Top 400 taxpayer information released - compared

mcrain

macrumors 68000
Original poster
Feb 8, 2002
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The top 400: Income way up and taxes way, way down

Before angry voters restore Republicans to power -- in the name of "tea party populism" -- perhaps they should consider just how well right-wing rule worked out for them during the past decade.

Last fall a Census Bureau study found that real median household income had declined from $52,500 in 2000, the last year that Bill Clinton was president, to $50,303 in 2008, George W. Bush's final year -- a period during which Republicans dominated Congress as well. Millions of those median households lost their health insurance (and, since the onset of the Great Recession, many of those same families have lost jobs as well).

In a single year, between 2006 and 2007, the income of those top 400 taxpayers rose by 31 percent -- from an average of $263.3 million to an average of $344.8 million per year.

When Bush became president, unsurprisingly, he curtailed public access to the top 400 report for eight years. The Obama administration has made the report available this year, but such embarrassing statistics will no doubt be buried again as soon as the Republicans return to power.
Full article:
http://www.salon.com/opinion/conason/2010/02/17/top400/

Does anyone find it at all surprising that this trend occured under the Bush administration?

On the other hand, I didn't realize the Bush administration hid access to the taxpayer information.
 

Ugg

macrumors 68000
Apr 7, 2003
1,985
15
Penryn
It's not surprising at that bushco oversaw such a huge wealth transfer program. While millions of Americans are barely scraping by, the wealthy are paying less in taxes. Something needs to be done.
 

AP_piano295

macrumors 65816
Mar 9, 2005
1,076
11
Really thats not that much, I have a hard time feeding a family on my 50 mil a year :confused:.

Bring back on honest to god progressive tax system please...
 

Rodimus Prime

macrumors G4
Oct 9, 2006
10,132
4
It'll be interesting to see how our right-wing friends respond to this.
I think you need go back farther in history and go back to oh 1990 and see a to about then when pay and income started taking off.

The skyrocketing really took off under Clinton not Bush. Like the housing problem this has been just pass the buck down the road.
It is out of control and our corrupt government will do nothing about it.
They will not go after CEO pay going off the chart. For each CEO you fire you save over 300 jobs and yet CEO pay goes up. This is just more proof of that it has been a growing problem
 

mcrain

macrumors 68000
Original poster
Feb 8, 2002
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I think you need go back farther in history and go back to oh 1990 and see a to about then when pay and income started taking off.

The skyrocketing really took off under Clinton not Bush.
Actually, go back farther. Take a look at the 80-92 years for an interesting trend.

http://www.huppi.com/kangaroo/4Inequality.htm

Economists have a standard measure of income inequality, called the Gini Index. In this index, the higher the number, the greater the income disparity between the rich and the poor. (0 = perfect equality, 1 = only one person in the economy has all the income.)

Gini Index of Income Inequality3

Before After
Taxes Taxes
1979 0.403 0.352
1980 0.401 0.347
1981 0.404 0.350
1982 0.409 0.359
1983 0.412 0.368
1984 0.413 0.372
1985 0.418 0.381
1986 0.423 0.404
1987 0.424 0.380
1988 0.425 0.384
1989 0.429 0.387
1990 0.426 0.381
1991 0.425 0.379
1992 0.430 0.381
From Wiki - using 0-100 instead of 0-1
Gini indices for the United States at various times, according to the US Census Bureau:[6][7]

1929: 45.0 (estimated)
1947: 37.6 (estimated)
1967: 39.7 (first year reported)
1968: 38.6 (lowest index reported)
1970: 39.4
1980: 40.3
1990: 42.8
2000: 46.2 [8] ^ Note that the calculation of the index for the United States was changed in 1992, resulting in an upwards shift of about 2.
2005: 46.9
2006: 47.0 (highest index reported)
2007: 46.3
2008: 46.6
 

Ugg

macrumors 68000
Apr 7, 2003
1,985
15
Penryn
It's not surprising that the current index echoes that of 1929.

I've said it numerous times before and I'll say it again, the US is economically in a very similar situation now as it was during the Gilded Age and the Roaring Twenties. Probably the biggest difference between then and now is the much lower birthrate, which probably means much less chance of a revolution especially since the old farts in control are living longer.
 

