What do Uganda, the Ivory Coast, and the United States have in common?
Extreme wealth inequality. And according to a new paper from Thomas Hungerford at the Congressional Research Service, capital gains and dividend tax loopholes are responsible for our nation's unequal income divide. Capital gains and investments used to be taxed like regular income, but they were lowered once in 1996, and again by the Bush tax cuts. Over the last decade, those tax loopholes allowed the rich to gain massive amounts of wealth, and led to an extreme increase of income inequality in our nation.
According to Mr. Hungerford's report, changes in wages between 1986 and 1996 had an equalizing effect, and most of the equalization occurred after a 1993 tax hike. However, after the Bush-era tax cuts in 2001 and 2003, Hungerford says, “most of the equalizing effect was reversed.” And this isn't the first time Thomas Hungerford researched the the income divide in our nation. In a 2011 study he prepared for the Congressional Research Service, he found that between 1996 and 2006, income grew at 25% for all Americans, but the top 1% saw a 74% growth rate on their wealth.
So, thanks to big tax breaks, the rich are getting richer and the poor are getting poorer. It's time to make the rich pay their fair share. Close the capital gains loophole and stop rewarding people who make money with money. Let's help out the real job creators in our country – the working people.
Comments
Brilliant economic plan, tax the rich guy down the street that will make you feel better at night as you watch the value of your dollar collapse. It does not take a rocket scientist to understand that the S&P 500 index was 740 in December 1996 and it was 1418 December 2006. that is a 91 percent return in 10 years, that is how you build wealth Thom. But I guess your plan would be steal it from those who actually understand one has to save and protect yourself and family for the future. But as always the Libs have to blame someone for their stupidity.
We need to reenact the stock transaction tax. It worked well for President Roosevelt and would work well now. Tax all income the same including income sent to the Cayman Islands, Bermuda and Switzerland.
Furthermore, we need to tax loopholes. Saint Raygun screwed the middle class by not allowing deductions for sales tax and credit card interest and limiting medical deductions on the amounts over 7% of income. He also screwed the middle class by raising fees for the national parks. Saint Raygun let the rich get away with murder. Screw the neotards.
Quote kend:.. "Close the capital gains loophole and stop rewarding people who make money with money" isn't that the way most seniors make their money. By investing the money they earned in their younger years. Now the left wants to put grandpa in the streets??I don't know of anyone, now, who is dumb enough to throw their money in the rigged casino capitalist game anymore. The best way to lose your life's savings is to trust the crooked system that has ruined many retirees..made them lose their houses..and held them hostage in the crooked HealthScare mafia. You may be tempted with the carrots of a few extra percent (or..nowadays..fractions of a percent) by gambling it in a riskier venture but you stand to lose it all. It's a crap shoot! Only the smartest and richest gamblers with the odds in their favor using computer trading usually come out the winners. And they desperately need to fool all the little suckers to 'invest' their money.
Quote global:the S&P 500 index was 740 in December 1996 and it was 1418 December 2006. that is a 91 percent return in 10 years, that is how you build wealth Thom.
That's how the rich build even more wealth...the average person loses. As with all forms of gambling, when someone wins...someone else loses. The ones who own the casinos never lose. They let an occasionally 'lucky' person win to act as a carrot to sucker others who think they may have a chance at winning too. Those Wall Street numbers don't really mean anything except to the very wealthy. It's really wealthy insiders who are driving those numbers. The reason why our gasoline is so expensive is mostly because of the Wall Street 'trading' changing hands (speculating..driving the prices up) as many as 26 times before that gallon of gasoline was being sold at record highs. And it's not just gasoline..it's everything else as well. They create bubbles and then prick them at opportune times (when they manage to convince the masses to throw their money into the craps table)...winning on the way up and on the way down.
As Elizabeth Warren recently grilled the banking 'regulators' and told them that if they can go after the little guy for committing small-time crimes, prosecute him and throw him in jail, then why can't they do the same for the crooked banksters. Our criminal justice system and political system is being held hostage by these crooks because they are seen to be too big to jail.
"I don't know of anyone, now, who is dumb enough to throw their money in the rigged casino capitalist game anymore. The best way to lose your life's savings is to trust the crooked system that has ruined many retirees."
ya Palin, look at poor people who invested in GM, the government took what they invested away from them and give it to the union.
The sad thing is, where do you invest it. who can you trust anymore. Not even your own government. I wish I could invest in the same things politicians do, they all seem to be getting rich.
Quote kend:The sad thing is, where do you invest it. who can you trust anymore. Not even your own government. I wish I could invest in the same things politicians do, they all seem to be getting rich.
No kidding! And that goes for both parties!
Kend wrote: doesn't the top 10% pay 70% already? I will ask again isn't that fair, if not what percent would be fair.
