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Handouts Make Up One-Third of U.S. Wages

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    Handouts Make Up One-Third of U.S. Wages

    Yea the economy is improving!!!! This is rock solid sustainable! ROFL


    Government payouts—including Social Security, Medicare and unemployment insurance—make up more than a third of total wages and salaries of the U.S. population, a record figure that will only increase if action isn’t taken before the majority of Baby Boomers enter retirement.



    Even as the economy has recovered, social welfare benefits make up 35 percent of wages and salaries this year, up from 21 percent in 2000 and 10 percent in 1960, according to TrimTabs Investment Research using Bureau of Economic Analysis data.

    “The U.S. economy has become alarmingly dependent on government stimulus,” said Madeline Schnapp, director of Macroeconomic Research at TrimTabs, in a note to clients. “Consumption supported by wages and salaries is a much stronger foundation for economic growth than consumption based on social welfare benefits.”

    The economist gives the country two stark choices. In order to get welfare back to its pre-recession ratio of 26 percent of pay, “either wages and salaries would have to increase $2.3 trillion, or 35 percent, to $8.8 trillion, or social welfare benefits would have to decline $500 billion, or 23 percent, to $1.7 trillion,” she said.

    Last month, the Republican-led House of Representatives passed a $61 billion federal spending cut, but Senate Democratic leaders and the White House made it clear that had no chance of becoming law. Short-term resolutions passed have averted a government shutdown that could have occurred this month, as Vice President Biden leads negotiations with Republican leaders on some sort of long-term compromise.


    “You’ve got to cut back government spending and the Republicans will run on this platform leading up to next year’s election,” said Joe Terranova, Chief Market Strategist for Virtus Investment Partners and a “Fast Money” trader.




    Terranova noted some sort of opt out for social security or even raising the retirement age.

    But the country may not be ready for these tough choices, even though economists like Schnapp say something will have to be done to avoid a significant economic crisis.

    A Wall Street Journal/NBC News poll released last week showed that less than a quarter of Americans supported making cuts to Social Security or Medicare in order to reign in the mounting budget deficit.

    Those poll numbers may be skewed by a demographic shift the likes of which the nation has never seen. Only this year has the first round of baby boomers begun collecting Medicare benefits—and here comes 78 million more.

    Social welfare benefits have increased by $514 billion over the last two years, according to TrimTabs figures, in part because of measures implemented to fight the financial crisis. Government spending normally takes on a larger part of the spending pie during economic calamities but how can the country change this make-up with the root of the crisis (housing) still on shaky ground, benchmark interest rates already cut to zero, and a demographic shift that calls for an increase in subsidies?

    At the very least, we can take solace in the fact that we’re not quite at the state welfare levels of Europe. In the U.K., social welfare benefits make up 44 percent of wages and salaries, according to TrimTabs’ Schnapp.

    “No matter how bad the situation is in the US, we stand far better on these issues (debt, demographics, entrepreneurship) than other countries,” said Steve Cortes of Veracruz Research. “On a relative basis, America remains the world leader and, as such, will also remain the world's reserve currency.”

    #2
    someone was listening to rush today weren't they ??????
    Originally posted by Fusion
    If a car is the epitome of freedom, than an electric car is house arrest with your wife titty fucking your next door neighbor.
    The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money. -Alexis de Tocqueville


    The Desire to Save Humanity is Always a False Front for the Urge to Rule it- H. L. Mencken

    Necessity is the plea for every infringement of human freedom. It is the argument of tyrants.
    William Pitt-

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      #3
      dam liburals!
      1985 BMW 325e
      1997 BMW M3/4/5
      2007 Chevy Silverado Crew Cab 5.3 v8

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        #4
        You realize that the top 1% make 30% more today than they did in 1960, right? They get taxed less, and make more. That's where your deficit comes from. Who the fuck needs to make over a BILLION dollars a year? NO ONE does. I couldn't even spend that much if I tried. I'd buy like 100 cars, an island, a castle, a few houses, and still have over half of it left.
        Advanded Delphin Division
        My e30s: 1987 325i/1994 318iT

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          #5
          ^^^^^^^^^^^^^^^^^

          Ummm yeah NO thats not where the deficit came from......... It came form the govt spending too much money on programs like those listed above . Its the same reason why all the Western European countries or broke as shit too.
          Originally posted by Fusion
          If a car is the epitome of freedom, than an electric car is house arrest with your wife titty fucking your next door neighbor.
          The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money. -Alexis de Tocqueville


          The Desire to Save Humanity is Always a False Front for the Urge to Rule it- H. L. Mencken

          Necessity is the plea for every infringement of human freedom. It is the argument of tyrants.
          William Pitt-

          Comment


            #6
            Originally posted by delfin View Post
            You realize that the top 1% make 30% more today than they did in 1960, right? They get taxed less, and make more. That's where your deficit comes from. Who the fuck needs to make over a BILLION dollars a year? NO ONE does. I couldn't even spend that much if I tried. I'd buy like 100 cars, an island, a castle, a few houses, and still have over half of it left.
            the people who went to school,took risks and worked their ass off. Thats who should make big money. The people who employ the masses. The guy who signs your checks.
            We can serve you better through Email

            sales@blunttech.com
            www.blunttech.com


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              #7
              Originally posted by mrsleeve View Post
              ^^^^^^^^^^^^^^^^^

              Ummm yeah NO thats not where the deficit came from......... It came form the govt spending too much money on programs like those listed above . Its the same reason why all the Western European countries or broke as shit too.
              It certainly doesn't help when the gov gives big corporations big tax cuts but the little guys that own small businesses don't get any concessions at all.

              I absolutely agree that the problem isn't just the rich getting big breaks. But it's a vicious cycle when businesses take their operations out of the US for the sake of bigger profits along with the proliferation of big box retailers that kill off the entrepreneurs in small towns, all the while offloading their costs onto taxpayers. It is estimated that because of Walmart's policies, the average 200 employee store directly costs taxpayers over $420,000 a year. That's not taking into account sweetheart property and sales tax deals, either. There are over 2500 stores in the US. Do the math and you'll get over a billion dollars that they can clearly afford to be paying!

              This is a company that has quarterly revenues around $400 billion, yet they are still on corporate welfare.

              When wages fall to the point that a family with two children, both of whose parents are working full time, need taxpayer assistance just to subsist, something is wrong with the model. So they end up being pushed onto programs designed and funded to help people who can't work. This is an amazing abuse of the system brought to you by companies out to get every last drop of blood.

              Tell me that isn't part of the problem.

              Tell me this isn't another part of the problem.

              Tell me the fact that GE generated over 10B in pretax income, but owed nothing to Uncle Sam isn't goofy.

              I paid a 5 figure sum to the IRS last year and I am not rich. But I am a little guy, so I can't afford to buy my own politicians, nor do I have the budget for an army of tax attorneys.

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                #8
                ^Flip side is, would they stay headquartered in the US if the actually had to pay the 35% rate (2nd highest in the world). I don't know?

                The part of it that irks me the most is that while CEO/Executive level pay has increased something like 10x since the 70s, but the middle/lower class workers have actually seen their REAL WAGES lessen over time.
                Need parts now? Need them cheap? steve@blunttech.com
                Chief Sales Officer, Midwest Division—Blunt Tech Industries

                www.gutenparts.com
                One stop shopping for NEW, USED and EURO PARTS!

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                  #9
                  ^^^Of course, the flip side to the flip side is if they aren't providing a boost to the economy of this country, and seem to take great pains at avoiding any possible tax liability, who cares where they are located?

                  And I agree with you on wages. They aren't even stagnant! They're under siege.

                  Comment


                    #10
                    Who the Hell is TrimTabs?
                    Originally posted by Gruelius
                    and i do not know what bugg brakes are.

                    Comment


                      #11
                      Originally posted by mar1t1me View Post
                      ^^^Of course, the flip side to the flip side is if they aren't providing a boost to the economy of this country
                      Though that ignores the jobs and taxes of those employed. In your 200 employee store scenario where it costs the locale $400k, if all 200 made $10/hr that's approx $4.1 mil in salaries.

                      And that's estimating super low. My buddies wife is a asst manager at a Wal-mart here and she makes decent money.

                      So is it worth it to a community to forego $400k in money to add millions in payroll, and hundreds of thousands in sales tax/property tax/etc?
                      Need parts now? Need them cheap? steve@blunttech.com
                      Chief Sales Officer, Midwest Division—Blunt Tech Industries

                      www.gutenparts.com
                      One stop shopping for NEW, USED and EURO PARTS!

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                        #12
                        My problem with taxes in general is what they are used for. Maybe I'm blind, but the dollars spent on "programs" seems like a huge waste.
                        i'lldoitforacaravan

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                          #13
                          ^Yep we should be spending money on education and infrastructure.


                          Another thing that has always baffled me about unemployment. Granted when you are unemployed you are looking for work (will be optimistic here), but it doesn't take 40 hours a week to look for a job.

                          Why not take people on unemployment and have them put in 15-20 hours a week removing graffiti, cleaning parks, picking up trash or any other job that doesn't need a highly trained or specific skill set.
                          Need parts now? Need them cheap? steve@blunttech.com
                          Chief Sales Officer, Midwest Division—Blunt Tech Industries

                          www.gutenparts.com
                          One stop shopping for NEW, USED and EURO PARTS!

                          Comment


                            #14
                            Originally posted by delfin View Post
                            You realize that the top 1% make 30% more today than they did in 1960, right? They get taxed less, and make more. That's where your deficit comes from. Who the fuck needs to make over a BILLION dollars a year? NO ONE does. I couldn't even spend that much if I tried. I'd buy like 100 cars, an island, a castle, a few houses, and still have over half of it left.
                            where the hell do you think investments and economic expansion come from? savings from the rich (and all classes from that matter) tend to be lent out again in a productive cycle. Those who bust their ass accumulating all this wealth are better decision makers on what to do with it than the average jackass who envies them including uncle sam.

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                              #15
                              Originally posted by z31maniac View Post
                              ^Flip side is, would they stay headquartered in the US if the actually had to pay the 35% rate (2nd highest in the world). I don't know?

                              The part of it that irks me the most is that while CEO/Executive level pay has increased something like 10x since the 70s, but the middle/lower class workers have actually seen their REAL WAGES lessen over time.
                              If you count state taxes ontop of the federal rate of 35% then that rate is actually equating to 50%. all the more incentive (or lack of) for me to work for someone than be like my honorable boss who bust his as 24/7 to keep the company he started afloat








                              *exactly why variable rate taxes are never a good thing

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