Pizzigati, Sam

Magic Act: Making the Super Rich Disappear

By Sam Pizzigati

The Federal Reserve has once again counted up America's personal wealth — and omitted the nation's 400 richest from the final tally. But the new figures, even with that omission, show a divide still deepening.

In the middle of middle America — in a suburb just outside of Dayton, Ohio — funeral home owner Anne Dunbar has noticed a rather unnerving new trend.

Families used to want the obituary notices that Dunbar writes up to include a pitch for donations to their dear departed’s favorite charity. Some families are now requesting notices that ask for donations toward their funeral expenses.

You won’t find Anne Dunbar’s story — or any other anecdote about the collapse of America’s middle class — in the latest Changes in U.S. Family Finances study the Federal Reserve Board released last Monday.

America's Plutocrats Play the Political Ponies

By Sam Pizzigati

Any resemblance between democracy and U.S. Presidential politics has become, in our new super PAC era, purely coincidental. The only mystery: Why aren't billionaires placing even bigger bets?

Life sometimes imitates art. Life also sometimes imitates political cliché. The cliché in this case: the notion that tunnel-vision political reporting has reduced campaigns for American public office to nothing more than mere “horse races.”

This year, in the struggle for the Republican Presidential nomination, that “horse race” analogy has essentially become a literal reflection of reality.

The real horse racing industry follows a simple time-worn pattern: A wealthy connoisseur of horse flesh buys a thoroughbred. The wealthy connoisseur keeps racing that thoroughbred until the connoisseur loses interest.

The 'Buffett Rule' in History's Grand Sweep

By Sam Pizzigati

President Obama has proposed a specific new minimum tax rate for millionaires. Should America's rich feel angry or relieved? We check the IRS tax data archives for an answer.

The most famous secretary in America works “just as hard” as her billionaire boss — according to her boss, investor Warren Buffett — but pays federal taxes at twice the rate her boss does.

Debbie Bosanek, America learned last week, has been working for billionaire Buffett since 1993. In 2010 she paid 35.8 percent of her income in federal income and payroll taxes. Buffett paid his federal taxes at a 17.4 percent rate.

Law and Order 24/7, Except at Tax Time

By Sam Pizzigati

The rich don't much like paying taxes when tax rates run high. They don't much like paying taxes when tax rates run low either.

Any tax system that subjects rich people to high taxes is asking for trouble. Or so the politicians who cater to people of means incessantly argue. The higher the tax rate on high incomes, the argument goes, the greater the incentive the rich have to waste time and energy figuring out ways to evade paying taxes.

“Conservatives tend to talk about noncompliance as if it were solely a function of tax rates,” as former Reagan administration policy aide Bruce Bartlett noted last week, a perspective that makes tax evasion “yet another excuse to cut taxes.”

In 2001 and then again in 2003, that convenient excuse helped the Bush White House chop away at the taxes the IRS expects rich people to pay. The tax rate on top tax-bracket income slipped from 39.6 to 35 percent, and the rates on capital gains and dividends both dropped to 15 percent, from 20 and 39.6 percent.

On Wall Street, Still Tis the Season to Be Jolly?

By Sam Pizzigati
Institute for Policy Studies

Wall Street’s power suits aren’t humming along, this December, with all the holiday jingles. Bankers, traders, and law firm partners are quite frankly feeling kind of foul. End-of-year Wall Street bonuses, experts predict, are going to be down from 2010 levels — by as much, on average, as 35 percent.

Total 2011 pay for the typical bond-trading managing director at a top Wall Street securities firm will likely be off, says analyst Michael Karp, nearly 40 percent.

But those typical managing directors should be able to survive the holidays quite nicely. Bonus cuts will leave average high-powered bond traders with $1.8 million for their daily labors in 2011. The average U.S. worker would have to labor 43 years — an adult lifetime — to take home that same $1.8 million.

The Alchemy of Our Awesomely Affluent

By Sam Pizzigati
Campaign For America's Future

Today's super rich can't turn tin into gold. But they can get Uncle Sam to loan them free money. At the expense, of course, of America's bottom 99 percent.

How much money is pouring into the pockets of America's richest 1 percent? How much of this income are America's richest paying in taxes?

Major media outlets have been asking questions like these ever since the Occupy Wall Street movement first started gaining traction earlier this fall. But the numbers in their answers, suggests a groundbreaking new analysis from Bloomberg reporter Jesse Drucker, aren’t telling the full story.

For Our Top Corporate 1 Percenters, a 50 Percent Tax Discount

By Sam Pizzigati
Campaign for America's Future

Over a quarter century ago, in 1984, the Washington, D.C.-based Citizens for Tax Justice released its first in-depth report on how much America’s top profitable corporations were actually paying in taxes. America’s top companies, this initial study found, were paying only 14.1 percent of their profits in taxes, less than a third of the corporate tax rate then in effect.

That startling report left a bit of an uproar in its wake. Corporate tax loopholes would go on to figure prominently in the 1986 tax reform debate. The tax legislation eventually enacted would plug a host of them.

But the 1986 tax reform legislation also slashed tax rates on high personal incomes. Corporate earnings now faced a higher tax rate than the income wealthy Americans reported on their personal tax returns.

Plutocracy And The Debt Ceiling Debate

By Sam Pizzigati

Looking for a lesson in the goings-on in D.C. these days? Here’s one: The more our nation's wealth concentrates, the more our democratic give-and-take becomes all take — by the rich.

Once upon a time in America, back a century ago, our nation's rich paid virtually nothing in taxes to the federal government. And that same federal government did virtually nothing to better the lives of average Americans. But those average Americans would do battle, over the next half century, to rein in the rich and the corporations that made them ever richer. And that struggle would prove remarkably successful. By the 1950s, America's rich and the corporations they ran were paying significant chunks of their annual incomes in taxes — and the federal projects and programs these taxes helped finance were actually improving average American lives.

America's wealthy, predictably, counterattacked — and, by the 1980s, they were scoring successes of their own.

For Our Top 400 Taxpayers, a Near-Record Year

By Sam Pizzigati

America's super rich, new IRS income data show, partied on right through the depth of the Great Recession. And they shared precious little of their good fortune with Uncle Sam.

In 2008, the IRS revealed last week, 400 Americans reported at least $110 million in income on their federal tax returns. These 400, in a year that ended with millions of Americans out of work and home, averaged $270.5 million each, the second-highest U.S. top 400 average income on record.

The IRS only started reporting top 400 income calculations in 2003, and the agency's official “top 400” totals just go back to 1992. But older IRS data reports do make top 400 estimates from some earlier years possible. And these earlier figures leave the latest IRS numbers in even starker relief.