Progressive Income Tax?

Off Topic Politics & World Issues
121

[quote]
BostonBarrister wrote:
That definition for GDP seems to indicate that it’s close enough for government work.

hspder wrote:
“Seems” is the key word here. Things are rarely what they seem. That’s why we have Math.[/quote]

Let’s look at the formula again:

GDP = Compensation of employees + Gross operating surplus + Gross mixed income + Taxes less subsidies on production and imports

The first three are measures of income – employee and business, respectively. The difference in the measure is the delta between taxes applicable to production and imports subsidies applicable to the same.

I suppose one could say that capital gains income wouldn’t be captured, so lets just assume that should be added to our tax base.

You’re telling me that you’d need more than a couple pecentage points correction upwards to get the approximate share of GDP you want, assuming you got rid of all those exemptions (that would, admittedly, be politically impossible to eliminate)?

And that’s without even assuming any rise in rates collected due to more compliance.

At any rate, the key is that reforming the “progressive” tax code in this way would lead to a re-examination of our redistributive priorities – on a case-by-case basis. That’s what really scares people with your proclivities about a flat tax. Thus your false dichotomy equating cuts in government benefits to a situation in which the streets would run red with the blood of the nonbelievers.

You made this point to Zeb, but I would specifically exclude Social Security and Medicare from these calculations – they’re flatter already, and they should be accounted separately so people can watch as they grow out of control.

122

You can use all the big words you want, but it comes down to MATH in the final analysis.

There is this little thing known as a detail… and when the rubber hits the road, those little details have to all be figured out.

All you need to look at is taxes on personal income, because going to a flat rate should leave corporate income and the rest as it is.

$X is raised on the current scheme. Going to a flat tax can be analyzed with respect to loss of revenues on declared incomes on the rich…

123

[quote]vroom wrote:
You can use all the big words you want, but it comes down to MATH in the final analysis.

There is this little thing known as a detail… and when the rubber hits the road, those little details have to all be figured out.

All you need to look at is taxes on personal income, because going to a flat rate should leave corporate income and the rest as it is.

$X is raised on the current scheme. Going to a flat tax can be analyzed with respect to loss of revenues on declared incomes on the rich…
[/quote]

What are you blathering on about now?

NOTE: Specifically the bolded section.

124

I know as a lawyer that numbers are probably not something you are used to dealing with…

125

[quote]GDollars37 wrote:
Lorisco wrote:
skor wrote:
Lorisco wrote:
skor wrote:
On the simplest level, progressive tax is “more fair” because utility of money is NOT a linear function, but a concave one - marginal utility of money decreases are wealth increases. Doubling your wealth doesn’t double the utility.

What progressive tax “achieves” is a more uniform (across incomes) tax on UTILITY of money, not money itself.

True, but putting in controls for those at the lower end of the scale for basic needs would fix that inequity. You could do this by lower end tax cuts. But aside from that, it is all about social architecture.

Well, there is no qualitative difference between progressive tax and tax cuts for the “poor”. Relatively it’s all the same, given that enough of taxes is collected to support necessary (and unnecessary;) )operations.

It IS all about social architecture and some value-decisions are to be made. I just do NOT understand people who feel that flat tax rate is a “fair” thing. Because is flat rate is fair, it has to be applied to utility, not amount of money itself.

I guess that would depend on your definition of “poor”. Making adjustments for the poor (whatever that number looks like - based on the value of the dollar and needed services and what they make) and give everyone else a flat rate would be fair in my estimation.

Taking care of the poor and punishing the rich are two different things. I think we can have a modified flat tax to take care of the poor while not punishing the rich.

Absolutely. But you’ll punish the middle class.[/quote]

What helps the rich helps the middle class as 90% of the middle class get their jobs working for the rich.

126

[quote]hspder wrote:
Lorisco wrote:
hspder wrote:
People there still pay Federal Income Tax. And Medicare. And Social Security. That’s why they manage to survive – thanks to the Federal Government which pays those bills.

You need to look again. I lived in Washington State and can tell you that many of those things are not supported by the Fed. They come from local property taxes and sales taxes. The difference is that their system is very efficient and they don’t have a shit-load of excess governmental waste like a lot of States.

Medicare and Social Security “come from local property taxes and sales taxes”?!

WTF?

Really, sometimes I wonder if people shouldn’t pass some kind of exam before they were allowed to vote.

However, I appreciate you bringing up property taxes, since Vroom’s proposal doesn’t include them either. So you basically added another point against your own argument that those States proved Sales Taxes are enough.
[/quote]

Listen dork, I never stated that sales taxes were enough. I stated that income taxes were not necessary. I also never stated that people in these States don’t pay federal tax for all the money the feds want to waste. However, those items do not cover the State and local services, which is what I was referring to.

127

[quote]vroom wrote:
I can understand that this is fundamentally against your beliefs but the fact remains that any period in History punctuated by lack of government intervention eventually created dramatic social unrest and bred a revolution.

DING DING DING. We have a winner…[/quote]

And the people taking back what is rightfully theirs from a corrupt government is a back thing?

128

[quote]Lorisco wrote:
And the people taking back what is rightfully theirs from a corrupt government is a back thing?
[/quote]

Yeah, right. One way to look at it is like this…

The purpose of the government is to legitimize a legal system which protects the rich from the poor through the use of force.

