good point

By far, most of that is in stock options, however.

With the option price set so generously that you can still tank your company and make money at the same time!

And while I believe about 50% of compensation is stock options, I don't think that's true for their "golden parachute."

With the really extravagent compensation you read (like Larry Ellison's $580 Million+), it's 99% stock options.

And usually the golden parachute is to buy a CEO out of his contract and get him out of there, so obviously they don't want them to be having a bunch of company stock. Though, actually stock options may indeed be a part of a golden parachute. Interestingly enough, the golden parachute took off during the 1980s, in response to a bevy of takeover and mergers, as golden parachutes tend to be views as semi-poison pills to those contemplating hostile takeovers.

If you don't like how a company is run and how well their CEO is compensated, don't buy stock in them. It's the easiest way to avoid any moral conflict you have.

I personally think capital gains should be taxes at the same rates income is. This change would lower overall income levels. It's absurd to me that we treat different ways of making income differently on the tax code. Income is income, doesn't matter how it's acquired. This would also stop douchebags from padding their salaries with stock options that is nothing more than a tax loophole.

Or I can talk to my Congressional representative and ask them to improve the laws governing corporations. Corporations are not natural entities, they exist because we as a society and a government have chosen to create them. Whether or not I invest in a corporation, we all have a stake in their creation and the regulations that govern them.

That is fine. But I do think it's dangerous to request your government demand to put restrictions on what a company can pay it's employees.

I believe there are many cross-company relationships like this, but how is that overly relevant to anything?

BoD's vary by industry. Not everybody is even qualified to sit on one of these, and of those that are, certainly not all wish to be a part of them. They are additive to an already busy workload. They tend to be serious people in their industries and people who actually attend every conference and every charity and every "thing" in their industry because ....they are important people and/or experts at something. Is there an element of collusion? Probably to a degree...but (the majority of) these types of people are lifelong industry veterans.

But at the end of the day...they work for profit-seeking companies that have shareholders who have differing levels of tolerance for the lack of profit. That means somebody (or somebodies in most cases) have volunteered their own acquired wealth to invest in this arrangement. They didn't invest their money because "Joey works in IT and he is one helluva Unix problem solver"...they vote based on pedigree of the execs involved. Successful people have track records which garner interest...when they f-up and loot the company...well, they certainly don't get a long line of investors next time...but they also have the side effect of making investors more cautious in the future. Not too much different than a Madoff really.

It tends to work itself out...but let's not kid ourselves. If they enacted a law tomorrow that said CEO's must not make in excess of 20x the lowest paid employee in their company then they would fire everybody non-management and contract the rest. It doesn't matter what you think should be fair in this world...rich people will not play a game if it means they are certain to lose.

The one thing I will say about CEOs. When does it turn into embezzelment? I mean if you have a bank that goes insolvent yet you take hundreds of millions in bonuses, how is that not embezzlement?

There's more millionares in the U.S. than any other country (by far), and about 40 of the top 100 richest people in the World are in the U.S. Why is that a bad thing? They sure provide a lot of tax revenue.

If a bunch of those rich people died tomorrow and left all their money to a foreign trust or something, we'd look a whole lot "better" on that chart. Would that be an improvement to our country?

And the modest tax increases that people always propose when this stuff comes up wouldn't make a dent in that disparity. I don't think a lot of you are saying what you REALLY want.

I mean, is the problem the disparity, that the rich have too much, or the poor don't have enough? When people focus on the first two, it just sounds like jelousy and bitterness.

Rich people rule the world??? When did this happen??? Well Obama can change that!!! Oh wait, he's super rich too? Never mind.

Well, he did tell us that we should vote for him because he had fewer houses than McCain.

Oh noes! Switzerland must be a capitalist hellhole where the ordinary people have to scrounge around for bread while the rich sit in their castles and laugh!

What's funny is that my guess is most of us are in the same boat on this board... $50K - $150K range. We sit around and listen to rich people from both parties convince us how to spend our tax money on either the millionaires or the poor and argue with each other about which is the better approach instead of getting together and collectively telling both parties to fuck off.

Am I a big fan of CEO's making more money through government created tax loopholes? No. Do I want to give my money to a lazy motherfucker who chooses not to work and have kids? No. Why do I have to be one or the other?

Good point. The middle class is usually completely forgotten in these debates. And they're (we're) the ones that stand to lose the most when government gets stupid.

Corporations, sure, to some extent. Of course, we need corporations for jobs. Not sure how hard we want to go after them for wealth redistribution.

Personal income - I always hear vague talk about "tax shelters and loopholes" - yet the top 1% of american households pays 40% of the taxes. And the top 5% pays 60% of the taxes.

I'm not seeing the gross injustice there. Should the top 5% just pay for everything? Will we feel better pychologically or something if we bring them down?

Tax Burden of the Wealthy Continues to Grow in 2006 According to Joint Economic Committee of Congress

Actually, as they tend to understand the system, want ordinary people to make money to be able to buy their goods, as Henry Ford understood.

Yay! Let's hear it for wacked out positions which won't get put into policy (especially not in the next 8 years).

