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Lissa
01-03-2004, 10:56 AM
I see this all of the time on the boards.

For example, in this (http://boards.straightdope.com/sdmb/showthread.php?s=&threadid=232600) thread:

Originally posted by MFitz

Acedemia generally means liberal (Socialist, Communist, Progressive, whatever name they are presently hiding under).

I've seen many other examples of equating Liberalism with Communism, and it perplexes me a bit. I know quite a few Liberals, and none of them even remotely approach what I would consider to be a Communist viewpoint.

Is it just a convenient slur which has no bearing on reality? To me, such an epithet belongs to another era.

deadeyesdad
01-03-2004, 11:05 AM
Probably from where Conservatism=Fascism comes from. Mindless insults to make your point of view look better.

pervert
01-03-2004, 11:06 AM
It might help if you examine what you think the difference between a liberal and a communist is.

Odesio
01-03-2004, 11:10 AM
Originally posted by Lissa

I've seen many other examples of equating Liberalism with Communism, and it perplexes me a bit. I know quite a few Liberals, and none of them even remotely approach what I would consider to be a Communist viewpoint.

Is it just a convenient slur which has no bearing on reality? To me, such an epithet belongs to another era.

It is a convenient slur but it does have some bearing on reality. Since the 1920's it has been the radical left that has embraced Communism in the United States. Note that I say radical left. I don't believe most people who lean to the left are keen on Communism.

Marc

John Mace
01-03-2004, 11:11 AM
Originally posted by deadeyesdad
Probably from where Conservatism=Fascism comes from. Mindless insults to make your point of view look better.
Damn, foiled again!:)

Actually, communism and fascism have more in common on a fundamental philsophical level than do "conservatism" and "liberalism" in the American sense of those words. The first two are collectivist in nature, while the latter two at least pay lip service to the concept of individual freedom and responsibility.

Lissa
01-03-2004, 11:23 AM
One definition:

Communism:

n 1: a form of socialism that abolishes private ownership 2: a political theory favoring collectivism in a classless society

None of my Liberal friends advocate the abolishment of personal property-- far from it. In fact, they're happy Capitalists who, like most Americans, want to own a lot of stuff.

Second, most of my Liberal friends are college-educated, and anyone who's ever taken a Sociology course knows that a "classless society" is an utter impossibility. It goes against everything in human nature.

A second definition:

com·mu·nism
n.

A theoretical economic system characterized by the collective ownership of property and by the organization of labor for the common advantage of all members.
Communism

A system of government in which the state plans and controls the economy and a single, often authoritarian party holds power, claiming to make progress toward a higher social order in which all goods are equally shared by the people.

The Marxist-Leninist version of Communist doctrine that advocates the overthrow of capitalism by the revolution of the proletariat.

Again, I've never seen any of my friends advocating for any of the above. They support our Capatalist system, abhor the idea of a single party being in power, and have no interest in overthrowing the government.


lib·er·al
adj.

Not limited to or by established, traditional, orthodox, or authoritarian attitudes, views, or dogmas; free from bigotry.

Favoring proposals for reform, open to new ideas for progress, and tolerant of the ideas and behavior of others; broad-minded.

I somewhat agree with this definition of Liberalism: favoring reform, and not limited to the status quo. I have known a few Liberals who aren't necessarily all that tolerantt, but I think that the basic premis of Liberalism is to tolerate other's religious, moral and political views. I've never considered Liberalism to be advocates of censorship, or of resrticting freedom.


These are just my opinion, and a few definitions from Dictionary.com. Some Liberals may dissagree.

jshore
01-03-2004, 12:53 PM
Lissa: Well, many would argue, with justification that the definition of liberalism you have there is not completely in line with how it is used in modern political discourse. In particular, in the economic realm, I think that modern liberals are more concerned about the excesses of unregulated capitalism and therefore tend to support more regulation of property rights, worry more about economic inequality (and thus favor more progressive taxation, for example) and the unfettered power of corporations, etc. With this definition, you can sort of see how liberalism might move us a little bit in the direction of communism and socialism. Of course, as pointed out, this is the same way in which conservatism moves us a little bit in the direction of fascism. Both are probably true but not really very useful points to make.

Of course, to an extreme conservative, almost any attempt to regulate the rights of property owners or to tax at all progressively (what they would call "redistribution" as if one could easily describe something in our complex interactive society that corresponded to not "redistribution") will be seen as moving down a slippery slope toward communism or socialism. (To some conservative extremists, the fact that we have any sort of welfare state whatsoever essentially means we are already socialist...Or, close to it.)

Stratocaster
01-03-2004, 01:16 PM
I think jshore has it basically right. A common perception is that conservatives have a much more immutable affection for individual rights, regardless of how exercising those rights affect others (remember, I said perception, and I understand that many who call themselves conservative care not a whit for the individual rights of certain others--say gays who want to marry). I have the right to my own stuff, I have the right to guide my own destiny. Less government, just leave us all alone, and may the best man win. That kind of thing.

A common perception of liberals is that they are much more concerned with balancing individual rights with achieving the greatest good for the greatest number. Yeah, you have the right to your own stuff, but that guy over there lives in abject poverty. Aren't we obligated to spread the wealth? Isn't one of government's roles to check the sorts of egregious abuses that occur when the free market is left to its own ruthless ends?

That perception, IMO, is of a philosophy that's at least a step in the direction of communism. That's not necessarily a bad thing, either. The free market left unchecked is a ruthless animal.

pervert
01-03-2004, 02:10 PM
I think the confusion lies in overlapping civil liberties (freedoms of speech, association, movement and so on) with economic rights (specifically the right to own property). I can think of examples of both conservative and liberals wanting to curtail certain freedoms or rights while extoling the virtues of others. jshore hit the nail on the head. If you concentrate just on the economic differences between the 2 ideals, you can see that liberalism is closer to communism than conservatism is. If you look at the civil rights issues you might be able to suggest that conservatism is closer to facism than liberalism is. But the slurs require that you ignor essential characteristic of all 4 philosophies.

Apos
01-03-2004, 02:33 PM
With this definition, you can sort of see how liberalism might move us a little bit in the direction of communism and socialism.

Sure, just like when I walk to the store to buy some asprin, I'm actually also moving "closer" towards robbing it.

elucidator
01-03-2004, 02:42 PM
Back in The Days, I had occassion to have considerable contact with genuine, pure-D, Communists, Trostkyists, the entire gibbous zoo. I heard a Stalinist criticize a Maoist for his failure to understand the industrial basis of Marxism. They reminded me of some of my more deranged Baptist cousins, having only substituted Dialectical Materialism for God.

Thing is, Commies loathed liberals! Liberals were ameliorists, trying to improve things as they found them, trying to reduce the conditions of suffering that should properly lead to revolution. According to the principles of Leninist pathology, anything which served to slow or prevent the revolution was wrong, even if those actions reduce the suffering of the people.

That's just plain nuts.

eli_the_fanatic
01-03-2004, 02:49 PM
> anyone who's ever taken a Sociology course knows that a "classless society" is an utter impossibility. It goes against everything in human nature.

This is bullshit. Nobody "knows" that a classless society is an "utter impossibility," and you don't "learn" that in a Sociology course unless the Sociology professor "teaches" it. The idea that class is a theory at best, not a fact, and indeed, there have been and are essentially classless societies, so it's a poor theory. What it really is a knee-jerk capitalist-society mantra. "It's against human nature. Baaaaa."

As for communism = liberalism, moron "conservatives" don't know what either one, nor do they know what conservativism is. It's just more bleating from the poorly educated, non-reflective, American sheepscape.

Truth Seeker
01-03-2004, 03:16 PM
There are a couple of problems here. First, trying to completely describe any philophical/political.economic philosophy by shoe-horning it into one of two categories is never going to be very useful. There's probably a fair plurality of voters in the U.S. that are economically "conservative" and socially "liberal" -- think Arnold Scwarzenegger.

Second, the left/right, conservative/liberal dichotomy implies that political philosophies are laid out on a line such that the far left is the opposite of the far right. This is false. Rather, political philosphies fall on more of a circle. If you go too far in any direction, you'll end up back where you started. In other words, right isn't the opposite of left. Rather, democratic is the opposite of authoritarian. From a practical political perspective, fascism and communism are largely indistinguishable.

