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5% Of U.S. Taxpayers Account For 60.6% Of All Tax Revenue, 47% Will Pay No Federal Tax In 2009

Tyler Durden's picture





 

An interesting observation courtesy of Mint: of the 307,868,280 Americans out there, which compose 151,485,000 tax units, 46.9% will have zero federal income tax liability in 2009. Brilliant plan to keep the country happy: the poor pay no taxes, the rich get a massive stock market bubble to sell into, and the disappearing middle class...well, they can pay $20 for a hotdog and beer combo in Prague on that once-every-five-years vacation.

h/t John Connor

 

 


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Tue, 11/17/2009 - 15:24 | Link to Comment crosey
crosey's picture

I'd like to think that when the VAT hits (to pay for healthcare), the Fair Tax discussion will resume.

Elimination of corporate and personal income tax, and introduction of a consumption tax, is the only way that the middle class will survive.

Should I dream of an end to fiat currency too?!

Tue, 11/17/2009 - 16:36 | Link to Comment DaveyJones
DaveyJones's picture

consumption tax picks up the underground economy too.  

Tue, 11/17/2009 - 23:33 | Link to Comment Unscarred
Unscarred's picture

Well, given that the O-blunder economy is unresponsive and hooked up to a breathing machine, I say we double-down on the underground economy ASAP!

Shit, what do we have to lose at this point?

I've gotta think that a lot of underground 401k's will be the only things supporting anyone for the next 30+ years.

Tue, 11/17/2009 - 21:21 | Link to Comment Astute Investor
Astute Investor's picture

I agree 100% that the Fair Tax is a tax system that makes sense and would be an important building block for more stable, long-term economic growth.  However, implenting the Fair Tax would mean the elimination of many high-paying service jobs (CPAs, tax lawyers, consultants, etc.).  It's hard to see how people in those professions would let such a system be enacted which mean the elimination of their jobs.  Too much money and political power to let that happen.

Wed, 11/18/2009 - 10:35 | Link to Comment Anonymous
Thu, 11/19/2009 - 10:19 | Link to Comment Anonymous
Tue, 12/15/2009 - 16:38 | Link to Comment Anonymous
Tue, 11/17/2009 - 23:44 | Link to Comment Anonymous
Wed, 11/18/2009 - 03:33 | Link to Comment LittleSambo
LittleSambo's picture

I'd prefer to see a flat tax implemented.  Not a flat rate tax - a flat tax.

No capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or Enumeration herein before directed to be taken.

 

 

 

Wed, 11/18/2009 - 20:32 | Link to Comment Anonymous
Mon, 11/23/2009 - 11:01 | Link to Comment Anonymous
Tue, 11/17/2009 - 15:30 | Link to Comment andy55
andy55's picture

A splendidly fascinating breakdown of data -- there's a LOT of information impressively organized there.  It would be interesting to see some time/trend data in the form of a similar breakdown from say the last two years (although I realize in practice Mint may not have that data).

I find it interesting that the $500k+ category (1% of the tax units) makes up for about 40% of federal tax revenues.  This suggests that it would be illuminating to see that 1% broken into smaller pieces.  You'd hope that that the top .1%, which generally kicks off the truly elite class percentile, makes up a majority of that 40% block, but with high powered accountants and tax shelter tactics I'm not so sure.

Tue, 11/17/2009 - 15:44 | Link to Comment Divided States ...
Divided States of America's picture

Only the rich can hire tax specialists to evade taxes. Look at Wesley Snipes, Mike Tyson, half of the Democrats in the house and Turbo Tim.

Tue, 11/17/2009 - 15:58 | Link to Comment Mad Max
Mad Max's picture

The third and fourth noted evaders are more scofflaws than users of professional tax planning.  And Snipes had a very close call.

Tue, 11/17/2009 - 16:24 | Link to Comment sethstorm
sethstorm's picture

...as well as Republicans, and various multinationals.

Tue, 11/17/2009 - 19:15 | Link to Comment Charlie J
Charlie J's picture

Yes, having tax specialists is a necessity if you are wealthy.  But, have you ever heard of AltMin?  Do you even know what it is?

Tue, 11/17/2009 - 15:32 | Link to Comment D.O.D.
D.O.D.'s picture

The unemployment rate back in March 2007, just nine months before the recession started, was 4.4%. Compare this to the 7.5% unemployment rate nine months before recession of the early 1980s. According to Deutsche Bank economist Joseph LaVorgna, in relative terms "the current deterioration in the labor market is without precedent."

Philips said Congress will likely enact $250 billion in additional fiscal measures to support growth over the next three years, including $75 billion more in 2010. However, recent developments -- including the $45 billion law enacted last Friday to help homebuyers -- make this assumption look increasingly conservative.

http://articles.moneycentral.msn.com/Investing/top-stocks/blog.aspx?post...

Tue, 11/17/2009 - 15:31 | Link to Comment duckweed
duckweed's picture

Friedman's shock doctrine begin's at 2:24  - wake up sheeples!

http://www.youtube.com/watch?v=aSF0e6oO_tw

Tue, 11/17/2009 - 16:23 | Link to Comment Anonymous
Tue, 11/17/2009 - 23:43 | Link to Comment Unscarred
Unscarred's picture

Why is it that the most critical posts always come from the same Anonymous user?

(Hmmmmmmmmmmmmmmm...)

Tue, 11/17/2009 - 15:44 | Link to Comment max2205
max2205's picture

Hell yeah, that's why the don't try increase employment to a large degree.  Help just enough to prevent a march on DC.

Great post,  DC is diying because most of the layoffs are at that 100 k area supporting 26% of the income tax flow....the rest don't mater to them because the numbers don't change enough to effect Inc tax flows.

 

Lets look at this after Pelosi kills Bush tax cuts

 

nice

Tue, 11/17/2009 - 15:46 | Link to Comment Anonymous
Tue, 11/17/2009 - 15:49 | Link to Comment Anonymous
Tue, 11/17/2009 - 17:42 | Link to Comment Anonymous
Tue, 11/17/2009 - 19:33 | Link to Comment Jerome Lester H...
Jerome Lester Horwitz's picture

Payroll taxes are paid 100% by the employee. Splitting the amount between employer and employee is nothing but a gimmick to make the employee think that the employer is getting hosed too.

