Flat Tax and Tithing

[colton]

Colton, what should be changed, then? What is the "fair" amount that should be taxed for different levels? Why exactly is it harder for the $10k earner to pay 10% and how do you quantify that? Is it easier for the $100k earner to pay $30k in taxes than for the $70k earner to pay $1k?

I don't have time to reply to most of this, sorry. But to address the question in bold, it's because of discretionary income (or lack thereof). The $10K earner has a much larger fraction of his/her income that goes to the necessities of life such as basic food, basic clothing, basic shelter, basic health care. Maybe there are other basics I'm forgetting. So charging that individual a lower percentage of income tax seems just, to me.

 

[colton]

I agree. My simplistic idea to make it more "fair" (I guess) is to make the first $20 to $30k for everyone tax free, and then have a flat tax on the amount made after that.

I'm sure there are hundreds of economists who have some sort of problem with that idea, but to me it seems pretty fair.

Yes, that's kind of what I was getting at with my last post (written before I read this post of yours). There may be better solutions, but that idea at least is easy to understand, would close most of the loopholes, and seems like it would be easy to implement.

 

[The Pearl]

Neither party wants a flat tax and neither party wants any meaningful tax reform. The tax code is not designed to be fair or designed to raise the "correct amount" of revenues to fund government activity. The tax code is a psychological weapon used by the parties to work people up into an emotional frenzy so that they can secure votes under the guise that they will address the problem.

The level of marginal rate debate is built on a complete fallacy, that fallacy being that there is a certain percentage of the wage earners not paying their "fair" share, hence because of this, the poor are getting shafted. Therefore if we simply raise rates on the high wage earners, the poor will somehow magically become wealthy. Of course left out of this complete nonsense is that there is no mechanism offered by Congress and no plan to specifically route the increased revenues into a mechanism by which this can possibly take place. It is a total con job by the political left. The increased revenues simply flow to the US Treasury and are lost in the black hole of government appropriations. It is nothing more than feel good accounting gimmickry. A simple analogy is lawfully mandating that the well off family cut up their steak dinner and throw half in the trash. They are less satisfied, but the homeless guy on the corner is still starving to death.

Poor people have a problem. Their revenue stream is sub-standard. It can only be increased essentially by two ways. They either must bring home bigger paychecks or receive bigger government transfers. That is it.

The simple fact is that we are being manipulated into a false debate about a solution for a problem that it can't fix. The solution to poverty is very simple, pension funds have been doing it for years in that you simply "liability match". In this case, you simply tax whoever has the money and make direct payments to the people who you deem poor and at a level you believe brings them out of poverty. Problem solved.

Neither party wants to solve poverty anymore than Reverend Al wants to eradicate racism.

 

[PearlWatson]

Neither party wants a flat tax and neither party wants any meaningful tax reform. The tax code is not designed to be fair or designed to raise the "correct amount" of revenues to fund government activity. The tax code is a psychological weapon used by the parties to work people up into an emotional frenzy so that they can secure votes under the guise that they will address the problem.

The level of marginal rate debate is built on a complete fallacy, that fallacy being that there is a certain percentage of the wage earners not paying their "fair" share, hence because of this, the poor are getting shafted. Therefore if we simply raise rates on the high wage earners, the poor will somehow magically become wealthy. Of course left out of this complete nonsense is that there is no mechanism offered by Congress and no plan to specifically route the increased revenues into a mechanism by which this can possibly take place. It is a total con job by the political left. The increased revenues simply flow to the US Treasury and are lost in the black hole of government appropriations. It is nothing more than feel good accounting gimmickry. A simple analogy is lawfully mandating that the well off family cut up their steak dinner and throw half in the trash. They are less satisfied, but the homeless guy on the corner is still starving to death.

Poor people have a problem. Their revenue stream is sub-standard. It can only be increased essentially by two ways. They either must bring home bigger paychecks or receive bigger government transfers. That is it.

The simple fact is that we are being manipulated into a false debate about a solution for a problem that it can't fix. The solution to poverty is very simple, pension funds have been doing it for years in that you simply "liability match". In this case, you simply tax whoever has the money and make direct payments to the people who you deem poor and at a level you believe brings them out of poverty. Problem solved.

Neither party wants to solve poverty anymore than Reverend Al wants to eradicate racism.

I was with you until that bum boil appeared.

The only way to solve poverty is for women to practice the aspirin between their legs strategy until they marry a decent guy before having kids and then staying married.

If you have a near 50% out of wedlock birth rate you ain't going to solve it any time soon.

 

[One Brow]

Food stamps. The people I deal with are amoung the poorest in the country. Not my fault you choose to ingore the way many of them choose to spend their money.

