Step one: elect a communist POTUS.
It’s so artfully done, and so diabolical, that one can picture secret seminars in subterranean Wall Street meeting rooms, guiding young business recruits in the proven process of taking an extra share of wealth from the middle class. Their presentation might unfold as follows:
1. Boost productivity while keeping worker wages flat.
The trend is unmistakable, and startling: productivity has continued unabated while wages have simply stopped growing. Improved technologies have reduced the need for workers while globalization has introduced the corporate world to cheap labor. In effect, the workers who built a productive America over a half-century stopped getting paid for their efforts.
Paul Krugman suggests that a “sharp increase in monopoly power” is another reason for the disparity. As John D. Rockefeller said, “Competition is a sin.” That certainly is the rule of thumb in banking and agriculture and health insurance and cell phones. Yet despite the fact that low-wage jobs are increasingly defining the American labor market, apologists for our meager minimum wage claim an increase will worsen unemployment. So it remains at $7.25. A minimum wage linked to productivity would be $21.00 per hour.
2. Build up a financial industry that has no maximum wage.
This is where the money is. In 2007, before the financial crisis, a Harvard survey revealed that almost half of the school’s seniors aspired to careers in finance. The industry’s share of corporate profits grew from 16% in 1980 to an astonishing 45% in 2002.
And there’s no limit to the earning potential. Hedge fund manager John Paulson conspired with Goldman Sachs in 2007 to bundle sure-to-fail subprime mortgages in attractive packages, with just enough time for Paulson to collect other people’s money to bet against his personally designed financial instruments. He made $3.7 billion, enough to pay the salaries of 100,000 new teachers.
3. Keep accumulating wealth created by the financial industry.
Experienced schemers have undoubtedly observed that over the past 100 years the stock market has grown three times faster than the GDP. The richest quintile of Americans owns93% of such non-home wealth.
In the last 25 years, only the richest 5% of Americans have increased their share of non-home wealth, by the impressive rate of almost 20 percent.
In just one year, the richest 20 Americans earned more from their investments than the entireU.S. education budget.
4. Tax yourself as little as possible.
The easiest and least productive way to make money – holding on to investments – is also taxed at the lowest rate. In addition to the capital gains benefit, tax ploys like carried interest, performance-related pay, stock options, and deferred compensation allow hedge fund managers and CEOs to pay less than low-income Americans, and possibly evennothing at all.
The richest 400 taxpayers doubled their income in just seven years while cutting their tax rates nearly in half. U.S. corporations can match that, doubling their profits and cutting their taxes by more than half in under ten years. The 1.3 million individuals in the richest 1% cut their federal tax burden from 34% to 23% in just 25 years.
5. Lend out your excess money to people who can no longer afford a middle-class lifestyle.
As stated by Thom Hartmann, “The ‘Takers’ own vast wealth, and loan it out at interest to everybody from students to governments..” Overall, Americans are burdened with over $11 trillion in consumer debt, including mortgages, student loans, and credit card liabilities.
Wealth has largely disappeared for the middle- and lower-income classes. More than $7 trillion has been lost in the decline of home prices since 2006. Young college graduates have an average of $27,200 in student loans, and the 21-35 age group has lost 68% of its median net worth since 1984, leaving each of them about $4,000. Median net worth for single black and Hispanic women is a little over $100.
So we’re hanging on by the frazzled thread of debt that indentures us to the rich and makes it harder and harder to fight back against the theft of our middle-class wealth. As we struggle to support ourselves, the super-rich remain on the take, driving us ever closer to the status of most wealth-unequal country in the world.
As a squarely Middle-Class person, lets see......
Productivity =/= Wage Rates for a reason. It's what it takes to do the work that sets it's value, not how productive it is.
For example, if we set wages based only on productivity, many Teachers would not make much, and would face vastly higher standards and testing of their students to see, in quantifyable fact, how "productive" their teaching has been.
How would you feel if I told you that I would set YOUR "maximum wage"?2. Build up a financial industry that has no maximum wage.
What right does a State have to tell free individuals how much they can make?
And what is your solution to the supposed problem? Disallow the Fincnace Industry and Stock Market? Confiscate the Wealth for Redistribution?3. Keep accumulating wealth created by the financial industry.
I'd also ask why this matters to you, how much welath someone else has? Them having that wealth did not take wealth from you, did not limit your freedom to work or earn wealth, did not bar you from finance yourself, and did provide a large portion of teh tax total provided to he Govt.
So other than base "they have more than me, boo hoo" jealousy, whats the problem exactly?
Tax everyone as little as possible.4. Tax yourself as little as possible.
The fact this is even controversial is a bit scary.
Actually, the easiest and least productive way to make money is to collect social welfare benefits and tax credits.The easiest and least productive way to make money – holding on to investments – is also taxed at the lowest rate.
Investments actually work harder and have a far greater impact than any welfare recipient does working (or not).
And if they didn't lend money, they'd be forced to by the State. Damned if they do, damned if they don't.5. Lend out your excess money to people who can no longer afford a middle-class lifestyle.
Mr. Hartmann is a Communist in everything but name, and feels that all wealth should be collectivised, all labor forced into Unions, and all workers provided an extensive list of social services free of charge, except you know that 100% tax rate thing. The man is as much a Stalinist as there is.
As a midde class person, I don't fee "cheated" by any of these things.
If I want more wages, I earn them by changing employment to better alternatives in better areas, by aquiring additionals chooling or training, and by the excellence of my work. And it's worked thus far, my wages are far in excess of my fathers, and my own in my youth.
I don't care how much other make, it's none of my business, and it doesn't come from me.
I don't care what percentage of total wealth my "wealth class" posesses. It's irrelevant to me on a day to day basis, and an acedemic, not real world, argument. I care what I posess, and how I earn it.
I want taxes on everyone to be a little as possible, to provide only the base required spending the Govt. should be doing. Hint, yes it does nclude a social safety net, but no, nothign close to what our Federal spends today.
And finally, as I've said many times, I believe in a flat tax or a consuption tax. Under Flat Tax, all wages, regardless or source, are taxed at the same rate. Under consumption, no wages are taxed, only non-vital purchases, and all at the same rate. I'm all for equal taxation for everyone. and I mean everyone, the growing percentage who are net recipients of tax money, and pay no net taxes, cocnern me far more than the rich paying the vast majority of taxes trying to keep a bit more of what they earned.
Get ready for the world of robotics taking on lower and lower skilled work. Worldwide demand for workers is going to be crushed. Unskilled middle class wages will be gone. This is not a conspiracy this is the reality of technology and economics. It will impact workers in Ohio and Shanghai.
The private sector pays the going rate(many more college graduates today then ever) more people to pick from. The government sector pays allot more because they just raise taxes to pay for it. These are my observations from a HS graduate.
Krugman has become more dooshbag partisan than economist.
The middle class is actually under extreme attack from the governments rising tax burden.
State, local and federal taxation to pay for benefits and other entitlements not available to the true middle class is driving the middle class down.
Case in point: Obamacare alone is likely to double the average cost of health insurance premiums. Sure, part of that is passed on to employers, but they simply make up for it by reducing payroll one way or another. So not only are the middle class forced to pay more, but their merit increases and bonuses drop. That is, if they're lucky enough to keep their job.
What better way to fund a program while claiming it doesn't raise taxes?
It's not that liberals are stupid it's that they don't care who knows it.
Politics Lesson: Teleprompters make lousy leaders.