When Larry Summers says so, you know it’s bad:
Inequality has emerged as a major issue in the US and beyond. A generation ago it could reasonably have been asserted that the overall growth rate of the economy was the main influence on the growth in middle-class incomes and progress in reducing poverty. This is no longer a plausible claim.
The share of income going to the top 1 per cent of earners has increased sharply. A rising share of output is going to profits. Real wages are stagnant. Family incomes have not risen as fast as productivity. The cumulative effect of all these developments is that the US may well be on the way to becoming a Downton Abbey economy. It is very likely that these issues will be with us long after the cyclical conditions have normalised and budget deficits have at last been addressed.
Well, Larry, if you and your ilk hadn’t been pushing deficit reduction, it wouldn’t be anywhere near as bad. So fuck you.
[…] It is not enough to identify policies that reduce inequality. To be effective they must also raise the incomes of the middle class and the poor. Tax reform has a major role to play. The current tax code is so badly designed that it is very likely to be having the effect of reducing economic growth. It also allows the rich to shield a far greater proportion of their income from taxation than the poor. For example, last year’s increase in the stock market represented an increase in wealth of about $6tn, of which the lion’s share went to the very wealthy.
It is unlikely that the government will collect as much as 10 per cent of this figure. That is because of a host of policies that favour the rich, such as the capital gains exemption, the ability to defer tax on unrealised capital gains, and the fact that gains on assets passed on at death are not taxed at all. Similarly, the corporate tax system allows value to flow through it like a sieve. The ratio of corporate tax collections to the market value of US corporations is near a record low. The estate tax can be more or less avoided with sophisticated planning.
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Closing loopholes that only the wealthy can enjoy would enable taxes to be cut elsewhere. Measures such as the earned income tax credit can raise the incomes of the poor and middle class by more than they cost the Treasury, because they give people incentives to work and save.
It is ironic that those who profess the most enthusiasm for market forces are least enthusiastic about curbing tax benefits for the wealthy. Sooner or later inequality will have to be addressed. Much better that it be done by letting free markets operate and then working to improve the result. Policies that aim instead to thwart market forces rarely work, and usually fall victim to the law of unintended consequences.
Now that I think of it, fuck you twice, Larry. We know which side you were on.
On one side we have Warren, Sanders, Grayson and a few others. On the other side is every other politician. Austerity and deficit reduction are the same things. What we need to fix this mess is a Graduated (Progressive) Income Tax System. Top earners should pay no less than 70% and anybody making $36,000 a year or less should pay no income tax at all. Everybody else would contribute on a sliding scale starting at 10%. We could retire our debt within 5 years. (Do the math.) What do you suppose Hillary would think of that idea?
I couldn’t get past the “deficits have at last been addressed…” BS – yeah Larry on the backs of the bottom half thanks to you – fucktard – people are dead because of you.
And this one – “Family incomes have not risen as fast as productivity” No Larry, family incomes haven’t risen AT ALL – they’ve dropped. Asswipe.
I confess to being a bit confused. At the top of the article it says “by Larry Summers”. At the end of the article it says “…The writer is Charles W Eliot university professor at Harvard and a former US Treasury secretary…”.
So… was Prof. Eliot acting as Summers’ secretary? Does Summers actually agree with what was written here? I tend to doubt it.
Couple other observations – “…Inequality has emerged as a major issue in the US and beyond…”
Well, maybe ‘beyond’. In the good old U.S. of A., the media will be quick to point out, via their marvelous array of Congressional and Board level Corporate contacts, that anybody who whines about “inequality” here is just a “loser”. Period.
Oh, the hoi polloi may talk about ‘inequality’, but nobody who is anybody ever will.
“…To be effective they must also raise the incomes of the middle class and the poor…”
Hardy har har har. You know when the incomes of the middle class and poor will get raised? The same day Satan decides to get measured for a really nice overcoat.
To get a raise, two things must happen: Management must actually have some inkling of a conscience, and the working/middle class has to have some inkling of clout via a political association or party which actually prefers to represent the interests of working/middle class people as opposed to the interests of Corporations and their management.
Neither of those conditions holds here.
At the top of the article it says “by Larry Summers”. At the end of the article it says “…The writer is Charles W Eliot university professor at Harvard and a former US Treasury secretary…”.
So… was Prof. Eliot acting as Summers’ secretary?
Summers’ official academic title is “Charles W Eliot university professor at Harvard”.
His unofficial title at my house is “shithead.”
Izquierdo – Thank you for the clarification. I appreciate that.
Though sometimes, don’t you have to use Roman numerals to tell them apart? Like, what would Timothy Geithner be called? Wouldn’t he also be “shithead”? Just maybe Shithead II?