CAMPOS: Wealth on move - to the rich

By Paul Campos, Rocky Mountain News (Contact)

Published October 21, 2008 at 6:12 p.m.

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October 21, 2008

8:10 p.m.

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peterpi writes:

Any moment now, the thundering herd will arrive screaming "Campos is a Socialist!"
But I say "Thank you and right on!"
There is a redistribution of wealth going on. But it's not being caused by Barack Obama. Massive amounts of wealth are flowing upwards from the bank accounts and pocketbooks of more and more working-class and middle-class people into the bank accounts of fewer and fewer wealthy people. George Bush approves. And I think it is immoral and obscene.
Our conservative friends on the website love to blather on how 1% of the country pays 50% of the country's income tax. What they inevitably fail to state, of course, is how much of the country's income that 1% earns. I'll guarantee you they receive at least 50% of the country's income.
October 21, 2008

9:47 p.m.

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Spencer writes:

OK now I know what Kopel's going to write about. He should pay you for giving him ideas
October 21, 2008

11 p.m.

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taoistblockhead writes:

http://www.realitysandwich.com/put_fo...

Put a Fork in It
By Daniel Pinchbeck

"I have developed the late-night habit of obsessively tracking through articles and reports on the global financial system. It appears that the patient is in the throes of a massive heart attack, after years of abuse and hyper-activity, and all attempts at resuscitation are failing quickly. Recent highlights include:

1. A LEAP2020 report argues persuasively that the US will be forced to default on its debt next summer, and the Telegraph agrees that the current infusion of hundreds of billions of dollars from European and American central banks will only delay the next level of collapse by a few months, potentially leading to martial law in the US and many European countries.
2. An editorial from Sunday’s NY Times anticipates an upcoming “rash of corporate bankruptcies” that will be “very bad news” for stockholders, employees, and lenders.
3. An analysis concludes the $700 trillion derivatives market is about to melt down, along with thousands of hedge funds, according to the Guardian.
4. Meanwhile, the lack of credit is crippling export of basic goods from the “developing world,” endangering the lives of millions of people whose existence depends on our purchase of their products. A mega-crisis caused by the greed of the rich is destroying the lives of the poor.

All of this data, and much more, strongly suggest that the global financial system, in its current form, cannot be salvaged. At best, we may have a year or 18 months before the system fails us entirely. After that, money, in its current form, may have no value at all, as basic trust in our institutions evaporates. ..."

Continued at http://www.realitysandwich.com/put_fo...
October 22, 2008

6:27 a.m.

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Mike_In_Hartsel writes:

Anyone who gets his "news" from self-serving web pages is a blockhead.

Hey, Campos? Maybe the top 1% traditionally work harder at what they do so maybe that's why they earn the most? If that figure hasn't changed in over 60 years dispite the efforts of socialists to take their money it supports the notion that some people work a lot harder at what they do best? And, at the other end you still have those who don't want to work who hold their hand out saying "gimme".

What entitles those with their hand out to the money of others?
October 22, 2008

6:48 a.m.

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taoistblockhead writes:

http://www.realitysandwich.com/put_fo...

"The modern West created an economic system fundamentally based on the creation of debt. Capitalism requires constant expansion and exploitation of new markets in order to maintain itself. Economists have ignored the hard limits on planetary resources when calculating future potential for development. It was an absurd, almost cartoonish error to believe that we could continue limitless growth on a finite planet.

Capitalism has tremendous dynamism but is inherently unstable. In the future, we will look back to realize that capitalism was a transitional system, unifying the world into a single market and communications grid, before being replaced by a more durable and sustainable economic order. Ironically, considering his repudiation in recent decades, much of Marx’s analysis is proving accurate and prescient.

On another level, we can see that the current global crisis has been forced by the mindset of domination and competition that reflects our immaturity as a species. The Darwinian notion of the “Survival of the Fittest” was an imposition of our competitive and ego-centric worldview onto the natural world. As most biologists now see it, healthy ecosystems are based on complex patterns of cooperation and interdependence. As the WBAI talk show host Tiokasin Ghosthorse notes, humanity must shift from living "on" the earth, to living with her.

Put in the simplest terms, then, our global society is going to have to undergo a rapid – almost instant – transition from competitive and possessive behavior to cooperation and sharing if we want our species to survive, let alone thrive, into the future. Considering the ecological crisis of species extinction and climate change and the fragility of our support systems, this change has to happen in an extraordinarily compressed timeframe. What we don’t have yet is a realistic plan of action that gets us from here to there."
October 22, 2008

7:14 a.m.

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taoistblockhead writes:

http://www.creative-i.info/?p=1563

We are seeing "the collapse of a 300 year Ponzi scheme. All the king's men cannot put the private banking system together again, for the simple reason that (it's) reached its mathematical limits." It needs new borrowers but doesn't have them. This racket has gone on for 300 years "ever since the founding of the Bank of England in 1694." The whole world now is "mired in debt to the bankers' private money monopoly." The dirty game has reached its finite limits. "The parasite has finally run out of its food source."
October 22, 2008

7:19 a.m.

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VVVV writes:

Considering that the middle and lower classes enjoy a much improved standard of living than in 1947 and 1979, how can you say that the system is failing? Population is growing, and the top 0.1% have to accomplish profitability and manage companies that are larger than entire industries in 1979, so why shouldn't they make more money? Computers have made it so that one person now must do the work that used to be done by departments of people, so why shouldn't they get paid more?

All that your ratios prove is that the economy has expanded by huge amounts, such that it makes sense to add a new class of people the "super rich". That also doesn't prove that anything has failed. On the contrary it means that capitalism is proving that it works to such extent that it is changing the makeup of society. It is noble to expect that everyone from the super rich to the meager poor be treated with equality and freedom in mind. Redistribution of wealth is just greed, the majority imposing it's bastardized idea of equality - one's contribution to society as being irrelevent to the rewards due - on a minority that deserves what it has earned.

Without the promise of reward, there is no incentive for anyone to take risks to be the next Bill Gates, and our country will dissolve into apathetic mediocrity, eventually being destroyed, exactly like the Roman Empire fell.
October 22, 2008

7:23 a.m.

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denverinfidel writes:

You silly socialists. You all claim everyone should pay more in taxes, yet you never offer up your own money? Why? If any of you were even remotely principled you would get out your checkbook and pay more to uncle sam. But you don't. Talk is cheap, and Campos is a hypocrite. How much extra does he pay each year??

The rich have more money (no sh*t, eh), but they also pay a very disproportionate amount of income taxes (top 10% of earners pay 70% of all income taxes). If you want to make more money, work harder and smarter and emulate the rich.

If your lazy and out of ideas, vote for tax increases.
October 22, 2008

7:26 a.m.

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mytwosense writes:

Good column, but I agree that we will soon see the sputtering protests from folks who only want to talk about wealth distribution in the context of calling the majority of workers "freeloaders, non-producers, welfare queens," etc.

Mike_in_Hartsel's post was particularly instructive, in which he suggests a microscopic portion of income earners "work harder" than the remaining 99.9999%!

I do not believe that wealth has a direct correlation to "hard work." A lot of very rich people, most especially in recent years make their money through speculation on basically the real work of others. For example, Exxon stockholders often make more money than the guy working on an offshore rig, or the Exxon gas station owner .

Not knocking anyone who chooses to invest in the stock market, but I, like many other Americans, would like to stop hearing some people knocking the non-wealthy as "non-producers."
October 22, 2008

7:37 a.m.

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mytwosense writes:

denverinfidel: "The rich have more money (no sh*t, eh), but they also pay a very disproportionate amount of income taxes (top 10% of earners pay 70% of all income taxes)."

As I've pointed out on other posts, the top 10% also own more than two-thirds of the net wealth in this country, according to the Fed's Consumer Finances Report. If they only owned a very small percentage, I might agree there's some unfair lopsidedness going on in terms of taxation.

But seeing as they own so much wealth, it seems to me from a mathematical standpoint that of course they end up paying a large proportion of taxes. Even if we went to a flat tax rate, they still might, as then even more taxable wealth would get transferred back to them.

I suppose we could do a national sales tax instead...it's not that I don't see some benefits to one, but I also see a lot of potential problems which I won't outline all of here. I will say that I bet we'd still hear complaining that the rich pay more in taxes because they buy more stuff, and therefore, "the non producers" shouldn't benefit from any services those taxes pay for.

The best solution in my opinion? Let's see more people move out of the lowest tax brackets! Obviously we have a large number of crappy paying jobs in this country, and I agree with Campos that weakened unions are at least one reason why. There are likely many more reasons, as well.
October 22, 2008

8:25 a.m.

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ghoax writes:

straight from the Marxist playbook. Here's how that plays out, take a 50 yard dash.

the winner trains and works out and wins the race,

however, after crossing the finish line, he is arrested ,then the blue ribbon and any winnings go to not only those still trying to run, but those on the sidelines wishing they could run.

sure, makes tons of sense...NOT. These people are fools to buy into a philosophy that penalizes success, and that's exactly what we already have that needs to be reformed, not supported and expanded.

The solution to our economic problems is to open the valves of commerce, get out of a debt driven economy, and instill in the mind of every American that we need to be doing what made us strong to begin with , the those who flocked here for years did , we work hard to be successful, enduring the failures and the tough times that lead to success.

Business must earn your money, the government simply coerces you to pay what it determines you need to. Do you really want the government to determine how successful you can be?

What they propose is replacing rewarding excellence with rewarding mediocrity.
October 22, 2008

8:35 a.m.

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AngelontheSidelines writes:

Mike_In_Hartsel writes:

Anyone who gets his "news" from self-serving web pages is a blockhead.
--------------------------------------------------
Do you mean sites like Worldnutdaily, Onenewsnow, or my fave Newsmax?
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Hey, Campos? Maybe the top 1% traditionally work harder at what they do so maybe that's why they earn the most? If that figure hasn't changed in over 60 years dispite the efforts of socialists to take their money it supports the notion that some people work a lot harder at what they do best? And, at the other end you still have those who don't want to work who hold their hand out saying "gimme".
-----------------------------------------------

LOL, good one,
Do you actually posit that these top 1% fat cats work? Why has that figure remained unchanged for 60 years? FDR's New Deal is why.

FYI Mike, Fascists were a popular faction in the 1930's, Prescott Bush was instrumental in funneling capital to German war hardware manufactures, and a certain kooky little man who never would have risen to prominence without his assistance.

