The Tulsa Forum by TulsaNow

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100 and If they paid their bill the way we pay our taxes, it would go something like this:

The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.)

So, that's what they decided to do.

The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve. "Since you are all such good customers," he said, "I'm going to reduce the cost of your daily beer by $20." so drinks for the ten now cost just $80.

The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected...They would still drink for free...But what about the other six men - the paying customers? How could they divide the $20 windfall so that everyone would get his 'fair share?'...They realized that $20 divided by six is
$3.33...But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer. So, the bar owner
suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay.

And so:
The fifth man, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33%savings).
The seventh now pay $5 instead of $7 (28%savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before...And the first four continued to drink for free...But once outside the restaurant, the men began to compare their

savings.

"I only got a dollar out of the $20,"declared the sixth man. He pointed to the tenth man," but he got $10!" "Yeah, that's right," exclaimed the fifth man.

"I only saved a dollar, too. It's unfair that he got ten times more than I!"



"That's true!!" shouted the seventh man. "Why should he get $10 back when I got only two? The wealthy get all the breaks!"



"Wait a minute," yelled the first four men in unison. "We didn't get anything at all. The system exploits the poor!"

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill!

And that, ladies and gentlemen, journalists and college professors, is how our tax system works. The people who pay the-- highest taxes-- are entitled to get the most from a tax reduction. Tax them too much, attack them for
being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.

David R. Kamerschen, Ph.D.
Professor of Economics
University of Georgia

For those who understand, no explanation is needed.
For those who do not understand, no explanation is possible.

Wonder how many will blast this post.. And yes its an old old one, but still...

I see someone misunderstands how our progressive tax system works. Sad that it's a professor of economics.

Did my Uncle forward this thing to you, too? 

Damn.  He's got EVERYBODY on his crappy-email-forward list.

Quote from: nathanm on December 10, 2010, 06:36:28 PM
I see someone misunderstands how our progressive tax system works. Sad that it's a professor of economics.

Oh I think this prof knows EXACTLY how the "progressive tax system" works. You just don't like it dumbed down to the point where its unfairness is easily exposed. But hey, feel free to enjoy being one of the four men livin large off the tenth man.

Quote from: guido911 on December 10, 2010, 07:55:50 PM
Oh I think this prof knows EXACTLY how the "progressive tax system" works. You just don't like it dumbed down to the point where its unfairness is easily exposed. But hey, feel free to enjoy being one of the four men livin large off the tenth man.

No, he does misunderstand. He makes the common mistake of thinking that a reduction in the rate for the lower tax brackets does not also reduce the rate for people earning more than the cutoff for that particular bracket. Maybe he actually gets it but thinks other people won't understand and glosses it over to make it work as a parable.

Either way, it's dumb as a box of rocks.

Quote from: nathanm on December 10, 2010, 10:14:17 PM
No, he does misunderstand. He makes the common mistake of thinking that a reduction in the rate for the lower tax brackets does not also reduce the rate for people earning more than the cutoff for that particular bracket. Maybe he actually gets it but thinks other people won't understand and glosses it over to make it work as a parable.

Either way, it's dumb as a box of rocks.

Why is it that an American living in this country should pay more in taxes than any other American living here? I really want to know why it costs more for me to live here than you. Tell me.

Quote from: nathanm on December 10, 2010, 10:14:17 PM
No, he does misunderstand. He makes the common mistake of thinking that a reduction in the rate for the lower tax brackets does not also reduce the rate for people earning more than the cutoff for that particular bracket. Maybe he actually gets it but thinks other people won't understand and glosses it over to make it work as a parable.

Either way, it's dumb as a box of rocks.

I don't feel like figuring out your way. (Too lazy and may use different assumptions.) Please do the math for the example above doing it your way.

Quote from: guido911 on December 10, 2010, 10:35:58 PM
Why is it that an American living in this country should pay more in taxes than any other American living here? I really want to know why it costs more for me to live here than you. Tell me.

Because the tax is a percentage of your income, silly.

As for how it is that a tax cut for the lower and middle-income brackets translates to a cut for people making over that? You don't pay a flat 35% on all of your income just because some of your income is taxed at the top rate. All of your income below the top rate is taxed at the applicable rate for that bracket.

Say you file married filing jointly and your family's income is $200,000, after the exemption and any applicable deductions. Presently, you pay about $44,000 in tax, or about 22%, and you would not be affected by the contemplated reversion to the former rates. If your family's taxable income were $250,000, you presently pay about $60,000 a year in tax (24%), and would pay an extra 3% on the income over $209,250, so about $1,222 (six tenths of one percent) more each year if the Bush rates were to expire. If your family's taxable income were $400,000, you presently pay about $110,000 a year in tax (27.5%) and would pay an extra 3% on income between $209,250 and $373,650 and an extra 4.6% on income over that, for a total of $6144, or 1.5% of the total income.

A couple earning a cool million a year (after deductions) presently pays $320,000ish in tax (about 33%). They would pay an extra 4932 + 28812, or an extra 3.3% of total income.

Conversely, if the bottom 3 brackets were each dropped 5%, every couple earning over $137,300 would pay $6865 less in tax each year, because the first $137,300 would be taxed at 5% less. Thus, a tax cut for lower income earners is a tax cut for everyone.

The failed parable makes it seem as if a cut in the price of beer for the lower brackets without a cut in price for the higher brackets would not in fact reduce the price of beer for everyone who already pays for beer. He also vastly inflates the difference between the lowest and highest beer price brackets. There is no 59% tax bracket, nor a 1% tax bracket. I guess I could rewrite the whole thing, but that seems like more effort than it's really worth.

Quote from: nathanm on December 11, 2010, 07:35:13 PM
Because the tax is a percentage of your income, silly.

That is a fantastic non-answer. I pay more because I am supposed to pay more.

Quote from: guido911 on December 11, 2010, 08:05:04 PM
That is a fantastic non-answer. I pay more because I am supposed to pay more.

So you don't think that taxes should be based on a percentage of yoru income?

Quote from: guido911 on December 11, 2010, 08:05:04 PM
That is a fantastic non-answer. I pay more because I am supposed to pay more.

You pay more because we think your money is better than the other people's money. We really just can't get enough of it. It's only natural that we use the power of the state to take as much of it as we can.

Quote from: we vs us on December 11, 2010, 11:00:35 PM
You pay more because we think your money is better than the other people's money. We really just can't get enough of it. It's only natural that we use the power of the state to take as much of it as we can.

If his money is better (worth more) than other people's money, it shouldn't take as much of it to pay his fair share. If his money was worth less (or maybe worthless) then taking as as much of it as possible would be required for him to pay his fair share.  Make up your mind.

The issue really is that because someone has more, the people with less (and the people running for office that want people with less to vote for them) think that the people with more should pay the way for everyone.

Quote from: nathanm on December 11, 2010, 07:35:13 PM
The failed parable makes it seem as if a cut in the price of beer for the lower brackets without a cut in price for the higher brackets would not in fact reduce the price of beer for everyone who already pays for beer. He also vastly inflates the difference between the lowest and highest beer price brackets. There is no 59% tax bracket, nor a 1% tax bracket. I guess I could rewrite the whole thing, but that seems like more effort than it's really worth.

The so-called failed parable makes the assumption that each person paying should pay approximately the same percentage before and after the discount but actually gives a slight advantage to all but the top payer.

The new bill is 80% of the original bill
80% of $1 is $.80, drop the fraction and the bottom paying guy pays nothing.
80% of $3 is $2.40, drop the fraction and his bill is $2, 2.5% of $80.
80% of $7 is $5.60, drop the fraction and his bill is $5, 6.25% of $80
80% of $12 is $9.60, drop the fraction and his bill is $9, 11.25% of $80
80% of $18 is $14.40, drop the fraction and his bill is $14, 17.5% of $80
2+5+9+14=$30, leaving $50, not $49, for the last man to pay.  Roundoff obviously enters the math.
$50 is 62.5% of $80. (The rich guy previously paid 59%.)

It is unlikely that the "failed parable" was intended to exactly match the tax brackets. It is more likely to have been an exercise to show a principle and get folks to think of unintended consequences of pursuing the popular path.

http://www.snopes.com/business/taxes/howtaxes.asp


If your goal is to have the rich pay a higher percentage of the total bill, we can proceed from there.

Lowering the marginal rates at the lower income level without lowering the marginal rates at the higher income levels will reduce everyone's total number of dollars on the tax bill.  It will, however, shift the burden in terms of percentage (not just $) to the higher brackets.  Let's take this to a limit (remember Calc I?).  Let's eliminate all income taxes below $200,000.  ($250,000 sounds nice but not everyone is married with a home mortgage.) Even the wealthiest will see a reduction in their total tax dollars since, as Nathan points out, not all dollars are taxed at the highest level.  Now all the taxes are the responsibility of those making more than $200,000.  While that would help me significantly,  I don't think it would be fair.  Short of providing too much information, my income is considerably less than $200,000.

The above does not, and is not intended to, address Social Security, property, and sales tax.

Social Security presently has benefits based on contributions.  Everyone should get more out than they put in just based on the time value of money. (Interest paid on deposits.)  I am well aware that payments are a generation behind but the concept of getting more actual $ out than you put in does not bother me.   The fact that rich people don't pay the same percentage of their gross adjusted salary doesn't bother me either since their benefits will depend only on the income on which they paid social security taxes, not their gross income.

Everyone pays property tax.  If you rent, part of your rent pays property tax.  Renting is frequently less expensive than owning because the properties are typically older and less expensive or of lesser quality. Some of the higher rents for new development or refurbs downtown represent the cost of those projects. Rich people typically pay a lot more property tax because they typically live well.  Better than me anyway.

Sales taxes can be remedied by not putting sales tax on necessities. I don't know the present status but when I lived in PA, there was no sales tax on food, clothing, and prescription drugs.  Soda/pop was taxed, cauliflower was not. Swim suits were taxed, underwear, slacks, shirts, blouses, dresses, etc were not taxed. It would be even less difficult now with all the computers involved in retail sales.  Sales tax does not need to be regressive on necessities.  You want a color, large screen TV?  That is not a necessity and I don't care what percentage of your income it costs, pay the tax.

