Wealth Distribution in the USA

awec

Charlie Rock wrote: »

This is wrong. As a % of income middle and lower earners pay the most tax (all taxes). The richer you get the less tax you pay proportionately and the more likely it is you will have income or wealth that is difficult or impossible to consider.

Also, unlike for the rich, the pay of lower and middle income earners all goes back into the system, primarily locally, which keeps the economy buoyant.

20% of a million is more than 40% of 50,000. The 1% pay more tax, and cost little.

The shortfall, in terms of actual monetary value that would be lost if we were to "get rid" (whatever that means) would have to be made up.

drumswan

Permabear wrote: »

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You still havent grown out of your Ayn Rand phase I see, how amusing.

A situation where the rich are allowed to get rich without hoovering up grossly disproportionate wealth at the expense of the vast majority of humans is preferable, despite your childish ideas.

Permabear

Permabear wrote: »

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It's only greedy to want to keep your own money, it's not greedy to demand someone else's.

K-9

Permabear wrote: »

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That's true enough, expectations have gone up, I'd say tied up with the explosion in advertising and credit.

If everything was cheap in the 1950s, why did people have so few possessions, comparatively speaking? The average American woman now owns 20 pairs of shoes and 7 handbags — something that would have been unheard of, except among the wealthy elites, back in 1950. Even poor people today have cars, televisions, washing machines, and smartphones. It's hardly an understatement to say that poor people in 1950 had sweet feck all.

They had fewer possessions because well, there were fewer things to own. I understand your point but why take the 50's? Go back another 50 years and a radio would be a luxury item, 50 years later not, same with your point about a television in the 50's, a basic now, a luxury then. As for washing machines and mobile phones, obviously with time technological advances make what was once luxury goods more and more accessible and affordable. I'd take that as a given, otherwise we might as well stop inventing stuff!

I take your point on shoes and spending on non essential stuff, but again credit was the big factor in the spending booms.

KyussBishop

Justifying large disparities in income/wealth distribution, is largely about people in management/CEO positions, taking a greater share of credit for the work of the people, who actually do the everyday work of running companies: The employees/workers.

A lot of the time, none of this is justified in terms of what is best for society overall, it is justified based on superficial moral arguments, that focus exclusively from the perspective of the owners/management of a company (omitting that of the workers, and of wider society).


The bigger picture, of what is best for society, is really what needs to be looked at - we see in real life (contrary to what the idealized theories say we should see), that when income inequality is allowed to grow so large, it has a lot of negative effects on the people at the lower end of the scale, and we see in real life, that the more wealth someone has, the more they can subvert the political and legal system in their favour (and there is no readily available solution to this - this kind of corruption has always existed, and likely always will - so the ability to gain this much power needs to be curtailed).

None of these bigger-picture issues get touched on by the simplistic management/owner-focused moral arguments that usually dominate these discussions, and usually these bigger issues get distracted away from, by leading the discussion back to those same moral arguments (without the poster stating, that they think those moral arguments, are more important than the bigger picture - something they would need to justify).

Karl Stein

Corporate status is a state granted privilege that is opt-in. If the people who make up the state wants to take an interest in how CEO pay relates to the average worker and CEO's don't like then they can STFU and opt-out of corporate status.

Permabear

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Permabear

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Karl Stein

awec wrote: »

The 1% pay more tax

No they don't. You don't get to use percentages to describe the 1% and then disregard what % of their income/wealth they pay comparatively.

and cost little.

False. The more you have the more the system serves you therefore the more it is in your interests the system is healthy.

The subjects of every state ought to contribute towards the support of the government, as nearly as possible, in proportion to their respective abilities, that is, in proportion to the revenue which they respectively enjoy under the protection of the state.

It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.

Adam Smith: Wealth Of Nations

awec

KyussBishop wrote: »

Justifying large disparities in income/wealth distribution, is largely about people in management/CEO positions, taking a greater share of credit for the work of the people, who actually do the everyday work of running companies: The employees/workers.

A lot of the time, none of this is justified in terms of what is best for society overall, it is justified based on superficial moral arguments, that focus exclusively from the perspective of the owners/management of a company (omitting that of the workers, and of wider society).


The bigger picture, of what is best for society, is really what needs to be looked at - we see in real life (contrary to what the idealized theories say we should see), that when income inequality is allowed to grow so large, it has a lot of negative effects on the people at the lower end of the scale, and we see in real life, that the more wealth someone has, the more they can subvert the political and legal system in their favour (and there is no readily available solution to this - this kind of corruption has always existed, and likely always will - so the ability to gain this much power needs to be curtailed).

None of these bigger-picture issues get touched on by the simplistic management/owner-focused moral arguments that usually dominate these discussions, and usually these bigger issues get distracted away from, by leading the discussion back to those same moral arguments (without the poster stating, that they think those moral arguments, are more important than the bigger picture - something they would need to justify).

See to be fair, this is rubbish.

awec

Charlie Rock wrote: »

No they don't. You don't get to use percentages to describe the 1% and then disregard what % of their income/wealth they pay comparatively.



False. The more you have the more the system serves you therefore the more it is in your interests the system is healthy.

Ok, the "elite" (the favourite buzz word of the mouthy left) pay more tax than the rest of us. We are getting into pedantics here.

People get too hung up on the portion of their wages. Whether they pay 40% or 20% the cash value is obviously greater.

And without a doubt, rich people cost the state less than those living heavily subsidised lifestyles.

Permabear

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swimming in a sea

Ugo Monye spacecraft experience wrote: »

I doubt it, we have a progressive tax system where the top 10% of earners are paying 60% of the tax

More you earn the more you pay

or

The harder you work the more you pay

Give me the USA's tax system any day where you don't get over taxed just because your talents are in demand.

awec

Permabear wrote: »

This post had been deleted.

The decision made by the average employee will involve what they want to have for their lunch that day.

The further you go up the chain, the more responsibility you have and the bigger risk your decisions will have. As such, the financial rewards are much greater to reflect this. The demand for the job is far greater the higher you go - even if you work less hours or whatever.

To dismiss it as the low level employees doing the actual work is such crap. That's one step away from the notion where if you don't come home from work sweating and tired then you haven't done any work at all.

There isn't exactly an abundance of people who have the skill set to be CEOs.

Karl Stein

Ok, the "elite" pay more tax than the rest of us.

In proportion to their income this is simply not true.

And without a doubt, rich people cost the state less than those living heavily subsidised lifestyles.

Again this is false. The more the system serves you the more you stand to lose from it's ill health.

The subjects of every state ought to contribute towards the support of the government, as nearly as possible, in proportion to their respective abilities, that is, in proportion to the revenue which they respectively enjoy under the protection of the state.

It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.

Adam Smith: Wealth Of Nations

It really is a chore to machete through the jungle of propaganda as regards these issues to reach the clearings.

KyussBishop

People are worse off today in terms of debt and employment - society has improved a lot over the decades (as we should expect it to, as wealth of real assets in society and technological advances accumulate - while economies function well, this is to be expected, not to be thankful merely for sharing any portion of the gains), but the ability to access a lot of the new benefits in society depend upon having a job and earning money.

The Net Worth (which is important, for factoring in private debt) of families in the US, seems to have fallen back again, to levels not-too-dissimilar to the 1950's:
http://retired.talkingpointsmemo.com/images/household-net-worth.png

Look at what's happened to the net worth of high earnings in recent decades:
http://www.econdataus.com/scf04net.jpg

Pretty stagnant for average folk, while increasing for the already wealthy.

donegal__road

Permabear wrote: »

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so that means that the boss gets over 300 times the average worker's salary? (by American logic, that is)

awec

Charlie Rock wrote: »

In proportion to their income this is simply not true.



Again this is false. The more the system serves you the more you stand to lose from it's ill health.



It really is a chore to machete through the jungle of propaganda as regards these issues to reach the clearings.

Why did you leave the bit out of my post about the portion of their income?

Why do people get so hung up on that?

And are you going to sit there and tell us that someone earning a million a year takes more cash from government coffers than someone on the dole, getting a medical card and various other allowances? Council homes, etc etc? What nonsense.

Karl Stein

awec wrote: »

The further you go up the chain, the more responsibility you have and the bigger risk your decisions will have.

*sigh* more turning reality inside-out.

State granted limited liability ensures that you can walk away from gross incompetence, up to and including mass manslaughter, as a rich person.

drumswan

Permabear wrote: »

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You inherit one usually.

awec

donegal__road wrote: »

so that means that the boss gets over 300 times the average worker's salary? (by American logic, that is)

Supply and demand.

