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Who are the people who pay income taxes?

Email Print posted by KenTX 07/22/2008 05:46:05 AM EST

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Certainly not the bottom 50% of American wage earners. Most of them pay no income tax at all.
numbers 1

 numbers 2




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Who are the people who pay income taxes? | 35 comments (35 topical, 0 hidden)
Who are the people who make this shit up? (none / 0)

Why...Newscorp of course!

The way to soak the rich is with low tax rates, and last week's IRS data provide more powerful validation of that proposition.

I see Rupert wasted no time in taking charge of the editorial page of the WSJ.

Here is the old RNC talking point presumably given gravitas by the WSJ. "If we cut taxes we'll make more money." Walmartification of the US Treasury.

So we are given this "fact":

 Taxes paid by millionaire households more than doubled to $274 billion in 2006 from $136 billion in 2003

 Yet earlier, we were regaled with this "fact"

from 2003 to 2006. The ranks of U.S. millionaires nearly doubled to 354,000 from 181,000 

 Humm....I'm not an economist but I did stay in a Holiday Inn Express once. Its far from certain that the millionaire increase is because of the tax cuts other than a simple mathematical coincidence.  Lets see the amount of millionaire households as reported by the IRS double from 2003-2006   and  the tax receipts from millionaires household doubled in 2003- 2006. Wait, wait I know what this is....AMWAY!


There is rapid turnover in the ranks of the highest income earners, so much so that people who started in the top 1% of income in the 1980s and 1990s suffered the largest declines in earnings of any income group over the subsequent decade, according to Treasury Department studies of actual tax returns. It's hard to stay king of the hill in America for long.

Particularly when the "rich" are free trading away the jobs and industries that generated a lot of those incomes. Or they simply got older...as most people do and their income decline as they neared or entered retirement. Its hard to stay in the prime of your life forever, contrary to Republican mythology.

The idea that tax cuts make the rich more "honest" is laughable. They are still sheltering income and now they can invest more in ,oh...lets say stuff like mortgage based securities..oil futures...things that add very little to the overall economic well being of Joe Sixpack.

by MRFred on 07/22/2008 08:08:29 AM EST

facts are stubborn things (none / 0)
It always amazes me how Fred can read an article, criticize it, while completely ignoring the facts that destroy his own argument. Here's an example.

MRFred: "Its far from certain that the millionaire increase is because of the tax cuts other than a simple mathematical coincidence." 

Here is how the Wall Street Journal interpreted IRS data for the years 2003-2006. Remember, that in 2004, John Kerry and the Democrats were telling us that America was experiencing the worst economy since the 1930s.

America suffered multiple economic body-blows from the 9/11 attack, the Dot.Com bubble, and the deep recession of 2002, and yet we came roaring back because of the tax cuts.   

"The most amazing part of this story is the leap in the number of Americans who declared adjusted gross income of more than $1 million from 2003 to 2006. The ranks of U.S. millionaires nearly doubled to 354,000 from 181,000 in a mere three years after the tax cuts.


Taxes paid by millionaire households more than doubled to $274 billion in 2006 from $136 billion in 2003. No President has ever plied more money from the rich than George W. Bush did with his 2003 tax cuts. These tax payments from the rich explain the very rapid reduction in the budget deficit to 1.9% of GDP in 2006 from 3.5% in 2003."

Did you get that?

1. George Bush slashed tax rates.
2. The number of millionaires doubled.
3. Tax revenues from millionaires doubled.
4. Fred calls it "mathematical coincidence".

by KenTX on 07/22/2008 11:13:43 AM EST

[ Parent ]
Yes but... (none / 0)

What did overall tax revenue do?

What did overall average income adjusted for inflation do?

So 170,000 people making half a mil a year jumped to a mil (without adjusting for inflation, of course).  What about the other 330,000 of us.

This is not proof the Bush tax cuts worked, its more likely an indicator they failed.  During the 1920s the average income of the top 1% went up 67%, average income for everyone else went up 7% (non-adjusted).  Then the country fell apart.

This is EXACTLY what the opponent of the tax cuts predicted.  People making 250k plus would get much richer, everyone else  would get poorer and we would teeter on the brink of a depression.  Its like they had a fucking crystal ball!

by ProfRich on 07/22/2008 11:37:40 AM EST

[ Parent ]
I'm glad you asked. (none / 0)
"What did overall tax revenue do?"

