Les Leopold on runaway inequality
Phil makes a key insight I haven’t seen before:
“I now realize I misunderstood how taxes and incentives work” / “If corporate profits and executive salaries are taxed at a high top rate, then the incentive is to shelter profits from taxation by re-investing them.”
This is contrary to what you usually hear about lower taxes leading to investment…
I grew up and spent my early working years in the golden age of capitalism, which was from 1945 to 1976. Almost anybody—as least, any white American man—who was willing to work could get a decent job sufficient to support a family.
Then a lot of things turned bad as once. Worker pay no longer kept pace with productivity, but the pay of CEOs and wealthy investors grew much faster. Manufacturing declined and high finance expanded. Hourly wages declined and debt increased. What went wrong?
He blames America’s current woes on the adoption of what he calls the Better Business Climate model of economic policy.
This model is based on the argument that the key to economic prosperity is economic…
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