who's that damn stock guru on IM? i got some questions!!
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By Jesse Drucker, The Wall Street Journal
Last update: 12:33 a.m. EDT July 23, 2008
In a new sign of increasing inequality in the U.S., the richest 1% of Americans in 2006 garnered the highest share of the nation's adjusted gross income for two decades, and possibly the highest since 1929, according to Internal Revenue Service data.
Meanwhile, the average tax rate of the wealthiest 1% fell to its lowest level in at least 18 years. The group's share of the tax burden has risen, though not as quickly as its share of income.
The figures are from the IRS's income-statistics division and were posted on the agency's Web site last week. The 2006 data are the most recent available.
The figures about the relative income and tax rates of the wealthiest Americans come as the presumptive presidential candidates are in a debate about taxes. Congress and the next president will have to decide whether to extend several Bush-era tax cuts, including the 2003 reduction in tax rates on capital gains and dividends. Experts said those tax cuts in particular are playing a major role in falling tax rates for the very wealthy.
Sen. John McCain has proposed extending the lower tax rates of 15% on long-term capital gains and dividends that apply to most taxpayers, while Sen. Barack Obama has said he will seek to raise them to at least 20%, the rate before the 2003 cut, and possibly higher.
According to the figures, the richest 1% reported 22% of the nation's total adjusted gross income in 2006. That is up from 21.2% a year earlier, and is the highest in the 19 years that the IRS has kept strictly comparable figures. The 1988 level was 15.2%. Earlier IRS data show the last year the share of income belonging to the top 1% was at such a high level as it was in 2006 was in 1929, but changes in measuring income make a precise comparison difficult.
The average tax rate in 2006 for the top 1%, based on adjusted gross income, was 22.8%, down slightly from 2005 and the fifth straight year of declines. The average tax rate of this group was 28.9% in 1996, and was 24% in 1988.
As the wealthiest Americans' share of income has risen, so has their share of the income-tax burden. The group paid 39.9% of all income taxes in 2006, compared with 27.6% in 1988. In the most recently reported five years, however, the share of income reported by the very wealthy has risen faster than the group's share of income taxes.
The IRS data look only at so-called adjusted gross income, which is reported on tax returns, and focus only on income taxes. A report by the Congressional Budget Office late last year, which used wider definitions of both income and taxes, found similar trends.
Joel Slemrod, a tax economist at the University of Michigan's business school, said that some portion of the increase in income for the top 1% could stem from the increasing shift to entities such as partnerships, which means some income previously reported by businesses is now reported by individuals. Larger factors likely include changes in trade policy and other aspects of the increasingly global economy, he said.
who's that damn stock guru on IM? i got some questions!!
Someone in the top 1% pays 667 times what the average American pays in taxes. 667 TIMES as much. Anyone who thinks this inequality needs to grow is a fucking socialist, that is all there is to it.
The government provides services. When you get your oil change or your hair cut, do they charge you based on the value of what they provide, or do they charge you based on a % of your annual income? This idea that people should pay for the governments services based on a percentage of their income, and that this percentage should be higher for people who make more, just has no logical basis in fact or reality. Imagine walking into a bar with your friend and you each order a beer. The bartender charges your friend $1, and charges you $667. Then your liberal friend who just got charged $1 starts complaining about 'price cuts for the rich,' and says that your beer should cost $1,000 and his should be free.
The rich receive more government services and of a higher quality...law enforcement, public education etc. You are basing your argument on the assumption that all government services are equal.
If your friend gets a 1USD drink from the liquid in the bar mat and you get a 667USD dollar drink of fine cognac, then it doesn't seem as unequal...just sayin' its not as clear cut as your analogy states...but all in all I do agree with your overall message...just not your premise.
It's funny about the way those graphs are lined up.
Their share of the income is ~22%, and their share of the taxes is ~40%. This seems fair!
One graph is in 5% gradations the other in 10%.
