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by jon_adler
1433 days ago
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Some people still believe in the fantasy of trickle down economics and the Laffer curve, so they push for lower corporate and marginal tax rates that help the wealthiest. The vast majority of people do not benefit as the money flows upwards and concentrates with the wealthiest over time. Some redistribution is needed to promote equality and fairness. Instead, what we have at the moment is a system where the wealthiest are able to avoid taxes and end up paying a lower marginal rate than the middle classes. |
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Consumers who spend a majority of their income on food, energy and housing are paying more in than they get back because the income they receive from assets is smaller than their living expenses aka the income share of labor is less than 100%.
Imagine being so rich that you can live off dividends, there is no reason for your wealth accumulation to ever stop. The amount you pay into the economy is much lower than the income you derive from your assets.
This is the reason why there is a constant flow of money toward the top. When you think about how a market economy worksy the above is completely illogical. The entire point of markets is to trade which means those who have too much give to those who have too little in exchange for monetary compensation.
Why doesn't the same happen with money? Why isn't money flowing from those who have too much to those who have too little in exchange for their labor?
Instead, those who have too much get more and those who have too little get less, this is highly inefficient.