Entries Tagged 'Taxes' ↓

Taxes – Impact on Income Inequality

“These jobs are goin’ boys and they ain’t comin’ back” Bruce Springsteen “My Hometown”

Review of Robert Reich’s 2013 Documentary “Inequality for All” – part 3 of 4

Two economists, Piketty and Saez have studied US income tax rates over the past one hundred years. Their graph of income inequality looks similar to the iconic Golden Gate Bridge with its two peaks occurring in 1928 and 2007, right before the biggest economic crises in the US.

Golden Gate Bridge stock photo

From this study, Robert Reich can conclude that:

Income inequality correlates directly with lower taxes on the rich and higher taxes on the middle class

Yes, history shows that the lower the tax rates for the wealthy, the higher income inequality in the US becomes. The higher the tax rates on the wealthy, the lower income inequality becomes. Continue reading →

Bookmark and Share

Break the Budget Impasse – A Tax Cut that Raises Revenue

House Republicans have said they just want a “little something” from the Democrats in order to sign a clean debt limit bill. They want some kind of spending cuts to help them save face. Well, how about a tax cut – a tax cut that will also be a stimulus helping to restore jobs and raise revenue?

Most of us agree that consumer demand is a major sticking point to growing our economy. Corporations have more than enough money to expand production of goods and services, but there aren’t enough people out there able to buy their products.

In particular, those Americans with the least amount of money now have even less money to spend. Years of steadily declining wages and now, as a result of the financial crisis, loss of interest income, and for some, their homes and jobs, have led the descent into belt-tightening just to pay the bills. This contributes to a sluggish economy on the one hand, and a lessening of tax revenue on the other.

The Republicans’ answer seems to be trim the national budget by taking more away from those on entitlements. The Democrats point out that this will reduce the amount of spending American citizens do.

What if we could increase the spending by workers who collect entitlements? Continue reading →

Bookmark and Share

A No-Cost Tax Break for Self-Employed

A reader of a recent post asked, Nancy, I understand that a self-employed person has to shoulder the expenses that an ordinary wage or salaried person does not. But if those expenses are legitimate, and a self-employed person doesn’t earn enough to pay SE tax, how can that person even make a living to survive? If they aren’t making enough revenue to cover their costs of operating their business, how can they afford to cover their personal expenses to survive?

This is the key question I’ll discuss today. It’s why I believe some self-employed workers need a break on paying SE tax. Continue reading →

Bookmark and Share