Americans Are Shorter, Fatter, And Have Less Longetivity

 These charts (from The Wahington Post) are troubling. They show that Americans are getting shorter and fatter, and their longevity compared to other nations has dropped significantly. One might ask why this is happening. I think a big clue is contained in the charts (especially the chart below).

Note on the charts that the problems with height, weight, and longevity started about 1980. What happened in 1980 that could have caused this? The Republicans gained enough power to change the country's economic system.

Their new "trickle-down" system tilted the economic playing field to favor the rich to the detriment of 90% of Americans. They said giving the rich more money would benefit everyone, because that money would trickle down to the rest of the country.

That didn't happen. The rich did get richer, but nothing trickled down. The bottom 90% saw their wage remain stagnant and be gobbled up by inflation.

How does this relate to height, weight, and longevity? Because if a person has less money, then they get less food, shelter, and adequate medical care (because the price of all three has grown significantly). Income/wealth is a big determiner of health, and the poorer the health, the more it affects height, weight, and longevity.

The Republican's horrendous economic system is not just unfair, it is actually affecting the health of most Americans. This can be fixed, but not until the Republicans are voted out of power!

Minimum Wage Is Not Even Close To What's Needed

The charts are from a Gallup Poll -- done between April 3rd and 25th of a nationwide sample of 1,013 adults, with a 4 point margin of error.

Wealth/Income Inequality Hurts Economic Growth In U.S.

The United States has a vast, and growing, inequality in wealth and income between the rich and the rest of the population. It is now as large as it was right before the Great Depression. Republicans would like you to believe that when the rich do better, everyone benefits (because much of that money trickles down to the rest of the population. But that doesn't work -- it only fattens the bank accounts of the rich, and little to nothing actually trickles down.

But that is not the only problem. This vast inequality is also a drag on the economy -- hurting the nation's economic growth. The Economic Policy Institute has written an excellent article on this, and I recommend you read it. Here is their conclusion:

Since the late 1970s, income inequality has risen sharply enough and been sustained long enough to have significant macroeconomic and fiscal effects. This inequality has led to chronic shortfalls of demand stemming from weakened household spending. These chronic demand shortfalls have constrained economic growth—by as much as 3.4% of GDP per year—and contributed strongly to the very slow recoveries following the most recent three recessions predating the coronavirus recession. The early 1990s recovery was the first one dubbed “jobless,” but employment recovered even more slowly in the early 2000s recovery and the recovery from the Great Recession of 2007–2009 (Bivens 2016).

Even as rising inequality dragged on demand growth and harmed recovery from these three recessions, policy levers meant to help the economy bounce back faster were either becoming less effective (interest rates were near or at zero and couldn’t be lowered further) or were left unused (Congress failed to provide sufficient fiscal stimulus by boosting spending). So far, the recovery from the recession caused by the COVID-19 shock has been happily much more rapid, almost entirely due to the much greater fiscal effort—spending increases—put into recovery. But the fiscal push that aided recovery so far is gone, while almost certainly little progress has been made in lessening inequality. As time marches on, the demand-depressing effect of this higher inequality could start to reassert itself.

In fiscal terms, the key effect of rising inequality has been to redistribute income from the low- and moderate-income households that tend to be net recipients of disposable income from the tax and transfer system toward the higher-income households that tend to be net payers to this system. As income gets transferred from low-savings to high-savings households, where is the increased savings going? A good chunk of it goes to reducing measured budget deficits. As we note in the text box explaining why some measures of aggregate personal savings haven’t risen over recent decades, the reduced budget deficits that accompanied the rise in inequality is in some sense “where” the extra savings one would expect from a rise in inequality have shown up.

There are economic circumstances in which moving closer to federal budget balance might aid economic growth. But the U.S. economy has not enjoyed those circumstances for much of the last four decades. Economic growth has been constrained by weakened demand for sustained periods since 1979, which means that there was no particular economic benefit from lower budget deficits. Essentially, the macroeconomic downside of higher inequality—the drag on economic growth—likely neutralized any fiscal upside.

