FairTax

[timwhit]

Has anyone read about FairTax (http://en.wikipedia.org/wiki/FairTax) before? It sounds like an interesting idea in concept. I have my doubts that the federal income tax will ever be eliminated in my lifetime though.

[Bozo]

Riiiight. so a person living on $1000.00 a month Social Security and pays no income tax, now has to pay $0.30 on every dollar to buy FOOD. Most states exempt sales tax on food.
The rich get richer and the poor get poorer while the middle class pays all the bills.

And, you can't honestly think any company will lower their prices because of the removal of taxes. That extra money will go into the CEO's and board members pockets. Which means higher payoffs to the politicians.

Bozo :joker:

[timwhit]

Based on the below chart wouldn't a single person earning $1000/month get almost their entire earnings exempted from any taxes?

http://upload.wikimedia.org/wikipedia/en/7/7a/FTRebate.png

[ddrueding]

While I can appreciate the concept of eliminating the IRS, and agree that the current system is irreparably broken, I think an income tax is still preferable to a consumption tax. Didn't we have a discussion of a flat tax a couple years ago?

The problem with consumption taxes are that the rich spend a smaller amount of their earnings than the middle class do and therefore would have an effectively lower tax rate. We can ignore the poor, since every reasonable plan out there either doesn't tax them or gives it back.

We just need something simple. Hell, just take the current system and remove all deductions, loopholes, and exceptions. Have your taxes evaluated by your employer and deducted during each pay period. No annual re-evaluation where those in the know save and those who don't get screwed.

[jtr1962]

Riiiight. so a person living on $1000.00 a month Social Security and pays no income tax, now has to pay $0.30 on every dollar to buy FOOD. Most states exempt sales tax on food.

And food would be exempt under the FairTax as well, as would anything else currently exempt under most state tax laws. This myth of the poor being taxed more comes up every time the idea of a national sales tax is floated. Fact is a single person making $10 an hour in a place like NYC currently pays a good 25% of their income in income, FICA, and other taxes. If anything, that sounds even worse than a FairTax.



And, you can't honestly think any company will lower their prices because of the removal of taxes. That extra money will go into the CEO's and board members pockets. Which means higher payoffs to the politicians.

The free market will ensure that sooner or later someone will lower their prices once their expenses (i.e. taxes) go down. What you said only applies in the case of a monopoly.

Look at it this way-we've tried the income tax and it's been a massive failure. It's inherently complex, it's inherently unfair (the working poor still pay as much as 25% of their wages in income and FICA taxes), it invades your privacy, it requires a huge beaurocracy, etc. We have a whole army of accountants and tax lawyers who drain the economy without creating any real wealth. We have armies of drug dealers who don't pay a dime in taxes but would under FairTax. What's good about FairTax is that you go from about 300 million tax payers filing complex tax returns (counting all individuals and businesses) to some tens of millions of businesses simply sending in some percentage of their gross sales. Much simpler to implement and to catch cheaters. More importantly, there's less incentive to cheat since the customer pays the tax, not the business collecting it.

Just to be sure, I would only be in favor of the FairTax if income taxes on all levels of government are made unconstitutional. The EU passed the VAT some years ago under the promise of eliminating income taxes. Unfortunately, once politicians got their grubby paws on the extra money they were reluctant to give up the extra money. We don't need this happening here.

I'll also note that taxes on trade, which is really what the FairTax is, inherently keep government smaller. If trade is taxed too money, it withers and with it so do the taxes on trade. Higher income tax rates on the other hand don't cause a reduction in income and in turn less taxes. Rather, they allow government to get more revenue and become too large. Regardless of how taxes are collected, sooner or later we're going to have to start reducing entitlements and welfare (including corporate welfare). Medical entitlements alone threaten to bankrupt us. By eventually starving the government of revenue, the FairTax will force politicians to rethink how they spend our money very carefully.

[jtr1962]

We just need something simple. Hell, just take the current system and remove all deductions, loopholes, and exceptions. Have your taxes evaluated by your employer and deducted during each pay period. No annual re-evaluation where those in the know save and those who don't get screwed.
And what do you do for businesses? There's just no simple way to have an income tax on businesses. If you tax solely by gross income (revenue) then a business with huge income and huge expenses, but little profit, would pay an enormous amount in taxes. Another business with less income, but far less expenses, and hence more profit, would pay way less. And once you start taking business expenses into account when figuring taxable income, the whole thing blows up in your face again. There is just no such thing as a simple income tax. A sales tax, on the other hand, is easy. Send in x% of your gross receipts of taxable items. The government can decide which items are exempt from sales tax. This adds a little complexity, but nothing like even the simplest income tax. And let's face it, do you really want the government knowing your income? I sure as heck don't. The less the government knows about me the better. Picture in some future time the US government gets overthrown, and the masses are out to punish the upper classes. Don't laugh-the upper classes usually fair worst in any coup d'etat. Very easy to look through IRS files to find out whose house to go to. Any government records can be misused. The fewer records kept by governments on individuals, the better.

[Mercutio]

Any tax based on sales rather than income is regressive - placing an unfair burden on those who make less money. The only people who will actually pay less under the proposed fairtax than the current system are those who either make less than $15,000 (mostly they aren't paying taxes already) or make more than $200,000 (Hmm...). That's pretty much the opposite of fair.

[jtr1962]

You could get around the smaller percentage tax burden on higher income people by taxing luxury items at a higher rate. Sure, it adds complexity, and it's probably not in keeping with the FairTax philosophy of simplicity, but if milking the rich is your goal, then an income tax is not the only way to do it.

Even assuming that the middle class end up paying a higher percentage of their taxes than they do now, the FairTax would grow the economy enough so they would still be better off. Another thing to look at also are employer taxes. Under the current system, a person making $500 a week costs their employer an additional ~30% in FICA, unemployment, disability and other taxes. Under FairTax, this entire $650 (salary plus employer taxes) can be paid directly to the employee at no additional cost to the employer. That's already an instant 30% raise for most people.

Another important factor here is the time saved each year by not having to file tax returns. Most people hate doing so with a passion. Any change which eliminates that burden would have widespread popular support.

[Bozo]

Another thing to look at also are employer taxes. Under the current system, a person making $500 a week costs their employer an additional ~30% in FICA, unemployment, disability and other taxes. Under FairTax, this entire $650 (salary plus employer taxes) can be paid directly to the employee at no additional cost to the employer. That's already an instant 30% raise for most people.

Maybe all that snow you got is clouding your thinking. There is no way in hell any company is going to give an employee the extra money from not paying taxes. It will all go to CEOs, upper management, and board members.

Bozo :joker:

[timwhit]

Maybe all that snow you got is clouding your thinking. There is no way in hell any company is going to give an employee the extra money from not paying taxes. It will all go to CEOs, upper management, and board members.

Bozo :joker:

Let's say John Doe makes $100k/year. He is currently paying 7.65% of his salary for FICA, his employer is paying the same amount on his behalf. This is equal to $7,650/year each or $15,300 total. Let's say the government eliminates FICA and goes with FairTax or some other tax system. Don't you think John would wonder what happened to the $7,650 he should be getting from his company? This isn't peanuts, the average person would notice this. So, John gets pissed and leaves this job for another company that knows better and John gets paid his full amount. Let's say this happens a few hundred thousand times, well the majority of corporations will learn a lesson. It's very expensive for companies to have high turnover. Something like 30% of that person's salary. I don't think most companies are dumb enough to make this kind of error more than a few times. Remember that the labor market is a free market also, wages will follow if FICA is eliminated.

And if you are that worried, how hard would it be to write into the bill that employers have to tack on 7.65% to everyone's paycheck that they are paying that tax for the day the law is passed?

[jtr1962]

Maybe all that snow you got is clouding your thinking. There is no way in hell any company is going to give an employee the extra money from not paying taxes. It will all go to CEOs, upper management, and board members.

Funny but something just occurred to me. All that managerial dead weight you mentioned can no longer be written off as a business expense. I tend to think the FairTax will make companies streamline their operations as much as possible. That includes getting rid of all those do-nothing top management positions which the government now partially pays for. Maybe we'll actually go back to a system where the people whose labor brings in the revenue see the bulk of the profits.

And as Tim mentioned, the job market is a free market system as well. If one company doesn't add in the benefits to your pay, others certainly will.

[Bozo]

Hmmm... the only "Tax" that I am aware of that is jointly paid by the employee and employer is Social Security. I don't think that Social Security will go away because of a Fair Tax program, for Income Tax.

Bozo :joker:

[timwhit]

Hmmm... the only "Tax" that I am aware of that is jointly paid by the employee and employer is Social Security. I don't think that Social Security will go away because of a Fair Tax program, for Income Tax.

Bozo :joker:

You are thinking of FICA (http://en.wikipedia.org/wiki/Payroll_tax_in_the_United_States), which covers Social Security and Medicare.

Social Security and Medicare wouldn't go away with FairTax, but it's revenue source would change. The money would come out of the general tax fund, rather than being levied individually.

From the Wikipedia article I linked to in the first post:

The Fair Tax Act (H.R.25/S.1025) is a bill in the United States Congress for changing tax laws to replace the Internal Revenue Service (IRS) and all federal income taxes (including Alternative Minimum Tax), payroll taxes (including Social Security and Medicare taxes), corporate taxes, capital gains taxes, gift taxes, and estate taxes with a national retail sales tax, to be levied once at the point of purchase on all new goods and services.

[sechs]

First, let's stop calling it "FairTax." There's nothing inherently fair about taxation; some people will always pay less when they should pay more, and vice versa -- with nothing said about gain from the spending of the proceeds.

The problem that I see with a sales tax is that it is regressive. Income tax can (and, if you throw out the baloney in our system, is) progressive. And the fact of the matter is, once we switch systems, the lobbies will get in there and put in the same kinds of loopholes and deductions that we have now.

So, why spend all of the time and money to switch to a system which initially will be the opposite of what most people consider good and eventually won't be any better than what we have now?

[Howell]

Once basic needs are exempted is it really important that the sales tax isn't "fair"?

