The honeymoon is ALREADY over? Shocking numbers

[droski]

No it isn't!

It's being taken from both of them, just at different rates.

If I'm making, lets say, 40k, and it's just barely enough to take care of my family, then taxing me at 15% and you at 20% isn't "giving me wealth" at all! At that salary I'd spend every penny I made on food and housing and utilities.

Where is this mysterious "redistribution of wealth" in that scenario?

You're just taking two things you disagree with and merging them into one thing.

i'm being taxed at a higher rate BECAUSE you are being taxed at a lower rate. is this really that hard to understand?

say we have a flat tax of 20%:

person A & B have 1,000 in income = $800 left over

progressive:

person A get's taxed at 30% = $700 left over

person B get's taxed at 10% = $900 left over

person A has less money than they did under a flat tax, person B has more money.

 

[StepCross]

the earned income tax credit.

1. Way off-topic. The EIC is sort of a form of handout, which is not what I'm talking about. I'm talking about progressive taxation in theory, not handouts, and not the actual US code (which is a mess).

2. Anyway I'm not positive, but I doubt 40k qualifies for the EIC. Don't you have to be broker than that to get that credit?

 

[droski]

No. No, no, no.

Progressive taxation does NOT lead to equality of outcome.

You call it a mathematical fact, so let's just do the math.

Person A makes 100k, and is taxed at 20%. That gives them 80k left to work with, free and clear.

Person B makes 50k, and is taxed at 15%. That gives him 42,500 left to work with, free and clear.

Equal outcomes?

Absolutely not...not even close.

agreed not equal outcomes:

one is paying 20K in taxes

teh other is paying 7,500

seems fair.

 

[StepCross]

i'm being taxed at a higher rate BECAUSE you are being taxed at a lower rate. is this really that hard to understand?

say we have a flat tax of 20%:

person A & B have 1,000 in income = $800 left over

progressive:

person A get's taxed at 30% = $700 left over

person B get's taxed at 10% = $900 left over

person A has less money than they did under a flat tax, person B has more money.

That doesn't make any sense. In a progressive system, if they both made 1000, they'd both get taxed at the same rate, by definition.

 

[StepCross]

agreed not equal outcomes:

one is paying 20K in taxes

teh other is paying 7,500

seems fair.

*facepalm*

 

[droski]

That doesn't make any sense. In a progressive system, if they both made 1000, they'd both get taxed at the same rate, by definition.

i assure you my next $1,000 earned is taxed at a far higher rate than the average american's next $1,000.

 

[MG1968]

1. Way off-topic. The EIC is sort of a form of handout, which is not what I'm talking about. I'm talking about progressive taxation in theory, not handouts, and not the actual US code (which is a mess).

2. Anyway I'm not positive, but I doubt 40k qualifies for the EIC. Don't you have to be broker than that to get that credit?

1. fair enough, but the Constitution does call for tax uniformity, not a sliding scale based on income.

2. a 40k/year salary most certainly would qualify for the EIC once deductions are made and a person's adjusted gross income is figured. Head of household with a wife and two kids is going to bring that 40k down to between 20 and 30k, which is well within EIC range.

 

[StepCross]

i assure you my next $1,000 earned is taxed at a far higher rate than the average american's next $1,000.

Sweet Moses.

Your FIRST 40,000 got taxed at EXACTLY the same rate as other dude's first 40,000.

It's only your second 40,000 where the rate went up.

You might as well say your wealth was redistributed from you to you, since your tax on your last 1000 was higher than your tax on your first 1000. That makes as much sense as calling progressive taxation "redistribution."

 

[droski]

Sweet Moses.

Your FIRST 40,000 got taxed at EXACTLY the same rate as other dude's first 40,000.

It's only your second 40,000 where the rate went up.

You might as well say your wealth was redistributed from you to you, since your tax on your last 1000 was higher than your tax on your first 1000. That makes as much sense as calling progressive taxation "redistribution."

you are a lost cause. when you start arguing the end dollar amount doesn't matter you are going into lunacy.

once again. i'm paying more because someone poorer is paying less. argue semantics all you like, but this is a textbook wealth redistribution.

 

[sjt18]

I forgot Jesus was a free marketer despite getting arrested for vandalizing the banks.