From the article: "These tax payments from the rich explain the very rapid reduction in the budget deficit to 1.9% of GDP in 2006 from 3.5% in 2003."

So even though we were spending a billion dollars a day in Iraq, the budget deficit was falling.

And the tax buden was shifted upward to the rich:


2000
2000

2006
2006

by KenTX on 07/22/2008 12:05:57 PM EST

[ Parent ]
Actually (none / 0)

The budget deficits don't take into account Iraq.  That is "emergency spending" and magically doesn't count.

The graphs only shows "wage earners" which is entirely irrelevant since we are talking about corporations and primarily profit takers and cap gains earners. 

Finally, a reduction in the budget deficit could be attributed to thousands of things, to automatically credit the tax cuts is silly.  It could just as easily (more easily) be created by an increase in the taxes paid by wage earners or middle and low income families.  

This is really a pathetic display.

 

by ProfRich on 07/22/2008 12:27:48 PM EST

[ Parent ]
Rich, (none / 1)
Do you realize how many statements in this post are 100% wrong? It would be easy for me to debunk the comments, but I'm wondering why you even posted them. If you believe it, maybe I can help, or something. I'm reluctant to jump on this post and stomp it.

by KenTX on 07/22/2008 03:25:59 PM EST

[ Parent ]
I know this song (none / 0)

It would be easy for me to debunk the comments, but...

It would be easy for me to bench-press a stealth bomber, but... 

It would be easy for me to seduce Veronica Zemanova, but...

It would be easy for me to cure cancer, but... 

Either debunk them or shut up about it.

by OneHitKill on 07/23/2008 03:16:26 AM EST

[ Parent ]
I suppose I have no choice? (none / 0)
ProfRich: “This is really a pathetic display.”

ProfRich: “Either debunk them or shut up about it.”

Wow. I tried to be polite, and ignore Rich’s post, be he remains insistent. Like the time he kept insisting that Bill O’Reilly was circulating a serious petition to have Keith Olbermann taken off the air. I tried to ignore that situation also, but Rich continued pressing in a manner unbecoming a gentleman. So I showed him the original clip. Unfortunately, it omitted O’Reilly’s last comment: “This petition could be considered ridiculous.” But it clearly showed that Rich is uninformed, as usual.

ProfRich: “The graphs only shows "wage earners" which is entirely irrelevant since we are talking about corporations and primarily profit takers and cap gains earners.”

The title of this thread is: “Who are the people of pay income taxes?” Do you need more? 

ProfRich: “The budget deficits don't take into account Iraq.  That is "emergency spending" and magically doesn't count.”

Apparently, you are in error. Here is a CBO analysis of the budget deficit from nine months ago.

Here is the original report from the Congressional Budget Office. This data has to be accurate, because it comes to us courtesy of Harry Reid and Nancy Pelosi.

Pay attention to this part of the analysis of the CBO report.
“For 2007, defense spending, including war costs, totaled $529.9 billion, up 6.1 percent from 2006, an increase that outpaced the 2.8 percent rise in overall spending.”

That statistic comes in conflict with your assertion that the war in Afghanistan and Iraq are not part of the calculated budget deficit. Here is more information on the subject.

“The Bush administration reported Thursday that the federal budget deficit fell to $162.8 billion in the just-completed budget year, the lowest amount of red ink in five years. President Bush, appearing with his economic team to trumpet the news, noted that the deficit turned out to be $81 billion lower than it was projected to be in February. He said the deficit represents 1.2 percent of gross domestic product - less than the average of the last 40 years.

Both revenues and spending climbed to record levels in 2007. Spending rose by 2.8 percent to $2.73 trillion while revenues rose by a faster 6.7 percent to a record $2.57 trillion, a gain the administration attributed to the economic stimulus from the president's tax cuts.

For 2007, defense spending, including war costs, totaled $529.9 billion, up 6.1 percent from 2006, an increase that outpaced the 2.8 percent rise in overall spending. Paying interest on the national debt also outpaced overall spending growth, rising by 5.9 percent to total $430 billion, making it the fourth-largest spending category.”

ProfRich: “A reduction in the budget deficit could be attributed to thousands of things, to automatically credit the tax cuts is silly.  It could just as easily (more easily) be created by an increase in the taxes paid by wage earners or middle and low income families.”  
The CBO report and the Wall Street Journal analysis and the CBS News analysis agree there was a significant drop in the budget deficit, to 1.2% of GDP. Furthermore, they agree that the shrinking deficit was due to enhanced tax revenue.

