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[Slappers Only]

China, fuck yeah?

 

[Dr. Pangloss]

Do you go grocery shopping? Do you buy clothing? Have you seen the prices of gold and silver lately? No inflation? That's where I stopped reading.

Nice selection of scarce resources you have there. Why not look at the CPI: ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt Notice the last column and then tell me we have an inflation problem.

 

[Gaborn]

The top 50% own 99% of the wealth in the country. the top 20% own 85% of the net wealth and 93% of the financial wealth in this country. And that was as of 2007, their shares have gone up since then.

Do you have a source for these claims?

Mgoblue - look at the chart you quoted, pages 24 and 25 of the PDF. In 1998-2000 the US did indeed take in more than it spent. I would be very happy to go to the spending levels from those years too. 19.1% of GDP, in 1998, and in 1999 18.5% and in 2000 18.2% of GDP. By contrast in 1998 the federal government took in revenue totaling 19.9% of GDP, 1999 19.8 and in 2000 a whopping 20.6% of GDP. I have no problem with spending 18.2% of GDP as we did in 2000.

 

[GaimeGuy]

Do you have a source for these claims?

Mgoblue - look at the chart you quoted, pages 24 and 25 of the PDF. In 1998-2000 the US did indeed take in more than it spent. I would be very happy to go to the spending levels from those years too. 19.1% of GDP, in 1998, and in 1999 18.5% and in 2000 18.2% of GDP. By contrast in 1998 the federal government took in revenue totaling 19.9% of GDP, 1999 19.9 and in 2000 a whopping 20.6% of GDP. I have no problem with spending 18.2% of GDP as we did in 2000.

http://sociology.ucsc.edu/whorulesamerica/power/wealth.html

See table 1

 

[Gaborn]

http://sociology.ucsc.edu/whorulesamerica/power/wealth.html

See table 1

Table 1 shows the top 1%, then the next 19% (so the top 20%) and then the bottom 80%. I don't see a way to parse the chart to say the top 50% control 99% of the wealth.

 

[jamesinclair]

Not at all. How is that fair? Look, let's say you have two men, both earn $50,000 a year and are basically the same in every way. A wife, 2 kids, etc. Identical. Let's say one of these people invests $15,000 they saved up on a business selling guacamole at baseball games. One of them puts the same money in stocks and bonds with a conservative portfolio and essentially earns an extra 5% a year on the money. The guacamole business tanks. Who has more wealth? The guy that played it smart and didn't take an unnecessary and stupid risk. The fact that the guy who played it safe has more money though doesn't mean he needs to be taxed even MORE. He has more wealth because he didn't piss it away on a stupid idea. He paid his taxes already, he just didn't lose the money he had left AFTER taxes.

It's not like the rich are making these huge amounts completely untaxed. They have 42% of the wealth because they SAVE it and lived within their means while earning a fortune. Or, alternately, their parents did that while they earned the money.

....so what stocks did he buy? Assuming theyre the only two people in the world, he had to buy stocks in the guacamole business.


And the problem doesnt lie in the people making 50,000 and investing pennies in stock. What a red herring.


Lets try a new example.

Guy A works 40 hours a week and makes $45,000, the US average.
Guy A gets taxed at 50% (to make the math easy, we know its around 31% depending on his deductions and such).
Guy A goes home with $22,500

$22,500 is supposed to let him pay rent, buy food, pay for gas etc etc.

*


Guy B is born with a golden spoon. Guy B turns 18 and gets $100 million.
Guy B takes his $100 million and puts it into a conservative portfolio, and makes a 5% return.
Guy B, doing absolutely nothing, makes $5,000,000 a year (we're using simple interest here to keep the math easy).
Guy B pays 15% on his taxes, much less than the 50% being paid above.
Guy B goes home with $4,250,000

Guy B needs to pay rent, buy food, pay for gas etc etc.



*
Lets assume for a second that $22,500 is the exact amount to cover rent, food and gas and stuff.

Guy A is done, he has zero left. Heavens forbid he break his leg or something, or we toss him into debtors prison.

Guy B splurges, and spends $100,000 on his basics. Bigger house, premium gas, better cheese etc.

Guy B now has $4,150,000 in the bank.....on top of the $100,000,000 he started out with.




Year 2.
Same exact scenario for Guy A. Ends the year with zero left over.

Guy B now has $104,150,000, he invests again, spends again, and ends the year, richer, AGAIN.



And this is why the system is broken.

The rich get richer. Everyone else is screwed, and is paying mroe taxes to boot.

 

[Jonm1010]

Do you go grocery shopping? Do you buy clothing? Have you seen the prices of gold and silver lately? No inflation? That's where I stopped reading.

This is exactly why discussing anything with you further is worthless. Any opposition to your assertions or the assertions of your "sources" is met with a brickwall where any counter-prevailing information is blocked from entering. You wont even entertain the possibility that there is merit to another point of view. Why even bother at this point?

