The Real Causes of Income Inequality

[Conservative]

great read. very enlightening.

This is just a sample... go read the piece.
Gramm and McMillin: The Real Causes of Income Inequality - WSJ.com
Any analysis of taxes paid in high tax-and-spend countries shows that the U.S. has the most progressive income tax system in the world.

In the stagnant days of the Carter administration, when inflation was approaching 13.5% and interest rates were peaking at 21.5%, income was more evenly distributed than in any period in 20th-century America. Since the days of that equality in misery, the measured income of the top 1% of income tax filers has risen over three and a half times as fast as the income of the population as a whole.

This growth in income inequality is largely the result of three dynamics:

1) Changes in the way Americans pay taxes and manage their investments, which were a direct result of reductions in marginal tax rates.

2) A dynamic shift in the labor-capital ratio, resulting from the adoption of market-based economies around the world.

3) The flourishing of economic freedom and technological advances in the Reagan era, which were the product of lower tax rates, a reduced regulatory burden, and an improved business climate. These changes have not only raised the measured income of the top 1%, they benefited the nation and the world.

An inconvenient truth for the advocates of higher taxes on America's rich is that big governments in developed countries are funded not by taxing the rich more than the U.S. does, but by taxing everybody else more.

In an eternal irony unique to large welfare states, it is the expansion of government in the name of the poor and middle class that always costs poor and middle-class families the most. When the U.S. collects 16.1% of GDP in income taxes, the top 10% of taxpayers pay 7.3% and the other 90% pick up 8.9%.

In France, however, they collect 24.3% of GDP in income taxes with the top 10% paying 6.8% and the rest paying a whopping 17.5% of GDP. Sweden collects its 28.5% of GDP through income taxes by tapping the top 10% for 7.6%, but the other 90% get hit for a back-breaking 20.9% of GDP.

If the U.S. spent and taxed like France and Sweden, it would hardly affect the top 10%, who would pay about what they pay now, but the bottom 90% would see their taxes double.

 

[Dragon]

Many of these statistics are misleading. For example, "When the U.S. collects 16.1% of GDP in income taxes, the top 10% of taxpayers pay 7.3% and the other 90% pick up 8.9%. In France, however, they collect 24.3% of GDP in income taxes with the top 10% paying 6.8% and the rest paying a whopping 17.5% of GDP."

But this does not address the fact that in the U.S., the top 10% of taxpayers draw in a much larger share of the national income than they do in France. It follows inevitably, barring a HUGELY more regressive tax system, that they're going to pay a larger percentage of the total.

The correct statistic to use is what percentage of people's income is paid in taxes, not what percentage of total taxes people of a given income bracket pay. The latter is almost completely meaningless.

The same statistic is misleading in another way, in that it seems to include only federal income taxes (in the U.S.) and French income tax, leaving out both U.S. payroll taxes and French VAT. These need to be factored in for a complete picture.

 

[SniperFire]

.

The correct statistic to use is what percentage of people's income is paid in taxes, not what percentage of total taxes people of a given income bracket pay.

That is certainly how a communist looks at it.


There is nothing 'correct' about your statement.

 

[Katzndogz]

The real cause of income inequality is that people who lay on their ass taking dope and playing video games want to have an equal income to those who get out and hustle.

 

[Dragon]

The real cause of income inequality is that people who lay on their ass taking dope and playing video games want to have an equal income to those who get out and hustle.

Right, obviously. Income inequality has increased so much since the 1960s because more video games have been put on the market. Why didn't I think of that?

 

[TorJohnson]

Phil Gramm?

The SAME Phil Gramm that wrote BOTH the Commodities and Futures Moderization Act AND the Gramm-Leach-Bliley Act?
Commodity Futures Modernization Act of 2000 - Wikipedia, the free encyclopedia
http://en.wikipedia.org/wiki/Gramm–Leach–Bliley_Act
Why don't you read what Phil Gramm legislated before you go and tout him as someone worth listening to?

The same Phil Gramm that DEREGULATED derivatives on Wall Street?
The same Phil Gramm who turned back Glass-Steagal?
The same Phil Gramm who now works as a lobbyist for swiss banks?
The same Phil Gramm that legalized ENRON's trading shenanigans?

Yeah....let's listen to the guy who is most directly responsible for wrecking our economy.
Let's listen to the guy who rewrote the rules to let guys like ENRON flourish.
FACT: Without Phil Gramm, the great crash of 2007 would not have occurred.


No wonder republicans are seen as such losers. They take advice from people who have completely SCREWED not only themselves but the country.

My god. Educate yourself before you go spouting these right wing talking points. You make the rest of us conservatives with a memory and a brain look bad.

Do conservatism a favor and don't try to help it. It doesn't need your kind of ignorance.

 

[TorJohnson]

The real cause of income inequality is that people who lay on their ass taking dope and playing video games want to have an equal income to those who get out and hustle.

Got any PROOF of that statement?

No?
Then why bother with it?

Educate yourself about what we spend and who gets it.
How much do we REALLY spend on Welfare?

 

[M14 Shooter]

Those who lin in and contribute to a free society will almost always have more, and better, stuff than those that do not.
Liberals seek to fix this problem.

 

[inALIENable]

The real cause of income inequality is that people who lay on their ass taking dope and playing video games want to have an equal income to those who get out and hustle.

Got any PROOF of that statement?

I bet we all know someone like that. Want us to gathers them all up and send them over to your place? You can keep them since they are apparently invisible to you.

 

[Katzndogz]

The real cause of income inequality is that people who lay on their ass taking dope and playing video games want to have an equal income to those who get out and hustle.