The top 10% may pay 70% of the taxes, but they take home 80-90% of the income. What % would YOU think would be fair given that ratio?
Those who think that the US can cut its way to prosperity are obviously just following lockstep the current business philosophies. But here's the rub; The country is NOT a business. Also, when business "cuts its way to prosperity" ONLY one side (the exec and investor class) wins. The sacked employees and the nation as a whole LOSE...Big Time. It's a zero-sum outcome. But business execs, like bookmakers, never look at the losing side of the equation. As long as they're winning, they don't care what the fallout is on the other side. That's fine for them, but you CAN'T run a country like that.
We live in a consumerist society that requires consumption to drive demand which drives employment. For consumers to consume goods and services at a sustainable level they have to have disposable income and income security. The alternative is for them to finance their consumption with debt. Over the past 30-odd years consumers have been induced to debt finance their consumption (at the behest and benefit of the business community) to counterbalance falling real wages and the outsourcing of jobs, by the provision of artificially cheap credit. However, debt funded consumption is not sustainable when incomes are falling and jobs are disappearing. We are now in a phase where consumers are starting to pay down their debt and are reducing their consumption. Since demand for goods and services has dried up, where will the demand come from to fuel employment and thus consumption? It HAS to come from the government. One major way government can create demand is infrastructure development.
To resuscitate our economy, two things have to happen; firstly the government should and must create some employment demand and secondly businesses MUST start to bring fairness back into their wage outcomes and STOP shipping jobs overseas. Businesses must start to look at the economy as a whole, in order to understand that what goes around, comes around.
Scott, I like a flat tax for all. About 25%. Then we all pay our fair share. The more you make the more you pay. Our government then lives with want they get and no more.
And the top 10% make no where near 90% of the income. Not even close.
Value!?!? Really???Wutch you be talk'en 'bout!?
With rare exception, our "liberal" discussion is media-driven/directed, focused on pandering to the consumers of their sponsors' products. The middle class. We elevate what is left of the bourgeoisie, and disregard the rest of the America. Historically, every time the richest few gained too much power, to the harm of the country, the poor and middle class united to push back, to the benefit of both. Not this time. This time, the middle class threw the poor off the cliff, and now the rich are throwing the middle class off the cliff. We saw the start of something powerful with "Occupy". But "liberal" media immediately redefined it exclusively as a "movement of middle class workers," the better off alone. The rest of us walked away, and Occupy died out. Divide and conquer. One dirty little secret that history reveals: You can't save (much less, rebuild) the middle class without shoring up the poor. If we had wisdom, we would look at those policies that created an era of extraordinary productivity and shared wealth, with dramatically reduced economic disparities, from WWll until the 1980s, creating our once-massive middle class, largely by opening the doors of upward class mobility to the poor. Then we would contrast this with what has happened when we got rid of those policies, esp. since 1996.
Herbert Hoover tried austerity and it plunged America into the Great Republican Depression of 1929. Hoover called in the WWI loans plunging Germany into depression. This is how Adolf Hitler got his chance to become dictator. We all know how that turned out. Austerity will, in my humble opinion, plunge America into another Great Republican Depression in 2013.
Our only recourse is to create massive infrastructure programs which will create jobs. With jobs,
the average American will also have money in their pockets and be able to buy what we produce. Henry Ford shocked the world in 1914 with his $5 a day salary for his workers. He reasoned that if the workers had money, they would buy his cars and they did.
We also need to close loopholes in our tax structure so that trillionaires can't send their money to the Cayman Islands or Switzerland. This takes tremendous amounts of money out of our economy which could be available financing new businesses here in the U.S.
In addition, we must change the tax law enacted by the neotards giving corporations a tax break for moving overseas. After all "the poor corporatons need this tax break". Bull.
AUSTERITY DOES NOT WORK!!!!!
TRICKLE DOWN ECONOMICS DOES NOT WORK!!!!!
The conservatives need to get real and learn something about economics and history before they
blindly plunge America into another Great Republican Depression.
