Re:Our Broken Economy, in One Simple Chart
by savanaly on Tuesday August 08, 2017 @02:15PM
(#14960793)
Who cares about wealth? If I want to save my income more than my neighbor and build up a relatively large amount of wealth, that's my business. If I go out and earn a very large income compared to my neighbor, I can at least see how that's the government's business and agree that the higher income earner should pay more. But I strongly disagree with the notion that wealth accumulation should be penalized.
Re:Our Broken Economy, in One Simple Chart
by ekimekim on Tuesday August 08, 2017 @02:27PM
(#14960944)
I wasn't meaning to imply that wealth should be taxed, however it's a fair point that I'm rather badly conflating income and wealth in the OP - I'm basically using wealth as a proxy for income. I suspect that they are very strongly correlated though (a quick google shows [1]). Unfortunately I can't seem to track down a hard figure on the 20th percentile of income in the US.
[1] http://www.visualcapitalist.com/relationship-income-and-weal...
Re:Our Broken Economy, in One Simple Chart
by TheAdamAndChe on Tuesday August 08, 2017 @02:32PM
(#14960998)
The issue is scale. It's one thing to have a few million dollars and give an inheritance to your family. It's another thing to make hundreds of millions if not billions of dollars a year at a time when the quality of life for most people in the country is declining. It probably wouldn't be as much of an issue if everyone was experiencing the growth that the top 0.1% is.
Re:Our Broken Economy, in One Simple Chart
by ddxxdd on Tuesday August 08, 2017 @07:45PM
(#14964134)
Even if we assume that your premise is correct that the rich deserve to pay more, there are 2nd order effects to consider. The rich may respond to tax hikes by raising the price of their goods and services, by moving their taxable income/wealth offshore, or by producing less/retiring.
Here's an interesting thought experiment: Temporarily imagine our economy as a barter exchange between the rich and the poor. If the exchange rate between goods and services provided by the rich and goods and services provided by the poor remains constant, then no tax policy could ever possibly change the income distribution.
Secondly, the entire point of a progressive tax system is that the utility of wealth is not proportional to the amount of wealth. Doubling the wealth of someone below the poverty line can completely change their life, whereas someone with $10 million net worth lives much the same as someone with $20 million.
Progressive tax rates allow us to extract more wealth from the rich (who don't "need it" as badly) for the benefit of society as a whole. You can call that socialist if you like.
[1] http://www2.ucsc.edu/whorulesamerica/power/wealth.html