[timwhit]

Once basic needs are exempted is it really important that the sales tax isn't "fair"?

It's not fair unless everyone can afford a 50" 1080p LCD television. ;-)

[jtr1962]

Even if in the end it's no more "fair" than the income tax (which isn't really very fair) it'll be a heck of a lot simpler to implement. And finally April 15 will be just another day on the calender for most people. Sure, accountants and lawyers will fight this tooth and nail for obvious reasons, but in the end it'll benefit just about everyone else.

BTW, the notion that the working poor currently don't pay taxes under our system is a myth. Maybe they don't-if they happen to have enough kids and get a decent amount of EIC. If you're single, forget it. At best the EIC equals the amount you pay in FICA taxes. And after roughly $5500 it starts phasing out. A single full-time worker earning minimum wage can't claim a dime in EIC because they make too much. When I used to earn $7 an hour (equivalent to maybe $10 an hour now-basically working poor) I saw $220 of my $280 paycheck. And I more or less broke even come tax time. Add in sales tax I paid over the course of the year and an easy 30% of my low wages were gone.

All those who are against a sales tax because of its "regressive effect on the poor" should push to reform the income tax so that anyone making under about $25K (more in a high cost of living area like NYC), including single people, don't have to pay a dime in taxes. No federal, state, local, or FICA deductions whatsoever.

[Howell]

Even the accountants I know are for a "fair" or flat tax. Haven't asked any lawyers.

[Mercutio]

All those who are against a sales tax because of its "regressive effect on the poor" should push to reform the income tax

Any sales tax is regressive. I'm not suggesting that tax codes shouldn't be reformed. I am suggesting that taxation based on sales as the sole method of funding government programs is going to result in a shifting of burdens away from the people who can best afford to pay taxes.

Even 10% of your $10/hour means a lot more to you than 30% of (say) my $45/hour. That's just math. I've got $31.50 of my money to cover expenses and saving while you're worried about basic needs whether you have $9 or $10 of your income. That's just math, man. I'm saying that those of us who can buy a $4 cup of coffee every morning on the way to work without considering what that's going to do to our personal finances (or, in my case, 40 or so $3.50 comic books a month) probably ought to face a little more of the burden than a guy who notices when the price of his favorite cereal goes up $.50.

[Howell]

"Regressive" is not automatically bad just like progressive is not automatically good.


Main Entry:
re·gres·sive Listen to the pronunciation of regressive
Pronunciation:
\ri-ˈgre-siv\
Function:
adjective
Date:
1634

1 : tending to regress or produce regression 2 : being, characterized by, or developing in the course of an evolutionary process involving increasing simplification of bodily structure 3 : decreasing in rate as the base increases <a regressive tax>

[Mercutio]

"Increasing simplification of bodily structure " would be acceptable. However, the use in question here is definition #3: decreasing in rate as the base increases, which I think we can agree in fact and in practice to be a bad thing.

[jtr1962]

Any sales tax is regressive. I'm not suggesting that tax codes shouldn't be reformed. I am suggesting that taxation based on sales as the sole method of funding government programs is going to result in a shifting of burdens away from the people who can best afford to pay taxes.

Even 10% of your $10/hour means a lot more to you than 30% of (say) my $45/hour. That's just math. I've got $31.50 of my money to cover expenses and saving while you're worried about basic needs whether you have $9 or $10 of your income. That's just math, man. I'm saying that those of us who can buy a $4 cup of coffee every morning on the way to work without considering what that's going to do to our personal finances (or, in my case, 40 or so $3.50 comic books a month) probably ought to face a little more of the burden than a guy who notices when the price of his favorite cereal goes up $.50.
OK, let's do it a little different. We agree that the poor shouldn't be taxed at all, and those who make well above average should be taxed more than those who are middle class. How about a sales tax with the following characteristics:

1) Basic necessities like food and items of clothing costing under $100 are exempt.

2) Rent under a certain amount per month ($1500?) is exempt.

3) Luxury items, defined as those costing at least 50% more than the average retail price for a particular item, are taxed at twice the regular rate, or 46% in the case of the proposed Fair Tax.

4) Luxury housing is subject to the regular sales tax. Non-luxury housing isn't. The determination of whether housing is luxury or not is based on its sales price relative to a lowest cost unit of the same square footage in the same area. Or perhaps you could subject entire neighborhoods to the luxury tax. Hard to argue that all of midtown Manhattan isn't luxury housing, for example. Sure, this part gets complicated, but it's nowhere near as bad as any income tax system.

I also think a wealth tax in conjuction with a sales tax might not be a bad thing. Nobody can reasonably use more than, say, $10 million unless they spend it on expensive, nonsense items. Have a progressive tax on all net worth in excess of $10 million. Perhaps 10% of the first $90 million over $10 million, eventually rising to 100% for any wealth in excess of $1 billion. Is it fair? I think so. Nobody with that kind of wealth earned it in the conventional sense. Rather, they gamed the system in their favor or got very lucky. Blind luck shouldn't be rewarded under any system, at least not to the extent of tens of millions of dollars. The net effect of a wealth tax would be to drop salaries on the high end (no more $600 million CEOs), discourage the very rich from working (and thus give someone else a shot a making money), drop the price of luxury housing (and to some extent regular housing, making it more affordable), plus a bunch of other things. Any money taken here could be used to reduce the sales tax burden on the middle class by lowering the rate.

[rant]

Don't get me wrong. I'm not against disparities of wealth in society. It gives people something to strive for. What I am against is the disgusting current situation where the wealthiest 1% hold thousands of times more wealth than the poorest 10%. I agree multimillionaires have a place in society. However, 100 people with $10 million each will do far more good than a single person with $1 billion. Nobody should be worth tens or hundreds of billions. Nobody should be earning $20 million a year like many celebrities. There's a difference between striving to be financially independent and naked, unmitigated gluttony. As a person of modest means, I'd honestly be dumbstruck if $1 billion fell into my lap. Probably the only thing I could reasonably think to do with it would be to keep $10 million for myself, and give a few million each to several hundred people who either spent their lives working their asses off, or who were poor due to a perpetual run of bad luck. I sure as sh*t wouldn't go buy a yacht or a private plane or an island or even a luxury automobile. I need those like a hole in the head. Three months down the road none of that crap would do squat for me. The only thing of value money could ever give me is freedom from having to punch a clock and do someone else's bidding.

[end rant]

[jtr1962]

BTW, if anything I just wrote above sounds incoherent, it's because I spent 18 hours today assembling regulator boards full of components the size of fleas. In other words, I can't even see straight right now.

[Tannin]

the upper classes usually fair worst in any coup d'etat

Errr .... Which planet are we discussing here? It's certainly not Planet Earth. The number of coups in which the upper classes have suffered worse than the poor are few, very few. In all of recorded history, you could count them on your fingers. Thinking about it a little more, it occurs to me that you could probably count them on your thumbs. I was going to cite the two obvious examples where the rich lost out - the French and Russian Revolutions - but then I though a bit harder and remembered that the upper classes, in both cases, fell into three groups: those that got killed (a quite small number, in point of fact), those that were reduced to poverty, and those that managed to retain a lot of wealth either offshore or through some influence peddling (by far the majority, certainly the case in the French Revolution, which was the bloody one). Compare this with the fate of the poor: millions - and I do mean millions died. Mostly they starved to death, but the other great killer of the nameless poor was war. And remember that here I am thinking of the [i]worst[/i[ examples I can bring to mind, the ones least favourable to my case. Whichever way you slice it, it's the poor that suffer most.

[Stereodude]

I also think a wealth tax in conjunction with a sales tax might not be a bad thing. Nobody can reasonably use more than, say, $10 million unless they spend it on expensive, nonsense items. Have a progressive tax on all net worth in excess of $10 million. Perhaps 10% of the first $90 million over $10 million, eventually rising to 100% for any wealth in excess of $1 billion. Is it fair? I think so. Nobody with that kind of wealth earned it in the conventional sense. Rather, they gamed the system in their favor or got very lucky. Blind luck shouldn't be rewarded under any system, at least not to the extent of tens of millions of dollars. The net effect of a wealth tax would be to drop salaries on the high end (no more $600 million CEOs), discourage the very rich from working (and thus give someone else a shot a making money), drop the price of luxury housing (and to some extent regular housing, making it more affordable), plus a bunch of other things. Any money taken here could be used to reduce the sales tax burden on the middle class by lowering the rate.Wow, I think I can officially label you a socialist. It must be nice to live in some delusional utopia where you think life is a big lottery and some people get lucky and make it big. The people who make it big aren't generally lucky. Generally they're people who took big risks and made it big. Punishing success is a very dangerous thing to do because someone has to foot the bill for all the "poor" people who aren't paying their fair share.

Even if we assumed you have half a clue what you're talking about, you don't take into account human nature. If you tax 100% of the wealth over 1 billion dollars do you know how much you'll get in taxes. $0. No one will sit by and let 100% wealth over $1 billion dollars get taken away. They will find a way to shield it from the taxes, they will move to another country with their money, they will do something, but they're not going to sit by and take that.

For example, lets say you tax income over $1 million a year at 100%. No one is going to make more than $1 million a year. They will instead make $1 million a year, and get a ton of perks from the company to compensate for the lower salary. People will always find a way around the system.

Here's a little graph for you to choke on.

[ddrueding]

Nice graph, stereodude.

[jtr1962]

The graph shows the upper 25% with much of the tax burden. That's upper middle class, a group I'm not concerned with here as they usually get there through hard work. The upper 1% has a relatively small share of the tax burden compared to their ability to pay. Under Hong Kong's system I think the upper 1% pay almost all the taxes (and the top rate is only 15% IIRC).



The people who make it big aren't generally lucky. Generally they're people who took big risks and made it big.

"Taking a risk and making it big" is the very definition of luck. And unfortunately thanks to the hoarding of wealth by the upper 1% few people are in a position to have much to risk, even if they wanted to. Basically what I'm interested in here is increasing the opportunties for the lower classes to acquire wealth. In a society where most of the wealth and the means of production is controlled by a few, it's practically impossible for an average person to become even wealthy enough to quit their job if they're pre-Social Security age. Indeed, hourly wages are just another form of indentured servitude given the level of average wages relative to the cost of living.

