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Speaking Of Geniuses

I’ve mentioned before the coterie of standard bearers that I find useful to check in with from time to time (Rush, Ann, Charles), not so much to get marching orders (how convenient for the left) but as a sounding board/backstop, to reinforce opinions already reached (when they go off the deep end, they really go canonball), or to discover an angle I had not thought of. And probably the guy preeminent on that list is Mark Levin. I wrote a post several months ago disagreeing with Levin and his illogical (at least to me) rants attacking Christie. The other day I heard a radio snippet whereby he wanted those peeing Marines decorated, can’t even remotely go there. But pound for pound, he sees the forest for the trees better then most. Here is something from yesterday:

Yes, he is there to hawk his book, how Bain Capital of him, greedy bastard.

He hits a number of themes, all worthy of discussion, but I’m going to include a few here. He asks where this fundamental position exists whereby the stated goal is to level the playing field, to transition America to reduce income inequality, I know. Margaret Thatcher knew, a shared misery is more preferable then a tide rising ALL boats. But it is more insipid then that. We got a glimpse of this Noblesse oblige attitude with Hillary and her attempt to bullrush universal healthcare during her husband’s term, when she admitted that government sometimes needs to save it’s citizens from themselves, to make hard choices because they know better then the people what is good for them. This Marie Antoinette attitude of let them eat cake, the self anointed position the democrats have adopted whereby they are charged with championing the down trodden, the dis enfranchised, the discriminated, and the indigent, it gets them votes. Eating the rich is one way to appear benevolent and noble.

Neil asked Mark how today, and the challenges in front of us today, are different from say that of the Great Depression or the turn of the century. For one, we are in a $15 trillion dollar hole. The size and scope of the federal government (and its ravenous appetite), the expectations by those takers (not the providers), those that do not pay taxes and do not contribute to society but are a drain, they have grown both in numbers and their expectations of what is owed them, and also because today more than ever, world markets are inextricably linked, where we all hear and are affected by that lone tree falling in the forest, European bankruptcies (and our’s close behind) affect other nation’s economies.

TARP was also mentioned, with the usual finger pointing. Although the notion of Too Big To Fail hopefully has been buried once and for all, I am willing to give the original signatories a derision pass, given the circumstances at the time, as long as everyone adopts the position that ,”tried that once because we didn’t know better, now we do so never again”.

An orange juice can over Ron Paul, I need a minute to let that idea whaff over me. BTW, did anyone catch Paul’s incredible about face over killing OBL in last night’s debate? He is a slippery sucker. But his zero tax bracket idea was interesting (all candidates had to go on the record with their highest tax bracket, Paul’s was zero) crazy, but interesting.

I get the urgency that something must be done soon to stay the course and right the ship, and the elections this year could go a long way in that needed first step, but I just don’t see any quick painless fixes, for ourselves, the Europeans, or the world markets in general.

91 comments

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  1. CM says:

    Sullivan’s respohttp://andrewsullivan.thedailybeast.com/2012/01/why-obama-should-be-re-elected-ctd.htmlnse:

    Fox News has Mark Levin on to trash my article but they are far too afraid to have me on to defend it. I’ve been on the blacklist for years. Like Ron Paul, too dangerous for Fox. You might notice that they have actually blurred out my name on the cover. Heh.

    the stated goal is to level the playing field, to transition America to reduce income inequality, I know. Margaret Thatcher knew, a shared misery is more preferable then a tide rising ALL boats.

    Perhaps people would disagree that reduction in income inequality doesn’t have to be “shared misery”? I can’t even think how it COULD result in something so profound as ‘shared misery’. How would anyone actually be ‘miserable’ if the top 1% earnt 10-20% less and everyone else was better off?

    Eating the rich is one way to appear benevolent and noble.

    I think many moderates on left just roll their eyes at that sort of stuff and move on. It’s reads like a fundamental inability to consider that something you don’t agree with might have legitimacy – that is must be inherently nasty or evil or immoral. That there couldn’t possibly be a sincerity behind the belief. How is it different from someone suggesting, for example, that because you’re a right-winger you inherently must hate poor people (and because blacks are disproportionately poor, you must therefore hate black people)? (Or substitute that with anything else that ignores that you might actually have a right-wing belief system which is genuinely about making life better for everyone)

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  2. richtaylor365 says:

    Fox News has Mark Levin on to trash my article but they are far too afraid to have me on to defend it. I’ve been on the blacklist for years

    My, but he sure is full of himself. Mark did not utter one word, one syllable concerning the Newsweek article (I don’t know why they even led with it, it was not discussed). I guess Sullivan is whining about some other Fox show where Levin did cut in to him, that or he continues to see Fox goblins under his bed.

    Perhaps people would disagree that reduction in income inequality doesn’t have to be “shared misery”?

    I guess not, but since income inequality is part and parcel of any capitalist society (the have not’s are not happy with their station in life so either work harder or educate themselves better in an effort for them to become part of the have’s).

    I can’t even think how it COULD result in something so profound as ‘shared misery

    Easy, and clearly a priority for Obama, you keep beating the “paying their fair share” drum. By sticking it to the rich (eating them) you allow the poor some comfort in that they feel the rich are sharing some of their misery (not able to keep their wealth). Lincoln saw the absolute folly in this when he said ,” You cannot strengthen the weak by weakening the strong, You cannot help the poor man by destroying the rich, and you cannot further the brotherhood of man by inciting class hatred”. Wise words.

    How would anyone actually be ‘miserable’ if the top 1% earnt 10-20% less and everyone else was better off?

    And how would everyone else be better off? They did not earn that money you are taking away from the rich? Should the government just give “everyone else” that money that it took from the rich? See, this is propagating the same nonsense that sticking it to the rich will somehow make everyone else better off. I’m sure you have seen those links where it documents that if you tax those (around 300,00 taxpayers) making one million and over at 100%, leaving them nothing, even then all that money would not cover a quarter of the rise in the deficit, for one year.

    That there couldn’t possibly be a sincerity behind the belief.

    The concept of Nobles oblige is chalk full of sincerity, who says they aren’t sincere? Most of the motivation is to retain power and keep the status quo, but at the end of the day, they all get to pat themselves on the back, congratulating themselves on how noble they are, how altruistic, and how the cause of social justice has been furthered.

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  3. CM says:

    My, but he sure is full of himself. Mark did not utter one word, one syllable concerning the Newsweek article (I don’t know why they even led with it, it was not discussed). I guess Sullivan is whining about some other Fox show where Levin did cut in to him, that or he continues to see Fox goblins under his bed.

    It was indeed weird introducing it and then moving right to Levin’s book. although I guess the issues being discussed overlap both books. As quoted in the other thread, it appears Sullivan had much more of an issue with Megyn Kelly. Contrary to his assertion that Fox would never have him on, he updates with: “Megyn Kelly’s producer says he is looking into having me on to defend myself and my essay.”

    I guess not, but since income inequality is part and parcel of any capitalist society (the have not’s are not happy with their station in life so either work harder or educate themselves better in an effort for them to become part of the have’s).

    The problem with using terms such as ‘shared misery’ is that they are so loaded. It’s almost as if they’re used as a warning to anyone who might otherwise be interested in discussing the actual issue. I attempted to discuss the issue of income inequality here (is it even an issue?, if so then what can be done that would still be consistent with conservative philosophy? etc) about 6 weeks ago but nobody was very interested.

    I would certainly agree that capitalism (which I support) relies on some people doing better than others. The system simply cannot function otherwise. Some people have to be the employers and some have to be the employees. Some will be rewarded with vast sums, and some will be rewarded with barely enough to get by. But is it not possible that cracks start to appear when things are taken to an extreme? Is there anything inherently in the system to stop this in it’s tracks – some might say busts, but do they really reset anything, or do they just temporarily slow the overall trend?

    It’s inherently impossible for more than a certain number of ‘have-nots’ to do all the Right Things so they become ‘haves’. So what happens when/if we reach a point where too many people don’t get to be ‘haves’? Currently it doesn’t look too sustainable. Surely any supporter of capitalism would want the system to be sustainable.

    Easy, and clearly a priority for Obama, you keep beating the “paying their fair share” drum. By sticking it to the rich (eating them) you allow the poor some comfort in that they feel the rich are sharing some of their misery (not able to keep their wealth).

    Again, I’m confused as to how this meets any reasonable definition of ‘misery’ for the rich. It would seem to be making a mockery of the word. Same with the term ‘eating the rich’. Unless some sort of awful pain can be demonstrated, the term just seems to be hyperbole. If they’re forced to pay a few cents more on the dollar, they’ll be just be……slightly less rich. Won’t they?
    How has Obama’s ‘paying their fair share’ drum manifested into policy?

    Lincoln saw the absolute folly in this when he said ,” You cannot strengthen the weak by weakening the strong, You cannot help the poor man by destroying the rich, and you cannot further the brotherhood of man by inciting class hatred”. Wise words.

    Not particularly relevant though I would have thought, unless it can be shown that Obama’s policies have weakened the strong. How has the rich man been ‘destroyed’?

    ‘Destroyed’, ‘shared misery’, ‘eating the rich’…..these seem to me to be quite extreme reactions that don’t seem to match reality.

    And how would everyone else be better off? They did not earn that money you are taking away from the rich?

    You didn’t answer my question – I’m trying to determine how ‘misery’ occurs.

    Should the government just give “everyone else” that money that it took from the rich?

    Depends how it’s used (spending on infrastructure would benefit all, including the rich). And it also depends how you want to describe it (again, I don’t really view the money I pay in income tax as ‘mine’, or that it’s been ‘taken off me’, because it was never mine to begin with. I don’t view it 100% the other way either – I recognise that it I was taxed less I’d get more of it).

    See, this is propagating the same nonsense that sticking it to the rich will somehow make everyone else better off.

    I agree that ‘sticking it to the rich’ (whatever that means) doesn’t necessarily make everyone else better off. However a sense that incomes aren’t so hugely unequal (and that this will increase with no end in sight) might make for a better society. One where tensions don’t continue to increase. Or do the people who can afford it just building larger walls? Anyway the point was – how does attempting to do something about income inequality inherently mean that everyone has to suffer ‘misery’. I mean ‘misery’ occurs when people die, or when people lose their homes, jobs and family in a single week.

    I’m sure you have seen those links where it documents that if you tax those (around 300,00 taxpayers) making one million and over at 100%, leaving them nothing, even then all that money would not cover a quarter of the rise in the deficit, for one year.

    I haven’t seen it. I would agree that any discussion over whether or not to tackle increasing income inequality, or whether in fact it shouldn’t be touched because it’s not relevant to anything, is a discussion where wider issues such as public debt are relevant considerations.

    I don’t want capitalism to be toppled. It’s for that reason that I want it to be sustainable – so that it can continue. But I fear that it isn’t sustainable while gaps continue to increase. It goes beyond basic economics – it’s about the environment we’d rather live in. Stiglitz goes into this here.

    The concept of Nobles oblige is chalk full of sincerity, who says they aren’t sincere? Most of the motivation is to retain power and keep the status quo, but at the end of the day, they all get to pat themselves on the back, congratulating themselves on how noble they are, how altruistic, and how the cause of social justice has been furthered.

    Yeah I can do without all that too. But if we put the self-promotion and holier-than-tho stuff aside, what I’m saying is it is actually possible to hold beliefs that don’t seek misery on people. There is a large area in the middle where beliefs seek to find some balance between the competing forces and variables.

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  4. CM says:

    I don’t think taxing investments (which is how the really rich, like Romney, earn ‘income’ – their money earns money, rather than their labour earning money) at something closer to income tax (e.g. move it from 15% to 18%) is going to result in misery. Or bring down capitalism. If some average Joe is working 50 hours a week and paying 30% income tax, why should he not be annoyed that people who are already really rich are entitled to pay a lower rate, simply because they can afford to earn a substantial amount of their income via investments? (And this isn’t necessarily money that is risked by creating jobs – equity firm managers aren’t risking their own money, yet receive a share of whatever their firm makes for investors).

    Please don’t take this to mean that I’m saying rich people didn’t earn the right to be rich, or that they don’t have a right to keep getting richer. Or that being rich inherently makes them arseholes, or ‘less noble’. Or that they need to suffer misery. Or any of the other million things that invariably get thrown at me in an attempt to derail and end the discussion (not by you Rich).

    BTW I don’t think people like Romney help this growing unease about income inequality when he suggests that the $374,000 they earned in speaking fees last year is “not very much”. That alone would put him in the top 1%. Perhaps he means “compared to what else I earnt”, but that doesn’t really help the perception. Especially when you add it to “corporations are people too” and calling himself unemployed because his money makes money and joking about being worried about pink slips.

    Obama might find plenty of traction with this issue amongst moderates. The Obamas apparently paid more 26 percent in 2010, as opposed to Romneys’ self-declared 15%. Obama was still paying off student loan and credit card debt just a few years before he joined the Senate. Anyway, we’ll see how that one plays out once Romney is chosen…

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  5. richtaylor365 says:

    .I attempted to discuss the issue of income inequality here (is it even an issue?, if so then what can be done that would still be consistent with conservative philosophy? etc) about 6 weeks ago but nobody was very interested.

    Couched in what terms? If presented from a position that we must do something about it, I would ask why? It is byproduct of the economic system that we live. I would even posit that it provides a healthy motivation for folks to better themselves. We encourage our kids to do well in school so that they can get in to a good college, we don’t do it because as parents we look forward to paying large some in tuition, we do it because it is a ticket to a better life. That is what capitalism offers us, a better life. Complaining about income equality is like complaining because no one will hire you or you have to start out at minimum wage, or you can’t become CEO as your first job. It is a competitive process, not everyone gets to win the race, get the gold metal, or come in first, that is why we compete, there will be winners and losers, but that is the economic system we have, winners and losers. There will always be losers, but if they want, they can train (get better qualified for that job they want) and compete another day.

    But is it not possible that cracks start to appear when things are taken to an extreme?

    How are things “extreme”, and how would we even know it? I’m trying to think of a time in our history, the history of any free market democracy when there were not rich people and poor people, can you think of a time? Yes, we have high unemployment, but does that constitute “extreme”? As long as you work hard and obtain your wealth lawfully, what is extreme? Would you put a ceiling on how much money someone can earn or accumulate?

    It’s inherently impossible for more than a certain number of ‘have-nots’ to do all the Right Things so they become ‘haves’.

