Thread: The Blue-State Tax Burden

Originally Posted by Broken

Yes, and his figures covered the 19th century, when the US was a developing nation. By the same reasoning, since both tax rates and growth rates were much higher in the 30s, 40s, 50s, and 60s than they are today, we should return to a 70% marginal tax rate to get the highest growth.

I want the US to continue to develop though. The government is too wasteful, and powerful, to spend the money efficiently, and there's no recourse to force them too.

Originally Posted by Broken

The tax rate in the 90s was just about right

Too high then, and it's barely lower now.

Originally Posted by Broken

a balanced budget

Remove the costs of the war, would the budget be ballanced then?

Originally Posted by Broken

Plenty of people became quite rich

It's not about becoming rich, it's about fairness and freedom.

Originally Posted by Broken

we will never know what he would have enacted

We can look at his past record, and his campaign, to know what he would have tried. Kerry was also for the war, so we can't remove that spending. Tack on 2 trillion for the beginnings of socialized medicine, etc., etc..

Originally Posted by Broken

it is realistic to assume we will need conscription to fill the ranks.

Nope, the occupation of Western Europe, South Korea, Japan, etc. have continued without a draft. That was another good reason to defeat the Democrats, they're the only ones so far that have tried to restart the draft.

Originally Posted by Broken

But if their skills are different, it isn't discrimination, right? Likewise with different taxrates for different incomes.

People should be rewarded for their efforts, not punished.

Originally Posted by Broken

However, when it comes to taxes, any reference to sacrifices for the common good is labeled "class warfare".

When you base it on class, it is class warfare. Descrimination, plain and simple.

Originally Posted by Broken

It is discrimination to ask a minority to bear most of the burden.

I agree, that's why I support fair taxation.

Originally Posted by Broken

progressive taxation is discrimination

Sure is.

Originally Posted by Broken

just like it is discrimination for only young men to have to risk their lives in war.

It's not only young men. It's women too, right up to the mythical "middle age". It's not descrimination to not hire someone that cannot do the job. There is no draft. Would you hire a high school drop out with a 60 IQ to do your taxes?

Originally Posted by Broken

Society benefits those at the top the most

How? What extra rights does society afford them?

Originally Posted by Broken

I have no problem giving 1/3 back to the society

You didn't give it to society, you gave it to the government. I would applaud you if you gave that much to the poor, or needy, or to research, but instead it was wasted. Even an inefficient charity could have done so much more with the same ammount...

Originally Posted by Broken

This society is built on the resources contributed by many wealthy people before me. Why should I be so greedy to not follow their example?

This society is built on the resourcefullness, intelligence, and freedom of Americans. Taxes just built a huge government.

Originally Posted by Broken

not eliminated. Public laws, security, education, basic research, etc., are necessary.

Who said otherwise? I think you're reading more than is written.

Originally Posted by Broken

Institutional investors and mutual funds lost plenty of money on Enron, WorldCom, etc. These funds are not run by stupid people.

Didn't those go down through fraud? Nothing you've proposed would have changed that.

Originally Posted by Broken

Funny how when the "strangling" stops, we have disasters like the 80s Savings & Loan implosion and Enron in 2000.

And when "regulation" becomes government control, you get a great depression. Praxus has this one right.

Originally Posted by Confed999

I want the US to continue to develop though. The government is too wasteful, and powerful, to spend the money efficiently, and there's no recourse to force them too.

I will certainly agree that the government spends way too much. If it was up to me, I would cut a lot of programs, including Defense, and privatize as much as possible.

But we are talking about the top marginal tax rates, not the size of the budget. I presented the tax and growth rate data back in post #46. I challenged you guys to find any evidence in the empirical data that high marginal rates (ie, a progressive tax system) is bad for growth. Evidently there are no takers.

[Taxes were] Too high then, and it's barely lower now.

If you believe that, back it up with it up with some evidence. "Faith based" economic theory doesn't work for me. Taxes in the 90s balanced the budget and the economy was certainly better than it is now.

Remove the costs of the war, would the budget be ballanced then?

Last I checked, the deficit was projected at 460 billion. Way more than the war.

It's not about becoming rich, it's about fairness and freedom.

Last I checked, the BOR doesn't give me freedom from taxes. Speaking of fairness, how fair is it to use your tax money to subsidize the farming industry? How fair is it that the Federal Reserve lends your tax money to the banks for free?How fair is it that the drug industry is protected from foreign competition?