The American fascist robber barons attempted a coup to seize the powers of the president and reverse the direction FDR took in controlling Wall Street.

The only people working hard today are those who's payroll is reduced to put more money at the top, AKA trickle down.
October 22, 2008

8:50 a.m.

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xeeian writes:

It's a good thing my tax dollars aren't being redistributed to wealthy CEOs of Investment banks and their golden parachutes.

We wouldn't want that to happen.
October 22, 2008

9:51 a.m.

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denverinfidel writes:

Mytwosense -

The top 2/3 don’t “own” 10% of the net wealth. They created it. It’s what’s left over after the gov’t takes their cut. I also never claimed the tax system is lopsided (although it obviously is, its not out of line with wealth and earnings). But its dishonest to try and discuss wealth in this country and conveniently exclude our tax structure, and those who fund Campos’ beloved politburo. The bottom 30% of filers pay no federal income tax. The claim that money is somehow lifted from poor assembly line workers and given to the top 1% is laughable and borderline retarded.

Liberals want a progressive tax structure, and that is exactly what we have. You would think maximizing revenue for the gov’t to operate would be yours and Campos’ goal. But its not – your goal is to punish success to make yourself feel better about your own failures. There is no more of a clear, succinct and philosophical difference between left and right in this country. One side believes you are entitled to the fruits of your labor; the other doesn’t. Campos believes he can structure a society where resources are organized and equitably distributed from the top down (you and Campos being at the decision-making top, of course). History tells us otherwise.

And I’ll repeat my first point: If you believe wealth should be more equitably distributed, then why don’t you offer more of your own?? I am certain just about everyone posting on this site is in the top half of earners (or much better). That money is not yours, you didn’t earn it, and since gov’t is the best way to achieve equality, you should give it back. That’s what I thought. You don’t pay taxes to be nice or altruistic. You pay because if you don’t the IRS will put you in jail and take everything you own. Without that threat you don’t pay. Talk is cheap – pony up all you greedy hypocrites.

As for tax structures, we need a flat tax. The Internal Revenue Code is something like 60k pages long. That’s insanity. There is a number, open to debate, where people have an incentive to invest, earn and take risks and not hide money from the gov’t. Sales taxes sound great, but they really are regressive. Although they punish those who consume more (ie, the rich). And punishment is the ultimate goal, right?

As for unions, the UAW sure has saved jobs, eh? Honda, Toyota, Nissan, MB, etc are all able produce cars in north america at a profit. Whats the difference between them and GM? Hmmmmm……The sad fact is those guys are losing their jobs either way. UAW or not.
October 22, 2008

10:24 a.m.

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Cwillyrun1 writes:

Unions in Detroit have hurt the Big Three...... what is Campos talking about with weakened unions? The teacher's union maybe? Nah, because they control the education system. The "weakened union" for state employees? Nope, Ritter made it easier for them to extort monetary gain from taxpayers. If Campos wants to pit out the words "weakened unions", he should be specific with examples so his claims can be believed.

I wonder...... if those who have no problem with wealth redistribution, would they like this scenario? Say those who feel the people with the most money should pay for more of society's needs live on a block where they make the most money, and their neighbors know it. So the neighbors vote on how to pay for lawn maintenance and snow shoveling, etc., and because you make the most money, you get to pay it all because that's how they voted. Would you be happy with that, or would you consider it fair? I wouldn't.
October 22, 2008

11:13 a.m.

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mytwosense writes:

Owning wealth doesn't necessarily mean you created it. Now, if you founded a business, grew it over the years, etc., yes, I would say you were the primary creator of that wealth. Although it's a little strange to ignore the role good employees helped in these efforts, which seems to be what I'm hearing here.

But I would say the really richest people we're seeing these days have made their money off the financial markets. They had little to do with originally founding the businesses these markets trade stocks in.

And CEOs who oversee hostile or even friendly corporate takeovers absolutely do not create the wealth they end up owning. In fact, they typically buy these businesses by borrowing the money to do so. How do they pay those loans back? By selling off the company's assets other people worked hard to create over the years, or helped create, and very often that includes employee pension funds.

There is no way I will view such parasites as "producers," much less tell my fellow citizens we are beholden to these parasites.

And speaking of CEOs and other public company executives. How many of them founded these companies, and how long are they really staying there? About long enough to decimate jobs to create shareholder "value" - and they usually own a huge portion of shares, themselves.

Again, these are not wealth creators. That wealth already existed from the fruits of other people's labors or vision - they just transferred it to their own pockets.

To assume that the wealthiest people in this country today created the wealth they own is an uninformed naive assumption that is pretty insulting to a huge group of people who actually work their tails off. Show a little respect.
October 22, 2008

11:28 a.m.

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mytwosense writes:

Cwilly: "I wonder...... if those who have no problem with wealth redistribution, would they like this scenario? Say those who feel the people with the most money should pay for more of society's needs live on a block where they make the most money, and their neighbors know it. So the neighbors vote on how to pay for lawn maintenance and snow shoveling, etc., and because you make the most money, you get to pay it all because that's how they voted. Would you be happy with that, or would you consider it fair? I wouldn't."

Good analogy. If everyone owned roughly the same size lawns and sidewalk space, this would be very unfair.

But let me add to your analogy to better explain what I'm trying to point out on this thread. What if the ones who were asked to pay the most also owned most of the lawns and sidewalks that needed to be mowed and shoveled? I'd absolutely think they should pay more for this maintenance.

And that's exactly the situation in America. A tiny percentage of people own the majority share of this country's wealth. And some of you believe they should get even an better break on the taxes for this wealth?

It honestly doesn't make sense to me. They seem to have a really, really good deal going! I seriously doubt they'd be interested in trading places with any of their defenders.

I will also point out that if we ever did go to a flat tax, that's when the majority of people are going to wake up and realize they're getting the shaft. So be careful what you wish for. That is, if you wish for most of the wealth in this country to stay concentrated in only the hands of the few.

But both sides are guilty for fixating on the progressive tax structure. We should be even more dedicated to moving folks up to a higher tax bracket. I personally would like to see more emphasis on an entrepreneurial spirit in this country, to see more folks open up their own businesses.

One thing that prevents this is we've pretty much stopped enforcing monopoly laws. There are entire towns and suburbs where you will not find a single business that is independently owned. Everything's a big box store, a chain corporation. Not only does this choke true competition, it's created a rather depressing monoculture.
October 22, 2008

11:32 a.m.

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mytwosense writes:

I'm sorry my posts are getting so long. I'll try to be a little more concise next time. :)
October 22, 2008

11:45 a.m.

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David_R writes:

Our Tax System Explained: Bar Stool Economics

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this:

The first four men (the poorest) would pay nothing.

The fifth would pay $1.

The sixth would pay $3.

The seventh would pay $7.

The eighth would pay $12.

The ninth would pay $18.

The tenth man (the richest) would pay $59.

So, that's what they decided to do.

The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve. 'Since you are all such good customers,' he said, 'I'm going to reduce the cost of your daily beer by $20.' Drinks for the ten now cost just $80.

The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free.

But what about the other six men - the paying customers? How could they divide the $20 windfall so that everyone would get his 'fair share?'

So, the bar owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay.

And so:

The fifth man, like the first four, now paid nothing (100% savings).

The sixth now paid $2 instead of $3 (33%savings).

The seventh now pay $5 instead of $7 (28%savings).

The eighth now paid $9 instead of $12 (25% savings).

The ninth now paid $14 instead of $18 (22% savings).

The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare their savings.

'I only got a dollar out of the $20,'declared the sixth man. He pointed to the tenth man,' but he got $10!'

'Yeah, that's right,' exclaimed the fifth man. 'I only saved a dollar, too. It's unfair that he got ten times more than I got'

'That's true!!' shouted the seventh man. 'Why should he get $10 back when I got only two? The wealthy get all the breaks!'

'Wait a minute,' yelled the first four men in unison. 'We didn't get anything at all. The system exploits the poor!'

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for drinks so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill!

And that, ladies and gentlemen, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.
October 22, 2008

11:57 a.m.

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mytwosense writes:

David R: "Tax them too much, attack them for being wealthy, and they just may not show up anymore."

Then whatever will we do? Maybe...gee...open up and invest in our own local businesses? And sell goods and services made right here in the US that aren't painted in lead and stuffed with melanine?

That would be horrible!

Anyway, we could remove corporate taxes altogether and that wouldn't stop companies from moving offshore if they can find cheap labor and get away with polluting wherever they land.

How much exactly are you willing to concede to such businesses at the sacrifice of your own country?
October 22, 2008

12:43 p.m.

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taoistblockhead writes:

Al-Qaida-linked Web site backs McCain as president

By Pamela Hess, AP

http://ap.google.com/article/ALeqM5iF...

WASHINGTON (AP) - Al-Qaida supporters suggested in a Web site message this week they would welcome a pre-election terror attack on the U.S. as a way to usher in a McCain presidency.

The message, posted Monday on the password-protected al-Hesbah Web site, said if al-Qaida wants to exhaust the United States militarily and economically, "impetuous" Republican presidential candidate Sen. John McCain is the better choice because he is more likely to continue the wars in Iraq and Afghanistan.

"This requires presence of an impetuous American leader such as McCain, who pledged to continue the war till the last American soldier," the message said. "Then, al-Qaida will have to support McCain in the coming elections so that he continues the failing march of his predecessor, Bush."

SITE Intelligence Group, based in Bethesda, Md., monitors the Web site and translated the message.

"If al-Qaida carries out a big operation against American interests," the message said, "this act will be support of McCain because it will push the Americans deliberately to vote for McCain so that he takes revenge for them against al-Qaida. Al-Qaida then will succeed in exhausting America till its last year in it."

Mark Salter, a senior McCain adviser, said he had heard about the Web site chatter but had no immediate comment. .......
October 22, 2008

12:47 p.m.

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David_R writes:

mytwosense ->

Unfortunately, it requires business to generate, create wealth. The government can't generate wealth, only borrow it or collect it (via taxation) from the private section.

I'm all for investing in and supporting American companies. I buy "Made In America" whenever possible. Buying American products supports American companies which provide American jobs. Additionally, supporting American companies allows those companies to grow and invest in expansion of either their existing business, add lines/products to the existing or, even start up other operations just like you suggest.

But business needs to be allowed to keep a substantial portion of their earnings to finance that expansion -- the expansion of our entire economy.

