The top 20% of income earners provide 60% of consumer spending; so, much of it does go for new goods and services.
Do You Think The Rich Should Be Taxed More?
- Thread starter PoliTalker
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The top 20% of income earners provide 60% of consumer spending; so, much of it does go for new goods and services.
Irish Exit
Verified User
The I in the consumer spending formula is "Private Investment". The top 20% also own better than 80% of the country's wealth.
Boris The Animal
It's Just Boris!
As they should. The economy is not some "pie" to be carved out. You fucking Liberals want everyone to be exactly equal in every way it's pathetic!
Irish Exit
Verified User
Well I certainly wouldn't want anybody to be equal with you, but I would like people who actually make an effort to improve themselves to find more opportunities for success.
Boris The Animal
It's Just Boris!
But at who's expense? If we followed your Communistic pipedream and soaked the rich for everything they got, there would be zero opportunities in this country.
I don' see an "I" in the "Average annual expenditures by major category of all consumer units and percent changes" tables. Their percent of the country's wealth is not relevant to the original post that suggested spending by upper income groups does not go to buying new products and services when in reality it makes up 60% of such spending.
Wealth gap is greater than during the Gilded Age. The money trickled up for years, now it is a flood. http://money.cnn.com/2017/11/03/news/economy/wealth-gap-america/index.html The top is where all the money went.
Agreed, nobody disputes those trends. But higher taxes do not reduce their before tax income which is how most of the inequality studies measure income and does nothing for those lower income groups. Pretending we reduced inequality by putting higher taxes on the wealthy is terribly misleading and makes it seem we have accomplished something which we did not.
Not looking for a fairer playing field, although that might happen. But looking to fund the government so we can fix the infrastructure , schools and medical care. Ensuring the outrageously wealthy get wealthier and able to pass it along , is a threat to the American system. Teddy Roosevelt made that clear 120 years ago. His predictions have come true. The wealthy are passing wealth and power along through the generations. Wealth=power. The people are losing power. The plutocracy is forming.
What power have the people lost? Politicians and businesses collect their data so they can cater to their every whim. Look at all the companies that recently decided to quit selling guns (or raising the age) and politicians suggesting gun laws because of the emotional response to shootings. It is easier than ever to vote and the people still choose our elected representatives. Government has programs for every possible need and lower income pay almost no taxes. When did the people have more power?
PoliTalker
Diversity Makes Greatness
Hello Flash,
I never heard that before. Sounds kind of fishy to me. Do you have something to back up this claim?
I never heard that before. Sounds kind of fishy to me. Do you have something to back up this claim?
PoliTalker
Diversity Makes Greatness
Hello and goodbye Boris,
What you have said is not true and you tried to mask the falsehood by making it offensive.
You are certainly free to insult anybody you like, one time.
Nobody can be control what another posts.
But we don't have to read it.
Anybody who allows this after you've done it once becomes your enabler.
That is what the Ignore feature is for.
My visits here will be just fine without you.
Goodbye. Have a nice life.
I'll never read another word you post.
Poof!
What you have said is not true and you tried to mask the falsehood by making it offensive.
You are certainly free to insult anybody you like, one time.
Nobody can be control what another posts.
But we don't have to read it.
Anybody who allows this after you've done it once becomes your enabler.
That is what the Ignore feature is for.
My visits here will be just fine without you.
Goodbye. Have a nice life.
I'll never read another word you post.
Poof!
PoliTalker
Diversity Makes Greatness
Hello Flash,
You have no evidence that higher taxes does nothing for lower income groups. Conversely, higher taxes do allow a government to provide assistance programs for lower income groups and public services programs which greatly benefit them.
The rich can afford to pay for higher quality education, but the poor must use public education. It is always the rich who wish to cut education spending. Taxing the rich more could be used to pay for better public education which directly benefits the lower income sector.
If we did not have the large government with all it's programs in place, inequality would be even more extreme than it is now. The poor would be poorer and the rich richer.
You have no evidence that higher taxes does nothing for lower income groups. Conversely, higher taxes do allow a government to provide assistance programs for lower income groups and public services programs which greatly benefit them.
