Annual Tax Rant

[Sam2000]

Originally Posted By: Tempest
Quote:
All Federal, State and Local Govt spending is about $20k per capita. So add up the number of people in your family and multiply it by $20k.

That is a per capita tax, NOT a flat tax. You are trying to confuse the discussion.

Quote:
That's all you are pretty much talking about when you say you want the same % tax for everyone.


The idea is that everyone have skin in the game. If a large portion of the population pays no tax, but a small percent does, then you have a tyrannous situation where the majority will always tend to vote the minority's money into their own wallets. And politicians are more than willing to create generations of dependent people to achieve the power of arbiter.


You still believe that talking point?

Firstly, the number that was quoted was in a year when a recession and some temporary tax relief made it abnormal.

Secondly the majority of people paying no income tax are elderly, unable to work due to disability or students or long term unemployed without work.

You've fixated on the poor like they are a huge problem based on some idiot who represented them as 47% of the population followed up by other idiots who came up with this skin in the game fantasy.

You really need to look at real numbers. Out of $20k per capita of total govt spending, the Feds spend $1k in the welfare category.

We spend $4k on healthcare (a handout for everyone including the rich), $2.6k on military (again non poor people) which is impossible to cut because of jobs and votes.

Since this is per capita, the amount of tax that you personally pay that goes to the poor may be more or less. For most people it will be less.

But out of this $1k per capita that goes to welfare, what proportion goes to people in genuine need vs those you think are not deserving? So if you ended it, how much better would that make things?

I'm all for policies that help the poor raise themselves up. But believing that the amount spent is significant or a problem in and of itself, then you are being distracted from the real issues at the expense of demonizing the poor.

 

[Sam2000]

Originally Posted By: Tempest
Self sufficient people don't need many things from their government so buying their votes with other people's money isn't as easy. Having whole swaths of people stuck on transfer payments for generations makes it much easier.


So your argument applies to the military and Medicare also.

 

[Mykl]

Originally Posted By: Sam2000
Originally Posted By: Tempest
Self sufficient people don't need many things from their government so buying their votes with other people's money isn't as easy. Having whole swaths of people stuck on transfer payments for generations makes it much easier.


So your argument applies to the military and Medicare also.


So people in the military don't provide a service to the country which is to be compensated? Those in the military should work and sacrifice for free?

 

[Tempest]

Quote:
You still believe that talking point?

Talking point? : http://blogs.wsj.com/economics/2012/05/2...tting-benefits/

The long term trend is up.

Social Security and Medicad/Medicare are forms of welfare. They are not savings accounts, and every dime that is collected that is supposed to go these programs is spent every year. What a person has paid has nothing to do with what the government must payout. The Supreme Court has stated people have no right to collect money from these programs even though their pay checks say they have.

And yes, military personal are compensated for their services. Companies are compensated for providing goods.

 

[Vikas]

Seems amusing that people making many hundred K's of dollars (aka rich people) seem to understand that tax system favors them. But people who have not reached that level seem to be more against the poor people than the so called rich. I guess rich don't have AM radio, so they don't get bombarded with the trash talking points all the time.

I bet there is some psychology PhD thesis on that phenomena.

 

[Mykl]

Military benefits are an employer to employee transaction. It is another avenue towards self sufficiency, just because the government is the employer does not mean that it is in any way to be classified as "assistance."

 

[Sam2000]

Originally Posted By: Tempest
Quote:
But studies have shown by quite a margin that tax cuts for the rich have a far far smaller impact than those given to the poor.

I would love to see these studies.

In your previous post you said that "we" are consuming to much, and now you advocate the poor go out and....consume...to help the economy. Which is it?

Quote:
The rich tend to save their money.

People don't get rich by keeping their money in a savings account. They get rich by investing money. The only reason "rich" people save their money is if there is no incentive to invest, i.e. profit. High taxes reduce profit, reduce investment, and reduce job opportunities for other people.


If you're open to the truth, you would know about those studies rather than assume tax cuts are 100% invested. Understanding the multiplier effect is pre Economics 101.

I have a high savings rate and when I receive more than normal, it just adds to my savings. It first goes into a savings account and in time into the stock market. People who are investing in a business typically borrow money. Even if I personally went into business, I would look to borrow and not invest my personal savings unless it was a sure thing.

Me saying we consume too much vs the poor spending tax cuts is not contradictory. They are both observations. You conflating them is disappointing. The poor spend extra money because they do without. Now some people become poor because they spend too much compared to what they earn, but many poor people just don't earn enough. "We" spend too much as a nation as evidenced by our federal deficit and our personal debt. We have a cultural consumption problem hence incentivizing saving is important.

Lastly, most people become millionaires through their saving habits. Nobody said anything about savings accounts but saving what you earn and putting it into reasonable market investments pays dividends over the medium to long term for the average person.

Too many people sound off as if they are owed something for being self sufficient or kept down by taxes or by poor people. Somehow they miss the truth that amongst the poor are elderly and disabled people, low paid hard working people, and elsewhere in the economy are people receiving far far more for things we don't need and damaging the country and economy far far more.