He didn't vandalize banks. Of course this wouldn't be the first time you had the facts, logic, and commons sense available to you and went the other direction.

FTR, he purged the money changers... not bankers. In a scheme Keynesians and liberals would absolutely LOVE, the Priests devised a scheme where only Temple money could be used to buy sacrifices. The money changers, many of them elites or employed by elites, charged extraordinary fees to convert the every day currency into temple currency.

PS - I reject your blind justice as it affects my rights. I wanted 20 / 20 vision justice.

You have no rights if justice is not blind... and don't be obtuse... you know exactly what that means. Oh wait, you live in a world where black is white and day is night. Maybe you don't understand the concepts of blind justice, rule of law, and equal protection under the law.

 

[sjt18]

No. No, no, no.

Progressive taxation does NOT lead to equality of outcome.

It attempts to equalize or diminish the difference between the real income of high earners and low earners. "Equalize"? That would be pretty difficult.

You call it a mathematical fact, so let's just do the math.

Person A makes 100k, and is taxed at 20%. That gives them 80k left to work with, free and clear.

Person B makes 50k, and is taxed at 15%. That gives him 42,500 left to work with, free and clear.

Equal outcomes?

Absolutely not...not even close.

Unequal treatment? Absolutely in the perfect sense. In your example, the second person "works" only half as hard but gets more than half as much benefit from the combined contribution of the two. That is NOT fair.

A more real world example though is someone earning say $200K in NY vs someone earning $50K. The person earning $50K is unlikely to pay anything at all if they have normal deductions. The person earning $200K would pay about 40% total between federal and state income taxes IIRC. One person who ostensibly made 4 times the contribution barely gets twice as much for their trouble.

 

[sjt18]

you are a lost cause. when you start arguing the end dollar amount doesn't matter you are going into lunacy.

once again. i'm paying more because someone poorer is paying less. argue semantics all you like, but this is a textbook wealth redistribution.

Yep. Keynes and liberal economics in general only work if you deny that mathematical equations yield objective, concrete results.

No wonder they tried to impose an education philosophy where 2+2 just might equal 5 depending on how the kid felt when you told them they were wrong.

 

[utgibbs]

He didn't vandalize banks. Of course this wouldn't be the first time you had the facts, logic, and commons sense available to you and went the other direction.

FTR, he purged the money changers... not bankers. In a scheme Keynesians and liberals would absolutely LOVE, the Priests devised a scheme where only Temple money could be used to buy sacrifices. The money changers, many of them elites or employed by elites, charged extraordinary fees to convert the every day currency into temple currency.



You have no rights if justice is not blind... and don't be obtuse... you know exactly what that means. Oh wait, you live in a world where black is white and day is night. Maybe you don't understand the concepts of blind justice, rule of law, and equal protection under the law.

I am AMAZED at what lengths of quibbling y'all will go to in order to RATIONALIZE your assumed values.

from the King James Version:

"And Jesus went into the temple of God, and cast out all them that sold and bought in the temple, and overthrew the tables of the moneychangers, and the seats of them that sold doves"

And, by the way, these moneychangers were simply playing the game of fiat currency! How could they not be charging the market price???? In other words, they were perfect neoliberals.

Jesus, however, didn't approve.

 

[StepCross]

In your example, the second person "works" only half as hard but gets more than half as much benefit from the combined contribution of the two.

You're not making any sense. First of all, why do you say one person works harder? Hard work doesn't imply a better salary, and better salary doesn't imply harder work.

Second, the "benefit" they both get from paying taxes, AGAIN, is a free, protected society, with reasonable infrastructure, that lets them work and earn and save and make choices that either lead to wealth, or don't.

The guy making more money has obviously gotten MORE financial benefit from his free society than the other guy.

This is obvious, and would be obvious to everyone if people didn't get so tangled up in emotional stuff that just isn't true.

(like, PROGRESSIVE TAXATION MEANS UR TRYING TO STEAL MY MONEY AND GIVE IT TO DEADBEATS!!!11!!! OMG GIV IT BACK!!@)

 

[droski]

Hard work doesn't imply a better salary, and better salary doesn't imply harder work.

no but a higher salary does imply you are worth more to your employer and that is due to a combination of smarts and hard work.

