"The rich don't pay their fair share"
OK, what's their fair share exactly ?
Do the liberals who hold such views actually know that the top 1% pays >40% of the income tax bill while the bottom 50% pay <3% ?
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"The top 1%" doesn't mean anything. Increasing taxes hurts the middle and upper middle class, while the actual rich can just avoid taxation using offshore structures.
you don't even need to avoid taxation using offshore structures. Assuming your in the States, "the 1%" most are referring to have their wealth mostly tied up in shares and they have a preferential tax treatment when they borrow against it rather than selling it and getting taxed at Capital Gains rate.
In my humble but mostly uneducated view of governments, I would think that the need to increase taxes suggests that the government are overspending what they can afford to which they could refer it to as "Keynesian economics" or MMT or whichever way they like. To me, the fact is that the need for the increase in taxes suggests that the increase in expenditure is inorganic and unsustainable. I would think a prudent government should be one that should strive to maintain or even lower their taxes for the benefit of taxpayers
Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this:
So, that’s what they decided to do. The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve. “Since you are all such good customers”, he said, “I’m going to reduce the cost of your daily beer by $20”. Drinks for the ten now cost just $80.
The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free. But what about the other six men - the paying customers? How could they divide the $20 windfall so that everyone would get his “fair share?”
They realized that $20 divided by six is $3.33. But if they subtracted that from everybody’s share, then the fifth man and the sixth man would each end up being paid to drink his beer. So, the bar owner suggested that it would be fair to reduce each man’s bill by roughly the same amount, and he proceeded to work out the amounts each should pay.
And so:
Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare their savings. “I only got a dollar out of the $20,” declared the sixth man. He pointed to the tenth man, “but he got $10!” “Yeah, that’s right,” exclaimed the fifth man. “I only saved a dollar, too. It’s unfair that he got ten times more than I!” “That’s true!!” shouted the seventh man. “Why should he get $10 back when I got only two? The wealthy get all the breaks!” “Wait a minute,” yelled the first four men in unison. “We didn’t get anything at all. The system exploits the poor!” The nine men surrounded the tenth and beat him up.
The next night the tenth man didn’t show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. They didn’t have enough money between all of them for even half of the bill!
And that, boys and girls, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.
David R. Kamerschen, Ph.D.
Someone needs to illustrate this and put it in a book to give to kids.
I don't disagree with this, but the tax system is much much more complex than that. And the criticism that wealthy people get is the attitude of "What kind of lifestyle can you have with $500M that you couldn't with $200M? That $300M wouldn't change anything to your daily living but would tremendously help others!". And that is the crux of it. If you tax people earning over $500M (as an example) something like 70% they can still have an OBJECTIVELY good quality of life with the remaining millions. And not, this is not communism because you aren't taking 99.999999999% to the point where Jeff Bezos and Jeff Bozos are both eating potatoes on the side of the street. You are taking a good portion of money from people who wouldn't really need it to solve issues for those in desperate need. If you actually stop and think about it, it is very hard to spend $100M in a given year. Even $50M. The super wealthy know that so they just throw all that money into investments for it grow their personal wealth. I'm not saying it should be an all or nothing situation, but you should realize that even with the most luxurious lifestyle possible, as a billionaire (or close to it) you could be given a lot more money away for improved societal causes.
And might I ask who you would trust to make the decision regarding what that dollar amount should be?
Is a yearly income of $5M too much? What about 10, 50, 100, 500 million? What happens if you defy all odds and pick the theoretically perfect number but then the rest of the populace points at the "new 1%ers" and re-hashes the same argument?
That's the point though. Money is more efficiently used in private hands than in the hands of a government agency. I'd rather have billionaires investing their money into great companies than the government squandering it on a horribly run program.
Can you name one time the wealth has actually trickled down like that, in your fantasy scenario?
(Hint: it never, ever has. Trickle down is economic poison, it hasn't worked once. 50 years, 18 countries, and not one success. Second only to Marxism as worst economic idea in history)
https://www.washingtonpost.com/business/2020/12/23/tax-cuts-rich-trickl…
This is over grossly over simplified. You missing the forest for the trees.
a dollar bill is far more efficient in the hands of enterprise or an entrepreneur than it is in the government. People complain about Amazon and Apple not paying their 'fair share' of taxes.
In reality it's fantastic. Those companies have innovated and progressed technology, society, the world, etc. far more than the money being lost in some government agency
While Apple and Amazon make some great products, they are not paying teachers, cops, soldiers, firefighters, EMTs, and other people society relies on. In fact, without those people there would be chaos and Apple and Amazon may not exist.
I do agree that major corporations are more efficient at research than Uncle Sam, but there are many areas where it is not profitable, at least for many years, to conduct research and that's why we need the government to step in and fund those things. For example, the CS theory, math, and physics that have made Amazon and Apple possible.
