What Tax Break.

[wondo]

Why should someone who works to achieve have to pay so much more than someone who sits on their ass

Dr. Freeze. I guess your string of 3 replies was geared towards me.

If you re-read your original post you will find exactly what I was referring to. From my understanding of your first post, you seemed to say that the opposite of those who 'achieve,' in this case, our discussion was that of financial achievement, would be those that sit on their ass. I took exception to this by saying I do not achieve a great financial benefit, but at the same time I do not sit on my ass. Therefore, I felt your logic, or at the very least, your statement was flawed.

In your subsequent posts, you seem to question what you perceive as an antagonistic view of the rich, and a dissatisfaction with my job. I have neither, and am not sure how you came to that conclusion by reading my response. I pay people millions of dollars and am happy when they receive that. I have had my opportunity to make that kind of money and was unsuccessful, but not for lack of effort. I have nothing to be bitter about as they have more talent than me.

I applaud you for your time spent working shit jobs. I have nothing against shit jobs or those people that work them. I don't consider myself in a shit job by any stretch of the imagination. In fact it is one of the ironically high demand jobs that does not pay well because it is in high demand, so people accept less money for it.

Dr Freeze, it was not a personal attack, but I wantedto point out that you made a way over generalization. What about artists who work tirelessly for years before seeing a profit? Are they lazy? Not in my opinion. Anyway, that is the last comment I have on that issue with you.

As for the tax issues, I don't see why it turns into a liberal/conservative battle. I would think that most intelligent people would want any law or plan that best served their individual needs. I myself, choose to support tax laws that would most help my tax bracket. That seems to be only common sense.

Edit: Dr. Freeze, you madea 4th reply as I wrote this, which I hadn't read. You clarified your position on the money/work/achievement. We seem to be in agreement. The first posts by myself and yourself seem to be a mere misunderstanding or miscommunication. GL

 

[taoist]

Re: Tax Soluition

Re: Tax Soluition

Burn the Tax code. It is too complex and it takes too much money to regulate it. <P>
A flat rate on <U>all income</U> is the only way. Let's make up a #. 10% to make the math easy. That way the poor who make only 20K a year will only pay 2K a year and the rich 100K will pay 10k a year. The rich are paying 5 times more than the poor. That's fair and just. That's America.

I was going to stay out of this argument, but I knew someone would bring up the "flat tax" and I have to set the record straight.... There's no way in hell that a flat tax will ever be implemented, nor would it ever work in a million years.

First of all, as mentioned above, approximately 5% of the wealthiest people in this country pay 95% of all income tax revenue.... If those people go from paying almost 1/2 of their income to 10% of their income, where in the world will we make up the difference? It obviously won't be from the lowest income brackets because, as was also mentioned above, they don't have very much income to pay taxes on in the first place...which means that the majority of the tax burden would be placed right where none of us wants it...smack dab on the back of the middle class!!!

Secondly, if we enact a flat tax, there would be no more earned income tax credit or mortgage deduction or any other deduction because those are all products of a graduated tax system and a flat tax would not contain those things...otherwise it is not truly a "flat tax."

You simply cannot tax those people in this country who already live in poverty...that's just not ever going to happen. So, if you take those folks out and reduce the top 5% of this country to 10% instead of almost 50%, then the flat tax would slam middle America.... We would pay something like a 30-40% flat tax, instead of the 10% that you suggested. A flat tax only benefits the upper 5% of wage earners and would be an increase to everyone else. Why do you think that was a major platform of Forbes? He would be one of the few people in this counrty that would benefit from a flat tax....

Sorry to go on a rant and nothing against you personally, Blazer, but a flat tax is not only one of the worst alternatives out there as far as a tax structure goes, but it will never be implemented unless the voters are uninformed and/or asleep at the wheel during the election....

Do I have all of the answers? No.

Do I know a bullchit tax proposal when I see one? ...well, you do the math.

 

[Private Petey]

The best idea is a national sales tax and get rid of income tax. I'd say 25-35% should do it. That would solve this problem once and for all!

PP

 

[dr. freeze]

no a flat tax does not benefit the wealthy.....everyone pays the same rate....

a tax that would benefit the wealthy is if a guy who made 1 Mill had to pay 10$ in taxes while a guy who made 10 K woudl pay 100$ in taxes....

a guy who made 1 Mill would pay 10K at 10%
a guy who made 10K would pay 100 at 10%

that flat tax still appears to benefit the poor -- they pay less for their roads, health care, SS, etc....

flat taxes still benefit the poor.....end of story.....

 

[taoist]

Re: Tax Soluition

Re: Tax Soluition

...opps, double posted by accident.

 

[wondo]

So what system would you suggest?

So far the flat tax is unfair, the current system is unfair..... what is a fair solution? Buy your own autobahn and charge tolls for use?

 

[dr. freeze]

wondo -- i presumed wrong on some of your points....but i believe so did you...

there are some people who sit on their ass -- that does NOT insinuate that all people who make little sit on their ass.....

the artist CHOSE to do what he does and CHOSE to make little....he COULD go and choose another vocation with better chances of success....

the artist is not what drives this country....nor is it the poor people....nor is it the minimum wage earners nor the laborers....

the INNOVATORS drive this country....they put things on the shelves....when things get put on the shelves, that creates INCENTIVE for productivity....when people get incentive, they are productive....then they work, dream -- become innovators themselves, and the cycle continues......

that is what drives this country....

 

[dr. freeze]

i think a flat tax is fairER....let the people who are rich pay a more according to what they earn.....incentive is still there to earn more because the rate at which it will be taxed will not change....

that would also take the burden off the poor.....so that not every man would pay the same amount dollar wise.....

but the way it is today -- good grief -- 50% is an outrage!!!

 

[taoist]

Dr. Freeze, please refer to my post above regarding a flat tax.... There's no way that would ever be a viable tax system.... Just wouldn't ever work!!!

It "would" benefit the rich by lowering their existing tax rate from approximately 50% to something less...how is that not a benefit?

Also, how does a flat tax "take the burden off the poor"? With all of the deduction and tax credits currently in place, the so-called poor in this country get 110% of their taxes back in the form of refunds....

...and if you were going to enact a flat tax, let me ask you a few questions....

...would you exempt those that are currently living below the poverty line?

...would you be mad if they did away with the current earned income tax credit or the mortgage deduction?

 

[dr. freeze]

my reference was to a "fair tax" where everyone pays the same amount -- just like everyone pays 99cents at the Burger King value menu....

using the current structure to compare anything is useless because of its absurdity....

i think a flat tax with a poverty line is realistic.....and yes eliminate all the other intricacies of today's system.....throw it down the toilet

 

[taoist]

First of all if you start exempting anyone from the "flat tax" system such as those that live below the poverty line then you don't have a "flat tax" and you simply change the argument to where do we draw the exemption line.... A "true" flat tax taxes everyone, including little johnny that mows lawns all summer for a little extra cash. Now who wants to be the one to tell little johnny that he owes uncle sam 20% of his yard mowing money?

Secondly, the mortgage deduction was enacted to help spur home buying.... If you take that away from the middle class, they have less incentive to buy homes....

I stand by my argument that a "flat tax" (or a "fair tax" if that's what you want to call it) only benefits the wealthiest of tax payers in this country. The majority of the tax burden would fall on the middle class.... If 5% of the people pay 95% of the taxes and you reduce the taxes that they pay (and exempt the folks below the poverty line), then who's going to make up the difference? The middle class.... Now, if you plan to be one of the top 5% of the wage earners in this country, then you should support a flat tax; however, if you don't attain that level of income, then a flat tax would do nothing but increase the amount of taxes you pay.

 

[dr. freeze]

no no no....

if you reduce the amount that the upper class pays -- more money is spent, more jobs are created, and the middle class makes more money.....then there is more $$ for revenue

economics isn't a zero sum game....not at all...

who really cares about the terms of a "flat tax"....but there probably should be a poverty line at about 10K or something like that....i don't know....but the tax rate should be the same for everyone

 

[ctownguy]

Once again Freeze is on the right track, Taoist, you have def been brainwashed.

To use the the fact of having an exemption of lower pay classes would be unfair so the the Flat tax is just as bad as what we have is ridiculous.

Any tax code is going to be unfair, so you strive for the fairest and any Flat tax that would have a minimum level to start paying is THE ONLY FAIR WAY TO DO IT.

Your idea that we would be bringing in less money could be true even though I think like freeze that it would spur more productivity and hence more tax revenue, but even if it did bring in less, then the GOVT NEEDS TO SPEND LESS, JUST LIKE WE HAVE TO BUDGET THEY MUST DO IT TOO AND THERE IS NOT A LIBERAL IN THIS COUNTRY THAT KNOWS HOW TO CUT SPENDING EXCEPT WHEN IT COMES TO DEFENSE

A flat tax would work if implemented with common sense, yea that will happen in govt, any tax system could work with common sense.

A nat'l sales tax would be better than what we have now, this current tax code is ludicrious and it is the liberals work of art and they love it so:moon:

 

[taoist]

Freeze, I do respect your opinion, but I fear that we may have to agree to disagree on this one.... I was a finance major with a minor in economics while in college and am currently enrolled in a federal tax class in law school.... I'm not trying to impress you by telling you that, but simply saying that according all that I have studied regarding our tax system leads me to believe that a flat tax structure just wouldn't support our federal government without drastically increasing the tax burden on the middle class....

I'm not a big believer in the "trickle down" theory, but we can save that argument for another day.... I wouldn't classify myself as a liberal or a conservative...probably more of a libertarian, as in my humble opinion, the only thing the Federal Government should collect taxes for is infrastructure and national defense and the states should be allowed to set their own laws and collect their own taxes regarding anything else. Essentiall, I'm sick and tired of our federal government setting the social policies in this country...that's something that should be decided on a state by state level, but I digress....

Well, I wanted to go through an example of why the flat tax just doesn't work, but I accidently erased it while trying to post and I'm about to leave to go to moot court, so I'll have to save that for another time.... Like I said, we may just have to agree to disagree on this matter. I'll try to get back here and post my example in the next few days.

 

[dr. freeze]

i agree with you on the defense and transportation issue....that is about all i care for the national gov't myself.....

i am a big believer in the trickle down effect however....

oh well....i have had enough of this topic myself...

 

[djv]

We are getting closer to the solution. Trickel down by it's self does not work perfect. In fact maybe 50% of the time. Not bad guys were all players here and know if you can get to over 52% you may be a winner. As for myself I did not wait for trickle down I made by own river and swam in it.

I see job's get mention a lot above. That was most inportant part of the discussion. We need then here not sent to other countries. That is trickel down gone bad. Theres to much of that. Let the upper 4 or 5% what ever. That run most the huge compines. Find the right way to hold and grow jobs here in the USA. Then lets give some tax breaks for doing it. No tax breaks for jobs sent out of the country. Simple help the USA or get no tax break. Hey they hold the power these folks and have the money they can dam well get creative. We keep counting on tons of small business to save out butts. They cant do it alone.

 

[dr. freeze]

i agree djv.....and right now jobs are going down the toilet....employers can't afford to pay anything anymroe -- look at KMart....who wouldda thought that store would ever go out of business? i have never been to a KMart without standing in line for 5 minutes waiting to get checked out.....

the people are overtaxed and can't pay anything....it doesn't pay to achieve anymore....

and thats the attitude people need to have....make your own river and swim up it....the pioneer or american spirit....live on self sufficiency.....screw the system....beat it.....but the system has to reward you when you beat it...or no one will try....and when you DO beat it, everyone wins.....because it is the PROCESS that generates wealth -- you are productive when you swim up that river....and your production benefits someone else directly and everyone indirectly

dont see why liberals can't get that into their thick skulls....more and more i think they would rather keep people down to get their votes

 

[Mickey's Picks]

ctownguy is dead on and shares a point of view I have long held. The government needs to spend less and be more efficient. The tax and spenders approach this thing ass backwards. Any government or any business or any individual plays by the same rules when it comes to accounting. Deficits arise when you spend more than you make. Read that again. It's pretty simple stuff. When you are in a deficit position the answer is to cut expenses. Businesses and individuals do this. Only governments take the opposite and wrong approach by instead raising taxes (income per se). They do this because they can and we as a people let them get away with it. Individuals and businesses can't merely open the income tap and cover their overspending. They have to cut back on expenses.

I am sick of paying taxes only to watch my money used wrongly, wastefully and excessively. There should be a maximum tax rate of X% (and my number is nowhere close to Bush's goal of 33%). The man is talking about lowering taxes that all people have to pay and I can't for the life of me understand why the whole world doesn't rally around him on this issue. Who gives a chit if some get more than others. Fact is he is offering everyone lower rates and everyone should be on board with that. I just don't get it.

 

[taoist]

...i don't disagree that the federal government spends way too much of "our" money, but let's have a little federal income tax history lesson here....

Prior to the beginning of the 20th century, most people were engaged in farming and most of what the government did was to provide national security and they only really needed large sums of money when we were at war.... Hence, the first income tax was passed to finance the Civil War.

Most of the tax revenue that was generated prior to 1913 was generated from tariffs ? charged for money for transactions typically when goods crossed jurisdictional boundaries, for example. That was the primary way we financed the government.... We didn?t really need a lot of money to finance the government because most of what the government did was provide for national defense, which in my opinion is one of the few things that government should have its hands in today. Farmers out in the middle of the country didn?t have a whole lot of need for government services; however, the economy today is entirely different. We have SSI, homeland security, airports, FAA control, welfare...all of which is provided by the federal government. We have scientific research, space programs...just think of all of the things, some of which are not necessary, that is funded primarily, if not completely, by our federal government. In order to raise that much money, you had to have a lot of tax. So the question is, who do you tax, how do you tax them, when do you tax them...that's what we're talking about, right? And we?ve chosen primarily to use the income tax in order to raise the revenue to do all of those services...and there are some historical reasons why we?ve chosen the income tax.

One of the principal historical reasons or policies that underlie the income tax is the same theory Willie Sutton had when they asked him why he robbed the bank.... Sutton said, "Hell, that?s where the money is!!!" You?ve got to tax some place where people have the money and can pay.... Hence, 7.5% of the returns filed (the most wealthy amongst us) constitute 62% (not the 95% I suggested earlier, but still a substantial amount of the total for only 7.5% of the people) of the total revenue collected...yes, I looked it up from year 2000. Now, on one end you could say that indicates a substantial progressivity in the tax code. But if you look at the rate structure, it is less progressive than it has been for a long time.... It was much more progressive back in the 50?s, 60?, 70?s, even in the 80?s, although this lack of progressivity began in the early 80?s and accelerated in the middle 80?s with the enactment of the 1986 Tax Reform Act where we had the top rate of tax constantly coming down.... The other thing that happened at the same time that the top rate of the tax was coming down...the tax base was shrinking!!! ...today we see that those who report the largest amount of income (the 7.5% of the population that report income over $100,000) and pay most of the tax (62% of the total revenues collected) are actually paying a lower portion of their total income in tax than they did 10, 20 or 30 years ago!!!! Hence, "the rich really are getting richer...." Not only do they have higher income, those folks in say the top 10% of the earners not only have much higher income than they did 10, 20 or 30 years ago, but they pay a much smaller proportion of it in tax!!! Yet, they still pay the majority of the taxes collected.... What that is telling you is they make so much more that they can pay less as a proportion of their total income and still end up paying most of the tax that is used to finance our federal government. So the disparity in income between the lowest income earners and highest income earners has been growing...and growing...and growing over the half century. The high income earners have been paying more total dollars in taxes, but a lower percentage of their total earnings in taxes.... Is that good or bad or right or wrong? That?s for you to decide....

 

[taoist]

...a little more history....

...a little more history....

The tax rates have bounced around substantially and I am tremendously entertained by the ravaging debate over whether to make the tax cuts that were enacted a few years ago permanent.... What?s permanent when it comes to the tax law? The maximum tax rate in 1921 was 73%!!! By 1925, it had been reduced with the lobbying efforts of the Secretary of Treasury to 25%. So from 1921 to 1925 it goes from 73% to 25%. Now you?d think with that tremendous reduction in tax rates we would have tremendous boon in the economy because "everybody knows if you cut taxes, you encourage growth and economic production and all that good stuff" so you end up with economic improvement. We did have pretty good economic times between 1912 and 1925 notwithstanding the fact that the rates up until 1925 were 73% and then we had pretty good economic times from 1925 until about three or four years later, at which point the tax rates were 25%. So after having had a 50 point reduction in the tax rates for four years, all of a sudden, the next thing you know, we end up with the Great Depression. In 1932, we had terrible budget deficits because incomes had declined substantially. The tax rates were already only 25% so the government was way behind in paying its bills. So we actually increased the tax rates in 1932 and most economists agree that that probably prolonged the Depression. What we needed was more deficit spending!!! We ended up with deficit spending and eventually got out of the Depression, but arguably we could have gotten out sooner had we lowered taxes even more...who knows?

What WWII did was to initially increase the deficits tremendously and you know what the tax rate went to during WWII? 94%!!! Because you had to fund the war effort.... Now if increasing taxes diminishes economic productivity, then I guess we should have been totally shocked when the maximum tax rate went to 94% so maybe it only diminishes productivity if you don?t have a good war going on.... In order to assure that even though you?ve got a 94% maximum tax rate, you?ve still got to keep some deficits to keep the economy pumped up. The question is how long can you go with deficit spending and keeping the economy pumped up and the answer is...a pretty damn long time. The budget was balanced but the federal expenditures exceeded revenues during the Clinton administration in 1992? (I think...) We didn?t have surpluses until about 1996? (I want to say 1996, but maybe even later than that, but at least 1996.) We had surpluses...if you go backwards from whenever that was, the last time we had a budget surplus prior to that was 1969. So we went almost 30 years with budget deficits.

Tax policy has been used as an engine of economic grown by virtually every presidential administration and every political party. Roosevelt started in 1934 when he accelerated the appreciation for equipment to encourage investment in capital production. Eisenhower did the same thing in 1950. Kennedy did it again in the early 1960?s with the investment tax credit and accelerated depreciation. Nixon did it again in the 1970?s and, of course, the Reagan revolution in the early 1980?s. Interestingly, the 1981 economic recovery act was one of the largest tax cutting pieces of legislation in the history of the tax system. It was followed in 1982 by what was up to that time the largest tax increase...ever!!! We never got a tax increase as large as the Reagan 1982 increase until...the 1993 Clinton increase, which of course destroyed the economy, right?