I've been on food stamps. They don't cover shrimp and steak, unless you have your own, outside money or are wiling to skip meals. Nor am I ignoring anything. I just acknowledged that many people who live in poor neighborhoods spend money just as you suggested. I guess my agreement was a little confusing for you.

 

[One Brow]

Nothing like paying taxes to help the poor and watching them make horrendous decisions (some not all). Then getting mad about it and having some self appointed crusader try to make you feel bad for your opinion.

Some poor people make bad decisions, absolutely. I have no problem with saying that, or even being a little upset about it. Rich people make bad decisions, middle-class people do, poor people do.

Victim blaming
The assumption that this represents a "large percentage" of the poor
The assumption that this "large percentage" has DirectTV and smart phones
The assumption that foregoing DirectTV and smart phones will allow you enough monry to afford health insurance or car insurance, much less both
The assumption that the primary reason they are poor is the bad decisions

 

[Stoked]

Are there people that choose to spend their income in phones, shoes, and steaks as opposed to housing and cars? Sure. Does that mean they are poor? Not necessarily. If you can afford to spend $100/month on your phone and $500/month on your food, that's $7200 before we even talk about rent, utilities, transportation, etc. You think many people at $10,000/year live like that, and say you have "experiences" with the poor?

I've been on food stamps. They don't cover shrimp and steak, unless you have your own, outside money or are wiling to skip meals. Nor am I ignoring anything. I just acknowledged that many people who live in poor neighborhoods spend money just as you suggested. I guess my agreement was a little confusing for you.

That first paragraph looks like agreement...yup...sure does...

 

[One Brow]

So, sincere question.. how do you propose we have everyone have equal opportunities (as you've described above) without equalling out individual efforts/incomes? Where do you draw the line?

To be honest, I don't have a pat answer to that. However, a good starting point is to look at each child as someone worthy of investment.

Nice suit: less than $100 off-the-rack
Nice car: not really needed
Great haircut: $20
Resume: the colleges I went to helped with that
MBA from Georgetown: major expense, but there are loan programs to cover the cost

Notice that this is all about young people, by the way. Nothing about equalizing results for people in their forties and fifties, even in these examples you seem to have meant to be over-and-above. How many of these young entrepreneurs are we missing out on because when they are aged 5-15, they aren't fed right and taught well?

Conservatives seem to think liberals don't want people to succeed, but the opposite is true. I have no problems with your success, and you should enjoy the fruits thereof. I just want my students, and the kids that go to the clinics I work for, to have that same chance.

 

[One Brow]

So which part entails the injustice, wealthy people being able to have things they want above and beyond their needs or poor people not being able to have much beyond what they need to live?

Limiting the opportunities of a child because of who is parents are.

 

[One Brow]

Nevertheless, he raises a valid point.

It is hard to stomach especially by someone like yourself that has come so far from so little. But there ARE people that are poor because they make bad decisions, have misaligned priorities, etc. Again, sad to say, but no amount of throwing money, welfare, goods, services, or otherwise at them is going to help them.

The key here is education. Can we teach them to make better decisions, to think objectively and have logical priorities, etc.? Yes.

But yet another key here is their desire to be educated.

They have to want to learn... they have to want to better themselves... and a significant portion of those that are poor do not want to go to the effort. They just want what they want.

I think that's the biggest threshold to be determined here.
At what point is it just to take from one to give to another who is in need?
And at what point is it unjust to take from one to give to another who will waste it and/or not use it wisely?

The differences in opinion arise from varying viewpoints on where those thresholds are, and which has priority.

I largely agree with what you say, with one additional caveat: one reason that many of the poor do not want to go through the effort is that they have been taught by culture, by anecdote, and by experience that effort will be just as likely to be punished as to be rewarded. I'm sure there are people who prefer to live with roaches, but for most of those I've met, the conviction has been that they can't or won't be allowed to do better, not that they prefer to stay where they are.

 

[One Brow]

Colton, what should be changed, then? What is the "fair" amount that should be taxed for different levels? Why exactly is it harder for the $10k earner to pay 10% and how do you quantify that? Is it easier for the $100k earner to pay $30k in taxes than for the $70k earner to pay $1k?

Good question. You can measure happiness and suffering in different ways, and come up with different answers on what is fair. Also, you don't want a tax code that will remove incentive. So, I don't think there is a good answer on whether $100 from a person earning $10,000 causes more suffering than $10,000 from a person earning $100,000. However, the lack of a confidently correct answer doesn't mean we cant rule out other answers as wrong.

 

[One Brow]

Neither party wants to solve poverty anymore than Reverend Al wants to eradicate racism.

You really should post more.