Our Tax System Explained: Bar Stool Economics

[Devonin]

This was posted on the forum where I moderate the critical thinking section, and it seemed really interesting to think about. What do you think?

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. 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.' 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 got' '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 get the most benefit 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.

Is this how we really feel towards the wealthy?

[abbey]

:yh_hypno

I need a beer!

[Rapunzel]

Devonin;1038353 wrote: And that, ladies and gentlemen, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit 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.


I thought it was the other way round. Poor people pay have to pay their taxes, rich people get perks, get money back from shareholdings and float companies on the promise of wealth. Isn't that how the credit crunch happened? Rich people skimming money off and becoming uber-rich and the system finally collapsing because it could no longer support the huge amounts they were collecting?

I'm hazy about this stuff. All I know is that despite your analogy, poor people get whacked with taxes regardless of how your nice summary works and rich people seem to get tax breaks and tax credits and end up paying less than the rest of us! Meanwhile they're getting rich off the rest of us and we have to pay even more taxes to get them out of the sh*t they've landed us all in!

[Accountable]

Rapunzel;1038385 wrote: I thought it was the other way round. Poor people pay have to pay their taxes, rich people get perks, get money back from shareholdings and float companies on the promise of wealth. Isn't that how the credit crunch happened? Rich people skimming money off and becoming uber-rich and the system finally collapsing because it could no longer support the huge amounts they were collecting?



I'm hazy about this stuff. All I know is that despite your analogy, poor people get whacked with taxes regardless of how your nice summary works and rich people seem to get tax breaks and tax credits and end up paying less than the rest of us! Meanwhile they're getting rich off the rest of us and we have to pay even more taxes to get them out of the sh*t they've landed us all in!
No kiddin' you're hazy! Poor people pay no federal taxes at all, and the credit crunch was about credit, not taxes.



Let's oversimplify a sec, since that's what I'm often accused of.

http://www.unclefed.com/IRS-Forms/2007/i1040.pdf

Looking at taxable income only (that's after all the deductions & such) in 2007,


a person making $30,00 will pay $4113.00 if single and $3712.00 if married filing jointly.

10 such people would pay $41130.00 and $37120.00 respectively.

a person making $300,000 (10 times the person in the first example) would pay $85,068 if single (20 times the person in the first example) and $78,200 if married filing jointly (21 times the person in the first example)

So one person who generates the same income as 10 people will pay double the taxes. Fair??

[gmc]

Accountable;1038392 wrote: No kiddin' you're hazy! Poor people pay no federal taxes at all, and the credit crunch was about credit, not taxes.



Let's oversimplify a sec, since that's what I'm often accused of.

http://www.unclefed.com/IRS-Forms/2007/i1040.pdf

Looking at taxable income only (that's after all the deductions & such) in 2007,


a person making $30,00 will pay $4113.00 if single and $3712.00 if married filing jointly.

10 such people would pay $41130.00 and $37120.00 respectively.

a person making $300,000 (10 times the person in the first example) would pay $85,068 if single (20 times the person in the first example) and $78,200 if married filing jointly (21 times the person in the first example)

So one person who generates the same income as 10 people will pay double the taxes. Fair??


Single person earning $30,000 is left with $25,887 or 86% if their income

married couple earning $30,000 is left with $26,288 or 87.62% of their income.

Single person earning $300,000 is left with $214,932 (8X the income of the $30,000 earner) or 71% of his income.

Married person earning $300,000 is left with 74% of their income (again roughly 8X the $30,000 couple)

So one person who generates the same income as 10 people will pay double the taxes. Fair?


So the person who generates the same income as ten people will pay double the taxes and still be 8X better off. Unless families on a low income need less food then the poorer couple spend a higher portion of their income on basic necessities, have less disposable income so have no money for luxuries like cars for instance, or eat out more often Meanwhile the ones with eight times the income can buy a car each-or a bigger house.

Let's be really rotten and take the couple on $30,000 out of the tax bracket altogether and get the rich ones to pay more tax-$37120 more so the $300,000 is now left with only $184680 or 61% of their income now they are only 6X the income of the $30,000 couple. So they can't afford the extra cadillac they were going to buy.

