This page has been archived and commenting is disabled.

Guest Post: Should The Rich Pay More Taxes?

Tyler Durden's picture




 

Submitted by Azizonomics

Should The Rich Pay More Taxes?

It’s a multi-dimensional question.

The left says yes — income inequality has soared in recent years, and the way to address it (supposedly) is to tax the rich and capital gains at a higher rate. The right says no — that the rich already create more jobs and wealth, because they spend more money, and why (supposedly) should they pay more tax when they already pay far higher figures than lower-income workers?

Paul Krugman made the point yesterday that the tax rate on the top earners during the post-war boom was 91%, seeming to infer that a return to such rates would be good for the economy.

Yet if we want to raise more revenue, historically it doesn’t really seem to matter what the top tax rate is:

Federal revenues have hovered close to 20% of GDP whatever the tax rate on the richest few.

This seems to be because of what is known as the Laffer-Khaldun effect: the higher rates go, the more incentive for tax avoidance and tax evasion.

And while income inequality has risen in recent years, the top-earners share of tax revenue has risen in step:

So the richest 1% are already contributing around 40% of the tax revenue, taxed on their 34% share of the national income. And even if the Treasury collected every cent the top 1% earned, America would still be running huge deficits.

Yet the Occupy movement are still angry. A large majority of Americans believe the richest should pay more tax. More and more wealthy Americans — starting with Warren Buffett, and most recently Stephen King are demanding to pay more taxes.

King writes:

At a rally in Florida (to support collective bargaining and to express the socialist view that firing teachers with experience was sort of a bad idea), I pointed out that I was paying taxes of roughly 28 percent on my income. My question was, “How come I’m not paying 50?”

How come? Well, the data shows pretty clearly that it’s unlikely that revenues would increase.

They may have a fair point that capital gains above a certain threshold should probably be taxed at the same rate as income, because it is effectively the same thing. And why should government policy encourage investment above labour by taxing one more leniently?

But more simply, people like King think the status quo  is unjust far beyond the taxation structure. A lot of people are unemployed:

A lot of people are earning less than they were five years ago:

28% of homeowners are underwater on their mortgages. Millions of graduates face a mountain of student debt, while stuck in dole queues or in a dead end job like Starbucks.

We live in dark times.

From Reuters:

Nearly 15 percent of people worldwide believe the world will end during their lifetime and 10 percent think the Mayan calendar could signify it will happen in 2012, according to a new poll.

With all this hurt, there’s a lot of anger in society. Those calling for taxing the richest more are not doing the same cost-benefit analysis I am doing that suggests that raising taxes won’t raise more revenue.

But they’re not unfairly looking for a scapegoat, either. While probably the greatest culprits for the problems of recent are in government (Bush, Greenspan, Obama, Bernanke) Americans are right to be mad at the rich.

Why?

This isn’t about tax. This is about jobs, and growth.

The rich, above and beyond any other group have the ability to ameliorate the economic malaise by spending and creating jobs, creating new products and new wealth. The top 1% control 42% of all financial wealth. But that money isn’t moving very much at all— the velocity of money is at historic lows. It should not be surprising that growth remains depressed and unemployment remains stubbornly high.

And every month that unemployment remains elevated is another month that the job creators are not doing their job. Every month that the malaise festers, the angrier the 99% gets.  It is, I think, in the best interests of the rich to try and create as many jobs and as much wealth as they can. Class warfare is ugly. A divided and angry society, I think, will find it even more difficult to grow and produce.

So raising tax rates is not guaranteed to raise revenues, and cannot address the problem of deficits. America needs the richest Americans to pay more tax dollars — but only as a side-effect of producing more, and creating growth. 

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Thu, 05/03/2012 - 11:33 | 2393914 Temporalist
Temporalist's picture

The rich will just take bigger writeoffs like Yelp.  What a winner...for being such a loser.

Thu, 05/03/2012 - 11:39 | 2393937 Pladizow
Thu, 05/03/2012 - 16:09 | 2395039 Whiner
Whiner's picture

Thanks Tony.you have proved that USA is bankrupt. To come out of the hole Obummer will leave us in, we will have to confiscate 50% of all net worth of each citizen. Problem: can't and won't happen. Wait on hyper inflation. Pay off in one day, all wealth vaporized. Start over with real money backed by PMs. Population will drop by 30%. Take the rest of the wealth to bury the dead and rebuild essential infrastructure and fund military government

Thu, 05/03/2012 - 18:57 | 2395428 smiler03
smiler03's picture

 "Nearly 15 percent of people worldwide believe the world will end during their lifetime and 10 percent think the Mayan calendar could signify it will happen in 2012, according to a new poll."

The weak minded devout christians agree completely.

Thu, 05/03/2012 - 19:51 | 2395502 GernB
GernB's picture

Sounds more like the flaky new age progressives to me.

Thu, 05/03/2012 - 11:42 | 2393949 NewAmericaNow
NewAmericaNow's picture

When taking from Paul to give to Peter, you will always have the support of Peter.

Thu, 05/03/2012 - 12:01 | 2394053 Buckaroo Banzai
Buckaroo Banzai's picture

Arguing about who among us should pay the most income tax, and how we should calculate it, is like a bunch of slaves crying over who gets the heaviest chains.

YOU ARE ALL FUCKING SLAVES as long as there is an income tax on productive natural persons. The only ones who aren't slaves are the ones who produce nothing.

How perverted is that? Think about the kind of incentives a system like this engenders. And people have the nerve to wonder why the economy is falling apart.

Thu, 05/03/2012 - 12:04 | 2394064 crawldaddy
crawldaddy's picture

bullshit, the .01% control and run the govt, they are the puppet masters. The ultra rich like always, ARE the problem.

Thu, 05/03/2012 - 12:30 | 2394161 alangreedspank
alangreedspank's picture

Yes, "control" our desperate to do good policitians. *Sigh*

Thu, 05/03/2012 - 13:01 | 2394258 A Nanny Moose
A Nanny Moose's picture

A bunch of people with capital, control a bunch of people with all the guns...

Yes, that must be it.

 

Thu, 05/03/2012 - 15:27 | 2394905 Umh
Umh's picture

Or maybe it's the other way around. The people with guns & laws control who has the capital.

Thu, 05/03/2012 - 13:27 | 2394392 Buckaroo Banzai
Buckaroo Banzai's picture

So on the one hand you say that the rich have all the power, and on the other hand, you say that we need to tax the rich?

Don't be an ass. If they have the power, do you really think they would allow this to be implemented in any kind of practical way?

On the other hand, did you stop to consider that this "tax the rich" meme might be the kind of strategy they'd employ to (a) confuse people like you and (b) use as a tool to strip the middle class of their wealth. Because it's the middle class that represents the real threat to these people.

Like a 10-year-old at a magic show, you are listening to what they say, and always looking at the wrong hand, and not paying attention to what they are actually doing.

Thu, 05/03/2012 - 12:34 | 2394176 Clampit
Clampit's picture

Too bad Peter doens't realize he's using Paul's currency. Take all you want, we'll print more.

And from the article:

The rich, above and beyond any other group have the ability to ameliorate the economic malaise by spending and creating jobs, creating new products and new wealth.

Yeah, dreaming up diamond encrusted, wifi enabled automatic tonail clippers isn't exactly my idea of job satisifaction.

Thu, 05/03/2012 - 13:50 | 2394518 IBelieveInMagic
IBelieveInMagic's picture

$600 million tax free Hank Paulson, $200 million Stan O'Neill, etc. is fully earned and deserved. Anybody who does not agree is an envious git.

Thu, 05/03/2012 - 12:37 | 2394180 vast-dom
vast-dom's picture

Stop taxation, end the fed and the economy will stabilize and become productive again. 

Do a real cost benefit and you shall see how increased disposable income vs. taxation will actually benefit the economy. the gov can print money and sell bonds to maintain the bare min to run itself, which means it would have to do more basic honest regulating and almost no meddling in business ie markets. That won't happen though unless there is huge revolt...

Thu, 05/03/2012 - 20:36 | 2395552 StychoKiller
StychoKiller's picture

"Congress shall make no Law abridging the freedom of production and trade." -- "Atlas Shrugged"

Thu, 05/03/2012 - 13:33 | 2394422 kubrick007
kubrick007's picture

Another BS story about taxes.

 

Most of the "rich" (assume $1 million per year income) are incorporated via LLC, S(Corp), etc. When you raise the tax rate on their net income, all you do is encourage them to spend more money into their business via hiring people, buying capital equipment... as this ends up in the expense column and reduces their net income.

 

For ex, imagine business owner with following:

 

Revenue $2 million

Costs $1 million

Net income = $1 million

 

At a tax rate of 30%, this owner has $700k post-tax for personal expenses to invest in stocks, bonds, currency, art, real estate, money market, etc. This owner prefers to be taxed and keep his cash for stocks etc.

 

At a tax rate of 60%, this owner has only $400k post-tax for personal expenses to invest in stocks, bonds, currency, art, real estate, money market, etc (not quite as much left over). This owner will prefer to invest more into his business as he will be taxed at such a high-rate that it will be difficult to make up the tax loss.

 

 

Higher tax rates cause business owners to try to decrease their net income and thereby it actually results in increased jobs

Thu, 05/03/2012 - 15:52 | 2394977 Itinerant
Itinerant's picture

Amen.

This article again concentrates on income tax. But total tax revenues (including municipal and states) shows that the tax burden is far more evenly distributed than partial comparisons suggest.

Arguing about how much revenue extra taxation on the rich would generate is besides the point. This article again speaks of investment and rich people "spending money", but no distinction is made between investing in production of goods and services and investment in debt multiplication (bidding up the price of assets, gaming the system for rentier income extraction). Taxes are not just about revenue from rich people, they are about incentives and relative price (encourage/discourage), and therefore about the structure of the economy.

It's absolutely crazy to think that there is a lot of unemployment and poverty (and thus higher taxes and support programs) because there is a dearth of rich people spending enough money to create jobs. Do people seriously think national income and wealth would go down if those rich people went on vacation to the South Pole, abandoning their assets, forcing us to do something else with them ???

Thu, 05/03/2012 - 20:40 | 2395557 StychoKiller
StychoKiller's picture

"But you say that money is made by the strong at the expense of the weak?  What strength do you mean?  It is not the strength of guns or muscles.  Wealth is the product of man's capacity to think.  Then is money made by the man who invents a motor at the expense of those who did not invent it?  Is money made by the intelligent at the expense of the fools?  By the able at the expense of the incompetent?  By the ambitious at the expense of the lazy?  Money is made--before it can be looted or mooched--made by the effort of every honest man, each to the extent of his ability.  An honest man is one who knows that he can't consume more than he has produced."

-- Francisco d'Anconia, "Atlas Shrugged"

Thu, 05/03/2012 - 18:42 | 2395417 midtowng
midtowng's picture

The rich are creating jobs all right - OVERSEAS!

What's more, the rich are paying a lower effective tax rate than middle income people. How can that possibly be fair?

Thu, 05/03/2012 - 21:00 | 2395589 CommonSense89
CommonSense89's picture

Please provide proof that the top 1% or 5% pays a lower effective federal tax rate than any other group. Every study I've seen shows a nearly perfect correlation between share of national wealth and corresponding effective federal tax rate

Thu, 05/03/2012 - 21:06 | 2395598 Stuck on Zero
Stuck on Zero's picture

So true.  And I love this statement:

"The rich, above and beyond any other group have the ability to ameliorate the economic malaise by spending and creating jobs, creating new products and new wealth."

Horse poopies.  The rich never, ever risk their own money.  The rich protect their money and use other people's money.  I've worked with dozens of very rich "investors" and none of them ever used their own money in any way, shape, or form.  They would always use their "name", take a big cut, and bring in other investors of lesser means.  May I name a few names, like Donald Trump.  He's rich and all the suckers he got to invest in his vast enterprises took baths.  No.  The rich don't create jobs.  They wheel and deal.  The hard working enterprise class does the investing.  I guess you'd call them the top 10%.

Thu, 05/03/2012 - 11:33 | 2393915 Payne
Payne's picture

Disband the Federal Government !  Imagine all the jobs that will be created without a bloated bureaucracy.

Thu, 05/03/2012 - 18:43 | 2395418 midtowng
midtowng's picture

It certainly worked in Somalia

Thu, 05/03/2012 - 20:42 | 2395560 StychoKiller
StychoKiller's picture

Somalia has Chaos, NOT Anarchy; there is a difference.

http://pixel420.com/pixel420/stateless/

Thu, 05/03/2012 - 21:44 | 2395661 traderjoe
traderjoe's picture

Thank you.

Thu, 05/03/2012 - 11:33 | 2393917 Marco
Marco's picture

The rich have no more ability to make oil appear out of nowhere than the poor ... so no, they can't create growth.

Thu, 05/03/2012 - 11:39 | 2393936 AnAnonymous
AnAnonymous's picture

Ummmm, how rude.

As an expansionist, I shall discard any fact, point that confirms that expansion can not be maintained and has entered stagnation stage.

I want to expand, and as such, I'll only endorse stories that tells me expansion is kicking.

Signed:a polite US citizen, who dismisses reality as rude, as any US citizen does.

Thu, 05/03/2012 - 11:44 | 2393966 NidStyles
NidStyles's picture

WTF does Oil have to do with economic growth?

 

I know you'll probably throw that Peak-Oil and look at the fuel prices line at me, so I will just head you off at the pass. The price for Gasoline is being directly effected by the quantity of currency in circulation. To put it simply so any idiot can understand it, the Government, along with the Federal Reserve is the reason the oil and fuel prices are so high.

Thu, 05/03/2012 - 13:49 | 2394512 The_Nihilist
The_Nihilist's picture

Funny how people down vote you for speaking truth. The money printing by all central banks of the world is because of peak oil. Some how they believe if they print enough money more oil will magically appear. Remember a barrel of oil was $25 in 2002, in 2008 it was $140 almost 6 times as much in just 6 years. There was no massive money printing then either. The DOD is predicting a 10 mbpd shortfall in global supply by 2015 which you can read here http://www.jfcom.mil/newslink/storyarchive/2010/JOE_2010_o.pdf. Many people talk shit on Hubbert yet he accurately predicted the peak of US oil production back in the 70s yet people still don't believe him 40 years on. Keep your rose colored glasses on as long as you can cause in a decade it will cost more to drive to and from work than you will make at that job. Peak oil doesn't care if you believe in him or not, he believes in you.

Thu, 05/03/2012 - 11:37 | 2393932 LawsofPhysics
LawsofPhysics's picture

"This isn’t about tax. This is about jobs, and growth."

 

Correct, and real growth is not possible in the absence of an increase in the input and flux of all resources (not simply oil) through the system.  Hedge accordingly.

Thu, 05/03/2012 - 12:09 | 2394084 pods
pods's picture

I love these silly arguments about taxes.  Sure, taxes suck.  We got that.
But taxes are funding less and less of the Fed.gov.  And certainly are not going to fund our liabilities.

Chicanery and money printing runs our government.

Taxes are merely to keep us fighting each other instead of actually thinking about how far our servant government has overstepped it's delineated boundaries.

pods 

Thu, 05/03/2012 - 12:28 | 2394153 AnAnonymous
AnAnonymous's picture

Taxes are merely to keep us fighting each other instead of actually thinking about how far our servant government has overstepped it's delineated boundaries.

_________________________________________

Correct, correct. It reminds of that hockey player's comments on how he figured out that the government has grown big enough to steal etc... this living in the US of A which knows nothing about theft and land grabbing.

US citizenism has not changed one bit since its inception.

Thu, 05/03/2012 - 13:03 | 2394292 A Nanny Moose
A Nanny Moose's picture

Government....our servant. Bwahahaha!!! That's rich

Thu, 05/03/2012 - 14:44 | 2394776 pods
pods's picture

Well in practice it is not that way, but if you look at the document that founded our government:

"We the people of the united states....."

We the people are where the government came from.  We delegated some of our power to the collective government.  
Just because it is not that way now does not mean we should merely embrace this. We must let them know at every turn that they are OUR servants, and that we the people will do whatever it takes to cram our servant government back into the funtions, and only the functions that we have delegated to it.

pods 

Thu, 05/03/2012 - 19:24 | 2395461 smiler03
smiler03's picture

 "We The People....."

Actually spouted by very few.

Who was the Senate composed of? Who elected them? 

The whole Constitution of the US had about as much mandate as Gordon Brown of the UK had to "Obama" the UK economy.

It's all bollocks that 50% of you want to break from and 50% of you want to keep because you believe that it is a God given right to let you own lots of guns.

Ha ha, that should get more downvotes than anne ananonymous us citizenism bloke.

Thu, 05/03/2012 - 14:03 | 2394604 sgt_doom
sgt_doom's picture

Ya know, this morning I heard two ultra-airhead females (if they were guys I would refer to them as vagina girls, but these two idiots weren't intellectually capable of locating their own vaginas) on some moronic NPR show (The Takeaway, and I wish they were gone) discussing this.

The hedge fund airhead stated:

"Profits, as a percentage of the GDP, are at an all-time high."

"While wages, as a percentage of the GDP, are an an all-time low."

Duuuuuuh.....those profits, though, are based upon the packaging, and endless repackaging, of debt:  the fantasy finance sector.

Also, profits are at an all-time high precisely because wages are at an all-time low --- due to decades of labor arbitrage (offshoring of jobs, importing of foreign scab workers) resulting in labor deflation.

Evidently neither of those two airheads, like Paul Krugman, can't do arithmetic ---- it's just toooooo haarrrrd for them....

Thu, 05/03/2012 - 19:33 | 2395470 smiler03
smiler03's picture

It begs the question... "why the heck were you listening to it?".

Their "most commented on" article is this.... see if you can spot a female link here.....

""Girls," written by and starring Lena Dunham, was initially the subject of overwhelming praise for telling the story of twenty-something New York females in a new way. Media outlets scrambled to nail down a Dunham interview. And we were lucky to be one of the shows to talk with her."

I think I should refer to you as a penis boy, or perhaps sergeant dickhead would be more appropriate.

Thu, 05/03/2012 - 20:45 | 2395567 StychoKiller
StychoKiller's picture

The edges of the Petri dish are hard and cold!  Conclusion:  The surface of a planet is NOT the correct place for an expanding, technological civilization.

Time to leave the cradle.

Thu, 05/03/2012 - 11:40 | 2393940 lolmao500
lolmao500's picture

It's not about taxes, it's about spending.

Anyway, the rich need their money to build bunkers...

http://www.bbc.co.uk/news/world-europe-17937795

Russia warns on missile defence deal with Nato and US

Russia says it is prepared to use "destructive force pre-emptively" if the US goes ahead with controversial plans for a missile defence system based in Central Europe.

The warning came after the Russian defence minister said talks on missile defence were nearing a dead end.

Moscow fears that missile interceptors would be a threat to Russia's security.

But the US and Nato say they are intended to protect against attacks from Iran or North Korea.

"A decision to use destructive force pre-emptively will be taken if the situation worsens," chief of the Russian defence staff Gen Nikolai Makarov said.

Thu, 05/03/2012 - 12:05 | 2394066 Bartanist
Bartanist's picture

... and it was recently published that an old "off inventory" nuclear weapon left Germany by submarine for an undisclosed destination. Maybe Chicago for the NATO summit false flag? Maybe to the Persian Gulf to stage a false flag? Maybe to be used to create another tsunami off Japan (9.0 my furry butt)?

Thu, 05/03/2012 - 12:11 | 2394086 AnAnonymous
AnAnonymous's picture

Anyway, the rich need their money to build bunkers...

_______________________________________

They cant buy discount price one of those fallout shelters built by US of A us citizen middle class?

Thu, 05/03/2012 - 21:00 | 2395590 nmewn
nmewn's picture

They're all made in China now  by chinese citizen citizenism cynism as dictated from on high by the lap dog lackey politburo citizenship...we here call them coffins.

Real bunkers are made by Americans for Americans.

Thu, 05/03/2012 - 11:40 | 2393941 El Viejo
El Viejo's picture

Its not about revenge or blame or anything other than getting taxes from the place that would have the least negative effect on the economy and giving tax breaks to those who would actually consume.

http://www.cbpp.org/cms/index.cfm?fa=archivePage&id=3-29-07inc.htm
http://www.cbpp.org/cms/index.cfm?fa=view&id=2908

And puhleeze don't give me that crap about the rich creating jobs. They put their money into hedge funds cause that's a lot easier.

Thu, 05/03/2012 - 11:51 | 2393993 Woodyg
Woodyg's picture

Tax the Hell out of the rich
1. just watch Housewives of Beverely Hills etc for a reason to tax the rich......
2. Most jobs are created by small businesses where the owners make less than a million a year
3. They'll have less money to buy off politicians
4. The ultra wealthy use their money to buyout, Consolidate, layoff American workers, outsource and hide their wealth.....
5. The rich don't want to get their hands dirty doing Actual work - financialization is their game - which does NOTHING but decrease true economic output
6. An economic system that gives basically ALL of the gains from growth to one very small segment of society is By Definition Flawed and Corrupt.
7. The rich gamed the economic system by buying off politicians....

Tax the rich or face violent revolution.......

For the last 30 years the rich have taken All the gains from growth.....
Imagine the whining and crying they'd engage in If the tables were turned and the bottom 90% received all the gains from growth.

The rich are weak and pathetic and couldnt make it if Real Work was required or they couldn't buy off and bribe the kletocratic politicians....

Eat the Rich!

Or tax the rich - it's their choice but soon it will be ne or the other......

Not a great system to create Actual wealth

Thu, 05/03/2012 - 12:06 | 2394072 mayhem_korner
mayhem_korner's picture

The rich gamed the economic system by buying off politicians....

 

I love it when folks who make less than I pay in taxes come out with the bumper-sticker tag lines.  When you all realize that not everyone "wealthy" cheated to get there, then maybe a normal conversation can ensue...

Thu, 05/03/2012 - 12:13 | 2394093 AnAnonymous
AnAnonymous's picture

Yep, some are free riders. They let the others do the job and benefit from it. Flock style effect.

Keeping hands clean...

Thu, 05/03/2012 - 13:22 | 2394365 TheFourthStooge-ing
TheFourthStooge-ing's picture

AnAnonymous said:

Yep, some are free riders. They let the others do the job and benefit from it. Flock style effect.

In Chinese citizenism land of face savery, it is called Fox Conn effect.

Keeping hands clean...

Ah, ah, Chinese citizenism citizen keeping hands clean by not wiping after roadside crap making.

As for cleanliness of other than hands...

 

Thu, 05/03/2012 - 12:21 | 2394130 Woodyg
Woodyg's picture

Funny you bitch about bumper sticker tag lines then Add one of your own.....

Besides I mentioned multiple reasons.....

Bite me!

If you don't think the rich have ought off the politicians thru bribes you're an idiot

Thu, 05/03/2012 - 12:26 | 2394149 mayhem_korner
mayhem_korner's picture

If you don't think the rich have ought off the politicians thru bribes you're an idiot

 

Not all of them.  See the difference is you're guessing, I'm not.

Thu, 05/03/2012 - 12:48 | 2394223 Beam Me Up Scotty
Beam Me Up Scotty's picture

You throw "tax the rich" out there like you are talking about Warren Buffet.  You realize the "tax the rich" proposal would jack a married couple making over $250,000 (thats 250 THOUSAND dollars--not MILLION) into the highest tax bracket?  You think that a married couple with 2 kids making $250K is living anywhere near a Warren Buffet lifestyle?

BWAAAAHHHHAAAHAHHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHA!!!

Thu, 05/03/2012 - 13:41 | 2394469 Beam Me Up Scotty
Beam Me Up Scotty's picture

Nice, a junk from some Occupy asshole who wants to sit in the park all day and paint pictures of clouds and trees, and collect a nice check from the government.  Get a job you lazy fuck.

Thu, 05/03/2012 - 20:00 | 2395514 mayhem_korner
mayhem_korner's picture

 

 

 

You buy into that bait there, Rocky?

Why don't you look up the tab that Moochelle Hussein has racked up in Spain, at Macy's, and don't forget about her daughters' little jaunt in Mexico...all on the taxpayers' dime. 

Thu, 05/03/2012 - 12:16 | 2394108 Chump
Chump's picture

A better idea would simply be to stop fueling "growth" through debt and quit bailing out shitty businesses.  Then you have the freedom to succeed or fail on your own.  Just taxing the rich because you don't like some reality TV show is beyond stupid.  Moreover, you lay the seeds of your own failure when you make some exemption for people because they're not that rich, they only make less than a million dollars a year.  Hell, even 200K/year sounds pretty damn rich to me, why can't we tax those evil fuckers too?  See where this is going?

Your solution here amounts to putting a bandaid on arterial bleeding and calling it good.

Thu, 05/03/2012 - 20:54 | 2395576 StychoKiller
StychoKiller's picture

It's my understanding that a bunch of crabs in a bucket will pull back in any crab that's attempting to escape.  Perhaps a good solution to the taxation problem is large-key encryption for every financial transaction (especially paychecks!).  The IRS cannot tax when they do not have information on what someone might owe.

Thu, 05/03/2012 - 12:45 | 2394211 ElvisDog
ElvisDog's picture

Tax the Hell out of the rich

I think that the truly rich don't care about income tax rates, because they have already made their fortunes. Much of their income comes from capital gains rather than wages. If you really want to "tax the rich" why not impose a 2% annual tax on assets, both held here and overseas? And to counter the rich just relocating overseas, the tax could be imposed on anyone who does business in the U.S. I suspect Warren Buffett would squeal like a stuck pig over an asset tax.

Thu, 05/03/2012 - 15:51 | 2394968 Umh
Umh's picture

You could just save some trouble and paperwork by just taking the asset all at once instead of in 2% chunks.

 

Thu, 05/03/2012 - 20:56 | 2395580 StychoKiller
StychoKiller's picture

The same thing could be accomplished by placing a sliding expiration date on Munny, the larger the pile the shorter the time period.

Thu, 05/03/2012 - 13:23 | 2394377 A Nanny Moose
A Nanny Moose's picture

just watch Housewives of Beverely Hills etc for a reason to tax the rich.

A fool and his money are soon parted. You should be happy that such fools exist. They are an easy oportunity

They'll have less money to buy off politicians

So give more tax money to politicians, to prevent politicians from being bought. Where do you think all those tax dollars will go...some poor farmer in Nebraska....or Monsanto....or Warren Buff-It? The politicians won't use it to enrich their buddies by...building bridges to nowhere? Building things that explode? Bailing out bad bets?

Where do you think SOME of these people got some of this wealth in the first place? Do you really think they were capable of creating value on their own?

 

Thu, 05/03/2012 - 12:25 | 2394147 JamesBond
JamesBond's picture

embecile

you have no clue about economies    

Thu, 05/03/2012 - 11:41 | 2393942 EscapeKey
EscapeKey's picture

I don't have a problem with rich people. I have a problem with rich people being bailed out when they lose on their bets.

Thu, 05/03/2012 - 11:43 | 2393960 odatruf
odatruf's picture

+1  This precise notion is the one that ought to unite the Tea Party, the Occupy crowd and anyone else sick and tired of the elite political class keeping the party rolling along.

Thu, 05/03/2012 - 11:46 | 2393977 NidStyles
NidStyles's picture

Fuck collectivism, that's what created this mess in the first place.

Thu, 05/03/2012 - 11:49 | 2393992 NotApplicable
NotApplicable's picture

ALL herds are assembled for one reason.

Slaughter day.

Thu, 05/03/2012 - 12:43 | 2394198 Temporalist
Temporalist's picture

Two reasons really, slaughter and breeding.

Thu, 05/03/2012 - 11:56 | 2394016 kridkrid
kridkrid's picture

that is why, no matter how legitimate the origin of either movement may have been, it was so important for the existing political apparatus to consume them both.  The R's consumed the Tea Party, and the D's have basically consumed the OWS (though perhaps not as fully or as systematically as the tea party).  I would also accept an argument that neither movement was fully legit to begin with... but I'm not sure if that even matters.

Not only is there no unity between the two, there is animosity.  And that's how it always works... pit the poor vs. the poor.  Same as it ever was.

Thu, 05/03/2012 - 12:27 | 2394150 pods
pods's picture

Yeah, but on the flip side, if the TEA party and OWS would sit down and realize that they are basically upset about the same thing, then they could join.

And as soon as they join and become powerful, then they become co-opted.

The whole paradigm is broken.  

I try to do my part by being "that crazy guy" who can steer any topic back to money within a sentence or two.

That Kevin Bacon game is child's play!

(I know you know exactly what I mean)

pods

Thu, 05/03/2012 - 12:51 | 2394242 Temporalist
Temporalist's picture

Unfortunately outsiders can see the two are after similar macro goals but the participants don't see it.  Tea Party is about cutting spending and size of government and cutting welfare and the OWS more often is about giving more to the working class, forgiving debt to students, jailing kleptocrats and increasing regulation (or bigger government).

The Tea Party is less concerned about civil rights issues though and the OWS is willing to speak louder and go to jail for their beliefs plus they are younger and organize quicker.

Without a doubt both have been infiltrated by spy/information agency types who will also try to steer them in a specific direction like they have done with government coups around the world for decades.

I think the biggest asset that both movements have is their decentralized power structure...you'd think that the OWS people would learn the lesson from that that centralized power is a bad thing but that's too much to ask.

Thu, 05/03/2012 - 13:06 | 2394297 pods
pods's picture

You picked up on a great point about OWS.  When it started, it was said there was no leadership or coherent message. I saw that as their greatest asset.

No leader, no one to bribe or blackmail.  No fixed message, no way to steer the group back to the synthesis (hegel).

People being upset and insatiable is the greatest problem for them.  And a great asset to us.

I heard on the radio this morning where a caller was admonishing a guest because the guest would not vote for Romney, instead he would withhold a vote.  The guest (Greg Brannon of Founder's Truth) was well read on the constitution and drove home the need to force pols to uphold the constitution.  

The "vote for the lesser evil" mantra is wearing thin, and people are waking up that there is no difference between the major candidates except for the icing.

Of course, most people do not want a constitutional government, they merely want to control the government we have.

pods

 

Thu, 05/03/2012 - 14:47 | 2394780 kridkrid
kridkrid's picture

we do fight the same battle.  maybe we should take shifts.  :-)

Thu, 05/03/2012 - 11:47 | 2393985 Harlequin001
Harlequin001's picture

Do you have a problem then with poor people being bailed out on their pension fund investments and bank deposits? Just askin'...

Thu, 05/03/2012 - 11:50 | 2393997 Dr. Engali
Dr. Engali's picture

I have a problem with bail outs of any kind. But to be fair it wasn't the poor people who put us in this mess.

Thu, 05/03/2012 - 12:14 | 2394101 AnAnonymous
AnAnonymous's picture

To be fair, neither the rich. If you want to stick to fairness...

Thu, 05/03/2012 - 13:59 | 2394548 Harlequin001
Harlequin001's picture

Well  Dr Engali it was the poor people who demanded welfare of all types, it was the poor people who voted for any politician promising to give it to them, and when they couldn't pay for it they borrowed so that everyone could have it for free. That's why we have so much debt in the first place.

Rich people didn't need it.

Thu, 05/03/2012 - 23:11 | 2395792 Bohm Squad
Bohm Squad's picture

+1

And the of course the home loans with the low intro rate set to reset ASAP.

Banker:  "We can lower your payment with an ARM."

Buyer:  "Won't rates go higher?"

Banker:  "Maybe, but you can always refinance before that happens."

Buyer:  "Will there be more closing costs?  What happens if I can't refinance?"

Just kidding, no one asked those last two questions... 

 

The article is sound.  The rich could never get away with what they do if the government didn't enable it.  It's economic meddling and this is the result.  Note tax revenues do not increase as the "rich" are taxed more heavily.  A complex tax code benefits those who know its loopholes...there was just an article about Dutch and Irish baked goods on ZH that gave such an example.  Besides, with a government spending its revenues on social programs, the tax is just a wealth transfer mechanism...no wonder so many unemployed are on the streets looking for a transfer instead of in their garage creating something of value.

Thu, 05/03/2012 - 12:56 | 2394237 El Viejo
El Viejo's picture

In Georgia they were the First to spot "preditory lending practices" Any Preditor - Prey situation is just Darwinian survival of the fittest. Where is all this compassionate conservatizm I hear about??

But to answer your question, I have no problem with poor being bailed out if they were deceived I think most know about the deception by now. It seems compassion only applies to the criminal deceivers. None as far as I know are in jail 5-6 long years later.

Thu, 05/03/2012 - 13:58 | 2394568 Harlequin001
Harlequin001's picture

Were you deceived when you bought that new car using the collateral in your rising house value? Or did you willingly ignore the cause of that, or not bother to find out why it happened because it suited you?

I don't mean it personally, but deception is a lame excuse.

Thu, 05/03/2012 - 19:49 | 2395497 Chump
Chump's picture

Fuck the poor that were deceived.  I don't give a shit.  My household is truly poor (as in, we qualify for all sorts of "benifits" from Uncle Sam, State, and County programs and we have signed up for not one thin dime's worth).  In 2007 I "qualified" for a 250K mortgage loan when we were looking for a house.  I was deceived just like every other poor asshole, the difference being I wasn't blinded by greed.  I knew absolutely nothing about optionARMs, subprime, NINJA loans.  I just knew that they sounded hinky and had to be too good to be true.  So no thanks mister douchey loan officer, I'll take a fixed rate on a loan that sounds reasonable per my income.  Hell, I still get letter after letter begging me to take a home equity loan since I have to be one of the few decent borrowers out there with some equity in their house.  Not gonna happen, because again I'm not blinded by greed.

And before this turns into a rant against greed, I'll say that I also don't give a shit how greedy anyone is.  What I give a shit about is the fact that greedy assholes who spend more on a weekend party than I make in a year can't just fucking lose some money.  They have to cry to their pets in Congress and get ME to bail them out.  And same with the poor woe-is-me assholes who can't manage to cancel their cable subscription or drop their data plan and SAVE SOME FUCKING MONEY.  "I was deceived...boo hoo...blubber blubber."  Yep, learn a lesson, apply it your life, and go vote accordingly.  Or vote with a bullet.  That's what we're coming to anyway.  All because people want a cake, for free, and they want to eat it, too.

I started out on ZH in an argument against anarchy, but I've come to realize that that's the only solution.  If people have the power to fuck with you in any capacity for personal gain, they will.  And they'll do it over and over because they can and because their greed compels them to.  The only solution is to remove that power, period.  Be as greedy as you want but your only method of satisfying it is through your own work and your own abilities, disposing of your life as you see fit.  Try to do it be crossing over anyone else's line of personal sovereignty and you can go fuck yourself sideways with a lunchbox, thank you very little.

Thu, 05/03/2012 - 19:57 | 2395508 Harlequin001
Harlequin001's picture

well said, mostly. And well done...

Thu, 05/03/2012 - 20:04 | 2395522 Chump
Chump's picture

Gotta rant every now and then...

Thu, 05/03/2012 - 21:01 | 2395594 StychoKiller
StychoKiller's picture

Perhaps you've come across this site:  http://pixel420.com/pixel420/stateless/

If not, enjoy!

Fri, 05/04/2012 - 08:48 | 2396308 Chump
Chump's picture

It's not the same but very similar to the one that AnonymousAnarchist pointed me to when I was arguing with him.  Eye opening to say the least.  Thanks for pointing me to it.

Thu, 05/03/2012 - 11:49 | 2393995 LawsofPhysics
LawsofPhysics's picture

precisely.  Capital mis-allocation and mal-investment.

Thu, 05/03/2012 - 12:12 | 2394092 JustObserving
JustObserving's picture

But.. but... there is no money to bail out the poor.  Besides, that would be socialism.

Thu, 05/03/2012 - 11:41 | 2393943 carbonmutant
carbonmutant's picture

TAX the BANKS!

Anything TBTF should carry a larger load.

Thu, 05/03/2012 - 11:43 | 2393961 Temporalist
Temporalist's picture

Taxes religious institutions too...they've gotten off scott-free for too long.  Don't they use the roads and garbage pick-up and police/fire departments too?

Thu, 05/03/2012 - 11:48 | 2393968 carbonmutant
carbonmutant's picture

Good point

Although I'd be willing to cut them some slack on the rates since they're non profit.

Thu, 05/03/2012 - 11:49 | 2393996 Temporalist
Temporalist's picture

Well it can only go up from Zero.

Thu, 05/03/2012 - 12:33 | 2394170 Cruel Aid
Cruel Aid's picture

They are probably tax free because they are a system of assistance for the needy.

And they are working of that by way of cutting charitable deductions. The indirect way.

Taxing them will come later, which will add up to nothing, percentage wise.

Thu, 05/03/2012 - 12:57 | 2394254 Temporalist
Temporalist's picture

Assistance to the needy?  Like altar boys who need to be spanked properly?  And the needy priests whose carnal desires must be met?

Or is it assisting people to brainwash them into believing that if they speak to the "right" invisible superbeing that they will dine forever at the superbeing's dinnertable (incidentally that dining room must be able to sit billions of people by now).

 

I agree though it will amount to nothing but it is the message that will have an impact and that is, the government wants it ALL!

Thu, 05/03/2012 - 14:07 | 2394618 Cruel Aid
Cruel Aid's picture

I'm not a regular churchgoer, but surely you see what it is about, currently and historically. Guidance and assistance. Just a different form of government, with choice being the difference.

Kind of like the states used to be!

And you are refering to the Catholic issue of all male priests. Subject change. Of course that is going to attract pedo's. Good cover, for a while.

Thu, 05/03/2012 - 13:22 | 2394368 Marco
Marco's picture

The banking system was a mode of theft, a mode of theft which has almost run it's course ... pretty soon there won't be a penny left to tax in the banks, all the stolen loot long ago diverted.

Thu, 05/03/2012 - 11:42 | 2393945 ArkansasAngie
ArkansasAngie's picture

By not allowing price discovery and assets to change hands based on economic value ... business has ground to a dribble.

All the happy talk keeps people who cannot afford to improve their assets simply try to hold on till the promised good times arrive.

I want to buy a piece of property at current rents I'll pay $450.  The owner remembers when it would have brought $650.  It is sitting abondoned and he isn't selling cause Uncle Obama says things are picking up.

Don't hold your breath on that one.

Thu, 05/03/2012 - 11:41 | 2393946 odatruf
odatruf's picture

The top rack rate is meaningless unless there is an AMT or other floor rate in effect.  Back when we had 91% rates, people could deduct from their income all kinds of things that are not allowed anymore. For example, prior to 1986, we could deduct not only the interest paid on a mortgage, but also interest paid to credit cards, personal loans, auto loans, etc. This list goes on and on, so that the effective rate people pay - meaning actual taxes paid diveded into the gross income - hasn't changed all that much.  The same for businesses: membership dues for golf and other clubs were fully deductable before, as were meals and a whole host of other expenses.  So again, saying we have an X% rate is meaningless unless you consider what goes into the calculation of income.

But more importantly, I am not opposed to paying more taxes per se.  I think they will be needed at some point.  I am opposed to sending good money after bad to DC to be wasted.  Fix the problems, address Medicare and SS and other year after year spending, and then - and only then - will it be a good idea to send more cash to start whacking away at the debt. Until you do that, I'd rather I and everyone else hold on to our cash.

Thu, 05/03/2012 - 11:52 | 2394003 NotApplicable
NotApplicable's picture

Taxation is theft. Don't you suppose there might be a better form of social organization that doesn't have to rely upon taking property by force?

Fuck you, and your insane gunmen. It is people like you that empower the evil people that control the guns. Until you mature enough to understand this, you are every bit as evil as they are.

Thu, 05/03/2012 - 12:15 | 2394107 AnAnonymous
AnAnonymous's picture

It is an urgent matter now we have stolen the others using the trick.

If we want to keep our loot, we must ban the cause of our success.

Signed: anonymous US citizen.

Thu, 05/03/2012 - 13:13 | 2394324 odatruf
odatruf's picture

Taxation isn't theft. Do I suppose there might be a better system?  Sure.  Do I know of it?  No.  Unless you can solve the free rider problem or the tragedy of the commons, then I don't think you know of one either.  That said, I am all ears.

What you think of me and my maturity level is immaterial.

 

 

Thu, 05/03/2012 - 12:53 | 2394246 Beam Me Up Scotty
Beam Me Up Scotty's picture

And thats why a flat rate tax on everyone should be enacted.  No deductions on anything.  Everyone has some skin in the game.  Tax deductions are nothing more than a means for politicians to buy votes.

Thu, 05/03/2012 - 13:09 | 2394314 odatruf
odatruf's picture

Whether it is a flat rate or a progressive rate or is based or income or consumption isn't as important to me as to what happens to the cash that is sent to DC - no matter how it is raised.

Stop wasting it, stop ducking tough issues and stop the all day - all night party first. Then I'll worry about the rest.

Thu, 05/03/2012 - 13:39 | 2394455 Beam Me Up Scotty
Beam Me Up Scotty's picture

The complexity of the current code allows them to waste it.  I'll be happy to raise your taxes to give me a bigger deduction on mine.  If you want to drain the cesspool and see where all the waste is occuring, the first thing you need to do is pull the plug on the drain--and thats major simplification of the tax code.  Until then, you won't get anywhere.

Thu, 05/03/2012 - 11:41 | 2393952 nimbus3000
nimbus3000's picture

Would be good to see these graphs with absolute numbers than in percetages !

Thu, 05/03/2012 - 11:41 | 2393954 wherewasi
wherewasi's picture

Should ANYONE pay more taxes?  What would the reason for this be?  Let me know what problem might be resolved by doing this and maybe I would suppoprt it.  (Probably not though)

Thu, 05/03/2012 - 11:46 | 2393974 odatruf
odatruf's picture

Not a single problem would be solved. In fact, we'd be worse off since the status quo leaders would do more of the status quo. Specifically, they would obligate the new money (and then some) to new projects and spending ideas.  We'd not only get more bad government, we'd get stuck with yet higher bills and we'd then have fewer reserves with which to undo it all.

 

Thu, 05/03/2012 - 11:48 | 2393984 NidStyles
NidStyles's picture

What is this "we" shit? I didn't sign any contracts saying I was obligated to pay the Federal Government's debt.

Thu, 05/03/2012 - 12:28 | 2394152 JamesBond
JamesBond's picture

tariffs were meant to do that....

Thu, 05/03/2012 - 11:41 | 2393955 Dr. Engali
Dr. Engali's picture

I'm not angry about the tax ratio. The fact that income from labor can be taxed is beyond ridiculous to me. I'm angry about the guaranteed put they have. If you are wealthy more power to you, but if you blow up your business,or firm don't come crying to me.

Thu, 05/03/2012 - 11:42 | 2393956 Zero Debt
Zero Debt's picture

Most of the inequality emanates from the flawed inflating currency.

Remove the inflation tax from the poor and the middle class and the inequalities will drop drastically.

Thu, 05/03/2012 - 11:43 | 2393957 apberusdisvet
apberusdisvet's picture

There have always been 2 types of "rich".  The productive innovators (Edison, Ford, Jobs), and those that game the system by corruption to gain tax or regulatory advantage.  It was always  (up to post WWII America), the American Dream and Rule of Law to emulate the former and imprision the latter.

How far we've fallen

Thu, 05/03/2012 - 11:43 | 2393958 Walt D.
Walt D.'s picture

"Federal revenues have hovered close to 20% of GDP whatever the tax rate on the richest few."

This is the key point. Tax the rich is essentially the equivalent of a hate crime. It serves no useful purpose. It is just another example of tired old Marxist dogma.

Thu, 05/03/2012 - 11:52 | 2394001 LawsofPhysics
LawsofPhysics's picture

Right, because bailing out the rich when they make bad bets isn't a crime.  Go fuck yourself.

Thu, 05/03/2012 - 11:58 | 2394035 mayhem_korner
mayhem_korner's picture

 

If bailing out the rich is a crime, is bailing out the self-inflicted poor simply 'welfare'?  In other words, isn't it the bailout that's the problem, and not simply whether the beneficiaries are rich?  Inquiring minds want to know.

The logic here at times is that being wealthy is a crime in and of itself.  I just don't accept that generalization.

Thu, 05/03/2012 - 12:03 | 2394061 LawsofPhysics
LawsofPhysics's picture

Pay attention moron.  I don't favor bailouts of any kind, nor does my post even mention the poor nor do I say being wealthy is a crime.  The point being that everyone (wealthy or not) should be held accountable for their actions and the mal-investment of their time and resources.

Now get back to work.

Thu, 05/03/2012 - 12:08 | 2394079 mayhem_korner
mayhem_korner's picture

 

 

Say what you mean then, and leave out the insinuation.  To someone who has made a good, honest living but gets demonized for being 'wealthy,' the tirades of the libs who flock to these posts gets tiring.

Thu, 05/03/2012 - 12:08 | 2394083 Chump
Chump's picture

The comment you initially responded to didn't even mention bailouts.

You're off on a tangent and being an asshole about it.

Thu, 05/03/2012 - 12:24 | 2394136 Walt D.
Walt D.'s picture

I never said anything about bailouts or corporate welfare, which I opposed. Bill Gates and Steve Jobs did not receive bailouts.

The people earning $200,000 who will be caught up in the tax the rich scam did not receive bailouts.

Thu, 05/03/2012 - 11:44 | 2393962 AnAnonymous
AnAnonymous's picture

Responsible? Maybe. Sure that now the inputs come from their own property, rich US citizens will look at it twice or even only once before extolling US citizen growth myth.

Ah, the good old days when the Indians falled in love with US citizenism and volunteered to squander their property on accomplishing the promised land.
Land of the free, home of the brave, emancipation of humanity...

Way too many US citizens, not enough Indians.

Thu, 05/03/2012 - 13:30 | 2394402 TheFourthStooge-ing
TheFourthStooge-ing's picture

AnAnonymous said:

Ah, the good old days when the Indians falled in love with US citizenism and volunteered to squander their property on accomplishing the promised land.

Ah, the good old days of Chinese citizenism when Tibetans falled love into Chairman Mow's Little Red Joke Book and volunteered indentured servitude slavery while Chinese citizenism citizens squatted on their property, spreading their cheeks and dropping piles of Chinese citizenism excretion exports, accomplishing the blemished land of Chinese citizenism new world odor.

 

Thu, 05/03/2012 - 13:35 | 2394427 AnAnonymous
AnAnonymous's picture

Those days arent that old.

Volunteered slavery? That is good for the US of A, their song of freedom and how some men should be kept slaves because they are not human beings.

China well, ended slavery in Tibet. Such a mistake should question their capability to adopt US citizenism, indeed.

Thu, 05/03/2012 - 14:01 | 2394588 TheFourthStooge-ing
TheFourthStooge-ing's picture

AnAnonymous said:

China well, ended slavery in Tibet.

Made me laugh. Chinese citizenism renamed slavery in Tibet as Patriotic Volunteerism, so now can say no more slavery in Tibet.

Chinese citizenism never mentions that Patriotic Volunteerism in Tibet occurs at Peoples Liberation Army Chinese citizenism end of gun barrel.

Ah, but Chinese citizenism should be thanked by Tibetan Patriotic Volunteers for making easy decision to volunteer.

Not a difficult decision when alternative to volunteerism is...

 

Thu, 05/03/2012 - 11:44 | 2393964 VoiceOfReality
VoiceOfReality's picture

Plot PRODUCTIVITY increases against WAGES, and since 1980 you will find that the productivity gains a.k.a GROWTH have all gone to the wealthy while none have gone to the poor. Increasing tax does not increase revenue therefore we should not worry about increasing taxes, well by the same logic we can say increasing growth does not increase wages for the poor, so then why should the poor worry a hoot about GROWTH? Your parents could support a family with one wage coming in, now 30-40 years later, to support a family you need two. That's the con trick they pulled on you. 

Thu, 05/03/2012 - 11:57 | 2394021 mayhem_korner
mayhem_korner's picture

Plot PRODUCTIVITY increases against WAGES, and since 1980 you will find that the productivity gains a.k.a GROWTH have all gone to the wealthy while none have gone to the poor.

If you are an Alinsky class-warfare victim, you read this as 'all the productivity gains have been stolen by the wealthy;' you can also read this as 'those that have envisioned and engineered productivity gains have reaped the rewards of their innovation.'

 

Thu, 05/03/2012 - 19:29 | 2395467 Chump
Chump's picture

My parents didn't have 200-something HD channels on a 50" plasma, two new cars in the garage, a family all loaded up with iPhones and unlimited data, all living in a 3000 square foot house.  We didn't go out to eat 3 nights a week with fast food stops thrown in a few afternoons.  And we were normal.

My household relies on my meager salary alone while my wife raises our children.  We are not rich by any means, at least not monetarily.  We also don't have any of the random, materialistic shit that our friends do.  Nor do we have their debt problems and money stresses.

Focus your ire against the criminals, not the people that have more wealth than you.  It's not a subtle distinction and it will get you into a problem solving mindset instead of a butthurt one.

Thu, 05/03/2012 - 11:44 | 2393967 Jim in MN
Jim in MN's picture

 

 

 

To answer the headline, Yes. 

 

Normal tax rates are part of the solution.  As in Eisenhower era tax rates.

But, so is admitting that we have the role of government totally fucked up and we need to scale back in crazy big way.  As in Eisenhower era scope/role of government.

 

Do both or lose the game. 

 

TANSTAAFL, people.

There Ain't No Such Thing As A Free Lunch.

 

 

Thu, 05/03/2012 - 12:31 | 2394166 docj
docj's picture

Funny thing - if we had Eisenhower-sized government we probably wouldn't need anything close to Eisenhower-level income tax rates, unless you put-back all the deductions that used to be in the tax code through 1986 (something I wouldn't recommend). Probably a straight 10-15 percent rate on most everyone above 2x poverty would do the trick.

Thu, 05/03/2012 - 16:08 | 2395035 Umh
Umh's picture

The politicians will just redefine the poverty level again for their own purposes.

Thu, 05/03/2012 - 11:51 | 2393998 Matt
Matt's picture

If Warren Buffet and Stephen King want to pay more, isn't there an account they can donate money to the federal government?

I mean, since some people want to pay more, everyone must? that's terrible logic.

Thu, 05/03/2012 - 11:53 | 2394006 mayhem_korner
mayhem_korner's picture

 

 

Set tax rates on bank income to (100% - their reserve ratio) and all will be well.

Seriously, the core problem is leveraged government spending.  The tax rate discussion simply deflects attention away from that and get the masses to draw lines between themselves.  It's classic Alinsky-esque.

Thu, 05/03/2012 - 11:53 | 2394007 trillion_dollar...
trillion_dollar_deficit's picture

Yes

Not the actual business owner or creator. But, those the owner/creator employs that earn significantly more than the average worker. Say make the cut off $150k (dependant upon where you live). And uncap the regressive Medicare/SS tax.  

Thu, 05/03/2012 - 11:53 | 2394010 haskelslocal
haskelslocal's picture

Comparing Tax Reveunes to GDP is not only totally misleading, it's bogus hocus pocus.

Focusing on the "top" tax bracket lacks balance and pulls your analysis out of control. 

There's no need to suggest that anyone believes that increased taxes could cover all the deficit spending. No kidding, it has to come down.

The only thing that makes partial sense is when you said "capital gains above a certain threshold should probably be taxed at the same rate as income, because it is effectively the same thing."

What's this about threasholds and probability? Just pick a fair rate and make it the same.

Thu, 05/03/2012 - 11:54 | 2394011 Sweedumz
Sweedumz's picture

So the top 1%, being taxed at ~35%, contribute ~40% of the tax take.

This meas that doubling their tax rate to 70% would increase the total tax take by 40%

And taxing them at 95% would increase the tax take by ~108%.

So taxing the rich at their historic levels would more than double income tax revenues overnight.

 

Problem solved.

Thu, 05/03/2012 - 11:58 | 2394028 dmger14
dmger14's picture

I hope that is sarcasm.  Expecting people to work for 20% or less is naive at its best, and your example has the rich paying the bills going forward, presumably indifferent to working for a small fraction of pay.  In reality, Atlas Shrugs long before that.

Thu, 05/03/2012 - 13:03 | 2394293 Temporalist
Temporalist's picture

Atlas would have loved being taxed at 80% for the honor and priviledge of living and working in the USA.  Doesn't everyone feel that way?  It's an honor to provide Nancy Pelosi, Harry Reid, Mitt Romney, Michael Bloomberg, Newt Gingrich, George/George/Jeb Bush et al with benefits, pensions and lifetime healthcare for their entire families.  I think people don't work hard enough for them.

 

Thu, 05/03/2012 - 13:52 | 2394528 RoadKill
RoadKill's picture

Personally Im looking into making myself a corporation and doing a Double Irish Dutch Sandwich. Thats what these tax the rich diuchebags dont get. Paying taxes is to a certian degree vollentary for the rich because they are smarter then the people that work at the IRS and can hire an army of lawyers. If you raise taxes to a level we fell is unfair and higher then our lawyrrs cost, we'll stick our money into a bunch of limited partnerships, trusts and other complicated schemes to avoid paying. And if you really come after us we will rennounce oir citizenship and move to Saint Kivitz or someother place. Go Google Four Flag theory.

Thu, 05/03/2012 - 15:47 | 2394959 sof_hannibal
sof_hannibal's picture

Let them eat cake, i mean Rand, I mean chicken. No i mean pussy, let them amn rand muff

Thu, 05/03/2012 - 11:55 | 2394014 dmger14
dmger14's picture

The rich have the profit incentive to create jobs, not some moral duty.  With high taxes, regulations and labor costs here, they have every right to be cautious about hiring workers.  I have money in a 401k and would be ticked off if the companies I have ownership in got hammered becaues they hired workers not needed just to give them employment to help the economy, and profits declined.  Companies rightfully base investment on prospects of profitability, or else they'd go under.  7 of 8 companeis go under trying to be profitable anyway.  How many more need to go bankrupt hiring unneeded workers, and wouldn't those workers be out of a job again when the company no longer exists?

Thu, 05/03/2012 - 12:19 | 2394117 AnAnonymous
AnAnonymous's picture

Ah, but with depletion of resources looming ahead, and resources coming from their own property, they have the obligation toward their dynasty to be extra cautious about giving access to their owned resources to create jobs.

You know, when you distribute the property of others to create jobs as the Great US of A has been doing since its inception, well, it is much easier.

When you have to distribute your own property, well, well, well, another story.

Thu, 05/03/2012 - 11:57 | 2394027 Joe Davola
Joe Davola's picture

OK, so the rich are supposed to run the gamut of rules and regulations to create and/or expand a business that creates real goods/services.

 

OR, you can play the investment casino where there are very few rules or regulations, and those that exist are lackadaisically enforced.

 

Which would you choose?

Thu, 05/03/2012 - 12:04 | 2394065 VoiceOfReality
VoiceOfReality's picture

The rich use the rules against regulations to their advantage, to consolidate their position and beat down competition. The job-creating heroic small/medium businessman you imagine in your head is NOT rich, they are on the outside of this arrangement.

Thu, 05/03/2012 - 11:59 | 2394037 segar
segar's picture

The income tax needs to be eliminated and replaced with a consumption tax.   49.5% don't pay any federal income tax, many of them get benefits at the expense of those who are working and paying taxes.  Many of these deadbeats have cell phones, drive nice cars, plenty of cash for cigs and booze, etc.  Why raise taxes on  the rich when almost 50% pay absolutely nothing?  Drug dealers, hookers and other people with unreported income would contribute their fair share with a consumption based tax system. 

Thu, 05/03/2012 - 13:12 | 2394322 Temporalist
Temporalist's picture

OT but your comment made me think how the consumption tax system would be gamed.  I think, for example, a luxury company would cater to the wealthy by allowing them to buy something, return it, then buy it back as "used" so they will get it at a lower price thus avoiding the tax on the inital amount (the original price would be inflated to allow for profit margin for the seller).  I know that is a weak example but the idea is that there is always a loophole and people will always game the system.  The more rules there are the harder they are to enforce.

Essentially barter I guess would eliminate all taxes then on consumption and I could barter you a Ferrari for a hug and sell you a kiss for $200,000...

Thu, 05/03/2012 - 13:22 | 2394369 FedBunny
FedBunny's picture

So that means about 1000 oz. of gold for a blow job.

Thu, 05/03/2012 - 13:31 | 2394416 Temporalist
Temporalist's picture

If you're willing to part with it I'm sure Craigslist will help you find an agreeable party.

Thu, 05/03/2012 - 12:01 | 2394045 Bartanist
Bartanist's picture

I suppose the other way to look at the first chart is that GDP decline is inversely proportionate to the amount of tax collected from the wealthy. How is that for a surprise conclusion. 

Thu, 05/03/2012 - 12:00 | 2394051 Blammo
Blammo's picture

Yet the Occupy movement are still angry.

  If they're not angry they have to find something else to do.They lack the imagination for that.

Thu, 05/03/2012 - 12:02 | 2394056 Kreditanstalt
Kreditanstalt's picture

Stupid article.  No one has the "responsibility" to employ others.  If central bankers and governments have created conditions in which it makes no sense to deploy capital, why should "the rich" do it?

Thu, 05/03/2012 - 12:13 | 2394097 mayhem_korner
mayhem_korner's picture

 

+1  Bull's eye comment.  You'll bleed red for it, but that's because it's true, and truth is like kryptonite to libs.

Thu, 05/03/2012 - 12:09 | 2394078 HD
HD's picture

Rich or poor - when people pay taxes they want to see some real benefit - roads, electrical grids, clean water, education, health care, R&D...

 Most of our tax dollars are pissed away at the behest of special interest groups, corporate welfare, expanding government (TSA and Utah domestic spying...I mean data center) and protecting monopolies and the status quo.

Thu, 05/03/2012 - 12:09 | 2394082 xtop23
xtop23's picture

I guess they don't understand that the rich have a ticket out of here.

Give up your citizenship and live on a beach somewhere in comfort for the rest of your days.

At least until Arnie shows up holding a plasma rifle with a 40-watt range I suppose.

Thu, 05/03/2012 - 12:15 | 2394103 james larson
james larson's picture

I get the point the author is making but a couple of questions.  Havent we already seen the outcome of increased Federal/Government spending without the added revenue?  The only difference is the source of that revenue really plus interest.  How does increased revenue and subsequent spending suddenly work better when the rich pay the freight rather than debt?

Government picking lousey investments doesnt change any really with added revenues/spending...or do we fall back to the position that any spending is better than none.  Seems to me a better plan to invest some giant glob of money is to incentivize "the rich" to invest rather than assume government will somehow do a better job.  Id like to see..in a simple chart form how my added 100,000 in tax payments finds its way thru the federal clutches and becomes a better investment than I might choose without tax coersion.

Do NOT follow this link or you will be banned from the site!