Kend&Global - Nice try at leaving out the fact that the Wealthy pay 70%, but in reality they are only paying 20% on their Capital Gains which is where the Wealthy earn their income. And they pay even less when you add up the deductions and loop holes they get. While a teacher who earns $60K a year pays 30% of her income with limited deductions on Federal Income tax, plus State Taxes. So like most Conservatives like Global and yourself, you leave out the real facts about how much tax Americans pay (and I am talking about Americans) each year based on a percentage of how much they earn. Nice try, but only a Canadian or a Republican would buy your B.S. But since Obama already signed off on a mere 5% increase in the Capital Gains that brings the tax for the Wealthy Americans to a mere 20%, plus write offs and loop holes in the Tax Schedule. All this discussion is a mute point in the overall scheme of what is happening or going to happen here. Your 100% correct when you state you cannot trust the American Government. Obama knowingly has already settled the discussion on any tax revenue increases when he agreed to only raise the Capital Gains a mere 5%, which is exactly what the Republicans wanted. The Democrats and Obama vowed to raise the Capital Gaines tax back to the level of 39.5%, and they settled for 20%! Like Boehner stated yesterday, the discussion about any new revenue increases is already over. Now the Republicans can just sit back and let Sequestration take care of all the tax cuts they have wanted for years. Since Obama has nothing left to bargain with, he and the Democrats already agreed with the minimal Capital Gains increase, the ball game is over and Obama with the Democrats can go to the showers and pat each other on the ass for trying to win the game. Personally I think Obama and the Democrats actually wanted the minimal 5% increase for the Millionaires and Billionaires that pay for the hundreds of millions of dollars they need to run in each election cycle. Americans have been sold out by both parties’ on the Sequestration issue. But like the Republicans in 08', the Democrats will pay for their decisions in 2014 and they deserve to lose the House and the Senate because of their inability to get anything done for the American Voters that elected them into office. I noticed Hartmann did not mention the fact that Obama and the Democrats caved in and agreed to a mere 5% increase in C.G. tax to hold off the Sequestration cuts, and now the cuts will happen anyway. Either Obama is an idiot for not seeing what would happen once the Republicans got the small 5% increase for their people, the Millionaires and Billionaires, or he wanted the increase to be only 5% for the Billionaires who pull the strings in the Democrat party. I believe he knew what he was doing and actually wants the cuts to take place and he can tell the Democrats across America that he tried his best and put it all on the Republicans! He is one sneaky SOB. under all that, 'I am one of you", B.S. he spreads around. He has never been one of the hard working middleclass in America. I am just thankful I did not vote for Obama or Romney in the 2012 election, my hands are clean when it comes to voting for either of these sell-outs.
It's pretty clear to me that Capitalists like big banksters and the Kochs have sucessfully used their bought and paid for Republican numbnuts to almost completely remove government, "We the People, " from meaningful control of our own economy. Their policy of deregulation and legislative obstruction has lead us from one economic disaster right into another.
The obvious solution to this ongoing crime against humanity would be Democratic Socialism. However in the meantime I think taxation is a good tourniquet to stop the hemorrage of wealth flowing from the 99% into the pockets of a relatively few out of control mad men.
I say go back to the pre- Reagan tax rates and watch the economy take off like a rocket!....Spend our way out of the economic idiocy of austerity, and back to prosperity!
My husband is normally a quiet, reserved sort of guy (in public at least). But in the privacy of our home, we get kinda silly sometimes. This conversation about austerity reminds me of one moment in particular when he unzipped his fly and said "Here's what I think of 'trickle-down' economics... peein' on the peons!" And ya know, that pretty much says it all. - Alice I.W.
The rich should, by all means, pay their fair share. No one's asking them to pay more than that, which is what's so boggling about this. Many rich folks think that they would be paying more than the average taxpayer but 30% - or any percentage - at any level is the same piece of the pie. The only difference is the size of their pie.
Global says "It does not take a rocket scientist to understand that the S&P 500 index was 740 in December 1996 and it was 1418 December 2006. that is a 91 percent return in 10 years, that is how you build wealth Thom..." and blah-blah-blah. As if life was all about numbers and economics and getting rich (Translation: GREED). Not in my realm of reality it isn't. Thankfully, not in everyone else's either.
Life is supposed to be about actualizing our potential as human beings. It is about learning, adventure, growth (both inner and outer), discovery, creativity, friendship, family, community, cooperation, love, belonging, identity (personal and cultural), spirituality, connection, solitude, giving and receiving, respect, humility, curiosity and awe... But in Global's world and Kend's it all revolves around the S&P 500 index, the stock market, winners & losers, haves & have-nots, gettin' YOURS (before someone else gets it), them that eats and them that gets eaten.
Like night and day, isn't it! - Aliceinwonderland
Pay attention Alice, the original statement was about the rich getting richer over that 10 year period. Most of the rich I know build wealth through savings and investments, and looking at the performance of the stock market during that period it is obvious that is how most of them got that 74 percent growth. Your hero Warren Buffett understands the concept. Saving and investing is still available to everyone. No, life is not all about economics but it seems the left and many of the so called "have nots" never run out of ideas or conversation to steal from those that have. It is always the same old crap -- " I don't have mine so you can't have yours. We all must be equal in our misery". Lets try the North Korea way of life -- they are mostly all equal In wealth.
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C'mon ALICE...Didn't you get the memo???Life is about gaining higher financle status and accumulating a whole bunch of stuff, by any means necessary without regard to the virtues and values you mention.
Kend and Global are "legal theives"(now that's an oxymoron); their way of thinking and behaivours are excused by Egoism, Capitalism and Oligarchic Philosophy.