Got any PROOF of that statement?

I bet we all know someone like that. Want us to gathers them all up and send them over to your place? You can keep them since they are apparently invisible to you.

They weren't quite so invisible when the OWS shitters were crapping up the streets.

 

[UpAndAbout]

The real cause of income inequality is that people who lay on their ass taking dope and playing video games want to have an equal income to those who get out and hustle.

The ones who do not graduate high school want to be paid the same for forming hamburger into patties or sorting shorts in a laundry as somebody with a master's degree in engineering.

 

[francoHFW]

The real cause of income inequality is that people who lay on their ass taking dope and playing video games want to have an equal income to those who get out and hustle.

The ones who do not graduate high school want to be paid the same for forming hamburger into patties or sorting shorts in a laundry as somebody with a master's degree in engineering.

Pure Pub psychobabble- you're a tool of greedy, stupid mega rich a-holes...see sig pp1...

 

[midcan5]

What a biased bunch of BS that article is - if most middle and lower class wage earners salaries have remained flat for say forty years, and the top few percent have increased greatly, it sure ain't taxes that are the cause. Consider executive pay and then consider wage earner pay, look at Walmart as an example. The reasons for wage inequality require no wild ass assumptions, they stare you in the face. Lack of unions and outsourcing are sources, but so are old fashioned concepts like greed and self interest. What CEO should make millions while those who create the product, both at the engineer and production worker level get little or nothing and are threatened with the door for noticing the wide gap. Someone oddly immoral is wrong when nonsense like the OP is accepted and published as if some kernel of truth were contained in it.

"Average household income before taxes grew in real terms by nearly one-third between 1979 and 1997, but that growth was shared unevenly across the income distribution. The average income for households in the top fifth of the distribution rose by more than half. In contrast, average income for the middle quintile climbed 10 percent and that for the lowest fifth dropped slightly. Furthermore, income growth at the very top of the distribution was greater yet: average income in 1997 dollars for the top 1 percent of households more than doubled, rising from $420,000 in 1979 to more than $1 million in 1997." [Congressional Budget Office, Chapter One] Income Inequality: A Problem?

15 Shocking Facts Show That the Middle Class is Being Wiped Out | Economy | AlterNet



"As Jason DeParle reported recently in The Times, new research indicates that if you start off near the bottom of the income ladder in the United States, you’re far more likely to remain there than if you’re in the same situation in Canada or Europe. And if you start off poor in Denmark or Britain, for example, you’re much more likely to reach the top fifth in income than if you try to make the same climb in the United States. It seems that the Danish Dream and the British Dream are currently more alive — at least for the most disadvantaged — than the American Dream." In the Fight Against Poverty, Time for a Revolution - NYTimes.com



The irony of the Cold War's capitalism vs. communism paradigm is that capitalism in the US and other western countries required generous helpings of socialism to make it work. Conservative politicians like Eisenhower and Nixon seemed to understand this and generally supported the social programs listed above." Which Side Are You On? New Language for a New Political Reality | Common Dreams


How the rich benefit from what should be owned by all: The Conservative Nanny State and Introducing the Great Divergence - Slate Magazine

How did you get rich daddy? The rich get rich because of their merit. and UBI and the Flat Tax

 

[Remodeling Maidiac]

Except for the mentally or physically impaired we all have an equal chance at wealth. With a few minor exceptions of course.

 

[Dragon]

Except for the mentally or physically impaired we all have an equal chance at wealth. With a few minor exceptions of course.

Someone with twice Bill Gates' ability, but lacking Gates' rich lawyer daddy, could never have founded Microsoft.

 

[kaz]

Many of these statistics are misleading

The reason some people have more money is far more simple then that, isn't it Red China? I mean Dragon. Some people are more intelligent, have more sense, work harder and invest in themselves (education, training, experience). It really is that simple, you can spin stats all day long.

 

[8537]

The US collects 16.1% of GDP in income taxes?

Income tax receipts in 2011: 1.3 Trillion
GDP in 2010: 15094

Income taxes as a percent of GDP: 8.6%

 

[Dragon]

Many of these statistics are misleading

The reason some people have more money is far more simple then that, isn't it Red China? I mean Dragon. Some people are more intelligent, have more sense, work harder and invest in themselves (education, training, experience). It really is that simple, you can spin stats all day long.

Well, that depends on whether you are asking why some people have more money than others -- a simple yes/no on/off either/or binary -- or are, instead, asking why some people have SO MUCH more money than others.

Income inequality in this country doesn't just exist. It's grown vastly greater over the past 30 years or so. Differences in peoples abilities, on the other hand, have not increased over the same period. So no, some other explanation, something that's actually CHANGED and so could be causing this changed circumstance, must be the reason.

 

[kaz]

Income inequality in this country doesn't just exist. It's grown vastly greater over the past 30 years or so. Differences in peoples abilities, on the other hand, have not increased over the same period. So no, some other explanation, something that's actually CHANGED and so could be causing this changed circumstance, must be the reason.

Anyone can do anything in this country if they do it with their own resources. In the United States, only a loser fails, blames it on someone else and asks for the government to fix it.

 

[Dragon]

Anyone can do anything in this country if they do it with their own resources.

Really? Well, then, let's see you flap your arms (using your own resources) and fly like a birdie.

Or let's see you bench press (using your own resources) a ton of weight.

Or let's see you build a skyscraper, using your own resources, in your backyard.

Or let's see you, using your own resources, buy up all the stock of Microsoft Corporation.

You can proclaim fatuous platitudes, or you can deal with reality. I know which one I prefer. It seems you prefer the other.