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Forums - General Discussion - Tax discussion thread (U.S. focused)

I'm about to go to work, so let me just say the top thing in my mind regarding this:

Do you feel that your idea that the value of money to people is relative on a flat ratio is more likely to be correct than my idea that it is relative on a scaling ratio? If so, do you have evidence supporting this position?



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Final-Fan said:
I'm about to go to work, so let me just say the top thing in my mind regarding this:

Do you feel that your idea that the value of money to people is relative on a flat ratio is more likely to be correct than my idea that it is relative on a scaling ratio? If so, do you have evidence supporting this position?


I think there is little support to either.... nor is there a way to support either... and furthermore it's generally irrelvant... and a lot of it based on personal beliefs, etc.

Instead things should be based off of what we know.  Such as...

A)  Money is how we value things.

B) People are paid hourly for their work.

Ergo, people who are paid more are doing more valued work.

I see no reason to think these people aren't entitled to the money they make... when everyone is taken care of needs wise.

 



First off, I'm not aware that (B) is generally true when you get to the high income brackets. Secondly, I believe that people in highly paid positions are more likely to be able to "game the system" to give them higher salaries. I don't know how else a CEO can make over a hundred million dollars per year.
http://money.cnn.com/2005/08/26/news/economy/ceo_pay/
http://money.cnn.com/2004/11/24/commentary/everyday/sahadi/index.htm

People are entitled to the fruits of their labor, true. But how much fruit can a person really eat? I think it's fair to take higher percentages from relatively very high incomes even after compensating for the cost of bare necessities, because of the diminishing returns of practical usefulness of money. But the point is a bit moot since we don't have such a system in place (of compensation).



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My advice to fanboys: Brag about stuff that's true, not about stuff that's false. Predict stuff that's likely, not stuff that's unlikely. You will be happier, and we will be happier.

"Everyone is entitled to his own opinion, but not his own facts." - Sen. Pat Moynihan
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Final-Fan said:
First off, I'm not aware that (B) is generally true when you get to the high income brackets. Secondly, I believe that people in highly paid positions are more likely to be able to "game the system" to give them higher salaries. I don't know how else a CEO can make over a hundred million dollars per year.
http://money.cnn.com/2005/08/26/news/economy/ceo_pay/
http://money.cnn.com/2004/11/24/commentary/everyday/sahadi/index.htm

People are entitled to the fruits of their labor, true. But how much fruit can a person really eat? I think it's fair to take higher percentages from relatively very high incomes even after compensating for the cost of bare necessities, because of the diminishing returns of practical usefulness of money. But the point is a bit moot since we don't have such a system in place (of compensation).

Even those who aren't paid hour are paid what they are valued at however.

As for "how much fruit can a person eat."

That seems irrelevant.  How much money can a person spend.  People have often asked me why i bought a playstation 3 because "How many games systems can i really play?"

Even if can't play them all. (though I can.)  Don't I have a right to collect videogames?

Legislating on a "what can they really use?" basis sets a dangerous precedent.

I mean... Evander Hollifield has a 100 room house.  He can't possibly use all those rooms.  Should the government allow someone to move into a few rooms near the back of his house?

Laws need to be transparent,  easy and fair to prevent abuse.



Your Hollifield "slippery slope" argument is an entirely other level of government intrusion. More like "eminent domain"! My "fruit" comment is clarified by the following sentence.

Transparency isn't a problem, nor is easiness (I mean inherently, not our actual current system); and "fairness" is the matter of opinion that we have been discussing.



Tag (courtesy of fkusumot): "Please feel free -- nay, I encourage you -- to offer rebuttal."
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My advice to fanboys: Brag about stuff that's true, not about stuff that's false. Predict stuff that's likely, not stuff that's unlikely. You will be happier, and we will be happier.

"Everyone is entitled to his own opinion, but not his own facts." - Sen. Pat Moynihan
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Final-Fan said:
Your Hollifield "slippery slope" argument is an entirely other level of government intrusion. More like "eminent domain"! My "fruit" comment is clarified by the following sentence.