You seem to believe that because someone is highly paid they deserve to be highly paid. Believe me, I have met some idiot CEOs. Many people in high positions not good at their job, they are good at fighting their way to a top position.

I don't remember the wealthy of the sixties whining about taxes being too high. Why are the current crop so greedy?

Nope, the occupation of Western Europe, South Korea, Japan, etc. have continued without a draft. That was another good reason to defeat the Democrats, they're the only ones so far that have tried to restart the draft.

The draft system did not end until the 70s. ODS was the only war since WWI we have fought which didn't end in a draft. I will lay a wager with you that we will not be successful in Iraq before the draft is reinstalled. We may not be successful even with it.

People should be rewarded for their efforts, not punished.

Absolutely! I do not subscribe to the idea that we should tax the wealthy down to the same after-tax earnings as the middle class. Like I said, in the 90s the average CEO made 100 times what his employees made, after taxes. Isn't that reward enough?

When you base it on class, it is class warfare. Descrimination, plain and simple.

Tax is not based on "class", it is based on income. Conscription is not based on class, it is based on age and gender.

The wealthy have been getting a better and better tax deal since the 1950s. Top margins have dropped from 90% to 30%. Cap gains and dividends are taxed even lower. So, where is this "class warfare" against the rich?

How? What extra rights does society afford them [the rich]?

Heh, heh, that's like asking what extra rights does a 500 pound gorilla have? Money may not buy happiness, but it buys power, political influence, better education, good doctors, better service, good tax advice, good lawyers, ....

You didn't give it to society, you gave it to the government.

If you took away government, society would collapse. It is a necessary evil. Tell me what part of government you would do away with.

I would applaud you if you gave that much to the poor, or needy, or to research, but instead it was wasted.

Yep, it was wasted on the defense department, the coast guard, the National Science Foundation, education, NASA, the Federal Reserve, the court system, disaster relief....

Even an inefficient charity could have done so much more with the same ammount...

I give plenty to charitable causes. Schools, shelter services, kids parks, and research, to name a few areas. Many charities I've seen are even more wasteful than the government. Some are downright fraudulent.

This society is built on the resourcefullness, intelligence, and freedom of Americans. Taxes just built a huge government.

I agree with the first staement, but I would add that most of those great Americans were not wealthy. We remember Andrew Carnegie, but not the thousands of hardworking steelmen in his factories.

Taxes do not build huge governments, politicians do. I would like to see government made as small as possible. Then raise the taxes to balance the budget.

Didn't those go down through fraud? Nothing you've proposed would have changed that.

The Savings and Loans collapsed just a few years after they were deregulated. They used their new "freedom" to make stupid investments. And, yes there was fraud.

Enron, WorldCom, Global Crossing, etc collapsed due to accounting fraud. The rules on corporate accounting were relaxed in the mid 90s.

The managers of publicly owned companies have to much power compared to the shareholders who own the company. It is way too difficult to get rid of bad managers. Look at Disney's problem with Eisner. Don't shareholders have rights to their money.

And when "regulation" becomes government control, you get a great depression. Praxus has this one right.

The Great Depression was not caused by any regulation. After the stock market, banks, and farm prices collapsed, regulations were put in place to prevent such disasters. And one hasn't occured since.

Regulations are just laws governing corporate behaviour. Just like civil laws govern your behaviour. Should corporations be above the law? What corporate regulations would you eliminate?

Originally Posted by Broken

I will certainly agree that the government spends way too much. If it was up to me, I would cut a lot of programs, including Defense, and privatize as much as possible.

But we are talking about the top marginal tax rates, not the size of the budget. I presented the tax and growth rate data back in post #46. I challenged you guys to find any evidence in the empirical data that high marginal rates (ie, a progressive tax system) is bad for growth. Evidently there are no takers.

I have never said it is bad for GDP growth. I did however say it is bad for the economy. Companies require capital to innovate and expand their buisness. The vast majority of the income of the people being taxed at the highest ammount are the greatest owners of capital, and the vast ammount of the income goes into capital goods. The only reason it isn't nessecarily bad for Growth (in the short term) is because the Government counts Government spending as part of the GDP. When the Government has no desire to save, it can for a short period expend more money then is normally being traded, but in order to do this you have to take it away from the market, and we all know that the Market is the only way to best distribute the money across the market because of natural incentives such as prices and the like.