Did you get that? Significantly enhanced tax revenue occurring simultaneously with significant tax cuts. How is this possible? Because new jobs were being created and incomes were rising.

by KenTX on 07/23/2008 06:05:31 PM EST

[ Parent ]
Money for nothing (none / 0)

ProfRich is not OneHitKill.  And I asked you to follow through on your hot air because your bluffs are big enough to be seen from space.  Like the Great Wall.

Speaking of income tax, I just got my "economic stimulus" check from the US government, which is remarkable because I have only paid Japanese income tax for the past five years.  Appropriately, the check will therefore be spent in Japan.

by OneHitKill on 07/23/2008 09:47:27 PM EST

[ Parent ]
Speed reading (none / 0)
is not conducive to comprehension.

by KenTX on 07/23/2008 11:48:35 PM EST

[ Parent ]
Facts are stubborn things, you should use some... (none / 0)

As usual, you didn't destroy anything except your credibility.

Your position is based on the assumption that the tax cuts created new millionaires.Show us empirical proof that the tax reduction directly resulted in an increase in millionaires.

Before you stick your foot in it; between 2003 and 2006 the number of people filling tax returns of over a million dollars increased by 48% Between 1996 and 1999 millionaires increased by 46%.  And ,we had a budget surplus.

So explain how the numbers millionaires from 1996-1999 managed to increase with all those taxes they were paying? Then the stock market crash yatta yatta yatta. Then Bush cut taxes...I guess the millionaires for 1996-1999 worked harder than this new batch.

Here is a chart of the DJIA for those periods.

This chart is from "Affluent Market Insights"... a marketing firm, it shows the number of affluent and millionaire households from 1997...to 2007 meaning people with a net worth over 1 million dollars increased by  25% From 1997 1999. during the period from 2003 to 2006 they increased increased by 31%, consistent with the tax data. The number of households with net worth over 5 million increased by 61% from 1997-1991, it increaed by 58% from 2003 to 2006,

 

You will note the graph curve corresponds to the DJIA performance.

Increases in the number of millionaires could just as easily , and in all probability was, due to the increase in the stock market.


 

 

by MRFred on 07/22/2008 05:57:28 PM EST

[ Parent ]
Bush Economy been very very good to me. (none / 0)
Fred, let’s show the audience a larger picture of your graph.
millionaires 
 
In the four year (Bush) period, 2002-2006, the number of households with a million dollars net worth increased from 6.2 million to 9.0 million. That’s a 45% increase. The DJIA also increased about 45% during this period.

In the four year (Clinton) period 1997-2001, the number of households with a million dollars net worth increased from 5.3 million to 6.0 million. That’s a 13% increase. But the DJIA increased a whopping 100% during this period!
djia

Something was different about the Bush recovery versus the Clinton recovery. Under the Bush economy, people are able to create significant personal wealth. It’s not just the decrease in the capital gains tax rate and the decrease in the income tax rate. Salaries were increasing at a healthy clip from 2002-2006, but prices were not increasing.

We should analyze salaries versus consumer prices next. That might favor Clinton. We need to stick with 1997-2001 and 2002-2006. No left wing data!

by KenTX on 07/23/2008 06:47:11 AM EST

[ Parent ]
One more thing. (none / 0)
We're talking about a million dollars in net worth, which includes real estate. That can skew the comparison.

It's better to talk about a million dollars in taxable income, or at least a million dollars in investable assets.

by KenTX on 07/23/2008 06:51:37 AM EST

[ Parent ]
Not up to the challenge I see (none / 0)

 

Your position is based on the assumption that the tax cuts created new millionaires.Show us empirical proof that the tax reduction directly resulted in an increase in millionaires.

 

Just a reminder

by MRFred on 07/23/2008 08:38:02 AM EST

[ Parent ]
The challenge is squarely upon your shoulders. (none / 0)
You are the person ducking the challenge. You have avoided explaining how these miraculous events occurred:

"The most amazing part of this story is the leap in the number of Americans who declared adjusted gross income of more than $1 million from 2003 to 2006. The ranks of U.S. millionaires nearly doubled to 354,000 from 181,000 in a mere three years after the tax cuts.

