TODAY'S TOPICS: Wealth Disparity, Graphs!, Cain's 9-9-9 Plan, Hedges, Olbermann, Daily Show, The Banks
Wealth Disparity…and Graphs!
I really want to keep hammering away at our oligarchic
economic system and our rapid descent into Banana Republic land. This time
however, I come with a host of graphs (due to popular demand), most that illustrate
points I made in my last post, but stand on their own.
There really is no bigger issue than the widening gap between
the super rich and everyone else because no other factor is more important in
determining what constitutes a democracy. You simply can’t have a democracy
when the gap in both wealth, influence and power between people...and
between corporations and people...as we have today…and its only getting worse…every year.
So, let me stay on this point…and then add in another
critical component: the power and influence of the banking industry…and how the
financialization of our economy is so integral to our nation’s 3 decade long
collapse that has led to the door of a kind of pseudo fascist, feudal like state…or
at least we’re headed there (obviously our own version…we still have a lot of
wealth and credit…and a pop culture that keeps us distracted and amused…but the
numbers and the signs tell a different story).
Before the graphs, a few more factoids to drive my point
home…then let me get to the Herman Cain and Rick Perry plans…the EPITOME of our
descent into a corporate/fascist state…the plans are so insane they’re almost
comical:
- An economic snapshot from the Economic Policy Institute shows that inflation-adjusted incomes of the top 1% of households increased 224% from 1979 to 2007, while incomes for the bottom 90% grew just 5% in the same time period. Those in the top 0.1% of income fared even better, with incomes growing 390% over that time period.
- The average tax rate for the top 1% of households has fallen since 1979, even as their incomes rose. High-income households paid a tax rate of about 37% in 1979 and about 29.5% in 2007.
- The National Priorities Project, in partnership with Citizens for Tax Justice, has released a new site tracking the ever-growing cost of the Bush tax cuts. They found that the tax cuts for only the richest 5 percent of Americans “cost the U.S. Treasury $11.6 million every hour of every day.”
- About 25 percent of millionaires in the U.S. pay federal taxes at lower effective rates than a significant portion of middle-income taxpayers, according to a legislative analysis.
- Preferential treatment of investment income and the reduced impact of payroll taxes on high earners lets about 94,500 millionaires pay taxes at a lower rate than 10.4 million “moderate-income taxpayers,” representing about 10 percent of those making less than $100,000 a year, according to the report by the non-partisan Congressional Research Service dated Oct. 7.
- The richest 400 Americans have more wealth than the bottom 150 million combined and globally 1% of the world's population has more wealth than the bottom 40%.
- In the Bush expansion from 2002 to 2007, 65 percent of economic gains went to the richest 1 percent.
- In 1981, the average salary in the securities industry in New York City was twice the average in other private sector jobs. At last count, in 2010, it was 5.5 times as much. (In case you want to gnash your teeth, the average is now $361,330.)
- Of the 100 highest-paid chief executives in the United States in 2010, 25 took home more pay than their company paid in federal corporate income taxes, according to the Institute for Policy Studies.
Now some graphs...the ones that are too small just click on them and click on Ctrl and then start pressing the "+" key and it will get bigger...unfortunately if I make some of them bigger on this screen the resolution gets too poor to read them...not sure why the quality isn't that great, but I took them right off these websites:
Bank Facts: Bailouts, Crimes, and Protests
There factoids were compiled by the Center for American
Progress…and should, combined with the data on wealth disparity (and poverty,
foreclosure rates, childhood hunger, the uninsured, etc.), once again answer
the question as to why people are protesting in the streets across the country
and world. Similarly, these facts illustrate why I said 3 absolutely CRITICAL reforms that must be a part of any demands are breaking up the biggest banks, restoring Glass Steagall, and instituting a financial transaction tax:
– Bank profits are highest since before the recession…:
According to the Federal Deposit Insurance Corp., bank profits in the first
quarter of this year were “the best for the industry since the $36.8 billion earned in
the second quarter of 2007.” JP Morgan Chase is currently pulling in record profits.