The rich can afford to pay for higher quality education, but the poor must use public education. It is always the rich who wish to cut education spending. Taxing the rich more could be used to pay for better public education which directly benefits the lower income sector.
If we did not have the large government with all it's programs in place, inequality would be even more extreme than it is now. The poor would be poorer and the rich richer.
PoliTalker
Diversity Makes Greatness
Hello Flash,
" It is easier than ever to vote and the people still choose our elected representatives. "
No, that is just not true. Republicans have engaged in well documented voter suppression efforts aimed at the poor and disenfranchised. The district maps are heavily gerrymandered. 'People' in the USA are simply over-worked and under-informed. If most people understood half of what's going on they would be abhorred. They would put an end to it. They would take charge and take hold of their collective power. Big money has a huge bearing on who gets elected and what they can accomplish. The people have more collective power but that power is asleep. Watch out if it ever wakes up.
" It is easier than ever to vote and the people still choose our elected representatives. "
No, that is just not true. Republicans have engaged in well documented voter suppression efforts aimed at the poor and disenfranchised. The district maps are heavily gerrymandered. 'People' in the USA are simply over-worked and under-informed. If most people understood half of what's going on they would be abhorred. They would put an end to it. They would take charge and take hold of their collective power. Big money has a huge bearing on who gets elected and what they can accomplish. The people have more collective power but that power is asleep. Watch out if it ever wakes up.I found it in BLS data. I can't find that particular table right now, but it is cited in the NYT article:
"While the free spending of the affluent may not be of much comfort to people who are out of jobs or out of cash, the rich may contribute disproportionately to the overall economic recovery.
“This group is key because the top 5 percent of income earners accounts for about one-third of spending, and the top 20 percent accounts for close to 60 percent of spending,” said Mark Zandi, chief economist of Moody’s Analytics. “That was key to why we suffered such a bad recession — their spending fell very sharply.”
https://www.nytimes.com/2011/08/04/business/sales-of-luxury-goods-are-recovering-strongly.html?_r=0
PoliTalker
Diversity Makes Greatness
Hello Flash,
While it can be noted that the Benz provides somewhat significant work and equitable distribution of wealth, all those other high end luxury items do not. And it is even disputable how much socio-economic boost the Benz provides, as it is also a high end luxury item many say is not really worth the price in that consumers are paying as much for the name as they are for efficient transportation use of dollars. One could experience a similar transportation experience in a Hyundai for half the price and support just as many workers.
The trick of your source is that it weights luxury spending the same as standard fare spending, but those things do not have the same economic ripple benefit.
The rich are prone to filling their multiple houses with high end art and luxury goods. These items simply do not lead to as much secondary spending by the workers who create them. Fewer workers for each dollar spent on luxury items spend fewer dollars of their own in the economy.
The real lesson to be drawn from this is that the middle and poor would spend much more if they earned more, but they don't so they don't.
The people with the money are the ones spending the money.
Most don't have much money to spend.
That's why investing in businesses by giving them tax breaks does not lead to much more job creation. They already have pretty much all the expansion capital they can use. More fuel does you no good when that tank is already full. What you need is a destination to drive to.
The rich are also not prompted to increase their spending by a proportional amount if they receive a windfall tax cut to the increase of spending that the middle and poor would do if they received pay increases or better jobs. The rich tend to invest more of their income than the poor do.
Increasing the minimum wage would cause other higher wages to increase because the experienced need to be paid more than the minimum. If they were only getting a few dollars more than minimum, and the minimum goes up to match them, then they would also have to be increased, causing more consumer secondary spending and product demand, the real justification for business expansion and more job creation.
While it can be noted that the Benz provides somewhat significant work and equitable distribution of wealth, all those other high end luxury items do not. And it is even disputable how much socio-economic boost the Benz provides, as it is also a high end luxury item many say is not really worth the price in that consumers are paying as much for the name as they are for efficient transportation use of dollars. One could experience a similar transportation experience in a Hyundai for half the price and support just as many workers.
The trick of your source is that it weights luxury spending the same as standard fare spending, but those things do not have the same economic ripple benefit.
The rich are prone to filling their multiple houses with high end art and luxury goods. These items simply do not lead to as much secondary spending by the workers who create them. Fewer workers for each dollar spent on luxury items spend fewer dollars of their own in the economy.
The real lesson to be drawn from this is that the middle and poor would spend much more if they earned more, but they don't so they don't.
The people with the money are the ones spending the money.
Most don't have much money to spend.
That's why investing in businesses by giving them tax breaks does not lead to much more job creation. They already have pretty much all the expansion capital they can use. More fuel does you no good when that tank is already full. What you need is a destination to drive to.
The rich are also not prompted to increase their spending by a proportional amount if they receive a windfall tax cut to the increase of spending that the middle and poor would do if they received pay increases or better jobs. The rich tend to invest more of their income than the poor do.
Increasing the minimum wage would cause other higher wages to increase because the experienced need to be paid more than the minimum. If they were only getting a few dollars more than minimum, and the minimum goes up to match them, then they would also have to be increased, causing more consumer secondary spending and product demand, the real justification for business expansion and more job creation.
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Well, that was the point. Most consumer spending is done by the upper 20% because they have the most money. Reducing their income reduces the amount they can spend on consumer goods and services. I don't think there is any evidence that luxury items do not have as much secondary spending as other items. The workmen who make, sell, and maintain yachts spend their salaries on food, housing, clothing, utilities, and transportation the same as workers who manufacture Ford Fiestas.
As the article explained, the wealthy lost the most in the recession and their spending on luxury items took a big plunge affecting an entire sector of the economy. People still had to spend money on food, housing, and utilities, but not on luxury items which put many out of work. Taking more of their income has a negative effect on consumer spending. Whether they "need" more luxury items is not a decision government should make.
Increasing the income of middle and lower income workers is a separate subject and is not helped by increasing taxes on higher income groups unless their money is redistributed to lower income which is already done through a trillion dollars annually in EITC and and other social welfare programs which only perpetuate the problem and do not provide any long-term solutions. The effort should be on matching employees with jobs with a potential for increased wages and work training.
The college from which I retired is trying to restart its welding program due to increased industrial jobs in the area. The training pays tuition and minimum wage. They cannot fill the class because they can't find enough students who can pass the drug test.
Hello Flash,
" It is easier than ever to vote and the people still choose our elected representatives. "
"Voter suppression efforts" is the key term. They cannot really document suppression occurred. Voter turnout should have declined in states with a voter ID and remained the same in other states; instead, voter turnout increased and decreased in all states regardless of voter ID. But even with those efforts voting is still much easier than in the past. A person can register at any time including by mail, are asked if they want to register when getting a driver's license or government benefits, and do not even have to prove they are American citizens. Early voting (including mail-in ballots) start about two weeks before the election. Some states allow registration and voting on the same day.
This is all considerably easier than past years in which a person might have only Jan-Feb to register and there was no early voting. For years I heard "more people would vote if we only made voting easier" and we continued to make it easier and easier and turnout only declined including Democratic states.
My point was that people have more, not less, power than before. You basically agree because you say they have collective power which is asleep but they could rise up if they "knew" what is going on. I agree Americans are uninformed, but they have no less power and are no more uninformed than ever. I think you are romanticizing some vision of the past (economically and politically). If the people ever "wake up" in your words, I think half would go right and half left but my guess is that you think they would all go left. That sounds like all my college buddies in the sixties talking about "power to the people" and "when the revolution comes."
I do not agree with much of what you say, Flash...
...but this was an extraordinarily excellent post. It was well crafted and well argued.
I enjoyed it.
PoliTalker
Diversity Makes Greatness
Hello Frank,
I'm glad you enjoyed that well written post by Flash.
Hold on to your armchair.
I am producing a worthy response.
I will be posting it soon....
I'm glad you enjoyed that well written post by Flash.
Hold on to your armchair.
I am producing a worthy response.
I will be posting it soon....