Government needs some of it to finance their operations and existing social programs. But the more they take, the less is available for investment in, and the expansion of the economy.

"Anyway, we could remove corporate taxes altogether and that wouldn't stop companies from moving offshore if they can find cheap labor and get away with polluting wherever they land."

Taxing them more will neither provide incentive to return operations already overseas back to America; nor will it provide incentive not to move future operations overseas if you limit the opportunity to profit and expand domestically.

"How much exactly are you willing to concede to such businesses at the sacrifice of your own country?"

While that is a valid question, so is "how much are you willing to stifle economic growth, job creation and innovation at the sacrifice of your own country because some people get rich while driving an expanding economy?"
October 22, 2008

12:50 p.m.

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Cwillyrun1 writes:

No, I don't think the top 5% should be taxed any more or any less. I think the excess in loopholes should be eliminated where possible, whether it be corporate, or private that results in the wealthy not paying taxes. I want government to also spend what we give them much more efficiently.

Regarding a flat tax, I think it's a good idea. It might help do away with loopholes. What it most definitely would do is decrease the size of the IRS and in doing so, decrease the size of government. The IRS is one of the largest parts of the federal government, and less people would be required to figure out tax rates. We would surely pay less in taxes than we do now...... us, the middle class!
October 22, 2008

1 p.m.

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anderson writes:

The McCain campaign's latest theme (right up there with "'the' media is out to get me") is that Obama is out to "redestribute the wealth"--appealing to idea that no one should not get anything they don't deserve. Like so many of their misrepresentations, it's all smoke and little substance. Obama has proposed a transfer of wealth, how? Please be specific. Unless I'm missing something, he has not advocated for more welfare or anything like that. Applying great taxes to the wealthy is not a redistribution.

On the wealthy: anyone but an ideologue can see that there is not a direct correlation between wealth and effort. That's not to say that a lot of wealthy people haven't earned their lot, but a whole lot of them inherit it. The wealthiest people in the world lists that come out periodically always include so and so, heirs to the x fortune. Cindy McCain and Theresa Heinz, for example, are not beer and ketchup magnates that built something from scratch. They got their wealth the old fashioned way: they inherited it.

Many of the wealthy, notwithstanding their efforts, also start out with advantages (two parents and education, and lack of strife in their community) that others do not.

The other side of this picture is the Right's continued efforts to portray the poor as somehow unworthy.
October 22, 2008

1:24 p.m.

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sunshinestate writes:

Knowledge redisitribution...............
Many would benefit from studies in economics,sociology.
It's called a'liberal' education.As in "liberal" dose of something.
This editorial is a glimmer of insight. Good job.
October 22, 2008

2:16 p.m.

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denverinfidel writes:

"Obama has proposed a transfer of wealth, how? Please be specific. Unless I'm missing something, he has not advocated for more welfare or anything like that."

Anderson - Yeah, your missing something. Its called a "refundable tax credit". Go do some research. If a taxpayer does not have enough tax liability to receive the full "credit" from the IRS, then the difference is "rebated" to them. Literally, a check would be sent to that non-tax payer. Normally, a tax credit is yours only so far as you actually have the tax liability to get the credit.

Where does the gov't get the money to rebate? From another taxpayer. That is a redistribution of income, plain and simple.

Both sides have abused the term “tax credit”, but his is from an alternate universe. In the real world, when you don't make enough money and the federal gov't sends you check, its called welfare. This is how the messiah can "cut taxes for 95% of working americans". Since the bottom 1/3 of filers have no federal income tax liability, simple arithmetic begs the question: how you can you cut a tax from zero???? How do you get credit for a tax you don’t owe?? Its called a welfare check.

Your second paragraph is so ignorant its scary. Yes, there are super-rich who inherit it. That will never change - anywhere in the world. But bambi’s rich starts around $150k (top 5%). $150k annually is not even on the same planet as Heinz or Cindy McCain. That is who is supposed to shoulder all of his new taxes.

“They got their wealth the old fashioned way: they inherited it.” More drivel. Over 80% of millionaires in this country are first generation rich, and 2/3 of those are small biz owners (meaning they really did earn it).

http://www.capmag.com/article.asp?ID=...

http://www.ntu.org/main/page.php?Page...

And lastly, for all your liberal heroes in congress - why are 6 of the 10 richest members democrats?? Did any of them earn it?

http://www.rollcall.com/features/Guid...
October 22, 2008

2:17 p.m.

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chaka419 writes:

anderson writes:

"On the wealthy: anyone but an ideologue can see that there is not a direct correlation between wealth and effort. That's not to say that a lot of wealthy people haven't earned their lot, but a whole lot of them inherit it. The wealthiest people in the world lists that come out periodically always include so and so, heirs to the x fortune. Cindy McCain and Theresa Heinz, for example, are not beer and ketchup magnates that built something from scratch. They got their wealth the old fashioned way: they inherited it."

You forgot the most worthless wealthy people, actors, singers, comedians, and the ever so ego driven media types. Should Katie Couric really be paid over $8 million? Although Brad Pitt is very good looking, is that a reason to pay someone millions for acting? These people offer nothing that we can not live without but are paid way to much. I think if Obama is elected and he enacts his "redistribution of wealth" policies we should start in Hollywood. I want of Jay Leno's fancy cars. I want one of Madonna's houses and I want all THEIR tax write offs!!!!!!!!!!!!!!!!!!!!!
October 22, 2008

2:48 p.m.

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Buzzy writes:

There is a not so subtle difference in your two scenarios.

In most cases, people WILLINGLY "transfer wealth" to others in exchange for goods and services. No one forces them to do so, and they are free to choose whichever vendor offers them the best value for their money, or they can choose to simply keep what they earn. "The Rich" that you so despise got their riches honestly for the most part, by providing goods and services that people willingly chose to pay for.

On the other hand, income redistribution by the government is done by force - money is confiscated from some, giving absolutely nothing of value in return, and simply given to others who have provided no value whatsoever in order to earn what they are given.

Really, there is no comparison at all between people willingly making other people rich via the free market system, and the government arbitrarily confiscating one person's wealth by force, and giving it to another.
October 22, 2008

2:51 p.m.

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anderson writes:

infidel, thanks for your steady stream of insults, and letting us know that you dislike "the liberals". In spite of your obvious superiority, I don't quite understand your explanation of a tax credit and how that's distinguished from the current earned income credit (EIC) that's been on the tax books for years. Must be on account of my stupidity. Also, I can't help but notice that in the real world, the govt cuts a check to all sorts of business owners and corporations.
October 22, 2008

3:09 p.m.

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Dencal26 writes:

I am middle class and I believe the 70% income tax at the top in the 1970s was nothing short of criminal regardless of how much I benefitted from it.
October 22, 2008

3:20 p.m.

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brmonsma writes:

Hey, we made the current rules; we can change them as the country requires and as determined by the majority. That's democracy, not socialism. There is no natural order - only agreed-upon rules conventions that best fit our circumstances at the time. Yes, we get to choose, regardless of land, power, and income.
October 22, 2008

3:23 p.m.

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PonchoVia writes:

Cindy McCain "made" $4.2 million in 2007. She paid federal taxes of $1.1 million. Source: http://www.latimes.com/news/politics/...

I mention this not to discuss redistributing Cindy's wealth, but just to ask the question, how in the world could Cindy and John "I don't know how many mansions I own" McCain possibly understand what it means to be a middle class worker in these crappy times created by 8 years of Bush/McCain policies? When McCain even suggests that he can relate to me or anyone I know, I laugh hard!

One thing is for sure, like George Bush, John McCain would leave no billionaire behind!

Obama/Biden '08!
October 22, 2008

3:48 p.m.

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anderson writes:

When you don't have a good argument, you can always regale your audience with rhetoric as Buzzy does here, to wit: the government "confiscates" our money by "force" and we get "absolutely nothing" in return.

Keep living in your ideological fantasies, Buzzy. There are a few (a very few) your message will resonate with. It's a damn shame you have to live in a society instead of having your own kingdom with all the privileges thereunto pertaining.
October 22, 2008

3:54 p.m.

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bobbyoshea123 writes:

How can anyone take this article seriously when the first paragraph says this: For example, last weekend John McCain went on Fox News and criticized Barack Obama for wanting to, in McCain's words, "spread the wealth around."

IN MCCAIN'S WORDS??? Those were Obama's exact words captured on video. Two sentences in and the entire credibility of the article is gone. Ridiculous.
October 22, 2008

3:56 p.m.

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denverinfidel writes:

Anderson - You're welcome, its my pleasure. Didn't realize your feeler were so sensitive. Going forward, you may want to stick to puff pieces about the messiah and avoid debates where facts are required (such as economics and tax policy).

You have thrown out some very very incorrect statments as though you have facts to back them up. You don't. Don't portray your opinions as facts and provide some meat.

"...a whole lot of them inherited it". Thats bullsh*t, and you didn't even bother to do any research to back it up. 20% inherit it, if thats what you consider "alot".

Since you now want to claim stupidity (convenient timing there), I'll dumb it down for you:

The EIC doesn't result in a check being sent to you. It results in your tax liability being lowered (your tax bill goes down). This is a large part of how the bottom third don't end up paying federal income taxes. They get "credited" back through the EIC. If you don't have enough liability (ie, owe enough in taxes), well then, thats it. You don't owe the gov't and the gov't doesn't owe you.

Under obamas plan, the difference of what you would have been credited towards your tax bill get sent to you as a rebate. Simple enough?

"Also, I can't help but notice that in the real world, the govt cuts a check to all sorts of business owners and corporations"

Really? Now your turn to be specific: when a corporation or biz files tax returns, who is getting a check from the gov't?

Remember, be specific.
October 22, 2008

3:58 p.m.

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RainbowWarrior writes:

What a bunch of hypocrits! Red states LOVE redistribution of wealth;

Of the 32 states that receive more money back from the federal government than they send to the federal government in taxes, 21 of them are polling ahead for McCain. Here are the amount of federal dollars these McCain states get for every one dollar they pay in taxes.