– …even as the banks plan thousands of layoffs: Banks,
including Bank of America, Barclays, Goldman Sachs, and Credit Suisse, they’re planning to lay off tens of
thousands of workers.
– Banks make nearly one-third of total corporate profits:
The financial sector accounts for about 30 percent of total corporate profits, which is
actually downfrom before the financial crisis, when they made closer to 40 percent.
– Since 2008, the biggest banks have gotten bigger: Due to
the failure of small competitors and mergers facilitated during the 2008
crisis, the nation’s biggest banks — including Bank of America, JP Morgan
Chase, and Wells Fargo — are now bigger than they were pre-recession. Pre-crisis, the four biggest
banks held 32 percent of total deposits; now they hold nearly 40 percent.
– The four biggest banks issue 50 percent of mortgages and
66 percent of credit cards: Bank of America, JP Morgan Chase, Wells Fargo and
Citigroup issue one out of every two mortgages and nearly two out of
every three credit cards in America.
– The 10 biggest banks hold 60 percent of bank assets: In
the 1980s, the 10 biggest banks controlled 22 percent of total bank assets.
Today, they control 60 percent.
– The six biggest banks hold assets equal to 63 percent of
the country’s GDP: In 1995, the six biggest banks in the country held assets
equal to about 17 percent of the country’s Gross Domestic Product. Now their
assets equal 63 percent of GDP.
– The five biggest banks hold 95 percent of derivatives:
Nearly the entire market in derivatives — the credit instruments that helped
blow up some of the nation’s biggest banks as well as mega-insurer AIG — is dominated by just five firms: JP Morgan Chase, Goldman
Sachs, Bank of America, Citibank, and Wells Fargo.
– Banks cost households nearly $20 trillion in wealth:
Almost $20 trillion in wealth was destroyed by the Great
Recession, and total family wealth is still down “$12.8 trillion (in 2011 dollars) from June 2007 — its last
peak.”
– Big banks don’t lend to small businesses: The New Rules
Project notes that the country’s 20 biggest banks “devote only 18 percent of their commercial loan portfolios
to small business.”
– Big banks paid 5,000 bonuses of at least $1 million in
2008: According to the New York Attorney General’s office, “nine of the
financial firms that were among the largest recipients of federal bailout money
paid about 5,000 of their traders and bankers bonuses of more than $1 million apiece for 2008.”
Herman Cain’s 9-9-9…and the Flat Tax
The Tax Policy Center put
out a distributional analysis of Herman Cain’s 9-9-9 plan, and it would
raise taxes for 84% of the population, cost those in the lowest quintile 20% of
their income, and save millionaires something close to $300,000 a year.
As Howard
Gleckman notes, "under Cain’s plan, multi-millionaires making over $2.7
million a year would pay a smaller share of income in federal taxes than
someone making $18,000.
According to a new analysis by Citizens for Tax Justice, if
999 was in effect today, “the richest one percent of taxpayers would each pay $210,000 less in annual
taxes on average, while the poorest 60 percent of taxpayers would each pay
about $2,000 more in annual taxes on average, than they do now.”
As David Dayen notes, “The first thing to say is that this
is the logical outcome of any flat tax. Right now our system is progressive at
the federal level, and flattening it out will invariably mean that the poor pay
more and the rich pay less. Flat taxers often make their appeal on the basis of
fairness, but it’s a completely unfair plan relative to current law.
The second thing to say is that this is the goal of all
Republican tax policy. There’s a flat-taxer in every single Republican
Presidential primary, from Kemp to Forbes to Huckabee to Cain. They may always
lose; the other candidates last night jumped
all over Cain, with Santorum actually using the TPC numbers.”
In fact, as Kleinbard shows, Cain's plan doesn't replace the
payroll tax — it is a payroll tax, or more precisely a wage tax, amounting to
the equivalent of about 27% on wage income. Wage earners would pay 9% income
tax and 9% sales tax on income from first dollar to last. Because their
employers would lose the existing tax deduction for their wages, in economic
terms that would amount to an effective additional 9% tax on the worker.
