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The debate about whether or not raising taxes on the rich would increase government revenue, is...

The debate about whether or not raising taxes on the rich would increase government revenue, is "beside the point," writes John Carney on CNBC. The real reason to hike taxes is to fight inflation, but if and when it exists, the measure possibly wouldn't cure that problem either. "The proposals to raise taxes on the wealthy just don’t add up," Carney writes.
Comments (80)
  • Amadon
    , contributor
    Comments (163) | Send Message
     
    It might have some value in the perception of fairness however.
    26 Aug 2012, 06:58 AM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    On the perception, yes. On the reality, it depends.

     

    Let me ask something. You have this small community. This community needs to dig a well for the common good. How are you going to divide the task of digging the well fairly? Do you:
    1) Make each citizen to dig the same length;
    2) Make each citizen to dig for the same time (thus the length each will dig will depend on each citizen's prowess digging);
    3) Make those that dig faster dig more time than the others.

     

    Sometimes when we think of solutions for our society, we're thinking in a plane in which we cannot really understand the ethical characteristics of what we defend. Only by bringing problems to a more human, personal, scale, can we better understand the ethical dilemmas at hand.
    26 Aug 2012, 07:43 AM Reply Like
  • frosty
    , contributor
    Comments (694) | Send Message
     
    In another idyllic community they believe, 'from each according to his ability, to each according to his need.' That didn't work either. Taxation should not be inverted to favor the wealthy as it is now. Remember, the biggest tax that people near the bottom of the wage scale pay is FICA so their total tax is FIT + 6.35%. Many wealthy don't pay FICA becaue they don't earn wages. Steve Jobs pay was $1 per year, Romney probably doesn't earn wages. Fica taxes should be extended to all forms of income, and a flat income tax without deductions should be established. This would end the favoritism that people wealthy enough to hire good accountants and lawyers receive.
    26 Aug 2012, 09:09 AM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    But how would you choose the taxation in the example I gave you?

     

    "from each according to his ability, to each according to his need", btw, is what we have today and is choice number 3 above. Those who have the ability are made to work more for the others.

     

    Is taxation really inverted in the favor of the wealthy even if they pay a lower % in taxes? That's also debatable. Even a lower % can mean a much higher contribution, if applied on a much larger amount.
    26 Aug 2012, 09:25 AM Reply Like
  • frosty
    , contributor
    Comments (694) | Send Message
     
    I never thought of it that way. We should then also lower the sales tax % for the wealthy since they buy so much more than others and therefore pay a larger total sales tax. We should also lower their property tax % since they pay so much more on their big houses. Also state income %'s could be reduced for the wealthy.

     

    If everyone paid the same amount, there would be no taxes at all and we would be living in a place like central New Guinea. If you don't accept the flat % tax, the alternative is indexation and then the decision is how much indexation.

     

    People can debate the 'fairness' of every tax that exists depending on their special interests - own a home, have a mortgage, use your car for work, earn dividends, capital gains, oil depletion allowance, install energy efficent appliances, lease a 'truck' (i.e., SUV) for your 'small business' (i.e., doctor, lawyer, dentist, accountant, entrepreneur, . . . and no, the wife doesn't use it to take the kids to soccer). So, of course, what we have is an unintelligible tax code that neither accountants nor the IRS can figure out correctly.

     

    Actually, Cain was onto something with his 9-9-9 idea, although the numbers need some work. There are 3 things that can be taxed - what you earn, what you own, and what you buy. A fair taxation system should consider a balance of the three - at the federal, state and local levels.
    26 Aug 2012, 10:22 AM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    Still, how would you solve the well problem?
    26 Aug 2012, 10:25 AM Reply Like
  • DavyJ
    , contributor
    Comments (416) | Send Message
     
    Make each citizen dig according to the amount of water used.
    26 Aug 2012, 12:19 PM Reply Like
  • Amadon
    , contributor
    Comments (163) | Send Message
     
    Any solutions for those who hide their strength and resources in hidden off shore accounts or for those who have becomes so weak from unemployment, underemployment, ageing or physical impairments that they can no longer contribute?
    26 Aug 2012, 12:34 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3529) | Send Message
     
    Frosty,

     

    You are confusing income with wealth. To really tax the rich, you have to have some type of ad valorem (net worth) tax. An example is your real estate tax where you pay based on the value of your property. If you want a big house, you pay more to support the community services. Right now, we have a back door (and poorly targeted) net worth tax with our planned inflation targets. But if you think you'll get support for a net worth tax from our millionaire senators, dream on.
    26 Aug 2012, 01:29 PM Reply Like
  • The Independent Investor
    , contributor
    Comments (1439) | Send Message
     
    Well, its not true to say the wealthy are working for other because they pay more taxes. Most doctors and lawyers who are wealthy don't work harder than coal miners and janitors - that's nonsense. Also, wealth can make significant returns investing - those with limited income have limited ways to increase earnings investment.
    26 Aug 2012, 02:21 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    It's not about working harder, it's about the value of what you produce, as paid by others voluntarily.