In the other hand the ten on $30,000 now have more disposable income, they can feed their kids better, buy more clothes and other things-maybe they can buy the car they couldn't afford before-ten middle range cars rather one cadillac-which generates more jobs one expensive car or ten less expensive ones. maybe they might buy an american made car even. They can eat out more-go to the cinema generating even more jobs. Maybe they can buy their own house or at least spend money on new furniture or that TV for the kids generating even more jobs. ten TV's or one in the bathroom for the wealthy which generates more jobs.

What about the guy on £300,000? he's got a business but now he has more customers because people who had no disposable income can now buy things so his business starts to grow as well so does his income so now he's not just earning a paltry $300,000. So yes he is paying more in tax but benefiting in the long run from doing so. He still pays a higher percentage in tax but he's still better off in the long run.

It's basic economics, the more disposable income you can put in to more people's pockets the better the economy. Trickle down from the rich spending more does not work all they tend to do is hoard it or spend the money on luxuries that don't generate much in the way of jobs -you should know you live in a country where you've been daft enough to believe it. On the other hand putting more money in more people's pockets even if a few at the top feel hard done by generates more wealth and more jobs-it's better in the long run all round.

Forget fair it makes more economic sense not to overtax those on lower and middle income.

[Devonin]

So you wnt to devise a system wherein the harder I work, the more I produce, the more I contribute to the overall economic success of the country, the larger and larger a percentage of my income you take away to give to other people?

You're creating a disincentive to work hard. You're encouraging mediocrity. You're basically making it so that it is in my own best interest to find a middle range where an acceptable percentage of my income remains my own, and then simply stop trying to work harder, improve or expand, because all that will happen is that an even larger percentage of my earnings will be taken away.

If I earn 10 times the money from my efforts as somebody else, why -shouldn't- I make, you know, 10 times the money as they do even after taxes?

Sure, if you take even more money from the very rich and give it to the poor, the poor will have more money, but the rich will also have less money. Maybe now their company can't do that expansion it wanted to which would generate a few thousand new jobs and give a good chance to people who are out of work. Maybe they won't make that charitable donation of 30,000 dollars to cancer research because the extra money has been taken in higher taxes.

And then there's the analogy being used in the bar scenario. If the rich "feel hard done by' as you say, you're not only providing a disincentive to continue working hard and producing and expanding, you're also creating an incentive for the already rich to just leave and earn their money somewhere else. And -then- what do you do when your middle and lower classes are both suddenly out of work because the plants and factories are being relocated out of country, -and- your rich people are no longer having their income taxed away to line the pockets of those newly unemployed folks?

[gmc]

posted by devonin

Sure, if you take even more money from the very rich and give it to the poor, the poor will have more money, but the rich will also have less money. Maybe now their company can't do that expansion it wanted to which would generate a few thousand new jobs and give a good chance to people who are out of work. Maybe they won't make that charitable donation of 30,000 dollars to cancer research because the extra money has been taken in higher taxes.


Kind of answered that point

What about the guy on £300,000? he's got a business but now he has more customers because people who had no disposable income can now buy things so his business starts to grow as well so does his income so now he's not just earning a paltry $300,000. So yes he is paying more in tax but benefiting in the long run from doing so because his income rises as a consequence. He still pays a higher percentage in tax but he's still better off in the long run.


Anyway, I thought the point was about individual taxation rather than company taxation. Don't know about the states or canada tax systems so can only talk in general terms. But here here in the UK company taxation and personal taxation are two separate issues.



So you give tax breaks as an incentive to companies that reinvest their profits rather than taking it out as income for the shareholders. (Charitable donations also attract tax relief in the UK). They benefit in the long run as the company-and therefore their shares become worth more. Lift the level at which company taxation kicks in. One of the issues here is that large fund managers demand a dividend to keep their investors happy so there is a disincentive for long term planning and investment. companies are obliged to produce dividend for the shareholders and to keep big institutional investors happy when less profit and more reinvestment might be better in the long run which lead to short term thinking aimed at keeping them happy.

suddenly out of work because the plants and factories are being relocated out of country,




Helps the bottom line-after all the sole purpose of a company is to make a profit and if mexican-or wherever- workers cost less than american that's all that matters. The rich get to make more money why should ordinary workers expect a greater share of he profits or feel they are being unfairly treated? It's just business after all. Why do you think that a bad thing? All that extra wealth being generated by the extra profits made is going back in to help- the economy as the rich let it trickle down.