    Absolutely, but the system accounts for this. There will always be the indolent, the lazy, those not possessed with the requisite intelligence (slept all thru school) and those with either the physical or mental disabilities that limit them. For those genuinely in need and can’t provide for themselves, society will do that for them, for the clueless and the lazy, they get whatever crappy job they want to drag their butt to each day. But for the industrious, those with a work ethic, and those that want to better themselves, they don’t call this the land of opportunity for nothing.

    Again, I’m confused as to how this meets any reasonable definition of ‘misery’ for the rich

    The misery is subjective. No, he is not starving and homeless. But for the small business man that works 60 hour work weeks, that has not had a vacation in years, drives a shitty car and plows all of his profits back into his business, ask him how he feels about his taxes being raised and his business stifled at every turn by onerous regulations, misery might be the first word that comes to mind.

    the term just seems to be hyperbole.

    It’s not hyperbole for the guy that plays by the rules and works his ass off, all in the pursuit of his American dream, but to be cut off at the knees at every turn. The risk/reward concept goes right out the window if a guy risks everything but then can’t be rewarded at the end.

    How has Obama’s ‘paying their fair share’ drum manifested into policy?

    Again, because making the rich more miserable (by taking more of their hard earned wealth) does not elevate the poor in any way, it even exacerbates the problem because he has less money to hire more workers. Nor does it really solve the problem of deficits, so the only reason he beats this drum is to make his supporters happy.

    again, I don’t really view the money I pay in income tax as ‘mine’, or that it’s been ‘taken off me’, because it was never mine to begin with.

    HUH!! Of course it was yours, who do you think earned it? You do realize that every dollar you pay in income tax is one less earned dollar that you can spend, that you can put back in to the economy, that you can use to put food on your table and shelter your family? Why bother working if you can not secure the blessings and prosperity of that earned wealth? You lost me here.

    However a sense that incomes aren’t so hugely unequal (and that this will increase with no end in sight) might make for a better society.

    When have they not been “hugely unequal”?
    What makes for a better society is when the greatest percentage of citizens believe that it is within their power to partake in the American dream, that their station in life can only be enhanced by their own industry and hard work, and that the government will not hinder them in this pursuit.

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  6. richtaylor365 says:

    I don’t think taxing investments (which is how the really rich, like Romney, earn ‘income’ – their money earns money, rather than their labour earning money) at something closer to income tax (e.g. move it from 15% to 18%) is going to result in misery

    Tell that to the retired machinist or bus driver who could not get a pension, SS is not enough to live on, he relies on those dividends from the few stocks he owns to make ends meet, tax those at the ordinary income rate (instead of the 15% it is now) and now he has to eat cat food to live. I don’t have the stats in front of me but so you realize how many retired people count of dividend income to live? They aren’t all Warren Buffets.

    , why should he not be annoyed that people who are already really rich are entitled to pay a lower rate, simply because they can afford to earn a substantial amount of their income via investments?

    Because he understands the difference between ordinary income (what you get paid in salary) and the dividend rate. Do you remember those posts written a few months ago that categorically showed that the rich are paying their fair share? The rich pay at the highest income tax rate. We can discuss the pros and cons of a progressive tax system if you like but this apples to oranges stuff (ordinary income tax rate to that of the dividend or cap gain tax rate) is nothing but a smoke screen.

    Especially when you add it to “corporations are people too” and calling himself unemployed because his money makes money and joking about being worried about pink slips.

    I understand what he means by “corporations are people too”, they employ people who earn wages from the corporation, wages which are used to support families.

    Anyway, we’ll see how that one plays out once Romney is chosen…

    To this point I am exasperated at how Romney has answered these rather easily answered allegations. Not that I am a Romney supporter but so far he looks weasily. Maybe he is rope a doping, not wishing to play his hand too soon, saving the good stuff for when he goes against Obama.

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  7. hist_ed says:

    How would anyone actually be ‘miserable’ if the top 1% earnt 10-20% less and everyone else was better off?

    That’s not the only possibility. If the richest 1%saw the incomes cut by 30% and the poorest 20% saw their incomes cut by 10% then income inequality would have been narrowed. Would that be a good thing?

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  8. CM says:

    Couched in what terms?

    Couched in terms of the example questions I just repeated.

    If presented from a position that we must do something about it, I would ask why?

    You’re certainly entitled to think that nothing should be done. To clarify, I mean ever-increasing inequality.Personally, I wouldn’t want to mess with it (in terms of specifically targeted policies or changes to existing policies) unless those at the bottom really aren’t earning a living wage (being defined as a wage that doesn’t provide enough to provide basic accomodation, food, etc). Are we there yet? Perhaps we are. If a working person requires support from elsewhere to supplement what they get from their full-time job in order to live a fairly basic life, does that not suggest an issue? When a reasonable percentage of the population is comprising of these people, does that not suggest that things are out of equilibrium?

    It is byproduct of the economic system that we live.

    Income inequality is, no doubt. But is increasing (permanently?) income inequality? Is that an inherent byproduct?

    I would even posit that it provides a healthy motivation for folks to better themselves. We encourage our kids to do well in school so that they can get in to a good college, we don’t do it because as parents we look forward to paying large some in tuition, we do it because it is a ticket to a better life. That is what capitalism offers us, a better life.

    Totally, and this is why I’m a capitalist, first and foremost. I’ll be doing everything possible to assist my kids to be successful, just like most other parents. But I hope if they’re doing decent jobs, they’ll be paid a decent wage. There seem to be a whole lot of jobs that don’t pay all that well.

    Complaining about income equality

    Again, it’s an ongoing increase in the inequality that’s the issue I’m interested in (but which might not concern you or others). Apologies if I failed to make that clear.

    It is a competitive process, not everyone gets to win the race, get the gold metal, or come in first, that is why we compete, there will be winners and losers, but that is the economic system we have, winners and losers. There will always be losers, but if they want, they can train (get better qualified for that job they want) and compete another day

    But are we reaching a situation whereby people do train for jobs (teachers, firefighters, etc) and end up earning barely enough to live on, while those that are past a certain threshold can just allow their money to earn money without doing anything? I’m not saying the rich that do that are bad, or shouldn’t be able to, I asking what the effect on society is? Or does it not matter? How can it not matter?

    How are things “extreme”, and how would we even know it? I’m trying to think of a time in our history, the history of any free market democracy when there were not rich people and poor people, can you think of a time? Yes, we have high unemployment, but does that constitute “extreme”? As long as you work hard and obtain your wealth lawfully, what is extreme? Would you put a ceiling on how much money someone can earn or accumulate?

    No I would resist putting a ceiling on how much anyone can earn/accumulate. Stiglitz puts this better than I have in that piece I linked to. I think his argument that it’s to everyone’s benefit to at least have people living on the same economic planet makes sense.

    Absolutely, but the system accounts for this. There will always be the indolent, the lazy, those not possessed with the requisite intelligence (slept all thru school) and those with either the physical or mental disabilities that limit them. For those genuinely in need and can’t provide for themselves, society will do that for them, for the clueless and the lazy, they get whatever crappy job they want to drag their butt to each day. But for the industrious, those with a work ethic, and those that want to better themselves, they don’t call this the land of opportunity for nothing.

    I’m talking more about the huge number of jobs that pay minimum wage or close to it. It’s absolutely essential that we have a large number of people to do these jobs. Many of these could have done all the right things. But it’s an obvious fallacy that all of them can ‘make it’. So even though someone does everything right, they’re at the mercy of what those minimum wage jobs provide them. Is it enough to live on? Why not, if they did everything right, and they’re just one of the unlucky ones (unlucky because of the fallacy)?

    The misery is subjective. No, he is not starving and homeless. But for the small business man that works 60 hour work weeks, that has not had a vacation in years, drives a shitty car and plows all of his profits back into his business, ask him how he feels about his taxes being raised and his business stifled at every turn by onerous regulations, misery might be the first word that comes to mind.

    Can you provide an example of someone who has had taxes raised and is “stifled at every turn by onerous regulations”? That reads like hyperbole to me. I mean “every” turn? Really? That doesn’t sound like any western country I’ve ever visited or heard about.

    It’s not hyperbole for the guy that plays by the rules and works his ass off, all in the pursuit of his American dream, but to be cut off at the knees at every turn.

    “Cut off at the knees”?
    I can see that literally being cut off at the knees would result in misery. But obviously this is an expression. Much like all the others. They are all rather extreme though, and don’t really paint an realistic picture though do they?

    The risk/reward concept goes right out the window if a guy risks everything but then can’t be rewarded at the end

    I support capitalism, so I certainly agree that the system requires rewards. I’d never advocate that people shouldn’t be rewarded. I apologise if I gave that impression – I certainly tried to make it clear that the system should reward the right things. My issue is more about disparities in the rewards. if people working their asses off doing menial jobs (which our societies need) earn 1000 times less than someone else who works relatively hard, but not too hard, sitting at a desk in an office, then isn’t the reward system a little skewed? I understand your theory that this means the menial worker will try even harder to make it, but most won’t, and it more often than not it won’t be any fault of theirs that they don’t. The numbers just don’t work (the fallacy).

    Again, because making the rich more miserable (by taking more of their hard earned wealth) does not elevate the poor in any way, it even exacerbates the problem because he has less money to hire more workers. Nor does it really solve the problem of deficits, so the only reason he beats this drum is to make his supporters happy.

    My questions was about specifics: which policies of Obama (individual or as a whole) have ‘eaten the rich’? To the point where any of the rich are miserable (by any definition of the word). Would you acknowledge that to someone busting their ass doing a menial job, hearing that some rich person is ‘miserable’ because they had to pay a couple more percent tax on their investment to pay increased teachers pay would seem obscene? Would they have reason to think that $374,000 being considered “not very much” would have to be someone living in a different economic environment? What would they have in common in any way, shape or form, let alone economically with a person like that?

    HUH!! Of course it was yours, who do you think earned it?

    Nobody earnt it. It’s just the way our society generates money to pay for things for all of us. I didn’t earn that money to give to the government. They don’t put it in my account and then take it right out again. I never actually see it. It’s as close to not existing as you can possibly get. That’s not to say that I don’t want tax money spent properly, transparently, and in an accountable manner. Nor do I want what I actually get to reduce unless there is a really good reason to do so.

    You do realize that every dollar you pay in income tax is one less earned dollar that you can spend, that you can put back in to the economy, that you can use to put food on your table and shelter your family? Why bother working if you can not secure the blessings and prosperity of that earned wealth? You lost me here.

    I’m happy with the money I get paid (that I get in my hand) relative to the work that I do. I do a hell of a lot less than a shitload of people that get paid much less than me. Yes, if tax rates were lowered, I would take home more. But I’m not sure what I’d want cut in terms of government spending.

    When have they not been “hugely unequal”?

    The rise of the middle class in the middle of last century came at a time when income equality decreased significantly. Krugman has a graph illustratring this here.
    http://krugman.blogs.nytimes.com/2007/09/18/introducing-this-blog/

    What makes for a better society is when the greatest percentage of citizens believe that it is within their power to partake in the American dream, that their station in life can only be enhanced by their own industry and hard work, and that the government will not hinder them in this pursuit

    That is great (it really is). But the majority of people will fail, and this is not because they won’t or don’t try, it’s because it’s impossible for it to be any other way. So the issue is – do most of these people languish earning barely enough to survive, or can enough of them still make it to ‘middle class’? The middle class is getting smaller and smaller. Why binds the languishing and the rich? How does the whole system continue to function smoothly when more and more people realise that they have realistically pretty much no shot of getting to that 1%, and an increasing number of the remaining 99% are struggling to survive? That is my concern. Or is that really not a valid concern?
    Honestly, it would better if I was able to be convinced that I’m being silly. I’d much rather not be concerned. It’s not that I lie awake at night thinking about it, it’s more a curiousity.

    Thanks for your comments Rich. Great to get a discussion going.

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  9. Poosh says:

    Sullivan is an unhindged idiot incapable of reasoning. He lost it ages ago and is fanatical. There is no reason to read a word he says nor give a flying fuck about his response. Where have all the sensible, sane leftists gone? Or was Christopher Hitchens the last true liberal?

    Thatcher was of course right. But that’s hardly surprising. Desire to fix “income inequality” which is a loaded term of course, in modern western countries, is nearly always born from resentment and envy, or simply the desire to gain votes from lower/underclasses. It works quite well. Usually stems from Marxist myths.

    And having money you earned or came across by chance, stolen from you, by the government, and dispersed to people like a drug by politicians who get the credit (and increase their power because of the money they have stolen off the rich), is certainly a source of misery.

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  10. richtaylor365 says:

    You’re certainly entitled to think that nothing should be done.

    To do what precisely? To counter the negative affects of a system we both agree to live by? As a conservative I would like everyone to establish a work ethic, to strive to be the best they can be and to get their shot at the American dream. Some, either by personal choices or personal vices or situations beyond their control but are inherent with capitalism, will not make it. As far as I’m concerned the only thing that can be done about income inequality to remove as many impediments to the free market system as possible and allow it to work, for two reason, because that is the system that creates the most prosperity for the greatest number of people, and because it is the only type of government most consistent and conducive to liberty.

    If a working person requires support from elsewhere to supplement what they get from their full-time job in order to live a fairly basic life

    If they can not afford to live on their own then society provides for them in the form of welfare. But as I mentioned before, living at the poverty level, just like working for minimum wage, should not be comfortable. We want the poor to not be satisfied or comfortable. Minimum wage was never designed to carry someone thru life and to support a family, it is a starting point whereby you earn something to get by until you can better yourself. This could dove tail into a separate post on welfare and it’s roles. When the government provides for you to the extent that you are comfortable, happy with your lot in life and perfectly willing to continue in your state, then government is doing something wrong.

    There seem to be a whole lot of jobs that don’t pay all that well.

    And that is by design, they are “starter” jobs, jobs that go to the unskilled. Those in these jobs should be hungry and unsatisfied, we want them to consider this as only temporary so they can get experience and an education, get a better paying job doing skilled labor.

    it’s an ongoing increase in the inequality that’s the issue I’m interested in

    That increase can only be addressed within the parameters of the free market system, allow it work unimpeded and unencumbered. By allowing folks to keep the greatest percentage of THEIR money (this instills a desire to take risks and work hard), by getting out of the way of business and commerce, letting them do what they would do naturally, invest in their own company by hiring more workers, that income inequality (and the unemployment rate) will find it’s proper center, just like water in a cup.

    Or does it not matter?