Funny how you or really anyone else here can defend the current system under which your chances of becoming even moderately wealthy are close to zero. You and probably everyone else here will be working until their 70s at least just to get by. I don't plan to officially retire at all because I doubt I would ever be able to.

You might want to read this (http://www.zmag.org/content/showarticle.cfm?ItemID=6842) piece on the failings of capitalism. I can't say I like their solution of "participatory economics" much though. I think distributism (http://en.wikipedia.org/wiki/Distributism) without the religious overtones is a better, fairer system.

P.S. I'm not a socialist. One of the cornerstones of socialism is an income tax to redistribute wealth. I hate any and all taxes on income. My proposed tax on wealth was designed simply to correct a massive inbalance of wealth which currently exists, not to distribute it evenly as is done under socialism. Nothing is more stupid or encouraging of laziness than to distribute wealth evenly. Under my system people can still get rich, just not billionaires. That's plenty of incentive for most of us.

[Stereodude]

It's not the job of the gov't to correct an imbalance of wealth. Not to mention the US is far more balanced than most countries.

[Stereodude]

The graph shows the upper 25% with much of the tax burden. That's upper middle class, a group I'm not concerned with here as they usually get there through hard work. The upper 1% has a relatively small share of the tax burden compared to their ability to pay. Under Hong Kong's system I think the upper 1% pay almost all the taxes (and the top rate is only 15% IIRC).I don't think you understand where the threshold is for the 25% or 1% or whatever category you're talking about.

Here are the income split points (AGI) and the average tax rate paid by each from 2005:
1% - $364,657 - 23.13%
5% - $145,283 - 20.78%
10% - $103,912 - 18.84%
25% - $62,068 - 15.86%
50% - $30,881 - 13.84%
Bottom 50% - $0 - 2.98%

Exactly how much more lopsided can we make the tax system?

[Stereodude]

Here are some interesting statistics about the 37 million "poor" people we have in the US:

* Forty-three percent of all poor households actu*ally own their own homes. The average home owned by persons classified as poor by the Census Bureau is a three-bedroom house with one-and-a-half baths, a garage, and a porch or patio.

* Eighty percent of poor households have air conditioning. By contrast, in 1970, only 36 percent of the entire U.S. population enjoyed air conditioning.

* Only 6 percent of poor households are over*crowded. More than two-thirds have more than two rooms per person.

* The average poor American has more living space than the average individual living in Paris, London, Vienna, Athens, and other cities throughout Europe. (These comparisons are to the average citizens in foreign countries, not to those classified as poor.)

* Nearly three-quarters of poor households own a car; 31 percent own two or more cars.

* Ninety-seven percent of poor households have a color television; over half own two or more color televisions.

* Seventy-eight percent have a VCR or DVD player; 62 percent have cable or satellite TV reception.

* Eighty-nine percent own microwave ovens, more than half have a stereo, and more than a third have an automatic dishwasher.

Another Chart letting us know how bad the poor really have it (http://www.heritage.org/Research/Welfare/images/b2064_chart1-lg.gif)

[jtr1962]

Here are some interesting statistics about the 37 million "poor" people we have in the US:

* Forty-three percent of all poor households actu*ally own their own homes. The average home owned by persons classified as poor by the Census Bureau is a three-bedroom house with one-and-a-half baths, a garage, and a porch or patio.

* Eighty percent of poor households have air conditioning. By contrast, in 1970, only 36 percent of the entire U.S. population enjoyed air conditioning.

* Only 6 percent of poor households are over*crowded. More than two-thirds have more than two rooms per person.

* The average poor American has more living space than the average individual living in Paris, London, Vienna, Athens, and other cities throughout Europe. (These comparisons are to the average citizens in foreign countries, not to those classified as poor.)

* Nearly three-quarters of poor households own a car; 31 percent own two or more cars.

* Ninety-seven percent of poor households have a color television; over half own two or more color televisions.

* Seventy-eight percent have a VCR or DVD player; 62 percent have cable or satellite TV reception.

* Eighty-nine percent own microwave ovens, more than half have a stereo, and more than a third have an automatic dishwasher.

Another Chart letting us know how bad the poor really have it (http://www.heritage.org/Research/Welfare/images/b2064_chart1-lg.gif)
Most of those trinkets aren't terribly expensive, and quite of bit of them are probably bought used, especially the car, or even taken from dumpsters in richer neighborhoods. And I'm sure a fair amount is stolen. Also, maybe you and I have a different definition of "poor". To me poor is someone making $3 an hour, or perhaps minimum wage if they're lucky enough to get a job on the books. A family of four making $30,000 a year might be considered statistically poor, but they still are better off than a lot of others.

Also, if these poor are forced to go to a job they hate every single day until their bodies are so worn out they just can't any more, exactly how good is that? That's such a great life even if they have a few scraps from the king's table? Heck, I wanted to jump in front of the train every day when I was working shitty jobs I hated. Between the low pay, the amount of my free time it took, the pains in my body from repetitive exertions, and the boring work itself the whole situation was an existence. And incidentally how many of these poor have to work two or even three such crappy jobs to get the kind of lower-middle class lifestyle you described? Not being in charge of your own destiny, or even contemplating a time when you can be, is what is so very wrong nowadays.

[jtr1962]

Oh, I forgot to mention, as far as the poor "owning" their own homes, I have two words-subprime loan. Between these shady loans, and borrowing what little equity there was in their homes, many "poor" managed to live above their means, at least up until now. Look for lots of foreclosures soon as these loans come due, and there's no more equity to borrow as home prices fall. Fact is the poor never owned their homes. The banks did. Nobody making $30K a year can afford a $300K home.

[Bozo]

The problem with that report on the poor, it doesn't give details.
I know a few people that live on $900.00 a month Social Security. That is classified as poor. They live in a house that they bought when they were working. They drive the last car they bought when they were working. They have the same color TV that they bought when they were working.
Most have a part time job but they can only work 28 hours a week or lose their SS. They work to pay the property taxes on their home so they don't have to sell it.
They don't pay income tax as they are below the taxing threshold. And the Fair Tax plan wants to take $0.30 of every dollar they spend. Not to "Fair" to me.
And, they are on Medicare, which they must pay deductables and 'co-pay'. Medicare does not cover eyes or teeth. Have a tooth ache? Tough. Need new glasses? Sorry. all that has to come out of your $900.00 a month.
The censes statistics are bogus, misleading, and waaay off the mark.

Bozo :joker:

[Clocker]

Oh, I forgot to mention, as far as the poor "owning" their own homes, I have two words-subprime loan. Between these shady loans, and borrowing what little equity there was in their homes, many "poor" managed to live above their means, at least up until now. Look for lots of foreclosures soon as these loans come due, and there's no more equity to borrow as home prices fall. Fact is the poor never owned their homes. The banks did. Nobody making $30K a year can afford a $300K home.

I'm sure our tax dollars will bail them out.

[Stereodude]

Oh, I forgot to mention, as far as the poor "owning" their own homes, I have two words-subprime loan. Between these shady loans, and borrowing what little equity there was in their homes, many "poor" managed to live above their means, at least up until now. Look for lots of foreclosures soon as these loans come due, and there's no more equity to borrow as home prices fall. Fact is the poor never owned their homes. The banks did. Nobody making $30K a year can afford a $300K home.If you say so... :rolleyes:

As the chart shows, some 43 percent of poor households own their own home. The typical home owned by the poor is a three-bedroom house with one-and-a-half baths. It has a garage or carport and a porch or patio and is located on a half-acre lot. The house was constructed in 1969 and is in good repair. The median value of homes owned by poor households was $95,276 in 2005 or 70 percent of the median value of all homes owned in the United States.

[Stereodude]

Also, maybe you and I have a different definition of "poor". To me poor is someone making $3 an hour, or perhaps minimum wage if they're lucky enough to get a job on the books. A family of four making $30,000 a year might be considered statistically poor, but they still are better off than a lot of others.Well, there aren't 37 million of them.

Also, if these poor are forced to go to a job they hate every single day until their bodies are so worn out they just can't any more, exactly how good is that? That's such a great life even if they have a few scraps from the king's table? Heck, I wanted to jump in front of the train every day when I was working shitty jobs I hated. Between the low pay, the amount of my free time it took, the pains in my body from repetitive exertions, and the boring work itself the whole situation was an existence. And incidentally how many of these poor have to work two or even three such crappy jobs to get the kind of lower-middle class lifestyle you described? Not being in charge of your own destiny, or even contemplating a time when you can be, is what is so very wrong nowadays.America lets people become whatever they want to be. People aren't stuck in the "caste" they're born into. If someone doesn't want to be "poor" they can change their circumstances. The constitution doesn't promise everyone to be rich. It doesn't promise that we'll all have the same amount of money or success. The gov't isn't supposed to ensure equal outcomes for everyone. That's not their job, and the tax code isn't supposed to be used to accomplish that.

[sechs]

It's not the job of the gov't to correct an imbalance of wealth.
So, what is the job of the government?

[ddrueding]

So, what is the job of the government?

Not much.

[Stereodude]

So, what is the job of the government?You aren't really going to sit there and try to argue with me that the government is supposed to take money from the rich and give it to the poor?

As ddrueding points out the job of the gov't isn't much. Other than protecting the people in the country from outside influences and aggression (like other countries) they don't have many jobs.

[Mercutio]

I'd be more than happy to argue that the job of any worthwhile government is to create and enforce social justice.

Also, one of the jobs of the US government is to regulate interstate commerce, which covers an enormous amount of ground.

[Stereodude]

I'd be more than happy to argue that the job of any worthwhile government is to create and enforce social justice.Ahh... but justice doesn't equal fairness, or equal outcomes.

[Mercutio]

Ahh... but justice doesn't equal fairness, or equal outcomes.