     

    And taxes are also value, which is convertible in work by others. So yes, if someone pays 2 doctors and another person pays 1/10 of a doctor in taxes, the first one has given 20x more back to that society ("for free") than the second person, no matter what the tax rate is - and that's in excess of the (paid) value the person already gives to society for performing his duties.
    26 Aug 2012, 02:37 PM Reply Like
  • The Independent Investor
    , contributor
    Comments (1439) | Send Message
     
    Your confusing principle with economic value - which suggests to me the problem with your overall analysis. Economic value is based on supply and demand - not value to soceity - mark Zuckerberg has over $2-3 billion, is he 2-3 billion times more valuable than a doctor or lawyer - nonsense. Economic value and the value one provides to soceity are almost never the same - why capitalism can brutal. The problem with your commentary is that most people don't think the true value - not just economic - that doctors and lawyers and hedge fund managers provide - is worth 20x janitors and coal miners.

     

    Your argument also assumes a fair and free market. The value that laborers provide to companies is obviously skewed since to companies, workers getting $20-30 an hour are overpaid since they can hire labor in China for $1 a day. But Chinese labor is chep because the government suppresses union and doesn't have a minimum wage - its not a free market. Likewise, doctors are only paid what they are paid because of government subsidies - if people paid cash pocket they wouldn't have 500 bills cough pills.
    26 Aug 2012, 02:44 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    Nope, there's no such thing as "value for society". The only value that exists is what some other person is willing to forgo to get or keep something. It might not even be monetary, though obviously monetary value is the most common.

     

    A Van Gogh painting has value because someone else is willing to give millions for it. It's worth the work of many doctors, simply because you can trade it for the work of many doctors.

     

    Zuckerberg produces value for society simply because a few hundred million person each see a bit of value in what he created. All put together, that value is immense and made him rich.

     

    Your own opinion that he's not a billion times more valuable than someone else is simply your subjective opinion on value - the objective fact is that he can command the work of thousands of others, because hundreds of millions of others voluntarily made him able to.
    26 Aug 2012, 02:54 PM Reply Like
  • Amadon
    , contributor
    Comments (163) | Send Message
     
    I totally agree Paulo; Natural law passes no moral judgement on how a person acquires his wealth. Winning is all that matters in the struggle for survival. In pre-Darwinian times, monotheistic social systems, attempted, unsuccessfully, to limit wars and revolution by creating economic systems to distribute wealth equitably. Those systems have been relegated to the dust bins of history.

     

    We are now the most polytheistic society in the history of the world and have real life gods of all manner actually living among us who we can observe and be entertained by and emulate. We can dress them up in all manner of costumes and put them on display like potted plants in great pomp and ceremony. Some entertain us in more lively exhibitions like playing billiards in the nude with their admirers. The central message from all of our modern gods, from politicians to movie stars is that "greed is good".

     

    Natural law passes no moral law on class warfare, revolution or any other means employed by any group to ensure their survival. Is it any wonder that the history of the world is such sad reading and that it continues to repeat as soon as the lessons of the past are forgotten.

     

    26 Aug 2012, 03:56 PM Reply Like
  • The Independent Investor
    , contributor
    Comments (1439) | Send Message
     
    No, its not subjective to say Mark Zuckerberg doesn't have 2 billion times the value as a person as most coal miners, janitors, and other laborers. Economic value and values are different - but certain values are objective in 99.9% of soceities. Also, you continue to assume that the market is a free market, its not. Rich people have advantages the poor and middle class do not, corporations have advantages individuals and laborers do not. Simply because a company that can outsource labor to China where the government keeps labor artificially cheap makes money more money than workers in the U.S. does not make them more valuable. You are grossly overestimating the extent to which a true free market exists - doctor pay in part exsits because of noneconomic values leading public subsidies.
    26 Aug 2012, 04:54 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    It is not he that is more valuable. It's what he created. It's objectively more valuable, because people give him that value voluntarily, even if each only gives him a little (in practice, it's not people that give him the value, but their presence that's valuable for other economic actors).

     

    It's natural that a person, laboring, has it incredibly hard to become wealthy - after all the production that he can generate for others is usually very limited. Only by transcending what a person can produce, through the use of capital means, aggregating a slight margin over the production of others, can you accumulate enough income (not wealth - that will depend on how much of that income you consume).