In many societies, it is the "liberals" who are pushing for less regulation. To the extent "liberal" and "conservative" have any inherent meaning, the liberals want to change things and the conservatives want to maintain things. However, almost equally often, it's the "conservatives" who want to "restore" the long-lost glories of some mythical past by changing things and it's the liberals who doggedly defend the grossly disfunctional status quo.

In a word, such labels may simplify the debate but they seldom help clarify it.

Nobody
01-03-2004, 03:40 PM
Basically, the arguments behind equating Liberalism with Communism goes something like this. (And I'll be using the Soviet Union for communist examples, and America for Liberal examples.)
-----------------------------------------------------------------------------------
The Communist ideal is to spread the wealth evenly amongst everybody, thus, eliminating the economic class system.

Liberals are usually in favor of heavily taxing the rich, and redistributing that money to the poor (I.E., welfare). Liberals are also usually the ones to promote class warfare.
-----------------------------------------------------------------------------------
In Communism, the government is supposed to take care of you "From cradle to gave."

Liberals usually seem to think of the government as the best solution to most of our problems.
A couple of examples are wanting senior citizens to live off of Social Security instead of encouraging people to set aside retirement accounts for when they get older and not supporting school vouchers even in areas where public schools are failing miserably, such as DC where plenty of Congressional members send their kids to private schools, while being against vouchers to allow not so well off families to do the same.
-----------------------------------------------------------------------------------
And finally, Communist nations are usually hostile to religion.

Liberals are usually the ones seen as being anti religious.
They are seen as trying to destroy religion and are usually the ones behind lawsuits against public expression or display of religion, such as prayer in schools or manger displays on public property during Christmas.
Another way that they are seen as anti religious is that Liberals are usually the ones to do things like replace Christmas with winter or holiday in such words as Christmas tree, Christmas vacation, etc...
-----------------------------------------------------------------------------------
Thus, to sum up the argument, both Communists and Liberals are in favor of wealth redistribution, big government taking care of us, and all our needs, and are anti religious.

Yes, this may all sounds pretty harsh, and since this is GD, all these points will probably be debated, but I'm just trying to answer the question to the best of my knowledge, and I think that I hit it on the head.

Futile Gesture
01-03-2004, 03:43 PM
Originally posted by Lissa
Is it just a convenient slur which has no bearing on reality? To me, such an epithet belongs to another era. When you have a closed mind and little to defend your position it helps if you take all opposition, supposed or real, and create one big, single conspiracy out of them. That way you can pretend they are all the same and it's a simple case of right vs wrong and you against the combined forces of evil! It's also a very handy tactic if you can't be bothered to, or just plain can't, address them individually. One strawman fits all sizes if you pretend they are all the same.

It's as simple as that.

dal_timgar
01-03-2004, 04:06 PM
Name calling is an old propaganda technique.

Diogenes the Cynic
01-03-2004, 04:18 PM
Liberals are usually the ones seen as being anti religious.
They are seen as trying to destroy religion and are usually the ones behind lawsuits against public expression or display of religion, such as prayer in schools or manger displays on public property during Christmas.
Another way that they are seen as anti religious is that Liberals are usually the ones to do things like replace Christmas with winter or holiday in such words as Christmas tree, Christmas vacation, etc...
I would argue that none of the examples you mention are "anti-religious" and would also remind you that most "liberal" in the US self-identify as religious.

It's those who would mandate religious practices in schools or insist on erecting monuments in courthouses who are hostile to religious freedom.

Zoe
01-03-2004, 04:26 PM
Joel: [Liberals] are seen as trying to destroy religion and are usually the ones behind lawsuits against public expression or display of religion, such as prayer in schools or manger displays on public property during Christmas.

Joel, please notice that Liberals are not opposed to public displays or expressions of religion. We are opposed to the display of religious symbols on property belonging to the government. Do you understand the difference?

If you don't understand, you are making a terrible mistake. Many of us who are Liberal are also devout. In my case, I am a Christian. How can you say that I am anti-religious?

Be the way, it is not against the law to pray in school or to read your Bible at school. Did you know that?

Communists may or may not try to remove religious elements. Very often Liberals promote concepts that you might describe as traditionally "Christian" -- Peace on earth, respect for all life, helping those in need, loving our enemies.

Joel: Liberals usually seem to think of the government as the best solution to most of our problems.
Another way that they are seen as anti religious is that Liberals are usually the ones to do things like replace Christmas with winter or holiday in such words as Christmas tree, Christmas vacation, etc...

Has anyone tried to control your language, Joel, or is it that you tend to hear "Happy Holidays" more often now than "Merry Christmas"? I used to hear "Merry Christmas" more but that was back when I was ignorant and assumed that everyone that I talked with was celebrating Christmas. Remember that Holiday actually means Holy Day anyway. But use what you choose. You have freedom of speech.

Joel: A couple of examples are wanting senior citizens to live off of Social Security instead of encouraging people to set aside retirement accounts for when they get older...<snip>

That is really funny. Surely no one believes that anyone can live decently on Social Security. I was a teacher. My SS is about $1100 a month. Room and board at assisted care runs about twice that much. And if you need a medicine, you are out of luck.


... and not supporting school vouchers even in areas where public schools are failing miserably, such as DC where plenty of Congressional members send their kids to private schools, while being against vouchers to allow not so well off families to do the same.

I am a Liberal who does support school vouchers. I believe that public schools have to be totally revamped from the ground up. But I suspect those vouchers are not going to pay for poor kids to go to really good private schools.

We support class warfare? That's a new one on me! Want to explain?

Peace, even to the people on the rich side of town...

;)

eli_the_fanatic
01-03-2004, 04:31 PM
I have to love Joel's "five paragraph essay," just like the 500 worder he'd hand into a high school sophomore English teacer and get, oh, maybe a B.

jshore
01-03-2004, 04:37 PM
Originally posted by Joel
The Communist ideal is to spread the wealth evenly amongst everybody, thus, eliminating the economic class system.

Liberals are usually in favor of heavily taxing the rich, and redistributing that money to the poor (I.E., welfare). Liberals are also usually the ones to promote class warfare.
-----------------------------------------------------------------------------------
In Communism, the government is supposed to take care of you "From cradle to gave."

Liberals usually seem to think of the government as the best solution to most of our problems.


The above is a pretty good illustration of what I what I meant when I said:


Of course, to an extreme conservative, almost any attempt to regulate the rights of property owners or to tax at all progressively (what they would call "redistribution" as if one could easily describe something in our complex interactive society that corresponded to not "redistribution") will be seen as moving down a slippery slope toward communism or socialism.


By the way, I wouldn't say that liberals are the ones who "promote class warfare". I'd say that conservatives (at least of the GW Bush variety) practice it and liberals just try to make the lower and middle classes aware that it is happening (while the conservatives often try to distract them with appeals to "family values" and by throwing them a few scraps in their tax cuts). As Warren Buffet (who is a very rich person who is sufficiently non-self-delusional to appreciate his debt to a society structured in a way that allowed him to become so fabulously wealthy) so nicely put it (http://www.andrewtobias.com/newcolumns/030630.html): "If this is class warfare, then my class is winning!"

ITR champion
01-03-2004, 04:42 PM
What Gesture said. When running for office or trying to drum up support for a position, it works better to attack the other guy than to offer reasons why your own position is superior. And it works better to try associating the other guy with something that your audience dislikes than to provide a logical reason for opposing their position, specifically since that lets you avoid mentioning the more unpleasant aspects of your own position.

For instance:

The liberals are wrong about wanting universal health care because the advantages gained by having competitive forces in our market-driven system outweigh the advantages of providing health care for the poor in a universal coverage system.

just doesn't rally the troops the that this does:

The liberals want universal health care coverage, and that's obviously communist, so they must be wrong.

jshore
01-03-2004, 04:47 PM
Originally posted by Joel
Another way that they are seen as anti religious is that Liberals are usually the ones to do things like replace Christmas with winter or holiday in such words as Christmas tree, Christmas vacation, etc...