That's why we have to keep trying until we get it right. I'd go further and say that members of a society with a functional government need to subjugate their individuality in order to more fully allow that government to create a just and fair society. And in the case of wealthy people, that means being altruistic enough to allow an additional burden of taxation.

[ddrueding]

How much additional tax, Merc?

[Mercutio]

In my mind, as much as need be. I don't mind paying taxes when I can see a benefit.

[jtr1962]

It's probably not a bad idea for government to do some things to level the playing field a bit. For example, everyone should have access to decent education and transportation, whether or not they can afford tuition, or buy a car. So public education and public transit are good things to spend money on, provided there's enough oversight to limit the amount of graft. I start to draw the line at things like anything beyond basic medical care, however. Medicaid is a money pit largely due to fraud on the part of care providers, and abuse of the system on the part of recipients. Making something free creates near infinite demand for it. The same people who wouldn't go to a doctor if they had to pay unless they have a severe flu will go to one for every hanged nail or pimple when it's free. Beyond that, I just don't see why public money should be used to treat people who abuse their bodies to hell through drugs, smoking, overeating, not exercising. The minute you have any preventable conditions you should be forced to pay higher copays than someone who doesn't. Medicaid, or even nationalized public health care, might be affordable if we had a culture of health and preventive medicine in this country. It works in most European countries which have it for that reason. I can guarantee that once obesity and other preventable conditions creep up in those countries, they may well abandon universal health care as unaffordable.

Many of the same things about Medicaid can be said about Medicare. The prescription drug program, pushed by both parties, was a colossal mistake. The vast majority of seniors are on drugs for conditions which could be fixed by a lifestyle change. Eventually, the pills result in yet more health problems, starting a downward spiral which results in lots of people dying in the 70s or 80s, instead of 90s or 100s, and with huge medical bills. I don't blame conservatives for wanting to get rid of Medicare in its present form. Until people in this country start taking their health seriously, any money spent on any public health care beyond basic vaccinations is wasted.

[ddrueding]

The conclusion I keep coming to on these things is that no matter what the policy is, it won't work well and will cost a lot.

I had this pointed out to me at dinner the other day when I was advocating a less invasive foreign policy (pardon the pun). The other person pointed out, and rightly so, that not defending our interests elsewhere would also have ill effect, possibly as bad as our current policy.

I didn't disagree, instead I simply suggested we choose the least costly of the two bad ideas.

This is where my more libertarian viewpoint comes from. Not that I don't want everyone to be enducated and have healthcare, but that they won't get it regardless due to corruption, greed, and inefficiency. If they aren't going to get it, I'd rather not pay for it.

[jtr1962]

That's exactly the point. I think more people would support these programs if they actually worked as claimed. Case in point was LBJs $4 trillion (last I checked) "War on Poverty". It turns out the major beneficiaries of years of welfare/Medicaid spending were the service providers, especially those politically connected. As for the poor who were supposed to have been helped, things were worse than under the older systems of "home relief". The same can be said to a lesser degree about public education. All this money spent, yet our children consistently grow up to be moronic adults who can't even use proper grammar or spelling. Moreover, they lack critical thinking skills. Of course, this makes it easier for politicians to dupe them, or advertisers to sell them crap they don't need. Given this, it's hard to argue against things being this way precisely because that's how those in charge want them. A population of complacent, dumb sheep is very easy to mislead. Maybe a similar line of thought went into welfare. Let's make all these poor people dependent upon government, and we'll consistently get votes. Never mind that the precise purpose of helping them is so they can function on their own eventually.

So given a choice between spending a bucket of money on a program which won't work as intended, or not bothering at all, I'll also take the consequences of not bothering at all. The end result is probably equally bad either way, but I'll pay less taxes. And make no mistake, it's always the middle class, not the rich, who pays the largest percentage of their needed income for these programs. Even if a rich person pays 90% of $100 million, they still have $10 million left, most of it disposible income if you use normal cost of living standards. They're still very well off any way you look at it. A middle class family making $40,000 a year but paying only 20% in taxes loses $8,000, all of which it could definitely use.

[Stereodude]

That's exactly the point. I think more people would support these programs if they actually worked as claimed.Well, that's just it. You don't have to be a rocket scientist to figure out that gov't programs never work as claimed.

[Howell]

That's why we have to keep trying until we get it right. I'd go further and say that members of a society with a functional government need to subjugate their individuality in order to more fully allow that government to create a just and fair society. And in the case of wealthy people, that means being altruistic enough to allow an additional burden of taxation.

That can only achieve what you want if you could create and enforce a moral society.

[Mercutio]

That can only achieve what you want if you could create and enforce a moral society.

I think we can draw a distinction between a moral society and a fair society. Morality is a confusing topic for a lot of religious people; a lot of them seem to assume that morality is something that can only be established from (their own) religion. It's not a word I would wish to drag into this discussion.


Well, that's just it. You don't have to be a rocket scientist to figure out that gov't programs never work as claimed.

A lot of government programs do work well. I think our public education system works very well. There are some failings (particularly in large cities) but overall, considering the number of different, and different kinds of people we educate, and the depth and breadth of education, I'd say we do a pretty good job. Students today learn things that, in my parents' time, weren't taught until college.

There are programs that certainly can work better, but whenever I hear small government types bitching about all the things the government does, I find myself wondering what life in the US would be like if we didn't have things like the FCC, FDA or the SEC. I wonder how we'd educate children (especially how well we'd educate in different parts of the country), or if we'd have national parks or maintain roads that aren't used frequently.

The main point I'd like to make is that there is no charity or organization that exists that can do as much as the collective tax dollars of the citizens of the United States. Most - certainly not all, but most of the money we pay in taxes is for the collective well being of citizens of this country. You or I might not agree with how that money is spent, but it is returned to us.

If your answer to everything is "let the market decide", or "the government doesn't work so let's just get rid of the whole thing", I'd just like to point out that there ARE pure libertarian/capitalist societies in the world. Places like, oh, Somalia. Look how well that works in practice.

[Bozo]

The tax is not "fair". People that make less than ~$25k per year or are on fixed incomes get screwed royally. Most of these people pay little or no income tax. (SS is taxed BTW). But, in our state, there is no sales tax on food and clothing. The so-called "fair" tax would have these people paying tax on these items.
Try living on $940.00 A MONTH, then have $20-$30 more lost to the so-called "fair" tax.
This is just another plan to give more to the rich, and have the middle class and poor pick up the tab.

Bozo :joker:

[Howell]

I think we can draw a distinction between a moral society and a fair society. Morality is a confusing topic for a lot of religious people; a lot of them seem to assume that morality is something that can only be established from (their own) religion. It's not a word I would wish to drag into this discussion.

I understand what you mean. Fairness is just as squishy a term as morality though.



If your answer to everything is "let the market decide", or "the government doesn't work so let's just get rid of the whole thing", I'd just like to point out that there ARE pure libertarian/capitalist societies in the world. Places like, oh, Somalia. Look how well that works in practice.

What are your thoughts on Venezuela and Zimbabwe and well that society is turning out?

[Stereodude]

What are your thoughts on Venezuela and Zimbabwe and well that society is turning out?Lets not forget Cuba and the Soviet Union either.

[sechs]

You aren't really going to sit there and try to argue with me that the government is supposed to take money from the rich and give it to the poor?
No, and you are quite foolish to assume that.

The fact of the matter is, if you can't articulate exactly what the government is *supposed* to do, then there's really no way to determine what it is *not supposed* to do.


As ddrueding points out the job of the gov't isn't much. Other than protecting the people in the country from outside influences and aggression (like other countries) they don't have many jobs.
That's not an answer; it's a cop-out (to both of you).

[sechs]

It's probably not a bad idea for government to do some things to level the playing field a bit. For example, everyone should have access to decent education and transportation, whether or not they can afford tuition, or buy a car. So public education and public transit are good things to spend money on, provided there's enough oversight to limit the amount of graft.
The fact of the matter is, even if you don't subscribe to wealth redistribution as a job of the government, doing so is for the common good.

Especially now, an educated workforce is advantageous. Corporations don't want to hire dummies. Without a system of public education, we'd be importing a lot of goods and services because we couldn't do it here. And, as our oil importation habit has shown, we would end up sticking our heads in places which we otherwise would not, to defend ourselves. That's not a better place, even for the rich people.

How about if every road was toll? How fun would that be?

[sechs]

Well, that's just it. You don't have to be a rocket scientist to figure out that gov't programs never work as claimed.
As long as there are people involved, government will never be perfect.

If you don't like what we have here, you are free to go to a nation with a better system. Let me know which one, if you do.

[Mercutio]

I understand what you mean. Fairness is just as squishy a term as morality though.

That may very well be true, but there's no reason to conflate this discussion with the possibility of attaching religious values. Since I've had the faithful tell me many times that unless my behavior is governed by their holy book I am by definition amoral, morality is a word I'd sooner avoid.


What are your thoughts on Venezuela and Zimbabwe and well that society is turning out?

Venezuela has somewhat charismatic but obviously paranoid authoritarian would like very much to replace Fidel Castro as the hobgoblin of American politics. Hugo Chavez has been doing some very interesting things with his oil wealth - including offering free heating oil to residents of the US, and free health care and post-secondary education to any Venezuelan citizen. He's a hard statist, having seized control of the media and electoral process (one might argue that Mr. Bush has done something similar in this country, through Roger Ailes' Fox Networks, Murdoch's media empire, and through the very obvious Republican control of Diebold, one of only two companies that make voting machines) and over time I suspect that he'll become more and more a dictator, but he was repeatedly elected to his office and had enough popular support to overcome a coup in recent memory. My understanding of present-day Venezuela is that it's on pretty stable ground economically, with the lives of poor citizens being improved greatly by Chavez's oil-funded social programs.

Most nations which successfully manage quasi-socialism have built it on the back of high taxes and state owned oil programs. I am well aware of that. They're also consistently ranked to be among the best places on Earth in which to live.

I'm less familiar with the situation in Zimbabwe, though I know it's presently in a state of crushing hyperinflation; I have no doubt that Zimbabwe has crushing foreign debt and a vast trade deficit. I know that Mugabe is essentially a warlord who is bent on engaging in tribal warfare in the Congo. I don't know anything about its social programs or the structure of its government.

Stereodude, the Soviet Union hasn't existed for over 15 years. If you're talking about Russia, I think that on the whole, the situation on the ground is essentially unchecked capitalism (inflation, unemployment, lack of regulation for most businesses and transactions) with a government that has some very strong authoritarian tendencies and a habit of seizing profitable private industries in the name of State Interest. Russia today in no way resembles a Socialist state; those state-owned businesses are turned over to cronies and run for the enrichment of the politically connected (Think Haliburton).

[Stereodude]

Stereodude, the Soviet Union hasn't existed for over 15 years.I'm well aware of that, but it didn't exactly work out so well for the citizens. Yeah, they had all equal outcomes... Equally poor and miserable.

[Stereodude]

If you don't like what we have here, you are free to go to a nation with a better system. Let me know which one, if you do.Just cause we have the best system doesn't mean it couldn't be better. To assume that just because we have the best system, that it can't be any better is foolish.

[Stereodude]

The fact of the matter is, if you can't articulate exactly what the government is *supposed* to do, then there's really no way to determine what it is *not supposed* to do.You're out to lunch...

The gov't's job is to stay out of the way of its citizens and empower them, not run and control their lives. I don't have to be able come up with a comprehensive list of what gov't should do. I don't have one already thought up. That's not the way I think. The gov't isn't my god. I don't worship at the altar of big gov't. I could get up in the morning and survive if the gov't was shut down.

[Mercutio]

I'm well aware of that, but it didn't exactly work out so well for the citizens. Yeah, they had all equal outcomes... Equally poor and miserable.

I could suggest that the outcome might've been different had the Soviet Union not been trying to compete in an arms race with the US. The USSR also never really recovered from World War II; they sent a whole generation of men into a meat grinder against Hitler's troops, wasted another generation on imperialism and a third fighting uprisings like the one in Afghanistan. Having the outward and militaristic focus that it did, it is perhaps less than surprising that the welfare of its citizens suffered.

[Mercutio]

The gov't's job is to stay out of the way of its citizens and empower them, not run and control their lives.

Well, properly speaking the purpose of government - any government - is to provide a framework for behavior and interactions among its citizens. A government does this through force of law - which primarily exists as a set of rules and regulations for what individuals cannot do.

Laws and regulations are a necessary part of a functional society; the fewer laws we have, the closer we are to anarchy, a condition in which there is less control over what individuals can do and therefore a greater possibility of some uncontrolled inequity might exist. You, Stereodude, are thinking of that inequity as the possibility for some greater amount of wealth or additional expression of your religious beliefs. I'm thinking of it as the possibility that certain individuals with no responsibility for anyone else might gain so much power over others that they could act or not act with the force of law (Think Haliburton in Iraq, or the power that HMOs have over medical care in the US), and I find that idea loathsome.

[ddrueding]

Wow, I think I disagree with everyone on some pretty fundamental levels...let me step in and make an uneducated stab at it.

The problem we have is that smart (sometimes corrupt) people are finding more and more interesting ways to take money from dumb (sometimes innocent) people. A politician says that this is unfair and the dumb people agree (because it sounds like they will get a better deal). Since the dumb people are in the majority, the law or bill gets passed. Unfortunatly for them, the politician is one of the smart and corrupt people, and is using them to get more money and power for himself.

If the government controls everything, than they can do this with all the power and money. This worked well (for the smart ones) in the Soviet Union for a long time. Notice I didn't say what type of government above, because it really doesn't matter. Any type of government will do this with any power they are given.

With a minimal government, at least I have a fighting chance of keeping what I work for and setting my own quality of life. The government would love to take that away from me, give 10% to some tornado victim who lives in "tornado alley" or a fire victim who lives in a forest, and keep the rest for themselves and their friends.

What percentage of the upcoming $145B relief package is pork? Who knows? They will pass it so fast that no one will have a chance. This administration is running up a massive deficit and cutting taxes at the same time! The idiot masses are loving it. The same idiot masses, I might add, who run up their credit card bills without noticing or sign mortgages they could never afford! Meanwhile, the next administration will be forced to raise taxes and cut programs. But it really isn't them that did it, their hand was forced, like being the last guy from your group at the bar holding the tab.

Paranoid? Shouldn't I be? Anarchist? Just a little...

[Stereodude]

I could suggest that the outcome might've been different had the Soviet Union not been trying to compete in an arms race with the US. The USSR also never really recovered from World War II; they sent a whole generation of men into a meat grinder against Hitler's troops, wasted another generation on imperialism and a third fighting uprisings like the one in Afghanistan. Having the outward and militaristic focus that it did, it is perhaps less than surprising that the welfare of its citizens suffered.Socialism and communism fail every time it's tried but yet people try to explain away the failures as the result of some outside pressure or some big conspiracy. Socialism and communism will fail every time they're tried until you can solve the "greed" of the people in the program. People are inherently greedy and a method of gov't that denies that fact will fail every time.

[Stereodude]

Any type of government will do this with any power they are given.Isn't that the saying by Lord Acton? "Power tends to corrupt; absolute power corrupts absolutely".

Yet people like Mercutio and Sechs think we should give more power to the gov't because they'll be more responsible with it than "evil" corporations.

[Stereodude]

or the power that HMOs have over medical care in the US)First of all gov't involvement in the health care industry it what has "ruined" it. The health care industry is one of the most regulated industries in the US, yet costs keep going up. So the solution must be to regulate it more? I don't think so. The solution is to unregulate it and allow free market competition to work. The gov't of each state has a list of minimum services that all insurance providers in that state much provide. There are all sorts of crazy things they force insurance providers to cover. And, as a result the cost is high. Get rid of all the mandatory coverage and let people pick the level of coverage they want and there will be cheaper plans with bare bones coverage, and there will be expensive plans with extensive coverage. Let people decide what kind they want independent of what their employer currently offers and you'll see the cost of health care plummet. Make it a bit more like car insurance and people will shop around for their health care to make sure they're getting the best deal. Insurance providers will compete to make their plans more attractive to to consumers.

You can complain about the HMOs and their power, but ultimately the gov't gave the HMO its "power" by passing laws and restricting the market. A complete gov't take over of 1/5th of the US economy isn't the answer.

[jtr1962]

What percentage of the upcoming $145B relief package is pork? Who knows? They will pass it so fast that no one will have a chance. This administration is running up a massive deficit and cutting taxes at the same time! The idiot masses are loving it. The same idiot masses, I might add, who run up their credit card bills without noticing or sign mortgages they could never afford! Meanwhile, the next administration will be forced to raise taxes and cut programs. But it really isn't them that did it, their hand was forced, like being the last guy from your group at the bar holding the tab.

I almost went ballastic when I read about the "relief" package. Why should people who lived within their means bail out idiots who used every dime of equity in their homes to buy big-screen TVs, vacations, pools, game consoles, and other mostly unnecessary consumer crap that they couldn't afford? I say let these people face the consequences of their actions or they'll never learn to be responsible. While as I said earlier I feel government should level the playing field a bit by providing education and some public transportation, it has no business at all insulating people from the consequences of bad decisions. What makes this all the worse is that this aid pacakge is coming from a Republican. More and more I'm seeing less fundamental difference between both parties.

[jtr1962]

First of all gov't involvement in the health care industry it what has "ruined" it. The health care industry is one of the most regulated industries in the US, yet costs keep going up. So the solution must be to regulate it more? I don't think so. The solution is to unregulate it and allow free market competition to work. The gov't of each state has a list of minimum services that all insurance providers in that state much provide. There are all sorts of crazy things they force insurance providers to cover. And, as a result the cost is high. Get rid of all the mandatory coverage and let people pick the level of coverage they want and there will be cheaper plans with bare bones coverage, and there will be expensive plans with extensive coverage. Let people decide what kind they want independent of what their employer currently offers and you'll see the cost of health care plummet. Make it a bit more like car insurance and people will shop around for their health care to make sure they're getting the best deal. Insurance providers will compete to make their plans more attractive to to consumers.

You can complain about the HMOs and their power, but ultimately the gov't gave the HMO its "power" by passing laws and restricting the market. A complete gov't take over of 1/5th of the US economy isn't the answer.
The concept of health insurance is really what ruined the medical industry. We should go back to the user pays model which once existed. Once we do, medical costs will drop dramatically. Right now hospitals can pad their bills and the patient won't care since they're not paying. Try that if they're paying out of pocket. I guarantee there will be no more $10 aspirins added to the bill, or expensive but medically unnecessary tests which the doctors perform just to cover their asses from law suits. In fact, get the lawyers out of medicine also and the costs will come down further.

Insurance is a bad idea on many levels. That includes auto insurance especially as it makes good drivers pay for poor ones. The only kind of medical insurance which makes any sense is catastrophic coverage for things like cancer or major accidents. Anything else can be paid out of pocket. This would give people an incentive to lead healthier lifestyles. If they did, most people would live to their 90s or 100s without requiring major medical care, and then go quickly once their body finally gave out. Now you have too many people in their 60s and 70s lingering in nursing homes for decades. Poor lifestyle choices got them into the nursing homes to start with.

[mubs]

The coming financial collapse of the U.S. government: Fed papers reveal what's in store for Americans (http://www.newstarget.com/z019659.html)

I suggest y'all read this, and if possible the link to the Fed papers. Personally, this is nothing new to me; this was a major factor in my decision to move out of the U.S. in 2006 after having lived there for 22+ years. I contributed to SS all those years, but will surely never see a dime of it. China will also get hurt badly since the U.S. is their largest trading partner. But at least they are doing something about that; we are on the threshold of China displacing the U.S. as India's largest trading partner. These two countries were baring their teeth at each other a few years ago.

For the advocates of a sales tax replacing income tax, that is what the prof. (author of the Fed papers) suggests!

[mubs]

A similar article: The Fraud of Bushenomics: They’re Looting the Country (http://www.alternet.org/workplace/74262/?page=entire)

At least some people are beginning to notice and are writing about what's wrong.

