Wealth Inequality in America - Is the data correct?

I have watched this video and would like to know if any of you has information that either debunks or verifies this.



Thanks a lot in advance.

Mike

 

The information is correct, but incomplete and misleading. The premise of the video is that Americans should be upset that the mega wealthy are so much more wealthy than they are. The very idea of an "ideal" based on public polling is ridiculous. Hell, lets just write it into a law and take everything in excess of a certain amount and hand it down to the other 99%. That IS socialism.

Another problem with the data is the issue of social mobility, where the US still ranks in the top 5. Social mobility means that people are moving between these groups, so the "1%" is not a static group of people, but rather a dynamic group that constantly includes new members from those in the other 99%.

The data also has issues in that it only compares wealth and earnings of Americans against other Americans. If the video wanted to be truly insightful and inciting, it would compare those values against other countries with our geography and demography. The problem is, no other countries share our demography, so we'll have to go with geography. Anyone want to take a guess at what those charts look like for China? India? Russia? I'd even accept a comparison with Australia, in spite of the fact they have the population of a city in California and the land mass of the US (a bit like Canada).

Last thing, it should be noted that much of the wealth of the top 1% is held abroad, sheltered from US taxes. We live in a global economy, and cash is going to cross borders to the least hostile environment it can find. You would think a fair video would include the complexities involved in the distribution of wealth, instead of just winding people up about how different the world is from what they think it ought to be.

 

Thanks. And yes, I recognize the undertone. Not "Look at your opportunities, so stop whining", but rather "Go get jealous, get angry and start a revolution".

Many of those types of videos do share some true data and then completely fabricate statistics.

So it's good to know that this one for a change is actually accurate.

Mike

 

I've been busy. that is an extremely creative video, plus its vivid.

Pretty astounding facts. Here are some pieces of data that go along with that description. It puts that distribution in an historical perspective. Wealth as spread among Americans has skewed seriously toward the upper upper 1/10th of 1 per cent, the upper 1% and then lastly the upper 10% in the last 3 decades. The wealth distribution inequality factor was last at its extreme just before the GREAT DEPRESSION hit at the end of the 1920's. It reached that similar extreme just before the Great recession hit at the end of 2007.

Now with due respect to what are conservative friend, o-nation said with regard to mobility...when one thinks of unbelievable extraordinary wealth...you might as well go to Bill Gates. he is the wealthiest guy in America. As a kid he came from what would probably be described as a middle class or upper middle class family. Guy was the leader of an incredible company (at least through say around 2000) and he is one sunofagun hugely wealthy guy. You could describe that as an example of mobility.

But the overall mobility stats suggest that mobility upward is more difficult, less productive than it was a while ago. Here are some more stats: http://milescorak.com/2012/03/04/ov...first-year-of-the-recovery-went-to-the-top-1/

Its fairly current research. 93% of the income gains in the first year of recovery went to 1% of the population. Wow. All of that suggests while mobility is there, of course...its less available in a general sense than in the past.

I'm sort of stunned by the comment about so much "wealth" being invested overseas. Yeah? how much? why is there and not in the US? If that is so it suggests an amazing hole in the long held claim of the right that suggests...give tax breaks to the wealthy because they are the job providers.

Cr@p, if you wanna suggest that is good for the economy you must be implying its good for the economies of China, Bahrain, and all over the rest of the world and hence bad for the US because folks are moving their potential investment monies overseas. That can't be good for opening wealth opportunities for Americans.

Its a vivid video...I'll say that.

 

Scratching my head trying to figure out what a one year stat about investment profits says about social mobility in America, if anything at all. Help me out here.

Vivid. One of the few positive adjectives one can accurately use here. Good choice. I'll stick with misleading.

One of the premises of the video was redistribution of wealth based on public polling data. It got me thinking. We should do some public polling on what the pay tables for Las Vegas slots should be and make a video about it, and contrast that with reality. While we are at it, we should do some public polling on how long it should take the earth to rotate around the sun, or what an average human life expectancy should be. Equally productive, IMO.

 

If there is one thing democrats and republicans should agree on, it is the corporate tax rate in the US. At the highest in the world, how can we expect America to be competitive? To get back the manufacturing jobs and create a more business friendly environment we need to lower the rate. Instead, Obama has been focused on increasing taxes and banning weapons. From what I have read even Obama agrees to lowering the corporate rate.

What I really want is for you to explain to me you believe the current system is unfair. We live in a free country where you are free to become a doctor, found Microsoft, work as a janitor, or not work at all. There are no laws or systems in place that hold down anyone from achieving whatever they want in life. In fact there are systems and laws that help people achieve success. The only limiting factor to an individuals success is themselves (maybe some bad luck too). If you truly believe wealth inequality is a problem, how do you suggest we fix it fairly?

 

Are you aware that you pay tax on profit? People don´t stop doing business just because the tax that they should pay on the profit is high. The tax rate can be what ever you want but in reality nobody pays those rates. There are structural and fundamental problems in the American economy which got nothing to do with corporate tax rate. Just to show you how wrong you are, let's look at top 10 American companies and the tax that they paid.