Transparency isn't a problem, nor is easiness (I mean inherently, not our actual current system); and "fairness" is the matter of opinion that we have been discussing.

I disagree... afterall why stop at money?   What makes money after being spent so different.

Aside from which though.  By transparency and easiness i mean by reasoning.

If you use a "how much can they really spend" arguement.... there is no transparency there.

Just a random vague "some amount" that can be gradually increased and decreased at will.

That's one of the reasons politcians love the progressive tax system.  Less people get upset over a tax one group then all.  Rather then a tax raise on all... with no ratios and values, you lead yourself to a lack of transparency letting people keep raisng the tax for whatever reason... and then other taxes one by one... to feed wasteful government programs.

If we had a flat tax do you really think we'd have as many wasteful government programs?  No way.  The majority wouldn't stand for it because ALL of their taxes would be raised.  It's the same premise behind how the government gets away with "Sin taxes".  Tax the smokers?  Sure I don't smoke.... and I get the benfits of taxing them!  Win win!


Do you at least agree that any progressive tax should have a fixed ratio?  In which once set down, tax raises would have to be across the board to all tax paying citizens. (which would be all in the case of a system where all needs are taken care of.)

With any change in ratio having to be met by a higher standard then usual congress voting.  (For example maybe the 3/4th rule that John McCain wants.)

 



Kasz216 said:
Final-Fan said:
Your Hollifield "slippery slope" argument is an entirely other level of government intrusion. More like "eminent domain"! My "fruit" comment is clarified by the following sentence.

Transparency isn't a problem, nor is easiness (I mean inherently, not our actual current system); and "fairness" is the matter of opinion that we have been discussing.

I disagree... afterall why stop at money?   What makes money after being spent so different.

Aside from which though.  By transparency and easiness i mean by reasoning.

If you use a "how much can they really spend" arguement.... there is no transparency there.

Just a random vague "some amount" that can be gradually increased and decreased at will.

That's one of the reasons politcians love the progressive tax system.  Less people get upset over a tax one group then all.  Rather then a tax raise on all... with no ratios and values, you lead yourself to a lack of transparency letting people keep raisng the tax for whatever reason... and then other taxes one by one... to feed wasteful government programs.

If we had a flat tax do you really think we'd have as many wasteful government programs?  No way.  The majority wouldn't stand for it because ALL of their taxes would be raised.  It's the same premise behind how the government gets away with "Sin taxes".  Tax the smokers?  Sure I don't smoke.... and I get the benfits of taxing them!  Win win!

Do you at least agree that any progressive tax should have a fixed ratio?  In which once set down, tax raises would have to be across the board to all tax paying citizens. (which would be all in the case of a system where all needs are taken care of.)

With any change in ratio having to be met by a higher standard then usual congress voting.  (For example maybe the 3/4th rule that John McCain wants.)

Once again you've confused income tax with a direct wealth tax.  Not to mention the fact that it's not even seizure of specific property (as a totalitarian wealth tax might) but government USAGE of that property while it's still in his possession!  (At least, you didn't say it wasn't, and I don't see how the gov't would take a few rooms of a mansion.)  All in all I don't see how your example is anything less than completely absurd and totally irrelevant to what we were discussing. 

My "how much can they really spend" argument can be backed up by studies that will show a general trend of diminishing returns on the practical usefulness of money, and that trend's proportions.  I just don't happen to have that knowledge. 

You might be right about the consequences of a flat tax.  But then again, maybe not.  People haven't been rational about voting for tax cuts on the rich, why should they be rational about tax hikes on themselves?  And maybe they'll approve because they think it'll steer more government largesse to their locale than they pay extra in taxes, etc. etc.  Or maybe it'll just create HUGE new pressures to not raise taxes while people still want more government programs, increasing the pressure to add deficit spending we've done too much of already. 

I can't think of a reason off-hand why we shouldn't fix the progressive tax brackets' percentages at certain ratios (presuming we could be pretty sure of having the best possible ratios). 

3/4 is a ridiculous supermajority, though.  That's as hard as a constitutional amendment!  2/3 majority is more than enough and I'm not certain I support that either, but I'm not as opposed to it. [edit:  removed nonsense]  (Could you please tell me your source?  I didn't see it in his campaign economic briefing PDF.)  



Tag (courtesy of fkusumot): "Please feel free -- nay, I encourage you -- to offer rebuttal."
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My advice to fanboys: Brag about stuff that's true, not about stuff that's false. Predict stuff that's likely, not stuff that's unlikely. You will be happier, and we will be happier.

"Everyone is entitled to his own opinion, but not his own facts." - Sen. Pat Moynihan
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
The old smileys: ; - ) : - ) : - ( : - P : - D : - # ( c ) ( k ) ( y ) If anyone knows the shortcut for , let me know!
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Can't say i remember the exact place. Maybe it wasn't 3/4ths and i just remember the number wrong. Been a while.

Also, would you care to show a link to said studies?  I can't find any.

Nor do i still understand how such a thing could be after the basics are taken care of... and how such a thing is being measured.  (A flawed one person model or somthing else.)

While diminishing returns is true on some things.  It isn't true in all things.

Many proffessions and other things actually give you increasing returns for having more money.

Furthermore i'd have to ask if it was relevant.

You miss the Hollifield arguements point.  In the same way.  He has way more then he could use.  His house also falls under "diminishing returns".

People who get fat go over "diminishing returns" when eating.

Why is it the governments buisness to suddenly worry about this only when it has to do with income?

With a "Government knows when you are making too much" mentality who knows what's next.   I mean we already have Social security, the department of education and tons of government programs where the government thinks it knows best, but instead have just created huge problematic bueracracies.

 



My point was that (as I've said before) even if I cannot point to such studies (and I can't currently), that doesn't mean they cannot be found or created, so your argument that a progressive income tax is necessarily founded on fuzzy rhetoric is not true. Sorry about being unclear about that and if that's not what you meant, then never mind.

If such a (definitive, nonpartisan) study was conducted and found that the top 100,000 was just as useful to a person making 1,000,000/year as the top 1,000 was useful to a person making 10,000/year [edit: above bare survival income for both], then I would change my tune.

I agree that Hollifield's housing has hit diminishing returns, but you forget that we're not talking about a direct wealth tax or any other tax but an INCOME tax and you also seem to have missed the other objections to your example I mentioned.

The REASON I favor an income tax (and why are we suddenly back to this subject? just curious) I have stated before: direct wealth taxes on the living unjustly impact those with little or no income but who still have substantial assets (e.g. retirees).

I'm slightly confused by your closing paragraph, since we've had a progressive income tax for almost a century. I would think that most of the consequences would have manifested by now and the ones that haven't ought to be forseeable. Why the doomsaying?  ("Who knows what's next?")  Also, I could argue with your apparent premise that Social Security is a bad idea, but I'd rather not move so clearly beyond the scope of the thread when we still have so much ground to cover on topic.



Tag (courtesy of fkusumot): "Please feel free -- nay, I encourage you -- to offer rebuttal."
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My advice to fanboys: Brag about stuff that's true, not about stuff that's false. Predict stuff that's likely, not stuff that's unlikely. You will be happier, and we will be happier.

"Everyone is entitled to his own opinion, but not his own facts." - Sen. Pat Moynihan
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
The old smileys: ; - ) : - ) : - ( : - P : - D : - # ( c ) ( k ) ( y ) If anyone knows the shortcut for , let me know!
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Such problems already have manifested.

Such as Property tax. Which is a wealth tax.

You support Estate taxes. Isn't that a wealth tax?

Even sales taxes, sin taxes and luxuary taxes are quasi-wealth taxes.