Income Inequality In The United States

We have heard recently from Republicans that the rich pay too much in taxes while many in the country pay no taxes at all. They want to cut taxes for the rich and raise it for everyone else, including making the poor pay at least some amount.

The chart above shows the income distribution per quintile of the population. Note that the bottom 60% of Americans have only about a quarter of the nation's income (25.9%) -- about equal to that of the top 5% (23%). And the top 20% of Americans get over half of the nation's income (51.4%).

That bottom 60% is struggling to pay their bills and keep up with inflation. It makes no sense to tax them more, and make their lives even harder.

Meanwhile, there are some among the super-rich that pay no income taxes at all, and many others that pay a smaller tax rate than the middle class. This is the group that needs to be taxed more. Those with the most income should bear the largest burden of taxes. That is called progressive taxation, and it's supposed to be the way income is taxed in this country.

Besides, it is not true that many in this country pay no taxes. While the working poor may not have to pay an income tax because they don't make enough to be taxed, everyone in this country pays taxes -- and the poor and working classes pay a much larger percentage of their income in taxes than do the rich. They pay property taxes (even when they rent), sales taxes (the most regressive tax), and fees (just taxes by another name).

The Republicans have made it clear that they only care about the rich. They must be voted out of office, so a fairer tax and economic system can be restored.

Can Biden's Proposed Tax On Super-Rich Pass The Senate?

If there's one thing that is undeniable about our economy, it is that the rich are getting richer while most people are getting poorer -- and those getting poorer are paying a larger share of taxes while the rich, especially the super-rich, are paying less (sometimes nothing). President Biden has proposed a new tax for the super-rich which will help this problem. Could it actually pass in Congress in spite of expected Republican opposition?

Former Labor Secretary Robert Reich thinks it has a possibility of passing Congress. Here is what he has to say about the tax, and why it is needed:

America is on the cusp of the largest inter-generational transfer of wealth in history. As wealthy boomers expire over the next three decades, an estimated $30 trillion will go to their children. Those children will be able to live off of the income these assets generate, and then leave the bulk of them – which in the intervening years will have grown far more valuable – to their own heirs, tax-free. After a few generations of this, almost all of the nation’s wealth will be in the hands of a few thousand family dynasties. 

Unless Joe Biden’s new tax plan is enacted — the odds of which is moving from unlikely to likely. I’ll explain in a moment. 

Dynastic wealth runs counter to the ideal of America as a meritocracy. It makes a mockery of the notions that people earn what they’re worth in the market, and that economic gains should go to those who deserve them. It puts economic power into the hands of a small number of people who have never worked but whose investment decisions have a significant effect on the nation’s future. And it is antithetical to democracy.

We are well on the way. Already six out of the ten wealthiest Americans alive are heirs to prominent fortunes. The Walmart heirs alone have more wealth than the bottom 42 percent of Americans combined. The richest 1 tenth of 1 percent of Americans already owns almost as much wealth as the bottom 90 percent.

The last time America faced anything comparable occurred at the turn of the last century, in the first Gilded Age. Then, President Teddy Roosevelt warned that “a small class of enormously wealthy and economically powerful men, whose chief object is to hold and increase their power,” could destroy American democracy. Roosevelt’s answer was to tax wealth. The estate tax was enacted in 1916 and the capital gains tax in 1922.

Since then, both of Roosevelt’s taxes have been eroded by the moneyed interests. As the rich have accumulated more wealth, they have amassed more political power — which they’ve used to reduce their taxes. By now, the estate tax affects only a handful of super-wealthy families that are busily setting up “dynastic trusts” to circumvent what’s left of it. And the capital gains tax has been defanged by what’s known as the “stepped-up-basis-at-death” loophole. More on this in a moment. 