Tue, 11/17/2009 - 20:32 | Link to Comment Anonymous
Wed, 11/18/2009 - 02:38 | Link to Comment SRV - ES339
SRV - ES339's picture

Good point... the 47% is misrepresented as "no taxes" (instead of no Federal Income tax) by the right all the time... seems they never get called on it.

Wed, 11/18/2009 - 16:01 | Link to Comment Anonymous
Wed, 11/18/2009 - 16:24 | Link to Comment Anonymous
Tue, 11/17/2009 - 15:49 | Link to Comment phaesed
phaesed's picture

Well, if it really hurts your feelings that the poor aren't paying a large portion of the taxes, just remember that while you enjoy your $20 hot dog, they're enjoying the remains of that pigs dirty cousin.

 

I get why there's the furor over the poor not paying taxes.... perhaps the middle class small business owner will think about that and cough up more than minimum wage.

Tue, 11/17/2009 - 15:53 | Link to Comment Anonymous
Wed, 11/18/2009 - 12:53 | Link to Comment Anonymous
Wed, 11/18/2009 - 13:09 | Link to Comment Anonymous
Tue, 11/17/2009 - 16:00 | Link to Comment duckweed
duckweed's picture

yes, increase the pay for those who serve you, help the poor little proles shoulder their load. this article is crap. anyone in that top 1%, I ask you? how much do you have left as discretionary income after you pay your taxes? those toward the bottom do not even know the phrase "discretionary income".

Tue, 11/17/2009 - 17:07 | Link to Comment Miyagi_san
Miyagi_san's picture

does discretionary income come before you fill up your gas tank or after

Wed, 11/18/2009 - 00:42 | Link to Comment mberry8870
mberry8870's picture

Therefore take it from me???? Is the spelling of your alias correct?

Wed, 11/18/2009 - 07:08 | Link to Comment Anonymous
Tue, 11/17/2009 - 16:00 | Link to Comment jefe95
jefe95's picture

Seriously?

 

Is that really how you think?

Tue, 11/17/2009 - 16:03 | Link to Comment faustian bargain
faustian bargain's picture

Right, because it's middle class money-grubbing that's causing all the problems here.

Not to worry though...since misery loves company, the middle class will soon be joining the poor in the soup line. See, they really do believe in equality.

Tue, 11/17/2009 - 20:32 | Link to Comment Rollerball
Rollerball's picture

Because there is no such thing as balance or middle ground?  There is only left or right, up or down.  Fence sitters, or "balancers", become expendable because they don't subscribe to extreme(ly) ambitious method?  Surely you jest.

Tue, 11/17/2009 - 16:15 | Link to Comment Mad Max
Mad Max's picture

You know, making a combined $80k or $100k is really not any more than just scraping by for a couple with two children in most urban areas.  It won't even leave enough to save much for college or retirement.  On the coasts even a combined $200k isn't going to make you rich.  But it does get you a hefty tax burden.

Ultimately, though, it's not so much about whether the middle class has "enough," it's about basic fairness.  When you see people with no education, no skills, and nothing really going for them but the ability to collect a check (welfare, unionized unskilled labor, or otherwise), getting more out of the system (whether as cash, vouchers, scholarships, interest-free loans, subsidized housing, or whatever) than people who have degrees and have worked their butts off from age 16 onward, you see a system that is grossly unfair.  And becoming more reminiscent of the socialised economies that collapsed under their own misallocations.  It's happening here, right now.

Tue, 11/17/2009 - 16:20 | Link to Comment RockyR
RockyR's picture

the other problem we haven't mentioned here is that people who don't pay taxes still vote...  the participate in the decision making for the system without bearing any of the cost.  that is a HUGE problem.  we talk about moral hazard around here a lot, we should be able to recognize the issue for what it is.

Tue, 11/17/2009 - 16:41 | Link to Comment duckweed
duckweed's picture

as if your vote(or thiers) makes a difference. ROTFLMAO!!!

you're still sleepwalking.

Tue, 11/17/2009 - 17:16 | Link to Comment Tommy
Tommy's picture

By your logic, illegal aliens who pay taxes are the ones really getting screwed.

 

Historically, land owners were the only ones with a "vote".  IMO, The US got really strong by giving all people (no woman originally) the vote which fosters a sense of belonging and sharing in any national prosperity.

Tue, 11/17/2009 - 19:05 | Link to Comment duckweed
duckweed's picture

land ownership is an abomination. this earth is not owned by anyone.

Wed, 11/18/2009 - 03:36 | Link to Comment Anonymous
Wed, 11/18/2009 - 10:58 | Link to Comment DonnieD
DonnieD's picture

The illegal aliens can go back to where they came from if they are getting screwed.

It's easy for a citizen to want for free healthcare/welfare when they will never pay for it. It's like children running the parent's finances.

The liberal game plan is to get enough voters benefiting from their handouts to overwhelm the voters who are paying for them.

Tue, 11/17/2009 - 19:18 | Link to Comment Charlie J
Charlie J's picture

This always make me think of the old saying, "Once people realize that they can vote themselves money, they will."

Tue, 11/17/2009 - 21:58 | Link to Comment torabora
torabora's picture

We had a single parent Dad come to our public college Board Meeting and thank the college for all the free shite he got that made him able to attend college...as opposed to working I suppose.

Tue, 11/17/2009 - 16:33 | Link to Comment duckweed
duckweed's picture

who are you getting your information from? is it glen beck, limbaugh, or are you channeling Newt Gingrich ala 1994? You're talking smack at worst, or just don't have a clue as to what you are talking about at all, at best...

I have generally made, on average, around 80K/yr, for the past twenty years. And you are right about one thing, 80K in 1989 allowed me to live large for a little people, 80K in 2007(last year I worked), I felt like I was barely scraping by.