The comments I saw on the Snopes site typically attacked the fairness rather than the math.

Nathan, I am truly surprised that you cannot see the principle of the parable even though I thoroughly expected you to disagree with the concept. Requiring the parable to exactly follow the present income tax  codes and marginal rates is beneath you.

Quote from: custosnox on December 11, 2010, 09:18:02 PM
So you don't think that taxes should be based on a percentage of yoru income?

I can't speak for Guido, but there are some that believe that taxes should not be based on a percentage of their income. Some believe the income tax is wrong, period.  The other alternatives include property tax. Why should I pay money to the government to keep something I already own?  The other common alternative is a consumption or value added tax. This is usually considered "regressive" but could be reasonable if necessities were exempt.  Defining "necessities" could be as difficult as defining "income".  "Use tax" is one of my least favorites.  It usually is equal to the sales tax for something bought out of state.  Buy a shirt on the internet and you owe "use tax" in order to own it in the state of your residence.  Some states are even worse than Oklahoma.  Take your airplane to Maine and land at an airport there and you owe use tax equal to the Maine sales tax on the purchase price (or maybe fair market value) of your airplane.(Details may not be exactly correct but the principle is.)  This may have changed since I last looked but you can be sure I am NOT going to Maine in my airplane.

Just remember..... It is NOT your money.... and  you will be a happy camper.  Broke but happy.

Given that we have an income tax:
I believe that if I make twice as much as someone else, my taxes should be twice as much as theirs, not more than twice as much.  The exception to that would be a deduction for a basic cost of living for everyone regardless of their income.  Make $50,000 and you get a (pick a number) $20,000 deduction. Make $50,000,000 and you get the same $20,000 deduction.  This is obviously a lot larger percentage of your income if you make $50,000 than if you make $50,000,000.  Advantage: poor guy.  Taxable income in this example would be anything above $20,000.  I am not in favor of giving everyone with an income (in this example) less than $20,000 an amount required to bring their income up to $20,000. "Everyone" would include dependents on someone else's return.

I am well aware of the "let them eat cake" syndrome.  I am willing to help someone unable to help themselves. I am unwilling to help those unwilling to help themselves.

The reason for progressive taxation is that the 200,000th dollar of income has more marginal utility than the 20,000th dollar. Roosevelt once said that higher income earners should feel privileged to be in a position to pay more.

Beyond that, there are useful economic reasons to have higher income earners paying more of the total bill. The velocity of the 20,000th dollar is far higher than the 200,000th dollar. It's much more likely to be spent and thus generate economic activity. Moreover, it's more economically efficient to have less drastic (but not no) variation between the spending power of the highest income earners and lower income earners. It gives the higher income earners, who often make much of their income selling stuff to other people, a bigger market in which to sell.

Additionally, people who have a higher income generally use more of the resources provided by the state.

A lot of folks like to claim the only justification for progressive taxation is jealousy, but that's clearly not the case. The parable attempts to gloss over that fact.

Understanding the progressive tax system is not the same as justifying it.   Maybe if I made enough money to live comfortably on a small portion of my income I wouldn't mind paying a lot higher percentage of it in taxes.  Unfortunately, that is not the case.

I'm not at all opposed to changing the brackets around some. I think it's kind of ridiculous that the 10 millionth dollar is treated equally to the 500,000th dollar. By no means do I advocate a return to our confiscatory wartime tax rates (barring a return to total war), but I think the current structure is stupid on many levels.

Nathan, higher income earners use more of the resources of the state? I would have thought just the opposite. They definitely provide more resources to the state.

Quote from: bokworker on December 12, 2010, 11:58:29 AM
Nathan, higher income earners use more of the resources of the state? I would have thought just the opposite. They definitely provide more resources to the state.

They are more likely to use the roads more. They are more likely to fly more often, they are more likely to own a business. So yeah, the wealthier you are, the more likely you are to rely upon the resources of the state, just not in the form of cash payments. Ironic, isn't it?

In general, as it pertains to the parable, the real issue that is highlighted is that once a significant portion of the population pays no tax then the lose all sense of accountability on how tax dollars are spent. It is this issue that I think poses the biggest risk going forward and why I have stated that any plan enacted must "hurt", or alternatively, be paid for by EVERYONE. Only then will we have a chance to realistically have an honest debate about spending priorities going forward. When roughly 45-48% of your population doesn't have any skin in the game then you inevitable end up with an inability to deal with both the revenue AND spending side of the equation.

ok, I will give you road use, although I am not sure that miles driven are directly correlated to income, but fly more? And that uses state resources how? We don't fly for free and these are private, for profit, businesses. And last I checked,owning a business, on net, creates wealth and is not a net drain on the resources of the state.

Quote from: bokworker on December 12, 2010, 12:03:13 PM
When roughly 45-48% of your population doesn't have any skin in the game then you inevitable end up with an inability to deal with both the revenue AND spending side of the equation.

I disagree. The people with skin in the game are precisely the ones running the show. If skin in the game would result in a rational outcome, we wouldn't be in the situation we're in.

Um, the government pays for air traffic control. The government builds the airports. The folks with private planes don't pay landing fees at most airports they're likely to fly into. (aside from the fools who land at DFW or LGA or other major airports) Air travel is significantly subsidized by the government. I'm OK with that, just as I'm OK with government paying to build roads, but let's not pretend it doesn't exist.

I didn't say that owning a business was a net drain or net gain for the state, I was merely acknowledging that that business likely uses many services of the state, whether it be the roads to deliver goods, police and fire protection, or to the necessary regulations on that business. Again, at least part of the higher tax rate goes to paying for what they use more of. With greater consumption comes greater resource utilization.

Quote from: nathanm on December 12, 2010, 12:09:34 PM
Um, the government pays for air traffic control. The government builds the airports. The folks with private planes don't pay landing fees at most airports they're likely to fly into. (aside from the fools who land at DFW or LGA or other major airports) Air travel is significantly subsidized by the government. I'm OK with that, just as I'm OK with government paying to build roads, but let's not pretend it doesn't exist.

I didn't say that owning a business was a net drain or net gain for the state, I was merely acknowledging that that business likely uses many services of the state, whether it be the roads to deliver goods, police and fire protection, or to the necessary regulations on that business. Again, at least part of the higher tax rate goes to paying for what they use more of. With greater consumption comes greater resource utilization.

Um, you are not entirely wrong but the aviation community is not totally on a free ride either. Jet fuel has a $21.9/gal tax (imagine the gallons to fill a Boeing 777) and aviation gasoline (100LL) has a $19.4/gal tax that goes directly to the Feds for the purposes of the air transportation system. That includes ATC.  Tulsa has an additional fuel flow fee, $.15/gal I believe, at TUL and RVS which goes to Tulsa airports.  The present price of airplane gas is over $5/gal at RVS.  It was $3.80 at Henryetta a few weeks ago.  Granted, there are services at RVS that are not available at Henryetta but many of the services are related to the Fixed Base Operator (FBO) such as crew lounges, courtesy cars, and computers to obtain weather information.  The FBO provides them, not the government.  At many small airports, there are no services. No fuel, no restrooms, not even a place to get out of the sun while waiting to get picked up. There are all kinds of levels of service in between Full Service airports like TUL and no services.

http://www.nbaa.org/advocacy/issues/modernization/fuel-tax.php

The big airports are, of course, built by the government.  The Airport Authority gets income from a lot of sources.  I pay ground rent for the land my hangar sits on at RVS.  We could argue about the price relative to other storage in town but the fact remains that use of the land is not free. I also have to provide liability insurance for the Airport Authority for my hangar.  If some one breaks into my hangar and hurts themself and then sues me and/or the airport authority, my insurance covers the first $1 Million.  I am not arguing the fairness, only that it is another expense. Do you have to pay that at a mini-storage on top of the rent? At places like TUL, the concessions and other activities pay fees  to the airport for the privilege of being there. There is also the previously mentioned fuel flow fee.  I don't know the balance of money at the airport but it it NOT All coming from the general fund. There are also matching grants from the FAA which, ideally, come from the fuel tax.

Landing fees for small airplanes are not particularly common around here but a lot of places will have a ramp fee or overnight parking fee for even small planes.  Sometimes the ramp fee will be waived if fuel is purchased.  I (actually my boss, I was co-pilot) encountered landing fees at some smaller airports in the more congested areas along the east coast about 10 years ago.

Just like roads, airports bring in business that may not otherwise be there so the balance of the subsidy is difficult to determine.

Quote from: nathanm on December 12, 2010, 12:00:26 PM
They are more likely to use the roads more. They are more likely to fly more often, they are more likely to own a business. So yeah, the wealthier you are, the more likely you are to rely upon the resources of the state, just not in the form of cash payments. Ironic, isn't it?

In this part of the country, I am not convinced the wealthy use roads more than the average person. The particular roads they use may be different. Average Joe drives to work and gets groceries etc.  How about the weekend trip to the lake with the Bass boat.  You don't need to be a millionaire to have a little fun.  Boats and motors have user fees involved too. Still no totally free ride but again many of the middle class participate.  If you live in a place like NYC, most people use public transportation of some sort. Almost all public transit is subsidized which is OK by me.  Judging by airport crowds, especially on holidays, middle income America flys a lot too.  Granted, wealthy people are more likely to own a business that employs many others.  There are a lot of small business that may only be the owner and a helper or two.  I am thinking specifically of businesses like lawn and tree services.

So yeah, maybe the wealthy use more services from the state than they would like to admit but I don't believe it is a foregone conclusion that the wealthy use a disproportionate amount of state services.   It is highly unlikely that the wealthy will require food stamps, free lunch for school kids, transportation for the physically impaired (no intention to insult anyone if I used the wrong PC term) and other programs available. I am not judging their worth here, only their cost and who is likely to use them.

Quote from: custosnox on December 11, 2010, 09:18:02 PM
So you don't think that taxes should be based on a percentage of yoru income?

Nope. Particularly since what, 47% pay no federal tax despite earning income. Everyone should pay since everyone enjoys the benefits of living here.

