Chart of the Day

From The Atlantic:

The richer you are, the more you get from capital gains. This shouldn't surprise us. The top 0.1 percent of earners collect roughly half of all capital gains. Of course, these are highly pro-cyclical. In other words, capital gains boom when the economy booms and go bust when the economy goes bust. That's why the rich and super-rich got such a high share of their income from capital gains in 2000 and such a low share in 2009 -- it's not that other income fell or rose in those years, but that capital gains rose and fell.

But the rich have more rentier income. They have dividends. And interest. And rents. That's what makes up the "other" category -- along with business income from S-corporations, partnerships, and the like. The rich and super-rich aren't so different when it comes to this other investment income. It's outsized capital gains that separate the Hamptons from the helicopter-to-the-Hamptons crowd. 

With our current tax treatment of dividends and capital gains compared to earned income, somebody who makes $110,000 will probably pay a higher total percentage of their income in income and payroll taxes than Mitt pays on $20,000,000 a year.  That doesn't make sense to me.  Under the Ryan plan, most of the income of those top 400 filers above wouldn't be taxed at all on the federal level.  That's just stupid.