Got a lot of blackberries? Then check out this recipe for Blackberry Mojito Fruit Leather.

I'm not a huge fan of fruit leathers, but this turned out super good! And, really, you can't go wrong with blackberries, mint and rum.

Tuesday, October 18, 2011

Why poor people don't want to tax rich people

I've been puzzling over this issue for a long time now. It doesn't make a whole lot of sense to me, but the gist of it is that many Americans who earn a median income down to the poverty level* defend vehemently the right of rich people to keep their vast sums rather than tax them at a higher rate past a certain earning point.

The most common argument is that those rich people work hard for their money and they should keep it. The same is said for the middle wage earner - they work hard for their money and they should keep it. But those poor folks aren't working hard for their money so we have no right to tax the middle class or the upper class at a higher rate than the poor. No redistribution of wealth, no sirree. That would be communism.

There's a funny statistic out there and, by funny, I don't mean humorous, but ironic. If you ask wage earners where they fall, invariably they respond the "middle class", regardless of the fact that they are closer to the poverty line. Even those in the top 5 percent of all earners refer to themselves as middle class.

I suspect this is an issue for those who are in the top 5% because they "feel" like they aren't wealthy. Especially when they compare themselves to the extravagant, flagrant wealth that exists in this country. Namely folks like Bill Gates, Oprah and the Kardashians.

But what's with the taxation thing? My theory is that Americans, poor and middle class, don't want to tax the rich at a higher rate because they themselves wouldn't want to be taxed at a higher rate. And, since the American Dream is still alive and well, they firmly believe that one day they, too, will be rich. So, you better not start taxing their peeps now because they'll be joining them shortly!

This is just my theory because I honestly can't figure out the whole "rich people work hard so they deserve those hundreds of millions" thing. I know an incredible number of poor people who work harder than rich people. But, then again, maybe they're defining "hard" differently than I. There's some dissociative behavior going on there. It's the distancing of "us" versus the poor - a bizarre discrimination even though most of the "us" are poor but just classify themselves as middle class.

What do you think? Why is there resistance among many of the middle to lower class against taxing the rich at a "fairer" rate? And, what's with the firm belief that poor people are lazy?

*Poverty level is $22,314 for a family of 4 (or 46.2 million people in the U.S.); Median household income is $49,445.

48 comments:

lisa said...

I think what you think. And I've been trying to make that Exact point, as a matter of fact, to a number of friends of mine. Who, I think, are the people to whom we are referring and are, therefore, unable to see the point.

meg- grow and resist said...

Totally agree with your theory. And all the lines about 'pulling yourself up by your bootstraps' and shame-ridden rhetoric lacing talk about poverty. People both don't want to admit to themselves/others that they are near/in poverty and live in the world where the message is american dream (even as it isn't true, or at least isn't anymore).

Erica said...

“Socialism never took root in America because the poor see themselves not as an exploited proletariat but as temporarily embarrassed millionaires.”
--John Steinbeck

Amy in Tacoma said...

Have you seen the "I am the 53%" signs? Usually they tell stories of some serious hardship, followed by, "But I don't blame Wall St. I am the 53%."

Several people have mocked those signs, pointing out that if the individual's lives and finances are as bad as they say, then chances are they're in the 47% that pays no *federal income taxes.*

Today someone made this observation: maybe these people think they're in the 53% because they know they pay taxes (sales, payroll, gas, etc.), but they think there's some moochers out there that don't pay those things. Maybe they don't realize that that's the very point the 99%ers are making: That everyone pays taxes, even if they don't earn enough to owe federal income tax or they get it all refunded.

Jenni @ RainyDayGardener said...

I've been racking my brain about this very subject for quite some time as well. It is as it stating that you are in favor of a higher taxation rate for the wealthiest 1% is an admission of defeat, that you're afraid you'll never be that millionaire you dreamed of.

Unknown said...

Even worse than not taxing the rich at a higher rate (or at least at a rate slightly more in line with historical values) is the regressive nature of most state taxes. Here's a link to a report that breaks down these regressive rates (i.e. they take a larger share of poor or middle class family income than the rich) for each state:

http://www.itepnet.org/whopays3.pdf

What shocked me was that my own state (Washington) is one of the most regressive.

And, of course, everyone who works pays federal payroll taxes (FICA, Medicare, etc.). Everyone who drives pays federal and state gas taxes, and on an on. Almost everyone is paying some tax. That these taxes are regressive in many cases is just shameful.

Lil said...

I think the Steinbeck quote by Erica sums it quite well. I see this from Europe, where health insurance, school and so much other things are paid through taxes. And we are heavily taxed. And you know what ? Even knowing that too much of this money is wasted by the government, I'm glad to pay. I'm glad to contribute to the general wellness in my country. And I think it is a good thing that rich people pay more taxes. Generally they will do quite well without those extra bucks, I don't worry !
Sorry to see that the american culture shows one of its worst sides here : extreme selfishness. The poor don't want the rich to be taxed in case they become rich one day so they could keep it all for themselves (not wanting a bit to help those who are still poor...)

Heather said...

I agree that people think they will eventually be rich so they don't want the tax rate to go up :-) I also think that the Warren Buffetts of this world, who complain that they aren't being taxed enough, should not hesitate in writing a check to the federal government. I mean, if they think they should be taxed higher, why not just write a check? And I'm also pretty uncomfortable with the fact that republicans and the president are raising so much money for their 2012 campaigns when there are so many people barely hanging on right now. Can't every candidate just send out a pamphlet with all of their views on it to every person in the country and call it good?