Thanks for those responses Red. I am not up on the aviation industry and yet I do know as a regular business traveler that there are any number of fees and taxes paid that I would assume go to cover the cost of the FAA and TSA among others. Maybe that is a bad assumption I just know the fees in addition to the air fare are not immaterial. In any event, these are user fees paid for by those individuals that use the air transportation network. Hence, if you don't fly you don't pay.

I just cant get my mind around the wealthy using roads more often...maybe because each of their kids has a car? But again, I don't suspect that miles driven is correlated to income above a certain level. Maybe so when you go from below the poverty line where a bigger share of individuals don't own cars. And yes, a wealthy individual can own multiple cars but they can only drive one at a time.

When I think of state resources I think about the items you mentioned...food stamps, welfare, subsidized rent, etc and in that arena the wealthy do not use state resources at a higher level.

Quote from: we vs us on December 11, 2010, 11:00:35 PM
You pay more because we think your money is better than the other people's money. We really just can't get enough of it. It's only natural that we use the power of the state to take as much of it as we can.

Finally someone gets it.

Quote from: guido911 on December 12, 2010, 01:44:05 PM
Nope. Particularly since what, 47% pay no federal tax despite earning income. Everyone should pay since everyone enjoys the benefits of living here.

While I am not sure I am totally with you that taxes should not be tied to income we both point to the same issue about the number of Americans who do not pay income tax.

Nathan, does the concept of one man on vote ring a bell? In excess of 40% of our populace pays no income taxes and yet their vote counts just as much as the person making a gazzillion dollars a year. Those at the top are not running the show..or better put, are periously close to having no say whatsoever. The second that the non tax payers of this country exceed's 50.1% we are screwed. You have huge numbers of people that are entirely unaffected by tax policy, as it now stands, shouting to the heavens that our tax code is unfair. What they are really saying is do something to make my status even more secure. and they have the power to vote to make it so and that makes elected officials pander to their vote.

Quote from: guido911 on December 12, 2010, 01:47:30 PM
Finally someone gets it.

I think we vs us was being sarcastic... and yet in his sarcasm is a grain of truth

Quote from: nathanm on December 12, 2010, 11:19:50 AM
I think it's kind of ridiculous that the 10 millionth dollar is treated equally to the 500,000th dollar.

I don't.  I'll go along with treating the 500,000th dollar differently than the 5000th dollar. Everyone needs that 5000th dollar to live.  It's a matter of degree.

Using the Tax Rate Schedule from the 2006 (first one I found in my file cabinet) 1040 Forms and Instructions booklet, page 84

$15,107.50 + [.28 x ($10,000,000 - $74,200)] = $2,794,331.50

$15,107.50 + [.28 x ($500,000 - $74,200)] = $134,331.50

Even at a flat rate of 28% above taxable income of $74,200, you will have a difficult time convincing me that the guy with $10,000,000 income did not pay more tax than the guy with $500,000 income.  This obviously excludes tricky tax avoidance schemes which I would agree need to be closed. Whether or not Capital gains should be treated differently is also not intended to be  part of this example Herion.

For those who insist that the higher income person pay a higher percentage of their income in taxes:

$2,794,331.50 / $134,331.50 = 20.8

$10,000,000 / $500,000 = 20.0

The $10 Million guy earned 20 times the $500 K guy but paid 20.8 times the taxes due to the first $74,200 being taxed at lower rates than 28%.

$2,794,331.50 - (20 x $134,331,50) = $107,701.50 

I'd sure like to have an extra $107K

Quote from: bokworker on December 12, 2010, 01:58:54 PM
I think we vs us was being sarcastic... and yet in his sarcasm is a grain of truth

I know. I was attempting to acknowledge that.  I guess I failed.

Quote from: bokworker on December 12, 2010, 01:47:08 PM
And yes, a wealthy individual can own multiple cars but they can only drive one at a time.

I own two cars, the newest is a 1998.  Whenever I need to take them both somewhere I actually use more than my fair share of state resources since I also need a sidewalk.

I drive one car a mile. Then I walk back to the second car, drive it a mile past the first car, then walk back to the first car and repeat the process.

JUST KIDDING!   ;D ;D ;D

Quote from: bokworker on December 12, 2010, 01:57:02 PM
While I am not sure I am totally with you that taxes should not be tied to income we both point to the same issue about the number of Americans who do not pay income tax.

That's okay that we may differ about taxes being tied to income. But you are spot on with the rest of your post. Those 40%ers vote is their method of earning a living.

Here are videos of the "Nathans" in this country:

Quote from: guido911 on December 12, 2010, 02:12:59 PM
I know. I was attempting to acknowledge that.  I guess I failed.

If you aren't sure someone will catch your intentions (frequently around here and not just your replies) use a stupid smiley face.

Quote from: bokworker on December 12, 2010, 01:57:02 PM
Nathan, does the concept of one man on vote ring a bell? In excess of 40% of our populace pays no income taxes and yet their vote counts just as much as the person making a gazzillion dollars a year. Those at the top are not running the show..or better put, are periously close to having no say whatsoever. The second that the non tax payers of this country exceed's 50.1% we are screwed. You have huge numbers of people that are entirely unaffected by tax policy, as it now stands, shouting to the heavens that our tax code is unfair. What they are really saying is do something to make my status even more secure. and they have the power to vote to make it so and that makes elected officials pander to their vote.

Income taxes are not the only form of tax. Almost everyone pays something.

And the terrible irony of the people shouting about the unfairness of the income tax system is that the majority of them aren't the ones paying the majority of the income tax. I don't think guido is a one percenter, given that he claims to be "middle class."

And a large part of the reason that so many end up paying no income tax is because we as a society have decided it's a good idea to give tax breaks to people with kids. Were it not for the EITC and related credits, nobody would get more than $8000 or so tax free. Even then, it takes a ridiculously low income to not have to pay any income tax. Is it really reasonable to complain about people living below the poverty line not paying income tax? Moreover, the 47% don't pay any income tax meme is quite misleading, as there are more than a few older folks with Roth IRAs that were taxed in the year they earned the IRA money but aren't taxed now, among other ways people get away without paying income tax yet still have a positive cash flow.

That number shows, quite starkly, that a lot of my fellow citizens are in bad financial shape. Rather than complain that they get to not pay income tax, I both think how lucky I am to be better off than them and wonder how it is that we can help them improve their lot in life so they too can start paying income tax.

Besides, in bad years plenty of rich people don't pay a dime in income taxes. Should we complain about them? I don't begrudge them being allowed to deduct losses, just like I think it's crappy when they have to pay income tax on unrealized gains from stock options.

Anyway, I think we can all see (or at least most of us, guido is too busy acting a fool) that the typical pithy statements made by some on the right who try to argue that higher income earners pay more than their fair share aren't accurate. The underlying issues are far more complex than either side would like to admit.

There was a reason an income tax was specifically prohibited in the US Constitution.  It is a lousy way to tax.  But what you got that's any better?  (Well, send all taxes through corporations, but that is in a different thread.)

And the edge the richest have is the FACT that they not only can, but have had undue influence on the tax laws of the country.  It is a grotesque mockery when Warren Buffet pays a lower rate of taxes than his secretary.  As he will tell you.

This whole discussion centers around the rather naive idea that someone making 2 million per year is likely to pay anything anywhere near the "tax table" numbers.  In fact, I will go one step further and submit that no one making $2 million per year is allowing anywhere near that amount to end up on their W-2.  I certainly won't if get to that point, and the law is the same as today.  Even people like the Abercrombie and GM CEO's will only show several hundred of thousands on the W-2.  It's ALL about the ISO!!  (Incentive Stock Option)

It's those sticky little points like the "tricks" that Red mentioned (ISO is one) that make such a grotesque mockery of taxation in this country.  It's all about the tricks and games.  If those little games weren't played, there would be no deficit.  There would be no debt.  There would be much lower REAL tax rates across the board.  Wouldn't need a VAT.  No class warfare as it exists today.  There would be no Social Security crisis. 

And likely no pain of psoriasis!

But there would also be no special treatment for the rich.  It would cost them a little more - as a percentage.

And in the interest of attempting to prove the willingness to listen, I will ask again;  what system would be fair?  How would it be structured?  (Let it stay like it is, but give Guido a 100% deduction?)

I have heard Warren Buffet make the claim about his income taxes and other "millionaires" claim they feel they should pay more in tax. I suppose I would aska couple of questions....

Warren, are you, or your CPA's pursuing any investment strategies where the primary benefit is lower or reduced taxation? If so, based on how you feel, why are you doing that?

Various wealthy that say they should pay more tax, same as Warren above but in addition, can you not write a check payable to the IRS so you feel better?

My take, close the damn loopholes that allow for an investment strategy where the primary benefit is tax savings. Using the tax code to encourage savings or investment in a particular sector or industry does nothing but cause a misallocation of capital that results in future economic dislocation. We have been on this road for so long that the solution will hurt but not doing it is like staying on a bad drug habit that you know will eventually kill you.

These are easy to answer.

QuoteWarren, are you, or your CPA's pursuing any investment strategies where the primary benefit is lower or reduced taxation? If so, based on how you feel, why are you doing that?

Last year Warren paid 17.7% in taxes on income.  He employs several strategies to shelter his income including sheltering money outside of the United States.

QuoteVarious wealthy that say they should pay more tax, same as Warren above but in addition, can you not write a check payable to the IRS so you feel better?

Not a chance.  That would be foolish.  Basically what he is saying is "force me to pay more, and I will, but I will make more off of the resulting turmoil and market fluctuation anyway." 

Changes in the tax code cause vast fluctuations in the market and the valuation of companies.  Powerful, wealthy investors with the capital and resources to take advantage of these fluctuations make a lot of money from such changes.  We simply suffer, because the companies that are affected negatively are our employers.

The worst of these offenders are people like George Soros who made his fortune and continues to make vast amounts of money betting on currency values. They have become so powerful that when they open their mouths and make comments they can affect the world markets.  Economic upheaval and a loss of value in the US Dollar is how George Soros became a billionaire.  If he could affect that change again, I believe he would. 

Quote from: Gaspar on December 13, 2010, 07:51:42 AM
The worst of these offenders are people like George Soros who made his fortune and continues to make vast amounts of money betting on currency values.

The entire stock market is gambling on values.

