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Guest Post: Made In U.S.A.: Wealth Inequality
Submitted by Charles Hugh Smith from Of Two Minds
Made in U.S.A.: Wealth Inequality
Here's the Great Game: mask the nation's rising wealth inequality with Central State spending that keeps the debt-serfs passive--all funded by debt, of course.
While we may not make that much stuff in America any more, we can say that the nation's gigantic wealth inequality is totally Made in the U.S.A. Before we examine the data in some charts, I want to stipulate that great wealth in and of itself does not make a person an "enemy of the people" or threat to democracy. I confess to having generally lumped the top 1% of wealth holders into one category, something I have decided to stop doing, as this misses two critically important distinctions:
1. Not all wealth is created equally. Compare Steve Jobs, who is a billionaire for developing and selling "insanely great" mass-market technologies that people willingly buy because it enhances their lives, with a person who made his $1 billion by insider trading or misrepresenting the risk of his company's stock (basically the same thing). (If you need a hint here, think "Countrywide" or "Enron.")
Clearly, there is a distinction between those two fortunes: one created value, employment for thousands of people, and tremendous technological leverage for millions of ordinary people. The other enriched one crooked insider via trickery and deception.
2. Wealth destroys democracy and free markets when it buys the machinery of governance. Larry Ellison has made billions by developing and selling databases and business services. To the best of my knowledge, he spends his wealth on personal hobbies such as large homes and racing yachts. His lobbying efforts appear to be confined to yachting and the possible purchase of sports franchises. In other words, the political influence of his billions is localized and benign in terms of Federal policy decisions.
Compare that to the millions spent by the "too big to fail" banking industry to buy Congressional approval of their cartel's grip on the nation's throat: Buying Off Washington To Kill Financial "Reform".
Much of the debate about wealth inequality focuses on whether the super-wealthy are "paying their fair share" of the nation's taxes. If we refer to point 2 above, we see that if the super-wealthy are allowed to buy the machinery of governance, then they will never allow themselves to be taxed like regular tax donkeys.
In that sense, the debate over tax rates is pointless, because as long as the super-wealthy own the levers of Federal governance and regulation, then they will buy exclusions, loopholes, rebates, subsidies etc. which relieve them of whatever official tax rates have been passed for public consumption/propaganda purposes.
Let's take a look at wealth in America.
In Who Rules America?, Sociologist G. William Domhoff draws an important distinction between the net worth held by households in "marketable assets" such as homes and vehicles and "financial wealth." Homes and other tangible assets are, in Domhoff's words, "not as readily converted into cash and are more valuable to their owners for use purposes than they are for resale."
Financial wealth such as stocks, bonds and other securities are liquid and therefore easily converted to cash; these assets are what Domhoff describes as "non-home wealth" on his website Wealth, Income, and Power.
As of 2007, the bottom 80% of American households held a mere 7% of these financial assets, while the top 1% held 42.7%, the top 5% holds 72% and the top 10% held fully 83%.
According to the Fed flow of funds data, total assets of households and non-profits (a small slice of the pie) are $71.9 trillion, liabilities are $13.9 trillion and net worth--everything from jet skis to homes to stocks to bonds--is $58 trillion.
Here is a snapshot of total assets by category:
Pension funds and "other assets" include Treasury and corporate bonds, favored holdings of pension funds and the wealthy due to their relative safety and guaranteed yield.
Here is a snapshot of stock ownership:
No surprise there: the top 1% owns roughly 40% of all stocks, and the top 10% own 81%.
Wealth comes from earned and unearned (rent, dividends, etc.) income and capital appreciation, so it's no surprise that the income of the wealthiest segment has also far outpaced the lower 95%:
Meanwhile, the ratio of earned income to GDP is plummeting, which suggests that less of the national income is going to wages and salaries:
Thus it's no surprise that the median income has actually declined during the past decade of bogus debt-based "prosperity":
Here's a snapshot of just how debt-based that phony "prosperity" was:
Private borrowing declined as the home equity extraction ATM was closed, but the Federal government helpfully picked up the slack, borrowing and spending roughly $2 trillion a year so that total debt kept right on rising:
You have to wonder how much of our national wealth is the result of private consumption being transferred to the Federal ledger:
Put these charts together and you get the outlines of the Great Game: to keep the debt-serfs from rebelling, the Financial Elites have OK'd the funding of private spending by Federal debt. The Federal Reserve is a key player in the Game, of course, and its "job" is to suppress interest rates so the true costs of this skyrocketing Federal debt are masked, at least for awhile.
Beneath the happy surface of Federal transfers and spending funded by debt, earned incomes for the bottom 95% are falling and wealth is accumulating in the top 1%. The Federal Reserve's project of goosing stocks and bonds has greatly enriched the holders of those assets, while doing essentially nothing for the bottom 90% except increasing their government's debt load.
It's painfully obvious that the Federal government and the Fed are the handmaidens of the politically powerful Financial Elites. Why spend your own money on bribes, bread and circuses when you can arrange for the Central State to borrow the money? Why, indeed. "Austerity" is of course a modest reduction in the amount of money borrowed and spread around to keep the masses safely passive, but a few trillion trimmed here and there over a decade won't change the Great Game.
Frequent contributor B.C. summarized this reality quite cogently:
The top 1% of US households receive nearly as much income each year as the value of Germany's GDP; and they receive more income than all other nations' GDP (individually, not cumulatively) but the GDPs of Japan, China, and the US.
The financial wealth of the top 1% exceeds the value of the entire GDP of the EU (the world's largest GDP in aggregate).
Moreover, the top 1% could lose 90% of their financial wealth and still collectively have more wealth than all but each of the world's top eight GDPs (US, China, Japan, Germany, France, UK, Brazil, and Italy).
When one hears that wealth and income inequality is extreme in the US, I suspect many do not realize just how extreme it really is.
Peak Oil (falling net energy and available net exports), government "austerity", and the effects of population overshoot imply that wealth and income concentration will become even more extreme, affecting what remains of the professional middle class, who are largely dependent upon the ongoing growth of debt-money and government borrowing and spending.