If you believe that, back it up with it up with some evidence. "Faith based" economic theory doesn't work for me. Taxes in the 90s balanced the budget and the economy was certainly better than it is now.

So your saying it's not possible to prove economic theory without some historical evidence? When you use historical data like you are doing, you are trying to prove that high tax rates for the high income earners is good for the economy simply by showing that the GDP was growing quickly at the same time as the high tax rates. There are so many other things that the Government carried out, that picking the high tax rates to have caused it is completly arbitrary.

Last I checked, the deficit was projected at 460 billion. Way more than the war.

The welfare state costs us 5 times that ammount of the deficit in a single year.

Last I checked, the BOR doesn't give me freedom from taxes. Speaking of fairness, how fair is it to use your tax money to subsidize the farming industry? How fair is it that the Federal Reserve lends your tax money to the banks for free?How fair is it that the drug industry is protected from foreign competition?

It's not fair, but I really fail to see your point.

Absolutely! I do not subscribe to the idea that we should tax the wealthy down to the same after-tax earnings as the middle class. Like I said, in the 90s the average CEO made 100 times what his employees made, after taxes. Isn't that reward enough?

By what standard it is enough? If you want to act like a barbaric brute, going around pointing guns at people heads because you think they are getting paid to much, then you do it for christ sake. Just don't be a panzy about it and do it through the Government. Come on show us what you real feel, so the world what you want, lead by example!

Tax is not based on "class", it is based on income. Conscription is not based on class, it is based on age and gender.

Your right classes don't exsist.

Heh, heh, that's like asking what extra rights does a 500 pound gorilla have? Money may not buy happiness, but it buys power, political influence, better education, good doctors, better service, good tax advice, good lawyers, ....

How about you answer the damn question.

If you took away government, society would collapse. It is a necessary evil. Tell me what part of government you would do away with.

Wrong, proper Government is a nessecary good. Our Government now is an unessecary evil.

Yep, it was wasted on the defense department, the coast guard, the National Science Foundation, education, NASA, the Federal Reserve, the court system, disaster relief....

Ugh, the Federal Reserve, the most vial institution in the United States today. You know how much of it goes to the things you listed? Less then half of it!

I give plenty to charitable causes. Schools, shelter services, kids parks, and research, to name a few areas. Many charities I've seen are even more wasteful than the government. Some are downright fraudulent.

I don't give any charity except to thoose I deem deserving, nor should I.

Taxes do not build huge governments, politicians do. I would like to see government made as small as possible. Then raise the taxes to balance the budget.

You seem more then willing to loot and pillage in the name of the so called "needy". How can you possibly want a small Government when you want there to be a welfare state?

The Savings and Loans collapsed just a few years after they were deregulated. They used their new "freedom" to make stupid investments. And, yes there was fraud.

Fraud is seperate from regulations.

Enron, WorldCom, Global Crossing, etc collapsed due to accounting fraud. The rules on corporate accounting were relaxed in the mid 90s.

See Last.

The managers of publicly owned companies have to much power compared to the shareholders who own the company. It is way too difficult to get rid of bad managers. Look at Disney's problem with Eisner. Don't shareholders have rights to their money.

You mean the people elected by the shareholders have to much power relitive to the shareholders? The shareholders have the supreme power, they can sell their stock!

The Great Depression was not caused by any regulation. After the stock market, banks, and farm prices collapsed, regulations were put in place to prevent such disasters. And one hasn't occured since.

Your right, it was caused by the Fed. Booms and busts are not a natural part of the market. Every single boom and bust is the result of the Government messing with the money supply.

Regulations are just laws governing corporate behaviour. Just like civil laws govern your behaviour. Should corporations be above the law? What corporate regulations would you eliminate?

Corporations are a collection of several individuals, why should they be regulated when the Individual by right is not and should not? Regulations are not just laws, they are not designed to protect the rights put forth in the Declaration of Independence. They are laws based on bad reasoning that does far more harm then good.

As for Regulations and Agencies, anything not limited to the protection against force and fraud should be repealed. All agencies excluding the Military, Courts, Legislature, Executive branch, and Police should be dispanded as well.

How did Roosevelt prolong the Depression? The US economy had returned to 1928 levels by the end of his first administration. Roosevelt backed off on the New Deal in 1937 (with some help fromf the Supreme Court, which declared many of his programs unconstitutional), and the economy went into temporary recession in 1938. Roosevelt's second New Deal, in 1938, was followed by an expansion until 1940. After that, the buildup to WWII took over.

