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Rich get richer / poor get poorer
Old 09-03-2006, 12:17 PM   #1
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Rich get richer / poor get poorer

The disparity between the rich and poor is growing - at least that's what I read.
What's the solution ?
Do we tax the rich more - those who are entrepreneurs who utimately create jobs?
Do we raise the minimum wage - and perhaps ultimately lose jobs because companies can't pay the higher wages ?
Do we raise taxes on everyone, or mostly everyone and risk recession ?
Do we lower taxes (or keep them low) because people will have more money to
spend and boost the economy ?
Who do we believe - the tax and spend liberals or the conservatives ?
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 12:31 PM   #2
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Re: Rich get richer / poor get poorer

Quote:
Originally Posted by bennevis
The disparity between the rich and poor is growing - at least that's what I read.
What's the solution ?
Although it makes for great sound-bite journalism, I'm not sure there's a problem.

Some people have learned to make money and they keep on making more of it. It's almost as if they're being rewarded for practicing their capitalistic skills.

Other people have learned to not earn money, or at least to spend it faster than they make it, and they don't seem to be able to change their habits. Perhaps they're getting everything they deserve.

Society appears to provide some methods of supporting behavior changes for those who are ready to change. The support could probably be better, but a more cost-effective method would probably be implemented as soon as it's determined. I'd rather have a government providing tax incentives to industry & non-profits (to hire/train motivated employees) than to have to pay more taxes to government programs.

As for the rich, why remove their incentive to keep getting richer? For every money-grubbing SOB like Larry Ellison or Donald Trump there's a Bill Gates, a Warren Buffett, and a Ted Turner. It's hard to believe that those three are turning so philanthropical in their later lives, but the same happened with Carnegie, Morgan, & Rockefeller.

The ends don't justify the means but that's no reason to squash incentive & motivation with socialism... or even communism.
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 12:40 PM   #3
 
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Re: Rich get richer / poor get poorer

Quote:
Originally Posted by bennevis
Who do we believe - the tax and spend liberals or the conservatives ?
Here, let me help you with that phrase.

Who do we believe - the tax and spend liberals or the borrow and spend conservatives ?
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 12:43 PM   #4
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Re: Rich get richer / poor get poorer

Quote:
Originally Posted by Nords

As for the rich, why remove their incentive to keep getting richer? For every money-grubbing SOB like Larry Ellison or Donald Trump there's a Bill Gates, a Warren Buffett, and a Ted Turner. It's hard to believe that those three are turning so philanthropical in their later lives, but the same happened with Carnegie, Morgan, & Rockefeller.
Those money grubbing SOBs, nonetheless, provide mucho jobs for Americans and
their products are used by millions of other Americans. But still nice to hear that some of them are turning philantropical.

When the Democrats take power, will America eventually turn into another Europe and lose our inbred incentives to make money on top of more money?
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 12:46 PM   #5
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Re: Rich get richer / poor get poorer

I wonder why the word that I typed "philanthropical" came out as
"philantropical" when my words were posted ?

Borrow and spend ? don't know what you're talking about, ha ha!
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 12:46 PM   #6
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Re: Rich get richer / poor get poorer

Labor Day Report: Working Class Strained by Low Wages, Inequality

The EPI report also argues that the deficit between productivity and worker pay has contributed to the increasing gap between the rich and the poor. The top one percent of Americans controlled almost as much wealth in the year 2000 as their counterparts did in 1929, right before the Great Depression.

The report notes that, adjusting for inflation, between 1979 and 2000 the income of households in the poorest twenty percent grew only 6.4 percent, while the incomes of the richest twenty percent grew 70 percent. The richest one percent of households saw their earnings increase 184 percent.


So, the last time this happened was the Great Depression, and we fixed it with a massive redistribution of wealth via taxation and new social programs.
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 12:49 PM   #7
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Re: Rich get richer / poor get poorer

Wab,
We really didn't fix anything with new social programs; WWII fixed the depression.
The New Deal fixed nothing.
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 12:55 PM   #8
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Re: Rich get richer / poor get poorer

Gotcha. So, the answer is to have WW3. Frankly, if we end up with high unemployment, I'd prefer programs that build our infrastructure. They both result in higher taxation and high employment, but one is less messy than the other.
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 01:01 PM   #9
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Re: Rich get richer / poor get poorer

The New Deal programs fixed a lot.

Many jobs programs put people to work.

Social Security was established.
The Fair Labor Standards Act, abolishing child labor and establishing a minimum wage was established.
The 1933 Securities Act to help control securities fraud was enacted.
The FDIC was formed, bringing back confidence in banks.

Wonderful programs.

This time around I suggest national healthcare and a raise in minimum wage.

