To Be Rich & To Spend
I was struck by Robert Reich's concise and ringing analysis in this paragraph of what it means to be rich:
But with a recession looming, Democrats need to stop being the party of Herbert Hoover economics. And the Republican[s] need to understand tax cuts for the rich won't help because the rich don’t increase their spending when their taxes are cut. They already spend as much as they want to spend. That's what it means to be rich.
[from Robert Reich, "The Way to Prevent the Looming Recession", Robert Reich's Blog, 10 September 2007.]
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on Thursday, 13 September 2007 at 02.55
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Some years ago, I watched a show in which a bunch of people, mostly newly rich, discussed their wealth and how it affected their lives. A recurring theme was that being wealthy means you don't have to worry about a lot of things that bedevil people of modest means. If the car battery dies or the water heater gives out, you just buy a replacement. When the credit card bill shows up, you pay all the charges — no letting the outstanding balance build up, no paying outrageous interest.
on Thursday, 13 September 2007 at 15.25
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"…the rich don’t increase their spending when their taxes are cut."
The rich generally buy stocks, bonds, and real estate. Thus, the money is out there for other people to use. Reich knows this, so I don't know what the hell he is talking about. I suppose he is trying to make an excuse to raise taxes, thus transferring the money to gov't, who in Reich's mind could put the money to better use. Let him try and make that case, and be laughed off the stage.
on Friday, 14 September 2007 at 00.51
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Rightsaidfred wrote:
And, as Reich said, the rich already buy all they want. Logically, that includes all they want of stocks, bonds and real estate.
Here, Reich is talking about "with a recession looming," with an eye to economic stimulus. Joe Sixpack being able to continue making his mortgage or rent payments, paying his other bills and still doing some discretionary spending matters. These things that he and millions like him do are important to keeping others in their jobs, keeping government revenues on an even keel and, by the way, keeping the rich in a frame of mind to invest.
What you suppose beyond that, plus your fling at mind reading, make it clear you really don't know what the hell he's talking about.
Reich is smart enough to know that raising taxes overall with a recession looming would only serve to make matters worse. I will say that in the current situation, you could bring marginal tax rates on those in the top 5 percent of income earners back to where they were in 2000 without unduly affecting the overall economy. In fact, if the added revenue was put to use wisely, reducing the budget deficit, spending for infrastructure needs, etc., you could go a long way toward minimizing the recession and its impact on people least able to cope with reduced income or job loss.
on Friday, 14 September 2007 at 19.15
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After thinking about it, I suspect Reich is angling for a job in Hilary's administration, so he is floating some Hilary friendly advice.
> And, as Reich said, the rich already buy all they want.
> Logically, that includes all they want of stocks, bonds and real estate.
> …with an eye to economic stimulus.
> Joe Sixpack being able to continue making his mortgage or rent payments,…
>…bring marginal tax rates on those in the top 5 percent
> …if the added revenue was put to use wisely