They 'captured ' that income huh? Didn't earn. ( good grief).
In the top end? Actually, yes.
Many of the top earners are collecting economic rents, not generating value. Hedge funders, financial workers, those who live off of asset income, make up most of the top 1% of income earners, and are rentiers.
Hedge funds typically make "2 and 20," or 2% of assets under management and 20% of any capital gains. To "earn" this, they pursue strategies that add little or nothing to the economy, like currency arbitrage, or exploiting pending trades via high-frequency schemes. (Their returns sucked in 2015 by the way, barely beating the S&P 500 by enough to cover what they charge customers.)
Companies that Make Real Stuff can still be unjustified in pay. Not all, e.g. the someone like the CEO of Caterpillar helps his company build real-world tools that produce real-world economic benefits. Even so, 1/3 of Cat's shareholders slammed the executive compensation scheme. In a year when the company's stock trailed the S&P 500 and returns were lacking, the CEO got a 14% bump in pay to $17 million.
The CEO Pay to Median Employee Pay Ratio for Cat was 71:1. That is well above the average company in the 1970s, sucks compared to a knowledge-based company like Amazon (18:1), but is not bad compared to Walmart (1000:1).
Just because somebody make more money why is it FAIR that they owe more to the GOvernment?
1) They're paying a percentage of income. Not sure why that strikes you as particularly unfair.
2) Taxes are a corrective to income inequality, which is highly corrosive when it becomes too great. And yes, income inequality is bad for the economy as a whole. (e.g.
Why Inequality Is Bad for Economic Growth - US News)
3) As you go up the income scale, more and more of their income winds up doing nothing. It sits on the sidelines, it's just surplus. Aside from the inequality portion, it's bad economically.
4) In order to make all that lovely money, they need to rely greatly on a broad array of government services and protections.
5) The more money you have, the more you can pay your accountants to reduce your tax liabilities. Most of the 1% have the same effective tax rates as the top 20%. But as you get further into the stratosphere, your tax liabilities go down:
6) Almost all of the income gains since the 1970s have gone to the top executives (and financial types). Worker productivity has gone up, but their cut of wages has not. It is also an illusion that the executives "create value." The CEO doesn't often change performance much; and for every Jeff Bezos and Steve Jobs, there is a Tim Cook (who can do an adequate job of running Apple) and a Bernie Ebbers (who drove Worldcom into the ground).
If 10 people are eating at restaurant, and the restaurant made the richest person pay 80 % of the total bill, would that be 'fair" ?
Since that doesn't describe the American economy, I'm not sure what you're trying to illustrate here.
You have 10 workers at the restaurant. 3 are low-skilled (busboys), 3 are medium-skilled (wait staff), 3 have advance training (chefs), 1 ties it all together (manager). It makes sense that the busboys get paid less than the wait staff, who get paid less than the chefs, who get paid less than the manager. It does not make sense that the manager should earn 80% of all the wages.