 

[StepCross]

no but a higher salary does imply you are worth more to your employer and that is due to a combination of smarts and hard work.

Or something else, like an ability to sing, or to hit a nail with a hammer.

Who knows what it's due to.

But certainly you can't look at two salaries and conclude, as the other poster did, that the higher salary guy "worked twice as hard."

 

[sjt18]

You're not making any sense. First of all, why do you say one person works harder? Hard work doesn't imply a better salary, and better salary doesn't imply harder work.

That's the reason for the quotation marks. "Works" = smarter, harder, wiser, etc. It relates to effort, ability, and the wisdom of decisions.

It makes perfect sense. Imagine that you and I both operate hardware stores. Yours is a little bigger. You do a better job of merchandising. You inherited yours while I had to finance mine. You do a better job of marketing and appearance than I do. At the end of the year, we compare our books and you make both more gross profit AND a higher percentage.

According to the progressive logic that you are attempting to defend, you should pay a higher tax rate simply because you are better at what you do or God forbid a family member built something so that you could inherit it out of love.

I wholly and completely reject that both on economic and moral principle.

Second, the "benefit" they both get from paying taxes, AGAIN, is a free, protected society, with reasonable infrastructure, that lets them work and earn and save and make choices that either lead to wealth, or don't.

AND AGAIN, a progressive income tax is neither necessary NOR the best way for raising the revenue to do that... nor is it the most fair way.

The guy making more money has obviously gotten MORE financial benefit from his free society than the other guy.

No. He hasn't. He has mostly just made more of the benefits and opportunities made available to him.

This is obvious, and would be obvious to everyone if people didn't get so tangled up in emotional stuff that just isn't true.

Emotional stuff? I'm not the one trying to arbtrarily dictate that those who through honest effort do better should be punished for it... because it isn't "fair" to someone who doesn't do as well.

Your position isn't objective. There is NO objective reason to do it your way. It is in fact a failure to treat people equally under the law. You have made what amounts to an emotional decision about what is "fair".

You somehow think it is your "right" to level the playing field. To play god and mitigate the outcomes because you feel the results weren't equitable.

Sorry but I reject that idea... and more importantly, natural law (history + experience) has demonstrated it to be the wrong answer.

(like, PROGRESSIVE TAXATION MEANS UR TRYING TO STEAL MY MONEY AND GIVE IT TO DEADBEATS!!!11!!! OMG GIV IT BACK!!@)

Two related but not dependent issues have been conflated here. I think you agreed that deadbeats should get tough love... can we just drop that part now?

 

[droski]

Or something else, like an ability to sing, or to hit a nail with a hammer.

Who knows what it's due to.

But certainly you can't look at two salaries and conclude, as the other poster did, that the higher salary guy "worked twice as hard."

some people's hard work are worth more than others. and it's not luck

 

[StepCross]

It makes perfect sense. Imagine that you and I both operate hardware stores. Yours is a little bigger. You do a better job of merchandising. You inherited yours while I had to finance mine. You do a better job of marketing and appearance than I do. At the end of the year, we compare our books and you make both more gross profit AND a higher percentage.

According to the progressive logic that you are attempting to defend, you should pay a higher tax rate simply because you are better at what you do or God forbid a family member built something so that you could inherit it out of love.

Not really.

In fact, the two hardware store owners would pay the exact same rate on the first 100k they made. Then if one topped out there, he's done. If the other guy makes more, then his rate on the "more" goes up.

No. He hasn't. He has mostly just made more of the benefits and opportunities made available to him.

That's the point.

An idiot loser is going to have a bad life in any system.

But a talented, wise person will have a great life in a free society, and a terrible life in an oppressive, starving society.

Just look at the research posted in the education thread...in poor families, environmental factors basically end up controlling the educational prospects of the kids. Things are so bad that the kids' natural ability can't come out--they're screwed no matter what.

But in middle-to-wealthy families, environment basically stops mattering, and natural ability takes over.

This is the whole point: the successful, beyond a doubt, benefit more from a free society because they're just better at life. To say they're not getting any benefit is so far wrong it's almost comical!

 

[StepCross]

Emotional stuff? I'm not the one trying to arbtrarily dictate that those who through honest effort do better should be punished for it... because it isn't "fair" to someone who doesn't do as well.

