<p>You and me both.</p>
<p>I find it interesting that the people who are essentially arguing in favor of continuing to redistribute wealth from the middle class to the wealthy feel that they need to misrepresent my opinions in order to have something to argue against. (Talk about “facts be damned”!)</p>
<p>Once again: it’s not a question of “hating the rich”, it’s a matter of recognizing that government policies - affirmative actions taken by our government - have tended to shut the middle class and poor out of sharing in the growth of our economy, while providing “can’t lose” economic opportunities for the wealthy. </p>
<p>The biggest of the factors noted is probably “deregulation.” This panacea was supposed to make everything cheaper and better in every industry. Instead, it led to violent market disruptions, bankruptcies and looted pension plans, with a few hustlers making big bucks and the government left to pay out billions to bail out industry after industry. Savings and loans, airlines, energy, sub-prime lenders (up and downstream) etc. A few got rich, lots got screwed, and the taxpayer got handed a big bill. </p>
<p>McCain wants more of it. One thing deregulation does do, it provides opportunities for the very wealthy to increase the gap, since the risk of business failure is socialized but the profits from success are private. So if you’ve got enough skin in the game you can roll the dice over and over. The losses of the wealthy are capped, but the profits aren’t. The middle class doesn’t get that option; if you declare bankruptcy you still have to enter into a contract to pay back in installments. Charles Hurwitrz laughs at chumps like that. But then - he’s rich, and you’re not. ;)</p>
<p>Where is the “redistribution” when new rich are being created by founding new successful companies? The idea that for some to get rich means taking it away from the rest is old Marxist zero sum BS.</p>
<p>Again who are these terrible reverse robinhoods–name some names. I can list 1000’s that got rich in purely legit ways.</p>
<p>There are two ways to reduce the tax burden. One is obviously to shift the tax burden. the other is simply to reduce expenditure so that less tax revenue will be needed. As I said, the poor really don’t need a large standing military, law enforcement and school as one poster here so inelegantly put it that they don’t finish school anway. Therefore for the poor, one way to reduce tax burden is simply do away what they don’t need. But that is too rational. let us go back to be sarcastic.</p>
<p>BTW, I am very serious about not getting rid of USDA meat inspection. The idea that everyone except the vegetarian running to find bathrooms is pretty revolting.</p>
<p>I love how Kluge turned this into a blame Republican tirade.</p>
<p>
</code></pre>
<p>I would tend to think it’s due to the massive credit bubble and the rise of Finance in our economy.</p>
<p>
Why do the poor not need law enforcement? I get that there is sarcasm going on, but am having trouble piecing together what kluge said with what you are saying. </p>
<p>Kluge wants corporations taxed heavily. Okay, I get that. But what does that have to do with who gets what services?</p>
<p>Is this perhaps a continuation of another thread (or many other threads)? If so, that might explain why I’m lost.</p>
<p>pmrlcomm, perhaps we should stick with threads where we know what the heck is going on.</p>
<p>I have been pondering tax advantaged products for the past year. And very nearly coming to the conclusion that under the current tax programs, that 529’s, 401ks, and Roth/trad IRAs, SEP IRAs and Annuities, are a way to milk the middle class for more taxes. I think we have been hoodwinked by everyone.</p>
<p>I am so proud of my S because he made an appointment to see his broker who used to be broker for the UGMA. We just finished his 2007 taxes (he’s been out of country) that he pretty much did by himself with my help and the tax accountants help, and today I said to him, your brokerage account, you have stock that have gains and some with losses. See what happens to your taxes if you sold the stock with gains and then again the stock with losses. Look at the relationships between the two sells.</p>
<p>I think what is going on is that it really doesn’t matter what you say or what you bring to the table. They are out for blood. They are ignorant to how things really work and they don’t want to know. They want things to go their way and their way only. It’s like arguing religion with a zealot. No matter what you say they will never hear it.</p>
<p>Nice rant, pmlrcomm, except that you failed to articulate who or what it is that you’re talking about. Zombies? You make a great case for how “you” are superior to “they” but beyond that general expression of personal virtue, it’s all just a bunch on enraged frothing.</p>
