Why we need a flat tax.

[ManusJustus]

HappySqurriel said:

ManusJustus said:

HappySqurriel said:

Do you have problems with understanding someones argument and responding to it appropriately? What is so hard to understand about this:

"when taxes are low enough that companies thrive and unemployment is low the low wage earners have far more power to demand more equatible incomes because the companies cannot operate without their work."

If you insist on always increasing taxes on the top 5% of income earners to what extent do 95% of people have on keeping control on government spending?

the economy is better when the tax burden of everyone is minimalized to only cover the services that the government can provide more efficiently than the private sector.

Why can't people look at Seattle'slight rail transit system...

Wage earners dont demand more income, their income is decided by the free market.  It doesnt matter if you tax a company $100,000 or $1, if the free market values a software engineer at $60,000 a year that is how much he is going to make.

The government has to provide Seattle's light rail system because it the free market would never provide such a service.  There are public goods and private goods, and it so happens that the government is more efficient at providing public goods and the market is more efficient at providing private goods.  This is a simple economic fact, and if you think otherwise I ask you how efficient do you think the army would be if they depended on the free market to provide them with finances, or if you'd like paying a toll booth at every street corner?

Your idea that making people pay more or less taxes will change how they view government spending is a huge and incorrect assumption.  If someone pays $4,000 in taxes and you increase that to $5,000, a light bulb isnt going to flash in their head and change their view on government spending.

I think you have a massive lack of understanding how the free market works ...

If you have a certain number of companies, who each require a certain number of employees who have a certain skill set, then depending on the quantity of people with that skillset relative to the number demanded determines a person's wage...

If companies have more money on hand they tend to use this money to grow their business, which means they need more employees with a variety of skills to perform the research and development, production, distribution and marketing of their good; as well as a larger number of supporting staff to look after the running of their business. As the economy becomes better and better the number of jobs available becomes greater than the available workforce and companies are required to pay higher wages for the same job to attract potential employees.

Locally, I have seen this happen when companies had to put up (large) signs on the side of the road to inform people that they could earn $22 per hour to stock shelves after hours at stores. I have seen companies agressively promote low level employees from "The Mail Room" or "The Loading Docs" to take on higher paying office jobs without any (appropriate) experience because they needed someone to fill that position.

 

No private industry would build Seattle's light rail transit system because the ridership is awful because it is designed to fill a need that no-one has. Now, when you spend (at least) 10 times what a private company could produce something, and there is no interest in it because it offers such little value, why would you assume that it was delivered efficiently?

Thats exactly what I said by "the free market decides wages by labor supply and demand" without going into detail.

Companies grow based on how profitable it is to grow.  If a rich businessman's company has maximized profits, giving him a tax break will not give him an incentive to hire more employees.

There is a demand for mass transit.  Unfortunately for America, the free market (automobile industry) destroyed America's light rail system to make cars more profitable.  Ford actually set up a puppet company to buy light rail companies and replace them with inefficient bus systems, pusing people to choose cars as their means of transport, and the head of America's Transportation Cabinet was a former Ford CEO so he had no problem with this.  The problem is that with high gasoline prices and congested roadways, there is an increasing demand for light rail and the cost of rebuilding light rail after it is already gone is huge.

Light rail may sound costly now, but its worth the price when you consider increasing energy costs and road congestion that will greatly increase demand for light rail in the future.  Its kind of like the story of Noah's Ark, everybody thought it was silly until it started raining.