There is, but you won't like it.

The thinking is, first of all we all hate taxes. We hate paying them, and unless we're crooks we don't love asking others to pay them either. They're a necessary evil.

Second, if possible we want taxes to do the most good while being the least disruptive. If a tax takes food out of a starving baby's mouth, then that's probably a stupid tax and that government would do better to disband than to tax anyone.

I assume you'd agree with both of those. Here's the part you won't like: since taxes shouldn't disrupt, they should be taken from DISCRETIONAL monies where possible. At the extremes, it's obvious: if you're not making much, you're gonna need all of it to just eat, and asking for taxes is probably pointless.

What's arbitrary and pointless is to just exempt the first X dollars, and then tax flatly. Because X would be arbitrary, and inflation would make it necessary to change X all the time, making the whole thing pointless.

Better to say:

-Everyone pays 0% on the first dollar they make
-Everyone pays 1% on the 20th dollar they make (or whatever)
-Everyone pays 2% on....

etc., you get the idea.

It's the simplest, fairest way to run a country by means of taking discretionary money, insofar as is possible, and not LIVING expenses.

Of course, "fair" isn't objective, as any parent will tell you when BOTH their kids think they're being treated unfairly at the expense of the other.

It is in fact a failure to treat people equally under the law. You have made what amounts to an emotional decision about what is "fair".

Not emotional. It's objective, we just don't agree on the details.

You somehow think it is your "right" to level the playing field. To play god and mitigate the outcomes because you feel the results weren't equitable.

I don't want to level the playing field at all. I don't think I had explained my reasoning very well for progressive rates until this post. Perhaps it will help.

(as an aside, this is why I like debating controversial issues...because it forces you to either improve your own arguments, or discard them. I'm positive I just improved my argument about progressive taxation, and if I'm doing any good maybe somewhere in this thread I've made you improve your argument against it)

Two related but not dependent issues have been conflated here. I think you agreed that deadbeats should get tough love... can we just drop that part now?

No problem. Can we also agree to drop the bit about equal outcomes, which also keep getting conflated into this debate?

 

[sjt18]

There is, but you won't like it.

The thinking is, first of all we all hate taxes. We hate paying them, and unless we're crooks we don't love asking others to pay them either. They're a necessary evil.

Nope. I like roads enough to pay for them. I like having the protection of a strong military. I like having laws and people to enforce them. I like having rules that assure that businesses do operate in a fair environment.

I don't "hate" taxes. I hate unnecessary taxes that go to pay for illegitimate and wasteful programs. And... I hate unfair, freedom destroying taxes as in the income tax generally and the progressive income tax specifically.

Second, if possible we want taxes to do the most good while being the least disruptive. If a tax takes food out of a starving baby's mouth, then that's probably a stupid tax and that government would do better to disband than to tax anyone.

Any direct tax has the potential of taking "food out of a starving baby's mouth" either directly or indirectly because some "rich" person couldn't hire someone or had to raise their prices.

I assume you'd agree with both of those. Here's the part you won't like: since taxes shouldn't disrupt, they should be taken from DISCRETIONAL monies where possible.

That is not your prerogative to decide. It isn't even your prerogative to decide what is discretional... you are making a moral judgment for someone over wealth that doesn't belong to you.

At the extremes, it's obvious: if you're not making much, you're gonna need all of it to just eat, and asking for taxes is probably pointless.

An indirect consumption tax does not tax anyone in particular. The market will still find its equillibrium. The "Fair Tax" would effectively tax the economy... not individuals. It would just be collected at points.

Better to say:

-Everyone pays 0% on the first dollar they make
-Everyone pays 1% on the 20th dollar they make (or whatever)
-Everyone pays 2% on....

etc., you get the idea.

No. That is the same as you walking into the quick stop to pay for gas and the cashier saying, "You have to pay $.10 more than the last guy... because you can afford it."

It's the simplest, fairest way to run a country by means of taking discretionary money, insofar as is possible, and not LIVING expenses.

The income tax is not simple, fair or efficient. The IRS help site even tells you there's something like 50,000 deductions available.

The income tax is by far and away more a means of control and social engineering than a good source of revenue.