I think the worst offenders are the Koch Brothers (tea party puppeteers).

They are listed annually as one of the top ten polluters. They have been found guilty of dumping millions of gallons of pollutants into the Mississippi River and streams all over the country. Their pipeline have had as many as 300 major spills a year and last year they admitted guilt in 680 environmental violations. In 1999, they were found guilty of stealing oil from government and Indian lands and court records showed they lied about the oil purchases 24,000 times.

Lying, stealing and polluting should be the Koch Brothers slogan. 

Quote from: bokworker on December 13, 2010, 07:22:02 AM

Various wealthy that say they should pay more tax, same as Warren above but in addition, can you not write a check payable to the IRS so you feel better?

This is the standard comeback, but (purposefully?) misunderstands Buffet's argument. Taxes work because everyone pays them regularly, not because one guy or gal donates a one time lump sum to the government.  He's not arguing that he, individually, should pay more.  He's arguing that he and other like him should pay more. It's a policy argument, not a personal "gee-I-feel-bad-because-I'm-sooo-stinking-rich" argument.

I know, I know . . . it's heresy amongst some of the conservative set to volunteer your cohort for MORE taxes, but that's what he (and others) are doing.

Good reason to reduce economic inequality . . . more people with $$ means more people sharing the burden.

Quote from: RecycleMichael on December 13, 2010, 09:02:10 AM

The entire stock market is gambling on values.

I think the worst offenders are the Koch Brothers (tea party puppeteers).

They are listed annually as one of the top ten polluters. They have been found guilty of dumping millions of gallons of pollutants into the Mississippi River and streams all over the country. Their pipeline have had as many as 300 major spills a year and last year they admitted guilt in 680 environmental violations. In 1999, they were found guilty of stealing oil from government and Indian lands and court records showed they lied about the oil purchases 24,000 times.

Lying, stealing and polluting should be the Koch Brothers slogan. 

We should tell the EPA and local organizations to stop giving them Environmental, health, and safety awards.  They won 185 of them last year.

Quote from: we vs us on December 13, 2010, 09:25:14 AM
Good reason to reduce economic inequality . . . more people with $$ means more people sharing the burden.

How do you do that?

Quote from: we vs us on December 13, 2010, 09:25:14 AM
Good reason to reduce economic inequality . . . more people with $$ means more people sharing the burden.

And that we vs us is a completely different discussion. To what I think Gaspar's point is, I am not sure how we do it but I feel pretty strongly that the tax code is NOT how you reduce economic inequality. I would agree that income equality is a major issue for us. But rather than trying to tax your way to equality our time would be better spent on how indivduals are compensated. In other words, taxing comes after earning, the solution to this problem is with the earnings not the taxation.

Quote from: bokworker on December 13, 2010, 10:30:02 AM
I am not sure how we do it but I feel pretty strongly that the tax code is NOT how you reduce economic inequality.

+1

Get out of my head!

Warren says that under this set of rules, he and people like him should be paying more.  In the context of people like his secretary is having to pay a certain amount due to the rules the way they are.

I have no doubt that he would appreciate paying even less than he does, as long as his secretary also gets to pay equitably and proportionately less.  That is NOT the way it works today, though.  

This disparity in the tax situation is due in great part to the opportunity for "face time" that I have touched on a time or two where the rich get privileged access to the representatives who are supposed to be representing the general populace.  Inhofe comes to mind most immediately with his bragging about the millions he has received from big oil and others and publicly stating that it is not enough.  He feels they should give him more.

Haven't heard Coburn or Sullivan bragging about it that way.  (They may talk about it to friends behind closed doors??)  In addition to all his other problems that I have dwelt on ad-nauseum (sp?), this points out the absolute arrogance and hubris of the man and his overwhelming confidence that he has so convincingly conned the state voters that they will keep on electing him no matter what.

And so far, he has been right; for a public 'lack-of-service' life that spans decades!

How many times will people vote against their direct fiscal, physical, mental, and emotional interest??  Well, since late '60s anyway.

Quote from: Gaspar on December 13, 2010, 09:26:10 AM
We should tell the EPA and local organizations to stop giving them Environmental, health, and safety awards.  They won 185 of them last year.

Yes. The polluters have their own fake environmental groups that award themselves. And surprisingly, politicians they have supported also give them awards. In fact, President Bush appointed a vice-President of the firm to serve as EPA's Inspector General. After Koch donated $800,000 to republican candidates during the election cycle, the administration dropped most of the charges and plea bargained the fines to a fraction of the amount.

Who could believe that industry could pay off politicians?

Quote from: Gaspar on December 13, 2010, 09:27:17 AM
How do you do that?

Would it surprise you to hear that one of my suggestions would be to take Mr. Buffet up on his suggestion?

Nah, didn't think so.

In my opinion, we've created a system that funnels a good amount of the wealth in our society to the top tier.  This is through taxes, primarily, but also through corporate law and statute.  Many people at the top are there no longer by dint of their hard work and success.  They're there because they've rigged the system to keep themselves up there.  I'm not talking about you, or Guido, or anyone else still in the middle class.  I'm talking about the people who are in the stratosphere and control resources that dwarf all of ours' combined. 

We have well-reasoned and litigated arguments for why that sort of monopolization is bad for corporations; I think there's a similar argument to be made for individual wealth.  When it starts to distort healthy functioning of a market (or government), we've got problems.  I think that's where we are.

And in any event, I don't have a problem with success through hard work.  That will be the place that Guido jumps to immediately, but I credit what success I have to that very thing, and hope that my continued hard work will pay off more in the future.  The problem is, there is less and less of a chance of that happening.  Not because I will work less hard but because the deck is stacked away from my possible success regardless of how hard I work.   

I don't know how to address an unequal economic system outside of government power (taxes); allowing the economic system to regulate itself leads manifestly to bubbles and collapses like we're living through.  Even Greenspan admitted as much.  Outside of that, what is there?  Individuals organically deciding for themselves?  Forgive me, but I'm a skeptic and believe enough in markets and incentives to know that for the mass of men there's very little incentive to work together spontaneously to create more rather than less opportunity.

Roger, cancel the American dream for we vs us.

I'm going to just pull the important stuff out of that.

QuoteThey're there because they've rigged the system to keep themselves up there

If you have wealth, you want to preserve it.  I'll give you that.  Why should they have to "rig" the system, unless the system is inherently designed to confiscate wealth?

QuoteThe deck is stacked away from my possible success regardless of how hard I work.

That is a very poor outlook. Successful people rely on themselves for reward.  If you blame the system "the deck," you are looking for success or reward from the wrong source.  If you envy the success of others, then you own only failure.

QuoteAllowing the economic system to regulate itself leads manifestly to bubbles and collapses like we're living through.

What we are living through is a result of the manipulation of the housing market by the government.  Banks were pressured to make loans and put under penalty of investigation if they did not.  Investers viewed the packaged product as a guaranteed investment backed by government policies.  The result was a boom in home sales and the development of a massive economic engine (the building industry) fueled on the movement of equity by homeowners from properties that they could afford to properties that they could not, but perceived would increase in value without end. POP!

Without the initial manipulation, there would have been no bubble.

QuoteIndividuals organically deciding for themselves?

I believe that individuals should have the freedom to make ALL of their own decisions.  You insinuate through your choice of the word "Organic" that it is somehow wrong for people to be allowed to make their own decisions.

QuoteFor the mass of men there's very little incentive to work together spontaneously to create more rather than less opportunity.

Wrong!  The incentive exists, it always has, and always will.  The vehicle is diverse.  There will always be a minority that feels prosperity is legislated.  This interpretation is socialized over time and more of a psychological ill than something debatable.

Quote from: Red Arrow on December 13, 2010, 11:58:11 AM
Roger, cancel the American dream for we vs us.

It seems that he makes that call himself.

I had a TU professor tell me one time (long ago) in Econ 101 that national debt was no problem - it's just money we have to repay to ourselves.  And he actually said that with a straight face.  I didn't agree then (1970's), and I don't agree now. 

Some "long cycle" theories have the accumulation of wealth in fewer and fewer hands as a particular symptom of the declining sections of the cycle.  Becomes kind of "vapor lock" for the economy.

If that is true, then the whole idea of a "death tax" would be a good thing, no matter how distasteful I find it.  But then, just as Bill O'Reilly says, people who didn't earn the wealth have no right to it - Paris Hilton being the poster child in favor of nearly confiscatory death tax.  Kennedy's, Rockefellers, Richard Roberts, all the big heirs.  (Heirs, not to be confused with Heironymous.)

Kind of like Monopoly, when a player leaves the game, the money goes back into the pot - returned to the bank.

Here is an entry that might be of interest to some.
Debt is a huge factor in these cycles.

http://en.wikipedia.org/wiki/Kondratiev_wave

I see an inheritance not as a right of the receiver so much as the right of the giver to distribute their tax paid wealth where ever they want.  If the receiver is stupid, they won't keep it for long.  If the receiver is smart, the money will work for them and be invested somewhere.  Very few people keep money in their mattress. 

Quote from: Gaspar on December 13, 2010, 12:14:14 PM
What we are living through is a result of the manipulation of the housing market by the government.  Banks were pressured to make loans and put under penalty of investigation if they did not.  Investers viewed the packaged product as a guaranteed investment backed by government policies.  The result was a boom in home sales and the development of a massive economic engine (the building industry) fueled on the movement of equity by homeowners from properties that they could afford to properties that they could not, but perceived would increase in value without end. POP!

Without the initial manipulation, there would have been no bubble.

And right there should be evidence enough that the government picking the winners and losers does not end well.  Our government does nothing out of altruism.  A government's actions are for sale to the highest bidder as per Recyclemichael's post about large EPA fines being able to be reduced with substantial campaign contributions to the right people.  Either that or they are the sole discretion of a bureaucrat who has no accountability to voters.

What they call "fairness" is nothing more than a term for repaying those who helped get them elected.  In the case of housing, it was home builder's associations, mortgage bankers, hedge funds who invested in mortgage-backed derivatives, and community activists.