This is just wrong, even if you include all the Government Employment by 1940 the unemployment rate was still 14.6% which is 4 times greater then in 1929 (3.2%).

After his first term in office the unemployment rate was 16.9% which was over 5 times that of the 1929 level. In fact the average unemployment during the time of FDR was 17%!

Furthermore per capita GNP didn't recover to their 1929 level until 1940! If you look at how much the average person was spending, it didn't reach the 1929 level until after 1940. During the same time period private investment was down by over 3.1 billion dollars.

The true return to prosperity didn't come until after WW2 when the economic controls and federal budget was drasticly decreased. In fact private investment didn't start booming again until the Federal Budget was cut by 1/3rd in 1946.

Originally Posted by Broken

is bad for growth.

Well if we've decided it is not bad for growth, or good for growth, then I choose lower taxes.

Originally Posted by Broken

If you believe that, back it up with it up with some evidence. "Faith based" economic theory doesn't work for me. Taxes in the 90s balanced the budget and the economy was certainly better than it is now.

According to the numbers it's going about the same, in spite of the terrorist attack that hurt our economy.

Originally Posted by Broken

Last I checked, the deficit was projected at 460 billion. Way more than the war.

You have to include homeland defence, payments to "allies", bailouts of affected industry, etc., etc.. Besides the perscription drug plan, a plan the Dems complained wasn't enough, what is Bush's big money difference?

Originally Posted by Broken

Last I checked, the BOR doesn't give me freedom from taxes.

Last I checked, nobody said it did.

Originally Posted by Broken

Speaking of fairness, how fair is it to use your tax money to subsidize the farming industry? How fair is it that the Federal Reserve lends your tax money to the banks for free?How fair is it that the drug industry is protected from foreign competition?

It's not. The government needs to get out of the economy. Removing funds will end these expenditures.

Originally Posted by Broken

You seem to believe that because someone is highly paid they deserve to be highly paid.

I can tell from your posts, you have no idea what I believe.

Originally Posted by Broken

The draft system did not end until the 70s.

We're still in all those places though...

Originally Posted by Broken

Tax is not based on "class", it is based on income.

Hmmmm, then how can a tax law help the middle class? Class in this country is based on how much money you have. Call it "economic" warfare instead if you wish, same deal.

Originally Posted by Broken

Top margins have dropped from 90% to 30%.

35%, but that's just federal income tax, there are alot more taxes out there.

Originally Posted by Broken

So, where is this "class warfare" against the rich?

It's in the descrimination.

Originally Posted by Broken

Heh, heh, that's like asking what extra rights does a 500 pound gorilla have? Money may not buy happiness, but it buys power, political influence, better education, good doctors, better service, good tax advice, good lawyers, ....

In other words, none.

Originally Posted by Broken

If you took away government, society would collapse. It is a necessary evil. Tell me what part of government you would do away with.

I'm still trying to figure out where you got that I want all government removed? My views on government max out around the Libertaian party platform. If it isn't in the Constitution, it's not the government's job.

Originally Posted by Broken

Yep, it was wasted on the defense department, the coast guard, the National Science Foundation, education, NASA, the Federal Reserve, the court system, disaster relief....

The half that was wasted went into doing the paperwork required just to get it to those places. Sad you don't see all that. You do realize you can give more than your 1/3, right? Or move to a more socialist nation?

Originally Posted by Broken

Many charities I've seen are even more wasteful than the government. Some are downright fraudulent.

But you see, you get to choose, and you have recourse. None of that with the government.

Originally Posted by Broken

but I would add that most of those great Americans were not wealthy.

Well, I never did mention money...

Originally Posted by Broken

Taxes do not build huge governments, politicians do.

What do they use to finance the building? Yeah, taxes...

Originally Posted by Broken

Then raise the taxes to balance the budget.

Reduce taxes and force them to reduce spending.

Originally Posted by Broken

And, yes there was fraud.

Enron, WorldCom, Global Crossing, etc collapsed due to accounting fraud. The rules on corporate accounting were relaxed in the mid 90s.

Yeah, I know, like I said.

Originally Posted by Broken

Don't shareholders have rights to their money.

Yeah, don't invest in that...

Originally Posted by Broken

The Great Depression was not caused by any regulation.

Sure it was, fiddle with intrest rates too much, add too many taxes and tarrifs, and see if it doesn't happen again.

