Today, Forbes released its annual list of the 400 wealthiest Americans, which is topped by Bill Gates and Berkshire Hathaway head Warren Buffett. Overall, the total worth of the 400 “rose to an estimated $1.37 trillion in 2010, up 8% from 2009.”
Sen. James Inhofe (R-OK), though, doesn’t think that the very richest of the rich have made such gains. Inhofe wants to spend $830 billion over the next decade to extend the Bush tax cuts for the richest two percent of Americans, and said that those who want to see the tax cuts for the rich expire are fudging the numbers, “making everybody think they are middle class and that the superrich are getting richer”:
“It’s a continuation of class warfare. Nothing’s changed,” Oklahoma Republican Sen. Jim Inhofe said. “They try to play to the numbers, making everybody think they are middle class and that the superrich are getting richer.” Inhofe specifically rejects claims that extending the tax cuts automatically would add to the deficit.
As the Forbes list makes clear, the superrich are, in fact, getting richer. And at the same time, their effective tax rate has been falling, all the way to 16.6 percent according to the latest data (as most of their income is subject to lower capital gains and dividends rates).
Now, obviously, allowing the high-end Bush tax cuts to expire would affect people making far, far less money than those on the Forbes 400 list. But those affected are still in the richest two percent of American households, and 80 percent of the cost of extending the cuts would go to millionaires. This year, the Bush tax cuts will give a millionaire more in tax breaks than 90 percent of Americans will earn in total income.
Income inequality is also the worst its been since 1928, as the richest one percent of the country has been reaping a bigger and bigger share of total income. According to the latest data, “the gaps in after-tax income between the richest 1 percent of Americans and the middle and poorest fifths of the country more than tripled between 1979 and 2007.” Between 1980 and 2005, “more than 80 percent of total increase in Americans’ income went to the top 1 percent.”
Currently, the top one percent of households make nearly 25 percent of the total income in the country, after they made less than 10 percent in the 1970′s. And there’s even a stark divide within that one percent. The incomes of the top one-tenth of 1 percent (0.1 percent) has increased by 94 percent — or $3.5 million per household — since 2002. “The share of the nation’s income flowing to the top one-tenth of 1 percent of households increased from 7.3 percent of the total income in the nation in 2002 to 12.3 percent in 2007,” the Center on Budget and Policy Priorities noted.
Just 2.3 percent of Oklahomans (who live in a state where the median income is $42,000) would be affected if the Bush tax cuts for the rich expire. But I guess Inhofe is able to square all this by convincing himself that tax cuts don’t add to the deficit, and thus can be given to anyone whenever he wants, for free.