Income Tax and the Rich Myth (Liberals Read)

• sleeper

  

  Capital gains taxes should be 0%. Income taxes should be eliminated entirely and replaced with a national 1% sales tax on all purchases. Spending should be cut drastically including reforming Medicare, Social Security, and defense.
  
  There, I just fixed America.
• fish82

  

  BoatShoes;815907 wrote:The sad thing is I gather from your posts that you consider yourself an Austrian and yet you are totally unaware of their major contribution to mainstream economic theory with the marginal revolution. There's no point into posting all of it again as I've posted it over again. You also seem unaware of the reality of compounding of economic growth over the years as the only ones seeing significant growth since 1975 when a CEO's pay was 3 times the average worker and is now 400 times the average worker. That bottom 50% in your table would gladly pay more taxes if it meant that their pay was in its former ratios.
  
  But as to the law of diminishing marginal utility which, even if higher income earners are paying a larger percentage of their income, still stipulates that they are giving up far less utility to the government.
  
  wealth and income inequality reduces the sum total of personal utility because of the decreasing marginal utility of wealth. For example, a house may provide less utility to a single millionaire as a summer home than it would to a homeless family of five. The marginal utility of wealth is lowest among the richest. In other words, an additional dollar spent by a poor person will go to things providing a great deal of utility to that person, such as basic necessities like food, water, and healthcare; meanwhile, an additional dollar spent by a much richer person will most likely go to things providing relatively less utility to that person, such as luxury items. From this standpoint, for any given amount of wealth in society, a society with more equality will have higher aggregate utility. Some studies (Layard 2003;Blanchard and Oswald 2000, 2003) have found evidence for this theory, noting that in societies where inequality is lower, population-wide satisfaction and happiness tend to be higher.
  
  It is also erroneous to solely focus on income because, as noted before, the compounding growth in conjunction with decreasing tax rates for higher income earners has allowed those very rich to expand their net worth tremendously so has to have 80% of the wealth of this country (assets - liabilities).
  
  You also fail to point out the even more telling factoid of your chart...the massive inequality between the top 1% and .1% between even the top 5% because the top 5% are often ordinary income earners whereas those in the higher percentages have a lower effective rate in the form of capital gain and qualified dividends.
  
  
  
  Overall, no one disputes that the wealthier pay more taxes but when the top 10% earns 45% of the nation's income and the bottom 50% earns 12.7% and those ratios get farther and farther apart compounding over 20 years, combined with the catechism that you could never raise taxes on that bottom 50% of course they're not going to pay taxes. Once the bush tax cuts are about to expire again a Conservative will be on here talking about the largest tax increase in history...and then a month later talk about how no one pays taxes.
  
  I mean MajorSpark did taxes for a guy who earns $50k a year and he got a tax refund....you saying those kinds of hard working families who haven't had their wages rise in 20 years wouldn't love to pay some taxes if he got a $30,000 raise...and his wife probably works too!
  
  I mean, are you really proposing that we raise the taxes on the bottom 50% of americans? Go ahead and propose it...Especially when they get so much more utility out of their dollars....that 10% of their AGI that they keep is going purely towards consumption for most of them as evidence by the lack of saving over the last 20 years.
  
  You want the bottom 50% to pay more taxes but you will not support any policies that would increase their hiring...you do not demand that their bosses who use essentially slave labor instead and earn 400 times what they do pay them higher wages. You decry labor unions despite Taft-Hartley bringing along the snow ball of the steady demise of the American middle class.
  
  Again, I'm sure you're going to talk to me about the worthless bums who stroll into my gf's bank to get their SSI check...as if that is the source of our problems.
  
  I mean it makes no sense to focus solely on income.
  
  Dr. John Rutledge, an economist, was one of the principal architects of the Ronald Reagan economic plan in 1980-81 and was an advisor to the George W. Bush White House on tax policy. He now runs his own private equity investment firm. He did an analysis of the Fed's z1 form which tracks the balance sheet of the U.S. economy. In the awful year that was 2008 our people had 188 trillion dollars worth of national assets. That dwarfs our national debt and is a better ratio than countless successful businesses...but yet we're hearing cries of our impending bankruptcy...because our debt is approaching our yearly national income. Add in that $141 trillion of those assets are financial assets.
  
  
  
  Most of our people as individuals have negative net worth let alone debt greater than their annual income!
  