Rodimus Prime

macrumors G4
Oct 9, 2006
10,132
4
It's not surprising that the current index echoes that of 1929.

I've said it numerous times before and I'll say it again, the US is economically in a very similar situation now as it was during the Gilded Age and the Roaring Twenties. Probably the biggest difference between then and now is the much lower birthrate, which probably means much less chance of a revolution especially since the old farts in control are living longer.
I am not surprised by that at all. Our pay scale is very top heavy and that causes massive problems. At one time major banks would not give loans to people who highest paid person was over 20 times the lowest paid person because it was unbalanced. Now we are over 313 time that for the average to top paid person.

Whole food CEO put a letter out bashing the way to high pay of CEO and in many ways blame that for our current problems. Whole food top excutived pay is 40 times that of the lowest. It was raised a little to account for the growth of the company becoming much larger. Top pay is 600k a year far cry from the multimillion other CEO are paid at companies of similar size.. He used his company as an example to counter the argument that not having that massively high pay you do not keep your top executives. Whole food has never lost one to another company.

You have companies that over 50% of total profit goes to one person. 10-20% of there total operating cost is CEO pay. Tell you something doesn't.

This top heavy income in the US is a huge part of the problem.
 

jonbravo77

macrumors 6502a
Feb 20, 2008
999
23
Phoenix, AZ
I will always maintain the the whole "trickle down effect" theory that a lot of republicans have saying if you give tax breaks to the rich that creates more jobs is a bunch of crap. I think in the last few years we have shown that the "trickle down effect" does not work. IMHO
 

mcrain

macrumors 68000
Original poster
Feb 8, 2002
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Illinois
I will always maintain the the whole "trickle down effect" theory that a lot of republicans have saying if you give tax breaks to the rich that creates more jobs is a bunch of crap. I think in the last few years we have shown that the "trickle down effect" does not work. IMHO
If I give someone who is already very wealthy a lot more money, the percentage of the money they receive spending or using that money in the economy will be less than if that same money is spread amongst people who need to use the money to survive.

If you give someone who is starving $100, they will spend it on food or other necessities. If you give someone who is wealthy, a million dollars on the idea that they are wealthy and will invest it to create more jobs, some of that money will get invested, and some will be saved, and some will go to passive investments.

(edit) Even the Republicans know this. They did their Bush tax cuts, and when the economy was slowing down, and they were losing their surplus, what did they propose? $300-600 tax credits for average people to stimulate the economy. The kicker is it worked.
 

Rt&Dzine

macrumors 6502a
Oct 8, 2008
736
5
This seems to fit with the Tea Party agenda. Watching video tapes of their rallies they appear to be against the lower and middle class and want tax money only to go to the wealthy.
 

Zombie Acorn

macrumors 65816
Feb 2, 2009
1,301
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Toronto, Ontario
This seems to fit with the Tea Party agenda. Watching video tapes of their rallies they appear to be against the lower and middle class and want tax money only to go to the wealthy.
Some people still have hope of rising up above poverty and don't want to be taxed to high hell when they get there. 38% of American pay no income tax.
 

mcrain

macrumors 68000
Original poster
Feb 8, 2002
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Some people still have hope of rising up above poverty and don't want to be taxed to high hell when they get there. 38% of American pay no income tax.
But that same 38% pay about the same amount of their income in taxes as the 62% that do pay income taxes.
 

Rt&Dzine

macrumors 6502a
Oct 8, 2008
736
5
Some people still have hope of rising up above poverty and don't want to be taxed to high hell when they get there. 38% of American pay no income tax.
If they were to become millionaires or billionaires, then I would agree, maybe the Tea Party thinking could benefit them.
 

NT1440

macrumors G5
May 18, 2008
12,140
13,983
Some people still have hope of rising up above poverty and don't want to be taxed to high hell when they get there. 38% of American pay no income tax.
Why is it that a few percentage points over the average is viewed as "taxed to high hell"? Also, you always seem to hold the view that they aren't still walking away with more money.
 