As for the working or non-working poor though, and I know many poor people personally, family members included, they are not collecting checks, they might recieve food stamps and their children some medicare benefits, but not a single one is able to just live off the System. And not a single poor person I know is aspiring to live off the system, every single one has at least a part time, minimum slave job, that gives them just enogh so that can continue to serve ignorant degree clutching greedheads like those that espouse the kind of nonsense you just wrote.

I have done the only courageous thing thing that is left, I have dropped out of the sytem entirely, and I have no qualms of taking from the rich, THEY ARE THE PROBLEM. Of course if I take anything from the rich, it will not be done under any legal system set up by themselves.

I am here at zerohedge to make the rich and those who pretend to that their fate is in alliance with the rich - UNCOMFORTABLE. there are many more like me and our numbers are growing.

rockin the revolution!

 

Tue, 11/17/2009 - 16:41 | Link to Comment Mad Max
Mad Max's picture

Viva la Revolucion, Comrade!!!  Maybe you'll get a "Che" shirt with your face on it someday.

There's so much bias and absurdity in your post it isn't worth responding to.  I have relatives at various pay and education levels and firsthand knowledge of how far money goes and who has done what to earn their "stuff," be it in cash or in (direct and indirect) government handouts.

Tue, 11/17/2009 - 16:51 | Link to Comment duckweed
duckweed's picture

we are all biased. the way I look examine the bias is, of all the bias, which bias might help the most people suffer less? the bias of the rich and thier lackeys, benefits few.

wake from your long slumber friend and join the revolution. the courage is their within you if you look deeply enough. and it will be only through the courageous audacity to suffer the scorn of fools, that you might taste what it is to be alive.

to use the jingoism of the blogs theme -

"Man, I see in fight club the strongest and smartest men who've ever lived. I see all this potential, and I see squandering. God damn it, an entire generation pumping gas, waiting tables; slaves with white collars. Advertising has us chasing cars and clothes, working jobs we hate so we can buy shit we don't need. We're the middle children of history, man. No purpose or place. We have no Great War. No Great Depression. Our Great War's a spiritual war... our Great Depression is our lives. We've all been raised on television to believe that one day we'd all be millionaires, and movie gods, and rock stars. But we won't. And we're slowly learning that fact. And we're very, very pissed off." - Tyler Durden

Tue, 11/17/2009 - 17:20 | Link to Comment Mad Max
Mad Max's picture

Meh.  I checked out of the rat race without even realizing I was doing so.  Sometimes good things in life come by surprise.

Revolutions are always taken over by people aspiring to be the new tyrants anyway.

Tue, 11/17/2009 - 18:31 | Link to Comment Anonymous
Tue, 11/17/2009 - 21:55 | Link to Comment torabora
torabora's picture

The rich outsourced 10's of millions of middle class jobs to the turd world. Now they're busy taking the middle classes homes, bank accounts, and retirements via more job losses. This will not end well if not reversed.

 

Wed, 11/18/2009 - 11:25 | Link to Comment Anonymous
Thu, 11/19/2009 - 08:23 | Link to Comment Anonymous
Tue, 11/17/2009 - 16:55 | Link to Comment Anonymous
Tue, 11/17/2009 - 17:01 | Link to Comment Anonymous
Tue, 11/17/2009 - 17:52 | Link to Comment Anonymous
Wed, 11/18/2009 - 01:46 | Link to Comment moneymutt
moneymutt's picture

I don't think any of the probably about 60 percent of working aged people gainfully employed in living wage jobs truly gets what is like for the other 40 precent that are unemployed or barely scrapping by working min wage jobs. I know very talented and education mechicanical engineers, civil engineers, chemical engineers, architects, science types with 15-25 years or previously well off business guys that owned painting company, or electircal bus, or a small engineering deisgn firm that are making 40 percent of what they were 2 years ago...they are now decscending into poverty and lsoign their houses just cause they were working in the wrong industries at the wrong time and got laid off last fall or last winter or had their income dropp drastically and yet there are many average folks that have a job in a more secure company and that survived a cut or two that are doing just fine thank you, maybe no raise, maybe a slight cut in pay, but hey they got a good deal on a new car.

And then of course the ones who really don't get what its like for the 40 precent hurting like hell,,,and those clueless folks are in our Pres' admin and in Congress.

Tue, 11/17/2009 - 17:52 | Link to Comment Argonaught
Argonaught's picture

+1.  Well said.

Tue, 11/17/2009 - 19:24 | Link to Comment duckweed
duckweed's picture

as long as MSM(owned and message controlled by Corporations, ie the top .01 percent) can still manipulate us(any couple(and that is another checkpoint you must learn/research for yourself) making less than $500K/yr) into believing that each other are the reason we are being oppressed, this fools game can go on forever.  we scrap amongst ourselves whe we need to coalesce and bring their system to it's knees. then working together. first at a community level, and then regional, continent, and finally world level, the capacity is there to create a more equitable system. sure, there will always be tyrants, but history has toosed them to the trash heap time and time again. our country is an excellent example of this. and thomas jefferson was right, indeed eisenhower was right, and now it is time to clean up this mess.

yes, I think land ownership is an abomination, but that does not mean that I and others like me, are not willing to accept land ownership as part of the solution(this is just an example of many), in order to fashion a more just and humane system where the rights of all people and are respected. I will not tread on you unless you have decided your rights include the freedom to tread on me.

Wed, 11/18/2009 - 00:34 | Link to Comment Orly
Orly's picture

The dickweed has a point there.  The strategery: divide and conquer and watch the little people squabble amongst themselves while we rake it all in.

Say, any black, Jewish, female, lesbian, pro-life conservative Democrats in the house tonight?

Tue, 11/17/2009 - 16:56 | Link to Comment chet
chet's picture

You're throwing a lot of stuff together there.  First, "unskilled labor" are people who still punch a clock to earn their way through life.  Sorry if they didn't make it through as much schooling as you, but they don't deserve your scorn.  Working a low-skilled job 8+ hours per day is very often harder than working a white-collar one, believe me.  Not always physically, but mentally in terms of tedium, low reward for your time, low morale, etc.

