Welcome to PatsFans.com

Tax Data Reveals Inequities by the Very Rich...

Discussion in 'Political Discussion' started by DarrylS, Jun 9, 2012.

  1. DarrylS

    DarrylS PatsFans.com Supporter PatsFans.com Supporter

    Joined:
    Sep 13, 2004
    Messages:
    41,421
    Likes Received:
    138
    Ratings:
    +265 / 10 / -26

    Interesting chart, clearly illustrates how the poor will stay poor and the middle class will be no more.. all the while there are some rich amongst us who pay nothing at all..

    The loopholes need to be closed, and the ever failing Bush tax cuts for the rich folks need to end..

    The National Memo » David Cay Johnston: The Fortunate 400

    [​IMG]
  2. patsfan13

    patsfan13 Hall of Fame Poster PatsFans.com Supporter

    Joined:
    Jan 4, 2005
    Messages:
    24,757
    Likes Received:
    74
    Ratings:
    +161 / 7 / -13

    Flat Tax solves the problem, Politicians want to fiddle with the system to reward donors.
    Last edited: Jun 9, 2012
  3. PatriotsReign

    PatriotsReign On the Roster

    Joined:
    Jan 15, 2007
    Messages:
    26,509
    Likes Received:
    135
    Ratings:
    +344 / 3 / -13

    Something is fishy with your chart Darryl. I know I pay a heck of a lot more than 11-12% tax rate...more like 35%. Your chart doesn't tell the reader if this tax rate is just federal income taxes, all federal taxes or all forms of taxes. Is social security/fica included?

    Can you tell us what it reflects?
  4. patsfan13

    patsfan13 Hall of Fame Poster PatsFans.com Supporter

    Joined:
    Jan 4, 2005
    Messages:
    24,757
    Likes Received:
    74
    Ratings:
    +161 / 7 / -13

    My guess is that people who are declaring >77M/year are not doing that every year and that money is more capital gains that salary, same with the >10M demographic, not a lot of those folks either.
  5. PatsFanInVa

    PatsFanInVa PatsFans.com Supporter PatsFans.com Supporter

    Joined:
    Mar 19, 2006
    Messages:
    20,376
    Likes Received:
    252
    Ratings:
    +437 / 6 / -9

    What am I missing, Daryl?

    The chart seems to indicate that the <5000 contingent (in AGI) get a very bad deal in terms of effective tax rate - however at the upper income, it shows the effective rate, while down around the 20s, to be well above the rates for the middle class, as is appropriate.

    However, while you may not like the extent to which the tax code is actually slightly progressive, your chart points to that conclusion -- albeit with a big reversal of that tendency for the very poorest.

    In terms of a flat tax, of course it would be less progressive than the status quo. I'm glad to look at formulations to the contrary, but that's always been my suspicion.

    PFnV
  6. Wolfpack

    Wolfpack Banned

    Joined:
    Sep 6, 2009
    Messages:
    9,111
    Likes Received:
    0
    Ratings:
    +0 / 0 / -0

    That's sure what it looks like to me as well. Essentially Darryl made a statement about how unfair the tax rates are and how much the middle class is being screwed - and then he provided us all a chart which directly contradicts his thesis. :rofl: :rofl:
  7. patsfan13

    patsfan13 Hall of Fame Poster PatsFans.com Supporter

    Joined:
    Jan 4, 2005
    Messages:
    24,757
    Likes Received:
    74
    Ratings:
    +161 / 7 / -13



    Well under say a Forbes style Flat Tax you have a personal exemption of ~15k per person (12K when originally proposed to be indexed for inflation) with a 17% rate for income after that.

    So for a famil of 4 making 60K 0% rate, a family of 4 making 100k 6.8% rate, for the same family of 5 making 1,050,000 a rate of 16.2%.
  8. PatsFanInVa

    PatsFanInVa PatsFans.com Supporter PatsFans.com Supporter

    Joined:
    Mar 19, 2006
    Messages:
    20,376
    Likes Received:
    252
    Ratings:
    +437 / 6 / -9

    For me, two tests, 13 -

    1. If the curve bends more right than this, I like it more.
    2. The tax would have to produce the same or preferably greater revenues.

    The revenues part is because we have unrealistically low rates (or the right likes to say we spend too much, but that's an agree to disagree point... we spend more than we bring in, so we ought to stop it.)

    PFnV
  9. PatsFanInVa

    PatsFanInVa PatsFans.com Supporter PatsFans.com Supporter

    Joined:
    Mar 19, 2006
    Messages:
    20,376
    Likes Received:
    252
    Ratings:
    +437 / 6 / -9

    By the way, Darryl's got a very good point about two groups represented in this graph:

    1) Those with AGI <10,000 in general, and
    2) Particularly those with AGI <5,000.