    I don’t think it does, here’s why. The system as it was designed and first practiced works fairly well in that it accounts for the unskilled, (low wages) and provides a built in impetus, that of improving the quality of your life. We need folks to embrace a work ethic so that they will fend for themselves and not look for hand outs. But we also need the “example” of the rich as that brass ring so that those not rich can see for themselves the benefits of working, the benefits of “making it”. We also need an unobtrusive government so that those not rich don’t get discouraged saying t themselves ,”Why should I work hard, they will just take my profits from me”.

    But it’s an obvious fallacy that all of them can ‘make it’. So even though someone does everything right, they’re at the mercy of what those minimum wage jobs provide them. Is it enough to live on? Why not, if they did everything right, and they’re just one of the unlucky ones (unlucky because of the fallacy)?

    This is one of your best points in this whole thread. The facts are these, fairness is not really part of capitalism. Joe can do all the right things and be stand up, but if a competitor designs a better product that people want, and unless Joe can adapt, he is out on his ass, along with his family, winners and losers, no getting around that. But that is not the end of the story. Joe, if he is so inclined, can pick himself back up, go back to school, get another job, or do something with himself so that he can compete again, so that maybe he invents the product that will put his competitor out of business.

    Can you provide an example of someone who has had taxes raised and is “stifled at every turn by onerous regulations”?

    Have you not read about those small businesses that have gone under or predict going under because of Obamacare? Google Obama’s war on business. You remember 2 years back the tussle he got into with the BBB? Where they complained that his policies were anathema to job creativity and he decided to take it personally and go after them?

    They are all rather extreme though, and don’t really paint an realistic picture though do they?

    Refer to my above response, these folks are partial to getting their knees back.

    Nobody earnt it. It’s just the way our society generates money to pay for things for all of us.

    We’ll just have to agree to disagree on this one. I would think 99.9% of all wage earners feel that they earned that money and would prefer a greater say in how much of that money is taken from them in the form of taxation.

    Good discussion, and no where did you accuse me of having a little penis or that my mom is so low she plays handball against the curb, curious.

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  11. AlexInCT says:

    Thatcher was of course right. But that’s hardly surprising. Desire to fix “income inequality” which is a loaded term of course, in modern western countries, is nearly always born from resentment and envy, or simply the desire to gain votes from lower/underclasses. It works quite well. Usually stems from Marxist myths.

    THIS ^^^^

    Add to it that the elites that think pushing marxism will let them take power away from those that have it now and that this isn’t about helping anyone but themselves, and you have the complete picture. I trust a guy that admits he is out to do well for himself over the guy that tells me he wants to stamp out injustice and help everyone any day of the week. One is being honest and good. The other is a crook that is hiding behind the pretense of wanting to do good to fuck us all over.

    I happened to see Levin do this interview as well and it was pure genius. And yeah, Sullivan is a self obsessd douche.

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  12. ilovecress says:

    Income inequality (or equality) isn’t the end game. It’s merely an indicator. In a capitalist system, there will always be (and should be) inequality, as those who do better should do better.

    I think that we agree on more than we think. The goal for the system to flourish and to become sustainable is opportunity. How feasible is it for someone to be able to become one of the 1%. Or even to do better than their parents.

    CM will have seen in the NZ press a study that basically states that in NZ, the ‘status’ (for want of a better word) into which you’re born basically is the one in which you’ll end up.

    I think the debate gets muddied as people assume that the only barrier to success is a lack of work ethic, or a desire to succeeed. Now there are two problems with this, firstly this isn’t always the case, and secondly that as income inequality grows, it makes it harder and harder to break into the top group, which leads to young people not even trying – creating the dreaded ‘underclass’.

    And I see it not just from a lefty-pinko-liberal-kumbahyah point of view. In NZ we can’t always rely on agriculture and dairy for our economic future – it’s going to come from innovation and the small businesses. And to gamble that these ideas and innovations are going to come from the percentage of the population that have the most opportunity to succeed seems like a risky one to take on the future of the economy.

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  13. Miguelito says:

    The problem with using terms such as ‘shared misery’ is that they are so loaded. It’s almost as if they’re used as a warning to anyone who might otherwise be interested in discussing the actual issue. I attempted to discuss the issue of income inequality here

    …and part of the problem is that the phrase “income inequality” is itself so loaded. It’s usually used by people who are looking for excuses to tax/penalize one set of people in order to play Robin Hood and buy off another set of people.

    I liken it to other phrases whose use in political circles has essentially watered down to near meaningless, like “Affordable housing.”

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  14. hist_ed says:

    My issue is more about disparities in the rewards. if people working their asses off doing menial jobs (which our societies need) earn 1000 times less than someone else who works relatively hard, but not too hard, sitting at a desk in an office, then isn’t the reward system a little skewed?

    No it isn’t. That desk jockey’s work is valued by the people paying for it 1000 times more that the menial workers.

    Free markets aren’t perfect. They are the least worst system out there. What would be a lot worse would be a government committee deciding how much each desk jockey should be paid.

    I am happy to admit that I think our society’s values on some professions are a bit messed up. I think the fortunes we pay to Hollywood stars and NFL players are crazy, but they are an accurate reflection of how our society values their work. Any government solution to this problem would be a lot worse than the disease.

    CM, if I may, may I turn my little post above around a bit to ask you a question? If I had a magic wand I could wave and it would, in a year, raise the incomes of the poorest people and the middle class by 10% but would raise the incomes of the upper 1% by 25% would you be in favor of waiving that wand? Everyone would be wealthier, but the income gap between rich and poor would be greater.

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  15. AlexInCT says:

    No it isn’t. That desk jockey’s work is valued by the people paying for it 1000 times more that the menial workers.

    THIS^^

    The idiotic notion that there is an unjust disparity between what one person gets paid to do jobs everyone else, without any training, can do, versus someone with ultra specialized skills that are incredibly hard to come by is the root of all our problems. We pay the doctor and the airline pilot a lot of money because it is really hard to do what they do and we want only the best people to do what they do. We pay the guy asking you if you want fries with that a minimum wage because government forces us to pay him far higher for a job any shlob off the street is just as qualified to do.

    This injustice bullshit harkens from the idiotic marxist notion that labor per se is the value, and that what that labor produces or how much training and learning is necessary to perform that labor, should not matter or factor in. So a guy that does micro brain surgery or assembles complicated and delicate items, like aircraft engines or micro chips for computers or other high end appliances, or even someone doing complicated engineering work to produce plans for new cars, planes, or ships results in the exact same value as for example a guy that is put to work polishing turds. If these fuckers where right we could employ everyone at doctors wages to polish turds – after all what skills are needed to do that – and the economy would be booming. Not to mention that we all would be equal and that injustice of income would be gone. I am sure they would not have any problem selling off those higly polished turds for thousands of dollars per unit, considering the cost to polish them so well….

    Marxism and the spin off nonsense that engendered such idiotic concepts as “injustice of wages” and “lack of social justice” are the worst evils perpetuated on mankind, ever. It has become justification for the most corrupt people to steal from the productive to buy the votes of the usual losers. This is why I am certain this whole line of thinking can only end with another dark age and lots of tyranny for all.

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  16. CM says:

    Tell that to the retired machinist or bus driver who could not get a pension, SS is not enough to live on, he relies on those dividends from the few stocks he owns to make ends meet, tax those at the ordinary income rate (instead of the 15% it is now) and now he has to eat cat food to live. I don’t have the stats in front of me but so you realize how many retired people count of dividend income to live? They aren’t all Warren Buffets.

    Good point. It would be interesting to see some stats on that, if there are any. But perhaps it’s more about a package. Raising investment income slightly and reducing personal income tax levels slightly.

    Do you remember those posts written a few months ago that categorically showed that the rich are paying their fair share? The rich pay at the highest income tax rate. We can discuss the pros and cons of a progressive tax system if you like but this apples to oranges stuff (ordinary income tax rate to that of the dividend or cap gain tax rate) is nothing but a smoke screen.

    I missed that thread. I’ll see if I can find it (although that’s pretty much impossible with this format). The rich pay less tax than they ever have, and are richer than they’ve ever been. Once you’re rich, you’ve got it easier than ever before (and it’s easier to keep making money). The issue may be the increasing inability of people to move up to that level. The middle class is shrinking, and this is a multi-decade trend now, which transcends booms and busts. While the top 1 percent have seen their incomes rise 18 percent over the past decade, those in the middle have actually seen their incomes fall. Will that continue? If so, it is a sustainable society that is comprised almost exclusively of people who are either rich or a struggling? Or does that lead to some serious break-down?

    Stiglitz:

    Some people look at income inequality and shrug their shoulders. So what if this person gains and that person loses? What matters, they argue, is not how the pie is divided but the size of the pie. That argument is fundamentally wrong. An economy in which most citizens are doing worse year after year—an economy like America’s—is not likely to do well over the long haul. There are several reasons for this.

    First, growing inequality is the flip side of something else: shrinking opportunity. Whenever we diminish equality of opportunity, it means that we are not using some of our most valuable assets—our people—in the most productive way possible. Second, many of the distortions that lead to inequality—such as those associated with monopoly power and preferential tax treatment for special interests—undermine the efficiency of the economy. This new inequality goes on to create new distortions, undermining efficiency even further. To give just one example, far too many of our most talented young people, seeing the astronomical rewards, have gone into finance rather than into fields that would lead to a more productive and healthy economy.

    Third, and perhaps most important, a modern economy requires “collective action”—it needs government to invest in infrastructure, education, and technology. The United States and the world have benefited greatly from government-sponsored research that led to the Internet, to advances in public health, and so on. But America has long suffered from an under-investment in infrastructure (look at the condition of our highways and bridges, our railroads and airports), in basic research, and in education at all levels. Further cutbacks in these areas lie ahead

    .

    Not that I am a Romney supporter but so far he looks weasily. Maybe he is rope a doping, not wishing to play his hand too soon, saving the good stuff for when he goes against Obama.

    That was my thought too. He must have something more in the tank. That can’t possibly be his A Grade material.

    (from your next post:)

    To do what precisely? To counter the negative affects of a system we both agree to live by?

    To ensure capitalism is sustainable and works well enough for a sufficient number of people.

    As a conservative I would like everyone to establish a work ethic, to strive to be the best they can be and to get their shot at the American dream. Some, either by personal choices or personal vices or situations beyond their control but are inherent with capitalism, will not make it. As far as I’m concerned the only thing that can be done about income inequality to remove as many impediments to the free market system as possible and allow it to work, for two reason, because that is the system that creates the most prosperity for the greatest number of people, and because it is the only type of government most consistent and conducive to liberty.

    That’s persuasive on its face. And I agree with the general thrust of it. But does that mean we shouldn’t examine what actually happens in reality? What you’re suggesting is that if everything is set up in favour of the rich, everyone will benefit. But that’s not what we see. The easier it is for the rich to get and stay rich, the smaller the middle class appears to get. If they’re not rich, and not middle class, where exactly are the remaining people?

    If they can not afford to live on their own then society provides for them in the form of welfare. But as I mentioned before, living at the poverty level, just like working for minimum wage, should not be comfortable.

    I certainly disagree with this. Considering how many people we need to be working on these jobs at all times, and how important those jobs are to society, it doesn’t make sense to me that these people should be living uncomfortable lives. That sounds very much like a failed system to me.

    We want the poor to not be satisfied or comfortable.

    The alternative is to be satisfied with a system whereby people live unsatisfied and uncomfortable lives. Yes, I know the answer is “then they can work even harder and move up”, but it is literally impossible for that to happen to most people. That’s the reality. It’s not an excuse, it’s inherently built into the system. And if the middle class continues to shrink, that means people aren’t heading up into the middle class, they’re dropping down below it.

    Minimum wage was never designed to carry someone thru life and to support a family, it is a starting point whereby you earn something to get by until you can better yourself. This could dove tail into a separate post on welfare and it’s roles. When the government provides for you to the extent that you are comfortable, happy with your lot in life and perfectly willing to continue in your state, then government is doing something wrong.

    Low wages (wages that make life difficult) is a different issue than surviving on unemployment welfare. I’m all for making life on welfare reasonably uncomfortable. Uncomfortable enough to provide an incentive to work (in addition to conditions such as proof that you’re either unable to work or actively seeking work).

    And that is by design, they are “starter” jobs, jobs that go to the unskilled. Those in these jobs should be hungry and unsatisfied, we want them to consider this as only temporary so they can get experience and an education, get a better paying job doing skilled labor.

    How about the loss in real wages associated with skilled jobs? Why are such a large number of skilled people qualifying for assistance? Why are jobs previously associated with the middle class now jobs that don’t pay enough to adequately live on? Firefighters and schoolteachers are in that list of people struggling – they now pay almost no federal income tax because they don’t earn enough to do so. They didn’t used to be. So what incentive do people on minimum wage jobs have to retrain to become firefighters or teachers, if it just means they’ll be struggling only slightly less?

    I believe in democracy (more than I believe in capitalism), so if your country wants to get more capitalistic, or less capitalistic, then that’s entirely up to you. If you can convince enough moderates that there is too little capitalism, and that explains many of the big issues facing your country, then you should see things moving in the direction you want. But presumably you’ll only be able to convince people if your arguments are able to be supported with good evidence, and match up somewhat with their reality. How does an increase in people struggling over a number of decades, while the people at the very top get richer and richer, provide good evidence that the system is working?

    That increase can only be addressed within the parameters of the free market system, allow it work unimpeded and unencumbered. By allowing folks to keep the greatest percentage of THEIR money (this instills a desire to take risks and work hard), by getting out of the way of business and commerce, letting them do what they would do naturally, invest in their own company by hiring more workers, that income inequality (and the unemployment rate) will find it’s proper center, just like water in a cup.

    If the system is ‘unimpeded and unemcumbered’ then you believe the trend will either stop or be reversed? Can you explain how? If the middle class pay little in federal income tax now anyway*, how is it possible for them to pay even less? What mechanism occurs that increases their wage, and how does that get triggered? I.e. how does the increase stop (or how is it reversed) via natural market forces?

    *

    Focusing on the statistical middle class — the middle 20 percent of households, as ranked by income — underlines this point. Households in this group made $35,400 to $52,100 in 2006, the last year for which the Congressional Budget Office has released data. That would describe a household with one full-time worker earning about $17 to $25 an hour. Such hourly pay is typical for firefighters, preschool teachers, computer support specialists, farmers, members of the clergy, mail carriers, secretaries and truck drivers, according to the Bureau of Labor Statistics.

    Taking into account both taxes and tax credits, the average household in this group paid a total income tax rate of just 3 percent. A good number of people, in fact, paid no net income taxes. They are among the alleged free riders.

