Originally Posted by KaiserD2

I don't. Graduated with almost no deductions.

Today's left often wants it both ways. Many among them apparently want the return of the 70-90% marginal rates of the "economic glory days" but won't support restoring the deductions and tax shelters of that era which resulted in very few folks paying into those brackets.

In other words, they *want* the rich to be paying 70-90% of their income in taxes -- not just encourage them to put their money to beneficial economic use in order to avoid that punitive level of taxation.

Originally Posted by ziggyX65

Today's left often wants it both ways. Many among them apparently want the return of the 70-90% marginal rates of the "economic glory days" but won't support restoring the deductions and tax shelters of that era which resulted in very few folks paying into those brackets.

In other words, they *want* the rich to be paying 70-90% of their income in taxes -- not just encourage them to put their money to beneficial economic use in order to avoid that punitive level of taxation.

I can agree with what you are implying - that folks just want some sort of revenge on the rich and are not thinking this through from truly an economic perspective.

However, the 70-90% rates being bandied about are marginal rates - you would pay a smaller rate on your first one or two million of income. Also, as i noted above, much of the wealth generation of the top 0.1% is never shown on their individual returns as taxable income, it is shown on their financial entities as "expensives" and are deducted from those entities' incomes. For the rich, housing, cars, jets, travel, etc. are business expenses.

Also, the last decade should have disabused you from the notion that the rich are or will "put their money to beneficial economic use."

In the end, taxing the rich right now is not an economic solution, it is only a "feel good non-solution" that distracts from what really is needed. By linking the needed federal spending to tax increases (because, OMG, deficit spending might some day lead to inflation!), it makes it highly difficult to get the needed spending.

Originally Posted by playwrite

However, the 70-90% rates being bandied about are marginal rates - you would pay a smaller rate on your first one or two million of income.

Sure -- but that would mean someone making (say) $10 million might see the vast majority of their income taxed at 70% or more. And even when we had marginal rates that high, there were enough write-offs and shelters that almost no one paid those rates.

Originally Posted by James50

Wow, PB, we may make a free-booting capitalist out of you yet! So you must think that people who are extraordinarily gifted in money management or extraordinarily gifted in running a business should be compensated well. Good for you!


Sorry, but this is simply untrue. The tenured faculty at these institutions do quite well, thank you, some even making it into the 1%. Warren has lived large on the boat floated by student loans and government consulting fees. That these kids may spend the next 20 years paying the loans back? Well, the education is worth it, right?? We got people lined up to pay it, right? Nothing to see here. Move along.

She represents a special interest which will do nothing to interrupt the gravy train. You will not hear any calls from her to reduce academic pay, tighten up on student loans, or make non-profit universities taxable entities. Of that you can be sure.

Now the adjunct faculty - that is a different story - but then they are the little people, right?

James50

James, since Harvard's endowment is somewhere around $32 billion, Warren probably isn't (nor any of the tenured faculty there) are making their income off of student loans.

Originally Posted by annla899

James, since Harvard's endowment is somewhere around $32 billion, Warren probably isn't (nor any of the tenured faculty there) are making their income off of student loans.

You may be right, but tuition continues to go up faster than the economy. Student loans are fueling it in part. It can't go on.

Of course, I am sure you realize the endowment is being managed in an evil 1% kind of way too. Private equity, hedge funds, and other financial legerdemain.

James50

Originally Posted by James50

Of course, I am sure you realize the endowment is being managed in an evil 1% kind of way too. Private equity, hedge funds, and other financial legerdemain.

Again, you are conflating "wealthy" with "evil" here. I think we've been over this many times on this board -- wealth in and of itself isn't the enemy. Wealth attempting to buy influence so they can grab more wealth at the expense of the less fortunate *is*.

Originally Posted by ziggyX65

Again, you are conflating "wealthy" with "evil" here. I think we've been over this many times on this board -- wealth in and of itself isn't the enemy. Wealth attempting to buy influence so they can grab more wealth at the expense of the less fortunate *is*.

