Saturday, June 9, 2012
Robert Reich: Why taxes need to be raised on the rich
Raising taxes on the affluent is a no brainer. Most of these folks live on investments in the stock market and that is not the engine that drives jobs.
After world War 2 income tax on the most affluent Americans was 91 per cent. It was was then dropped to 70 pr cent under Kennedy and 50 per cent under Reagan. Reagan lowered it to 28 per cent in his second term. Clinton increased the rate to nearly 40 per cent and Bush dropped it to 35 per cent.
Bill Gates suggested that raising the tax rate to 50 per cent for top earning Americans. This would help with deficit reduction, fund another economic stimulus and curtail the flow of wealth form the middle calls to the most affluent Americans.
Unequal income in a country in measured by the GINI coefficient. the CIA indicates the UD GINI index. was .486 in the late 2000s. As the index approaches .50, the potential for social instability increases.
This may explain both the Tea Party and OWS movements.
The Republicans can put their head in the sand on taxes for higher earning Americans, but social instability will be the eventual outcome.
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