Do Taxes Narrow the Wealth Gap?: NYT Debates

New York Times:

What role, if any, does tax policy play in creating a wealth gap in the United States?

Read the whole story: New York Times

Comments

[StopMakingSense2]

02:47 PM on 09/21/2011

Ask the rest of the 1st world! As we continue our slide to 3rd world status. But we're the smart ones.... Right..........

[Patriot86]

08:06 AM on 09/21/2011

A combination of taxes and trade reform will narrow the gap...the outsourcing tax must go and NO TAX HOLIDAY which will encourage thousands of Americans to move more jobs overseas as they would pay lower wages and no taxes.

[zelda777]

07:12 PM on 09/20/2011

This article articulates exactly what I've been saying for a while. Many easily deluded people bash the idea of raising taxes on the wealthy because of their own illusion that if they, themselves, work very, very, very hard, that they, too, can become billionaires. There is a very unhealthy identification with the wealthy class in the US - witness the whole Paris Hilton or "Lifestyles of the Rich and Famous" phenomena.

Here is a study with color charts towards the end which demonstrate the largely held ignorance of wealth distribution matters:

http://www.people.hbs.edu/mnorton/norton%20ariely%20in%20press.pdf

[Patriot86]

08:07 AM on 09/21/2011

Michael Moore addressed this some years ago... at the time I thought him arrogant but now I understand what he meant.

[StopMakingSense2]

02:49 PM on 09/21/2011

Are you a conservative? If so this is a miracle! It must have finally happened to you too!

[Neets101]

05:08 PM on 09/20/2011

Raising taxes on the wealthy to be on equitable footing with the tax rate the working class pays is the point, the headline makes it sound like the wealthiest would somehow be affected by having to pay a similar tax rate as the working class.

That's just not true, they will still be so wealthy someone in the working class would have a tough time even wrapping their mind around the amount of wealth they will still have.

That the country is having a revenue problem and with no jobs in sight, the middle class cannot once again be leaned upon tax wise to save the day, simply because the middle class is almost gone.

Fraudulent activities in the financial sectors that made more than just a few very wealthy people insanely wealthy should be investigated no doubt, if any thing should come of it then I will be surprised.

It is the selective application of the law that is responsible for the situation this country finds itself in, but truly there is no honor among thieves, and in the respect that applies to their treatment of each other at its' heart applies to how its' victims are treated.foremost.

A wealth gap is one thing that will not necessarily destroy a country, corruptions, collusion, cronyism, and two sets of law will.

[flaek3]

05:27 PM on 09/20/2011

The rich pay more than the poor. and over 1/2 of the country do not pay their fair share. They pay zero - nothing fair about getting money from someone (by force of law) without having to do anything for it - but keeping the larger government republicans in office.

[Neets101]

07:58 PM on 09/20/2011

The disabled, seniors on social security, and the working poor collect just enough income to not starve hopefully, and you want to tax them on that, rather than have the wealthiest pay the SAME tax rate as working folks do.
------------------------------------------

http://www.forbes.com/sites/robertlenzner/2011/07/25/the-400-richest-americans-pay-an-18-tax-rate/

The 400 Richest Americans Pay An 18% Tax Rate

[Patriot86]

08:08 AM on 09/21/2011

That is GOP shite talk...and not really true...consider that the wealty control ...the wealth in this country ...they pay far less then they should.

[beckjr2000]

05:49 PM on 09/20/2011

You confuse the amount of taxes paid to their total income with the Tax Rate! The wealthy pay a higher rate of tax now. As a matter of Fact the Top 1% of Income Tax Filers paid more in the total amount of taxes the Government collected than the Bottom 90%! I'm still waiting for someone to explain to us all just what exactly is their "Fair Share"?

[Neets101]

07:52 PM on 09/20/2011

"The 400 Richest Americans Pay An 18% Tax Rate"

http://www.forbes.com/sites/robertlenzner/2011/07/25/the-400-richest-americans-pay-an-18-tax-rate/

[AmySeow]

02:52 PM on 09/20/2011

Taxes by themselves don't work. What you really need to do is eliminate all the tax write offs that people exploit.
One fair flat tax for all will solve many of our problems.

http://www.wix.com/andrewcostell3/simple-wealth-book

[tacevad]

02:58 PM on 09/20/2011

and create far too many paupers in the process

[Pushing70]

03:18 PM on 09/20/2011

All the social programs need to become budget items and taken out of FIT as credits that politican manipulate in the dead of night.