"Welfare" is now essentially restricted to people who have dependent children, and restricted to five total years in a lifetime.  Long-term residence in public housing, and abuse of SS "disability" system are more serious problems than "welfare".

It's definitely not good to have so many people not paying in, but my question is how many local and state taxes these people pay.  No one really escapes the taxman.

Tue, 11/17/2009 - 16:57 | Link to Comment duckweed
duckweed's picture

amen brother!

Tue, 11/17/2009 - 23:58 | Link to Comment Anonymous
Tue, 11/17/2009 - 19:54 | Link to Comment moneymutt
moneymutt's picture

knowledge workers in expensive urban areas get screwed because so much of their income is really revenue covering expenses such as paying med school debt, higher houses costs in the area.....if they, a knowledge worker could do like a business, they could say, well I make more revenue in NYC but my costs are higher, and I make more as a doctor, but my education costs are higher, and then they would just pay taxes on the net profit. But 100-200k do get over with no FICA, but then get screwed by AMT.

Tue, 11/17/2009 - 21:39 | Link to Comment Mad Max
Mad Max's picture

To an extent student loan interest is deductible.  But if you did something useful with your student loans, your income is probably just over the limit at which the student loan interest stops being deductible.  It's a great catch-22.  It's like the government wants more art history majors who'll end up working at Starbucks while scrimping to pay their 30-year-consolidated student loans.

Wed, 11/18/2009 - 00:10 | Link to Comment Anonymous
Wed, 11/18/2009 - 00:35 | Link to Comment Mad Max
Mad Max's picture

I have pity for those people - I know a LOT of them - but that doesn't mean it's not a dumb system with perverse incentives.  Why not make student loan interest deductible if you're an engineer, scientist, or nurse, but not if you're a lawyer or banker?  One of the major effects of the silly college system is all these people who are moderately smart, think they're very smart, and can't get any decent job with their history degree.  So they go to law school, or maybe business school after getting the requisite few years of $35k coffee-fetching on the resume.  It's just another debt-funded bubble, and it too will explode at some point.  If our public schools actually educated then you would be able to expect a high school graduate to be competent for a wide range of useful work, not just unskilled labor.

Wed, 11/18/2009 - 00:59 | Link to Comment Anonymous
Wed, 11/18/2009 - 02:10 | Link to Comment moneymutt
moneymutt's picture

Mish had a good post on the education issue....if there are not jobs, such as manufacturing jobs that hired a lot of educated people like engineers, designers, marketing types etc...then all the education in the world will do no good for economy, even in things as seemingly practical as science and engineering. Computer majors are losing their jobs to Indians they are trainging, I have two friends here in MN, one has a CS degree and works for publishing company Thomson/Reuteres/West and was running a big software dept and another works in testing for a security software firm a job she got with 2 year comm college deg and lots of grit when computing skills were in demand...both of them are training Indians that will replace their dept...for now they are told they have jobs...

Mishes post included a PhD scientist saying how there were no private sector jobs for these well-educated graduates and they were all fighting over low paying post -docs that used to be a stepping stone.

I also know lawyers that keep working judge clerkships for 5 years or more (supposed to be like an internship right of school) for 25k for the local county cause its the only job they can find, they at least have health care benes, and the are at least working, gaining experience in law...

Also, we are losing a lot of white collar jobs that employed not so educated people in middle to upper middle class jobs. A lot of my high school mates that didn't go to college but were landed in computer business in the late 80s and early 90s, that is not a great option now, also a lot of people made insane money in mortage brokerage, realty etc...and that has seriously gotten reduced.

Look at countries in third world that have low performing economies, even thos few go to college, college grads often find they can make more moeny from tips driving taxis, waiting tables, being whores (yes, I had phillipino guy friends say some of their female classmate did that to support parents etc..)...I think this is where we are trending towards.

Wed, 11/18/2009 - 13:03 | Link to Comment Anonymous
Tue, 11/17/2009 - 16:08 | Link to Comment Racer
Racer's picture

I shouldn't really be shocked by that after all I have read, but I was really really SHOCKED by the reality of it

Edit: Just had a rethink of the top 5% pay 60%......... they get to pay the most for the banksters

Tue, 11/17/2009 - 15:50 | Link to Comment DavosSherman
DavosSherman's picture

Looks like incentive to me?!?!?!

Of course, if you are Turbo Timmy Geithner you can sign a note promising to pay on income earned and then say, 'Oh, THAT was income?'

Tue, 11/17/2009 - 16:00 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

Turbo Tax Timmy in all his glory. Goes to show there are two sets of laws in America.

10 years ago I was invited by my friendly local IRS office to attend an anal exam, also know as an audit. I understood it for what it really was , a shakedown, and I made sure they found something so they'd go away happy they did their jobs.

I was fined plus I paid the tax and interest owed for a grand total of $300. Hardly worth their time but it was a shakedown after all, gotta come out of it with something.

Unfortunately I was invited back for an annual anal exam by the IRS 5 years running.

 

Tue, 11/17/2009 - 16:17 | Link to Comment D.O.D.
D.O.D.'s picture

Actually I believe after 3 years in a row it is grounds for harassment, if they aren't continuing to find discrepancies; but you should consult your attorney for more details.

Tue, 11/17/2009 - 19:24 | Link to Comment Charlie J
Charlie J's picture

I haven't been audited in a long time, and I think it's because they got nothing from me the three times they did audit.  In fact, one of those, we came up with deductions we had not used, and they had to pay us money. 

You can do that as part of an audit, and they have to pay YOU.  Save a few receipts each year for an audit, and then hit them with those.  Doesn't need to be a lot of money.  But if they see they don't get money out of you in a audit, I think you're less likely to look like a good candidate to audit.  (I have nothing to prove this theory, it's just a hunch.)

Tue, 11/17/2009 - 22:02 | Link to Comment torabora
torabora's picture

You helped the auditor shakedown artist make his numbers and get that 10% performance bonus. Way to redistribute!