This is precisely what supply-siders predicted would happen with lower tax rates on capital gains, dividends and income. The economy and earnings would grow faster, which they did; investors would declare more capital gains and companies would pay out more dividends, which they did; the rich would invest less in tax shelters at lower tax rates, so their tax payments would rise, which did happen.

The idea that this has been a giveaway to the rich is a figment of the left's imagination. Taxes paid by millionaire households more than doubled to $274 billion in 2006 from $136 billion in 2003. No President has ever plied more money from the rich than George W. Bush did with his 2003 tax cuts. These tax payments from the rich explain the very rapid reduction in the budget deficit to 1.9% of GDP in 2006 from 3.5% in 2003."

Note that the doubling in the number of people with AGRs greater than one million dollars, and the doubling in tax revenues from millionaires has nothing to do with real estate values. What caused it?

I'm waiting.

I'm still waiting.

by KenTX on 07/23/2008 09:22:18 AM EST

[ Parent ]
Nice Flip Flop (none / 0)

 Left wing data? The IRS is left wing now? Affluent Market Insights is left wing? Nice try

No cherry picking of the time frame will be allowed.

I simply proved that during the runup of the  stock market in 1996-1999 the economy generated simular amounts of " millionaires" recorded by IRS tax returns as a analogous period chosen by WSJ. 2003-2006


Now you have chosen to expand that to include the 2000-2001 correction to lower the net worth amount from the Clinton period. Nice try. Of course we could inflation ajust the Clinton years.  10 years of 2 % inflation is a significant amount.

The number of Affluent and Millionaire households has continued to grow for the fifth consecutive year. Growth rates have, however, slowed considerably  Affluent Market Insights

Many of those "millionaires" from 2003 onwards were created by the real estate bubble. So you really need to include the recent real estate bubble crash and stock market retrenchment to get the real picture namely 2007 and beyond. I'm sure the net worth will take a tumble.

But thanks for proving my point, the numbers show that you can grow the economy and balance the budget with out huge tax give away's to the very rich.

by MRFred on 07/23/2008 07:25:36 AM EST

[ Parent ]
How to know when the Bush Economy is working. (none / 0)
Answer: Your personal financial situtation is improving.

“No cherry picking of the time frame will be allowed. I simply proved that during the runup of the  stock market in 1996-1999 the economy generated simular amounts of " millionaires" recorded by IRS tax returns as a analogous period chosen by WSJ. 2003-2006. Now you have chosen to expand that to include the 2000-2001 correction to lower the net worth amount from the Clinton period. Many of those "millionaires" from 2003 onwards were created by the real estate bubble.”
Here are a few facts for you to deal with.
1. 1996 is not on your graph.
2. (Jan) 1997- (Jan) 2001 were Clinton years.
3. The stock market and economy were fine through Jan 2001, so there was no cherry picking.
4. I was the person who brought up the real estate increase as contributory to net worth.
5. A better measure of growth in personal finances is taxable income or investable assets. The Bush economy leads the Clinton economy by both measures.

You can’t overcome the very facts that you brought into the discussion.

In the four year (Bush) period, 2002-2006, the number of households with a million dollars net worth increased from 6.2 million to 9.0 million. That’s a 45% increase. The DJIA also increased about 45% during this period.

In the four year (Clinton) period 1997-2001, the number of households with a million dollars net worth increased from 5.3 million to 6.0 million. That’s a 13% increase. But the DJIA increased a whopping 100% during this period!

I know what the Bush Economy did for my personal finances, and I work in manufacturing. I also know what the Clinton Economy did to my personal finances. I’ll take the Bush Economy any day.

It is inarguable that the Bush Tax Cuts brought us out of the Clinton Dot Com Bubble, and the Clinton Hands Off Osama Bin Laden Attacks.

The tax cuts created significant personal wealth for people who pay high taxes. You’ll just have to trust me on that point.

If you don’t like running a federal budget deficit, then welcome to the club. My suggestion is that you get on board the Spending Cut Love Train. With a budget of $3 trillion, there is plenty to cut.

by KenTX on 07/23/2008 08:40:05 AM EST

[ Parent ]
Here are some more facts... (none / 0)

No...nice try again...lets go back to the original post . You included the WSJ article  which concluded with

The way to soak the rich is with low tax rates, and last week's IRS data provide more powerful validation of that proposition.

and the thrust of the article and your subsequent posts was how wonderful all the new millionaires are and proof that tax cut creates more revenue for the Fed.

