From an infamous, leaked, 2005 Citigroup memo, declaring the U.S. the world’s leading plutonomy:
[T]he top 1% of households in the U.S., (about 1 million households) accounted for about 20% of overall U.S. income in 2000, slightly smaller than the share of incme of the bottom 60% of households put together. That’s about 1 million households compared with 60 million households, both with similar slices of the income pie! Clearly, the analysis of the top 1% of U.S. households is paramount. The usual analysis of the “average” U.S. consumer is flawed from the start. To continue with the U.S., the top 1% of households also account for 33% of net worth, greater than the bottom 90% of households put together. It gets better (or worse, depending on your political stripe) — the top 1% of households account for 40% of financial net worth, more than the bottom 95% of households put together.
The gist of Citigroup’s analysis is that its clients should invest in the type of things that the top 1% consume — “toys for the wealthy” — because economically, the rest of us don’t really matter.
In a plutonomy there is no such animal as “the U.S. consumer” or the “U.K. consumer”, or indeed the “Russian consumer”. There are rich consumers, few in number, but disproportionate in the gigantic slice of income and consumption they take. There are the rest, the “non-rich”, the multitudinous many, but only accounting for surprisingly small bites of the national pie.
Likewise, there is no such thing as a “Washington taxpayer” either.
On average, Washington is a relatively low tax state, ranking only 35th nationally as a percentage of personal income, even according to the conservative Tax Foundation. But due to the highly regressive nature of our sales tax reliant tax structure — the most regressive in the nation — this burden is distributed incredibly unevenly, with the bottom 20% of households, those earning less than $20,000 a year, paying an average of 17.3% of their income in state and local taxes, while the top 1% of households, those earning over $537,000 a year, pay only 2.6%.
This is, of course, class warfare, and as billionaire investor Warren Buffet is famous for saying, his class is winning. And his is the class who the editors at the Seattle Times defend.
Our good friends and fellow readers on the right always like to point out that the top 1% of the wage earners pay a disproportionate share of the taxes.
But for some reason the fact that they make an equally disproportionate share of the income and own and even greater share of the wealth never comes up.
Nor does the fact that they enjoy a disproportionate share of the economic benefit of the infra structure and services the government provides with their tax dollars.
They dream of that day when “Atlas” will shrug and just stop paying for all those government goods and services, not realizing that the resulting chaos and social disorder will also hurt them and their economic interests in a similarly disproportionate manner.
So, I’m sure you’d be in favor of Washington having a 12% for incomes > 20k flat tax with no sales tax, right? The rich would pay 6x more than they do now, and the poor would get a serious tax break.
During the late 1940’s and early 1950’s, there were an enormous number of small three-bedroom ramblers built across the country. They were built to market to the hundreds of thousands of returning G.I.s, who’s mortgages were insured by the federal government but which were limited in amount (no need to subsidize those who could afford a house anyway).
If you want to buy a similar house now (new construction), good luck. Developers have increasingly moved toward building and selling “McMansions”, simply because they can make more money per lot in that fashion.
Why should we care? Because anytime resources are shifted in favor of a specific market, it makes it more expensive for everyone else. The price of McMansion items – upscale stonework, granite countertops, etc., will go down as more suppliers and contractors are drawn into that market. This leaves less vendors and contractors in the low-end markets, and the reverse application of the economy of scale will force those prices to rise.
So not only do the high income people get to buy bigger houses, but eventually they pay less for them, whereas everyone else pays more than before for significantly less house.
This may be basic market forces at work, but note that it has a public-policy cause, and a social cost. The public-policy cause is a system which rewards those who actually produce the least amount of product or service – investors – to have the lowest tax rates, thereby incrasing the gap between them and the working Americans. The social cost we have already seen: most middle-income families have two working parents, and are heavily indebted and only a paycheck away from homelessness or bankruptcy, and the cost of housing increases the homeless population.
Goldy, not that I don’t trust you, but where do the 17.3% and 2.6% tax figures come from? Do they include property taxes, or is it just sales tax? I don’t know how you could spend 17.3% of your income on sales tax, since the tax in Seattle is approximately 10%.
sdstarr @4,
Oops. Forgot to include the link to “Who Pays?” study from the Institute on Taxation and Economic Policy. It’s on total state and local taxes… property, general sales, excise (gas, alcohol, tobacco, etc.) and the pass on to consumers of the sales and excise taxes on businesses.