A Harvard professor running for the Senate is pretty much the definition of trying to have influence. Look at the funding for Obama in 2008 and 2012. The biggest givers are the non-profit elite universities. I am confident Elizabeth Warren's fund raising looks similar. It is not a coincidence that the Obama administration is going after the for-profit universities.

These people running the endowments and the professors benefiting are not girl scouts.

James50

Originally Posted by James50

A Harvard professor running for the Senate is pretty much the definition of trying to have influence. Look at the funding for Obama in 2008 and 2012. The biggest givers are the private universities. I am confident Elizabeth Warren's fund raising looks similar. It is not a coincidence that the Obama administration is going after the for-profit universities.

This may or may not all be true, but that's really not the point. You keep making references to OWS and "the 1%" but I don't think many in that space consider all wealthy folks as the enemy. If you want to talk about hypocrisy among some on the left (though the left on this board would disagree that they are "the left"), that's fine. But it seems like you keep trying to define OWS as a movement that thinks the rich are automatically evil and they are all the enemy, and I just don't see that.

Are some on the left hypocrites about wealth? Sure. But that's the appropriate connection for the stuff you quoted here, not so much OWS.

Originally Posted by James50

You may be right, but tuition continues to go up faster than the economy. Student loans are fueling it in part. It can't go on.

Of course, I am sure you realize the endowment is being managed in an evil 1% kind of way too. Private equity, hedge funds, and other financial legerdemain.

James50

No doubt! And I don't disagree with you about the cost of college tuition. I'm not entirely convinced that it is caused only by availability of student loans, however. If that were the complete picture, why didn't tuition spiral up when more federal and state grant money was available?

James, as David and I have tried to point out many times, the Elizabeth Warrens are the rarity in terms of college salaries. Harvard salaries in general are a rarity. I don't know if Warren's professorship is endowed, but there are a number of endowed professorships at Harvard.

Originally Posted by ziggyX65

You keep making references to OWS and "the 1%" but I don't think many in that space consider all wealthy folks as the enemy.

Well since there is no program and no leadership to OWS, I can't contradict you. I guess OWS and the evil portion of the 1% are whatever and whoever you say it is.

Can you make a definition for the evil part of the 1% that does not include Elizabeth Warren? Or is your definition simply a personal one - this person is OK, this person is not - just an ad hoc individual determination?

Perhaps its only the 1% who actually run something and have employees that you think are evil. It can't be simply the effort to have influence over the political process or you have to include Warren and her financial backers.

James50

Originally Posted by James50

Wow, PB, we may make a free-booting capitalist out of you yet! So you must think that people who are extraordinarily gifted in money management or extraordinarily gifted in running a business should be compensated well. Good for you!

We need more capitalists (and hence competition). The people getting the great pay have been getting it either for destroying the competition or treating subordinates badly. The sociopaths have been winning the economic war, and if they win, even they lose in the end. Who wants to live in Mob-dominated Newark?

I hardly deny that stewardship of existing assets is a rare talent. Ten years ago I would have figured that Kodak Corporation would last forever. Then as digital cameras came into being that Kodak would adapt. Now... So much for my skill with a crystal ball.

Sorry, but this is simply untrue. The tenured faculty at these institutions do quite well, thank you, some even making it into the 1%. Warren has lived large on the boat floated by student loans and government consulting fees. That these kids may spend the next 20 years paying the loans back? Well, the education is worth it, right?? We got people lined up to pay it, right? Nothing to see here. Move along.

For some professors, side income (from consulting fees and book royalties) can be bigger than the teaching salary. That does not figure into the cost of education (unless the professor writes his own banal text on calculus or freshman composition and charges $500 for it after making it the mandatory text, which would be corrupt). Grad school? You might expect that because of the narrow market and limited number of suppliers of texts.