What do you do about those who are wealthy through no effort of their own and can hardly be accused of using their wealth to generate jobs for others-the paris hiltons of this world for instance. Or all those wealthy pop stars who just build up more and more wealth -should they pay more in tax as their income comes from a service industry? what good does that do for the economy as a whole?

Here the real growth and innovation in the economy comes from small to medium businesses, sole trader or four or five shareholders-those are the companies and sector of the economy you need to help not the big multinationals. Microsoft used to be a small business so did hewlett packard etc etc.

You seem to view giving tax breaks to those on lower incomes as giving them a handout that goes to waste. Lower income doesn't mean you are somehow less worthy or lacking in intelligence or ability. In the present economic climate you need to do something to generate some spending power. Why you think letting fewer and fewer people accumulate wealth and fewer and fewer people have control of your nations wealth is a good thing is completely beyond me. Next you'll be letting them decide who should get to rule you as well, disenfranchise all those who can't afford their own homes or who don't earn enough to pay taxes will be next.

[coberst]

Is ten guys buying beer in a bar an apt analogy for the nation's tax system? I see no connection between the two situations.

[Bryn Mawr]

coberst;1038972 wrote: Is ten guys buying beer in a bar an apt analogy for the nation's tax system? I see no connection between the two situations.


No connection at all but it makes them feel good and saves them from thinking

[Accountable]

coberst;1038972 wrote: Is ten guys buying beer in a bar an apt analogy for the nation's tax system? I see no connection between the two situations.
None at all? Even after reading the arguments for & against?? I'm surprised. I thought your self-education would have helped you be less myopic.

[coberst]

Accountable;1039240 wrote: None at all? Even after reading the arguments for & against?? I'm surprised. I thought your self-education would have helped you be less myopic.


I must plead ignorance. Please help me here!

The arguments given are based upon the framing of the analogy, which are worthless if the analogy is not apt.

[Accountable]

coberst;1039252 wrote: I must plead ignorance. Please help me here!



The arguments given are based upon the framing of the analogy, which are worthless if the analogy is not apt.
How is it not apt? The richer pay a larger share in taxes (price of beer) than the poorer. Both the richer and the poorer are fine with and accept that. It only makes sense that if there is a tax cut (reduction in beer price) that the richer would likewise enjoy a larger share of the discount. Yet when that happens, the poorer complain. Clearly, even explicitly, the analogy points out that ostracizing the richer risks that the richer will leave and take their money with them.

[Devonin]

It's not even the fact that the more you make the more you pay in objective dollars (Since after all 30% of 150,000 is more than 30% of 100,000) it's the fact that if you paid out 30% of 100,000, and now you make 150,000, you're asked to pay out 35% instead.

That's the other thing that happens in the beer story. There's the issue of the group getting a discount, and the one paying the most money feeling that he should get a larger share of the discount (And you'll notice, he even gets a LOWER percentage discount than the other men) And there is also the issue of what happens if the richest man paying 56 dollars of the tab gets a raise, and the other men suggest to him (while their incomes remain exactly the same as before) that he start paying 65 dollars of the tab, and giving them all an additional dollar off.

[gmc]

Accountable;1039256 wrote: How is it not apt? The richer pay a larger share in taxes (price of beer) than the poorer. Both the richer and the poorer are fine with and accept that. It only makes sense that if there is a tax cut (reduction in beer price) that the richer would likewise enjoy a larger share of the discount. Yet when that happens, the poorer complain. Clearly, even explicitly, the analogy points out that ostracizing the richer risks that the richer will leave and take their money with them.


It's a pathetic analogy designed to appeal to those who don't want to think for themselves.

Better one would be the first four are outside looking in, the fifth goes on for the free peanuts, the sixth has a half pint, the and seventh has a half pint and a wee nippy sweetie to help him feel better, the eight has a pint and a packet of crisps the ninth can afford a bar meal meanwhile the tenth has a four course slap up meal leaves a massive tip and on the way out throws a couple of pennies at the first four who are eternally grateful at the opportunity to see trickle down economics in action.

