inequality club
TRANSCRIPT
Inequality and What to do About It
Income
0
10000
20000
30000
40000
50000
60000
70000
80000
90000
0 20 40 60 80 100
Inco
me
Le
vel
Percent of Population
Income Level Versus % of Population-2007
Wages Flat
Wages & Corporate ProfitsWages Profits
Percent
Cap gains %
Conclusions on Income• Income distribution counter to a Competitive
Free Enterprise, Democratic Society
• Stifles Domestic Economic Growth
-Top 1% Earn the Same as Bottom 55%($1 trillion a year)
-2/3 of Population with less than $45,000 Income
- Little $ for New Spending To Spur Demand & Growth
• The $ Resources to Fix the Economy are with the 1% and large Corporations($1.5 trillion a year)
Taxes
Income Share vs. Federal Income Tax Share
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
35.00%
40.00%
Top 0.1% Top 1% Between 1 &5% Between 5% & 10% Between 10% & 25% Between 25% & 50% Bottom 50%
Income Share
Federal Income Tax Share
Regressive Effect of
Percent of Income Paid for All Taxes
Payroll, Real Estate and Sales Taxes Make Total Tax Rates Similar for Middle Class and Wealthy
Total = all federal(income and payroll) ,state, and local taxes.
Conclusions on Taxes
• Federal Income Tax Alone Still Somewhat Progressive –But Not Enough
• Regressive(same % for all income levels) payroll, sales, and real estate taxes create similar overall tax rates for the Middle Class and the Wealthy.
• Need to address all taxation, not just federal income tax .
Wealth
Greater Equality-Economic
• Grow Economy /Restore 17 million Jobs• Greater Distributed Benefit of Economic
Growth• Tax Reform
- Defense vs. Social Needs- Wealthy, Middle , Low- Corporate, Individual
-400,000
-200,000
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
Government Offshored
Job Gain and Loss in 2010
Private Sector
Business Demand, 34
Org. Changes, 8
Financial Issues, 7Government
Regulations, 0.3
Seasonal, 24
Reasons Cited by business for Extended, Larger Layoffs
Other
How Do You Create 17 Million Jobs?
• Costs About $1.5 Trillion ($1500 billion) A Year• Who Has That?
-Government; $200 billion a year would be a feat
- Large Corporations; Holding 1.8T, Earning 1.5T a Year( after taxes)
- Wealthiest 1%; Earning $1.0 T a year(after taxes)
How to Move the $ to a U.S. Worker
• Tax Breaks for Wealthy Hasn’t Worked
• Tax the Wealthy, Govt. Pays the Employee
- Ok for Public Services,
- But for rest, not efficient; $ In from private sector, thru government, backout to private sector.
- Most Job Loss in Private Sector
Getting the $ to a U.S. Worker
The Key: Get Corporations, 1% to Spend on U.S. Job Creating Activities
• Increase Tax Rates with Lower Rates for U.S. Job Investment.
-Credit for demand side- wages, profit sharing-Credit for supply side- new plant , hires
• End Tax Breaks for Facility/Job Outsourcing- Tax Income as Earned , not when “returned “ to U.S. - Limit Foreign Tax Credit; Remove U.S. Sales Income
from Calculation-Offshore Tax Haven Abuse; $100 Billion/Year
Grow Economy
• American Jobs Act-near term• Change Corporate, Upper End Tax Rates to Spur
U.S. Job Investment• Long Term Infrastructure Work; Derivatives Tax• Change Anti-Competitive Laws and Regulations• Improve Education: public school capability and
funding methods, preschool, community colleges, college loans, grants
• Research and Planning
With Distributed Benefit
• Increase Upper End Taxes (Income, Capital Gains, Estate)
- But Low Rates for U.S Job Creation
• Shore up Safety Net programs
• Progressive Wealth Tax - Beyond Real Estate
• State Income Taxes vs. Sales, Property Taxes
Distributed Benefit,con’d
• Positive Union Attitude
• Change Home Mortgage Formula(earlier loan principal payoff)
• Address Excessive health care charges-price and method
• Others?
Restoring Equality-Politically
Equality of Voting and Influence- Review of Voter/Voting Impediments;
---Registration; ID, Same day---Make Election day a National Holiday---Extend Early Voting, Absentee Voting
- Public Campaign Financing- Limits on Private Campaign Contributions;
Override Citizens United Case- Term Limits; Supreme Court, Congress
Political Equality-con’d
- Post-Election Term Employment Restrictions
- Lobbying Transparency
- Mass Media Reforms; Free Election Campaign Air Time, Fairness Doctrine, One Station for Free Public Air Time
- Independent State Commissions for Defining Congressional Districts
- Military Draft
- Others?
Conclusions• Income Inequality Contributing to
Poverty, Poor Education, Economic Stagnation
• Excessive Political Influence of the Wealthy Has kept the Status Quo
• No single answer to Job Creation and Reducing Inequality
• Many Initiatives/Projects to Undertake
• Public Appears Supportive
• But Who Will Do Them?