Closing the wealth gap

22,100 Views | 526 Replies | Last: 2 mo ago by DiabloWags
DiabloWags
How long do you want to ignore this user?
Unit2Sucks said:

Tom you seem to be missing the point that no one was paying the nominal rates. Here's a chart showing federal tax receipts as a % of GDP for the last 80 years or so.



I will say this again but I don't think that tax policy will solve wealth inequality. Most people seem to be focused on confiscatory policies which will make wealthy people less wealthy but won't make poor people more wealthy. Even if we taxed poor people 0% we wouldn't solve wealth inequality. I'm not sure why people think that making wealthy people poorer will solve our problems but unless we use that confiscation to actually improve the lives of the poor. When I say "poor" I'm using that as shorthand for everyone who isn't wealthy. Growing the economy and improving wages will certainly help improve people's lives but it won't really lead to wealth accumulation for most people.

Here is what I think the real problem is and no one is talking about it. Our economy is based on consumer spend. We are a consumerist culture and it drives the vast majority of our GDP. The powers that be DO NOT WANT people to accumulate wealth, they want them to spend it so we can get that multiplier. We tolerate wealthy people accumulating wealth, but would prefer everyone just spend more. When the real wages of poor people increase, that goes almost entirely to increased spend, which boosts our economy. If it didn't, it wouldn't really create an economic good. So when we talk about wealth inequality, the vast majority of the people just want to make wealthy people less wealthy because there is very little chance that we will ever do anything to increase the wealth of the poor. If we did, it would probably prove fatal to our economy (think Japan with its high savings rates and low GDP growth for decades).

I'm doubtful that tax policy (unless it's in service of true game changers) will solve the problems people think exist.

Damn.... that was a most INSIGHTFUL post.
So good!

DiabloWags
How long do you want to ignore this user?
Unit2Sucks said:


I will say this again but I don't think that tax policy will solve wealth inequality. Most people seem to be focused on confiscatory policies which will make wealthy people less wealthy but won't make poor people more wealthy. Even if we taxed poor people 0% we wouldn't solve wealth inequality. I'm not sure why people think that making wealthy people poorer will solve our problems but unless we use that confiscation to actually improve the lives of the poor. When I say "poor" I'm using that as shorthand for everyone who isn't wealthy. Growing the economy and improving wages will certainly help improve people's lives but it won't really lead to wealth accumulation for most people.



Excellent point!

Just like how the State of California has thrown BILLIONS at EDUCATION with one taxpayer proposition after another, and yet the State is ranked in the bottom third. It just goes to show you that you can THROW TONS OF MONEY at an issue, and yet still not solve it.

Confiscating money from the wealthy will not solve the wealth inequity issue.

Here in California (where capital gains are taxed as ordinary income) we are enjoying a record breaking $75 BILLION DOLLAR SURPLUS off the backs of the wealthy DURING A PANDEMIC. And the last time I checked, that surplus hasnt fixed the wealth inequality problem.


bearister
How long do you want to ignore this user?
The more crumbs the wealthy push off their table to the unwashed masses, the longer they will be able to perpetuate the great gig they have going….but when you have the mentality that allows you to stand on a dime barefoot and know whether it is heads or tails, this simple truth seems counterintuitive.
Cancel my subscription to the Resurrection
Send my credentials to the House of Detention
I got some friends inside
DiabloWags
How long do you want to ignore this user?
bearister said:

The more crumbs the wealthy push off their table to the unwashed masses, the longer they will be able to perpetuate the great gig they have going….but when you have the mentality that allows you to stand on a dime barefoot and know whether it is heads or tails, this simple truth seems counterintuitive.

Funny.
I dont recall anyone going along with me and taking the FINANCIAL RISK that I did to get where I am today.
It certainly wasnt the Government.
going4roses
How long do you want to ignore this user?
What about those whom have never had fair shake(400+ years) but whose sweat , blood and tears built the initial wealth of the United States?

Not by choice by force !!!

And still haven't been paid!!!

You must be 100% for Reparations


Big C
How long do you want to ignore this user?
DiabloWags said:

bearister said:

The more crumbs the wealthy push off their table to the unwashed masses, the longer they will be able to perpetuate the great gig they have going….but when you have the mentality that allows you to stand on a dime barefoot and know whether it is heads or tails, this simple truth seems counterintuitive.

Funny.
I dont recall anyone going along with me and taking the FINANCIAL RISK that I did to get where I am today.
It certainly wasnt the Government.



To paraphrase "a certain Senator from Massachusetts", didn't the government provide the defense that gave you a safe, secure nation to take that risk? Didn't the government fashion a nation of laws and credible systems in which your risk could flourish protected and unimpeded? Didn't the government provide the roads and other infrastructures that helped your risk succeed? Didn't the government provide the education that enabled your workers to work well and your customers to afford your product?