    So the middle class is shrinking, and even the middle class that exists is only middle class because they pay almost no federal income tax. So they’re being artificially positioned as middle class. Which means the real ‘middle class’ is even smaller. No?

    I don’t think it does, here’s why. The system as it was designed and first practiced works fairly well in that it accounts for the unskilled, (low wages) and provides a built in impetus, that of improving the quality of your life. We need folks to embrace a work ethic so that they will fend for themselves and not look for hand outs. But we also need the “example” of the rich as that brass ring so that those not rich can see for themselves the benefits of working, the benefits of “making it”. We also need an unobtrusive government so that those not rich don’t get discouraged saying t themselves ,”Why should I work hard, they will just take my profits from me”.

    That’s the basic theory again. I acknowledge it and realise it and accept it. However does that mean we can’t look at what actually happens in reality? If that basic theory results in 5% of a country being exceptionally wealthy, 15% being middle class, and 80% struggling to get by, is that a point whereby we can examine whether the basic theory is as good as we thought it was? I’m sure you’d agree that only blind ideologues don’t continue to monitor what is actually happening, and don’t just assume that the system will work no matter what. You’re not a blind ideologue, so at what point would you start to think that we need to consider how to address issues that might lead to serious societal problems? What percentage of the population have to be really strugging before the ‘incentive’ theory should be investigated?

    This is one of your best points in this whole thread. The facts are these, fairness is not really part of capitalism. Joe can do all the right things and be stand up, but if a competitor designs a better product that people want, and unless Joe can adapt, he is out on his ass, along with his family, winners and losers, no getting around that. But that is not the end of the story. Joe, if he is so inclined, can pick himself back up, go back to school, get another job, or do something with himself so that he can compete again, so that maybe he invents the product that will put his competitor out of business.

    The problem with this is that we can always come up with a single example which sounds amazing. But the reality is that the system itself ensures that the majority of people aren’t going to be that example, no matter what they do. And the big problem seems to be that more and more skilled jobs are paying such a low wage that people can’t live comfortably on them. And the trend is heading in the wrong direction on that.

    Have you not read about those small businesses that have gone under or predict going under because of Obamacare? Google Obama’s war on business. You remember 2 years back the tussle he got into with the BBB? Where they complained that his policies were anathema to job creativity and he decided to take it personally and go after them?

    Businesses are always going to fight as hard as possible against regulation and additional cost. Of course they are. However fighting your corner doesn’t necessarily mean that you’re being “stifled at every turn by onerous regulations”. I’d like to see an example of that. I’m afraid it sounds like gross exaggeration to me. How is that even remotely consistent with halving the payroll taxes paid by companies on the first $5 million of taxable wages they pay? But it’s tough to sort through the rhetoric and one-sided analyses on both sides. Where is the neutral objective analysis?

    We’ll just have to agree to disagree on this one. I would think 99.9% of all wage earners feel that they earned that money and would prefer a greater say in how much of that money is taken from them in the form of taxation.

    The pre-tax figure is rather arbitrary. Sure, along with the relevant tax rate, it determines what I actually get in the hand. But nothing to do with my job or my life relates to that pre-tax figure. I don’t get angry and surprised every time I see that I’m not getting that pre-tax figure.
    But in saying that I do want to make sure that the government is using all tax money prudently. I certainly want a say in it.

    Good discussion, and no where did you accuse me of having a little penis or that my mom is so low she plays handball against the curb, curious.

    Now you’re just being a whiney cunt.

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  17. CM says:

    Thatcher was of course right. But that’s hardly surprising. Desire to fix “income inequality” which is a loaded term of course, in modern western countries, is nearly always born from resentment and envy, or simply the desire to gain votes from lower/underclasses. It works quite well. Usually stems from Marxist myths.

    Just to clarify again, the issue I’m interested in is more the continuing increase in income inequality, and what actually means to the socities we live in (how it might manifest itself). Again, Stiglitz sets it out better than I can in the piece I linked to earlier.
    I certainly don’t resent or envy anyone, and certainly not from a financial perspective because I’m doing just fine. I know some others in the same boat, who have no reason to be envious or jealous. The fact that some might do it for those reasons isn’t really relevant to the substance of the discussion.

    And having money you earned or came across by chance, stolen from you, by the government, and dispersed to people like a drug by politicians who get the credit (and increase their power because of the money they have stolen off the rich), is certainly a source of misery.

    I disagree. I can’t find any definition of misery that comes close to that. If that’s misery then the term needs to be redefined. And we need to use another term for what we consider misery now.

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  18. AlexInCT says:

    CM, if I may, may I turn my little post above around a bit to ask you a question? If I had a magic wand I could wave and it would, in a year, raise the incomes of the poorest people and the middle class by 10% but would raise the incomes of the upper 1% by 25% would you be in favor of waiving that wand? Everyone would be wealthier, but the income gap between rich and poor would be greater.

    Your average honest liberal that believes in this income inequality nonsense would tell you to break that wand. If the rich get richer when the poor also get richer in such a way that the gap widens, then what is going on is still wrong. The elite that push this nonsense and their flock would have you believe that they much rather drag everyone down to the level of the poor than allow some to have more than others. Of course, if you understand that what the elite here really want – a mechanism to rob the productive and give themselves power and wealth while producing nothing of value but buying favor with the envious – you understand the answer to their objection. The poor dupes that go along with the envious feeling s these elite stoke in them aren’t much better human beings though, despite what they might believe of themselves. When envy makes you willing to cut off your nose to spite your face, you deserve the misery you will find yourself in. The sad thing is that misery loves company.

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  19. AlexInCT says:

    Just to clarify again, the issue I’m interested in is more the continuing increase in income inequality

    Blame it on the people that are willing to pay ludicrous amounts of money to for example watch an over paid athlete or actor/actress, the top accountant to do their taxes, the top whatever to do whatever, or must have the latest gadget no matter the price. They make it possible for some people to make ludicrous money. Notice I left out politicians and lawyers on purpose because they are just parasitic entities. If nobody would pay the high cash that are needed to then pay for the services of some specialized professionals, nobody would be making that money. CEOs can get millions because their boards and the stockholders they represent deem them worth it. The day that stock holders and boards that control their pay no longer feel they are worth that kind of money, do you think they could still demand they be paid that?

    Similarly, I find it hard to justify being forced by government to pay someone a fixed rate for a job I could pick up any slob off the street to do. The concept of supply & demand works for a reason. When you start tampering with that concept and others like it that from the basis of economic activity, no matter how well intentioned you claim you are and noble your end goal is, you get things like the latest world wide economic collapse we now are in. And pretending the answer is more meddling and regulation by bureaucrats that do nothing of value is just going to make things worse.

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  20. JimK says:

    The rich pay less tax than they ever have, and are richer than they’ve ever been. Once you’re rich, you’ve got it easier than ever before (and it’s easier to keep making money). The issue may be the increasing inability of people to move up to that level. The middle class is shrinking, and this is a multi-decade trend now, which transcends booms and busts.

    Evidence seems to suggest otherwise
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  21. CM says:

    I trust a guy that admits he is out to do well for himself over the guy that tells me he wants to stamp out injustice and help everyone any day of the week. One is being honest and good. The other is a crook that is hiding behind the pretense of wanting to do good to fuck us all over.

    I guess this is one of the stark differences between us. I assume from the outset that people sincerely believe that the political philosophy they favour is the best way to organise society for the betterment of everyone. I don’t assume they favour that philosophy because they hate a certain segment of society. Until they give me a reason not to.

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  22. AlexInCT says:

    The rich pay less tax than they ever have, and are richer than they’ve ever been. Once you’re rich, you’ve got it easier than ever before (and it’s easier to keep making money). The issue may be the increasing inability of people to move up to that level. The middle class is shrinking, and this is a multi-decade trend now, which transcends booms and busts.

    This happens on purpose Jim. The very people telling you they are out to stamp out this injustice are the ones that profit from it the most both financially and in terms of accrued power. It is not by accident that we get more people on government assistance and a worse economy when the marxist run the house.

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  23. AlexInCT says:

    I guess this is one of the stark differences between us. I assume from the outset that people sincerely believe that the political philosophy they favour is the best way to organise society for the betterment of everyone.

    So you are one of the few that actually are true believers? How noble of you! You see good in man despite evidence to the contrary. Or is it your belief that government can regulate man and make him good? Heh, I guess those bible thumpers got it all wrong and all they needed to do is make government control man and make him good. Instincts be damned.

    I want to believe you BTW, CM. But I am too much a student of man and history to do otherwise. I am far more inclined to buy someone telling me that they are religious and believe in a higher power or really believe in Santa Claus or the Tooth Fairy than someone that tells me they actually think anything that evolved out of the bag of shit marxism served us is workable. The these are all far likely to be real than marxism or any of its derivatives producing anything but hell on earth.

    True believers BTW, are the scarier ones IMO, CM. They can justify anything because they truly feel they know what’s best. That whole breaking eggs to make omelets thing comes to mind.

    I don’t assume they favour that philosophy because they hate a certain segment of society. Until they give me a reason not to.

    What about those that favor a philosophy because they can make both money and get power by peddling the nonsense it is based on, despite a century of proof, hundreds of millions dead, billions held prisoner, and in general abysmal failures to the last one (some yet to come), while pretending they are doing it out of noble reasons? You don’t have to hate anyone, just be a callous and calculating asshole. You know, like most people peddling all the nonsense you so fervently believe in actually historically are.

    Mother Theresa was an aberration. A one in a billion thing. People like Stalin and Pol Pot are not. And they always end up in charge of these fairy tale movements. History backs that up.

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  24. CM says:

    Even though there is plenty to respond to (I mean on the topic, not the stuff about Marxism)unfortunately my workload and 5-day camping vacation starting tomorrow (amongst shipping containers apparently) mean I can’t put any more time into this now. I can also see how this is going to go based on the posts just before this one. But thanks to those that contributed thoughtfully. As Rich said, just shows what’s possible……

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  25. sahrab says:

    The rich pay less tax than they ever have, and are richer than they’ve ever been. Once you’re rich, you’ve got it easier than ever before (and it’s easier to keep making money). The issue may be the increasing inability of people to move up to that level. The middle class is shrinking, and this is a multi-decade trend now, which transcends booms and busts. While the top 1 percent have seen their incomes rise 18 percent over the past decade, those in the middle have actually seen their incomes fall. Will that continue? If so, it is a sustainable society that is comprised almost exclusively of people who are either rich or a struggling? Or does that lead to some serious break-down?

    Refute (dont like it go find your own source to refute it)

    Its an oldy but a goody ten people go out for dinner, they all eat the exact same thing from the same menu.

    The bill comes to $500.

    For CM:

    Items from Menu = The goods and services used by and for all (roads, public works, public education, public medical, military, police, fire dept)
    What they ate = Use of these services is equal (its really not, as the Rich typically do not use public services as the same rate as the non-rich, yet as a member of society they are subject to the same tax burden)
    Bill = the tax burden to be paid by all citizens

    In our Tax System:

    One person pays $295 of the bill

    Leaving $205 to be split by the remaining 9 people (so much for equal footing)

    One person pays $100
    One person pays $70
    One person pays $35
    One person pays $15
    One person pays $5
    The remaining four get paid $5 each

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  26. Miguelito says:

    When the government provides for you to the extent that you are comfortable, happy with your lot in life and perfectly willing to continue in your state, then government is doing something wrong.

    All you have to do is see examples of people living completely on the dole in the UK for why this is bad. The people that rioted not too long ago were made up of a lot in this situation. They have no shame about it, and actually complain that they should have even more and that they actually deserve it.

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  27. ilovecress says:

    Use of these services is equal (its really not, as the Rich typically do not use public services as the same rate as the non-rich, yet as a member of society they are subject to the same tax burden)

    I’d refute that simplification – what about defence? The rich (job creators) rely on roads for transporting goods. They rely on their workers a stream of educated workers to add value to their businesses, as well as low income people to be able to do the low income jobs (who may need welfare to actually survive). They have the same need for fire services (perhaps more) and public medical for their workers.

    I’m just saying that it’s a misleading over simplification. If you wanted to spin this form a lefty persepctive, you could frame it from the perspective of how much each person has in their pocket. The rich guy may pay 300 bucks, but he still has enough money to live comfortably, whereas the last 4 guys only came out with $15 in their pockets in the first place.

    which raises the question of why the bill was so high in the first place, but thats a different discussion.

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  28. Seattle Outcast says:

    Thanks for the link Jim – I’d had the gut feeling for years that the whole “income disparity” line was utter bullshit (you had to consider the source, and from there it was easy), but hadn’t found any analysis that showed it.

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  29. richtaylor365 says:

    Raising investment income slightly and reducing personal income tax levels slightly.

    Don’t forget that cap gains and dividend income has already been taxed at the corporate rate (35%), that is why I am in favor of reducing these two tax rates to zero, permanently.

    The rich pay less tax than they ever have, and are richer than they’ve ever been.

    The wealthiest 1 percent of the population earn 19 per­cent of the income but pay 37 percent of the income tax, they pay at the highest level which is 35%. This article has two two graphs, tax rates by income quintile, and taxes paid as a percentage of income, this is the actual taxes paid (tax rate minus deductions). Now if you want to complain that rich people are afforded more loop holes, or ways to shelter income then I’m right with you, let’s stop this nonsense pronto. A flat tax with no deductions allowed that you can file on a post card, sign me up.

    What you’re suggesting is that if everything is set up in favour of the rich, everyone will benefit.

    It’s not set up in favor of the rich, it is set up in favor of those that compete.

    The easier it is for the rich to get and stay rich, the smaller the middle class appears to get.

    Perpetuating the fallacy that the pie is of finite size, it’s not. If there was only so much wealth to be made then immigrants wishing to come to America would say ,”Gee, all those rich people are there already, they have all the pie, there can’t be anything left for us, let’s just stay where we are”. But I submit that the pie is infinite, that just because this many people already made it and became wealthy does not mean that you can’t make it too. Wealth is not just moved around from your pocket to mine, it is created and is multiplied. It is preposterous to think that if rich people get wealthier or if more people become rich, that that will somehow diminish the wealth of the rest of the earners.

    .Considering how many people we need to be working on these jobs at all times, and how important those jobs are to society, it doesn’t make sense to me that these people should be living uncomfortable lives.

    Why are you assuming that the same people will stay working those jobs? Yes, we need people to do them, and a ready (new supply) or unskilled workers are there to take over. The reason you don’t see a 40 something taking your McDonald’s order is because he did that job when he was a kid, but found it unsatisfying because it paid jack, so he bettered his station in life and traded up.

    but it is literally impossible for that to happen to most people

    .