[Patriot86]

08:09 AM on 09/21/2011

A flat tax is regressive and unfairl. and it will never happen. The powers that be would merely raise taxes on the middle class and poor- fees as they do in low tax states already and of course the states would do the same.

[cadawa]

02:21 PM on 09/20/2011

"Debate"? Can't these people add and subtract? Don't they have even a modest grasp of economicd and the role of government?
Denial, more likely.
The function of captitalism is to concentrates capital. When the imbalance becomes serious, it endangers the economy and the health of the nation. Government has a role to play in redistributing this wealth and returning it to the economy. It also has a role to play in regulating industries that manipulate the marketplace and collude to harm consumers and to encourage workers to organize to they can share in the wealth they create.
The most successful form of capitalism is a social democracy where governments are robust in carrying out these functons.

[flaek3]

05:30 PM on 09/20/2011

We must not mix up capitalism with free market. the free market gives freedom to all who participate. It elevates thousands - the opposite of a free market is social democracy.

[cadawa]

03:46 PM on 09/21/2011

One of the functions of capitalism is the concentration of capital. We are now experiencing an extreme example of that function where 95% of everything is controlled by a small percentage of the top tier.
Social democracy is not the opposite of capitalsim but a corrective measure by the state to address imbalances.
The 'free market' is a elite religious belief in the intelligence of markets to regulate themselves. There is no evidence to support this belief and a quite a lot of evidence to disprove it utterly.

[CitizenPane]

01:42 PM on 09/20/2011

Maybe the current tax system just does not work. I don't know if a flat tax is the answer but when the wealthy can essentially pay less tax than the middle class guy something is wrong. I am sure there are a lot of hard working wealthy men and women - other than trust fund babies-that truly earned their millions. I get it. But to have opportunities to diminish the wealth at tax time with loopholes and other tax breaks that are not available to other Americans such as:

-Interest on your home if it hasn't been foreclosed on or
-Medical deductions if you have health care or other medical costs that hopefully haven't bankrupted you or
-child care deductions if you are not unemployed and don't need day care because you are home all day jobless.
and others. Life is not fair but I would lean more toward equitable. How about equitable??

[Matt Herren]

02:16 PM on 09/20/2011

A national sales tax should be strongly looked at as well. At this point, there is nothing wrong with at least having the discussion because as you noted, the current system isn't exactly cutting it.

A national sales tax forces everyone to pay based on the level of what they consume as opposed to what they make... if they choose not to spend that money, that is in reality a good thing as that capital will go toward expansion of operations and reinvestment.

It assuredly has it's drawbacks though.... but instead of instantly vilifying any serious proposals to fundamentally reassess what we are doing, honest discussions need to be had... because $14 trillion turns into $20 trillion pretty quickly... and it's only going to get worse from there.

[Trepasky]

03:00 PM on 09/20/2011

A national sales tax takes more from the lower wage earners (as a percentage of income) than from higher wage earners.

It is plan the wealthy would gladly support as it reduces their (percentage of tax versus income) and increases the (percentage of tax versus income) for the other 90% of us.

[abbadabba]

01:37 PM on 09/20/2011

Since the 70s, our wages have only risen 10%. But in that time, wealthy folks have seen a large increase in income and a reduction of taxes. Congress has kept the minimum wage low to benefit business. That's a subsidy. But doing so has also reduced the revenue for entitlements. Congress has given the poorer folks tax credits to balance this disgusting subsidy, but that also reduces revenue for our entitlements. That's why so few poor folks pay taxes. I find the whole scam disgusting. When folks say we dont' pay our fair share, they need to include the fact that neither do our employers.

[abbadabba]

01:30 PM on 09/20/2011

When the wealthy are taxed less than the poor, there will inevitably be a greater disparity, but taxes increase sovereign wealth, the common wealth, not personal wealth. Taxing to balance wealth is silly, but taxing to pay your bills is essential. Or else you end up with a downgrade which injures everyone, especially the wealthy.

[beckjr2000]

05:54 PM on 09/20/2011

Be sure and let us know when the Wealthy pay less Taxes than the Poor! According to the Tax Foundation the Top1% pay more money in taxes than the Bottom 90% of Income Tax Filers combined!

[vinyl1]

12:58 PM on 09/20/2011

It is possible that taxes, and the accompanying welfare state, may actually increase the wealth gap in certain types of countries.

Take a country like the US, where the top 10% receive 45% of the income and pay 67% of the taxes. The taxes they pay help people at working poor, providing food stamps, earned income credit, college scholarships, etc. They also help the underclass, providing welfare payments, SSI, WIC, etc.