    For them, the system is very regressive, without regard to how it works for the very well-off.
  10. PatsFanInVa

    PatsFanInVa PatsFans.com Supporter PatsFans.com Supporter

    Joined:
    Mar 19, 2006
    Messages:
    20,376
    Likes Received:
    252
    Ratings:
    +437 / 6 / -9

    [​IMG]

    Interesting...
  11. PatriotsReign

    PatriotsReign On the Roster

    Joined:
    Jan 15, 2007
    Messages:
    26,509
    Likes Received:
    135
    Ratings:
    +344 / 3 / -13

    But the key point is that when the gov't calculates estimated revenue, they must do so under a hypothetical rate of employment. In other words, citizens wouldn't want our gov't to calculate the rate they "need" under the current rate of employment because that would cause them to make rate too high.

    Any such effort can't and should not be influenced by "rate of employment" so that the gov't raises rates when unemployment is high and lowers it when/if we have full employment.

    Do not make the tax rate connnected to the rate of employment. Otherwise, the burden will always be too heavy upon those with jobs.

    Oh, and lets make it so more than 50% of Americans actually pay taxes.
  12. PatsFanInVa

    PatsFanInVa PatsFans.com Supporter PatsFans.com Supporter

    Joined:
    Mar 19, 2006
    Messages:
    20,376
    Likes Received:
    252
    Ratings:
    +437 / 6 / -9

    Hence the need to cut taxes -- particularly in the middle and toward the bottom, where it counts -- during economic downturns.

    Long-term tax policy can't be confused for "emergency measures" (such as the supposedly temporary to the cut in payroll taxes.)

    On the flip side, we also depress interest rates at precisely the same time.

    Here are the mechanics of what that does -

    1) It makes all your debt from future obligations look bigger, because a lower discount rate balloons the present value of future obligations, but also

    2) If those rates are supported by all our borrowing being at a similarly low rate -- i.e., if in fact there is still a global and domestic recession/depression -- then our borrowing costs are low, and it is a good time to have debt.

    Sort of like having 10 grand in credit card debt, knowing you must spend another 1K, but at least moving the debt to an intro rate of 0% for a year.

    But again, these are the mechanics of short term recovery efforts, and should not be confused with "tax reform." If you want to reform taxes, reform them bearing in mind the amount we actually spend. We're coming up with something like 15% of revenues, with spending at more like 23%. Duh. We're going to have a deficit.

    And a larger and larger chunk of that total we spend is servicing current debt.

    The key is, when times are good, the total revenues have to grow.

    We're now discussing the "fiscal cliff" that will be generated by sequestration. Yet for those who use simple-minded "look, we're STILL running a deficit" talk, the level we get through even falling off that "fiscal cliff" isn't low enough. Fact is, you can't cut spending without having a negative impact on jobs.

    HOWEVER, if you want to cut spending and raise revenue in general -- and we must -- the time to do it is when things are going good.

    Remember that, when the righties bounce from "you can't raise anybody's taxes in a recession (true)" to "Why mess up a recovery by re-establishing sustainable revenue levels? (false)"

    Raising percentage of revenue has to be counter-cyclical.

    See above. By contrast, emergency measures must be influenced by factors such as employment... but have to be allowed to expire.

    The Bush cuts, for instance, helped create the present mess by carrying lower rates too far for too long, therefore deficit spending for too long, and doing it when nobody needed the break. Ultimate outcome: any "paper gains" in the last decade were erased by one fell swoop, which simply added enormously to our future obligations.

    Two things:

    1. You would like the unemployed to pay more taxes? I hope you understand the natural skepticism with which I view this reform proposal.

    2. Without the usual back-and-forth about the elderly and the indigent, etc., the 50% figure is all the less impressive when you're measuring a country that's been systematically impoverished at the lower end and in the middle.

    This "50% who pay no taxes" canard only has legs if you think you'll actually collect your extra grand from each of the "other half" of America. It's very unlikely you'll do so.

    And if you're talking about a buck a person, your 50%, even if based on the entire population, ends up getting you $150M, which is decimal dust when you're talking about a trillion dollar endeavor.

    PFnV
  13. PatsFanInVa

    PatsFanInVa PatsFans.com Supporter PatsFans.com Supporter

    Joined:
    Mar 19, 2006
    Messages:
    20,376
    Likes Received:
    252
    Ratings:
    +437 / 6 / -9

    Let me amend the preceding...

    When I mean you can't get anywhere by attempting to tax people who don't work, I mean those who also don't have enormous investment gains. Taxing the unemployed who are looking for work probably doesn't get you anywhere. Taxing the idle rich who claim they "invest for a living" can get you something. Unfortunately, it's more a starting point. Taxation is how the gubmit gets revenue. We owe a bunch of money. We have to pay what we owe somehow. There is exactly one way to meet the "somehow" requirement, and that is taxation.

