The Benefits of Tax Increase on the Wealthy and Its Impact on the Middle Class in the TED Talk on Income Inequality by Nick Hanauer

In A TED Talk on Income Inequality by Nick Hanauer, speaker Nick Hanauer details the benefits of increasing taxes on the wealthy and how it could greatly impact the middle class. He uses a presentation with graphs showing the increase of unemployment numbers compared to the decreasing tax rate of Americans. In Hanauer‘s speech, he continues to detail how capitalists and business owners do not truly contribute to a healthy economy. He explains how only consumers and the markets of demand move the economy He specifically says, “—we’ve had it backwards for the last thirty years,” stating that ever since the tax rate of the wealthy has been decreasing, many Americans have begun to struggle. Towards the end, Hanauer summarizes that we should increase taxes for the wealthy to allow the middle class to thrive again.

Mr. Hanauer has failed to recognize that middle class Americans are struggling to other factors outside of taxation on the wealthy which include present-day trading laws, current tax positions for middle class Americans, and the loss ofjobs by regulation of non-American world economic powers. One massive factor Hanauer has not recognized is the disability middle class Americans has on the oppottunities they otherwise would have. In the fourth minute, Hanauer clarifies how capitalists pay only 15 percent of their capital gains in taxes whereas ordinary Americans pay 35 percent for their hard work. One proposal that he could, and should, have made was to give ordinary Americans the proper spending ability in capital investments to share in the profit with the upper classes, In place of shifting around tax brackets and percentages, it shall be proposed to take a fresh approach to laws limiting individuals from investing and taking opportunities they otherwise would not be allowed to take legally.

Ever since the Great Depression in the early 1930‘s, Americans have been put on a strict notice for taking out loans and buying shares of stock on margin. This however went into greater detail on how loans are allowed to be given out and how much power the Federal Reserve has over interest rates and banks that regulate these loans. In this new proposal, it shall be made to accommodate middle-class Americans and limit their spending based on their earnings rather than completely disqualifying most of the middle class from being able to take reasonable loans out to investt “The Bankrate survey identified a number of factors that keeps people from investing. The biggest problem by far is that people don't have enough money to invest,” stated in CNN Money.lt was also stated that the markets tend to grow over time at a steady rate despite the downfalls and recessions in the articles. (Long)

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When ordinary Americans are given this new opportunity, they will be able to raise their overall earnings, retire quicker, and ultimately boost the earnings of the entire middle class overall. One of the greatest reasons why the upper class has grown so much these past few decades is because they are able to invest their money and take these opportunities whereas ordinary Americans are either uninterested or unable to do so. In summary, it should be proposed to both allow average Americans the privileges they otherwise don’t get and a tax hike for specifically those who earn the most in capital gains ranging from simple real estate to professional hedged investments Another factor of Hanauer’s speech was how tough current taxes are for middle class Americans Not only is it not proportional to how much they earn, but they are almost in the same percentage bracket as upper-class Americans.

It’s not just that upper class citizens have low taxes, but middle class citizens have a higher one than they really should. It shall be proposed that the tax rate of middle class Americans fall from the low 30s to the high teens in terms of percentage. ”Republicans are listening to the people of New York who know that high taxes inhibit economic growth and make it more difficult for families to make ends meet,” said Senate Majority Leader John Flanagan (R-Suffolk)‘ (Campanlle) From this article it shows how members of the New York legislature is looking to decrease taxes for the middle class There are arguments of how simply decreasing the tax rate for middle class earners will not single handedly solve the economic hardships hard working Americans face, however it is a good step at this time to help proportion the amount of taxes paid in respect to the amount earned Using this train of thought, middle class Americans will no longer have to nearly pay the same percentage of tax as upper class citizens do.

This is a significantly different approach than simply overtaxing the rich and giving the government more money to waste. There are tremendous sources of waste in the government especially when it uses its power to wage unnecessary war, build failed programs, and contribute to abuse of these tax dollars, The tax system should always end benefitting the tax paying people of America, “With the birth of the North American Free Trade Agreement in 1994, Mexico became a major recipient of outsourced U.Sr manufacturingjobs, Mexico is now a global leader in auto parts manufacturing and one of the world’s largest TV set producers. Now, with the startup of the Central American Free Trade Area (CAFTA) this January, analysts are anticipating another exodus of US jobs to south of the borderi UiS, household names such as Dell, IBM, Sara Lee/Hanes and Maytag have already been moving business into the Central American region." (Morley)

As you can see in this article from 2006, jobs have been migrating out of the United States for quite some time It will also continue to occur until someone changes the laws the put companies in this position Since these high paying jobs are moving abroad to cheaper destinations, such as Mexico and China, the middle class is not just suffering “job loss.” They are experiencing job loss in high paying industries from manufacturing cars to processors for smart devicesr To stop such a degrading course of action from further taking place in the next decades, it shall be proposed to lower taxes for corporations based on job reports verified with. This way, the government “rewards” companies who offer more verified high paying jobs and benefits to its employees and in turn will convince many of these companies to keep their plants in the US as they will not need to transport goods and have a lower tax rate to overcome the potential profitability from moving abroad.

In summary, it is agreeable that the middle class is not only shrinking but becoming weaker with each coming year. Compared to the upper classes, the middle class does not stand a chance in the amount of wealth it owns The problem isn‘t necessarily that the upper classes have stolen this wealth from the middle and lower classes simply because they are performing as they otherwise would be able to with the benefits of investment given by the current laws that stand We must not only allow the middle and lower classes to not only reap the same great benefits with a slightly looser loan ruling, but we must also protect and encourage the middle class‘s financial portfolios with reasonable tax cuts and laws to aide high payingjob creation and sustainability in the long run.

In final conclusion, Hanauer has made a great point as well as interpreted the situation in a very abstract way. There should have been more direct evidence of how the middle class is now suffering and exactly what needs to be changed rather than point fingers without considering any of those details at all. The proposals mentioned above may tackle what Mr. Hanauer has failed to do so, in his speech, for the growing problem of the middle class in a more sophisticated way backed up by more specific research with correlating details and ideas.

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