Mississippi: $2.02
Alaska: $1.84
Louisiana: $1.78
West Virginia: $1.76
North Dakota: $1.68
Alabama: $1.66
South Dakota: $1.53
Kentucky: $1.51
Montana: $1.47
Arkansas: $1.41
Oklahoma: $1.36
South Carolina: $1.35
Tennessee: $1.27
Idaho: $1.21
Arizona: $1.19
Kansas: $1.12
Wyoming: $1.11
Nebraska: $1.10
Utah: $1.07
Indiana: $1.05
Georgia: $1.01

Note: McCain is only ahead in 22 states. The only McCain state that sends more money to the federal government than they get back is Texas.
October 22, 2008

4:21 p.m.

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anderson writes:

infidel, you don't have to act like a braying jackass to get your point across. Talk like an adult or get off the pulpit.
October 22, 2008

5:19 p.m.

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jay writes:

more socialism conspiracy theories.

the democrats are no more "socialist" than the republicans, according to the "logic" used by the footsoldiers when spouting these ridiculous talking points.

all these myths prove is that hypocrisy still thrives on the far right.

can you smell the desperation?
October 22, 2008

5:26 p.m.

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taoistblockhead writes:

The unspoken assumption here is that most Americans seem to be fine with the United States as Empire (rather than Republic). Empires are not sustainable. Neither is a culture that spends more than 50% of it's budget on weapons of war and maintenance of its military. Neither is a culture built on overconsumption, violence and disrespect for the natural world. Other than that I'm sure everything will be great going forward.
October 22, 2008

5:27 p.m.

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macrmn writes:

Mr. Campos no wonder you did not ge a CPA degree- your are clueless. The increase in the relative wealth of the top few percent is not a TRANSFER- ie they did not take it from others. But government income redistribution is. The wealthy created more wealth overtime. Furthermore,it is not true that the poor & middle class did worse- actually they also increased their wealth- but not as fast--they did not "lose"(get stolen) wealth to the rich. All have prospered,just the rich more. While we need to be wary of such trends, they cure is not to rob peter to pay paul (and buy his vote). The real threat of Obamanomics is that 51% of Americans will get gov't checks paid for by the other 49% & the result is every election vote themselves a pay increase by increasing taxes (estimates are that under the one at least 45% will pay no income taxes & many get a "tax credit=welfare check"). Such a danger was forseen by the founding fathers.
October 22, 2008

5:29 p.m.

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denverinfidel writes:

Anderson, in all your writing on this message board you've managed to avoid any and all factual debate. Shocker.
October 22, 2008

5:51 p.m.

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boyydz writes:

Hmm… An utterly unfair parting shot. Obama makes well above the 99th percentile as well. Are we going to quibble over which candidate has an income more beyond the reach of almost every American?

Most Americans have no problem with a progressive income tax system. This is, I suppose, a form of “redistribution of income” in itself. However, it is unclear how far redistribution of income should be pursued. None but the most ardent communist would claim that all income should be equal. This would destroy the incentive for individual persons to be highly productive, and this result would benefit no one. At the same time, many believe the current tax system is sufficiently progressive to charge high-income persons a significantly larger share than lower income people. Where should the line be drawn to avoid having taxation decay the motive to pursue additional income through increased productivity? If Obama’s desired 39.5% (?) tax rate were placed at the top tier, many through the combination of federal, state, and local income taxes – not to mention payroll taxes - would be paying nearly a 50% total tax rate. At that point, many may decide that pursuing business expansion might not be worthwhile. This would be a disadvantage to everyone in our economy.

At the same time, we should recognize that lower-income persons should have an appropriate chance to improve their socioeconomic standing while not having to fear starvation. Thus, appropriate aid systems must be in place to assist such persons WHILE providing them the incentives to pursue such personal economic growth. These need funding from tax revenues, So long as such programs target the ultimate growth of the recipients as their goal, most, I believe, are willing to support them. What they are not willing to support is a segment of society that would live on such aid as their lifetime endeavor. Unfortunately, the current methods have tended to engender exactly such a group, and working Americans understandably do not like the idea of the double whammy of (a) spending their hard-earned – and in most cases, well-deserved – gains on perpetual bums and (b) discouraging the incentive for such bums to become productive members of society by providing perpetual aid.

(continued in following post...)
October 22, 2008

5:52 p.m.

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boyydz writes:

(continued from previous comment)

Unless the government is going to provide gainful work for individuals in large numbers (and how often does that happen other than in the military?) taxing money from higher-income people – who tend to be the employers – simply takes money out of the pockets of the people whom they employ – or would otherwise employ. Furthermore, they also tend to be the discretionary spenders, and their spending provides further employment earnings for other downstream earners. This is the basic concept of the oft-maligned “trickle-down” theory. But how is the opposite a better theory? What overall benefit does society receive from providing more wealth to lower-income persons? True, they spend a higher percentage of their incomes, so to that extent they help to fuel the economic machine, but these funds make no contribution to the enhancement of productivity that fuels the long-term upward growth of GDP. Higher income persons also invest substantial amounts of money, and this capital fuels such productivity, which in turn provides more total wealth for the benefit of everyone.

Ideally, all persons would pursue a lifetime of maximum productivity so that most would earn better than a minimal living. However, rewarding lower income people with unearned income is not a way to encourage such efforts.

Last of all, a defense of supply-side economics is in order. The greatest gains in real GDP in US history occurred between 1985 and 2005. This growth occurred in a period when the highest ordinary income tax rates and the capital gains rates fell substantially. This allowed the median US income (in 2003 dollars) to rise from approximately $39,000 in 1985 to about $43,000 in 2003. While this does not sound like much, this 10% increase represents a real increased standard of living for people who remained at the 50th percentile the whole time. Of course, one need not stay at the same percentile the whole time. Admittedly, the 80th percentile increased about 23% over the same time, and the 95th increased 18%. However, this simply represents the increased value that an increasingly productive economy placed on skilled labor over average ability levels. Thus, the rising tide indeed lifted all boats. Simply because some were lifted more than others does not mean supply-side economics failed.
October 22, 2008

6:32 p.m.

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HerbF writes:

Nobody redistributes wealth from the poor to the rich. The rich create wealth. The rich pay more in taxes today than they did before the tax cuts. The rich are not a static group. People routinely move in and out of different income brackets. Everyone needs to see opportunity to become rich and keep their own money. This is what makes the US a great country. The Soviet Union failed because there was no incentive to create wealth.
October 22, 2008

6:38 p.m.

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anderson writes:

A reasonable sounding argument boydz, but you slip in several claims for which you provide no support, namely:

--That business owners will stop producing once their tax rate reaches approximatley 50%. I'm sure the top rate has been higher in the past and that didn't stop growth.

--That current aid systems engender perpetual bums. Assuming there is some truth to this non-specific claim (and I'm not conceding any), and there are bums out there, and that they don't have any children to support, one must ask the question: do we design aid programs to benefit those in need OR do we design them to ensure that no one ever gets something they don't deserve even if that means shorting those in need?

--that there is no benefit to providing aid to lower income persons except maybe that they spend money thereby fueling GDP. The benefits to society of a safety mechanism isn't hard to figure out, is it? GDP or economic growth isn't everything.

--that the standard of living for the income American rose between 1985 and 2005. You cite income figures but don't say anything about inflation. Moreover, you don't mention the bottom half at all--which is where the problem lies, in my view. I don't begrudge rich people getting richer--but the poor getting poorer is a serious problem. Poverty arguably leads to most of societies ills. I don't see that all the boats got lifted. In fact, a lot of them are underwater as we speak.

Finally, any discussion of welfare, handouts, or perpetual assistance should include the benefits that businesses and corporations get from the gov't not the least, checks in hand--like to corporate farmers or to connected businesses like Halliburton. Not to pick on Halliburton but everyone knows who they are: I love how they "created" wealth (zero to a billion? in a few years) by persuading the govt to pay them for what the govt used to do itself. Having the govt as your client can sure have its advantages. What a business model.
October 22, 2008

6:49 p.m.

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ckravetz writes:

the argument made in the article lacks intellectual rigor i.e. it is unbalanced in its analysis. The effects of technology on one's earnings capacity comes very easily an simply to mind (one person programming a piece of software and then selling it 50 million times for $100) was not brought into the argument, but has been a tremendous driver of individual wealth. Further there was no mention of a specific piece of tax legislation and its effects, again, lacking rigor.

CRK
October 22, 2008

8:14 p.m.

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Kukulcan writes:

Exactly who is "redistributing wealth" to the Wall St WELFARE QUEENS?

Comrades Bush, Paulson and Bernake have arranged fat welfare checks for the Wall St WELFARE QUEENS!

* $29 billion to JP Morgan to swallow Bear Sterns

* $300 billion in earlier loans to Wall Street Firms

* $300 billion to the Federal Housing Administration

* $200 billion for Fannie and Freddie

* $87 billion to JP Morgan Chase for Lehman Financing

* $85 billion for AIG (Arrogance, Ignorance and Greed)

* $50 billion to prop up the Money Market Funds . . .

We can't feed and clothe all of America's children, but we can afford $60 billion to bail out Bear Stearns.

We can't provide decent medical care to America's seniors, but we can give $85 billion to AIG insurance.

We can't lift one finger to help out Americans losing their homes, but we can hand over up to $1 trillion to Fannie Mae and Freddie Mac.

We haven't the funds to provide proper care and support to American VETERANS, but we can afford up to $600 billion to buy pledged Lehman Brothers assets.

We can't do a thing to stanch to flow of jobs offshore and alleviate the suffering of out-of-work Americans, but we can hand $700 billion over to a guy who, until two years ago, ran the main problem-creating company: Goldman Sachs.

We can't afford to properly educate our children to fit into a changing America, but we can afford $3 trillion for a war that Cheney and Bush knowingly lied us into.

Prof. Joseph Stiglitz receiving his nobel prize for economics;

http://nobelprize.org/mediaplayer/ind...

Prof Stiglitz;

"THE Iraq war has cost the US 50-60 times more than the Bush administration predicted and was a central cause of the sub-

prime banking crisis threatening the world economy"

The 3 TRILLION dollar war

http://www.washingtonpost.com/wp-dyn/...
October 22, 2008

8:19 p.m.

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Hopefulin08 writes:

It is interesting to see the arguments made on behalf of the wealthy insofar as their respective tax burdens vs. that of the ordinary man. I only wonder how much that fortunate, 'productive' group would be paying in actual taxes, and in that vein, how much the U.S. Treasury would actually be receiving if only they paid their due without the myriad of tax loopholes. The whole notion of "income taxes" in this country is a joke. We have a wage tax which wage earners pay by hook or by crook whether they can afford it or not. The wealthy in no way pays an income tax. And that is precisely why they are getting richer at such a staggering rate.
October 22, 2008

8:26 p.m.

