Economy The 400 wealthiest Americans last year paid a lower total tax rate than any other income group

Discussion in 'The War Room' started by PolishHeadlock2, Oct 7, 2019.

  1. freakroor

    freakroor Purple Belt

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    they should have a sliding scale where the poorest person pays the lowest % of taxes, and the richest pays the highest. Seems like it's backwards right now.
     
  2. SammyPops

    SammyPops Gold Belt

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    The dynamic of race and ethnicity and wealth division does not take place in homogeneious counties so I cannot compare. I'm not sure whats so hard for you to understand about that.

    Such facts can identify systemic influences.

    Oh wait, unless you think its all individualism and the system doesn't affect anything?
     
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  3. panamaican

    panamaican Senior Moderator Staff Member Senior Moderator

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    If you charged everyone the same dollar amount, you'd be taxing poor people at a higher rate than rich people, which is obviously not fair. Let's say the tax is $5,000. So that's a 25% tax rate for the guy making $20k but a 1% tax rate for the guy making $500k. I can't see the fairness in taxing the poor at the greater rate.

    If you taxed everyone at the same percentage then you're taking more money from the rich even though the tax is supposed to be flat. At 5%, the $20k guy is paying $1k and the $500k guy is paying $25k. So, different tax burdens for the 2 people but that's not where it really becomes unfair.

    It becomes unfair because the person with $20k in earnings is seeing a more substantial decrease in their ability to live off their earnings than the other guys. If the minimum cost of living is $15k/yr then the guy making $20k is paying 20% of his discretionary income in taxes ($1k of his remaining $5k) while the guy making $500k is paying 5.2% of his discretionary income.

    You are again creating a more substantial tax burden on your poor.

    This is why we have progressive tax rates. The point of the rate ladder being to approximate the equivalent tax burden on life style across multiple earning groups. So that the person making $20k has the same functional tax hit as the person making $500k, even though they're paying different rates and ultimately different fiscal amounts.

    Short of eliminating income taxes completely and switching to high taxes on luxury goods and non-necessities, it's the most fair way to do things, even if people argue about the exact tax rates and income brackets.
     
  4. AgonyandIrony

    AgonyandIrony Gold Belt

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    Modern conservatives: MAGA doesn't mean go back to a time when minorities were considered inferior. It means the economic boom of the 50s.

    Modern patriots: okay lets go back to the tax rates then.

    Modern conservatives:
    [​IMG]
     
  5. THEfightsAREfixed

    THEfightsAREfixed Master Servant

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    I don't understand what your point is

    My point: wealth division and ruling classes receive the benefits of the collective labor and product of the large impoverished class and exist because the society is designed to move wealth upwards not downwards, the US is an example of this, and you can find it throughout history and across the world

    what is your point?
     
  6. SammyPops

    SammyPops Gold Belt

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    My point is that in the US and Canada, two immigrant and diverse nations , this division of wealth (see the OP) is most likely across race/ethnic lines.
     
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  7. MikeMcMann

    MikeMcMann Gold Belt

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    I think a Flat Tax on all forms of income with a phased in bottom end is the best solution.

    So lets say the Flat tax is set at 30% or whatever but applies to Interest Income, Capital Gains and Inheritances but below a certain income (poverty level) and up to a certain level (working poor) its basically phased in. But everyone pays that Flat tax on ALL income and those at the bottom get it rebated back.

    As soon as you start making the system complex that invariably benefits the super rich. This keeps it simple. No loopholes.

    I know people say its unfair for someone making $50k to pay 30% and someone making $1MM to pay 30%. We want the person making $1MM to pay 50% or more but it is fair. As the person making $50K is almost certainly going to only pay the 30% or $1500 once and consume the rest of the money on living expenses, whereas the person making $1MM and paying $300k the first time, will almost certainly be investing lots of it and then making secondary and third incomes off it and paying 30% over and over again. Which is fair as it is additional income and there should not be a discount for that.
     
  8. THEfightsAREfixed

    THEfightsAREfixed Master Servant

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    what do you think about the possibility of there being a correlation between wealth and majority racial groups and minority racial groups throughout history and cultures? Do you believe the wealth inequality observed in the majority racial group in the US versus other societies throughout history is statistically or stylistically different in a significant way?
     
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  9. tinker_190

    tinker_190 Brown Belt

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    I understand this, and it has been stated in various forms throughout this thread. However, this a crux assumption here, which is the intersection of impact of burden on fairness. By the logic given, charging any two people the same amount for anything is unfair because of disparate impact. In the name of fairness, should McDonald's have to see your pay stub to determine how much to charge you for a cheeseburger? That same logic would say they should. But going down that rabbit hole is ultimately going to determine that the impact of charging anything is more impactful on those with less, which isn't helpful or useful.
     