 

[Mykl]

^ you're investing in the stock market and not investing in business?

How?

 

[Tempest]

Originally Posted By: Vikas
Seems amusing that people making many hundred K's of dollars (aka rich people) seem to understand that tax system favors them. But people who have not reached that level seem to be more against the poor people than the so called rich. I guess rich don't have AM radio, so they don't get bombarded with the trash talking points all the time.

I bet there is some psychology PhD thesis on that phenomena.

So asking that people pay an equal percentage of their income (assuming an income based tax system) is "against the poor"?

Please define "poor". Please define "rich". Please define at what income people should start paying taxes.

What is the correct level of "aid"?

What is the correct level of taxes paid to help the "poor"?

What is the correct minimum standard of living that other people should be paying for?

 

[Sam2000]

Originally Posted By: Mykl
Originally Posted By: Sam2000
Originally Posted By: Tempest
Self sufficient people don't need many things from their government so buying their votes with other people's money isn't as easy. Having whole swaths of people stuck on transfer payments for generations makes it much easier.


So your argument applies to the military and Medicare also.


So people in the military don't provide a service to the country which is to be compensated? Those in the military should work and sacrifice for free?


Is the activity they are doing needed? When our military is as big as the next 20 militaries in the world, most of which are allies, you'd have to be naive to think we need a military the size that we have. It's well known that Congress votes for actual hardware that the military said they don't need.

 

[Tempest]

Quote:
Lastly, most people become millionaires through their saving habits. Nobody said anything about savings accounts but saving what you earn and putting it into reasonable market investments pays dividends over the medium to long term for the average person.

Saving and investing are NOT the same. Savings is money not doing anything. "Market investments" is money doing something. You don't get returns on investment for doing nothing.

Quote:
We have a cultural consumption problem hence incentivizing saving is important.

I thought you said poor people are supposed to get out and spend?

Quote:
If you're open to the truth, you would know about those studies rather than assume tax cuts are 100% invested.

I'm open to being enlightened of these studies and in no place have I stated tax cuts are 100% invested.

 

[Sam2000]

Originally Posted By: Mykl
^ you're investing in the stock market and not investing in business?

How?


Another out of context comment.

So when I buy stock, that someone else sells, do I create jobs? That was the original assertion.

You guys have got to stop playing games in your arguments.

 

[Tempest]

Quote:
So when I buy stock, that someone else sells, do I create jobs?

So Wall Street and NASDAQ could close down tomorrow and no one would lose their jobs?

These institutions generate wealth for millions if not billions of people, or there wouldn't be the money involved that there is.

Are retired people better or worse off with investments in stocks? Are the people they spend those gains on better or worse? Would they have jobs without that wealth generation?

 

[Sam2000]

Originally Posted By: Tempest
Saving and investing are NOT the same. Savings is money not doing anything. "Market investments" is money doing something. You don't get returns on investment for doing nothing.


WRONG AGAIN!!!!!

Looks like you don't understand monetary economics either.

When you save in a savings account, you increase the reserve asset ratio of the bank. This means they can lend more. At the moment they are under lending.

Once upon a time, you received interest in savings so there was an ROI.

Some stocks don't appreciate much but provide a dividend. In which case they might give you an ROI similar to a savings account. Maybe less if the stock falls in value.

What you might not have gathered from my posts is that I am actually a job creator and the following is my position on how to create more jobs.

Having looked at the numbers, the poor are NOT the problem. Unneeded military spending is a problem because it is inefficient. Doesn't matter if people are working hard, they are working on something that is not needed so it is pure waste.

The vast majority of medical expense is at end of life and adds no value. The portion that is through Medicare is a transfer payment. I don't want my taxes used for that purpose.

I do want my taxes used to ensure those who can't protect or care for themselves ie the elderly, children, the disabled, are looked after and protected. This is good for society and good for business.

Our lawmakers need to stop enacting bad laws eg the opaque system of employer provided health insurance that hides costs, the poor regulation of Wall St which means we have monopolies that are too big to fail, the corporate governance structure that enables CEOs to override the wishes of shareholders (Listen to Carl Ichan on this topic).

In short, I am against many things that the govt does that distorts market mechanisms and prevents efficiencies. I am for looking after people who need to be looked after and for incentivizing people to work and save.

I think my life as a job creator would be even better and I would be able to create more jobs if we did the above things that level the market, removed market distortions and gave employees and consumers more income.

 

[Sam2000]

Originally Posted By: Tempest
Quote:
So when I buy stock, that someone else sells, do I create jobs?

So Wall Street and NASDAQ could close down tomorrow and no one would lose their jobs?

These institutions generate wealth for millions if not billions of people, or there wouldn't be the money involved that there is.

Are retired people better or worse off with investments in stocks? Are the people they spend those gains on better or worse? Would they have jobs without that wealth generation?


Out of context again.

