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Local Voices

Making a Case for Redistribution of Wealth

Americans who aren’t totally absorbed by finding friends on Facebook, the latest gory episode of “The Walking Dead” or “Dancing with the Stars” may be trying to comprehend the real meaning of Obama’s proposed “redistribution of wealth” agenda and how it will affect their lives. Not a problem.  Redistribution is alive and well and already in place. It’s simple to explain when you think about it!  There are two parts to the Robin Hood approach of taking from those who have and giving to those who don’t. 

Look at the much publicized Romney tax return issue now playing out in Presidential politics and the mainstream media while U.S. interests in the Middle East burn, our nation slips further into debt and hardworking Americans are giving up their search for jobs.  A recent Tampa Bay Times article stated that Gov. Romney’s family reported a total income in 2011 of $13,709,608 while paying $3,012,775 in taxes to help pay for out-of-control entitlement programs.  Add his charitable gifts of $2,250,772 which we must assume some of which went to the needy.  Compare that with Obama’s family reporting a 2011 income of $844,585 (and a hell of a lot of Air Force One and paid vacation perks that even Romney doesn’t get) and tax bill of $10,694 plus charitable gifts of $172,130.

When you add it all up, Obama redistributed only $182,824 of his personal wealth to the American way of life compared to Romney’s personal contribution of $5,263,547. Do the math!  That means Romney gave over five million dollars more to the people of America than Obama; $5,080,723 to be exact, all while Obama continues to demonize millionaires for not paying their share.  On top of this, the mainstream media continues to lambaste Romney for being a self-made millionaire and, get this, for giving needy Americans more money in taxes and charitable contributions than Obama.

But wait a minute, there’s more!  Look at two sample groups of Americans making up the earned income versus the combined local, state and federal tax burden.  For example, the poorest 20 percent of Americans make an average yearly income of $13,000 earning 3.4 percent of the total income in America and pay only 2.1 percent of the nation’s total tax burden.  On the other hand, the top 1 percent make 21 percent of all income and pay 21.6 percent of all taxes.  Stay with me now – this same “poorest” 20 percent tax group pays 17.4 percent of their income in taxes while the wealthier 1 percent group pays 29 percent.  More is better? Right?

Many low-income workers don’t pay any Federal income taxes thanks to a series of tax cuts endorsed by Republicans such as the 1975 Tax Reduction Act, 1986 Tax Reform Act, 1997 Taxpayer Relief Act, and 2001 Bush Tax Cuts.  When it’s all said and done, we have one candidate for re-election championing an even more severe redistribution of wealth by calling for higher taxes for the rich and more entitlement benefits for the poor.  The other candidate promotes rapid growth of small business through less taxes and fewer regulations and, yes, even encourages everyone to earn more taxable income. Conclusion?   Those who earn the most, do the most to support the people of America through taxable income. 

Playing the tax-rate “them versus us” blame game is far too complicated for campaign rhetoric and media sound-bites.  It’s more clearly understood when you begin at the top comparing the Presidential candidate’s personal redistribution plans.

Bill T

11:09 am on Monday, September 24, 2012

If you are going to compare the two candidates plans, please get your facts straight. Obama paid $162,074 in taxes (not 10,694 which was his taxable interest income) plus $172,130 in charitable contributions.

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Jack Sprat

4:22 pm on Monday, September 24, 2012

If that is a valid correction, then we have the following redistributions:
Romney, $5,263,547.
Obama, $334,204.
Both supposedly paid their "fair share" according to current tax laws.

"When it’s all said and done,

we have one candidate for re-election championing an even more severe redistribution of wealth by calling for higher taxes for the rich and more entitlement benefits for the poor.

"The other candidate promotes rapid growth of small business through less taxes and fewer regulations and, yes, even encourages everyone to earn more taxable income.

"Conclusion? Those who earn the most, do the most to support the people of America through taxable income."

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Lynda

4:52 am on Tuesday, September 25, 2012

Jack, there is no evidence that "fewer regulations and less taxes" results in rapid growth of small businesses. That is a myth. Start-up small businesses benefit from support services--often through government or educational institutions-- which assist them to become profitable as well as to be good community citizens by knowing and following local regulations. The vast majority of small businesses without support fail because their owners are unable to manage revenue, staff, products or their own time and because they do not have access to sufficient capital.