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Kukulcan writes:

Exactly who is SOCIALIZING the nations banking system?

U.S. to Buy Stakes in Nation's Largest Banks

http://online.wsj.com/article/SB12239...

Who is borrowing TRILLIONS from foreign countries to fund 2 wars -- while cutting taxes for the wealthiest Americans--running up the national debt to 10.2 TRILLION?

The estimated population of the United States is 304,957,567, so each citizen's share of this debt is $34,338.60.

The National Debt has continued to increase an average of $3.75 billion per day since September 28, 2007!

http://www.brillig.com/debt_clock/

GOP = BORROW AND SPEND!
October 22, 2008

8:39 p.m.

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furman72 writes:

Dr. Campos,

The explanation for wealth being on the move to the rich is basic math, or more specifically, what Einstein called the "Eighth Wonder of the World": compounding.

The reason wealth gets concentrated is compound interest or earnings. Wealth begats wealth.

For example if I have $50 million in assets and make 10%, my wealth grows by $5 MILLION. If, however, I have $50 thousand in assets, and make the same 10%, my wealth grows by $5,000. Let's see, same 10% return but a wealth concentration advantage of $4,995,000 to the wealthy person.

You may think that's unfair for some reason I can't fathom, but you certainly can't write it away.

Furthermore, the highest correlation between wealth and/or income is age. I am 58 and am worth a lot more than two of my boys who are starting out working at ages 27 and 25. I hope and expect that they "out-wealth" me by the time they are my age.

In my opinion, what we need to continue to work on as a society is to be sure that everyone gets as equal an opportunity as possible.
October 22, 2008

9:09 p.m.

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Glider writes:

Was anyone here around in the 1950's,'60's or 70's?
Do you remember how a lot of people lived then? Even a lot
of poor people where I live are doing as well or better than
what many considered to be middle class then. Wealth has
been distributed out but not all that much by the government.
Somebody has to create wealth which is something the
government doesn't really do. Something like the cell phone
which a lot of poor people own and which makes life better
was not created by the government. Over taxing the real wealth creators could prove to be counterproductive.
October 22, 2008

9:15 p.m.

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Glider writes:

Rainbow Warrior:
I live in one of those Red states. We have a huge amount of
military personnel and many bases. Are you counting that?
Also we have a hugh amount of poor low-income(mostly minority
welfare recipients). We have a hugh amount of agriculture
which gets subsidized.
October 22, 2008

9:31 p.m.

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Hopefulin08 writes:

FURMAN72, you are absolutely right. Wealth does beget wealth. $50 million x 10% = $5 million. Only that $5 million is INCOME and should be taxed as such. It is not. There are 1001 shelters to choose from for wealth earners, take your pick. Campos' argument wasn't that the wealthy shouldn't continue to earn, it was that they shouldn't earn at the rate they are by enjoying the sleight of hand of policies that support just the kind of wealth generation we are seeing. He simply calls into question the fairness of such redistribution of wealth (and it is redistributed when taxes which should be in Treasury coffers end up in the wealthiest bank accounts). If the so-called U.S. income tax system can take its pound of flesh from the guy who earns $30,000 in wages this year unfettered, why can't it likewise take it from the guy who earns $3 million solely through investments? By buying into the notion that the wealthy get to grow obscenely more wealthy just by virtue of where they started, you put your own sons earning potential at a perpetual disadvantage. I think their chances, and those of the rest of us might be better if everyone were required to play by the same rules.
October 22, 2008

10:59 p.m.

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jbowen43 writes:

Sarah Palin the socialist governor of Alaska is the most experienced at redistributing wealth. She put a windfall tax on the wealthy oil industry and spread the proceeds to the poor citizens of Alaska, every one of them in fact. No one has more experience at practicing socialism than Sarah Palin.
October 23, 2008

12:01 a.m.

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Kukulcan writes:

Glider writes:

"Also we have a hugh amount of poor low-income(mostly minority
welfare recipients."

Ahem, do you realize that the majority of welfare recipients are Caucasian?

Guess not!

Ignorance is bliss as the saying goes...
October 23, 2008

1:07 a.m.

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EIC writes:

Denverinfidel is WRONG and arrogant to boot about the EIC. He/she writes: "The EIC doesn't result in a check being sent to you. It results in your tax liability being lowered (your tax bill goes down). This is a large part of how the bottom third don't end up paying federal income taxes. They get "credited" back through the EIC. If you don't have enough liability (ie, owe enough in taxes), well then, thats it. You don't owe the gov't and the gov't doesn't owe you.

Under obamas plan, the difference of what you would have been credited towards your tax bill get sent to you as a rebate. Simple enough?"

WRONG Denverinfidel. The EIC IS a tax CREDIT. It is NOT a tax deduction (which is what you described). The government DOES send you a "rebate" check if you qualify. I know, I received the EIC for about six years because I was very low income (made $5000-10,000/year. BTW, like most low-income Americans, I worked my a-- off in those years. The reason most low-income Americans are poor is not lack of hard work (many of the poorest are the most hard-working, like farm workers) but their lack of scarce skills, and a slack labor market for all but a few professions (law, medicine,etc.), which require an enormous amounts of money/indebtedness. Education is certainly no guarentee of a decent standard of living nowadays. My family and I spent a bundle on college and more, but it was never enough to land a full-time job that paid enough to live on).

Anderson is right and Denverinfidel wrong that Obama's plan would be an expansion of the existing EIC. What Obama is dishonest about is claiming 95% of Americans would get a tax CUT. It would be honest to say that about 65% would get a tax CUT, and the 30% who don't pay income taxes now would get a tax CREDIT.

Again, a tax CREDIT, a tax DEDUCTION, and a tax CUT are all different things.
October 23, 2008

2:21 a.m.

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jugdish writes:

This is one of very few countries where just about anyone who's willing to work hard can change their socio-economic status dramatically. Are many going to become "super rich"? No. But who cares? How much money do you really need? Most of the "superrich" become so because of their already high net worth.
With modest investments and a return of 10%.. do the math on $100 million. It's staggering. What I see in this country is the ability to become a financially secure person through hard work, saving and thoughtful investments. Many in this country squander their money. They could build wealth but they don't manage it. I know a man who came here in 1974 from Laos. He had nothing.
Went to work for a restaurant as a cook and worked his way up. Raised a family and educated 3 children. Two of those children are engineers and a third is a CPA. All earn a nice income. As for their father, he now "owns" 5 restaurants. Owns 2 small apartment buildings. And has a net worth just over $2 million. That I say is amazing. Came here with nothing. NOTHING. Busted his a** and now is "financially secure". Oh, and he's so thankful for what he has (and in a way feels guilty for his success) that he set up an annual scholarship at his oldest son's university to help promising college students with meager means. As an immigrant myself I recently asked him for his take on this socialism talk. You'd think I punched him in the face. He said why can't people see how good they have it here and how simple it is to become financially secure with hard work, saving and sacrifice. He believes too few are willing to sacrifice and find it easier to hold out their hand and blame others for their woes. He's right.
October 23, 2008

3:20 a.m.

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ctampe writes:

For all you who believe in more "redistribution," let me just say, as one born and raised in Latin America, I have seen how inefficient, bloated Latin “socialist” governments wasted what little capital a country had, and scared off investors who could bring in income and jobs. Tell me, if the socialist notion "justice" through more income redistribution is so good, why do people live so awfully in countries like Cuba and Venezuela? Why do they on average live much better in countries with stable, free market economies like Chile and Costa Rica? Why is it that, after decades of impoverished Communist rule, countries like China or Poland are finally revving up their economies and raising their standard of living after embracing free market policies? The secret to lifting up the poor is not finding new means of income redistribution, it’s finding new means of income generation: jobs, small and large businesses, etc. That’s something your socialist ideals can’t create.

Paraphrasing a Cuban blogger (living under Castro): The poor loved Robin Hood because he took from the rich. But they soon realized that Robin Hood knew only how to steal wealth, not how to produce it.

And hey, nobody’s talking about abolishing the income tax. But in tough times like these, it’s hard to attract new investors or new businesses to create new jobs in your country if you make it ever so more expensive with higher taxes.
October 23, 2008

6:39 a.m.

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spencerr writes:

God forbid the rich keep a little more of the money they earned in the first place.
October 23, 2008

7:19 a.m.

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jonnyrotten writes:

Anyone who actually buys into this "redistribution of weath" from everyody else to the top 1% need to consider the the zero sum fallacy. I won't bore you with my opinion, but here is a like to shed some light on this subject!

http://www.promethea.org/Misc_Composi...
October 23, 2008

7:46 a.m.

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ctampe writes:

Those on the Left insinuate the rich do not "deserve" their wealth. They either gained it by somehow exploiting the poor, or inherited from their parents (who gained it by also exploiting the poor). Thus, as the rich never "earned" their wealth, those on the Left feel justified in taking it away. Their moral crusade seems less based on love of the poor, but hate of the rich. Why such resentment when faced with the rich? Is it envy?

Stereotyping the rich as all being capitalist free-loaders is as prejudiced as calling all the poor welfare free-loaders as well. There are hard working Americans at all economic levels, people who work because they know in the end they will be compensated for their labors. And any of them would feel less motivated to work if that compensation was minimized by higher taxes.

There's lots of conflicting data (as evidenced in this thread). The fact is, numbers don't lie, but statistics do. If you torture data long enough, it can be made to support any political agenda you like.

But look at the facts. Which are the fastest growing States in the Union? Not New York, or Massachussetts, with their high taxes. It's states like Arizona, or Texas, which enjoy a low tax burden. Globally, nations like China, Viet Nam, or Poland, are raising their standard of living by fostering foreign investment, which brings jobs and economic growth. Even socialists in countries like Brazil or Chile, have come to embrace free market policies, because they realized they worked.

Government has a role in regulating business practices, and maintaining a level playing field. It must also provide the tools, such as education, which help citizens gain the skills necessary to succeed in our competitive environment. Nobody is talking about laissez-faire business practices.

But to steer away from capitalism, to increase disincentives for growth at a time we badly need it, is economic suicide. In the end, the Left is correct in one fact: socialist policies will make us all equal, because we will all be equally miserable. Maybe then their envious thirst for "justice" will be quenched.
October 23, 2008

8:54 a.m.