So, is respect for the fact that others might have religious beliefs different from your own now considered to be anti-religious? At any rate, as a Jew (admittedly, an atheistic one), I can assure you that I still get many "Merry Christmas" wishes every year. (I seldom bother to correct people ... I know they mean well and I take it in the spirit it was intended. However, I do appreciate when people make an effort to acknowledge the diversity of different religious beliefs and I do tend to expect it a little more when the event is more official. For example, when I was in grad school, I always appreciated it that our department officially called what they had a "pre-holiday party" even though it was more commonly referred to as "the Christmas party" by most including myself.)

GIGObuster
01-03-2004, 04:56 PM
Originally posted by Joel
The Communist ideal is to spread the wealth evenly amongst everybody, thus, eliminating the economic class system.

Liberals are usually in favor of heavily taxing the rich, and redistributing that money to the poor (I.E., welfare). Liberals are also usually the ones to promote class warfare.
Wrong, after reading about how Communism and the radical left were stopped from gaining a strong following in the USA, the reality is that Liberalism defused class warfare. I think that the efforts to claim that even the defusing should be called "class warfare" are really dumb.

jshore
01-03-2004, 05:45 PM
Good point, GIGObuster. After the recent corporate scandals, The American Prospect had a piece arguing just that...that it has been the job of liberals to save capitalism from itself, i.e., to curb capitalism's excesses to the point where it keeps the push for a more radical revolution marginalized.

Brutus
01-03-2004, 05:46 PM
Originally posted by GIGObuster
Wrong, after reading about how Communism and the radical left were stopped from gaining a strong following in the USA, the reality is that Liberalism defused class warfare. I think that the efforts to claim that even the defusing should be called "class warfare" are really dumb.

Nyet, comrade. When various liberal candidates decry 'tax cuts for the rich', they are specifically and disingenuously appealing to low income folks. (And the not-to-bright among the middle class!) But you aren't denying the 'redistribution of wealth' charges, are you?

AHunter3
01-03-2004, 06:02 PM
eli the fanatic (quoting Lissa and responding):> anyone who's ever taken a Sociology course knows that a "classless society" is an utter impossibility. It goes against everything in human nature.

This is bullshit. Nobody "knows" that a classless society is an "utter impossibility," and you don't "learn" that in a Sociology course unless the Sociology professor "teaches" it. The idea that class is a theory at best, not a fact, and indeed, there have been and are essentially classless societies, so it's a poor theory. What it really is a knee-jerk capitalist-society mantra. "It's against human nature. Baaaaa."

Actually, the assertion that Sociology (sometimes overtly, sometimes tacitly) makes about what is an "utter impossibility" is a society that is not stratified by power. Marxism -- not seriously taught as a theory in most Political Science or Economics departments in the US, or so I am led to believe -- is a central part of theoretical canon within sociology.

It doesn't occupy the place of a sacred cow, though. In most sociology departments, incoming students are introduced to marxist theory and therefore the premise that all social structures and relationships can be understood according to relationships of power that are defined in terms of ownership & control of the means of production. Then in the chapters that follow they are exposed to Max Weber and other theorists and thereby the notion that power stratification need not depend on material considerations at all -- power can be vested in social positions and their reputation, or manifested in control of the mechanisms of overt violence for that matter, and therefore marxism is generally portrayed by the discipline of sociology as interesting but unduly limited in scope. But what survives and persists throughout most sociological theory is the notion that all social structures and relationship patterns are about power and that all societies are stratified by power and the struggle to obtain / maintain it.

Within that framework, "radical" (a term that I consider to be pretentious on their part) perspectives and their adherents tend to be overtly critical of the propriety and fairness of existing distributions of power and the social structures through which it is weilded and maintained, while "conservative" perspectives tend to operate from an unquestioning or disinterested position with regards to such issues, i.e., insofar as societies are and always will be stratified by power this and these and those are the ways in which power is manifested and maintained and it is neither useful nor proper for sociology to attempt to assess whether these fixtures and methods are proper or fair.

There is nothing known as "liberal" sociology, but the general attitude of people who style themselves politically as "liberals" is that power stratification is unnecessary or at least that less of it is necessary than we currently experience. They tend to believe that there is, or might be, some way in which good ideas would win out over bad ideas after being aired in a marketplace of ideas where the social power of the person speaking them or favoring them would not be a determining factor.

Conservative critics of liberals tend to emphasize liberal attempts to ameliorate or oppose the concentration of power that occurs as a consequence of economic wealth, and to portray other forms of liberal opposition to concentrated power as subsidiaries of that (i.e., liberals protesting increases in police power are perceived as taking this position because the police are civil defenders of the capitalist state, rather than because of police power in and of itself).

The stance of liberals by and large is not informed by economically-centered theory of any sort, though. The point of origin for most liberals is "fairness", the belief that it should be possible to stop power stratification from giving any party unfair advantages over others such that outcomes are due to who holds the social power rather than the quality of the individual's work or ideas or other efforts. Both the best of liberal ideas (eliminating property ownership, sex and race as reasons for restricting the vote to a subset of adults) and the silliest (arguing against grades in school so everyone would have equal opportunity to get hired after graduation) can be traced back to this desire for fairness.

In truth, there is no fully-formed and fully-articulated "liberal social theory" in the sense of a blueprint or utopian vision of what a "totally fair" society would look like. As a consequence, there is a trend among marxist-socialist types to occasionally proclaim that if liberals thought out their issues to their final conclusions liberals would all be socialists. On the other hand, they also quite often condemn liberals as collaborators and apologists who keep the evil capitalist system running, and as so many others have said, liberals generally reject socialist goals and views and do not consider themselves to be kin to socialists at all.

ITR champion
01-03-2004, 06:04 PM
Originally posted by Brutus
Nyet, comrade. When various liberal candidates decry 'tax cuts for the rich', they are specifically and disingenuously appealing to low income folks. (And the not-to-bright among the middle class!) But you aren't denying the 'redistribution of wealth' charges, are you?

Well, obviously when they speak out against tax cuts that favor the rich, they're appealing to the low income and middle income people. But I don't see why it's dishonest. Do you have any examples of candidates specifically lying about the amount of a specific tax cut that's going to a specific group?

As to redistributing wealth, the majority of government spending is created for the specific purpose of handing wealth to the rich, and conservatives are constantly trying to add more. For instance, look at the recent energy bill and agriculture handouts. So the progressive income tax helps balance out government action by giving a minor advantage back to the poor and middle class. It also balances out the regressive sales taxes at the state level.

eli_the_fanatic
01-03-2004, 06:05 PM
>When various liberal candidates decry 'tax cuts for the rich', they are specifically and disingenuously appealing to low income folks.

Do you deny that there have been tax cuts for the rich under Republican leadership, or just disagree with the notion of encouraging poor people to vote based on their own self-interest? Why should poor people be FOR tax cuts for the rich, which result in either higher taxes for themselves or roll back of government services?

What is disingenuous about that?

Wrapped up in Republican rhetoric is the notion that poor people don't have the right to determine the course of their own government. Hence the propoganda to make them fear and hate government. "Get government off your back!" they cry. Why? So businesses can roll right over them? Lower wages, roll back safety regulations, get rid of health insurance?

That is disingenuous.

Oops, I guess my belief in representative democracy rather than a plutocracy is betraying my communist leanings.

AHunter3
01-03-2004, 06:08 PM
(just in case it's not obvious, I'm only quoting eli the fanatic to give myself a launching point; my post is intended as a participation in the general discussion here, not just as an aside to eli)

Brutus
01-03-2004, 06:12 PM
Originally posted by eli_the_fanatic
...Do you deny that there have been tax cuts for the rich under Republican leadership,

There have been tax cuts for all sorts of people, from rich to poor. It is (at best) scaremongering to call the tax cuts 'for the rich'.

AHunter3
01-03-2004, 06:32 PM
One can be harshly critical of the workings of the unfettered & unmodified market economy without embracing socialism, communism, or marxism.

I know some born-again fundamentalist Christians who rant about the vacuity and vapidity of modern commercial culture. I find myself substantially in agreement with them, but despite that fact I have yet to embrace the belief that inviting Jesus of Nazareth into my cardiovascular cavity and believing the Bible to be the directly dictated verbatim word of Yahweh the One God is going to fix any of that.