Again, I find it laughable anyone puts a whole lot of weight on Warren Buffett and Bill Gates view on their taxes being too low.  It's incredibly disingenuous.  They pay a lower rate of taxes by their own choice.  They could most definitely take much higher compensation in the form of salary and be taxed at a higher rate if they wished.  Instead they are paid in dividends which are taxed at a lower rate.  If tax rates on dividends rise, these two will continue to spend millions in tax avoidance and I would be surprised if their total net contribution to the treasury went up significantly, if at all.  It might even force them to *gasp* save even more and resort to more active and passive investment.

Quote from: bokworker on December 13, 2010, 10:30:02 AM
In other words, taxing comes after earning, the solution to this problem is with the earnings not the taxation.

The taxing changes the incentives. If people get taxed 90% on all your income over $40 million, there's less incentive to pay a CEO more than that. It's not so much taxing to take money away, although the tax does that, but to change behavior by changing incentives.

Not that there are probably many, if any, CEOs getting paid that much that get paid in ways that get taxed as earned income. Better to hold the options for a year and pay capital gains instead, after all, but it was the first example that came to my tired mind.

This article is freakin hilarious:

http://www.bernardgoldberg.com/thank-god-for-rich-people/

Funny, for sure.
And like so much revisionist history, GM was bailed out by Obama (when in reality, it was Bush that started it).  And we actually are gonna make money on that deal.

And the fact that 50% of the people in this country don't MAKE enough to pay taxes.

And the 700 billion stimulus that Obama was about 45% in the form of tax breaks for everyone that makes under 250k.  $290 billion of it.  And it is still working through the economy.  And the FACT that for all the bailouts of banks and auto companies, no improvement was seen for about a year, while the relatively small stimulus that got into the working peoples hands actually DID start to show results in less than 3 months.  March to June.

And the banks that were bailed out even earlier in the Bush administration.  Actually gonna make money on that deal, too.  (Boy was I wrong in being so against the bank bailout!)

And those richest ARE the richest because they are literally riding on the backs of that lowest paid 50%.

Hilarious article.  Kind of like Steve Martin for rich guys? 

Quote from: heironymouspasparagus on December 14, 2010, 12:54:49 PM
And the 700 billion stimulus that Obama was about 45% in the form of tax breaks for everyone that makes under 250k.  $290 billion of it.  And it is still working through the economy.  And the FACT that for all the bailouts of banks and auto companies, no improvement was seen for about a year, while the relatively small stimulus that got into the working peoples hands actually DID start to show results in less than 3 months.  March to June.

I found an old paycheck stub. Looks like my stimulus was about $5 per 2 week pay period.  I'll try not to spend it all in one place.

And yet, you still complain about Obama's stimulus?  5 bucks you didn't have before.  Just no pleasing some people.

Some people would still be bitchin' if they were farting in silk!

Quote from: heironymouspasparagus on December 14, 2010, 01:12:52 PM
And yet, you still complain about Obama's stimulus?  5 bucks you didn't have before.  Just no pleasing some people.

Some people would still be bitchin' if they were farting in silk!

I am happy to say that $5 every other week doesn't make the difference between food on the table or being hungry.  Unfortunately, it's not even beer money.  Give me a stimulus that I can actually buy something with.

Quote from: Red Arrow on December 14, 2010, 01:26:09 PM
I am happy to say that $5 every other week doesn't make the difference between food on the table or being hungry.  Unfortunately, it's not even beer money.  Give me a stimulus that I can actually buy something with.

Especially considering a Marshall's bomber is close to $6 a bottle now.  I did manage to get some El Cucuy and Big Jamoke over the weekend down in Norman, uh not with my stimulus funds.

Quote from: heironymouspasparagus on December 14, 2010, 12:54:49 PM
Funny, for sure.
And like so much revisionist history, GM was bailed out by Obama (when in reality, it was Bush that started it).  And we actually are gonna make money on that deal.

And the fact that 50% of the people in this country don't MAKE enough to pay taxes.

And the 700 billion stimulus that Obama was about 45% in the form of tax breaks for everyone that makes under 250k.  $290 billion of it.  And it is still working through the economy.  And the FACT that for all the bailouts of banks and auto companies, no improvement was seen for about a year, while the relatively small stimulus that got into the working peoples hands actually DID start to show results in less than 3 months.  March to June.

And the banks that were bailed out even earlier in the Bush administration.  Actually gonna make money on that deal, too.  (Boy was I wrong in being so against the bank bailout!)

And those richest ARE the richest because they are literally riding on the backs of that lowest paid 50%.

Hilarious article.  Kind of like Steve Martin for rich guys?  

I am not sure how we have made or are going to make money from GM when you look at what they received and what they have paid back. Here is a CNN Follow the Money link. After looking at this in total it really is scary.

http://money.cnn.com/news/storysupplement/economy/bailouttracker/

Quote from: Conan71 on December 14, 2010, 01:28:14 PM
Especially considering a Marshall's bomber is close to $6 a bottle now.  I did manage to get some El Cucuy and Big Jamoke over the weekend down in Norman, uh not with my stimulus funds.

How is the EC?  I keep meaning to get out and get some but I've restricted myself to Ranch Acres (although it likely is carried closer to me, but I KNOW RA has it).  Plus I need to stock up on the Jamoke.

You and FMC need to get to hockey game; a friend of mine plays on a league with Eric (maybe Eric sponsors the team, not sure he plays) and they now have sweaters (jerseys/uniforms for you non-hockey types) with the Jamoke label on them.  Not sure you can buy them unless you're on his mens league team though.

Quote from: Hoss on December 14, 2010, 01:39:16 PM
How is the EC?  I keep meaning to get out and get some but I've restricted myself to Ranch Acres (although it likely is carried closer to me, but I KNOW RA has it).  Plus I need to stock up on the Jamoke.

You and FMC need to get to hockey game; a friend of mine plays on a league with Eric (maybe Eric sponsors the team, not sure he plays) and they now have sweaters (jerseys/uniforms for you non-hockey types) with the Jamoke label on them.  Not sure you can buy them unless you're on his mens league team though.

Not sure how timing will work for FMC to be here for a game, but I want to go when I can get the time.  She's generally only here on weekends.

EC is some good stuff.  It's sort of like a porter, but with almost some fruity cru-like overtones if that makes sense.  It's a complex flavor, Eric is really showing his chops as a first rate brew master with this one.

Quote from: TulsaMoon on December 14, 2010, 01:29:34 PM
I am not sure how we have made or are going to make money from GM when you look at what they received and what they have paid back. Here is a CNN Follow the Money link. After looking at this in total it really is scary.

http://money.cnn.com/news/storysupplement/economy/bailouttracker/

I couldn't find anything out of your link to suggest what has been repaid by GM.  All I managed to find so far is an article which states they have repaid or intend to repay $9.5 bln from earnings and repay the remaining $40 bln from the IPO.

Interesting note from Politifact regarding the ads GM ran last spring claiming they had repaid their debt ahead of schedule:

"Aside from the outstanding stock issue, Whitacre's announcement has come under fire from Sen. Chuck Grassley, R-Iowa, who notes that the loans were repaid not with GM earnings (in fact, SEC filings show GM expected to have negative net cash flows in the fourth quarter of 2009) but rather from GM tapping into a multi-billion-dollar TARP-funded escrow account.

"Therefore, it is unclear how GM and the Administration could have accurately announced yesterday that GM repaid its TARP loans in any meaningful way," Grassley wrote in an April 22, 2010, letter to Geithner. "In reality, it looks like GM merely used one source of TARP funds to repay another. The taxpayers are still on the hook, and whether TARP funds are ultimately recovered depends entirely on the government's ability to sell GM stock in the future. Treasury has merely exchanged a legal right to repayment for an uncertain hope of sharing in the future growth of GM. A debt-for-equity-swap is not a repayment."

Grassley's claim about the origin of the money used to repay the loan was acknowledged by company and government officials.

In an April 21, 2010, interview on the Fox Business Network, GM's vice chairman, Stephen Girsky, was asked if GM is just paying the government back with government money.

"That is, in effect true," Girsky said. "But a year ago, nobody thought we'd be able to pay this back. They gave us five years to pay it back, we're paying it back in nine months. ... This is one step along the way in the road to recovery here.''

http://www.politifact.com/truth-o-meter/statements/2010/apr/27/ed-whitacre/ceo-says-gm-has-repaid-government-loans-full/

GM raised $20 bln on the IPO, so the government still has quite a bit of money at stake, at least 1/2 of their $40 bln.  Today's market cap shows $50bln at ~$34/share, but you can't simply dump all the shares held at once and I'm not 100% certain how much of the market cap is based on common and preferred shares.  I think the gov't owned 60% of the company prior to the IPO.   

Even though I'm very fiscally conservative and generally against the gov't picking winners & losers, I think there was a good served by the jobs and associated businesses which were saved by the bailout of automakers.

Quote from: Conan71 on December 14, 2010, 02:29:36 PM
Even though I'm very fiscally conservative and generally against the gov't picking winners & losers, I think there was a good served by the jobs and associated businesses which were saved by the bailout of automakers.

I'm not very fiscally conservative, but I still hate government subsidizing business and I also am happy it seems to have saved quite a few jobs and probably the future viability of Ford, who would have been screwed had all their suppliers gone out of business due GM being liquidated.

Quote from: nathanm on December 14, 2010, 02:33:20 PM
I'm not very fiscally conservative,

That's good news, I'm accepting hand outs from people who are fiscally liberal

Quote from: Conan71 on December 14, 2010, 02:43:54 PM
That's good news, I'm accepting hand outs from people who are fiscally liberal

Good luck with that...

Quote from: Conan71 on December 14, 2010, 02:43:54 PM
That's good news, I'm accepting hand outs from people who are fiscally liberal

Perhaps if I were more fiscally conservative, I'd have money to give you.

Although what I meant was that I don't think deficits matter one whit. I think I mentioned before that Cheney was right and I was wrong on that one.

Quote from: Hoss on December 14, 2010, 01:39:16 PM
How is the EC?  I keep meaning to get out and get some but I've restricted myself to Ranch Acres (although it likely is carried closer to me, but I KNOW RA has it).  Plus I need to stock up on the Jamoke.

The Crossing at 101st & Memorial had both last Friday.  (We can issue a one time Passport if needed.)

