This Doesn't Piss Me Off - The Poor Not Paying Income Tax Does.

Outrageous CEO Perks: This Year's Top Picks
By DOUGLAS MCINTYRE
Posted 10:15 AM 11/10/10 Company News, People, Taxes

Thanks to gross excesses in executive compensation exposed during the financial crisis, CEO pay has come under increased scrutiny in recent years.

At the prodding of the SEC, compensation boards at public companies have cleaned up their acts somewhat, but CEOs still typically make far more than shareholders consider reasonable. Plus they often negotiate lavish perks that increase their pay by millions more.

To see the latest trends in perks and pay, 24/7 Wall St. examined the most recent proxies of dozens of large public companies where CEOs have outsized overall compensation. Not surprisingly, we found buried in the fine print, some very generous benefits. This is the 24/7 Wall St. list of outrageous CEO perks:

$391,000 in Tax Prep
Occidental Petroleum (OXY) shareholders have enjoyed returns of more than 35% this past year under CEO Ray Irani's reign. As a result, Irani's current compensation is $31.4 million. Included in that figure is personal tax preparation and financial planning at a cost of $391,000. The average person pays about $500 for financial planning. At Occidental's 2010 annual meeting, however, over half of shares voted were against the company's say-on-pay proposal (which means half the shareholders who voted were not happy with his compensation).

$772,000 to Cover Underwater Mortgage on Home Sale
Richard Anderson of Delta Air Lines (DAL) may not make as much as the other CEOs listed, but he certainly has his share of corporate perks. Although he earns $2.25 million a year, Anderson relies on the company to cover a number of what could be considered personal costs. For instance, Delta paid Anderson $772,000 in relocation costs because his home in Minneapolis, which he needed too sell to move to Atlanta, was worth less than his mortgage. No doubt, a lot of Delta employees and shareholders are desperate to get out from under their underwater mortgages too.

$110,000 for an Attorney to Negotiate Compensation
Carol Bartz, who joined Yahoo (YHOO) as CEO in January 2009, received about $39 million in compensation for that year. That included equity she otherwise would have made at her last job. However, according to estimates made by Glass Lewis, a leading governance consulting firm, Yahoo paid her more than she should have received, putting her in the top of its overpaid CEO list. Bartz, however, did not want to pay her attorney fees to negotiate compensation from Yahoo. Later, Yahoo paid the $110,000 bill.

$1.3 million to Relocate for New Job
Having just been hired on July 13, 2009, Boston Scientific (BSX) CEO Ray Elliot is quite fortunate to be receiving compensation totaling $33.4 million. Included in this is $1.3 million for relocation costs and a cost-of-living allowance, apparently needed for Elliot's new position.

$1.4 million in Security Services
Those holding executive positions at Oracle (ORCL) are known for receiving immense compensation without being held to any specific performance requirements. CEO Larry Ellison, for instance, received $84.5 million in 2009 -- the highest amount paid to any U.S. CEO that year. As though this were not enough, Oracle provides Ellison with $1.4 million in security-related costs.

$216,000 in Club Memberships
Randall L. Stephenson of AT&T (T) is the country's 12th-highest paid CEO, with yearly compensation of $20.3 million. Part of this pay includes $216,000, which is used specifically for Stephenson's club memberships. Additionally, Stephenson receives compensation in the form of automobile benefits and aircraft usage, including catering and crew travel costs.

$724,000 for Car and Driver
Another of the country's top-paid CEOs is Travelers' (TRV) Jay S. Fishman. He receives yearly compensation of $20.1 million. Of that, $724,000 goes toward car and driver services, as well as aircraft services, helping Fishman live up to his company's name. Many employees would say it's difficult to get their employers to just cover gas.

$639,000 in Aircraft Use
The CEO of Abercrombie & Fitch (ANF) made a massive $38.5 million in 2009. This salary earned him the second-highest ranking on Glass Lewis's overpaid CEO list. In fact, Michael Jeffries's 2009 compensation exceeded that given to the company's four other top executives combined by more than 360%. It's difficult to see any logical reasoning behind Jeffries's excessive compensation, especially when considering that $639,000 goes toward his personal use of a company-owned aircraft.