When the super-rich finish with destroying the American social contract they’ll probably be quite surprised to find their throats slit in the dark of night by those they screwed. heh- Like they think they can hide in their gated, walled off communities.
Hey, Goldy, I’ll give you $100 to ban Mr. Klynical for being too fucking stupid to post here. You want more? Make a counter offer.
My computer can’t open the Glenn Beck thread, so I’m posting my comments for that thread here.
Where do trolls like Klown get the gall to demand civility from liberals while they continue to stamp and cheer for incendiaries like Beck?
Reid Pledges Filibuster Reform
Majority Leader Harry Reid said today the filibuster has been “abused like the spitball in baseball and the four-corner offense in basketball,” and the next Congress will address filibuster reform. Sen. Charles Schumer plans to begin hearings on filibuster reform next month, Politics Daily reports.
http://www.politicsdaily.com/2.....er-reform/
Poll: Democrat Leads Colorado Governor Race
“A new poll of the Colorado governor’s race between Democrat John Hickenlooper, Denver’s mayor, and former Republican Rep. Scott McInnis has an entirely different result than one released Monday by Rasmussen Reports. While Rasmussen had McInnis edging ahead by a 48 percent to 42 percent margin, Public Policy Polling says its survey has Hickenlooper ahead by 50 percent to 39 percent, with 11 percent undecided.”
http://www.politicsdaily.com/2.....r-governo/
Crist’s Troubles Boost Democrats In Florida
A new poll shows GOP Gov. Charlie Crist losing Florida’s U.S. Senate race regardless of whether he runs as a Republican, independent, or Democrat. The pollster said, “Marco Rubio’s rise has given Democrats a much better chance to win this race than if Crist was still the GOP frontrunner.”
http://www.politicsdaily.com/2.....ll-behind/
N.H. Senate Seat Looks To Stay In GOP Hands
A Rasmussen poll indicates two of the three GOP primary contenders to succeed retiring Sen. Judd Gregg (R-NH) would beat Democratic Rep. Paul Hodes if the election were held today. Of course, the election is still several months away, and Rasmussen is … well … Rasmussen.
http://www.politicsdaily.com/2.....10-points/
Busheviks Lied To British Allies About Torture
The former head of MI5 says the U.S. lied to her country about using torture on terror suspects, AOL News reports.
“The Americans were very keen that people like us did not discover what they were doing,” Eliza Manningham-Buller said during a lecture on intelligence gathering at the Houses of Parliament. … [She] said that in 2002 and 2003 she asked her colleagues how the Americans were extracting so much information from [Khalid Sheikh] Mohammed …. ‘I said to my staff, ‘Why is he talking?’ because our experience of Irish prisoners, Irish terrorists, was that they never said anything,’ she said. ‘They said, ‘Well, the Americans say he is very proud of his achievements when questioned about it.’ It wasn’t actually until after I retired that I read that, in fact, he had been waterboarded 160 times.’
“‘Nothing … justifies torturing people,’ she said.”
http://www.aolnews.com/world/a.....s/19391008
This concludes Roger Rabbit’s posting in the Glenn Beck thread, and Roger Rabbit’s posting in the high earners tax thread now resumes.
New Release: ‘Free Rider’
Remember the movie “Easy Rider”? Well, this is the sequel, and it’s called “Free Rider”, and no, it’s not about hippies on chopper bikes.
It’s about a very rich guy named Thomas Stewart who lived in Washington for 40 years while piling up his fortune and paying no state income taxes.
Then — presciently — Stewart moved to Arizona to avoid paying inheritance taxes, too.
Although Stewart objected to paying income or inheritance taxes, he gave plenty of money to rightwing causes. For years, he was one of Washington’s biggest GOP donors.
Then, he died. On Feb. 14, his private helicopter augured in, and Stewart and his wife and daughter were issued their angel wings.
It’s almost as if he planned it. Hey, I’m not sayin’ he did, it’s just eerie how that worked, that’s all.
@1 “not realizing that the resulting chaos and social disorder will also hurt them and their economic interests in a similarly disproportionate manner”
For a long time, it has appeared they also didn’t realize that slashing jobs and wages would hurt their customers, but now we know the real explanation: They believe ordinary wage earners and consumers simply don’t count.
Revisionist Gettysburg Address: “Of the 1%, by the 1%, for the 1%, and the 99% be damned.”
@13
And by then whatever he said was just a bunch of gibberish. We gained zero accurate intelligence from water-boarding.