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mytwosense writes:

furman72: "In my opinion, what we need to continue to work on as a society is to be sure that everyone gets as equal an opportunity as possible."

Me, too. And as I pointed out in a previous post, we've let ourselves get so fixated on the progressive tax structure, that things we could be doing to level out the *initial* playing field are routinely ignored/overlooked. If we could focus our concentration on that more, we'd start to see some results and maybe, just maybe, a fair discussion of a different tax rate would become a timely one.

But currently, we're not. We're mired in stupid discussions about a 3-point increase in taxes and Joe the Plumber. This is why things don't get fixed in this country anymore. Never have so many people gotten hung up on so many digressions that actually have little relevance to their every day lives.

I'd actually love to see the day when politicians shift from emphasizing breaks to one bracket or another to really hammering home the point, "Hey, let's see what can be done to help get people out of those low tax rates once and for all."

I still say that enforcing laws against monopolies would be a good start so we could make the playing field one where true competition exists. It's just one piece of the puzzle, but I believe an important one.
October 23, 2008

10:35 a.m.

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anderson writes:

Thanks for clarifying the EIC, EIC.

I'm still trying to figure out how Obama is proposing a redistribution of wealth as so many here have claimed but no one except dinfidel has made any attempt to specify. I see a lot of tired old and discredited laissez-faire bromides like "only the govt can create wealth". Yeah, I believe in Santa Claus too.

jonnyrotten, it's probably also fallacious to think that wealth (for the purpose of this argument confined to money) can continue to grow and grow, as the economic crisis is showing us now. All that speculative lending was good only so long as someone else could be found to take the debt.

I like how Enron "created" wealth. Or how the sub-prime lenders "created" wealth.
October 23, 2008

10:49 a.m.

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ColoNative writes:

Going from zero savings to $10,000 in savings is hard work. Going from $100,000 in savings to $110,000 in savings is inevitable. If you feel wealth-guilt, give it away, but do so silently. Expressing your wealth-guilt by promoting tax increases on the wealthy or promoting some sort of wealth redistribution plan via taxes does not eliminate wealth-guilt. It is a ruse. Poor people are not going away any time soon. Rich people are also here to stay. America's experiment is about something seldom seen in world history - it is opportunity. And don't give me the crap that only a few actually have opportunity. I started out as Lower East Side Pueblo trash. When I got turned down for a dish washing job at Furr's Cafeteria at age 23, I learned something. It was called opportunity and grace.
October 23, 2008

11:34 a.m.

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mytwosense writes:

ColoNative, is "wealth-guilt" the newest GOP interpretation of "good will"?

Sorry, this disparaging term still won't turn selfishness into a virtue.
October 23, 2008

11:47 a.m.

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spencerr writes:

Selfishness is not a virtue in and of itself.

Unfortunately, (or fortunately for those who would exploit the system) it is one of the cornerstones of the system that we generally thrive in at the moment. It is a characteristic of capitalism.

Government needs to take steps to keep the playing field even and to ensure ethical behavior, but otherwise, its presence is a retardant to to entrepreneurial behavior, especially when it decides to reallocate resources that would otherwise be spent on investment.
October 23, 2008

11:58 a.m.

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spencerr writes:

Capitalism functions by luring workers and entrepreneurs to engage their resources for the purpose of building wealth. If you are a little savvy, have a little capital, and are a risk taker, you are the biggest winner...you are a businessman or entrepreneur, and you will probably make some good money. The rest of us engage in the system via hard work.

There is a profit motive, an incentive for engaging our resources. When government taxes us...any of us, it relieves some of that incentive. Tax the rich (who have either directly or indirectly engaged their savings in entrepreneurial activities), and the result is incentive for risk-taking/investing going away, at least to a point. Likewise, tax workers, and they won't work as much.

Eighty percent of our economy is a direct result of this system. The other twenty percent (government...i.e. socialism), relies on the other eighty percent for funding.

Now, especially, is not the time to tax, even if you happen to disdain the rich. The economy is sputtering as it is. The first place that should take a hit...because it is not essential to our economy functioning, is government and programs. It will hurt the poor and non-essential government workers to not have the funding they need, but it will hurt the ability of our economy to recover more if we continue to support these programs.

Obama knows this, and he won't raise taxes until the economy can afford it...at least, he won't if he is smart. I would bank on it.
October 23, 2008

12:09 p.m.

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mytwosense writes:

I don' think Obama's plans to let the Bush tax cut on the highest bracket expire is motivated by a "disdain for the rich."

By the way, I find "disdain" an interesting choice of words. When I think of the word "disdain" I think of the word "snobbery." Really now, do you typically think of the rich as *victims* of snobbery?? We're going down the rabbit hole again...

Anyway, Spencerr, this country is in debt. Big time. We're fighting hugely expensive wars, and our infrastructure is badly in need of repair. More citizens will be qualifying soon for the social safety net programs that they paid into all their working lives. I guarantee whoever wins, taxes will be raised in some area to help us get out of the hole. Some may be lowered, but others will be assessed. Even Reagan raised taxes, most notably on the capital gains rate and I believe Social Security benefits (or extended the taxable SS base, can't remember).
October 23, 2008

12:29 p.m.

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spencerr writes:

MTS,

No doubt. You speak the truth. Everything you said is accurate. The entire nation just footed a 700 billion dollar bill funding financial institutions because they failed. We just eclipsed 1 trillion in debt.

My point is just that we can't raise taxes at the moment.

Despise, disdain, hate, look down upon...can you think of anymore synonyms? I have never been down that rabbit hole with you. I don't think that the poor have an uppety attitude toward the rich (at least, not in general. I am sure there are a few true socialists out there who do). Even if I did think this, it does not make the basis of any sort of strong argument on economics.

The infrastructure happens to be one of few "programs" requiring taxes with which I agree, military and vital services (not social programs) being the others.

I agree about the hard working American stuff you said too.

Let me ask you a history question though, since you seem to be pretty strong in this area;

Who structured one of our safety net systems, specifically social security, so that it would be put in one big pot...essentially a pyramid scheme that is completely dependant upon the population and economy continuing to grow? When that pot fails to grow, people who worked hard for their money our out on their butts. It is failing now (I am working hard for it now, but I am not counting on it being there in thirty something years when I will be ready for it). Answer, it has been this way since inception...FDR era.

Here is an interesting article on the problem that is social security...both parties are at fault.

http://www.nysun.com/opinion/stopping...

In my humble opinion, the answer to this problem should be that rather than using SS surpluses to buy bonds that the government turns around to fund programs with, the SS surpluses should be in an interest-bearing account (or something else safe that is certain to grow). What is your take? Raise taxes again like they did in the eighties to fund failing SS. Did that once. It just leads to more runaway government spending...aka socialism. Use the money for what it is for.
October 23, 2008

12:32 p.m.

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spencerr writes:

Let the surplus grow.
October 23, 2008

12:36 p.m.

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spencerr writes:

Besides, as a percentage of total GDP, even with two wars ongoing, military spending does not make the largest part of our federal budget. The same cannot be said for times past.

There are a lot of other things going on that are taking up our taxpayers' money (laughing out loud now, considering 10% pay 70%, and yet we call it taxpayers' money. should call it rich taxpayers money). They need to go away. We survived sixty years ago without these "government programs." Why can't we survive without them now?
October 23, 2008

12:49 p.m.

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anderson writes:

spencerr, Social Security has been pay-as-you-go since its inception. It's based on the silly idea I guess that people will continue to have babies, and there will continue to be a new supply of workers to replace the old. It is NOT a pyramid, which by its nature is doomed to fall. Last I checked, working, and wages were still in vogue, and it's been 75 years since the inception and Soc Sec is today in a surplus position.

One thing that happened in the 80s I believe, is that the Soc Sec's surpluses, which were considerable, were merged with the general budget--thereby putting something on the table that previously had been off the table.

Today's financial crisis illustrates the idea that banking your pension in the stock market has risk.
October 23, 2008

12:50 p.m.

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mytwosense writes:

Well, I think that Social Security is more solvent than we've been led to believe in recent years by those who wanted to transfer it's management to Wall Street. (Thank God that didn't happen!)

But the raiding on Social Security has got to stop, and both parties are guilty of it. As for your suggestion that surplus funds be left alone to grow, I can't find anything wrong with that! The question is, where.

But again, Social Security is not about to go bankrupt. It's not, not even close. Even with all the raiding.

Seriously, it's safer than some would have us believe. Social Security has regularly been making good on it's payments to Americans for well over half a century now. It's actually been an incredibly successful program in terms of providing Americans with a lowest possible risk annuity instrument. Try and find something comparatively reliable in your own investment portfolio if you have one.

I believe it will definitely be there 30 years to come, and indefinitely, if we manage it prudently (and yes, stop the raiding). But if we transfer it to Wall Street, it most surely will be gone, and so too will a lot of our retirement security.

Do you know that employee pensions reaped much better retirement plans than their eventual replacement, 401Ks? The average 401K at retirement now is something like $35,000. Can you even imagine trying to live off that for your remaining golden years without a monthly stipend from Social Security?

If the market performed as well as we've been led to believe, 401Ks would be a lot higher for more retirees. The main reason we switched to 401Ks was because it reduced the 7% employer contribution to 3%.

Yes, it cut costs for companies. And it drastically cut retirement funds for employees.
October 23, 2008

1 p.m.

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mytwosense writes:

spencerr: "We survived sixty years ago without these "government programs." Why can't we survive without them now?"

Take a look at the poverty levels of seniors sixty years ago and you may re-assess your feeling that we're worse off with these "government programs."

You appear to have a deep-seated hostility towards government. Is it government in general, or the American government?

I agree that with the bailout, the people just got royally screwed by their own government. But I don't think the answer to such bad management is to do away with management altogether. Theoretically, the American form of government is supposed to be a tool used by the people, for the people, and comprised of the people.

Rather than throw the baby out with the bathwater, let's make government beholden to the people who elect it again. Social Security is a perfect example. We entrust them to manage that money, let's demand they manage it right. In the end, that will be a hell of a lot cheaper than spending trillions to transfer it's management to the legalized casino called Wall Street.
October 23, 2008

1 p.m.

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spencerr writes:

We are mostly in agreement on social security. One last thought. What happens if our population ever does like those in Europe or Japan, and actually begins to shrink? Because social security has been continuously raided and in such a situation the old who should be receiving benefits would completely obliterate the funds, it will fail. They need to stop using it to fund projects.

