US income inequality continues to grow

[Beaker]

(07-24-2018, 05:55 PM)fredtoast Wrote: An individual can not change a tax law.

An individual can not change an interest rate.

An individual can not impose trade tariffs.

An individual can not stop a company from moving overseas.

An individual can not regulate lending practices.

An individual can not create a job market.

An individual can not give a corporation bankruptcy protection.





So, yes, I am completely ignorant of how an individual can change the economy.  Please give me the details.

A single individual does not change the system, but individuals make up the economy. So you can begin to change the system one individual at a time. as more fortunes change, the economy changes with them.

[Beaker]

(07-24-2018, 06:13 PM)fredtoast Wrote: Wages should rise based on inflation, worker productivity, and profits.  When inflation, worker productivity, and profits are rising while labor wages remain the same or even drop then the employer is exploiting the workers.

Do you agree or disagree?

I can't give you a dollar amount because every job is different.

And every individual makes different choices of what to do with their income. So what is a comfortable living wage for one person might be considered a non-livable wage by another who is not making wise choices. Does that mean the company is exploiting labor?

[Beaker]

(07-24-2018, 07:03 PM)fredtoast Wrote: Who hates Capitalism?

(07-24-2018, 07:38 PM)fredtoast Wrote: Capitalists are not necessarily evil, but capitalism is. 

[*Nately120*]

(07-24-2018, 08:04 PM)Beaker Wrote: A single individual does not change the system, but individuals make up the economy. So you can begin to change the system one individual at a time. as more fortunes change, the economy changes with them.

Yes, but again this is a pipe dream.  Case in point, instead of everyone agreeing to just NOT hire illegal immigrants, we elected a guy who has hired illegals due to the fact that he promised to build a giant free wall along our border.  Then again, I'm a big ol' cynic.

[*bfine32*]

(07-24-2018, 08:12 PM)Beaker Wrote:

Well maybe Fred doesn't hate evil. 

[Beaker]

(07-24-2018, 08:13 PM)Nately120 Wrote: Yes, but again this is a pipe dream.  Case in point, instead of everyone agreeing to just NOT hire illegal immigrants, we elected a guy who has hired illegals due to the fact that he promised to build a giant free wall along our border.  Then again, I'm a big ol' cynic.

I dont disagree that the system is ponderous and slow to change. But you have to start somewhere. What better place than working to better your own situation? Obstacles are there to be overcome.

[Benton]

(07-24-2018, 08:28 PM)Beaker Wrote: I dont disagree that the system is ponderous and slow to change. But you have to start somewhere. What better place than working to better your own situation? Obstacles are there to be overcome.

I’d argue it’s largely irrelevant as people have changed and the companies with influence over the economy reacted.

Wages were high, job growth was good for decades. Businesses didn’t like the high taxes, so they used their influence to reduce their tax burden and shift it to workers. Then you had a recession and consumers started spending less, so businesses have responded by reducing their tax liability more at state and federal levels.

[BmorePat87]

(07-24-2018, 07:27 PM)bfine32 Wrote: It's actually a bastardization of government to allow themselves to be manipulated so. 

The problem is not with the capitalists; it's with the government and some folk's answer is let's get the government more involved.

It's all interrelated. We don't have pure capitalism and we won't ever have it. Criticism of capitalism in this nation is mostly criticism of the version of capitalism that we have in this nation. The problem absolutely falls on both the businesses and the government. 

[GMDino]

(07-24-2018, 07:50 PM)Belsnickel Wrote: This is where the real bastardization of capitalism has occurred. Once upon a time, corporations were concerned about all of their stakeholders. This meant the customers, employees, management, and any others that came in contact with the corporation. There was a shift that came where corporations became only focused on their stockholders. This is where the shift to "profit above all" came into play.

Capitalism itself isn't evil, either. People have corrupted it and caused the need for regulation. Capitalism, socialism, neither is a great solution. A mixed economy is always going to be best. Much like most things in life, black and white never provides a good answer. It's all about the grey.

I mean before regulations capitalism ran fine in the late 1800's and early 1900's.

Workers were well taken care of with pay and working conditions...right?

[*PhilHos*]

(07-24-2018, 08:54 PM)Benton Wrote: I’d argue it’s largely irrelevant as people have changed and the companies with influence over the economy reacted.

Wages were high, job growth was good for decades. Businesses didn’t like the high taxes, so they used their influence to reduce their tax burden and shift it to workers. Then you had a recession and consumers started spending less, so businesses have responded by reducing their tax liability more at state and federal levels.

So you agree that taxes are the problem. 

[Benton]

(07-25-2018, 02:49 PM)PhilHos Wrote: So you agree that taxes are the problem. 

For big companies, undoubtedly. 

Larger corporations used to pay about a a third of federal taxes. Now they pay about a 10th, and that's getting smaller every "tax reform." Which I would be all for... if we were shrinking federal spending. But you can't keep cutting taxes and increasing spending. It's insane.

All we do with "tax reform" is shift more of the tax burden to lower classes and off of companies and top earners. That's not really reform, and it's not addressing our tax issues. All it's doing is making for a crappy economy.

[GMDino]

(07-25-2018, 03:14 PM)Benton Wrote: For big companies, undoubtedly. 

Larger corporations used to pay about a a third of federal taxes. Now they pay about a 10th, and that's getting smaller every "tax reform." Which I would be all for... if we were shrinking federal spending. But you can't keep cutting taxes and increasing spending. It's insane.

All we do with "tax reform" is shift more of the tax burden to lower classes and off of companies and top earners. That's not really reform, and it's not addressing our tax issues. All it's doing is making for a crappy economy.

[*michaelsean*]

(07-25-2018, 03:14 PM)Benton Wrote: For big companies, undoubtedly. 

Larger corporations used to pay about a a third of federal taxes. Now they pay about a 10th, and that's getting smaller every "tax reform." Which I would be all for... if we were shrinking federal spending. But you can't keep cutting taxes and increasing spending. It's insane.

All we do with "tax reform" is shift more of the tax burden to lower classes and off of companies and top earners. That's not really reform, and it's not addressing our tax issues. All it's doing is making for a crappy economy.

We aren't shifting the burden to lower classes.  They don't pay anymore then before.  

[Belsnickel]

(07-25-2018, 03:24 PM)michaelsean Wrote: We aren't shifting the burden to lower classes.  They don't pay anymore then before.  

When you compare the reduction in tax rate the wealthy have seen over the past 55 years in comparison to the lower income brackets, you can see that the wealthy got much more of a break than the lower brackets, resulting in a shifting of the burden.

Granted, this all happened a few decades ago, but we're still dealing with some of the lowest tax rates since the individual income tax began in this country.

[Benton]

(07-25-2018, 03:24 PM)michaelsean Wrote: We aren't shifting the burden to lower classes.  They don't pay anymore then before.  

Sure they do.

Take Kentucky. Our GOP-led lawmakers are super proud of their tax reform which essentially lowered income tax for the highest bracket, where most middle class and above earners fall (myself included, so, yay!). It went from a high of 6% down to 5%. Lower income earners went up to 5%, instead of the graduated 2-5%.

But the state knew it wasn't going to make a ton of money by increasing lower income tax brackets, you need more taxes. So, they started taxing goods and services. Which hits high income and low alike... except that businesses and higher earners can write some of that off as an expense. 

And that's just on consumption and income taxes. That's not even touching the disparity in wages versus long-term investment returns or other forms of income.

[*michaelsean*]

(07-25-2018, 03:36 PM)Belsnickel Wrote: When you compare the reduction in tax rate the wealthy have seen over the past 55 years in comparison to the lower income brackets, you can see that the wealthy got much more of a break than the lower brackets, resulting in a shifting of the burden.

Granted, this all happened a few decades ago, but we're still dealing with some of the lowest tax rates since the individual income tax began in this country.

Well let me ask this because I don't know how to look it up.  What percentage of income tax did the wealthy pay in 1960 compared to today.  That's an easier way for me to think about it.  

[Benton]

(07-25-2018, 03:45 PM)michaelsean Wrote: Well let me ask this because I don't know how to look it up.  What percentage of income tax did the wealthy pay in 1960 compared to today.  That's an easier way for me to think about it.  

https://taxfoundation.org/us-federal-individual-income-tax-rates-history-1913-2013-nominal-and-inflation-adjusted-brackets/

Top earners (anything over $200,00) through most of the 50s-early 60s paid 91%.

70% through the 70s.

Down to 50% in 80s.

Since then, it's kind of jumped all over the place, but those generally those families making less than $100,000 have paid less than 30%, and those making more than $250,000 have been paying around $35% (ish). 

[*michaelsean*]

(07-25-2018, 03:58 PM)Benton Wrote: https://taxfoundation.org/us-federal-individual-income-tax-rates-history-1913-2013-nominal-and-inflation-adjusted-brackets/

Top earners (anything over $200,00) through most of the 50s-early 60s paid 91%.

70% through the 70s.

Down to 50% in 80s.

Since then, it's kind of jumped all over the place, but those generally those families making less than $100,000 have paid less than 30%, and those making more than $250,000 have been paying around $35% (ish). 

Those are the tax rates.  I'm asking about percentage of taxes paid as that would indicate burden.  This one only goes back to 1979, but from there the tax burden has decreased on the lower earners and increased on the higher earners.  

https://www.taxpolicycenter.org/statistics/shares-federal-tax-liabilities-all-households

Edit: This doesn't account for rate of increase income, but the lower ends are not carrying a higher burden of the taxes. I think the bottom 40% or something like that actually pay an effective rate of zero.

[Benton]

(07-25-2018, 04:03 PM)michaelsean Wrote: Those are the tax rates.  I'm asking about percentage of taxes paid as that would indicate burden.  

Ah, gotcha.   

I misread and thought you were asking about income tax rates.

Quote:This one only goes back to 1979, but from there the tax burden has decreased on the lower earners and increased on the higher earners.  


https://www.taxpolicycenter.org/statistics/shares-federal-tax-liabilities-all-households

Edit:  This doesn't account for rate of increase income, but the lower ends are not carrying a higher burden of the taxes.  I think the bottom 40% or something like that actually pay an effective rate of zero.

Eh, I'm not sure where that's coming from. I  remember reading something about the newer brackets effective rates would be somewhere around half of the face value (if your rate is 25%, your rate would be 13% ish when you factor in deductions and such). But the same would hold true for top earners dropping from 37% to 18% ish. 

Either way, I think a comparison of the 91% versus effective of the 37% would be pretty interesting. I did come across this with a quick google.

http://www.nbcnews.com/id/29861648/ns/politics-capitol_hill/t/how-tax-burden-has-changed/#.W1jOyIczI5Q

Quote:The Congressional Budget Office study found that a person in the middle of the income distribution (the middle fifth, if you divide the population by fifths according to income) paid an effective federal tax rate of 14.2 percent in 2005, while a person in the one percent of the population with the highest income had a effective tax rate of 31.2 percent. 

People in the lowest fifth, or quintile, had an effective tax rate of 4.3 percent, partly because tax law changes in the past ten years removed many low-income people from the income tax rolls entirely. They pay only payroll taxes. 
The lessening of the tax burden on the lowest quintile is a big change from 1979. That year, according to CBO, people in lowest income group (the bottom fifth of the income distribution) paid an effective federal tax rate of 8 percent.

[Belsnickel]

(07-25-2018, 03:45 PM)michaelsean Wrote: Well let me ask this because I don't know how to look it up.  What percentage of income tax did the wealthy pay in 1960 compared to today.  That's an easier way for me to think about it.  

I started doing my whole lengthy post thing, then scrapped it. I'm not sure of the figures, but it would've definitely been a higher percentage given the top tax rate at 91%, though you'd have to make around $3,148,000 in 2013 dollars to reach that mark. Also, at the time capital gains were taxed at a higher rate than they are, today.