Tue, 11/17/2009 - 16:48 | Link to Comment DaveyJones
DaveyJones's picture

Good to see you here Davos (dcm)

Tue, 11/17/2009 - 15:54 | Link to Comment Anonymous
Tue, 11/17/2009 - 16:51 | Link to Comment Anonymous
Tue, 11/17/2009 - 17:09 | Link to Comment Anonymous
Tue, 11/17/2009 - 19:12 | Link to Comment Anonymous
Tue, 11/17/2009 - 17:14 | Link to Comment Anonymous
Wed, 11/18/2009 - 02:29 | Link to Comment moneymutt
moneymutt's picture

i don't money hate, I do well, have lots of bones, pay lots of taxes as have no kids etc, not married to someone ...nothing wrong with being analytical and wanting a real picture...its just not who is bearing what percentage of tax burden, but what is the situation of those in 47 percent as many are likely young dependents, totally disabled, retirees, unemployed looking for work.

Good policy can only be formed based on good information, its right to disect this stuff....and typically the poor do not run media, but rather media is biased towards upper middle class and rich, so its good to ask questions about  "common" wisdom that may just be sloppy thinking or media spin...

Tue, 11/17/2009 - 15:56 | Link to Comment duckweed
duckweed's picture

"the great enemy of clear language is insincerity, when there is a gap between one's real and one's declared aims, one turns, as it were, instinctively to long words and exhausted idioms, like a cuttlefish spurting out ink" - george orwell

http://www.youtube.com/watch?v=Cd-SLRyuRq0

Tue, 11/17/2009 - 21:18 | Link to Comment Rollerball
Rollerball's picture

Here here!  Ignore the blue pill pharmacists.

http://www.youtube.com/watch?v=k5JkHBC5lDs

and/or

http://www.youtube.com/watch?v=9XVVZPefbR4

Tue, 11/17/2009 - 15:57 | Link to Comment Anonymous
Tue, 11/17/2009 - 16:00 | Link to Comment Anonymous
Tue, 11/17/2009 - 16:59 | Link to Comment Anal_yst
Anal_yst's picture

in any given year, maybe 1 person globally will make a billion dollars, maybe two (e.g. sergey brin/larry page).  I like the idea of raising the higher thresholds to say $500, $1mm, $5 or $10mm etc, but 90% is obscene.  Also you should mention the debate about the (dis)incentives taxes represent; taxing people for acheiving financial success, instead of, for example, punishing people who've attained great wealth.

Tue, 11/17/2009 - 21:54 | Link to Comment Anonymous
Wed, 11/18/2009 - 02:39 | Link to Comment moneymutt
moneymutt's picture

when the family business I work for was doing well, at the end of they year they sometimes gave us bonuses and almost always went on a mini spending spree, buying computers, building more facilities, spending money developing new products, hiring outside software vendors to make sales tools etc...and the management would always say, hey, the owners are going to lose 40 -50 percent to tax man so its better to plow it back into business, make their assets with more, increase their future income.

I'm sure the owners wouldn't agree, but I think that money did better the way they spread it around in the business then if it got spent at the spa, on a island vacation etc..

And 90 percent seems obscene compared to what we are used to, but Sweden survives it, we survived in the 50s. And when income in US was flattest (rich and poor closeest, great middle class) US had its best economic times. 

Tue, 11/17/2009 - 17:45 | Link to Comment wackyquacker
wackyquacker's picture

Why do the 'rich' always have an income above our own? Bet someone living off $40K thinks $150K would do right nicely....they might think the line gets drawn at, oh, say $75K. There's nothing to prevent you from voluntarily penning a little extra to your Uncle- bet he takes it. How about this: EVERYONE pays too much- let's stop the goddamn spending

Tue, 11/17/2009 - 19:16 | Link to Comment VegasBD
VegasBD's picture

I second your last sentence!

Wed, 11/18/2009 - 02:43 | Link to Comment moneymutt
moneymutt's picture

I agree, lets close down 1500 of the 2000 military bases/outposts we have all over the world and stop fighting wars and de-funded Blackwater....defense dept and war spending is our biggest single  Federal expense....and of course, I hope we can agree, no more big business bailouts.

Wed, 11/18/2009 - 06:49 | Link to Comment wackyquacker
wackyquacker's picture

Not a problem with me as long as we gut EVERYTHING else along with it. Enough is enough. Oh, and when some other media darling country screams help! help! this other country is being mean to us, help! we standby and watch them go into the shitter. Fair enough.

 

Me, I just want my money....oh, and Yayo too.

Tue, 11/17/2009 - 16:00 | Link to Comment Anonymous
Tue, 11/17/2009 - 16:01 | Link to Comment Anonymous
Tue, 11/17/2009 - 16:01 | Link to Comment Mad Max
Mad Max's picture

Yeah, like history usually goes - give enough to the poor to prevent riots and revolution, let the rich plunder on, and hit the middle class for the entire bill.  Destroying the middle class in the process.  This killed Rome and probably 100 other nations.  More of history repeating itself.

So, who's "Going Galt" after being reminded of this?  See Denninger's rant today of "Dear China" for a touch on this subject.

Tue, 11/17/2009 - 16:16 | Link to Comment Anonymous
Tue, 11/17/2009 - 16:44 | Link to Comment sethstorm
sethstorm's picture

Not I, for I believe that your form of strategic withdrawal (to destroy indiscriminately) will only paint a larger target on you.

 

Tue, 11/17/2009 - 17:24 | Link to Comment Mad Max
Mad Max's picture

You can start checking out without attracting any attention... especially when your pay is at least loosely correlated to hours worked and you see a declining marginal return on additional hours.

Tue, 11/17/2009 - 19:05 | Link to Comment sethstorm
sethstorm's picture

That's less "Going Galt" and more of a natural version of "work to rule".

When I hear of "Going Galt", I think of the unintended consequences that happen as a result of extreme amounts of spite.

Tue, 11/17/2009 - 21:40 | Link to Comment Mad Max
Mad Max's picture

Whatever terms you like to put on it.  Perhaps "starve the beast"?  I'm not talking about anything illegal or (IMHO) immoral.  Just recognizing a declining marginal return.