     

    Doctor pay also exists because of artificial barriers to entry, licences, etc. Obviously all those decisions about value are conditoned by the rules of the society you live in, how they affect supply and demand, etc. Also, it's comparatively much easier to get large monetary value for the same services out of a group of people that, themselves, have already achieved a great amount of wealth. Anyway, its complex.
    26 Aug 2012, 05:15 PM Reply Like
  • Whitehawk
    , contributor
    Comments (3129) | Send Message
     
    @DavyJ: Excellent response - except this solution is rarely applied. Those who use more of the water often want everyone to contribute "equally," which means subsides and transfers are effectively given to those using more. (There is also the situation where those using more water want to contribute less, and to arrange for others to contribute more.)

     

    This imbalance does have ethical and moral issues, and applies to just about every "entitlement" or "socialized service."
    26 Aug 2012, 05:19 PM Reply Like
  • The Independent Investor
    , contributor
    Comments (1439) | Send Message
     
    Well, economic and social value are distrinct, and all soceities have fairly objective social values. If an individual makes more than 1000x what half soceity makes, income tax can bridge the gap between economic wealth and social inequality.
    26 Aug 2012, 05:40 PM Reply Like
  • orangutan
    , contributor
    Comments (220) | Send Message
     
    Everyone who wants water should dig. Unfortunately, there will be some people who cannot dig: children, the elderly, the infirm. There will be some people that help in other ways: making the shovels, bringing lunch, testing the water to make sure it is not contaminated, figuring the best way to get it to where it is needed. Those most eager to get the water, whether their contribution is digging or not, will probably get a good share. Some people will get less water, some will get no water at all. Some people will convince others to do their digging for them. They will promise them a bigger share of the water, a cruise to the Bahamas, whiter teeth. These promises may or may not be kept. In a "free" society, with no constraints or regulations, one person will eventually find a way, "ethical" or not, to control all the water. And I can just about guaranfuckintee you that it won't be the person who dug the hardest.
    26 Aug 2012, 06:58 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    orangutan, the premise here is that it's a communal project, so one is just setting the rules on how to divide the effort.
    26 Aug 2012, 07:26 PM Reply Like
  • orangutan
    , contributor
    Comments (220) | Send Message
     
    Forgive me, I thought it was meant to be an analogy for society at large. I'm not sure what you mean by "communal project". If the purpose of a communal project is to be "fair", then you choose option #1. If the purpose is to get the job done, then you choose option #3. I have been involved in communal projects where option #3 is chosen. If my wife and I are driving and get a flat tire, I do all the work changing the tire because I can do it faster. Then, in the least amount of time, we are both on our way again. When brain surgery needs to be done, we certainly don't want to parcel that work out evenly to everybody, do we?
    26 Aug 2012, 08:22 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    Think in abstract terms, obviously in any society specialization will then lead to those most productive at a given task to be assigned to it, and the efforts will be fungibilized by the use of currency.

     

    But we're thinking about allocating people's efforts to a given task without compensation, just to complete the task for that community.
    26 Aug 2012, 08:28 PM Reply Like
  • orangutan
    , contributor
    Comments (220) | Send Message
     
    Then #3, definitely.
    26 Aug 2012, 09:36 PM Reply Like
  • Paulo Santos
    , contributor
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    Ok, then 3 is the same as progressive taxation. Those that make more need to pay proportionally more.

     

    2 is the same as a flat tax (same % for everybody).

     

    But I find it hard that you really would defend 3, and see it as fair. Remember, these people are supposed to have their lives and be independent from each other, they get together only for this task by taking time away from their lives. How can you really force some to work proportionally much more than others in the same task and see it as fair?
    26 Aug 2012, 09:42 PM Reply Like
  • coddy0
    , contributor
    Comments (1182) | Send Message
     
    "In another idyllic community they believe, 'from each according to his ability, to each according to his need.' That didn't work either. Taxation should not be inverted to favor the wealthy as it is now."
    ======================...
    This other idyllic (failed) community is former CCCP
    Your example does not support your point and actually it contradicts your point
    26 Aug 2012, 10:27 PM Reply Like
  • coddy0
    , contributor
    Comments (1182) | Send Message
     
    frosty
    Many wealthy don't pay FICA because they don't earn wages.
    ======================...
    FICA is contribution to one's retirement
    Half pays employer and half pays employee
    People like Romney are paying full price
    26 Aug 2012, 10:37 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    Btw, how much are those FICA rates, employee+employer?

