inequality club

27
Inequality and What to do About It [email protected]

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Page 1: Inequality club

Inequality and What to do About It

[email protected]

Page 2: Inequality club

Income

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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

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Wages Flat

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Wages & Corporate ProfitsWages Profits

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Percent

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Cap gains %

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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)

Page 9: Inequality club

Taxes

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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

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Regressive Effect of

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Percent of Income Paid for All Taxes

Payroll, Real Estate and Sales Taxes Make Total Tax Rates Similar for Middle Class and Wealthy

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Total = all federal(income and payroll) ,state, and local taxes.

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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 .

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Wealth

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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

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-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

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Business Demand, 34

Org. Changes, 8

Financial Issues, 7Government

Regulations, 0.3

Seasonal, 24

Reasons Cited by business for Extended, Larger Layoffs

Other

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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)

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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

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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

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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

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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

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Distributed Benefit,con’d

• Positive Union Attitude

• Change Home Mortgage Formula(earlier loan principal payoff)

• Address Excessive health care charges-price and method

• Others?

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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

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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?

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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?