Give me a break.
DiabloWags
How long do you want to ignore this user?
Big C said:

DiabloWags said:

bearister said:

The more crumbs the wealthy push off their table to the unwashed masses, the longer they will be able to perpetuate the great gig they have going….but when you have the mentality that allows you to stand on a dime barefoot and know whether it is heads or tails, this simple truth seems counterintuitive.

Funny.
I dont recall anyone going along with me and taking the FINANCIAL RISK that I did to get where I am today.
It certainly wasnt the Government.



To paraphrase "a certain Senator from Massachusetts", didn't the government provide the defense that gave you a safe, secure nation to take that risk? Didn't the government fashion a nation of laws and credible systems in which your risk could flourish protected and unimpeded? Didn't the government provide the roads and other infrastructures that helped your risk succeed? Didn't the government provide the education that enabled your workers to work well and your customers to afford your product?

Give me a break.


Right.

I, and others never paid any TAXES to build those roads and bridges or schools and support a DoD budget. They just appeared out of thin air!

Get real.
Big C
How long do you want to ignore this user?
DiabloWags said:

Big C said:

DiabloWags said:

bearister said:

The more crumbs the wealthy push off their table to the unwashed masses, the longer they will be able to perpetuate the great gig they have going….but when you have the mentality that allows you to stand on a dime barefoot and know whether it is heads or tails, this simple truth seems counterintuitive.

Funny.
I dont recall anyone going along with me and taking the FINANCIAL RISK that I did to get where I am today.
It certainly wasnt the Government.



To paraphrase "a certain Senator from Massachusetts", didn't the government provide the defense that gave you a safe, secure nation to take that risk? Didn't the government fashion a nation of laws and credible systems in which your risk could flourish protected and unimpeded? Didn't the government provide the roads and other infrastructures that helped your risk succeed? Didn't the government provide the education that enabled your workers to work well and your customers to afford your product?

Give me a break.


Right.

I, and others never paid any TAXES to build those roads and bridges or schools and support a DoD budget.

Get real.


Yes, I assume you paid taxes that helped fund the government that provided the infrastructure that set you up to succeed. But did you pay your "fair" share? I believe that's what this thread is about.

I cannot answer that question, but what I can say is...

- The government is running huge deficits.
- We have enormous wealth inequalities. (Will tomorrow's customers even be able to afford tomorrow's products?)
- The infrastructure that enables people to take reasonable risks to succeed is crumbling.
- We appear to be using the earth's resources at a rate that is unsustainable.

I would conclude from the above that some people are not paying their fair share. The question is, who are these people and what constitutes "fair"? A very complicated question and certainly one to debate.

concordtom
How long do you want to ignore this user?
going4roses said:

What about those whom have never had fair shake(400+ years) but whose sweat , blood and tears built the initial wealth of the United States?

Not by choice by force !!!

And still haven't been paid!!!

You must be 100% for Reparations



How do you propose "reparations" occur?
Who pays what?
Who receives what?
DiabloWags
How long do you want to ignore this user?
BigC said:



I would conclude from the above that some people are not paying their fair share. The question is, who are these people and what constitutes "fair"? A very complicated question and certainly one to debate.




Per 2018 IRS data, the Top 5% paid 60.3% of all federal income taxes. In California, the Top 1% paid over 46% of state income taxes.

California currently enjoys a record breaking $75 Billion dollar surplus, during a Pandemic. Who do you think that record revenue came from? Do you think that record surplus came from the lower economic classes paying their "fair" share.

I think that data would indicate that the "wealthy" more than paid their "fair" share. I wonder if the same can be said by "other" socio-economic classes? Do you have data showing that they paid their "fair" share?


Big C
How long do you want to ignore this user?
DiabloWags said:

BigC said:



I would conclude from the above that some people are not paying their fair share. The question is, who are these people and what constitutes "fair"? A very complicated question and certainly one to debate.




Per 2018 IRS data, the Top 5% paid 60.3% of all federal income taxes. I think that would indicate that the "wealthy" paid their fair share. I wonder if the same can be said by "others".


So . . . "Tax the non-rich!"

Maybe not a winning political slogan, but then, you're probably not running for office. So go with it!
DiabloWags
How long do you want to ignore this user?
Big C said:


"Tax the non-rich!"

Maybe not a winning political slogan, but then, you're probably not running for office. So go with it!


You sure know how to DEFLECT.
Sounds like youre much more talented than me when it comes to running for political office.

Bring up "fair" share.
Then ...



Deflect.
Deflect.
Deflect.
going4roses
How long do you want to ignore this user?
First part: Full and clear admittance.

And with the looks the awakening trump brought to the surface the hole to climb out to admittance got even deeper.
concordtom
How long do you want to ignore this user?
going4roses said:

First part: Full and clear admittance.

And with the looks the awakening trump brought to the surface the hole to climb out to admittance got even deeper.


Perhaps a different word, then, than "reparations".

wifeisafurd
How long do you want to ignore this user?
bearister said:

Huge 20-Year Study Shows Trickle-Down Is a Myth, Inequality Rampant


https://www.businessinsider.com/how-bad-is-inequality-trickle-down-economics-thomas-piketty-economists-2021-12

The World InequalityReport 2022 presents the most up-to-date & complete data on inequality worldwide:


https://wir2022.wid.world/
The world has no hard numbers on income inequality. Most countries don't even have keep data needed to calculate wealth, no less wealth concentration, but keep posting those headlines Bearister.

I'm pretty sure neither Bearister nor the journalist with the agenda read Piketty' book because it didn't discuss trickle down. The book went through a 20 years statistical study that wealth grows faster than economic output, thus concentrating capital (and the income it produces) in ever-fewer hands. For the record, that has nothing to do with trickle down theory.

There was a sense among academic economists that the book was a justification of Piketty views (he is an unapologetic socialist), and the reaction outside of say Saenz, was, in general, quite harsh. Mr. Harvard, Lawrence Summers, perhaps the foremost representative of the economist elites at the highest reaches of the recent policymaking in Democratic administrations, declared Piktty's capital diminishes more slowly than capital itself accumulates (hence, the famous formulation, r > g) is at odds with econometric evidence suggesting the opposite conclusion about the "marginal elasticity of substitution" between labor and capital. Hence it cannot be that a rising capital-to-income ratio causes a rising capital share of national income (that is he said Piketty's study is full of sheet). Then the Brooking economists with a bunch of American academics and Fed dudes said rising capital-to-income ratio in Piketty's data is disproportionately the result of the price appreciation of certain scarce stores of wealth, primarily housing and the land it sits on, not the quantity accumulation of productive capital that is the subject of the neoclassical theory of economic growth (where Keynes is labelled trickle down).

But perhaps the greatest rebuke of Piketty to be found is not contained in any of these attacks on his scholarship but rather in the deafening silence that greets it, as well as wealth inequality in general, There are very few universities that have scholarship that has any obvious or even secondary bearing on the themes raised by Piketty (Cal being one of few exceptions).

Edit: Piketty's book is a good read despite the academic criticism. My favorite of his theories is that the American middle class was created by defense spending.
dajo9
How long do you want to ignore this user?
DiabloWags said:

BigC said:



I would conclude from the above that some people are not paying their fair share. The question is, who are these people and what constitutes "fair"? A very complicated question and certainly one to debate.




Per 2018 IRS data, the Top 5% paid 60.3% of all federal income taxes. In California, the Top 1% paid over 46% of state income taxes.

California currently enjoys a record breaking $75 Billion dollar surplus, during a Pandemic. Who do you think that record revenue came from? Do you think that record surplus came from the lower economic classes paying their "fair" share.

I think that data would indicate that the "wealthy" more than paid their "fair" share. I wonder if the same can be said by "other" socio-economic classes? Do you have data showing that they paid their "fair" share?



Statistics on what income levels pay federal taxes are a reflection of who is getting income and who is not getting income. The 1% pay a higher share of taxes because they receive a higher share of income relative to what was happening in the past.
dajo9
How long do you want to ignore this user?
Unit2Sucks said:




Payroll Taxes:
https://www.cbpp.org/payroll-taxes-as-a-share-of-federal-revenues

Corporate Income Taxes:
https://www.pgpf.org/blog/2021/04/six-charts-that-show-how-low-corporate-tax-revenues-are-in-the-united-states-right-now

Federal revenue has pretty consistently stayed around 17% of GDP but the composition of that revenue has changed a lot over the decades. From the charts in the links above you can see that corporate income tax revenue has dropped about 3% of GDP over time. That has been replaced by the regressive payroll tax.

It is entirely appropriate for Payroll tax revenue to have grown due to demographics (Baby Boomers) and the addition of medicare. Costs associated with the payroll tax (mostly social security and medicare) have grown as well. What is missing is the 3% of GDP that corporations are no longer being taxed, which turns right into corporate equity and directly boosts wealth inequality.

How much is 3% of GDP? In today's dollars that is about $600 billion every year. Over a typical 10 year budget window that is $6 trillion. Double the cost of BBB. Double the estimated revenue generated from Elizabeth Warren's wealth tax. About 30x more than the marginally impactful cost-basis step up (based on Wharton's analysis of the April 2021 Biden proposal https://budgetmodel.wharton.upenn.edu/issues/2020/1/23/the-biden-tax-plan ).
Unit2Sucks
How long do you want to ignore this user?
dajo9 said:

Unit2Sucks said:




Federal revenue has pretty consistently stayed around 17% of GDP but the composition of that revenue has changed a lot over the decades. From the charts in the links above you can see that corporate income tax revenue has dropped about 3% of GDP over time. That has been replaced by the regressive payroll tax.
Sure but it's not just an increase in payroll tax, it's also an increase in income tax. I think payroll taxes are both less regressive than before (uncapped medicare) and cover a broader social program than before.

I don't disagree that we should increase corporate income taxes, but I don't think that it will change wealth inequality for all the reasons I've set forth above in this thread. We are arguing around the margins of how we pay for things that won't really make an impact on the accumulation of wealth.
dajo9
How long do you want to ignore this user?
Unit2Sucks said:

dajo9 said:

Unit2Sucks said:




Federal revenue has pretty consistently stayed around 17% of GDP but the composition of that revenue has changed a lot over the decades. From the charts in the links above you can see that corporate income tax revenue has dropped about 3% of GDP over time. That has been replaced by the regressive payroll tax.
Sure but it's not just an increase in payroll tax, it's also an increase in income tax. I think payroll taxes are both less regressive than before (uncapped medicare) and cover a broader social program than before.

I don't disagree that we should increase corporate income taxes, but I don't think that it will change wealth inequality for all the reasons I've set forth above in this thread. We are arguing around the margins of how we pay for things that won't really make an impact on the accumulation of wealth.
Income taxes as a share of federal revenue is minimally changed over time (see the link). It has skewed towards the wealthy because the wealthy have a higher share of income. That by itself is part of the problem.
https://www.cbpp.org/sites/default/files/atoms/files/PolicyBasics_WhereDoFederalTaxRevsComeFrom_08-20-12.pdf

I don't think the change in corporate income tax revenue is "arguing around the margins" at all. I think it is a major component of the issue. All the more reason why we need to brainstorm for ideas. An alliance of free nations to get together and form a common construct for trade and taxes? Implement a wealth tax? Find a profit sharing mechanism (the 82grad idea)? These are just ideas we could look into. First, we have to have the will.
Unit2Sucks
How long do you want to ignore this user?
dajo9 said:

Unit2Sucks said:

dajo9 said:

Unit2Sucks said:




Federal revenue has pretty consistently stayed around 17% of GDP but the composition of that revenue has changed a lot over the decades. From the charts in the links above you can see that corporate income tax revenue has dropped about 3% of GDP over time. That has been replaced by the regressive payroll tax.
Sure but it's not just an increase in payroll tax, it's also an increase in income tax. I think payroll taxes are both less regressive than before (uncapped medicare) and cover a broader social program than before.

I don't disagree that we should increase corporate income taxes, but I don't think that it will change wealth inequality for all the reasons I've set forth above in this thread. We are arguing around the margins of how we pay for things that won't really make an impact on the accumulation of wealth.
Income taxes as a share of federal revenue is minimally changed over time (see the link). It has skewed towards the wealthy because the wealthy have a higher share of income. That by itself is part of the problem.
https://www.cbpp.org/sites/default/files/atoms/files/PolicyBasics_WhereDoFederalTaxRevsComeFrom_08-20-12.pdf

I don't think the change in corporate income tax revenue is "arguing around the margins" at all. I think it is a major component of the issue. All the more reason why we need to brainstorm for ideas. An alliance of free nations to get together and form a common construct for trade and taxes? Implement a wealth tax? Find a profit sharing mechanism (the 82grad idea)? These are just ideas we could look into. First, we have to have the will.
If "the issue" is the wealth gap, than I don't think corporate income tax is a solution. I'm not sure that anyone in congress is really trying to address this topic other than by wanting to reduce the wealth of wealthiest people.

I agree that we are still early in brainstorming in the national conversation. I think the answer may be that the solution to absence of wealth is a strong baseline of entitlements. That's what social security and medicare are supposed to do but they aren't enough. I don't think there is ever going to be a solution that creates household wealth for the vast majority of Americans and I'll explain why.

The median net worth in the US is around $120k. Around 1/3 of households have negative net worth. Of those with positive net worth, vast majority (2/3+) of that is home equity. So generally speaking, most Americans have almost no financial security. We saw a spike in personal savings rates at the beginning of the pandemic with the stimulus plus reduction in consumer spend but that has now reversed and people are saving less than ever.



If we gave every below-median American household $100k it would cost us something like $6T. That would initially be saved but would eventually flow through the economy and following all of that stimulus I very much doubt we would see a massive shift in net worth retention by below-median households.

Long story short, I don't think the wealth gap is the real issue or something that can be resolved. I think we need to prevent poverty and there are a number of social programs that can help. I don't think they would cost anywhere near what it would cost to "close the wealth gap." The problem is that when people frame the problem this way, they ignore the problems we should be solving in favor of an insolvable "problem."

Just a small anecdote but a relative of a friend recently settled a small tort lawsuit (from a car accident) where she received $50k. She was not in poverty, but had no net worth and lived paycheck to paycheck. She and her family were excited about the opportunity this would give her to build wealth. A year later, the money has been spent (some of it on things like home improvements) but it has not materially changed her financial profile or outlook. She still needs a social safety net. I don't think her story is atypical.
concordtom
How long do you want to ignore this user?
Very good questions there.
Perhaps we have a society (or a species:humans) where a certain percentage are simply always going to fall down.

So, if it's 20%, what should we do for them? What is humane?



The other thought I'm having is how we can decrease 20% to 18% to 15% to 10%. Perhaps we should use that hypothetical $6T you mentioned and put it toward education, social sciences dealing with developing self esteem, goal setting and achieving, mental health. Like, maybe our society manufactures a great percentage of that 20% through our collective cultural illness.

dajo9
How long do you want to ignore this user?
Unit2Sucks said:

dajo9 said:

Unit2Sucks said:

dajo9 said:

Unit2Sucks said:




Federal revenue has pretty consistently stayed around 17% of GDP but the composition of that revenue has changed a lot over the decades. From the charts in the links above you can see that corporate income tax revenue has dropped about 3% of GDP over time. That has been replaced by the regressive payroll tax.
Sure but it's not just an increase in payroll tax, it's also an increase in income tax. I think payroll taxes are both less regressive than before (uncapped medicare) and cover a broader social program than before.

I don't disagree that we should increase corporate income taxes, but I don't think that it will change wealth inequality for all the reasons I've set forth above in this thread. We are arguing around the margins of how we pay for things that won't really make an impact on the accumulation of wealth.
Income taxes as a share of federal revenue is minimally changed over time (see the link). It has skewed towards the wealthy because the wealthy have a higher share of income. That by itself is part of the problem.
https://www.cbpp.org/sites/default/files/atoms/files/PolicyBasics_WhereDoFederalTaxRevsComeFrom_08-20-12.pdf

I don't think the change in corporate income tax revenue is "arguing around the margins" at all. I think it is a major component of the issue. All the more reason why we need to brainstorm for ideas. An alliance of free nations to get together and form a common construct for trade and taxes? Implement a wealth tax? Find a profit sharing mechanism (the 82grad idea)? These are just ideas we could look into. First, we have to have the will.
If "the issue" is the wealth gap, than I don't think corporate income tax is a solution. I'm not sure that anyone in congress is really trying to address this topic other than by wanting to reduce the wealth of wealthiest people.

I agree that we are still early in brainstorming in the national conversation. I think the answer may be that the solution to absence of wealth is a strong baseline of entitlements. That's what social security and medicare are supposed to do but they aren't enough. I don't think there is ever going to be a solution that creates household wealth for the vast majority of Americans and I'll explain why.

The median net worth in the US is around $120k. Around 1/3 of households have negative net worth. Of those with positive net worth, vast majority (2/3+) of that is home equity. So generally speaking, most Americans have almost no financial security. We saw a spike in personal savings rates at the beginning of the pandemic with the stimulus plus reduction in consumer spend but that has now reversed and people are saving less than ever.



If we gave every below-median American household $100k it would cost us something like $6T. That would initially be saved but would eventually flow through the economy and following all of that stimulus I very much doubt we would see a massive shift in net worth retention by below-median households.

Long story short, I don't think the wealth gap is the real issue or something that can be resolved. I think we need to prevent poverty and there are a number of social programs that can help. I don't think they would cost anywhere near what it would cost to "close the wealth gap." The problem is that when people frame the problem this way, they ignore the problems we should be solving in favor of an insolvable "problem."

Just a small anecdote but a relative of a friend recently settled a small tort lawsuit (from a car accident) where she received $50k. She was not in poverty, but had no net worth and lived paycheck to paycheck. She and her family were excited about the opportunity this would give her to build wealth. A year later, the money has been spent (some of it on things like home improvements) but it has not materially changed her financial profile or outlook. She still needs a social safety net. I don't think her story is atypical.
I think it is two sides of the same coin. We have massive debt, a massive health care problem, and a massive infrastructure problem. Resolving health care and infrastructure all benefit the average American through more jobs or services. The question is, where will that money come from? The answer is the wealthy. 3% of GDP / year goes a long way.
Unit2Sucks
How long do you want to ignore this user?
dajo9 said:


I think it is two sides of the same coin. We have massive debt, a massive health care problem, and a massive infrastructure problem. Resolving health care and infrastructure all benefit the average American through more jobs or services. The question is, where will that money come from? The answer is the wealthy. 3% of GDP / year goes a long way.
I mostly agree but I will just note that we spend almost 4% of GDP on defense and apart from the stimulus/welfare effect, I don't think it does very much for our company. I would love to see us bring military spend down to 1.5-2%. We would still have the most expensive military in the world by far at that level and we would have a lot more money to spend on productive uses like health care and infrastructure.

I agree with Tom on education as well but what I disagree is that our goal should be creating wealth for people. People need security to know that they are protected against the worst outcomes. Creating "wealth" for the masses would be a very poor use of government resources.
DiabloWags
How long do you want to ignore this user?
dajo9 said:

DiabloWags said:

BigC said:



I would conclude from the above that some people are not paying their fair share. The question is, who are these people and what constitutes "fair"? A very complicated question and certainly one to debate.




Per 2018 IRS data, the Top 5% paid 60.3% of all federal income taxes. In California, the Top 1% paid over 46% of state income taxes.

California currently enjoys a record breaking $75 Billion dollar surplus, during a Pandemic. Who do you think that record revenue came from? Do you think that record surplus came from the lower economic classes paying their "fair" share.

I think that data would indicate that the "wealthy" more than paid their "fair" share. I wonder if the same can be said by "other" socio-economic classes? Do you have data showing that they paid their "fair" share?



Statistics on what income levels pay federal taxes are a reflection of who is getting income and who is not getting income. The 1% pay a higher share of taxes because they receive a higher share of income relative to what was happening in the past.

I'm very much aware of that.

But the liberal battle cry of "We just want them (the wealthy) to pay their fair share" that I hear bandied about several times a month on SF Bay Area talk radio (KGO) ignores the reality that the rich do in fact pay a TON of taxes.

It's interesting to me that people actually believe that there is some kind of a "loop-hole" in California that allows the rich not to pay any taxes. But the bottom line is that the liberals and "critics" that call into these talk shows have no idea. They really dont. Perhaps if they made a chunk of money (in one year) they'd have a much better appreciation for the extremely progressive tax code and who pays what, in CALIFORNIA.

In fact, given that California is enjoying a record budget surplus during a Pandemic, one could realistically make the argument that marginal income tax rates in California are far too progressive, especially at the upper levels. The State has never been close to producing a $75 Billion Dollar Surplus. Not anywhere close. And yet it's happened during a pandemic where most lower class jobs disappeared due to Covid and the economy took a massive hit.

As I pointed out to Tom in a previous post, California treats long term capital gains as ORDINARY INCOME. This means that the rate is 20% + 12.3% = 32.3% for any gains above $625,370.

If the gains are over $1.0 million, add another 1% for the Mental Health Services Act via Prop. 63 that raises about $2 BILLION each year for the care of the mentally ill. - - - Has anyone here been aware of this 1% mental health surcharge before I mentioned it just now? Anyone??? - - - If so, please raise your hand.

One final point:

You'll never see Senator Warren or Bernie Sanders ever be "thankful" for entrepreneurship in Silicon Valley.

They dont care about entrepreneurs working hard and taking risk and keeping the U.S. economy vibrant, creative, and innovative like no other economy in the world. The United States is #1 in the world when it comes to services. There's a very good reason for that. Our economy is full of entrepreneurs who are creative and innovative and we have the deepest financial markets in the world that attract investors who wish to fund these "game-changing" ideas and technologies. - - - We dont produce "knock-off" products like China does. We create from scratch. We innovate. And it doesnt matter what color of skin the innovator is.

To me, this is what America is all about.

Socialists like Warren and Sanders just use entrepreneurs as punching bags.
And the word risk is simply not in their vocabulary. They believe that GOVT is much better at allocating your capital, than you are. - - - Unfortunately, I dont find much of a historical record that supports that claim.








DiabloWags
How long do you want to ignore this user?
Unit2Sucks said:




I agree with Tom on education as well but what I disagree is that our goal should be creating wealth for people. People need security to know that they are protected against the worst outcomes. Creating "wealth" for the masses would be a very poor use of government resources.
Well said.

And as you pointed out earlier, handing everyone $50,000 or $100,000 would not do anything to increase one's wealth because they would invariably spend all of it.

I'm all for "safety" nets and incentivizing things like education and securing the livelihood of our environment.

Prove that youre serious about attending your local JC and getting good grades, and I would be more than happy to support a Bill that pays for a student's second year for FREE. Dont just show up at your local JC expecting to "slide" through and spend your next 5 years there (off and on between odd retail jobs) just because its FREE and it makes your parents feel good about you.

But simply handing out money does nothing to create behavioral change that leads to self-sufficiency, let alone wealth accumulation. If you dont believe so, take a look at the people of Flint, Michigan over the last three decades and who they continue to vote into office to "help" them.
concordtom
How long do you want to ignore this user?
DiabloWags said:



As I pointed out to Tom in a previous post, California treats long term capital gains as ORDINARY INCOME. This means that the rate is 20% + 12.3% = 32.3% for any gains above $625,370.

If the gains are over $1.0 million, add another 1% for the Mental Health Services Act via Prop. 63 that raises about $2 BILLION each year for the care of the mentally ill.



Id be more than happy to pay 32.3% if I could take home the 67.7% of $625,370.
Rather than complaining, how about celebrating?
wifeisafurd
How long do you want to ignore this user?
Unit2Sucks said:

dajo9 said:


I think it is two sides of the same coin. We have massive debt, a massive health care problem, and a massive infrastructure problem. Resolving health care and infrastructure all benefit the average American through more jobs or services. The question is, where will that money come from? The answer is the wealthy. 3% of GDP / year goes a long way.
I mostly agree but I will just note that we spend almost 4% of GDP on defense and apart from the stimulus/welfare effect, I don't think it does very much for our company. I would love to see us bring military spend down to 1.5-2%. We would still have the most expensive military in the world by far at that level and we would have a lot more money to spend on productive uses like health care and infrastructure.

I agree with Tom on education as well but what I disagree is that our goal should be creating wealth for people. People need security to know that they are protected against the worst outcomes. Creating "wealth" for the masses would be a very poor use of government resources.
Well I'm glad to see the discussion has moved beyond wealth taxes into something more tangible, such as the what should be social spending levels and who should fund it (my comment many posts ago). We have relatively high corporate tax rates, and corporations, particularly large tech corps and international corps doing business in the US, that don't pay much tax because income is placed off-shore (or through other devices). Despite efforts to improve the international tax regime, including with the 2017 tax law put in place under of all people Trump, companies still find workarounds. That includes profit-shifting, where companies book profits from higher-tax jurisdictions in lower-tax jurisdictions to lower their tax bills is an international problem, and it also is a practical problem because raising tax rates on limited income does't raise much revenue. I thought Biden was trying to address this by having other countries raise taxes and have a global minimum tax. For example, if Switzerland has higher corporate tax rates, companies in the Silicon Valley will have less inactive to have Swiss held patents that strip profits from US entities through royalty payments. There was an agreement spurred by Biden at the world leadership level to eliminate the race to the bottom- what happened?

The other side of the equation is social speeding and who should do it. At this juncture we give billionaires a choice. They can get deductions by giving to say Cal rather than the government directing that money. This raises the question as to who does a better job - private sector charity or universities or government.

Then there is the level of benefits. This county still takes the views to spend less to support the social needs of younger and working-age populations than did other countries. That is not true of seniors due to social security, medicare and other expensive benefits - and seniors vote. The US spends a high amount per capita - 10th among all countries according to the OECD, which is surprising (at least to me) given the view that in this country we want to incentivize people to work hard. Here is an article summarizing the numbers.Health And Social Spending In The US And Other High ...https://www.healthaffairs.org full

What it boils down to is the US government spends a lot more on health care per capita than other countries, not that the US, local government and charities do not spend much money on social programs - statistically they do. The promise of Obamacare was to bring down medical prices and that has not happened. Lot of fingers to point - Obamacare really has not been able to fully function for example, and there does not seem to be much initiative in the Biden administration to go after health care costs. But to say we don't spend money on social program is bunk. This has been an old argument point for years now but a single payer system or some form of that might have huge cost savings for the government and consumers and save a lot of money for other things like infrastructure. Just my two cents.
dajo9
How long do you want to ignore this user?
wifeisafurd said:


The promise of Obamacare was to bring down medical prices and that has not happened. Lot of fingers to point - Obamacare really has not been able to fully function for example, and there does not seem to be much initiative in the Biden administration to go after health care costs. But to say we don't spend money on social program is bunk. This has been an old argument point for years now but a single payer system or some form of that might have huge cost savings for the government and consumers and save a lot of money for other things like infrastructure. Just my two cents.
Do you have data to support your claims about Obamacare? The goal of Obamacare was to bring medical costs down relative to the cost expenditure projections at the time (not in absolute terms). I haven't seen data for many years but I did have this debate many times in years past (probably with you) and Obamacare absolutely did achieve its cost reduction goals at least as of approximately 2015 or so.

I support all these arguments for reduced military spending and more cost effective health care costs, which would save us all a ton of money. I don't see any path to achieving those goals other than voting for liberal Democrats, do any of you? The Presidential candidates that supported such things are people like Elizabeth Warren and Bernie Sanders.
DiabloWags
How long do you want to ignore this user?

No, Obamacare Did Not Lower U.S. Health Costs | MedPage Today
dajo9
How long do you want to ignore this user?
DiabloWags said:


No, Obamacare Did Not Lower U.S. Health Costs | MedPage Today

Here is what wiaf said:

Quote:

The promise of Obamacare was to bring down medical prices and that has not happened.
Even by the standards of the article you link, wiaf has misstated the goals of Obamacare. The goals of Obamacare were to reduce costs vs. the projections at the time. You can complain about the projections all you want, but reducing medical costs, in absolute terms, was never a stated goal of Obamacare.
DiabloWags
How long do you want to ignore this user?
concordtom said:

Very good questions there.
Perhaps we have a society (or a species:humans) where a certain percentage are simply always going to fall down.

So, if it's 20%, what should we do for them? What is humane?





Your City of Concord has C.O.R.E. Homeless Outreach.

H3 Homeless Programs :: Health, Housing & Homeless :: Contra Costa Health Services (cchealth.org)

The only problem... is that when a homeless person is asked if they need "help", they invariably say "No".
In fact, I am told by a City Council member that only 1 in 25 will say "Yes".
It's usually the single Mom that is living out of their car and is at wit's end.

At the other end of the County just across the border with Alameda,, the City of Livermore has remodeled a Motel property at a cost of $137,000 per room for the homeless. I believe it's a property with less than 50 units. The only problem is, is that the non-profit that is supposed to manage the property is down on funds, due to Covid.

concordtom
How long do you want to ignore this user?
Cal_79
How long do you want to ignore this user?
I'm very much enjoying this debate and appreciate hearing the various points of view. Thank you.

Question: When hearing the common refrain about wanting the wealth to pay their 'fair share' I'm left wondering, "What the heck does that mean?" What's the definition of 'fair share'?

BTW, I am aware of the extra 1% mental health tax.
wifeisafurd
How long do you want to ignore this user?
dajo9 said:

DiabloWags said:


No, Obamacare Did Not Lower U.S. Health Costs | MedPage Today

Here is what wiaf said:

Quote:

The promise of Obamacare was to bring down medical prices and that has not happened.
Even by the standards of the article you link, wiaf has misstated the goals of Obamacare. The goals of Obamacare were to reduce costs vs. the projections at the time. You can complain about the projections all you want, but reducing medical costs, in absolute terms, was never a stated goal of Obamacare.
You guys are both right and wrong. Obamacare reduced costs for the uninsured, by forcing providers to deal with cost controls that an insurer provides. Obamacare's more lofty goals of cost containment were never implemented. Here is an article attempting to explain that:


The ACA: Trillions? Yes. A Revolution? No. | Health Affairshttps://www.healthaffairs.org full

Debating Obamacare does no good at this time. It never was fully implemented. If you want to see cost controls look at Medicare, which is large in enough to impact providers. And Medicare could exercise more control over costs if extended to lower ages. The bottom line is if you look at why the US spends so much on its safety net, but seems to have less bang for the buck, the numbers suggest it has be healthcare costs, not wealth taxes, the top 1% or whatever:

How does health spending in the US compare to other ...https://www.healthsystemtracker.org chart-collection h...

wifeisafurd
How long do you want to ignore this user?
dajo9 said:

DiabloWags said:


No, Obamacare Did Not Lower U.S. Health Costs | MedPage Today

Here is what wiaf said:

Quote:

The promise of Obamacare was to bring down medical prices and that has not happened.
Even by the standards of the article you link, wiaf has misstated the goals of Obamacare. The goals of Obamacare were to reduce costs vs. the projections at the time. You can complain about the projections all you want, but reducing medical costs, in absolute terms, was never a stated goal of Obamacare.
Actually my wording was not as precise as it should have been. Here is what Obamacare was supposed to do:

ACA makes health care more affordable is its concerted effort to control rising health care costs while ensuring high-quality care for those who already have health insurance coverage. These features of the ACA have received less public attention because most people (and the media) do not fully understand our complex health care system. The majority of both public and private health insurance reimbursement mechanisms reward physicians for providing greater quantities of services, rather than providing higher-quality services. Health care professionals are richly rewarded for performing more open heart surgeries and angioplasties, while they receive little or no financial compensation for time expended educating patients to practice the healthy habits that would reduce the need for costly, aggressive medical treatments.

he ACA changes per-treatment reimbursement to a system that rewards high-quality care using several strategies. Medicare will soon begin to reward hospitals and physicians for establishing accountable care organizations. An ACO is a group of providers that works together to coordinate care for the patients they serve under Medicare. The Center for Medicare and Medicaid Services (CMS) will track the quality of the group's care and share savings with the ACO if its patient costs are lower than those in a yet-to-be-determined benchmark. ACOs will encourage coordinated care that is likely to improve patient outcomes and simultaneously reduce costs.

The ACA also calls for Medicare to move toward "bundled" payments for procedures such as open-heart surgery or hip replacement. Medicare currently makes separate payments to different health care professionals for services delivered during a single course of treatment, leaving individual physicians and hospitals little incentive to coordinate care. Under the ACA, CMS would move toward paying a single bundled payment to a team of caregivers for an episode of care, so that they will have an incentive to coordinate care and lower costs resulting from complications and delays, in order to earn greater net compensation.

The ACA also establishes an Independent Payment Advisory Board (IPAB) charged with developing detailed proposals to reduce the per-capita rate of growth in Medicare spending. The IPAB has been referred to as a "MedPAC on steroids." MedPAC, the Medicare Payment Advisory Commission, has been advising Congress for years on strategies for improving the structure of Medicare, but it only plays an advisory role. MedPAC issued a report in June 2010 identifying several highly promising strategies for controlling health care costs, such as coordinating reimbursement for dually eligible Medicare and Medicaid enrollees and adopting novel quality- and cost-improvement strategies that have been used in the private sector. Expanded authority through the IPAB would enable these strategies to be implemented more quickly and comprehensively, again helping to slow cost growth. All of these efforts will slow the rate of increase in health care spending.

The problem is little of this was implemented. Costs still continue to rise. I'm not sure what the point of arguing over about my imprecise wording has to do with the US is paying much more in medical costs, and Obamacare did nothing to stop those cost increases other than reducing costs paid by the uninsured who not insured. It seems like a deflection to me.

 
×
subscribe Verify your student status
See Subscription Benefits
Trial only available to users who have never subscribed or participated in a previous trial.