@17 What we do know now, though, is that rightwing claims that so-called “high value” detainees like Khalid cracked within 30 seconds under waterboarding were a crock.
@18
We’ve pretty much determined that the right-wing’s claims are a crock.
Oops, #19 should read:
We’ve pretty much determined that all the right-wing’s claims are a crock.
@5 The percentages in this chart don’t jibe with my situation. Using the IRS website sales tax deduction calculator, I get about 60% of the deduction I should according to the chart; and I pay more than twice as much property tax as the chart indicates.
“The political consensus may be that President Barack Obama’s handling of the economy has been weak. The judgment of money in all its forms has been overwhelmingly positive … the benchmark Standard & Poor’s 500 Index has risen … more than 41 percent since Obama took office. Credit spreads have narrowed. Commodity prices have surged. Housing prices have stabilized.
“‘We’ve had a phenomenal run in asset classes across the board,’ said Dan Greenhaus, chief economic strategist for Miller Tabak & Co. in New York. ‘If he was a Republican, we would hear a never-ending drumbeat of news stories about markets voting in favor of the president.'” — Business Week
http://www.businessweek.com/ne.....tocks.html
Roger Rabbit Commentary @22: As a young bunny, I learned the saying, “Give credit where credit is due.” It expresses a simple, yet profound, ethical notion: You don’t steal credit for others’ accomplishments, and you give credit to those who earn it.
But Republicans are not ethical, and they will neither accept the blame they deserve for the collapse of the economy, nor acknowledge Obama’s success in saving us from a worse disaster. And we surely can expect that, when recovery finally comes, they will pat themselves on the back and claim they deserve credit for it.
Why would anyone vote for people like these?
Factoid: Since President Obama took office, monthly job losses have declined 95% (from 779,000 to 36,000), corporate profits have risen 180%, the S&P 500 index is up 41%, commodity prices are up 32%, the dollar has strengthened 8%, and housing prices have firmed.
Roger Rabbit Commentary: And Republicans dare to call him a failure. How stupid can they be?
Source of data: article linked @22
Re 24
And the specific policy steps Mr. Obama took to achieve those results would be?
The economy cycles. It just does. No government manipulation will stop this. No pretty economic theory applied by either side does either.
Poor government policy can be the trigger, and good policy a way to ease the symptoms until the economy recovers. But I have yet to hear anyone tell me what Clinton did specifically to deserve his adulation for the good economy on his watch, or Bush to deserve sole blame for the problems on his.
Please note, I’m not saying that Bush laissez faire policies didn’t worsen the situation. But I see little blame for Barney Frank, who headed the Banking Committee. At least once he hounded banks to make loans they didn’t want to because they were too high a risk. He thought he was serving social justice, but I hear a deafening silence on the left condemning his lack of oversight.
Most realists knew the economy would likely recover during Obamas’ presidency and that he would get the credit for that. I’d just like to hear one person tell me 4 specific things this man did to revive the economy, and back it up with real evidence. Or 4 things Bush did as the executive to destroy the economy, with the same proviso.
As for the topic in hand, so what?
Advertising targets women often. This reflects the reality that in most households women make the big ticket decisions. Why else would any man ever drive a mini van? So investment banks targeted those with money to invest. And?
Yes, a plutocracy is a threat to the republic. And yes tax policy can seem like a way to alleviate the threat. But it assumes the folks who obtained all that wealth have the brains of an average jellyfish. Do you folks really think these people won’t find a way to pass these taxes back to you? Really? I mean, that flies in the face of everything we know about how business behaves.
And anyway, tax policy isn’t a means to obtain social justice. It is a means to pay for government. If it becomes the former it becomes as much a threat to the republic as the plutocrats themselves.
Re 19
Trenchant point. Or jingoism. Oh yeah, that’s what I meant.
Side note of no relevance to the topic-
One of my favorite authors once referred to the mini van as “Flash Gordons bread truck.”
@25 “And the specific policy steps Mr. Obama took to achieve those results would be?”
If you don’t already know the answer to this, why should I spell it out to you? I’m not going to indulge you. You’ve posted on this blog that you have a college degree. I’ll take your word for it. Now do your homework.
If you click on the link I provided in #22 and read the article, you’ll find the following quote:
“You have to give them — along with the Federal Reserve — a lot of credit,” said Joseph Carson, director of economic research at AllianceBernstein LP in New York.
I’ll leave it to the readers of this blog to judge for themselves whether they should listen to Mr. Carson or you.
