The fundamental question: Why is inequality bad?

I believe our civic obligation ends by solving for official poverty.

 

Yes. Let's say you have some money. You then spend that money to purchase, say, real estate. You now have the real estate, and the person who sold you the real estate now has the money. You have returned your money to the economy (i.e. other people).

- - - Updated - - -

The unpredictable is only possible in innumerable fulfillment.

 

Tying money up in real estate isn't very liquid.

Solving for simple poverty at the rock bottom cost of a form of minimum wage is a market recognizable metric under any form of Capitalism.

 

So when a rich person buys a summer home from another rich person... i.e. they exchange assets, how does that create jobs... one guy has less cash, and a house, the other guy has more cash and no house.. no job was created.

Sure, building mansions and summer homes creates a few jobs... but if your argument is that we need to have the rich have even more money so that the yacht industry, supercar industry and the mansion building industry and maybe the landscaper industry grow, that is nonsensical.

Trust me, I come from a wealthy family. Honestly, we are not creating jobs with our millions of dollars. Sure, we employ interior decorators and buy some high end goods, but that is not the demand that drives the economy. But you are right, Ferrari is doing great and able to sell million dollar cars with ease.

 

Someone said that rich people hoard their money. I have demonstrated that this is not true. They either lend or spend their money. When a rich person buys a summer home he is spending his money, not hoarding it.

 

You ignored every other category I posted,,, what about hedge funds, mutual funds, Exchange traded funds, FDIC insured bank accounts and stocks. Does buying these create jobs? You said this was "pumping it back into the economy." which I assume you mean is growing the economy and creating jobs..

If you mean buying stocks is "spending" then sure... but more demand for stocks just increases the price of stocks... Is your argument that is the best use of capital in the economy?

 

It isn't the same as creating demand by increasing the circulation of money in our Institution of money based markets.

 

How do you solve self impoverishment? Not everyone wants to succeed. What since does it make to eliminate non living wage jobs for those seeking non living funds like gas for a car or money for a date? How about paid on the job training? Minimum wage laws only suppress opportunities. Not everyone is a breadwinner.

 

Create jobs? I said nothing about creating jobs. Someone said that rich people hoard their money. I have explained that this is not true. They either spend or lend their money. All of those things are example of assets for which rich people exchange their money.

 

I am not sure what you mean by solving for "self-impoverishment". And, what do you mean by "succeed" under our form of Capitalism? Only the religious claim to believe in poverty as a way of life.

 

Obama and Dems position is "providing opportunity to increase the middle class, providing chance to achieve a higher wage and then taxing you and taking away tax credits that effectively put you back into a lower income level. Those in the upper middle class, finally achieving it, now are taxed to death, lose the deductions they use to get and putting them in the same category as millionaires+. When they don't have the millions to put into lower taxed capital gains. I say B.S. They don't really want you to earn more when, when you do they simply take it away in increased taxes and lost deductions that lower tax brackets get. Every tax payer should be taxed the same rate on their "ordinary income". If you earn $1.00 you should pay .10. Earn $100,000.00 you pay $10,000.00 and so on. No deductions, no credits. Simply 10% on your "gross income". if you owe ordinary income tax. Business, both small and large should pay 20% on the "net income". Tax on Capital Gains should then be taxed at 30%. Just my opinion.

IMO, only those that pay no tax on their income and benefits from tax credits are the ones complaining that those individuals and families earning income above $200,000.00 aren't paying enough. Wrong, they are paying the majority of Federal Income Tax. Taxing those that don't pay anything, even $1.00 a tax year would virtually balance our budget.

Stop complaining about the individuals and families you have determined are "rich". Pay you fair share in Federal Income Tax. Why should those earning over $200;000.00 a year, net pay virtually all of the collected Federal Income Tax. And, why should nearly 50% of the employed pay nothing many that pay nothing actually get money back in the form of tax credits. Not fair, not right.

Earn $100.00/year, pay your $10.00. Your cost for living and reaping the benefits this Country provides. Earn $10.00 pay your .10.

 

This is precisely why vast wealth inequality hurts the poor, as in, it actually steals from them. See, the rich have so much money that they put it in the bank (as they are unable to spend it all), as opposed to the poor, who spend a much larger percentage of their income. The bank then takes the money deposited by the rich, and doesn't just lend it out, but lends MANY TIMES that amount, creating much more money out of thin air. This flood of virtual currency devalues the dollar (simple supply and demand), thus reducing the purchasing power of the poor even further. Meanwhile, the devaluation of the rich man's currency is offset by the interest he receives from the bank.

 

Rich people don't hoard money, that is a fallacy people who envy the rich like to use to justify their irrational hate.