Your words

Did you get that?

1. George Bush slashed tax rates.
2. The number of millionaires doubled.
3. Tax revenues from millionaires doubled.

Yeah I did get it...and I disproved it.  Your reference for those statements focused on the period 2003- 2006. I went to the IRS table and chose the period of 1996 -1999. As I said, and you ignored, that was a analogous period prior to the stock retrenchment on that began in 2000 onward...and as we are going through from about 2007 through today.

When Bush took office in 2001, the CBO was forecasting a decade of budget surpluses totaling more than $5 trillion. CS Monitor

The point was and is that tax return millionaires increased by the nearly same percentage when both periods of economic expansion were compared, one with tax cuts one without. One with deficit..one without. So moving to the present:

So what is it that has driven up tax revenues so dramatically over the past couple of years? "It's actually fairly clear," says the dean of America's tax-policy geeks, the Urban Institute's C. Eugene Steuerle. "It's just the increasingly unequal distribution of income."

That is, the federal deficit has been shrinking because the rich have been getting richer. This is not a development the President is likely to brag about the next time he makes a speech about the economy. But, hey, it pays the bills.

And by the way, There is always cherry picking when you post Ken, come on. Make up on a pig and all that.

When income gains are skewed toward those who pay taxes at the highest marginal rate, which is now 35%, revenues go up faster than if income rose evenly across all tax brackets. And sure enough, the trend toward more uneven income distribution has been boosting the government's bottom line for decades. In 1979 those with incomes in the top 0.1% of American taxpayers (those with $233,539 or more in adjusted gross income) accounted for 3% of income and 7% of tax receipts, according to the IRS. In 2000 the cutoff for the top 0.1% was $1.6 million, and their share had grown to 10% of income and 19% of taxes.

You included the stock market decline period for Clinton for  that reason while excluding 2007..to pump up the "Bush" percentage.If you include 2007...its 32%. 

When the 2008 numbers come in...I will bet the "millionaires' and net worth will decline...significantly.

I included the AMI  chart from to show wealth increased as well...and millionaires by tax returns increased The curves roughly mirrors the DJIA graph And AMI included this comment to the wealth chart

The number of Affluent and Millionaire households has continued to grow for the fifth consecutive year. Growth rates have, however, slowed considerably.

The slow down has already effected the growth of "millionaires".

The tax cuts created significant personal wealth for people who pay high taxes. You’ll just have to trust me on that point.

No need to trust you, you can trust me, I can explain it to you if you want. But beyond our good fortune:

The personal--income tax windfall from increasingly unequal income distribution, though, could be with us for a while. The President can even take part of the credit for it: lower tax rates on the highest earners give them less incentive to shelter income from taxes. But a similar high-income tax boom happened in the late 1990s, so Bush can't take too much credit. He might not want to: the shift in incomes toward the top may be great for the federal budget. Whether it's a good thing for the U.S. beyond that is an entirely different question.

 And that is THE point

by MRFred on 07/23/2008 09:57:04 AM EST

[ Parent ]
By the way (none / 0)

 The idea that this ( tax cuts)has been a giveaway to the rich is a figment of the left's imagination. Ken Tx

Note that the doubling in the number of people with AGRs greater than one million dollars, and the doubling in tax revenues from millionaires has nothing to do with real estate values.Ken TX

 

So much for spin from the right....




by MRFred on 07/23/2008 04:44:43 PM EST

[ Parent ]
The good old days (none / 0)

Remember when the Republicans were trying to beautify Reagan and they endlessly insisted a president's economic impact was felt in the next administration?  So the Clinton Boom was really the Reagan boom, they claimed.

I guess if Ken wins this argument we can finally expose Reagan for the piece of shit president he really was.  So either way, we win.

by ProfRich on 07/23/2008 10:30:52 AM EST

[ Parent ]
You're forgetting step 2.5 (none / 0)
"The middle class SHRANK.  A LOT."

by jarett on 07/22/2008 06:07:08 PM EST

[ Parent ]
::::Counfused stare::::::: (none / 0)

The Middle What?

What the hell is that?  Who gives a shit about them?  We are talking about millionaires, man.  And you think anyone give a fuck about this?