 

[Missle59]

Not sure if I am going to be clear on my point, but here goes.

It's not like the rich are making these huge amounts completely untaxed. They have 42% of the wealth because they SAVE it and lived within their means while earning a fortune. Or, alternately, their parents did that while they earned the money.

Begin rant
.
.

So they got rich, because of savings alone? No corporate tax cuts, corrupt politics, unfair business practices, money schemes (e.g. pyramid schemes, etc.), tax evasion, moving jobs to low income countries, ending jobs for short term profits, cutting money on safety practices and equipment, and etc.

So none of this was part of it? They just had a big @$$ piggy bank that they threw their spare change in at the end of the week? Coupled with "good" business practices?

.
.
End rant

 

[jamesinclair]

Panama seems to be doing fine without a central bank, and I didn't link the backing to just gold, I said a basket of commodities. If Panama can do it with lower inflation rates than certainly it can be done, and it was done pre 1913. I'm well aware of the bank panics that happened, they were far from frequent, and they occurred 3-4 times from what I've read in a 40 year span. Again, Panama is a testament to being able to function for 100 years without a central bank and a lower inflation rate than the US. It can be done if people want it to be done. Shouldn't people be sick of paying no name insanely rich bankers money to issue our currency with interest? I just find it to be disgusting that the central banks in turn bail out their banking buddies and all is well in the world.\

I....

Cant believe I missed this.

You know why Panama doesnt need a central bank....?

Heres a hint:

What currency is used in Panama?



If you said "Balboa" you're trolling.

It's the US dollar.

"Panamanian banknotes, denominated in balboas, were printed in 1941 by President Arnulfo Arias. They were recalled several days later, giving them the name "The Seven Day Dollar." The notes were burned after the seven days but occasionally balboa notes can be found with collectors. These were the only banknotes issued by Panama and U.S. notes have circulated both before and since."

 

[Piecake]

I....

Cant believe I missed this.

You know why Panama doesnt need a central bank....?

Heres a hint:

What currency is used in Panama?



If you said "Balboa" you're trolling.

It's the US dollar.

"Panamanian banknotes, denominated in balboas, were printed in 1941 by President Arnulfo Arias. They were recalled several days later, giving them the name "The Seven Day Dollar." The notes were burned after the seven days but occasionally balboa notes can be found with collectors. These were the only banknotes issued by Panama and U.S. notes have circulated both before and since."

That's pretty hilarious. Talk about owned

 

[Mgoblue201]

Do you have a source for these claims?

Mgoblue - look at the chart you quoted, pages 24 and 25 of the PDF. In 1998-2000 the US did indeed take in more than it spent. I would be very happy to go to the spending levels from those years too. 19.1% of GDP, in 1998, and in 1999 18.5% and in 2000 18.2% of GDP. By contrast in 1998 the federal government took in revenue totaling 19.9% of GDP, 1999 19.8 and in 2000 a whopping 20.6% of GDP. I have no problem with spending 18.2% of GDP as we did in 2000.

Sure, but even if we did spend "only" 18.2% of GDP per year, we would have still run up deficits in 30 of the years between 1960 and 2008. Something would still have to change. In general, I think that the Clinton administration (and the Congress at the time) got the numbers right; the booming economy also helped their case.

 

[Epicus Failus]

...money schemes (e.g. pyramid schemes, etc.), tax evasion, moving jobs to low income countries, ending jobs for short term profits, cutting money on safety practices and equipment, and etc.

So none of this was part of it? They just had a big @$$ piggy bank that they threw their spare change in at the end of the week? Coupled with "good" business practices?
.
End rant

So, no one in the history of the United States got rich or wealthy without using dishonest methods? The top 1% are all crooks and thieves?

 

[speculawyer]

Here is my inflation theory . . . we are having simultaneous deflation and inflation at the same time.

The deflation is from the economic meltdown. Home prices having been falling for like 5 year straight now. That is fucking unreal. We actually beat the home price deflation of the great depression!.
http://blogs.wsj.com/marketbeat/2011/05/31/housing-shocker-home-prices-still-falling/

However . . . other prices are record highs. Oil, food commodities, and gold have all gone way up in price. Gold is up because of panic and gold speculation . . . there has been a lot of panic over debt crises, the financial meltdown, wars, etc. Oil is up because production is harder and harder yet demand continues to soar. The food commodities are up because of speculation and the price of oil. Oil is required for fertilizers, pesticides, powering tractors, transporting food, etc. Our agricultural system is basically a system for converting oil and sunlight and into food. We use around 10 calories of oil to make every 1 calorie of food and that oil price has gone way up.

Of course the Fed printing presses have been contributing to inflation some but not much, IMHO. If the Fed printing presses were a big contributor, that should apply to housing prices too, right?

So we have a really confused market with some deflationary aspects and inflationary aspects.

 

[Gaborn]

....so what stocks did he buy? Assuming theyre the only two people in the world, he had to buy stocks in the guacamole business.

