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
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that's a dubiously reasonable argument for flat taxes, but it doesn't apply very well here because we don't have a "you're good customers so i'll cut you a break" situation- we have a "holy fuck the bar is broke as shit and can't pay rent" situation, and the first eight guys are flat broke and taking out risky loans to buy their beer. furthermore, these are taxes, which means that the tenth guy doesn't have the option of not showing up. he's gonna be there and pay for his beer one way or the other, and if he doesn't he winds up in jail
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A few thoughts...darklinkOctober 30 2008, 06:52:00 UTC
Lets see if I can speak to a few things...
1. To me the analogy isn't about flat taxes but rather pointing out that the rich pay a huge portion of the tax burden where as the lowest earners in our country pay squat.
2. The idea of taking wealth out of the country works on a few levels. America's corporate tax rate is among the higher end in the first world. Places like Germany and Ireland have drastically cut their corporate income tax because they have found it creates jobs and income. Somehow we don't seem to get that...
3. I can't really speak towards the flat tax specifically - I have not spent much time getting into it and don't have a feeling one way or the other.
Broken analogy.squidb0iOctober 30 2008, 03:49:49 UTC
Dr. Kamerschen perhaps spends too much time in his ivory tower: This assumes that taxes occur in a vacuum, independent of any other factor. The rich benefit from society more, so they pay more to maintain it.
More the point, do you make more than a quarter million a year in taxable income? Didn't think so. Enjoy your tax cut.
Re: Broken analogy.squidb0iOctober 30 2008, 15:31:08 UTC
*shakes head in amazement*
1. Obama's plan is to grow the economy from the bottom up; top down has failed repeatedly.
2. The needs of the many outweigh the needs of the few.
3. Even if you want to stretch the definition of welfare that far, Bush already beat him to it by handing out his Bush Bucks stimulus checks. What'd you do with yours? I paid for vet bills.
Also, I understand that $100 is a nice round number to use, but it's also seriously misleading. Firstly, it implies that 40%-50% of the US population doesn't pay taxes and instead get some kind of government welfare (free beer). This is untrue. The actual percentage is much lower.
Additionally, it leads the reader who is not versed in the current state of the US tax code to believe that the rich pay up to 59% of their income as taxes. This is again untrue, as the highest tax bracket is currently 35%. Contrast this with when income taxes were first created, when the richest people were taxed at a rate of approximately 80%.
The bottom 50% of earners in this country pay roughly 3% of the total federal income tax. The bottom 33% pay, essentially, nothing in taxes. I don't feel it is particularly misleading to say that the bottom half of the tax ladder contribute minimally to the overall tax collected.
As far as the analogy goes... it has nothing to due with tax percentages. The point is that, regardless of their laddered tax rates, a rich person is paying an immensely greater portion of the overall tax burden than the lower income earners (in this case, 59:18, 59:12, etc).
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1. To me the analogy isn't about flat taxes but rather pointing out that the rich pay a huge portion of the tax burden where as the lowest earners in our country pay squat.
2. The idea of taking wealth out of the country works on a few levels. America's corporate tax rate is among the higher end in the first world. Places like Germany and Ireland have drastically cut their corporate income tax because they have found it creates jobs and income. Somehow we don't seem to get that...
3. I can't really speak towards the flat tax specifically - I have not spent much time getting into it and don't have a feeling one way or the other.
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This assumes that taxes occur in a vacuum, independent of any other factor.
The rich benefit from society more, so they pay more to maintain it.
More the point, do you make more than a quarter million a year in taxable income?
Didn't think so. Enjoy your tax cut.
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1. Obama's plan is to grow the economy from the bottom up; top down has failed repeatedly.
2. The needs of the many outweigh the needs of the few.
3. Even if you want to stretch the definition of welfare that far, Bush already beat him to it by handing out his Bush Bucks stimulus checks. What'd you do with yours? I paid for vet bills.
3.1 Last time I checked, McCain's own plan uses the same mechanism to push money up the food chain to the wealthy. Oh the colossal irony.
http://www.factcheck.org/elections-2008/obamas_welfare.html
So which would you prefer? Do YOU and I and everyone you know get the tax credit, or does Barack Obama? Those are your choices. Pick one.
4. This cute little cartoon lays it out pretty clearly:
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Also, I understand that $100 is a nice round number to use, but it's also seriously misleading. Firstly, it implies that 40%-50% of the US population doesn't pay taxes and instead get some kind of government welfare (free beer). This is untrue. The actual percentage is much lower.
Additionally, it leads the reader who is not versed in the current state of the US tax code to believe that the rich pay up to 59% of their income as taxes. This is again untrue, as the highest tax bracket is currently 35%. Contrast this with when income taxes were first created, when the richest people were taxed at a rate of approximately 80%.
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As far as the analogy goes... it has nothing to due with tax percentages. The point is that, regardless of their laddered tax rates, a rich person is paying an immensely greater portion of the overall tax burden than the lower income earners (in this case, 59:18, 59:12, etc).
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(sorry, I just wanted some levity.:))
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