“The economy cycles. It just does. No government manipulation will stop this. No pretty economic theory applied by either side does either. Poor government policy can be the trigger, and good policy a way to ease the symptoms until the economy recovers.”
Well, I’ll tell you what I believe. The economy doesn’t “just” cycle, like some untamed force of nature (see lightning, tornadoes, earthquakes, etc.). A capitalist market economy does a number of things — it cycles, it generates excesses, it goes off the tracks if left alone. I believe policy mistakes in 1929 and 1930 turned an ordinary recession into a devastating depression, and the Bush/Obama and Bernanke policies in 2008 and 2009 kept this recession from becoming one. In other words, it does make a difference — a huge difference — what government does, or doesn’t do.
You seem to believe otherwise. Some very smart and knowledgeable historians and economists, through their writings, convinced me you’re wrong. The situation is somewhat analogous to a runaway Toyota — you can be passive and let it run its course (until you’re dead), or you can take proactive action to stop it, whether that involves putting it into a guardrail or turning off the ignition or calling 911 and having a police cruiser bring you to a halt. In a nutshell, I don’t believe people who believe as you do should occupy important policy positions that can affect our economy. That’s a big reason why I don’t vote for Republicans anymore — they’re wrong, and the ordinary people of our country can’t afford the consequences of their misplaced beliefs and policy mistakes.
Of course, I can’t begin to argue the case against you in this comment. Making that case would require at least a book. There isn’t enough space here for that. The case I’m making here is simply that Obama’s policies have resulted in the numbers I posted @24. I think everyone reading this comment understands that it wouldn’t make any difference if I posted an encyclopedia of economic statistics and explanations; your answer would still be the same — because you’re a stubborn, obtuse, closed-minded ideologue.
eidt to #29: In a nutshell, I don’t think people who believe the government should remain passive during economic crisis should be allowed to occupy important policy positions that can affect our economy.
Bush and Obama did the right thing by bailing out the banking system. If Congress passes Obama’s proposed 10-year, $119 billion bank tax, the bailout will cost taxpayers nothing — the best bargain Americans ever got.
By contrast, in 1930, Hoover sat on his hands as banks failed. He let market forces run riot, and they did so with a vengeance. FDR’s intervention, upon taking office, halted the cascading collapse of the banking system within a few weeks.
Bernanke’s cash infusions into the banking system and economy headed off a disastrous deflationary spiral. Panicked investors, businesses, and individuals pulled trillions of dollars out of circulation, causing a drastic and rapid contraction of the money supply of the sort that feeds on itself. The Federal Reserve’s cash infusions partially offset this money suppy shrinkage, which prevented an even deeper plunge in economic activity.
Nearly all reputable economists agree Obama’s stimulus spending helped brake the econopmic slide and job losses. Those who criticized the stimulus, criticized it as too small.
Obama’s other policies — saving AIG and the auto companies, expanding FDIC insurance and extending depositor protection to money market funds, the home purchase tax credit and “cash for clunkers” program, financial assistance to states, and so on, also helped to stabilize the economy and financial markets, end the panic, and restore consumer and investor confidence. A few of his initiatives, such as the foreclosure prevention program, were less effective but not all of FDR’s ideas worked, either. In a crisis, you throw the whole spaghetti bowl at the wall to see what sticks.
Meanwhile, stupid teabaggers demonstrate in the streets against deficits, when there’s no inflation but prices and wages are stilling falling and the threat of deflation still exists, and demand the U.S. go back on the gold standard — a suicidal policy that was a leading cause of the Great Depression.
Every American voter has to choose between people who know what they’re talking about and those who don’t, between smart people and stupid people, between the right policies and disastrously wrong policies. The data I posted at #22 speak for themselves. Our policymakers are on the right track. They’ve made the right decisions. The situation has turned around and the economy is now on the road to recovery. The people should vote for them, not the howling monkeys in the streets.
A different way to look at the data cited in the “Who Pays” link is by amount paid.
I’ve calculated the dollar amount of taxes paid by each WA income group referenced. Results:
Tax Group – Taxes Paid
Lowest 20% – $1,903
Second 20% – $3,581
Middle 20% – $5,389
Fourth 20% – $6,943
Next 15% – $8,851
Next 4% – $13,846
Top 1% – $46,670
@31
You’ve routinely said that american taxpayers are going to make a profit on their TARP “investments”.
Wanna bet?