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Harvey A. Smith

10:12 am on Tuesday, September 25, 2012

Yes, you are correct, however the point still remains that overall - all taxes and charitable donations taken into consideration - Romney personally gave more to the American people in the taxes he paid over many more years than Obama because he earned more as a self-made business man! Until he became Senator (briefly), how much did Obama personally "contribute" to the American people?

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Lynda

10:38 am on Tuesday, September 25, 2012

Mr. Smith I do appreciate your blog because it offers a chance to discuss the "redistribution" argument. I believe your last post was directed at Bill T, however, I am concerned that you believe total dollars is the measure of an individual's giving to one's community as opposed to giving a % of one's dollars. And if you are indeed a "local" voice, you must know the many, many people who give time, energy, skills to Gulfport. And you must know that the LDS church requires giving at least 10% of one's income , so the large dollar amount given to Gov. Romney's church and included as charity is actually membership dues. Certainly we have reason here in Gulfport to be thankful to the LDS people who replaced the old building which stood where their nice, new one is so the dollars given by members do good works. I just have trouble thinking that "church" contributions are really the same as charitable contributions given without expecting a benefit in return (of course those mugs and tote bags can be useful, but not in the same category as eternal salvation.!!) The taxes paid by the candidates are another matter since we only have the last two years of Mr. Romney's taxes to use as a comparison.

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Bill T

1:38 pm on Tuesday, September 25, 2012

However, Romney did not give more as a percentage of his income. "Do the math" as someone likes to say ;-) Do you have a source for the top 1% of income earners paying at 29% tax rate? Seems high to me as most of the 1% are not getting their income from wages which is, as you know, taxed at a higher rate than other forms of income.

Lynda

11:35 am on Monday, September 24, 2012

Redistribution goes both ways in our current tax system. Frankly the subsidies given to wealthy people through targeted deductions (see Gov. Romney's tax returns for 2010 & 2011, sorry that is all we voters will get.) and oil companies with record profits far outweigh any "redistribution from Robin Hood-type policies". Also, I really object to the broad category of "charity" being applied to the required tithing of his income given to the Romney's LDS church; it doesn't seem voluntary to me. I agree that this is too complicated a subject for bumper stickers and sound bites. It is also too complicated a subject to discuss with only two years of Gov. Romney's tax returns. He refuses to tell us that his tax plans will (do the math!) result in the elimination of the home mortgage deduction for all levels of taxpayers as well as any of his other changes to the tax code. So all we have to go on is how he filed his own returns which he refuses to give more than 2 years to the voters as every other candidate has done and as he himself did for Sen. McCain. Gov. Romney has been running for President for the last seven years (or more) and should provide his returns for those years when he sought public office. Or does he think the rules don't apply to him?

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Jasminetea

5:07 pm on Monday, September 24, 2012

Do take into account that Romney got paid 0 dollars for the 4 years he was governor of Mass. That was his choice.

Dad of Three

8:16 pm on Monday, September 24, 2012

If I was that rich, I wouldn't expect to be paid for being governor. I believe that independent Mayor Bloomberg of NY City takes $1 a year as his salary, and as we know he is also extremely wealthy.

Many people who are not as rich as Romney put in multiple hours per month in their own personal contributions to committees and boards of not-for-profit organizations, and (in many states) boards of education, to which they are elected but unpaid members.

That says more than tithing contributions for their respective churches.

Contributions to directly aid the needy, of course, are much more important than contributions to any religion, as those funds may - or may not - partially get to the truly needy.

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Jack Sprat

4:52 am on Tuesday, September 25, 2012

Interesting - Romney’s 2011 tax return shows charitable contributions totaling a little over $4 million, meaning he donated 30 percent of his income and paid 14% of his investment income in taxes. That totals over $7,000,000, much of which is supporting less fortunate people.

Yet many continue to criticize him for being successful (he did not inherit his wealth) and being faithful to his church. Not many Mormons are receiving government support because the LDS church tends to take care of members in a meaningful and truly helpful system.

Check this out - a WSJ article about the Mormon welfare program:
http://online.wsj.com/article/SB10001424052970204792404577227173888056682.html

Or search "Mormons receiving welfare" and see how many are on governmment support. Our politicians could learn a lot about the effective support of those in need by emulating the Mormon programs.

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Harvey A. Smith

10:17 am on Tuesday, September 25, 2012

All this concern about Romney being a Mormon. It's deja vu with the issue of Jack Kennedy being a Catholic. I would much rather have a devout Christian church member - of any flavor - as President than one who is not!