So yes, they do contribute to our society, but they have to give back just like you or me, because they benefit from the government.
Yes, but not even close to the topic at hand. Everything you just listed out there are all paid for by local taxes: property tax, sales tax, state income taxes, or you poor shcmucks in NYC that even pay city income tax, sin taxes, local taxes applied to venue tickets to help repay the bonds sold to fund construction of the stadium, etc. Federal funds do contribute to some aspects of them, but the very basis for their existence is local taxes.
Those college courses you mentioned? Why do you think out of state tuition is always so much higher? Oh right, because local residents are already paying a portion of that tuition expense through property taxes and state sales taxes. Oh, and Apple is giving back to those universities too through grants and scholarships. But oh no! That counts as a charitable deduciton too so we can't tax those dollars now?! Oh the horror! That means they're wisely taking advantage of incentives to donate to their own benefit and it helps others along the way?!
The rich pay a lot. But most people are not concerned about income taxation, but rather the wealth inequality. The growing inequality in net worth exists, and primarily because capital has taken a front seat to actual labor. We have devalued capital from labor, by allowing the government to have a decade of unnaturally low interest rates to finance company and real estate acquisitions. Unfortunately, the larger the government deficit, the longer we will continue to have lower interest rates, and the larger this inequality will be.
The sad part is that people want the government to pay for everything, and while on face value this seems great, people will be sacrificing long term economic prosperity with short term, housing, food, UBI. There has been a system in the past where people trade their labor, and instead of pay are kept fed and housed. I don't see how this will differ from what will happen if we continue down on this road.
Wealth inequality being viewed as a problem is something that has never made any logical sense. Putting aside the fact that significant inequality exists in any environment w/ a modicum of freedom, it's not as though economics is a 0 sum game, which is the only premise under which the "problem" of wealth inequality makes sense. My personal income has skyrocketed in the 3+ years since I left college and has gone up significantly in the last year. At the same time, the gap between my wealth and that of the richest .01% on the planet has increased. Of course, the fact that ppl who are wealthier than me continue to get wealthier, at a faster rate, doesn't bother me at all because I'm getting wealthier, too.
At the end of the day, the "wealth inequality" is based solely on envy. If it wasn't, they'd be focused on how to help poor ppl better position themselves for success than on alienating rich ppl from their money.
Inequality itself isn't a problem.
The problem is the costs of healthcare, childcare, education, etc. are increasingly shifted towards working class people and it gets harder and harder to pay for those things every year. And some (not all) rich people throw money to defeat any kind of proposal that would alleviate these problems because they don't want to pay more in taxes.
I agree that ultimately it isn't evil in itself. The issue comes up when you have some actors with the ability to put their thumbs on the scales to alter the balance in their favor with mal-intent. So if you're the victim of someone doing that, it's easy to get tunnel vision thinking that they then owe you because you see it as they took from you to give to themselves. Meanwhile, we also have grifters who make it their entire purpose to fabricate and blow up accusations of inequality just so they themselves can profit from the ensuing bickering.
I disagree, also most everyone on this forum will be in the top 20% of income where they live by the time they are 30. So I believe we are looking it through a different lens, if we were going to use personal stories to justify the data. But again, we are not talking about income inequality but wealth inequality.
I do not favor the rich to be taxed anymore than they are. And a wealth tax is the worst idea in the history of bad ideas. Income should be taxed at 15% across the board, everyone needs to pay into the system to have a representation in the government. You start running into trouble when people who don't pay anything in tax start voting and telling our elected officials they they need to vote themselves money. Tocqueville said American Democracy is a great thing until the people realize they can vote themselves money. To own any means of production, you will likely be paying some tax, whether real estate tax or corporate tax, this means that everyone who owns a share of stock, a share of a REIT or a syndication in a multifamily building is paying the pro-rata tax of the vehicle to their ownership.
We drastically need to reduce the deficit, change how student loans are issued, and all at the same time put more money into education and policing.
Just because wealth inequality isn't viewed as an issue by you, someone who went to college and likely has a high earning job today, doesn't mean it isn't viewed as a probably by the majority of people.
I agree the discourse should be on helping poor people better position themselves for success. The education system in the US sucks, and higher education is extremely expensive. For most people it doesn't make economic sense to sacrifice to get good grades, go to college, etc. Instead they may be aiming to be a worker in an Amazon warehouse, where conditions are only getting worse, income is not rising, etc. Or that may be all they know due to their economic situation
Are you say that capital has taken the front seat over labor due to unaturally low interest rates? Wouldn't low rates make capital less scarce and reduce it's importance relatively to labor?
