The Glade 4.0

http://www.huffingtonpost.com/2012/10/22/americans-savings-500_n_2003285.html
http://www.foxbusiness.com/personal-finance/2014/05/14/median-american-savings-0/

- Less than a third have $1,000 in savings.
- Almost half believe that they'll never be capable of saving money at all.
- Over two thirds say that having a paycheck delayed by a week would be "somewhat difficult" or "very difficult."

And, yet, you support all sorts of measures that would further impair people's ability to save.

Eliminating income taxes would be a good start; switching to a flat income tax at 10% with no deductions and eliminating Federal VATs and regulatory taxes would be even better ...; or, better yet, switching solely to a Federal consumption tax scheme would be best.

But none of that's going to work when our government maxes out credit cards like a Middle Class teeny bopper at State College.

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How would eliminating or flattening income taxes help when most Americans don't pay any net income tax as it is? Isn't a VAT a consumption tax already? And how would consumption taxes not impair the ability to save - it's an added cost taking away from the amount available for saving. Sure, it might pressure people to save rather than consume, but it's still an impairment of their ability to do so. I thought you were opposed to using tax policy to coerce behavior the government thinks is "for our own good"?

Economic Recovery! Eff yeah!

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Even if they have a net-negative tax burden under current taxation schemes, they still lose access to that money until the following calendar year. That money isn't saved so much as held in limbo until inflationary and other modulating pressures devalue the money the government has held. Our tax scheme is based on our gigantic Federal government's cash-flow needs, not any actually sustainable method of taxation, particularly since the U.S. Federal government uses a predominantly Zero-Sum accounting matrix.

Consumption taxes and other VATs are only applicable if you spend the money on the appropriate goods. Eliminating those things people must have to survive: energy, food, water, housing, and clothing from consumption tax possibility means people get to spend less on those items and save more. More to the point, a flat Federal VAT on everything that's not those 5 product sectors, would be already break even on Federal tax revenues, and that's if you trust the BOL on their numbers. In reality, since those 5 product sectors account for about 80% of all dollars changing hands in the United States on a daily basis, it would increase Federal revenues while lowering effective tax rates across the board.

And, I get that you're pretty liberal, RangerDave, but here's a fact your politics don't like:

Roughly 90% of all Federal personal income tax revenues were paid by 50,000 people last year. The other 344,950,000 million Americans fought to pay that last 2.7 billion.

But, you know, we can keep raising income tax rates, further marginalizing laborers from the product of their labor. Income taxes, especially with front-end withholding, means you cannot leverage your actual income within the economic engine of the United States. The Federal Government somehow feels entitled to the fruits of your labor, as if you own it for services it is not, cannot, and will not provide. Thus, we face the horrible social outcomes of the welfare state.

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The government should give everyone who doesn't have a job a savings account....

Oh boy, another one of these claims. You know, I'm pretty sure the federal government collected more than $27 billion in income tax revenues last year.

They collected 2.7 trillion. Forgive me for being lazy, and not really thinking about what 10% of that was.

And, yes, the top 50,000 tax payers in the United States pay nearly 90% of the actual income taxes collected. The false claims come from your side of the fence, which think the rich don't pay their fair share, because they view tax revenues as somehow representative of income inequality in the United States.

And, to be perfectly honest, there are only about 90 million tax payers in the United States total. Between credits, deductions, etc., around 50% of people eligible to possibly pay taxes don't have to. You really underestimate how broken this nonsense is in the United States.

http://en.wikipedia.org/wiki/Progressiv ... income_tax

But, we can use 2008 numbers from Wikipedia to make my point: the IRS claims the top 5% of earners paid 59% of taxes in 2008. That's 9 million people if I want to be really generous.

The bottom 50% of earners paid 3% in 2008.

Do you honestly think the rich don't pay their fair share? Because, I can tell you middle class only paid 38%, and that's 45% of the population.

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The top earners pay more taxes, yes, but when you also consider payroll and capital gains taxes, it's nowhere near as lopsided as you claim. The middle quintile pays an average of 13% of their gross income to income, payroll, and capital gains taxes. The second quintile pays 16%, and the top quintile pays 20%. The richest 500 people in the US pay a lower percentage than the second quintile.