Most people on this board are very successful. I often think of how fortunate I am. Not everyone can get the good paying jobs. Many people work hard for not a lot of money. They are not getting ahead.
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 01:15 PM   #10
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Re: Rich get richer / poor get poorer

Quote:
Originally Posted by wab
Gotcha. So, the answer is to have WW3. Frankly, if we end up with high unemployment, I'd prefer programs that build our infrastructure. They both result in higher taxation and high employment, but one is less messy than the other.
Hey smart-aleck: WW3 certainly not and hope you don't believe that's what I was inferring.
.
Higher taxation does not translate into higher employment.
.
There were some New Deal programs that one could agrue as being productive.
But, WWII is what really got us out of the depression and there is no doubt about that.
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 01:34 PM   #11
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Re: Rich get richer / poor get poorer

>>Higher taxation does not translate into higher employment.

And as we have seen with the Bush administration policies, lower taxes also does not contribute to higher employment.
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 01:38 PM   #12
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Re: Rich get richer / poor get poorer

Quote:
Originally Posted by bennevis
But, WWII is what really got us out of the depression and there is no doubt about that.
Isn't a war a massive social program that artifically stimulates employment and the economy? * I guess I don't understand why you make the distinction. * How did we pay for the war? * *IIRC, marginal tax rates were at an all-time low before the Great Depression, and they went to an all-time high after.

We've probably had enough gloom and doom predictions on this board to understand one possible outcome of our economic disparity and current low tax situation. * *We have a structural deficit. * We have artifically stimulated the economy via tax cuts and deficit spending. * We have consumers who were spending more than they were earning by taking out HELOCs.

So, what happens when the artificial tax and spend stimulus winds down? * What happens when the equity boom reverses? * I honestly don't know, but IF we're left with a consumer base who can't afford to consume, one possible outcome is much slower economic growth and much higher unemployment.

So, what is the best fix if we end up with low taxes, low consumption due to wealth disparity, a structural deficit, a slow economy, and high unemployment?
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 01:48 PM   #13
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Re: Rich get richer / poor get poorer

What if NY opened a housing project in northwest Iowa? Or paid for a poor family to move into a remote lower middle class neighborhood? Wait a minute ... isn't this what happened with folks who left New Orleans? Let's see what happens.
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 02:05 PM   #14
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Re: Rich get richer / poor get poorer

The EPI and The NewStandard make for interesting Googling. A more biased pairing would have been difficult to find.
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 02:20 PM   #15
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Re: Rich get richer / poor get poorer

Quote:
Originally Posted by Cut-Throat
Here, let me help you with that phrase.

Who do we believe - the tax and spend liberals or the borrow and spend conservatives ?
Sorry CT, but you were too kind. It should be "borrow and spend more". Tax policy needs to be fair, but whatever it is, outflow must equal inflow. Something neither party seems to understand.
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 02:35 PM   #16
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Re: Rich get richer / poor get poorer

it is interesting to note that the % income going to the top 10% in the U.S. is about the same as China; a tad less than the average of all countries, and below that of Mexico, Russia and Uzbekistan.
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 04:25 PM   #17
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Re: Rich get richer / poor get poorer

It's more like the smart get richer and the dumb get poorer.

Good and bad luck factors in the equation sometimes, but for the most part, smart people create their own luck while dumb people create their own misery.
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 04:55 PM   #18
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Re: Rich get richer / poor get poorer

This data from the census would tend to bear that out.

http://pubdb3.census.gov/macro/03200.../new03_028.htm

It is amazing to see precisely what you would expect -- if you want to make more money, stay in school.
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 06:12 PM   #19
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Re: Rich get richer / poor get poorer

I also think education (or lack of it) is by far the biggest reason for the income disparity and the question should be not how we can make the rich and the poor earn the same, but how we can improve the education of everyone. "Education" should include financial education as well, starting at grade school.

But even forgetting about the lack financial education specifically, American 1-12 grade education system is plain horrible. I grew up in another country and moved to US prior to high school and the difference in education level and quality, especially in math and sciences area, is stunning. American universities are top notch, but the majority of kids' brains are already butchered by the time they get to college age. Surprisingly (to me), the same terrible system somehow produces (or perhaps fails to destroy) the occasional brilliant mind, but there's no quiestion that it definitely does not work for an average kid.

I don't know of any easy solution to improve grades 1-12 education but that's what should be the focus of any effort to better the economic standing of the middle and lower class, not whether to tax the rich more or less. And by the way, improving public education should not need any more money to get better -- it's a matter of spending the money it has already more effectively.

IMO, the simplest and most important step is to dramatically speed up the pace at which curriculum is covered, especially in math/sciences area. Algebra, for example, probably should be taught by grades 7-8, not 11-12...* Anyway, fixing the education system deserves a few threads of its own
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Re: Rich get richer / poor get poorer
Old 09-03-2006, 06:29 PM   #20
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Re: Rich get richer / poor get poorer

Quote:
Originally Posted by Cut-Throat
Here, let me help you with that phrase.

Who do we believe - the tax and spend liberals or the borrow and spend conservatives ?
Unfortunately, it's borrow and spend everybody.* The dems and repubs had not differentiated themselves in this area if the real data is used.
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