6th Street

While we are at it, we should probably curtail the lavish salaries of actors, pop stars and athletes, whose income also gets way out of hand due to an out of sync supply and demand curve based on supply of one (that person).

I strongly disagree with putting caps on how much money a person can make.

The arguments made about tax rates in the 50's and American prosperity are as asinine as the those made about the Clinton tax rates and the boom we enjoyed in the 90's. Small minded people argue that America prospered under that structure as though the taxes were occurring in a vacuum. In reality the economy was riding the tech bubble. Likewise, American factories and corporations of the 50's were still enjoying the benefits of being the only game in town as Europe was still recovering from the devastation of WWII while dealing with the Cold War and Iron Curtain, and the Asian economies and production were virtually nonexistent compared to what we know today.

Taxation does not lead to prosperity. Get that through your skulls. There is no point in history that you can point to economic growth and high taxation running hand in hand without some overwhelming circumstances intervening in the normal course of things. This isn't the 50's and this certainly isnt the 90's. We are a consumer nation that doesn't build and export things in any semblance of what once was. If you want this country's economy to take off you have to get the government out of the way, get the government's and union's hands out of corporate pockets, and set up a long term regulatory and tax structure that provides surety and predictability in the markets.

This isn't hard. People who try to muddy the water, make half arguments, and pit one income class against another have no one's interest but their own in mind. If you vote for those who promise to solve inequalities by taking from one group and giving to another, or who seek to manage every possible outcome, success and failure via government intervention then you are part of the problem.

Go to your local PNZ meeting sometime to get a first hand look at what a remarkable failure trying to control the actions of people and companies can be through minutiae and punitive fees. And then apply that on the Federal level.

The problem with the middle class has nothing to do with the upper class. The world economy has changed, its thats simple. In 1945, if you were an American who survived the war; you came home to the only functioning economy in the world . From 1850-1960, the U.S. probably had 70-80% of the world's economic output. Europe and Japan had been destroyed by WWII and hadn't rebuilt yet. A high school education could get you a good middle age income with benefits on an auto belt-line or in a steel mill. The U.S. was producing almost all of the world;s intellecual properties. CEO's weren't that important. They had tremendous price elasticicity with no cheap over-seas competitions. Unions could easily exhort them and drive up industrial wages. What started happening during the 1960's. T

The world economy started to grow and it grew with more modern production lines and much lower labor rates. America started to outgrow its domestic power production; especially oil and became dependent on foriegn sources. By the late 1970's and early 1980's, foriegn competion was beginning to cut into profits of the huge American industrial companies and we started seeing bankrupcties; first in steel, the in the auto industry. At that point; middle American industrial workers had become grossly overpaid in the world economy; while CEO's became infinitely more important in guiding their companies in the world economy. Wall Street became more important as the flow of money became world wide; and very smart people who could capitalize on that flow, even if only taking 1 or 2% of the flow rose to the top of the financial pyramid. Then the micro-chip and information came about and we created the internet billionaires we we see today.

This isn't because of the tax code. The economic world has structurally changed. If you are going to attack wealth, you can't do it through modification of the income tax code, at least not below $500k or million. That simply hits small business owners, physicians and attorneys who simply won't work as hard and net you will gain very little. Over a million, perhaps government makes some money on rich entertainers and athletes and a few executives. The reality though is that the great wealth from business and Wall Street comes outside the income tax code; but instead from stock options and capital gains. Much of Wall Streets money is taxes at long term capital gain rates whether they originally had their money invested or not. The Bush tax cut gave Gates a massive tax break. Gates could take the massive amount of money held by Microsoft and pay it out as dividend and he only paid 15%. Did he complain about that. Has Buffett ever said a word that every penny he's ever earned was cashing in stock bonuses at long term capital gains rates. Raising income tax rates doesn't attack the rich; it attacks the incredibly productive upper middle class.

Example. Say I was the Facebook guy and wanted to have $500,000 of disposal yearly income. I would cash in $10 million of my stock options next year and put it into a whole life insurance policy. I'd pay $1.5 mil. in taxes. The I'd use the $8.5 million to buy a whole life insurance policy and let it sit for six year. Then I would have almost $700,000 yearly in tax free income yearly without ever touching any of my Facebook stock until I was ready to do the same thing. Its absolutely stupid.

ding ding ding. one of the biggest lies out there is the policies of the presidency brought the country out of the great depression when in reality it was the war and rebuilding efforts following the war that put people to work.

FIFY

Frank, I agree with you that CEO has become out of line in many cases and without question needs to be directly linked to company profit and stock performance. It needs to be tied to long term perform, more than short term. I would pay my CEO a reasonable wage; then give large stock options dated five years in the future than can be purchased at today's stock price and sold at the future stock price. If the company does well, the CEO does well. If the company's performance sucks, then so do his re-imbursement package.

The problem is that CEO's virtually hand pick the company board which then become puppets.