She represents a special interest which will do nothing to interrupt the gravy train. You will not hear any calls from her to reduce academic pay, tighten up on student loans, or make non-profit universities taxable entities. Of that you can be sure.

Lots of things would be cheaper if employee compensation were cut. But who would buy the stuff except importers in other countries?

Now the adjunct faculty - that is a different story - but then they are the little people, right?

I figure that many of those are in early-career stages (who really wants to teach freshman college courses in gigantic lecture halls?) or are part-time teachers.

Originally Posted by James50

Can you make a definition for the evil part of the 1% that does not include Elizabeth Warren? Or is your definition simply a personal one - this person is OK, this person is not - just an ad hoc individual determination?

If no one can now, then danger lies ahead. Specifically, from previous 4Tings, the dangers of: the stake, the noose, Madame Guillotine, prison camps, or the gas chambers will determine whom is "evil" and whom "is not".

Or should I say, the needle will? And who knows what the future might hold... perhaps virtual torture that's wired right into your brain?

Laugh now, while you can... Howe has already been quoted that saying at the moment this 4Ting is only at a 2 or a 3... and if this lack of snow keeps continuing... expect there to be more likelihood of crop failures this spring... and nothing is so dangerous than a starving, down-trodden, poor populace...

Dark times lay ahead... but it's always the darkest before the dawn...

~Chas'88

Originally Posted by pbrower2a

I figure that many of those are in early-career stages (who really wants to teach freshman college courses in gigantic lecture halls?) or are part-time teachers.

Many are middle aged or older and just need a job. There are many people who would like the job of teaching in a university even with no job security and no benefits. Bottom line - adjunct faculty is a way of lowering labor costs. Its a two tier labor system.

Like I said, these non-profit universities are not run by girl scouts.

James50

Originally Posted by Chas'88

If no one can now, then danger lies ahead. Specifically, from previous 4Tings, the dangers of: the stake, the noose, Madame Guillotine, prison camps, or the gas chambers will determine whom is "evil" and whom "is not".

Or should I say, the needle will? And who knows what the future might hold... perhaps virtual torture that's wired right into your brain?

Laugh now, while you can... Howe has already been quoted that saying at the moment this 4Ting is only at a 2 or a 3... and if this lack of snow keeps continuing... expect there to be more likelihood of crop failures this spring... and nothing is so dangerous than a starving, down-trodden, poor populace...

Dark times lay ahead... but it's always the darkest before the dawn...

~Chas'88

Ways to combat this? Well, if people re-learned how to can food... wasn't that something that GIs knew how to do, but they seemed to take with them that "secret" to the grave as their Late Silent & Early Boomer kids thought: "why would I need this skill?" Not judging, just saying wasn't that the "collective thought" behind abandoning canning & pickling? Besides the fact that supermarkets provided everything of course.

~Chas'88

EDIT: The question becomes: Are you a grasshopper or an ant? To recall the old Disney Silly Symphony.

Originally Posted by Chas'88

If no one can now, then danger lies ahead.

Well done Chas. Now we are getting to the heart of the matter. No one can now or will be able to in the future say who the good 1% are and who the bad 1% are in a consistent way. This focus on who in the 1% is evil is no more than a sanctified hunt for the heretics complete with denunciations and show trials.

James50

Originally Posted by James50

Well done Chas. Now we are getting to the heart of the matter. No one can now or will be able to in the future say who the good 1% are and who the bad 1% are in a consistent way. This focus on who in the 1% is evil is no more than a sanctified hunt for the heretics complete with denunciations and show trials.

James50

It's like trying to discern who was potential Japanese spies. It becomes easier to just move and vilify them all.

Note: Please do not misunderstand me, I am not saying that OWS is this way currently. However if it doesn't have better ways of defining who the "baddies" are, then there are some possible future problems dead ahead for it & us. Think of this as a challenge to create better definitions or get to the true root of the problem.