Thank you, B.C. In other words, the top 15% better keep their eyes on the referee, if you know what I mean.
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Ah, a worldwide corporate income tax. That's the solution. What incorruptible authority could be relied upon to administer such a system? I hear that the UN is available for the job. Oh, wait, I forgot-- the UN is a filthy cesspool of corruption. Oh well.
So JW, how many folks do you employ? What this country needs is employed people with jobs not folks sitting around trying to figure how to divy up the next man money. I would love to see mor Steve Jobs, Bill Gates, etc.
Directly 50 to 100.
Indirectly 400 to 500.
Exxon paid $105 billion in federal income taxes from 2006-2010
How much did you pay over those 5 years?
Exxon employs 83,000 people with an average salary of $65,000/yr..
How many people do you employ and what is their average salary?
Not 83,000 in the U.S.. And where did you come up with 105 billion in income taxes? Maybe worlwide not in the U.S..
Speaking for ExxonMobil were Ken Cohen, Vice President of Public and Governmental Affairs, and Jaime Spellings, Vice President and General Tax Counsel.
what we always need to do is focus on the U.S. part of our business because I said at the beginning that 75 percent of our earnings come from outside the U.S..
And so you can look at that – those numbers in the 10K and come up with total income taxes in the U.S. of 6 billion (dollars) in 2005, 5 billion (dollars) in 2006, 5 billion (dollars) in 2007, 4 billion (dollars) in 2008, and then in 2009, in the depth of this – of the financial crisis, our earnings were down and our taxes were down.
Try looking it up on google. You propbably won't because you don't want to know the truth. I'm sure you guys will look up 2009 though. They paid $105 billion in US federal income taxes. That doesn't include excise taxes and income taxes paid by their employees. Maybe they would have more US employees if they were allowed to do more drilling in the US.
Speaking for ExxonMobil were Ken Cohen, Vice President of Public and Governmental Affairs, and Jaime Spellings, Vice President and General Tax Counsel.
MR. SPELLINGS:
And so you can look at that – those numbers in the 10K and come up with total income taxes in the U.S. of 6 billion (dollars) in 2005, 5 billion (dollars) in 2006, 5 billion (dollars) in 2007, 4 billion (dollars) in 2008, and then in 2009, in the depth of this – of the financial crisis, our earnings were down and our taxes were down.
http://www.consumerenergyreport.com/2011/05/11/getting-to-the-bottom-of-exxonmobils-taxes/
On gross revenue of how many trillion?
On gross profit of how many hundreds of billions?
You want us to fucking clap for them because they can:
Go lick some boots, duplicitous sycophant.
50 to 100 - seasonal work is it? They wouldn't be Mexicans would they?
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snip...
Zero Point Ltd.
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icon Registration Date 2009/12/04 (Year/Month/Date)
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What do you do, JW?
Might be nice to have an employer who is willing to fight.
Why do you constantly cherrypick your numbers?
Why didn't you mention the fact that Exxon paid:
$28 billion in taxes in 2006
$30 billion in taxes in 2007
$32 billion in taxes in 2008
$15 billion in taxes in 2010
Yet you could only find data on 2009?
Your figures are wrong they didn't pay that much income tax in the U.S. .
Speaking for ExxonMobil were Ken Cohen, Vice President of Public and Governmental Affairs, and Jaime Spellings, Vice President and General Tax Counsel.
MR. SPELLINGS:
And so you can look at that – those numbers in the 10K and come up with total income taxes in the U.S. of 6 billion (dollars) in 2005, 5 billion (dollars) in 2006, 5 billion (dollars) in 2007, 4 billion (dollars) in 2008, and then in 2009, in the depth of this – of the financial crisis, our earnings were down and our taxes were down.
http://www.consumerenergyreport.com/2011/05/11/getting-to-the-bottom-of-exxonmobils-taxes/
Thanks cherry picker.
I'm too lazy to get to the bottom of this, but if he is saying taxes and you are saying income taxes, they are two very different things.
Gross taxes and net taxes are also very different things. Then there may be an issue of US taxes paid by an offshore captive entity, or taxes paid by joint development ventures which are not majority owned subsidiaries, which can affect the specific line items that flow from one balance sheet to another. The payment of international taxes by US corporations operating overseas is a product of the tax specific treaties in place between the government of the US and the domicile of the organic entity and the domicile of operations. The article you are linking to doesn't actually get anywhere near the bottom of ExxonMobil's taxes.
on Sat, 07/16/2011 - 00:34
#1461673
Exxon paid $105 billion in federal income taxes from 2006-2010
We are talking about the same thing income taxes. The 105 billion is the same number as his previous post, but this post he left out the words federal income.
I didn't see the previous post. That would rule out everything I mentioned but a difference between gross and net taxation. I am not familiar with the intracies of the domestic side of E&P, but people I trust tell me it is a messy process compared to the way most of the civilized and uncivilized world structures E&P contracts, so I can't imagine that the operational accounting would be any cleaner than the contractual and financial structuring.
I totally agree with Mayhem. I don'y see why you're so hung up on who paid their fair share, or even who gamed the system. Life is not fair, or actually it is, you just can't recognize it as such in such a short time frame.
Why does anyone need to pay their fair share? Why do I need to care if sharper people have luxury yachts? Why do I need to care if I'm wealthier than most? If people have less than me, should I feel bad for them? Fuck no. If people have more than me, should I feel envy? Of course not. Everyone is playing the role they were assigned. If you were born stupid, lazy, or with bad luck, consider yourself lucky. You will learn more from hard times. If you're are able to coast, good for you, but recognize the pitfalls surrounding you. We are all far richer than we realise, and all in existance is nothing but an illusion. Realise the truth of what you are, and the land of form becomes the game it was meant to be.
The Top 1% ALL use Tax Trickery to shift the Tax Burden to those less capable of handling the load.. those that have not participated in such chicanery should be released from prosecution.
But the Majority, have and still do participate in riding rough shod over "We the People" at ever opportunity.
Oh I can't help myself...