Michelle said...

I'm glad that Lil is happy with how her money is confiscated and redistributed. Me, I'm not interested in that. I agree that taxation is regressive, however, my answer to that is that federal government ought not to be in the business of providing health care/education/agricultural subsidies, etc. There are a few things the federal government does best, and is instructed by the Constitution to do. The rest? Let states and local governments deal with those. Now, I realize that this is (presently) a pipe dream - too many entrenched interests would lose too much by scaling back government and letting people get on with their lives. However, this is one probable result of the contracting world we'll see post Peak Oil. Meanwhile, to answer your question - I don't feel entitled to anyone else's money, no matter how much they have of it. Theft and coercion used to be the hallmarks of the Mob - and we deplore the Mob, right? So why are we advocating that the government take on its tactics?

Brad K. said...

Let me make up some gross class labels. Poor class folk work hand to mouth, with little opportunity to save much or accumulate the trappings of leisure and recreation, few savings beyond a couple of weeks or months base survival costs. Middle class has noticeable security, can afford insurance, follow fashion trends, many can afford some savings, some accumulations things beyond survival and base comfort, at least a half-year income's worth of security. Wealthy class people have assets and resources not used on a daily basis, significantly beyond several years' worth of living at their accustomed comfort level.

Taxes should be a mechanism for managing defense of the nation, of regulating interstate commerce. Each citizen should expect the same amount of government protection and oversight; taxes should be seen as a citizenship burden and not a wealth redistribution plan.

Congress sets a tax rate to generate a certain level of revenue. Any deductions leave that tax rate high or cause it to be raised higher. But every dollar affected by that deduction comes out of the national economy, making it unavailable for Americans to invest in products, in companies, or in hiring employees.

Some deductions further business interests; they boost the economy, hopefully more than the initial deduction hurt the economy. Others, like political, charitable, and not-for-profit enterprise donations, take that money that Congress raised by setting the tax rate, and let the average citizen spend it somewhere besides where it would have gone into the American economy.

The middle class have a surplus of income over base survival needs, even if tax demands sometimes eat into choices for luxuries. Taxes here conflict with luxury choices, and to some extent with choices for managing savings and investments.

The wealthy have always been the source for assets used to create and grow businesses and for providing residence opportunities. Mostly they don't think of themselves in that light, and others watching them seen the luxuries and security, and think it unfair.

Taxing the rich destroys their ability to fuel the economy.

So the choice is, to trade the economy, the flow of resources, including energy, food, residences, and incomes, for a better-funded government, or to restore an economy where more people had a chance to climb from the poor class to the middle class than what we have today, where more wealthy are falling to middle class and middle class to poor class than are moving in the other direction.

People are people. What is one person's luxury might well be a tool someone else uses to try something new that might fail and cost them a million bucks or three but might also put thousands of people to work.

If the government can determine what anyone should be able to accumulate or achieve, no one will be exempt from tyranny. You cannot have it both ways. Taxes on capital gains and the rich haven't been solving the problem so far. I grew up with the phrase about "beating a dead horse" and not getting there any faster.

Rachel said...
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Rachel said...
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Danielle said...

Maybe poor people don't want to tax rich people because they (we) just think the government is incredibly inefficient and sucks at handling money. Michelle said it well in a previous comment.

Also, it may be hard to feel resentfully covetous and envious of the upper class when even the poorest among us still generally have a fridge, a TV, and enough food to survive on. We know that even if we don't have it good, we have it better than most of the rest of the world. We are not desperate enough to demand change.

Rachel said...

Many of today's rich didn't earn their money through hard work. They either got it through inheritance (all but eliminating the estate tax helped that along) or in the case of Wall Street, by ripping off the rest of us with toxic asset swaps that destroyed our economy. I recently read somewhere that one of them, hedge fund manager John Paulson, was proud that he hired 100 people, yet, he makes enough money to hire 70,000 at $50K/year. And how does he make enough money to do that? By defrauding the rest of us. No, in my opinion many of the super rich have never worked hard, they just learned how to scam us.

Your Vegan Friend said...

I'm actually a bit embarrassed about how often I think about this topic.... and how upset I get about it. My husband and I are teachers, so we make enough to live comfortably on our little farm and pay all of our bills, but certainly not enough to live "extravagantly." We both work our asses off, so I know for sure that as a "middle class family," we are working just as hard, if not harder, than those much, much wealthier than ourselves.

Don't get me wrong... I'm not clamoring for higher pay or more money or whatever. We're completely content with the life that we have and that includes our bank account. I would even be willing to pay higher taxed myself if I knew that the money would be going to fund things like socialized medicine for EVERYONE and free public education through college for those who've earned it, etc etc. But knowing that I pay a higher percentage of taxes than those who make 5, 10, 20 times what I make really does eat at me constantly.

Steinbeck said it best, I suppose.

Leta said...

I think that part of it is what you said, Crunchy, the "I'm not Tom Joad/Bill Gates so I'm middle class" thing, and part of it is what Danielle said, that, aside from the homeless, most poor people in the U.S. live in houses with fridges and TVs and indoor plumbing, so think that they, too, are also middle class. We don't pay any income tax- well, we pay it throughout the year, but it's all refunded in the spring. It's because we have two children and a modest income. But we pay FICA on every bit on our income, since we make under $110,000 per year. And we pay state, sales, city, gas and a host of other taxes. I'd be happy to pay more in taxes if we could get universal health care, but I'll be damned if I'm going to support tax increases for more pointless, endless wars, and bank bailouts. And, yeah, people over $250,000 per year should pay more, and we should soak the really wealthy, the Oprahs/Buffets/Gates/Kardashians. Because my husband needs new socks more than Kim K needs a new Bentley.