Tue, 11/17/2009 - 23:52 | Link to Comment Unscarred
Unscarred's picture

In all honesty, Max, how much longer until the people at the upper crust who have been the driver of economic growth for the past 20 to 30+ years finally decide that, given the impending depression we're facing, the pseudo-Japanese demographic shifts, and the Federal Government's catastrophic unfunded liabilities (among other reasons), that maybe relocating to Zurich (while wintering in Singapore, obviously!) is more than worth the cost of uprooting and relocating their families?

Wed, 11/18/2009 - 00:37 | Link to Comment Mad Max
Mad Max's picture

Which people are we talking about - those with 8-figure wealth and high-6 to low-7 figure income, or people who are supposedly rich by Obama's standards?  Anyway, expatriating is getting more difficult by the day.  Swiss banks won't open an account for a US citizen any more, almost regardless of the money to be deposited.  There aren't many countries that have a completely open door for a US citizen looking to just move over there.  This may well be deliberate.

Wed, 11/18/2009 - 02:08 | Link to Comment delacroix
delacroix's picture

panama

Tue, 11/17/2009 - 17:22 | Link to Comment tomdub_1024
tomdub_1024's picture

Already in progress for 3 years, left fortune 40 corp for small, local owned business (and turning down a 30% counter offer pay increase), big garden, farmers markets, barter, shop used/thrift/garage sales for as much as possible so not feeding the system buying new (sales tax, etc). We home school, so we can undo/disprove the propaganda. Also have increased my dumpster diving habit. Paying off my last credit card tonight after work....

The feeling of more freedom is worth not having the "stuff", and teaching our kids thrift/frugality and freedom via example...priceless.

Tue, 11/17/2009 - 18:06 | Link to Comment Mad Max
Mad Max's picture

My path has been extremely similar.  I think more people would find this path beneficial.

Tue, 11/17/2009 - 20:23 | Link to Comment tip e. canoe
tip e. canoe's picture

"Paying off my last credit card tonight after work...."  congrats tom!

wanna starve the beasts but do so guilt-free and legally?  tom just told ya how to do it.

besides, dumpster diving is about as fun as it gets short of jumping out of a plane. 


Tue, 11/17/2009 - 22:09 | Link to Comment tomdub_1024
tomdub_1024's picture

Thanks tip e. What a great feeling, vehicles paid for, cc's paid off, earning FAR less than your ability and still happy, yes!...we also cancelled the satellite service (is CNBC worth paying for? lol) and some other, in all reality, useless services.

Dumpster diving is like a box of chocolates...ya never know what you are gonna get...which is the fun of it...:) My 16 year old and his friends do it. Middle class folks dumpster diving..aint the US great? roflmao...:)

Now, if I could figure out how to grow Sapphire gin and good german bier (used to home brew, saving up to get back into it, figure it may be a popular barter commodity in bad times...). So I will save the good stuff for the weekends, work week = PWT beers.

Just gotta pay my protection $$$ to the fed and state to stay out of target range (you always have to pay SOMEone SOMEhow, to be left alone).

 

Crack another

 

Tue, 11/17/2009 - 23:06 | Link to Comment tip e. canoe
tip e. canoe's picture

one man's garbage is another's treasure yes?  and that's a wealth that can never be taxed.

about to brew our 1st batch of homegrown absinthe (as if reality isn't already psychedelic enough already).   maybe one day we can be left alone to do a trade...

 

Wed, 11/18/2009 - 00:40 | Link to Comment Mad Max
Mad Max's picture

Might want to consider 26 USC s. 61(a) on your first sentence.

Wed, 11/18/2009 - 08:17 | Link to Comment tip e. canoe
tip e. canoe's picture

i don't see anywhere in that clause that covers dumpster diving max.

Wed, 11/18/2009 - 02:27 | Link to Comment delacroix
delacroix's picture

most of     okay some of the people here seem pretty smart. its pretty easy to change your own oil, or get a few tools and fix your own leaky faucet, do your own drywall patch and painting. and cooking is a great place to experiment  ( the dog will always eat it ) we can get a lot less dependant now while we have the choice and means. things have changed, I don't know if I will still live here in a year, or if I will be driving the same truck. I invest  in what I can take with me at this point. maybe that will change later. I hope its not too much later.

Wed, 11/18/2009 - 03:00 | Link to Comment moneymutt
moneymutt's picture

Going Galt...please, you think that is how to get a strong, big, well-off middle class??? I get you don't want to support other lazy non-working people but the only people on welfare now are moms with young children and that lasts 5 years max, and more kids get you nothing anymore...the rest are disabled people, retirees.

Look at US economic history since the 40s...when did the middle class do the best and why? It was in the 50s and 60s and beginning of 70s. How did we get such a broad, well paid middle class then? Rich paid very high taxes comared to now, even durign Reagan era, rich paid way more than now. In the 50 and 60s, social programs for the poor and seniors were about where they are now,so its not like the tax burden on middle class was way less then.  Curioiusly, income/wages were very very flat (rich did not make much more than poor, poor were richer, rich were poorer) and unions helped raise wages and benefits for union and their competitors, non-union workers. A regular guy with a HS education could easily raise a family of four with mom at home. He could easily afford a new car on a regualr basis, a house that was paid for in 30 years or usually much less, buy food, gas etc..He had health insurance, vacations, sick days and he was supporting another adult who had free time to help community, raise children, help others with their kids (like the nieghbor hood single mom) or their elderly parent and his spouse could go into workforce and keep household together if he got sick, or spouse could take care of sick kid or parent.

We didn't get this primo situation by going Galt and being wicked selfish.. in fact businesses made less profit as they passed on a much greater percentage of their revenue with workers than business do now, people paid lots of taxes especially the rich, businesses had to tolerate unions cause law said so.

Now, people and businesses pay less in taxes, unions on decline and laws support them way less, incomes are gapped between rich and poor is more than in late 1920s, wage costs to businesses are way down, and how is the middle class doing? how are businesses doing? the businesses don't have middle class customers anymore

Wed, 11/18/2009 - 14:20 | Link to Comment tomdub_1024
tomdub_1024's picture

So let me see if I understand your post, and please correct me if I am mistaken. 

At the Fortune 40 company I used to work for, I was engineering technology to replace those "expensive workers" (to quote the VP, who had a look of fresh, glistening cat turd under her nose when speaking that phrase). And helping to offshore lots of clerical and IT jobs, so the C-level execs could make their profit (and bonuses) off the wage differential between the US and India/China. I was helping to destroy said middle-class jobs. So I am "wicked selfish" by refusing to assist meglo-corp in their destruction of the US middle class, by voluntarily simplifying my life, by choosing to step down from low upper-middle class to just middle class, by having a stay at home spouse to care for our children, by homeschooling to produce independant, critically thinking youth?

By growing my own food, I am saving thousands of gallons of petro products as my salad doesn't have to be transported 1500 miles, and teaching my kids where food REALLY comes from. And by getting the rest at farmers markets, CSA, etc, I am helping local, independant family farmers continue to exist. This is selfish?

By dumpster diving/thrift store/used items I am reducing landfill waste and energy used to produce new items (isnt "green" the meme of the times?). By barter, I am helping my local business person stay profitable (he tunes up my car, I tune up his LAN...value for value). Again, selfish?

So "going Galt" is selfish? I am just withdrawing my sanction (no I'm not a Randian, just that is such an apt description). They dont care about the middle class, in case you haven't noticed. The middle class is in their way now. I am just getting out of the way as much as possible, and assisting them as little as possible.

Are you telling me I should sacrifice my morals, my life, to assist them in destroying the life and class I grew up in? Yeah, in the 50's, 60's maybe businesses were more moral, but that aint the case now with the meglomaniac mega global corpgovs driven by the boomers (yes, I know, sweeping generalization, not all boomers are implied).

The taxes we pay enable a lot more than welfare, btw...

So, did I mis-understand you?

Wed, 11/18/2009 - 05:25 | Link to Comment JacksWastedLife
JacksWastedLife's picture

*give enough to the poor to prevent riots and revolution* - that is it.

Just rise prices on booze and turn off all stupid TV shows and 24/7 sport translations and you will get a wave of violence and criminal activity.

Look at ex-soviet block. All their potential riots were drowned in the barrels of a cheap booze.

Tue, 11/17/2009 - 16:11 | Link to Comment lieutenantjohnchard
lieutenantjohnchard's picture

"and the disappearing middle class...well, they can pay $20 for a hotdog and beer combo in Prague on that once-every-five-years vacation."

excellent. give my regards to ben chauncy gardner federal reserve smack down jake leg son of a sea bisquit azz hole twerp bernanke.

Tue, 11/17/2009 - 16:19 | Link to Comment Argonaught
Argonaught's picture

You miss the point completely if you leave out a discussion of what the gov't does with the money in any debate about the fairness of this tax or that tax.  I think even most of those shouldering the burden would complain less if the gov't spent only on its constitutional mandates (defense, infrastructure.....uh...*crickets*....).  But the money is spent on this idiot's whim or that moron's backlash.  It adds another layer to the question of fairness.

 

Wed, 11/18/2009 - 02:32 | Link to Comment delacroix
delacroix's picture

full spectrum global domination. thats where the money is going. somewhere along the way  our leaders forgot about leading us

Wed, 11/18/2009 - 02:35 | Link to Comment delacroix
delacroix's picture

we're 5% of the world population, yet we finance a military budget, bigger than the rest of the world combined

Wed, 11/18/2009 - 03:04 | Link to Comment moneymutt
moneymutt's picture

what part of empire do you not understand, you don't get half the world's resourses to go to 5 percent of the global population without might!

Tue, 11/17/2009 - 16:21 | Link to Comment Jim in MN
Jim in MN's picture

Better solution: Let the writedowns hit on bonds, allow a writeoff for the middle class.  Presto: Progressive bond haircuts.  Now THAT would soak the rich (and furriners) and be proper capitalism and good economic policy all at the same time.

I flick thee, brilliant idea, into the abyss of Teh Intertubez.....gone

Tue, 11/17/2009 - 16:27 | Link to Comment Anonymous
Tue, 11/17/2009 - 18:08 | Link to Comment Mad Max
Mad Max's picture

Do dudes A and B have equal capabilities and work ethics?  Are they doing things of equal societal value?

There are many, many overpaid people who don't contribute to societal value, but the inverse is not necessarily true.

Tue, 11/17/2009 - 18:49 | Link to Comment Anonymous
Tue, 11/17/2009 - 22:42 | Link to Comment Jeff Lebowski
Jeff Lebowski's picture

Can you come down off your pedestal for a moment, Mr. Bag on the Head?  I'd like to ask you a question.

 

How much do you aspire to make someday?  I aspire to be a top earner someday with hard work.

 

When you get there, I think you'll find that maybe your views are not quite the same.

 

I'm done, so please, back on your pedestal you go.  Let us know if it's lonely up there.

Tue, 11/17/2009 - 23:04 | Link to Comment Anonymous
Tue, 11/17/2009 - 23:45 | Link to Comment Mad Max
Mad Max's picture

You aspire to be a top earner someday, with hard work.  Bag-face likely aspires to be a top earner soon, by government arranged armed robbery of the hard work of others.  It seems that his/her type is becoming more and more common; 99% of the political class, and so much of the Baby Boomers and Gen Y it's somewhat surprising our country functions at all any more.

Wed, 11/18/2009 - 03:15 | Link to Comment moneymutt
moneymutt's picture

who wants to be  a roofer? You could offer my twice my very decent pay and I would not do it for more than a month, not that I woudl have a choice as I would not cut it physically.

I have a friend who is a public defender, she says most of her clients are roofers...as in that is the only job felons can get cause no one else wants to do it, hot dirty hard physical work.

