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Originally Posted by Baraka_Guru
You don't agree with what? That there are tax advantages to you when you manage financial assets in certain ways? That by having few or no assets means you only have access to high-interest credit, loans, and mortgages? What exactly about that don't you agree with? Because these things do indeed cause the gap to widen. How do they not?
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I agree that taxes and interest rates have an effect in some cases. I don't agree with the claims these are the predominate reason for the gap.
It just occurred to me to actually look up the federal tax rates on income and capital gains. Until your income exceeds $34K this year, your income tax rate is actually lower than the rate on capital gains taxes. Add in various tax credits and the rates are even lower.
Income tax rates:
http://www.moneychimp.com/features/tax_brackets.htm
Capital gains tax rates
http://en.wikipedia.org/wiki/Capital..._United_States
That doesn't look to me like poor people are paying higher tax rates.
Quote:
Originally Posted by Baraka_Guru
Can you explain this further? I'm not sure what you're getting at.
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What I'm suggesting is to track the incomes of people with high school diplomas, associate degrees, bachelor degrees, etc over 20 years and that you will see that those with lesser education don't fare as well as those with advanced degrees. The same idea that some disciplines result in more income growth over time than others.