On 401Ks, I give a slightly different perception. They undoubtedly grow. They, however, are also risky. You never know when the economy will take a dip, and if it does so while you are within five years of retirement, you are screwed. On the other hand, if you paid into it throughout the seventies, eighties, and nineties, and you used it during the 2000s (until now), you did well for yourself.

Anyway, employee pensions vs. 401Ks...pensions definitely used to be safer, at least until it became obvious that if a company was about to go under, the pension and the retirees who depended on it would be the first victims.

...I honestly don't know what the answer is for the poor trying to retire. A good starting point would be for those in my generation to save instead of buying big screen TVs and RVs and then going bankrupt by the time they are thirty. ...the crux of that is that if saving became part of our culture as Americans, the economy would not grow as rapidly as it normally does.
October 23, 2008

1:06 p.m.

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spencerr writes:

MTS,

I don't hate all government. I don't even hate all forms of "socialism." However, it goes back to my 11:58 pontification. It is all about choices. There is definitely a trade-off in economic prosperity when we move money from production of goods and services into government. On the one hand, you have your safety net. On the other hand, you have your overall economic well-being. They are at the expense of each other, at least on the surface.

Anderson, pyramid scheme was a bad choice of words...no better than a pyramid scheme, however, if the politicians keep raiding it and the population ever does stop growing.
October 23, 2008

1:09 p.m.

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spencerr writes:

Anyway, MTS,

According to my world economic development class, there are certain things that have to be true about the structure of our society for the economy to function well; we need good property rights and enforcement, a good court system, an educated population, and a healthy population.

We currently meet the basics of all of these (although in support of your point, I read somewhere that as little time ago as the early 1920s, median population age was as low as 49 years old...maybe government programs have helped a bit!!! ;).

So, government is necessary at some level to keep the above-mentioned aspects at an adequate level, though I believe that keeping market structures in at least the latter two of the government functions would better serve the American people.
October 23, 2008

1:20 p.m.

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spencerr writes:

MTS,

Nice having a peaceful, mostly unemotional conversation with you. It doesn't always have to lead one to walk away hating everyone with the opposite political leanings! I find that if you leave the rhetoric (mostly) at home, things can be much more peaceful. Rhetoric, as long as it is based in fact, is okay, but it is not persuasive to those who believe otherwise.

Likewise, Anderson, good to hear from you too without getting into mundane arguments about whether or not the mainstream media is liberal.
October 23, 2008

1:27 p.m.

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mytwosense writes:

I wouldn't want to see government take over the means of production in many areas, but I think with schools, they've done an overall decent job in basic education. However, there is vast room for improvement, which I don't think we will see until there is a considerable shift in opinions about education on the part of the public. I think we've talked a bit about that in the past, these are more opinions related to the role public education should play in preparing our children for adulthood.

Also, school has become a de factor babysitting service. I think we keep kids shut up in school too long every day. There are other forms of education that are critically needed, and frankly, kids should just be allowed to be kids more. They can't really get that in an institutional setting.

I wish kids only had to go to school four hours a day, tops.
October 23, 2008

1:36 p.m.

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spencerr writes:

A couple of things on education...once I desired to become educated specifically in the economics of education...besides the piont. It never happened, but I did write some papers on it.

Poverty is largely a cultural thing, and both poverty and culture interact with education. I think that to make socialized education better, they need to introduce the market structure (vouchers). It will create competition among everyone. It may make someone rich or have the side effect of benefitting the wealthy along with the poor, but the profit motive and its counterpart, the fear of failure, are powerful things. You could structure public education to be competitive and greatly improve it.

Ideally, parents would take a larger part in their kids educations though. My only fear when it comes time to educate my daughter is that she won't get enough socialization. I guess soccer and ballet would make okay substitutes for school.

Anyway, the culture and poverty thing. I think a lot of poor parents (by no means am I including all poor parents) look out for themselves moreso than for their kids. Public schools (for many) is, like you said, a babysitting service. When they are at home, they don't take enough part in their children's lives. The children don't have a chance. That is not on society though. That is on individuals.
October 23, 2008

1:37 p.m.

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spencerr writes:

You are right, though, public education has overall done a decent job. Decent. It's not good enough though.
October 23, 2008

1:41 p.m.

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spencerr writes:

Pride, self respect, and selfless love for one's children are the ingredients for educating our children. The question is, how to instill these aspects in people who have problems and that bankrupt them of at least one, if not all three, of the above attributes.

Immigrant Asians are my paradigm of hope. Poor black and latino families are my vision of present day reality. Culture is soooo important to poverty, culture and education.
October 23, 2008

2:09 p.m.

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spencerr writes:

Anyway, hope I didn't come off as racist. Have a nice weekend.

I'll talk to you both later, though circumstances will make communication from me on here few and far between.
October 23, 2008

2:14 p.m.

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BigSky182 writes:

I am confused.... isn't working hard, building wealth, and becoming financially secure the "American Dream"?

When did aspiring to become wealthy become a sin?
October 23, 2008

2:20 p.m.

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anderson writes:

spencerr, what does "white" culture say about poverty and education since there are a lot of impoverished white kids and drop outs? I'm with you that pride, self-respect and those things should be instilled in children but I don't think that telling kids they're flawed because they're black (that message is out there, including your remarks) is gonna do it. I think everyone *wants* to be somebody and given half a chance will succeed. But if your family has never known anything but poverty, and your parents are uneducated or on drugs, you're starting waay behind the curve. A really critical period in development, or so I understand, is from birth to age 5. And what are we as a society doing about this? A little something? It's fine for those whose circumstances are better to invoke notions of Horatio Alger but I think they're way oversimplying matters and missing some of the reality.
October 23, 2008

2:20 p.m.

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mytwosense writes:

spencerr, lots of interesting thoughts to ponder, but I too have to jet for the day. I hope we'll run into each again on the forums, but it's probably good for you to take a break, regardless of the reasons why. I know they're good for me! You're one of the few conservatives I can have a non-hostile conversation with.
October 23, 2008

2:22 p.m.

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spencerr writes:

BigSky,

It is a sin for some people. Has been since the rise of Karl Marx...not that everyone who thinks this way is a marxist.
October 23, 2008

2:26 p.m.

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anderson writes:

spencerr, yes, slow growth or declines in population growth are an issue for Social Security and it's something we have to plan for in the future. I think it can be done. I don't think the designers were flawed in choosing pay as we go.
October 23, 2008

2:27 p.m.

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spencerr writes:

anderson,

Easy solution. Stop raiding it. Get your money from elsewhere, or don't spend.
October 23, 2008

2:33 p.m.

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anderson writes:

"When did aspiring to become wealthy become a sin?"

Not that anyone here said it was a sin, but since you asked, the idea goes back at least to the time of Jesus when he said the man clinging to his possessions will easier pass through the eye of needle than he will enter the kingdom of God. Jesus also threw the money changers (impious payus dayus, credit cardus, and sub primus) out of the temple for some reason.
October 23, 2008

2:33 p.m.

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spencerr writes:

anderson,

That wasn't my message, though I worried you or someone else might take it that way. I was using people from those cultures (perhaps unfairly as a general stereotype) as examples of the extreme end of educational success. Whites fall somewhere in between, and I did not mean to suggest that there is any sort of racial divide. Anyone can be poor, and I think the causes are often the same.

You said, "But if your family has never known anything but poverty, and your parents are uneducated or on drugs, you're starting waay behind the curve."

This was my point when I said, "The question is, how to instill these aspects in people who have problems and that bankrupt them of at least one, if not all three, of the above attributes." Pardon the extra "and" that shouldn't be in there "before that bankrupt". --I wasn't talking about instilling it in the kids, though they need to know it eventually. I am talking about their parents. Without these attributes, the parents won't assure their kids the best education possible.
October 23, 2008

2:36 p.m.

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spencerr writes:

Has anyone ever studied why the descendants of Asian Americans are more affluent than European Americans who have been around and owned the scene forever?

Contrarily, has anyone ever studies why other minorities have never met the same successes?
October 23, 2008

2:39 p.m.

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spencerr writes:

Anyway, Anderson,

Poverty is a cycle, and education (or lack there of) plays a role in the cycle. How does one break that cycle? How can you make the majority of poor people look out for their kids' educations?

Some do, but many don't.
October 23, 2008

4:23 p.m.

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denverinfidel writes:

Just looked at this and saw the arguments are still flying. According to the IRS site, EIC is right, some may get a refund due to the eitc.

EIC/Anderson – I stand corrected, and apologize for arguing a wrong assumption. I had no idea the eitc could result in a rebate.

That doesn’t change the argument that obama is being misleading, at least, and why we desperately need to simplify the tax code. Why confiscate wages from the working poor (the “earned income” portion, because you do have to work to qualify) only to rebate it later? Because politicians lose power without the money flowing through them. You’ll notice they are all fans of credits, but not too many support true cuts. EIC – none of my business, but your example is puzzling: working you’re a** off for six years and only making $5-10k/yr? Doesn’t add up.

I don’t see where I claimed the poor don’t work hard. I was raised by a single mom in the same boat, I’ve worked plenty of construction and crap jobs to educate myself, and seen many laborers who break their backs for low wages. I said if you want to be rich, emulate those who are. Hard work, a h.s diploma, higher education, sobriety, frugality, saving, avoiding single parenthood, etc etc all contribute to staying above the poverty line. There are obvious and direct causes that lead to poverty in this country, and a path to avoiding it. Punishing success does nothing for society but assuage some peoples guilt. Many posts on this site have already made this point better than I.

I also never claimed obama’s plans were an expansion of the eitc (but your explanation now makes that seem like a more accurate description). He refers to everything as a “refundable tax credit”. Under this terminology, any payment from the gov’t can now be called a tax credit, even when no recipient is paying taxes. His 95% claim (the original point of my redistribution argument) is an outright lie, as you’ve proven. Its as false as mccain claiming he will balance the budget in 4 years.

You stated a cut, credit and deduction are all different things, which is true. So how do 65% get a tax “cut” under his plan? Which bracket gets cut? None - he isn’t offering that. Its all done through varioius “credits”, and we’ve established that is very different from a tax cut.
October 23, 2008

5:49 p.m.

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Derge writes:

Campos, I'll be posting later tonight that which will demolish your entire argument. I've posted this same information before on RMN.

Apparently you don't read the opinions here, do you?