Of all the workers in the USA, do you think the ratio of people with the skills to be CEOs against those who don't is greater than or less than 300:1 ?

I think ignorance is a big problem here. Too many people think being CEO is playing golf, flying around in your helicopter and going on dates with much younger but incredibly attractive women.

Even if a CEO works 1 hour a week, in that 1 hour he will have more impact on a business than the guy working 40 hours for the industry wage.

awec

Charlie Rock wrote: »

*sigh* more turning reality inside-out.

State granted limited liability ensures that you can walk away from gross incompetence, up to and including mass manslaughter, as a rich person.

That really doesn't address my point whatsoever.

*sigh* :rolleyes:

KyussBishop

awec wrote: »

See to be fair, this is rubbish.

Provide an argument.

One example, would be crediting the owners/managers/CEO's of a company with 'creating jobs', and using that as an argument for justifying excessive wages - the ability of a company to profit enough to create jobs, is vastly more down to the workers earning the profits for the company, which enable the creation of jobs.

The CEO's/managers should certainly be richly rewarded for their own unique skills, but not allowed to take disproportionate credit for the success of a company, beyond that of all the workers.

awec

KyussBishop wrote: »

Provide an argument.

One example, would be crediting the owners/managers/CEO's of a company with 'creating jobs', and using that as an argument for justifying excessive wages - the ability of a company to profit enough to create jobs, is vastly more down to the workers earning the profits for the company, which enable the creation of jobs.

The CEO's/managers should certainly be richly rewarded for their own unique skills, but not allowed to take disproportionate credit for the success of a company, beyond that of all the workers.

I have if you read the thread.

I haven't mentioned "creating jobs".

KyussBishop

Permabear wrote: »

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That's strange; I'm sure the company would just run itself without all of the workers then?

MRnotlob606

obamas my favourite socialist leader after lenin.

awec

KyussBishop wrote: »

That's strange; I'm sure the company would just run itself without all of the workers then?

So you're just going to deflect from the point at hand then?

That is completely unrelated to what he posted. You are missing the point, perhaps deliberately.

K-9

Permabear wrote:

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That begs the question, what are people spending 68% of their disposable income on when they've already paid the mortgage/rent, food, and bills?

Permabear wrote: »

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Well is it not more a case that interest costs are taking up a big chunk of income? People bought bigger houses and cars during the bubble, and they are paying for it now! As an example, those 20 pairs of shoes could well have been bought on credit, so really are they that better of?

So supply of goods was the constraint?

I was just making the point because you brought up televisions and smart phones. Incomes have increased but again I'd take that as a given as both left and right wing politics would agree on that as a basic belief. Food costs have come down, I'm a still bit doubtful on housing costs though!

Oh, I agree. My argument isn't specific to the 1950s. People are better off today, by any conceivable metric, than they ever have been before in history. Any effort to pretend otherwise is largely driven by nostalgia for a nonexistent golden age.

But again I'd take that as a given, people who lived in the 50's were better of than the 1900's. If we aren't advancing from 50 years ago something is wrong.

Karl Stein

awec wrote: »

That really doesn't address my point whatsoever.

Are you denying that CEO's are protected from poor decisions, up to and including mass manslaughter, by limited liability and other property and asset securing instruments?

Why do you think that the RCC hasn't been stripped of its assets and property here? Why? Because property rights are highly developed to the point where challenging them is deliberately frustrated even if you've been kept as a de-facto slave by the institution.

KyussBishop

awec wrote: »

The decision made by the average employee will involve what they want to have for their lunch that day.

The further you go up the chain, the more responsibility you have and the bigger risk your decisions will have. As such, the financial rewards are much greater to reflect this. The demand for the job is far greater the higher you go - even if you work less hours or whatever.

To dismiss it as the low level employees doing the actual work is such crap. That's one step away from the notion where if you don't come home from work sweating and tired then you haven't done any work at all.

There isn't exactly an abundance of people who have the skill set to be CEOs.

There isn't an abundance of people who have the opportunity to develop that skillset - don't pretend it is a meritocracy, it is a privileged position, that has very high barriers to entry (usually requiring an abundance of familial wealth to start off with).

Social mobility, the poor and middle classes working their way up to riches through business, is the exceptional/rare case, and only a relative few will be so lucky.