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From: orb@whuxl.UUCP (SEVENER)
Newsgroups: net.politics
Subject: Re: Re: The WSJ on Reaganomics
Message-ID: <349@whuxl.UUCP>
Date: Mon, 19-Nov-84 08:56:22 EST
Article-I.D.: whuxl.349
Posted: Mon Nov 19 08:56:22 1984
Date-Received: Tue, 20-Nov-84 02:55:54 EST
References: <421@hogpd.UUCP> <333@whuxl.UUCP> <652@loral.UUCP>
Organization: Bell Labs
Lines: 48

> >However I also find it more impressive
> >that for the first time in 40 years there has been a major shift in the
> >income distribution from the middle class and poor to the rich.
> >... When the majority of people making under $20,000 are facing a decline
> >in purchasing power or in their share of income relative to the wealthy
> >then they are going to pay less income taxes.
> 
> 	The whole point of the discussion is that the belief that the
> Reagan tax cuts coddle the rich while savaging the poor is just so much
> crock.  The WSJ figures prove that.  Liberal have been saying that
> the rich were getting richer from the cuts while the poor were paying more.
> The WSJ figures categorically refute that position.  The article above seems
> to concede that while trying (rather inconvincingly) to explain it away.
> 
> 	The claim that income distribution has shifted from the poor and
> middle classes to the rich is a bit shaky.  The middle income groups
> encompassing the overwhelming majority of citizens has benefitted largely
> in lower taxes, lower inflation preserving their savings and investments,
> and lower actual interest rates (and indications are that real interest
> rates are about to decline).  The elderly on fixed incomes have also
> benefitted hugely by the drop in inflation.  And programs for the poor,
> as I and others have said here before, are as high as they have ever been.
>            Ray Simard 
 
If the rich increased their share of income to 90% I am sure they would
wind up paying more taxes.  The questions are:
1)is it fair for some people to get such a large share of national income
  in the first place?
2)does that mean that because they are getting more income than they got
  before that the rich should pay proportionately less taxes?
These are the questions involved in this issue. In fact 15 million more
Americans have slipped into poverty in the past 4 years.  But the middle class
has also declined by approximately 15% in the past 6 years. The net result
has been an unprecedented shift in the income distribution from the poor
and middle class to the rich.  This shift is irregardless of inflation, interest
rates or anything else.  All those factors are held constant in estimates of
income distribution.
That the rich have benefitted from economic trends in the past few years does
not justify their paying less of a burden in taxes.  The rich received a major
boon with the reduction of the marginal tax rate from 75% to 50%. The middle
class received no such whopping cut in their tax rate.  This cut in the wealthy's
marginal tax rate was not matched by any reduction in the loopholes which
already allow them to get away with paying less than the middleclass in actual
taxes.  As I pointed out previously from 5 millionaries paying absolutely no
taxes we have 171 millionaires paying absolutely no taxes.
I do not think that is fair. Do you Mr. Simard?
 
tim sevener whuxl!orb