Eraserhead

macrumors G4
Nov 3, 2005
10,300
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Take a look at the profits that the business received after hiring the CEO, thats the only way we can tell for sure.
Most companies have a profit margin of at most 10% of revenue, so if the CEO is earning 10% of company revenue then he or she is overpayed.
 

Sydde

macrumors 68020
Aug 17, 2009
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Does anyone have an idea what the comfort threshold ceiling for income is? At what point are you simply taking far more money than you could ever realistically need?

My guess would be that somewhere around $600k.us is reaching the point where you are accumulating excess wealth. When you go above the comfort threshold, your money becomes not a means to be comfortable but a means to gain more and more control over other people. It is the comfort threshold, where ever that might be, at which the tax rate should climb steeply and intractably. No one needs to be encouraged to become obscenely wealthy, because one does so at the expense of others, as we have seen.

Simply cutting taxes will not "encourage job creation", that much is obvious. More money means a company can afford to buy more sophisticated machines that do the opposite of job creation (or make it easier to replaced skilled workers with less expensive unskilled drones). The only way to ensure job creation, which is the alleged goal of cutting top-end taxes, is to offer tax credits for every job created.
 

Rodimus Prime

macrumors G4
Oct 9, 2006
10,132
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Take a look at the profits that the business received after hiring the CEO, thats the only way we can tell for sure.
And rarely do they line up. CEO get pay raises and the company profits go down. Tell me how that adds up. During bad times CEO need to take PAY cuts instead of laying off 50 people to give themselves a raise.
 

Eraserhead

macrumors G4
Nov 3, 2005
10,300
10,359
UK
Does anyone have an idea what the comfort threshold ceiling for income is?
I believe in Psychological happiness terms it is approximately $15k/year*. Up to that amount happiness increases quickly with income, but after that it increases very slowly with regards to income.

During bad times CEO need to take PAY cuts
Definitely.

EDIT:

* = I don't know exactly what this $15k is. It could be $15k per person after tax, which could mean you'd need a family income of $100k to reach that if you had a couple of kids. Also its psychological research and second hand evidence at that (though from a researcher in the field) so take it with a bit of a pinch of salt.
 

Zombie Acorn

macrumors 65816
Feb 2, 2009
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But that same 38% pay about the same amount of their income in taxes as the 62% that do pay income taxes.
stats to back this up please?

And rarely do they line up. CEO get pay raises and the company profits go down. Tell me how that adds up. During bad times CEO need to take PAY cuts instead of laying off 50 people to give themselves a raise.
No one said they didn't, I said that if they hire a top tier CEO and their profits increase by milliions it was probably worth it.

Most companies have a profit margin of at most 10% of revenue, so if the CEO is earning 10% of company revenue then he or she is overpayed.
You said operating costs earlier and now you are saying revenues.

Why is it that a few percentage points over the average is viewed as "taxed to high hell"? Also, you always seem to hold the view that they aren't still walking away with more money.

The US has some of the most successful companies in the world, why shouldn't they walk away with more money: Also I just posted that 38% of Americans don't even pay income tax.
 

GfPQqmcRKUvP

macrumors 68040
Sep 29, 2005
3,211
373
Terminus
If CEO's and high-ranking executives weren't worth their exorbitant pay, they wouldn't be payed that much. That's how you justify it.

Whatever this report says, and I'm not that interested in it, it doesn't really matter. The people who earn the top 25% of the nation's income pay something like 38% of the income tax load. The numbers might be a bit off since I forgot the source (I've posted it here tons of times), but the overall theme still holds true. The progressive taxation system indeed works as it's designed.

It's like saying athletes get paid too much out of jealousy or misplaced outrage. It's just economics.

About people saying CEO's shouldn't get paid a lot when their companies lose money: What if, without that CEO, the general business environment would have caused the company to lose $100 million instead of only $50 million? Isn't it worth paying the CEO $15 million per year? Just because a CEO earns a really high multiple of a normal employee salary doesn't mean that business could have hired that many employees if the CEO weren't there...