Quote from: Red Arrow on December 14, 2010, 03:19:01 PM
The Crossing at 101st & Memorial had both last Friday.  (We can issue a one time Passport if needed.)

I'm afraid upon providing my proof of the age of 21 that I will be assessed an import tax once my address is revealed.  Need something closer.

;D

Quote from: Conan71 on December 14, 2010, 02:29:36 PM
I couldn't find anything out of your link to suggest what has been repaid by GM.  All I managed to find so far is an article which states they have repaid or intend to repay $9.5 bln from earnings and repay the remaining $40 bln from the IPO.

GM received $49.9 billion of which they have repaid $361 million. GMAC received $13.5 billion of which zero has been repaid.

Automotive Industry Financing Program

General Motors     $49.9 Billion
(paid back)          $361 Million
Chrysler              $12.8 Billion
(paid back)          $280 Million
GMAC                 $13.4 Billion
Chrysler Financial $1.5 Billion
(paid back)         $1.5 Billion

Quote from: Hoss on December 14, 2010, 03:28:58 PM
I'm afraid upon providing my proof of the age of 21 that I will be assessed an importexport tax once my address is revealed.  Need something closer.
;D

You may also be assessed an import tax upon re-entering mid-town.

Quote from: nathanm on December 14, 2010, 02:50:45 PM
Perhaps if I were more fiscally conservative, I'd have money to give you.

Although what I meant was that I don't think deficits matter one whit. I think I mentioned before that Cheney was right and I was wrong on that one.

Cheney was dabbling in neo-keynesianism. 

Deficits don't matter if it's a temporary situation.  The idea is that it will create growth in recessionary times.  Slight problem though: We've been doing this going on 30 some years.  Year after year of deficit spending coupled with more and more debt and greater debt expense eventually becomes unsustainable.  Now we find ourselves $14 trillion in debt, but I guess that doesn't matter since we can simply eventually print the money to pay it back.  :o

Opinion piece on why they matter:

"Of all the reasons to be concerned about the so-called "twin deficits," the long-term effect on the dollar as a global store of value and medium of exchange is by far the most serious....

"There is a discomforting contrast to be drawn between the economy today and in 1985, when many were already proclaiming the U.S. current account deficit "unsustainable." Twenty years ago, when the U.S. current account deficit stood at 2.8 percent of GDP, foreign governments owned 8.4 percent of U.S. government debt outstanding. At the end of 2004, with the current account deficit at 5.2 percent of GDP, foreign governments owned a much higher 27.6 percent of the total debt outstanding. This is a cause for concern, as it represents a much greater concentration of holdings among a group that is prone to herding....

"The dollar has since fully supplanted gold as the foundation of the world's monetary system; a feat unprecedented in world history for a completely uncollateralized fiat currency. But should the dollar continue an extended decline, under pressure from unprecedentedly high trade deficits, there is every reason to believe that central banks will seek greater diversification in their reserves, most likely into euros. As central banks bailed out of gold in the 1990s, their herding out of dollars will accelerate the dollar's decline. 

If the Bush administration persists in projecting an image of insouciance over the dollar's long-term fate, this will undermine the currency's hard-earned role as the world's preeminent standard of value...."

http://www.cfr.org/publication/11422/why_deficits_matter_condensed_version.html

More of a layman's look at how it's beneficial.

WHEN DICK CHENEY SAID, "Deficits don't matter," economists took that as proof of the economic illiteracy of the Bush administration. But it turns out there is a case to be made that Cheney was onto something.

On the deepest level, the vice president was echoing, in slightly exaggerated form, an idea put forward a few years ago by Irving Kristol, the Godfather of the neoconservatives who have had such a wide-ranging effect on Bush administration policy. Kristol wrote then, and still believes, that "We should figure out what we want before we calculate what we can afford, not the reverse."

On the political level, treating deficits as a non-issue also proved a successful strategy. After all, despite the torrent of red ink that splashed across the national budgets during his first term, George W. Bush was reelected by a substantial margin. Among John Kerry's other failures was his attempt to saddle the president with the label "profligate."

Which brings us to the economic level. The deficits that Bush ran up in the years in which the country was teetering on the verge of a serious recession had the beneficial effect of righting the economy. In that sense, deficits not only didn't matter, but were a force for economic good.

But that was then, and this is now. The economy, growing at an annual rate of 3.5 percent to 4.0 percent, is hardly in need of further fiscal stimulus. Yet the budget that the president sent to Congress last week promises deficits as far ahead as the eye can see--if the eye is practiced in reading these massive documents.

http://www.weeklystandard.com/Content/Public/Articles/000/000/005/245esggv.asp

Quote from: TulsaMoon on December 14, 2010, 03:37:52 PM
GM received $49.9 billion of which they have repaid $361 million. GMAC received $13.5 billion of which zero has been repaid.

Automotive Industry Financing Program

General Motors     $49.9 Billion
(paid back)          $361 Million
Chrysler              $12.8 Billion
(paid back)          $280 Million
GMAC                 $13.4 Billion
Chrysler Financial $1.5 Billion
(paid back)         $1.5 Billion

But . . . if you are talking to sheeple, you can simply take money from your left pocket and put it in your right pocket and your debt is erased?  Right?

Explanation From Reason Magazine:

Whitacre publishes a column with the headline, "The GM Bailout: Paid Back in Full," most ordinary mortals unfamiliar with bailout minutia would assume that he is alluding to the entire $49.5 billion. That, however, is far from the case.

Because a loan of such a huge amount would have been politically controversial, the Obama administration handed GM only $6.7 billion as a pure loan. (It asked for only a 7 percent interest rate—a very sweet deal considering that GM bonds at that time were trading below junk level.) The vast bulk of the bailout money was transferred to GM through the purchase of 60.8 percent equity stake in the company—arguably an even worse deal for taxpayers than the loan, given that the equity position requires them to bear the risk of the investment without any guaranteed return. (The Canadian government likewise gave GM $1.4 billion as a pure loan, and another $8.1 billion for an 11.7 percent equity stake. The U.S. and Canadian government together own 72.5 percent of the company.)

But when Whitacre says GM has paid back the bailout money in full, he means not the entire $49.5 billion—the loan and the equity. In fact, he avoids all mention of that figure in his column. He means only the $6.7 billion loan amount.

But wait! Even that's not the full story given that GM, which has not yet broken even, much less turned a profit, can't pay even this puny amount from its own earnings.

So how is it paying it?

As it turns out, the Obama administration put $13.4 billion of the aid money as "working capital" in an escrow account when the company was in bankruptcy. The company is using this escrow money—government money—to pay back the government loan.

With the Eurozone in its present condition, there is no currency other than the dollar to diversify with. It's looking increasingly likely that the Germans will continue down the road of austerity and leave the rest of the Eurozone to rot, which can only end in either a shrinking Eurozone or devaluation of the Euro.

There are a lot of fairly smart people thinking that the Euro will be back to parity with the dollar before too long. In that context, deficits really don't matter, no matter how long they continue. The trade deficit certainly won't matter as long as dollars are in demand.

The problem comes in when people holding dollars don't think they'll get anything in return. Right now, they're too worried about the Euro to care.

Quote from: nathanm on December 14, 2010, 04:07:10 PM

The problem comes in when people holding dollars don't think they'll get anything in return. Right now, they're too worried about the Euro to care.

That's a valid point, but it won't stay in disarray forever.  What happens at the point the EU is stabilized and we are still issuing IOU's to pay our government employees though?

Seriously curious how the upset in the Euro is boding for globalists.

Quote from: Conan71 on December 14, 2010, 04:18:52 PM
That's a valid point, but it won't stay in disarray forever.  What happens at the point the EU is stabilized and we are still issuing IOU's to pay our government employees though?

Seeing as how the major Euro partners are doing everything in their power to make things worse, that point is a long way off. Germany continues to do what they (falsely) believe best for Germany and is screwing Greece, Ireland, Spain, and Italy in the process. Such is life in a monetary union without a corresponding political union.

As long as demand is poor here in the US, inflation isn't a concern, so dollar holders aren't affected by our issuing more dollars. If anything, we're not printing enough dollars at the moment (hence my continuing calls for further fiscal stimulus to get those dollars in the hands of people who will spend them).

Nate has been cartooned:

(http://www.tobytoons.com/td/files/toons/2010/20101214_taxes.jpg)

So what the rich are saying is that each of those poor people should pay an even BIGGER percentage of their pay as taxes to support the richest.  Keep the subsidies going.

Never mind that everyone under about $250,000 is getting nailed for 30 to 40% already.  Yeah, 16% is just WAY too much for the rich to pay.  After all, they deserve 'special' treatment.  After all, they ARE the only ones who can afford to "make" jobs.  But then, why aren't they??

And then there is the 'hidden' income taxes on everything they buy.  Every service they need.  Every lawyer they hire.  Every fiscal activity they engage in.

And if they can't make it on half what they make, well too bad.  They should have done something different with their lives - something more productive and contribute more to the overall societal effort - like be rich!

Quote from: guido911 on December 16, 2010, 04:06:33 PM
Nate has been cartooned:

Ah, more completely misleading statistics. The rich pay far less of a proportion of their income in sales and other use taxes. High income earners pay less payroll tax. But yeah, if you limit it to the one part of our tax system that's progressive, it looks pretty bad for rich folks. Not.

It's all in the script.  If they stay on script, they think no one will think and realize what a crock it is.

Quote from: heironymouspasparagus on December 16, 2010, 07:55:39 PM
It's all in the script.  If they stay on script, they think no one will think and realize what a crock it is.

Neither you nor Nate get it. The poor are bitching about the rich not paying enough?
Q:  Who in the hel! do they think they are?
A:  Just a bunch of damned ingrates.

Quote from: nathanm on December 16, 2010, 07:42:02 PM
The rich pay far less of a proportion of their income in sales and other use taxes.

That's a no-brainer.  If you only spend half your income, you are only paying sales/use tax on half your income.  8% of half your income is only 4% of your income.  The number of dollars paid in sales/use tax is probably still more than you or I will pay. (Unless you are a closet rich guy.)

Quote
High income earners pay less payroll tax.