 

[Sam2000]

Originally Posted By: Tempest
Quote:
We have a cultural consumption problem hence incentivizing saving is important.

I thought you said poor people are supposed to get out and spend?



I did not. I said they would spend. I never said they should.

But the economic models have shown that poor people will boost the economy more than rich people because of how they use their tax cuts.

 

[Sam2000]

Originally Posted By: Tempest
in no place have I stated tax cuts are 100% invested.


I thought you said the rich guy would take his $100 tax cut and create jobs.

What are you saying now? He'd buy a latte first and create jobs with just $95?

 

[Tempest]

So you can create more jobs by having more money removed from you and given to people that are unproductive?

Does this transferring of resources not distort markets and cause inefficiency?

I asked specific questions about the correct level of things for a reason. Namely that there is not a correct answer to any of them. Therefore, any level or definition is strictly arbitrary, and the benefit to society cannot be defined. This fact ensures that wealth transfer payments will be inefficient since a cost/benefit cannot be determined.

I am fully aware of how the factional banking system works. It was not being discussed here and "savings" do not have to be in a bank.

 

[Tempest]

Quote:
But the economic models have shown that poor people will boost the economy more than rich people because of how they use their tax cuts.

I again ask for a cite to this model.

Doesn't taking money from one person and giving it to another distort the economy?

Quote:
Out of context.

How exactly?

Quote:
I thought you said the rich guy would take his $100 tax cut and create jobs.

Please quote a post I made.

 

[javacontour]

Let me see, 20K/capita. Seems high.

300 million people x 20K/person.

300,000,000 x 20,000 = 6,000,000,000,000

Six trillion dollars.

Approximately 2/3rds of that is Federal Spending. I think the federal pie is roughly $4T.

According to this website: http://www.usgovernmentspending.com/piechart_2014_US_fed

The big pieces of that pie are:

Healthcare: 27% (Medicare, Medicaid)
Pensions: 25% (SSI)
Defense: 22%
Welfare: 11% (Looks like WIC, UIC and similar)

The remainder of the federal budget , or about 14% is things like education, foreign aid, transportation, interest on the debt, etc.

So, of the $20K figure you cite, for the typical working family, the cost of the government services for that family, defense, transportation, etc, excluding all the money taken from one and given to another would be on the order of $4500/capita.

When you start looking at all the taxes, not just income taxes, and you include the portion of payroll taxes matched by the employer, I suspect many here are paying way more than their fair share of that $4500/capita.

You can't include the transfer payments, the welfare programs for taxpayers, because those paying the taxes are not benefiting from those programs.

I realize that many of the programs include the elderly. I know this sounds heartless, but frankly, those in charge in the 1930's when many of these things were thought up simply created a program that benefits them, passing the costs on to future generations.

These unfunded liabilities are not likely sustainable. So while many think it's unfair to end these programs, it's also unfair to pass the costs on to generations not even born when the programs were devised.

It's certainly not fair to the following generations for previous generations to collect the funds, and instead of investing them so they would grow, spending them immediately, putting IOUs in "the lockbox" so that future generations would have to redeem the IOUs created by our parents and grandparents.

It's only fair that we would allow the current generation to opt in or out. If you think such a program is a good idea, opt in and pay your taxes. If you don't, opt out with the understanding that such a social safety net doesn't protect you because you chose another route.

Much of this so-called $20k/capita spending is the result of previous generations creating a Ponzi scheme and expecting me, my family and future generations to bail it out.

I wasn't even born when it was devised, so I really feel no obligation to honor obligations made prior to my being of age to vote, let alone be born.

If these programs are such great deals, then let's make them optional and not mandatory by law!

Originally Posted By: Sam2000
Ok, here's another set of numbers for you, especially those who want to keep more and make the poorer pay more.

All Federal, State and Local Govt spending is about $20k per capita. So add up the number of people in your family and multiply it by $20k.

Do you pay more than that? I do but if you don't, you're not paying your fair share - according to your own definition.

Our problem is we waste money. As individuals we waste money and we let our elected officials do the same. We over consume and under think how to do things. We push the limits because a little extra never hurts - the same as our eating habits and look where that has gotten us.

Military spending is ridiculous. Blank checks for non preventative medical care and pharmaceuticals is ridiculous. Providing medicine privately to individuals who don't see or really pay the bill is ridiculous. Having a crazy complicated tax system with all sorts of loopholes for the rich and corporations is ridiculous. Having the highest incarceration in the world where the poor are disproportionately given criminal records for minor offenses which prevents them from voting or getting jobs while private prisons receive quotas is ridiculous.

These are not things that the poor put in place. The system is being gamed by all sorts of people with their own self interest in mind.

And the response here is to tax the poor a little more. Did you even calculate how much extra revenue that would bring in? Well if you look at my numbers, do you really want to take $1500 more from someone getting $12.5k be they retired, sick or a student? How about $2000 from someone getting $25.3k which is below the poverty line?

That's all you are pretty much talking about when you say you want the same % tax for everyone.