#1 EXXON MOBIL (XOM)

Pre-tax earnings: $73.3 Billion
Tax Provision: $31.1 Billion (42%)
Actual Taxes Paid to U.S. federal government: $1.5 billion (2%)
#2 CHEVRON (CVX)
Pre-tax earnings: $47.6 Billion
Tax Provision: $20.6 Billion (43%)
Actual Taxes Paid to U.S. federal government: $1.9 Billion (4%)
#3 APPLE (AAPL)
Pre-tax earnings: $34.2 Billion
Tax Provision: $8.3 Billion (24%)
Actual Taxes Paid to U.S. federal government: $3.9 Billion (11%)
#4 MICROSOFT (MSFT)
Pre-tax earnings: $28.1 Billion
Tax Provision: $4.9 Billion (18%)
Actual Taxes Paid to U.S. federal government: $3.1 Billion (11%)
#5 JPMORGAN CHASE & CO (JPM)

Pre-tax earnings: $26.7 Billion
Tax Provision: $7.8 Billion (29%)
Actual Taxes Paid to U.S. federal government: $3.7 Billion (14%)
#6 WAL-MART (WMT)
Pre-tax earnings: $24.4 Billion
Tax Provision: $7.9 Billion (33%)
Actual Taxes Paid to U.S. federal government: $4.6 Billion (19%)
#7 WELLS FARGO & CO (WFC)

Pre-tax earnings: $23.7 Billion
Tax Provision: $7.4 Billion (31%)
Actual Taxes Paid to U.S. federal government: $3.4 Billion (14%)
#8 CONOCOPHILLIPS (COP)

Pre-tax earnings: $23.0 Billion
Tax Provision: $10.5 Billion (46%)
Actual Taxes Paid to U.S. federal government: $1.9 Billion (8%)
#9 INTERNATIONAL BUSINESS MACHINES (IBM)

Pre-tax earnings: $21.0 Billion
Tax Provision: $5.1 Billion (25%)
Actual Taxes Paid to U.S. federal government: $0.268 Billion (1%)
#10 GENERAL ELECTRIC (GE)

Pre-tax earnings: $20.1 Billion
Tax Provision: $5.7 Billion (29%)
Actual Taxes Paid to U.S. federal government: $1.0 Billion (5%)
The real solution to the American economy problem is exactly opposite to what is being done. The solution is to lower the tax on low incomes, rebate on social security costs for new employees and removing taxes on expenditures so people and small and medium size companies have the possibility to spend while compensating by real taxation on profits and high incomes. If you give a $1,000,000 tax rebate to one rich person, it will not do anything to stimulation of demand. This person most likely won't buy another car, go more out to restaurants,visit amusement parks or even go the a hair dresser while if you give the same rebate to $10,000 people, the $100 extra will stimulate the economy by all the small business that will sell more products and services which in turn generates more profit for businesses and more tax for the government.

 

GWorld, you amaze me. You have all the facts at your fingertips but still manage to come to the wrong conclusions. Let me point them out:
1) The fact these companies pay little or no taxes indicates problems with the tax code, not structural problems with the economy, outside of the fact the lost tax revenues hurt our economy.

2) One of the problems with the tax code is that our corporate income tax rate is too high. Small businesses cannot afford to pay for the tax avoidance schemes used by medium to large sized businesses, which means the government is effectively stifling small business, competition, and innovation, to the favor of large businesses who have the lobbyists and the means to avoid those taxes. Some companies, like GE, brazenly avoid taxes while their executives serve as paid appointees for the Obama White house as "Jobs councilors". Oh the dark humor and irony of that. Our high tax code is used as a weapon by large businesses against small ones.

3) While you are right that money in the hands of billions of low income earners does much more to stimulate an economy than new tax breaks for the rich, you completely miss the point that, on a personal level, our tax code is already as progressive as it gets, with the working poor actually paying nothing and receiving a tax rebate. 47% of our working population pays no taxes whatsoever. The only way to directly put more money in these people's hands is to cut them a (bigger) check. Socialism.


At least you did a good job of identifying the problems, even if your solutions suck. Here are a few ideas that would actually have a shot at working.

1) Fire the people in charge. Start with Obama and his cabinet, continue down the chain to include those who currently manage our oversight organizations, such as the SEC and FTC. These people are actively subordinating the megalith multi-nationals that are too big to fail in our country.

2) Break up the megaliths. Bank of America, Wells Fargo, AT&T, etc. You would be amazed at the innovation and growth in the economy.

3) Reform the tax code. Lower the corporate tax rate, or at least make it progressive like the personal income tax rate is. Close loopholes that allow pension fund managers to earn commissions at the capital gains rate, or shelter income earned abroad in offshore accounts. Lower the personal income tax rate, and raise the bottom tax rate so that everybody who works pays something, even if it is only a dollar.

The only structural problem with our economy is deep seated corruption in our politics, and it isn't married to any political party.

 

Amazing..


http://abcnews.go.com/blogs/politic...biden-trip-to-london-paris-totaled-1-million/

 

This never worries me. Political leaders need to represent and what is one million compared to the numbers we have seen dealt with in this thread?

Would you prefer he stays in a youth hostel or goes to couchsurfing.com?

 

The problem is, everything these guys do is "official business", and what isn't "official business" gets picked up by business people. 500k dinners, million dollar overnight stays. Against the backdrop of trillion dollar deficits, these are really small numbers, but any person who has ever managed a budget knows a lot of small numbers add up to very big numbers.

Everyone wants to attack medicare or Social Security, which deal with nothing but big numbers at face value. It may need doing, but I would be much happier if our leaders found a way to deal with this kind of crap.

In other news, one has to like this, especially against the backdrop of the theft going on in Cyprus: