In part one (just below) I showed how middle class and lower class
Americans have suffered huge decreases in wealth and incomes, especially in the
last 35 years, while upper class Americans have made great gains. This has particularly affected
African-Americans whose family life has disintegrated, trapping them in inner
cities. To add to the misery of inner-city
life, in cities like Detroit, not
only has there been white flight, but those African-Americans who had somehow become
successful have also moved out.
Black murder-rates have now reached 10X those of other races, and blacks now account for 85% of all inter-racial crimes. Since almost all victims of black murders are blacks themselves, it behooves all races to try to work together to reverse these trends, even if radical measures are necessary
I identified four areas that can be worked on that are the
sources of the problem:
2. low and unskilled factory jobs have
disappeared in inner cities.
3. the wholesale decline of private sector
4. income tax rates have been cut drastically
since 1981 when the highest rate was 70%.
Some solutions will anger liberals; some will
anger conservatives. Cooperation and
compromise are necessary before our society disintegrates completely, even
though solutions some will call ‘radical’ are necessary.
1. the welfare state led to the
disintegration of the African-American family.
Since AFDC Welfare came into vogue with President Johnson’s
Great Society, the number of black children
born out-of-wedlock has reached almost 75%, whereas before AFDC, the
black rate was the same as the white rate, leaving us with a society in which
millions of fatherless, young black men roam.
The only solution to this problem is to leave AFDC in place
for those now receiving it, but end it for new recipients; and replace it with
emergency assistance for those needing temporary help, possibly for a period of
up to six months, which cannot be repeated for at least three years.
Inner-City Factory Jobs
The federal government should not only subsidize, but
guarantee investment in factories built by entrepreneurs in inner cities. The government should not only establish
tariff protection for products of these factories, but guarantee product sales
for the early years of production. We
subsidize farmers, and I can remember when cereal grains were burned, potatoes were dyed
blue, and milk was dumped.
Why not subsidize an activity that can help restore lost
neighborhoods and lost souls?
Restore the Health of Private Sector Unions
I chaffed when I was forced to join a union after I landed
my first good job, and later, as an owner of a business, I fought against any
attempt at unionization. It is only recently that I have come to
understand the state of income and wealth disparity in this country and to
understand the role of union decline in furthering this disparity.
Private-sector union membership has fallen from a peak of
35% of the total private industry labor force in 1950 to a little over 6%
today. There can be no doubt that the
decline in factory wages is somewhat keyed to the decline of unions.
Private-sector unionization must be encouraged by federal
legislation outlawing “right-to-work” laws as they affect unionization of
non-public workers. “Right-to-work” laws
should only be applied to public-sector workers. This means that “union shops” would be legal
in all states (they are illegal in 23 states), and new workers would be
required to join and support the existing union.
The Tax Code
The only direct way to ameliorate income and wealth disparities
is through income and estate taxes. I
know that some will say that increasing taxes will depress economic activity,
but I believe that that is only true for taxes on investment income, which I
would leave alone. I wish that certain
tax shelters and tax loopholes could be closed, because the upper 1% of income
earners actually pay less taxes than the next lower earnings group, however
that is a complex subject beyond the scope of this article.
The current top income tax rate on incomes over $400,000 is
39.6%, a recent increase from 35%. In
1981, before the Reagan tax cuts, the top rate was 70%.
I believe that a new top rate of 70% should be applied to
incomes exceeding $5,000,000 per year.
The current estate tax is 40% on estates exceeding $5,250,000. Because of the devastating effect high estate
taxes have on family-run farms and small businesses, I would leave this system
Note: All statistics presented in this and in my
preceding article are from recognized sources that were stated in previous
articles on these subjects in this blog.
Labels: Society in General, Wealth Inequality