Angela said...

I've heard that, but I think it's more that everyone wants to believe that his own accomplishments are purely the result of his own virtues, rather than having had anything to do with luck or privilege. We're terrified by the idea that we can't control our own destinies, so we just ignore the fact that we can't and keep on insisting that the myth of the self-made man is reality, and dismiss any suggestion to the contrary as "excuses."

The other side of this is if I supposedly control all the factors in my own success, so does everyone else with regards to their own -- therefore, anyone who isn't successful is personally at fault. And since this is "obviously" due to their failing at all the virtues that I as the average American assume that I have (being hardworking, honest, etc.), then it must be true that they are the opposite of this -- lazy, dishonest, and so on.

So I think the average person actually thinks he's doing a good thing when he rips on the poor -- he thinks he's rewarding virtue and punishing the lack of it, and what he hears when someone suggests progressive taxation, public assistance programs, etc. is an attack on his moral system. Americans have problems with ideas of equality not because it requires us to imagine others as being better than we think they are, but because it requires us to imagine ourselves as not being as great as we think we are.

Deanna said...

This whole thing has truly baffled me but I think Angela may have hit the nail on the head. Excellent!

Christina said...

I think a flat tax system has the veneer of "fairness" but it is only skin-deep because of the impact of glaring inequities elsewhere in the economy. The biggest one that comes to mind is the capitalist procedure of "externalization", whereby producers foist off onto the commons every cost they can in order to maximize their profits. One of the reasons Social Security and Medicare are such behemoths nowadays is because businesses won't include reasonable healthcare and retirement benefits as part of their cost of doing business (or a reasonable wage that enables the individual to save on their own). The EPA is a big bugaboo to the right - but the EPA is necessary because businesses don't believe it is their responsibility to have zero impact on the environment. They can pollute the air, water, ground as much as they like in order to maximize profit.

This singular corporate principle rejects all other ethics and has no concern about people or the environment. And it is a principle that is encoded in and protected by state and national law - it is something that can be changed. A business has more obligations than to the bottom line. The flat tax will only be fair if each producer and consumer is required to pay for all the real and true costs of their choices.

Christina said...

I think those who have highlighted that we really have a REGRESSIVE tax system in this country have hit the nail on the head. People who claim the wealthy are taxed unfairly look only at the progressive income tax system (higher taxes on higher levels of income). But the whole definition of "income" has been written to benefit ONLY the wealthy, because it excludes inherited wealth and more importantly, capital gains. What we call "income" tax is really a LABOR tax and nothing more.

Does anyone really believe that the value of investment to the economy is MORE than the value of labor to the economy? Our tax system clearly favors investment and penalizes labor.

simply living said...

I have never denied being at poverty level! The rich should be TAXED on a fair scale. I worked very hard what minimum wage because I took pride in my part in a business to my detriment because half of the store where I worked have been fired, driven out or left because of the unfair practices being used. We made too much money and they wanted to cut costs. It's been a year and I can't find a job! Physically I am paying for working so hard. Retail is perceived as a lazy person's job (I heard people talking - right in front of you most times). I have pain in my shoulder that even after a year of not doing that job anymore still gives me sharp pain and no it;s not an injury.

When my kids were little, we had state healt. As adults we were not eligible because of being over the limit by $100. We didn't always qualify for enery assistance for the same reason. So what, you tighten your belt, literary. One year I lost over 30 pounds and no not from dieting. I fed my children and husband first. My husband did not work, had diabetes and chronic back pain. Still does! Everyone thought "how good you look" . I did not advertise to anyone outside the home, our situation was too constant and not real fixable. Why not drug test anybody on state aid, I wuld have been first in line!

I learned to not have leftovers in cooking, recycle, re use, and freeze in winter (I keep my furnace at 55 - 60 degrees), go to dump and not have garbage pick up all on my own. Friends have donated jeans for my sewing room because I could not buy fabric. Denim is still my favorite fabric.

Quite frankly, if you are using the word communism I feel like we are already there. It's not just money, I think of communism as a state of mind also, We are being overly controlled by state and government, I have been reading the book 'surviving off off grid - decolonizing the industrial mind". A real eye opener, he says a lot of what I already think only with eloquence, Mr. Bunker explains why the some rich became richer early in our country, Real estate taxes incorporated the buildings so that the rich who owned land with no buildings were taxed LESS than the farmer who had a house and a barn. I learn something new everyday.

My American Dream has been shot down many times. The poor don't get loans! Right now I am struggling with the mentality of our state and government denying how bad off we are. Unemployment is not the 9 % claimed, they are only counting those on assistance. In our house we are 3 adults with no jobs, we are NOT in that count. And yes we apply for jobs, no one calls us back!

I don't want to be wealthy, just happy! Unfortunately
wanting land is what would make us happy. To get away from the 'herd' mentality, the waste of city life,
to do for myself. I generally don's go around feeling sory for myself but picking myself up continuously is wearing me down.

Sorry for rambling on but I don't hide from th truths, they stare me in the face whenever I watch the news, read the newspaper or hear people talk about how good life is (in our family)! I want off the merry-go-round!