I didn't say they were the only two people in the world. Just two people who were in functionally identical circumstances.

And the problem doesnt lie in the people making 50,000 and investing pennies in stock. What a red herring.

It was an analogy.

Lets try a new example.

Guy A works 40 hours a week and makes $45,000, the US average.
Guy A gets taxed at 50% (to make the math easy, we know its around 31% depending on his deductions and such).
Guy A goes home with $22,500

Ok.

$22,500 is supposed to let him pay rent, buy food, pay for gas etc etc.

*

Sure.

Guy B is born with a golden spoon. Guy B turns 18 and gets $100 million.

You're already not making an apples to apples comparison. Where the circumstances are different the results are different.

Guy B takes his $100 million and puts it into a conservative portfolio, and makes a 5% return.
Guy B, doing absolutely nothing, makes $5,000,000 a year (we're using simple interest here to keep the math easy).
Guy B pays 15% on his taxes, much less than the 50% being paid above.
Guy B goes home with $4,250,000

Guy B needs to pay rent, buy food, pay for gas etc etc.



*
Lets assume for a second that $22,500 is the exact amount to cover rent, food and gas and stuff.

Guy A is done, he has zero left. Heavens forbid he break his leg or something, or we toss him into debtors prison.

Guy B splurges, and spends $100,000 on his basics. Bigger house, premium gas, better cheese etc.

Guy B now has $4,150,000 in the bank.....on top of the $100,000,000 he started out with.




Year 2.
Same exact scenario for Guy A. Ends the year with zero left over.

Guy B now has $104,150,000, he invests again, spends again, and ends the year, richer, AGAIN.



And this is why the system is broken.

The rich get richer. Everyone else is screwed, and is paying mroe taxes to boot.

Ok, that is a fundamentally flawed example.


Let's take 2 guys both living in the same state both with approximately equal living conditions. Let's say they both make $45,000 a year.

Both win the state lottery, are the only two to do so and both take a lump sum of cash. There hasn't been a lottery winner in the state in a while so the pot is big, each gets $16 million after taxes. Guy A buys a new, much larger house in a nicer neighborhood, a new car, pays off his wife's student loans but doesn't dramatically change his life with the money. He takes early retirement, hires a financial planner and puts his money in the stock market. His family will live mostly off the dividends but his fortune is there for emergencies, and for his children when they grow up.

Guy B took the other road. He has his money now so he might as well spend it. He's spending millions on drugs, on hookers, (and a Divorce after the wife caught him with the latter) and is basically the second coming of Michael Carroll.

Now fast forward. Guy A's kids didn't earn the money but it's there, their dad is dead and there is still around $15 million left. They obviously didn't earn it but they didn't do anything to lose it either.

Guy B lost everything and left his kids with essentially nothing. They got jobs and at least finished high school but it looks like they're going to have a long hard life for a while.

Yes Guy A left money to his kids they didn't earn but so what? They were responsible and Guy B was not.

You are advocating the equivalent of 2 chocolate bars given to 2 children. Both are told they will get another chocolate bar tomorrow. 1 eats their whole bar right away. One eats half of it at once. After dinner the second child takes out their candy bar. The first child, on seeing the half a bar says "But I want a chocolate bar too!"

I'm not saying there is never exploitation and that the wealthy are all fantastic people, but usually wealth is acquired (and KEPT) through hard work and responsibility. It's easy to spend money, even a lot of it. It's hard to keep it and make it grow.

 

[Missle59]

So, no one in the history of the United States got rich or wealthy without using dishonest methods? The top 1% are all crooks and thieves?

I did not say that. I was rebutting the idea that the all richest people got there and stayed rich from only savings and investing. The idea that all rich people live some kind of frugal economic lives and pay taxes like little saints.

 

[jamesinclair]

You're already not making an apples to apples comparison. Where the circumstances are different the results are different.

Let's take 2 guys both living in the same state both with approximately equal living conditions. Let's say they both make $45,000 a year.
.

My example is the real world.

Yours is a fantasy.

We're talking about raising taxes on the millionaires and billionaires. But again, you keep throwing in the peons.

I'm not saying there is never exploitation and that the wealthy are all fantastic people, but usually wealth is acquired (and KEPT) through hard work and responsibility. It's easy to spend money, even a lot of it. It's hard to keep it and make it grow.

Ugh, I just pointed out how once you reach a certain point, you can buy EVERYTHING....and still make money off interest because its so hard to spend more than that.

Guy B bought a mansion, a luxury car, anything he wanted. As long as he spent elss than $5,000,000 a year (quite the challenge) hes richer next year.

EVERYBODY ELSE doesnt have that luxury. Theres nothing left over,and thats not with splurging, its with renting, using a 10 year old car etc etc


You can work your ass off, climb the ladder from $35,000 all the way to $85,000, save as much as possible....


And still end up with less than what Guy B did sitting on his couch because he started with a larger pie.