  Now think about that...The top 10% have control over 93% of $141 trillion worth of financial assets. They have so much money that it has incredibly low utility in comparison to the average american. They don't even feel the pain of their taxes in the same way most taxpayers do if they lose a $10 bill. This is basic economics and the thing that put the Austrian School on the map.
  
  http://3.bp.blogspot.com/_RSMVZRZECdI/TNGDgmEht5I/AAAAAAAACGI/E1veBkaNkqM/s400/wealth.distribution.2007.graph1.gif
  
  The bottom line is this: The United States is the most powerful nation the world has ever known and it was founded upon a merit conception of justice...that people are rewarded for what they earn and produce as free individuals with rights bestowed from God. America's workers are our producers...that bottom 80% with no wealth to speak of...are among the most talented and skilled and educated and productive that you will find, despite the lack of investment in their education each and every year and nearly all of them besides the glaring examples we're all too well aware of...aren't looking for a handout and never have. Yet, since 1975...despite working just as hard and growing our economy throughout that time....they have not been rewarded for their efforts...And despite, if we were to look at our national balance sheet which is not dire at all (as opposed to our yearly debt to income ratio)...the national debate has centered around destroying medicare and raising their taxes because high income earners (which includes a miniscule percent of the tea party) are "taxed enough already" when that clearly is not the case if you consider, aggregated wealth, compounding of wealth over years and the law of diminishing marginal utility.
  
  Most of America is on hard times but a very few don't have a care in the world and they are the one's with all of the power and both the democrats and republicans are in their back pocket. But I dunno...it's like Peter Finch said in the film network...we come home and we turn on our tube's...these days the internet, and we have the whole world at our fingertips and maybe we just don't care.
  
  
  
  Apologies for the long reply as you won't be convinced anyway. I'll take some inadequate health care vouchers and lose my tax expenditures so George Soros can have a 0% Tax Rate on his income and we can have a balanced budget 30 years from now! Maybe he will spend it on a SuperPAC!

  Dude. :rolleyes:
  
  War & Peace aside, it's called Income Tax, not Wealth Tax. Unless you plan to force all the rich people to sell their shit and give the money to the gumbint, you just wasted some serious bandwidth.
  
  Or as I've said before, just kill them and take their money. Either way, the whining groweth old.
• I Wear Pants

  sleeper;816313 wrote:Capital gains taxes should be 0%. Income taxes should be eliminated entirely and replaced with a national 1% sales tax on all purchases. Spending should be cut drastically including reforming Medicare, Social Security, and defense.
  
  There, I just fixed America.

  You are a crack addict.
  
  Fish, I enjoyed the Tolstoy joke.
• Sage

  

  From 1980 to 2005, 80% of new income generated in this country went to the richest 1%.
  .......................................................
  
  Also, I love this idea that the uber rich are some how hard workers. Do you know any uber rich people? They don't work. Their money works for them.
  
  Did Les Wexner work super hard to build something like Easton? Or was he just fortunate enough to have enough money in his bank account to write a check.
  
  gg $$ to BoatShoes, who just destroyed whoever posted this inane thread.
• sleeper

  

  Sage;816330 wrote:From 1980 to 2005, 80% of new income generated in this country went to the richest 1%.
  .......................................................
  
  Also, I love this idea that the uber rich are some how hard workers. Do you know any uber rich people? They don't work. Their money works for them.
  
  Did Les Wexner work super hard to build something like Easton? Or was he just fortunate enough to have enough money in his bank account to write a check.
  
  gg $$ to BoatShoes, who just destroyed whoever posted this inane thread.

  
  So they just magically woke up one day and had billions of dollars? Where do I sign up?
• I Wear Pants

  God damn it people. The poor are not all lazy untalented assholes and the rich aren't all people that don't work. The vast majority are wealthy because they are talented/hard working or a combination of that. However, I think that the same isn't necessarily true about the poor. I have no problem with people being poor if they are not talented or hard working but I think what we have is an environment where it's far too common for talented and hardworking people to be stuck in the basement economically.
  
  I don't have a problem with people being rich and I would like to be some day.
• fish82

  

  Sage;816330 wrote:From 1980 to 2005, 80% of new income generated in this country went to the richest 1%.
  .......................................................
  
  Also, I love this idea that the uber rich are some how hard workers. Do you know any uber rich people? They don't work. Their money works for them.
  
  Did Les Wexner work super hard to build something like Easton? Or was he just fortunate enough to have enough money in his bank account to write a check.
  
  gg $$ to BoatShoes, who just destroyed whoever posted this inane thread.

  I lol'ed. Good stuff.
• FatHobbit

  

  I Wear Pants;816366 wrote:God damn it people. ... However, I think that the same isn't necessarily true about the poor. I have no problem with people being poor if they are not talented or hard working but I think what we have is an environment where it's far too common for talented and hardworking people to be stuck in the basement economically.

  
  Not only are all poor people not lazy, but lots of kids born to poor people don't have the family support they need to succeed in school. I had some built in advantages just because of who my parents were. I'm sure there were kids who had more advantages, but I've witnessed a lot of kids that had a lot less. I'm not saying that the answer is more taxes for the rich (not at all) but I wanted to agree that poor people aren't just poor because they are lazy. There's a lot more to it than that.
• QuakerOats

  sleeper;816334 wrote:So they just magically woke up one day and had billions of dollars? Where do I sign up?

  
  obama.com
• QuakerOats

  sleeper;816313 wrote:Capital gains taxes should be 0%. Income taxes should be eliminated entirely and replaced with a national 1% sales tax on all purchases. Spending should be cut drastically including reforming Medicare, Social Security, and defense.
  
  There, I just fixed America.

  
  You mean you just killed 30 million seniors so billionaires and millionares could get tax cuts.
  
  
  
• I Wear Pants

  QuakerOats;816432 wrote:You mean you just killed 30 million seniors so billionaires and millionares could get tax cuts.
  
  
  

  What he proposed is absolutely impossible and ridiculous.
• fish82

  

  I Wear Pants;816451 wrote:What he proposed is absolutely impossible and ridiculous.

  Other than the sales tax needing to be considerably higher than 1%, what's impossible/ridiculous about it?
• sleeper

  

  http://www.cato.org/pubs/pas/pa-272.html
  
  This is what I was referring too, and you're right its 15% NST not 1%.
• believer

  

  FatHobbit;816375 wrote:Not only are all poor people not lazy, but lots of kids born to poor people don't have the family support they need to succeed in school. I had some built in advantages just because of who my parents were. I'm sure there were kids who had more advantages, but I've witnessed a lot of kids that had a lot less. I'm not saying that the answer is more taxes for the rich (not at all) but I wanted to agree that poor people aren't just poor because they are lazy. There's a lot more to it than that.

  I see very few posts on here that specifically say, "poor people are lazy." However, I see plenty of posts that condemn the entitlement mentality that has developed in the welfare class as a result of redundant, costly, inefficient, and often corrupt gubmint-run social programs that encourage the poor and their posterity to permanently suckle off the "system."
  
  It's not the fault of the "lazy poor." It's the fault of decades of politically motivated New Deal and Great Society programs designed to create solid Democratic votes.
• tk421

  

  I'm not really sure what the left are complaining about regarding the ultra rich paying their "fair" share. If you look at the data for the Clinton years, which the left hold as the liberal mecca of tax receipts, you'll see that the yearly average percentage of tax paid by the top 1% is 31.51% with the highest year being 36.18%.
  
  If you look at 2000 onward, you'll see that the average yearly tax paid by the top 1% is 37.10% with the highest year being 40.41% in 2007. So, it looks like to me that the rich are paying even more of the total tax than during the Clinton years, so what's the problem?
  
  http://www.taxfoundation.org/news/show/250.html
  
  halfway down the page, Total Income Tax Shares 1980-2008.
• gut

  The Dems keep pushing the soak the rich strategy because they know it won't work, and ultimately the key to their re-election is an electorate dependent on the govt teet.
• tk421

  

  I guess I just don't understand why it's so hard for liberals to understand that the government spends too much money. You are talking about a 1.65 Trillion dollar deficit, and they are arguing about raising the tax on 1% of the country 4% points. What the hell do they think that's going to do, magically make 2 Trillion dollars appear in the fed coffers? Why is it so hard to understand that spending must be cut, dramatically? You aren't going to get close to an 80% increase in tax revenue, it's not going to happen. I have a better chance of holding a winning lottery ticket in my hands as I burn to death from a lightning strike than the federal government has of taxing enough money to pay for their spending.
  
