THE
WORLD IN DISORDER –
AN EXCHANGE
James R. Fisher, Jr., Ph.D.
© September 14, 2014
Nick Hanauer, “The Pitchforks Are Coming…For Us Plutocrats” (Special Report: July/August 2014)
A READER WRITES:
Please explain to your readers that liberals in the
United States are not delusional and don’t wish to “take money away” from the
rich (to redistribute). We simply want the uber-rich (all 2- 3,000
families) to pay their fair share… since examination shows they don’t.
In 1918, US top tax increased to 77% (for over one
million dollars) to finance WWI; was reduced to 58% in ’22; to 25% in ’25; to
24% in ’29.
In ’32, top marginal tax rates to 63% during Great
Depression & increased thereafter: 1954- 1951 to 91%, to 92% in
‘52/’53; 91% ’54- ’63; ‘64’s top to 77% and to 70% 1965- ’81; to 50%,
1982-’86; for ’87 to 38.5% for individuals; to 33%
1988-1990; 31% ’91-’92. In ’93 39.6 thru 2000. 35% 2003-201?
No wonder we now have inadequate revenue!
Corporations once paid @ 2/3 of all U.S. taxes; NOW, they pay 9%; and many pay
zero! This has a cumulative effect!
Read David Cay Johnston’s “Perfectly Legal” (2005)
to see how our tax codes stack the deck.
Read Nick Hanauer’s op-ed “They’re Coming to Get Us
Plutocrats with Pitchforks,” where he (a billionaire) makes the case that
TAKING CARE OF PEOPLE (i.e., this country’s middle-class ‘engine’) will enhance
our economy.
The liberal objective isn’t economic equality, just
equal opportunity. Today, someone earning a $60,000 salary pays a larger
percentage of his income in taxes than the 400 richest Americans. And
that’s just wrong.
Liberals want to protect worker rights &
benefits, aid the less fortunate, seek solutions to society’s problems and try
to leave the world a better place for future generations. That’s a
liberal. - We need more liberals.
DR. FISHER RESPONDS:
Your statistics are accurate as America’s tax code
has been a boondoggle from the first with politicians using it to grease the
skids to ensure their reelections. Your
references – David Cay Johnson and Nick Hanauer – support your data although I
was surprised to see Nobel Laureate for Economics, Paul Krugman, not
mentioned.
There is a breach here between the statistics you
offer and the fact that we have yet to find a way to generate capital for business
investment and expansion, which translates into employment, without inducing wealth
creators to take such risks.
The insanity of the tax code has been a product of Democrats,
Republicans and Independents, Liberals as well as Conservatives who write the
codes.
When it comes to money sense, we have not been an
inspiring people. If you have your doubts, check our history from the
beginning. We throw money at problems
hoping it will stick with something approaching solutions. It seldom does.
The Federal Reserve Board shows economic improvement
from 1989 to 2013 has been steady for the top 3 percent, flat for the next 7
percent, and declining for the bottom 90 percent with nearly a 20 percent gap of
3 to 7 percent. Wealth separates us into
the equivalent of concaves.
Psychologist Ed Benner shows nearly a perpendicular
curve between wealth and the number of friends on Facebook, whereas beat writer
Christopher Ingraham shows that social segregation is still a fact in 2014:
“All my black friends have a bunch of white friends. And all my white
friends have one black friend.”
The Tampa Times columnist Jeff Harrington shows how
far middle class workers on the lower rungs are falling behind:
·
The lowest 25 percent making less than $20,000 a year show virtually no
improvement.
·
The next 25 percent making $30,000 but less than $40,000 show a sharp dip
to less than $20,000 in 1990, but recovered to normal earnings level but with
no improvement.
·
The next highest 25 percent increased to $40,000 but were unable to rise
above that level.
·
The highest 25 percent rose from $60,000 to about $85,000 in 2000, then
leveled off at $90,000 to the present.
Popular myth has the median household income in the
US at $75,000. The Economic Policy Board shows it is $53,890 in
2014. For most earners, wages aren’t keeping pace with inflation dropping
as much as 2.7 to 4.2 percent in actual spendable income.
Meanwhile, there is some encouraging news.
Real and projected spending per Medicare recipient in 2014 dollars show a
leveling off and far below those projected over the next ten years.
It may seem this is an open declaration in support
of your liberal thesis when clearly it is not. The key is education for
young people to take education seriously and stay in school.
THE PREFERRED ELIXIR, EDUCATION
Society has never had sufficient wealth to carry a
population that cannot read or write or think quantitatively proficiently
enough to develop the skill base to be employable and self-supportive.
Count on politicians and academics to mouth the pejorative
words the disadvantage want to hear about wealth creators, not realizing wealth
creation is not a zero sum game but the responsibility of each of us to take
care of ourselves and our loved ones.
Education develops self-acceptance which leads to self-reliance
and self-direction. This spells confidence.
In “Confident Thinking” (2014),
education is presented as the complement to formal education, not its
replacement.
We will always have the “uber-riche.” In the long history of man, the formula has seldom
varied, not even in the United States. The
top ten percent controls the majority of the assets in land, water and mineral
rights, as well as political clout be the ideology autocratic or democratic across
the globe.
BRIEF
HISTORICAL PERSPECTIVE
In ancient history, it was the conquerors (Genghis
Kahn, Attila the Hun), then emperors (Alexander the Great, Napoleon), followed
by the rise of monarchies (Suleiman I of the Ottoman Empire, James I of
England) and the papacy of the Roman Catholic Church that controlled wealth and
power.