<p>Okay - deregulation, which I identified as one factor - no comments. I guess it just doesn’t fit the soundbites you guys have preprogrammed into your computers for attacking anyone who dares mention the lack of garments on the Emperor so you fall silent, or make up other opinions to project onto your target and attack that, eh?</p>
<p>Mr. Payne - what tirade? And who said only Republicans are to blame? Sure republican politicians like McCain are solidly on board with the movement to comfort the rich and afflict the poor, but they’re not alone. If you want to pick a discrete group which is unabashedly at the forefront of pushing this trend, try the Chicago School’s impact on economics, law and business. </p>
<p>Prediction: last statement fails to fit mold sockpuppet economic soundbites designed to attack anyone questioning the status quo. Alert! Alert! Change subject! Attack poster! Ignore substance! Alert! Alert!</p>
<p>Since you’ve looked at the Gini chart on Wikipedia, did you notice that America is closing in on having the same level of income disparity as – Mexico? I guess that’s one way to solve that pesky issue of immigration, eh? </p>
<p>Increase corporate taxes? Who said that? Not me. But how about linking compensation of corporate insiders to company performance on the downside as well as the upside? Instead of letting guys like Charles Hurwitz walk away from the steaming hulks of corporations he has looted, leaving taxpayers and shareholders holding the bag, some personal responsibility for the consequences of actions taken by the people who run incorporated businesses?</p>
<p>*Prediction: Post fails to fit mold which sockpuppet economic soundbites are designed to attack. Alert! Alert! Change subject! Attack poster! Alert! Alert! *</p>
<p>I was speaking in the general sense. There are several things I have read on this and similar threads that have prompted me to reread or reevaluate thoughts on specific matters. There is nothing superior about it. I don’t just disregard the other sides data as faulty or propaganda. I try best as my little brain can to understand it. I just don’t think everyone has an open mind.</p>
<p>I found this. It is on topic - </p>
<p>[FactCheck.org:</a> What percent of taxes does the top 1 percent pay and what percent of the income do they make?](<a href=“http://www.factcheck.org/askfactcheck/what_percent_of_taxes_does_the_top.html]FactCheck.org:”>http://www.factcheck.org/askfactcheck/what_percent_of_taxes_does_the_top.html)</p>
<p>The type of data kluge quoted is often used to show that the rich get richer, the poor get poorer. But that is not the correct interpretation. This kind of interpretation assumes that there is no income nobility. So if people in the top 1% are forever in the top 1%, and they are richer; people in the bottom 25% are forever in the bottom 25% and they are poorer. Of course such an interpretation defies common sense, and force the conclusion of rich become richer and poor become poorer.</p>
<p>To really know what is actually going on, we need to trace people’s income over a period of time. The US Treasury did such a study. They took a sample of tax returns in 1996 and look at the incomes, and then they look again for the same people’s tax return in 2005. They found that most people’s income increase… The lower the income, the higher percentage the income increase is. The bottom 20% has the highest increase of 90%. Only the top 5% has a drop in income, and the top 1% has the biggest drop.</p>
<p>So contrary to what everyone claims, the poor is getting richer and the rich (i.e. Top 5%) gets poorer. This is hardly surprising. The top earners are probably at their peak earning portion of their career, and probably at the 40s and 50s, they cannot keep up forever and they are often close to their retirement age. The bottom earners are often those just entering the job marker or are new illegal immigrant. As time goes on they are more experienced (or starts to know English), and their incomes increase.</p>
<p>How do we reconcile with kluge’s data? What it really means is that the new rich is richer than the old rich, the new poor is poorer than the old poor. Other people discuss this already, the technology revolution enables sudden creation of wealth, and bigger demand for high skill knowledge worker. On the other side, low skill worker cannot compete with third world wage aboard and illegal immigrant wage here.</p>
<p>We also have a boom of people moving through their peak earning years. As they retire the bulge at the top will move downward on the income scale. I think Kluge’s argument about wealth unfairness is in tatters. Sometimes you have to look a little past the simple data.</p>
