Communism and the Civil Rights Movement

[Bootstrap]

Most prosperous modern economies are busily concentrating wealth in the 0.01%, whilst everyone else gets poorer.

I agree - that's the real problem. And if you want to know what is causing it, it's helpful to see how it evolved over time.



Since the 1980s, our policies have largely been aimed at making sure the rich and powerful are richer and more powerful, reducing their taxes and accountability and regulations that would protect the rest of us from them. They are almost worshiped as "job creators". Between 1945 and 1980, we could say "a rising tide lifts all boats", but now productivity gains benefit the wealthy disproportionately:

[Bootstrap]

Most prosperous modern economies are busily concentrating wealth in the 0.01%, whilst everyone else gets poorer.

I agree - that's the real problem. And if you want to know what is causing it, it's helpful to see how it evolved over time.

Two more graphs on this. Most people seem to think the 1950s was a fairly ideal time in the United States, few would say we were Communists back then.

What did tax rates look like back in the 1950s? This article proposes taking our tax rates back to the 1950s tax rates. This graph shows how that would change our current rates.



The article also has a useful breakdown of the total tax burden under the current system. If you look at total taxation, we have reached the point that the super wealthy pay the lowest tax rate. I think that means they have better lobbyists and better marketing than you and I do.

[Josh]

Most prosperous modern economies are busily concentrating wealth in the 0.01%, whilst everyone else gets poorer.

I agree - that's the real problem. And if you want to know what is causing it, it's helpful to see how it evolved over time.

Two more graphs on this. Most people seem to think the 1950s was a fairly ideal time in the United States, few would say we were Communists back then.

What did tax rates look like back in the 1950s? This article proposes taking our tax rates back to the 1950s tax rates. This graph shows how that would change our current rates.



The article also has a useful breakdown of the total tax burden under the current system. If you look at total taxation, we have reached the point that the super wealthy pay the lowest tax rate. I think that means they have better lobbyists and better marketing than you and I do.

I have not been arguing against higher tax rates.

I do argue against higher taxes on the middle class whilst the rich continue to (legally) evade higher taxes and continue to get richer and richer. We used to do something about wealth concentration in this country; nowadays both parties throw up their hands right before hosting another donor fundraiser from those same rich people.

Amazon refused to pay sales taxes and got away with it for a decade. After finally crushing all competition and local retailers, they now impose their own 12% tax on independent sellers, and we all know you basically can’t do business if you don’t sell on Amazon. And there is no political will to either break up Amazon, or else regulate the ridiculous fees they charge, or regulate how poorly they treat their workers, or do something about their “independent contractor” drivers who are required to break traffic laws in order to meet their targets for how fast they deliver packages.

The ultimate end is a third world country. We are well on our way to that destination.

[temporal1]

.. and we all know you basically can’t do business if you don’t sell on Amazon. ..

the pandemic response has contributed. i shudder to witness.

.. The ultimate end is a third world country. We are well on our way to that destination.

i’ve given up. i now view the U.S. as just another hybrid SA country. i’m pretty confident the cartels are in everything.
it’s just the idea is so unwanted, “we deceive ourselves.” no, i do not see U.S. politicians that have the grit to resist.
it takes vision and commitment. i see easy sell-outs everywhere. some have gotten caught. there have been indicators over years.

it explains bizarre inexplicable policies.

big gov handouts are useful to buy people out, keep them quiet, while they finish it off.

i hope i’m wrong.

[JimFoxvog]

Two more graphs on this.
...
The article also has a useful breakdown of the total tax burden under the current system. If you look at total taxation, we have reached the point that the super wealthy pay the lowest tax rate. I think that means they have better lobbyists and better marketing than you and I do.

It surprises me that the income tax on the lowest brackets is this big. The Earned Income Credit makes the income tax negative for low-income families with children; it can often be a significant portion of a family's income. Maybe they didn't include it?

[Josh]

Two more graphs on this.
...
The article also has a useful breakdown of the total tax burden under the current system. If you look at total taxation, we have reached the point that the super wealthy pay the lowest tax rate. I think that means they have better lobbyists and better marketing than you and I do.

It surprises me that the income tax on the lowest brackets is this big. The Earned Income Credit makes the income tax negative for low-income families with children; it can often be a significant portion of a family's income. Maybe they didn't include it?

