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Posted by Moderate February 11, 2012 at 2:35 p.m.

What is the Matter with Kansas – No Kansas Liberals - Round 4?

I lied – oops will that get me “disappeared”? I found when I started to write the last part of my puzzle that it would be too long. So I will insert round 4.

The focus of this blog is to summarize many of the blogs that I have wriitten on related topics. To restate the issue I am addressing, despite attempts to reframe it, is that the Democratic Party seems to be enhancing conditions for those with incomes below $50K by reducing the standard of living of those with incomes between $50K and $250K (with real focus only up to $100K) In addition to the regulatory, tax and policy consideration addressed in the previous three installments of this blog we need to remember the following.

  1. Families with incomes below about $50K pay little or no federal income tax – they are not paying for all the goods and services provided by the federal government.
  2. Families with incomes below $22K receive government subsidies that cost the taxpayer (those who pay) somewhere between $22K and $35K per person considered in poverty. That money comes primarily from those with incomes above $50K.
  3. Our progressive tax system is very progressive on those with incomes between $50K and $350K and then goes flat. Of course the really rich might be paying only 15% of their income while, those with incomes around $100K might be paying essentially the same.
  4. Increasingly our government is mandating goods and services be provided by commercial entities avoiding the tax consequence. When those goods and services are means tested as they increasingly are, or when they apply to a service mostly consumed by those with incomes over $50K ( think health care insurance and a mandate for free reproductive services) we once again add to the loss of standard of living for those in the upper half of the middle class (not upper middle but upper half)
  5. Not all or even most of the people making $100K are rich. Many are families with extensive education and experience near the end of their working lives. Finally they reach a point where they have a bit of discretionary income and the government comes along and takes it to give to others.
  6. We sometimes forget to think about discretionary income (money left when all the basic and necessary bills are paid). Wien you make a million dollars a year the added costs of paying for a regulatory requirement to reduce carbon hardly dents the budget. If you make $100K those costs can be quite noticeable. If we do not shift those costs the impact on those with incomes below $50 K will be devastating.

Now I think I am ready for the last installment.

Comments

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  1. tange (anonymous) says…

    First.

    So, this is the installment in which you actually create the Internet,
    by connecting all the dots?

    / I'm giddy

  2. Moderate (anonymous) says…

    Sorry, Mr. Gore did that. As it says above I cheated and stuck in another set of thoughts before that version.

  3. tange (anonymous) says…

    / I've been misled

  4. Moderate (anonymous) says…

    Sorry

    1. tange (anonymous) replies…

      G i l l l l l l l l y . . .

      1. rockchalker52 (anonymous) replies…

        :-O]

  5. hear_me (anonymous) says…

    Moderate, I liked your earlier thought that we step back in time before the tax breaks and loopholes. Now, there are so many variables being discussed and manipulated all at once, that there is no ways to determine what would work and what would not.This is true of your post.

    From my perspective, I had been a productive member of the community making what I heard was middle income, I continued to work hard over the years, but my income did not significantly increase. Now, I may not be considered middle class any more. So many variables. So many perspectives. Should we try to add another layer of fixes, start over, or step back in time? Who can afford to pay more taxes? It's time for people to step forward and state what they can do. I can afford to pay a little more. So can others. It should not be class warfare. What is more important is setting priorities so that the tax money is spent according to our collective expectations.

    1. Moderate (anonymous) replies…

      The only comment I have is that we also need to set some limit on how much government can take. There is no end to legitimate good things we can do. If we acted as adults we would prioritize those and set about a long term plan to address them. In that plan would be boundaries on resource transfers (means testing is a transfer)

      The typical liberal response is that anyone who preaches such heresy is insensitive to the “poor”. Just watch Greece and consider who really is insensitive to the poor as the ever increasing government dependency comes to a vicious end when nobody they can tax will pay for what they want. Priorities!!

      1. hear_me (anonymous) replies…

        Collective expectations => priorities.

  6. hear_me (anonymous) says…

    Moderate, I liked your earlier thought that we step back in time before the tax breaks and loopholes. Now, there are so many variables being discussed and manipulated all at once, that there is no ways to determine what would work and what would not.This is true of your post.

