America's rich get richer
"...Should any political party attempt to abolish social security,
unemployment insurance, and eliminate labor laws and farm programs, you
would not hear of that party again in our political history. There is a
tiny splinter group, of course, that believes you can do these things.
Among them are H.L. Hunt...and a few other Texas oil millionaires, and an
occasional politician or businessman from other areas. Their number is
negligible and they are stupid."
-- President Dwight D. Eisenhower, in a letter to his brother Edgar, Nov. 8,
1954
"Estimated ratio this year of the U.S. defense budget to that of the
rest of the world combined: 1:1"
-- Harper's Index, April 2006
U.S. military spending in 2010 was $698 billion, the highest on
earth (China was second with $119 billion, the United Kingdom,
third with $59.6 billion)."
-- AP story (citing Stockholm
International Peace Research
Institute) in Seattle Times, April 11, 2011
Since 2000, U.S. defense spending has gone up 81% -- not counting
the Iraq and Afghanistan wars.
-- Bill Maher on "Real Time with Bill
Maher" April 2011
Wells Fargo, At&T, Verizon, General Electric, IBM, Exxon Mobile and Boeing together got tax breaks totaling just under $70 billion between 2008 and 2010, the Seattle Times reported on Feb. 23, 2012.
Some superwealthy lashed out at protests against the greed of the richest 1% -- saying the protesters were imbeciles and calling rules that require companies to disclose the ratio of pay between CEOs and employees "insane," according to the Dec. 21, 2011 Seattle Times, which noted that average U.S. household income increased 62% between 1969 and 2007 -- but income for the top 1% rose more than 300%.
Compensation in fiscal year 2010 for American CEOs increased by a median 27%, according to the Los Angeles Times. CEOs from the S&P 500 took a median 36.5% increase in compensation, the Times said, citing the ninth annual report from the research group GMI.
Paul Krugman noted in November 2011 that all American redistribution of income away from the bottom 80% has gone to the highest-income 1% -- and that a report looking only through 2005 found that almost two-thirds of the rising share of top 1% income went to the top 0.1% (the richests one-thousandth), who saw their income rise more than 400% from 1979 to 2005.
Krugman added that the top 0.1% is not heroic entrepreneurs -- instead, corporate executives, executives in nonfinancial companies (Wall Street executives), lawyers and real estate kings.
"'We are the 99 percent' is a clear message. It is unfair and, in fact, digusting that the American political economy is run for the benefit of a plutocracy. I don't see how that can be misunderstood," said Todd Gitlin (president of the former Students for a Democratic Society in the mid-1960s) at the Occupy Wall Street protest Oct. 5, 2011, according to the Oct. 10 Seattle Times.
Fifty percent of all American workers earned less than $26,364 in 2010, fewer jobs were available and overall pay was trending downward, except for the wealthiest, with the number of people making $1 million or more rising 18 percent from 2009, according to an Oct. 21, 2011, Seattle Times article citing Social Security Administration data.
CEO pay has multiplied, with the median value of salaries, bonuses and incentives for the CEOs of 350 huge American corporations rising 11% in 2010 to $9.3 million, according to a Wall Street Journal study that was cited by the Cascadia Weekly on Aug. 31, 2011. Bonuses rose 19.7% too -- and these increases do not include stock-option rewards.
The top 0.1% of U.S. earners grabbed more than 10% of U.S. personal income (including capital gains), and the top 1% grabbed more than 20% (in 2008, the lastest year figures are available), the June 21, 2011, Seattle Times reported. The big earners are executives and managers (even in boring areas like the milk business). Since 1970, executive pay has increased 430%, far above a 250% increase U.S. corporate profits -- and wildly above the 26% increase in wages for ordinary workers.
A dozen U.S. businesses -- with profits of $171 billion over the past three years -- paid a NEGATIVE $2.5 billion in federal taxes. Boeing had $9.7 billion in profts over this 2008-10 period and had a total federal tax rate of -1.8 percent. In the decade ending in 21010, Boeing's profits were $29 billion, yet it paid MINUS $948 million in federal taxes, according to the July 3, 2011 Seattle Times' Danny Westneat (citing a Citizens for Tax Justice study).
The average federal income tax rate for the 400 most super rich (average income of $345 million in 2007, the most recent year for IRS data) was 17%; it had been as high as 26% in 1992, according to an Associated Press story on Page 1 of the April 18, 2011, Seattle Times.
The richest 1 tenth of 1 percent of Americans is only 13,000 households and earned more than 11 percent of the nation's total 2007 income, according to columnist Bob Herbert in the Sept. 15, 2010, Seattle Times. The top 1 percent of earners has seen its share of America's income increase from 9 percent in the 1970s to 10 percent in the 1980s, to 19 percent in the late 1990s -- and to 23 percent in 2007, the most recent year complete data is available.
The super-rich get super-richer, according to the Aug. 23, 2010 New Yorker, which reported that between 2002 and 2007, the top one percent of rich Americans have seen their share of the national income double. And, within that group, the top 0.1 percent have seen their share of national income triple -- by themselves, they earn as much as the bottom 120 million people in America.