     

    The equivalent here in Portugal comes to 34.75% (11% exployee, 23.75% employer).
    26 Aug 2012, 10:47 PM Reply Like
  • coddy0
    , contributor
    Comments (1182) | Send Message
     
    @Paulo
    For 2008, the employee's share of the Social Security portion of the tax is 6.2%
    up to a limit of $106,800
    employer pays 6.2%
    so it 50 50
    26 Aug 2012, 11:01 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    Geez, that's quite low (compared to here).
    27 Aug 2012, 07:58 AM Reply Like
  • marilyn61
    , contributor
    Comments (173) | Send Message
     
    The wealthy need to pay taxes the same as the rest of us. The more they earn - the more they pay. That is fair. However, overtax them and they leave and go somewhere where they can pay less tax therefore to the detriment of the original country. We all accept that taxes are a necessary evil so long as they are wisely spent - but don't chase away the wealthy.
    26 Aug 2012, 07:56 AM Reply Like
  • William Edward
    , contributor
    Comments (67) | Send Message
     
    Increasing taxes on the rich plays to a very human emotion-envy. People use envy to gain leverage over a group to use that group for their own purposes. The people who do that pose a threat to society as a whole. Watch them carefully, they are dangerous.
    26 Aug 2012, 08:05 AM Reply Like
  • Terry330
    , contributor
    Comments (867) | Send Message
     
    Rich have gotten a free pass for decades, and US has debt to prove this. Even the Bible speaks out many times on wealthy paying high taxes, calling it greed-a christian sin.
    26 Aug 2012, 09:08 AM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    That wasn't so clear.
    26 Aug 2012, 09:26 AM Reply Like
  • coddy0
    , contributor
    Comments (1182) | Send Message
     
    @Paulo
    Speaking of bible
    Terry has customized for her
    26 Aug 2012, 11:08 PM Reply Like
  • css1971
    , contributor
    Comments (870) | Send Message
     
    LOL. Taxes?

     

    Totally irrelevant. The US is waaaay, waaaay past taxes.

     

    http://bit.ly/PkGh75

     

    The US is well on the way towards banana republic status.
    26 Aug 2012, 08:26 AM Reply Like
  • Clayton Rulli
    , contributor
    Comments (2559) | Send Message
     
    Heres the solution. Get rid of the loop holes in corporate tax structure. Take this extra revenue and reward those who hire US employees. This circle will net a result of additional revenue due to more wokrs existing therefore more taxes on ages being collected.

     

    If you have no "earned income", yet are still making millions per yer on investments ( "unearned income" ), this needs to be taxed at a higher rate. Perhaps rewarding those who have this unearned income from investments originating from US based businesses or the like could be taxed at a lower rate, ( similar to municipal bond tax break )
    26 Aug 2012, 09:53 AM Reply Like
  • bosco115
    , contributor
    Comments (196) | Send Message
     
    You mean reward those employers by... creating a loophole in the tax structure so they pay a lower rate?

     

    And now you know why we got in this mess in the first place.
    26 Aug 2012, 10:06 AM Reply Like
  • IgnisFatuus
    , contributor
    Comments (2115) | Send Message
     
    One man's deduction is another man's loophole...
    Flat tax on all means of income be it wages, interest, dividends or capital gains above a baseline amount...just where to set that baseline is a question.
    26 Aug 2012, 12:29 PM Reply Like
  • anonymous#12
    , contributor
    Comments (552) | Send Message
     
    The reality is that the current system is unsustainable. We are seeing the effects of the huge income inequality in the US. We have high unemployment, record poverty levels, zero wage growth and at the same time all time highs in corporate profits and strong income gains at the top 1%....

     

    We can't have the top 1% holding the majority of the wealth, while the middle class scraps by. No matter how hard they work they can't move up.

     

    In 1960, the CEO to worker compensation ratio was 20 to 1, now it is up to 231 to 1. This occurred while productivity growth from workers was very strong....the productivity gains went to the CEO.
    26 Aug 2012, 10:00 AM Reply Like
  • phxcrane
    , contributor
    Comments (416) | Send Message
     
    Possible because the majority of productivity growth wasn't from manual labor.
    26 Aug 2012, 10:08 AM Reply Like
  • Ron Myers
    , contributor
    Comments (256) | Send Message
     
    CEO's are 11.5 times better leaders now and deserve the extra money for being risk takers with other people's capital.
    26 Aug 2012, 10:27 AM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    Ron, the thing is, we either want freedom or not. If you want freedom for people to pay what they want for whatever they want, the result can be a significant accumulation of wealth on some people.

     

    The corporate governance system might need reworking, though, as it's not likely that shareholders really want to pay as much as they've been paying. The decision is just not flowing through them.
    26 Aug 2012, 10:32 AM Reply Like
  • css1971
    , contributor
    Comments (870) | Send Message
     
    A lot of people don't understand what productivity increases are. They are the replacement of human labour with machine labour. Calories replaced by kiloWatts[1].

