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Over the past 50 years the wealth in this great nation has shifted from the middle-class and even more dramatically, from
the poor, to the wealthiest 20% of Americans. This is not opinion but fact as shown here by the U.S. Census Dept:
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Share of aggregate income
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Year Low20% 2nd20% 3rd20% 4th20% Top20% Top 5%
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2001---- 4.2 --- 9.70 --- 15.4 --- 22.9 --- 47.7 --- 21.0
1991---- 4.5 --- 10.7 --- 16.6 --- 24.1 --- 44.2 --- 17.1
1978---- 5.4 --- 11.7 --- 17.6 --- 24.2 --- 41.1 --- 15.1
1964---- 5.1 --- 12.0 --- 17.7 --- 24.0 --- 41.2 --- 15.9
1953---- 4.7 --- 12.5 --- 18.0 --- 23.9 --- 40.9 --- 15.7
This is our governments numbers not mine. Clearly you can see that between 1991 and 2001 the piece of the pie going to the
top 5% of American families has increased by almost 4%. That means that the richest Americans have received a whopping 23%
raise in relative income over 8 years. So much for Bill Clinton being against the rich! Meanwhile the percentage of America's
wealth that trickles down to the bottom 20% in our economy is down to 4.2%, compared to 4.7% going to the Ralph Cramdons of
1953 or the comparatively generous 5.4% making it's way to the Fred Sanfords of 1978. From an egalitarian standpoint 1978
was a highmark for the little guy with the highest % going to the poorest 20%, the highest percentage going to the middle
20% and the lowest percentage going to the highest 20% and more specifically the highest 5%. Very simply put, since 1978 the
rich have gotten 39% richer and the poor have gotten 22% poorer while Joe Average has lost 12% of his share.
Since the system seems to be working quite well for the wealthiest Americans it is about time they started to pay for the
system. Keeping it simply: there is no need for 80% of Americans to pay any federal income tax when half the economy belongs
to the wealthiest 20%. In fact the majority of that top 20% would not see their income tax rate increased at all with a sliding
scale putting the heaviest burden on those who can afford it, the wealthiest 5%. These are the Paris Hiltons and Donald Trumps
who for the most part inherited there fortunes and will never have to pass up a pair of Pradas or fly coach despite paying
their fair share of taxes.
The rich certainly pay a significantly higher wage tax rate than the middle class or poor, a rich person may pay a 14% higher
rate on his salary than a middle class wage earner. However that same rich person is probably paying less than 5% on capitol
gains. Since most of Americans earning over a million dollars a year get most of there income from capitol gains this means
the wealthier you are the less percentage you pay. Since the wealthiest Americans can afford the best tax attorneys (can you
afford a tax attorney?) many of these super-rich pay little or no federal taxes because they earn no salaries and their earnings
can easily be hidden in thousands of tax shelters. While it may be noble to earn your fortune, tax laws reward those who collect
brokerage checks.
By simplifying the tax code to view all income, be it salary or capitol gains the same the IRS can collect more from the top
20% of Americans than it exacts currently from 100% of Americans. Most of this shift only impacts the top 2% of American households&, 18% should see little or no difference and 80% of Americans will not pay any federal income tax. This income tax reform
is only part of the total solution but it is the most important for the most Americans and it's impact can be felt immediately.
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