The extent of inequality in the US

[opebo]

Nowadays I would imagine something like 50% of Americans owe more than their 'assets'.

[opebo]

Older people remember what it was like when the top marginal tax rate was 70%, and even middle class folks paid rates higher than the top marginal tax rate today. They remember what it was like when Big Government was completely out of control with inflation in the double-digits, unemployment in the double-digits, shortages for gasoline because of price ceilings, etc.

The reason why so many younger people favor increased taxation and more Big Government that taxes-and-spends like crazy is because they've yet to experience THEIR tax rates going through the roof to fund Big Government. If you think the tax increase that happened in January is where it ends, that is not the case if most Democrats get their way in the midterms next year. Congressional Republicans and the few remaining conservative Democrats are the only reason why we have yet to return to out-of-control Big Government reminiscent of what we saw in the 1970s.

Dude, in the 1970s people had union jobs.  50% of a fat salary earned the easy way is a lot better than  100% of a mattress under the bridge.

[opebo]

The diagnosis is clear. But what can be the cure? Income tax increases might reduce the dynamics, but would leave the underlying pattern of wealth distribution untouched. Plus, you risk running into the Big Government scenario adressed by politico.

Wealth taxation and successive redistribution? We are not talking about land ownership anymore, this wealth is made up of bonds, shares, and derivatives. Highly mobile, and also so interlinked with the 'real economy' that you have to be careful to not kill the base of wealth generation altogether.
It is not as simple as the video graphics suggest - take some greenbacks from the big pile to the right and give it to the poor guys on the left. In practice, it would be more like transfering 0.0x% of Microsoft or Apple shares to each single mother. Interesting experiment, for sure, but I am unsure about the outcome. Would that really be a long-term redistribution of wealth, or just  a short-term cash-transfer, with all its consequences (stock exchange crash, inflation, better-fed children, etc.) ?

I don't have an answer yer.

Extremely high minimum wages, mandatory unionization of all jobs, 20- hour work weeks, confiscatory taxation, elimination of imports from low-wage countries.  All these are somewhat hopeful ideas.  However I'm skeptical of any limitations placed on the slave-master that don't involve guillotining him.

[opebo]

Just as an FYI, the video is very misleading and based on a poor understanding of economics. Wealth distribution is naturally very unequal and it's not much of a social problem either. It's income distribution which is relevant and that's probably also what people were thinking of when saying what distribution they want.

There's also peoples' inability to deal with large numbers. The difference between a net work of $200 000, $500 000 and $2 000 000 doesn't necessarily lead to very different lifestyles.

You fellows are quite missing the point!  What matter is that wealth inequality equals power inequality - the correct way to understand it is the wealthy own (control) the poor.  That is what wealth means - control of other people.  Anything else would be meaningless.  Income is just an issue of subsistence, but wealth is a political issue - by its very nature..

[opebo]

The left likes to pick winners and loses you see.

And the right only picks losers.

No, the free market does that. 

The State picks the winners (the wealthy) and the losers (those the wealthy control), krazen.  The fact that you call this a 'free market' is evidence that you have no understanding and are completely duped.

[opebo]

The reason why they have such a hard time with Romney's income being about $20 million a year is because they think he turns around and consumes $20 million worth of goods/services each year.

No, Politico, no one cares what he does with the money.  The fact that he got it out of the hides of the poor workers he controls is what is objectionable.    It is the power of capital to which one objects, not their obscene lifestyles.

[opebo]

I think this finding is more a result of people not understanding percentages and distribution functions more than anything else.

Amen

Thank you for pointing out the error!  The US is in fact quite egalitarian - what a relief.

[opebo]

The reason why they have such a hard time with Romney's income being about $20 million a year is because they think he turns around and consumes $20 million worth of goods/services each year.

The reason people have a hard time believing Romney has an income of $20 million a year is because Romney is a definitively unproductive person who has done no work in nearly six years, even referring to himself as unemployed, and is continually rewarded by the invisible hand of the free market State-imposed power-hierarchy for his non-efforts.