Also, in a rich country during a good economy, most can succeed if they try...but even most educated Hatians, Chinese, Phillipino, Mexicans are not going to make nearly as much as uneducated people in US in good economy...and our lifestyle is dependent on them making less than us, them making very little from their mineral  resources etc..we get cheap goods...notice how we complain about how expensive plumbers are compared to the cost of a computer...its because plumber is American citizen making a decent wage...

So I think its arrogant to think those making more money than lower wage workers to think they "deserve" it more cause they are so feaking special and apparently work so much harder than a roofer or a PhD taxi cab driver in Thailand...whatever...keep thinking you are special if you need that to get you thru they day, just don't get a leak in your roof

Tue, 11/17/2009 - 16:31 | Link to Comment faustian bargain
faustian bargain's picture

Another point that I think may be getting less attention than it should, is that income taxes are only a (small? I don't know the numbers) part of federal revenues. Just for instance, the Fed's moneyprinting mechanism...the invisible tax. Get rid of this wealth-sucking monster, and the political desirability of massive spending programs gets reduced big-time, due to the fact that the true cost of said programs will be seen in the tax liability.

I get the feeling Obama had a little consult with Bernanke before he made his 'no raising taxes on the middle class' campaign promise. "Say, Ben, we can pay for this new budget can't we?" "No problem, Big O."

Tue, 11/17/2009 - 16:55 | Link to Comment Jim in MN
Jim in MN's picture

What, raise current taxes to pay for Wall Street's 'triple bonus bailouts' instead of hiding it for our children to pay later?  Intolerable honesty!  Intolerable!

Tue, 11/17/2009 - 17:32 | Link to Comment faustian bargain
faustian bargain's picture

End the Fed, Make Honesty Tolerable Again.

Tue, 11/17/2009 - 19:54 | Link to Comment Jerome Lester H...
Jerome Lester Horwitz's picture

While everyone is arguing the finer points of the income tax and payroll tax the federal government in collusion with the federal reserve continues to steal wealth from people of all income levels through the invisible tax known as inflation which is the direct result of the fed creating money out of nothing and loaning it to the federal government at interest. I still think that there should be no payroll deductions at all for any taxes and that people should have to send a payment to whatever taxing body lays a claim to a portion of ones wages either monthly or quarterly. This would force people to elect good stewards oof their money sent to the government in the form of taxes.

Tue, 11/17/2009 - 16:34 | Link to Comment Anonymous
Tue, 11/17/2009 - 16:41 | Link to Comment Anonymous
Tue, 11/17/2009 - 16:53 | Link to Comment Banker1944
Banker1944's picture

The demise of the republic is upon us. Less and less voters contribute and more and more voters take a free ride. Corrupt politicians love to cater to  free riders, brothers of sorts. Only a flat tax can alter this situation and return sanity to the financial well being of the country. Soaking the rich is counterproductive as much as supporting people with lower income with government subsidies. Such subsidies are corrosive to the dignity and well being of the people.

Tue, 11/17/2009 - 17:05 | Link to Comment Jim in MN
Jim in MN's picture

The flat tax idea died when analysis was leaked to The Washington Post circa 1995 showing that it eliminates the mortgage interest deduction.  Oops.  Rarely has it been seen since.

Personally I think that proper, boring old progressive taxation is the foundation of the proper republic, the one fought for and attained for a brief time in the last century.  We have simply allowed too many to scoff at it.  I too would  like to see a trend analysis of the data in the posted graphic.  I bet the top brackets pay far less than their share today--a debate on fairness (and I do respect opposing viewpoints on such things) being one of the last things you'll ever hear in the media today.  Even rarer, surely, than mention of the flat tax, or unicorns. 

Vampires, now those we got plenty of!  Vampires, baby, are sexy!!! 

Tue, 11/17/2009 - 17:08 | Link to Comment chet
chet's picture

Not paying federal taxes and getting a "free ride" are two different things.  One could work everyday, with earnings so low that they owe no taxes, but not receive any additional subsidies or benefits. 

While that person may be getting a "free ride" on paying for national defense, for instance, it's still a person who works full time, takes care of a family, etc.  Plus, they can't avoid many state and local taxes, or a sales tax.

The true thing missing from this analysis is how the distorted tax revenue compares to income distribultion.  How much of national income do those 5% of taxpayers account for?  Naturally, people with much more income pay much more income tax.

Wed, 11/18/2009 - 03:18 | Link to Comment moneymutt
moneymutt's picture

don't forget fica...you don't ahve to pay fica on dividends, capital gains, interest income, only on wages. You don't have to pay fica after 100k in wages.

Tue, 11/17/2009 - 16:53 | Link to Comment delacroix
delacroix's picture

inflation is a tax,  39 cents a gallon gas tax  9% sales tax , property tax, social security deductions, if you live to collect it or not. they're not going to re-imburse your heirs. inheritance tax, state tax. local taxes and bond issues on your property tax bill.dmv fees way beyond reason, theres even tax fees on your cell phone bill.  the poor get taxed, to the very limit of their ability to pay. and don't get me started on traffic fines, and court fees.

Wed, 11/18/2009 - 00:31 | Link to Comment Anonymous
Tue, 11/17/2009 - 16:55 | Link to Comment Anonymous
Tue, 11/17/2009 - 18:04 | Link to Comment Argonaught
Argonaught's picture

Epic fail is right, anonymous dumb-dumb!  I haven't had a 10% tax rate since I was in college (although I guess I was just born to early...my nephew has a negative tax rate because he was bright enough to have a child whilst living without income).  Try the same math with 30k @ 10% vs 3 mil at 39% (not 100% accurate blended rate, but close enough).

If you want to argue that no one should make 3M that's a different argument.  Your side has won in France.  Enjoy the food.  A flat tax, no deductions/no shelters, is far more fair than a progressive tax system.

Tue, 11/17/2009 - 18:21 | Link to Comment Anonymous
Tue, 11/17/2009 - 18:45 | Link to Comment Argonaught
Argonaught's picture

Hop off the 'medical' maryjane, dude.  The two don't pay the SAME percent...your entire argument is based on a premise that doesn't exist.

Tue, 11/17/2009 - 19:26 | Link to Comment Anonymous
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