The top 1% of Americans saw their real income rise 700% between 1980 and 2007 while the real income of the median family increased only 22% -- a third of its growth the previous 27 years, according to an August 2009 New York Times column by Paul Krugman, Nobel Prize winner.
By 2006, income was more concentrated for the rich than at any time since the beginning of the great depression -- but the current recession is beginning to make them a bit less rich, the New York Times reported in late August of 2009. But they were still rich. (According to the IRS, in the late 70s, each of the highest-earning households -- the top 1/10,000 -- earned over $2 million, adjusted for inflation, while in 2007 they each made over $11.5 million.)
By 2004, the top 1 percent of Americans took 16% of national income -- whereas in Japan, it took a little over 8% and Sweden, it took just under 6%, according to TooMuchOnline.org.
One percent of the world's adults own 40% of the world's wealth -- and most of the richest people live in North America, Europe and Asia-Pacific nations, according to a U.N. University report. (The average adult wealth is $181,000 in Japan and $144,000 in the U.S. as compared, for example, to Indonesia with $1,400.)
The wealthiest 20% of households own 50% of U.S. wealth the Census Bureau showed in 2002 -- that's up from 44 percent in 1973.
For the bottom 20%, their share is now only 3.5%, down from 4.2% in 1973.
Now, 10% own 80% of the nation's property -- and 13,000 of its richest families have net worth equal to the 20 million poorest families.
By mid-2010, the pre-Bush budget surplus of $5.6 trillion had become a debt of $13 trillion, according to http://www.brillig.com/debt_clock (as of 3.25.10) -- see the clock for the current debt total: National debt clock.
The richest 1% of Americans now own 37% of the wealth -- more than the poorest 90%.
16 million Americans now live in deep poverty (annual income less than $9,903) -- a grown of 26% from 2000 to 2005, according to a McClatchy Newspapers analysis of 2005 census figures.
The percent of American poor in extreme poverty has grown from 29.9% in 1975 to 43.1% in 2005.
Over the last 20 years, America has had the highest or nearly highest poverty rates for individual adults, families and children among 31 developed countries (Luxembourg Income Study).
Over its course, the 2001 tax cut gave almost 40 percent of the cut to the richest 1%.
The added tax breaks of 2003 similarly benefited the rich (savings for those with income under $10,000 will be $5, with 8 million low-income taxpayers not receiving anything and another 6.5 million low-income taxpayers not receiving a $400 child-care tax credit -- which excludes 12 million children).
The Seattle P-I reported that under the tax cuts, on their 2004 taxes, President Bush saved over $29,000 and Vice President Cheney, $81,336.
For those with incomes over $1 million, tax savings was $88,873
Prior to that, the tax burden for the richest 1% increased by 48% between 1979 and 1997 -- but their income grew 157% (to an average of $677,900 -- up from $263,700 in 1979).
Congressional Budget Office statistics show that adjusted for inflation, income of American families in the middle rose from $41,900 in 1979 to $45,100 in 1997 (a 9% increase) while the income of families in the top 1% of income rose from $420,200 in 1979 to $1.016 million in 1997 (a 140% increase).
That means that in 1979, the richest 1% of families made 10 times that of the average family but by 1997 were making 23 times the amount -- and the gap is still growing.
Large-company CEOs, on average, earn 500 times more than the average worker, the Seattle P-I reported Feb. 1, 2007 -- in 1980, CEO salaries were only 42 times greater.
Now, the nation's 10 highest paid CEOs make $154 million a year as opposed to the $3.5 million made by the top 10 in 1981.
In 1974, the average CEO made 34 times as much as a production or non-supervisor worker.
In 1990, it was 96 times as much.
In 2000, it was 458 times as much.
The average CEO of a major corporation makes $13.1 million a year in compensation (about $36,000 a day).
An estimated 61 percent of U.S. corporations paid no federal taxes between 1996 and 2000.
Worker pay in the year 2000 was lower, inflation-adjusted, than in 1980 while CEO pay was 10 times higher (workers averaged $28,900 in 1980 and $28,597 -- inflation-adjusted in 2000)
CEOs averaged $1.3 million in 1980 (in year 2000 dollars) and $13.1 million in 2000.
The 2001 income tax booklet shows that half the federal income for Fiscal Year 2000 came from personal income tax. Corporations provided just 10%.
According to Harpers (July 2004) 61 percent of U.S. corporations paid no federal taxes between 1996 and 2000.
In October 2004, Congress passed and President Bush [later signed] a tax-cut bill of $136 billion for corporations, the Seattle P-I reported Oct. 12, 2004.
The same day, the P-I reported that one in five jobs in America earns poverty-level wages, meaning 39 million Americans earn barely enough to cover basic needs.
Since 2001:
1.3 more million Americans are below the poverty line
1.4 million more people are without health insurance
2 million jobs have been lost in the private sector
The budget surplus of $5.6 trillion has become a deficit of $400 billion
Economic growth has been 1%, the lowest of any presidency in 50 years
Value of stocks held by Americans dropped $4.5 trillion, equal to a 30 percent drop in the value of IRAs and 401(k) plans
Some Social Security truths
$2 trillion has been transferred from Social Security taxes to the non-Social Security budget.