Taxes exist because of the belief that the market economy will not meet people's needs properly if left strictly alone. Laws against monopolies and other specified business practices also work to ameliorate and cushion the functioning of the market economy. Indeed, it is possible that even Brutus would not like it if the only highways built and maintained were those paid for by individuals and corporations who desired roads there and spent their own money putting them there and keeping them paved. Or if the only police or military forces in existence were privately employed by those desiring police protection from domestic or foreign threats.

Once we've established that, the rest is just a matter of how much, and how to spend it.

eli_the_fanatic
01-03-2004, 06:51 PM
>There have been tax cuts for all sorts of people, from rich to poor. It is (at best) scaremongering to call the tax cuts 'for the rich'.

There's disingenuine-ness for you. Under our Republican governer, there have been tax cuts for the rich. These tax cuts caused budget shortfalls resulting in increased property taxes for me, as well as frozen wages, which (considering the increase in health benefit costs and the cost of living) amounts to a pay cut. I think, typical of Republican tax "relief" is just like this. It costs me, to make the rich richer. This is also Redistribution of Wealth. Take my money and give it to the rich.

GIGObuster
01-03-2004, 06:54 PM
Originally posted by Brutus
Nyet, comrade. When various liberal candidates decry 'tax cuts for the rich', they are specifically and disingenuously appealing to low income folks. (And the not-to-bright among the middle class!) But you aren't denying the 'redistribution of wealth' charges, are you?
The point remains: considering that class warfare is silly.

Conservatives can make the argument that the rich should not be taxed at a higher rate than the poor and middle class, but they don't do that, better to bring fear. And this is ignoring that the wealthy get to benefit the most by the taxes they pay. Highway construction would be affected. The military would dwindle to nothing and there would not be the markets that military intervention does open. (Not thinking here of Iraq in particular but of Japan in the 19th century)

Why use "class warfare" to describe something that does not reach the level of violence of a war in the US? The use of that term is fear mongering indeed, but it is not coming from the liberals.

jshore
01-03-2004, 07:00 PM
Originally posted by Brutus
[B]There have been tax cuts for all sorts of people, from rich to poor. It is (at best) scaremongering to call the tax cuts 'for the rich'.

Well, I guess this is true if by "scaremongering" you mean doing in-depth analyses of who gets what under the tax cuts and then reporting those to the public, as organizations such as CTJ (http://www.ctj.org/) (Citizens for Tax Justice) do. I can understand how you conservatives would hate that sort of shit since it actually gives the whole story, unlike Bush's deceptive appeals to "averages" to make his tax cuts sound like they give the average-Joe more than they really do. (As has been pointed out, if you get Bill Gates and 50 homeless people in a room, then on average, the people in the room are billionaires.)

I believe the numbers that CTJ has documented is something on the order of 40% of the money from the Bush tax cuts going to the top 1%. The counterargument that they pay almost that share in taxes is true only if you consider only federal income taxes, thus excluding federal payroll taxes and all the primarily-regressive state taxes people pay.

One also has to realize that when you are cutting taxes and not cutting spending but just running deficits, the money has to come from somewhere. In part, it is probably coming indirectly from increases in state taxes which tend to offset much of the federal tax cuts for the poor and middle class but not for the rich. In part, it is coming from inevitable rises in taxes down the road (or draconian cuts in services). Unless these taxes are raised primarily from the rich who have enjoyed the cuts, the net effect will be a transfer of money from the poor and middle class to the rich.

Apos
01-03-2004, 07:03 PM
There have been tax cuts for all sorts of people, from rich to poor. It is (at best) scaremongering to call the tax cuts 'for the rich'.

No, it's perfectly accurate, and the administration has been boldly deceptive with their abuse of people's misunderstanding of how averages work.

What's misleading is not, in the same breath, noting that any across the board tax cut will disproportionately benefit the rich, simply because they pay most of the taxes to begin with. Getting a tax cut of any appreciable size that DOESN'T fall mostly on the rich is actually fairly hard.

jshore
01-03-2004, 07:07 PM
Originally posted by jshore
I believe the numbers that CTJ has documented is something on the order of 40% of the money from the Bush tax cuts going to the top 1%.

Here (http://www.ctj.org/pdf/gwbdata.pdf) are their latest numbers showing it is about 30% in the current year, rising to near 40% or over 50% by 2010, depending on whether or not the current "sunsets" in the tax provisions are kept in place or not. (With the higher number being if the sunsets are kept in place.)

Apos
01-03-2004, 07:08 PM
The counterargument that they pay almost that share in taxes is true only if you consider only federal income taxes, thus excluding federal payroll taxes and all the primarily-regressive state taxes people pay.

Why should taxes be "fair" if they amount to the same "share" of total income? That isn't a meaningful comparison of equality along ANY metric.

But you're right. Cutting taxes today without cutting spending today is simply making a tax raise in the future more inevitable. It's as if Bush was walking into our house, ordering a whole bunch of stuff on our credit cards, and then saying that he'd done us a big favor since he did take any money from our pockets. ANYONE can pretend to be for a lower tax burden with such tomfoolery.

jshore
01-03-2004, 07:29 PM
Originally posted by Apos
What's misleading is not, in the same breath, noting that any across the board tax cut will disproportionately benefit the rich...

I tried not to breathe between my sentence "I believe the numbers ..." and "The counterargument that ..." ;)


Why should taxes be "fair" if they amount to the same "share" of total income? That isn't a meaningful comparison of equality along ANY metric.

I lost you. My point is that some would say, "Well, yes, the richest 1% are getting 40% of the tax cut but that is because they are paying nearly a 40% of the total taxes." My point is that this latter statement is only true if you look just at the share of federal personal income tax paid (with the actual (http://www.taxfoundation.org/prtopincometable.html) most recent numbers being that the top 1% paid 37.4% of them in 2000 and 33.9% in 2001).

What Bush and the treasury department like to point out is that the federal income tax was cut slightly progressively (at least in the 1st round of tax cuts) in the sense that the poor saw a bigger percentage decrease in their federal income tax burden then the wealthy. However, besides ignoring the estate tax cut (and also I think prior to this latest round with the dividends tax cut), this only illustrates that it is possible to cut one of the most progressive taxes a bit progressively and still make the overall tax burden that people face more regressive. To give an example that is probably pretty close to the reality faced by some fairly well-off and some fairly lower or lower-middle class taxpayer, say,

Joe Working Man pays 10% of his taxes through the federal income tax and 90% through other taxes. If you cut his federal income tax by 15% then his total tax burden is reduced by 1.5%.

Ralph Executive pays 90% of his taxes through the federal income tax and 10% through other taxes. If you cut his federal income tax by 10% then his total tax burden is reduced by 9%.

Hence, you have a tax cut that, while cutting the federal income tax by a larger percentage for the poor than the wealthy, has cut the total tax burden much more in percentage terms (and way way more in dollar terms, of course) for the wealthy than poor. You are thus left with a less progressive tax structure overall.

Brutus
01-03-2004, 08:04 PM
Originally posted by eli_the_fanatic
[BThere's disingenuine-ness for you. Under our Republican governer, there have been tax cuts for the rich. [/B]

The tax cuts in Minnesota were for all three brackets. The middle bracket recieved the largest perentage reduction (from 8% to 7.25%). The top and bottom recieved the same .5% reduction. Why would you refer to the tax relief in Minnesota as 'for the Rich'?

jshore
01-03-2004, 08:38 PM
Originally posted by Brutus
The tax cuts in Minnesota were for all three brackets. The middle bracket recieved the largest perentage reduction (from 8% to 7.25%). The top and bottom recieved the same .5% reduction. Why would you refer to the tax relief in Minnesota as 'for the Rich'?

Well, I won't presume to speak for eli in exactly what he was saying, but his basic point that the income tax cuts in Minnesota will go in large part to upper incomes whereas the increases in property taxes that occur (as will as other effects) will be more broadly felt is indeed borne out by the CTJ analysis (http://www.ctj.org/itep/whopays.htm) of Minnesota state and local taxes. What that analysis shows is that:

(1) The tax structure in Minnesota in 2002 was fairly flat...making it more progressive than many other states...with the bottom 20% paying 10.5% of their income in taxes and the top 1% paying 9.3% in taxes. [If you include the effects of the federal tax deduction one can take for state taxes, then the result is more regressive, with the bottom 20% still paying 10.5% of their income in state and local taxes while the top 1% pay just 6.4%. However, admittedly you only want to count this deduction once when considering the state/ local and federal tax structure...so you can assign it to the state/local level or the federal level but not both.]