Kleinbard estimates that 9-9-9 would cut the after-tax disposable income of a family with gross wage income of $120,000 by $541 compared with current law; a family with $50,000 in wages would be poorer by $4,848. On the other hand, entrepreneurs and other business owners would have a convenient option to cut their own tax bill, simply by paying themselves not in wages but in dividends, which would be tax-exempt.
Kleinbard estimates that 9-9-9 would cut the after-tax disposable income of a family with gross wage income of $120,000 by $541 compared with current law; a family with $50,000 in wages would be poorer by $4,848. On the other hand, entrepreneurs and other business owners would have a convenient option to cut their own tax bill, simply by paying themselves not in wages but in dividends, which would be tax-exempt.
I’ll get to Perry’s tax plan next post…
Here's the greatest graph of all time...Herman Cain's plan in a nutshell...
Media Coverage of Candidates…and the Top 5 Lobbyists
Before I deal another death blow to the BIG LIE that the media is
liberal…consider who’s on the list of the top five lobbyists in Washington.
Here's what
the Center for Responsive Politics is reporting so far in 2011:
1. U.S. Chamber of Commerce — $31.8 million
2. General Electric — $15.4 million
3. AT&T Inc. — $11.7 million
4. Blue Cross/Blue Shield — $11.1 million
5. Comcast Corporation — $10.7 million
2. General Electric — $15.4 million
3. AT&T Inc. — $11.7 million
4. Blue Cross/Blue Shield — $11.1 million
5. Comcast Corporation — $10.7 million
Nice to know the telecom/media conglomerates are so liberal
no?
Well, take a look at this graph…and notice the kind of
coverage President Obama gets versus the Republican challengers:
VIDEO SECTION
Classic…from C&L: After some obnoxious partisan clips
from Fox News of early reaction to the capture and subsequent death of Libyan
dictator Muammar Gaddafi, Jon Stewart asked “Is there no Republican that can be
gracious and statesmen-like in this situation?"
Scum bag “democrats” and “independent” Ben Nelson (Neb.),
Mark Pryor (Ark.) and Joe Lieberman (Conn.) helped the GOP block the passage of
a portion of President Obama's jobs bill…CRITICAL funding that would have
helped hire new teachers and cops…Maddow goes after them:
Jon Stewart: GOP 'Loves' America But 'Hates' Most Of Its
People
The great Bernie Sanders urging the President to keep
fighting for jobs…and use the Occupy Wall St movement to that end…better, this
is on Olbermann’s show:
And, my current favorite comic (as in comic who’s alive…Hicks
then Carlin are still my favorites), Jamie Kilstein, also visits Olbermann…who’s
clearly MORE free to do what he wants, and get even more subversive, now that
he’s free of network news:
I thought this was touching…Chris Hedges is taped by Occupy
Wall Street protesters share some of his thoughts. As I have mentioned before,
I think he’s an astonishingly good writer, and I agree with so much of what he
says, but I think he goes a little over the top in his constant attacks on “liberals”
and groups like Moveon. Here he even calls Moveon “reprehensible”. Yes,
mainstream liberal “elites” and groups like Moveon have been too in the pocket
of the Democratic establishment, have failed to see the kind of fight that was
needed, and have been too concerned with electoral, rather than movement
politics…but they’ve done a lot of good too…and while I have problems with them
and their failings…reprehensible is a strong word…I think a lot of people
there, some who I have met, are trying to do good and what’s right…but the
Matrix has a way of neutering people and even thought.
At any rate, this is a great interview:
Rugged individualism….except when it comes to taxing rich
and class distinction…this is an excellent clip of one of my FAVORITE new
writers, Joshua Holland, and radio host Mike Papantonio:
And check out the marine sergeant that went down to protect
protesters from cops…powerful stuff:
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