 

[GaimeGuy]

Mark Cuban became a billionaire by selling broadcast.com . I love Mark Cuban, but what the fuck did he "earn" his billions for? Complete bullshit, basically.

 

[Mudkips]

My example is the real world.

Yours is a fantasy.

We're talking about raising taxes on the millionaires and billionaires. But again, you keep throwing in the peons.

Taxing rich people more because they are rich is not fair.
Taxing everyone an equal amount (percentage-wise) is fair.
Closing loopholes and enforcing the existing tax code on everyone, rich or poor, is fair.

When people talk about a "fair tax" and cry about taxing the wealthy more, they undermine any argument they could possibly have. That's not what the word "fair" means. That's a angry, spiteful, jealous tax. Not a "fair" tax.

 

[Gaborn]

My example is the real world.

Yours is a fantasy.

We're talking about raising taxes on the millionaires and billionaires. But again, you keep throwing in the peons.

We aren't though. Income tax taxes... income. You're upset that the wealthy have more wealth. The problem is what you're essentially saying is that the people that paid their taxes, the government GOT it's money should then have to pay AGAIN for the "crime" of not spending that money again faster than they took it in. That simply doesn't make sense. You're right, people with less money have a more difficult time than people with more money. I know it sucks but that's the way it is. Punishing people for the size of their bank account is irrational.

Ugh, I just pointed out how once you reach a certain point, you can buy EVERYTHING....and still make money off interest because its so hard to spend more than that.

Guy B bought a mansion, a luxury car, anything he wanted. As long as he spent elss than $5,000,000 a year (quite the challenge) hes richer next year.

Sure, but the problem is your SOLUTION seems to be not merely raising taxes but, what? A tax on bank accounts? On merely the crime of possessing money within the US?

EVERYBODY ELSE doesnt have that luxury. Theres nothing left over,and thats not with splurging, its with renting, using a 10 year old car etc etc


You can work your ass off, climb the ladder from $35,000 all the way to $85,000, save as much as possible....


And still end up with less than what Guy B did sitting on his couch because he started with a larger pie.

Sure, but that's not Guy B's fault. That's capitalism. And it's better than NOT having the ability to start climbing economically and building your fortune like in North Korea or the Soviet Union.

 

[Epicus Failus]

You can work your ass off, climb the ladder from $35,000 all the way to $85,000, save as much as possible....


And still end up with less than what Guy B did sitting on his couch because he started with a larger pie.

So the fuck what?

Is your complaint anything more than "People have and others do not." Boo fucking hoo.

Welcome to life, dude. It isn't fair so go out, quit being a bitch, and get your pie. Do so in a legal manner of course.

 

[Plumbob]

I think that the estate tax should be eliminated and replaced with a new tax that deducts 100% of the value of assets (adjusted for inflation) that were bequeathed to the deceased individual, but that he/she did not earn. Let me try to explain.

Person A: born to a penniless family, makes a $10 million fortune. Has a child Person B to whom she bequeaths all her money when she dies in the year 2000

Person B: invests the money over his lifetime, ends up with $30 million in assets at death. Adjusted for inflation, these assets are worth $20 million in 2000, so the government claims half (15 million in modern dollars). Person C, child of Person B, receives only the money that Person B earned in the economy, and not Person A.

This policy could possibly be extended to generations that are alive during the life of the originator of the wealth, so that Person A could take care of grandchild Person C, whom she potentially adores, but not her great-grandchildren, whom she will never meet. It preserves the profit incentive while halting the endless accumulation of wealth, which I think leads to power disparities that are fundamentally unfair. The taxed money would go to fund food stampsfood /poverty reduction programs/other good stuff for people in need. What do you guys think?

 

[GaimeGuy]

Taxing rich people more because they are rich is not fair.
Taxing everyone an equal amount (percentage-wise) is fair.
Closing loopholes and enforcing the existing tax code on everyone, rich or poor, is fair.

When people talk about a "fair tax" and cry about taxing the wealthy more, they undermine any argument they could possibly have. That's not what the word "fair" means. That's a angry, spiteful, jealous tax. Not a "fair" tax.

actually, taxing everyone an equal percentage is not fair, because the marginal utility of a dollar decreases the more money you accumulate. Essentially, an extra $100 goes a lot further when you're living off $10k than it does when you're living off $1 million, both perception wise and in practice.

You tax everyone the same amount, you're treating the 100th dollar someone earns the same as the billionth. That's not fair.

 

[Jonm1010]

Taxing rich people more because they are rich is not fair.
Taxing everyone an equal amount (percentage-wise) is fair.
Closing loopholes and enforcing the existing tax code on everyone, rich or poor, is fair.

When people talk about a "fair tax" and cry about taxing the wealthy more, they undermine any argument they could possibly have. That's not what the word "fair" means. That's a angry, spiteful, jealous tax. Not a "fair" tax.

Why is it not fair?