     

    [1] Yes... I know calories are a pre SI unit of energy and kiloWatts are the SI unit of work.
    26 Aug 2012, 11:14 AM Reply Like
  • davidshelton
    , contributor
    Comments (312) | Send Message
     
    I refuse to believe that freedom has anything to do with senior execs getting such a disproportionate piece of the capitalist pie. This smacks of an elite able to take more from the many in a skewed system that has nothing to do with a true free market. I would substitute the word freedom for corporatocracy. The continual erosion of freedom of the many(eg the 99%) because of (amongst many other reasons)their misguided voting, apathy and the continual maneuvering and scheming of the moneyed interests(eg cabal of execs, banksters etc) to regulate the free market to death to there advantage, to rig the "game" even further. This has had the net effect of only reinforcing this corporatocracy. One can only hope that this vicious cycle is broken in my lifetime and a system reset restores some greater measure of freedom to the world.....
    26 Aug 2012, 05:06 PM Reply Like
  • Amadon
    , contributor
    Comments (163) | Send Message
     
    david;
    Have no fear that the vicious cycle will continue unbroken. Natural Law always acts to restore balance to any system which spirals out of control with the certainty of gravity or any of the physical laws.

     

    As to whether it will occur in your lifetime depends on where you live as the reset is occurring now in many areas of the world. You probably will not enjoy it much when it reaches your neighbourhood as Natural Law does not discriminate between good and evil, rich or poor, young or old.

     

    When population increases cross the threshold of declining resources (primarily energy, food and water) then the extinction event begins at that location. There have been 5 major extinction events in the past and we are well into number 6. Every biological organism alive today is a relic of these past extinctions which eliminated 99% of past organisms.

     

    The strongest and wealthiest believe they may be able to improve their odds by buying private islands, building defensible mansions on mountain tops, etc. and they are probably right as Natural Law bears them no grudge due to their wealth.

     

    We are currently in what is believed to be a population "overshoot" brought about by the discovery of oceans of fossil fuels 200 years ago. When the cost of recovering the energy exceeds the value it returns then the population must decline and it usually produces an extinction event "overshoot" on the way down due to panic, resource wars, famine and disease.

     

    As the old "tent-maker" wrote in his famous poem:

     

    The moving finger writes,
    and having writ, moves on
    Nor all our piety or wit
    Can lure it back
    To cancel even half a line of it.

     

    Have a nice day sir.
    26 Aug 2012, 06:21 PM Reply Like
  • anonymous#12
    , contributor
    Comments (552) | Send Message
     
    That's why I don't get the exorbitant pay of the top executives of a company, banks included....

     

    On the good times they get all the benefits, they make millions. When the company goes kaput, they are rewarded with a termination package that consists of millions of dollars.

     

    The CEO doesn't risk their capital. Shareholders get screwed.
    26 Aug 2012, 10:40 AM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    The markets have a big problem working when those who decide how much gets paid are not the same ones paying.

     

    The shareholders pay but don't decide how much.
    26 Aug 2012, 10:45 AM Reply Like
  • anonymous#12
    , contributor
    Comments (552) | Send Message
     
    Paulo, I agree. Shareholders should have more power on pay.
    26 Aug 2012, 11:00 AM Reply Like
  • dspell
    , contributor
    Comments (2) | Send Message
     
    How long can a economic system exist, when the gap between the 1% and 99% keeps increasing. History says there is a tipping point, and that point is not peaceful
    26 Aug 2012, 10:45 AM Reply Like
  • Poor Texan
    , contributor
    Comments (3529) | Send Message
     
    How are you measuring the 1%, Income or wealth? Buffet does not have a high income so how do you measure what his share of the nation's expenses should be.
    26 Aug 2012, 07:25 PM Reply Like
  • Joe Morgan
    , contributor
    Comments (1500) | Send Message
     
    Most of the American workers are lazy, they want a huge salary without working for it.

     

    The BS of fair share is just that, BS!