Actually, I asked my son and he said they have a chapter on the middle class in his history textbook.

by ProfRich on 07/22/2008 06:27:55 PM EST

[ Parent ]
The Trickle Down Myth (none / 0)

It seems that supply-siders aren't above a flip flop or two.

During Reagan the tax cuts where going to create jobs and economic opportunity for all of us poor folk! Then we would march hand in hand rich and the no longer poor to that shining city on the hill...makes you teary eyed doesn't it.

Now , and more to the point, they have dispensed any pretense of creating jobs and that sort of thing, it is simply to create more millionaires.

But wait there more! Ken warns us that if we tax the rich they will flee the country...thats right, the uber patriots , Republicans, who if the propaganda is to be believed are the people who love America soooo much more than the common folk.

Ask them to sacrifice for the common good...nada, they are willing to head to a Banana Republic tha live in the greatest country on earth. Interesting.

They can try to wrap a flag around it but their "patriotism" is about the money. Always has been, always will be.


by MRFred on 07/23/2008 06:55:34 AM EST

[ Parent ]
But wait Ken... (none / 0)

If we have to cut taxes on the rich and corporation so they won't leave why have so many of the largest corporations relocated their headquarters (and their taxing authority) outside the U.S. under Bush?

And why do you still support un-American foriegn corporations like Haliburton and insist we give them massive tax breaks and unsupervised no-bid contracts our military depends on for its very survival?  Could it be you and your GOP friends don't give a flying fuck about America and just use patriotism to hide your larceny?

"Patriotism is the last refuge to which a scoundrel clings.

Steal a little and they throw you in jail, steal a lot and they make you king "-

BD, Sweetheart Like You

by ProfRich on 07/23/2008 10:34:39 AM EST

[ Parent ]
quick note (none / 0)
While waiting to take my entourage to lunch. I'm on record numerous times, advocating huge tax breaks, or corporate welfare, or whatever you want to call it, for corporations that create and maintain manufacturing jobs in the U.S.. They should get 2 dollars in tax breaks for every one dollar they pay in salary to manufacturing workers.

by KenTX on 07/23/2008 11:26:08 AM EST

[ Parent ]
Isn't that cute? (none / 0)
KenTX rediscovered we have a progressive tax system.

Let's look at the last time he did this and save us a lot of trouble.

by richardshort2001 on 07/22/2008 09:02:26 AM EST

weird (none / 0)

by richardshort2001 on 07/22/2008 09:04:08 AM EST

[ Parent ]
Why do rich people pay more taxes? (none / 0)

Willie Sutton understood. When asked why he robbed banks, he said, "That's where the money is."

Rich people pay more because they have all the money.

Poor people DO pay taxes - gas, sales, telephone, property taxes through rent, etc.

Gawd, rich people are a bunch of whiners, aren't they?

by MedfordTim on 07/22/2008 10:07:10 AM EST

Thank you (none / 0)
for pointing out that income tax is only one part of the picture.

How about capital gains tax to name another.

People sitting on their fat asses waiting for checks in the mail get taxed at a much lower rate than people who actually work for a living.  And that's a "conservative" value how?

by ihavenobias on 07/22/2008 10:19:42 AM EST

[ Parent ]
facts of life (none / 0)
The Super-Rich are allowed to shelter their wealth from taxes because they're huge campaign contributors, and we don't want to give them incentive to move out of the country. 

The Upper Middle Class is getting murdered by taxes. Nobody cares about them because they don't have enough votes, and they can't move. A lot of UMCs are downsizing, because the consumption lifestyle isn't worth it when there is nothing to show after taxes. When Atlas shrugs, America is screwed.
 
Rich people are coddled because they're rich. We don't want to screw the pooch, like they're doing in France.

France is constructing a socialist’s dreamland.

France’s top personal tax rate is 48 percent, with a VAT tax of nearly 20 percent. So that means French laborers face a combined 68 percent tax rate on consumption and investment. No wonder France has created less than 3 million jobs over the past 20 years, compared to 31 million in the United States. Economic growth in “cowboy capitalist” America has exceeded that of France’s worker paradise by nearly 50 percent.

In a dramatic speech to the European Parliament last summer, British Prime Minister Tony Blair hit the mark when he criticized all Western European economies for their inability to compete on an acceptable global level. Asked Blair, “What type of social model is it that has 20 million unemployed in Europe? Productivity rates falling behind those of the USA? That, on any relative index of a modern economy — skills, R&D, patents, information technology — is going down, not up?”