    I disagree. I bet if you polled every single member on this blog we could all regale you with stories about how we started off in minimum wage jobs, anybody still working minimum wage jobs? Minimum wage jobs are supposed to suck, otherwise we would still be doing them.

    How about the loss in real wages associated with skilled jobs?

    And like income inequality, a by product of the system we live by. People get paid what they are worth. If there is a glut in nursing and hospitals get the pick of the litter, wages will go down, supply and demand, you can’t monkey with the system. When a supply of something rises, the demand will lessen. It certainly is not the governments job to regulate salaries within the private sector. You think you are under paid? Make yourself more valuable to your employer.

    Firefighters and schoolteachers are in that list of people struggling

    Really? Is the case in NZ? Because over here both are union jobs, pretty cushy positions, well paid and comes with a pension.

    15% being middle class, and 80% struggling to get by,

    You really think 80% is struggling to get by?

    The reality is that living conditions are better then ever.

    You’re not a blind ideologue, so at what point would you start to think that we need to consider how to address issues that might lead to serious societal problems?

    We should always be thinking about serious societal problems. Even on this blog we address these on a regular basis, such as remove big government from our lives and allow us to pursue our dream, to keep taxation low so that the true job creators and hire people and pay them what they are worth, and to keep our government financial sound and fiscally responsible because only then can it function without passing it’s insolvency to its citizens.

    What percentage of the population have to be really strugging before the ‘incentive’ theory should be investigated?

    Investigated for what purpose? To radically overhaul it to a more socially accommodating system where a living wage is provided for all regardless of qualifications?

    . And the big problem seems to be that more and more skilled jobs are paying such a low wage that people can’t live comfortably on them. And the trend is heading in the wrong direction on that.

    Assuming that is so, what should we do about it? Are you advocating the government getting in and setting salaries? Wouldn’t the answer lie in making yourself more marketable and more valuable to your employer? Or going into fields that are not so populated with competition?

    I understand that you are a capitalist and advocate the free market system, but we take the good with the bad, otherwise we revamp everything and go another route. It’s like complaining about democracy, saying it sucks because good candidates don’t run, ignorant uninformed voters sway elections, most of the politicians are crooks , voter fraud is rampant, and a complicit biased media is left to spread lies and influence elections. OK, all true, but what do you propose to substitute in it’s place?

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  30. Miguelito says:

    I am happy to admit that I think our society’s values on some professions are a bit messed up. I think the fortunes we pay to Hollywood stars and NFL players are crazy, but they are an accurate reflection of how our society values their work.

    I always find it ironic that most people that cry about “income inequality” never seem to have an issue with these people getting huge amounts of money either. Many seem to talk about how it’s ok for them, because they had to work hard to earn it… as if it doesn’t take hard work and a lot of time and energy to build up a fortune in any other way.

    Sure, the spoiled rich kid that’s handed a desk jockey job by dad is something even I have an issue with. But equating all desk jockeys to not earning what they’re paid is just silly.. the vast, VAST, majority of people earning large amounts have skills that others value and they had to work had to build up.

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  31. Kimpost says:

    Assuming that is so, what should we do about it? Are you advocating the government getting in and setting salaries? Wouldn’t the answer lie in making yourself more marketable and more valuable to your employer? Or going into fields that are not so populated with competition?

    I understand that you are a capitalist and advocate the free market system, but we take the good with the bad, otherwise we revamp everything and go another route. It’s like complaining about democracy, saying it sucks because good candidates don’t run, ignorant uninformed voters sway elections, most of the politicians are crooks , voter fraud is rampant, and a complicit biased media is left to spread lies and influence elections. OK, all true, but what do you propose to substitute in it’s place?

    I would suggest a capitalistic system coupled with a societal safety net covering for instance healthcare and education (university level too). Stuff that wouldn’t remove incentives to work hard, but would serve as opportunity (not outcome) equalizers.

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  32. sahrab says:

    I’d refute that simplification – what about defence? The rich (job creators) rely on roads for transporting goods.

    It was a simplification but its still valid and your looking at it incorrectly

    Defense – Paid for by the Rich and Middle Class;Used by rich, middle class and poor; Benefits the rich, middle class and poor
    Roads – Paid for by the Rich and Middle Class;Used by rich, middle class and poor; Benefits the rich, middle class and poor
    Public Eduction – Paid for by the Rich and Middle Class;Used by middle class and poor; Benefits the middle class and poor
    Fire Services – Paid for by the Rich and Middle Class;Used by rich, middle class and poor; Benefits the rich, middle class and poor
    Police Services – Paid for by the Rich and Middle Class;Used by rich, middle class and poor; Benefits the rich, middle class and poor
    Medical Services – Paid for by the Rich and Middle Class;Used by middle class and poor; Benefits the middle class and poor

    This is what i meant, and you know this, by the “rich pay into but dont get the benefit of the services”.

    They rely on their workers a stream of educated workers to add value to their businesses, as well as low income people to be able to do the low income jobs (who may need welfare to actually survive). They have the same need for fire services (perhaps more) and public medical for their workers

    Your roots are showing, the workers have the exact same opurtunities available to them. While there are some blue bloods in this country, the majority of the “Rich” get there through hard work, paying their dues, and working towards creating an oppurtunity for themselves (no matter what CM thinks). There are many real examples of this, CM and others know this, but would rather dwell on millionaire barbie (Paris Hilton) as their example of the “Rich”.

    Those that are not Rich have two choices; emulate whatever practices and methods that were used to become rich themselves or they can bitch about “Fair Share”. One of them will produce results the other wont.

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  33. hist_ed says:

    Firefighters and schoolteachers are in that list of people struggling

    Sorry CM but here in the US that is a load of crap. Despite what my union and its pet politicians say teachers have been doing well in the past few years and decades. There also have been a lot of people hired into education (most into non-teaching positions). I have a colleague who is close to retirement. He earns 85k and boosts that with coaching and summer school (don’t know for sure but probably to 100k) so that will factor in his retirement (2% X years of service X average of two highest paid years= about 65k). No we ain’t rich, but with my public servant wife my household is in the top 20%.

    But yeah, pay me more if you feel guilty.

    Also see here http://tinyurl.com/6vnnpkk

    Note that the chart is comparing average teacher salary with average household income. A big share of those households are two earners.

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  34. hist_ed says:

    Even though there is plenty to respond to (I mean on the topic, not the stuff about Marxism)unfortunately my workload and 5-day camping vacation starting tomorrow

    Please answer my question when you return. Pretty please. With a nice (Marxist) red cherry in top?

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  35. CM says:

    Haven’t gone yet. Was busy at work today. Half a day of work tomorrow and then heading away.
    There was a question there?

    The ‘firefighters and schoolteachers’ thing comes from this quote from the NY Times article I linked to:

    Focusing on the statistical middle class — the middle 20 percent of households, as ranked by income — underlines this point. Households in this group made $35,400 to $52,100 in 2006, the last year for which the Congressional Budget Office has released data. That would describe a household with one full-time worker earning about $17 to $25 an hour. Such hourly pay is typical for firefighters, preschool teachers, computer support specialists, farmers, members of the clergy, mail carriers, secretaries and truck drivers, according to the Bureau of Labor Statistics.

    Taking into account both taxes and tax credits, the average household in this group paid a total income tax rate of just 3 percent. A good number of people, in fact, paid no net income taxes. They are among the alleged free riders.

    You can pick any you like from that list, or go to the Bureau of Labor Statistics and pick any others that suit.

    How can these workers be considered the middle class if their federal income tax liabilities have been reduced to almost zero? Is that not effectively propping up the middle class so that it doesn’t collapse?

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  36. CM says:

    Evidence seems to suggest otherwise

    Kudlow doesn’t make a fully realised justification for moving the end point past 2007.

    Why the discrepancy? For starters, the CBO report covers the period 1979 to 2007. According to the authors, 1979 was the earliest year for which certain Census Bureau data are available. Fair enough. The report also chose 1979 and 2007 as its beginning and end dates because “both were economic peak years just prior to a recession.” But the peaks were by no means equally intense—and the economic downturn of 2008 and 2009 can hardly be characterized as just “a recession.” It started from a much higher level of economic activity, occurred much more rapidly, and involved a much bigger increase in unemployment than did the recession following 1979.

    He takes it through to the end of 2009 instead. Is that a fair point to end it? It could make a large impact to include an additional bust (and of that size) when the entire period is only 30 years. I’d like to see it graphed to see if those last two years make a significant difference. Mostly I see graphs like this:
    http://www.infiniteunknown.net/2009/08/15/study-us-income-inequality-is-at-an-all-time-high/

    Possibly this is one of those cases where the choice of variables greatly determines the outcome?

    But hey, if there hasn’t indeed been such a rise in the inequality of incomes, that’s great. That’s the result I’d certainly prefer. I’d rather be wrong.
    I know a recent NZ study showed that the rise here was the greatest in the OECD. I obviously need to delve into that to see if I can find problems.

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  37. CM says:

    Ah I see the question. Sorry, things were moving too quickly before:

    That’s not the only possibility. If the richest 1%saw the incomes cut by 30% and the poorest 20% saw their incomes cut by 10% then income inequality would have been narrowed. Would that be a good thing?

    My concerns are mainly around
    1. Whether we are slowly but surely heading for a society with more and more people accumulating at (or near) the bottom (i.e. an increasing percentage of people struggling) and then a vast area where the middle class used to be, and then a small group at the top way way up in the clouds, who own most of everything. I can see nothing but problems coming from that. If it’s not happening, and not going to happen, that’s great.
    2. Whether there are too many jobs which don’t pay enough to live on.

    In which case the answer would be, no, that wouldn’t be a good thing, because it would increase concerns about No. 2.

    I don’t care how much rich people earn, so long as there is a sizable middle class (no huge gap), and the people at the bottomand near the bottom are doing jobs that pay enough to be able to survive on without relying on charity. Having federal tax liabilities being reduced to almost zero would ring some alarm bells on that score you’d think.

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  38. AlexInCT says:

    My concerns are mainly around
    1. Whether we are slowly but surely heading for a society with more and more people accumulating at (or near) the bottom (i.e. an increasing percentage of people struggling) and then a vast area where the middle class used to be, and then a small group at the top way way up in the clouds, who own most of everything. I can see nothing but problems coming from that. If it’s not happening, and not going to happen, that’s great.

    The problem is that you assume the reason so many people are heading for the bottom is some injustice, instead of grasping the fact that a philosophical and fundamental change in ethics and beliefs has destroyed the most fundamental building blocks that encouraged people to make the sacrifices now for a better future later in the past – you know, study hard, work hard, and earn it vs. I was born and I am entitled to it – which the rest of your philosophy is based on have wrought. When kids are told competition is bad, hard work is bad, that their self esteem is more important than actually working hard for either their grades or the trophies that now get handed out for just participating, and those that actually exemplify the hard work are denigrated for it, you are going to end up with a whole bunch of losers that believe like you that the system is unjust because they have not been handed higher incomes for just showing up.

    We have had 4 decades of this kind of nonsense and it is now breaking the beats back. But instead of addressing the real underlying and fundamental issue which stem from the damage that the coddling that the liberal nanny state has wrought, people like you prefer to blame it on some kind of injustice. Not only does it serve as a nice and sharp political weapon, but there is a lot of money & power to be had from blaming the problem your ideology caused on those that did not fall for that shit and actually worked hard to get ahead, despite the obstacles put in their way to prevent that, by the leftists.

    You can count on one thing: the more people that claim that like you they want to regulate a better society try to address this perceived injustice, created by their previous meddling in the first place, but now blamed on everything but, the more of it we will get, and the bigger the delta will get between those that have and those that have not. It has become nearly impossible to get rich without being connected or paying off politicians – and one party seems to be the one you really need to buy, and I will leave the guessing up to you – to straddle your competition with insurmountable regulation while giving you a pass in this country. The solution always seems to be to punish success and to make those on the bottom dependant on government, which then demonizes anyone that is successful and unwilling to pay them their Dane geld.

    2. Whether there are too many jobs which don’t pay enough to live on.

    Ergo the turd polishing example I made above that you ignored or dismissed, at work again. That living wage nonsense is marxism 101 and simply unrealizable.Some jobs are simply NEVER going to pay enough to live, because the labor force qualified to do it is so large that the supply will always outstrip demand. Your kind needs to grasp that. The concept of a living wage is insane. You pay someone what their work is worth based on what you can then sell whatever the produce for. You continue to demand that someone qualified to polish turds be paid a living wage despite the fact that what they produce is of zero value.

    Forcing the system to pay everyone a living wage will collapse it. When you have to pay the guy working at McDonalds a living wage, that means the sales at that McDonalds need to be enough to afford that. In order to do that your $ 0.99 cheeseburger now has to sell for $5.99. As the cost of all products inflate to accommodate the living wage, everyone’s income will deflate because of this inflation. You can keep the cycle going. What you end up with is Zimbabwe. Of course, you will ignore that, because this whole thing is unjust to you and you are damned if you are going to let the basic laws of economics prevent you from organizing Utopia. Push it further and you end up with Cuba or North Korea.

    But hey, you are doing it for a noble reason….

    I don’t care how much rich people earn, so long as there is a sizable middle class (no huge gap), and the people at the bottomand near the bottom are doing jobs that pay enough to be able to survive on without relying on charity. Having federal tax liabilities being reduced to almost zero would ring some alarm bells on that score you’d think.

    End most of the bullshit regulations and confiscatory policies the left instituted over the last 5 decades and roll back all the nonsense leftists believe in and have straddled us with, and your middle class will come right back.

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  39. hohokiss says:

    Cause and effect. The reason folks lean away from the right is because the right are too often plain old dishonest and selfish, and they like to flaunt it, cuz thems the rules. And despite all their flag-waving, theres no loyalty to anything but personal gain.

    I read that Detroit is still/again/whatever going bankrupt, and, of course, its the unions wanting all that money thats supposedly alone to blame, forcing the hard-working businesses out of town. Nevermind what made them unions necessary in the first place long ago – greed, racism and injustice.
    Discrimination is again a handy tool to trot out in this election year. Meanwhile Detroit schools will close anon and garbage trucks will stay at the shop, and yet another generation will grow up in filth and squalor, feeling like victims. but its the principle of the thing – unions just too greedy.
    Michigan’s governor is Republican Rick Snyder, how did that happen with the unions choke hold on everything?