It’s not included, and also doesn’t include very major changes made with regards to stimulus payments, child tax credit refunds, unemployment benefits, and forgivable PPP loans. For 2020 and 2021, the tax rate on the lower brackets is very low and often negative.

But if there is rampant price inflation (and eventual wage inflation), that won’t matter when a fast food worker is making $200,000 a year but their rent costs $10,000 a month.

There is a lot of talk of raising taxes on the super-wealthy but nothing actually happening; some obvious changes would be the changing carried interest to ordinary income, levying capital gains on unrealised profits of easily traded securities, and treating profits from “short sales” as ordinary income instead of capital gains.

[ken_sylvania]

Two more graphs on this.
...
The article also has a useful breakdown of the total tax burden under the current system. If you look at total taxation, we have reached the point that the super wealthy pay the lowest tax rate. I think that means they have better lobbyists and better marketing than you and I do.

It surprises me that the income tax on the lowest brackets is this big. The Earned Income Credit makes the income tax negative for low-income families with children; it can often be a significant portion of a family's income. Maybe they didn't include it?

It would have been good journalism for them to have explained how they came up with those numbers. For instance, what is included in "Payroll Taxes"? Federal, state and local income tax withholding shouldn't be classified as payroll taxes - they would be income taxes. I have to assume that they are referring to FICA taxes - if that is the case, then the figures for low income folk are just plain wrong. Maximum FICA rate is 7.64%, and it's not charged on tax-free benefits so it should be slightly less than that on average.

[Josh]

A "fact check" or infograph is not complete if it doesn't contain hidden bias to support the author's pre-conceived beliefs. If I wanted to advocate for lower taxes (which I don't), I could sit here and embed images from Cato, just like Bootstrap does with stuff from the New York Times. The idea that there is unbiased "information" is a silly one.

Back to the topic of taxation, total tax burden needs to include things like sales taxes paid, various occupational and licencing taxes, travel taxes (these can get as high as 50%), and property tax (paid indirectly by renters, and also paid indirectly by people who use a business that owns any land). Rich people tend to be in the business of keeping their money, not wasting it, and attempts to raise taxes on them usually result in shifting tax burden to other people (like consumers) to ultimately pay it.

[Ken]

Two more graphs on this.
...
The article also has a useful breakdown of the total tax burden under the current system. If you look at total taxation, we have reached the point that the super wealthy pay the lowest tax rate. I think that means they have better lobbyists and better marketing than you and I do.

It surprises me that the income tax on the lowest brackets is this big. The Earned Income Credit makes the income tax negative for low-income families with children; it can often be a significant portion of a family's income. Maybe they didn't include it?

It would have been good journalism for them to have explained how they came up with those numbers. For instance, what is included in "Payroll Taxes"? Federal, state and local income tax withholding shouldn't be classified as payroll taxes - they would be income taxes. I have to assume that they are referring to FICA taxes - if that is the case, then the figures for low income folk are just plain wrong. Maximum FICA rate is 7.64%, and it's not charged on tax-free benefits so it should be slightly less than that on average.

payroll taxes are commonly understood to be social security, Medicare, unemployment insurance, any any other state line item deductions from your paycheck that aren't state or federal income tax.

As for income tax on the lower tax brackets? It looks about right. That is the light gray bar on the far right. A lot of people don't claim the earned income tax credit and a lot of low income earners are simply part time workers like college students and retirees who aren't necessarily heads of households. For example, my daughter worked her way through college part time but never got the EITC because she was considered a dependent because her parents were helping with her tuition.

[ken_sylvania]

It surprises me that the income tax on the lowest brackets is this big. The Earned Income Credit makes the income tax negative for low-income families with children; it can often be a significant portion of a family's income. Maybe they didn't include it?

It would have been good journalism for them to have explained how they came up with those numbers. For instance, what is included in "Payroll Taxes"? Federal, state and local income tax withholding shouldn't be classified as payroll taxes - they would be income taxes. I have to assume that they are referring to FICA taxes - if that is the case, then the figures for low income folk are just plain wrong. Maximum FICA rate is 7.64%, and it's not charged on tax-free benefits so it should be slightly less than that on average.

payroll taxes are commonly understood to be social security, Medicare, unemployment insurance, any any other state line item deductions from your paycheck that aren't state or federal income tax.

11.2% is hard to explain even including all taxes other than state, federal and local income taxes. I'm familiar with the deductions for the high tax states on the east coast, and they don't get anywhere close to that.