~Chas'88

Originally Posted by James50

You may be right, but tuition continues to go up faster than the economy. Student loans are fueling it in part. It can't go on.

Of course, I am sure you realize the endowment is being managed in an evil 1% kind of way too. Private equity, hedge funds, and other financial legerdemain.

James50

Yes, James, I am very well aware of that, having protested it, along with Bill Strauss and others, for the last 8 years. But the Endowment cannot give money to any candidate. Whether the Endowment managers have is an interesting question that would be worth looking into, but they certainly haven't formed a PAC.

Originally Posted by Chas'88

Ways to combat this? Well, if people re-learned how to can food... wasn't that something that GIs knew how to do, but they seemed to take with them that "secret" to the grave as their Late Silent & Early Boomer kids thought: "why would I need this skill?" Not judging, just saying wasn't that the "collective thought" behind abandoning canning & pickling? Besides the fact that supermarkets provided everything of course.

~Chas'88

EDIT: The question becomes: Are you a grasshopper or an ant? To recall the old Disney Silly Symphony.

My mom knows how to can and she taught me how to.

Originally Posted by ziggyX65

Sure -- but that would mean someone making (say) $10 million might see the vast majority of their income taxed at 70% or more. And even when we had marginal rates that high, there were enough write-offs and shelters that almost no one paid those rates.

That is a myth and a lie. What is true, perhaps, is that it took away most of the incentive to pay huge salaries/bonuses--but people did pay it all the same, including athletes--that's how Joe Louis and Sugar Ray Robinson went broke. They didn't save for the IRS.

Originally Posted by James50

I know I am whining again. Many people would love to be in the situation I am in. I also recognize the income inequality problem. Still, the whole focus on the 1% sets my teeth on edge as we attempt to decide who is in the 1% in a good way and who is in it in a bad way. And I also struggle with the sense that whatever the political system ends up doing will involve coming after people like me and leaving untouched the class of people and systems that are actually the problem.

James50

Noone ever says anything except that "the 1%" is a general notion that 1% of Americans have a disproportionate share of wealth, and therefore power, in this country, because the system is rigged to favor them. The proposed answer is not to "come after" anyone, but to shift the rules back so that the middle class and the poor have a decent chance again. That may mean your taxes go up, if you are in the upper 1% income group, but that will apply to everyone in the top income bracket, not to one group of the 1% and not another. It may mean regulations are put back in place so that financiers cannot gamble with other peoples' money, or that corporations and their lobbyists can't buy elections or political favors, but those rules won't apply to folks not engaged in these activities.

Originally Posted by KaiserD2

That is a myth and a lie.

Thanks for essentially calling me a liar without providing any hard evidence to support it. I appreciate the respect.

How about this one from a left-leaning think tank, showing the total effective income tax rates from 1979 to 2007? See the second chart on this page:

http://www.taxpolicycenter.org/taxfa....cfm?Docid=456

Yes, for "the 1%" the federal effective rate dropped from 21.8% to 19.0%. (I never claimed the rich didn't get a tax cut, just that it isn't nearly as huge as apoplectic lefties want to claim by using "marginal rates" as evidence.) But note that the "effective" rate of 2007 is much closer to the highest bracket in 2007 than it was in 1979. Unless your claim is that much of this 1% didn't have enough *total* income (sheltered or not) to crack the 70% bracket, methinks you protest too much.

These differences in *total* effective rate are very small relative to the differences in tax levels at the highest brackets. Surely you're not suggesting that much of the "1%" didn't have income high enough to trip the top brackets as late as 1980? And how could the top 1% have an effective tax rate of 21.8% in 1979 with a top marginal rate of 70% if not because of a huge number of shelters and write-offs?

Are these more lies and myths?