(2) The distribution of taxes paid by the bottom 20% (in terms of percent of total income) is:
Sales and excise taxes - 6.9%
Property taxes - 3.2%
Income taxes - 0.4%

For the next 20%, it is:
Sales and excise taxes - 5.1%
Property taxes - 2.3%
Income taxes - 2.5%

For the top 1%, it is:
Sales and excise taxes - 1.0%
Property taxes - 1.6%
Income taxes - 6.8%

So, what you see is that even if income taxes are cut in a fairly "flat manner", the net effect will be to reduce the tax burden of the lowest 20% by almost nothing, to cut the tax burden of the next 20% by more but still not that much, and to cut the tax burden of the top 1% by the largest amount (in terms of either percentage of total income or percentage of total state/local tax burden). This is much the same as the story I told about the federal income tax cuts.

Hope that helps you understand why eli (I believe correctly) considers a cut in income taxes while property taxes are forced up and wages are frozen to result in a net transfer of wealth upward.

Diogenes the Cynic
01-03-2004, 09:49 PM
Excellent post, jshore.

I was going to respond to Brutus but I have nothing left to say. Kudos on your anaysis.

pervert
01-03-2004, 09:51 PM
Originally posted by jshore
Joe Working Man pays 10% of his taxes through the federal income tax and 90% through other taxes. If you cut his federal income tax by 15% then his total tax burden is reduced by 1.5%.

Ralph Executive pays 90% of his taxes through the federal income tax and 10% through other taxes. If you cut his federal income tax by 10% then his total tax burden is reduced by 9%.
I'm not sure I follow you at all here. I realize that sales taxes and property taxes are paid by everyone. And I understand that sales taxes paid by poor people are a bigger portion of thier own income. Bu I'm not sure how this translates to the point you are making. How is it that the executive only pays 10% taxes through other means? Presumably he uses the portion of his income which is not taxed to buy things or invest. Does he not pay taxes on those transactions? Property taxes are percentages of the value of the property. Yet you seem to imply that rich people pay less in property tax than poor people do.

I agree that Republicans often mislead by confusing averages with dollar amounts. But I think liberals do the same when they conflate tax rates and percentages of income.

BTW, can you give me a summary of what CTJ means by "effective tax rates."?

Let me ask you 1 more thing. If rich people pay a larger portion of the total taxes recieved should they not recieve a larger portion of any tax cut? Under these circumstances isn't it better to characterize the tax cut as a failure to distribute wealth rather than an actual distribution of wealth?

I am, of course, not considering whether a tax cut is a good idea at all.

pervert
01-03-2004, 09:58 PM
Originally posted by jshore and aplauded by Diogenes
(2) The distribution of taxes paid by the bottom 20% (in terms of percent of total income) is:
Ok, but how is the total amount of tax collected distributed. How much is collected by sales, property, and income taxes. And how is that amount distributed amongst the different income ranges.

Let me ask you guys this way. If we completely revamped the tax system where would you want the cuttof to be. Should the top 50% of earners pay for the govenrment? The top 25%? or should most of the money come from the top 2 or 3%?

Nobody
01-03-2004, 10:44 PM
I don't have time now to respond to each reply made by some of you to my various posts, I'll get to that later, but I will just say this.

I find it funny that those of you replied to the points I made automatically assumed that I believed everything that I posted. I never stated my positions one way or the other. I was giving the usual reasons that some associate Liberalism with Communism.

As for what I believe and what I use to defend my positions, I'll get into that later. But for now, I will say this, I do believe that it is kind of harsh to call Liberals Communists.

jshore
01-04-2004, 12:53 AM
Originally posted by pervert
I'm not sure I follow you at all here. I realize that sales taxes and property taxes are paid by everyone. And I understand that sales taxes paid by poor people are a bigger portion of thier own income. Bu I'm not sure how this translates to the point you are making. How is it that the executive only pays 10% taxes through other means? Presumably he uses the portion of his income which is not taxed to buy things or invest. Does he not pay taxes on those transactions? Property taxes are percentages of the value of the property. Yet you seem to imply that rich people pay less in property tax than poor people do.

Well, obviously, my example was just a hypothetical example, so I can't vouch for the total realism of the numbers. The 10 and 15% numbers for the cuts were at least approximately grabbed off of what the Bush Treasury Department put out. As for the 10% other taxes on the rich guy, okay, when I originally dreamed up this argument, I think I was imagining talking only about federal taxes only...So, I was imagining a rich guy who paid 90% of his taxes through the income tax and 10% through the payroll tax. This is in fact quite easy to imagine since most of the payroll tax cuts out after about $90,000 of income and it only applies to wage income anyway.

If we are considering all taxes, it might be a bit more difficult to come up with an example where 90% of the taxes a rich person pays are federal income taxes...but it probably wouldn't be hard for it to be 75-80%, so if it makes you happier you can downgrade the percentage decrease in his total tax burden from my 9% estimate to 7.5 or 8%.

As for your specific questions about investments and property taxes: Income on investments are taxed as part of the personal income tax. And, yes, rich people pay property taxes and their properties tend to be more expensive but, as the CTJ Minnesota example shows, they tend to pay a lesser percent of income in property taxes than poor people do. I guess this means that the value of their property doesn't tend to scale up with income on a linear basis. For sale taxes, this is definitely true...I.e., people with high incomes do not spend proportionally higher on goods. They tend to invest or save a good portion of their money and they also tend to spend a larger fraction of their money on non-taxable services.



I lost you here. What are liberals conflating exactly?

[quote]
BTW, can you give me a summary of what CTJ means by "effective tax rates."?

My interpretation would be that they figure out the total amount the person earning that amount pays in each tax (on average) and divide by the person's income. That gives the effective rate. (In some cases, I believe there might be some effective assigning of taxes...e.g., they might assign property taxes to the renters rather than the landlord, although I am by no means sure whether or not they do that.)


Let me ask you 1 more thing. If rich people pay a larger portion of the total taxes recieved should they not recieve a larger portion of any tax cut?

Well, obviously one can debate whether or not this should be the case. But, my whole point is that the rich are getting an amount back which is out of proportion with the larger portion that they are paying if you consider the tax burden as a whole (or even only the federal tax burden as a whole) rather than only the federal income tax burden. If each person was getting back, say a 5% rebate on their total tax burden then this tax cut would be neither regressive or progressive in the sense that it would leave the overall tax structure just as progressive or regressive as it was before. However, in the Bush tax cuts, the rich are getting a larger percentage rebate of their total tax burden than the poor are. This means the tax structure as a whole is becoming less progressive.

Whether this is a good thing or a bad thing, of course, is the subject of debate. But, I think first it is important to establish what is in fact happening with these tax cuts. (I would personally argue that it is a bad thing given the incredible increases in real income, measured either pre- or post-tax that the wealthiest have experienced...from like 1980-1997, the number is something like a 150% [i.e., factor of 2.5] increase in real terms while the gain for those with median incomes has been much, much smaller [about 10%, as I recall]. At a time when essentially all the gains in the economy are going to a select few who already were doing quite dandy, I would argue that a tax cut that cuts these folks taxes proportionally greater than everyone else's is quite nutty. We should be trying to figure out why the rising tide barely seems to be lifting most boats rather than focussing on helping those whose boats have been lifted to the stratosphere. There are, by the way, people who are debating this and there is by no means a consensus...Some argue that it is structural changes in the economy. [And, within these camp, some say that market economics is working and others that there are market failures leading to income inequality that is in fact counterproductive to economic growth. Others argue that it is due much more to economic policy...ranging from "trickle-down economics" policies to tight monetary policy. )


Ok, but how is the total amount of tax collected distributed. How much is collected by sales, property, and income taxes. And how is that amount distributed amongst the different income ranges.