Or do proper research, for that matter.
October 23, 2008

8:38 p.m.

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jay writes:

i still can't believe we have folks around who believe that we won't have to raise taxes...and relatively soon...to start paying for the bill of the last 8 years.

if we're gonna start cutting places...let's start by increasing oversight on all defense spending, followed closely by increasing oversight on all corporate welfare spending.
October 23, 2008

9:03 p.m.

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mmannino writes:

Campos's claim is outrageous. He is economically illiterate. Redistribution is a government function. Excessive taxation is just redistribution. Private indivduals do not have the power to redistribute wealth. Markets involve exchanges by willing buyers and sellers. The increase in wealth was created by private individuals. You do not need to start a business or build a factory create wealth. You can invest your money and let others create things.

The Democrat soak the rich scheme is immoral and counterproductive. It is immoral to expect 5% of the population to pay for proposed government programs. If these programs are worthwhile, everyone should contribute. This tax scheme is just an immoral vote buying scheme.

The proposed tax increase will not work as the Democrats would like. The increases in marginal rates are so large that a silent tax revolt will occur even by individuals in this group who vote for Democrats. The target of this tax increase will work less, produce less, invest less, hire less, and attempt to evade taxation. Capital will continue is movement to other parts of the world. Many wealthy individuals will move their assets and residence to other parts of the world. The Democrats are appealing to the masses by offering a free lunch. The public will see over time that there is no free lunch.
October 23, 2008

9:04 p.m.

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Derge writes:

Supply-side (SS) economics is a proven model to increase economic growth and benefits the country as a whole. There is some recovery of the initial loss of revenue due to tax cuts, albeit not fully. This is why the model must be accompanied by a reduced federal annual budget. This in turn creates a surplus, allowing the government to reduce the national debt.
http://taxesandgrowth.ncpa.org/resear...
This is the goal of conservatives and the basic foundation to my economic policies.

Trickle-down (TD) economics takes the SS model but assumes that the initial revenue loss is recovered not only fully, but increased above pre-tax cut levels. TD is usually accompanied by an increased federal annual budget. This increases the budget deficit and national debt.
This is the goal of neo-conservatives. (Keep in mind that term refers to Democrats that became Republicans).

However very often we hear of such statements made that "the rich getting richer and poor getting poorer" under such economic plans. This is a fallacy due to a lack of understanding economics.
http://www.importanceofphilosophy.com...

Now allow me to provide some intriguing data that supports dimissing said statements that, "the rich getting richer and poor getting poorer":

Income Mobility tracks how people fare based on their tax returns over time. Broken into quintiles (1/5), here is how people's income moved from 1996 to 2005 in comparison to one another:
Lowest – 57.6% moved up, 42.4% stayed in the lowest quintile
Second – 49.7% moved up, 17% moved down
Middle – 42.1% moved up, 24.6% moved down
Fourth – 30.2% moved up, 29.7% moved down
Highest – 30.6% moved down
Top 1%, 57.4% moved down
October 23, 2008

9:05 p.m.

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Derge writes:

Key findings from the study include:
• Substantial income mobility: More than half (56 percent in the table1) of households moved to a higher or lower income quintile between 1996 and 2005.
• Substantial movement out of the bottom quintile: Roughly half (58 percent (57.6 = 100 – 42.4)) by the measure used in the table and 45 percent by another measure reported in the study) of the households initially in the bottom 20 percent of the population moved to a higher quintile by 2005.
• The very high income are an ever changing group: The very high income – the top 1 percent – is a group whose composition changes substantially over time, rather than a fixed group of individuals who receive a larger share of income over time. More than half (57 percent, (57.4 = 100 – 42.6)) of those in the top 1 percent in 1996 had moved to a lower income group by 2005.

Further findings from the study:
• Over two-thirds of households (70.1 percent) increased their real incomes between 1996 and 2005, and median household after-tax income increased by 28.6 percent.
• Increases in real income were the largest for households with the lowest incomes in 1987.
o Among households in the lowest income quintile in 1996, median income increased by just over 90 percent by 2005.
o Real incomes increased over the period for nearly 82 percent of these low-income households and at least doubled for almost half of this group.

(http://www.treasury.gov/press/release...)

Now I would like to provide some information that dimisses the idea that conservative economics creates higher income inequality (the amount of money between the richest versus poorest). Providing an analysis of two presidents with two full terms in office the data shows under the Democrat, the income inequality grew 4.963 TIMES that of the Republican:

"The income inequality the percentage grew from 14.67 %(1992) to 21.52% (2000) under Clinton, a growth of 6.85 %.
Yet under Bush II it grew from 21.52 (2000) % to 22.90 % (2006), a growth of only 1.38 %." http://elsa.berkeley.edu/~saez/TabFig...

(Income inequality researched & provided by, and with full thanks to, Steve Petrie here: http://www.rockymountainnews.com/news...)

Given the recession of 2000-2001 (http://www.bea.gov/briefrm/gdp.htm) the tax cuts of Bush II (2001;2003), guided by the policies of conservative economics, clearly show that even the lower & middle class, in addition to the upper class, received a tax cut and assisted in returning the U.S. economy back into growth: http://www.taxpolicycenter.org/number...
October 23, 2008

9:22 p.m.

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mmannino writes:

mytwosense,

You are misinformed about Social Security and Medicare. Both programs are generational Ponzi schemes doomed to failure. They also have substantial welfare components. The failure of these programs will not be like failure of private pensions or even state/local government pensions. Rather the failure of these programs will involve the economic health of the country.

The money to support baby boomers' retirement has already been spent. Excess payroll taxes continue to be spent until there are no more excess taxes. Substantial benefit reductions are coming either directly or indirectly. Direct reductions may involve combinations of increased retirement age, lower benefits, and higher taxes on benefits (essentially lower benefits for benefits that are just return of payroll taxes). Indirect reductions involve inflation, unemployment, lower economic growth, and falling investment values. I prefer direct reductions because they are more predictable. As we see in the current economic crisis, indirect reductions may be chaotic. However, I believe that indirect benefit reductions will occur because of political pressure of direct reductions.

The issue of partial privatization of Social Security was badly misrepresented by the Democrats. With privatization, you would control your contributions. You could invest it any way that you want. With government control, politicians spend your contributions. Even if you invested your contributions in very conservative investements, you would still have something. Political control ensures that your contributions will be spent today rather than saved for tomorrow.
October 23, 2008

9:56 p.m.

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Derge writes:

mmannino, I would like to add to your post.

Social Security; doesn't work, isn't working, won't work in the future.

An anology to Obama's healthcare: Social Security

Enought to not vote for him.
October 24, 2008

10:55 a.m.

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anderson writes:

Derge: "Social Security; doesn't work, isn't working, won't work in the future."

Tell that to the American people who've lived with the program for over 70 years. Oh wait, you don't really care what they think. You are an ideologue. Like a religious fundamentalist, you think you hold THE truth and despite evidence all around you of widespread disagreement, you make these nonsensical assertions because you hold THE truth. It's a good thing we live in a democracy and not Derge's despotacy.

mmannino: "You are misinformed about Social Security and Medicare. Both programs are generational Ponzi schemes doomed to failure"

Hmm. You evidently don't know what a Ponzi scheme is, or how Social Security is funded, or both. Or, maybe you just don't care about truth, accuracy, or reason.
October 24, 2008

10:57 a.m.

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anderson writes:

Derge writes: "Supply-side (SS) economics is a proven model..."

What is this, an infomercial? A political ad?
October 24, 2008

12:40 p.m.

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jay writes:

lol....two failed tries at trickle down economics and the footsoldiers are still dancing to the drum...

that's blind loyalty my friends.
October 24, 2008

5:16 p.m.

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Derge writes:

I wish I could laugh but it's not funny 'haha' when Anderson and Jay attempt to budge into a discussion. Could it be? Yes, they have NO SUBTANCE! What a pathetic pair indignant children.

Try again, little boys.
October 24, 2008

10:40 p.m.

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jay writes:

"substance" like trying to sound the trumpet for failed policies, derge?
October 27, 2008

1:28 p.m.

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gary writes:

>> In a local restaurant my> server had on> >> a "Obama 08" tie, again I laughed as he> had given> >> away his political preference--just imagine the> coincidence.> >>> >>> >> When the bill came I decided> not to tip> >> the server and explained to him that I was> exploring the> >> Obama redistribution of wealth concept. He stood> there in> >> disbelief while I told him that I was going to> redistribute> >> his tip to someone who I deemed more in need--the> homeless> >> guy outside. The server angrily stormed from my> sight.> >>> >> I went outside, gave the> homeless guy> >> $10 and told him to thank the server inside as> I've> >> decided he could use the money more. The homeless> guy was> >> grateful.> >>> >> At the end of my rather> unscientific> >> redistribution experiment I realized the homeless> guy was> >> grateful for the money he did not earn, but the> waiter was> >> pretty angry that I gave away the money he did> earn even> >> though the actual recipient deserved money more.> >>> >> I guess redistribution of> wealth is an> >> easier thing to swallow in concept than in> practical> >> application.> >> >> >> >> >
October 27, 2008

1:32 p.m.

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oatis writes:

Again, I apologize, fellow bloggers: I always skip straight to the bottom, choosing only to address the sustance of the author's column and to ignore the boundless repository of wit and profundity that must be contained in the endless paragraphs above. Only a half-hour for lunch, don't you know.

So anyway, has someone already commented on the obvious fact that the largest, most lopsided and least deserved wealth distribution in HUMAN history is now underway? Of course, I refer to the hand over of hundreds of billions as-yet-unprinted dollars owned by honest taxpayers to the very same fabulously wealthy, profligate and fundamentally immoral persons who, though their greed, caused the ruin of the American economy.

"Socialism" don't hold a CANDLE to THAT kind of re-distribution!
October 27, 2008

5:11 p.m.

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macrmn writes:

anderson- you have no understanding of social sec financing- pay as you go for ss requires a growing work force with at least a stable income level (or a stable workforce with pay increases). The current plan is most like a ponzi scheme. If the left gets the population control it wants, the system will face severe difficulties. There is no ss investments/savings at all and all current workers have no guaranteed ss savings nor income, they only get what congress approves.

Home › Opinion › Opinion Columns & Blogs

CAMPOS: Wealth on move - to the rich

By Paul Campos, Rocky Mountain News (Contact)

Published October 21, 2008 at 6:12 p.m.

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