Robert Reich says the problem is wage inequality
by Oly Mike
Reich would like to up the minimum wage. I would like to instate a maximum wage through a steeply progressive tax rate with a top rate that is essentially confiscatory. If a really wealthy person know they are going to pay 85 cents per dollar in taxes once they are collecting their second or third million dollars in taxable income in the year, they will invest in infrastructure instead of a third or fourth home in a gated community. Infrastructure means industry, jobs, prosperity even for folks who don't live in gated communities. Click on the graphic below for the story from the Economist:
I am not sure how we persuade the CEOs to take less and pay better wages to more employees without a tax axe over their heads, but if you think it can be done, weigh in. How's that going to happen? That rising tide lifting the yachts of the bankers and CEOs? Is it translating into any widespread prosperity? If concentrating wealth in the hands of the few was going to create lots of jobs, wouldn't that have worked by now?
Reich says the problem is structural. Consumers no longer have the ability to power an economy. They first tried shifting to two incomes per household, women left the kitchen and went to work, then families tried putting in more hours, then they shifted to debt, stripping imaginary equity out of the family home and maxing out the credit cards, but the air went out of that scheme when the real estate bubble burst, and now here we are. That's a pretty professorial, historical evaluation of our situation, but it fails to recognize that the real cause of our economic woes are the illegal immigrants who are taking our jobs and beheading us.