@25: The thing I love about Lost is how totally ignorant a person can be and also be so unaware of what a fool they are making of themselves. Here are some totally foolish statements made by someone so ignorant, they refuse to even look at the obvious facts and are oblivious to how stooopid they appear to others:
Umm, under Clinton,
Clinton pushed through tax increases on the rich and gave cuts to the middle class. Republicans tried to block this and claimed it would ruin the economy….but we had the best economic performance in 20 years during this time and we cut the deficit and got three years of surpluses (something Reagan and Bush never did).
And here is another whopper from and ignorant Bush supporter:
Lost fails to understand why
.
Umm, let me explain a few things:
1. Bush wasted over 1 trillion and countless American lives on an unnecessary war in Iraq. That alone (and the fact he lied about the “danger” that Iraq was to us) should make Bush the worstr President ever.
2. Bush supported the deregulation of trhe banking industry and the government oversight on his watch was non-exsitent as the banking industry cheated, lied and gambled our economy away.
3. Bush and his attorney general politicized our justice system to a degree never before seen….and fired State Attoney generals for political reasons. This was a blatant attempt to politicize the justice system…and one of the worst abuses of federal power in the history of the US.
I could go on about the Bush failures…..but really, where have you been? Have you not paid attention or are you so partisan or obtuse that you missed all that?
I am beginning to doubt if you even have the ability to think clearly or understand basic facts.
@25: If you want information on the banking crisis – try looking up who wrote the laws on the credit default swap (the main problem in the the housing crisis)….it was Phil Gramm.
The redlining bills that you are referring to (the Barney Frank oblique reference) contributed virtually nothing to the housing crisis…so your reference to Barney Frank is baseless and a red herring.
Try getting the facts on the crisis before spoouting off on things you know nothing about. It just makes you look even more ignorant.
CDS’s played a huge part in the banking crisis and the resulting taxpayer bailout of firms involved with CDS instruments.
Really THE DUMB BUNNY? Seems the CBO thinks otherwise…
I’ll leave it to the readers of this blog to judge for themselves whether they should listen to the CBO or you.
Unkl Witz @ 1–
Excessively tax success seems to be your message.
We are purchasing Services.
Why should rich folks pay more for the same services less fortunate folks use??
Should there be different Grocery Prices based on your income?
Where does it stop??
It should have never started.
How is the l’il messiah of wealth redistribution and free stuff with massive deficit spending doing these days??
Thursday, March 11, 2010
Not so good, is he?
Blowing a +32 rating in one year.
Why??
Socialist, class warfare ideology that makes things worse.
Lot’s of folks with Capital are hanging on to it. Can’t blame them with President Obam-Mao on the warpath against successful people.
I think that the deficit will be much worse than Obam-Mao’s folks are predicting. That tax collections will be waaaaaaay below what is projected…adding to the deficit.
Time will tell.
@39 Geez, President Obama is still twice as popular as Bush. That obviously chaps your sorry ass to no end, seeing as how you were that abject failure’s biggest HA cheerleader.
Help me out here, KLOWN, what was Bush’s approval rating when he slinked out of office?
@38 “Should there be different Grocery Prices based on your income?”
Well, there are. Just go into a ghetto grocery store and compare prices there with those in a suburban store of the same corporate chain and you’ll see what I mean. It’s a form of backwards communism — “to each according to his greed, from each regardless of his need.” Gouging the poor was big business for Republican profiteers long before GOP-voting subprime mortgage-loan hucksters showed up.
you will also notice the proliferation of things like food stamps, etc in the “ghetto grocery store”(as you put it),so I kinda doubt anybody is getting gouged – accept the middle class US taxpayer
41 – You dodged the question. As you know, unlike taxes, grocery prices are set by the store – not the state government.
@43 I take it, then, you have no problem with the ethics of a business that charges high prices in poor areas because the people living there can’t afford to drive to the suburbs where there’s more competition? Yeah, I see what you mean, capitalism is all about making as much money as possible regardless of whether people are going hungry … what a wonderful system for our fellow citizens.
@44 – An anecdotal for ya: I live in what is probably called a “nice” neighborhood. 2 blocks from my house is a grocery store. The people that go to that store live in the neighborhood and are most likely “well off”. The corner store’s prices are more expensive than the suburban chains – just like the stores your talking about “in poor areas”.
Does that blow your mind? A grocery store is charging rich people high prices!?
Are you suggestion that government should force grocery stores to price their goods based on the demographics/income of the area?