$2.5 Million in Tax Reimbursement
Leslie Moonves, CEO of CBS (CBS), is paid $44.1 million. CBS, however, is headquartered in New York, while Moonves lives in California. So, CBS pays $2.5 million in tax reimbursement to cover the difference between what Moonves would have paid if he lived only in California.

Surveys show that shareholders of many public firms believe a chief executive should make $2 million or $3 million and have bonuses that are tied to stock options. Yet, companies are still clearly willing to pay top dollar to recruit a new CEO or keep an existing one happy.

The position that most boards take when they defend CEO pay is that top talent is scarce. It's the same argument sports teams use when they offer players exorbitant salaries: Pay the going rate, or let the player go elsewhere.

That may be true. But one thing is clear from our list: Average Americans aren't likely to have high regard for executives who get larded with such outrageously lavish perks.



See full article from DailyFinance: http://srph.it/akeGx4

You are entirely right. Its just unbelieveable how easily manipulated some people are. Thomas Frank wrote a book (What's the matter with Kansas) which exquisitely demonstrates how people vote against their own economic interests. Thanks for posting this Atypical.

New from Citizens for Tax Justice


The Report the Fiscal Commission Co-Chairs Need to Read: U.S. Is One of the Least Taxed Countries

The co-chairs of the President's fiscal commission have released a series of options to reduce the long-term federal budget deficit by $3.8 trillion over ten years. Three fourths of the savings would come from cuts in public services while only one fourth would come from closing tax loopholes and reforming the tax system.

This makes little sense, given that the United States is one of the least taxed countries in the developed world. A new report from Citizens for Tax Justice explains that the most recent data from the Organization for Economic Cooperation and Development (OECD) show that the U.S. is the third least taxed country of the 27 OECD countries for which data are available.

_____________________________________
The vicious conservative propaganda in this country is now neck-deep. It's all to protect the wealthy, government and corporate power. Read more from different sources. Think for yourself.

Check this out.

http://salsa.democracyinaction.org/d...AoEo5gav0y7EB4

Quote:

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Originally Posted by Havakasha

You are entirely right. Its just unbelieveable how easily manipulated some people are. Thomas Frank wrote a book (What's the matter with Kansas) which exquisitely demonstrates how people vote against their own economic interests. Thanks for posting this Atypical.

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I read it Havakasha. Good book. But I wish you wouldn't mention books that people can read. I have never been asked by anyone here to suggest a title that can provide evidence for my comments. I don't see that anyone cares to learn more about these complicated subjects.

The ignorant have a slogan - Only opinions count - and they better be the RIGHT ones! From the RIGHT person!

Otherwise, it doesn't matter.

"The ignorant have a slogan - Only opinions count - and they better be the RIGHT ones! From the RIGHT person!"

I'm glad you had time to reflect on yourself lol.

Yeah but do all those things Atypical listed piss you off S&L?

Quote:

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Originally Posted by Havakasha

Yeah but do all those things Atypical listed piss you off S&L?

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No. Not at all. CEO's have put in a lot of work and effort to get where they are. Is the compensation excessive. Yes it is. Do I begrudge it, no. You or I can be a well paid (and effective lol) CEO if we applied ourselves.

It's not all about money as the statist's would like you to believe. It is naive to believe that either government or corporations don't have waste, excess, fraud....... You said so yourself when you pointed out that "there's always going to be waste in such a large stimulus package".

Im truly sorry your not concerned about the widening gulf between the wealthy and everyone else.


Record Gap between Rich and Poor in U.S.


And somehow S&L has no idea why this might be bad for the U.S.

Income Gap Widens: Census Finds Record Gap Between Rich And Poor

WASHINGTON — The income gap between the richest and poorest Americans grew last year to its widest amount on record as young adults and children in particular struggled to stay afloat in the recession.

The top-earning 20 percent of Americans – those making more than $100,000 each year – received 49.4 percent of all income generated in the U.S., compared with the 3.4 percent earned by those below the poverty line, according to newly released census figures. That ratio of 14.5-to-1 was an increase from 13.6 in 2008 and nearly double a low of 7.69 in 1968.

A different measure, the international Gini index, found U.S. income inequality at its highest level since the Census Bureau began tracking household income in 1967. The U.S. also has the greatest disparity among Western industrialized nations.

At the top, the wealthiest 5 percent of Americans, who earn more than $180,000, added slightly to their annual incomes last year, census data show. Families at the $50,000 median level slipped lower.