Michael D.

10:12 am on Tuesday, September 25, 2012

Trickle down economics is just as ineffective as Trickle Up Economics. Trickle up worked in the Depression, because people were willing to except jobs that were created by the government that helped the national infrastructure. They learned a trade that could be used for manufacturing/manual labor. Our society has moved away from a manufacturing economy.
Both Romney and Obama's plans are severly flawed. It is because of the experts they choose to look at the problem are experts in their fields, but like all people who gravitate to what we know. The "teams" to determine how to fix the problem were not diverse enough. That goes to the pay masters of the two candidates.
If a plan to help fix the corporate tax code which is being pushed by many S&P 500 companies was excepted, then the corporate tax percentage would drop to 18% but remove just about all the tax loop holes. Meaning that all companies would pay there fair share.
If we went to a flat tax it would also even the burden of the average american. The upper and lower class play on average 14% of the income to taxes (that includes all donations). The average middle class tax payer pays 30% of their income to taxes. The upper class may pay a large percent of the total dollars, but there 14% doesn't hurt them as much as the middle classes 30%. A flat tax of 18% would put us in a position to eliminate the deficit and pay down the debt. Which neither candidate is truly willing to do.

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Torrey Craig

12:32 pm on Tuesday, September 25, 2012

Taxes are what we all pay in form or another to maintain our civil society. Historically we adopted a system that calls on the those of our society who are more able to contribute at a higher rate than those who are less able. That is the nature of a progressive system of taxation. When looking at an individual's income tax return please keep in the words of Will Rogers - The income tax has made liars out of more Americans than golf.

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Lynda

6:11 pm on Tuesday, September 25, 2012

Love the Will Rogers reference!

Jack Sprat

10:29 pm on Tuesday, September 25, 2012

These "conversations" alwatys go the along the same lines - obviously everyone is an expert on some facet of politics, the economy, religion, choice, the constitution, taxation, regulation, environment and every other discipline that could possibly affect our lives.

It appears that everyone has made up their mind whether they want redistribution increased or decreased and that is indeed what it all comes down to. Neither party is going to change the status quo significantly - but those taking a side are sure that we are doomed if the other side "wins."

Where has redistribution gotten us? Are we better off today than we were four years ago? 47 years ago? Consider this:

1964: Black out of wedlock birthrate 18%, white 3%. Enter the Great Society Welfare State: 2010: Black, 73%, White 29%, Hispanic 53%. Our politicians blindly put in ADC and then TARF. Moral bankruptcy was the end result, and a catastrophe for the children and families in the inner city (and for that matter, in many rural states like West Virginia). Generations of people unable to care for themselves: that is a moral bankruptcy.

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Michael D.

7:08 pm on Thursday, September 27, 2012

You have to blame both parties for that because they have both profitted off it. No one wants to correct it, like you said.

Dee Dokumaci

11:41 pm on Tuesday, September 25, 2012

Good Topic, I have a few ideas which I will post later!

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Philip Penrose

10:49 am on Wednesday, September 26, 2012

Harvey A. Smith wrote"
10:17 am on Tuesday, September 25, 2012
"...I would much rather have a devout Christian church member - of any flavor - as President than one who is not."
=================================
So a Jewish president, for example, would be unacceptable to you?

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Freedom

5:26 pm on Thursday, September 27, 2012

Talk about redistribution, here's a good example of redistribution, a woman is voting for Obama cause he gave her a free Obama phone, God Help Us All this is mentality with the current State of the Union we are faced with....

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Harborite

7:08 pm on Thursday, September 27, 2012

Government redistribution of wealth is certainly occurring, but most of the wealth is being redistributed from the middle class to the wealthy corporations. Last year, Citizens for Tax Justice found that 30 major corporations had made billions of dollars in profits while paying no federal income tax between 2008 and 2010. These major corporations include General Electric, Boeing, Verizon, and Mattel. It is corporate welfare and their beliefs in government entitlements that are really costing us taxpayers. Corporate welfare comes in many forms including an endless list of IRS corporate tax deductions purchased by corporate lobbyists, the sense of entitlement to taxpayer bailout money for corporations including those on Wall Street, the taxpayer subsidies of Big Oil and defense contractors, and the multi-billion dollar annual farm subsidies to the Agribusiness industry. Redistribution of wealth from the working class to the big corporations is the biggest redistribution problem that we face in this country.

