Inequality is on the Rise in America; the Ruling Class Has Redistributed Private Sector Middle Class Wealth to the Public Sector Until They Finally Redistribute It All to ThemselvesThere is a real “war” taking place today: an economic war, which has been instigated by the ultra-wealthy, prosecuted by the U.S. government, and directed at the American people. Having already robbed Americans of their political power through the establishment of the Wall Street-owned, two-party dictatorship, the Oligarchs now want to rob the people of their last vestiges of “economic power” -- in order to turn Americans into “serfs,” which they consider to be the only rightful place for the “little people.” - Jeff Nielson, The Plundering of America, March 7, 2010
Even if the U.S. government expropriated every dollar of private wealth in the nation, it would still have a deficit of $66,600,000,000,000 ($66.6 trillion), equal to $214,286 for every man, woman and child in America and roughly 500% of GDP. If the government does not directly seize the nation’s private wealth, then it will require $389,610 from each and every citizen to balance the country’s books. - Stewart Dougherty, America’s Impending Master Class Dictatorship, Kitco, January 22, 2010
History has proven to tyrants that oppression works. In fact, it is easy to control a populace, once you control the money, markets, military (including police), media and minions (the recipients of welfare, social security, free health care, government jobs and the like, who are dependent upon the state and likely to be compliant). This is exactly where the United States is today. - Stewart Dougherty, America’s Impending Master Class Dictatorship, Kitco, January 22, 2010
“When the people find that they can vote themselves money, that will herald the end of the republic.” - Benjamin Franklin
April 1, 2011
It's most welcome news that job growth seems to be picking up again--even if we'll need a whole lot more of it to get back to where we were before the Great Recession.
Still, as we've reported, there's growing evidence that the new jobs, many of which are in sectors like retail, food services, and health care, simply aren't as good--in terms of wages, hours, and seniority--as the ones they're replacing. And a report released today only adds to the concern.
The study, commissioned by the nonprofit group Wider Opportunities for Women, looks at how much income it takes to support a basic standard of living for an American family--and finds that many of the jobs of the future won't pay enough to provide that.
To calculate this "economic security" income, the study's authors certainly didn't assume a lavish lifestyle. They considered basic needs--housing, food, utilities, health care, child-care, and transportation--plus the cost of modest saving for retirement and a small surplus for emergencies. (At at a time when economic "shocks" are increasingly common, that's an essential part of financial security.) They don't factor in some things many of us take for granted, like entertainment or eating out.
The result? To achieve economic security, a single parent with two children needs an income of just over $30,000 a year--nearly twice the federal minimum wage--while a two-income household needs almost $68,000.
The study then finds that, according to Labor Department projections, fewer than 13 percent of jobs to be created by 2018 will meet the economic security threshold for a single parent with two kids. Forty-three percent of those jobs will meet the threshold for a two-income household.
In other words, most of the jobs of the future aren't likely to pay enough to offer the kind of stable, middle-class existence that for much of the 20th century was seen as the American birthright.
"The American Dream of working hard to support your family is being re-written by the growth of low-paying industries and rising expenses," said Joan Kuriansky, WOW's executive director.
Indeed, this seems to be the new reality of the American economic landscape. Gary Burtless, an economist with the Brookings Institution, noted in a statement on the government's jobs numbers that real earnings fell 1.1 percent between October and February--a development he attributed to the still-high unemployment rate, which is eroding workers' bargaining power.
April 1, 2011
Just a week after the report that bonuses for CEOs jumped 30 percent last year comes another startling statistic that illustrates the ever-increasing gap between rich and poor in America: overall CEO compensation increased by 27 percent in 2010, while the pay of the average worker grew only 2 percent, according to a USA Today analysis of data from GovernanceMetrics International.
Perhaps it's fitting that, as the Columbia Journalism Review points out, the Business section of today's New York Times reads like a "snapshot of the gilded age economy." Stories in the April 1 section include one on the $17 million paid to the CEOs of Fannie Mae and Freddie Mac in 2009 and 2010--fresh off the taxpayers bailing out the two lenders to the tune of $150 billion--and another on the multi-billion dollar lending program the Fed used to save the likes of Fannie and Freddie.
In other U.S. news, outside of the Business section, the Times devotes another piece to the state of Florida's efforts to cut unemployment benefits considerably, featuring a jobless man so desperate that he recently sold his handgun for money, and, he says, to avoid blowing his brains out.
