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Economy
In reply to the discussion: Weekend Economists' 19th Nervous Breakdown April 6-8, 2012 [View all]Demeter
(85,373 posts)4. The Fable of the Century By Robert Reich
http://www.nationofchange.org/fable-century-1333725772
Imagine a country in which the very richest people get all the economic gains. They eventually accumulate so much of the nations total income and wealth that the middle class no longer has the purchasing power to keep the economy going full speed. Most of the middle classs wages keep falling and their major asset their home keeps shrinking in value.
Imagine that the richest people in this country use some of their vast wealth to routinely bribe politicians. They get the politicians to cut their taxes so low theres no money to finance important public investments that the middle class depends on such as schools and roads, or safety nets such as health care for the elderly and poor.
Imagine further that among the richest of these rich are financiers. These financiers have so much power over the rest of the economy they get average taxpayers to bail them out when their bets in the casino called the stock market go bad. They have so much power they even shred regulations intended to limit their power. These financiers have so much power they force businesses to lay off millions of workers and to reduce the wages and benefits of millions of others, in order to maximize profits and raise share prices all of which make the financiers even richer, because they own so many of shares of stock and run the casino.
Now, imagine that among the richest of these financiers are people called private-equity managers who buy up companies in order to squeeze even more money out of them by loading them up with debt and firing even more of their employees, and then selling the companies for a fat profit. Although these private-equity managers dont even risk their own money they round up investors to buy the target companies they nonetheless pocket 20 percent of those fat profits. And because of a loophole in the tax laws, which they created with their political bribes, these private equity managers are allowed to treat their whopping earnings as capital gains, taxed at only 15 percent even though they themselves made no investment and didnt risk a dime.
Finally, imagine there is a presidential election. One party, called the Republican Party, nominates as its candidate a private-equity manager who has raked in more than $20 million a year and paid only 13.9 percent in taxes a lower tax rate than many in the middle class... PUNCHLINE AT LINK
There are two endings to this fable. You have to decide which its to be....
Imagine a country in which the very richest people get all the economic gains. They eventually accumulate so much of the nations total income and wealth that the middle class no longer has the purchasing power to keep the economy going full speed. Most of the middle classs wages keep falling and their major asset their home keeps shrinking in value.
Imagine that the richest people in this country use some of their vast wealth to routinely bribe politicians. They get the politicians to cut their taxes so low theres no money to finance important public investments that the middle class depends on such as schools and roads, or safety nets such as health care for the elderly and poor.
Imagine further that among the richest of these rich are financiers. These financiers have so much power over the rest of the economy they get average taxpayers to bail them out when their bets in the casino called the stock market go bad. They have so much power they even shred regulations intended to limit their power. These financiers have so much power they force businesses to lay off millions of workers and to reduce the wages and benefits of millions of others, in order to maximize profits and raise share prices all of which make the financiers even richer, because they own so many of shares of stock and run the casino.
Now, imagine that among the richest of these financiers are people called private-equity managers who buy up companies in order to squeeze even more money out of them by loading them up with debt and firing even more of their employees, and then selling the companies for a fat profit. Although these private-equity managers dont even risk their own money they round up investors to buy the target companies they nonetheless pocket 20 percent of those fat profits. And because of a loophole in the tax laws, which they created with their political bribes, these private equity managers are allowed to treat their whopping earnings as capital gains, taxed at only 15 percent even though they themselves made no investment and didnt risk a dime.
Finally, imagine there is a presidential election. One party, called the Republican Party, nominates as its candidate a private-equity manager who has raked in more than $20 million a year and paid only 13.9 percent in taxes a lower tax rate than many in the middle class... PUNCHLINE AT LINK
There are two endings to this fable. You have to decide which its to be....
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Exactly. Bankruptcy is one of only two individual rights specifically addressed in the
Egalitarian Thug
Apr 2012
#79
What's all the fuzz about money? (THEY MEANT TO SAY: "FUSS") A MUST-READ ARTICLE!
Demeter
Apr 2012
#21
Here are 10 things you may have missed this week that are worth noting...OR NOT
Demeter
Apr 2012
#23