Wednesday, October 30, 2013

The Wealthy Are Undertaxed, And The Economy Suffers

The Dow hits another record high. Where are all the jobs?
News flash to reporters: the stock market index is not the economy

The economy for many people in this country is one where work is hard to find, real wages have shrunk, and robust benefits and job security are tall tales to regale the young with. 

Young people burdened with crushing student loan burdens are facing futures with scant opportunity.  And at the root if all of it are policies that favor the accumulation of wealth among the already wealthy.  The relentless growth of income and wealth inequality has been largely driven by tax policy.

Where is the leadership, Mr. President?  I understand there is a recalcitrant, obstructionist GOP befouling the people's House.  But you're not even making the case.  And it may be water under the bridge, but your initial extension of the Bush tax cuts only exacerbated the problems we face.  It was bad politics and even worse policy.
It is a fact that taxes on the wealthy are at near historic lows, and that the share of the wealth controlled by the rich is at historic highs. It is a fact that corporate profits are at record highs, as is the stock market. Business, and big business in particular, is doing very, very well. Yet unemployment remains high, wages are stagnant, economic mobility is weak and the middle class is shrinking. Corporations are sitting on vast accumulated wealth, but are not investing that wealth in human capital that advances broad-based prosperity. We do, on the other hand, have plenty of evidence that high levels of income inequality are very damaging to an economy. We have plenty of evidence that corporations are unwilling to invest in new products because they're not certain that consumers will be able to afford them. Moreover, we know that unemployment was lower and the nation more prosperous when taxes on the wealthy were higher, when regulations on Wall Street were more stringent, and when organized labor was more powerful.
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2 comments:

Anonymous said...

The reporter who wrote this article knows little about economics. Rising income for the rich and tax policy are two different things. Income for the rich is going up independent of tax policy. Income going up for the rich is due to more oportunities to get rich due to the advent of new technologies and bussiness globalization. Income for middle class people is not going up, because they have to compete with workers all over the world. And, as they compete with workers over seas, our Federal government allows unlimitted imagration so as to create an over supply of labor in the US, thus putting downward pressure on American wages. The fact, that after all of this, rich people enjoy lower taxes, only lets them keep more of the money they have made. The lower taxes didn't create the growing income inequality.

Gary Reilly said...

I'll let your overwhelming ignorance speak for itself.