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The fallout from our nation’s decades-long effort to slash taxes on wealthy individuals and profitable corporations (and the public structures those taxes once provided) continues to spread. The Washington Post reports that the growing gap between the super rich and everyone else is directly and negatively impacting state government budgets:

Income inequality is taking a toll on state governments.

The widening gap between the wealthiest Americans and everyone else has been matched by a slowdown in state tax revenue, according to a report being released Monday by Standard & Poor’s.

Even as income has accelerated for the affluent, it has barely kept pace with inflation for most other people. That trend can mean a double whammy for states: The wealthy often manage to shield much of their income from taxes. And they tend to spend less of it than others do, thereby limiting sales tax revenue….

Rising income inequality is not just a social issue,” said Gabriel Petek, the S&P credit analyst who wrote the report. “It presents a very significant set of challenges for the policymakers.”

Stagnant pay for most people has compounded the pressure on states to preserve funding for education, highways and social programs such as Medicaid. The investments in education and infrastructure also have fueled economic growth. Yet they’re at risk without a strong flow of tax revenue.

Meanwhile, this week’s most stunning visual of the nation’s mushrooming inequality comes from the U.S. Federal Reserve, courtesy of the good people at Too Much Online: Read More

Commentary

Tax the rich 2The good people at Too Much, the online newsletter of Inequality.org have another sobering but powerful article this week. The rather amazing and disturbing finding: the wealth of the average American family is up over the last 25 years, but the wealth of the median family has actually dropped. If this finding leaves you scratching your head, it boils down to the fact that the rich have become so rich that they’re dragging up the overall average even though typical families are faring worse. This is from the article:

The growing wealth of these affluent, the new Fed data show, is driving up America’s average family net worth. But straight averages can mislead — and even deceive. If nine people each have zero net worth and a tenth person holds a fortune worth $10 million, the average person in that 10-person group will be a millionaire.Medians, by contrast, tell us more about how everyday people are truly faring. At the median point, half the people in any distribution have more, half less. In 1989, the new Fed Survey of Consumer Finances details, the median — most typical — U.S. family held $84,800 in net worth, after adjusting for inflation.

In 2013, America’s most typical families held only $81,200, 4 percent less.

Read More

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In case you missed it, Politico has a remarkable, if not terribly surprising story about Art Pope’s buddies, the Koch brothers. Here’s the opening:

“An Arlington, Va.-based conservative group, whose existence until now was unknown to almost everyone in politics, raised and spent $250 million in 2012 to shape political and policy debate nationwide. Read More

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At the same time that U.S. restaurant workers attempt to get by on the obsolete base wage of $2.13/hour (see the post below), the nation’s elite caste of imperial CEO’s and silver spooners gets richer and ever-more selfish.

Happily, some good guy groups have taken to documenting the excesses of the one-percenters in highly readable fashion.

Here is one such effort worth your time from the Institute for Policy Studies — It’s called Too Much: An online of excess and inequality. Read it and weep for your country.

 

 

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Greg Sargent at The Plum Line reports some new and, hopefully, energizing poll results for progressives from Pew Research.

Here’s the lead from the post:

“Pew Research has just released the most detailed polling I’ve seen yet on Occupy Wall Street, economic fairness, rising inequality, and the lack of Wall Street accountability. If these numbers don’t put an end to the nonsense about how Dems risk alienating the “middle of the country” by embracing a populist “class warfare” message, nothing will…”

Click here to read the entire post.