Observations on life

Ending Special Tax Treatment for the Very Wealthy

Read the following closely. Is it only me who sees a gap in the logic of all this?

How do the wealthy influence? More specifically who do they influence? Oh I have it, they influence the people we elect and re-elect and re-elect to represent us and act in the best interest of their constituents and the Country.

Here we have people who believe that making the wealthy unwealthy, by more taxes on their incomes and accumulated assets will improve the ethics and moral code of our elected representatives. How does that work?

Not only are top tax rates on ordinary income low by historical standards, the uber-wealthy also stockpile increasing amounts of capital income while paying little or no tax on those accretions of wealth. The resulting negative feedback loop—whereby the rich use their wealth to influence the U.S. political system to skew policy in their favor, including giving themselves even more tax cuts—undermines democracy. In many cases, this allows economic elites to get what they want, even if a majority of citizens disagree. The TCJA is a prime example of this problem. The bill passed into law despite overwhelming public opposition to tax cuts for the wealthy, and some lawmakers admitted that the motivation behind the bill was to satisfy political donors.

Source: Ending Special Tax Treatment for the Very Wealthy – Center for American Progress

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7 replies »

  1. We are a capitalistic democracy and politicians righty should be influenced by lobbyists representing interests of holders of the capital that greases the wheels of our economy, as well as (largely via polls?) the interests of all citizens. However, the country has to have enough funds to cover its obligations, particularly for defense, infrastructure, and basic welfare services.
    A partial answer to the inequality of influence, and a small but significant step toward addressing the inadequate federal revenue as well as the disproportionate influence of a small percentage of wealthy citizens, is to change the concentration of wealth by reinstitution of inheritance tax policies so wealth isn’t overly concentrated into families by perpetually passing on huge amounts of wealth to descendants who have done nothing to earn it.
    Remember the failed success of the so called “Paris Hilton” tax proposal? People who work and legally earn their wealth should be allowed to keep most of it. But should their descendants who contributed nothing to earn the wealth be allowed to keep nearly all of it and consequently be given a greater influence on politicians than citizens with far more modest income? I think not.

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    • Larry I agree with very little of what you said – but, Why the hell are we spending 720 Billion Dollars on National Defense. When I retired from the USAF in 1995 the DoD budget was 480 Billion Dollars adjusted for inflation in 2018 Dollars. We are spending way to much on Defense. Many have it all wrong, it is not rich individuals that are influencing government overspending, it is RICH CORPORATIONS and SPECIAL INTEREST GROUP ORGANIZATIONS.. You want to increase tax revenues to the federal government, get rid of tax exempt status for Churches and other exempt organizations and require all of them to pay 10%.Then you do not have to worry about taxing inheritance at all.
      .

      Liked by 1 person

  2. The American oligarchy is very happy to learn that you don’t understand how they have rigged the economy and the government.

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  3. The problem with this logic is that big donors do not single handedly buy elections. It is the millions of people who donate either individually or through a union to PACs and that is where the big money comes from.

    I also hate how somebody else’s money is going to solve their problems. The wealthy top 20% are estimated to pay (for 2019) 69% of all federal incomes with 25% coming from the top 1%, while the bottom 40% pay less than 4% of the federal tax bill. The bottom 20% are the ones who get the most direct and indirect aid from the federal government through one program or another now.

    The solution is less spending, not more taxes. The bottom 80% want to keep their hard earned money, why aren’t the top 20% allow to keep their hard earned money?

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    • I was in the bottom 20% until I started my Social Security benefits at age 62. With $20,000 in income in Montana, my wife and did not qualify for any government assistance programs. NONE!
      The problem with the tax the rich song and dance, is they tend to define the rich as anyone making more than they are making, so the new tax will not include them. But it will include many small business owners who are already paying their fair share in total taxes.

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