Sydde said:
My guess would be that somewhere around $600k.us is reaching the point where you are accumulating excess wealth. When you go above the comfort threshold, your money becomes not a means to be comfortable but a means to gain more and more control over other people. It is the comfort threshold, where ever that might be, at which the tax rate should climb steeply and intractably. No one needs to be encouraged to become obscenely wealthy, because one does so at the expense of others, as we have seen.
Couldn't disagree more. You think 600k per year is enough, I don't. Even if I thought it was enough, it would only be out of pure spite and jealousy to say that other people shouldn't be able to make more without being punished for it. Capitalism isn't perfect, but it's the most meritocratic economic system we have. People with abilities that are in short supply are paid if there is a demand for what they have. It's the reason ibankers are paid so much. It's the reason Kobe Bryant makes $20 million per year. You seem to be forgetting that a lot of people making a million or more per year sometimes employ dozens, hundreds, or even thousands of people. These are the people who made America the world's most powerful country economically speaking. We have the largest company of all time. We have the most billionaires in the world. We have the most millionaires in the world. Our average pay is up there with the rest of the industrialized world. We have a thriving media that can say whatever they want even if you disagree with what they have to say.

You don't want multi-millionaires? Stop your demand for the innovations they've brought to the market. Remember though, lowering the monetary incentive for original work results in less of it being created. Advocate that at your own peril.
 

Rodimus Prime

macrumors G4
Oct 9, 2006
10,132
4
If CEO's and high-ranking executives weren't worth their exorbitant pay, they wouldn't be payed that much. That's how you justify it.

Whatever this report says, and I'm not that interested in it, it doesn't really matter. The people who earn the top 25% of the nation's income pay something like 38% of the income tax load. The numbers might be a bit off since I forgot the source (I've posted it here tons of times), but the overall theme still holds true. The progressive taxation system indeed works as it's designed.
So basicly what you are saying is a CEO should get paid more when a company is suffering and people in the company are losing their jobs to keep the company a float. If the CEO was doing his job that would never of happen. CEO should suffer like their employees. If they are doing layoff the CEO pay should be the first place to look to save money. Not giving them a raise.

Also CEO are the generally among the worse when it comes to pure greed. Business degrees do not have a business ethics class (and god damn do they need one)

They get paid that much because people like you believe they are worth it. Go look at Whole foods and explain to me why their top pay guy is only at 600k a year (including bonuses) yet other CEO of similar size are paid multi millions.

CEO are over paid and the more top heavy things get the worse things will get for the economy. The back bone of the economy is getting screwed.
 

GfPQqmcRKUvP

macrumors 68040
Sep 29, 2005
3,211
373
Terminus
So basicly what you are saying is a CEO should get paid more when a company is suffering and people in the company are losing their jobs to keep the company a float.
If you think that's what I'm saying you need to re-read my post a few more times.

If the CEO was doing his job that would never of happen. CEO should suffer like their employees. If they are doing layoff the CEO pay should be the first place to look to save money.
Already addressed in previous post.

Also CEO are the generally among the worse when it comes to pure greed. Business degrees do not have a business ethics class (and god damn do they need one)
Being a non-business student, I wouldn't expect you to know about required classes for business degrees. I also wouldn't expect you to talk about the degrees as if you're even half-way informed so color me surprised. As a senior majoring in business, my university makes it a point to emphasize ethics in nearly every required course. We usually spend 1-2 weeks talking just about ethical issues in class. Besides, you really think a professor telling his/her students "Don't embezzle, it's stealing and it's wrong!" is going to change the behavior of students? It's far more likely people's code of ethics are pretty well set by that time.

They get paid that much because people like you believe they are worth it.
Interesting theory. Complete bullocks, of course.

Go look at Whole foods and explain to me why their top pay guy is only at 600k a year (including bonuses) yet other CEO of similar size are paid multi millions.
I'll explain; he has different priorities than others. He's a great CEO but remember this: In the past four and a half years, investors of Whole Foods have lost over $4 billion in market capitalization. It happens to the best of them.

By the way, their CEO also got $5 million in stock options.

CEO are over paid and the more top heavy things get the worse things will get for the economy.
Thanks for letting me know. Maybe you should send an email to all the Fortune 500 companies and tell them their CEO's are overpaid and you'll do a similarly competent job for far less.