While
bitter reactionaries in Congress make disingenuous speeches about "robo-
squirrels", here at
Persona Non Grata US Person chooses to emphasize the skewed relationship between wealth accumulation and tax support of the system that allows the rich to become filthy rich:
 |
| [source: G.W. Domhoff, UCSC] |
What can be ascertained from the above pies is that the United States has the most unequal wealth distribution in the developed world, except for Russia and Ukraine according to
Credit Suisse Research. The United States has 47% of the world's ultra-high net worth individuals (defined as more than $50million of net assets). The left-hand pie reflects this concentration of wealth: 35% of net worth is owned by the 1%. The ultra-rich have their money invested in financial assets such as stocks, bonds, derivatives and insurance. Nearly half their income comes from capital gains and dividends, on most of which they only pay 15% capital gains tax. The corporate mass media, owned by the ultra-rich, insists all Americans must cheer for the Dow-Jones because we are all in the market together. The truth is the rest of us (the bottom 80%) own only 5% of financial wealth. The so-called "democratization of stock ownership" is a myth perpetrated by those able to take advantage of an almost
magical source of income.
Turning our attention to payment of taxes: the other major myth perpetrated by apologists for the plutocracy is that low taxes on the rich are necessary to produce jobs for the rest of us. Most of the top ultra-rich (0.1%) are
NOT entrepreneurs! Only 3.6% of those taxpayers were classed as such based on 2004 tax returns. The
Tax Justice Network estimates that between $21 and $32 trillion is stashed in offshore tax havens, or about $10 to $16 trillion uninvested by US citizens in businesses with jobs in this country. Not only rich individuals are paying lower taxes. Corporations are paying less taxes too. Paying federal taxes at an average 22.5% from 1987 to 2008, corporations now pay at an annual rate of 10% which represents a annual loss of tax revenue of $250 billion. The Chicago Mercantile Exchange reported a 2011 trading volume of $1
quadrillion on 3.4 billion annual contracts with absolutely no sales tax, state or federal, applied to the transactions. American taxpayers paid $4 trillion to bail out Wall Street banks! A tax of
one-tenth of a penny on those transactions would pay off the federal deficit.
Most middle-class Americans' source of wealth is their family home as seen in the Federal Reserve chart above. That is why the Financial Panic of 2008 and subsequent Second Great Contraction hit them the hardest. Figures are still preliminary, but according to economist Edward Wolff there has been a major 36.1% drop in wealth of the median household since the peak of the real estate bubble in 2007. The wealth of the über-riche top 1% decreased just 11.1%. Yet seventy-five percent of Americans are burdened with over $11 trillion in consumer debt. So spare
US the talk about waste in social programs until the Pentagon, the biggest waster of all goes on a food-stamp diet (average recipient cost: $4.30/day, or enough to buy one
angry burger), and some semblance of fairness is restored to collecting federal tax revenue.