     

    The Free market decides what pay CEOs should get, not a corrupt government which incites class warfare to gain votes.
    26 Aug 2012, 10:49 AM Reply Like
  • lbarbato
    , contributor
    Comments (2) | Send Message
     
    Taxes are near their lowest rates in decades. Restoring rates to those that prevailed during the Clinton years (and yes, the economy was doing well then) isn't crazy - its just restoring taxes to a level that will reduce the deficit without being unduly onerous.
    26 Aug 2012, 10:51 AM Reply Like
  • css1971
    , contributor
    Comments (870) | Send Message
     
    We've just spent the last 40 years deliberately replacing taxes with deficit spending... Wonder why that might have happened...
    26 Aug 2012, 11:16 AM Reply Like
  • tradewin
    , contributor
    Comments (658) | Send Message
     
    William Edward is absolutely correct. It is entirely emotional. It's a lot easier to play on peoples emotions than it is to appeal to their reflective side. That's work. Thinking. The fact is, when taxes are raised, revenues fall. People change their behavior. That Laffer Curve sneaks up to remind everyone of the folly of this, usually after the fact. Example: Remember the luxury tax Bill Clinton slapped on all of those high-end yachts? People are rich enough to buy these things, then they can pay that extra luxury tax on them. That put a lot of boat builders here out of business, including their employees, because all of those rich people just went oveseas to buy their boats. Clinton lifted the tax, but only after the damage was done.
    26 Aug 2012, 11:18 AM Reply Like
  • Amadon
    , contributor
    Comments (163) | Send Message
     
    I think I read somewhere that 50% of the US is so poor that they pay no taxes at all. Maybe its time for the 1% to consider concentrating them into re-education and rehabilitation centres in large metropolitan areas where they could be introduced to some of the realities of how trickle down economics works. It is after all their government, bought and paid for, so let FEMA work at the details on how to feed and clothe them while they learn how work can make them free.
    26 Aug 2012, 12:05 PM Reply Like
  • mr clark
    , contributor
    Comments (626) | Send Message
     
    either raise taxes or cut govt fraud, either will pay positive dividends in the long run... the anti tax fanatics should focus on cutting govt fraud, though many wealthy make their fortunes off the govt largesse, health, military, tech, oil/gas, outsourced manufacturing, many of todays m(b)illionaires are so because of govt policies and spending

     

    cut the fraud, double billing, mafia type schemes, graft etc and save an absolute fortune
    forensic accounting is needed, especially with citizen oversight FBI is a joke
    26 Aug 2012, 01:00 PM Reply Like
  • Amadon
    , contributor
    Comments (163) | Send Message
     
    When I read these articles and comments I am always struck by the analogy to a climax forest where all the participants struggle for a place in the sun which provides the energy to sustain all life.

     

    In time the most successful species will come to dominate the canopy of the forest and capture 99% of the energy and be able to put down deep roots to mine the minerals of the earth so necessary to maintain their immense size. The other species who are left in the shade must make do with the remaining 1% of the sun energy.

     

    The most successful species that it usually found dominating a climax forest is actually a parasite species who begins life as a seed in bird droppings who habitually roost in the top of the tallest trees.

     

    The little parasite seed begins life as a vine and after first putting down a tap root near the tallest and most successful trees it begins to grow as a vine and rapidly wraps itself around the tree in the manner of a snake. In time it completely encapsulates the body of its victim and becomes the new owner of the space with access to the roof of the canopy and incorporates the victims body and root systems into its own. It is known as a Strangler Tree or Strangler Fig.

     

    Look at he top of almost any eco-system and you are likely to find a parasite species who are strangling the life out of those around them. It seems to be a very successful strategy.
    26 Aug 2012, 01:47 PM Reply Like
  • Amadon
    , contributor
    Comments (163) | Send Message
     
    If you have never seen a climax forest you may be too close to see the forest for all the trees. I have never seen the view from the top of the canopy either but a little bird told me the view from Jackson Hole, Wyoming is just magnificent.
    26 Aug 2012, 02:18 PM Reply Like
  • tradewin
    , contributor
    Comments (658) | Send Message
     
    With all of its limitations, it would be no surprise if someone brought up the Gini Index during this election year. Based on the Lorenz Curve, it is mathematically proportional to the dimensions of the outhouse on the top vs. the outhouse directly underneath it.
    26 Aug 2012, 02:13 PM Reply Like
  • wall23
    , contributor
    Comments (5) | Send Message
     
    Need to raise taxes, how about on the high frequency trades,that should fix things. just an idea...
    26 Aug 2012, 04:04 PM Reply Like
  • Amadon
    , contributor
    Comments (163) | Send Message
     
    Sure, why not. It won't affect me as I do not have access to such systems and by the time they reach me through the trickle down effect they will be obsolete and new scams will have been developed. I'm not complaining though. I'm happy enough here on the floor of the climax forest, enjoying the cool shade and the company of the other wildlife. If I had fame or wealth I would probably wake up naked and drunk laying along side my wrecked automobile.
    26 Aug 2012, 04:21 PM Reply Like
  • JoePernice
    , contributor
    Comments (14) | Send Message
     