    PFnV
  14. Wolfpack

    Wolfpack Banned

    Joined:
    Sep 6, 2009
    Messages:
    9,111
    Likes Received:
    0
    Ratings:
    +0 / 0 / -0

    Raising massive amounts of revenue is not the problem here. The problem is massive out of control and wasteful spending.

    The goverment is like Antoine Walker, who made $100 million in income over a 10 year period, but blew every single penny AND racked up about $10 million in debt because he maxed out all his credit cards and lines of casino credit. A liberal looks at Walker and says "well obviously his problem is he just didn't earn enough money. If he had just made about 10% more income, he'd have a balanced budget."

    A conservative looks at Walker says "his problem was not his income, it was his spending. He was obviously hell bent on spending it all and then some. Raising his income would not have solved any of his problems."
    Last edited: Jun 10, 2012
  15. PatsFanInVa

    PatsFanInVa PatsFans.com Supporter PatsFans.com Supporter

    Joined:
    Mar 19, 2006
    Messages:
    20,376
    Likes Received:
    252
    Ratings:
    +437 / 6 / -9

    Yes, yes, of course all spending is wasteful :rolleyes:

    However, having borrowed money to do our past spending, do you intend to continually borrow to pay what you owe, or more properly, just the interest on what you owe?

    Or do you eventually start chipping away at what has already been spent? With what do you pay that? Is it free? Or shall we print monopoly money ad infinitum?

    Regardless of your personal feeling about how wasteful it is to have a military, keep the old from eating alpo, extend unemployment benefits, study bee dances, or whatever, 15 trillion of that money is spent and not repaid.

    Just the interest on that is a huge budget item. In the first half of 2012, the interest alone cost us $104 billion, and that's with bargain basement interest rates -- you could annualize that at $208 billion.

    Here's our 2011 spending...

    [​IMG]

    As you can see, interest on the debt alone is about 1/2 the size of discretionary spending subject to proposed cuts. You can also see that defense spending dwarfs both, and that the entitlements (social security, medicare,) are about double defense spending.

    Unfortunately, in addition to just coming out of a really deep recession -- I know, I know, the right is rooting for another dip, yay Spain! -- we're also aging. Hence the bump in Medicare/SS spending, and it's just beginning.

    (And please don't try to peg 2011 health spending to the Affordable Care Act - very little's been spent other than continuation of existing programs)
    CRS Report: Discretionary Spending in the Affordable Care Act | AADR Government Affairs

    So, we have a small problem with domestic discretionary spending - the stuff we love to cry about like studying bee dances, welfare, etc. Our present hit for interest on the debt is about 1/2 the size of the entire discretionary spending chunk subject to cuts proposed... i.e., not counting military.

    We have an enormous problem with military spending. We have a ginormous problem with obligations to the old and the sick, because more and more people are going to be old.

    Your "we have a spending problem" mantra depends on you establishing some other means to deal with old age.

    In the meantime, we're in a hole. The teabagger commercial says the first thing to do is stop digging -- well, bad timing. You spend when you're recovering. You guys keep saying we're not recovering fast enough -- well, the tried and true way to spur recovery is spending. That's why you reduce spending and raise taxes when you're in an era of prosperity.

    Why do you think sequestration is being called a "fiscal cliff"? It's not because oh no, we automatically cut some programs instead of having the balls to do it "on purpose." It's because cutting deeply into defense and discretionary spending in this spasmodic way will in fact depress the economy. Everybody knows this.

    Me, I'm a fan of getting this recovery on a solid footing, then discontinuing things like extended unemployment and the bush tax cuts.

    You need many, many years of Clinton-era surpluses to dent the Bush spending binge that resulted in our present debt picture. You don't get surplus without raising revenues so they exceed spending. And you ain't getting spending down by hundreds of billions a year without affecting the economy (not to mention disregarding the needs of the country). Chicken and egg, my friend, chicken and egg.

    PFnV
  16. Wolfpack

    Wolfpack Banned

    Joined:
    Sep 6, 2009
    Messages:
    9,111
    Likes Received:
    0
    Ratings:
    +0 / 0 / -0

    What say we balance the budget first, ok? Then when we do that we can worry about chipping away at the $15 trillion.

    I, for one, am pretty darn sick and tired of the wage earners is this country being punished by the people who sit around and do nothing. Now please tell me again how Antoine Walker's problem was he just didn't make enough money.
    Last edited: Jun 10, 2012

Share This Page

unset ($sidebar_block_show); ?>