To quote Michael Sandel:

Lundborg: You point out that Chief Justice John Roberts makes $217,400 per year, while Judge Judy makes $25 million per year from her reality show. Is there anything unjust about that?

Rewards Bestowed

Sandel: Can we really say with moral seriousness or a straight face that Judge Judy in virtue of her contribution to the common good morally deserves to make that much more?

Lundborg: Is the market wrong, then?

Sandel: We sometimes confuse the rewards that markets produce with justice, with what people deserve, but there is no good reason to assume that the bounties markets bestow are necessarily fair.

Markets are not an end in themselves, and they are certainly not a source of justice. They could yield a particular distribution of income and wealth, and then it’s up to us collectively as a society to decide whether we want to leave that in place or redistribute.

 

[Gaborn]

I think that the estate tax should be eliminated and replaced with a new tax that deducts 100% of the value of assets (adjusted for inflation) that were bequeathed to the deceased individual, but that he/she did not earn. Let me try to explain.

Person A: born to a penniless family, makes a $10 million fortune. Has a child Person B to whom she bequeaths all her money when she dies in the year 2000

Person B: invests the money over his lifetime, ends up with $30 million in assets at death. Adjusted for inflation, these assets are worth $20 million, so the government claims half. Person C, child of Person B, receives only the money that Person B earned in the economy, and not Person A.

This policy could possibly be extended to generations that are alive during the life of the originator of the wealth, so that Person A could take care of grandchild Person C, whom she potentially adores, but not her great-grandchildren, whom she will never meet. It preserves the profit incentive while halting the endless accumulation of wealth, which I think leads to power disparities that are fundamentally unfair. The taxed money would go to fund food stampsfood /poverty reduction programs/other good stuff for people in need. What do you guys think?

Sooooo you're advocating eliminating family wealth... just because? The estate tax is dead and buried and it should stay dead and buried. Your system is even more punitive and fundamentally not right. The government never had any claim on that money whatsoever.

 

[Piecake]

Taxing rich people more because they are rich is not fair.
Taxing everyone an equal amount (percentage-wise) is fair.
Closing loopholes and enforcing the existing tax code on everyone, rich or poor, is fair.

When people talk about a "fair tax" and cry about taxing the wealthy more, they undermine any argument they could possibly have. That's not what the word "fair" means. That's a angry, spiteful, jealous tax. Not a "fair" tax.

Well, youll be glad to know that the ridiculously wealthy pay less of a percentage of their total income than a person making 50k a year. So its imperative that we raise their taxes to make it 'fair'

Personally, I find your definition of fair absurd. If everyone started on an equal footing coming into this world, then I might agree with you, but that is not the case. Rich people simply have much more opportunities, and since they have greater opportunities than the poor or middle class, they should be taxed to reflect that.

 

[99hertz]

Man, what I learned from all this is that when people try to explain this stuff to me in layman's terms, it just sounds like something an insane person would design. I think I'm going to watch some Khan Academy videos to understand all this stuff a little bit better.

 

[Joe]

So the fuck what?

Is your complaint anything more than "People have and others do not." Boo fucking hoo.

Welcome to life, dude. It isn't fair so go out, quit being a bitch, and get your pie. Do so in a legal manner of course.

you're such a good citizen, sticking up for the rich man.

 

[Plumbob]

Sooooo you're advocating eliminating family wealth... just because? The estate tax is dead and buried and it should stay dead and buried. Your system is even more punitive and fundamentally not right. The government never had any claim on that money whatsoever.

The policy isn't punitive. It's not jailing people for being born into rich families. Taking inherited wealth away from a baby isn't punishing them for being a rich baby. Poor or rich, they end up receiving similarly small fortunes.

In fact, I would say the far more punitive policy would be to deliberately place children born into poor families at an immediate social, economic, educational and competitive disadvantage "just because" they were born into the wrong family, when policy options like this one are available. "If you wanted opportunities and access to capital, you should have chosen your womb a little more carefully, kid."

 

[Slavik81]

I think that the estate tax should be eliminated and replaced with a new tax that deducts 100% of the value of assets (adjusted for inflation) that were bequeathed to the deceased individual, but that he/she did not earn.

To state it more simply, you mean that children can inherit their parents' estate but grandchildren can't then inherit it once more. I'm not sure I entirely agree with that. An estate tax that results in the value of inherited wealth diminishing over subsequent generations makes more sense to me.

A balance needs to be struct between allowing parents to provide for future generations, and to give all people an equal starting place in life.

http://sanders.senate.gov/newsroom/news/?id=9E2A4EA8-6E73-4BE2-A753-62060DCBB3C3

16 trillion dollars in bailout money from the Federal Reserve, much of which went to big banks. The system in my humble opinion is broken if we have to pay interest to the Federal Reserve for them issuing our currency. It constitutes perpetual debt, and we should issue our own currency, not a private banking cartel. It makes no sense.

