Robert Shiller, Len Burman, and Greg Mankiw all miss the point: no one should suggest an elimination of Income inequality, but all should support equal percentage real taxation of all Incomes. Economic incentives will remain to work harder, though All will recognize there is not escape from Taxation. Does this mean there should be a flat Tax Rate? No. It simply means no Taxpayer will be allowed to pay less than those Taxpayers of lesser Income in real percentage terms. Guess what? Most of the lost revenues are recovered, and the National Debt shrinks.
Menzie Chinn clarifies that real Compensation has not show a great increase this Year, as touted earlier. Q2 Compensation was actually negative, Q3 was paltry 2.6%, and the Year over Year was only 4.3%. Those interested in the specifics of Compensation should go on to this Post. Output had been increasing 10% faster than Compensation since 1992, and productivity has risen over 5% higher than Compensation since 2000Q4. The elimination of Bonuses and Stock Options from the estimates could only massively lower Compensation rates.
Alex Tarbarrok poses some interesting questions which actually should be answered. The Savings rates is obviously defeated among lower Incomes, said Family members expected to Spend with the same abandon as the Better-Off. What percentage of the Gifts are Nonsense Gifts, bought solely because they are imagined desired. I remember the Husband who asked his wife if she wanted a new Car, or a string of Pearls. The wife adopted the same attitude as myself, asking, "Where would I wear the Pearls? I can drive the Car where I want." The famous debate between luxury and Practicality always surfaces, and I would advise adoption of the practical. lgl
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