Are people finally okay with it? I mean folks do not want to cut Entitlements or Defense spending. (vast majority of Federal spending)
So the money needs to come from somewhere. And we certainly are not going to get it from the lower 75th percentile. What other choices do we have?
22 comments:
I suppose it does not matter since it is likely that these voters are split between the 2 parties. Meaning that issues like abortion are deemed more important.
Silly goose. Cut spending, reform entitlements, and quit pretending we can tax the rich enough to continue spending ourselves into prosperity. It's an easy message to sell, politically, but entirely impractical. And the correct date for entitlements to consume all federal tax revenue is about 2030, not 2050.
Yes. I know your idea of "reform entitlements"... Keep yours the same and cut them for others. :-O
As for cutting "discretionary" spending, unfortunately it is now such a small part of the budget that it may not matter unless we eliminate it all.
I do agree that getting a trillion / year out of the top 1% would be a stretch.
CBO Long Term Forecast
2019 Discretionary Spend Graphic
Since discretionary is so small, reforming entitlements is the only answer.
A lot of spending is on automatic pilot. We are getting older, and old people both cost more and produce less. We talk about cuts in spending because we don't want to talk about what cuts in spending mean. Where did old people get the notion that they were "entitled" to a decent life? Where did they get the notion that they had a right to health care that they can afford? Maybe it's those assumptions we should revisit.
--Hiram
People have been ok with taxing the rich for a long time. It's Congress that hasn't been on board, largely because rich people are the ones who fund campaigns and hire ex-politicians for well-paying glad-handing jobs after they are out of office.
Sean,
I am not sure I agree. Many of us have friends and family in the "1%" and they do not seem that rich because most of their wealth is invested.
And they often live rather frugally and re-invest their incomes.
That is how they got rich... That and inheriting or marrying well. :-)
There's literally years of polling data here that indicates broad public support for raising taxes on the wealthy.
Polling Report: Budget/Taxes
If 65% support more progressive taxation.
And 35% of them are DEMs... And 20% do not vote... And 10% are GOPers who are more worried about abortion.
It is going to be a LONG time before things change... :-O
The problem with opinion polls is that uninformed, misinformed, the deliberately ignorant and those unable to think through such issues, are all considered "equal" in the value of their opinion. Tell them there isn't enough money, if you simply confiscated all the wealth of the 1%, to cover the deficit (and you can only do it one time), and see if that registers with them. Unfortunately, such facts and reality won't matter to most of them.
I am pretty sure the top 1% could scrape up $1 trillion per year.
I mean it is only 1,000 billions...
Of course that means they would be selling stock which reduce the value of all of our 401K, IRAs, Pension funds, etc.
Jerry, I often wonder how you come up with your opinions.
The wealthiest 1% of Americans controlled about $41.52 trillion in the first quarter, according to Federal Reserve data released Monday. Yet the bottom 50% of Americans only controlled about $2.62 trillion collectively, which is roughly 16 times less than those in the top 1%.
Wealth across all U.S. households increased during the first quarter. Overall, the net worth of households and nonprofits rose to $136.9 trillion during the first quarter, a 3.8% increase from the end of 2020, according to separate data published by the Federal Reserve on June 10, 2021. But those gains weren’t distributed equally.
And that 41.52 trillion goes largely untaxed.
--Hiram
Well I am not sure if I agree with that.
A lot of that is property, on which property taxes are paid.
A lot of that funds companies who pay all kinds of taxes.
Many of these holdings pay dividends on which taxes are paid.
And of course there is all the charitable giving that funds so many things in our communities.
It is not like rich people have a money safe like Scrooge McDuck.
I was misinformed. Apparently you can tax the incomes of the top1% at100% and not cover the deficit. And know that will not happen the following year.
Jerry,
If they are worth $41.52 Trillion, I sure hope they are earning 5+% on that.
So their increased wealth each year at a minimum is $2.076 trillion per year.
It seems they could definitely make a big dent in the deficit without impacting the way of life.
Though I agree that half of the dent should be made by cutting spending.
A lot of that funds companies who pay all kinds of taxes.
Stocks do not fund companies. When you buy a share of stock in a company, the money goes to the person you purchased it from, not to the company. Tax avoidance is one of the best reasons I know of to own stock
--Hiram
I think you are being way too simplistic.
The Market Value of a company often determines if it stays in business or get sliced to bits.
There are indirect effects of stock price. In olden times, corporate raiders used to analyze corporate values, and if they found the sum of the parts exceeded the market value, they might try to buy it in order to break it up and sell off it's parts. That was never easy to do, because it can be very difficult to untangle companies, and what tended to happen back then was as a company came into play it's stock price would rise to reflect the theoretical valuation. Now that the game is better understood, and that the market has learned to price assets more efficiently, that sort of thing doesn't seem to happen much anymore.
If a company is consistently undervalued in the market, stockholders will get unhappy and in theory might pressure the company to do something, but that doesn't happen much because stockholders have very limited power. It's just easier to sell the stock.
--Hiram
We always think of someone like Jeff Bezos' net worth as the market value of his stock in Amazon. Various plans for taxing wealth assume that. But if Bezos tried to sell his total shares of Amazon all at once, the value would drop precipitously. Knowing that, it is impossible to say what his shares are actually worth at any given time.
--Hiram
Unfortunately the management of my current employer let the stock price drop too much just last year. So another company bought us, are keeping what they want and are working to sell the part that pays my salary.
Hopefully they like us and me... :-)
Ah... You do not know what Jeff is actually worth and yet you want to tax him on it... So confusing...
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