So what's the goal - to bring up the poor to be equal the middle class?

Let's say we accomplish that. Then you have no more middle class, just a (bigger group) of poor, and the super rich. There's quite a few countries like that on the globe.

It sounds fair to me too. But you're apparently on a more rabid "rich is evil" thing and want MORE. How much more? 100%? Or are you content with what they're paying now - it doesn't seem that way. What's your ideal income tax rate?

There's an enormous number of millionares in this country. They pay for pretty much the entire government. We can make them pay more, of course. But these people invest, buy shit, hire people, develop ideas and product, produce world-class art, teach others, donate to charity, are often world leaders in their fields of expertise, etc. They do a lot of good. Any country would benefit from such a pool of talent. At some level, you have to let them do their thing and not entirely just think of them as "the enemy".

The rich don't pay 40% or 60% or whatever of taxes. They pay that share of federal income taxes which are the largest share of taxes, but by no means are they the entire tax burden. When you look at the total tax burden the rich are paying a near historic low percentage of their income.

Equating the income tax with taxes seriously skews reality.

If you do the math out in Steve's chart the top 20% still pay in that range (a little over 50%).

If this is too low, how do we take more? What's the magic number? Or will the answer to that always just be "more", no matter what it is?

Someone said they wanted the Clinton-era rates but 2% higher on the top incomes. We'll get that under Obama and this Congress, won't we? Everything will be fine then, right?

I'm not sure I get this chart...so the top 20% of earners in this country "average" $116k/yr? I must not be reading this correctly because there is no way I believe I am near the top 20% of earners in this country...no way. What year is this from?

Of course...this (and the previous chart) don't show anything in the way of the taxes they pay on property (cuz they certainly have fancier homes and more of it in general), sales tax (cuz they certainly spend more), and also doesn't count the amount of money given away to charity due to it being tax deductable. All of these are tax burdens as well...which makes the disparity of % of income so much more difficult to quantify...but it certainly doesn't put the wealthy's % lower when factored in.

It almost works out to a flat tax, which is the fairest thing to do anyway, IMO, so I'm glad to see that.

The greater % of wealth the rich control, the greater % of the government they'll be responsible for.

Poor people are typically poor for a reason. Propping them up does nothing to help advance society.

No way charitable contributions can be considered a part of the tax burden.

Sales taxes are generally seen as regressive because they take a higher percentage of income from lower income workers.

But in general, I'm very much in favor of discussing the overall tax burden when we talk about taxes rather than just the income tax.

That's my biggest problem with a flat income tax. We're already close to a flat tax if you look at the total tax burden so a flat income tax would mean a regressive total tax burden.

On the college part...this is another nice by-product of government intervention once again. Grants & loans have driven these costs up over the years. So instead of being "only the wealthy can afford college" now we're at "only the wealthy can afford college without a loan"...well, which do we prefer? Rinse & repeat on housing and the automobile industry. Automobiles should not cost $30k +...but of course they do because we always need to finance anybody...or we need to keep paying out increased benefits to unions...or whatever the reason of the day. It still does not have the net effect of reducing income disparity and I believe you can very easily argue that government has helped to increase it by sticking its collective nose into these markets where only the "rich" could have ever afforded to benefit long term. But...poor people benefited short term...so there you go. Short term comfort for longer term disparity...and we never learn, do we?

As I said...you can make all the financial assistance available, make new rules, laws, and the like to try and pry more money away from those who have it...but you cannot force them to play in a system that they do not percieve winning (or profiting) to be an option.

No, not part of their tax burden...but the fact that they tend to give much larger donations due to it being a tax writeoff(or did this change recently?). It benefits society in a more direct (and IMO) and efficient way than sloshing through the various government rep's agendas.

But there's no reason to believe they won't play if they are still winning but with slightly lower margins. The environment for the wealthy is about as favorable as it's been over the past one hundred years. There's no reason to think that we can't go back to the Clinton rates and still be prosperous.

I don't know how much difference returning to the Clinton rates will make when you're dealing with $9 trillion in federal debt. If we're just inventing money anyway, why are we so concerned about tax revenue? if debt's no problem, why not let the corporations and rich people even more off the tax hook so we can help unemployment?

And yes, there's no reason to believe "they won't play if they are still winning but with slightly lower margins." People will still try to do well (unless things got extreme and we wiped out the middle class to bring up the poor). It's just a matter of a dollar in a successful person's hands v. a dollar in the government's hands, and where exactly society as a whole benefits more from the former.

But we've been marginally raising taxes on the wealthy since the Clinton years...it's just not as obvious as an actual "income" tax appears.

http://www.house.gov/jec/news/2008/July/pr110-45.pdf

I'm sure this will be discredited as Republican spin or similar but...



Now...if you don't dismiss this data as somehow being spin...how does the highest tax brackets manage to earn more disproportionately while the income tax rate is higher on them? And conversely...after the Bush tax cuts they also managed to pay in a higher % than they had in 20 years.