Last week Joe Biden unveiled two tax proposals that would revive Teddy Roosevelt’s original vision, and could possibly slow or even reverse America’s march toward oligarchy: (1) a minimum income tax that Biden calls a billionaire tax but would in reality apply to households with a net worth of $100 million or more, and (2) a separate tax at death on gains from appreciated assets, even if the assets are not sold. 

The odds are growing that at least one of these proposals will get through the Senate in April or May via “reconciliation” requiring only a bare majority (i.e., all fifty Democratic senators plus the vice president). I’m told Joe Manchin is mostly on board (which means the other Democratic holdout, Kyrsten Sinema, will sign on as well). 

Let me go into a bit of detail on each: 

(1) The minimum tax is a 20 percent levy on households with a net worth of more than $100 million, affecting the top 0.01 percent of earners. It would apply both to taxable earnings and to unrealized capital gains (the increased value of your assets), and would function as a kind of prepayment (analogous to withholding) of taxes that eventually would be owed upon the sale of appreciated assets or death. 

For example, suppose someone named Mark Zuckerberg owns $100 billion of Facebook stock, for which he paid nothing when he founded the company, and has no other taxable income. For the first year under the Biden plan, he’d owe $20 billion in taxes even if he didn’t sell any Facebook shares. The next year, if his stock increased in value, he’d owe another prepayment equal to 20 percent of any increase in value beyond $100 billion. (There are other provisions to prevent the very wealthy from being taxed twice on the same income.)

The Treasury anticipates Biden’s new minimum tax would raise $360 billion in the first 10 years from America’s 20,000 richest households.  

(2) Biden’s second proposal would close the “stepped-up-basis-at death” loophole. Under today’s tax code, you pay capital gains taxes on the increased value of assets when you sell them. But if you pass your assets on to your heirs, they can sell them and not pay a penny of capital gains. In other words, you escape capital gains taxes by dying. They escape it by inheriting your wealth. (I remember years ago arguing that this loophole should be closed with then Treasury Secretary Lloyd Benson, who at one point pounded his fist on the table and exclaimed “death is an involuntary conversion!”)

That’s not all. Under current law, if heirs never sell these assets and they continue to gain value (as they almost certainly will), heirs can borrow against them to pay living expenses and then pass them on to their heirs, who won’t pay capital gains taxes either. Put this together with the unprecedented transfer of generational wealth about to occur, from rich boomer to their millennial children, and America’s oligarchy will become thoroughly entrenched in a small group of people who exercise all the power that comes with great wealth but have never worked a day in their lives. 

Biden proposes simply to repeal the “stepped-up-basis-at-death” loophole. The value of assets would not be “stepped up” to their market value at the time of death. Their increased value would be subject to capital gains taxes as if they’d been sold before death. 

Either of these tax reforms would be significant, and they fit nicely together. But if I were betting, I’d bet on the latter because Second President Manchin has sounded less enthusiastic about the first.

One thing we’ve all learned over the past fourteen months is not to rely on Manchin or on anything he says or commits to, so I’m not holding my breath. But if Manchin gives the green light, and Biden and the Democrats pull this off, it will be an historic rebirth of Teddy Roosevelt’s movement against dynastic wealth — perhaps Biden’s biggest single accomplishment. Taxing big wealth is necessary if we’re ever to get our democracy back and make our economy work for everyone rather than a privileged few. 

23% Of Workers Pay 50% Or More Of Income For Housing

The chart above is from the Pew Research Center. It shows a big (and growing) problem in the United States -- too many Americans have to pay too much of their income for Housing. Nearly a quarter of U. S. families (23%) pay 50% or more of their income for Housing, and another 8% pay more than 40% of their income. That is not sustainable, especially since these people are mainly in the lower income portion of workers. Having to pay so much for housing leaves very little for other necessities (food, clothing, school, etc.). Congress needs to address the shortage of affordable housing in this country.

Trump Did NOT Increase GOP Share Of White Working Class

The charts above are from The Washington Post. 

Much has been made in the media of Donald Trump's supposed appeal to White working class voters. The general opinion expressed is that there was a massive shift of White working class voters from Democrats to Trump in the last election. But that may not be true.

These charts tell a different story. The top chart shows the percentage of Republican voters in the White working class. Note that it rose to 31% in 2012 (when Romney was the GOP candidate), but remained at that level in 2016 and 2020. Trump did not increase the percentage of Republicans who were in the White working class.

The second chart shows the percentage of White working class voters who voted Republican. Note that while it increased slightly from 2012 to 2016 (from 57% to 62%0, it fell in 2020 to 59% (as these workers were actually starting to abandon Trump.

NOTE - For the survey, White working class voters were identified as those without a college degree who were in the bottom half of the household income distribution.

Income Redistribution In U.S. Is From The 90% To The 1%

 

There was a time in this country when rising productivity was shared, benefitting all sectors of the population and creating a vibrant middle class. But about four decades ago, the Republicans gained enough power to change economic policy.

They instituted a policy that favored the rich (and corporations) over everyone else. That policy is generally known as "trickle-down" economics -- since they assured Americans that giving more to the rich would benefit everyone, because much of that money would trickle down to the rest of the society.

Sadly, it didn't work as promised. The money didn't trickle down, but just stayed in the bank accounts of the rich (and much was sent overseas to avoid taxation). The 90% was left to struggle with stagnant wages that didn't keep up with inflation -- and the middle class began to shrink.

The truth is that in a capitalist system (especially a crony capitalism like ours) money doesn't trickle down -- it flows upward. And that is exactly what has been happening. Over the last few decades, money has been flowing from the 90% to the 1% -- about $50 trillion. 

Nick Hanauer and David M. Rolf have written an excellent article on this movement of money to the rich from everyone else. I urge you to read the entire Time Magazine article. Here is just a small part of it:

Like many of the virus’s hardest hit victims, the United States went into the COVID-19 pandemic wracked by preexisting conditions. A fraying public health infrastructure, inadequate medical supplies, an employer-based health insurance system perversely unsuited to the moment—these and other afflictions are surely contributing to the death toll. But in addressing the causes and consequences of this pandemic—and its cruelly uneven impact—the elephant in the room is extreme income inequality.

How big is this elephant? A staggering $50 trillion. That is how much the upward redistribution of income has cost American workers over the past several decades.

This is not some back-of-the-napkin approximation. According to a groundbreaking new working paper by Carter C. Price and Kathryn Edwards of the RAND Corporation, had the more equitable income distributions of the three decades following World War II (1945 through 1974) merely held steady, the aggregate annual income of Americans earning below the 90th percentile would have been $2.5 trillion higher in the year 2018 alone. That is an amount equal to nearly 12 percent of GDP—enough to more than double median income—enough to pay every single working American in the bottom nine deciles an additional $1,144 a month. Every month. Every single year.

Price and Edwards calculate that the cumulative tab for our four-decade-long experiment in radical inequality had grown to over $47 trillion from 1975 through 2018. At a recent pace of about $2.5 trillion a year, that number we estimate crossed the $50 trillion mark by early 2020. That’s $50 trillion that would have gone into the paychecks of working Americans had inequality held constant—$50 trillion that would have built a far larger and more prosperous economy—$50 trillion that would have enabled the vast majority of Americans to enter this pandemic far more healthy, resilient, and financially secure.

As the RAND report [whose research was funded by the Fair Work Center which co-author David Rolf is a board member of] demonstrates, a rising tide most definitely did not lift all boats. It didn’t even lift most of them, as nearly all of the benefits of growth these past 45 years were captured by those at the very top. And as the American economy grows radically unequal it is holding back economic growth itself.

