There is an inherent tension — and obscenity — in the wildly divergent fortunes of the rich and the poor in this country, especially among our children. The growing imbalance of both wealth and opportunity cannot be sustained. Something has to give.That is the final paragraph of Billionaires' Row and Welfare Lines, the column for Saturday's New York Times by Charles M. Blow.
It is chock full of statistics. Part of the title comes from this paragraph"
A report last week in The New York Times says that developers are turning 57th Street in Manhattan into “Billionaires’ Row,” with apartments selling for north of $90 million each.Ponder that for a moment.
Ponder as well that there are now 442 billionaires in the United States.
Ponder also this:
According to First Focus, a bipartisan advocacy organization focusing on child and family issues: “The 1,168,354 homeless students enrolled by U.S. preschools and K-12 schools in the 2011-2012 school year is the highest number on record, and a 10 percent increase over the previous school year. The number of homeless children in public schools has increased 72 percent since the beginning of the recession.”Something has to give.
And the answer is simple.
Raise taxes on the wealthy.
Let me explore this further.
Remove the cap on income on which Social Security taxes are applied and there is no problem funding the program beyond any foreseeable future.
Change the Medicare tax to apply it to all income, not just wages and related, and the problem of funding that largely disappears, while the rest is accounted for by controlling costs better.
But most of all, get rid of the carried interest exception, and change the rules on capital gains so that the lower rate applies only to the original investor of securities, not to speculators in the after market. And do not apply the full capital gains tax break to those whose "original investment" is as the result of stock options as a form of compensation.
Oh, and get rid of some of the exemptions for the wealthy and corporations, and raise the rates on the wealthy, so that incomes above some amount are taxed much more heavily - gee, how about total income regardless of the source above the $90 million cited as the average cost of those apartments at a rate of say 60%?
The billionaires will still have way too much money, but the government will be able to lots of things this country really needs
- rebuild our infrastructure, including public schools
- fully fund all elements of the social safety net for those who have been seriously hurt by the ongoing great recession - that includes SNAP, Medicaid, Housing (think of all those homeless students) and many more things.
And while we are at it, lower the tax rates on lower incomes, so those people at the lower part of the income pyramid will have more disposable income, which they will spend, which will therefore create more demand of basic goods and services, which therefore will create more jobs, which of course will result in more revenue for government - at the state and local level as well as for the federal government.
Unless and until we change how our economy and tax system are currently structured, shifting ever more wealth to the already wealthy, starving governments of the funds necessary to provide essential services, and pushing ever increasing numbers of Americans further down the economic scale, we are headed for a cataclysm that will not be pretty - and some on the right who have fought against sensible gun control may come to regret that decision when they become the targets of the disillusioned masses for whom there no longer is an American Dream, only the ongoing nightmare of increasing economic inequality and desperation.
Something has to give.
What will it be?