Archive for category Poverty
Worst. King. Ever. “Game of Thrones” Joffrey Baratheon. “You can’t talk to me like that. The king can do as he likes!”
HBO’s “Game of Thrones” is the best show on TV. Unfortunately, powerful people behaving badly isn’t only the stuff of fiction.
Out of 141 countries, the U.S. has the 4th-highest degree of wealth inequality in the world, trailing only Russia, Ukraine, and Lebanon.
In 1983 the poorest 47% of America had $15,000 per family, 2.5 percent of the nation’s wealth.
In 2009 the poorest 47% of America owned ZERO PERCENT of the nation’s wealth (their debt exceeded their assets).
Inequality is stifling our economy, because the customers business depends on are broke. The Consumer Confidence Index dropped 8 points this month, as Washington politicians imposed austerity and higher taxes on what’s left of the middle class. There are still 12 million Americans who need jobs. Most Americans have experienced unemployment at some level in the past five years. Yale Economist Robert Shiller warns that the massive losses suffered in the housing market won’t be made good anytime soon.
We need jobs and a stable economy. All we’re getting from Washington is budget cuts and more talk of dismantling Social Security, Medicare, and Medicaid. The “Affordable Care Act” is going to make health insurance less affordable.
Wealth Inequality in America
Infographics on the distribution of wealth in America, highlighting both the inequality and the difference between our perception of inequality and the actual numbers. The reality is often not what we think it is.
It’s the Inequality, Stupid
Wealth Inequality in America
How Unequal We Are: The Top 5 Facts You Should Know About The Wealthiest One Percent Of Americans
CEO pay is 380 times average worker’s
Source: Washington Post
President Obama’s proposed $9.00 minimum wage (by the end of 2015) would still not be a living wage, and would even leave families below the poverty line.
In other words, raising the current minimum of $7.25 an hour by so little does almost nothing to address the problem of rising income inequality in America. If you adjust for inflation (see graph), you see that the minimum was around $10 an hour in current dollars in the late 1960s. Dean Baker:
It is important to realize that this was not always the case. The federal minimum wage was first put in place in 1938. From that year until 1968 when its value peaked, the purchasing power of the minimum wage increased by more than 140 percent. As a result, minimum wage workers saw a sharp increase in their living standards. Over this 30 year period, low wage workers shared in the gains of the economy as a whole as the minimum wage rose in step with productivity growth.
If workers at the bottom had continued to share in the economy’s growth in the years since 1968 as they had in the three decades before 1968, we would be looking at a very different economy and society. If the minimum wage had risen in step with productivity growth it would be over $16.50 an hour today.That is higher than the hourly wages earned by 40 percent of men and half of women.
It’s important to remember that as long as the minimum wage is not a living wage, taxpayers make up some of the difference in terms of social safety net programs like SNAP (food stamps), and low-income rent subsidies. This is, in effect, a gift to employers who pay poverty wages.
The Minimum Wage: Myths & Facts
The latest Census Bureau data shows that one in two Americans currently falls into either the “low income” category or is living in poverty. Low-income is defined as those earning between 100 and 199 percent of the poverty level. Adjusted for inflation, the earnings for the bottom 20 percent of families have dropped from $16,788 in 1979 to just under $15,000. Earnings for the next 20 percent have been stuck at $37,000.
Source: Us Against Greed
Ten Numbers the Rich would like Fudged
The numbers reveal the deadening effects of inequality in our country, and confirm that tax avoidance, rather than a lack of middle-class initiative, is the cause.
1. Only THREE PERCENT of the very rich are entrepreneurs.
According to both Marketwatch and economist Edward Wolff, over 90 percent of the assets owned by millionaires are held in a combination of low-risk investments (bonds and cash), personal business accounts, the stock market, and real estate. Only 3.6 percent of taxpayers in the top .1% were classified as entrepreneurs based on 2004 tax returns. A 2009 Kauffman Foundation study found that the great majority of entrepreneurs come from middle-class backgrounds, with less than 1 percent of all entrepreneurs coming from very rich or very poor backgrounds.
2. Only FOUR OUT OF 150 countries have more wealth inequality than us.
In a world listing compiled by a reputable research team (which nevertheless prompted double-checking), the U.S. has greater wealth inequality than every measured country in the world except for Namibia, Zimbabwe, Denmark, and Switzerland.
3. An amount equal to ONE-HALF the GDP is held untaxed overseas by rich Americans.
The Tax Justice Network estimated that between $21 and $32 trillion is hidden offshore, untaxed. With Americans making up 40% of the world’s Ultra High Net Worth Individuals, that’s $8 to $12 trillion in U.S. money stashed in far-off hiding places.