Even inequality is meted out unequally. Low-wage workers and their families, disproportionately people of color, suffer from far higher rates of asthma, hypertension, diabetes, and other COVID-19 comorbidities; yet they are also far less likely to have health insurance, and far more likely to work in “essential” industries with the highest rates of coronavirus exposure and transmission. It is no surprise then, according to the CDC, that COVID-19 inflicts “a disproportionate burden of illness and death among racial and ethnic minority groups.” But imagine how much safer, healthier, and empowered all American workers might be if that $50 trillion had been paid out in wages instead of being funneled into corporate profits and the offshore accounts of the super-rich. Imagine how much richer and more resilient the American people would be. Imagine how many more lives would have been saved had our people been more resilient. . . .

As Price and Edwards explain, from 1947 through 1974, real incomes grew close to the rate of per capita economic growth across all income levels. That means that for three decades, those at the bottom and middle of the distribution saw their incomes grow at about the same rate as those at the top. This was the era in which America built the world’s largest and most prosperous middle class, an era in which inequality between income groups steadily shrank (even as shocking inequalities between the sexes and races largely remained). But around 1975, this extraordinary era of broadly shared prosperity came to an end. Since then, the wealthiest Americans, particularly those in the top 1 percent and 0.1 percent, have managed to capture an ever-larger share of our nation’s economic growth—in fact, almost all of it—their real incomes skyrocketing as the vast majority of Americans saw little if any gains. . . .

On average, extreme inequality is costing the median income full-time worker about $42,000 a year. Adjusted for inflation using the CPI, the numbers are even worse: half of all full-time workers (those at or below the median income of $50,000 a year) now earn less than half what they would have had incomes across the distribution continued to keep pace with economic growth. And that’s per worker, not per household. . . .

There is little evidence that the current administration has any interest in dealing with this crisis. Our hope is that a Biden administration would be historically bold. But make no mistake that both our political and economic systems will collapse absent solutions that scale to the enormous size of the problem. The central goal of our nation’s economic policy must be nothing less than the doubling of median income. We must dramatically narrow inequality between distributions while eliminating racial and gender inequalities within them. This is the standard to which we should hold leaders from both parties. To advocate for anything less would be cowardly or dishonest or both.

Billionaires Say They Are "Victims" - They Are NOT!

Did you get a 25% raise this year? If you make minimum wage, that would be a raise of $3770. If you make about the median wage in this country, that would be in the neighborhood of about $15,000.

I doubt any in the middle or working classes got a 25% raise in 2019. In fact, I'll bet that most American workers didn't even get the $3770 raise to give a minimum wage earner that 25%.

Most Americans, especially the bottom 90%, are just struggling to keep up with inflation. A 25% raise would be a dream come true, but it's really a dream with no chance of coming true with the Republicans in power.

But the super-rich, the people who didn't need to make more than they already do, got a 25% raise in 2019. According to the Bloomberg Billionaires Index, the richest 500 people now have $5.9 trillion -- an increase in 2019 of $1.2 trillion (or about 25%).

Inspire of the richest Americans doing exceptionally well (not just the top 500, but the top 1%), they will tell you that they are the "victims" in our economy. And they whine that Democratic efforts to make them pay their fair share in taxes is an example of that victimhood.

Here's part of how Helaine Olen describes this billionaire victimhood in The Washington Post:

The Great Recession was supposed to embarrass the wealthy into slinking away embarrassed, grateful they didn’t land in jail or worse. “There’s an angry mob with pitchforks assembling, and they want to see some heads on pikes,” Fortune opined in 2009. But as the stock and real estate markets recovered, so did the self-regard of the most moneyed among us. Shame? That was so Dow 7,550. It’s now over 28,000. . . .

Elite gatherings such as the Milken Institute’s Global Conference and the annual World Economic Forum in Davos have become all but encounter sessions for misunderstood multimillionaires and billionaires to agree with each other in the face of calls that they pay their fair share. There’s private equity mogul Leon Cooperman, who actually began to cry on CNBC when complaining about Sen. Elizabeth Warren’s proposed wealth tax on fortunes in excess of $50 million. “I don’t need Elizabeth Warren telling me that I’m a deadbeat and that billionaires are deadbeats,” he said.

