Sunday, November 20, 2011

Income Inequality - More Socialist Spin

Cards talk and numbers don't lie; but Socialist do lie all the time.   This time it concerns the latest manipulation of numbers related to income inequality.   Socialists and the lame stream, left wing media claim that the rich have gotten richer since the Bush Tax Cuts were enacted in 2003, while the poor have gotten poorer presumably because of the "greedy" rich.   It is very easy to spin these numbers; but here are the facts recently published by Fortune Magazine. 

Since 1962,  not 2001, net worth of the top 1% of income earners in the US has grown from $6 million to $14 million in 2010.  In the same time period, the top fifth of income earners have grown in their net worth from $800,000 to $1.7 million.   The middle fifth have growth in their net worth from $52,000 to $65,000.  And, the lowest fifth of income earners have lost ground.  They had negative net worth, or debt of $7,000 in 1962 and now their debt is $27,000 as a result of access to more credit cards, or just plain dollar devaluation.  

So,  just looking at these numbers on the surface, it does look like the rich got richer and the poor got poorer; but for one serious fact.  The dollar has diminished in value since 1962 dramatically.   A middle class home in 1962 cost about $30,000 in most regions of the country.  Even with declining home values today, average home price in the US exceeds $200,000.   So it is hard to argue that the rich are any richer today than they were in 1962 and they may even be poorer and it has nothing to do with the Bush Tax Cuts.  

More important, the poor are not poor because of the rich, especially given the trillions of dollars that have been spent on the poor since Lyndon Johnson's Great Society entitlement programs were enacted into law in 1965.   The poor are poor because public education, which is lousy in the inner cities of the United States, has served them badly and that coincides with the rise of teacher unions in the last 30 years.   And, there is no escaping global competition for the poorly educated in the United States.

In fact, most of the 25 million unemployed, underemployed working part time that want full time work, or who have just given up looking for work altogether in the United States are Americans with just a high school education, or no high school diploma at all.   Many of these people have little or no job skills.  Unemployment among college graduates is just 4.5%, which is really full employment for college graduates since there will always be young people that just won't take a job because they are living off their parents.   Well dah!

And, then there is global competition.   The poor in the United States are now competing with better educated people in China, India and other countries willing to work for far less money.   Lets face it, poor Americans, with no job skills, that cannot even read at grade level, can't compete in a global economy.   This has nothing to do with the rich; but rather failing public schools run by teacher unions that refuse to allow real accountability and or School Vouchers for these children to get them out of lousy public schools.  

Socialists scream income inequality as their cry to justify higher taxes on the "rich" defined by Socialist President Obama as Singles earning more than $200,000 a year and married Couples earning more than $250,000 a year, even though the "rich" have nothing to do with causing income inequality, if it does exist.    This Blogger keeps saying that Obama should send the "rich" a thank you letter every year for paying all the income taxes in our country.  The top 1%, you know all those millionaires Obama continues to demonize, pay 37% of all income taxes in our country.  The top 5%, those Obama describes as the "rich" already pay 50% of all income taxes in our country.  The top 10% of income earners pay 68% of all income tax in our country.   The bottom 50%, those below the median income, Obama's PEEP's, that earn 13% of all income in our country pay just 3% of the income taxes in our country, if any at all.  

How much more progressive or "fair" can our tax system possibly be related to redistribution of income.   Apparently for Socialists that support income redistribution to give to their uneducated PEEP's in the name of social justice,  the "rich",  4 out of 5 of which are small businesses,  never pay their "fair share" no matter how much they pay.   Of course, Socialists like President Obama continue to lie about all of these facts in a desperate attempt to stay in office. 

There are about 115 million households in the United States where our 310 million people live.  Out of that number 496,000 Households are worth $30 million or more.  2,292,000 Households are worth $5 - $30 million.  7,753,000 Households are worth $1 - $5 million.   So there are about 10,541,000 Households out of 115 million that are presumably "rich", or roughly 9.5%,  but keep in mind this includes all assets like inflated home values.    If all of their assets combined were confiscated by the federal government, which Socialists and Communists would love to do, it still would be impossible to pay off our $15 trillion National Debt, or continued trillion dollar deficit spending.   Socialist want to use the income inequality red herring as an excuse to raise taxes on the "rich".   It is as simple as that. 

The fact is that we have a spending problem in the US, not a revenue problem.  Even after the Bush Tax Cuts were enacted in 2001, revenues to the federal government increased by $745 billion because until the last year of the Bush Administration and the financial crisis that began in 2007, unemployment was very low.   The problem was not revenues specific to the Bush Tax cuts.   The problem is and was that politicians of both parties always spend more money than the federal government takes in, no matter how much it is.    So giving them even more money will not insure that deficit spending stops unless and until we have a Balanced Budget Constitutional Amendment. 

Raising taxes on the "rich" is not the way to deal with income inequality if it does exist in real terms.  The only way to raise all boats is to cut taxes and regulations in order to restore economic growth and job creation once again in the US.   And, if the poor have really gotten poorer, after the trillions spent on them in Great Society entitlements, it is because they have endured failing public schools and they have no marketable job skills to compete in a global economy.   The only way to fix this problem is to reform our public education system to allow for real accountability and School Vouchers.  We must also make sure that no kid graduates from any high school in our country who in not either prepared to enter college, or on track to receive a vocational education to learn a job skill that is marketable.  

None of these things will happen as long as Socialists are in power because they want their PEEP's dependent on government as their ticket to staying in office and they are owned lock, stock and barrel by the teacher unions.   Socialists, including President Obama, want the income inequality issue as part of their Hate Speech Class Warfare strategy to divide our nation in an attempt to stay in power.   Let's not forget that Socialists in office get rich feeding at the trough pretending to care for the poor, when it is Socialists that live off the misery of the poor.    

We have to take back our country in 2012 and 2014 for the sake of all Americans; but especially for the poor that are stuck at the bottom of our society because of lousy public schools and government dependence.  Obviously, spending trillions of dollars on the poor since 1965 has done nothing to alleviate poverty in America as 45 million Americans are now on Food Stamps, since Obama's election, the highest number in our history.   If government programs funded by higher taxes were the answer, there would be no poverty in America today.  In the mean time, don't believe the Socialist Spin you hear related to income inequality.   It is just more Socialist baloney being used in their Hate Speech Class Warfare argument as an excuse to raise taxes to keep the poor dependent on government as their ticket to power and personal wealth.   

Remember, more than 50% of the members of Congress are millionaires and a lot of them are Socialists.   How did that happen on $174,000 a year paid to a Congressman or Senator especially if they were not rich when they began their years in office.  Oh Yes, members of Congress are allowed to take advantage of insider trading that would put the rest of us in jail.  Now that is real income inequality by elected officials feeding at the trough.   Go figure. 

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