Well, that is a complicated question. I have provided links that show share data for the federal income tax and I have also provided links that show data in terms of effective tax rates (but not share data) for various state taxes on a state-by-state basis. There have been studies, most notably by the Congressional Budget Office, that try to estimate share data for all federal taxes rather than just the income tax. Here (http://www.cbo.gov/showdoc.cfm?index=3089&sequence=2) is a link that will at least get you into that study. It is pretty long and gory and detailed and they measure the share data in about 100 different ways (okay, maybe not 100 but close), although the results don't seem to vary that dramatically with method.


Let me ask you guys this way. If we completely revamped the tax system where would you want the cuttof to be. Should the top 50% of earners pay for the govenrment? The top 25%? or should most of the money come from the top 2 or 3%?

Well, this question points out an interesting conundrum. I believe that the Wall Street Journal editorial page is not incorrect in their concern that an increasingly large proportion of the taxes are paid by a small proportion of the highest-income people, even if they tend to considerably exagerate this effect by focussing almost exclusively on share data for the federal income tax only. Unfortunately, they don't look at the data closely enough to diagnose why this shift has occurred. They imply that it is due to a "steeply progressive" tax structure. However, the reality is that

(1) The tax structure is not all that steeply progressive if you look at the entire tax burden or even just the entire federal tax burden rather than just the federal income tax. Also, the Wall Street Journal editorial page has the annoying habit of quoting only share-of-tax data and claiming that this alone demonstrates progressivity when it does not. For example, they'll say that the fact that the top 1% of earners paid 34% of the federal income tax in 2001 shows that the income tax is steeply progressive when in fact that number shows a combination of a steep inequality in income (where the top 1% earn 17.5% of the AGI) with a moderately progressive federal income tax. [In other words, even if the income tax structure were completely "flat", the top 1% would still have to pay 17.5% of the income tax because that is their share of the income.] The difference between the 17.5% of the income and the 34% of the federal income tax paid becomes less dramatic if you look instead at total federal tax and would become even less dramatic if you factored in state and local tax burdens.

(2) The reason for the shift in the share burden for the richest 1% has absolutely nothing to do with an increase in progressiveness of the tax structure which hasn't occurred (except maybe at the very bottom end of the structure with the earned income tax credit). Rather, this increase in the share that the rich pay is accounted for by the dramatic increase in the share of the income that they earn. A look at the Tax Foundation charts (http://www.taxfoundation.org/prtopincometable.html) makes that very clear. We see that the oft-quoted statistic that the share of the federal income tax paid by the top 1% just about doubled from 19% to 37.4% between 1980 and 2000. But, we also see that the share of the income [as measured by AGI which may not be the best thing to use but seems to be the best we have] went from 8.5% to 20.5%...or in other words went up by nearly a factor of 2.5.

So, I don't think there is any easy answer to your question but the first thing to do is to correctly diagnose the reason for the increase in the proportion of the tax burden being borne by the rich. And, the reason for this is simply the huge explosion in income inequality.

Johanna
01-04-2004, 12:58 AM
People forget that the God of Liberalism himself, Franklin Delano Roosevelt, was the fellow who saved capitalism from going under. Saved free enterprise and the American way of life for the conservatives to continue enjoying it.

There were so many desperately poor people during the Depression that Communism was beginning to catch on in America, and would have led to a serious disruption of the system if FDR hadn't ameliorated the suffering. Call it "capitalism with a human face" (to paraphrase Alexander Dubcek).

Bob Dylan, in his song "Talkin' New York," had some telling lines. He was inspired by Woody Guthrie's advocacy for the poor during the Depression...

A lot of folks ain't got nothin' to eat,
But they got a lot of forks and knives,
And they gotta cut somethin'.

jshore
01-04-2004, 01:01 AM
Originally posted by Joel
I find it funny that those of you replied to the points I made automatically assumed that I believed everything that I posted. I never stated my positions one way or the other. I was giving the usual reasons that some associate Liberalism with Communism.

As for what I believe and what I use to defend my positions, I'll get into that later. But for now, I will say this, I do believe that it is kind of harsh to call Liberals Communists.

Well, okay, but the way you phrased the arguments implied that you either believed that liberals were guilty of such things as "promot[ing] class warfare" or you are just very good at expressing the arguments of conservatives who you disagree with.

The fact that you ended your post with "Yes, this may sound pretty harsh...I think I hit the nail on the head" further implied to me that you had sympathy with the characterizations of liberals that you expressed, although I suppose other interpretations of your words are possible.

[I did not interpret it to mean that you completely bought into Liberalism=Communism but that you did seem sympathetic to the characterizations of liberalism that you expressed and my belief is that these characterizations are already quite off-base.]

jshore
01-04-2004, 01:09 AM
Originally posted by jshore
(I would personally argue that it is a bad thing given the incredible increases in real income, measured either pre- or post-tax that the wealthiest have experienced...from like 1980-1997, the number is something like a 150% [i.e., factor of 2.5] increase in real terms while the gain for those with median incomes has been much, much smaller [about 10%, as I recall]....

Here (http://www.cbpp.org/4-16-02tax.htm) is a cite for this data (which also provides a few other interesting facts). The actual years were 1979-1997. I believe it has been pointed out elsewhere that the lower and median income folks did finally make some better gains in real income in the 1997 to 2000 timeframe when the economy really caught fire and the labor market became very tight, although obviously nothing to nearly make up the differential that I talked about. Also, I don't know how much the current recession has erased those gains or whether such data is even available yet.

pervert
01-04-2004, 01:46 AM
jshore Thanks. I agree that it is a very complicated subject.

What I was trying to say v. the liberals confusing percentage of income with tax burden is similar (although in the other direction) to your criticisms of the Wall Street Journal editorial. Your earlier post and the entire CTJ link as far as I can tell only talks about taxes as a percentage of income. While you are correct (I assume, I have not read the article you refer to, but have seen others like it) that the WSJ concentrates on percentage of the taxes paid to the exclusion of percentage of income. I see these as the same mistake. You can't simply say that poor people paying 2% more of their income this year while rich people will only pay 1% more is unfair unless you look at how much of the total governtment revenue is paid by each already. Similarly you can't say that rich people paying 34 times as much at poor people is unfair unless you look at the disparity of their incomes.

Personally, I find problems with measuring citizenship (and thus tax burden) by property ownership. But within certain ranges it does work. For instance as long as we don't require that poor people pay a share of the governments revenue equal to their population size, and as long as we don't push the tax burden disparity too far beyond the income disparity everything will work out fine.

The problem comes when you forget either side of the equation. If you assume that the government has a right to everything that eveyone earns (note the implication that paying less taxes is equivilent to recieving a check from the government) then you can be said to have socialistic or communistic tendencies. At least where taxation and property rights are concerned. Meanwhile, when you take the conservative / libertarian ideal too far and suggest that people should only pay voluntary taxes (even that each citizen should pay an equal share of the tax burden) you make the same mistake taken to the opposite extreme. For instance, I don't want to speak for the WSJ but I have seen libertarian sources suggest that even a flat tax is itself progressive. The numbers you quoted sugest one reason.

And just because I love the data The congressional Budget site (http://www.cbo.gov/showdoc.cfm?index=1821&sequence=0#table1) indicates that federally income taxes are more than half of all revenues. If you include social security then it is by far and away the biggest source of revenue. What we need to make sense of the CTJ numbers is a similar breakdown state by state.

BTW thanks for the cite on the income numbers. It does include some information about how much of the tax burden goes to various groups.

I'm not sure this is off topic, but it also seems to me that you have confused the disparity of income with some other form of problem.
I would personally argue that it is a bad thing given the incredible increases in real income, measured either pre- or post-tax that the wealthiest have experienced...from like 1980-1997, the number is something like a 150% [i.e., factor of 2.5] increase in real terms while the gain for those with median incomes has been much, much smaller [about 10%, as I recall]. At a time when essentially all the gains in the economy are going to a select few who already were doing quite dandy, I would argue that a tax cut that cuts these folks taxes proportionally greater than everyone else's is quite nutty. We should be trying to figure out why the rising tide barely seems to be lifting most boats rather than focussing on helping those whose boats have been lifted to the stratosphere.
You seem to be arguing that the difference in gain is itself a problem. This sounds very much like the old refrain fo the rich getting richer and the poor getting poorer. The problem, of course is that you have not included how many people are in the two groups you selected. If the top 5% of the population increased its wealth by 150% and the middle 60% increased its wealth by 10%, where did the majority of the new wealth go?