The rich victims are all around us. Craig Hall, the real-estate tycoon owner of the now infamous ostentatious Northern California wine cave where Pete Buttigieg held a high-dollar fundraiser? He told the New York Timesabout the criticisms, “It’s just not fair.” Jacqueline Sackler, wife of a Purdue Pharma heir, the company in part responsible for the opioid epidemic that’s taken the lives of hundreds of thousands of Americans? The Wall Street Journal got a hold of an email where she complained what she calls the “situation” is “destroying” the family’s reputation, and “dooms” her children.

And no one is more practiced at the art of billionaire self-pity than our president, Donald Trump. He’s the victim of a Democratic “witch hunt.” Impeachment? “More due process was accorded to those accused in the Salem Witch Trials.” Yet he signed into law a tax plan so favorable to billionaires in general, and real-estate interests in particular, it might as well have been tailored precisely for him.

But according to Republicans, the obscene gains of the wealthy aren’t the problem. In 2012, GOP presidential nominee and multimillionaire Mitt Romney, speaking to a group of big-money donors, referred to 47 percent of Americans who didn’t pay federal taxes and needed government benefits to get by as “takers,” adding, they believe “they are entitled to health care, to food, to housing, to you-name it.” (Entitled to food! Imagine that.)

The Trump administration, which boasts the wealthiest presidential Cabinet ever assembled, has spent almost three years attempting to make it harder for people to receive Medicaid, food assistance and even a free lunch at school. They are aided by self-appointed watchdogs, too, such as Minnesota retiree Rob Undersander, who outed himself as a millionaire so he could publicize the supposedly pressing issue of people who have six- and seven-figure net worth receiving food stamps because their income is below eligibility thresholds. (In fact, survey research shows such households account for about 3 percent of households receiving assistance via the Supplemental Nutrition Assistance Program).

Meantime, of course, the wealthy make out. Studies show, not surprisingly, that their opinions carry much more weight with politicians than those of more ordinary voters. But the claim of victimization is one way they seek to protect themselves from some popular anger and the financial consequences they might otherwise face, ensuring their power, wealth and privilege remains intact while they can continue to promote their self-perceived unique virtue and smarts.

The Lies Conservatives Tell To Preserve Economic Inequality

The United States is still the richest nation on Earth, and one might think that would mean all of its citizens are benefitting from that. Unfortunately, that's not true. It's not true because too much of that wealth and income is in the hands of just a few people.

The sad truth is that, when it comes to the distribution of wealth and income, the United States is one of the most unequal countries in the world. The GINI index is used to show how inequality a country is (o being totally unequal and 100 being exactly equal). The World Bank has the United States listed as the 59 most unequal country (with only 58 out of 158 countries studied being more unequal). Our own CIA has it even worse -- ranking the United States 39th out of 157 countries.

The charts above show why this is happening. The top 1% is taking a much bigger share of total income, while the bottom 50% is taking a much smaller percentage than used to be true (top chart). The bottom chart shows that while incomes have risen for the top 1%, it has remained flat for the bottom 50%. This has resulted in the largest gap in wealth and income since before the Great Depression -- and it continues to grow larger (thanks to GOP policies).

Those policies will remain in place as long as the Republicans hold power. And they use 4 big lies to fool the public into going along with those failed policies. Robert Reich tells us what those 4 big lies are. Here's what he writes:

Even though we’re heading toward levels of inequality not seen since the days of the 19th century robber barons, conservatives keep lying about what’s happening and what to do about it. Here are their four biggest lies about inequality, followed by the truth.

1. The rich and CEOs are America’s job creators, so we dare not tax them. 

The truth is the middle class and poor are the job-creators through their purchases of goods and services. If they don’t have enough purchasing power because they’re not paid enough, companies won’t create more jobs and the economy won’t grow. The giant Trump-Republican tax cut for corporations and the rich hasn’t trickled down to ordinary Americans. It’s just made the rich even richer. 

