[Action-America]

YES!  VINDICATION!

Finally, although they missed the most important point, a major news source skirts the issue.

(I feel vindicated.  This is an issue that I have written about on numerous occasions, since 1996.  Finally, the major media is getting colse to the truth.  See the permanent , annually updated article, Tick-Tick-Tick - The Economy Bomb, that covers this issue in detail.  I will update that article with the just released numbers from the IRS, within a few days.  Also, the article, 1986-2000 IRS Collections Data by Income Group, will be updated to include the 2001 data and links to that newly released IRS data)

One of the primary reason that the incomes of the rich fell in 2001, is the fact that many of our wealthiest taxpayers left the United States in 2001 and took all of their wealth with them.  According to pre-Patriot Act, pre-9/11 estimates from the then, INS, almost 300,000 people would leave the United States in 2001.  How many of those do you think were poor?  Think about it...

In fact, although only a handful of that almost 300,000 expatriates actually bothered to officially renounce their US citizenship, there is much very good reason to conclude that almost all of them were in the upper strata of income earners, with it being weighted heavily toward the very wealthiest 1% of income earners.

Then consider two other facts.  1) Those estimates were made prior to the implementation of the USA (Un)Patriot Act, which was, without a doubt, the greatest assault on privacy and the 4th Amendment in the history of the United States.  2) Many high level business transactions rely upon privacy until they are actually completed and announced.  That combination creates a huge incentive for the wealthy, who have been under attack by both parties for years, to finally make the decision to move to a more wealth friendly country, with a more secure business environment.  The result is that those pre-(Un)Patriot Act estimates are probably far below the actual numbers.

People like Bruce Bartlett are so concerned with looking for economic reasons for such events that they never look for other outside factors, such as emigration of our wealthiest citizens.  They spend all of their time studying the stock markets, the Fed and IRS regulations and trying to relate them to what they see happening, that they often fail to observe the outside social factors that actually may be having a more significant effect on the economy than anything else.  Normally, that would be a safe conclusion, since social factors usually only have a minor effect on the economy.  However, since the people that we are talking about are the same people who pay almost all of our taxes and fund most of our companies, a very small shift in that group can have a devastating effect on our economy.

The problem isn't the tax rate or a dip in the stock markets.  It is the intrusiveness of and the unbridled threat represented by the IRS that is the problem.  The wealthy are leaving, because they are sick and tired of having the IRS scrutinize every transaction, to see if they can squeeze an extra dollar out of it.  But, now that they are having to meet the heavy and time-consuming (Un)Patriot Act compliance requirements, many wealthy people are finding that their ability to do business in a world where the difference in success or failure may rest in your ability to complete a deal in hours, is being threatened by such time-consuming requirements.  Now, they are being forced to seek relief in other countries.

Sure, the wealthy in the US are making less money.  That's because so many of the wealthy are leaving and people with lower incomes are suddenly included in that upper bracket.  The result is that, as the above article shows, the people in the next lower income bracket are going to have start shouldering more of the tax load.  But, that won't happen for long, because as more of the wealthy leave, that extra tax load will have to be distributed downward.  If you haven't felt it yet, you soon will.

It's time to abolish the Income Tax and IRS, repeal the (Un)Patriot Act and HSA and implement a non-intrusive National Retail Sales Tax, that will draw wealth back into this country, before it's too late.

 

[MHGinTN]

Vindication? ... Hah! I can't wait to hear how the lieberal societal engineering goons will spin this truth. Probably respond with a strawman or redherring, rather than address the hard facts.

[Action-America]

MAJOR BUMP!

Got to go now.  You guys keep it going.

[Elliott Jackalope]

I used to be one of those top 1% taxpayers. This year my income will be well below 15k. I have no interest in earning any more than that. Why? Because it will all be taken in taxes. I've had it. I'm tired of killing myself working myself to death to earn "good money", just to have most of it taken by the government. Find some other sucker to pay the big taxes, from here on I'm going out of my way to earn so little that if anything I'll get free money from the government.

I've learned my lesson. It just doesn't work to try to "get ahead" in America any longer. The minute you make enough to afford the finer things in life, boom, there is the taxman to shaft you out of most of what you've earned. I've learned to enjoy cheap beer and spaghetti for dinner. It tastes a lot better when you realize that you are no longer carrying the weight of a million freeloaders on your back!

[lodwick]

bttt

[EGPWS]

The top 1 percent reported $1.09 trillion of income, down from $1.34 trillion in 2000, according to data posted by the Internal Revenue Service on the Internet on Friday without announcement.

Perhaps it's time for the "biggest contributers"(middle class like me) to realize that it isn't Governments determination or control that drives the largest economy in the world.

The Government is the entity that generate's that "sucking" sound NOT oversea's countries.

Perhaps a drastic cut in Government spending would create more job's here instead of them going overseas.

[helper]

I've only taken a quick look, but it appears to me that the States in the most financial trouble now have income tax rate tables that focus on the upper income workers.

[PatrioticAmerican]

Funny thing. I am considered "rich" and my last year's income was down 20%. Same this year. It will be at last year's level. Although, next year is looking great for a 100+% increase.

[PatrioticAmerican]

P.S. I used to employ 65 people. I now employ no one. Life is better that way; more quality time.