So, it’s a protection racket, and who is going to pay but those that actually have the money?

See? :stuck_out_tongue:

129

[quote]vroom wrote:
I know as a lawyer that numbers are probably not something you are used to dealing with…[/quote]

Yeah, but I’m corporate – we do numbers and spreadsheets all the time… And besides, everyone knows lawyers know how to count money well…

130

[quote]Lorisco wrote:

What helps the rich helps the middle class as 90% of the middle class get their jobs working for the rich.

[/quote]

That was well said and ofter forgotten by people who are jealous of those who are well off…and corporations.

As the old sang goes: “I have never seen a poor person hire anyone!”

131

[quote]BostonBarrister wrote:
vroom wrote:
I know as a lawyer that numbers are probably not something you are used to dealing with…

Yeah, but I’m corporate – we do numbers and spreadsheets all the time… And besides, everyone knows lawyers know how to count money well…[/quote]

LOL.

132

[quote]grew7 wrote:
Could we not find something to cut and not overburden the middle class? What about a little from everything? Stop foreign aid[/quote]

Foreign aid is less than 1% of the federal budget, and much of that is in “buy American” guarantees, and most of it is to Israel and Egypt anyway. We spend just about the lowest amount per capita in the developed world on foreign aid. Given that we’re the richest country in the world and all of sub-Saharan Africa accounts for less than 1% of world GDP, smart (key word) foreign aid is one of the few places where we should be spending more money.

133

[quote]Lorisco wrote:
GDollars37 wrote:
Lorisco wrote:
skor wrote:
Lorisco wrote:
skor wrote:
On the simplest level, progressive tax is “more fair” because utility of money is NOT a linear function, but a concave one - marginal utility of money decreases are wealth increases. Doubling your wealth doesn’t double the utility.

What progressive tax “achieves” is a more uniform (across incomes) tax on UTILITY of money, not money itself.

True, but putting in controls for those at the lower end of the scale for basic needs would fix that inequity. You could do this by lower end tax cuts. But aside from that, it is all about social architecture.

Well, there is no qualitative difference between progressive tax and tax cuts for the “poor”. Relatively it’s all the same, given that enough of taxes is collected to support necessary (and unnecessary;) )operations.

It IS all about social architecture and some value-decisions are to be made. I just do NOT understand people who feel that flat tax rate is a “fair” thing. Because is flat rate is fair, it has to be applied to utility, not amount of money itself.

I guess that would depend on your definition of “poor”. Making adjustments for the poor (whatever that number looks like - based on the value of the dollar and needed services and what they make) and give everyone else a flat rate would be fair in my estimation.

Taking care of the poor and punishing the rich are two different things. I think we can have a modified flat tax to take care of the poor while not punishing the rich.

Absolutely. But you’ll punish the middle class.

What helps the rich helps the middle class as 90% of the middle class get their jobs working for the rich.

[/quote]

That’s so oversimplified as to be retarded.

134

[quote]ZEB wrote:
What helps the rich helps the middle class as 90% of the middle class get their jobs working for the rich.

That was well said and ofter forgotten by people who are jealous of those who are well off…and corporations.

As the old sang goes: “I have never seen a poor person hire anyone!”[/quote]

If you really think that a tax break for the rich, by itself, would make them raise the salaries of the people that work for them (or hire more people), rather than pocket the difference and go to the Caribbean and buy a new yacht there or go to Japan and buy that new 103" plasma TV, you’re either insane, stupid, haven’t met enough rich people – or all of the above.

It’s interesting, however, how Republicans have been so agile at maintaining that absurd perception: every time they reduce taxes, they whip out the Credit Card and simultaneously inject billions of dollars into the economy by exploding Government spending. We call that strategy classic Keynesian economics. Look it up: the ensuing economic recovery is not the result of the reduced taxes, or of a genius, but a predictable response to so much government spending, as modeled by the famous English economist, John Maynard Keynes.

Reduced taxes is not only NOT the driver for the relative economic prosperity we’ve seen under Reagan and the Bushes, it is actually an act of complete fiscal and economic irresponsibility.

By the end of Reagan’s second term the national debt held by the public rose from 26% of GDP (1980), to 41% in 1989, the highest level since 1963. By 1988, the debt totaled $2.6 trillion. The country owed more to foreigners than it was owed, and the United States moved from being the world’s largest international creditor to the world’s largest debtor nation.

Bush II is going the exact same way, having brought the US to an unprecedented level of debt and, as I said in another thread, effectively handing our balls over to the Chinese in a silver platter.

135

[quote]BostonBarrister wrote:
You’re telling me that you’d need more than a couple pecentage points correction upwards to get the approximate share of GDP you want, assuming you got rid of all those exemptions (that would, admittedly, be politically impossible to eliminate)?
[/quote]

You’re repeating yourself so I’ll repeat myself: yes.

I know it’s hard to believe looking at the definition, and I also know you won’t take my word for it, so, again, get the numbers. They’re out there. I guess you’re trying to annoy me enough so I’ll do that myself, but I’d rather have you learn how to find those numbers (hint: start at whitehouse.gov) and do the calculations yourself so I don’t have to keep doing all the work and then be ignored.

And thank you for admitting that eliminating the exemptions would be politically impossible to eliminate. At least we’re in agreement that we’re now talking in the realm of Utopia either way and this is purely an academic discussion.