2. People are paid what they’re worth in the market, so we shouldn’t tamper with pay. 

Wrong. Four decades ago, CEOs of big companies got 30 times the pay of typical workers. Now they get 361 times their workers’ pay. It’s not because they’ve done such a great job, but because they control the compensation committees of their boards. They’re using corporate profits to buy back even more shares of stock so their total compensation rises even more. And, they’re monopolizing the economy at the same time. 

Meanwhile, most American workers earn nearly the same today as they did forty years ago, adjusted for inflation. That’s not because they’re working less hard now, but because they don’t have strong unions bargaining for them, as they did then.

3. Any child can make it in America with enough guts, gumption, and intelligence, so we don’t need to do anything for poor and working-class kids.  

The truth is we already do next to nothing for poor and working class kids. Their schools don’t have enough teachers or staff, their textbooks are outdated, they lack science labs, their school buildings are falling apart. We don’t help with costs of child care. We don’t invest in early childhood education. We spend less educating poor kids than we do educating kids from wealthy families. 

4. Increasing the minimum wage will result in fewer jobs, so we shouldn’t raise it. 

In fact, studies show that in states where the minimum wage has been increased, the number of jobs increases. That’s because minimum-wage workers have more money to spend – resulting in more jobs, and also saving employers money on employee turnover. 

America’s lurch toward widening inequality can be reversed. But doing so will require bold political steps. And the American public must know the facts. 

So don’t listen to the right-wing lies about inequality. Know the truth, and act on it.

Huge Wealth/Income Gap Between Whites & Minorities

I have posted many times about the huge gap in wealth and income between the richest Americans and the rest of America. And it is a big problem, made only worse by the recent tax cuts for the rich passed by the Republicans. It must be rectified.

But that is not the only gap posing a problem for our economy. There is also a significantly large gap in wealth and income between Whites and minorities. The median income for Whites is $61,200 and the mean (average) income is $123,400. For Blacks, the median income is $35,400 and the mean is $54,000. For Hispanics, the median is $38,500 and the mean is $57,300.

The difference between Whites and minorities is even greater when it comes to wealth (see the chart above).

Conservatives don't want to admit it, but we still live in an unfair economy, and it's caused by continuing discrimination against minorities. We have not solved our society's racism, and it continues to affect our economy.

NOTE -- The chart above is from the Federal Reserve Board of Governors. The numbers are from 2016 -- the last year for which numbers are known. They do a survey every three years. I doubt the 2019 numbers will look any different when published.

Exploding The GOP Myths About Taxing The Rich More

The inequality of wealth and income between the rich and the rest of America is vast. It is as big as it was in the 1920's, and it continues to grow.

The reason for this is the economic policy (trickle-down economics) imposed by the Republicans for the last few decades. That policy favors the rich while working against the working and middle classes.

The recent tax cut by Trump and the congressional Republicans just made things worse -- by giving huge new tax cuts to the rich and next to nothing for working Americans. It also radically ballooned the deficit and national debt. Now Republicans want to cut programs that help needy Americans -- a move that will again exacerbate to growing inequality.

Most Americans agree that the rich no longer pay their fair share of taxes, and believe their taxes should be raised. The Republicans have offered 12 reasons why that should not happen. Those are just myths.

Robert Reich, former Labor Secretary, lists these 12 GOP myths, and explodes each of them with the truth. Here is what he says:

Myth 1: A top marginal tax rate applies to all of a rich person’s total income or wealth. 

Wrong. It would only apply to dollars in excess of a certain level. The 70 percent income tax rate proposed by Congresswoman Alexandria Ocasio-Cortez would apply only to dollars in excess of 10 million dollars a year. The 2 percent wealth tax proposed by Elizabeth Warren would apply only to wealth in excess of 50 million dollars. 

Myth 2 : Raising taxes on the rich is a far-left idea.