Originally Posted by Broken

Regulations are just laws governing corporate behaviour.

That's what they're supposed to be, but federal regulation has come to mean alot more than that. They're supposed to be in place to prevent fraud, but now they can be used for any sillyness, most of which involves yet another government buracracy.

Originally Posted by Broken

What corporate regulations would you eliminate?

All of the ones that are unfair. I'll toss out one that will get you going though, Workman's Comp insurance...

Originally Posted by Confed999

Well if we've decided it is not bad for growth, or good for growth, then I choose lower taxes.

I choose lower taxes, too. It is the distribution of taxes you and I disagree on, not the cost of government. I don't think anyone would disagree that the government could spend less. Much less.

Over the last 50 years, the tax system has become less and less progressive. Consequently, the wealth distribution has become more and more one-sided. The top 5% controlled 60% of all wealth in 2000. If we eliminate a progressive system entirely, wealth will become even more concentrated. Why is this a desirable result? Why should policy benefit only a tiny minority?

I think there is a happy medium, a wealth distribution which gives incentives and rewards for high achievement, but does not stifle the upward mobility of the middle income brackets. I am greatful for a system which allowed me to rise from modest means. I am not so greedy that I would deny that opportunity to future generations of Americans.

That's all I have time for. Merry Christmas!

Over the last 50 years, the tax system has become less and less progressive. Consequently, the wealth distribution has become more and more one-sided. The top 5% controlled 60% of all wealth in 2000. If we eliminate a progressive system entirely, wealth will become even more concentrated. Why is this a desirable result? Why should policy benefit only a tiny minority?

So if I aquire 200 times more wealth then I did last year and another person had 2 times more wealth then he did last year. Tell me is the person that has twice as much wealth as he had worse off then he was the year before when he had half as much? Are you further going to say that the policy only benefited me who has 200 times more wealth?

You are confusing political and economic power, please stop doing it.

Originally Posted by Broken

If we eliminate a progressive system entirely, wealth will become even more concentrated. Why is this a desirable result? Why should policy benefit only a tiny minority?

Why should policy take more from a minority? If I believe in equal rights, I can't believe in unequal taxation. Why do I care who has what? I'm not the envious type, at least about something as silly as money. Everyone except the poor should pay their fair share, realize this also means I would have to pay more. Currently I'm for the "fair tax", national sales tax plan. It would be a boom for the economy, both rich and poor, and make American products less expensive. It would encourage investment, and rid us of a chunk of our buracracy. At least in theroy.

Originally Posted by Broken

I am not so greedy that I would deny that opportunity to future generations of Americans.

I am not in an upper income tax bracket, so I do not speak from a greed standpoint. I will allways stand for equal rights, no matter what the issue is.

When it comes to rights, there can be no middle ground. The living have choosen life in society, and rights as put forth by the Enlightment Thinkers (John Locke, Jefferson, Montesque, Bastiat, etc...) are the only means to preserve life within the context of other beings. When one steps outside the realm of rights and dismisses them, all that can come is death, the negation of life.

Suppose that every day 10 men go to a restaurant for dinner. The bill for all ten comes to $100. If it was paid the way we pay our taxes, the first four men would pay nothing; the fifth would pay $1; the sixth would pay $3; the seventh $7; the eighth $12; the ninth $18. The tenth man (the richest) would pay $59.
The 10 men ate dinner in the restaurant every day and seemed quite happy with the arrangement until the owner threw them a curve. Since you are all such good customers, he said, I'm going to reduce the cost of your daily meal by $20. Now dinner for the 10 only costs $80. The first four are unaffected. They still eat for free. Can you figure out how to divvy up the $20 savings among the remaining six so that everyone gets his fair share?

The men realize that $20 divided by 6 is $3.33, but if they subtract that from everybody's share, then the fifth man and the sixth man would end up being paid to eat their meal.

The restaurant owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay. And so now the fifth man paid nothing, the sixth pitched in $2, the seventh paid $5, the eighth paid $9, the ninth paid $12, leaving the tenth man with a bill of $52 instead of $59.

Outside the restaurant, the men began to compare their savings. "I only got a dollar out of the $20," complained the sixth man, pointing to the tenth, "and he got $7!" "Yeah, that's right," exclaimed the fifth man. "I only saved a dollar, too. It's unfair that he got seven times more than me!" "That's true," shouted the seventh man. "Why should he get $7 back when I got only $2? The wealthy get all the breaks!"

