Romney Will Explode the Debt By Trillions

[Peephole]

Good news then. Most of the tax burden disproportionately falls on the rich. Nearly half of all people don't pay income tax. Time to flatten out the rates so that they are a bit more equitable.

Lie.

• The 51 percent and 46 percent figures are anomalies that reflect the unique circumstances of the past few years, when the economic downturn greatly swelled the number of Americans with low incomes. The figures for 2009 are particularly anomalous; in that year, temporary tax cuts that the 2009 Recovery Act created — including the “Making Work Pay” tax credit and an exclusion from tax of the first $2,400 in unemployment benefits — were in effect and removed millions of Americans from the federal income tax rolls. Both of these temporary tax measures have since expired. In 2007, before the economy turned down, 40 percent of households did not owe federal income tax. This figure more closely reflects the percentage that do not owe income tax in normal economic times.[4]

• These figures cover only the federal income tax and ignore the substantial amounts of other federal taxes — especially the payroll tax — that many of these households pay. As a result, these figures greatly overstate the share of households that do not pay federal taxes. Tax Policy Center data show that only about 17 percent of households did not pay any federal income tax or payroll tax in 2009, despite the high unemployment and temporary tax cuts that marked that year.[5] In 2007, a more typical year, the figure was 14 percent. This percentage would be even lower if it reflected other federal taxes that households pay, including excise taxes on gasoline and other items.

• Most of the people who pay neither federal income tax nor payroll taxes are low-income people who are elderly, unable to work due to a serious disability, or students, most of whom subsequently become taxpayers. (In years like the last few, this group also includes a significant number of people who have been unemployed the entire year and cannot find work.)

• Moreover, low-income households as a group do, in fact, pay federal taxes. Congressional Budget Office data show that the poorest fifth of households paid an average of 4.0 percent of their incomes in federal taxes in 2007, the latest year for which these data are available — not an insignificant amount given how modest these households’ incomes are; the poorest fifth of households had average income of $18,400 in 2007.[6] The next-to-the bottom fifth — those with incomes between $20,500 and $34,300 in 2007 — paid an average of 10.6 percent of their incomes in federal taxes.

• Moreover, even these figures greatly understatelow-income households’ totaltax burden because these households also pay substantial state and local taxes. Data from the Institute on Taxation and Economic Policy show that the poorest fifth of households paid a stunning 12.3 percent of their incomes in state and local taxes in 2011.[7]

• When all federal, state, and local taxes are taken into account, the bottom fifth of households pays about 16 percent of their incomes in taxes, on average. The second-poorest fifth pays about 21 percent.[8]

http://www.cbpp.org/cms/index.cfm?fa=view&id=3505

 

[lomiller]

Which has nothing to do with the fact that 50% of the people pay no federal income tax

The we agree, the fact that 50% of people pay no federal income tax is irrelevant to the discussion at hand.

that the wealthy pay a disproportionate share.

You have done nothing to support this assertion. As I said above if the wealth were paying a disproportionate share their wealth would be declining relative to lower income brackets not growing.

 

[lomiller]

classical Marx statement, that the wealthy should pay disproportionately more

"to each according to his need" implies there are no wealthy or poor so how can this be a statement mean the wealthy should pay disproportionally more?




Progressive tax rates come from a completely different school of thought. Not only that the school of thought they come from firmly rejected Marx's idea's.

 

[Peephole]

The growth of income, loss of income, etc. doesn't change the fact that the top earners pay a disproportionate share of the taxes.

The estimated optimal tax rate of high-income earners is something close to 70% of income, which the rich in the US aren't even close to. So yes, top earners do not pay a proportionate share of taxes, they pay way too little.

 

[BenBurch]

The estimated optimal tax rate of high-income earners is something close to 70% of income, which the rich in the US aren't even close to. So yes, top earners do not pay a proportionate share of taxes, they pay way too little.

I'd settle for 60%, but they have to stop being parasites.