Based on a historical stock market return of 6%, up to $750 billion of income is lost to the U.S. every year, resulting in a tax loss of about $260 billion.
4. Corporations stopped paying HALF OF THEIR TAXES after the recession.
After paying an average of 22.5% from 1987 to 2008, corporations have paid an annual rate of 10% since. This represents a sudden $250 billion annual loss in taxes.
U.S. corporations have shown a pattern of tax reluctance for more than 50 years, despite building their businesses with American research and infrastructure. They’ve passed the responsibility on to their workers. For every dollar of workers’ payroll tax paid in the 1950s, corporations paid three dollars. Now it’s 22 cents.
The rich want more tax cuts, they will be very unhappy without them. Where to get the money? Just steal it from the poor, the elderly, widows, orphans, and disabled veterans!
President Obama and Speaker Boehner appear close to striking a deal that includes Social Security benefit cuts, what is known in Beltway-speak as “chained CPI.” For millions of seniors, Social Security pays for crucial medicine, food, and daily necessities. The greatest impact would be on the oldest seniors, which happens to correlate with the poorest. For most of the middle class, Social Security is the last remaining defined-benefit retirement program available.
The average monthly Social Security benefit for a retired worker was about $1,230 at the beginning of 2012. The latest cost of living allowance (COLA) comes to about a dollar a month – that’s without Obama’s cuts!
Obama’s offer would make permanent some of the Bush Tax Cuts for the top 2% that President Obama previously promised to oppose, while raising taxes on middle class workers. The payroll tax holiday would expire, meaning middle class workers will see smaller paychecks in 2013.
Our President is breaking some of his most often repeated promises, and in exchange what are the Republicans giving up? Nothing.
This is an attack on retirees and the middle class, pure and simple. Makes me very glad I never voted for President Obama.
UPDATE: Jane Hamsher: Can We Please Stop Pretending Obama is “Capitulating” on Social Security?
The President has been very forthcoming about the fact that cutting Social Security benefits is something he wants to do. When he said during the debate that he didn’t differ from Mitt Romney on entitlement reform, he meant it. It’s time for people to remove the rose-colored glasses and stop projecting their own feelings on to the man. It’s time to take him at his word.
UPDATE: Boehner dismisses President Obama’s plea for compromise. After Rep. Nancy Pelosi promised to deliver Democratic votes for a Social Security benefit cut, Speaker Boehner was our only hope. And the leader of the Party of NO (or is it Hell NO?) delivered.
Americans Overwhelmingly Oppose Obama Plan to Cut Social Security
David Dayen: Obama’s Latest Fiscal Slope Offer: I’m Missing the Part Where Republicans Give Up Something
More on Chained CPI, the Benefit Cut for Social Security on the Table in Fiscal Slope Discussions
Remember in 2008 when McCain economic adviser Phil Gramm instructed us all that Bush’s Great Recession was just imaginary? “We have sort of become a nation of whiners,” he said.
Now Kevin Hassett, a top adviser to Willard (“Mitt”) Romney’s presidential campaign writing in The Wall Street Journal, tells America that economic inequality is a myth.
“Today we hear that the gains from economic growth accrue to the highest-income earners while the standard of living of the poor and middle America stagnates and the gap between the richest and the poorest grows ever wider,” Kevin Hassett and Aparna Mathur argue. “That portrait of the country is wrong.”
Using a very tired right-wing argument, Hassett says that the availability of cheap consumer electronics, such as cell phones and microwave ovens, means that non-rich Americans have nothing to complain about. But this ignores everyday expenses like food, rent, and utilities. Today struggling families are spending at least 15 percent of their household budget to pay their electric bills.
Igor Volsky on Think Progress:
Hassett argues that safety net programs like “unemployment insurance, food stamps, Medicaid” help families afford basic needs, further shrinking the nation’s income gap. But these programs are already failing to keep up with need and Romney and Ryan have proposed massive cuts to the safety net in order to pay down the deficit and finance a tax cut plan that is heavily skewed towards the rich.
Their approach would only exacerbate the differences between the rich and poor — a gap that has grown dramatically since the late 1970s. Indeed, compared to the 34 countries in the Organization for Economic Co-operation and Development (OECD), the United States has a Gini coefficient — a number that measures the distribution of income on a scale of 0 (perfectly equal) to 1 (perfectly unequal) — of 0.47 and ranks near the very bottom in inequality. America also suffers from the absolute highest “percentage of national income that went to the top 1 percent” and “has seen income inequality increase at a much faster rate than most other countries.”
This trend is already devastating the American democratic ideals of equal opportunity and upward mobility. Unfortunately, neither Romney nor his advisers can see the problem or offer the kind of tax and economic policies that will help solve it.
Via Think Progress.