Robj98168 said...

I really think people are the ditto heads that Rush Limbaugh says they are. Whatever Rush or the right wing pundit of choice says must be gospel.

They really don't like Herman Cain's 9-9-9 plan. Which sounds a lot like what Obama wants to do by raising the upper incomes taxes.

I figured out a long time ago when loopholes are made, for the rich, for families, a marriage tax credit blah blah blah... Since I don't fall into any of those categories, I am probably one of the sorry bastards paying for it!

Anonymous said...

Erica, just another reason to love Steinbeck. Never read or heard this quote before - so, thanks.

Laura said...

"Taxing the rich destroys their ability to fuel the economy."

I think our current recession disproves this. On the one hand, the poor and middle class are not spending and on the other, the rich are not investing. Corporate profits are at a all time high, and yet they are not hiring or moving to improve matters in anyway. Banks are also making more profits than ever, and yet are not loaning money out, even after 'the people' paid to bail them out. How much money does one need? The rich are happy to sit on what they have while the rest of the country struggles.

Bethany said...

We're lower middle class - not in poverty, but below median income and after expenses have little to set aside.

Having said that, I don't feel like I have any right to anyone else's money, regardless of whether they worked hard for it or fell into it like Paris Hilton.

The real problem with taxing the rich is that it gives a third power (the government) the ability to make things arbitrary. You make more money? Great, we'll take more of it - that's only fair, right? It's a slippery slope. What about this - You have too much land and we need some, so we're taking some of your land.

The government is a bloated, inefficient mess of unconstitutionality. That's the real problem. If we taxed the rich people at 100% of their income, it still wouldn't solve the problem. The problem is that our government has it's nose in too many things it doesn't need to be and for many years now has been working busily to make itself and its programs "indispensable" so that we won't consider reducing it. How often are we so upset about things, like how MILLIONS of dollars were spent on the Rawesome raid and investigation because they sold raw milk. Raw milk? Seriously? This is the government trying to control everything so we will not realize we CAN live without them and their regulations. We need to pare down the government to what it is REALLY supposed to do as per the Founding Fathers of this country, and let the states handle the rest.

Want to see some real change? Let's get rid of each and every lobbyist in DC. I firmly believe that they are one of the most underratedly significant problems today. They facilitate so much political corruption which results in laws, subsidies and regulations that benefit big industry and shut out the little guy. This is why small raw dairies can have their livelihoods destroyed by FDA raids and conifiscated inventory on a mere suspicion of contamination, but there are huge corporations that get away with a slap on the wrist for allowing millions of tons of salmonella or otherwise contaminated food onto the market, even if it sickens or even kills people.

Yes, I am a staunch capitalist. I mean REAL capitalism - No government subsidies, no special privileges, and certainly no such thing as "too big to fail." Every.single.company.treated.the.same.

That's why I've been asking - all these people occupying Wall street, have they been worrying about occupying the White House? Congress? Because IMO, our lawmakers are the ones who have enabled these bankers to take over and systematically destroy the country.

lisa said...

Michelle,

Cream and sugar?

Dana Seilhan said...

I don't know about anybody else here, but I am not low-income because the government is unconstitutional, bloated, or inefficient. I'm low-income because I don't make a lot of money. Obviously the government being unconstitutional, bloated, and inefficient hasn't gotten in the way of the Bill Gateses, Warren Buffetts, and Kardashians of the nation being able to "earn" their billions.

And before we get into why I am low-income, which actually I am not going to do here, I would just like to point out that "hard work" is a subjective definition, one largely formulated by the people responsible for hiring and paying us. As long as civil rights laws are not violated, and especially in employment-at-will states, employers make the rules and employers set the pay rate. All employees can do is go along with that, if they want to be able to eat and have a roof over their heads.

The Bill Gateses and Warren Buffets and Kardashians of the country are not employees. They are business owners. Show me a billionaire who is a wage employee and earned ALL THOSE BILLIONS from their wages and I'll believe all those billions are "earned". Otherwise, all they did was park that money in some kind of account and let it collect interest; last I checked, that is neither working nor earning.

Meanwhile, if you feel taxation is theft, feel free to move to an area of the world where there is no nation-state present, because every single nation-state I know of levies taxes of some kind. I hear Somalia is lovely this time of year.

Greenpa said...

I have a different theory. Imagine that!

I've been observing our behavior closely for a long time, and I think there's an aspect to both "human" and "USA" behavior that we haven't really noticed, recognized, or studied.

It's the remnants of the "tribal" level of organization. For most of our evolutionary past, we have been tribal. One of the aspects to that is the unquestioning willingness to follow leaders; and most particularly in times of crisis. In a crisis- you'd better do what the chief says- or you could all wind up chaotic, and dead. Wanna see an example of our modern tribal behavior? Go to any major league football/baseball/etcball game. We love being tribal- belonging.

Right now we have tribal chiefs - like my buddy Lush Rimjob - who not only chant but scream - that taxing the rich is evil and unAmerican, and directly from Satan.

And the tribe- no other leaders in sight - all follow, in desperate hope that this will save them. Logic and thinking has nothing whatever to do with it.

And sure; way down, there's the "American Dream" - that someday your prints will come, and you'll be recognized by fate as one of the elite, and hell no, I don't want to be taxed.

Greenpa said...

