Comments on: Middle-class servants to the wealthy

By: Dave M

Dave M — Tue, 19 Aug 2008 03:10:28 +0000

Well, within that time period of the survey I took a 28% pay cut because my job was outsourced in a merger deal that made the CEO of my company 150million. How is that fair to the working class? That CEO is certainly not investing his gains back in the community. In fact he held a press conference with the mayor where they donated 50K to a local charity and then restated the manufacturing center’s regular proposed operating budget for the next 2 years as a re-investment in local jobs. Most of us are not entrepeneurs and the education and training I invested in my career have been negated by the shift in my industry to outsource and redefine layoffs as cost savings. Most people I know live check to check and do not have the resources or savvy to start a business. The lesson is that the worker is no longer a valued asset of productivity… they are a cost to be minimized. Why hire fulltime and provide benefits and if that parttime worker is sick and cant afford a doctor… oh well. So where should the burden to help our citizens fall? Business has shed that responsibility in the name of profit and charity only goes so far. Besides 96,000 returns over 9 years of data does not sound like a huge sample. I think this might be skewed to prove somebody’s point.

By: chrisgraham

chrisgraham — Fri, 22 Feb 2008 23:21:12 +0000

And I think your points about upward mobility are strong, Steve. I think the picture that Sam was offering us here needs to be a little bit more complete.

By: Steve Kijak

Steve Kijak — Fri, 22 Feb 2008 22:40:46 +0000

Chris,

Good point and it would be interesting to see who now makes up the top 1% and at what dollar value.

“the top 1 percent of Americans, those earning in excess of $348,000,”

It is obvious that more then the top 1% of the population now makes more than $348,000 from the result of a strong economy and free market that presents opportunities that were not available in the past…

By: chrisgraham

chrisgraham — Fri, 22 Feb 2008 05:14:58 +0000

Math question – how can there be that many more people in the top 1 percent? That’s what Sam was writing about, from what I can tell. The population has grown some since 1996, sure, but 1 percent is 1 percent.

By: Steve Kijak

Steve Kijak — Fri, 22 Feb 2008 02:54:50 +0000

Mr. Rasoul,

You state: “In that year, the top 1 percent of Americans, those earning in excess of $348,000, pulled in a larger proportion of the national income than at any time since 1928“.

But data from a Wall Street Journal article shows that many have moved up into that top tier: “The Treasury study examined a huge sample of 96,700 income tax returns from 1996 and 2005 for Americans over the age of 25. The study tracks what happened to these tax filers over this 10-year period. One of the notable, and reassuring, findings is that nearly 58% of filers who were in the poorest income group in 1996 had moved into a higher income category by 2005. Nearly 25% jumped into the middle or upper-middle income groups, and 5.3% made it all the way to the highest quintile“.

And then there is data showing those who moved up into the middle class: “Of those in the second lowest income quintile, nearly 50% moved into the middle quintile or higher, and only 17% moved down. This is a stunning show of upward mobility, meaning that more than half of all lower-income Americans in 1996 had moved up the income scale in only 10 years“.

http://online.wsj.com/article/SB119492157951090886.html?mod=opinion_main_review_and_outlooks

You also stated: ”I don’t suggest trying to abolish inequality of income, but only returning to moderate inequality, such as the 1970s when executives made 30 times more than the average worker“.

So what is your solution?
Is it tax the rich even more?
Is it another form of wealth redistribution you favor?
What program would you establish to keep the executives from making so much money?

Taxing the “Rich” or making them pay their fair share is always a good line to get some people’s attention, but what do you consider a “fair share” for the rich to pay?

“Last week the Congressional Budget Office joined the IRS in releasing tax numbers for 2005, and part of the news is that the richest 1% paid about 39% of all income taxes that year. The richest 5% paid a tad less than 60%, and the richest 10% paid 70%. These tax shares are all up substantially since 1990, and even somewhat since 2000. Meanwhile, Americans with an income below the median — half of all households — paid a mere 3% of all income taxes in 2005. The richest 1.3 million tax-filers — those Americans with adjusted gross incomes of more than $365,000 in 2005 — paid more income tax than all of the 66 million American tax filers below the median in income. Ten times more”.

http://online.wsj.com/article/SB119786208643933077.html

I am by no means in that “evil top-tier” but I am working hard, improving my skills, seeking out and taking advantage of opportunities, and sacrificing now to improve my lot in life. Opportunities that come from a system that rewards risks in investments and hard work. If your plan is to make the “Rich pay their fair share” in the form of increased taxes and they then take their investment money elsewhere where does that leave me? And by the way a growing amount of that “Investment” money is coming from mutual funds and 401k’s that the majority of Americans are now in…