The amount by which total Social Security contributions since 1983 exceed total benefit payments since then: $999 billion -- (Harpers said in July 2004, citing Social Security Administration in Baltimore)
The Congressional Budget Office estimates that the Social Security trust fund will not run out until 2052, but even after that Social Security revenues will cover 81% of the promised benefits.
The Congressional Budget Office found that extending SS into the 22nd Century with no change in benefits will require additional revenues that amount to only 0.54% of GDP -- that's less than 3% of federal spending.
According to columnist Paul Krugman (March 13, 2005 -- Seattle P-I), Social Security officials have been partisan and deputy commissioner James Lockhard has been giving misinformation at pro-privatization rallies. Also, the Social Security Administration has begun to slant the information provided in the information it gives the public.
An example of the bias is the March 24, 2005, announcement by the trustees reported in the Seattle P-I that suddenly the system will now go broke in 2041 -- prompting Nevada Sen. Harry Reid to say that the SS crisis exists only in the minds of the Republicans.
Krugman also says that the proposal would harm the middle class, with workers of average pay ($37,000) facing cuts of 10% when they retire in 2075, workers earning the equivalent of $58,000 today being cut by 13% but million income Americans would see cuts of only 1%.
The AARP Bulletin in April 2005 listed 9 ways other than privatization to tune up Social Security: 1) Raise the cap to allow those making over $90,000 to be taxed; 2) Increase payroll tax rate slightly; 3) Raise the taxation on SS benefits; 4) Preserve some estate tax and dedicate it to SS; 5) Make SS universal (so that the 30% of state and local workers currently outside the system are inside; 6) Invest some of the SS trust in indexed funds; 7) Adjust the Cost of Living Adjustment 8) Raise retirement age; 9) Index benefits to prices, not wages.
Sources: "Corporations, Taxes: Let the debate begin," Seattle
Times, Feb. 23,2012, A3; "Superwealthy mobilize in effort to mute attacks
on 1%,"
Seattle Times, Dec. 21, 2011, A1, A8; "CEO pay takes a big jump in 2010,"
Bellingham Herald,
Dec. 16, 2011, B6; "Democacry and American oligarchs," Paul Krugman,
Seattle Times, Nov. 5, 2011, A section; "Income
gap still widening in U.S.," Seattle Times, Oct. 21, 2011, A2; "Wall
Street protest draws critique by veteran activisits,"
Seattle Times, Oct. 10, 2011, A2; "Labor Day: This year we need portest
marches more than
parades," Robert Reich, Cascadia Weekly, Aug. 31, 2011, p. 8; "Wartime Tax
rate:
Less than zero," Seattle Times,
July 3, 2011, pp. B1, 7; "Executive pay drives increasing wage gap," The
Seattle Times,
June, 21, 2011, p. A3; "Economy fails working Americans," Bob Herbert, Seattle
Times, Sept. 15, 2010; "Soak the very, very rich," James Surowieki, New
Yorker,
Aug. 16 & 23, 2010; "Recovery: Why our CEOs Don't Give a Hoot,"
TooMuchOnline.org, October. 14, 2010; "NIght of the living Reaganites,"
Paul Krugman (New York Times columnist), Seattle
Times, Aug. 25, 2009, p. A11; "Reversal of fortunes as rich
become poorer," Seattle Times (using a New York Times story by David
Leonhardt and Geraldine Fabrikant), Aug.
21, 2009, p. A1, A11; "Poverty at record high levels," (Tony Pugh,
McClatchy),
Bellingham Herald, Feb. 25,2007, p. 1, 11; "Bush targets extravagant CEO
salaries," (Ben Feller, AP),
Seattle P-I, Feb. 1, 2007, p. E1, 6; "1% own 40% of world wealth, U.N.
says," Seattle P-I,
Dec. 6, 2006, p. C3; "They come to bury Social Security," Paul Krugman,
Seattle P-I, Dec. 8, 2004; Corporation and poverty stories, Seattle P-I,
Oct.
12, 2004; "America's income gap grows; rich get richer," Seattle P-I,
Aug. 17, 2004; Harpers Index, July 2004; AP story in Seattle P-I, April
14, 2004; Jack Z. Smith
(Fort Worth Star-Telegram), June 7, 2003 in
Bellingham Herald, p. A11; Lewis Lapham, Harpers, January 2003, p. 9;
David Broder (syndicated columnist), Seattle P-I, Oct. 13,
2002; Paul Krugman (New York Times columnist), Seattle P-I,
Jan. 13, 2001 p. D7; Geneva Overholser, columnist, Seattle P-I,
6/01/01; Nation,
Oct. 27, 1997; Interfaith Peace Makers of Edina brochure; Seattle PI
(Curt Anderson, AP), 4/9/02; 2001 1040 tax boolet. Ryan
J. Donmeyer, Seattle P-I, Jan. 8, 2003; AP chart, Seattle P-I,
Jan. 8, 2003, p. A7
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