Now...there are certainly many dynamics to the Clinton era and the Bush era which I think one can (rightfully) debate as being different and incomparable. But I don't see how taking more money from rich people ends up as a net benefit to the rest of us who fall in the middle class who play by the rules and try to earn a decent living.

Most of us work for rich people who decided to invest their money on a hunch that they could make more money. This is the typical story of wealth. If you take more of it away...then we merely pay more bureaucrats (of questionable skillsets) deciding how best to spend rich people's money. If you let rich people hold onto more of their money, they tend to try and find ways to make more of it. Sometimes they succeed wildy! Sometimes they fail miserably. In either case they have employed people, bought stuff, and contributed more to the economy than the bureaucrat.

Dola,

sorry about the formatting...it got stuck in the article font and I'm too stupid (lazy?) to figure out how to change it.

I don't really care how much of the federal income tax is paid by any particular group as I don't think that necessarily tells me anything. I'm more concerned about the percentage of income being paid in taxes for various groups, and as I've said the wealthy are currently paying near historic lows. There just isn't any evidence that the wealthy are currently overtaxed.

I don't know who you keep arguing with about the deficit, but play on playa.

I don't know the exact amount, but I'm pretty sure a return to the Clinton rates would mean a ten year increase in revenue of multiple trillion dollars. It would make quite a bit of difference.

Nice - so Bobby Jindal was using a government helicopter to travel around and speechify at Louisiana churches...to the tune of $45,000. Whoops!! Government waste? Separation of church and state? Which is it?

Well done Bobby.

FWIW

in the medical and insurance industry, self regulation is not an option. I know that the right, in the health care debate, isnt arguing against this but I thought it important to reiterate considering the felony guilty plea by Pfizer.

Pfizer whistleblower's ordeal reaps big rewards - Yahoo! Finance

From the man who always cries strawman comes Logic 101's Hasty Generalization.

One-thousandth of a point over what anybody else is paying is "overtaxed" afaic.

actually I think Ive used the term 'strawman' in calling out an argument once with MBBF about 10 pages back....maybe youre confusing me with someone else.

Its not really a card I use.

Ive also pointed out in so many threads that the corporate malfeasance in a drive to increase share price and profit is pretty broadly spread. The leukemia case in California most recently where the girl died just hours after the insurance company coalesced to approve the treatment.

But the concentration of that wealth occurred during the Clinton years...according to that document.

So, should we surmise that raising income tax rates on the wealthy leads to further concentration of wealth?

I'm not sure you can make that comparison without considering there are many dynamics to this...but if your numbers are accurate, and can be evenly compared to a US university (i.e. not a CC)...I'm inclined to believe they have socialized this just like they have socialized everything else. And socializing something means that nearly EVERYBODY should partake in its use or it becomes inequal in it's burden. So, police, fire, roads, military, basic government, etc. are all used by everybody that wishes to participate in society with only minor exceptions to this.

They have insisted that everybody (regardless of life goals, skills, etc.) must pay into a system which allows everybody to become a doctor or lawyer. The problem is that not everybody needs to be highly educated to contribute to society. So while its great that they might have some wonderfully educated trash removal personnel...it isn't necessary and it is wasteful for the rest of society to pay for (i.e. the rest will pay for it if taxation is progressive not the trash removal person...if taxation is non-progressive the trash removal person is paying for something that has no real world value to them).

So yeah...if everybody in the US went to college I'm sure we could leverage the economy of scale better. But again...because you chose a certain lifestyle and believe it to be the best path for you, why should everybody else pay into a system when they may not have the same desires, skills, aptitude, or goals in life as you.

No, we should surmise that income inequality grew during the nineties.

Great...agreed.

Then I assume there is no substantive credit given to the arguement that the rich got richer during the Bush years any more?

Don't really know what you mean, but according to the data I've seen income inequality has been increasing since the seventies. BTW a decent portion of the problem is wage increases for lower and middle income workers being diverted to fund rising healthcare costs.

I don't think that gets to the real issue. Costs have been rising at colleges and universities for a number of reasons, including a general desire to offer more programs, increased maintainence of new and upgraded facilities and increased staffing costs. Access to loans has allowed the pain of college tuition to be spread out and therefore less obvious. Students loans have a noble purpose and they have done a lot of good for a lot of people, but just as with anything in life there are also negatives.

It seems that every 20 pages or so someone raises the "but the top 1% pay 90% of all taxes" canard. It's routinely shown to be both misleading and somewhat irrelevant, but its strength as a meme can't be denied. Some of you, however, have been in the thread all along and should know better. At least quote the previous arguments as a starting point instead of starting from scratch each time....

This is good to see. The admin plans to start releasing visitor logs with only minimal exceptions.

I'm not sure if you're referring to my argument, but it had little to do with the % of taxes paid by anybody. It was to highlight the inaccuracy of arguements made about how the rich got richer under Bush...as if that doesn't happen under every administration.

Sorry if the thread gets cluttered with posts making arguements you disagree with. Perhaps I could throw in the occassional Bush admin lied about WMD for your sake. Because that certainly has only been stated once in this thread.