Maybe their in the top 1% because they are capable of handle the load? Seems pretty fair, doesn't it?
when discussing who owns what...
and then...
who pays what, with regard to Taxes Collected.. not the supposed 35% Tax Bracket that NO! ONE!! with proper representation is stupid enough to get caught paying.
so the Top 1% (which for me is the Top 1% of Entities more than People and that 1% of Entities may NOT be enough to blanket cover those who circumvent their fair share of the load) owns 42% per this pie chart above? in 2008 which I am sure and we most likely could agree has become a larger number as of today?
The Top 1% does not pay 42% (or whatever the number is / was) of the Taxes.. and to make things worse the income generated by the 42% is "X" amount of the total income produced domestically.. which I can assure that there is NOT an equitable amount of taxation from that income group.
Compared to Joe Smith the plumber who is taxed at? 25% all in call it.. well I dont know anyone that pays north of 10% in Taxes.. and 10% is wayyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyy the fuck up there for some people.. given the structure of irrevocable trusts, P.E. Accounts and or add in whatever other scam you would like ______________ there.
‘Dutch Sandwich’ saves Google billions in taxes Internet giant uses complex structure to keep its overseas tax rate at 2.4%http://www.msnbc.msn.com/id/39784907/ns/business-us_business/t/dutch-sandwich-saves-google-billions-taxes/
One of the most depressing statistics in the depressing June jobs report was
another decrease in the employment-to-population ratio. This ratio, which
shows the percentage of American adults (16 and older) who are working,
dropped again, to 58.2%. This is the lowest level since 1983.
JW
I don't usually agree with you.. but this post on right on target for what I am thinking.
I was watching a news show last week, hosting a business leader and a politician, and the business leader was suggesting that taxing the wealthy was unwise because they would always find a way to avoid higher taxes. Then the politician agreed, stating the the top earners already paid over 60% of all income taxes.
The poor host did not have the stones to suggest that if the top 1% of income earners were only paying 60% of income taxes.. then the income tax schedule was broke. If the top 1% of income earners were only paying 60% of the income taxes, then certainly a progressive income tax would require them to pay 99% of income tax collected. The remaining 99% of income earners should only be paying 1% income tax collected, not the 40% that they are in fact paying.
And this calculation does not even include the rate of taxation imposed by payroll taxes.........which nealy disappears at a number a little over $100,000 income per year. But requires a worker earning $20,000 to pay 7.6% and his employer to contribute another 7.6%. Any employer would be happy to pay the worker the additional 7.6% in wages if he did not have to send it instead to the Federal government.
I for the life of me don't understand why this is so hard to communicate to the voters. Are the politicians so inept, or are they so dumb?
Thanks for the opportunity to vent!
Bill
You go get em BB. The problem is not taxation without representation but representation without taxation. Hell, lets just vote the top 1% into slavery. You bake the bread and I'll eat it. That ends when the 1% or top 5% say f**k you and go to singapore or chile. If we don't want em somebody else will.
http://www.youtube.com/watch?v=2V5JMZnWl4Q&feature=related
A History of Money and Banking in the United States (Part 1, 2/4) by Murray N. Rothbard
I am hanging them and re-distributing thier ill gotten gains!
Don't worry about top 5%. Worry about top 500 wealthiest old money families in US. They are not merely rich. They have power to set who gets rich and when. And they already said F**k you and sold out the American middle class in favor of non-American slaves, in exchange maintaining wealth parity with non-American super rich.
That line of thought is why Aristotle would have called you an utterly inferior being.
"America pays its bills"
Watch for this idiom each of the next three times the debt ceiling is raised via the McConnell plan. It will be uttered by both the democrats and the republicans.
The voters ARE being communicated to with this absolute precision necessary to control the mob. Specifically the 60% of the rich and poor who receive transfer payments from the rest, mixed in with Ben's hot printed money to give it some legitimacy.
One of the most depressing statistics in the depressing June jobs report was
another decrease in the employment-to-population ratio. This ratio, which
shows the percentage of American adults (16 and older) who are working,
dropped again, to 58.2%. This is the lowest level since 1983.
I can't see why this is depressing. If the working class are getting fucked, start killing people, or leave the country. Simple enough choice I think.
are you stupid enough to think that being in the top 1% means you should pay 100-1 % of the taxes? The top 1% doesn't earn 99% of the income nor have 99% of the wealth.
You idiots and your fascination with taxing everybody other than yourselves. Yeah, let's put more money in the hands of the government...morons.
So they (full disclosure: we) take home ~20% of the income, ~40% of the wealth and pay an average effective rate of ~22%.
They are more than welcome to reduce their tax burden by foregoing that income at any time. Somehow, I don't think they'll be up for it. I know I won't.
General Electric (GE) deserves special mention. TheNew York Times reported that its total tax payment amounted to 14.3% over the last five years.4 Citizens for Tax Justice promptly corrected it: the profits tax it paid in the US, (as opposed to its worldwide taxes on its worldwide profits), is only 3.4%.5 Thus, GE paid a far lower tax rate on its income than most Americans paid on theirs. In 2009, GE received a huge $140 billion bailout guarantee of its debt from Washington.6 By choosing GE's chief executive, Jeffrey R. Immelt, to head his Economic Advisory Panel, President Obama effectively rewarded the corporate program: give us more and tax us less.
http://www.rdwolff.com/content/corporations-government-give-us-more-tax-us-less
JW,
You are drawing a distinction between PERSONS, NATURAL PERSONS, and ORGANIC ENTITIES that is way above many heads here.
The top percentile of NATURAL PERSONS filing a form 1040 for 2008 was $380,354.
http://www.irs.gov/taxstats/index.html
The top percentile of NATURAL PERSONS filing a form 1040 do account for over 40% of the income taxes received/pilfered by the US federal government.
Anyone making less than seven figures is going to be hard pressed to afford "proper representation"
Anyone making six figures in the US is probably paying more than their fair share of US income taxes, given the huge percentage who are paying nothing in income taxes, or are paying net negative income taxes to the federal government, just like the large corporations.