"Wait a minute," yelled the first four men in unison. "We didn't get anything at all. The system exploits the poor." The nine men surrounded the tenth and beat him up. The next night he didn't show up for dinner, so the nine sat down and ate without him. But when it came time to pay the bill, they discovered something important. They were $52 short!

And that, boys, girls and college instructors, is how America's tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up at the table any more. There are lots of good restaurants in Switzerland and the Caribbean!

Originally Posted by Veni Vidi Vici

And that, boys, girls and college instructors, is how America's tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up at the table any more. There are lots of good restaurants in Switzerland and the Caribbean!

Yes Ma'am, good post...

I can't argue with it.

I found an interesting article you should consider. But first a reminder of where we were at before Christmas:

Originally Posted by Broken

Over the last 50 years, the tax system has become less and less progressive. Consequently, the wealth distribution has become more and more one-sided. The top 5% controlled 60% of all wealth in 2000. If we eliminate a progressive system entirely, wealth will become even more concentrated. Why is this a desirable result? Why should policy benefit only a tiny minority?

I think there is a happy medium, a wealth distribution which gives incentives and rewards for high achievement, but does not stifle the upward mobility of the middle income brackets. I am greatful for a system which allowed me to rise from modest means. I am not so greedy that I would deny that opportunity to future generations of Americans.

Originally Posted by Confed999

Why should policy take more from a minority? If I believe in equal rights, I can't believe in unequal taxation. Why do I care who has what? I'm not the envious type, at least about something as silly as money. Everyone except the poor should pay their fair share, realize this also means I would have to pay more. Currently I'm for the "fair tax", national sales tax plan. It would be a boom for the economy, both rich and poor, and make American products less expensive. It would encourage investment, and rid us of a chunk of our buracracy. At least in theroy.

I am not in an upper income tax bracket, so I do not speak from a greed standpoint. I will allways stand for equal rights, no matter what the issue is.

On this theme, an interesting article from the Financial Times :

Whatever happened to the belief that any American could get to the top?

THE United States likes to think of itself as the very embodiment of meritocracy: a country where people are judged on their individual abilities rather than their family connections. The original colonies were settled by refugees from a Europe in which the restrictions on social mobility were woven into the fabric of the state, and the American revolution was partly a revolt against feudalism. From the outset, Americans believed that equality of opportunity gave them an edge over the Old World, freeing them from debilitating snobberies and at the same time enabling everyone to benefit from the abilities of the entire population. They still do.

To be sure, America has often betrayed its fine ideals. The Founding Fathers did not admit women or blacks to their meritocratic republic. The country's elites have repeatedly flirted with the aristocratic principle, whether among the brahmins of Boston or, more flagrantly, the rural ruling class in the South. Yet America has repeatedly succeeded in living up to its best self, and today most Americans believe that their country still does a reasonable job of providing opportunities for everybody, including blacks and women. In Europe, majorities of people in every country except Britain, the Czech Republic and Slovakia believe that forces beyond their personal control determine their success. In America only 32% take such a fatalistic view.

But are they right? A growing body of evidence suggests that the meritocratic ideal is in trouble in America. Income inequality is growing to levels not seen since the Gilded Age, around the 1880s. But social mobility is not increasing at anything like the same pace: would-be Horatio Algers are finding it no easier to climb from rags to riches, while the children of the privileged have a greater chance of staying at the top of the social heap. The United States risks calcifying into a European-style class-based society.

The past couple of decades have seen a huge increase in inequality in America. The Economic Policy Institute, a Washington think-tank, argues that between 1979 and 2000 the real income of households in the lowest fifth (the bottom 20% of earners) grew by 6.4%, while that of households in the top fifth grew by 70%. The family income of the top 1% grew by 184%—and that of the top 0.1% or 0.01% grew even faster. Back in 1979 the average income of the top 1% was 133 times that of the bottom 20%; by 2000 the income of the top 1% had risen to 189 times that of the bottom fifth.

Thirty years ago the average real annual compensation of the top 100 chief executives was $1.3m: 39 times the pay of the average worker. Today it is $37.5m: over 1,000 times the pay of the average worker. In 2001 the top 1% of households earned 20% of all income and held 33.4% of all net worth. Not since pre-Depression days has the top 1% taken such a big whack.

The rest of the article can be found at the above link.