Feudalism flourished into the 16th century
when Martin Luther and John Calvin broke away from the Roman Catholic Church and
established Protestantism. The Protestant
work ethic shattered conventional boundaries in power and enterprise giving rise
to capitalism.
Fledgling democracies followed ending the Feudal Age and leading to mercantile
capitalism. Into this midst rose the
American and French Revolution, then the American Civil War, which spiked the
Industrial Revolution.
Totalitarian states also emerged (German Nazism and
Russian Communism) with each societal eruption technological change left the
conventional world behind playing catch up to the present day.
Early in the 20th century, the working
middle class came to share in this wealth by organizing into labor unions and suing
for better wages and working conditions.
Workers went awry by also giving up control of work for comfort and security. This shadow now foils their progress.
The 20th century was marred by constant
conflagration (i.e., WWI, WWII, Korean War, Vietnam War, etc.) and led to wide fluctuations in the economy. Wealth creators profited immensely during
these wars swaying the working middle class away from labor unions to greater
corporate control with such incentives as wage and entitlement benefits.
When profits declined, these wealth creators
downsized, outsourced work, reengineered operation, sponsored a litany of redundancy
exercises or relocated to cheaper labor abroad.
Workers believed themselves powerless to do anything as they had become
complacent and counter dependent on the workplace for their total well-being.
Conditioning is a powerful weapon
when the mind cannot grasp life beyond its programming.
Contrast this with the fact that over the past sixty
plus years or since the end of WWII in 1945, position power in industry and
commerce has shifted gradually to knowledge power with workers, not management possessors
of this knowledge. Yet workers still
behave as if unskilled laborers, reactive and dependent up on management. It would be comic if it weren’t so tragic.
The United States now has the best educated workforce
in the history of mankind with 80 percent of all workers belonging to this professional
class.
The problem is that these professionals remain
complacent, dependent and wait for wealth creators to rescue them when they
have most of the power.
It is the other 20 percent, the foot draggers, the
high school dropouts, the malcontents, the drug addicts, the social misfits, the
young people playing house and having children when they are still children, handicapping
themselves to a life of poverty and despair that complicates the problem
further.
These people attempt to make their poor choices everyone
else’s problems. This gets the attention
of academics, economists, and social thinkers with little or no attention given
to the 80 percent highly qualified professionals who are underutilized and dangling
on the vine as if terminally adolescents comparable to mid-20th century
unskilled workers.
More absurd, few seem to have a proper perspective
on the situation as many of these professionals bemoan their status while living
at home or on the welfare dockets blaming their woes on everyone but themselves
as well.
Society has not leveraged the 80 percent
professional working class to advantage.
Consequently, wealth creators have been allowed to treat this new class
of workers as the “Robber Barons” treated unskilled workers in the early 20th
century.
This astounds immigrants who have come to this
country, sought an education sometimes against impossible odds, then took the
risks and absorbed the pain to realize successful careers. They display a passionate belief in America
because they have found that through hard work and dedication opportunity finds
them.
A PERSONAL ASIDE
Having grown up in a poor white family, my mother made
it clear the only way I would go anywhere was with an education, which meant to
study hard. Taking her advice, I
finished in the top ten percent of my high school class winning an academic
scholarship to university, where I graduated Phi Beta Kappa. Life has been good for having earned an
academic education. Many others have
done equally well by being essentially self-educated with the results being strikingly
similar.
Francis Fukuyama writes in the September/October
2014 issue of FOREIGN AFFAIRS (“America in Decay: The Sources of
Political Dysfunction”) that our interior secular socioeconomic structure is
anachronistic, which translates, our programming is all wrong for the
times. In Meet Your New Best Friend (2015), I write:
“To attempt to do for others what they best do for themselves is to
weaken their resolve and diminish them as persons. The same holds true of
ourselves.”
Author-philosopher Charles D. Hayes is a totally
self-educated man who has written widely on this problem of education, saying “Education is not something you get;
education is something you take.”
We are not all as motivated as author Hayes is “to
take” an education, and since credentials rule the day, it is pragmatic to get
an education simply to earn a job interview.
Many children are likely to be educated the same or
less educated than their parents as parents have drifted into the role of being
their children’s “best friend,” when parenting is an adult guidance system into
self-dependence and has nothing to do with friendship.
WHERE
AMERICA STANDS IN EDUCATION
According the Organization
for Economic Cooperation and Development, of the 23 countries surveyed, the
United States is fourth from the bottom with barely 30 percent of US adults
having achieved a higher level of education than their parents did. Even
bleaker as education bottom feeders, only 1 in 20 Americans ages 25-34 from
parents who did not receive a high school education have graduated from
college.
Compare this to the 20 richest countries in the OECD
survey where it is one in four.
The gap between high school and college graduates in
annual earnings between 1979 and 2012 was $30,000 after inflation. This
is only likely to widen with time putting more people on the dole, more people
criticizing the super rich, whose children attain education levels equal to or
exceeding their parents, meaning, wealth creators will remain dominant well
into the future.
Badgering the rich for not paying their fair share
is academic. The rich still pay most of the tax revenue collected by the
Internal Revenue Service in Washington, DC. That, too, has always been
true.
Eduardo Porter, OECD statistician writes in The New York Times (September 14, 2014):
Educational attainment of children that is greater
than that attained by their parents varies from nearly 60 percent at the top to
just over 20 percent at the bottom:
ORDER OF RANKINGS: Russia, Korea, Finland, Belgium,
France, Ireland, Poland, Netherlands, Canada, Estonia, Sweden, Australia,
Spain, Britain, Denmark, Norway, Italy, Slovak Republic, UNITED STATES,
Austria, Germany, Czech Republic.
If this is not disturbing, it is difficult to think
what might be so considered.
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