Meanwhile, Ron Paul is proving that many if not most Social Darwinists are also racists of one sort or another:

http://www.npr.org/blogs/itsallpolit...o-claim-credit

Originally Posted by ziggyX65

Thanks for essentially calling me a liar without providing any hard evidence to support it. I appreciate the respect.

How about this one from a left-leaning think tank, showing the total effective income tax rates from 1979 to 2007? See the second chart on this page:

http://www.taxpolicycenter.org/taxfa....cfm?Docid=456

Yes, for "the 1%" the federal effective rate dropped from 21.8% to 19.0%. (I never claimed the rich didn't get a tax cut, just that it isn't nearly as huge as apoplectic lefties want to claim by using "marginal rates" as evidence.) But note that the "effective" rate of 2007 is much closer to the highest bracket in 2007 than it was in 1979. Unless your claim is that much of this 1% didn't have enough *total* income (sheltered or not) to crack the 70% bracket, methinks you protest too much.

These differences in *total* effective rate are very small relative to the differences in tax levels at the highest brackets. Surely you're not suggesting that much of the "1%" didn't have income high enough to trip the top brackets as late as 1980? And how could the top 1% have an effective tax rate of 21.8% in 1979 with a top marginal rate of 70% if not because of a huge number of shelters and write-offs?

Are these more lies and myths?

H-m-m-m. Here's another view with just the result for 2007:


Note how much the rate drops at the very top.

Originally Posted by Marx & Lennon

H-m-m-m. Here's another view with just the result for 2007:


Note how much the rate drops at the very top.

I was looking only at income taxes. I think this includes regressive payroll taxes in the calculation. Since we were talking about marginal income tax rates, I was looking strictly at income tax brackets. But you are right -- when you include regressive payroll taxes into this (particularly FICA/SS taxes with a "zero marginal rate" above $110K or so), the *total* effective rate drops for the very wealthy. Not just because they have so much income over $110K, but most of it (in many cases) is not *earned* income subject to payroll taxes at all. This is a legitimate problem but separate from the *income* tax debate, IMO -- this one could easily be resolved by simply popping the FICA cap and applying SS and Medicare taxes to passive income. Of course, our politicians of both parties are too bought and paid for by wealthy interests to do this.

Nevertheless it doesn't change my assertion that before the 1981 Reagan tax cuts and before the 1986 Tax Reform Act which flattened federal income tax rates while eliminating most tax shelters, the effective rate for the top 1% was far, *far* below the top marginal rate, suggesting strongly that much of the top 1%'s income was not taxed before the Reagan-era changes to tax policy.

Originally Posted by ziggyX65

I was looking only at income taxes. I think this includes regressive payroll taxes in the calculation. Since we were talking about marginal income tax rates, I was looking strictly at income tax brackets. But you are right -- when you include regressive payroll taxes into this (particularly FICA/SS taxes with a "zero marginal rate" above $110K or so), the *total* effective rate drops for the very wealthy. Not just because they have so much income over $110K, but most of it (in many cases) is not *earned* income subject to payroll taxes at all. This is a legitimate problem but separate from the *income* tax debate, IMO -- this one could easily be resolved by simply popping the FICA cap and applying SS and Medicare taxes to passive income. Of course, our politicians of both parties are too bought and paid for by wealthy interests to do this.

Nevertheless it doesn't change my assertion that before the 1981 Reagan tax cuts and before the 1986 Tax Reform Act which flattened federal income tax rates while eliminating most tax shelters, the effective rate for the top 1% was far, *far* below the top marginal rate, suggesting strongly that much of the top 1%'s income was not taxed before the Reagan-era changes to tax policy.

No, the actual receipts have always been dramatically lower than the rates, because much of the incremental income was never earned as such. If there is a corporate rule that your job is such that helicopter service is a necessity, then that cost is borne by the corporation, and written off as a "legitimate expense". You might have a "place in town" that's there for your "exclusive use", because it allows you to be available. Those work-related perks were commonplace in the high-tax days (and not uncommon now, either).