 

[lomiller]

The estimated optimal tax rate of high-income earners is something close to 70% of income, which the rich in the US aren't even close to. So yes, top earners do not pay a proportionate share of taxes, they pay way too little.

Link doesn't work. Do you mean optimal in terms of how much tax you would collect? If so I'm not sure that's any more useful than Nelly's opinion as a basis how much tax people *should* pay.

IMO taxes should mainly target disposable income, as most of the services those taxes pay for bring less value than day to day necessities like food, water, sanitation, shelter etc. If you don't have these basics then you don't give a damn about funding for the military.

Given a choice you would prefer to eat than pay for these government services, it's only people who can already afford the basics who receive value for these additional services so it's only reasonable that they would be the ones to pay for them. A family of 4 making $50 per year disposable income is pretty close to zero and the income tax they pay should reflect this.

 

[Corsair 115]

The politics forum, where Skepticism goes to die.

While I concur with your observation, I am curious as to who, if anyone, you are singling out in this thread as fitting it.

 

[Cain]

The ideal scenario would be for people to pay according to what government services they consume. Since there is no practical way to do this, a flat income tax or sales tax seems to me the most fair way to handle it. But do suggest alternatives that you might have.

Government services are like insurance; it's better to pay for them and not use them.

As for an alternative: a progressive consumption tax.

 

[Belz...]

That sounds like a rational approach, "pay 'till it hurts".

Strawman, slippery slope, non sequitur.

Read my post again.

I seriously don't see your beef with all this. A flat rate hurts poor people and makes them poorer. I don't think most people want that. A growing, thriving middle class is much more desirable.

On the other hand, the rich can handle a much greater tax burden without ill effects on their quality of life. Is it really that bad if they can't afford that fifth yacht ?

 

[Belz...]

[*]Charging the poor more won't really help the rich. In fact there is good reason to believe it will hurt them.

Yes, that's worth mentioning.

 

[Belz...]

Which has nothing to do with the fact that 50% of the people pay no federal income tax and that the wealthy pay a disproportionate share.

Are you going to admit that there are other taxes that they pay ?

 

[BenBurch]

Yes, that's worth mentioning.

Yes. It's like killing the goose that lays the golden eggs.

Lets play reductio ad absurdum for a moment. Suppose the there was on man, named Kroisos, who was the wealthiest man in his nation. He buys lots of votes, and soon he is paying no tax at all, and everybody else is paying a 90% tax.

The government is funded just fine, but businesses collapse everywhere because nobody has any money to spend.

Soon, poor Kroisos cannot buy anything at all with his money because there is no production and he winds up just as materially-poor as everybody else because he has made money valueless.

 

[Neally]

Lie.

Your citation does not dispute the facts of the IRS and congressional committees. It is not a "lie". It merely tries to spin the embarrassing data to the left, "Yet these figures, their significance, and their policy implications are widely misunderstood."

The we agree, the fact that 50% of people pay no federal income tax is irrelevant to the discussion at hand.

My point has and continues to be that the wealthy already pay a disproportionate share of federal income taxes. That fact is supported by IRS data.

You have done nothing to support this assertion. As I said above if the wealth were paying a disproportionate share their wealth would be declining relative to lower income brackets not growing.

The growth or decline of wealth is not the criteria of paying a disproportionate share.

"to each according to his need" implies there are no wealthy or poor so how can this be a statement mean the wealthy should pay disproportionally more?

Huh? There is no such implication.

Progressive tax rates come from a completely different school of thought. Not only that the school of thought they come from firmly rejected Marx's idea's.

The rationale is very much the same. Take more, tax more from those that have it, can afford it.

I seriously don't see your beef with all this. A flat rate hurts poor people and makes them poorer. I don't think most people want that. A growing, thriving middle class is much more desirable.

ANY tax makes ANYONE poorer. The fair thing to do though is for everyone to help pay for the cost of running the government through income taxes.

On the other hand, the rich can handle a much greater tax burden without ill effects on their quality of life. Is it really that bad if they can't afford that fifth yacht ?