"I am just so depressed," he told the paper.
April 18, 2011
Happy Tax Day! With an odd element of fanfare, the Associated Press wants you to know one thing about America's tax code: it's broken and everybody knows it. In all, the Tax Policy Center estimates that 45 percent of U.S. households will not pay any federal income tax this year.
"The vast majority of those who escape federal income taxes," writes the AP, "have low and medium incomes, and most of them pay other taxes, including Social Security and Medicare taxes, property taxes and retail sales taxes."
But much of the AP's focus is on the few wealthiest Americans, who because of numerous loopholes in the tax code rarely end up paying the oft-quote top tax rate of 35 percent. The AP quotes one Columbia Business School professor who manages to pay only 1 percent of his six-figure income to the federal government. On average, the wealthiest Americans pay only 17 percent of their income in taxes, a dramatic decline from the 26 percent they paid in 1992.
In his speech last week, President Obama vowed to limit tax breaks, especially those for the wealthy. It's bound to be a political challenge as some of these breaks affect low and middle-income Americans, 45 percent of whom pay no federal income tax whatsoever. But The Daily Beast's John Avalon thinks the president stands to gain ground in the tax battle with a quick fix. Rather than compare Warren Buffett's income with those on the bottom rungs of the top tax bracket--an income of roughly $125,000 a year--Avalon thinks we should get reasonable about taxing the ultra rich:
A smarter option would be to recognize the increasing wealth disparity in America and adjust the top rate accordingly—raising it to $500,000 or even $1 million per year per household. This would match the Democrats’ “millionaires” rhetoric with reality. It would also be politically impossible for Republicans to oppose at a time when we need to pay down our deficit and our debt.
Along these lines, Treasury Secretary Tim Geithner let America know yesterday that we'd have to raise the debt limit. Geithner agrees that tax reform needs to be focused on closing loopholes for the wealthy in order to make a dent in the deficit. He told Christiane Amanpour:
Those benefits, even like the mortgage interest deduction that lets people have two homes, pretty expensive homes … if you target them on the most fortunate Americans, they can afford to take a little bit larger share of the burden. They can afford to do that, and it's the responsible thing to do for the economy.
Not that any of this news makes you more excited to pay your taxes today.
April 17, 2011
As Monday's tax filing deadline nears, ponder this: The super rich pay a lot less taxes than they did a couple of decades ago, and nearly half of U.S. households pay no income taxes at all.
The Internal Revenue Service tracks the tax returns with the 400 highest adjusted gross incomes each year. The average income on those returns in 2007, the latest year for IRS data, was nearly $345 million. Their average federal income tax rate was 17 percent, down from 26 percent in 1992.
Over the same period, the average federal income tax rate for all taxpayers declined to 9.3 percent from 9.9 percent.
The top income tax rate is 35 percent, so how can people who make so much pay so little in taxes? The nation's tax laws are packed with breaks for people at every income level. There are breaks for having children, paying a mortgage, going to college, and even for paying other taxes. Plus, the top rate on capital gains is only 15 percent.
There are so many breaks that 45 percent of U.S. households will pay no federal income tax for 2010, according to estimates by the Tax Policy Center, a Washington think tank.
The sheer volume of credits, deductions and exemptions has both Democrats and Republicans calling for tax laws to be overhauled. House Republicans want to eliminate breaks to pay for lower overall rates, reducing the top tax rate from 35 percent to 25 percent. Republicans oppose raising taxes, but they argue that a more efficient tax code would increase economic activity, generating additional tax revenue.
President Barack Obama said last week he wants to do away with tax breaks to lower the rates and to reduce government borrowing.
In all, the tax code is filled with a total of $1.1 trillion in credits, deductions and exemptions, an average of about $8,000 per taxpayer, according to an analysis by the National Taxpayer Advocate, an independent watchdog within the IRS.
April l 8, 2011
But very few of them capture what's happened over the last 30 years or so as well as this image:
Put together by the Center on Budget and Policy Priorities, a liberal Washington think tank, the chart is pretty self-explanatory. It shows that the 30 years following the Second World War were a time of broadly shared prosperity: Income for the bottom 90 percent of American households roughly kept pace with economic growth.