[Mercutio]

First of all gov't involvement in the health care industry it what has "ruined" it.

No. Wrong. Completely. We practice medicine for profit. Medicine. The necessary practice of preventing or curing physical and mental ailments. A necessity for human well-being.

In terms of its social role, availability of heath care occupies roughly the same place as having functional law enforcement, sanitation, public education or emergency services. To put it bluntly, when we don't have those things we might as well not even live together as a community.

About 1/3 of Americans has been priced out of having health care. That is an indicator that something is broken about the way we live.

Has this happened to anyone else? You doctor writes you a prescription for a name-brand still-under-patent drug. You go to get it filled and find out that 20 pills costs approximately your entire weekly salary. You decide to live in pain instead.

And, OK, doctors and nurses and therapists and pharmacists need to make a living and I understand that. But that's not who gets the money, not really. The money goes to layer upon layer of bureaucrats whose job it is to say "no" to essentially anything but the most basic care. The money goes to advertising agencies whose job it is to convince you that you need a pill for your restless leg. The money goes to pharmaceutical reps and to lobbyists. I'm not suggesting that we tell health care workers to kiss off and accept a government-mandated salary of $40,000 a year. I'm suggesting that may we should ditch HMOs and PPOs (note to Stereodude: These are not parts of the government); they clearly do not serve their intended purpose, which was, once upon a time, to reduce the overall cost of health care.

[Mercutio]

Yet people like Mercutio and Sechs think we should give more power to the gov't because they'll be more responsible with it than "evil" corporations.

Absolutely. Corporations are amoral beings that have all the rights of an actual human being in our legal system yet serve no other purpose to enrich the tiny number of people who own enough shares to see meaningful profit in corporate activities.

Corporations can act outside the best interests and welfare of literally everyone else on Earth if that action serves the interests of those shareholders. That's why we get Steel mills arguing that they need to pollute the communities where their employees live more, since that would cost less money and therefore increase shareholder profits.

That is exactly what I mean by "the possibility that certain individuals with no responsibility for anyone else might gain so much power over others that they could act or not act with the force of law." De facto, that is exactly what happens with un- or under-regulated corporate activity.

[Mercutio]

Socialism and communism will fail every time they're tried until you can solve the "greed" of the people in the program. People are inherently greedy and a method of gov't that denies that fact will fail every time.

Thank you for that brilliant analysis. How do you then explain functional social welfare programs in places like Sweden or France?

[ddrueding]

Everything in society is practiced for profit. Everyone in society wants to profit from their labors. That is why we labor. Saying people shouldn't profit from medicine is crazy. Saying who should profit is the key. Right now the money goes to insurance bureaucracies and lawyers. How do we get them out of the system? How do we make sure that the money we pay goes to those who treat us? By getting rid of the bureaucracy. There are two ways to do this:

1. Make all healthcare govt. run and completely free for everyone always. No paperwork, no exemptions, just free. If the rules are the same for everyone, all the people that make money gaming the system are eliminated. Downside: System is flooded with calls, people are treated for minor crap, taxes go way up.

2. Eliminate all mandatory/subsidized/govt. funded healthcare. Make a doctor's visit a transaction between you and them. This causes competition and allows everyone to negotiate for their own deal. Downside? People too dumb to plan for contingencies might die.

I'll take either, but this middle of the road BS is just sapping money to the politicians and bureaucrats.

[ddrueding]

(Paraphrasing Merc)

Government is an amoral being that has more rights than an actual human being in our legal system and serve no other purpose than to enrich the tiny number of people who are in a position of power.

Government can act outside the best interests and welfare of the majority of their constituents if that action serves the interests of those close to the government. That's who gives Steel mills permission to pollute the communities where their employees live more, since it gives more profit to those in power.

Why is a company worse? At least you can sue a company...

[Mercutio]

No. Wrong. Again.
We elect people who represent us and who - if they take their dicks out of lobbyists' mouths long enough - can change the rules to suit the will of the people.

A government that does not serve its citizens is not going to be in power very long. A corporation that does not serve its employees/manager/local communities can continue to do whatever the fuck it wants for as long as it makes shareholders happy.

Also, you can sue the government. It happens all the time.

[ddrueding]

That is far too idealist, Merc. It's a lovely idea and all, and if it worked like that consistently, I would be all for it. But it just doesn't.

Things that would help?

1. Transparency
2. Limited terms in any public office - eliminate the "career politician"
3. Limit governments power

[Stereodude]

Thank you for that brilliant analysis. How do you then explain functional social welfare programs in places like Sweden or France?Yeah, and the French economy is just booming! I'm sure those riots were really just celebrations of the functional social welfare program.

[Stereodude]

No. Wrong. Completely. We practice medicine for profit. Medicine. The necessary practice of preventing or curing physical and mental ailments. A necessity for human well-being.Everything is done for profit. You fix computers for profit. So what? You don't see me trying to tell you how much you can charge for your services.

Has this happened to anyone else? You doctor writes you a prescription for a name-brand still-under-patent drug. You go to get it filled and find out that 20 pills costs approximately your entire weekly salary. You decide to live in pain instead.You want drug companies to develop new drugs, you have to give them a financial motive. They aren't going to develop new drugs out of a sense of responsibility to society.

[Bozo]

You want drug companies to develop new drugs, you have to give them a financial motive. They aren't going to develop new drugs out of a sense of responsibility to society.

Odd, these same drugs are sold in other countries at a third the price.
Odd, when the patent runs out, the drug companies change the color of the tablet, call it improved, and the patent is extended. Gouge the consumer some more.
Odd, it cost $0.002 to manufacture a pill, but the drug companies charge $40.00 per pill. Just so the CEO gets his big bonus.

Drug companies are no better than the oil companies.

BTW, did you notice that Ms Clinton got some HUGE campain funds from Big Oil and Big Drug?

Bozo :joker:

[ddrueding]

Odd, these same drugs are sold in other countries at a third the price.
Odd, when the patent runs out, the drug companies change the color of the tablet, call it improved, and the patent is extended. Gouge the consumer some more.
Odd, it cost $0.002 to manufacture a pill, but the drug companies charge $40.00 per pill. Just so the CEO gets his big bonus.

The fact that they squeeze more money from those that have more money makes sense to me. If they averaged the price to something like $1 per pill, how many in third world countries would not be able to buy?

The fact that our patent system sucks doesn't mean that a company shouldn't do what it can within the law to make more money. If they didn't, they would be out of the business in a hurry.

I don't know how much R&D is involved with a drug, but I would be interested. Also of interest is how many projects receive funding for years and never show a marketable product. I suspect these represent some of the cost that doesn't make it to the CEO's paycheck.


Drug companies are no better than the oil companies.

BTW, did you notice that Ms Clinton got some HUGE campain funds from Big Oil and Big Drug?

Correct. No better. Why would they be?

Clinton definatly represents the same corrupt bureaucracy, and will favor those in Washington with power. Therefore she will win. Nothing ever changes.

[Mercutio]

For what it's worth, American drug companies spend about $30,000,000,000 a year on R&D, and about $90,000,000,000 on marketing... if that tells you anything about their priorities.

[ddrueding]

...and what does that tell you about the American consumer? That is the fundamental problem that needs to be fixed. We need a smarter population.

[sechs]

Just cause we have the best system doesn't mean it couldn't be better. To assume that just because we have the best system, that it can't be any better is foolish.
I guess that makes you foolish?

[sechs]

You're out to lunch...

The gov't's job is to stay out of the way of its citizens and empower them, not run and control their lives. I don't have to be able come up with a comprehensive list of what gov't should do. I don't have one already thought up. That's not the way I think. The gov't isn't my god. I don't worship at the altar of big gov't. I could get up in the morning and survive if the gov't was shut down.
The personal attack aside, that's just a bunch of baloney. You're avoiding the question at the core of this debate. In fact, you're actively attempting to avoid the question.

I dismiss, out of hand, any furthur attempted arguments on this subject from you. "The way that you think" is obviously nonsense, and there's nothing that you can make from that.

[sechs]

We need a smarter population.
Isn't that something we need government to do? We need more government!

[jtr1962]

Everything is done for profit. You fix computers for profit. So what? You don't see me trying to tell you how much you can charge for your services.

I think what Merc is trying to say is that the medical sector should be run as a non-profit entity. Sure, the doctors and everyone else will continue to be paid a fair, market rate salary for what they do, same as today. What would be different is you won't have shareholders and rich CEOs to pay "profits" to. Neither of these does a thing to increase the quality of medical care, but they increase the cost. Same thing with the malpractice lawyers.

I'll also add that it seems everyone here is under the collective illusion that modern medicine, and access to all sorts of drugs, actually makes us healthier. Truth is most of the drugs have long term consequences worst than what they're curing. I'm almost 100% sure Lipitor played a bit part in killing my father. He didn't even need to take it if he would have eaten a better diet. In fact, he wouldn't have had his first heart attack in 1989, nor the second one which killed him in 2006, had he led a healthier lifestyle. We need to change the so-called poison lifestyle first before we worry about anything else. That one thing, even if we still have millions with no access to doctors, will enable us to live longer, healthier lives. Until we do that, our current medical system will spend ever increasing amounts of money saving people from themselves. I personally haven't been to a physician since 1980. I don't plan to go to one either unless I need stitches, or to set a broken bone, or anything else I can't do myself. In the meantime I know my body, what to do and not to do, so I can maintain some modicum of reasonable health at least until my body wears out and I'm well into my 90s. Maybe by then I'll need a hip replacement or some other joint repair. Really, that's the only thing modern medicine has had good success with-repairing people's joints as they wear out. Treating anything else is pointless. Heart disease is 100% preventable. So are most cancers. Even when they're not, the current cure rates are abysmal. Everyone I know who has had chemo or radiation therapy died anyway within 5 years. With results like that why even bother? Actually, I know why. Cancer treatment is big money. My guess is even if a cure existed it would sit on the shelves forever. That's really the problem. There's no incentive to get people to change lifestyles when big money is made letting them slowly kill themselves via poor lifestyle chocies, but keeping them alive a little longer. It speaks volumes about the mindset regarding preventive medicine when you see a bunch of nurses puffing away outside during a break.