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Jack Sprat

9:01 am on Friday, September 28, 2012

"Redistribution of wealth from the working class to the big corporations is the biggest redistribution problem that we face in this country."

I am pretty sure I do not understand your point. Redistribution in the context of this discussion can be defined as government taking from some taxpayers and giving to others, who may or may not be paying taxes. There is no real redistribution to corporations - they just pay less than you think they should because of the mess our politicians have made of the current tax code. I think we all agree that the tax code is overly cumbersome and complex and should be revised so that everyone pays their fair share - whatever that might be.

Many feel that corporations and wealthy people should pay more taxes simply because they earn more money. But politicians have made no attempts to change the tax laws. Democrats had control of Congress for four long years, two under Obama. They passed lots of spending bills and have borrowed over a trillion dollars a year in the last four years (debt is up almost $6 Trillion in four years).

Going forward, do we want more redistribution or less? Obama has made it very clear that he will push for more, Romney has made it very clear that he will attempt to bring the country back to something approximating fiscal responsibility. That is a difficult concept to accept if one is receiving govt support.

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Dee Dokumaci

10:38 am on Friday, September 28, 2012

I am middle class & I am doing my part by not buying anything from the major corps you listed, first General Electric & Mattel merchandise is made in China which I refuse to buy since I did a search in google for American companies who manufacture in China first in the list is American Corporations in China for short jiesworld which gives a small list of these corporations cheaply made in China, I found out the hardway when I bought a GE washer & dryer at Home Depot which worked for 6 months it was under warranty but Home Depot found an excuse not to honor it, I tried selling it without success & ended up giving it to someone who used it for scrap metal that taught me a lesson to find a list of companies who are made in US you can go to this website findusmade as for Boeing I don't have time to travel working 6 days a week so they are not getting a penny of my money & finally I will never use Verizon due to they ripped me off for years with their phone & internet services, greedy jerks is what they are, so my suggestion do research before using certain companies, we can all try avoid doing business as much as possible, I do realize some companies we can't avoid not to use in those cases maybe we need to write to them & tell them how we feel....

Jack Sprat

9:01 am on Friday, September 28, 2012

The debt we incur cannot be reasonably expected to be repaid by the current working/taxpaying generation, so it is truly left to our children and yes, our grandchildren. Much of this debt has been and will be incurred to support those who cannot or choose not to support themselves and/or their families.

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-Ed Harris-

10:38 am on Friday, September 28, 2012

My business has been here in Dunedin since 1947 and we have seen them come and seen them go. Leaders, business, snowbirds and residents, through it all I can't remember anyone ever being excited about paying taxes. I do know that when you made plenty of money you paid more taxes and even though you did not like paying the tax you were proud cause it meant you were doing well. Its only in the last couple of decades that our greed has overcome so many. Our greed has let corporations replace our government and place us in the position we are in right now. Do we need redistribution? Yes! Our world has finally come full circle, if corps are people then its time to pony up! If you make more than $250,000 per year then yes, you should gladly pay 35-40% in taxes and quit whining. Trickle down was, is and always will be a joke. Tax breaks don't make me want to hire hire and expand, tax breaks make me want to pocket the money for a rainy day. Quit trying to sell Ice at the North Pole!

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Jasminetea

9:51 pm on Friday, September 28, 2012

Family business you stepped into, don't think your old enough to have started it yourself. Wonder if you would be saying that if the shoe was on the other foot. Redistribution is so unfair. It's an enabler for those who prefer to do nothing, while those who work there butts off should give those who don't. If you are shelling out $87K to $100K in taxes, you would most certainly be whining.

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Dee Dokumaci

9:51 pm on Friday, September 28, 2012

Hey Ed, I half agree with what you are saying, I feel if these corporations are wanting tax breaks there should be a condition like they can only get it if they expand & create more jobs, if they don't want to do that then they should pay their fair share whatever the tax rate is...