Wealthy people invest their money because they know if they hold on to it they won't make any money.

This is why wealthy people have money advisers, managers and portfolios.

 

The problem with poverty is that it is very subjective. Also, many who are deemed impoverished are purposely where they are. Some people do not wish to put in the effort to climb above the governments definition of poverty. How do you fix this? Is it your business to do so? Many purposely qualify so to get freebies. Welfare is more a path of least resistance that is causing the very thing it wishes(more to buy votes than help anyone) to eliminate.

 

It may just come down to the law of large numbers; there are simply more poor people that could be spending than there are rich people who can spend money.

 

They invest their money so they can pay lower Capital Gains taxes on the earnings from the investment.

 

Prosperity is not about spending. It is about producing. Redistribution does not promote production, it more promotes dependency and lack of initiative. Most rich people work and invest, those not worthy of retaining wealth will usually blow it or not earn it. The key to prosperity is for as many as possible to be motivated to produce.

 

None of that matters because money isn't finite, so there is always going to be enough money.

Also, poor people would have more if the government minded their own business and let the free market work how it's supposed to. Instead we have crony capitalism and economic interventionism which businesses are stuck footing the bill on.. The less money a business has - the less money they can play in salary. Also, people trying to make careers out of flipping burgers and sweeping floors doesn't help their cause either. Another fundamental that plays a role in wage is basic supply and demand of skills.

We should be advocating learning trades and other skills instead of listening to grievances from people who have no desire to learn anything in order to better their life.

I can't feel sorry for someone who is poor but refuses to work, or if they do work are more than content doing remedial work that is on the bottom of the supply side. Paying them more money to do a job teenagers do is not the solution - learning a skill that's in demand is.

The truth is certain political parties need the poor because they wouldn't have a platform to run on if poverty was a minor problem. So why would these politicians help the poor if they need them to pander to in order to keep their jobs as professional squawkers? yes job security of their own.

 

You actually believe people invest money to avoid paying taxes?

First of all it all depends on what they invest in - short term investments or long term investments. Most wealthy people such as venture capitalists invest in long term investments, they don't play the ponies on Wall Street, they invest in small businesses, real estate and other assets that appreciate over time.

As far as those who invest in the stock market - there are a lot of regulations for investors. Short-sells are taxed out the ass, so investing in stocks to avoid paying taxes would be moot, because in the end they'll end up paying more in taxes on the capital gains on short sales than they would on the cash.

So no - the wealthy don't invest cash to avoid paying taxes. There is no true way to shelter money unless they buy bonds which is a long term appreciating asset, and many won't do that unless they're comfortable waiting until they mature.

 

They invest money in those investments where profit from those investments are taxed at the lower tax rate. Because they have large amount of money to invest they are able to do this much more than those with less disposable income. You disagree? "they wealthy don't invest cash to avoid paying taxes", possibly not, but they do invest to pay lower taxes. And, they have more money to invest in real estate, businesses; both which offer many tax deductions. Sorry but those are the facts, ask any corporate tax attorney or a tax attorney working for individuals earning a million plus.

 

Wealthy people invest money to make money..

No, I don't agree because most of the "wealthy" I know have little cash on hand - they don't have massive bank accounts because all their money is tied up in long term investments. Sure on paper they may be worth 5-6 million bucks but they only have 10-15 grand in their personal checking account. That is quite typical. Sure if they want to make a large purchase they can because they have almost unlimited credit but most wealthy people are quite frugal so they don't buy a ton of luxuries.

 

No, all of their money is invested in stocks, bonds, real estate that pay them monthly income and that income is taxed at a lower tax rate. They don't want "ordinary income" that will be taxed at "ordinary income tax rates" likely the highest tax rate. You need to do some studying on the subject as you simply don't get it. The reason they can avoid paying ordinary tax rates is because they live off their investments, taxed at lower capital gains tax rates. That is something even upper middle class taxpayers have difficulty taking advantage of because they don't have the disposable income to invest. And, it isn't about buying luxuries, it is about investing in money making ventures where the money made is taxed at a lower rate. Buying a yacht, unless used for business purposes is not going to save on taxes as it doesn't produce any income. You got it wrong.

 

Exactly. They buy things, like land, building, stocks, bonds, etc as investments. And in doing so they give their money to the seller, returning it to the economy.

This talk about the rich hoarding money and keeping it "out of circulation" is bunk.

 

Psst. When a working class person holds a mutual fund in his IRA or 401k he also pays that same lower rate on his qualified dividends and long term capital gains.

 

`
This sums up my feelings on this topic;
`
`
`
`

​

`