[Mercutio]

...and what does that tell you about the American consumer? That is the fundamental problem that needs to be fixed. We need a smarter population.

I don't think that it's an issue of the average person not being smart enough. Most people know they don't need a pill for "restless leg syndrome." I think it's indicative of corporate culture and priorities, and of a need to change the rules under which drug companies are governed. Everyone who is reading this thread can remember a time when it was not legal to advertise prescription medication in the US.

[Mercutio]

I think what Merc is trying to say is that the medical sector should be run as a non-profit entity.

Yes. That is exactly what I'd like to see. Saving people's lives - or even saving them from mild discomfort - isn't something that needs to be mixed with a profit motive. Think about how hilarious life would be if you had to wave $100 bills in the air to get someone to come put out your house fire.

[Mercutio]

You want drug companies to develop new drugs, you have to give them a financial motive. They aren't going to develop new drugs out of a sense of responsibility to society.

They already get patented drugs that they're allowed to reap vast, vast profits on for 14 years. Do you think that sum of money somehow insufficient? Do you think that 14 years is not long enough for a real-live breakthrough drug to net billions of dollars in return?

We certainly could put a cap on the price of a drug. Say, the amount of money that a cycle of treatments costs the Veteran's Administration. It's not like the drug company is going to fail to make money on that transaction; it's just not the anal rape price that the poor uninsured or underinsured bastard has to pay at the local Walgreens.

[Mercutio]

Yeah, and the French economy is just booming! I'm sure those riots were really just celebrations of the functional social welfare program.

That the French have issues with integrating immigrants into the culture that its native residents are taught to treasure really is not part of its social welfare programs. The programs themselves appear to be working well.

[Howell]

Try living on $940.00 A MONTH, then have $20-$30 more lost to the so-called "fair" tax.

Granted those living on a fixed income are very vulnerable the prebate should make up for the difference.

http://en.wikipedia.org/wiki/FairTax#Underground_economy

BTW, I don't like the term "fair"tax. It reeks of marketing.

[Stereodude]

That the French have issues with integrating immigrants into the culture that its native residents are taught to treasure really is not part of its social welfare programs. The programs themselves appear to be working well.The super high unemployment over there might have something to do with it too.

[Stereodude]

BTW, I don't like the term "fair"tax. It reeks of marketing.Not to mention it's still not fair. Truly fair would be everyone paying the same dollar amount just like they do for everything else in the world.

[Mercutio]

The super high unemployment over there might have something to do with it too.

A lot of the unemployment issues have to do with their immigrants as well. France offers citizenship to residents of its former colonies (eg Algeria), who come for the promise of a better life, but find out that France doesn't have work for them. The end result of that is a bunch of pissed off immigrants.

I've always admired the willingness of the French to take to the streets and protest, and to tolerate protesters. Completely off the subject, but I heard an interview with some Parisian commuters a few weeks ago regarding a rail workers' strike. These were people who had to commute across one of the biggest cities on Earth by bicycle or on foot, and they were talking about how the rail workers had every right to inconvenience them by striking. That's very admirable, and quite unlike the "every man for himself" opinions that so many people in this thread seem to have.

[Mercutio]

Truly fair would be everyone paying the same dollar amount just like they do for everything else in the world.

That's not fair either. That's the opposite of fair, since it would put the highest burden on those least able to pay.

[Stereodude]

That's not fair either. That's the opposite of fair, since it would put the highest burden on those least able to pay.Well then I guess the grocery store isn't fair. Best Buy's not fair. McDonalds isn't fair. Not a single retail or commercial establishment in the country is fair if that's your criteria.

[Mercutio]

Not a single retail or commercial establishment in the country is fair if that's your criteria.

So people who for whatever reason are wealthy should not have to contribute in any greater amount to the well being of their country than those who live in trailer parks and eat ramen noodles five nights a week, and that's what "fair" is?

'Cause I would say that's unbelievably, moronically selfish.

[Stereodude]

So people who for whatever reason are wealthy should not have to contribute in any greater amount to the well being of their country than those who live in trailer parks and eat ramen noodles five nights a week, and that's what "fair" is?

'Cause I would say that's unbelievably, moronically selfish.First of all let get something straight it's not a contribution. It's a tax. Taxes are not contributions. I contribute to charity. I don't contribute to the federal government. The Federal gov't takes my money.

I also never said that charging everyone the same amount of money was practical or realistic. However, it would be "fair".

You want the rich to pay more, great. Charge everyone the same percentage (aka flat tax). But wait, no, that's still not good enough for you. The rich still aren't paying enough money. They need to pay a higher percentage than everyone else. And, they currently do, but that's still not good enough. They still need to pay more. At what point will they pay enough? When you take all the money they make over a certain amount will they then pay enough?

This whole class envy / warfare thing is completely absurd and has gotten completely out of hand. Does screwing the rich on their taxes make your life better? Does it make you feel better? Does making someone else miserable change your situation? The US affords anyone the opportunity to become rich. We don't have a caste system. I'm not for soaking the rich with taxes because one day I hope to be rich, and I don't want to be soaked with taxes when I'm rich.

[Bozo]

I beleive the fairest tax would be a flat tax.
No tax for anybody on the first $25000. (Ajusted annually by the inflation rate). After that, every one pays 10% of their income. No deductions at all. A flat 10% for everybody.

Bozo :joker:

[ddrueding]

So people who for whatever reason are wealthy should not have to contribute in any greater amount to the well being of their country than those who live in trailer parks and eat ramen noodles five nights a week, and that's what "fair" is?

'Cause I would say that's unbelievably, moronically selfish.

It is fair. But long ago we decided that instead of just being fair, that taxes would take on a "Robin Hood" role of wealth distribution. It is (a bit) better for the society as a whole. But don't say that the wealthy paying more is fair. It's a good idea, but it isn't fair.

[ddrueding]

I beleive the fairest tax would be a flat tax.
No tax for anybody on the first $25000. (Ajusted annually by the inflation rate). After that, every one pays 10% of their income. No deductions at all. A flat 10% for everybody.

I'll stand behind that.

[timwhit]

I beleive the fairest tax would be a flat tax.
No tax for anybody on the first $25000. (Ajusted annually by the inflation rate). After that, every one pays 10% of their income. No deductions at all. A flat 10% for everybody.

Bozo :joker:

I'm not sure that this would generate the revenue necessary for the government to continue operating.

[ddrueding]

I'm not sure that this would generate the revenue necessary for the government to continue operating.

20%? Any guesses on what it would take?

[Stereodude]

I beleive the fairest tax would be a flat tax.
No tax for anybody on the first $25000. (Ajusted annually by the inflation rate). After that, every one pays 10% of their income. No deductions at all. A flat 10% for everybody.

Bozo :joker:I agree, that would be the fairest tax that you would get people to sign up to. Unfortunately it will never happen because:

1) It will put the IRS out of business, and we know gov't never gets smaller.

2) It would put tax lawyers and all the tax services companies out of business, so they'll fight it tooth and nail.

3) A lot of people are too stupid to get past the fact they're not getting any deductions.

4) A flat tax doesn't redistribute wealth and some people will have a problems with this.

[Stereodude]

It is fair. But long ago we decided that instead of just being fair, that taxes would take on a "Robin Hood" role of wealth distribution.It's the tyranny of the majority. Rich people are a minority, so they are an easy target of the majority to go after. The politicians of course play this card over and over and over.

[Bozo]

I'm not sure that this would generate the revenue necessary for the government to continue operating.

I think it would. Remember, no deductions. For me, after subtracting the first $25000.00, I end up paying close to the same. But, even the people that 'work the system' would have to pay. ( I know a person that makes 3 times what I do, and pays about the same as I do with the present system.)

Bozo :joker:

[ddrueding]

4) A flat tax doesn't redistribute wealth and some people will have a problems with this.

It does, just to a lesser degree. Someone who makes $1M/yr doesn't use the roads, police, or schools 20x more than someone who makes $50k/yr. In fact, even though they pay for public schools, it's likely that they would pay for private schools as well.

[Fushigi]

Well, some agency will still be needed to collect the funds so the IRS wouldn't go away. It and the rest of the associated tax industry (lawyers, accountants, etc.) would see job losses but would not go away. Expect lots of people to try to redefine "income" for their convenience.

I'd add:

5) Charities won't fare well under any system that doesn't include tax breaks for donations.

6) How are capital gains taxed? If the same then don't expect people to ever move up in home ownership as the tax penalty when selling would be hard to overcome. And if you provide an exclusion for this, then what's the next exclusion you provide? Eventually you have the current system all over again.

[Bozo]

Let me rephrase: earned income. For the individual taxpayer. Not on capital gains, not on interest, not on 401Ks, just earned income.

We had this in our state for a long time. Then the Democrates got into office and Fxxked all up.

Bozo :joker:

[Stereodude]

5) Charities won't fare well under any system that doesn't include tax breaks for donations.Personally, I don't buy this. I find it really hard to believe that people donate money to charity, church, or other non profit organizations because they're going to get a tax deduction.

And, ultimately if you let people keep more of their money they will be more generous with it.

[Stereodude]

The fastest way to tax reform is to eliminate automated employer deductions from paychecks. Give people their full pay check and have them get a bill from the gov't each month that they have to pay along with their mortgage, cell phone, cable, credit cards, etc. You'd have tax reform so fast it'd make your head spin.

[Howell]

20%? Any guesses on what it would take?

38%

[Howell]

I find it really hard to believe that people donate money to charity, church, or other non profit organizations because they're going to get a tax deduction.

Charitable giving always spikes in December.

[Stereodude]

38%Uhh.... How did you arrive at that number?

[Howell]

Everyone knows 38% is the correct percentage of pre-tax income to give to society and charity.

[ddrueding]

Everyone knows 38% is the correct percentage of pre-tax income to give to society and charity.