    Paul, what about this for a start:
    1) No limit on social security tax (social security solved)
    2) Give corporations a deduction for dividends. (No more double taxation and get money to the shareholders that could start small businesses with it.
    26 Aug 2012, 05:03 PM Reply Like
  • Hendershott
    , contributor
    Comments (1542) | Send Message
     
    Income taxes are an unreliable way to fund the government, which is why most countries go to a VAT. But if income taxes is how we are going to fund our government then we have to tax the people who have the income, i.e.. the wealthy. It doesn't do much good to try to tax people with no money. 50 years of no wage increases after inflation. The traditional source of tax revenues was the middle class, and incomes tracked the bell curve quite nicely. What's left of the middle class is almost statistically insignificant, the bell curve has become a parabola. If income taxes are the government's source of revenue then you have to tax the wealthy, the parabolic incomes.
    26 Aug 2012, 08:18 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    Truth be said, even people without income could be taxed - by providing hours of work. After all, that's what people with incomes that are taxed, do.
    26 Aug 2012, 09:01 PM Reply Like
  • mike8599
    , contributor
    Comments (587) | Send Message
     
    That will work out well.... sounds like communism.
    26 Aug 2012, 09:06 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    Why? There's no real reason for someone that works to have to give part of his hours to the State, and someone that doesn't, to have to contribute nothing when he can give time as well. It's as hard for the worker to do it, as is for the non-worker.

     

    And this has the great advantage of making everyone aware of the costs the State entails. You no longer have people that are so obviously "net beneficiaries".
    26 Aug 2012, 09:12 PM Reply Like
  • Amadon
    , contributor
    Comments (163) | Send Message
     
    My understanding is that a substantial majority of the ~16% of the unemployed, under-employed, and the ones who have dropped off the radar and are sleeping in cardboard boxes would love to have a job so they could pay taxes. If there is work for them to do then why not just hire them, A 60 year old person who has lost her job when the newspaper went bankrupt due to disruptive new technology is in a tough position. To young to collect SSN, too old to retrain or compete with younger more tech savvy and cheaper rivals. Do I understand that your plan is to now put her into involuntary servitude to pay her tax bill? Was It Communism or Fascism that ran a test pogrom of this a few years ago? Or was it both?
    26 Aug 2012, 10:00 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    Amadon, society also has unemployment benefits.

     

    And "involuntary servitude" aplies as easily to someone giving 4 hours per day of work, as it applies to someone giving the earnings of 4 hours per day in taxes, it just doesn't SEEM the same. But it is. Paying taxes is never fun.
    26 Aug 2012, 10:05 PM Reply Like
  • mike8599
    , contributor
    Comments (587) | Send Message
     
    Paulo - I'm not against your idea... but it sounds like the beginning of "the perfect state". You are stating an ideal that people would work without pay for the good of the state.

     

    All I'm saying is that I doubt you find many volunteers for this, and if you try to force people you will end up with a socialist state, managing people via the government.
    26 Aug 2012, 10:09 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    Well, it's not an ideal - it's what we have, when we pay taxes. It's not about being voluntary either - taxes aren't voluntary. It's about bringing a cost to everybody, so that the thing doesn't turn into two wolves and a sheep deciding on dinner.
    26 Aug 2012, 10:18 PM Reply Like
  • mike8599
    , contributor
    Comments (587) | Send Message
     
    No it's not what we have.... people do not work directly for the state. People get paid money for their contributions to society via companies and corporations.

     

    In turn they pay the government for services.

     

    To be fair you charge the same percentage like we do with SS and Medicare, and you hit the consumers with an additional tax.
    26 Aug 2012, 10:22 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    Paying to the gov in taxes, or working for the gov is about the same thing (it's just not exactly the same thing because work is not really fungible while currency paid in taxes is).

     

    For all purposes, a part of your time you're working for the gov, only you do so by working at your regular job and handing over your pay to the gov.
    26 Aug 2012, 10:27 PM Reply Like
  • Amadon
    , contributor
    Comments (163) | Send Message
     
    Thanks for clearing that up, I thought there were some kind of time limits on unemployment benefits. I don't know that much about them as I still have my first one to draw and I am 75. Lucky me. you are also right about "Paying taxes is never fun", but I do take a little pride in the fact that I have always paid a higher % of my income than Mitt has in the last couple of years even though according to my back of the envelope calculations Mitt makes roughly 10,000 times more than I do. You may suspect that I have my underwear all bunched up in a knot due to class envy but I assure you that I do not. Money is not the goal of everyone. I feel like I have a "Goldie Locks" life...enough to be comfortable, no more-no less. Happy to pay my fair share even though I receive very little services by way of city water, sewage, trash pick-up, child education, emergency services, etc. I truly can't think of a single person now or in the past I would trade places with. I do appreciate your comments and understand where you are coming from.
    26 Aug 2012, 10:31 PM Reply Like
  • mike8599
    , contributor
    Comments (587) | Send Message
     
    Paulo of course you pay the government - what I said. But you do not work for the government - which is contrary to what you said.