A hidden-camera recording obtained by Mother Jones captures Romney at a private fundraiser telling donors that, “There are 47 percent of the people who will vote for the president no matter what. All right, there are 47 percent who are with him, who are dependent upon government, who believe that they are victims, who believe the government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you-name-it.
And I mean the President starts off with 48, 49… he starts off with a huge number. These are people who pay no income tax. Forty-seven percent of Americans pay no income tax. So our message of low taxes doesn’t connect. So he’ll be out there talking about tax cuts for the rich…”
Um, in public doesn’t Romney claim the rich won’t get a tax cut, and that he has no plans to raise taxes on the middle class?
David Corn comments:
Here was Romney raw and unplugged—sort of unscripted. With this crowd of fellow millionaires, he apparently felt free to utter what he really believes and would never dare say out in the open. He displayed a high degree of disgust for nearly half of his fellow citizens, lumping all Obama voters into a mass of shiftless moochers who don’t contribute much, if anything, to society, and he indicated that he viewed the election as a battle between strivers (such as himself and the donors before him) and parasitic free-riders who lack character, fortitude, and initiative. Yet Romney explained to his patrons that he could not speak such harsh words about Obama in public, lest he insult those independent voters who sided with Obama in 2008 and whom he desperately needs in this election. These were sentiments not to be shared with the voters; it was inside information, available only to the select few who had paid for the privilege of experiencing the real Romney.
Who are these freeloaders? Is it the Iraq war veteran who goes to the V.A.? Is it the student getting a loan to go to college? Is it the retiree on Social Security or Medicare?
…The people who receive the disproportionate share of government spending are not big-government lovers. They are Republicans. They are senior citizens. They are white men with high school degrees.
The economic growth that actually followed — indeed, the whole history of the last 20 years — offers one of the most serious challenges to modern conservatism. Bill Clinton and the elder George Bush both raised taxes in the early 1990s, and conservatives predicted disaster. Instead, the economy boomed, and incomes grew at their fastest pace since the 1960s. Then came the younger Mr. Bush, the tax cuts, the disappointing expansion and the worst downturn since the Depression.[snip]
Via Think Progress:
A report from the nonpartisan Congressional Research Service concludes that the bottom 50 percent of American households hold just 1.1 percent of the nation’s wealth, down from 3.6 percent in 1995.
The top 10 percent’s share of wealth has risen over the last two decades, the report found, but it has fallen for households in every group below that.
Neither major political party has a plan to address rising inequality in America. Therefore, those of us in the 99 Percent ought to vote for Rocky Anderson for President. Rocky proposes:
- A revival of the WPA to get people back to work, repairing and building infrastructure for the nation.
- Replacing free trade agreements with fair trade agreements to bring back jobs lost to other countries.
- Prosecuting Wall Street fraud.
- No more tax cuts for the rich.
- Restoration of Glass-Steagall regs for investment banking.
- An end to anti-trust exemption for insurance companies.
- Breaking up TBTF banks.
- A single-payer Medicare-For-All health care system.
I would add to this list a financial transaction tax and a millionaire’s tax. But it’s already a long list of policies neither major political party is offering.
UPDATE: A new Senate GOP tax plan released by Minority Leader Sen. Mitch McConnell and Sen. Orrin Hatch would raise taxes on 20 million middle-class households, while protecting the tax cuts for the rich.
Arianna Huffington points to an troubling dichotomy in Florida – people with jobs losing their homes in the foreclosure crisis and education budgets being slashed while well to do retirees ignore the whole problem so long as they can ride around their carefully manufactured world on golf carts.
It’s a story about much more than some people doing better than others. In the course of his interviews, Ben examines the economic gulf that increasingly separates the old from the young, putting flesh and blood on what one economist calls a coming “demographic train wreck.” As the number of elderly Floridians increases, with those over 85 emerging as the fastest-growing group, state leaders are slashing billions from the public education budget, and opportunities for young people — like Dennis Hebert, an unemployed 26-year-old who for a time had to move his wife and young son into their car — are dwindling. Forty percent of Florida’s recent college graduates are unable to find work in the state — a dilemma that’s affecting young people in all parts of the country. As William Collon, a 75-year-old Villages resident, puts it: “The retired folks around here have done just fine. It’s the young people who got in trouble.”
As an aside, the Villages sounds like my vision of hell:
. . . the world’s largest retirement community, the Villages, with 88,000 residents. Here, in stark contrast to the blight of foreclosure, bulldozers clear land for yet more housing construction and residents navigate the pristine grounds in golf carts. The telling statistics are not boom-and-bust home sale prices but amenities: 95 restaurants, 63 swimming pools, 513 holes of golf.
Nothing but old people? 88,000 of them driving around on golf carts all day? It sounds like hell.