    Detroit automakers are back on their feet, showing their best profits in years. But the city of Detroit’s finances are worse than ever. Detroit has significant legacy costs. It has twice as many retirees as active employees. For police and fire, it’s three times as many retirees

    The simple solution, certain folks maintain, is to “let ‘em learn to work, again, to earn an honest days wage”. Pah. Let em fix it themselves, those selfish…..

    Mayor Dave Bing says there are no quick fixes for Detroit’s financial crisis, but the city is moving quickly on a long-term solution that will include significant union concessions.
    “For the first time since I’ve been in office, unions are sitting at the table with an open mind,” Bing said

    Yeah, we beat ‘em! Thats all we needed to hear. Good luck and goodbye

    Last 4 decades, last 5 decades

    ? Righties were in charge for most of that time. Dem JFK was shot in ’63, so LBJ finished his business. Republican Ford finished Nixon’s fixings by ’77, Dem Carter sucked up to foreigners too much, so it was back to Republicans Reagan and then Bush, who sucked enough for folks to elect Dem Clinton, who undid everything good in 8 years that the right had accomplished in the previous 12, I’m supposed to believe.
    Bush Jr. screwed things up so badly in his 8 years the nation went looking for a handout from Obama. Cause and effect.

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  40. hist_ed says:

    Ahhh, CM you still missed it (I admit that you answered a previous question. Here is the question I was interested in hearing your answer to:

    CM, if I may, may I turn my little post above around a bit to ask you a question? If I had a magic wand I could wave and it would, in a year, raise the incomes of the poorest people and the middle class by 10% but would raise the incomes of the upper 1% by 25% would you be in favor of waiving that wand? Everyone would be wealthier, but the income gap between rich and poor would be greater.

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  41. hist_ed says:

    Nevermind what made them unions necessary in the first place long ago – greed, racism and injustice.

    If you look at union history, most were, during their formative years, very racist. The current crop of progressives wish to white wash it, but the original progressive movement was shot through with racists.

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  42. hohokiss says:

    I’ll agree with that 100%

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  43. hist_ed says:

    I’ll add regarding income statistics generally that there are several problems with them:

    Many whine about the middle class not getting ahead in the last few decades. The most common numbers used for this are household income stats. Over the last few decades households have gotten smaller (more kids tend to move out at a younger age than 30 years ago, more divorces, etc.) so the average income per person-and the average income per worker-has increased a lot more than the average household income.

    Other look at income disparities and seem to assume that there is no income mobility. They are the same people over time. If you compare the top 20 percent with the bottom 20 percent one thing leaps out at you: age. About half the bottom 20 percent are young-in their teens and twenties. Of course they are not earning a lot. Many of those are students. The vast majority of people who are in law school or medical school are in the bottom 20%. Should we really worry about their long term income potential (yes, under Obamacare, maybe we should for the doctors, but the lawyers increase will balance that out, right?). Even those that don’t go to school have to start somewhere. When you are 18 or 19 and have a high school diploma and no work experience, what sort of jobs do you get? If you are smart, you pick a job with potential. My wife’s first job was at a busser in a crappy Denny’s style greasy spoon making minimum wage. She worked her ass off and was waiting tables in the same place within 6 months. She took that experience and applied to better places and within a few years was working a high end seafood place getting tipped a couple of hundred or more a shift. I had the same course in retail out of high school-going from minimum wage cashier to manager in 5 years (alas in a record store chain that went away). Back in the mid 1990s we were squarely in the bottom 10% because we were students. We got out degrees (2 each) and now are in the top 20%.

    Roughly the other half of the bottom 20% are locked in a cycle of intergenerational poverty: The ghetto underclass. If you at them, they don’t work much and get the majority of the income from government benefits (which in many data sets aren’t even counted as income). They are a real problem, but throwing government cash at them obviously doesn’t work. We have done so for decades and it has only made things worse.

    Of course you can reverse the attributes of the bottom 20% to get most of the top 20%. Most of them are old. They also work a lot. Again, my household is in the top 20%. I am a teacher married to a prosecutor (both early 40s). Between us we have inherited nothing. We worked our asses off through school and worked our asses off afterwards. We got degrees that would get us jobs instead of studying Tibetan feminist yak butter literature.

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  44. CM says:

    CM, if I may, may I turn my little post above around a bit to ask you a question? If I had a magic wand I could wave and it would, in a year, raise the incomes of the poorest people and the middle class by 10% but would raise the incomes of the upper 1% by 25% would you be in favor of waiving that wand? Everyone would be wealthier, but the income gap between rich and poor would be greater.

    I wouldn’t have a problem with that. The gap isn’t as relevant (perhaps not relevant at all) if the people at, or near, the bottom can earn enough to not stress the whole time about how they’re going to pay for basics. There will still be the incentive to become rich.

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  45. Kimpost says:

    CM, if I may, may I turn my little post above around a bit to ask you a question? If I had a magic wand I could wave and it would, in a year, raise the incomes of the poorest people and the middle class by 10% but would raise the incomes of the upper 1% by 25% would you be in favor of waiving that wand? Everyone would be wealthier, but the income gap between rich and poor would be greater.

    It being a magic wand at all, I probably wouldn’t have a problem with it either. In the real world though, I would like to have a look at the following hyper inflation, before fully enjoying your works.

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  46. balthazar says:

    Is this you CM?

    Olympics

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  47. sahrab says:

    I wouldn’t have a problem with that. The gap isn’t as relevant (perhaps not relevant at all) if the people at, or near, the bottom can earn enough to not stress the whole time about how they’re going to pay for basics. There will still be the incentive to become rich.

    you do realize at that point you’ve done nothing but shift the scale? This is the same fallacy as raising minimum wage.

    In order to increase the income of the bottome end/minimum wage it is going to cost businesses more to operate (higher wages comes out of operations)

    Time for you to be honest, do you expect businesses to eat those increased operations costs? If your realistic, you know that the businesses will pass those costs onto the consumers.

    Some of those consumers will include the bottom end/minimum wage earners you just increased wages onto.

    This is a simplificaiton, but it is valid and backed up by accurate historical evidence.

    Raise minimum wages $0.25. It now costs companies $0.25 more per hour per employee. At some pont there is a threshold of what the company can bear. Either they eliminate the employee that just recieved the $0.25 raise, or the business passes the cost onto the consumer.

    Since labor costs make up half of the cost of doing business (you’ll love the source), then the customers of those firms using low-wage labor will end up paying more to get the same things. Thanks for that extra quarter.

    Your sliding scale is no different, slide the right end of the scale anywhere and you have effected the prices for, leisure, restaurants, hotels, and retail. this effectively eliminates any gain from adjusting the scale (or minimum wages)

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  48. sahrab says:

    I don’t think taxing investments (which is how the really rich, like Romney, earn ‘income’ – their money earns money, rather than their labour earning money) at something closer to income tax (e.g. move it from 15% to 18%) is going to result in misery. Or bring down capitalism. If some average Joe is working 50 hours a week and paying 30% income tax, why should he not be annoyed that people who are already really rich are entitled to pay a lower rate,

    In order to make your point you are comparing two seperate items and attempting to equate them.

    Because if you were a smidgen honest, you would admit that both “Average Joe” and Romney all have an equal oppurtunity to only pay 15% one type of income and 30% for another type of income.

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  49. CM says:

    The wealthiest 1 percent of the population earn 19 per­cent of the income but pay 37 percent of the income tax, they pay at the highest level which is 35%. This article has two two graphs, tax rates by income quintile, and taxes paid as a percentage of income, this is the actual taxes paid (tax rate minus deductions). Now if you want to complain that rich people are afforded more loop holes, or ways to shelter income then I’m right with you, let’s stop this nonsense pronto.

    I’d like to see that graph alongiside a graph of what actually happens. E.g. Romney’s self-confessed 15% suggests the graph at your link is just theory. It says what people SHOULD be paying. But if most of the wealthy earn through capital gains (etc) then it’s simply misleading.

    http://www.csmonitor.com/USA/Elections/President/2012/0119/Unlocking-the-mystery-of-Romney-s-15-percent-tax-rate.-Yes-it-s-legal

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  50. CM says:

    Why are you assuming that the same people will stay working those jobs? Yes, we need people to do them, and a ready (new supply) or unskilled workers are there to take over. The reason you don’t see a 40 something taking your McDonald’s order is because he did that job when he was a kid, but found it unsatisfying because it paid jack, so he bettered his station in life and traded up.

    The problem is that many of these aren’t entry-level jobs. Look at those examples provided in the NY Times quote, taken from the Bureau of Labor Statistics. It’s not burger-flippers. It’s “firefighters, preschool teachers, computer support specialists, farmers, members of the clergy, mail carriers, secretaries and truck drivers“. These are now all jobs that pay so low that they hardly have to pay federal income tax. Does that sound right to you?
    We have a similar problem here.

    And like income inequality, a by product of the system we live by. People get paid what they are worth. If there is a glut in nursing and hospitals get the pick of the litter, wages will go down, supply and demand, you can’t monkey with the system. When a supply of something rises, the demand will lessen. It certainly is not the governments job to regulate salaries within the private sector. You think you are under paid? Make yourself more valuable to your employer.

    I’m not sure how that can explain it. There’s a glut in that entire list of jobs? It’s not that the wages have gone down, they just don’t seem to have gone up. I totally agree that individuals should make themselves valuable in an attempt to earn more, but the problem seems to be much more systemic. Individual actions can’t do anything about systemic problems.

    Are you advocating the government getting in and setting salaries?

    Not at all.

    I understand that you are a capitalist and advocate the free market system, but we take the good with the bad, otherwise we revamp everything and go another route.

    No, it doesn’t have to be a case of one extreme or the other. I don’t believe we need to throw the baby out with the bathwater.

    It’s like complaining about democracy, saying it sucks because good candidates don’t run, ignorant uninformed voters sway elections, most of the politicians are crooks , voter fraud is rampant, and a complicit biased media is left to spread lies and influence elections. OK, all true, but what do you propose to substitute in it’s place?

    I’m not looking to replace it, just exploring and considering the effects of the current situation.

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  51. hohokiss says:

    In Germany apprenticeship programs are all but mandatory for virtually all blue and many white collar jobs, and without a journeymans certificate nobody has to pay you anything but a helpers wage, ever, no matter how hard you work, or yer claiming “30 years experience” Each profession has its own minimum wage, unions, benefits, etc 20 plus days vacation. Free health care.

    The idea is for school graduates to receive verifiable, proper and equal training anywhere in the country. It takes 3 years for the electrician to learn his trade, just as long as it takes the store decorator to learn hers, not just from watching a 60-minute how-to video from DeVry. The journeymans cert shows you know the basics, for sure, have a certain level of stamina and dedication.
    Can’t open your own business without a master’s cert, which can be attained after 3 years working as a journeyman in your chosen trade, and another full year in masters school. All this makes for higher wages in the field, not just what the market dictates.
    If you decide you want to be a plumber instead of a hairdresser, guess what, its another 3 long years under most circumstances. Unless you become allergic to hairspray, then the govt helps pay for re-education. After all, its not your fault.

    The standard of quality is oft vastly superior to that seen in other, far freer countries, which makes the properly trained German scoff and laugh. “No wonder its all so cheap, its garbage. ”

    I changed my profession here in the States w/o any formal training whatsoever, just a free 3-week course, and was soon earning more than when I was working much harder physically, getting far dirtier. Bought me some health care, stocks, a house, car, decent tools, etc. studied everything I could, was available 24/7. It was a magical time. My wife didn’t have to work as a high school teacher anymore; she severely disliked the “systems” bureaucracy.
    The Bush boom went bust, everythings gone, nobody cares about them old “30 years experience”, now employers want to see some kind of certs and stuff. Working at McDonalds etc. to try and stay afloat doesn’t look too hot on the resume and it doesn’t pay the bills. And, true, throwing govt money at things doesn’t help. So 40-somethings get to move back in with their parents, because they saved their cash and worked hard, and now get that govt pension. Hard to say what might happen if any one of them got seriously ill, tho.
    And educators, they want to see hard cash for their 60-minute videos guaranteed to get you that 30-minute online degree. So you gotta go out and peddle your talents, hope to get some gig.

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  52. CM says:

    the majority of the “Rich” get there through hard work, paying their dues, and working towards creating an oppurtunity for themselves (no matter what CM thinks).

    Where did I suggest they didn’t?
    Try sticking to the actual discussion rather than pretending it’s another one. Otherwise you’ll be no different to some other posters.

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  53. hohokiss says:

    Oh, I might add that the exact same job at the same business where I lived that offered $10/hr in 1992 offers $8.25 in 2012

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  54. CM says:

    Alex:

    Of course, you will ignore that,

    I’m only addressing comments that are relevant to what I’m saying. Almost everything you’ve posted in this thread misses the point and is therefore irrelevant.

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  55. CM says:

    Is this you CM?

    Olympics

    ;-)
    Nah, that’s the other guy that lives here.

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  56. CM says:

    You do realize at that point you’ve done nothing but shift the scale? This is the same fallacy as raising minimum wage

    etc

    It was a magic wand, so I assumed none of that would need to happen. I assume he was teasing out whether I actually do have a problem with the richest being even richer. I don’t. As explained. Many times.

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  57. AlexInCT says:

    I’m only addressing comments that are relevant to what I’m saying. Almost everything you’ve posted in this thread misses the point and is therefore irrelevant.

    No CM, what I have said basically exposes the fundamental flaw with your way of thinking, and since you don’t like that, you ignore it. That you desperately continue to pretend that what you believe makes any kind of sense and hence feel what I am saying should be irrelevant does not change the fact that nobody can ever regulate these things you want with even the slightest modicum of positive success. The actions taken in the name of this “social justice” to address “income inequality”, definite buzz words with marxist roots despite your attempts to pretend otherwise, by those ascribing to your ideology exacerbated these very problems it portends to be trying to address. That happens because as usual true believers like you ignore reality and the consequences of their idiotic regulations, thinking meaning well is enough to make a difference.

    But you can keep pretending otherwise and even keep saying what I am pointing out is irrelevant all you want. The facts and the damage the policies and nonsense you believe in have caused speak volumes to the contrary. The concept of a living wage is not just stupid, it is an economic fairy tail bound to produce nothing but more harm to the very people it portends to try and help. So are any attempts to address “income inequality” or to institute “social justice”. And I say that with conviction, because all you need to do is look at the damage caused by the very policies that have so far been implemented to deal with them. Of course people like you will blame everything and everyone but the real culprits. And that is why we will always have more inequality and less justice.

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  58. CM says:

    Because if you were a smidgen honest, you would admit that both “Average Joe” and Romney all have an equal oppurtunity to only pay 15% one type of income and 30% for another type of income.