The wealther you get, the more of your income tends to come from capital gains, interest income, and dividends, which are only taxed at 15%. In his Presidential campaign Mitt Romney admitted that he only paid 13% in taxes, despite being in a race where he had every incentive to exaggerate his tax liability.

Also, you have proposed eliminating capital gains taxes many times. If we were to do this the tax liability of "the 1%" would be around 10%, lower than everyone except for the bottom quintile. It gets even worse if we consider the employer portion of the payroll taxes as part of the employee's gross income, in which case the rich are paying a lot less than almost everyone else.

No, they're still paying quite a bit more. 10% of 500,000 is far more than 16% of 50,000.

The rich pay much more in taxes but have to endure the same public services as everyone else. It is actually an unfair system towards the rich. If you pay 10x towards public roads, for example, logically you should get a special-access fast lane on highways. But instead you get stuck in the same traffic as someone who pays no taxes.

.....that's totally irrelevant unless you want to suggest a tax system where everyone pays the same flat dollar amount.

The bottom quintile of American taxpayers have a net-negative tax burden; they get more money back from the government than people who make between 35 and 50k a year on average owe. How 0% or -6% higher than 10%, Xequecal? Seriously, the bottom two quintiles paid 3% of American taxes in 2008.

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It's not in any way irrelevant when some is making the incredibly stupid argument that rich people don't pay "their fair share".

Xequecal:

The Top Quintile, per your numbers, pays 20% of their income in taxes.

The Second Quintile, per your numbers, pays 16% of their income in taxes.

Also, I know it doesn't affect you ever, but there is this thing called the Alternative Minimum Tax, which will shunt you to a flat 39.6% if you aren't careful. No gradation either, there ...

The taxes become strictly 39.6% of the income subject to the AMT.

Please, stop spewing this nonsense that they need to pay over more of their income, because I can assure you pretty much every other bracket pays less of their income in taxes as a percentage of total income.

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The mantra of "fair share" is a religious conviction Khross and we should remember that "fair" is always determined by the person saying the word.

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"...but there exists also in the human heart a depraved taste for equality, which impels the weak to attempt to lower the powerful to their own level and reduces men to prefer equality in slavery to inequality with freedom." - De Tocqueville

I pulled those numbers from your own link, it clearly shows the "top 400" as paying less than the top quintile, and only slightly more than the second quintile on average. The top 400 pay less than almost 40% of the country. It's not like the people in this group are even bothering to dispute this, everyone knows about Warren Buffet's claims of how he pays less taxes than most people and Mitt Romney admitting he only paid 13% in the year he was running for President.

I don't dispute that rich pay more in general, but the fact remains that the top 5% pay 60% of all the taxes because the top 5% have more than 60% of all the money to begin with. In addition, a progressive taxation scheme of 10% to 20% (the bottom quintile doesn't have any money to take) is hardly some kind of gross injustice. You could live in Europe and be paying 70% to fund a social safety net that you will never use, would the fact that the factory workers are also paying 60% make you feel better about it?



Like I said before, it's a totally irrelevant red herring unless you're advocating for everyone paying a flat dollar amount in taxes. The tax system is going to be based on a percentage of something and if you want to get rid of things like capital gains taxes you need to show why the richest of the rich should pay a lower percentage than two thirds of the country.

You're overstating when you say it's totally irrelevant, Xeq. My annual income is roughly 9 times that of my younger brother's. If he and I both go in on a $100 gift for our parents, and I pay $90 and he pays $10, we've each contributed the same percentage of our income, but he's not really going to feel like the gift is just as much from him as it is from me.

Xequecal:

Warren Buffett's income is almost entirely investment derived. In fact, I believe his salary at Berkshire Hathaway is completely token and immaterial. He paid 20% on all long term capital gains that were realized in 2013. He paid 3.8% in addition to that 20% as a new Medicare/Medicaid/FICA Tax on ALL investment income last year. He paid 39.6% on all short term capital gains and full Medicare/Medicaid/FICA on those gains.

And then there's the whole AMT situation, for which only certain investment incomes are exempt. Truth is, Warren Buffett only knows what his net tax rate is, and he buys a lot of that with a ludicrous amount of charitable giving.

Seriously, he has accountants who figure out how much the check is. He knows, loosely, what he capitalized in a given year. He also knows how much he gave to charity.

Stop trying to say he pays less of his actual income in taxes than you, because he doesn't.

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