OK...who was the first everyone?

[Howell]

I guess this is the wrong board to be silly on. Reading mental masturbation makes me silly.

[ddrueding]

Sorry. I'm cool with silly, but it seems out of character, so I missed it.

[jtr1962]

It is fair. But long ago we decided that instead of just being fair, that taxes would take on a "Robin Hood" role of wealth distribution. It is (a bit) better for the society as a whole. But don't say that the wealthy paying more is fair. It's a good idea, but it isn't fair.
Actually, having everyone pay the same is patently as unfair as a lot of the other schemes. Even without getting into the ability to pay, a lot of people will be paying for services they simply will never use. From a strictly fair standpoint, the best system is one where the user pays for whatever they use. That means paying full tuition for school if you have kids, paying the police if they come to your house for a domestic quarrel, paying the full cost of gasoline and roads if you drive (including the cost of any wars in Middle Eastern nations to secure gasoline supplies), paying for all your food and housing. Obviously this system is unworkable but it would be fair in every sense.

I'm not for direct income redistribution, but government providing some basic necessities to level the playing field to give those in the lower classes a fair shot at bettering themselves isn't a bad thing. By basic necessities I mean transportation to get to work or school, education at least through high school, perhaps subsized housing or food if the market prices for these things in a area are not affordable. It can also mean a program to connect job seekers with employers. The poor can better their lot with a decent job, but the simple fact is that many jobs aren't advertised, and many (most?) people really are incapable of finding a job best suited to their talents on their own. Most just blunder into whatever they happen to be doing by chance. Another good feature of a job registry is that it connects jobs to local talent. No sense for someone to travel 20 miles to be a cashier when a similar job might exist 3 blocks away. What my idea on help doesn't mean is just giving the poor direct cash handouts so they can buy big screen TVs or Cadillacs or drugs or alcohol. In a nutshell, I believe in the old adage "Give a man a fish and you feed him for a day, teach him to fish and you feed him for a lifetime."

[jtr1962]

Let me rephrase: earned income. For the individual taxpayer. Not on capital gains, not on interest, not on 401Ks, just earned income.

We had this in our state for a long time. Then the Democrates got into office and Fxxked all up.

I agree that taxing interest and capital gains is patently stupid if think about it for a while. If you get 3% on your savings account but the prevailing inflation rate is 5%, then you already lost 2% before you pay any taxes. Now if you have to pay perhaps a marginal rate of 33% on your interest you lower the effective interest rate to 2%, and now you're 3% behind inflation instead of 2%.

If you really want to tax interest and capital gains fairly, then what you need to do is tax only the earnings in excess of the rate of inflation. And I'll go one better. If your interest is less than the rate of inflation, then your net losses should be used to offset some of your other income. Yes, you heard that correctly. If you have a $1 million savings account earning 3%, and the inflation rate is 5%, then you get to subtract $20,000 from your other income since this is your real net loss.

Besides being fairer, this also gives government an incentive to keep inflation down by not printing up money. Everyone seems to think that inflation is a normal part of any economy. Baloney. You can have stable prices for centuries given the right economic policies. It makes long range planning a lot easier knowing that house you want to save and buy in ten years will be the same price it is now.

[mubs]

I guess this is the wrong board to be silly on. Reading mental masturbation makes me silly.

:rotfl:

[Fushigi]

jtr, would you then tax regular income minus inflation?

What makes interest & capital gains different from pay for a regular job? They're all income. I fail to see why or how the source of income matters.

The argument that capital gains are generally re-invested is again a false argument. If the gains were taxed the government budget would be satisfied from more sources and the overall tax rate would be lowered. This happened here locally; during the housing boom enough new homes were built that the local county budgets were being spread among more and more people/sources so the amount per household needed to satisfy the budgets was lessened. My property tax rate went down. I'd also mention that there are no controls that say the capital gains would be re-invested domestically.

As to paying for services you never use, how do you know you won't use them in the future? Or that you don't benefit indirectly? For instance, we all benefit from an educated society so supporting public education is reasonable (not getting into an argument about the quality of said education). One could even argue that given the competition on the world stage we should more fully fund education beyond high school.

A transportation infrastructure is necessary as well. Partly for moving of food which you'd argue should be grown locally if possible and I generally agree, but some food won't grow locally or the quality is not good. And some products will never be available locally or will simply never be cost effective to produce in small (localized) quantity. So a national transport infrastructure (potentially with international ports) is necessary even if you are never a passenger in a car/bus/non-local train/plane.

A pay-as-you-use system could works for some things but not for others. For instance, that roadway transport system is more or less a pay-per-use system. In some cases directly via toll roads, in all cases indirectly via fuel taxes. So there's an integrated use tax for you. Based on how well our roads are being maintained, it doesn't work that well.

Honestly, I really don't think there are any easy answers. I'm pretty positive there's no fair way to treat people equally and to spread the burdens of our economy evenly. None of the proposed simple tax systems work because they are too simple. They fail to account for the complexities of the overall US, let alone world, economy. Everyone harps about how voluminous the tax code it. I say so frickin' what. We have computers and accountants to manage the process. The tax code should be revised - things like AMT need to be re-examined - but the problem isn't in a tiered tax structure with deductions. The problem is really managing how that money is spent and getting value for the tax dollar.

[jtr1962]

jtr, would you then tax regular income minus inflation?

No, the income tax was a bad idea from day one which is why it was purposely made illegal under the original US Constitution. I could probably write pages on why the income tax has caused a myriad of problems since it was enacted, but you can just as easily probably dig up the information on your own.



What makes interest & capital gains different from pay for a regular job? They're all income. I fail to see why or how the source of income matters.

Assuming we tax income, which as I said is a horrible idea on many levels, interest and capital gains are different for one reason-the initial invested principal was already taxed. Since it was already taxed, the only gain subject to further taxation should be gains above the prevailing inflation rate. That's the only real source of income. The rest is eaten up by inflation. Sure, this adds another layer of complexity, but it's certainly feasible to do it this way if we wanted to.



The argument that capital gains are generally re-invested is again a false argument. If the gains were taxed the government budget would be satisfied from more sources and the overall tax rate would be lowered. This happened here locally; during the housing boom enough new homes were built that the local county budgets were being spread among more and more people/sources so the amount per household needed to satisfy the budgets was lessened. My property tax rate went down. I'd also mention that there are no controls that say the capital gains would be re-invested domestically.

Well, for what it's worth the housing gains during the boom which only existed in the minds of the media were well beyond the prevailing inflation rate, so even under my system there would have been a windfall.



One could even argue that given the competition on the world stage we should more fully fund education beyond high school.

Probably a good idea, but with the caveat that everyone stop going to college. Some people are better served with trade schools. Everyone and his brother going to college has diluted the value of a degree.



Everyone harps about how voluminous the tax code it. I say so frickin' what. We have computers and accountants to manage the process. The tax code should be revised - things like AMT need to be re-examined - but the problem isn't in a tiered tax structure with deductions. The problem is really managing how that money is spent and getting value for the tax dollar.
The problem is the complexity. Do you have any idea how much productivity is lost figuring out taxes or keeping records which otherwise would be unnecessary? That army of accountants could be put to work doing something more productive for society, like maybe figuring track profiles for new high-speed rail lines, or trajectories for spacecraft, or anything else involving detailed numerical calculations. Besides these direct hits on productivity, you also have the government using the tax code to manipulate behavoir. In short, they decide which behavoir gets favorable treatment, not free markets. The pols give lip service to the free market all while standing on the sidelines deciding what's best for us, or rather for their rich campaign contributors who send lobbyists to Washington. We have a simple consumption tax and all this behind the scenes stuff mostly vanishes.

We tried restructuring and simplifying our tax code how many times now? I think it was 26 when I finally stopped counting. Each time it comes back even worse than before. The AMT is just another example of a ticking time bomb hidden in the tax code. When it was passed, the lawmakers knew damned well that inflation would eventually push middle class families into AMT brackets. They could have indexed for inflation same as they index a lot of other things in the tax code if they wanted to. They wanted this to happen since it would be mean more money, and would occur long after their terms were up. I wonder how many more ticking time bombs are hidden in our tax code? The lawmakers are counting on most people not noticing them until its too late. One thing is for sure-no human being or even computer program is capable of agreeing how much tax many corporations owe due to the varied interpretations of the tax laws. And this is good for us how? I hate doing my taxes with a purple passion. I hate all the extra records I have to keep. All this for a lousy $5,000 to $10,000 a year. On such a miniscule income the government should leave me the fuck alone. Anybody who gets rid of the income tax gets my vote regardless of what else they stand for. That's how much I hate the whole process.

[Bozo]

Tax only earned income. Not capital gains or interest.
The standard deduction is adjusted every year for inflation.
Not taxing interest and capital gains encourages investing and savings. More money for businesses to grow. More money in banks to lend out.
Some people would try buying and selling homes to get around the income tax. Fine. If you sell more than one house a year, then it is earned income and you are taxed.
Why do want to make everything so complicated? Why do want to tax interest income on the savings of someone making $25000.00 a year or less?

Keep it Simple.

Bozo :joker:

[Fushigi]

Bozo, you say "keep it simple" but in the same post you add exceptions. As I said before no simple system will be satisfactory.

jtr, as to the invested principal already being taxed, so what. I have tax withheld from my income. When I spend my remainder, other people are paid and tax is withheld again. Wash, rinse, repeat. By not taxing all forms of income equally all you're doing is creating exceptions and complicating the tax code.

If you folks who want a simple system can't come up with one, how do you expect our elected officials to do so?

[Bozo]

Bozo, you say "keep it simple" but in the same post you add exceptions. As I said before no simple system will be satisfactory.
If you folks who want a simple system can't come up with one, how do you expect our elected officials to do so?

You are confusing definations with exceptions.
Earned income is: a paycheck from an employer, profit from selling more than one home in a callender year, profits fron selling stocks and bonds.etc,etc
What is not earned income: interest from savings accounts, interest from IRAs and 401Ks, social security income. etc etc

Clear as mud?

Bozo :joker: