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Donald Trump's promise to "Make America Great Again" can't be done without fixing the inordinate and unfair tax burden on the middle class.
Lopsided tax policies that grant more wealth-generating opportunities and more tax relief to the wealthiest Americans, while the vanishing middle class pays higher taxes to make up for the government's loss of income on the nation's top income earners and wealth accumulators, have killed the American Dream for tens of millions of the country's hardest-working citizens.
Where the Money Is Now
Before we look at individual tax rates and policies, let me say this about the new president's business tax promises, which we talked about at length on Wednesday.
On their own, they make sense. Cutting business taxes to promote business formation, increasing net profitability so companies can reinvest in their expansion, hire more workers, and pay them more, makes good economic sense.
However, in the context of taxation in general, cutting business taxes almost immediately enriches business owners, corporate equity stakeholders, and shareholder "renters" who have the capital to play the markets long before the hoped for trickle-down effects of business tax cuts reach average wage-earning Americans.
In other words, business tax cuts are tax cuts for the upper-classes – especially the top 1%.
Speaking of the top 1%, Oxfam (an international confederation of charitable organizations) released a report this week to coincide with the World Economic Forum in Davos, Switzerland, that said the world's eight richest billionaires control the same wealth between them as the poorest 3.6 billion people in the world.
Six of the eight, whose total worth is approximately $426.2 billion, are Americans who combined own 70% of that pile.
- Microsoft founder Bill Gates, worth $75 billion
- Investor Warren Buffett, worth $60.8 billion
- Amazon.com founder Jeff Bezos, worth $45.2 billion
- Facebook founder Mark Zuckerberg, worth $44.6 billion
- Oracle founder Larry Ellison, worth $43.6 billion
- Media mogul Michael Bloomberg, worth $40 billion
The other two billionaires are:
- Spanish retail magnate Amancio Ortega, worth $67 billion
- Mexican investor Carlos Slim Helu, worth $50 billion
Being an entrepreneur and dyed-in-the-wool capitalist, I commend these billionaires for their success, which they richly deserve.
Who Truly Deserves a Break
My point is twofold; they don't need a tax break and they can afford to pay more in taxes. The top 1% of wealthy Americans can afford to pay a lot more, and the top 10% should pay more, too.
The middle class, meanwhile, isn't making more money. Wages have been stagnant to actually slipping for more than a decade. They've had no tax relief to speak of, certainly not in relative terms. And what's in Donald Trump's proposed tax "simplification" plan is a joke.
Right now there are an array of federal tax b…
About the Author
Shah Gilani is the Event Trading Specialist for Money Map Press. In Zenith Trading Circle Shah reveals the worst companies in the markets - right from his coveted Bankruptcy Almanac - and how readers can trade them over and over again for huge gains. He also writes our most talked-about publication, Wall Street Insights & Indictments, where he reveals how Wall Street's high-stakes game is really played.