  10. panamaican

    panamaican Senior Moderator Staff Member Senior Moderator

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    Except that McDonald's cheeseburgers are not legally mandated by Congress nor are the fees collected and allocated for the public good.

    Which is where taxes lie and not random goods and services. Taxes are legally mandated, they are collected from the public to pay for the things that the public is then granted access to. The concept of fair is specifically impacted by the different duties between a for profit business and a government entity and the ability of the individual to opt in or opt out of the financial burden itself.

    You can opt out of cheeseburgers, so McDonald's has no duty to structure a price chart that manages the burden for individual buyers (they do this anyway but they have to duty to do so), the consumer can independently manage the burden themselves. You can't opt out of taxes, so the government bears all of the duty to structure a tax system that manages the burden to individual tax payers.

    Put in simpler terms, you can decide what you want off the McDonald's menu, taking your personal finances into account. You cannot decide how much in taxes you want to pay, taking your personal finances into account. The power dynamics in the relationship are completely different.
     
  11. Jack V Savage

    Jack V Savage Secretary of Keepin' It Real/Nicest Guy on Sherdog

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    I think what would be really ideal is no income tax (or maybe a small one on very high incomes to discourage them), and fund the gov't with taxes on land value, natural-resource use, estates, and costs that are passed on to the public (like pollution, congestion, etc.). From a fairness perspective, there would be no argument, and it would lead to better use of land and resources, less negative externalities, and more economic growth. I think that's kind of a pipe dream, but having it in mind can steer us in a better direction.
     
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  12. Crazy Diamond

    Crazy Diamond 2GM/c^2 belt

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    Lest you fear I've gone off the deep end, worry not, I'm just not at my best at the moment. I'm gonna blame that one being ill for the past couple of days. In particular, I missed the phrase "running their business" when talking about absentee parents.

    But one aspect of this exchange where I don't think we quite see eye to eye may be this: I don't think it's sinful per se to make lots of money, and to deliberately take steps to try to make more money. And I think there are a lot more people like that than you do, apparently. It's the love of money that is sinful, going after it for its own sake, or by proxy, for acquisition of property and other possessions, just to have as much as possible. There are lots of people here, for example, who are relatively wealthy, but only a few of them are on a relentless campaign to expand, absorb, and own as much as possible.

    Upon reflection, however, I am sure it's far more common among the very wealthy to love money whereas I am including the merely very well off.
     
  13. Crazy Diamond

    Crazy Diamond 2GM/c^2 belt

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    By the way, I think it's time I reminded the group of who the real expert is around here when it comes to this topic:
     
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  14. cincymma79

    cincymma79 Silver Belt

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    The effective tax rate is about the same
     
  15. Mark Hunts FIST

    Mark Hunts FIST Black Belt

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    Tax rates, meh...
    Would Someone rather have 30% of my $100 or 5% of my 10 million.

    *not saying the very rich should not pay more.
     
    Last edited: Oct 9, 2019
  16. JDragon

    JDragon DOX News Anchor Platinum Member

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    Because no one is paying them <seedat>
     
  17. MikeMcMann

    MikeMcMann Gold Belt

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    i like it.

    i actually started my prior email with NO income tax and just a flat tax based on consumption as I do think some variant of that makes more sense. But then I thought I would stick to something I think could actually be sold to the public that was not so radical or complex. I think my flat tax above is the easiest for the general public to understand and is a massive improvement over what exists today.
     
  18. ScottE

    ScottE Green Belt

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    It's not when you actually consider what the effective tax rates would be if the 1950s tax rates were in place today. Wealth concentration is significantly higher now then it was then. You'd had less reaching those highest tax brackets then you would if those brackets existed today (even adjusting for inflation).

    If you introduced the 1950s tax rates today the effective tax rate would be much higher then it was in the 1950s because there is more at the top end that would experience those high tax rates now then there was then.
     
  19. cincymma79

    cincymma79 Silver Belt

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    No
    No it wouldn’t
     
  20. panamaican

    panamaican Senior Moderator Staff Member Senior Moderator

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    Yeah, it would. The effective rate in 1950 was 42%.

    https://taxfoundation.org/taxes-on-the-rich-1950s-not-high/

    Per the chart in the OP, it's under 30% now. If we brought back the 1950's rates, we'd probably be looking at something close to 50% for anyone who doesn't live in a tax free state.
     
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