That's article's such a farce and your interpretation is mistaken. It's not bailout money, those were overnight loans that were made and repaid repeatedly. With interest. It's a normal part of the banking system, not some sort of secret.

16 trillion also sounds like a lot more than it is. If I lent you a thousand dollars each night and you repaid me in the morning, by the end of the year I'd have lent you $365,000 dollars.

I don't have hundreds of thousands of dollars lying around, but I certainly could afford to lend you $365,000 if that's how you're accounting it. It's no more than a single $1000 loan for the year.

 

[Wall]

So the fuck what?

Is your complaint anything more that "People have and others do not." Boo fucking hoo.

Welcome to life, dude. It isn't fair so go out, quit being a bitch, and get your pie. Do so in a legal manner of course.

No, the point is that we have a federal government that provides many benefits including, but not limited to, defending the country, maintaining and building infrastructure that we all use, enforcing laws aimed at guaranteeing public safety, investing in scientific research, assisting in the funding of education, and operating social programs aimed at guaranteeing a minimum standard of health and well being for all citizens.

We fund this organization through a system of progressive taxation so that taxes do not unduly burden any particular individual. Basically, since 5,000 dollars means a lot more to a person making 20,000 dollars a year than a person making 300,000 dollars a year, we tax these individuals at different rates.

A flat tax would either not bring in enough revenue to fund the federal government, or it would put an undue burden on individuals below a certain income level.

Incidentally, the moral and practical principals behind progressive taxation date back hundreds, even thousands of years. Adam Smith favored progressive taxation.

 

[hayejin]

*


Guy B is born with a golden spoon. Guy B turns 18 and gets $100 million.
Guy B takes his $100 million and puts it into a conservative portfolio, and makes a 5% return.
Guy B, doing absolutely nothing, makes $5,000,000 a year (we're using simple interest here to keep the math easy).
Guy B pays 15% on his taxes, much less than the 50% being paid above.
Guy B goes home with $4,250,000

Guy B needs to pay rent, buy food, pay for gas etc etc.

Did 100 million just magically appear out of thin air?
The parents of Guy B would have already paid tax on the money they earned just like everyone else. Why should the 100 mil. the parents saved from their after tax income be taxed again??

 

[Gaborn]

The policy isn't punitive. It's not jailing people for being born into rich families. Taking inherited wealth away from a baby isn't punishing them for being a rich baby. Poor or rich, they end up receiving similarly small fortunes.

In fact, I would say the far more punitive policy would be to deliberately place children born into poor families at an immediate social, economic, educational and competitive disadvantage "just because" they were born into the wrong family, when policy options like this one are available. "If you wanted opportunities and access to capital, you should have chosen your womb a little more carefully, kid."

You misunderstand me. It's punitive in the sense that you're not allowing people (the deceased) to do as they wish with their own money. Some people may not like their children for example so they pass them over for the grand children. There was the Saginaw lumber baron that hated his whole family and said that his $100 million fortune was to be distributed 21 years after his last grandchild's death to his descendants. And, in the end, whatever you think of a grand child's claim to wealth the GOVERNMENT has absolutely no claim to it.

 

[Phoenix]

actually, taxing everyone an equal percentage is not fair, because the marginal utility of a dollar decreases the more money you accumulate. Essentially, an extra $100 goes a lot further when you're living off $10k than it does when you're living off $1 million, both perception wise and in practice.

You tax everyone the same amount, you're treating the 100th dollar someone earns the same as the billionth. That's not fair.

Nice. Someone who actually understands economics. This conversation may be interesting after all

 

[Wall]

Did 100 million just magically appear out of thin air?
The parents of Guy B would have already paid tax on the money they earned just like everyone else. Why should the 100 mil. the parents saved from their after tax income be taxed again??

It is a transaction. Governments tax transactions. For example, I live in Pennsylvania. It has both and income tax and a sales tax, meaning that citizens of the state pay taxes on the money they earn both when their employer pays them, and when they use that money to buy things. It is the same principal.

 

[Piecake]

Did 100 million just magically appear out of thin air?
The parents of Guy B would have already paid tax on the money they earned just like everyone else. Why should the 100 mil. the parents saved from their after tax income be taxed again??

the 100 million isnt taxed, just the profit he makes on his investments. Considering that the most wealthy in the US's income comes mostly from capital gains, the gains on that should be taxed. Hell, it might make them do something actually useful with that money, like start a business, create jobs, invest in a business venture, etc

 

[Plumbob]

You misunderstand me. It's punitive in the sense that you're not allowing people (the deceased) to do as they wish with their own money. Some people may not like their children for example so they pass them over for the grand children. There was the Saginaw lumber baron that hated his whole family and said that his $100 million fortune was to be distributed 21 years after his last grandchild's death to his descendants. And, in the end, whatever you think of a grand child's claim to wealth the GOVERNMENT has absolutely no claim to it.