Dup.. so have a tune instead! Metallica - The Struggle Within
http://www.youtube.com/watch?v=ufCvtKfR2OI&feature=related
Man that shit just rocks. thx for the post
We shall over come Brother Obadiah! will it be sooner rather than later is my only prayer!
http://en.wikipedia.org/wiki/Angelo_Mozilo
http://en.wikipedia.org/wiki/Joseph_Cassano
http://en.wikipedia.org/wiki/Bernard_Madoff
http://en.wikipedia.org/wiki/Allen_Stanford
http://en.wikipedia.org/wiki/Kenneth_Lay
http://www.forbes.com/2010/05/28/billionaire-convict-inmate-fugitive-san...
Try again, cupcake.
+100
You forgot to list the 10000 wealthy people who didn't commit crimes, cupcake.
I wasn't the one who made a dumb assertion that the entire top 1% "earned" their money and thus am only required to provide a single counter-example, but gave several.
But thanks for playing, Chippendufus.
You forgot American princess, Paris Hilton.
If you wipe out the top 0.01% of entitled rich, then the rest will survive.
If you wipe out bottom 99.9% of worker bees, then entitled rich will have to do the shitty work themselves.
If we wipe out all the marxist asswipes like you, the world would be a better place
I guess the Marxists are lucky lazy mofos like you are too busy shuffling tax forms to lift a hand then.
Amen to that brother!
Maybe their in the top 1% because they are capable of handle the load?
speakie the engrish
but what on god's green earth does the government need with so much money? Cut it all back down to a simple poll tax at a low rate, to pay for the skeleton of common defense and courts. (most of the national defense should be taken care of by all able bodied citizens serving some time- not contracted out as it is thse days). If the government hasn't got the means to subsidize those ultra rich SOBs, if the government doesnt have the means to play enforcer and protector for their interests... watch how fast those massive fortunes erode back down from astronomically rich to merely wealthy. The elites need the state far more than you do.
Paris Hilton says, thank you for making my inheritance bigger than ever!
Capitalism doesn't work when 60% of elites simply inherit wealth and rest just get lucky. Your phD, MD, risk taking, and hard work, smart decisions are not enough when idiot sons and daughters inherit a billion dollar empire. Free market my @ss. Meritocracy my @ss.
http://www.youtube.com/watch?v=620CipI1m3I
23 things they don't tell you about capitalism. Rich don't want you to know the truth.
The presumption being those with wealth are preventing others from getting it and that it is all a big zero sum game.
The wealthy are not creating any wealth except taking a bigger piece of the pie.
When those of wealth control means of production, then yes they are preventing others from growing wealth.
When employees get 5% "performance" salary increase for doing the work and wealthy increase their stock equity by 25% annum propped up by central banksters, then yes the wealth creators are not getting a fair share and not getting wealthy.
Also at the top 1percentile, the pie doesn't grow. It is a zero sum game because power is a zero sum game. As long as wealthy control the whole pie the pie size doesn't matter and you get only a crumb when you are the one who have grown the pie larger.
Are you one of those who think capitalism is working because your home value doubled while negating the fact that wealthy made sure your gain is offset by loss in social programs like education, retirement, and healthcare? Look at the big picture. wealthy makes BILLIONS A YEAR producing nothing. Don't even get my started about corruption.
Society has reponsibility to set how people get rich.
U just jelly!
"society has a responsibility..."
And who, pray tell, will represent "society"?
They went down this road in Russia circa 1917. Only about 100 million people were brutally slaughtered or starved as a result.
AH will probably be one of the parti apparatchiki who get to determine what the glorius workers get to keep.
so you think we don't live in a society?
society defines everything of value outside of your immediate physical needs.
There will always be someone defining what workers get to keep. owners of capital are turning out to be not the best judges either.
The balance between workers keeping too much vs. capital owners keeping to much is the question. If you fail to see that capital owners risk nothing but keep all the gains of today's society, your children will be keep nothing you have earned. That's they society you will leave behind.
The government has done a great job of it. They gave Wall sTreet a few trillion dollars.
Capital owners risk nothing? You're a fucking moron. If I buy $100 worth of stock, I risk $100. If I put down $100,000 to open a restaurant, I risk $100,000
Fed is subsidizing the risk through bailouts you mentioned.
You buy $100 worth of stock, bernanke put will make sure you are not risking the entire $100.
When you lose $100k from failed restaurant, society allows you to take capital loss exemption against future capital gains on your taxes your whole life. That's society subsidizing risk for you.
Also when idiots simply inherit 100M, what did they risk to gain that?
How about that NY Fed bankster Stephen Friedman who "risked" his own money to buy stock in banks which he knew was going to be bailed out. Insider trading is nearly zero risk.
How about CEO's with backdated options with guaranteed profit...nearly zero risk.
How about politicians being sold a million dollar house for $1 from their pal they traded favors for?...zero risk.
How about billionare Rajaratnam's inside trading on upcoming mergers or acquisitions?
Today's elite rich are full of such capital owners. Don't you understand that only morons like you HAVE to take real risk, because you are the peon of capitalism. For the rich, the rules don't apply.
" I don't throw darts at a board – I bet on sure things." - Gordon Gekko from Wall Street.
You buy $100 worth of stock, bernanke put will make sure you are not risking the entire $100.
BULLSHIT. Unless you are splitting cunt hairs with a single unleveraged equity and you see an worthy distinction between losing $99.oo and losing $100.00
When you lose $100k from failed restaurant, society allows you to take capital loss exemption against future capital gains on your taxes your whole life. That's society subsidizing risk for you.
That is not a subsidy that is an offset. There are a ton of rules and limitations on offsets which reduce the amount of loss that may be offset. Probably the most notorious is the one that hits non-TBTFs who want to play the fiat ponies, where capital-loss-carryforward is limited to $3,000 per year. Some 60 year old guy who was down a couple hundred thousand in the 2008 crash and had to liquidate is going to be hard pressed to live long enough to offest that loss at $3,000 per year- and THERE IS NO OFFEST IF HE MAKES NO MORE MONEY. Social Security, Welfare, and SNAP, however, are subsidies.
Are you saying Bernanke put doesn't exist....on Zero Hedge? so the TBTF banks were allowed to fail? AIG was allowed to fail?
That 60 year old guy sure lost some money, but overall he had his ass saved by Bernanke. Otherwise he won't be down couple hundred thousand. His equity portfolio would have been completely wiped out. US is bankrupt and all banks are insolvent. What part of the massive government bailouts did you miss? All bailouts are risk subsidies from uncle sam.
This whole crisis put your theory to rest. You sound just like the banksters who said, it is all merit so let us take the profit privately. When things went south, they took the bailouts.
Educate yourself.
http://www.investopedia.com/articles/financial-theory/09/government-subs...
"Many would argue that if it weren't for the government absorbing some of the risk of loaning money, depositing money at banks and producing automobiles or other goods, many industries would grind to a halt."
"Many people don't realize how dependent the American economy has become on the government subsidization of risk. This is due in large part to the fact that many people are only familiar with the government's few "explicit" subsidizations of risk, and not the numerous "implicit" guarantees the government provides for other organizations."
Wow you're seriously stupid. You want people to pay taxes on gains, but not be able to offset their losses. So basically, if I make a profit of $100 one stock trade and a loss on one stock trade of $100, you want me to pay taxes on $100 of profits even though I broke even. Either you work for the government or you've never worked a day in your pathetic life
not to mention "wash sales" where ya can't even claim your loss, or the pathetic $3000/yr limit
who said anything about taxes?
also not all capital gains are created equal. you can profit $500k from your home tax free.
offset is different from loss carryovers over a lifetime. markets are for investing. day trade at your own risk. who the heck says you are entitled to break even and make a living trading stocks at home? does your broker give you transaction fees back on stock loss sale? wall st. charges you for every move. Be thankful government is not charging you a fee like that.
If you work for salary of $100k on year, then be unemployeed the next year, you want government to give you a income tax credit for when you didn't work so that you can break even?
you go gamble at a casino, and gov will tax you the hell out of any gains, but only comp you are going to get is from the casino if any.
Nah, it's usually the ruthless paranoid schizophrenic that gets that position. Only people like Stalin, Hitler, Mao, Chavez, Castro, Pol Pot, Saddam Hussien, Kim Jong Ill and such ilk make the top grade. These folks are the ultimate in back stabbers and won't have any second thoughts in dropping you into a vat of acid if they believe you're a threat to their diabolical plans.
All the philosophers and ideologists usually get trampled into dust during the bloody turmoil and have no idea what hit them or why.
+1 Nailed it. All these Bolsheviks just dying to let the dogs of civil war loose.
Only in America, it is the banksters like Rubin, who hold up ideals of capitalism and private profiteering while exploiting every loophole including socializing their gambling losses. You won't hear the truth from American mass media.
++++++++++++++++++++++++++++++++++++++++
You are a Fantastic Human Being! Thank You for being Brave enough to share the Truth in a Two Party World!
I didn't know Stalin, Hitler, Castro, Pol Pot, and Hugo Chavez were Americans.
Do you often have these kinds of reading comprehension problems? Perhaps a neurologist could provide assistance.
Wow, you really are a broken record.
Yawn. That's not capitalism.. Have you ever pulled out a book on free market theory?
Capitalism is not about free markets and never has been. We have capitalism; we do not have free markets.
Government in control of the economy is "command economy" We do not have Capitalism. Your comment is silly.
Exactly. the wealthy do not produce by themselves, but through risking their capital in investments into productive assets.
But recently, there is no risk due to government subsidizing the financial sector. there is no incentive to invest into productive sectors. Instead they invest in controlling larger share of the ever shrinking pie. As long as they maintain that control, they will feel wealthy, but in the long run, everybody loses because the pie shrank.
communism also had a book of theories. in practice, it failed.
you need more proof then today's America that free market theory is also failing? perhaps not directly, but indirectly due to inherent human flaws?
communism also had a book of theories. in practice, it failed.
you need more proof then today's America that free market theory is also failing? perhaps not directly, but indirectly due to inherent human flaws?
communism also had a book of theories. in practice, it failed.
you need more proof then today's America that free market theory is also failing? perhaps not directly, but indirectly due to inherent human flaws?
http://www.youtube.com/watch?v=NugRZGDbPFU&feature=related
http://www.youtube.com/watch?v=Ql3Jp3ydfE8&feature=related
Maybe I'm misunderstanding what you think "zero-sum game" means.
How many people can "own" the same $1 at the same time?
When few shareholders combine forces to own 51% of the company, the other 49% doesn't matter what they do. Individually, the combined forces might only own 5% each. But together, they control the entire company. They can crash the companies stock, but their relative control stays the same. They fail themselves but the others are also taken down with them. Nobody bring about change. Only two solutions: 1) the 51% fight each other and the control is divided 2) the other 49% starts a new company
In nation-state terms: 1) civil war 2) start a new country (but earth ran out of land)
Power and control is inheritantly a zero-sum game becuase they are defined relatively.
In US, the pie has been shrinking (your living standard per work done) last decade and elites have taken even bigger slice of the pie. But nobody can do anything.
Yep. I don't think that guy really understands what "zero-sum game" means.
Zero-sum game: they win, you lose.
They make billions, you make pocket change. You didn't get richer you just have been had by "wealth effect" for dummies.
Most valuable resources are limited (time, space, power) and thus zero-sum.
That's not what "zero-sum game" means. Zero-sum game means that no actions which award "points" to one player will also award points to another player.
Cooperative games (non-zero-sum) may also result in one winner and one loser, but the actual progression of the game may result in circumstances where both players work together to receive reward.
Property ownership itself is inherently zero-sum, because two parties cannot "own" the same property. Everyone likes to trot out the idea that capitalism is not zero-sum, but not many folks realize just how badly they've been fooled by that cliche.
I understand zero-sum and see it everywhere ie. options.
look here and see that the higher in Maslow's Hierarchy of Needs a need is placed, more zero-sum it gets.
http://en.wikipedia.org/wiki/File:Maslow%27s_Hierarchy_of_Needs.svg
Capitalism is good for growing the quality of material goods pie. but some pies just can't be grown.
In real life, life is more zero-sum than others: Have X cannot exist without have not X.
You chose a very poor example; most of the "needs" in that hierarchy (pretty much everything except food, water, property, and resources...as if the first three weren't the latter) are positive sum (we can debate about employment, but sex, friendship, morality, achievement etc are at best artificially limited).
consider the entire hierarchy of needs, not just basic needs. plus the most basic needs, you don't need capitalism. market means of exchange is not capitalism.
and anything beyond 'basic needs'? how would a simple market of exchange provide for say...research into life-saving medical treatment?
Now define 'Pareto Optimal' and tell us if and how it applies to zero sum games.
Why?
Testing different game-strategies over repeated trials can generate strategies which can demonstrate pareto-optimal "outcomes" only if you start with an assertion that every player deserves equal numbers of wins/losses.
That's not usually how people think about games.
Let me know the next time you're reincarnated and get to try another "strategy"; that's not usually how people think about life.
Fooled me. I thought you might have something worthwhile to say for a second. Now I realize you're just trolling.
I had no such delusions about you.
I think AH would have been great in the "static universe" crowd of the late 1800 early 1900s.
Think harder and you will see that pie growing larger doesn't mean much. Plus the pie hasn't grown for a while at the same rich got a bigger piece of the shrinking pie. Worst of all outcomes.
Do you want to be born a King in 1800s and face the threat of dying with common cold but be the most powerful person in control of one's destiny or a modern day day laborer who can purchase things like iPads but slave of the banksters? Who would be happier?
Remember happiness is largely related to your relative position in society and has nothing to do with material substance.
Happiness is even more related to not caring about your "position in society".
I assign this the best post on the thread award.
Is that because of the hypnotically jiggling ass? :)
I assign this the best post on the thread award.
I assign it the best avatar.
Easy not to care if you are born into high status.You sound like an over priviledged prick.
If you really believe that then I dare you to trade position with an illegal alien at a local home depot.
You missed my point, you hysterical commie.
Check it:
http://en.wikipedia.org/wiki/Status_Anxiety
Also, you really ought to learn to spell the word
privilege.I dare you to promise never to give more than bread and water to your children, just to make sure they are not privileged in any way.
And illegal immigrants should get the f**k out.
So you admit you will give your own children a better start in life if you could than other children. Meaning start the on a higher rung in the status ladder sufficient enough to at least keep the status they have inherited.
There in lies the problem with capitalism. It conflicts human's desire to pass their earned merit to their offspring. Access to opportunities are not the same. Thus achievements are not sorely due to merit but also who your parents are.
You can at least admit it is not fair and get off of your high horse. Admit that you have certain privileges of being a citizen of a country vs. illegal aliens who do not have had access to equal opportunities!
error.
Bereft of ponzi economics and the creation of 'money' out of thin air/usery, wealth is largely IS a zero-sum game. Actual GDP grows very slowly, even as reported (and gamed) by the propaganda bureaus, and throughout most of human history was basically stable/flat (pre industrial revolution = cheap fossil fuel energy being utilized). When "wealth" grows faster, you have inflation (don't need a fiat currency for that....the Comstock load discovery, huge influx of silver on the market, caused the price of goods to rise across the board), which once again levels the field. To quote from famous libertarian Robert Heinlein - "There's no such thing as a free lunch."
When you sell an asset, someone buys it. Both counterparties think they are getting the better deal. Net/net. This is the essence of business boiled down. But once you start adding in non-productive drains on this transaction, i.e. rent seeking behavior, any productivity or efficiency gains you may have enjoyed are largely negated.
As someone who drafts the documents to help ensure wealth stays tied up within the family and who has to deal with wealthy persons on a daily basis, I can assure you of one noble truth: wealth can take generations to accumulate, but it can be spent in an instant. While you may be correct on a very short snapshot, if you expand the timeline another generation, the persons who did not create the wealth, generally speaking, have no appreciation for it nor ability to keep it. It is INCREDIBLY rare that the drive a wealth creator has is transferred to his or her progeny... for there to be a multi-generational shared vision, common goal, work ethic, and appreciation, a perfect storm of so many factors must merge... it just doesn't happen often...
I can't tell you the number of times patriarch dies and the vulture heirs start circling... and before an estate can be closed, virtually all the bones have been picked clean... family members fighting family members over the scraps... it's very often times... obscene. And, to make matters worse, all the hard work and effort is spent in months, if not weeks... a lifetime's effort gone in an instant...
"Capitalism" is supposed to require creative destruction, you know.
"Capitalism" is supposed to require creative destruction, you know.
You would think so...but it certainly has not materialized in this economic fiasco.
the creative destruction required for true and just equillibrium..was impeded by the many invisible hands..from the powers that be...ie F.A.S.B .
creative destruction is one thing... mindless consumerism is another... regardless, it's as certain as gravity...
I'll also posit that creative destruction is a paradox for capitalism... I know I harp on this, but if capitalism predicts the normalization of profits in every market with perfect competition, then what do rational actors do to avoid this? If capitalism is ever paired with a political system, then the result is necessarily barriers to entry, more complicated bureaucracy, and a concentration of wealth... as the political system becomes captured with the capital... (or, sometimes, just magically created bullshit).
The result is more what I would call destruction... and, hopefully, something creative emerges... but to call it creative destruction, at this juncture, is premature. Hopefully our backs are strong and our hands callous quickly.
Mindless consumerism is a huge capitalist success-story for the inventor of the pet rock.
The thing about markets, and really all biological equilibria, is that there's no such thing as "bad news" from a non-subjective viewpoint.
The past 40 years or so are a huge success story for 3000 people with net worth over $100,000,000 or so. There's nothing demonstrably "bad" going on. It's very very good for a small group at the expense of 6 billion.
But they're the folks who run the show, so of course as rational actors they try to maximize their benefit.
Looney troll can rationalize anything.
Not getting enough attention at home, huh?
a) Capitalism doesn't require creative destruction, it merely has that as a potentially supported outcome
b) WTF does that have to do with a squandered inheritance?
Creative destruction is when an old market is supplanted by another (likely superior) one...not any random act of capital destruction.
Macho, seen this in person. Parents died after a long life of hard work and prudent money dealings, left each of 3 kids about a million. Fighting, stupidity, obscene. One drunk to death in short order, one blew it quick in SF on "art" that was pointless, and only I still have a stake, mostly because I'd already earned my way to relative riches on my own (insofar as anyone does -- their teachings and of course, the people I worked with in my business were big contributions). So, 2 of 3 mil up in smoke in months, and the only one who still has any doesn't really need it much. Go figure, humans are so dumb I'm often reluctant to admit I'm one.
But you are NOT the problem.. you work, you provide others jobs and you provide a service or something of value to your community.
Macho will get this and I assume you will as well..
It is more about the entities created that go on and on and on.. or even the short lived entities that extract wealth and then distribute the monies and disappear before any litigation can transpire. The people that build and maintain these types of paper chase that need to be routed out by the Almighty God!
I will as well touch on the "Irravocable Trust" Mr. Macho.. and for those of us that consult for trusts that bare our names.. or even those who do not consult, those who do nothing. There are a great many lazy rich kids.. but they are NOT the problem, they are innocent. Now the Money Managers for the Trust maybe a problem for the populace at large.
We need to rid ourselves of soulless corporations run by people with a quarterly bonus mentality.
We need to rid ourselves of the Government that is owned by these short term mentalities..
and only then will we as a Nation be able to move forward with any kind of security for a future.
I've got too much pride to ask for a handout, or to be a vulture; everything I get in life, I'll work for it.
I don't take any 'freebies.'
so the entirety of the GOP and most of the Dems should be prosecuted?
maybe a flat tax and zero exemptions would do it? Stop laughing dammit!
Or... should it be the other way around? I forget, how does trickle down work?
"maybe a flat tax and zero exemptions would do it? Stop laughing dammit!"
I'm not laughing...neither will statists and lobbyists of all descriptions shortly.
More hair on fire, sky is falling histronics coming on July 26 after a certain House Committie hearing, so gird your loins ;-)
"I forget, how does trickle down work?"
It only works with Liquids.
A rising tide of H2O lifts all boats, but a rising tide of $'s only seems to lift the yachts. The row boats seem hardly to rise at all.
Trickle down always works when prices rise. Haven't seen gas prices go down when oil does, in concert, but let that sucker go up and wham...
Wiping out the tax code and starting fresh is the only thing that will bring us out of this funk. The last remaining sheeple who pay more than 10% are finally waking up. Timmay, Ben and Alan G. have been non-stop begging for it for the last 2 years.
The lobbiests and Tax LLMs are perfectly capable of performing "other" services for both the rich and the "poor" who game all ends of the system.
Bachmann has an LLM Tax. She is either going to have to campaign on engineered demolition of the code, or she has no chance in the presidential race. Obama would crush her.
on Fri, 07/15/2011 - 17:03
#1460934
so the entirety of the GOP and most of the Dems should be prosecuted?
maybe a flat tax and zero exemptions would do it? Stop laughing dammit!
Or... should it be the other way around? I forget, how does trickle down work?
********************************************************
All of the above need to be removed for Treason.
Trickle down in action:
http://thenextweb.com/shareables/files/2009/12/pyramid-of-shit-1.jpg
We could have easily fixed the inequality if we let the system reset in 2008/2009. The rich who own all the paper wealth would have been wiped out. Middle class savers (like myself) would have bought the remaining productive assets and generated real wealth for the country. Would it have been a really tough time? Yes. But we would have emerged better on the other side.
America chose not to do that. Instead, we've launched plan after plan to make the rich even wealthier. We've grown the size of the government and increased it's ability to protect the assets of the rich, because the government had to "do something."
Now, we are undertaking a "something" of currency devaluation which will really kill what's left of the productive.
So, despite the fact the government was a primary party in creating the mess, you are saying if the government would get out of the way, the marketplace could have resolved this. Agreed.
Yes. There are many in this country who think the government is there to help them. That is totally false. The government, in it's current form, exists to make the rich even richer and asset-strip the American people.
The government needs to allow the market-place to erase the phony wealth of the "rich." The government will lose the ability to do this at some point in the future anyway as people lost faith in US Treasuries and the Dolar. Might as well do it now. We are just building up the pressure in the containment vessel.
Yes. There are many in this country who think the government is there to help them. That is totally false. The government, in it's current form, exists to make the rich even richer and asset-strip the American people.
The government needs to allow the market-place to erase the phony wealth of the "rich." The government will lose the ability to do this at some point in the future anyway as people lost faith in US Treasuries and the Dolar. Might as well do it now. We are just building up the pressure in the containment vessel.
Close, but not quite. The government exists to (1) make the wealthy elite that controls government wealthier, and (2) create an underclass that is 100% financially dependent on the government that will do what the government tells them to do. There is no room for a middle class in this equation.
that is clearly where it is at now along with existing to make sure different rules apply to us and them. Govt and them are the same entity. Many of "us" don't realize that yet. When they do, things get...historical
unfortunately the reset is still coming.
It use to be that it was forever-and-a-day away.
Then 2008/2009 it came close, but Bernake, Congress, Bush and Paulson made sure they could extend and pretend.
The extend and pretend has extended the life of the sucker, but the reset button is ever more precarious.
As much as Owebama would like to disagree, we are very much like Greece. Greece came close to the reset button 18 months ago, had the ECB extend-and-pretend. Now the problem is even bigger, yet the reset button looms ever larger.
I think I speak for a lot of people here, we're getting tired of the political gamemanship, the BS, the rhetoric and the debasement of our currency.
A reset now would indeed bring hardship, but at least would could direct who would be hardest hit (and we would hope that would be the military-industrial complex).
If they extend this sucker with QE3/4/5/6, TARP2,3,4,5 and $1.6trillion deficits for the next 10 years, EVERYONE will have extreme hardship.
Wealth inequality isn't a class problem, it's a cultural problem. As long as the non-wealthy vote against their own interests and don't hold their elected representatives accountable, nothing will change. People don't want to stand up against corruption because they think that one day, they'll have enough money to benefit from policies that currently hurt them.
Ding ding ding.... winner winner winner
I would posit that the lowest class does not believe it will break through the glass ceiling and blatantly accepts what handouts are given, without care for corruption, etc. If you do not produce, then why would you care if corruption takes away the fruits of others' labor?
