Skip to comments.To Reduce Inequality, Tax Wealth, Not Income
Posted on 11/19/2012 6:03:29 AM PST by reaganaut1
WHETHER youre in the 99 percent, the 47 percent or the 1 percent, inequality in America may threaten your future. Often decried for moral or social reasons, inequality imperils the economy, too; the International Monetary Fund recently warned that high income inequality could damage a countrys long-term growth. But the real menace for our long-term prosperity is not income inequality its wealth inequality, which distorts access to economic opportunities.
Wealth inequality has worsened for two decades and is now at an extreme level. Replacing the income, estate and gift taxes with a progressive wealth tax would do much more to reduce it than any other tax plan being considered in Washington.
When economists try to measure inequality, they typically focus on income, because the data are most readily accessible. But income is not always a good gauge of economic power. Consider a group of people who all have high incomes but differ widely in their wealth. Whos going to get into the country club? Whos going to have the money to finance a new venture? Moreover, income data may not reveal the true economic power of people who are retired, or who receive their pay in securities like stocks and options or use complex strategies to avoid taxes.
Trends in the distribution of wealth can look very different from trends in incomes, because wealth is a measure of accumulated assets, not a flow over time. High earners add much more to their wealth every year than low earners. Over time, wealth inequality rises even as income inequality stays the same, and wealth inequality eventually becomes much more severe.
This is exactly what happened in the United States. A common statistical measure of inequality is the Gini coefficient, a number between 0 and 100 that rises with greater disparities.
(Excerpt) Read more at nytimes.com ...
The Slimes has really jacked up the liberal, progressive redistribution fight since the election.
Actually that might not be a bad idea. It would shut up The Gates and Warren Buffet and George Soros for while...either that or drive them out of the country. The reason why all these billionaires claim to be for higher income taxes is because none of them pay any income tax. They pay Capital Gains. The higher the income tax is on high earners the more exclusive their little club becomes and the harder it is for anyone else anywhere to attain their level of wealth.
Tax CRIME! (not income)
What's so great about reducing 'inequality'?
Seriously ... this is pure marxist class warfare ... steal from the rich and give to the
poor party members. "Inequality" in outcome is the right and necessary result of inequality in effort.
The whole premise of the article is Marxist, as several have already noted.
Perhaps a smart plan would be for government to require a pre-payment of the value of the foregone capgains and estate taxes to be remitted prior to establishing the tax exempt foundation. At least we'd be able to make honest men of those vocal tax advocates.
Wow, good catch...
What is the virtue or reducing inequality or equalizing outcomes. Inherently, with such a goal, you’ll reward bad decisions and slothful behavior while punishing good decisions and diligent behavior.
There’s no way around that.
We need to stop taxing production as well.
I wonder if any other nation taxes inventory on the factory floor the way we do?
Tax consumption, not income or property.
any sentient being that takes ten minutes to think this one through, will simply laugh. Just how would the government liquidate the “wealth”, so they can redistribute it? Or would the government just make in-kind transfers? Either way, the transactions costs would eat up all of the hoped for revenue, and the assets would no longer be productive. The Left assumes that incentives mean nothing, when they mean everything.
As an example, I hadn't know until now that the NFL is explicitly exempt for corp taxes under 501(c) sub-paragraph 6.
If you really want to make a dent in the national debt, withdraw the tax-exempt status of 501(c) organizations. Of course, the politician who tries that should ensure his life insurance is fully paid up.
When dealing with the leftists in Big Media, I find that one should always look for the hidden assumptions and covert premises. They’re not content to control the “what, where, when, and how” of the national conversation but must control the “why” as well.
So, is this not a method of taxing our IRAs and other pension funds? Those of who think it would be nice to hit the Buffets and other Lib-Dems, need to realize that this could easily be extended to home values as well!
As long as they start with Bruce Springsteen and Jay-Z, I’m good with it.
Oh, yeah, the Proverbs state “don’t answer a fool in his folly”, but to question the premises.
I’m fully aware of that and still started “wrestling with the pig” with arguing what kind of tax would be better.
Not that the Constitution matters to these people, but the 16th Amendment only specifically authorizes an income tax. Wealth taxes would have to be apportioned by states. Also taxing capital is one of the worst ideas ever.
To decrease inequality, tax the political ruling class elite for the benefits that they voted for themselves. Cost of living pay raises. Golden pension plans and health insurance plans.
From “You did not build it!” to “You do not own it!”
Good points. We should not concede that the goal is to remove inequality. The goal is to improve everyone’s standard of living
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