But over the last 35 years, there's been an abrupt shift: Total growth has slowed marginally, but the real change has been in how the results of that growth are distributed. Now, the bottom 90 percent have seen their income rise only by a tiny fraction of total growth, while income for the richest 1 percent has exploded by upwards of 275 percent.
One can argue about why this is happening. Some say it's the result of a decline in workers' bargaining power as labor unions have weakened, while others blame the rise of offshoring and outsourcing. But despite the best efforts of some commentators, there's really no serious debate about the overall realignment of income in our age: The already super-rich have vastly increased their share of the pie--at the expense of everyone else.
This article explains why prices keep going up for all of us and why jobs are difficult to find with businesses hiring people for starvation wages overseas -- so the very rich can keep getting richer at the expense of the rest of us. I can't understand why some of you can't seem to grasp this reality! - Byline
The truth is, I am making the same wages my dad made 25 years ago, when he was about my age and had similar education and experience. And the story's true for everyone else I know. While a $35K salary was a handsome wage in 1986, it's not so hot in 2011. Employers have refused to push up wages unless they are mandated to do so. - MahenjoDaroen
The problem is that for all their flag-waving and claims of patriotism, Republican businessmen have no reservations at all about shipping American jobs overseas, if they can make a slightly higher profit. They also structure tax laws so that they can "write off" most of the day-to-day living expenses the middle class has to pay full price for (company car, jet, living accommodations), lowering their tax burden even further. Then they bribe ("Campaign contribution") their Congressmen into lowering their tax rates still more. As a finishing touch, they blame teachers, firemen, and policemen for being so greedy as to expect medical care and retirement benefits. - Art Ghecko
Last time I checked corporations use roads, police, fire departments, eat subsidized foods, use subsidized energy, municiple water, and all of the other services that are provided by our government. There is no excuse for them to not pay for those services. Especially when they spent last year paying less taxes than they have in the last 40 years, producing less jobs than they have in the US, and outsourcing more jobs. - Phil
The percentage of total national tax revenue on corporations was 33% in the 50's... now they pay only 6.6%! The top marginal tax rate (rate paid by the super rich) was 91% in the mid 50's - now they're only paying 33% and freaking out at any talk of taking it up to 36%. The problem in america is the greed of corporations and the super-rich. - Robin
Every time money is borrowed, it adds up to billions and trillions. The interest on that is unthinkable. Somebody is earning it. For every money you and the government borrows, someone is receiving it. So of course the divide is huge. That debt obligation to the people, in one form or another, ultimately results in higher taxes to pay off the principle and interest. Right now the American people are nearly half a trillion in interest every year on the national debt. Someone is earning that interest. It is not the people; the people are drowning in debt and higher taxes. Keep thinking the system works, and keep thinking you will beat the system, win the race; but in the end, it does not work. It depletes people and resources. It consolidates power into fewer hands. - Anonymous
Simplest solution for Social Security's budget? Remove the 30 year old earnings cap on Social Security taxes, reduce the tax percentage a few points, and have all earned income taxed for Social Security without a cap. Income caps that cut off Social Security taxes after $106,000 in earned income allows those who make the most to proportionally pay the least. - Maureen
This is one problem I see: People give a certain amount of their income to savings accounts and investments taht a bank decides to use to provide capital to a company or corporation. That worked once. The company was local and the investment you made went into the community providing jobs and if successful paid a dividend. It is not like that now. Instead your account is invested in companies that you know little or nothing about. The seed corn you provide them is planted somewhere else and it is not reinvesting in your community. You personally may make a profit but at the expense of your community that is not gaining collectively from these initiatives. How is that generating jobs in America? What happens when we become a nation of consumers and do not reinvest and fertilize the common ground with our common wealth? We do this in the form of shared taxes to keep infrastructure going and in the form of real labor and productivity, producing tangable things. Not just remore speculation and investments by proxy that pay off in the short run. Long term these things are hurting us. - Bob M
That chart should be shown constantly to everyone who will look. Clearly, the uber-rich have figured out how to steer all the money their way. My guess is they had a lot of political help in making that possible. They've been shown a lot of favoritism by congressmen and governors. - Bill