Sure they too want to love, and be loved, to "live" a happy and healthy life (subjective), however, their brand of prosperity comes at the cost of others, i.e. my 8 year old daughter Krissy's life... "dems da breaks"...Right KEND & GLOBAL?
GLOBAL chill out!!! No one here wants to adopt North Koreas way of life, nor is anyone suggesting that you can't have more $$$ than me. But we are no longer willing to suffer for the greedy fools.
Now Global I have no idea how you made/make your money. I know you are an "oil man", but is that from working in the industry or investing in it, or both? Regardless, you seem to have a real problem with those of us that value more than artifical markets and want more of a collective quality to life than arbitrary investment profits.
In no way am I saying that you do not deserve to do with your money as you please, more so I am pointing out that when financle profit is coveted as the end all be all...people die!
Alice why is it that liberals say they don't care about money but they work so hard to take mine?
nachos, with a eight year old daughter don't you feel guilty about saddling her with this massive debt?
KEND you arrogant prick! My daughter - Krissy - is dead. She lost her life to cancer 9 years ago at the innocent age of 8.
My wife and I did not have a health Insurance policy...We, like most middle class working stiffs, couldn't affoard it...And we had nothing to put up for the treatment Krissy needed.
Funny though one of my bosses at the same time beat cancer...His policy gave him full access to all the best doctors and treatment necessary.
Now Kend don't go assumoing that I am bitter towards my boss, cause I'm not. But the only reason he is alive and my Krissy is dead is because of good quality health insurance.
Please Kend, explain why the supposed greatest country in the world would rather spend trillions on unnecessary wars and the continuation of the Military Industrial Empire than offer it's citizens affordable health care? The price of one Drone Death Plane could have saved over 100 Krissys'. Instead we use that money to murder thousands of innocent people.
Sorry for your loss. I lost my neice about nine years ago to cancer as well at the age of 17. I have never said I like the health care system there, and I can't beleive that all children are not fully covered. I have always said let the middle east look after it self. Lets all get the hell out of there. Canada's troops have been there for 14 years. We have all the energy needs we need in North America. What I was saying is, if you can't afford these things now how will our future generation do it with a massive debt. Sorry again I had no idea. My neices name was Krissy to. What a shitty way to start the day. I hope yours gets better.
Global says "Most of the rich I know build wealth through savings and investments, and looking at the performance of the stock market during that period it is obvious that is how most of them got that 74 percent growth...." etc, etc, etc. (Y-A-W-N) Whatever, Global. All this talk about rich folks is getting very boring. - Alice I.W.
Kend says "Alice why is it that liberals say they don't care about money but they work so hard to take mine?"
Get a grip, man, and take a deep breath. I assure you, there's nothing you or Global have that I would want for myself. - Alice I.W.
NACHOS says "But the only reason he is alive and my Krissy is dead is because of good quality health insurance."
I need to remind you my friend- there is no such thing as "good quality health insurance". Why? Because health insurance is just one big-ass, bogus racket. Your boss was lucky, 'tis all... lucky the insurance hacks didn't say "Sorry, that treatment is experimental- claim denied!" Those two little words - "claim denied" - have translated to a death sentence for tens of thousands of Americans whose insurance companies refused to pay for the surgeries and treatments prescribed by their doctors. For millions more, it has lead to financial ruin, tantamount to a slower kind of death.
What we need is good quality health CARE, not health insurance. Because health insurers contribute NOTHING of value to health care. Their sole purpose is to present an obstacle to care so that they can rob us blind, which they have done for decades with our government's blessings. Even paying their premiums is no guarantee that you will get what you've paid for in your moment of need. Your boss is lucky to be alive.
Being an American is a curse. - Aliceinwonderland
Amen, the U.S. wealth inequality is at a level which is not that of an advanced nation. The only other developed country which is as bad or worse is Singapore, well run but a dictatorship. One can check wikipedia for details. The U.S. is 1/2 way between being 3rd world and first. Inequality homicides health data are at least way down amongst industrialized nations. Our polticial process is backward. We are more like the nation we once opposed Russia, a crony capitalist oligarchy than much of anything else.
We have the best higher educational system in the world though which is why we know so much about our backwardness.
Karlmarx says "We have the best higher educational system in the world though which is why we know so much about our backwardness."
That is one of the most brilliant statements I've read on this blog in a long time. Take a bow, Mister Marx. - Alice I.W.
Yaay! Ugly Fluffy's back!! Thank you, PD. - AIW
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"It's time to make the rich pay their fair share" doesn't the top 10% pay 70% already? I will ask again isn't that fair, if not what percent would be fair.
"Close the capital gains loophole and stop rewarding people who make money with money" isn't that the way most seniors make their money. By investing the money they earned in their younger years. Now the left wants to put grandpa in the streets??