Why the rich get more rich.

These are notes from a "think progressive" article.

"President Bush lowered the top two marginal income tax brackets on the richest 2 percent of Americans and lowered the tax rate on capital gains and dividends which overwhelmingly benefits Americans making over $600,000 per year.

Taxable income after deductions and exemptions is approximately 88 percent of adjusted gross income for taxpayers making over $10 million per year, according to IRS data. Assuming Mr. Limbaugh is typical of his class in his deductions and exemptions, his taxable income from his known income would be $33.4 million. Applying the 2009 tax rates and the 2000 tax rates to an income of $33.4 million yields a difference of $1.5 million.

This estimate is conservative, as we only considered Rush’s wage and salary income, and didn’t take into account Rush’s savings from Bush’s lower capital gains rate. Over 98 percent of taxpayers making over $10 million a year have capital gains income, and the average income from capital gains for people at that income level is $15 million/year. Because we don’t have access to Rush’s tax returns, we don’t know how much Bush’s giveaways to the investor class are saving him, but it’s undoubtedly a lot."