Hurting financially? Not if you're a CEO
By GARY BAUMGARTEN
The haves and the haves nots. That's what this country is coming to.
If you don't have a crystal ball about what that all means, don't look forward, Look back. Back at what became of other nations whose middle class eroded.
The quality of life, when there is a shrinking middle class and growing poverty, declines for everyone. Everyone except the top elite.
Those who have an abundance of money gave an obvious hedge against poverty.
They can afford security. They can afford to travel to luxury destinations. And they live together in communities, creating a sufficient collective tax base, so when they call the cops, the police actually come to protect them. Unlike communities that are struggling and laying off police.
In the United States, we've not had to come to terms with this kind of an environment. Because the middle class was well fed and had enough discretionary income to be able to thumb its nose at the less fortunate among us. Folks many viewed as lazy. Or substance abusers. Or, whatever.
That was before the middle class became "them." Now there is an increasing awareness, even among those still gainfully employed, about the suffering of others. Because the new "others" are friends and family members - previously hard-working individuals - for whom the system is now failing.
It brings new perspective to the middle class, as they see homes foreclosed or people stuck in houses they can no longer afford to keep but can afford even less to sell.
Which leads me to two articles. One in the Wall Street Journal. The other, a CNN Money piece.
The Wall Street Journal story tells us that the highest paid CEOs in this nation arereally not suffering like the rest of us mortal human beings.While America suffered through 2010, their value, the Journal tells us, increased. Significantly.
Worse yet, a number of those sufficiently well-off folks, (ready for this?) paid NO federal income tax.
That's right. None. Zero. Zilch.
According to CNN Money, 18,000 households that brought in more than half-a-million dollars last year were exempted from paying income tax. (Four-thousand of those made more than $1 million!)
Of course, we all look at life through a prism of self interest. But the very rich had better look into their crystal balls as well.
If they can't afford one, I'll provide them a glimpse. As a public service.
If this turning our back on the less fortunate continues, and the unemployment rate (which is arguably much higher than what is reported) continues to rise, the worker bees among us won't have money in their pockets to pay for the goods and services that the rich sell. Which means, eventually, the economy will catch up with them as well.
And if the gap becomes too great, if too many people who considered themselves to be middle class find themselves among the poor, there will be discontent. And, a resulting increase in crime as people try to figure out ways of just surviving.
When there are massive demonstrations on the streets of the United States about the economy, the kind of demonstrations we've seen in Europe and the kind we've seen in the Middle East, those 18,000 households making more than $500,000 a year but not paying taxes will take notice. Because their way of life will become threatened as well.
But by then, it may be too late.
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Julie Morse
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Comments
It was also reported that they had 300 "volunteers" working for free. So they couldn't have taken some of that $2 million and paid their workers?
Katz dropped a reported $600,000 to start Paltalk. Want to bet he doesn't live in the poor part of town and drive a 10 year old Chevy? I'll bet even you don't qualify as a working stiff. You just like to play one on the internet.
I sure wish there was more up to date figures available. Would you care to post them Gary?
So, if I worked for GE would you assume I hadn't paid any taxes?
For all you know - not that it's particularly any of your business - I am one of the 300 volunteers. Or maybe I live in a mansion in the Hamptons. What difference would it make? Either what I wrote resonates or it doesn't.
As for the company's worth, why don't you ask Mr. Katz. I'm not an owner nor have I ever looked at, or asked to look at, the company's bank account. If it ever goes public, you can buy a share and demand full disclosure.
When you're willing to invest in me, I'll be happy to open my bank account to you as well.
A Former Upper Middle Class Person
so america lurches from crisis to crisis, some small, some near-death, and a nation of virgin resources and natural defenses finds itself in debt to china, which has nothing but planning and discipline, and at war far away to steal other people's resources.
still we hear what a wonderful place is america! which it is, for bandits in big suits.
When this country was attacked last decade and our leaders launched two costly wars which they funded through supplemental spending (to the tune of $100B a year) and did not raise taxes to pay for them, but instead lowered taxes, who in the middle class stood up and said this was wrong?
When the President at the time told us the only sacrifice we should make vis-a-vis the wars was that we should shop more, who in the middle class stood up and said that was wrong?
When Congress shelved all the banking regulations, which was "bad for business", that eventually led to CDOs and the near collapse of the economy who amongst the middle class stood up and said that was wrong?
How many in the middle class took out 2nd mortgages to fund vacations and purchases of expensive toys?
How many in the middle class lived outside their means, took mortgages with 5 year ARMS without reading the contracts or having them explained to them and are now foreclosing because they can't afford the balloons.
Who in the middle class, particularly the boomers, stood up when Congress passed Medicare Part D in 2003, which is projected to cost the nation $1T (yes, a T) over ten years?
When the Supreme Court ruled that a corporation was the equivalent of a human being and allowed to have the same free speech, including unlimited political ads, who in the middle class complained that this would give the wealthy an unfair advantage at influencing legislation?
As GOP governors across the country lay the blame for their state deficits on teachers, teachers for God's sake, who amongst the middle class stood up and asked why, at the same time they are cutting education funding the governors of Wisconsin and Pennsylvania and Ohio are making tax concessions to corporations? Where is the shared suffering? Who thinks we can dumb our way out of a recession and into the future?
Yeah, the rich are evil and will exploit any opportunity presented and tilt the balance in their favor when ever they can, how do you think they became the rich, through fair practices? But before we hang them by their expensive Trump clothing line petards lets acknowledge that we are the idiots who voted in the idiots to lead us and allow the rich to exploit everyone.
R, Erica
For those of you unfamiliar with Erica's writings, I urge you to read her OS blog. She is a fantastic writer and her subject matter, caring for a mother with Alzheimer's and dealing with the system, gives us tremendous insight into an untenable situation - another issue to which we, as a society, fail to respond properly.
It's time we set our priorities. The budget debate gives us opportunity to influence the direction this nation will take. But the only ones whose voices seem to get attention are the "fiscal conservatives" who repeat the "cut spending" mantra - leaving in their wake the shattered remains of social programs. The question that needs to be asked is, which programs are escaping their ax. And why.
Does it appear that Wall Street firms were properly regulated from 2002 to 2008? Remember the budget SURPLUS President Clinton left us with in 2002? What were the tax rates on the wealthy & corporations in 2001? General Electric Inc. reportedly paid no taxes on its huge profits last year thanks to write-offs, GE has a multi-billion dollar contract in Iraq, does this make you suspicious?
NOW, it appears, the Republicans have changed their minds about budget deficits, stating the deficit must be cut. Yes! Let’s end 2 wars and reinstate the 2001 tax rates. Will the Republicans consider raising taxes back up to 2001 tax rates on those making more than $250,000? Do they want to, say, cut the Defense Dept. budget by 10%?
I wonder about the upper echelons of the GOP, they seem to have NOT learned from their mistakes, and, it appears, they would very much like to repeat their mistakes once again, say, from 2012 to 2016 and further harm our nation. Will they be rude at congressional town hall meetings this summer, subverting democratic debate and shouting out their worries about the deficit? Should we then play the tape of Cheney saying not to worry about the deficit? What is patriotic?