Yet another perfect example of Marx's ""From each according to his ability, to each according to his need". Who again claimed no one made any such implication?

Are you going to admit that there are other taxes that they pay ?

I've never denied it. That doesn't change the fact about 50% of the people pay no federal income tax.

 

[DavidJames]

My point has and continues to be that the wealthy already pay a disproportionate share of federal income taxes.

Welcome to modern civilized society. If you're looking for Libertopia, check Somalia or a similar country.

 

[RandFan]

RE: Communism.

The rationale is very much the same. Take more, tax more from those that have it, can afford it.

Communism would not permit a wealthy business person to keep most of his or her assets. To equate taxation in a capitalist economy with communism is intellectually dishonest.

 

[RandFan]

Which has nothing to do with the fact that 50% of the people pay no federal income tax and that the wealthy pay a disproportionate share.

Are you going to admit that there are other taxes that they pay ?

It's inconvenient to his cause.

 

[Belz...]

ANY tax makes ANYONE poorer.

Anyone but not everyone, since everyone benefits. Second, as stated earlier, it hurts the poor MORE.

The fair thing to do though is for everyone to help pay for the cost of running the government through income taxes.

How is it fair to ask dirt-poor people to become even poorer ? If they are instead richer, they can spend on stuff and make the economy work. Making rich people richer only encourages them to stow the money away.

Yet another perfect example of Marx's ""From each according to his ability, to each according to his need". Who again claimed no one made any such implication?

No one has mentionned Marx here except you. If I were filthy rich, I'd have no problem paying a higher proportion to help my fellow citizens. In fact, _I_ already pay a higher proportion than most because of my income.

I've never denied it. That doesn't change the fact about 50% of the people pay no federal income tax.

If you don't deny it then why mention it at all, unless you're trying to make it sound as though they are not contributing to the government's own income, which is not true ?

 

[Belz...]

Communism would not permit a wealthy business person to keep most of his or her assets. To equate taxation in a capitalist economy with communism is intellectually dishonest.

But to do anything else wouldn't fit with their black-or-white views.

It's inconvenient to his cause.

To be fair, he did admit it.

 

[lomiller]

The growth or decline of wealth is not the criteria of paying a disproportionate share.

I disagree. In fact it is the best way to evaluate this because it encompasses a wide range of factors like diminishing returns on the value of money (the more you have the less valuable a given amount is to you) and disposable income.

I note that you continue to just state your position without building up an argument for it. Perhaps you should start with telling us how you are defining “disproportionate”. It seems to me you think disproportionate is anything but everyone but a flat tax rate which is unworkable.

The rationale is very much the same. Take more, tax more from those that have it, can afford it.

And you would prefer to collect taxes from people who can’t afford it? That doesn’t seem workable to me.

Optionally you could eliminate the programs income tax pays for, which is primarily defence. Are you perhaps in favour to the US eliminating it’s military and defence related programs like homeland security, boarder patrol, the VA, etc?

Yet another perfect example of Marx's ""From each according to his ability, to each according to his need".

Again, no. You are simply incorrect. Progressive tax rates have nothing to do with Marx.

In fact if we use an insurance analogy your position translates into the belief that everyone should pay the same for house insurance no matter what kind of house they have since they all need house insurance so they should all pay the same amount. This sounds a lot like “each according to his need” comrade...

 

[IchabodPlain]

The ideal scenario would be for people to pay according to what government services they consume. Since there is no practical way to do this, a flat income tax or sales tax seems to me the most fair way to handle it. But do suggest alternatives that you might have.

Can you elaborate on what such a sytem would look like? How would defense be treated? You want the unemployed to pay for their unemployment benefits? Would it be like some sort of loan?

That sounds like a rational approach, "pay 'till it hurts".

All taxes hurt - i.e. red herring on your part. But who is hurt least: 20% of $20k or 30% of $2M?

Also, to drudge up Marx is not only dishonest (he wasn't referring to income taxes), but ignores that countless economists have argued for progressive taxation. You're seeking to poison the well. It's childish.