Today the Darned Rich GOP and Tea Party Liars are going to shut down parts of our Government in order to fulfill their agenda for drummer students and even poorer poor and middle class. They are holding America Hostage because of a Budget problem they themselves created during the past Republican administrations, robbing S.S. to give to these hard-put 1% Rich and the no tax, to near no tax to the Rich and Corporations, as well as company incentives to move our U.S. jobs out of the country. They are back now for the Kill, to finish the job on working Americans. No American company that is doing work outside of the U.S. should have Government contracts or paid incentives. - WrongIdea
The Tea Partiers seem to think they are some sort of populist movement, but in fact they are just dupes for bankers, Wall Street, the corporations and the Koch Brothers and other super-rich who run this country. Their stupidity is helping to kill the middle-class and create a huge gap between the very few super-rich and everyone else who is struggling to survive. - RootieKazootie
The problem isn't democrat or republican -- it's the system. Lobbyist representing corporate America -- aka multinational corporations -- run the show. Both political parties are responsible for deregulation and the housing mess. Both parties are responsible for allowing the outsourcing of jobs and importing foreign labor. Politicians care about getting reelected, not about you. We the sheeple have allowed our standard of living to be decimated. We continue to believe in a political system that obviously has no regard for its citizens. - Kathleen
We have 22 million people out of work, paying no taxes and scraping by on the dole. Meanwhile, both Parties are still giving TAX BREAKS to companies for outsourcing jobs. Both Parties refuse to force employers to use E-Verify to stop the employment of illegals. Both Parties still encourage American employers to use H1/Green Card workers. Both Parties have endorsed more NAFTA style trade agreements. Both Parties recently agreed to allow Mexican trucks and drivers to work in the U.S., knowing it will cause U.S. truckers to lose their jobs. While both Parties work to sell this country, they keep up us riled up with gay marriage, gun control, abortion. By the time they are finished outsourcing jobs and "in sourcing" cheap labor, both legal and illegal we will all be willing to work for beans and a place to sleep. - Greg789
Read up on the "Roaring 20's" and the Depression. The rich were never sorry then and they're not sorry now. Now that everyone who experienced the Depression is dead or dying, we're going to have to relearn those hard lessons. Maybe this time there will be no FDR to save capitalism. Rich idiots just don't see when they're in trouble. - Erik
It is largely due to a shift from a manufacturing economy to a service economy and movement of jobs offshore coupled with greed from corporate leaders to politicians - the establishment of a very elite club. - DRussman
This just shows the greediness that is called capitalism. Prices keep going up even though many businesses are outsourcing oversees and paying starvation wages while avoiding US taxes and hiding their money. The CEO's and upper management are making huge profits and the big investors on Wall Street are growing fat and rich by controlling the markets and moving them at will. The salaries of the top 1% in this country have risen 275% the last 35 years, yet they have had their taxes lowered and use huge loopholes to avoid paying their share. Democracy, morals, religion and concern for our brothers and sisters that built our country into a great nation are losing out to this greediness! The Bible says, "It is easier for a camel to go through the eye of a needle than for a rich man to go to Heaven." - Byline
Capitalism is a good thing when it's ambitions are restrained and it doesn't consume the society that empowers it. It begins rightly enough by filling a need but when unbridled it then starts creating needs and works to sustain ever more contrived needs to maintain an excessive expansion which includes greater political influence as well as the ever mounting profits. It should be reinvesting in the society and market it sells to so that the relationship is balanced and that market "an employed and well paid population" can sustain it as much as it can sustain that market. - Bob M
What I do not understand is why do we not have people protesting? We are about to become peasents! These 1% are the ones that line the pockets of our government officials to pass the necessary laws to allow this to happen! - Anonymous
The term global economy is just a bunch of garbage -- meaning corporations can send jobs overseas and find creative ways to avoid taxes. - graphicsguy
30 years of "trickle down" economic policies, and we see the result. The money stays at the top (with the richest of the rich), and the bills (payments) trickle down to the middle and lower classes. - Dorks
All these rich people should set up a pool and donate a portion back to the taxpayers and disabled; we are the people who made it for them. - Avery
.....perfectly illustrates why you need a progressive tax rate in a capitalist system......if we had a truly free market and everyone could compete on a level playing field, flat tax rate would be fine.....that's not what capitalism is.......extending the bush tax cuts was a disaster....... - JENSEN