As a percentage, yes.  If you pay 7.5% (or 15% if self employed) up to $100,000 (or whatever the limit is now) and then make a bunch more not subject to payroll tax, of course the percentage will be a smaller part of your total income.  Benefits (at least SS) will be based on your contribution.  You have still paid more dollars in payroll taxes than someone only making say $50,000. I still fear/expect a means test for benefits, meaning if you are rich..... you get no benefits for your contributions.  Where will that level start?  Save for retirement?  You will be screwed.

Someone making $250,000 and paying (overall) 40% will pay $100,000.

Someone making $10,000,000 will (supposedly pay)  $100,000 + (.16 x [$10,000,000 - $250,000]) = $1,660,000., or 16.6% of their gross $10 M. (That would be assuming they can't hide the first $250,000 in a lower bracket.) Even if they only pay a total of 16% of $10,000,000., that's still $1,600,000.

It is not too difficult to believe that all the fat cats paying ONLY 16% of their huge income could be paying a large percentage of the total tax dollars received by the states and feds.  Since I don't have the actual numbers, I'll leave it as a concept which, to me, is believable.

Whether or not the rich should pay 40% of their top dollar is a legitimate subject but to reject outright that they are paying a lot of dollars is wrong. 

Quote from: guido911 on December 16, 2010, 08:46:28 PM
Neither you nor Nate get it. The poor are bitching about the rich not paying enough?
Q:  Who in the hel! do they think they are?
A:  Just a bunch of damned ingrates.

I think it's interesting that you're so hell bent on making other people's problems your own yet constantly lambast liberals for doing the same.

Quote from: nathanm on December 16, 2010, 09:43:04 PM
I think it's interesting that you're so hell bent on making other people's problems your own yet constantly lambast liberals for doing the same.

Perhaps you have not paid 6 figures in federal income tax, which is probably more than you would earn in how many years? Perhaps your opinion would change if you did.

Quote from: guido911 on December 16, 2010, 09:47:37 PM
Perhaps you have not paid 6 figures in federal income tax, which is probably more than you would earn in how many years? Perhaps your opinion would change if you did.

Ah, so you are arguing your position because it's best for you, not because it's what's right for our country as a whole. Thanks for clearing that up. You've previously been so coy about your family's income that it wasn't clear if you were promoting what's best for you personally or if you really believed that tax cuts will actually help the economy and thus the the lot of those demographics that are seeing 15-25% unemployment, rather than your 6%.

Sorry that I got it wrong in my last post.

Quote from: nathanm on December 16, 2010, 10:03:15 PM
Ah, so you are arguing your position because it's best for you, not because it's what's right for our country as a whole. Thanks for clearing that up. You've previously been so coy about your family's income that it wasn't clear if you were promoting what's best for you personally or if you really believed that tax cuts will actually help the economy and thus the the lot of those demographics that are seeing 15-25% unemployment, rather than your 6%.

Sorry that I got it wrong in my last post.

It's right for our country that I pay more than you--without any extra benefit? Enjoy riding the gravy-train. Seriously, how do you get by knowing that your friends and neighbors pay more, much more, than you do just to live in this country? It's almost as if "Hey, I don't have to sacrifice or work hard. I can let someone else pay the bill."

Here is Nate's favorite commercial:

Quote from: nathanm on December 16, 2010, 09:43:04 PM
I think it's interesting that you're so hell bent on making other people's problems your own yet constantly lambast liberals for doing the same.

Are you saying that Guido is acting like a broke guy defending the rich?  I don't remember Guido ever saying he was living on minimum wage.

Quote from: nathanm on December 16, 2010, 10:03:15 PM
Ah, so you are arguing your position because it's best for you, not because it's what's right for our country as a whole.
Sorry that I got it wrong in my last post.

I think that anyone making more than $250,000 should give anything above that to the Federal Governent (100% marginal rate) because it's good for the country as a whole.  Really now, who needs more than that to live on.  Think of the $ the feds could get from folks like Warren Buffet, Bill Gates and so many more.  We might even be able to balance the budget.  Wow! What a concept.
\sarcasm

Edit:
Disclaimer: I don't make anywhere near $250,000. (I make a lot less than that for those of you tempted to ask if I make so much more than $250,000 that I am not near it.)

Guido:

While I think the rich (you) should pay more dollars, you should pay a similar percent on your top dollar as everyone else. 

However, you forget that as a rich person paying high taxes you get:

Better police protection
Better fire protection
Better acesss to good roads without paying tolls
Better snow removal (In Bixby?)
Better sewer service
Better tasting tap water
Better protection from foreign enemies
Better Federal protection of your investments (FDIC etc)
Free parking downtown
Special privileges on the waterways
Exclusive use of boat launching ramps at the Corps of Engineers controlled lakes
Free golf everywhere
.....

Oops, probably not quite true.

Rich not paying enough?  Right now the tax system is based on percentages.  I REALLY would love to hear what Guido thinks is a fair way to tax people?  Please....just outline a few of the details - a quick overview.

Bitching about the rich not paying enough?  Yeah, that might be about right, since our system IS currently based on percentages and methods to squirm out of paying those percentages.  Yes, I would like to see the class warfare being waged by the top 1% on the bottom 99% END.  (1% is also the badge that outlaw biker gangs use for showing their "pride".  Oh, crap, now I've gone and pissed of the bikers, too!)

I am a long ways from rich, but not in danger of losing the house (yet) either.  I would love to have lower taxes to pay.  I would be much more than thrilled if those "1%" would pay even half the overall rate that I pay.  As stated over and over and over, there would be no deficit, no debt, and no missed economic opportunities due to the unavailability of $14 trillion to the overall economy.  

That is a topic that hasn't been discussed much - think of what we could do in this country if that 14 trillion was not in debt, but floating around through the economy!!!  What a horrible disservice we have done to ourselves and our children!!

But our imperialist voyeurism HAS been kind of fun....

Quote from: heironymouspasparagus on December 17, 2010, 01:28:44 PM
Rich not paying enough?  Right now the tax system is based on percentages.  I REALLY would love to hear what Guido thinks is a fair way to tax people?  Please....just outline a few of the details - a quick overview.

Bitching about the rich not paying enough?  Yeah, that might be about right, since our system IS currently based on percentages and methods to squirm out of paying those percentages.  Yes, I would like to see the class warfare being waged by the top 1% on the bottom 99% END.  (1% is also the badge that outlaw biker gangs use for showing their "pride".  Oh, crap, now I've gone and pissed of the bikers, too!)

I am a long ways from rich, but not in danger of losing the house (yet) either.  I would love to have lower taxes to pay.  I would be much more than thrilled if those "1%" would pay even half the overall rate that I pay.  As stated over and over and over, there would be no deficit, no debt, and no missed economic opportunities due to the unavailability of $14 trillion to the overall economy.  

That is a topic that hasn't been discussed much - think of what we could do in this country if that 14 trillion was not in debt, but floating around through the economy!!!  What a horrible disservice we have done to ourselves and our children!!

But our imperialist voyeurism HAS been kind of fun....

Something along these lines is fair:

http://www.fairtax.org/site/PageServer

As for your bullsh!t assertion that the rich are engaging in class warfare, got a link for that? Because last I checked its the poor that is bitching the most. Did you forget to read the original post in this thread?

Quote from: heironymouspasparagus on December 17, 2010, 01:28:44 PM
That is a topic that hasn't been discussed much - think of what we could do in this country if that 14 trillion was not in debt, but floating around through the economy!!!

I believe it is already floating around in the economy without inefficient government assistance.  Funnel that money through the government and we will be lucky if it does half the good.  Rich people don't keep their money stuffed in a mattress or buried in jars in the back yard.  It's out making them more money which means it is available for other people to do things with. 

I see only a few basic things that are taxable and nobody likes any of them.

Income
Possessions, usually property but could be expanded to include YOUR saving account, wardrobe,  etc.
Spending, (Sales, VAT etc) we could expand "sales tax" to both the buyer and seller.
Life,  pay a tax for the  privilege of being allowed to live.
Death,  we already tax that in the estate taxes.
Activities, Use tax for boat ramps, golf fees, toll roads

Someone feel free to add to the list.

Simple question. Why should the rich pay a higher % in taxes? Break it down in facts, not just your opinion.

Quote from: TulsaMoon on December 17, 2010, 04:26:16 PM
Simple question. Why should the rich pay a higher % in taxes? Break it down in facts, not just your opinion.

Simple answer.  Because they cheated their way to success.

Quote from: guido911 on December 17, 2010, 04:38:13 PM
Simple answer.  Because they cheated their way to success.

Oh my, all Rich people in this country cheated their way to success... Well done Guido, you hit the FACT nail right on the head..

Quote from: guido911 on December 17, 2010, 04:38:13 PM
Simple answer.  Because they cheated their way to success.

Or how about . . ."They're members of the lucky sperm club."

That's my new favorite.

A better question would be, why do people who pay little or no taxes have any say in what other people pay?

The welfare state reduces a citizen to a client, subordinates them to a bureaucrat, and subjects them to rules that are anti-work, anti-family, anti-opportunity and anti-property … Humans forced to suffer under such anti-human rules naturally develop pathologies.  The first is to blame the successful for their poverty, the second is to demand that a larger welfare state is the only way to eliminate their poverty. 

Quote from: Gaspar on December 17, 2010, 04:52:00 PM
A better question would be, why do people who pay little or no taxes have any say in what other people pay?

In order to maintain that status of paying little or no tax, whichever tax is being talked about at the time.

Quote from: TulsaMoon on December 17, 2010, 04:26:16 PM
Simple question. Why should the rich pay a higher % in taxes? Break it down in facts, not just your opinion.

If you read the thread, you would know why. The marginal utility of the 400,000th dollar of income is less than the marginal utility of the 40,000th dollar. This is basic economics.

Gaspar, I wish I paid little or no tax. 40-50% of my family's income goes to paying various taxes, depending on the given year. I think it's telling that you and guido think that most anyone who argues in favor of progressive taxation must be some deadbeat freeloader sitting at home on welfare who doesn't pay a dime in taxes. I'm glad that the world I see outside is not as threatening as the one in your head.

Guido, I believe you're the one complaining about a change of about 1% of your income in tax.