I guess we have incompatible viewpoints. I think one of the jobs of government is promoting the welfare of its people. If respecting somebody's rights interferes with our ability to promote the greater good, then perhaps we should reconsider whether those rights are actually legitimate. The right to own property resonates a bit too much as a cultural construct for me to make it the ultimate linchpin of my moral choices. It's just part of a larger body of social rules that we use to get along with one another and live happily. If those rules can be modified to work better, then they should, even if they are very strong cultural constructs. Things like starvation and disease, however, aren't cultural constructs, and won't simply go away if we stop believing in them.

 

[War Peaceman]

You misunderstand me. It's punitive in the sense that you're not allowing people (the deceased) to do as they wish with their own money. Some people may not like their children for example so they pass them over for the grand children. There was the Saginaw lumber baron that hated his whole family and said that his $100 million fortune was to be distributed 21 years after his last grandchild's death to his descendants. And, in the end, whatever you think of a grand child's claim to wealth the GOVERNMENT has absolutely no claim to it.

But he made his money in the USA right? Where the government had (Or helped with ensuring)ensured that there was an appropriately educated set of employees, a domestic situation which was stable for working as well as for the lumber business itself. So surely some of those personal profits he made should be reinvested into the state/federal income in accordance with the benefits he and his business received?

 

[Gaborn]

I guess we have incompatible viewpoints. I think one of the jobs of government is promoting the welfare of its people. If respecting somebody's rights interferes with our ability to promote the greater good, then perhaps we should reconsider whether those rights are actually legitimate. The right to own property resonates a bit too much as a cultural construct for me to make it the ultimate linchpin of my moral choices. It's just part of a larger body of social rules that we use to get along with one another and live happily. If those rules can be modified to work better, then they should, even if they are very strong cultural constructs. Things like starvation and disease, however, aren't cultural constructs, and won't simply go away if we stop believing in them.

You're right, we do have incompatible views. You seem to believe in positive liberty, that is, that our rights flow from government and the associations it allows and thus our freedoms flow from them - and can be taken away by the government. This view also allows things like banning private discrimination, smoking bans in bars and restaurants, etc.

As a libertarian I believe in negative liberty that is, that I have the right to life, liberty, and property (as well as the pursuit of happiness) and it's not something "bestowed" on me because my rights don't come from the government. It is my strong and sincere belief that free individuals are free not because a hierarchy of government tells them so and gives them permission to do things.

I believe I am free and therefore I should have the right to live my life as I wish so long as my decisions do not infringe on the rights of another. That if I own a bar or restaurant I have the right to smoke and allow others to do so or not do so and you have the right to go elsewhere if you disapprove. The government exists, but it does not grant rights. The government is essentially an arbiter, it defines rules for social interactions, punishes those who infringe on the liberty of others and otherwise acts in ways that restrict liberty.

A person who believes in positive liberty might for example conclude that narcotic's use carries risks and in some cases can lead to self harm or even direct threats to others and thus it is a legitimate function of government to restrict a person's access to narcotics. A person who believes in negative liberty understands that the decision to use or not use a narcotic should be up to the individual, that if you harm another because of your narcotics use it may lead to legal sanction but the decision, as a rational thinking adult should be yours.

and as much as I've enjoyed this discussion I'm heading to bed now.

vcassano - The government doing it's job does not entitle it to a tip. You pay taxes for things like police and fire protection locally and nationally a military.

 

[Wall]

I think that looking at progressive taxation as a method of "punishing" people is the wrong way to look at it. The policy is really part of a broader economic and political philosophy, developed over time and in response to the mistakes and crisis of the past, that guides how we make decisions and enact policies in those areas.

Basically, we've found that, left to its own devices, a completely "free market" is unable to distribute goods and services in such a way so as to guarantee stability and a minimum standard of living in a modern economy. We've also found that markets are useful devices for distributing resources in a society, so, despite their shortcomings, we make heavy use of them. We use the public sector to provide services in areas where the market fails. In order to fund this apparatus, we tax individuals at different levels since they have differing abilities to pay.

The completely "free market" solution to market failures would be to simply let individuals die, if, for example, they lost their job and were unable to afford to pay for a sudden illness.

 

[I H8 Memes]

Even the crazies the Tea Party elected wont let us default by not raising the debt ceiling. Unfortunately they wont have to bend at all to raise it. I fully expect the Democrats to cower in front of the Republicans and agree to a deal that has no tax increases to the wealthy and massive cuts to everything but defense spending.

 

[unomas]

This is exactly why discussing anything with you further is worthless. Any opposition to your assertions or the assertions of your "sources" is met with a brickwall where any counter-prevailing information is blocked from entering. You wont even entertain the possibility that there is merit to another point of view. Why even bother at this point?

Discussing anything with you at any point in this thread is worthless if you can't even see something as simple as inflation. To ignore the simple facts is beyond insane, and yet you pretend to be receptive to information when you're beyond understanding even the most basic of monetary concepts. Enjoy your inflation and QE3, the blindness caused by the American ego is never to be underestimated.