But at the same time, these programs sap the motivation for the bottom two-fifths to advance themselves. If you can live OK without the need for studying hard in school or working that much, many people will take the easy way and do it. When there is an economic upheaval, like we have today, they are hung out to dry.

In the meantime, higher taxes on the upper 20% force them to work harder, have fewer children, emphasize education and study, save more, and do everything you have to do to become truly successful in our society. They are toughened up by the same mechanism that weakens those at the bottom.

Of course, there are other types of societies where high taxes do not have this effect. In a small, ethnically homogeneous society with pervasive middle-class values and honest governments, high taxes can be used to make things easier for everyone at various stages of life. But even these societies tend to become gradually corrupt.

[billc516]

01:53 PM on 09/20/2011

Your assertion that the rich pay a disproportionate amount is not true. The top 10%, when including federal, state, and local taxes, pay 48% of the total. That's compared to 45% of the income, hardly the disparity that the rich would have us believe. And let's not forget that the rich have a disproportionate share of income that's not included in these calculations, such as contributions to and growth in pensions and unrealized gains.

Your second assertion is more troubling. We have a poverty rate of 15%, an unemployment/underemployment rate at about that same level, and increases in worker productivity that correspond to increased corporate profits but no increase in the average American's standard of living. You blame this on the largesse of the wealthy, a largesse that is simply not there. A truly progressive tax system that has the wealthy paying more while also rewarding companies that hire Americans would do much to eliminate our economic problems.

[Nobody78]

01:59 PM on 09/20/2011

Taxes were much higher in the 50s and people were more motivated. Yes there will always be small number of people in a society that don't want to work, but what we have now is a lot of unemployed and underemployed people that would love to have a job that would pay enough to the basic needs to survive.

[msbeal]

12:32 PM on 09/20/2011

I believe everything I've been reading lately about some not paying their fair share but I've got to say, I sure would be more in to it if they'd stop wasting 18 billion a month chasing ghosts over in the Middle East.

Maybe one, taxing, will lead to the other, stopping the waste.

[realorpretend]

12:15 PM on 09/20/2011

An education gap is a phenomenal thing, as there are some people who are excelling in brilliant beautiful ways - I can see no difference in the wealth gap.

What would be disgusting is if wealth in the united states was roughly the same amongst most people… meaning everyone is as productive as one another and no on is excelling their brothers and sisters.

[IfIonlyknew]

11:00 AM on 09/20/2011

Why does the MSM keep saying that they are trying to narrow the wealth gap,When it's about them just paying their far share.

[msbeal]

12:37 PM on 09/20/2011

I cannot remember the title of this little book I read many, many years ago. It had a very simple premise, all the ways people use to gain advantage in negotiating money.

All this nonsense about 'class warfare', 'job creators', 'fairness', is just negotiating techniques to gain advantage and nothing more.

We need to collectively blow them off and collect the dam.n taxes.

[eumenides]

01:01 PM on 09/20/2011

Good question. Especially since the very wealthy often set their own compensation. When taxes go up they just pay themselves more. The middle class can't do the same that why the the AMT get" adjusted" every year. Tax hikes trickle down much better than wealth does.

[IndyVoter777]

10:19 AM on 09/20/2011

http://www.cnbc.com/id/44591639

The real story and although there are still issues with taxation in our country it is certainly not what HP says it is.

[nypapajoe]

09:09 AM on 09/20/2011

The fact remains that the current economic demise of the middle class was brought about by the greed and corruption that has dominated our politics! The clear distinction between the Rich and Poor is as a direct result of the "Class Warfare" brought about because the corporate mentality has dominated our economy bringing about unemployment, bankruptcy and foreclosures! This is in fact Class Warfare which throughout history has always for a time dominate the landscape until the people rebel against it's oppression! To deny these facts is rather asinine because the the bumbers don't lie unlike the Republicans who live in a vacume! The propaganda set forth by the Right Wing has been rather successful by recruiting the irrational Baggers to argue their distorted Right Wing Racist lies! Immigrants, the White House nor the "Lazy Public Unemployed" are NOT the culprits here, NO! It's the influence of the Ultra Conservative Right Wing Rich, who want to create a corporate haven that consists of gated White communities, heavily armed where others can't attend! But reallity prevails WE ain't going anywhere! The "Blackman" is President and you will pay your fair share in taxes and yes you will have to pay us fair wages, health care and a great education! So move to Alaska if you can't handle living next to others!