"Income inequality is rising, and if we took into account tax data, it would be even more," said Timothy Smeeding, a University of Wisconsin-Madison professor who specializes in poverty. "More than other countries, we have a very unequal income distribution where compensation goes to the top in a winner-takes-all economy."

Lower-skilled adults ages 18 to 34 had the largest jumps in poverty last year as employers kept or hired older workers for the dwindling jobs available, Smeeding said. The declining economic fortunes have caused many unemployed young Americans to double-up in housing with parents, friends and loved ones, with potential problems for the labor market if they don't get needed training for future jobs, he said.

Rea Hederman Jr., a senior policy analyst at The Heritage Foundation, a conservative think tank, agreed that census data show families of all income levels had tepid earnings in 2009, with poorer Americans taking a larger hit. "It's certainly going to take a while for people to recover," he said.

The findings are part of a broad array of U.S. census data being released this month that highlight the far-reaching impact of the recent economic meltdown. The effects have ranged from near-historic declines in U.S. mobility and birth rates to delayed marriage and the first drop in the number of illegal immigrants in two decades.

The census figures also come amid heated political debate in the run-up to the Nov. 2 elections over whether Congress should extend expiring Bush-era tax cuts. President Barack Obama wants to extend the tax cuts for individuals making less than $200,000 and joint filers making less than $250,000; Republicans are pushing for tax cuts for everyone, including wealthy Americans.


The 2009 census tabulations, which are based on pre-tax income and exclude capital gains, are adjusted for household size where data are available. Prior analyses of after-tax income made by the wealthiest 1 percent compared to middle- and low-income Americans have also pointed to a widening inequality gap, but only reflect U.S. data as of 2007.

Among the 2009 findings:

_The poorest poor are at record highs. The share of Americans below half the poverty line – $10,977 for a family of four – rose from 5.7 percent in 2008 to 6.3 percent. It was the highest level since the government began tracking that group in 1975.

_The poverty gap between young and old has doubled since 2000, due partly to the strength of Social Security in helping buoy Americans 65 and over. Child poverty is now 21 percent compared with 9 percent for older Americans. In 2000, when child poverty was at 16 percent, elderly poverty stood at 10 percent.

_Safety nets are helping fill health gaps. The percentage of children covered by government-sponsored health insurance such as Medicaid and the Children's Health Insurance Program jumped to 37 percent, or 27.6 million, from 24 percent in 2000. That helped offset steady losses in employer-sponsored insurance.

The 2009 poverty level was set at $21,954 for a family of four, based on an official government calculation that includes only cash income. It excludes noncash aid such as food stamps.

Arloc Sherman, a senior researcher at the left-leaning Center on Budget and Policy Priorities, noted the effects of expanded government programs in cushioning the impact of skyrocketing unemployment. For example, the Census Bureau estimates that 3.6 million people would have been lifted above the poverty line if food stamps were counted – a number that would have reduced the 2009 poverty rate from the official 14.3 percent to 13.2 percent.

Sheldon Danziger, a University of Michigan public policy professor, said while the U.S. has developed policies to combat poverty, it has trouble addressing ever-widening income inequality – even with a growing federal deficit and previous warnings by former Federal Reserve Chairman Alan Greenspan about soaring executive pay.

An Associated Press-GfK Poll this month found that by 54 percent to 44 percent, most Americans support raising taxes on the highest U.S. earners. Still, many congressional Democrats have expressed wariness about provoking the 44 percent minority so close to Election Day.

"We're pretty good about not talking about income inequality," Danziger said.

___

WANT to give affluent households a present worth $700 billion over the next decade? In a period of high unemployment and fiscal austerity, this idea may seem laughable. Amazingly, though, it is getting traction in Washington.
I am referring, of course, to the current debate about whether to extend all, or just some, of the tax cuts of President George W. Bush — cuts that are due to expire at year-end. They’re expiring because the only way they could be enacted initially was by pretending that they were temporary.

In this situation, it’s not clear what should be called a tax “cut.” If the temporary law is allowed to expire as planned, does that represent a return to normal, or a tax increase? Conversely, if some parts of the current rates are extended, should those count as a tax cut?