    If Average Joe is struggling to pay the bills and spends 98% of his income each fortnight, how is he able to pay 15% tax?
    It’s like our current centre-right government before the election last year telling us that selling national assets (which make huge annual profits) is a great thing because Mum’s and Dad’s will be able to buy the shares. Yeah, um what windfall is going to arrive to enable them to buy shares (in companies they formerly owned)? Do they just go to a food bank for 6 months, in order to buy back something that was sold without their permission?

    If you’re going to start calling me dishonest then we can just leave the discussion here thanks.

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  59. CM says:

    But you can keep pretending otherwise and even keep saying what I am pointing out is irrelevant all you want.

    Thanks. I will. Mostly I’ll just ignore it. So long as there are others that are interested, it doesn’t matter whatsoever.

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  60. sahrab says:

    Nice edit, but it was obvious. You are being dishonest, by harping on Romney’s 15% and you know it.

    You try to cloud the subject by calling both Income taxes, but they arent equal. You know this.

    Romney is not paying payroll taxes, he is paying investment taxes. When/If Average Joe makes his income from Investments he’ll be subjected to the same 15% tax that Romney is.

    Average Joe is not paying investment taxes, he is paying payroll taxes. When/If Romney gets paid a salary he’ll be subjected to the same 30% tax that Average Joe is.

    Maybe you dont know what your arguing for or about, becuase in America your “equality” goal is in effect, both are paying equal and both are subjected to equal tax burdens.

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  61. sahrab says:

    Where did I suggest they didn’t?
    Try sticking to the actual discussion rather than pretending it’s another one. Otherwise you’ll be no different to some other posters.

    Integrity time are you claiming you’ve never used Paris Hilton as an example of how the Rich earn their incomes?

    i really wish there was an advanced search on here.

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  62. AlexInCT says:

    Thanks. I will. Mostly I’ll just ignore it. So long as there are others that are interested, it doesn’t matter whatsoever.

    The funny part is that others are telling you exactly what I do and you feel compelled to ignore, and you ignore that from them too it seems. Case in point hist_ed and sarahb explaining that you can not implement a minimum wage or living wage without companies having to pass the extra cost to consumers and/or trim staff. You still seem to remain immune to the fact that someone has to pay for this and that it then basically results in a cycle that just drives up costs and lowers standards and opportunity for the very people you portend to care about.

    Hey, no skin off my back. I am used to your stupidity and renitence when someone challenges your liberal dogma and lays bare its failures. It is fun to watch others having to wrangle with it too. Sooner than later they will learn as well that you are not going to care what the facts bear out, you believe and your faith in marx’s teachings is strong.

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  63. CM says:

    If those with more money are able to pay tax via a different and lower method, then of course they will, and the income tax graphs become largely meaningless. How is that dishonest?

    But if this is going the usual route, let’s just end the discussion.

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  64. CM says:

    Integrity time are you claiming you’ve never used Paris Hilton as an example of how the Rich earn their incomes?

    i really wish there was an advanced search on here.

    Nope, never.
    Good example of how difficult it is to have a discussion though, if that’s what’s in your head. Perception = reality.

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  65. sahrab says:

    If Average Joe is struggling to pay the bills and spends 98% of his income each fortnight, how is he able to pay 15% tax?

    Why does Average Joe get a 28% tax break thats not afforded to Average Steve who has to pay the full 30%?

    Why do you support shifting the tax burden onto the middle class (average steve) when both Average Joe and Average Steve use the same societal menu items equally?

    Sounds like Average Joe, Average Steve and Romney would all benefit from a flat tax that spreads teh burden out equally, instead of punitivaly as it is now.

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  66. CM says:

    case in point hist_ed and sarahb explaining that you can not implement a minimum wage or living wage without companies having to pass the extra cost to consumers and/or trim staff.

    I did address it. A magic wand was used, so the assumption must be that those laws don’t take effect. Otherwise it would have been a pointless question (and you should be blaming the person who asked it for the lack of understanding).

    You still seem to remain immune to the fact

    So here we are again. You get something wrong and immediately it’s my fault. Same old same old. Which is why you’re hardly worth responding to. If it’s not generic crap about Marxism which bears no relationship to the discussion, it’s getting something wrong.
    From now on I’ll respond to the stuff that warrants it. I’ll take a lesson from how Hal treats you.

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  67. CM says:

    Why does Average Joe get a 28% tax break thats not afforded to Average Steve who has to pay the full 30%?

    I don’t know. Need more information. What are the differences between Steve and Joe? What is it that gives Joe the 28% tax break, and why does Steve have to pay the whole 30%?

    Why do you support shifting the tax burden onto the middle class (average steve) when both Average Joe and Average Steve use the same societal menu items equally?

    I think you misunderstood me. I’m not stamping my feet and saying that middle NY Times 20% need to start paying taxes. I’m saying that there seems something fundamentally wrong when decent jobs (being done by those 20%) earn people so little that they’re deemed to be poor enough to pay little or no federal income tax. On the surface, it would appear that successive governments have tried to put a sticking plaster on a problem. The problem being that there are a whole lot of decent skilled jobs pay little (and when I say little I mean in terms of the basic costs of living).

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  68. CM says:

    Since labor costs make up half of the cost of doing business (you’ll love the source), then the customers of those firms using low-wage labor will end up paying more to get the same things.

    It was an interesting piece you linked to.

    With the economy beginning to slow, the current expansion has a chance to become the first sustained period of economic growth since World War II that fails to offer a prolonged increase in real wages for most workers.

    (The article is from Aug 2006)

    The median hourly wage for American workers has declined 2 percent since 2003, after factoring in inflation. The drop has been especially notable, economists say, because productivity — the amount that an average worker produces in an hour and the basic wellspring of a nation’s living standards — has risen steadily over the same period.

    So three boom years (so boomy that they lead to a catasphroic bust) and yet the median hourly (real) wage went down? And yet “corporate profits have climbed to their highest share since the 1960’s”. What was stopping the workers getting the rewards? The most obvious answer is that the people at the top decided, for once, to keep it for themselves.

    At the very top of the income spectrum, many workers have continued to receive raises that outpace inflation, and the gains have been large enough to keep average income and consumer spending rising.

    I thought that if labour market conditions were tight, as they general are in boom times, then profits would need to be put back into employing people at a higher wage?

    the buying power of the minimum wage is at a 50-year low.

    Perhaps this is it:

    And health care is far more expensive than it was a decade ago, causing companies to spend more on benefits at the expense of wages.

    In the first quarter of 2006, wages and salaries represented 45 percent of gross domestic product, down from almost 50 percent in the first quarter of 2001 and a record 53.6 percent in the first quarter of 1970, according to the Commerce Department. Each percentage point now equals about $132 billion.

    So companies spend less on wages. Which means the government needs to make tax concessions to keep people above water. Which means less federal revenue.

    In another recent report on the boom in profits, economists at Goldman Sachs wrote, “The most important contributor to higher profit margins over the past five years has been a decline in labor’s share of national income.”

    “If I had to sum it up,” said Jared Bernstein, a senior economist at the institute, “it comes down to bargaining power and the lack of ability of many in the work force to claim their fair share of growth.”

    So the unions weren’t doing their jobs properly?

    Average family income, adjusted for inflation, has continued to advance at a good clip, a fact Mr. Bush has cited when speaking about the economy. But these gains are a result mainly of increases at the top of the income spectrum that pull up the overall numbers.

    Damn statistics.

    “There are two economies out there,” Mr. Cook, the political analyst, said. “One has been just white hot, going great guns. Those are the people who have benefited from globalization, technology, greater productivity and higher corporate earnings.

    “And then there’s the working stiffs,’’ he added, “who just don’t feel like they’re getting ahead despite the fact that they’re working very hard. And there are a lot more people in that group than the other group.”

    But in a sign that Republicans may be growing concerned about the public’s mood, the new Treasury secretary, Henry M. Paulson Jr., adopted a somewhat different tone from Mr. Bush in his first major speech, delivered early this month.

    “Many aren’t seeing significant increases in their take-home pay,” Mr. Paulson said. “Their increases in wages are being eaten up by high energy prices and rising health care costs, among others.”

    At the same time, he said that the Bush administration was not responsible for the situation, pointing out that inequality had been increasing for many years. “It is neither fair nor useful,” Mr. Paulson said, “to blame any political party.”

    This is what Stiglitz says – those on the right should also be concerned, because ultimately it doesn’t benefit them because they still need to live on the same planet.

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  69. hohokiss says:

    Heres a success story made in USA:

    According to Kodak, George Eastman, a high-school dropout from upstate New York, founded the company in 1880 and began making photographic plates. To get his business going, he splurged on a second-hand engine to make the plates for $125.

    Within eight years, the Kodak name had been trademarked, and the company had introduced the hand-held camera as well as roll-up film, where it became the dominant producer.

    So Eastman worked hard and such. Today:

    Eastman Kodak Co, the photography icon that invented the hand-held camera, has filed for bankruptcy protection and plans to shrink significantly, capping a prolonged plunge for one of America’s best-known companies.
    According to papers filed with the U.S. bankruptcy court in Manhattan, Kodak had about $5.1 billion of assets and $6.75 billion of liabilities at the end of September.
    The company’s downfall has also hit its Rust Belt hometown of Rochester, New York, with its workforce there falling to about 7,000 from more than 60,000 in Kodak’s heyday.

    Andrew Cuomo, New York’s governor, on Thursday called the bankruptcy “difficult and disappointing news” for the city, whose population was about 211,000 in the last census.

    Screw it, sink or swim, pals.Time change. Leave everything behind and move on. Bonuses to the execs for this stradegy.

    Kodak has struggled to meet its pension and other obligations to more than 65,000 workers, retirees and others who participate in its employee benefit programs. It remained unclear how Kodak will address its pension obligations, many of which were built up decades ago when U.S. manufacturers offered more generous retirement and medical benefits..

    Screw them, too, sink or swim.

    Was this avoidable? And how? Who cares?

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  70. sahrab says:

    I’m sure it has nothing to do with Kodaks delay in embracing the Digital format and Fuji’s filling the void

    nah

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  71. Xetrov says:

    Screw it, sink or swim, pals.Time change. Leave everything behind and move on. Bonuses to the execs for this stradegy.

    You really are a tool. Kodak was crushed due to Union contracts, overwhelming pension contracts, unfair trade practices from China, and crappy businesses decisions. I suppose you think they should get a stimulus check.

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  72. richtaylor365 says:

    Poor Kodak, no “Too Big To Fail” for them, and no tax payer funded bail out money forthcoming, shoulda changed their name to Bank of Kodak, or even General Kodak Motors.

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  73. balthazar says:

    Wow this crap again?

    Romney pays a 15% tax RATE. That RATE is more than 97% of Americans.

    People making 200K or so or less pay a 10% rate OR LESS.

    http://www.cbo.gov/doc.cfm?index=5746&type=0&sequence=1

    Theres a few tables in there that will help you. So YES Romney pays a whole hell of a lot more of a % of his income to the government than the VAST majority of americans.

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  74. sahrab says:
    Since labor costs make up half of the cost of doing business (you’ll love the source), then the customers of those firms using low-wage labor will end up paying more to get the same things.

    It was an interesting piece you linked to.

    Thank you for agreeing, labor makes up half of the cost of doing business.

    Now here will be your defining moment; you do understand that any shift to the cost of doing said business (in the context of this conversation, increasing the costs for labor) will be shifted to the consumer? This increase, in consumer costs, will eliminate any nominal change by raising income levels.

    The question i have, what is the goal? Increasing the cost for businesses to function, or increasing the costs to the consumer to purchase goods? Because your “Solution” will cause both.

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  75. AlexInCT says:

    If those with more money are able to pay tax via a different and lower method, then of course they will, and the income tax graphs become largely meaningless. How is that dishonest?

    Do you need more proof that CM is an economic illiterate or simply dishonest? How hard is it to understand that we have one scaled tax rate for income ranging from the government gives you other people’s money to 33% – the more INCOME you make over the threshold that results in no obligation or even wealth transfer, the higher the bracket and thus tax amount you pay – and another, a fixed one of 15% that applies to everyone, usually on money that already was taxed as income, for investments? Why is it so hard to understand that the two are NOT the same and should NOT be equated: ever. The only reason I can see for this false equivocation is when the objective is to engender envy or promote stupid class warfare I should.

    Romney paid the 15% he needs to on his investment. I paid the same on mine. I also paid 33% on my income. He did the same. Why is he evil or getting an unfair advantage because the investments he pays 15% on happen to be on tens of millions of dollars he earned, and definitely already paid both income or investment tax on and chooses to reinvest, to our economic advantage, and his income is so low that the income tax potion he pays is dwarfed by that? He is paying what the law requires him to.

    Is the argument by the class warriors that it is unfair to have a lower rate on investments than income and that investment income should also be taxed at the same, or even higher rates, than income because it disproportionately favors people with large chunks of cash already? Taxes on investment are practically always going to be the same or lower than the income tax for most people investing, on purpose, because even the collectivists know, despite pretending otherwise when engaging in their class warfare rhetoric, that a lower investment tax encourages investments, which grows economies. If you want to discourage investment and economic growth go ahead and jack up the rate. Of course, don’t come crying when rich people take their money and put it away.

    Like I said: your average doo-gooder, marxist ideology based nonsense believing, nanny-stater lacks comprehension of economic reality, and being hell bent to engineer a system that will force the insane notion of equality they believe the current system doesn’t provide, will guarantee us all a system where we all end up miserable and poor. Call this obvious revelation about the fallacy of the whole “income inequality” and “social justice” that I reiterate, yet again, irrelevant and ignore it all you want CM, but the truth is that the harshest damage to the middle class, and even the poor, is coming from those that legislate pretending to care about inequality and injustice. Deny the producers the rewards of their work to please and appease the lazy envious, and we all suffer. And realizing this obvious fact is the reason I stopped being a liberal at 13.

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  76. AlexInCT says:

    The question i have, what is the goal? Increasing the cost for businesses to function, or increasing the costs to the consumer to purchase goods? Because your “Solution” will cause both.

    There is also a third effect he ignores or doesn’t want to acknowledge at all sarahb: whatever increase to produce the living wage that was added by the “income inequality/social justice” police, will evaporate, almost immediately, as the inflation this increased cost to do business produces, results in the living wage those that where lucky to keep their job got, suddenly becoming insufficient to live on anyway. It’s a circular effect that will jack up everything and solve nothing.