A clever attempt using deception to incite class warfare/wealth envy. But, any person who actually pays attention can see right through it.
Last edited by brogers; 07-25-2008 at 08:58 AM.
IMO if uncle sam can take 30-40% of my pay check they can do the same to the rich. Why are we the only ones that gotta suffer and work 2-3 jobs for a peice of shyt check.
JailHouse you do realize we have a "progressive" tax system here where the rich pay a higher percentage of their income in taxes, right?
Your statement makes no sense...
I'd also like to say that this article embodies pretty much everything that is wrong with modern liberals. High-income earners' tax RATES have fallen, but the proportion of the burden they are carrying has RISEN. This falls perfectly in line with conservative tax theory: when you oppressively tax those who drive our economy, everyone suffers. Less investment, less entrepenuership, less small business growth mean less jobs for Americans. You can actually increase tax revenue by reducing tax rates because it stimulates economic growth.
Yet for liberals taxes are a form of punishment inspired by class envy. They don't want to raise taxes because we need the money, they don't want to raise taxes because it would be good for America. According to liberals, we need to raise taxes simply because some people aren't paying "enough."
Obama was debating on the capital gains taxes, and he was asked directly why we should raise capital gains taxes in the face of widely-accepted evidence that it actually lowers revenue. All he said was that we need to make sure wealthy people are paying more taxes. That is flat fucking socialism. It is class warfare that is hurting America based on the small-minded envy of ultra-leftists.
i was reading an article on the inheritance tax where it is something like 45% tell me how this effects the ultra rich? well if the value of the yankees is 1.3 billion and he dies. his sons now need to come up with 45% of that just to keep running the damn team.
I really don't get the hatred toward the "rich." When some really rich person buys a yacht or a private jet, people and businesses are getting paid to build it, service it, operate it, etc. What's a better idea? Take their money and give it to government bureaucracies that produce absolutely zilch?
The exchange of goods and services in the economy creates value for all parties involved, at every level. This is one of the simplest and most basic principles of economics. Even someone who is paying $4.00 per gallon of gas is gaining value by purchasing that gasoline.
Increasing taxes on the "rich" does nothing but spread misery.
The American tax system hurts most the people making between $80k and $300k. For the most part, these are the people who earned what they have. They took substantial risk and put hard work into starting a business, or becoming a doctor, lawyer, engineer, accountant, etc. It takes a lot of time, a lot of hard earned success, and usually requires people to go into substantial debt. Dems always like to frame the argument in terms of billionares who inherit everything they get and get into any school they want because of their name, etc. The Bushs and Kennedys of this world are few and far between, the people you are really hurting are the ones providing jobs to your local community or rendering valuable professional services.
Law enforcement is most definitely federal...but thats besides the point.
We are also taxed locally...at least most states have a state income tax as well as sales taxes. In fact some municipalities have income taxes! which clearly feeds into the education system.
I do agree with the theory, but don't forget to consider the source
In large, I'd rather some rich person or family circumvent taxes than pass it along to the gov't so that it can be wasted on ridiculous projects and overpriced goods/services from gov't contractors.
I have a better idea. How about we stop wasting fucking tax money, then we can lower taxes for EVERYONE?
I like the sound of that far better.
Ron Paul 2012
No gym for home, work out floor with 30, but is it for 20 like 30 lb when you no lift it to be for men, for 30 lbs instead? or half is 10 for 20 pounds?
I agree. I think anyone who is going to vote for Obama, who has promised to raise taxes, ought to have a really excellent reason why 2.7 trillion/year isn't enough. The Federal Government spends Bill Gates' entire net worth every week. They spend three times the average American's salary every second. These taxes don't include the roads, police protection, fire protection, local public schools, etc. that people consider as the most important things the government provides.
The Federal Government spends too much god damned money any way you look at it. Anyone who thinks we need to give them a bigger allowance is a fucking moron.