Republicans are fond of hysterically screaming that the United States is in desperate trouble due to a seemingly eternal list of threats. One of the dangers which most terrifies them is the idea of the rich paying higher taxes than they currently do. But what impact would it actually have if we went back to the distribution of wealth which was normal in America's past? How much would it help the middle class? How much would it really hurt the ultrarich? Here are some answers:
Larry Summers was being interviewed by Charlie Rose. He is former secretary of the treasury and a key economic advisor to Pres. Obama, and former president of Harvard University.
"Think about this: if the income distribution of rhe United States were the same as it was in 1979,there would be $1 trillion more in the hands of the lower 80%…1 trillion, or $11,000 per family inthe hands of the bottom 80% of the population and there would be $1 trillion less in the hands of the top 1%. …that would be $750,000 less on average, per family for them.
So there has been a big redistribution that has worked to the detriment of the middle class."
He then went on to point out that as this assault on the middle class is occurring, the government is providing less and less support for the middle class in many areas ranging from infrastructure to education costs. "So there have been a variety of changes that have exacerbated the inequality."
Rather than believing this is inevitable, he states, "… There are countries, Canada and Australia are two good examples, that, by focusing on these basic investments, by empowering workers, by strengthening education…through healthy regulatory mechanisms...have succeeded in having rising standards of living for the middle class."
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