     

    You also pay the bank, grocer, and utility supplier for their services.

     

    I know what you are trying to say but you can not work for government in lieu of paying taxes, or if you can not afford to pay them, or if you don't have a job. That concept leads to the same place....government control via no choice.
    26 Aug 2012, 10:41 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    But while paying a lower %, Romney still paid a huge amount in excess of what you paid. Which means he financed a huge amount of govenment services in excess of what you did.

     

    It doesn't make a whole lot of sense to fault someone who financed 10 doctors because we think he should have financed 15, when we ourselves have financed 0.5.

     

    Those receiving the services of those doctors have more to thank the guy that didn't pay his share but paid more in absolute terms, than the guy who paid his share but contributed less..
    26 Aug 2012, 10:54 PM Reply Like
  • smarton
    , contributor
    Comments (51) | Send Message
     
    Perhaps you can't fault him for that.

     

    You can fault him for evading the law with offshore accounts and creative accounting. In a free society we all need to play by the same rules.

     

    You can fault him for accumulating his wealth by damaging people's lives. "Restructuring" companies, laying off workers, hurting pretty much all stakeholders except himself and a few around him. That kind of activity is not unabiguoulsly positive for society, although one would need to argue many details case by case.

     

    The premise of progressive taxation is that the wealthy will (almost by definition) take advantage of the less wealthy, but if they contribute back some of what they took, society can hopefully sustain itself. I argue vaguely that the wealthy class shouldn't extract a larger share than what the economy grew by in a given period, to at least maintain equilibrium. This does not seem to have been the case in the past few decades in the US and many parts of the world, which precipitated a possibly insupportable decline in the incomes of the majority of the population.

     

    Nature has few phenomena that can continue forever out of equilibrium. Wealth equilibria have reset themselves many times over history, but the resets usually weren't pleasant. Feudalism is the perrenial configuration of human societies, but the idea is that its extreme swings can be moderated with intelligent planning (ie: progressive taxation). If we give up this goal, we resign ourselves to the violent, painful swings of nature. Some of us prefer to think we are better than that, as a race.
    27 Aug 2012, 05:32 AM Reply Like
  • Paulo Santos
    , contributor
    Comments (18852) | Send Message
     
    You can fault him if you find rules that he didn't follow. But not for his contribution to financing the government, since it exceeds most others in absolute terms.

     

    It makes no sense to fault someone for saving 10 lives when he could conceivably have saved 15, when everybody else is saving 0.1 or 0.5 lives.
    27 Aug 2012, 08:01 AM Reply Like
  • mike8599
    , contributor
    Comments (587) | Send Message
     
    Oh for pete's sake - KISS - flat tax on all income plus consumption tax.

     

    Everyone has skin in the game and the people that consume more pay more. done.

     

    Paulo - the point is everyone digs.
    26 Aug 2012, 08:51 PM Reply Like
  • tradewin
    , contributor
    Comments (658) | Send Message
     
    We live in a civilized society. There will always be people who don't want to dig and they simply cannot be told that they will not be allowed to drink from the well. Even when the economy is steaming along at a healthy pace, unemployment never dips below four percent. The indirect effect of our own selfish interest is that invisible hand that Adam Smith spoke about two hundred years ago. And there will always be those that are Ayn Rand crazy. Anyone have a Carnegie Library in their town?
    26 Aug 2012, 10:23 PM Reply Like
  • b0a4pkd
    , contributor
    Comments (28) | Send Message
     
    Good morning fellow Americans! Great discussion. I think the problem with our country is we have actually become too open. Although I am not that old when I was a kid it seemed immigrants had a burning desire to be American and become Americanized. I don't really see the 2nd part anymore. People now seem to have apathy about being American. Even many immigrants. It seems it has turned into more of a buisness transaction. Possibly, this change in attitude has begun a me first attitide where "country" is no longer in the pecking order. The same could be said of Christianity. Imagine 20 yrs ago having school call Christmas "The Holidays" instead of Christmas. My mom told me when I hit my teens if you let the world use your girl and don't care, no matter how much she loves you she will begin to disrepect you. Once that happens its over. Taxes and well as country have all been marginalized in lieu of "what I want". Gold bless the USA. We will be back someday...Thx
    27 Aug 2012, 03:02 AM Reply Like
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