Baloney. 70 percent of Americans – including 54 percent of Republicans – support raising taxes on families making more than 10 million dollars a year.  And expecting the rich to pay their fair share is a traditional American idea. From 1930 to 1980, the average top marginal income tax rate was  78 percent. From 1951 to 1963 it exceeded 90 percent – again, only on dollars in excess of a very high threshold. Even considering all deductions and tax credits, the very rich paid over half of their top incomes in taxes.  

Myth 3: A wealth tax is unconstitutional.

Rubbish. Most locales already impose an annual wealth tax on the value of peoples’ homes – the main source of household wealth for most people. It’s called the property tax. The rich hold most of their wealth in stocks and bonds, so why should these forms of wealth escape taxation?  Article I Section 8 of the Constitution gives “Congress [the] power to lay and collect taxes.” 

Myth 4: When taxes on the rich are cut, they invest more and everyone benefits, when taxes on the rich are increased, economic growth slows.

Utter baloney. Trickle-down economics is a cruel joke. Donald Trump, George W. Bush, and Ronald Reagan all cut taxes on the rich, and nothing trickled down. There’s no evidence that higher taxes on the rich slows economic growth. To the contrary, when the top marginal tax rate has been high – between 71 to 92 percent – growth has averaged 4 percent a year. But when top rate has been low – between 28 and 39 percent – growth has averaged only 2.1 percent. 

Myth 5: When you cut taxes on corporations, they invest more, and create more jobs. 

Wrong again. After Trump and the Republicans lowered the corporate tax rate in 2018, America’s largest corporations cut more jobs than they created. They used their tax savings largely to increase their stock prices by buying back their own shares of stock – enriching executives and wealthy investors but providing no real benefit to the economy.  

Myth 6: The rich already pay more than their fair share in taxes. 

This is misleading, because it focuses only on income taxes – leaving out the large and growing tax burden on lower-income Americans; payroll taxes, state and local sales taxes, and property taxes take bigger bites out of the pay of lower-income families than higher-income.

Myth 7: The rich shouldn’t be taxed more because they already pay capital gains taxes. 

Misleading. Rich families avoid paying capital gains taxes by passing their wealth on to their heirs. In fact, the largest share of big estates transferred from generation to generation are unrealized capital gains that have never been taxed.

Myth 8: The estate tax is a death tax that hits millions of Americans.

Baloney. The current estate tax, which only applies to assets in excess of 11 million dollars, or 22 million dollars for couples, affects fewer than 2,000 families. 

Myth 9: If taxes are raised on the wealthy, they’ll find ways to evade them. So very little money is going to be raised.

More rubbish. For example, a 2 percent wealth tax, as proposed by Senator Elizabeth Warren, would raise around 2.75 trillion dollars over the next decade with very little tax evasion, according to research. A 70 percent tax on incomes over 10 million would raise close to 720 billion dollars over 10 years. 

Myth 10: The only reason to raise taxes on the wealthy is to collect revenue.

No. Although these proposals would generate lots of revenue – and help us reduce the national debt while investing in schools, roads, and all the things we need – another major purpose is to reduce inequality, and thereby safeguard democracy against oligarchy.

Myth 11: It’s unfair to raise taxes on the wealthy.

Actually, it’s unfair not to raise taxes on the rich.  For the last 40 years, most Americans have seen no growth in their incomes at all, while the incomes of a minority at the top have skyrocketed. We’re rapidly heading toward a society dominated by a handful of super-rich, many of whom have never worked a day in their lives. More than 60 percent of wealth in America is now inherited. 

Myth 12: They earned it. It’s their money.

Hogwash. It’s their country, too. They couldn’t maintain their fortunes without what America provides – national defense, police, laws, courts, political stability, and the Constitution. They couldn’t have got where they are without other things America provides – education, infrastructure, and a nation that respects private property. And to argue it’s “their money” also ignores a lot of other ways America has bestowed advantages on the rich – everything from bailing out Wall Street bankers when they get into trouble, to subsidizing the research of Big Pharma.

So the next time you hear one of these myths, know the truth.