  Have the liberals taken a look at the White House budget numbers? It's outrageous, by 2015 the projected budget is over 4 Trillion dollars, 4 TRILLION dollars. That's over twice the amount in receipts for 2011, how does that NOT seem like too much money? By 2019, we have over a 5 Trillion budget, with projected receipts over 4.4 Trillion. That's got to be the most optimistic budget numbers I have ever seen, how does the government project raising over 100% more in receipts in 8 years? Wow. These are Obama numbers, I'm not making this stuff up. I don't know how anyone looking at these can honestly think the government doesn't spend too much.
  
  http://www.whitehouse.gov/sites/default/files/omb/budget/fy2012/assets/tables.pdf
• BGFalcons82

  

  gut;816772 wrote:The Dems keep pushing the soak the rich strategy because they know it won't work, and ultimately the key to their re-election is an electorate dependent on the govt teet.

  
  Yep. But the key to their Senate re-election strategy will be to expound on the fabulous policy statements, spending cuts, and budgetary wizardry comprised in their 2009 budget. What's that?? Oh, my bad...their 2010 budget. That's the right one to promote and stand behind. Uhhh...wait a sec...nope...ummm...uhhh...I mean their FY 2011 federal budget.
  
  I'd post a link to Harry's budgets but the ball-less prick hasn't done one in over 785 days. And there are some on here that think he's the best
  thing since sliced bread. And you wonder why the Tea Party exists.
• sleeper

  

  Liberals don't care. When you don't want to work hard and you have nothing to live for, why not ruin it for everyone else? If the country collapses everyone will be on the same playing field and that's what they want.
• gut

  sleeper;816825 wrote:Liberals don't care. When you don't want to work hard and you have nothing to live for, why not ruin it for everyone else? If the country collapses everyone will be on the same playing field and that's what they want.

  Sadly, I think more than a few have that mindset. It's the whole "if I can't be rich, then he should be poor, too". There's no consideration for being worse off in such a scenario - misery loves company.
• stlouiedipalma

  BGFalcons82;816823 wrote:Yep. But the key to their Senate re-election strategy will be to expound on the fabulous policy statements, spending cuts, and budgetary wizardry comprised in their 2009 budget. What's that?? Oh, my bad...their 2010 budget. That's the right one to promote and stand behind. Uhhh...wait a sec...nope...ummm...uhhh...I mean their FY 2011 federal budget.
  
  I'd post a link to Harry's budgets but the ball-less prick hasn't done one in over 785 days. And there are some on here that think he's the best
  thing since sliced bread. And you wonder why the Tea Party exists.

  
  I certainly don't wonder why the Tea Party exists.
• gut

  BGFalcons82;816823 wrote: I'd post a link to Harry's budgets but the ball-less prick hasn't done one in over 785 days. And there are some on here that think he's the best
  thing since sliced bread. And you wonder why the Tea Party exists.

  
  Remember that post about states cutting budgets having the highest unemployment (as if correlation equals causation, or as if deficits didn't necessitate cuts since states can't, you know, just print money)....Well, check out the state of the states of the Dem ring leaders Pelosi and Reid.
• derek bomar

  

  tk421;816571 wrote:I'm not really sure what the left are complaining about regarding the ultra rich paying their "fair" share. If you look at the data for the Clinton years, which the left hold as the liberal mecca of tax receipts, you'll see that the yearly average percentage of tax paid by the top 1% is 31.51% with the highest year being 36.18%.
  
  If you look at 2000 onward, you'll see that the average yearly tax paid by the top 1% is 37.10% with the highest year being 40.41% in 2007. So, it looks like to me that the rich are paying even more of the total tax than during the Clinton years, so what's the problem?
  
  http://www.taxfoundation.org/news/show/250.html
  
  halfway down the page, Total Income Tax Shares 1980-2008.

  
  you're conveniently leaving out why they're paying more as a total % of revenues...because the income of the top has gone up relative to everyone else...
• BGFalcons82

  

  A short video about world economic freedom - http://www.youtube.com/watch?v=v1U1Jzdghjk&feature=youtu.be
  
  Those that continue to believe in trading liberty for security, job freedom for government oversight, and believe corruption reigns in capitalistic societies, please feel free to comment.
• fish82

  

  derek bomar;817267 wrote:you're conveniently leaving out why they're paying more as a total % of revenues...because the income of the top has gone up relative to everyone else...

  That's irrelevant. In fact, it actually demonstrates that the "progressive" tax code is working as intended.