Psychologists call these descriptive choices “framing.” No one is proposing that tax rates be lower than they are now, so the question is whether some people should pay more, and, if so, who.

President Obama has proposed retaining the current rates on incomes up to $200,000 for individuals and $250,000 for couples. Under this plan, everyone would receive a tax “cut” relative to the rates in effect in the Clinton era. For a family with a $250,000 income or more, the cut would be about $6,000, because its first $250,000 of income would be subject to the current, lower rate. But such families would have a higher bill than they do now.

With the exception of the House minority leader, John Boehner, the Republican leadership has drawn a line in the sand, saying it will oppose Mr. Obama’s bill unless all taxpayers remain at current rates. Although it wouldn’t put it this way, the Republican position is, in effect, that if the rich can’t share in the bounty, rates should rise for everyone.

They offer three arguments to support their view.

The first is that it is folly to raise taxes in a weak economy. There is some merit to this argument, of course, but economic policy is always about trade-offs.

Tax cuts are one of many ways to stimulate the economy. Building infrastructure, for example, is another. We have to choose. And if the primary goal is stimulating the economy, tax breaks to the rich are simply not cost-effective. Numerous studies have shown that the poor spend nearly all of their income, while the rich save a significant amount of theirs.

The second argument is that not extending the tax cuts to high-income earners would impose an excessive burden on small businesses. Here, however, we fall into a statistical morass. The administration points out that only 3 percent of all businesses earn enough to have to pay any additional tax. But Republicans reply that those 3 percent of businesses earn 47 percent of the income from this entire sector, meaning that the higher taxes would apply to the bulk of small-business income.

Which is the most relevant number?

To understand these statistics, we need to know how small business is defined. The data come from tax returns, and the definition of a “small” business is one that is organized so that all the profits pass through to the owners, who then report these profits as income on their personal tax returns.

Partnerships and firms structured as S corporations are examples. This category can include businesses as diverse as barbershops, car washes, hedge funds and law firms. Goldman Sachs was in this category before it became a public company. And the fact that 3 percent of the businesses earn nearly half of the money is precisely what many people are concerned about: growing income inequality.

Which brings us to the third argument. Conservatives say that to do anything other than extending tax cuts to everyone would amount to “class warfare.”

The best response to that notion comes from Warren E. Buffett: “There’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning.”

Thomas Piketty and Emmanuel Saez, two academic economists, provide data to back up Mr. Buffett’s view. They show that the proportion of income earned by the top 1 percent of American families was about 10 percent of the national total from 1945 to 1979. Since 1980, that share has doubled, reaching about 20 percent in 2008 — or more, if capital gains are included.

The growth rate has been even faster for the ultrarich — those in the top one-hundredth of 1 percent in income.

Other segments of society, meanwhile, are losing out, with their share of the total declining, and their real incomes remaining stagnant.

And what about incentives? Will the owners of the profitable small businesses work less hard, or hire fewer people, if their own after-tax income falls? This is a much-researched question, and the weight of current evidence suggests that we shouldn’t expect significant real reductions in economic activity if rates change in the range under discussion.

There is another possible argument for including the rich in these tax cuts, one based on “fairness.” By this reasoning, the wealthy are entitled to low tax rates because they have temporarily had them, and it would now be unfair to take them back.

But by that same argument, unemployment insurance should never expire, and every day should be your birthday. “Temporary” has no meaning if it bestows a permanent right.

The question comes down to whether we want a society in which the rich take an ever-increasing share of the pie, or prefer to return to conditions that allow all classes to anticipate an increasing standard of living. Demanding that the rich get a tax cut as a condition for tax relief for others is simply elitist. Tea Partiers, take note.

Why is this income inequality so important? In your words, not an article.

Would you agree that one of the economic goals of third world countries
(with wide disparities in income between the rich and poor) is to develop a more equitable society? Why do YOU think that is so? What benefits are there to society when most people can achieve their dreams and live a decent life and provide for their children. What would a lack of upward mobility and inability to reach the middle class and beyond do to the psyche of a a nation?

A. Its leading to a sense and an understanding among many people that the deck is stacked against them. That no longer is the American dream as reachable as it once was, and that the wealthy control our govt and politics, and therefore the policies and legislation which impact our daily lives.
Its enabling more and more corruption to take hold in my opinion. I dont believe that a society made up of increasingly disillusioned people is one headed for stability.

We have existed as a country for many years without the wide disparities of wealth we now have and were quite successful economically. When the wealthy (Buffett, Gates, Soros, Volcker etc. are practically begging to be taxed more, i think you should understand that something is amiss.

America is not a third world country. Let's start there. We are an industrialized country that was founded on opportunity, liberty..... And the opportunity is still there. I "dropped out" of an MBA program 70% done. What would have happened had I finished??? I had the opportunity to take a path..... We ALL have an opportunity to take a path.

In my 25 years of working, the only place I saw this, "leading to a sense and an understanding among many people that the deck is stacked against them" was when my companies labor was trying to unionize. The pro union guys felt they were getting ripped off, the others thought they were getting a fair days pay for a fair days work. The majority voted "no" (twice). I wanted to share that with you. Most unions are like that. Trust me, I relocated to Michigan from Pennsylvania and noticed it immediately. I wonder why?

The American Dream is indeed harder to come by, but not because of inequality. We are an industrialized nation. We've built our cities, we've built our roads, and we've CERTAINLY built enough houses / strip malls.... You fly. You've flown over LA or NYC. It's amazing. There's not a lot left to build. Add that to mfg jobs being exported... That's what makes it harder to experience the American Dream, and sadly, it is a drain on opportunity.

I did some limited research on economic inequality, and the consequences appeared somewhat "soft" for lack of a better word. I tend to think it simply boils down to the desire of "spreading the wealth" - plain and simple, and that's something that is gentically wrong to me. It's just...... un American.

Never said U.S. was a third world country. Only asked what do third world countries strive TOWARDS (we are retreating in this regard). Come to think of it -- what is that new book by Arianna Huffington called? :)
"THIRD WORLD AMERICA:HOW OUR POLITICIANS ARE ABANDONING THE MIDDLE CLASS AND BETRAYING THE AMERICAN DREAM." Hmmmm!

Tell me why its a good sign that we find ourselves with the level of inequalities we had during the great Depression. What do these eras both have in common?

I think you are completely wrong when you think this is just about "spreading the wealth". Its about much more than simply philosophy. its about basic economic fairness and its about future economic growth. Are you telling me middle class families have not been squeezed for the past 10 years?
And please dont tell me its because we have built everything we can possibly build and because of unions. Shipping jobs overseas is part of it and certain corporations have responsiblity for that. A lot of us are arguing that there is a HUGE growth industry in the aternative energy field. Who is doing the best to fight it. Yep you got it. The Republcians. I know, i know you just see conspiracy theory logic when i make such comments. Bullshit. Capital investement has been flowing to this area for quite some time despite attempts to protect the oil, gas and coal industries. It could have moved much more quickly if not for political and legislative obstacles set up to hinder it. Too bad Republicans dont understand its importance to future economic growth.

I would argue that its Un-American to have this much inequality in this country. You have to go back to the 1920's to find it. Though we are NOWHERE like these countries, this inequality does cause me to think of places like Egypt, Pakistan, India(Of the past, because its changing rapidly in a good way i believe) etc. These are all places i have travelled to.

I know you didn't say America is a third world country. You were making a comparison, and it wasn't apples to apples. That is what I was trying to point out. Third world countries lack opportunity.

I don't think it's a good sign or bad sign. I accept inequality. It's natural. Do I want to be as handsome as John Stamos and get laid by supermodels; sure do, but it ain't happening.

Economic fairness? Has America ever guarenteed economic fairness? I think it is fair to say that America has promised equality of opportunity. Isn't that why people immegrated here from all over the world?

You missed my point on unions completely. You talked about "people thinking the deck is stacked against them", and I agree noting that most of those people are unionized. They have a chip on their shoulder dude. I've seen it first hand. One guy was so polluted with BS that he thought "paid in capital" was cash and that our president was hiding it instead of giving him some of it. I'm serious.

My point about infrastructure is that US is "mature". That presents some unique challanges.

Yes, renewables appear to be an opportunity, but there are still many questions. The sad part is the jobs are going to low cost manufacturing nations.

You and I are talking here. I know your political allegence. No need to insert any anti republican rhetoric. I know where you stand lol. Give me some credit. Actually, venture capital has pretty much dried up for solar. They have a lot in it already.

