Kevin Drum of Mother Jones writes in a post entitled "Tribalism and Taxes:"
In the modern Republican Party, tax policy isn't really about tax policy anymore. It's mostly just meant to be evocative, a demonstration that you're really, truly part of the family. So the crazier it is, the better. Nobody—least of all Republican voters—seriously expects any of these proposals to become law.
What's really mind-blowing, though, is the precise nature of the tax policies that rich Republicans have so thoroughly succeeded in adding to the canon. Middle-class conservatives have become completely convinced that "good" tax policies include a flat tax, lower capital gains rates, and repeal of the estate tax, all of which are designed to benefit the rich almost exclusively. It would be as if Democrats had somehow convinced Wall Street that the key to prosperity was higher taxes on yachts, private jets, and Hamptons getaways.
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72 comments:
yeah, as if the democratic party could ever convince wall street of that
Well said, huh?
There is no point in arguing with this on the merits. I just want to note once again: paleos like Steve are no conservatives, they are socialists who dislike immigration.
"It would be as if Democrats had somehow convinced Wall Street that the key to prosperity was higher taxes on yachts, private jets, and Hamptons getaways"
The Democrats DID convince Wall Street to embrace higher taxes for the rich.
Race has twisted the minds of both parties.
Not well said. If there's a tax everybody should pay it, and if the majority think a 9% tax on their incomes is still too much, then they should vote to get rid of it.
Income and estate taxes are unjust and uneconomic. The income tax is not a tax on being rich; it's a tax on becoming rich. Same with the estate tax. It's just Old Money's way of keeping New Money from becoming New Old Money.
I do agree the differential capital gains rates are a travesty. So are all the credits, deductions, exemptions, etc. Get rid of them all! They corrupt the entire political process and distort markets.
Sales tax and property tax are the only effective taxes on wealth and the only way to assure the tax base extends to the limits of the eletorate.
Why does anti-gnostic like Paris Hilton so much?
I have a few principles when thinking about tax policy:
1. Don't merely consider federal income tax, but also the host of other, more hidden taxes, such as payroll, cap gains, property, sales, estate, other fees and regulations, etc.
2. If you tax something, you get less of it. If you subsidize, you get more. So, since we are taxing payroll and income, we are artificially increasing unemployment.
3. We need to tax something in order to support the services that voters want government to provide.
4. Taxes that are transparent, easily enforced, easily complied with and equally burden all groups would seem most fair.
With these in mind, I prefer a consumption tax, such as a national sales tax or VAT, while at the same time eliminating the income tax, payroll tax and capital gains tax. Think about it--people don't resent those who earn money (after all this is usually pretty private). We resent those who spend, and spend lavishly and wastefully. A 20% tax on goods and services would go some way towards reducing this wasteful spending. But if take-home pay increases by 20%, it will not unduly burden people. And people who change their habits, by buying less would save more. Now, you'd have to have certain exemptions or even income subsidies.
There are three other hidden but enormous advantages to this simplification. 1. Americans would save 6.1 billion hours that they currently devote to preparing their taxes every year: http://money.cnn.com/2011/01/05/pf/taxes/IRS_tax_study/index.htm 2. Politicians would lose much of their power since they wouldn't be able to set policy via the income tax code, with obscure credits and loopholes. All they would have to do is vote to raise or lower the national sales tax. 3. Every purchase would remind Americans of the heavy burden taxation has on their lives. It wouldn't be hidden in paystubs or just happen once a year. Perhaps this would cause them to think twice about voting for expensive social programs or military adventures.
All those points are arguable, but basically it boils down to different ideas of what constitutes "fairness". There really are people out there who don't think it's the government's job to take money from some people and give it to other people.
The Democrats DID convince Wall Street to embrace higher taxes for the rich.
No.
Being "rich" means being "wealthy" which means having lots of "wealth" which is NET ASSETS.
NET ASSETS are not the same thing as INCOME.
The Democrats have NOT called for higher taxes on NET ASSETS. They have called for higher taxes on INCOME.
What makes you think Steve is advocating taxing the rich? He's just showing that diversity breaks down civil society. You can't have your socialism and open borders. You have to pick one or the other.
It is the left's and not the right's fault that so many poor whites feel that it's better for the rich (whites) to keep their money rather than it go to the government (which openly discriminates against whites, including the poor ones).
The upper middle class i.e. 100k-500kish people really end up paying the most for everything. These people actually work. A tax increase on the rich just means a tax increase on them, and more tax evasion for the truly rich.
An estate tax means it's harder for middle-upper middle income people to secure a comfortable future for their children (and maybe help them break into the truly rich class), while the super rich will continue to evade and get by on other means like connections.
Capital gains may be ok, but all you're doing is just distorting the market even more.
What is wrong with a flat tax (doesn't have to be truly flat, certain goods like food won't be taxed, luxury moods may be taxed higher etc..)? Is it wrong because the rich can't evade it?
I just want to note once again: paleos like Steve are no conservatives, they are socialists who dislike immigration.
You don't know what the words "conservative" and "socialist" mean.
There really are people out there who don't think it's the government's job to take money from some people and give it to other people.
At present the government takes money from the poor and middle class and gives it to the rich. How about it stops doing that?
Since Republicans aren't allowed o express strong opinions about the Mexicanization of America, the increasingly appalling behavior of the black underclass, and the fact that racial differences in IQ doom us as a top-flight economy, they must channel their passion into expressing strong opinions about taxes.
It's true that there has been a disturbing growth in income inequality in the past 25 years. But how does increasing taxes on the rich help the middle class if the money just flows into government coffers? By creating more make-work jobs for diversity hires?
Mickey Kaus made a point recently that I agreed with: Americans will not trust government proposals for "comprehensive" packages of tax hikes and spending cuts unless the spending cuts are real and come first. We have been burned too many times with actual tax increases and promised, but never delivered, spending cuts. It's just like comprehensive immigration reform--we know we will get the amnesty but not the border control. If the government could pass five budgets in a row that cut spending, the public would be ready to consider tax increases if necessary.
Will the estate tax hit the super wealthy? My concern is not that these taxes go against holy church doctrine, but that they will miss their target and hit the regular man on the street instead.
I do recognize that most of the anti-tax stuff comes from Reagan. Unfortunately people still think that this is the 1980s, and that the only issue is the money supply and over taxation. We've added some social problems since then, and tax policy can not fix those.
At present the government takes money from the poor and middle class and gives it to the rich. How about it stops doing that?
The government doesn't take money from the poor for the obvious reason that they have no money to take. The poor are also disproportionately net tax consumers with high rates of social pathology.
I am Lugash.
It's true that there has been a disturbing growth in income inequality in the past 25 years. But how does increasing taxes on the rich help the middle class if the money just flows into government coffers? By creating more make-work jobs for diversity hires?
By picking up the tab for college and healthcare? Both are unlikely to be implemented, and if they are it will probably devolve into the usual corrupt mess.
I am Lugash.
First they came for Wall Street, and I said nothing...
Is there something that says the middle class must pursue "What's in it for me?" policies like the rich and poor do; that we can't want a policy because we truly think it's best for the country regardless of whether it helps us personally? Mr. Drum seems to be saying no.
Most peoples' expressed opinions on most political subjects are all about tribalism, because most political topics are outside even their most peripheral knowledge. We use expresed beliefs as another marker of tribe membership, like accent and grammar and clothing.
The only problem with this is when it overlaps with trying to talk about reality. That's when the factual questions like "do vaccines cause autism" or "is human CO2 output causing global warming" or "does Iraq have weapons of mass destruction" become important. And way, way too often, those discussions about reality are infected by the tribal markers. That's why I can ask who you voted for in the last election to find out whether you think evolution really happened, or whether US budget deficts are a short-term crisis needing severe spending cuts to address.
Steve's favorite topics involve a great deal of this. Believing that IQ varies by race and measures something important is a team marker for a team most people dont want to be on. Believing that years of large-scale immigration is harmful for social cohesion or for the prospects of the folks born on the left side of the bell curve is, similarly, a marker for a team most of us don't want to play for. And yet, these are also questions of fact whose answers matter a great deal.
"There is no point in arguing with this on the merits. I just want to note once again: paleos like Steve are no conservatives, they are socialists who dislike immigration."
No, they are conservatives who think there's a fair debate in how to equitably split the tab for the costs of government. There is NO argument to be made that lower taxes lead to higher growth. In the 80s and 90s cap gains taxes were always higher than now - at times twice as high - and the inheritance tax was 55%, versus only 35% now. Yet economic growth was much faster then than it's been during the last 11 years.
Social conservatives and paleos are giving it away for free. They support lower taxes for the rich and wars for Israel automatically, before ever getting anything in return. George W. Bush came into office in 2001. He immediately cut taxes on the rich. No complaints from paleos. Then he launched wars against Afghanistan and Iraq. No complaints from paleos. Then what did paleos get the remainder of his term? Screwed. Neither religious conservatives nor paleoconservatives have jack shit in the way of new policies or laws to show for Bush's 8 years - no school choice, no end to affirmative action, no cut in Planned Parenthood subsidies, no increased immigration enforcement (and 2-3 attempts at amnesty). And now the financial crisis, the Great Recession, and a trillion dollar annual deficit.
Sales tax and property tax are the only effective taxes on wealth
In other words, the two taxes that hit the middle class and poor the hardest...
Anonymous 125pm:
So your definition of socialist is what, anyone who disagrees with you on tax policy? I have pehaps missed the blog posts where Steve has proposed nationalizing the means of production or imposing some kind of Harrison Bergeron like equality of results.
More fundamentally, though, magic word arguments intended to shut down thought probably don't work too well here. If telling me I'm a racist for knowing what IQ means and how it's distributed didn't work, perhaps calling me a socialist for thinking current Republican tax proposals are nuts will also fail.
The Obama estate tax proposal had a $7 million exemption and a 45 percent rate over that exemption. How many middle income people are passing on in excess of $7 million to their kids?
The right will never approve a national sales tax. It's too efficient and invisible as a revenue raiser -- European countries have a version of it through the VAT and smart anti-tax types hate it.
Most peoples' expressed opinions on most political subjects are all about tribalism,
That's true. It's identity politics all the way down. If the U.S. was a relatively small ethnically homogeneous nation which still had class distinctions then peoples' favored policies would be utterly different.
An estate tax means it's harder for middle-upper middle income people to secure a comfortable future for their children (and maybe help them break into the truly rich class), while the super rich will continue to evade and get by on other means like connections.
I'm reminded when Rose Kennedy died the family managed to structure her assets in some kind of trust and they didn't pay a damn dime in inheritance taxes. But how many small business owners can afford to do that?
I'll take the Warren Buffets of the world seriously when they propose a wealth tax.
At present the government takes money from the poor and middle class and gives it to the rich.
No it doesn't.
The reality, as best I understand it, goes like this:
a. We run a deficit in just about every year, because raising taxes costs votes and spending money gains votes.
b. In bad years (like the last three), we would run a deficit absent huge cuts to discretionary spending, because there's less of an economy to tax and there are more people getting government money via all sorts of welfare programs.
c. There is simply no way to close the deficit, even in good years, that doesn't hurt somebody who can and will push back, or disrupt the economy in bad ways, or both. We have to cut spending or raise taxes or both, and any way to do that is going to hurt real people and cause dislocation and maybe lose valuable things. That's why we have a deficit in good years.
d. All the argument about redesigning the tax code is probably just hot air. What we will very likely get is tweaking around the edges, because any large changes to the tax code, even ones that would decrease the total tax burden, will cause all kinds of pain and chaos for several years.
e. Right now, way too much tax burden (including SS and Medicare and state/local taxes) falls on people making just about squat. This is one more way we have rearranged our society to screw the people at the bottom.
f. The best tax policy we could have would be as simple as possible--we will never be entirely rid of rich people gaming the tax code, but a simpler system may at least make it harder to convince voters that somehow they get to vore to spend more money without having to have their tax bills go up.
Kevin Drum is expressing his own left-wing tribalism. He identifies with the political class, which needs a complex system of tax exemptions and differential rates in order to maximize revenue and favors to politicians. At present the part of the political class that Drum identifies with most is owned lock stock and barrel by the very rich. Nobody is going to be increasing their taxes. What we're talking about here is increasing income taxes, which are principally paid by the strivers trying to become rich.
"So your definition of socialist is what, anyone who disagrees with you on tax policy?"
Hey, a straw man fallacy so pathetic even a fifth grader wouldn't use it!
Thanks for the example! We'll avoid such AWFUL argumentation in future elementary school debates!
In other words, the two taxes that hit the middle class and poor the hardest...
All costs hit the middle class and poor harder than the rich. The rich eat better and have better medical care too.
Government costs money, and the debate is how to split the tab. You want to do it in a way that avoids distortions, is easy to administer, and everybody has to pony up so I can't vote myself government freebies with your money. Sales and property taxes are really your only choices.
You probably also think that rich people actually used to pay 70% of their income in taxes.
I don't mind having some estate tax. Better to tax the dead, who don't have to eat, than the living, who do have to eat.
I'd like to see more of Henry George's ideas implemented.
Another random thought, anyone remember Pat Buchanan's idea from '06 or '07 to charge imports from VAT-levying nations a fee equal to their VAT rate?
Steve, You're obsessed with The Onion, it's just a joke paper, give us some real news from a nuanced source like Mother Jones.
"Social conservatives and paleos are giving it away for free. They support lower taxes for the rich and wars for Israel automatically, before ever getting anything in return....Neither religious conservatives nor paleoconservatives have jack shit in the way of new policies or laws to show for Bush's 8 years"
Amen. Social Conservatives have been treated like suckers by the wealthy and the neocons.
There is no point in arguing with this on the merits. I just want to note once again: paleos like Steve are no conservatives, they are socialists who dislike immigration.
You are truly a submoron who doesn't understand what the definition of "socialism" is, please go back to commenting on National Review articles or wherever it is that your posts are considered insightful.
You probably also think that rich people actually used to pay 70% of their income in taxes.
The question is, when did rich people pay a greater percentage of their income in taxes, back when the top rate was 70 percent with lots of exemptions, or today when it's 35 percent with lots of exemptions?
Anon #2 is right. Sailer would be campaigning for Eugene Debs if the other candidate might have accidentally had a layover in Tel Aviv once. It's just so refreshing to have it explained to me by KEVIN DRUM, and aspiring Drums like Yggy, that I'm laboring under false consciousness for opposing government predation and favoring an open and proportional tax code. Thanks, Kev, for being the true non-tribal ubermensch we all look to for guidance
Steve actually reminds me a lot of Kevin Drum. A moderate, fairminded Californian of a certain age who looks back nostalgically on California as a middle class utopia and wonders what went wrong.
"paleos like Steve are no conservatives, they are socialists who dislike immigration."
I suppose that in the 1950s, when the US had a top marginal tax rate of 92%, the United States was a commie paradise. Or maybe it was 85% white, and white middle-class taxpayers could know that most of the benefits would go to their own people, rather than aliens seeking special goodies for their own tribes.
Sailer is the foremost contemporary champion of the middle class. When you combine that political stance with his southern California cool and general laid back attitude it's completely ridiculous that practically everybody in the mendacious mainstream who deigns to notice him calls him a "far right" blogger.
What a joke.
The "they don't know their own best interests" school of public philosophy is catnip to the modern collegiate progressives, allowing them to bask in their SAT-supremacist self-conceit while absolving them of any responsibility for the fun social experiments they've cooked up, all mistakes henceforth shifted onto the racist, homophobic, sky-god-worshiping plebes. It's good to feel useful.
no King ever dreamed of levying taxes anywhere near the amount we pay.
Another random thought, anyone remember Pat Buchanan's idea from '06 or '07 to charge imports from VAT-levying nations a fee equal to their VAT rate?
in his latest book too.
VAT taxes are border adjusted, which means they are actually a tariff. All the countries the USA trades with have border adjusted VAT, so they all have tariffs but the USA doesn’t have a border adjusted VAT making imports cheaper and exports more expensive.
Tariffs or a border adjusted VAT would seem a bipartisan no brainer. Dems get tax revenue and Repubs get more private sector jobs inside the USA. But the rich don’t want tariffs so we don’t get them.
@eric At present the government takes money from the poor and middle class and gives it to the rich.
No it doesn't.
It gives it to a select political class. Certainly the federal reserve is a subsidy we all pay - and a few well connected banks benefit.
Bailouts are another example. agribusiness subsidies yet another, and as Steve S posted a few weeks ago, Microsoft paid 7% tax.
OT but .. some animals are more equal than others:
http://www.dailymail.co.uk/news/article-2051399/Bloomberg-outraged-ultra-orthodox-Jewish-bus-women-told-sit-back.html
A bus carrying mostly Hasidic Jews - where men sit at the front and women sit at the back - has provoked fury from the New York City Mayor.
Michael Bloomberg said gender segregation on public buses is ‘obviously not permitted' and called the bus in Brooklyn, New York, an 'outrage'.
From the outside the B110 might look like any other bus - but on the inside revelations about its seating arrangements are causing huge controversy.
of course the fact the bus shuts down for the jewish sabbath is ok...
First they came for Wall Street, and I said nothing...
As far as the typical Republican voter is concerned, this should be rephrased to "First Wall Street came for me, and I said nothing..."
Wall Street and the government are the same frickin' thing. It's depressing that there are still people in 2011 who remain oblivious to this, and imagine that it is their duty to "protect" poor widdle Wall Street from the big bad goverment bullies.
Most of the increase in income inequality in the past 30 years has little to do with taxes and spending. It's the distribution of pre-tax income that has skewed, thanks to explicit government policies that do not directly redistribute income but structure markets to ensure that wealth flows to the top:
http://www.cepr.net/index.php/publications/books/the-end-of-loser-liberalism
The question is, when did rich people pay a greater percentage of their income in taxes, back when the top rate was 70 percent with lots of exemptions, or today when it's 35 percent with lots of exemptions?
TFRA wiped out tons of exemptions so for rich people drawing salaries I'd say they're paying the same. The real inequity is the capital gains rates, but then get ready for the howls of despair when Ma and Pa Kettle sell the family farm and get taxed at regular rates.
Bottom line, income taxes are probably the least efficient, least equitable taxes.
And half the country doesn't pay them.
What were you doing reading Mother Jones?
I went to this which seems to be the post Sailer intended to link. Drum, once you get past his usual concern-trolling, has made a valid point despite himself. Not many of the big wheels in the Cainmania movement are 999 purists who seriously want it implemented; it's a coalition gimmick (akin to "bend the curve" and, arguably, the Iraq invasion). Most of them assume it'll never happen anyway, as they rationally assume 535 Congressmen will never permit a straight tax code (which would be self-obviating).
"Tax tribalism" is the same phenomenon as assault weapon ownership or partial-birth abortion--nobody supports it out of practical necessity. They're just "litmus tests" i.e. gang loyalty oaths for politicians. Fortunately now we have nerd-blogger ideologues like Drum to link to each other's posts in explication of this social feature dating at least to the Jacobins.
Kevin would have a point except that really rich people don't worry about income taxes because they don't have income. They own things and control things (both through their ownership and their places in society).
High income taxes hurt the next group down - the small business owners, professionals and wall street types who might want to own things, but don't have enough yet where they can go without significant income.
Our national debate is idiotic because its composed of really really passionate debate over what at most is a 600 - 800 basis point swing on the highest income bracket. While the tax code is a piece of garbage the country's problems can't be cured by goofing around with the income brackets or incentives.
All the yelling about taxes is because neither party can deal with the real problem, which is the approaching massive welfare (social security and medicare) benefits the baby boomers are going to start collecting in a few years. Of course the politicians can't deal with this problem because the people of the country can't deal either: they reflect the pathetic character of our people.
anon:
Fair enough. Why dont you explain how you define socialism, that captures Steve's post now or his general take on economic issues? Can you distinguish a socialist from a nonsocialist by, say, whether he favors a flat tax vs a tax with three different rates, by your definition?
MQ,
The question is, when did rich people pay a greater percentage of their income in taxes, back when the top rate was 70 percent with lots of exemptions, or today when it's 35 percent with lots of exemptions?
The proportion of federal revenue that is income tax was 65% in 1970; 60% in 1980; 54% in 1990; 60% in 2000; 50% in 2010.
On the other hand, federal revenue as a proportion of GDP has remained fairly stable. It was 18.6% in 1970 and 18.2% in 2007. It inched up to 20% a couple of times under Democrats but for the most part has been between 17-19% since about 1950. Curiously, it's lower then it has been for sixty years under Obama, at 15% for 2009 and 2010.
http://www.usgovernmentrevenue.com/
Silver
The proportion of federal revenue that is income tax was 65% in 1970; 60% in 1980; 54% in 1990; 60% in 2000; 50% in 2010.
Why quote his question if you're not going to answer it?
The question is, when did rich people pay a greater percentage of their income in taxes, back when the top rate was 70 percent with lots of exemptions, or today when it's 35 percent with lots of exemptions?
Back then,and by a lot. The effective federal tax rate for the top 1% dropped from 47% in 1970 to 30% today. The top one-hundredth of one percent dropped from about 70% in 1970 to just under 35% now.
As usual, Drum reveals more about himself and his obsessions than about the people he purports to analyze. Any time your opponent favors a policy you don't, don't allow that it might be an actual reasoned opinion. Instead attribute to non-rational impulses manifesting as a religion-like dedication.
Well, it works both ways. As far as I can tell, those who cannot resist the urge to seize the wealth of others are born that way. They cannot help themselves in their unquenchable thirst to help themselves to the fruits of others' labor.
All I know is, I am tired of the farce of Democrats promoting taxes on "the rich."
Nancy Pelosi is worth $50 million. Did she become Speaker of the House for the purpose of raising taxes on herself?
Why quote his question if you're not going to answer it?
Re quotation: Because the information I provided was interesting in itself and relevant to both the question and the general nature of this thread, duh. What, am I the only one to do this that you single me out?
Re answer: Because it's just a dumb effing question (posed by a generally dumb poster). Obviously the rich pay more tax as a proportion of their income when the marginal rate is 70% than when 35%. Now, if MQ has some startling, revelatory inside info on the way the rich use loopholes such that contrary to all expectations they actually pay more nowadays, then let him reveal it instead of posing insipid questions ("The question is...")
Silver
epobirs:
The thing is, everyone in this debate is looking to grab the wealth of someone else to pay the bills for our underfunded pension scheme, unaffordable health care for the old scheme, and our ruinously expensive wars and gold plated military. The only question is who will pay, and how will the wealth be grabbed? It's not that liberals hunger for other peoples' wealth and conservatives want them to keep it. That's rhetoric, as sincere as any other political rhetoric, as sincere as Obama's Nobel Peace Prize acceptance speech or Clinton's speech where he said the era of big government was over, or Bush's speeches and debate appearances where he made it clear that under his administration, there would be no more of these silly nation-building exercises.
The default answer is that we keep deficit spending. That also requires that somebody pay taxes, just somebody in the future who can't currently vote. (Also, both deficits and debts have some potentially ugly conequences.) If you don't like that, we have to cut spending or raise taxes. It would be really nice if we could cut spending on useless or counterproductive stuff--foreign aid, farm subsidies, corn ethanol subsidies, etc. Unfortunately, while that stuff is wasteful and offensive, it doesn't actually have much effect on the budget. The big items there are our bloated military budget (which we could in principle cut, but nobody near power in either party has any intention of doing so) and all the stuff we do for old people. For different reasons, both those look politically very unlikely to be seriously cut. So where we seem to end up is that we have to come up with more revenue.
.
If you want to understand a fundamental limit on actually raising taxes on the rich, I recommend this article. If you want a powerful position in either party in Congress, you have to raise a lot of money. As in, there is an honest-to-God price list. You can't be Speaker of the House unless you can raise $X million dollars and share Y% with the party.
Consider who comes to those $3K/plate fundraiser dinners, and how important they are to getting to a position of power in congress. Then ask yourself how many ambitious congressmen or senators will actually do something to turn lots and lots of those people off.
To what extent do higher taxes result in income transfers from the rich to the super-rich? The super rich (at least the connected super-rich) have excellent wys of avoiding taxation while still maintaining control over huge amounts of capitol, 501c3s for example.) The rich pay most of teh taxes, which go toward programs that tend to benefit the super rich. Even programs that supposedly favor the poor really just weaponize them against the rich for the benefit of the super rich.
Eric, the Kennedys are instructive in the tax debate. Ted, like his mother, was officially a Florida resident when he died, so no estate tax was paid, though he spent his career harping on "paying your fair share". The web of trusts and foundations the family uses to protect their wealth is mostly offshore, with one in Fiji being the most egregious example regularly cited.
Right, or consider that Solyndra dude. He's "the rich." Am I meant to understand that the system that thought it critically important to just GIVE him half a billion dollars FOR NOTHING is suddenly going to turn around and "make him pay his fair share"?
It's preposterous. The cover story will be that they are going after the rich, but the actual effect will fall hardest on the upper middle class, because they are numerous enough, and well off enough to be worth stealing from, but not sufficiently well-connected to protect themselves.
Well said, huh?
There is no point in arguing with this on the merits. I just want to note once again: paleos like Steve are no conservatives, they are socialists who dislike immigration.
Socialists, huh? There is no point in arguing with you on the merits, because you presented none. I just want to note that calling me "socialist" doesn't phase me; I have a position (stop immigration), and you can like it or lump it. I'll let Steve speak for himself as to whether being called "socialist" bothers him.
If stopping immigration is "socialist," so be it.
Obviously the rich pay more tax as a proportion of their income when the marginal rate is 70% than when 35%.
And for the last effing time:
NOBODY pays over half their annual income in taxes; at 50% rates, the marginal utility of your labor is just too low to justify working. NOBODY smart enough to hit those kind of rates ever paid them.
If you are writing a check back to the IRS for over 50% of your labor, you are going to: shelter income, defer income, offshore income, rack up lots of deductions, take out a loan and take the rest of the year off, exercise stock options, cheat, etc.
Jeezus peet. I get this, and I'm not even rich.
First they came for Wall Street, and I said nothing...
Because Wall Street had already thrown me in jail.
First they came for the ANTI-SEMITES!!!, and I said nothing because I was not an ANTI-SEMITE!!!
Then they came for the racists, and I said nothing because I was not a racist.
Then they came for the right-wingers, and I said nothing because I was not a right-winger.
Then they came for me, and there was no one left to speak up for me.
"Anonymous said...
There is no point in arguing with this on the merits. I just want to note once again: paleos like Steve are no conservatives, they are socialists who dislike immigration."
You are probably a republican who styles himself a conservative. You are not.
Mainstream republicans have allowed themselves to become dupes of the wealthy. Just sit back and watch FOX News, and listen to how completely, terrifically wonderful rich people are. Listen to rich guys like John Stossel, and that braying nitwit, O'Reilly, or that barking idiot, Hannity, tell you how utterly invaluable billionaire hedge-fund managers are, just as they have been instructed to do by their billionaire masters such as Rupert Murdoch and the Koch brothers. They don't give one tinkers damn about your concerns. Their feigned concern over the conservative principals that we care about is nothing but bait to get us to vote for policies that increase their wealth and power.
"Anonymous said...
First they came for Wall Street, and I said nothing..."
First they came for Wall Street, and I said.........Hey, come back, over here, you missed one of them - he's hiding under his Jaguar.
Hey, a straw man fallacy so pathetic even a fifth grader wouldn't use it!
Thanks for the example! We'll avoid such AWFUL argumentation in future elementary school debates!
You made no argument. So a straw man fallacy is about what your comment earned.
Mac: ...anyone remember Pat Buchanan's idea from '06 or '07 to charge imports from VAT-levying nations a fee equal to their VAT rate?
I've seen a lot of people propose this as a reasonable tit-for-tat against not-so-crypto tariffs. Unfortunately, "VAT" has successfully been transformed into one of those voodoo words, the mere uttering of which will get Stupid Party loyalists a-gruntin' and a-hootin' about "socialists" wanting to destroy the "free market". So I don't expect to see any intelligent adult public discussion about the efficacy of VATs in this country, ever.
There's no good reason why capital gains tax rates should be lower than regular income tax rates. The reason usually given is that we need to encourage more investment. In fact there is too much money available for investment and not too little, which is why we keep going through these bubble-and-bust cycles. There's too much money chasing too few worthwhile investment opportunities.
Joe the Plumber,
And for the last effing time:
NOBODY pays over half their annual income in taxes; at 50% rates, the marginal utility of your labor is just too low to justify working. NOBODY smart enough to hit those kind of rates ever paid them.
The top marginal rate in Australia in 1986 was 60% and it kicked in at $35,000 (roughly $90,000 today). Is it really that unbelievable that someone earning $90k today might actually pay the going tax rate? What does the middle manager promoted to upper management do when he's boosted into a higher tax bracket? Quit work? Why? He's still making more money in total, even though a greater proportion of than before is eaten up by taxes. (Please, not some rant about incentives. I understand and accept all that. I'm not here to argue for soaking the rich.)
Anyway, the question raised was about 70% marginal rates (not 50%) versus 35%. Tax brackets in the past were highly graduated. They didn't just jump from, say, 40% to 70% in one go. There were plenty of gradations in between. Even if "no one" paid 70% there still plenty who paid in between 35% and 70%. Ipso facto the rich pay more tax when the top marginal rate is 70% than they do at 35
Silver
[Robert H.] Frank is one of the first to highlight the perversities of what are known as positional arms races. His book Choosing the Right Pond shows how important status is, and how much we pay for our status. Frank argues that the race for status is bad for society as a whole, as there cannot be improvement in overall status available, because every time person A rises above person B, the sum of their status remains the same. The only thing that changes is which person is where in the hierarchy.
http://en.wikipedia.org/wiki/Robert_H._Frank
In terms of lifestyle, it doesn't matter what rate the top 1% or 0.01% pay in taxes, since everyone at the same income level should be paying the same rate, progressive income taxes won't diminish anyone's status since everyone's taking the same haircut.
Of course "should" is the key word, someone who owns a hedge fund pays 15% tax rate while someone with the same income who owns any other kind of business pays a 35% tax rate.
also, the confusion between average and marginal tax rates by so many in this thread is pretty funny...if I have a 70 percent marginal tax rate for income over $1 million say, I would have less incentive to expand my income in excess of $1 million, but I certainly wouldn't want to quit my job and lose all my low-taxed income in the lower brackets too.
Q said...
There's no good reason why capital gains tax rates should be lower than regular income tax rates. The reason usually given is that we need to encourage more investment. In fact there is too much money available for investment and not too little, which is why we keep going through these bubble-and-bust cycles. There's too much money chasing too few worthwhile investment opportunities.
And these "investment opportunities" turn out to be no-good, old-fashioned usury.
"There is NO argument to be made that lower taxes lead to higher growth."
http://www.democratandchronicle.com/article/20111030/BUSINESS/110300339/Top-100-reaches-its-Silver-Anniversary?odyssey=tab|topnews|text|Business
"At the same time, there are barriers to growth. Businesses have long complained about the regulatory and tax burdens of operating in New York state, and survey respondents were nearly unanimous in their feelings on the subject."
But what do these small businesses know anyways, right? I'm sure they would have more growth if their taxes were raised. You have statistics to show that there is "NO argument" to be made.
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