[Accountable]

gmc;1039365 wrote: It's a pathetic stupid designed to appeal to those who don't want to think for themselves.



Better one would be the first four are outside looking in, the fifth goes on for the free peanuts, the sixth has a half pint, the and seventh has a half pint and a wee nippy sweetie to help him feel better, the eight has a pint and a packet of crisps the ninth can afford a bar meal meanwhile the tenth has a four course slap up meal leaves a massive tip and on the way out throws a couple of pennies at the first four who are eternally grateful at the opportunity to see trickle down economics in action.
Could you please be kind enough to explain your analogy, it being so much wiser & all and designed for thinkers?

[gmc]

Accountable;1039671 wrote: Could you please be kind enough to explain your analogy, it being so much wiser & all and designed for thinkers?


Which bit didn't you understand?

Maybe it was the measures-we sell beer in our pubs by the pint. a wee nippy sweetie is a whisky. drinking whisky and a beer chaser used to be (actually it still is, also known as a half and half) a quick way to get blind drunk-the beer ensuring the whisky is absorbed in to he bloodstream more quickly. a traditional Scottish method of dealing with misery by feeling happy for a while before passing out. Drugs are used by some people as an alternative although the more affluent claim to choose it as a recreational tool and in the case of celebrities add to their street cred by going in to rehab. The difference between a recovering alcoholic and a drunken wastrel is one has money the other had nothing and still has most of it left.

[Accountable]

gmc;1039778 wrote: Which bit didn't you understand?
How it, by any stretch of your so fully fertile imagination, is an analogy for the American tax system.

[coberst]

How does one go about determining the aptness of an analogy or metaphor?

An analogy or linguistic metaphor is used to help understand an unknown by comparing it with a known; metaphors and analogies are means for framing an issue to help with the understanding of a new idea. It is also a technique that is very useful for manipulating opinion. It can help in the understanding of truth and it can help make nonsense appear to be true.

Often, when using a metaphor or analogy, we wish to use an objective experience to aid in the understanding of a subjective concept.

“Philosophy in the Flesh by Lakoff and Johnson provides a means for studying this matter.

[BTS]

coberst;1038972 wrote: Is ten guys buying beer in a bar an apt analogy for the nation's tax system? I see no connection between the two situations.


HUH??????

I thought you were a deep thinker.

This surprises me.

Seems not so different than some of your bizarre topics .

Maybe you can relate to it like this?



Learning The A, B and Cs Of Progressivism

By H. L. Clark, For The Bulletin

10/14/2008







Progressivism is a term we've often heard expressed in terms of endearment by certain politicians this election season. One of the commonly understood manifestations of progressivism is the "progressive income tax system" in which the more someone earns, the higher the percentage of tax he or she pays. Fair Share is the mantra; "the rich need to pay their Fair Share". For all practical purposes, the definition of fair simply means "more".



Many college professors recommend to their students the superiority of progressivism, but utterly fail themselves to apply it in the classroom. Imagine what it would be like if progressivism were actually taught and practiced in the classroom. Students would experience first hand the practical out-workings of progressivism earlier in life so that they would more fully embrace it as adults. Allow me to explain.



What is the currency of choice in education? Points. Points are earned to obtain grades, much like dollars are earned to secure stocks, bonds and real estate. Students rich in points obtain AS while other students might earn only enough points to secure BS, CS, DS and even FS.



Mirroring the brilliance of progressive governmental tax tables, students would be required to "voluntarily comply" in surrendering their Fair Share of excess points. The professor would then re-distribute these excess points among the less fortunate students in the class. For example, students earning an average of 95 or more points out of a possible 100 would "contribute" 50 percent of all the needed points, while students earning fewer than 75 points would not be required to contribute any points at all.



Then, with the wisdom of Solomon and the compassion of Mother Theresa, the professor would redistribute the excess points so that everyone in the class can obtain at least a passing grade. Even progressive professors know that the hardest working students must be permitted to attain a slightly higher grade so that they have the incentive to continue studying hard and earning points. Their excess points will always be needed for the good of the class at large.



It's unfair that any students should be permitted to earn AS on the backs of the other students. After all, there are just so many points to go around and if the A students hoard the points, the B, C, D and F students will never be able get ahead. Redistribution of points helps to facilitate class unity; everyone can come together where true equality, the general welfare and common good can be a reality.