I think what our government needs to do to reignite the US as the land of opporunity is to enable business to flourish such that they hire people, pay them and give them medical benefits. They then reap the reward of income taxes and payroll taxes (paid by both the employer and employee) as well as any taxes used from the expenditure of the earnings. If the government where truly compassionate, they'd get out of the way and allow free enterprise to flourish lol.

Third world countries lack opportunity? i dont think you could say that
about India, Brazil, China etc.

So the fact that inequality has reached proportions that have not
occurred since the 1920/30's Great Depression is "neither a good
or bad sign", but simply "natural" according to you.

I cant disagree more.

I know where your political allegiances stand as well. Lol. I have been telling you for a long time that you dont have to try to pretend anymore. :)

Infrastructure is "mature". i understand what you mean, but we are in
HUGE need to repair and replenish our infrastructure. China and other countries are
going to pass us by

I just find the need to blame the unions all the time as beyond simplistic.
Unions have benefited many people over the decades (and i am not saying
there isnt corruption and bullshit in some unions), including my grandfather.
Unions worked together with the company heads, and the govt to help turn GM
around. Its simply a lame talking point to point toward the unions as the source
of all problems. You have to acknowledge the problems with corrupt Boards of
Directors, and Corporate heads as well.

Venture capital has "dried up for solar" (depends what you mean by "dried up")
for all kinds of economic reasons. Money is still flowing there.
It will rise further i am sure. I am talking about the last 10 years when our
govt and polticians could have done more to encourage it when opportunities were ripe.
There are always questions about all new industries. Big deal.

"Get out of the way". You mean like from 2000 to 2008? LMFAO.

Scroll down S&L and read some important information about how inequality suppresses growth. It makes logical sense to me.

OP-ED COLUMNIST
Our Banana Republic
By NICHOLAS D. KRISTOF
Published: November 6, 2010


In my reporting, I regularly travel to banana republics notorious for their inequality. In some of these plutocracies, the richest 1 percent of the population gobbles up 20 percent of the national pie.

But guess what? You no longer need to travel to distant and dangerous countries to observe such rapacious inequality. We now have it right here at home — and in the aftermath of Tuesday’s election, it may get worse.

The richest 1 percent of Americans now take home almost 24 percent of income, up from almost 9 percent in 1976. As Timothy Noah of Slate noted in an excellent series on inequality, the United States now arguably has a more unequal distribution of wealth than traditional banana republics like Nicaragua, Venezuela and Guyana.

C.E.O.’s of the largest American companies earned an average of 42 times as much as the average worker in 1980, but 531 times as much in 2001. Perhaps the most astounding statistic is this: From 1980 to 2005, more than four-fifths of the total increase in American incomes went to the richest 1 percent.

That’s the backdrop for one of the first big postelection fights in Washington — how far to extend the Bush tax cuts to the most affluent 2 percent of Americans. Both parties agree on extending tax cuts on the first $250,000 of incomes, even for billionaires. Republicans would also cut taxes above that.

The richest 0.1 percent of taxpayers would get a tax cut of $61,000 from President Obama. They would get $370,000 from Republicans, according to the nonpartisan Tax Policy Center. And that provides only a modest economic stimulus, because the rich are less likely to spend their tax savings.

At a time of 9.6 percent unemployment, wouldn’t it make more sense to finance a jobs program? For example, the money could be used to avoid laying off teachers and undermining American schools.

Likewise, an obvious priority in the worst economic downturn in 70 years should be to extend unemployment insurance benefits, some of which will be curtailed soon unless Congress renews them. Or there’s the Trade Adjustment Assistance program, which helps train and support workers who have lost their jobs because of foreign trade. It will no longer apply to service workers after Jan. 1, unless Congress intervenes.

So we face a choice. Is our economic priority the jobless, or is it zillionaires?

And if Republicans are worried about long-term budget deficits, a reasonable concern, why are they insistent on two steps that nonpartisan economists say would worsen the deficits by more than $800 billion over a decade — cutting taxes for the most opulent, and repealing health care reform? What other programs would they cut to make up the lost $800 billion in revenue?

In weighing these issues, let’s remember that backdrop of America’s rising inequality.

In the past, many of us acquiesced in discomfiting levels of inequality because we perceived a tradeoff between equity and economic growth. But there’s evidence that the levels of inequality we’ve now reached may actually suppress growth. A drop of inequality lubricates economic growth, but too much may gum it up.

