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Weighs in on income disparity

March 15, 2012
Messenger News

To the editor:

I read with interest Michael Barone's oped in Thursday's Messenger. Being a liberal blogger, I wondered if Barone reads my blog. However, I am not young, Barone has just seven years on me. Barone wrote that the top 1 percent reported 17 percent of adjusted gross income in 2009 and paid 37 percent of the total federal income tax. I have read people in this country pay in taxes close to their share of the wealth rather than income - not so unfair - the top 1 percent do have 37 percent of the wealth according to Wikipedia. In the '80s, when I was taking my 10 economics courses, I remember learning that in this country taxes were flat (everyone paid the about same proportion of their income in taxes) except at the extremes of income, if one included all taxes and fees. While income and property taxes are progressive (those with more income or property equity pay a higher proportion of their income in taxes), sales taxes (and VAT taxes - which are like a sales tax) are regressive (those with less income pay a higher proportion). With all of the tax cuts for the wealthy in the last 25 years, taxes are probably regressive by now.

I am concerned not about the very wealthy, I am concerned about the divergence within the more average percentiles of income. Over the last 40 years, in real dollars, the income at the 20th percentile has barely budged while that of the 80th percentile has about doubled to about $100,000. I think that the result has been that the cost of goods and services provided by those in the higher income brackets, like professionals, have increased in cost disproportionately. I think we have a real problem with diverging incomes. Medical costs, costs for higher education, and the cost of government are three sectors which have a disproportionate amount of professional workers. I am quite sure the cost of medical care, higher education, and government has gone up disproportionally over the years. As a society, we cannot afford the disproportionately higher costs. For men, median income in real dollars in 2008 was just about where the income was in 1968. The average man in our society has just been treading water over the last 44 years, up and down with regard to income. I do not know how to remedy the situation, but redistribution through taxes is one possibility.

Margot Tollefson/Conard




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