 

[unomas]

I....

Cant believe I missed this.

You know why Panama doesnt need a central bank....?

Heres a hint:

What currency is used in Panama?



If you said "Balboa" you're trolling.

It's the US dollar.

"Panamanian banknotes, denominated in balboas, were printed in 1941 by President Arnulfo Arias. They were recalled several days later, giving them the name "The Seven Day Dollar." The notes were burned after the seven days but occasionally balboa notes can be found with collectors. These were the only banknotes issued by Panama and U.S. notes have circulated both before and since."

Panama doesn't need a central bank because of the US dollar? Please connect the dots for me on exactly why that's the reason they don't need a central bank? And why exactly Panama has had a lower rate of inflation than the US for the last 20 years despite using the almighty dollar.

 

[Clevinger]

Even the crazies the Tea Party elected wont let us default by not raising the debt ceiling. Unfortunately they wont have to bend at all to raise it. I fully expect the Democrats to cower in front of the Republicans and agree to a deal that has no tax increases to the wealthy and massive cuts to everything but defense spending.

In most cases I don't wish to defend the Democrats' spinelessness, but not here. At least, not fully. It's hard to negotiate with someone who toys with sending the world economy into turmoil if they don't get their way. Democrats could try and call their bluff, but it's sadly not out of the realm of possibility that the House Republicans wouldn't be reigned in on time by Boehner.

 

[Dead Man]

Let's be accurate. The top 1% controls around 42% of the wealth in the US. That's a huge number but let's at least be accurate.

Given that, should they not be paying 42% of the taxes? Do you have figures for how much wealth the top 0.1% controls?

 

[GaimeGuy]

In most cases I don't wish to defend the Democrats' spinelessness, but not here. At least, not fully. It's hard to negotiate with someone who toys with sending the world economy into turmoil if they don't get their way. Democrats could try and call their bluff, but it's sadly not out of the realm of possibility that the House Republicans wouldn't be reigned in on time by Boehner.

based on what happened here in Minnesota, the republicans would totally let us default.

 

[Trakdown]

Even the crazies the Tea Party elected wont let us default by not raising the debt ceiling.

Minnesota Rep. Michele Bachmann says she wouldn’t vote to raise the debt limit — and is dismissing concerns that the nation would default on its loans as “scare tactics.”

Appearing on CBS’s “Face the Nation” on Sunday, the GOP presidential candidate cited federal spending as a top concern and said she believed the country would still have the revenue to meet its debts and obligations.

“It would be very tough love,” she said of a “no” vote.

But, she added: “I’ve been in Washington for a long time, and I’ve seen smoke and mirrors time and time again.”

http://www.politico.com/blogs/politicolive/0611/Bachmann_default_concerns_scare_tactics.html

 

[subversus]

based on what happened here in Minnesota, the republicans would totally let us default.

what happened in Minnesota? I'm out of touch with internal US politics.

edit: oh, I see.

edit2: is she stupid?

 

[Trakdown]

what happened in Minnesota? I'm out of touch with internal US politics.

edit: oh, I see.

edit2: is she stupid?

Gaimeguy's probably referring to the Gov't. shutdown that was forced in Minnesota recently. And I think it's less that she's stupid and more that she's as insane as a Batman villain.

 

[GaimeGuy]

what happened in Minnesota? I'm out of touch with internal US politics.

edit: oh, I see.

edit2: is she stupid?

We had an estimated $5.5B budget deficit.

We cut spending, forced state employees to contribute more to pensions, decreased health care benefits, etc

Eventually we had it down to $1.4B.

The governor (a democrat) wanted to cover that deficit by increasing taxes on the top 1.9% (individuals making more than $500,000 a year).

Republicans, who control both houses of the state legislature, have taken a no-taxes stance, though, and as a result, a budget solution was not passed for the new fiscal spending period, and the government shut down for about 2 weeks.

In the end, the governor caved, and agreed to the republican proposal to make up the remaining $1.4B deficit by extending the school shift by $700M and borrowing $700M through new tobacco bonds.

 

[subversus]

We had an estimated $5.5B budget deficit.

We cut spending, forced state employees to contribute more to pensions, decreased health care benefits, etc

Eventually we had it down to $1.4B.

The governor (a democrat) wanted to cover that deficit by increasing taxes on the top 1.9% (individuals making more than $500,000 a year).

Republicans, who control both houses of the state legislature, have taken a no-taxes stance, though, and as a result, a budget solution was not passed for the new fiscal spending period, and the government shut down for about 2 weeks.

In the end, the governor caved, and agreed to the republican proposal to make up the remaining $1.4B deficit by extending the school shift by $700M and borrowing $700M through new tobacco bonds.

it sounds so evil and fucked up. I knew that taxing rich is a hot issue in US but I didn't know how crazy some republicans are.

In the end those who don't share go down (or flee) in the most painful way. The law of history.