Guess the trickle down economic plan isn't working. At GE they pay no taxes yet expect the young to die in wars to protect their multinational interests. Lovely arrangement. Jack Welsh - take a bow. It's easier for a camel to pass through an eye of a needle, then for a rich man to enter the kingdom of heaven. Enjoy your riches on earth - it's going to be bumpy ride south afterwards - a realist
The rich get richer, as it's been said over and over. Try playing the stock market these days. It becomes readily apparent that the wealthy manipulate it, at will, for their own gains. Once you are in it you will play a short game, get wiped out and then leave, licking your wounds. Guess who now has the few pennies you brought in??? It's like Vegas, except the deck is stacked against you to an even greater extent. Unless you can trade mega-blocks of stocks and make the market move the way you want, there is little chance that you are coming out a winner. - News Guy
The corporations downsize so they can stay in business and we can have jobs, or so they say when they lay off people and now one person is doing the job of three. It's all about greed, whether it's politicians or big business, even little business because they want to become big business. This so reminds me of an old scifi movie, can't remember the name of it, but the rich lived in a dome-covered lush, beautiful land, and the poor lived outside in whatever was available -- not much food, etc, radiation effects I believe. The poor suffered greatly while the rich stood by and laughed, behind their dome of course. That's about the way it is now. They own the businesses and we bow down, or else. The big business owns the government and politicians, so we bow down or else. No job, no unemployment, no SS, whatever, if we don't bow down. Sad. It will end eventually!!! - Lewe
Don't you all know that the people you "voted" for do not represent you? The elected are bought and paid for by "them." Even the "new" ones succumb to it after a term or two. We do not matter, and they are making sure of that. Just ask GE or Warren Buffet. - Pánico Extenso
If I read the comments, I don't think most of the commenters understand the graph. I would suggest you ask someone to explain it to you. Ever heard of Pareto analysis? I would guess if we compared any decade that an analysis would show approximately the same result. 20% of the people will have 80% of the wealth. That's not news, that's reality, except dictatorships like Libya -- 1 family controls 90%+ of the wealth. - AM
The central issue is not unions or outsourcing, it's tax policy. Starting in the '30s, under FDR, the tax rate on every dollar earned in income above roughly $5 million (inflation adjusted) per year was 91%. In the early '60s, Kennedy (a Democrat) voted to decrease this to 72%. In the 70s, Republicans Nixon and Ford both supported keeping the top marginal rate at 72%. In the 80s, Reagan dropped the top marginal rate to about 40%; Clinton kept it there, but Bush reduced it to 36%. - Aaron
If you haven't figured out that the wealthy, corporations, and their political employees -- paid for by political campaigns -- are ensuring that American wages don't increase, then you aren't paying attention. In fact, with the destruction of unions, government furlough days, and removal of medical plan as compensation, the middle class is becoming poorer everyday. The extreme poor have been written off as non-existent. Wake up America, you are becoming slave labor. - OldPatriot
Of the things that the government has to do for the people, regulating financial institutions is one of them. When the Great-Depression-era law regulating banks, insurance companies and financial institutions' ability to game the system was overturned by Republican Congress and signed by Bill Clinton, the middle class was shot down. I neither want the European socialism that Obama and the liberals want nor the unfettered capitalism that many Republicans want. I want capitalism with restraints and social conscience. - AnnO
The truth is Taxes --ALL TAXES --- are paid by the people. Corporations NEVER HAVE AND NEVER WILL PAY TAX. They simply pass these cost on to you and I by increasing the cost of goods and services. Corporations are loved by Government. They can talk about corporations paying their fair share -- while what they are really doing is raising taxes and reducing the standard of living for the common man . Our politicians are absolutely sure we the people will never figure out that corporations, the way they are currently structured, are just cash collecting machines for Government.. As such, Adolph Hitler loved Corporations; in fact, fascism was originally known as Corporatism. - Boyd H
Those of you that believe that some socialist or communist is going to redistribute to you...are suckers. - flipacoin
The Top 1% pays 39% of state and federal income taxes. The Bottom 47% (Obama's base) pay no income taxes at all. - Muhammed Nidal
Liberalism is a mental disorder. Any thought process which rewards non performance and penalizes performance is insanity by any other word! Here's the one-question litmus test to determine if you afflicted by the mental disorder: Do you value entitlement more than personal responsibility? - El Gato
Um, well, the after-tax income of the rich went up by 281%.....but, the pre-tax income only went up 19%. Since the bottom 50% pay NO tax, their after and pre tax is about the same, and their income went up 16% to 25% percent, more than the top 1%. Nice try, socialists. - Brooke