-Ed Harris-

11:20 am on Saturday, September 29, 2012

Morning Dee, yeah I think that is the heart of it all, with the Corps, kinda the 800 lb gorilla in the corner laughing all the way to the bank. Mrs/Mr Jasminetea I am 48, you do not step into a family business, your earn and work your way in. Family business does not mean you are set for life. Every generation has to remake and rebuild the business to fit the times and fit the person running it. Which is why family business are much rarer than times past. My family has paid it's fair share, more than it's fair share and less than it's fair share. It really depends on the year. Over the years we've had a variety of help from family, friends, the city, the county and the govt in general. All which helped keep us in business. I don't like writing checks for $150,000.00 or $15.00 in taxes but I know it's the right thing to do until the system evolves into something better. And no, I don't whine about it regardless of who is in the White House. The shoe for me has been on the other foot many times, which is all just part of life. Sometimes your up sometimes your down. But without everybody's help we would've been out of business a long time ago. American's all support each other and scratch out a life together. Clearly we don't all get along 100% of the time but this has been and always will be a lot better than anywhere else in the world that I can think of. Make no mistake, our systems are far from perfect but together we'll fix it and move ahead, apart we'll just be alone.

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Dee Dokumaci

5:19 am on Sunday, September 30, 2012

Good Day Ed, it's nice to see we can have a meaningful conversation & come up with solutions that would be fair for all citizens but unfortunately politicians don't think like we do if only they hear what we say, I sometimes wonder if they ever read our messages that we post here probably not right now they are all too busy trying to get themselves elected, I will be glad when we get this election over with, at this moment I don't know who I want to vote for anymore, what is happening overseas is very scary & dangerous, now we know for sure Iran is building nuclear weapons & Israel wants to stop them so we can be sure there will be war between them & we are all going to be caught in between whether there are republicans or democrats so either way there goes our economy, that will be the end of lot more small businesses & corporations will be hit hard but somehow they always survive, oh well it remains to be seen, as for Jasmine, I understand what she is saying, it is really not fair when we all work hard to build our businesses & pay our taxes which is fine but I get very upset when I see lazy people who can work but don't want to work, they just want to take, there are people out there who deserve welfare, by all means I completely support them but you know what it really comes down to welfare was supposed to be a temporary means & not long term, everybody needs to do their part unfortunately that is not the case & it is going to get lot worst before it gets any better.....

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Dee Dokumaci

5:19 am on Sunday, September 30, 2012

I ran out of room on previous post, I would like to add I am more in the middle than extreme right or extreme left, during election time politicians make lots of promises but once they are in, promises fizzle or other agenda's arise & those promises go in the back burner, it's a never ending cycle, instead of making speeches & mud slinging the other candidate, they need to listen to the public & answer their questions, I would love to be part of the debate where I can ask some direct questions to each candidate, I can easily tell when somebody is lying to me but this is not possible so I'll move on, I will be watching the debates & will base my decision on who I will vote for according to their answers providing the questions are what I would ask, I look forward to hearing your views so we can all reasonably compare :)

-Ed Harris-

12:45 pm on Sunday, September 30, 2012

Dee, I have one word for you......exactly! lol Don't you just love the promises lol What all of them should be saying is, " I will promise to do everything within my power to get along with my fellow politicians and always put the best interest of the American people first and also do my best to seek peace first in the world" now that's a promise, however that's not wins elections. People want a death match aired on Fox news and want ratings lol As for the debates, I don't put much stock in them because it's more of a chess game than a debate. We learn in school how to debate somewhat but rarely do the teachers take the arguing to the final level which is taking the content debated and figuring out compromise and application. This is the most important part of a real debate. Just screaming out talking points and saying "so there!" as if the words were a punch is what is done in 1st grade at P.E. I continue to hope every 4 years but have yet to see a real debate. Sit Obama and Romney down in a room by themselves and record it. That would be worth watching.

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-Ed Harris-

12:45 pm on Sunday, September 30, 2012

Dee as for any freeloaders (as some refer to them, not you) there will always be those who scam the system, the difference is when one Corp scams us it's for billions and when John Doe scams us for some food stamps it hundreds or thousands. the entire food stamp program is budgeted for 80 billion, Military budget is 929 billion. If you could get $400 worth of Food stamps per month for a family of four that's around 5 grand a year(which would really help a family), for 1 million people that's $500 million or $1 Billion every 2 million people. if the budget is $80 billion and there are 46 million on food stamps clearly not many are getting $400 a month so before we look down on (not saying you) on 46 million as dead beats or scam artists lets face the fact their not really getting much help on average. I do know it all adds up so we have to look at it but Corp tax theft or Corp welfare makes the food stamps program look like pocket change.

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