But of course I am commiting the same error because I am pulling these numbers out of an unsavory place. :) All I am saying is that disparity of income is not the end of the poverty vs wealthy store. Just like percentage of income is not the end of the pregressive vs. regressive tax story.

Stratocaster
01-04-2004, 08:24 AM
Originally posted by elucidator
Thing is, Commies loathed liberals! Liberals were ameliorists, trying to improve things as they found them, trying to reduce the conditions of suffering that should properly lead to revolution. That's interesting. I had a close friend who was very active in Socialist party politics. He was always careful to point out he wasn't a Communist, though the distinction wasn't always clear. He was a very interesting fellow to chat politics with.

He reacted similarly if less intensely, chuckling at the distinction between "liberal" and "conservative" in American politics. They were both essentially the same with different window dressings, from his perspective. At the end of the day, in his opinion, the difference between liberal and conservative results didn't amount to shucks, and he was greatly amused at all the caterwauling back and forth across the political aisle.

So, he had no strong affection for liberals, considering them inneffectual and wishy-washy.

John Mace
01-04-2004, 12:05 PM
Stratocaster:
And the same can be said of some Libertarians and how they view "conservatives" of the stripe of Bush I or Dole.

spectrum
01-04-2004, 12:56 PM
John, except libertarianism is not an extreme version of conservatism. True Libertarians are as liberal on social matters as they are conservative on fiscal ones, after all.

Nobody
01-04-2004, 04:30 PM
OK, first I posted what I thought was the reasons that Liberalism is associated with Communism, and now I have the time to post what I personally believe.

Originally posted by Diogenes the Cynic
Liberals are usually the ones seen as being anti religious.
They are seen as trying to destroy religion and are usually the ones behind lawsuits against public expression or display of religion, such as prayer in schools or manger displays on public property during Christmas.
Another way that they are seen as anti religious is that Liberals are usually the ones to do things like replace Christmas with winter or holiday in such words as Christmas tree, Christmas vacation, etc...
Originally posted by Diogenes the Cynic
I would argue that none of the examples you mention are "anti-religious" and would also remind you that most "liberal" in the US self-identify as religious.

It's those who would mandate religious practices in schools or insist on erecting monuments in courthouses who are hostile to religious freedom.

OK DTC, as for your first point, I personally believe that Liberal doesn't automatically equal atheist or agnostic, so I agree with you on that point.

Now, as for your second point, I'm not talking about mandating religious practices in school.

I'm talking about things like sometimes schools having to be sued because they allow secular after school groups but not religious after school groups.
Or cases like that one where an assignment "Who is the person who admire the most" was given, and when a student handed in that it was Jesus, their assignment was rejected on the basis of "Separation of Church and State".
Now, having said that, I realize that there times where groups like the ACLU have come to the defense of religious groups, and so forth, so I personally don't believe that all Liberals are hostile towards religion.

Apos
01-04-2004, 04:50 PM
Joel, if you are going to play act having a position, then you can't get all intrguiged and moody about people responding to that position rather than divining your secret hidden views and addressing them.

John Mace
01-04-2004, 04:52 PM
Originally posted by spectrum
John, except libertarianism is not an extreme version of conservatism. True Libertarians are as liberal on social matters as they are conservative on fiscal ones, after all.
Yes, and I must have been uclear as to why I posted that.

Many people (as per the OP) assume that communism is an extreme form of "liberlism" just as many people assume that libertarianism is an extreme form of "conservativism". I don't think either one is true, but both are beliefs held by some people.

Tamerlane
01-04-2004, 05:02 PM
Originally posted by John Mace


Many people (as per the OP) assume that communism is an extreme form of "liberlism" just as many people assume that libertarianism is an extreme form of "conservativism". I don't think either one is true, but both are beliefs held by some people.

I've heard at least a few people refer to "pure" libertarianism as "right-wing" anarchism, as opposed to the "left-wing" anarchism exemplified by syndicalism.

Not sure if that makes any more sense to me, though.

- Tamerlane

Nobody
01-04-2004, 05:42 PM
Originally posted by Zoe
Joel, please notice that Liberals are not opposed to public displays or expressions of religion. We are opposed to the display of religious symbols on property belonging to the government. Do you understand the difference?
Like I said before, I was giving general arguments, not necessarily my own.
But to answer your question, which seems slightly condescending to me, yes, of course I understand the difference.

If you don't understand, you are making a terrible mistake. Many of us who are Liberal are also devout. In my case, I am a Christian. How can you say that I am anti-religious?
I never said that. What I said is that, that is what is believed by those who call Liberals Communists. I don't, and like I said to DTC, I don't believe that Liberal automatically equals an atheist or agnostic.

Be the way, it is not against the law to pray in school or to read your Bible at school. Did you know that?
Again, that sounds somewhat condescending. Yes, I am aware of that. But are you aware that in many cases, schools had to be sued in order to allow that? And yes, like I said in my post to DTC, sometimes it is the ACLU that takes the pro religious side, so again, I personally don't automatically associate Liberal with anti religious.

Communists may or may not try to remove religious elements. Very often Liberals promote concepts that you might describe as traditionally "Christian" -- Peace on earth, respect for all life, helping those in need, loving our enemies.
Communism countries, like the former Soviet Union and China are notorious for their religious persecution.
And I'm having a hard time coming up with a reply to your second point. I never said that Liberals, or Communists for that point, were against vague and general well meaning concepts. Nor did I say that those who equate Liberal with Communist think so too.

Has anyone tried to control your language, Joel, or is it that you tend to hear "Happy Holidays" more often now than "Merry Christmas"? I used to hear "Merry Christmas" more but that was back when I was ignorant and assumed that everyone that I talked with was celebrating Christmas. Remember that Holiday actually means Holy Day anyway. But use what you choose. You have freedom of speech.
I'm talking about cases in which schools, businesses, or other groups or organizations try to secularize things specifically Christmas. For example, during the holiday season, if the a tree with lights and/or decorations is put up, it has nothing to do with Hanukkah, Ramadan or Kwanzaa. It's a Christmas tradition (yes, origionally taken from a Pagen practice, I know), so to call it a Holiday tree is utterly ridiculous.

That is really funny. Surely no one believes that anyone can live decently on Social Security. I was a teacher. My SS is about $1100 a month. Room and board at assisted care runs about twice that much. And if you need a medicine, you are out of luck.
Many people live on a fixed Social Security income. My grandmother's (on my moms side) only source of income is Social Security, and many other seniors live that way too.

I am a Liberal who does support school vouchers. I believe that public schools have to be totally revamped from the ground up. But I suspect those vouchers are not going to pay for poor kids to go to really good private schools.
Then what do you suspect that they will go for then?

We support class warfare? That's a new one on me! Want to explain?

Peace, even to the people on the rich side of town...
Well, I'm happy that you have no grudge against the rich.
However, it is usually Liberals who spout such rhetoric as all or most rich people get their money either through illegal or unethical means, or by inheritance, instead of by hard work. And yes, there are those who fit that description, people like former Tyco CEO Dennis kozlowski, or the Hilton sisters, but to characterize most or all rich people like this, is unfair.
Or painting the rich as people snooty and always trying to get out of paying their fair share of taxes, and so on. Again, it is usually (but not always) Liberals who vilify the rich.

Nobody
01-04-2004, 05:52 PM
Originally posted by Apos
Joel, if you are going to play act having a position, then you can't get all intrguiged and moody about people responding to that position rather than divining your secret hidden views and addressing them.
Ah ha ha ha, that's funny. Hey, tell me something, if someone stated a thread asking why some people still believe that the earth is flat, and I replied "They believe so because of A, B and C" would you accuse me of secretly being a flat earther?

The question is why do some people associate Liberal with Communist. I don't do that, but I posted why I believe that some people do. That doesn't automatically mean that I believe all of the arguments that I posted.

And I'm keeping nothing a secret about what I believe. I am a Conservative Republican, but I am not an extremist, and there times where my beliefs will deviate from the standard Conservative or Republican line.

