Week 8:The Self-Destruction of the 1 Percent - 5 views
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Eli Melrod on 16 Oct 12I get so worked up when super-wealthy people act like they are somehow being persecuted when the Democrats asked them to "pay their fair share." I think this op-ed piece does a great job of explaining the frustration with the current socioeconomic divide. The author writes that "It is no accident that in America today the gap between the very rich and everyone else is wider than at any time since the Gilded Age." Although we can sit around and pretend that people "need to learn" from the rich. In reality, a of government policies are making it much harder to go from poor to rich, or even middle class. As the author describes the holes in the current American system, "Exhibit A is the bipartisan, $700 billion rescue of Wall Street in 2008. Exhibit B is the crony recovery. The economists Emmanuel Saez and Thomas Piketty found that 93 percent of the income gains from the 2009-10 recovery went to the top 1 percent of taxpayers. The top 0.01 percent captured 37 percent of these additional earnings, gaining an average of $4.2 million per household." This article doesn't blame Romney or Obama, it just explains why people are starting to have problems with the idea of the "1%." I personally don't think the outcry is against the actual members of the 1%, but rather agains the policies that it make socioeconomic inequality greater.
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Cameron G on 16 Oct 12I think there are some reasonable points to this claim, but has anyone ever considered that the reason the divide is growing is that maybe some middle class people are rising up the economic ladder. The number of millionaires in the United States is the highest it has ever been, so why is this bad. The statistic of the growing gap can be twisted so that it appears that the policies are bad, when in reality they could have some positive qualities. Aren't policies that allow for people to move up in the world good?
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Eli Melrod on 17 Oct 12The number of millionaires may be the highest in history, but the percentage of Americans below the poverty line is 15%; the percentage of Americans that don't have a secure food source is 11%. So, great we have more millionaires, but also a lot more people that are in poverty or don't have enough food to eat on a consistent basis. If we were to tax the rich a higher rate, we coud have a system that lets fewer people slip through the cracks. Like this article mentions, rich people's kids go to private school and get first rate educations, while poor kids go to public schools with smaller and smaller budgets every year; this cycle stagnates social mobility. The rich get educated and get good jobs, while the poor go to failing public schools and receive second rate educations and are stuck in second rate jobs. In California, we have a proposition on the ballot that would raise the income tax on people making over $250,000 a year to provide more money for education. That kind of tax policy makes a lot of sense to me, if we look at the cycle of social immobility caused by education that I previously mentioned. I personally care much more about how many people are in poverty than how many millionaires we have.
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Eli Melrod on 17 Oct 12here's another article that isn't an op-ed piece about the overall economic impact of income inequality: http://www.nytimes.com/2012/10/17/business/economy/income-inequality-may-take-toll-on-growth.html?ref=global-home This makes the income inequality situation not just a problem of more poverty, but also an overall economic problem. "The concentration of income in the hands of the rich might not just mean a more unequal society, economists believe. It might mean less stable economic expansions and sluggish growth."
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John West on 20 Oct 12I agree with both of you in the sense that more millionaires would be a positive thing for the US, if they didn't correlate with a greater number of people in poverty. The millionaire statistic, without looking at what it means on the other end of the spectrum, is misleading. Cameron, I think your point about more middle class "climbing the ladder" sounds reasonable, but simply doesn't seem to be the way things play out in the US. The growing numbers of those in poverty that Eli mentions is meaningful alongside the millionaire numbers because it suggests cause and effect. Eli, I think the non-op-ed piece you posted above makes a really good companion to the original article. It demonstrates the "extractive" capitalism of the Venice article in really clear terms.
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mabel taylor on 21 Oct 12I agree that it is hard to appreciate the economic reality of the US without recognizing both the minority of the extremely wealthy and the growing number of people living in poverty. Only looking at one demographic paints an inaccurate portrait of the American people and economy; when we only talk about millionaires, policies will be made around the assumption that government-sanctioned aid and support is unnecessary or even unrealistic, when we only talk about lower-class people, solving large-scale socioeconomic issues is inherently difficult and going off of liberal taxation viewpoints, diminishing the economic divide is puzzling. Your point, Eli, about the systematic nature of these problems is really poignant and I whole-heartedly agree. I also think the distinction you make about how great poverty is not only a problem for poor people is vastly important to comprehend.
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Jonah Schacter on 21 Oct 12It is funny to think that the rich would not just accept paying higher income tax. There are some in the top one percent like Warren Buffet or Bill Gates that are willing to pay the higher tax. To me if you were rich what difference does it make to pay more, you already have so much money. I think a bigger problem could actually come from the 99% in the fact that it is up to the individual to take opportunities that come to them or they find to get ahead in life. I know people that have been looking for jobs, but not putting the effort in to actually get one, then they go complain about all of these issues brought up in the article when they are their own problem.
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cody s on 21 Oct 12I think that what Mr. Potepan said in the talk really applies here. The idea is that when money is mobile, the economy is flourishing, but once the money gets locked up in the super-rich's bank accounts it doesn't help anyone because it's not being invested. It's always interesting to see historical examples of theories like these, and the thing about Venice seems like it illustrates Mr. Potepan's point well.
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Anna Schutte on 25 Oct 12I agree with Cody that the point of the article is that successful states are those that give everyone access to economic opportunity and that inclusiveness as opposed to exclusiveness makes for a more prosperous country. The "book of gold" is a powerful image for the special access and privilege the elite had in Venice that continues today in access to better education tax breaks, etc. That access is something people don't want to give up. The African-American president at Brown who didn't want to give up legacy at admissions, since she had a granddaughter shows how once you have privilege, you don't want to let it go.