Of course, "fair" isn't objective, as any parent will tell you when BOTH their kids think they're being treated unfairly at the expense of the other.

Oh no. "Fair" IS objective. If you are allowed to drive 55 mph... it is fair that I be allowed to drive 55 too. If you pay $25 for a driver's license then I should too. Again, I am completely against all forms of the income tax however if you insist on having one... if you pay 10% then I should too. It is none of your or the gov't's business how much I make.

I don't want to level the playing field at all. I don't think I had explained my reasoning very well for progressive rates until this post. Perhaps it will help.

You have simply restated our objections with different terms.

No problem. Can we also agree to drop the bit about equal outcomes, which also keep getting conflated into this debate?

Not completely. I don't think the progressive tax could ever actually achieve equal outcomes without killing the golden goose... it has managed to keep the goose weak and less productive than it should be by blood letting.

The progressive income tax attempts to tax those who produce more wealth more than those who produce less precisely according to you because they can afford it... not because doing so will help the economy or even the person who produces less.

 

[droski]

Better to say:

-Everyone pays 0% on the first dollar they make
-Everyone pays 1% on the 20th dollar they make (or whatever)
-Everyone pays 2% on....

etc., you get the idea.

It's the simplest, fairest way to run a country by means of taking discretionary money, insofar as is possible, and not LIVING expenses.

it's fair no matter what that % is?

 

[StepCross]

Any direct tax has the potential of taking "food out of a starving baby's mouth" either directly or indirectly because some "rich" person couldn't hire someone or had to raise their prices.

We can't control that indirect stuff, but surely we'd prefer not to DIRECTLY take food out of people's mouths, right? I mean, in that case, what's the point? We want better society, not worse.

That is not your prerogative to decide.

Nor yours.

It isn't even your prerogative to decide what is discretional... you are making a moral judgment for someone over wealth that doesn't belong to you.

No. I'm making a PRACTICAL judgment. It's impractical to directly tax our own citizens at a rate that makes it impossible for them to (say) eat. That would be stupid, and would make life worse for even successful people like you and me, because it puts a higher burden of things like homelessness and starvation and crime on all of us.

An indirect consumption tax does not tax anyone in particular.

It definitely does. It taxes people who buy things. Lower-middle class people buy only necessities, so they're getting slammed on taxes.

The more wealthy can save boocoodles, and thereby escape most of the taxes.

That doesn't sound either fair or practical to me.

The income tax is not simple, fair or efficient. The IRS help site even tells you there's something like 50,000 deductions available.

The income tax is by far and away more a means of control and social engineering than a good source of revenue.

All true. The US income tax is terrible. It's confusing and opaque. It's basically a way for politicians to yank us around.

I'm not defending the current code, I'm arguing theoretical tax here.

Oh no. "Fair" IS objective.

It isn't. It's a matter of perspective.

Maybe, in some cases, there's an absolute "Fair" that exists in a perfect world. But who's to decide it? God Himself isn't going to come down and tell us what the fair amount to be taxed is.

You could say, "Fair is everyone pays the same percentage of what they make."

Or "Fair is everyone pays the same amount, period."

Or "Fair is everyone pays the same percentage of the first 40k, this percentage of the next 10k, ..."

All say "everyone pays the same," and then give further explanation. But they're all different.

The progressive income tax attempts to tax those who produce more wealth more than those who produce less precisely according to you because they can afford it... not because doing so will help the economy or even the person who produces less.

We're not taxing people to "help the person who produces less," or to "help the economy."

We're just taxing people to collect enough money to run a country.

 

[StepCross]

it's fair no matter what that % is?

If the % is 100, that would be fair, I suppose, but stupid. Then no one would have anything...bad plan, no?

My dad (a deeply religious man) used to tell me that "fair" would be everyone dies for their sins, because we all sin.

I guess 0% across the board would also be fair but stupid, because then we wouldn't have a country.

I guess you could say it's fair no matter the percentages, but some make a lot more sense than others. We want it to be both fair and practical.

 

[droski]

No. I'm making a PRACTICAL judgment. It's impractical to directly tax our own citizens at a rate that makes it impossible for them to (say) eat. .

with 47% of the country not paying taxes i'd argue that the "we wont eat if we pay taxes" group is a pretty small minority of people getting a free ride.