There is so much 'not in my back yard' mentality flying around. We've had a $10B a month spending spree thanks to the wars in the ME; $2.4T for
the War on Terror by 2017; the bail-out package whose real number is elusive, but for the sake of discussion let's say $1.5T; $25B to the
automakers... you get the idea. We're spending a phenomenal amount of money above and beyond the 'normal' day-to-day business of the country.
Unprecedented is a good word.
So who is going to pay for all this?
Two-thirds of U.S. corporations paid no federal income taxes between 1998 and 2005, according to a new report from Congress. Collectively, the
companies reported trillions of dollars in sales, according to GAO's estimate.
More than 38,000 foreign corporations had no tax liability in 2005 and 1.2 million U.S. companies paid no income tax, the GAO said. Combined, the
companies had $2.5 trillion in sales. About 25 percent of the U.S. corporations not paying corporate taxes were considered large corporations, meaning
they had at least $250 million in assets or $50 million in receipts.
Apparently not businesses.
The 'transfer of wealth' argument is convenient to say the least. There has been an ongoing and accelerating transfer of wealth from the lower
economic cohorts to the highest for many years:
The gaps in wealth between the rich and the poor and between whites and minorities have grown wider, the Federal Reserve said Wednesday in a
closely watched report that also showed a broad increase in stock ownership in the USA.
The difference in median net wealth between the 10% of families with the highest incomes and the 20% of families with the lowest incomes jumped 70%
from 1998 through 2001, the Fed said in its consumer finances report, which it conducts every three years. The gap between whites and minorities grew
21%.
The wealth gaps between races and income levels had shrunk slightly from 1992 to 1995 but had also risen by double digits in the 1998 report.
and:
"We have had a fairly sharp increase in wealth inequality dating back to 1975 or 1976. Prior to that, there was a protracted period when wealth
inequality fell in this country, going back almost to 1929. So you have this fairly continuous downward trend from 1929, which of course was the peak
of the stock market before it crashed, until just about the mid-1970s. Since then, things have really turned around, and the level of wealth
inequality today is almost double what it was in the mid-1970s.
Income inequality has also risen. Most people date this rise to the early 1970s, but it hasn't gone up nearly as dramatically as wealth
inequality.
The top 5 percent own more than half of all wealth. In 1998, they owned 59 percent of all wealth. Or to put it another way, the top 5 percent had
more wealth than the remaining 95 percent of the population, collectively.
The top 20 percent owns over 80 percent of all wealth. In 1998, it owned 83 percent of all wealth. This is a very concentrated distribution.
The bottom 20 percent basically have zero wealth. They either have no assets, or their debt equals or exceeds their assets. The bottom 20 percent has
typically accumulated no savings. A household in the middle-the median household - has wealth of about $62,000. $62,000 is not insignificant, but if
you consider that the top 1 percent of households' average wealth is $12.5 million, you can see what a difference there is in the distribution."
Edward Wolff, professor of economics at New York University
So charges of 'socialism' are being made to sully any attempt to balance the tax burden in this country. But if we want a current example of
'socialism' we need only look as far as the current financial systems bailout. Only those acts of socialism directly benefit the wealthier cohorts
so apparently it is OK. But not to everyone:
"As I've often said... this [increasing income inequality] is not the type of thing which a democratic society—a capitalist democratic
society—can really accept without addressing."
Alan Greenspan, June 2005
"Americans have the highest income inequality in the rich world and over the past 20–30 years Americans have also experienced the greatest
increase in income inequality among rich nations. The more detailed the data we can use to observe this change, the more skewed the change appears to
be... the majority of large gains are indeed at the top of the distribution."
Smeeding, T. (2005). Public policy, economic inequality, and poverty: The United States in comparative perspective. Social Science Quarterly, 86,
956-983.
The stability of a country is measured by the disparity in wealth between the lowest economic cohorts and the highest. The greater the disparity the
less stable a country is.
No one wants to pay higher taxes. But this country's finances have spun out-of-control and we're facing a long, grueling uphill climb to get things
back on-track. How do we distribute the costs of that climb?
Something that troubles me --- especially here on ATS --- is the preponderance of overly-simplistic, black-and-white arguments. There are few thiungs
in nature that are black-and-white. Fewer still in society. There is, instead, a nearly ifinite range of greys.
Personally, I'll end-up paying more taxes under the Obama plan. Like anyone else I'd rather not. But I'm a realist. Huge mistakes have been made
by the leadership of this country and we're all going to have pay the tab for that drunken kegger. I believe this country --- any country --- is
better off when people have hope. This isn't about lazy, underachievers. That argument is ridiculous if not outright insulting. It's about taking
responsibility. Which is worse, the single mother getting foodstamps to feed her kids becuase her take-home isn't enough to make ends meet or the
corporate CEO who can pay a tax accountant $1M to make sure he shelters all his income?
Keep one thing in mind all you blue-flag-waving folks: those military people that we need to honor? They're middle-class. Their families are
on-the-ropes. This 'wealth distribution' will help them, too.