Thanks to Trump's tax cuts, the ultra-rich in America really do pay less than you or me, as a Berkeley study shows. This is why you never vote Republican, money that could be used for education, healthcare, infrastructure, is instead used to blow up the deficit to cut taxes. By the way: the individual tax cuts will go away but the corporate ones never will!
https://www.nytimes.com/interactive/2019/10/06/opinion/income-tax-rate-…
Do you ever have anything else to do? Like study for finals at Columbia or taking your Russian fiancé on dates. Like honestly.
He said in a previous post that being forced to wear a mask or social distance has not altered his life in any way.
That tells you all you need to know...
He can't take her out on dates. She's a mail-order bride who hasn't arrived yet, is likely being taken out by other dudes right now while Drumpfy denies it's happening
So you basically admit that the Democratic Party is flooded with corporate democrats, yet say that voting (D) will change things. I've also mentioned it before that there is a reason why top CEOs are almost all Democrat.
What I meant was that the tax cut bill has the individual tax cuts expiring in 2025 while the corporate ones are permanent. But yes, I do not deny the fact that there are corporate democrats. The difference is that Democrats may not have the ideal solutions to problems like climate change, COVID, healthcare, housing, education, etc. while the Republicans don't even acknowledge these issues.
"...Thanks to Trump's tax cuts, the ultra-rich in America really do pay less than you or me"
When people say this it is either naive or purposely misleading. So we're talking about cash taxes from a federal perspective right? This argument is so tired because wealthy people pay a lot of taxes no matter how you cut it and corporations that "don't pay any taxes" pay a lot of taxes as well. Think of the tax revenue corporations generate, even the ones who "don't pay any taxes" payroll tax, sales tax (end customer), property tax, state and local, etc etc...
The "corporations pay less taxes than us"....and the wealthy or whoever is currently being targeted is just wrong. It's a stupid moot point to only look at federal income tax for individuals or cash tax expense for corporations. Are you really stupid enough to think that you account for more overall tax revenue than Warren Buffet? If so, you are an idiot.
I don't know what it is with liberals thinking that paying the most taxes possible is some badge of honor. Let's total up what Buffet or choose any random billionaire generates in overall tax revenue annually and let's see who "doesn't pay taxes." A few expensive car purchases alone at 8% sales tax in NY is more than most of population of the US pays in FIT so give it a rest.
Are you really stupid enough not to understand why a centibillionaire should pay more in taxes than me? Warren's tax rate is 0.1%, even he thinks his taxes should go up. But you guys just keep boot licking.
I mean.. do you want to increase the tax burden on the poor, who are already broke as fuck?
Why must I carry Jeff Bezos's burden? Amazon benefits greatly from US infrastructure, US government, US military and police, and US education but they won't pay a single penny to support those things.
To be fair, sometimes they're broke through no fault of their own. and get stuck under the weight of all the debts and secondary effects of it. Such as an immediate family member dies and leaves all of their medical debt on you (I have a friend who's parents had to divorce on her father's deathbed just to avoid this very scenario. Let's be human for a moment, how messed up is that?!). Or someone frames you for a crime you didn't commit, and despite all the evidence you get convicted just for some judge/prosecutor to score points and now you're screwed with no chance of getting back into your profession despite all your colleagues vouching for you and good luck paying off all your legal bills now (also seen this one happen to a family friend).
For the question of who carries the burden, my personal belief is that if someone has the means and the motivation they will give of their own charity. Especially because then they can make sure their money/property/services go to the specific audience they want instead of some giant pot'o'money that spends 93% of all donations on "administrative costs" and barely anything makes it to the actual cause (*cough*SusanGKoman*cough*).
Are you stupid or are you just pretending to be?
Most of my income comes from carry which means my effective tax rate is much less than my analysts, traders, and supporting staff.
When people complain about the rich not paying their fair taxes, they aren't talking about their doctor or an athlete who's paying high rates on every dollar earned, they're talking about the ultra rich who's source of income does not come from a salary, and either gets taxed at a much lower rate or not at all.
Yeah right, when regular people complain about taxation they obviously think about the carried interest loophole which benefits PE partners and HF managers because common folks have such a fine understanding of high finance comps.
Dems are pitching a wealth tax aimed at great fortunes, and not +90% marginal tax rates.
Nationalize Facebook, breakup Amazon, and send Mark Zuckerberg to a prison camp to perform hard labor.
I'm down for breaking up Amazon. separate AWS from the warehouse to home delivery service. Guaranty that the delivery service would collapse overnight.
AWS and Prime are very different...I'd rather see Meta divest from Instagram.
But lick the glorious boots of the Koch brothers or Rupert Murdoch amirite?
The Koch brothers are open borders globalists and Rupert Murdoch is a Zionist, so...
The OP is just a troll...almost exclusively commenting in and creating threads of controversial topics. Pretty weird behavior.
You mad huh?
Debunking your bullshit as I did here https://www.wallstreetoasis.com/forums/diversity-0#comment-2649454 and I'm now categorized as a troll? Lmfao.
I'm not even mad...just calling a spade a spade.
"Do the liberals who hold such views actually know that the top 1% pays >40% of the income tax bill while the bottom 50% pay <3% ?"
Meaningless statistic unless accompanied by the % of aggregate income earned by the top 1% versus the bottom 50%. Then for double points define "income" in a satisfactory manner.
Setting all of this aside it does appear to be something of a loophole that you can take margin loan proceeds against appreciated stock without triggering any kind of tax charge, then step-up the basis when your kids inherit / family trusts take over.
One of my favorite clips of all time:
🍿
There was some study that people love the idea of raising taxes on others (their neighbors), but when asked to tax themselves they frowned on it. Pretty simple really... it's just human psychology. Some self preservation bullsht
Speaking on a perfunctory level, it’s quite intriguing to see knowledgeable (generally) folks on this forum engage in discourse about a legitimate topic. Most have valid arguments. But here’s the problem - you are the few. The many do not understand these concepts. They don’t understand government deficits, economic policy, market dynamics, and ineffectiveness/inefficiences of certain taxation structures. So we can bicker all we want but a good deal of voters are gonna elect some left-wing or progressive politician who promises them free entitlements that the we as a society can’t really afford to pay. I just hope to be in a position soon to be compensated in means other than cash to offset my liability and hire that good ole accountant to keep Uncle Sam away from my accounts.
You may have missed Drumpfy's posts.
https://www.washingtonpost.com/business/2020/12/23/tax-cuts-rich-trickl…
50 years of data over 18 countries shows the obvious: trickle down doesn't work. It's never worked. Ever. Conservatives are like communists, their economic plans fail over and over and over again "bUT tHIS tIME iT wILL fINALLY wORK!"
Your stat is just a “gotcha” stat, that probably works on general forums, but a finance forum where people earn a lot and know about taxes it won’t generate the drama you want.
When people make that statement they are referring to the uber wealthy like Romney who was able to bury his wealth in tax advantaged accounts on Buffet who can live on his capital gains loopholes or real estate families, which as we all know, have amazing tax treatment. You can do things like move real estate to your kids and then rent it from them, etc.
So the people really getting screwed are the w-2 employees making between 250k and 5 million.
A couple of folks have said it but bears repeating - the discourse has really gone in the direction of the uber wealthy - those worth >$100m+, not finance VPs, not doctors making $1m, or your typical partner at Deloitte. Look at the wealth inequality (and health) created during the pandemic. Frontline workers working minimum wage, worked to the bone, while the "owners" saw capital appreciation and exponential growth in wealth while sitting in their estates in Aspen. Minimum wage hasn't increased but prices of everything else has. Large companies like Amazon benefitting greatly from government systems in place, not only through taxes but just subsidies. The fact that there are employees at Amazon and Walmart who are on welfare programs means the government is subsidizing these companies and helping their appreciation - literally putting money in the pockets of large owners / shareholders
I had a discussion with a coworker of mine who lived through the tougher times.
The serious question is, is this all sustainable?
At what point can inflation keep increasing before things crack?
Feds said they will increase the rate three times in 2022, will this help stabilize the inflation increases?
I am in an insulated industry, but my power to purchase goes down as prices of goods goes up. I can't even afford a studio where I live at currently, as rent prices dramatically increased and the number of homeless keeps rising. I admit I am not as educated as the majority of people on here, but the effects of inflation and being taxed heavily is an essential burden. If the government increases the rate hikes, what will happen to the behavior of taxes?
Just had a random thought thanks to reading about Elon utterly bitchslapping Elizabeth Warren on twitter. Why can't we see a savvy congress member respond to Elon's tweet with something like "I'm thankful you pay your fair share. You help so many others by paying towards the gov't resources they need but couldn't afford on their own." Sure there'd be some butthurt people screaming that they're only encouraging the Elons to "avoid taxes" (while not understanding the distinction between avoiding taxes and criminally evading taxes), but it'd force a conversation to expose things like Elon's FIT payments are more than 26,000 times the entire median household gross income.
Why can't conservatives understand percentages? He pays 3.27% tax, while you pay 20-30%, even though he has 200 billion dollars. In what world is that a fair share? How does that boot leather taste?
The reason nobody said that is because nobody wants less taxes for the rich, not even the Republican core. That's why they have to LARP as populists to get elected.
I am assuming you are referring to the Study above where you are saying Elon pays 3.27% tax. This is false. Even in the study they admitt that he pays a about a 29-30% marginal tax rate on his income. the 3.27% is a entirely a fabricated statistic that has no bearing on how the tax code works.
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