There is a huge disparity in American income. And there is simply no denying it. The distribution of wealth is vast and deepening at an alarming rate. What is the answer to reducing the fiscal distance between classes?
Our policy now is to send the federal government after the upper echelons of society like some thug to hold them ransom for an ever increasing percentage of their income. Is it any wonder that they maintain a cold and disdainful attitude towards the lower income brackets?
People want to blame the rich, but they just want to be given more. It is easier to feed the mob a scapegoat than to persuade them to take actions which will benefit them and posterity.
About half of all Americans pay no income taxes whatsoever. And the vast majority of income taxes are paid by the wealthy. A recent Congressional Budget Office (CBO) study shows that the top 20% of taxpayers pays 94% of all income taxes. Is it right to demand an increase for the upper brackets and no one else? They are already responsible for nearly all of our federal income.
Our present government policy continue the trend of raising the taxes on higher income entrepreneurs, forcing the moneymakers to leave the country due to huge tax rates. When the rich are hit with higher rates, they do what is natural to protect their investments, they leave. America is then left with more poor and less rich people. And the gap widens…
If I was making an absurd amount of money, I would be working hard for it. Then along comes the federal government to take a massive chunk out of it to distribute on a number of federal programs for education, healthcare and other necessary issues. These programs, while noble in intention, are massively wasteful. Big government is inefficient when spending with our money; it always has been. Private industry and organizations have a much more successful track record.
Our jobs are flocking overseas because the policies overseas make their workforce more appealing. There are incentives to invest abroad. The returns are higher and the taxes lower. The labor force is grateful to have the jobs and their employers are glad to be making a profit with much more reasonable tax rates. Where is the incentive for the wealthy to invest in America?
If we insist on taxing them at a higher rate, we will simply drive rich people out of America in into the loving embrace of lower tax rates in various other nations. What needs to be found is a way to inspire patriotism and altruism in those capable of making a difference.
Offering incentives to invest in America, its infrastructure and business is the key to a stable economy. If we continue to drive the wealth from our nation we will be left with fewer people capable of, or willing to invest in the future of our nation. I know there is a huge problem in the division of rich and poor. The gap is enormous. But there are ways to bridge it, and pointing fingers is not one of them.
Don’t just simply demand more money for the federal government to distribute. We need to win the hearts of the higher income individuals and their financial prowess, not demand handouts. The wealthy should want to employ the poor, giving them money to produce, develop and strengthen the economy. Inspire them to have faith in the American workforce; demonstrate to them there is profit to be made there and labor to be utilized. Offer tax breaks for them when they support the development of infrastructure in America or support a charitable organization, particularly urban and poverty stricken areas in dire need of funding.
There will always be rich people. There will always be poor people. You can’t get past it. But just offering handouts to the poor out of the pockets of the rich is not the way to bridge the gap between rich and poor. It only serves to widen the gap, and instill a sense of ‘otherness’ and mutual distrust between economic classes.
We need to focus on finding common ground, not blaming each other. Inciting class warfare does not bode well for America. It only serves to reinforce the stereotype that we are different in class and status and therefore, fundamentally unequal.
1. Michelle Horn, Economic IMs of the 21st Century, 2012
2. Congressional Budget Office, The Distribution of Household Income and Federal Taxes, 2008 and 2009