I was watching an interview with a Columbia Business School professor, whose name I did not catch, who challenged this point.
According to him, the bail-out will be paid for by federal taxes (as opposed to state/local taxes and social security taxes), on corporations and individuals.
Although I cannot remember the exact figures he gave, he claimed the vast bulk of these federal taxes would be paid by people making $150,000 or more per year.
Looking this up, I could only find the following figures for 2006 from the "Tax Foundation" (in turn based on IRS figures) for "Federal Individual Income Tax Data, 2006":
Figuring in corporate taxes, the relative tax contributions of the those making under $65K will be even smaller.
Thus, I am not sure if it is accurate that this will be a "transfer from poor to rich". Point n'est besoin d'espérer pour entreprendre, ni de réussir pour persévérer. - Charles le Téméraire
I thought it didn't. So it's simply increasing the debt, which will either mean new taxes, and it's just our guess as to who they will hit, or reduced programs. Either cancellation or transfer to local organisations. Which will have the choice of either raising local taxes or reducing benefits.
There are several ways of 'paying'. "Few can believe that suffering, especially by others, is in vain. - Galbraith"
The point is wealth matters and benefits matter. The self employed renter would have to make over $90,000/yr to be as well off as the $65,000/year employee with good benefits, but the statistics don't take that into account. The point is that those with $109,000/yr had probably 90 to 95% of disposable income before real estate started to dive. As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."
