Thursday, June 28, 2012

Ten Fingers: The Super Rich 1/3

Ten Fingers: The Super Rich and Job Creators

Intro: here in America we have a bracketed tax system. These brackets make it so that people pay for government based on what they can pay and how much that affects their overall financial security. But our tax system has skewed and politics has concealed a very stark picture.

Put up ten fingers—that’s America. One and a half fingers are below the poverty line in America—that’s 46.2 million Americans. These people understandably have an effective tax rate of 0%. Often they receive rebates and government services because of their status.

Think for a moment though, how does that affect you other than take your tax dollars? Well, if your ten fingers are America nearly 6 of them (58%) will fall below the poverty line sometime during their professional lives (between 25 and 75). So actually, it’s more like you, the reader have a 60% chance of using government services for those in poverty sometime in our adult life.

And if all your fingers are college graduates, somewhere between four and five fingers do not have gainful employment upon immediately leaving their hallowed institutions. These are highly qualified individuals that can work for depressed wages. Basically, there aren’t a lot of jobs out there.

America is full of poor people and because most of them will leave the poverty threshold after a brief stint it is realistic to assume they are willing to work.

Now, either private industry gives them jobs or the government does. If we want to kickstart the economy we need ‘job creators’ to start hiring. The Mittster would have you believe two things.

One, private industry is stifled by regulations and taxes. Job creators do not have enough free capital to hire new people. I’ll counter that neither of those points are true.

Thesis: in fact, job creators suffer from a lack of capital because the super rich have political policies that benefit the hoarding of money rather than the free flow of cash. I’ll also show that broader tax policies that encourage wealth creation across the economic spectrum are superior to ones that focus on the hyper-wealthy. And just with ten fingers (maybe more).