Financial Times international editor Olaf Gersemann blames French and European unemployment on high minimum-wage requirements and overly strict employment-protection laws. Gersemann, who scathingly criticized Western Europe in his book “Cowboy Capitalism,” says these labor-market regulations have created millions of involuntary unemployed throughout Europe, affecting immigrants in particular. He writes, “Most French, German, and Italian voters simply refuse to accept the necessity of a Thatcher-Reagan style economic revolution.” He notes that per capita income in the U.S. now exceeds that of France by close to 40 percent, with Germany and Italy lagging even further behind.

This explains why investment capital is fleeing France, and the only thing they still produce is wine, cheese, and truffles.

On average, at least one millionaire leaves France every day to take up residence in more wealth-friendly nations, according to a government study.

At a time when France is struggling to stay competitive in an increasingly integrated world, business leaders say the country can't afford to make refugees of some of its most established business families. They include members of the Taittinger champagne empire, the Peugeot auto magnates and leading shareholders of dominant retailers Carrefour and Darty. Also going are members of a new generation of high-tech entrepreneurs.

Socialist leaders and some government officials argue that the rich are merely trying to shirk their social responsibilities by fleeing the country with their millions.

The wealth tax -- officially called the solidarity tax -- is collected on top of income, capital gains, inheritance and social security taxes. It's part of the reason France consistently ranks at the top of Forbes magazine's annual Tax Misery Index -- a global listing of the most heavily taxed nations.

"This tendency to take from the rich and give to the poor which is supposed to solve all the problems in France is ruining the country," said Alain Marchand, who left France six years ago and now has a London-based consulting business that helps relocate French business leaders and entrepreneurs in England and other countries. "That's an incredibly stupid and narrow-minded vision of economic life."


Eric Pinchet, author of a French tax guide, estimates the wealth tax earns the government about $2.6 billion a year but has cost the country more than $125 billion in capital flight since 1998.

In France, employers are required to pay social security taxes equal to 48 percent of each employee's salary. Labor laws make it difficult and costly to fire incompetent workers.

by KenTX on 07/22/2008 11:37:47 AM EST

[ Parent ]
have you checked the value of the euro (none / 0)
vs. the dollar lately...

by chrisandyasemin on 07/22/2008 02:54:50 PM EST

[ Parent ]
(Don't want to seem harsh)... (none / 0)

Ssshhhh....I'll type this quietly, maybe no one will notice...

Your links are the same ones you used two years ago. Here's a link to some updated info , and just for you, it's from the Economist.

And while you sing their "Po' Rich Boy Blues". Forbes says - they ain't doin' too bad:

"Still, one group is prospering. France's 16 billionaires are worth a combined $114 billion as of March 2008, up from $110 billion a year ago. Their average net worth is an impressive $8.2 billion, more than double the average net worth of $3.9 billion for the world's billionaires overall. Two of the 16 are among the world's top 20 richest billionaires."

Ssssst! Only TWO?? Damn, that must make those Frenchies feel inadequate as hell, huh?

C'mon, Ken. France bashing is soooooo 2004...

by MedfordTim on 07/22/2008 04:49:15 PM EST

[ Parent ]
Ou La! La! (none / 0)

 

I was waiting for him to drag out the " gasp" France "gasp", posts. It's predictable, like the seasons..unfortunately unlike the seasons, they never change.

First some WSJ article about taxes... then old Limbaugh graphs and , the pièce de résistance, France!

Oh I almost forgot the ever so funny beret piece he lifted from Coulter or was that Limbaugh?



 

 

by MRFred on 07/22/2008 07:42:21 PM EST

[ Parent ]
AND? (none / 0)
What is the point of the post?  That I should feel sorry for rich people?  That I should vote for McCain to keep America prosperous?  The Republicans haven't done anything but destroy America for eight years.  Time for change.

by desertpear on 07/22/2008 05:49:12 PM EST

The thing is (none / 0)
The top 1% does just fine regardless of who is president. But the poor and middle class do much better with a Dem in office.

by ihavenobias on 07/22/2008 08:40:38 PM EST

[ Parent ]
Who are the people who pay income taxes? | 35 comments (35 topical, 0 hidden)
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