    And the belief that it actually does make a positive difference comes right out of the marxist nonsense my turd polishing example highlights that the real value is labor, and then, in a vacuum, as if the end product’s cost to the manufacturer and the consumer’s willingness to bear said cost for the end product, never matters. But hey, CM says what I am saying is irrelevant… Color me unsurprised, since people that believe like he does simply can not dispute that reality.

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  77. AlexInCT says:

    So three boom years (so boomy that they lead to a catasphroic bust) and yet the median hourly (real) wage went down?

    Did you just blame the bust of 2009 caused by 4 decades of liberal social engineering on the three preceding years of economic boom caused by tax cuts, CM? Really? Tax cuts is what caused lenders to go out and give loans to people they knew couldn’t pay them back then engineer a system, before the tax breaks even went into law of all things, that resulted in the house of cards that came tumbling down? Fuck you liberals are stupid or think the rest of us must be dumber than rocks and unable to see you bullshitting us.

    And yet “corporate profits have climbed to their highest share since the 1960’s”.

    Why is this a bad thing? My 401K investments where growing drastically because of those profits. Now they are no longer doing so, and if people like you get their way, I will be forced to depend on government or work until the day I die (likely both anyway) for this. Let me tell you why corporate profits are bad: because marxists believe everyone should be equally poor.

    What was stopping the workers getting the rewards?

    More marxist nonsense! Again we see another example of logic driven by the idiotic notion that labor is the only thing of value: not the capital, the product, and the ability to sell it at a price that pays for the system to stay in business.

    Was this reward you speak of part of the contract agreement when they where hired? They where employed and paid for the work they delivered right? Your contention that companies need to distribute their profits to their employees instead of the people buying their stock in the absence of an agreement that tells them their profits should also be shared with their employees, tells volumes about your lack of understanding about economics. Real economics: not the pseudo-marxist bullshit that passes for economic literacy on the left. Unless the employees where co-owners and/or had a contract stipulating this sharing there is no sharing. That’s the real world.

    Do you for a second think that a company that was underpaying their employees when making profits, in a growing economy, could retain them when competitors could just hire them away by paying them what their labor was worth?

    The problem is that as a typical leftist you think a company’s purpose is to be like a non-profit or like government: a make work entity for those employed there. Whether they produce anything of value or not, operate within their income capability, or disregard their obligations to those paying for them to exist doesn’t matter a bit as long as they seem to do what qualifies in your typical leftist’s idiotic delusion of justice. That’s marxism 101 right there.

    The most obvious answer is that the people at the top decided, for once, to keep it for themselves.

    Finally we get some honesty! You think the people at the top STOLE it from the others that deserved it more. That the money went primarily to the stock holders of these companies doesn’t register because in your marxist mind companies should exist to provide to workers, not the investors. Now we are finally getting somewhere! Despite all your assurances to the contrary, it is plain and simple marxist envy and class warfare rhetoric that drives people that feel & believe like you, to demand this “injustice” you precieve, be addressed. And your remedy is to straddle us all with regulation that’s more akin to poison and has made things worse.

    Crap, why not come clean and demand the incnome of those at the top be capped and that everyone (except yourself of course, because marxist always feel what they do is far more improtant than what others do) get paid the same regardless of what they do like a good marxist would? This whole kabuke dance about how we should tax them more, in the name of justice, is just that anwyay. Oh, how I love to be irrelvant but right.

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  78. richtaylor365 says:

    Do you need more proof that CM is an economic illiterate or simply dishonest?

    Knowing how fastidious CM is in following this blog, he will probably catch up once he gets back from vacation but’s its probably best to hammer him when he gets back so he can defend himself.

    we have one scaled tax rate for income ranging from the government gives you other people’s money to 33%

    The highest rate now is 35%, not 33%, and if Obama gets his way, that will go up to 39.6%

    Is the argument by the class warriors that it is unfair to have a lower rate on investments than income and that investment income should also be taxed at the same, or even higher rates, than income because it disproportionately favors people with large chunks of cash already?

    Yes, for many, the perception being that only rich fat cats can afford to even have investment income. As I tried to point out to CM, many middle and lower middle class retirees have investment income and rely on those dividends (how meager that they are) to supplement their even more meager SS checks.

    The dividend argument, why it should be less then ordinary income, is easy as pie since that tax is a second tier tax. Every dollar that goes to dividends was already taxed once at the corporate rate of 35%, simple.

    The cap gain argument is a bit hard to square. I have no problem with short term Cap Gains taxed as ordinary income, but they have kept long term gains as the dividend rate. This money, cap gains, has not been taxed already (buying AT&T at 10 bucks a share and selling it at 15 netted me a 50% profit), me being taxed only 15% on that money seems low to me, I’m not complaining mind you but it goes against the grain of a progressive tax system on income earned the first go around.

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  79. hohokiss says:

    You really are a tool. Kodak was crushed due to Union contracts, overwhelming pension contracts, unfair trade practices from China, and crappy businesses decisions. I suppose you think they should get a stimulus check.

    I’ll bet Kodak execs get bonuses, just like, say, Nortel execs got them for their wise restructuring strategies post Ch11, too. Ch 11 and liquidation is the best path, trust them. As always

    Kodaks not forced to do trade with China, they do business with China cuz it offers more profit than manufacturin’ in the US, paying its millions or workers virtually nothing, just like them sweat shops in the US before the Great Depression.
    And pensions grew from people being loyal to Kodak, which means nothing on paper if it doesn’t earn someone enough profit, as usual.
    Will any wealthy folks step up and throw some spare change at people without money, or will they laugh and say “let the govt bail them out”. Hey, thats what the left say, too.

    http://www.fin.gov.on.ca/en/consultations/pension/nortel-faqs.html

    Frequently Asked Questions for Nortel Pensioners
    Q1- What is the government proposing?

    The government will introduce legislation that would, if passed, provide Nortel pensioners with the choice to opt out of conventional life annuity purchases and transfer the commuted value (CV) of their pensions to any Life Income Fund (LIF) account. If they do not choose, annuities will be purchased on their behalf.

    This new option would parallel the option already available to plan members who are not yet receiving a pension.

    It parallels a recently-introduced provision in Quebec for pensioners in plans that are being wound up as a result of a sponsor’s insolvency.

    Q2 – Why is a life annuity considered the default option?

    The purchase of an annuity is the normal outcome for pensioners following a pension plan wind up. The annuity is purchased by the plan administrator on behalf of the pensioner and provides a retirement income for the life of the pensioner, and survivor, if any.

    Q3 – What happens if a pensioner does not want to transfer their commuted value to a LIF?

    If a pensioner does not wish to opt out of the conventional annuity purchase, then the Plan Administrator will purchase an annuity. This annuity will be based on the pension to which the pensioner is entitled upon the wind up of the plan. If the pension had joint and survivor benefits, then the annuity will provide a lifetime payment with joint and survivor benefits.

    Pensioners who do not expressly choose to opt out will have an annuity purchased for them.

    Q4 – What happens if a pensioner wants to transfer their commuted value to a LIF?

    If the legislation is passed, pensioners who wish to transfer the commuted value of their pensions to a Life Income Fund account will be able to do so.

    If a pensioner has selected this transfer option in writing, the plan administrator will transfer the commuted value of their pension to a LIF account established by them at the financial institution of their choice.

    LIFs pay an annual income, but that amount can vary from year to year. There is a minimum percentage that must be withdrawn from the LIF each year and a maximum amount that may be withdrawn in any year. However there is no guarantee that there will be enough money in the LIF to pay the owner an income for his or her lifetime. The LIF owner can also name a beneficiary to receive the funds from the LIF after they die.

    Q5 – What is the government’s position on the NRPC’s Financial Sponsorship Model (FSM)?

    The proposed legislation would allow a pensioner to choose to transfer his or her commuted value into any LIF instead of receiving a life annuity. The Nortel pensioners will have to consider their own individual options.

    Q6 – Will the FSM be the only choice for Nortel pensioners if they choose to transfer their commuted value?

    No. If the legislation passes, pensioners who choose to transfer the commuted value of their pension to a LIF will have the choice of a registered LIF offered by any financial institution.

    Cmon, the govt should have to be there for emergencies only, not charity.

    http://http://www.fiercetelecom.com/story/nortels-former-ceo-roth-wants-1-billion/2009-12-21

    When the financial-going got tough at Nortel in 2001, former CEO John Roth got going. Now, eight years after he retired from the company, Roth wants his former employer to give him $1 billion indemnification against shareholder lawsuits.

    Roth’s claim is designed to protect his assets in the event that U.S. courts mandate that he pay plaintiffs if they win class action lawsuits, which were on hold due to Nortel’s bankruptcy proceedings. These lawsuits, which were filed about four years ago, name Nortel and other executives, who encouraged Nortel employees to continue to invest in the company’s 401(k) plan despite the company’s weakening financial state.

    Roth, who left the company in 2001–a time when Nortel’s financial state really began to falter–made off with about $130 million in stock options, bonuses and retirement benefits.

    He’d make a good cruise ship captain overseas. Are any moneygrubbers who hailed him a genius angry in any way that the govt is spending their tax money due to his corporate guidance? Nah, its the unfair unions fault.

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  80. sahrab says:

    I’ll bet Kodak execs get bonuses, just like

    Do you have an agreement with your employer to draw a paycheck for work you performed?

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  81. hohokiss says:

    Sure, its called a salary.

    Friday, March 20, 2009 | 2:51 PM ET

    Nortel seeking bonuses for top execs
    IN DEPTH: Retention bonuses infuriate, but they’re not uncommon
    Nortel Networks files for bankruptcy protection
    Nortel cutting another 3,200 jobs
    Nortel loses $2.13B US in Q4

    Julie Van Dusen reports: Nortel bonuses approved by courts (Runs: 2:38)
    Courts in Ontario and Delaware gave Nortel Networks permission on Friday to pay retention bonus money to eight senior executives while the company restructures under creditor protection.

    Reports indicated the eight executives could receive up to $7.3 million US in bonus money.

    The payments are part of a bigger $23-million US incentive program covering 92 staff at the telecommunications company.

    Lawyers representing some of the 1,000 workers who were denied severance pay after the company went into creditor protection in January objected Friday to payment of the bonuses to the eight.

    A broader bonus-pay plan involving about 900 employees was approved by the court earlier this month, but approval for the retention bonuses for the eight executives, including three staff in Canada and five in the United States, was not part of that decision.

    Nortel has said that bonuses are required to help keep staff from defecting while the company is restructuring. The bonuses for the executives are tied to meeting goals such as cost-cutting.

    So you run a company into the ground and are rewarded money for not quitting and cutting costs by filing bankruptcy.

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  82. sahrab says:

    How much of your salary to you give back to your employer because you were overpaid?

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  83. Xetrov says:

    Kodaks not forced to do trade with China

    Swing and a Miss. China imports goods into the US using unfair trade practices, thus Kodak was affected by it.

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  84. hohokiss says:

    How much of your salary to you give back to your employer because you were overpaid?

    Apples and oranges. If I consistently don’t meet some hourly quota, I don’t ask for more money because my shortfall is less than it could’ve been.

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  85. hohokiss says:

    Swing and a Miss. China imports goods into the US using unfair trade practices, thus Kodak was affected by it.

    Thats is true, but saying so is “playing victim”, depending on who does it. “It was one of many little items that all added up”.
    No execs, no politicians face any danger of having to move into a smaller home or file for bankruptcy, mess less endure shame, for sucking on the job, unlike countless ordinary folk who didn’t. If they can’t pay taxes, screw them.

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  86. hohokiss says:

    Claiming that offering “free” healthcare, education, pension, etc. via taxes leads to welfare states in which nobody wants to work anymore to is rather cynical. Where’d the “Love thy neighbor” talk go.

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  87. hist_ed says:

    you do realize at that point you’ve done nothing but shift the scale? This is the same fallacy as raising minimum wage.

    In order to increase the income of the bottome end/minimum wage it is going to cost businesses more to operate (higher wages comes out of operations)

    Time for you to be honest, do you expect businesses to eat those increased operations costs? If your realistic, you know that the businesses will pass those costs onto the consumers.

    No fucking shit. I thought that the reference to a “magic wand” might have clued people in, but I guess I have to say that the magic wand scenario I asked about above is not actually a serious economic proposal. Just to be clear, the only magic wand I have is reserved for Mrs Hist_ed and, despite its many amazing powers, it can do little to affect the economy except add the occasional future worker. My little question was an attempt to get a little insight. Too many people (CM seemed to be angling towards this) talk as if they think that the gap between rich and poor is the most important economic statistic. My little question was an attempt to illustrate that things can get better for everyone even if the gap is increasing (and yes, it was a variation on Thatcher’s famous critique of the British Labour party).

    The left, the Democratic Party and the media (but I repeat myself) concentrate their economic analysis on the statistics that make things seem the worst for their constituents. Using trends in household income instead of individual income, looking at the poor’s wages instead of their overall income, looking at changes in wages instead of overall compensation, etc. all make things seem worse than they are and thus in need of yet another government program to make things better.

    So, taking the income gap as the most important economic statistic when judging our country’s economy is another example. Yes, a growing income gap ain’t the greatest thing, but as long as all classes are improving, it ain’t so important.

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  88. hist_ed says:

    The ‘firefighters and schoolteachers’ thing comes from this quote from the NY Times article I linked to:

    Oh and CM, from your quote the NYTs mentioned “preschool teachers.” In the US you do not need the same training to be a preschool teacher as you do to teach elementary and secondary. It varies from state to state, but generally a background check is all that is required with many more requiring a small amount of training. Employers may insist on a high school diploma or even a college degree, but, to my knowledge, a teaching certificate is not required in any state.

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  89. sahrab says:

    No fucking shit

    You do know my response wasnt directed at you?

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  90. Poosh says:

    How much of your salary do you give back to your employer because you were overpaid?

    PRIMARY WEAPON FIRED

    MAXIMUM DAMAGE

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  91. hist_ed says:

    You do know my response wasnt directed at you?

    Yes. You do know that you were responding to an answer to the magic wand question? That, given the context of the whole magic wand thing, maybe CM there wasn’t too concerned about going through the entire macroeconomic effects of my peni . . . , I mean, magic wand? Now CM and I aren’t normally butt buddies on this here site (though that picture of CM squatting whilst shearing a sheep did, ummm, strangely stir something-perhaps there’s another one in Levi’s 501s?) but I did think to step in and point out that you were holding someone accountable for the real life economic projections that might happen if I waived my peni . . . uhhhhh, magic wand.

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