Robert H. Frank of Cornell University, Adam Seth Levine of Vanderbilt University, and Oege Dijk of the European University Institute recently wrote a fascinating paper suggesting that inequality leads to more financial distress. They looked at census data for the 50 states and the 100 most populous counties in America, and found that places where inequality increased the most also endured the greatest surges in bankruptcies.

Here’s their explanation: When inequality rises, the richest rake in their winnings and buy even bigger mansions and fancier cars. Those a notch below then try to catch up, and end up depleting their savings or taking on more debt, making a financial crisis more likely.

Another consequence the scholars found: Rising inequality also led to more divorces, presumably a byproduct of the strains of financial distress. Maybe I’m overly sentimental or romantic, but that pierces me. It’s a reminder that inequality isn’t just an economic issue but also a question of human dignity and happiness.

Mounting evidence suggests that losing a job or a home can rock our identity and savage our self-esteem. Forced moves wrench families from their schools and support networks.

In short, inequality leaves people on the lower rungs feeling like hamsters on a wheel spinning ever faster, without hope or escape.

Economic polarization also shatters our sense of national union and common purpose, fostering political polarization as well.

So in this postelection landscape, let’s not aggravate income gaps that already would make a Latin American caudillo proud. To me, we’ve reached a banana republic point where our inequality has become both economically unhealthy and morally repugnant.

I invite you to comment on this column on my blog, On the Ground. Please also join me on Facebook, watch my YouTube videos and follow me on Twitter.

Interesting article. I did see "may" and "suggest". I wouldn't call it definitive by any means.

I suppose the only solution is to screw the rich and give it to the poor. That's exactly what they want, right? Handouts based on redistribution of wealth. You can sugar coat it all you want. Man up and say it just like Obama did lol.

I'll tell you what EVERYONE wants and what this nation was built on - success. The governments role is not give success, but create an environment were opportunity can turn into success. If you want compassion, allow "the poor" to get a job and produce something that they can be proud of. No one on welfare is happy to be on welfare. Do you think the person checking out in the grocery line with food stamps feels good about it? I'll bet you my life that they'd rather work and succeed, but in your convoluted world, somehow the rich are the biggest problem - because they have money you can't TAKE to GIVE to others. I'm just glad you and those that think like you are in the minority. America would be lost if that ever changes.

All jarring aside, I appreciate your point of view, and the conversation. I have indeed learned a lot from our discussions and the articles you have posted even though we see things differently.

Im glad you appreciate the conversations. I do too. But in this area you really
piss me off.There is a reason the imbalance has reached Great Depression
proportions. The middle class are the ones getting screwed
yet you cry for the wealthy who have made out incredibly well. I know because i
come from a well to do family. I know how the game is played. Good accountants
make a difference.

My grandfather used to be in the 90% bracket. And people now paying in the mid to low 30's are complaining.
Man up" :) as Sharon Angle says and just try to be a true patriot for once. My god are you guys whiners.

No screwing of the rich necessary. Simple balance like Buffett, Gates, Soros,
Volcker etc suggest.

"you guys...." "....cry for the rich...."

Please remember that you have me on record as saying 1.) I'm fine if the extension ends for those who make > $250,000, and 2.) I'm fine with continually extending tax brackets upward (e.g. the guy making $1 MM is paying the same base rate as the guy making $100 MM - 35% I believe).

So what guys are you talking about, and are you sure I'M crying for the rich?

"i suppose the only solution is to screw the rich and give it to the poor"
"somehow in your world the rich are the biggest problem"
NO, once again. You just dont get it.

So yes, im definitey sure you "cry for the rich". You cant seem to get
you're thoughts straight on this subject. You are for the end of the tax cuts for the wealthy but keep crying for the rich. ITS ALL ABOUT SIMPLE FAIRNESS AND WHAT'S GOOD FOR OUR ECONOMY AND SOCIETY (read Kristoff article over and over until you start to truly consider it :)) as (for the hundreth time) Buffett, Gates, Soros, Volcker all know so well.

Who the hell said anything about compassion for people not wanting a job. Almost everyone wants one. Another old talking point which you seem to have dusted off after the Right dropped it last decade. So utterly boring.