<p>Actually, bomgeedad, the Treasury report did not support your conclusions. It is true that most people’s income rises with age - that is Joe Sixpack will make more money at 50 than he will at 25, same as his dad and grandfather probably did. That’s not income mobility, that’s just normal economc maturation within a single lifespan. For income mobility you need to see Joe Sixpack Jr. making more money (adjusted for inflation) at 25 than his Dad did - and also, Richie Rich Jr. making less when he’s 50 than his Dad did. And that’s happening less and less each year along with the growth in income disparity. Increasingly. the “new rich” are the children of the “old rich” and the “new poor” are the children of the “old poor”. Movement out of economic strata continues, but the chances of such movement - up or down, are decreasing, not increasing.</p>
<p>Shhh! There isn’t supposed to be any logic or reasoning on this board! I digress. I’ll try to be less inflammatory, provided others listen a little more.</p>
<p>To be fair, bomgeedad did not discuss income mobility but rather income “nobility”, which fits quite well with letting the poor be damned.</p>
<p>For the 1st(bottom) quintile, income increases by 90%,
for the 2nd quintile, income increases by 35%,
for the 3rd quintile, income increases by 25%,
for the 4th quintile, income increases by 15%,
for the 5th quintile, income increases by 10%,
for the top 5%, income drops by 5%,
for the top 1%, income drops by 25%.</p>
<p>You can use whatever cynical attack word you like, this is income mobility.</p>
<p>Would you provide a link so that the uninformed could be enlightened? Thanks.</p>
<p>Madville, the study is here: <a href=“http://www.treas.gov/offices/tax-policy/library/incomemobilitystudy03-08revise.pdf[/url]”>http://www.treas.gov/offices/tax-policy/library/incomemobilitystudy03-08revise.pdf</a></p>
<p>The problem with the study is that it compares the income of individuals who were taxpayers in 1996 with those same people’s returns ten year’s later. The result is *surprise! *the income of the average person studied went up! [/sarcasm]</p>
<p>Bomgeedad, when I was 25 I was in the bottom quintile. Ten years later I was in the fourth quintile. I’m now in the top quintile. I’m sorry but that’s not evidence of my economic mobility (I’m in the same socio-economic strata my parents were in.) It just means that fresh out of law school I made less than a lawyer with 10 and then 30+ years of experience. I’m not unusual in that. I’d expect that most people who post in the CC parent’s cafe have similar stories to report. Each of my three children is a taxpayer in the bottom quintile, and I’m pretty confident that each of them will move to higher quintiles over ten year periods of their life before ending up where they, realistically, started - in the top quintile. The problem with the Treasury study is that it didn’t analyze income mobility in a meaningful way, it just analyzed trends in individual’s income over a ten year period. That doesn’t tell you anything about your Horation Alger hero’s chances of getting rich through pluck and hard work; it just notes that people tend to earn more as they get older. (All together now: duh.) And people with highly variable income - lottery winners, entertainers, people who sell the family business in a given year - are going to flit in an out of the top 5% and 1% range not because of any significant change in their fortunes, but simply due to the fact that their presence in that higher bracket was due to a non-recurring income stream. Furthermore, since income at the 99th percentile level has been rising so fast, anyone who started out with an income in the lower part of the top 1% whose income didn’t increase at a meteoric rate during that ten year period drops down to the top 5% or top 10% level even though their income may have risen faster than that of the nation as a whole. That also doesn’t indicate income mobility. </p>
<p>So, no, I’m not using “cynical attack words”, and no, that’s not “income mobility.” I’m looking at the source data and recognizing its limitations. The people who sold this study as proof of “income mobility” are the cynics. Sometimes you just have to look at the data itself, and not fall for the facile spin put on it by the authors of a slick looking study.</p>
<p>My bookmark to the Treasury Dept is broken, I do a search and find this link to a non-government site.</p>
<p>[US</a> Treasury: incomemobilitystudyfinal](<a href=“http://www.scribd.com/doc/1256422/US-Treasury-incomemobilitystudyfinal]US”>http://www.scribd.com/doc/1256422/US-Treasury-incomemobilitystudyfinal)</p>
<p>Some more data, for people in 1st quintile, 10 years later
42% stays in the 1st quintile
29% move up 1 quintile to the 2nd
14% move to the 3rd
10% move to the 4th
5% move to the 5th
0.2% lucky one moves to the top 1%</p>
<p>A similar study was made 10 years earlier, and the mobility is similar.</p>