I do also like Angela's insights into human behavior. Good stuff. Another level of integration. :-)

Kim said...

That's always been my theory too. It's the only thing I can thin of to explain it.

Anonymous said...

Lately, I have come to the conclusion that POS tax (as explained to me, I don't have personal information, sorry) should be the ONLY tax ... everyone pays the same tax on any/everything they buy ... lots of money? Lots of purchase ... lots of tax. Buy oatmeal, baby's car seat, and Daddy's shoes? Pay the tax on all of them ... buy a big boat, fancy camper, dinner in a 5 star restaurant? Pay a LOT of taxes ... but the best part that the "purchaser" (you and me) never have to think about it, cuz it is in the purchase price ... and the RETAILER pays it as a percentage to the powers that be. No one is exempt ... no loopholes ... everyone treated alike ...

Anonymous said...

I am still surprised by the number of people who rationalize their place in this system by saying they "don't want a dime of anyone else's money".

When you get in your car (or ride the bus or take your bike), you expect that there will be roads, and they will be paved, and that there will be traffic lights and traffic control. That's from taxes. (Taxes = Other People's Money.)

When you hire an employee, you (typically) expect him or her to have a basic education. Taxes.

Even if you send your kids to private school, you expect that, if you lose everything, you could still send them to public school. Taxes.

You home school your children, but they participate in extracurricular activities at the local school district. Or they partake in a curriculum or national exam to prove their competency at various grade levels. Taxes.

You use the public library. Taxes.

If your house is on fire, you expect the fire department to help. Taxes.

You call an ambulance and it shows up. You might get a bill eventually, but in the meantime, you received medical care from EMTs. Taxes.

While their are many volunteer fire and ambulance departments, much of their equipment and training is paid for through taxes, even if the volunteers themselves are unpaid. Taxes.

If you are in a terrible accident and can't provide insurance - not because you don't have it, but let's say it's because you suffer a traumatic brain injury and you are on your own and no one else can hand over your insurance card, you expect health care to be provided. While you may pay for it in the end, the hospital will 'front' the money for your care. They are basically giving you a loan. Taxes.

There is some semblance of law and order in your town, because of the police force. Taxes.

Someone does something wrong to you, and you end up in court. While we all know about lawyer's fees, that doesn't cover the costs of running the judiciary. Taxes.

There is enforcement of laws that aim to protect your water and food, such as agricultural and meat inspection. Taxes. (Even though I admit they are flawed, their existence requires taxes.)

National parks? Protected wildlife lands? Yellowstone? Taxes.

Your bank goes under, but you don't lost everything. That's because of the FDIC. Taxes.

A flood is predicted and the National Guard shows up to help protect your area. Taxes.

A hurricane hits and FEMA sets up recovery loan programs. Taxes.

So, no, you "don't want a dime of other people's money", but you expect that your rights, to life, liberty, and the pursuit of happiness, will be honored. That requires taxes. That's other people's money.

Yes, the system needs and overhaul. Yes, it is really, really messed up. But before you rationalize that you are 'not a burden on the system', think about the bigger picture. Just because you aren't personally using food stamps or state-supported healthcare or social security benefits does not mean you are not receiving government assistance funded through taxes. You do receive assistance from the government, every day of your life.

I think part of the problem is related to the morality issue several posters have raised, but also to a certain mentality in the American consciousness: We want to say, "I did it MYSELF". no, you didn't. I helped. Everyone who paid taxes helped. Everyone who ever bought anything that was taxed helped. You're not so special. You're not so spectacular. You're lucky. Good for you. Now play nice in the social contract and keep the ball rolling for others.

Anonymous said...

Interesting opinion piece by Michael Petit, president of Every Child Matters, on child abuse in the US: http://www.bbc.co.uk/news/magazine-15193530. (Petit is an American, even though this piece is published in the BBC.)

Interesting points here about taxes, when we compare child abuse in Texas and Vermont. We should be outraged over the statistics in this article.

Whenever people shout that we need 'less government', our response should be, "What about the children?"

Humble wife said...

I am going to comment without reading the other comments so I am not sure I will be repetitive or not.

I find the whole discussion vague. Each of us does in fact define our status by personal measures. We cannot relate to the super rich which after certain perks seems to be nearly all of our federal elected officials, much of the actors/actresses in Hollywood and others, of course.

For me the question is not about why poor don't want to tax anyone. For me it is all about a slope that one will get on and never be able to come off of.

I find my travels and even when we lived overseas an eyeopening event as ALL of us are rich when we compare ourselves to the world and real poverty rates. I find that this slope of taxing the rich something that means EVERY American in the global economy.

I am defined as poor by American standards as our actual income is not high-although several years ago it was considered middle class. But the defining tools for poverty or wealth are skewed as I live on my own property, raise all of the meat we eat (beef, lamb, veal, pork, chicken, turkey, duck and goat), raise nearly 50% of the food we eat and eat year that number increases along with the orchard that is a year or so away from producing for us.

Poverty and wealth are and can be defined but they are irrelevant if those with the income are unable to manage their finances and or their wealth...such as it has been for our government for many many years.

I find the occupation of areas in our nation pathetic. I find that our political class has effectively immersed the masses in sheer ignorance of reality and has broken our common sense.

For the record any money or foods I grow are mine alone to use or not. I do not owe anyone anything, nor does another. Please appreciate that the system we have may not be perfect but it is far better than many places world wide. Taking from one to help another creates a tiered system that ends up in hiding wealth, reducing how much one will make or a breakdown such as we are seeing, where folks think they deserve something because another is super wealthy.

We deserve not to tax the rich but to manage our leaders.

Only in a nation so wealthy can a debate such as this take place.

by the way...any and all of us can give more money to the government to help out the poor. It is not a government holding us back from our action but seemingly self righteous people who wont and dont give unless someone more wealthy than they, give more.

Brad K. said...

Laura,

This recession is primarily political, not economic in it's origin or reason for stagflation.

This recession is the direct result of actions by the US government; no private citizen or organization could have caused the recession to not happen.

Abusive taxes on businesses, on individuals, and on investments have stopped businesses from operating or expanding in the US, or at least slowed them dramatically.

Extended unemployment benefits have kept people from getting back to work before their benefits run out. Some resist changing fields until they have to, others are just more comfortable waiting out the clock before going to work. Many are making do on unemployment rather than taking a lower-paying job than their previous employment. The overhead of government means that unemployment benefits will never be as "efficient" at keeping people shopping and consuming, as if they were privately employed.

The answer to this recession is not economic, and not who to tax. The answer is political, and tied to the number of regulations, and the amount of spending and intrusion into the daily lives of Americans that our government indulges itself.

Peak Oil Hausfrau said...

Studies show that most Americans don't realize just how concentrated wealth is - with 1% of the people owning about 34.5% of all wealth in the country. The bottom 80% of people own only about 15% of all wealth.

I think most people also believe - and want to believe - that our economic/financial/legal system is fair, with everyone given equal opportunity to succeed, instead of the reality, which is that a complex legal and regulatory system is in place to protect the wealth of the top 1%, and continue concentrating wealth to the top. The bailouts are just one example of that system.

Christina said...

Brad K, where is your evidence for the statements you make about people staying on unemployment rather than getting jobs? Marketplace on NPR had a piece yesterday on the booming N Dakota economy (3% unemployment and budget surplus, driven by hydraulic fracturing for oil and gas), which is desperately looking for 15,000 new hires and willing to train them. 15,000 jobs in the healthiest state economy, with millions unemployed nationally. Long-haul trucking was covered in a recent piece as well as an example of an industry needing workers. Nurses too - except who pays for the three years of education and training?

Now, if you websearch "businesses sitting on cash" you'll turn up dozens of reports that S&P companies have increased their cash holdings by more than half a trillion dollars since the recession began, and have eliminated more than eight million jobs, while the labor population has of coursed increased in the last four years. But of course, the fault is lazy workers and consumers who have turned into savers instead of spenders...

I dispute your claim that abusive tax rates have driven companies overseas. Reports have been solid that our statutory corporate tax rate (39%) is a fantasy, with the effective tax rate being less than 20%. (And as with personal income tax rates, the wealthiest and most profitable companies pay the lowest effective rates including negative rates.) I would also argue that multinational operations in every industry (manufacturing, livestock, services, etc.) have been relocated overseas not because of tax rates, but because of minimum wage laws and environmental regulations. Both of which I would argue protect fundamental human rights.

You are right that government will never be the most effective route to keeping people "shopping and consuming" (as if that's what the readers of Crunchy Chicken advocate??). But the most effective legislative change to be made is not a reduction in the corporate tax rate: it's a rewriting of the fundamental corporate charter laws. Until corporations are held accountable to principles beyond "maximize profit to the shareholders" there will be no saving this economy.

lisa said...

I also think, though, that more people would rather not Think than would rather not tax the rich.

Brad K. said...

Christina,

North Dakota has some severe handicaps when it comes to hiring people. Winters are harsh in North Dakota. The population is widely scattered, with few cities, and fewer night spots, etc. This can seem a hardship to newcomers.

There have been some follow-on reports on that NPR summary that fraccing is a great economic opportunity. Notice that Pennsylvania, another fraccing center, isn't reporting the same full employment and robust economy. Most other states would have a hard time instituting the kind of fiscal and political discipline behind the stability and resilience of North Dakota. Fraccing might be helping; North Dakota's current well-being started long before the current fraccing fad.

As for the unemployed milking the system, some the people I have become acquainted with make a living doing pipeline and refinery construction here in Ponca City, OK, home to one of the Conoco refineries. They tend to work a few months and build up some cash, trade trucks or cars or pick up a new travel trailer -- then either finish the task or get themselves fired, file for unemployment, and muddle along until unemployment runs out. Then they call a buddy that is working, and head to a work site here in town or California -- or Jamestown, ND (I can give you this guy's name if you want to call him and check the ND trip part out; he reports that when he first got to the work site there was ice covering the floor in the building they were putting up, and the materials they needed were in a yard under four feet of snow. That is ND; he was surprised how many days they went below -20F, and how many 20 foot high snow banks there were around town.)

The reports I have been reading pretty much confirm that extending unemployment benefits means that some people will put off taking a job because available jobs have less benefits, lower pay, and often less advancement opportunity. I would like to see the number of people that take the full period of unemployment payments, vs. those that spend less than two months on unemployment. Remember that unemployment often accompanies food stamps and other social services that total more than a part time minimum wage job; many families want to put off taking in less income as long as possible.

I don't know what to say to you about requiring other guidelines -- higher goals -- for corporations. This gets into civil rights, Barry Goldwater's observation that "You cannot legislate morality", and Ben Franklin's "Those that would sacrifice freedom for security deserve neither." That is, we differ, apparently by a big bunch, in what the role of the citizen is in restraining a corrupt and tyrannical government. Forcing corporations to do what you want steps on the freedoms of a lot of people to take care of their own needs.

Let me put it this way. If what you feel is shared by the overwhelming majority of Americans, and they buy and vote in accord with those values, then there is no need for morality rules and regulations. Businesses that step on customer toes tend to go broke or change, or face criminal charges.

The Constitution appears to limit taxes on people to a "head" tax, proportionate to the number of people, without regard to race, or income, or occupation; this also seems to be a tax levied on the states, and not individuals at all. This so-called Fair Tax appalls me. If there must be an income tax (there states, like Texas, for instance, that manage to do quite well without an income tax at all.) then it should be a flat tax. Then we could all complain as if we were already millionaires.

Micah said...

I've been thinking about this for a few days. I've been trying to nail down exactly why overtaxing the rich bothered me as a poor person. I figured it out. It's not because I think ill be rich some day. It's because I don't like the idea of anyone, especially the government, deciding that I have enough of anything so they have the right to take it from me.
Nobody owes me anything. Not the government and not rich people.

Christina said...

Brad K - I don't think more requirements in the basic corporate charter would require legislating morality. For example, imagine the impact if the charter included language mandating that the corporation have zero impact on the common environment. Does that have a questionable moral basis? No, it simply requires that corporations pay true costs for their operations, rather than stealing resources that do not belong to them (using the environment as the dumping ground for their waste, destroying roads with long-haul shipping practices, etc.). Will the corporation try to pass all those costs onto their customers? Of course they will - but the cost of a product will reflect real inputs rather than the customer believing a product is nice and cheap and worth the price, and not realizing that things like high healthcare and tax rates are artificially absorbing a portion of that cost. Would so many buy an iPhone if it cost $1000?

It's time we stopped complaining about high taxes and started realizing that there is a reason taxes are so high. Those costs exist in the marketplace regardless of whether government pays for them via taxes, or if we pay for them via prices. The costs of retirement (Social Security tax), the costs of healthcare (Medicare tax) - we'll pay for them publicly or privately, we've just opted to pay for the publicly at this time.

There are all sorts of interesting movements afoot to get normal capitalist restraint back into the marketplace, which has been so eroded by the modern system that Adam Smith wouldn't recognize things. (And any free-market capitalist who idolizes Smith and his "invisible hand" should actually READ Smith - the whole five-volume Wealth of Nations and not just the pro-unbridled-capitalism excerpts that are pushed on us.)

On our particular topic, I recommend you check out www.bcorporation.net for work on improving the corporate charter.

The corporation is an artificial entity that cannot be born without state approval, and cannot die, either - it must be killed, again by the state. It has always been regulated by the state from its earliest incarnations (the East Indies trade compacts). The question is, shouldn't the state regulate corporations for the benefit of the entire society, and not simply for the benefit of the few who hold the corporate charter?

karen said...

*scratches head*

Why "I" (living a very comfortable "poor" life, thank you) don't want to overtax rich people? Um, simply because this is America, plain and simple. Like Micah, I don't believe anyone has the right to determine who has "too much" and then take it from them.

*scratches head again*

Hmmm, I think I'm going to be rich one day? Well, thanks for the heads up. Golly, I must be getting senile, because I don't recall ever thinking that.

Brad K. said...

@ Christina,

Climate change isn't necessarily accepted science. There are contradictory indicators, things that weren't paid for by anthropogenic global warming advocates.

Reports from NASA and US Army scientists that all the planets in the solar system are warming have been dismissed. Early reports that gamma radiation -- levels are affected by the earth's magnetic field, which is affected by the sun, can influence cloud formation, challenge the supposition that only man-produced CO2 and methane could be causing climate change.

40 years ago the reporting was that the 1950s was the mildest decade on record, implying that "less mild" will be the trend for the next several millenia. Another, perhaps apocryphal or urban legend style proposal, is that the next ice age actually started in the 1200 AD time frame, and it has only been the burning of the continental forests of that time and the aggressive burning of fossil fuels that have staved it off. Other, perhaps more credible reports claim disturbance of the upper atmosphere by planes including commercial airliners and military aircraft have destabilize the environment more than has been realized. And, there is Rush Limbaugh's observation that each and every volcanic eruption puts out dust, acids, and CO2 amounts that dwarf what the industrial world produces.

We know that 97% of the methane released into the world comes from swamps, wetlands, and other natural sources, yet activists protest cows grazing on leased Federal lands as being major sources of environment destroying methane -- without asserting that an acre of grassland over the course of a year produces any less methane than if a cows also occupied that space. And doesn't take into account wildlife and other variables.

Myself, I think Peak Oil is a better reason to reduce reliance on fossil fuels. Economically the fact that cheap energy is no longer as cheap or accessible, for a number of reasons, is a very pointed motivation to change.

But I very much dispute that requiring corporations to be carbon neutral is supportable. If the majority of Americans were now living carbon neutral there would be no market, and thus no corporations, operating any other way.

And I wouldn't rely on the government to get any kind of real regulation to work. It has been since the 1970s that Detroit had mandated mileage improvement regulations; the Japanese and Germans managed to meet those goals, for the most part. The US manufactures, with the government's blessing, sent problematic work to Canada and Mexico.

The government mandated the bad loans that were the heart of the housing crisis, and allowed the shady accounting that produced the mortgage derivatives, then the government guaranteed those loans.

No, any improvement in corporate ethics has to start with government living by the rule of law for a change, and within their income as well. And if Americans did the same, you wouldn't have to worry about the corporations. They are, after all, merely groups of citizens working together.

Deanna said...

So Rush Limbaugh is a climate scientist now? Thanks, I needed a good laugh. :)

Brad K. said...

Deanna,

No, Rush is not a reference -- but that doesn't mean he is wrong all the time. That just happened to be where I heard something that reminded me of other reports from the past, that seemed to agree with what he is saying.

I don't claim that things humans have done haven't affected global warming. Destroying the Amazon rain forest in recent years? Yep. I think that is a significant driver. The current clearing of the Asian continental forest? Yep. The clearing of the old growth forest that used to cover the US from the Mississippi to the Eastern seaboard? Yep. The heat and albedo effects of replacing forests with fields, then with cities and city streets and houses and commercial buildings and parking lots? Most assuredly.

I think the answer is still out, though, on CO2 and methane, at least on whether what mankind is doing is significant with relation to natural sources and ongoing natural cycles. And because we have to deal with Peak Oil anyway, I am not sure I care about carbon footprints as they relate to generation of greenhouse gases. If we don't use, or have available, the fossil fuels, then we will have a much smaller carbon footprint.

What I have seen is painful symbolic gestures that create an impression that we are "doing" something. That gets not into environmental conservation, but to marketing and fundraising (which I do object to). I don't consider collecting donations to be anything like marketed fundraising; they are different in intent, and in scope they create for abuse and corruption. But that, again, is just my own view.

And Rush can be fun to listen to, sometimes. One thing he excels at is something we need to concentrate on bringing back, though, and that is the well-told story. Not the kind that comes from journalism, nor from novels. Some of the "Old West" themed events still have storyteller exhibits and competitions. But if we want to reduce our carbon footprint, learning to sit and listen to a story that takes longer than twenty minutes to tell will increase attention span of teller and of audience, provide entertainment devoid of artificial diversions (ads), and provide a venue for restoring oral history and relating to other's lives that weren't written in Hollywood.

Blessed be!

Christina said...

@Brad K - It's interesting that you got on your climate change hobby horse (I see you post comments at various blogs so know your commentary habits and proclivities), considering that I did not mention climate change at all. I said "zero impact on the environment". Greenhouse gas release is only one piece of that puzzle. It's one I'm concerned about, along with peak resources; but when I think about corporations impacting the environment, I think far more about direct and immediate rape and pillage of the environment in order keep production costs as low as possible. CAFOs whose only solution to fecal waste is to store it in open cesspools, contaminating the air constantly as well as risking (and regularly achieving) groundwater pollution. Industrial producers who offload hundreds of thousands of chemical disasters into the air and water at no cost to themselves, but significant health and welfare costs to the commons. Massive deforestation for corporate production, strip mining, etc. All these things produce economic costs which the producers (and and therefore consumers) are not paying for directly.

I note you do not have response to my assertion of one of the fundamentals of economics, that all costs exist somewhere. Right now, we are simply paying for a huge chunk of economic costs via personal taxes, rather than properly integrated into the actual cost of products. That corporate diversion of costs cleverly masks the true cost of an item and misdirects consumer animosity to the government, which is forced by the marketplace to pick up the hidden costs through tax dollars. And yes, the government is forced to do it by the citizenry, who want clean air and water and Medicare and Social Security etc. in huge percentages. The fundamental paradox of our political system is that we want all of those things but don't want to have to pay for them.

Cold House Journal said...

What Erica said Steinbeck said. Right on the money, so to speak.

But, how is it that what seems "fair" to so many today is grossly out of balance from what we considered fair in the recent past? Look at the history of the highest marginal tax bracket: during the Eisenhower administration, 90+%. During the Nixon/Ford administration, 70%. Under Reagan, 50%. Now? 35%. Where is the outrage?

You'll notice that all the historical examples above were under Republican administrations. Republican! The rates went up even more, or held steady, under Democratic administrations. But in the past, even the Republicans couldn't push them down so far as Bush I and Bush II managed to (and the current Republican legislature continues to).

How did this happen? By cleverly making the party of not-taxing-the-rich also the party of "faith", "God", "patriotism", "family values", and "anti-gay-marriage". So many people want to vote for these "values" that they are willing to overlook, or even avoid knowing about, the other motivations of their chosen party. It's been a clever ploy.

Brad K. said...

@ Christina,

Sorry I misunderstood the gist of your concern.

I doubt that any solution crafted by lawyers and politicians will do more than create service industries and taxes. Few problems really get solved that way.

If your concern is the monopolistic power of corporations, the answer is going to be competition; you will *have* to make it cheaper to operate a small company than a big one. Or make products and services more effective to serve or put together as an individual than as a company. Regulations, liability concerns (those dratted lawyers again), put too much cost on the little guy; the big fish are pretty "resilient" with their foundations of lawyers and inertia.

For even the worst abuses, I want to avoid building an ogre that cannot be controlled, like big government, lest the ogre become a bigger obstacle, another in a history of unintended consequences. I would rather starve the beast that is a problem; stop using the products the abusing company produces, stop using the services they provide.

If we as a nation cannot agree that we won't use a particular company, then we don't agree solidly enough for a minority to tyrannize the rest of us. If we aren't careful, we risk trading long term disasters for near term catastrophes like food riots and other disorders that shadow the future.

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