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by warrenwilkinson 5513 days ago
Doesn't look like anything to me. This shows the tax rates: http://www.truthandpolitics.org/top-rates.php. They climbed up for WW1 & WW2, and now are falling back to historical levels.

And here is income distribution: http://en.wikipedia.org/wiki/File:United_States_Income_Distr...

which again, shows nothing sinister. Where one man made $2 to anothers $1, now that man is making $200 to the others $100.

Also can anyone substantiate the claim that the super rich lend the government money? As far as I knew only the Federal Reserve lent money to the government.

3 comments

Looking at the top rates, without taking deductions into account, is pretty useless.
But it was during the period of WWI and WWII that America became a super power. The syphoning of wealth from the general populace will ensure that America will no longer be a super power any more given a generation or so. America is repeating the economic history of a number of past empires; once the overall growth goes the rich try to take a bigger slice to keep their relative growth up, which leads to collapse. The transition of wealth to other countries like China has already begun.

If you have a look at the graph you'll see that in the 40' the top 95% was approximately 4 times the 20% line, by the end of the graph that is approximately 8x, so the ratio doesn't hold at all. Have a look at http://en.wikipedia.org/wiki/Gini_coefficient and you'll see that the Gini index in the US has been steadily increasing, boiling frog style, since the 80's. I wouldn't be surprised if the US's Gini index was worse than Mexico by these days (i.e. the US has a bigger problem with the _relatively_ poor than Mexico).

If you look at the colour coded map of the world you'll see that Europe's socialist states, basically all of them, have less of a problem with the relative poor.

A more useful graph of income distribution would be inflation adjusted - this graph might be useful in that regard (shows the larger overall take of total income by the extremely wealthy):

http://en.wikipedia.org/wiki/File:Share_top_1%25.jpg

Regarding the lending question - the wealthy lend through buying government securities, in the same way that any fixed financial instrument works - you give someone X dollars, you expect X+% back.