    From my perspective, I had been a productive member of the community making what I heard was middle income, I continued to work hard over the years, but my income did not significantly increase. Now, I may not be considered middle class any more. So many variables. So many perspectives. Should we try to add another layer of fixes, start over, or step back in time? Who can afford to pay more taxes? It's time for people to step forward and state what they can do. I can afford to pay a little more. So can others. It should not be class warfare. What is more important is setting priorities so that the tax money is spent according to our collective expectations.

  7. tange (anonymous) says…

    More than just numbers and operators, a properly constructed wealth or worth formula needs some warm, fuzzy, squiggly, glimmering, and shimmering things.

    / did I mention generative?

  8. hear_me (anonymous) says…

    Tange, Nothing warm and fuzzy intended. It is not possible to manipulate all the economic variables and control the outcome.

    1. tange (anonymous) replies…

      Sorry, maybe my comment should have read:

      George,
      More than just numbers and operators....

      Regarding your reply immediately above, yeah, I get that.

      ,;-)

      1. hear_me (anonymous) replies…

        Yes, we are humans after all.

  9. Cappy (anonymous) says…

    We have had thirty-some years of class warfare inflicted on the 99% by the 1%. Wage suppression, pension raiding, benefit whittling, attacks on the minimum wage. Worker productivity has tripled in that time, yet wages for most of us are flat or less. Upper incomes have skyrocketed at our expense. For all those who complain about people at the bottom not paying any income taxes, here's a suggestion: Raise their incomes!

    1. hear_me (anonymous) replies…

      The trenches are getting deeper. It's time to stop the warfare. Give everyone a way out of their corners. Let's seer what we can accomplish. I read a Japanese philosopher who wrote about giving face rather than saving face. Same philosophy. If you back someone into a corner, they will come out fighting. Nobody wins.

      1. Cappy (anonymous) replies…

        But if we really want to grow the economy we need to raise the ranks of the middle class. The talk of the rich being "job creators" is nonsense. What creates jobs is middle class demand.

        1. hear_me (anonymous) replies…

          I agree, but still think we need to get past the resentment. We can learn from history, then move forward.

  10. Alceste (anonymous) says…

    "A thinner middle class, in itself, means fewer stepping stones available to people born into low-income families. If the economic and cultural trends under way continue unabated, class mobility will likely decrease in the future, and class divides may eventually grow beyond our ability to bridge them."

    "As a society, we should be far more concerned about whether most Americans are getting ahead than about the size of the gains at the top. Yet extreme income inequality causes a cultural separation that is unhealthy on its face and corrosive over time. And the most-powerful economic forces of our times will likely continue to concentrate wealth at the top of society and to put more pressure on the middle. It is hard to imagine an adequate answer to the problems we face that doesn’t involve greater redistribution of wealth."

    "Over time, the United States has expected less and less of its elite, even as society has oriented itself in a way that is most likely to maximize their income. The top income-tax rate was 91 percent in 1960, 70 percent in 1980, 50 percent in 1986, and 39.6 percent in 2000, and is now 35 percent. Income from investments is taxed at a rate of 15 percent. The estate tax has been gutted.

    "High earners should pay considerably more in taxes than they do now. Top tax rates of even 50 percent for incomes in the seven-figure range would still be considerably lower than their level throughout the boom years of the post-war era, and should not be out of the question—nor should an estate-tax rate of similar size, for large estates." Etc.

    Reference: http://tinyurl.com/3brhm9k

  11. Moderate (anonymous) says…

    Amen

    Some twenty years ago the wife helped rewrite the POS for a portion of Virginia. They saw it coming and at least there was some attempt to try to prepare for all of this.

    I would argue that the advantage to the truly rich has accelerated because the gains for the middle have been so little. I posted how various government policies are impacting gains for the middle. It is not all business – it is all the elites (of all kinds)

    I have also posted that choosing to compete American workers with low cost foreign labor has hurt middle class Americans and small businesses. Large businesses and rich Americans (to include members of Congress) have gained disproportionately from a result that supports large businesses moving off shore and making a lot of money they do not even repatriate.

Reply 20 comments from Moderate Alceste Hear_me Cappy Tange and 1 others

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