The problem isn't a societal problem, it's a systemic governance problem. This is the inevitable conclusion of a democracy... our republic, which conceptually would protect minorities (e.g. the middle classes at this juncture), has been usurped by the clowns to the left and the jokers to the right.
In short, I'll posit that the lowest classes have ratified all political actions while the middle classes are impotent to politically defend against their ratification (as well as the perpetual corruption inherent at the top).
well said macho. People are confusing society with corrupt systems. Systems which in theory, are supposed to exist for equality of opportunity and access. These systems now work for the exact opposite goal because these systems are now infected and run by the very forces these systems were created to counter.
+100
Rich top 0.1% have brainwashed bottom 51% to gang up on upper middle and middle classes to do all the work and pay all the taxes.
In America, it is good to be rich or poor. Well, with the austerity, poor are about to get it.
the middle class is a minority in the US, the country where the middle class is the King class?
The lowest class is indeed known as havin a high turnout rate, well known...
++++++++++++++++++++++++++++++++++++++++++++++++
The dumb fuck broke morons hurt themselves! all becuase the preacher told them painting abortion signs is more important that not!
but truth be told no matter which way the idiots vote they are screwed..
Obama has done far more damage against "We the People" that George did, because people were watching George but with Obama the Liberal was NOT expected to cut Freedoms and / or the like.. Clinton the same thing.
There is no difference between them behind closed doors.. it is more for us and less for them and thats the rule.. this ideology is not sustainable and it is only a matter of time before the "Sheepeople" rise up because of the disparity.
Business Seen Vulnerable in Eventual U.S. Tax Revamp
07/12/2011 4:51:37 PM ET
WASHINGTON (Reuters)—Tax reform could spell the demise of corporate tax breaks such as the domestic production credit, but don't hold your breath waiting for it, says Scott Hodge, a 20-year veteran of the Washington tax wars. Comprehensive tax reform may not come until 2013 and when it does, the handful of corporate tax breaks to be curbed could include the credit which rewards companies for making things in the United States rather than abroad.
with propaganda like above you can barely expect those who can barely read to understand what is happening to them.
But once again.. they will catch on, it is only a matter of squeezing.. how much more can we get out of that old cow before she bucks and tears up the stall?
"Financial Innovation".
http://www.youtube.com/watch?v=h3BJl5Zy7HQ&feature=view_all&list=PL0442BCED7088535E&index=21
Super ultra wealthy use merely rich to convince the rest of the sheeple that they deserve the position they inherited.
RICH Doctor: "I save lives and went to years of training only few can pass, so I deserves more money than 90% of the population"
PARIS HILTON: "The Doctor is right. Money is merit. I have more money than a doctor, so I'm smarter and better in every other quality. I'm entitled larger share of control over other people's lives. Luck has nothing to do with it. Just ask a doctor. Also I should get taxed at 15% while Doctors should get taxed at 50%."
Think people, think.
Ultra rich doctor:" I saved only one life in my carreer but it is was a worthwhile effort"
Paris Hilton: "Yes, that is right."
This is an interesting comedy, anyone know when it was made?
http://barneymiller.webs.com/apps/videos/videos/show/12474157-barney-miller-4x22-the-sighting-
Barney Miller? Classic from the mid-to-late 1970's.
1975-1982
More here: http://en.wikipedia.org/wiki/Barney_Miller
It's not until about 8 mins in that you get a clue what scratch's point was.
Nothing wrong with good old fashioned capitalism where both buyer and seller walk away happy, but the FED's gotta go. No fractional reserve/credit dependant, must-grow-or-die system can escape the complete end game we get to play next. Like the man said, we drew the short straw.
1 in 10 holding 80+% of the wealth dont bother me so much
.
its the disconnect republinazis provide these morons to livin a gated community surrounded by prisons populations in excess of their design working in a media exposed corrupted payments system that plays on their fears of a non-globalist 'financed' empire
.
our mature wealth and leadership suffers from stockholm syndrome embodied by a phantom population of suckers invented to serve the interests of globalism and super national government.
.
near as i see it were police state bound until its just the USA for everyone rite
.
cops sure as hell take orders from the supereconomic powers and dont see no justice that needs doing and will march SD style into history... revolution aint cheap or stupid
Concentration of wealth leads to economic collapse. Slavery was one answer.
The question should never be: "how much money should one be allowed to make," but " how shall we allow people to make money?" Smith never said wealth was bad. He was pointing out that there is honest wealth and corrupt wealth. Productive wealth and consuming wealth. We have the laws to fix all this. We just have to apply them equally to everyone.
Oh. And term limits.
+1
And he was wrong. That is only consumption as production is consumption. That is what happens when people clings to the fantasy of a man who lived 300 years ago.
"Here is a snapshot of stock ownership:" chart kinda looks like a peace sign turned on its side, so were all good right?
Eactly--the author's point was that persons such as Jobs and Ellison benefit the economy, while the banksters buy political access, and through that, favors. Unfortunately, it's not limited to the banksters (e.g., GE, GM, etc.). The latter are currently protected classes in the sad system of crony capitalism.
"Wealth destroys democracy and free markets when it buys the machinery of governance."
Exactly.
Well done.
Neither conservatives nor liberals seem to get it; we are past the point of no return.
Our groaning behemoth of a government, that two-headed hydra of socialism and crony capitalism, has sold out the responsible middle class citizens.
Kill the beast!
If wealth destroys democracy then - Good! Bring it on!
I enjoy CHS's writing but I wish he'd get beyond this democracy thing. We've all been indoctrinated since childhood that "democracy is good" but the facts show otherwise. Unbridled democracy is a big part of the problem. See Hans-Hermann Hoppe.
51% of the sheeple (ZHer term) vote for the politician (left or right makes no difference) who promises to plunder the losing 49%. But on issues that are important to the ruling elite there is no difference between rep/dem, left/right, red/blue, whatever.
If democracy is such a good thing, why is the USA USA USA the most bloodthirsty, war-like and bankrupt political entity on the planet?