Progressivism is indeed a virtuous and morally superior ideology. Education is the key. It should begin in the first grade. With a little creativity, progressivism could also be applied to athletics so that all teams end their seasons in a tie . . . no losing seasons!



Not convinced? You'd better not be! This kind of thinking ignores basic human nature; it is in fact de-humanizing. Every person ought to be encouraged to become as successful as they can be in the classroom and in all areas of life. Achievement should always be celebrated! Underachievement must be compassionately and unapologetically discouraged. To punish achievement and reward under-achievement or even sloth is misguided compassion at best and enslavement at worst.



But isn't it government's responsibility to punish greed and ensure social equality? Last time I checked, the Declaration of Independence boldly declared that all men are endowed by their Creator with certain inalienable rights, those being life, liberty and the pursuit of happiness. Look again; it's the pursuit of happiness, not its attainment. Students can't pursue and attain AS if they aren't permitted to settle for FS. Progressivism undermines personal liberty by undermining personal responsibility. If progressivism is unjust for the classroom, it's unjust in any context. It is also unavoidably divisive and embittering wherever practiced. It must always be implemented either by force or coercion.



Liberty is a powerful force and yet by its nature an essential paradox. As Americans, we can only be at our best if we are permitted to be at our worst. We can only succeed if permitted to fail. We can only be enormously generous if permitted to be utterly selfish. Life is about choices and consequences. Progressivism tries to limit both choice and consequence in the name of fairness. There will always be greed and selfishness but history has clearly shown that the vast majority of Americans choose to volunteer and be generous with their neighbor when needs arise. Any Americans who are truly greedy and selfish will have to settle their accounts with the Creator who entrusted them to steward their precious inalienable rights. Our forbearers rebelled against the British Crown risking life and fortune for liberty, rejecting the injustices of involuntary servitude and taxation without representation. Progressivism re-imposes a veiled version of both.

[BTS]

gmc;1039365 wrote: It's a pathetic analogy designed to appeal to those who don't want to think for themselves.



Better one would be the first four are outside looking in, the fifth goes on for the free peanuts, the sixth has a half pint, the and seventh has a half pint and a wee nippy sweetie to help him feel better, the eight has a pint and a packet of crisps the ninth can afford a bar meal meanwhile the tenth has a four course slap up meal leaves a massive tip and on the way out throws a couple of pennies at the first four who are eternally grateful at the opportunity to see trickle down economics in action.
See above post

[BTS]

Quote:

Originally Posted by Accountable

Could you please be kind enough to explain your analogy, it being so much wiser & all and designed for thinkers?



gmc;1039778 wrote: Which bit didn't you understand?



Maybe it was the measures-we sell beer in our pubs by the pint. a wee nippy sweetie is a whisky. drinking whisky and a beer chaser used to be (actually it still is, also known as a half and half) a quick way to get blind drunk-the beer ensuring the whisky is absorbed in to he bloodstream more quickly. a traditional Scottish method of dealing with misery by feeling happy for a while before passing out. Drugs are used by some people as an alternative although the more affluent claim to choose it as a recreational tool and in the case of celebrities add to their street cred by going in to rehab. The difference between a recovering alcoholic and a drunken wastrel is one has money the other had nothing and still has most of it left.


:p:p:p:p

[Accountable]

BTS;1040375 wrote: Students can't pursue and attain AS if they aren't permitted to settle for FS. Progressivism undermines personal liberty by undermining personal responsibility. I deal with this daily. My students (not the typical average student, remember) refuse to do their classwork and think that taking a nap is a viable alternative - it's being quiet and not disturbing anyone, so it deserves some credit. They invariably get upset when they find they've failed the class. I'm deemed an unfair lying bastard for "giving" them low grades. Somewhere along the line, they've been taught that they are entitled to a passing grade without putting forth any effort.

BTS wrote: As Americans, we can only be at our best if we are permitted to be at our worst. We can only succeed if permitted to fail. We can only be enormously generous if permitted to be utterly selfish. Life is about choices and consequences. I keep forgetting to bring out this most valid and valuable point: it's about trust. What this article calls progressivism is based on a general distrust of human nature. It assumes that people won't help other people without coersion. They point out acts of selfishness and hoarding as evidence to support their claim, without acknowledging that the threat of having one's stuff taken away results in greed and hoarding, even by those who would normally be generous and giving. It's a self-fulfilling prophesy.



Conversly, trusting in the social instinct and natural generosity of humans will generally naturally result in the same type of generosity and helpfulness progressivism tries to impose by law. It's also a self-fulfilling prophesy.



Too bad there's not enough trust in our fellow man to give it a try.

[gmc]

Accountable;1040149 wrote: How it, by any stretch of your so fully fertile imagination, is an analogy for the American tax system.


It's along the same lines as the bar stool one but more apt imo as taxation is about what people have left to spent not what they choose to spend.

apart from that I know nothing about your tax system and have no intentions of wasting any time finding out. Bear in mind I live in a country where progressive taxation is actively used to re-distribute wealth. Our higher rate of tax is 40%. We argue about the best way not about whether we are going to do it. Company tax and personal tax are two separate things. The amount of sympathy a bleating millionaire doesn't get would no doubt shock you.

Do Americans get taught anything about economics Adam Smith, John Maynard Keynes, Milton Friedman et al at school or study social history? How come none of you seem to know what socialism and fascism are?

came across this

http://taxcut.barackobama.com/

what's average income in the states anyway?

[Accountable]

gmc;1040512 wrote: It's along the same lines as the bar stool one but more apt imo as taxation is about what people have left to spent not what they choose to spend. That is an excellent summary of the difference between your culture and mine, concerning taxes and the government's role. Thank you!! :-6

[gmc]

Accountable;1040587 wrote: That is an excellent summary of the difference between your culture and mind, concerning taxes and the government's role. Thank you!! :-6


You already use progressive taxation in the US. Why does the idea that people on lower incomes get to keep more of their income such a problem to you?

[Bryn Mawr]

Accountable;1040587 wrote: That is an excellent summary of the difference between your culture and mine, concerning taxes and the government's role. Thank you!! :-6


Certainly - you tax people on the money they have, not on money they cannot possibly use to pay taxes.

[Accountable]

gmc;1040512 wrote: It's along the same lines as the bar stool one but more apt imo as taxation is about what people have left to spent not what they choose to spend. Accountable;1040587 wrote: That is an excellent summary of the difference between your culture and mine, concerning taxes and the government's role. Thank you!! :-6
You believe your government should decide how much money citizens get to keep, implying that it's not really theirs to begin with. We, on the other hand, own our money. The government, in theory, is to accept from us no more than is necessary to function. The definition of "function" is what's in continuous debate, of course.



So it makes sense that you would believe that using taxes to redistribute wealth is normal and natural, since it is the government's wealth to distribute.

[Bryn Mawr]

Accountable;1044658 wrote: You believe your government should decide how much money citizens get to keep, implying that it's not really theirs to begin with. We, on the other hand, own our money. The government, in theory, is to accept from us no more than is necessary to function. The definition of "function" is what's in continuous debate, of course.



So it makes sense that you would believe that using taxes to redistribute wealth is normal and natural, since it is the government's wealth to distribute.


No. The people, through their agency the government, decide on a minimum limit below which a member of our society could not carry on a humane existence.

One of the functions of government is to ensure that society continues to function. We, the people, have decided that having sections of our society living in Dickensian conditions is not acceptable and we demand that some of our money is spent to prevent that.

As gmc has repeatedly said, it is important to remember who is boss - the government is there to serve the people not to own or control them.

Re-distribution of wealth would be wholesale equalisation of earnings - not ensuring that each family has at least £100 / week to stop it dying of starvation and exposure (average income is about £300 / week so it is not exactly wealth we're talking about here).

On the other hand, inheritance tax is all about the re-distribution of wealth

[K.Snyder]

Devonin;1038657 wrote: So you wnt to devise a system wherein the harder I work, the more I produce, the more I contribute to the overall economic success of the country, the larger and larger a percentage of my income you take away to give to other people?

You're creating a disincentive to work hard. You're encouraging mediocrity. You're basically making it so that it is in my own best interest to find a middle range where an acceptable percentage of my income remains my own, and then simply stop trying to work harder, improve or expand, because all that will happen is that an even larger percentage of my earnings will be taken away.




Work harder for what?...

What is it about "equality" that people define such as being "unfair"?...You people just cannot understand logic.

Raising minimum wage at the same time reducing the costs of necessities would benefit the impoverished at the same time virtually seeing no effect whatsoever upon the extremely wealthy by virtue of the fact that the markets demand less.

What's left is people fearing they'd be the only ones taking action ultimately reducing the worth of their domestic currency to the point people spread the neurotism of "wealth redistribution will make us work more for equal pay" which is asinine.

Reduce the cost of real estate you worthless pigs!

[gmc]

Accountable;1044658 wrote: You believe your government should decide how much money citizens get to keep, implying that it's not really theirs to begin with. We, on the other hand, own our money. The government, in theory, is to accept from us no more than is necessary to function. The definition of "function" is what's in continuous debate, of course.



So it makes sense that you would believe that using taxes to redistribute wealth is normal and natural, since it is the government's wealth to distribute.


No I don't. I can't decide whether you are just being obtuse or just thick. We see the governments function is to do what is expected of them. You seem to believe that you pay government but actually have no real say in what it should be doing for you. More to the point you seem to believe you should not be allowed to make any demand of it.

You also pay taxes and elect a government giving it the right to levy those taxes. So do we. Hopefully you get some say in how much is taken and how it is used. We on the other hand don't just give them no more than what is necessary to function like they were some strange pet we need to keep happy but which we can't control. We also expect it to do certain things for us. We tend to make our opinions clear at the ballot box and governments that are seen as not looking after our interests eventually get kicked out. Taxation is obviously a major concern but we expect tax to used in certain ways. If governments fail to deliver they eventually get voted out. Wealth re-distribution was a major factor in the past it is less so now. In fact it isn't really one any more. Taxing those on lower incomes unfairly is a vote loser. Recently our chancellor removed a lower tax rate of 10%. It was seen as unfair-The resulting outcry had him changing his mind pretty damn quickly.



Essentially we view the function of government as being slightly different but the basic principle is the same. Governments answer to those who elect them sooner or later and govern only with our consent. Periodically politicians need a good kicking as they have a tendency to think they are there by right.

You also use progressive taxation in the states so the concept and practice is hardly a new idea. Except I get the impression you use it to make the rich richer in the rather strange belief that this wealth will trickle down to the plebs at the bottom of the food chain.

Like most on the right and left of politics you like statistics especially averages and percentages.

The average male in america has less than two legs. That is factually correct but does it actually tell you anything helpful?

posted by accountable

a person making $300,000 (10 times the person in the first example) would pay $85,068 if single (20 times the person in the first example) and $78,200 if married filing jointly (21 times the person in the first example)




Factually correct. (I assume) but does it really tell you very much?

posted by me

Single person earning $30,000 is left with $25,887 or 86% if their income

married couple earning $30,000 is left with $26,288 or 87.62% of their income.

Single person earning $300,000 is left with $214,932 (8X the income of the $30,000 earner) or 71% of his income.

Married person earning $300,000 is left with 74% of their income (again roughly 8X the $30,000 couple)


Again factually accurate but which tells you more? Which one of those income groups if allowed to keep more of their income is more likely to spend the money in local businesses and manufacture and help the greater economy. To me it's a no brainer, put more money in more people's pockets benefits the economy as a whole. If a few wealthy people pay more in tax I'm fairly sure a good accountant will find a loophole somewhere for them

To be blunt if you still think letting the rich accumulate more and more wealth while the poor get poorer is better for the economy rich despite all the experience of the last few years you're either naive or the idea of living in a country where the rich look after the poor out of some sense of noblesse oblige appeals to you for reasons i just can't understand.

How does deciding to let those on middle incomes keep more of their hard earned income rather than take it as taxes get transmuted in to taking from the rich to give to the poor? How does letting someone on $30,000 pay less in tax somehow become unfair and not a good idea?

You already accept the principle of wealth re-distribution seems to me you need to decide whether you want a society where more people get a chance to benefit from the wealth or you let the rich just build up their wealth and resulting power base.

I don't know your tax system except you all seem to pay more tax than us and get far less out of it than we do.

[Accountable]

Bryn Mawr;1044822 wrote: No. The people, through their agency the government, decide on a minimum limit below which a member of our society could not carry on a humane existence.



One of the functions of government is to ensure that society continues to function. We, the people, have decided that having sections of our society living in Dickensian conditions is not acceptable and we demand that some of our money is spent to prevent that.Then we agree, except probably on that minimum limit. I'm becoming more and more convinced that the only real disagreement stems from ya'll's (possessive form of the plural personal pronoun ya'll) misperception of what we think and believe in. Are you implying that we, the people of the USA, have decided that having sections of our society living in Dickensian conditions IS acceptable?

[Accountable]

gmc;1044870 wrote: No I don't. I can't decide whether you are just being obtuse or just thick. We see the governments function is to do what is expected of them. You seem to believe that you pay government but actually have no real say in what it should be doing for you. More to the point you seem to believe you should not be allowed to make any demand of it. Your statement of judging fairness of taxes on what one has left kinda set me off. The problem here in the US, as I see it, is one you cannot have because you are smaller. More and more government function is being centralized in Washington, where the decisionmakers are too far removed from their constituents. If most deicisions were made by state legislatures (which are closer in size to the UK), as our Constitution was written and currently ignored, we would have better representation.

Who knows? Maybe a couple of states would even end up to the left of you lot.

[gmc]

Accountable;1044903 wrote: Your statement of judging fairness of taxes on what one has left kinda set me off. The problem here in the US, as I see it, is one you cannot have because you are smaller. More and more government function is being centralized in Washington, where the decisionmakers are too far removed from their constituents. If most deicisions were made by state legislatures (which are closer in size to the UK), as our Constitution was written and currently ignored, we would have better representation.

Who knows? Maybe a couple of states would even end up to the left of you lot.


Who knows indeed. i don't see how you can be an american and not believe in liberal values (liberty,equality etc etc ) buy yet you seem to have been convinced that liberalism is the same as communism. Democracy is no longer a good thing and that questioning authority is somehow unamerican and unpatriotic. I think we basically agree more than we disagree on most things but just express things differently.

We have a similar problem here in that currently we have a government that is trying to be more and more controlling with a prime minister-and his predecessor as well come to that-who are control freaks. More and more they have been behaving as if they had presidential powers even to the extent of appointing non elected advisers to positions of authority. He will shortly be out of office and it looks increasingly likely that the labour party is finished as a viable political force at least in the short term. We expect government to do a lot but not let it go to their heads. There's a tendency to set targets for things so they can measure their impact but then the target becomes the reason for doing something rather than the real reason which was to provide a service. Most of our MP's couldn't get a job in real life, they'd get fired for congenital stupidity. Maybe they can get jobs in the city as fund managers. The day you can't say you think your political leaders are complete dickheads without being accused of being unpatriotic is the day you will know you have a problem.

Who knows? Maybe a couple of states would even end up to the left of you lot.


Doubt it. If the far left could leave off the in-fighting long enough they'd be in with a chance. But they prefer quoting marx at each other, addressing each other as brother and sticking the knives in at every opportunity. Bit like religious fundamentalists without the jaggy bunnet and the long dress.

[Bryn Mawr]

Accountable;1044898 wrote: Then we agree, except probably on that minimum limit. I'm becoming more and more convinced that the only real disagreement stems from ya'll's (possessive form of the plural personal pronoun ya'll) misperception of what we think and believe in. Are you implying that we, the people of the USA, have decided that having sections of our society living in Dickensian conditions IS acceptable?


That certainly appears to be what you are saying

[Accountable]

Bryn Mawr;1046022 wrote: That certainly appears to be what you are saying
Then either I don't understand your definition of Dickensian or you need to adjust your stereotype.

[Bryn Mawr]

Accountable;1046031 wrote: Then either I don't understand your definition of Dickensian or you need to adjust your stereotype.


Or you need to adjust your rhetoric :p

[gmc]

Accountable;1046031 wrote: Then either I don't understand your definition of Dickensian or you need to adjust your stereotype.


It's our stereotype you need to learn what it means.

[Accountable]

gmc;1046312 wrote: It's our stereotype you need to learn what it means.
:wah: Touche'