Quote from: nathanm on December 17, 2010, 06:15:20 PM
If you read the thread, you would know why.  

microeconomics and macroeconomics?

I started the thread...... oh my I have continued to read it, silly me.

I do agree though.

Might I wish apon a cricket and plant my arse in a lazyboy and live off those that really work....

Question still.. Why should those that do give to those that don't. Simple... And once again, no real answer

Quote from: nathanm on December 17, 2010, 06:15:20 PM
If you read the thread, you would know why. The marginal utility of the 400,000th dollar of income is less than the marginal utility of the 40,000th dollar. This is basic economics.

At one time, it was basic science that the earth was flat and the sun (moon and stars) revolved around the earth.

Quote from: TulsaMoon on December 17, 2010, 11:13:50 PM
Question still.. Why should those that do give to those that don't. Simple... And once again, no real answer

You're making the common mistake of presuming that those who don't make a crap-ton of money do so because they're lazy or whatever. Some choose to do necessary jobs that don't pay well. Others just never have the opportunity to start a business or can't get a graduate degree because of life circumstances or whatever.

Still others are lazy clucks who manage to make a lot of money because of luck or family connections. And those who are lazy and refuse to work hard and are poor because of it.

And then there are the folks who work hard and sacrifice and make a lot of money. And those who work hard and sacrifice and never manage to make a lot of money. We like to believe that we live in a country where merit is the only thing that matters, but it doesn't work that way.

Take a common recent example of newly minted attorneys who find it nearly impossible to get a job in the current economy. You simply can't be a lazy moron and make it through law school, yet they don't manage to get hired because almost nobody is hiring attorneys right now.

Red Arrow, even the most radical free-marketeer economists believe in the concept of marginal utility.

Quote from: nathanm on December 18, 2010, 01:13:27 PM
You're making the common mistake of presuming that those who don't make a crap-ton of money do so because they're lazy or whatever. Some choose to do necessary jobs that don't pay well. Others just never have the opportunity to start a business or can't get a graduate degree because of life circumstances or whatever.

Still others are lazy clucks who manage to make a lot of money because of luck or family connections. And those who are lazy and refuse to work hard and are poor because of it.

And then there are the folks who work hard and sacrifice and make a lot of money. And those who work hard and sacrifice and never manage to make a lot of money. We like to believe that we live in a country where merit is the only thing that matters, but it doesn't work that way.

Take a common recent example of newly minted attorneys who find it nearly impossible to get a job in the current economy. You simply can't be a lazy moron and make it through law school, yet they don't manage to get hired because almost nobody is hiring attorneys right now.

Red Arrow, even the most radical free-marketeer economists believe in the concept of marginal utility.

Just answer Moon's question.

Quote from: nathanm on December 18, 2010, 01:13:27 PM
Red Arrow, even the most radical free-marketeer economists believe in the concept of marginal utility.

When I Googled "marginal utility" the concept that was presented first had to do with satisfaction.  I agree if you only make $10,000 that $1000 will be more significant to you than to someone making (the proverbial) $10,000,000.  However, someone making BIG bucks is also more likely to spend $100,000 than someone making $10,000.  If I get the time (to waste), I'll look into"marginal utility" to verify that people are using the term within the assumptions of the original concept.

The first option for most students that can't make it in engineering/science (physics, chemistry, math, geology...) school is usually to go to business/economics school, usually at the same university.  If they get through that, they will probably make more money than engineers, validating your statement that merit and hard work don't always pay.

Your example of unemployed lawyers reminds me of unemployed aerospace engineers driving taxis when I was in college.  Many of us decided not to specialize in aerospace. 

Quote from: guido911 on December 18, 2010, 01:25:17 PM
Just answer Moon's question.

The question was meaningless because he asked about "those that do" and "those that don't". It might have some meaning if he asked about "those who have" and "those who don't have," but then you get into value judgments, so it's again an impossible question to answer when the person who asked it has a different system of values and ethics than the person answering. Without a common frame of reference, any answer I give will not compute, so I try to stick to what's best for us all economically. We all share a common frame of reference in that we all agree that capitalism is the best system we've got.

In that context, leaving people behind deprives you of more money than you are deprived of by the government helping the destitute. More people actively in the economy improves said economy and makes us all richer. The most wealthy derive the most benefit from that, but even those of us who aren't as wealthy benefit.

Red Arrow, it's certainly best if people don't specialize in things that end up being useless, but when they're 5 or 6 years through 7 years of schooling, it's not yet clear that you're screwed after finishing the 7th, and you're $250,000 in debt, what do you expect them to do? It's unfortunate that our present system for financing higher education leads to misallocation of resources in that way, but it's what we've got.

Here's my position. If you are "poor", those folks that pay ZERO federal income tax yet get the exact same benefits from government as the "rich, you have no business bitching about anyone paying more in taxes. It's both sickening and galling.

Quote from: guido911 on December 18, 2010, 02:09:27 PM
Here's my position. If you are "poor", those folks that pay ZERO federal income tax yet get the exact same benefits from government as the "rich, you have no business bitching about anyone paying more in taxes. It's both sickening and galling.

Well, I hope I don't sicken and gall you, since I pay plenty of income tax. ;)

An even bigger reason the question is meaningless is because it presumes that in some strange, distorted Bizarro world, the rich actually pay more than most of us.  And the FACT that they pay about half overall has been discussed, demonstrated, illustrated and beat to death.  But knowing that would mean they would have to take their head out of that brown, brown world of Rupert and company.

And doesn't it seem just a "wee bit" disingenuous of Guido to demand an "answer" when so many of his aren't.  But they are misspelled profanity to "wink-wink" mask the fact.  Or just resulting to insults and name calling.

Quote from: heironymouspasparagus on December 20, 2010, 12:05:07 AM
An even bigger reason the question is meaningless is because it presumes that in some strange, distorted Bizarro world, the rich actually pay more than most of us.  And the FACT that they pay about half overall has been discussed, demonstrated, illustrated and beat to death.  But knowing that would mean they would have to take their head out of that brown, brown world of Rupert and company.
And doesn't it seem just a "wee bit" disingenuous of Guido to demand an "answer" when so many of his aren't.  But they are misspelled profanity to "wink-wink" mask the fact.  Or just resulting to insults and name calling.

I find it highly unlikely that the "rich" pay less dollars than I do.  It wouldn't surprise me that they pay less percentage than I do.

I have an old high school friend of mine that has made and lost tons of money, more than I will ever see in my lifetime for sure. He is now flat broke and lives in the house he grew up in and was handed down to him. He does nothing but sit in his lazyboy ( my earlier comment ) and collects money off the State. He refuses to get a job and or start a new company. He is by far not a stupid man and could regain his old life style and become productive once again. His answer is why should I?

I asked the % question because and due to him. He showed me his returns his accountant did years ago in which millions were paid in taxes. He showed me what he received last year from the government in the amount of thousands. His reply again is why? He has a house for free, receives what he terms as free money from the masses and does nothing to contribute now in his life.

Trying to have a conversation with someone that has been on the extremes of both sides has been a battle I have lost many times over with him.

Like most here on the forums I worked very hard to get to where I am today. Yes MANY people do cheat and lie to climb the ladder of the money tree. Most I dare say work hard to get there. I am an Engineer, I have specialized in cryogenics and work with superconducting magnets both in the medical and research field. I am by no means rich or even close to it, but I do carry the feelings of why?

I thank you all for your thoughts here and I will take some with me in my next sit down with him.

Quote from: TulsaMoon on December 20, 2010, 10:29:15 AM
I have an old high school friend of mine that has made and lost tons of money, more than I will ever see in my lifetime for sure. He is now flat broke and lives in the house he grew up in and was handed down to him. He does nothing but sit in his lazyboy ( my earlier comment ) and collects money off the State. He refuses to get a job and or start a new company. He is by far not a stupid man and could regain his old life style and become productive once again. His answer is why should I?

I asked the % question because and due to him. He showed me his returns his accountant did years ago in which millions were paid in taxes. He showed me what he received last year from the government in the amount of thousands. His reply again is why? He has a house for free, receives what he terms as free money from the masses and does nothing to contribute now in his life.

Trying to have a conversation with someone that has been on the extremes of both sides has been a battle I have lost many times over with him.

Like most here on the forums I worked very hard to get to where I am today. Yes MANY people do cheat and lie to climb the ladder of the money tree. Most I dare say work hard to get there. I am an Engineer, I have specialized in cryogenics and work with superconducting magnets both in the medical and research field. I am by no means rich or even close to it, but I do carry the feelings of why?

I thank you all for your thoughts here and I will take some with me in my next sit down with him.

It sounds like your friend is more depressed than making a conscious ideological or economic choice. Usually folks who've done what your friend has done have a drive that, all things being equal, keep them up and running in good and bad times.  If his drive is broken down that tells me he might be more in a mental hole than might be obvious at first blush.

Quote from: we vs us on December 20, 2010, 11:02:50 AM
It sounds like your friend is more depressed than making a conscious ideological or economic choice. Usually folks who've done what your friend has done have a drive that, all things being equal, keep them up and running in good and bad times.  If his drive is broken down that tells me he might be more in a mental hole than might be obvious at first blush.

Thats putting it mild for sure. He is a broken man and the drive that was in his eyes all his life is now gone.

It's all about the percentages.  Unless there is some psycho rationalization that everyone should pay a fixed number - say $50,000 per year.  Great for the rich guy.  Kinda puts the rest of us in a bind....

TulsaMoon,
Sounds like the friend has really lost his way in the weeds!  And no, not the smokin' kind!  Kind of like what we have done as a nation and society in the last 30 to 40 years.  To blatantly steal a phrase, we were the ones making Thunderbirds ("see" Bob Seger if the reference is too obscure).  WE were the ones who went to the moon.  Repeatedly.  We are the ones squandering the legacy of the greatest single group of people the history of the world has ever seen!

Here is something that always cheers me up when I get down in those kind of moods.

http://www.youtube.com/watch?v=InRDF_0lfHk&feature=fvw

And just to be sure to be the most Politically Incorrect (with capital letters!) on the board;

MERRY CHRISTMAS, One and All!!

And Happy New Year!!

Really!!