Even as our politicians strive to figure out creative and equitable ways to tax the rich, ensuring the wealthy pay their “fair share” of taxes, they have actually mastered the art of taxing the poor.
Inflation is a tax on the poor. The rich are often protected from inflation as they own so-called “hard assets'' like real estate and stocks, the price of which naturally increases to reflect the inflationary effect. But not so the poor who must constantly play catch-up just to ensure their wage increases keep up with inflation in order to even maintain their modest standard of living.
Every four decades or so the pendulum of power swings, often painfully, between Capital and Labor. President Franklin D. Roosevelt ended the era of the Robber Barons and thereby empowered Labor through strengthening the Unions. Nearly 40 years later President Ronald Reagan strengthened the role of Capital by lowering taxes, while weakening the role of Labor by firing the unionized air traffic controllers. With the top 1% now owning more than 50% of the wealth in this country, the balance of power is likely shifting again to Labor, a transition that could once again be painful.
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