[MissAmericanPie]

Is it still true that those that make over 200,000 pay 95% of taxes? I know several of my wealthier friends have left the country for places like Las Hadas Mexico to live, and another to Europe. I can believe that their absence and moving their companies off shore would influence in a big way the amount of taxes taken in every year.

One friend was griping to me that the IRS calls him and has his bank on the other line and the money he owes is transfered right then and there to the IRS. He really hated those calls, he hated not being able to move money without having to tell the bank and the IRS what he was going to do with the money, they even had the nerve to start making suggestions like, do you really think you need to redecorate your home at this time?

I made the comment on FR that unless we start caring about what is happening to the other guy, the rich especially, that we are going to pay a price.

[Action-America]

BUMP!

Bump your tax lists, folks!

[staytrue]

I think most of the 300k who left are probably retired people who can live very well somewhere else on their savings. I doubt that they are wealthy, maybe 10,000 were wealthy. I do know many people moving to florida and nevada to live off their savings as there is no state income tax. I'm sure you are right about some of the 300k who moved, but I think most are upper middle class, and not the wealthy.

[mo]

We are 300 million people. The world is over 6 billion-we are less than 5% of the world. the way our government and corporations track our finances and identities has created a vast data base for the 95% of the world to potentially exploit at our risk. IMHO we can do business and pay taxes more efficiently and safely in anonymity rather than as we do now, branded and certified "USDA Grade A no1" .

[Green Knight]

Every time I hear of this issue, I keep thinking back to a story I heard about Russia a while back. How a couple years ago, with an incredibly onerous tax code, the Russian treasury was almost depleted. So they instituted a 13% Flat Tax. And surprisingly enough, the money began pouring in (Forgot specifics, though. Anyone remember the story, and got a link with info on this?).

What people like Arianna Huffington don't understand (And which Arnold Schwarzenegger does, since he pointed it out in the California debate), is that if you start taxing people to high, they don't just sit there and take it. They LEAVE. They go somewhere else where the taxes aren't so onerous. People complain all the time about how all these corporations having tax shelters in Haiti or wherever, yet NO ONE bothers to ask why these companies felt the need to set up their corporate headquarters outside of the US borders.

Well, there's my personal rant. Whatever the case, I completely with you about the National Retail Sales Tax. I'd love to bury the IRS for good, and get rid of the Income Tax, altogether.

[cake_crumb]

"One of the primary reason that the incomes of the rich fell in 2001, is the fact that many of our wealthiest taxpayers left the United States in 2001 and took all of their wealth with them"

The bursting of the tech bubble, the catastrophic attacks, then the anthrax scare and nobody knowing when or where the next attack would come had nothing to do with the loss of incomes for the rich?

[mrsmith]

.

"a drop in income from capital gains"
More than a 250 billion dollar drop, almost 45%!
Individual Income Tax Returns, Preliminary Data, 2001 (PDF)

Wow, that sure took a lot of money out of the top bracket...

[ATOMIC_PUNK]

Bumpier than a stone masons head !

[tortoise]

One of the primary reason that the incomes of the rich fell in 2001, is the fact that many of our wealthiest taxpayers left the United States in 2001 and took all of their wealth with them.

That's a load of nonsense for the most part, and illustrates that you have no clue what the more well-off people do with their money. Most of them, like me, have a highly variable income that we can control to suit the economic climate. Up until three years ago, I was definitely filing in the top 1% for several years because I had a lot of profit to bleed. When the economy went south, I sealed the hatches and focused on long-term business investments rather than letting the government rape me for my seed corn during this dry spell.

As a consequence, I have averaged $10k gross income for the last three years, which is just enough to cover my basic living expenses. All of my other resources have been dumped into startups and business ventures, all of which are starting to take off and gain value (something I'll pay for eventually).

So don't you worry about where my money is going. It's been paying the salary of class warfare idiots like yourself at companies I built, all without taking a dime of profit for the last few years while the economy has been tough because it would be taking money away from businesses that need it. I don't need closet communists masquerading as "conservatives" cheering every time Uncle Sam rapes me, because next time around I may decide not to play. Rather than putting my money in job producing investments I'll just live large through the bad economy so that you can see me write a fat check to the IRS. Just don't whine when you don't have a job.

[Nebullis]

The biggest increase, however, was among those making $56,000 to $92,800, whose share of all income taxes increased to 18 percent from 16.7 percent. They accounted for a larger share of income taxes than the very wealthiest, the top tenth of 1 percent of Americans who paid 16 percent of the government's total income taxes.

An astoundingly meaningless bit of fact, yet, reported by David Cay Johnston and the New York Times to fuel resentment.

[SSN558]

One of the primary reason that the incomes of the rich fell in 2001, is the fact that many of our wealthiest taxpayers left the United States in 2001 and took all of their wealth with them.

Many of the wealthiest taxpayers in America are or were foreign investors. Putting your money in America was viewed as a safe stable place to stash your wealth away from the greedy fingers of foreign politicians and countries that did not have a 4th ammendment. That situtation does not exist anymore due to the patriot act. For all the FICA taxes we pay, your money is no more safe in the bank than if you burried it in the yard in a cookie jar. The interest rates of a cookie jar (0%) are competitive with those set by the federal reserve.

Even Bill Clinton has established a residence in a foreign country (Ireland) to sheild his wealth.

[jmstein7]

ping!