Nobody
01-04-2004, 06:14 PM
Originally posted by Joel
The Communist ideal is to spread the wealth evenly amongst everybody, thus, eliminating the economic class system.

Liberals are usually in favor of heavily taxing the rich, and redistributing that money to the poor (I.E., welfare). Liberals are also usually the ones to promote class warfare.
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In Communism, the government is supposed to take care of you "From cradle to gave."

Liberals usually seem to think of the government as the best solution to most of our problems.

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Originally posted by jshore
The above is a pretty good illustration of what I what I meant when I said:

Of course, to an extreme conservative, almost any attempt to regulate the rights of property owners or to tax at all progressively (what they would call "redistribution" as if one could easily describe something in our complex interactive society that corresponded to not "redistribution") will be seen as moving down a slippery slope toward communism or socialism.


By the way, I wouldn't say that liberals are the ones who "promote class warfare". I'd say that conservatives (at least of the GW Bush variety) practice it and liberals just try to make the lower and middle classes aware that it is happening (while the conservatives often try to distract them with appeals to "family values" and by throwing them a few scraps in their tax cuts). As Warren Buffet (who is a very rich person who is sufficiently non-self-delusional to appreciate his debt to a society structured in a way that allowed him to become so fabulously wealthy) so nicely put it: "If this is class warfare, then my class is winning!"
Wow, that's a lot to respond to, but I'll keep this brief.

Like I said in a previous post, it usually but not always Liberals who vilify the rich and cultivate the us VS them mentality. For example, well this is more a Democrat VS Republican debate, but I love how almost all tax cuts purposed or passed by Republicans are characterized as tax cuts for the wealthy by the Democrats.

And as for what I believe constitutes fair tax practices, I want a flat tax. I don't believe the current system where the wealthiest 10 percent pay 59 percent of all income taxes is fair.

sqweels
01-04-2004, 09:31 PM
You know, people, another reason liberals aren't communists is that they focus on other issues besides economic policy. Having said that, I'll reiterate that opposition to tax cuts for the rich can also be in the name of fiscal discipline, rather than a pitting of the lower class against the rich. There is a wide range of social goods that fiscal policy can support, including smaller tax cuts but also a principled paying down of the national debt, or maybe investment in things like alternative energy. (Does this approach make me a "liberal"? You decide.) It's also worth pinting out that if you support, for example, school vouchers, you are a socialist. You're not as big a socialist as someone who supports the current system but a bigger one than someone who would eliminate tax-funded education altogether.

But indeed there are other sets of issues that concern liberalism and how we define it. Race is one of the cornerstone issues, but in recent years it has presented us with a severe paradox as it plays out. My brand of liberalism is considerably at odds with polictical correctness. The belief in "systemic racism" has become like a religion--with a witch-hunt mentality. There is a great deal of strictness over expression that might be construed as "profane" in its own way. Minority activists have learned that playing up victimism is a source of power, and there's a belief that belonging to a particular entitles you to certain privleges. In short the racial left, even as it is positioned several of these "steps" in the "direction" of communism, has come to resemble a form of conservatism. So does being liberal on race mean you favor color blindness, etc.--which had obvious implications back in the 60's-- or does it mean always favoring minority groups both economicaly and in the cultural sensitivty department?

But to me, the first world in liberalism is sex. "The personal is political" was a catchphrase of the 60's counterculture that acknowledged the implications of challenging the traditional conservative prohibition on premarital sex (among a lot of other things). Communist regimes tended to be very prudish and disdainful of "bourgeois" decadance. Here, it is religious hackles that are raised by liberal positions on sexual and reproductive issues. Some go so far as to portray them--especially homosexuality-- as an attack on religion. Combine this with the more "blatant" attack on religion represented by church-state issues, and it's easy to associate liberalism with communism's official atheism. This is unfair, for although any modernist reform movement will de-emphasize religion, liberals embrace religious tolerance and diversity, and allow for unfettered religious expression so long as it's confined to the private sector. In so doing they face off against the dominance of one particular religion, Christianity. Communism regards religion in general as standing in the way of its agenda to totally remake society, something to be eliminated or at best, grudgingly accomodated out of political expediency.

deadeyesdad:
Probably from where Conservatism=Fascism comes from. Mindless insults to make your point of view look better.

This response was all too predictable, but while the epithet "fascist" was grossly overused during the Vietnam era, I seldom heard it during the 80's and 90's while liberals were still being called communists and socialists. And while communists either take over the government and completely re-order society or fail to do so, fascism can be said to exist at a low level. It can just be a nasty attitude on the part of right-wingers--"patriotic correctness" if you will. Calling someone a "traitor" for disagreeing with the Bush Administration qualifies. Accusations of fascism can be prertty much summed up as a backlash to the backlash to the Dixie Chicks' backlash to the backlash to 9/11.

pervert
01-04-2004, 09:47 PM
Originally posted by sqweels
Combine this with the more "blatant" attack on religion represented by church-state issues, and it's easy to associate liberalism with communism's official atheism. This is unfair, for although any modernist reform movement will de-emphasize religion, liberals embrace religious tolerance and diversity, and allow for unfettered religious expression so long as it's confined to the private sector.
I have a small nit pick with this argument. I should say that I agree with the principle that religion should be kept to private property. Many liberal policies, however, also seek to increase the number of non private property. That is, they seek to increase the functions of government. As I'v said before, equating them with comunism misses essential characteristics of both philosophies. But as far as assigning tendencies of communism or socialism to liberalism goes, including this tendency to want religion removed from public spaces as an example of "anti religiousness" is not too far fetched.

That was horribly unclear. Let me summarize. IF you believe that liberals want to increase the functions of government. IF you believe that liberals want to remove religion from the properties used for these functions. THEN a characterization of the anti religious liberal has some validity.

I really hate the seperation of church and state debate. It makes me admit I am an athiest who believes in school prayer. Very sad. :(

jshore
01-04-2004, 10:53 PM
Originally posted by Joel
And as for what I believe constitutes fair tax practices, I want a flat tax. I don't believe the current system where the wealthiest 10 percent pay 59 percent of all income taxes is fair.

Well, I hate to disappoint you but a flat tax will only lower that percentage to ~43% since that is their share of the income (AGI). Of course, if we institute a flat tax and don't reform state taxes (or other federal taxes if you aren't including them) then what you will end up with is a regressive tax structure where the rich pay a smaller percentage of their income in taxes than the poor do. How you would justify that, I don't know.

As for vilifying the rich, you clearly weren't around a year or two ago when we were arguing a lot about the estate tax and I was trotting out arguments from Warren Buffet, Bill Gates Sr., and other folks associated with Responsible Wealth (http://www.responsiblewealth.org/). I mean I admit that we liberals might sound a bit anti-rich when we argue against public policies that mainly benefit them but that ain't nothing compared the vitriol that a few people on the Right seemed to express for rich people who also happened to have left-wing views in regards to tax policy and such!

Nobody
01-04-2004, 11:51 PM
Originally posted by jshore
Well, I hate to disappoint you but a flat tax will only lower that percentage to ~43% since that is their share of the income (AGI).
I'm curious to know where you got that figure from. And I don't mean that in a, I think that you're full of BS, type way, I'm just genuinely curious.

Of course, if we institute a flat tax and don't reform state taxes (or other federal taxes if you aren't including them) then what you will end up with is a regressive tax structure where the rich pay a smaller percentage of their income in taxes than the poor do. How you would justify that, I don't know.
How do you get a regressive tax out of a flat tax? With a flat tax, you would still have a system of paying more taxes the more that you make.

As for vilifying the rich, you clearly weren't around a year or two ago when we were arguing a lot about the estate tax and I was trotting out arguments from Warren Buffet, Bill Gates Sr., and other folks associated with Responsible Wealth (http://www.responsiblewealth.org/).
I was around, but I guess I missed out on the debate.

I mean I admit that we liberals might sound a bit anti-rich when we argue against public policies that mainly benefit them
No, what makes you guys sound anti-rich is when you take things that don't mainly benefit the rich, and say that they do. For example, if I didn't mention it allready, calling basically all republican tax cuts, tax cuts for the rich, and then justifying it by using a low standard for what constitutes being rich. Also, Democrats and Liberals seem to allways have the opinion that the rich are never paying their fair share and that they should pay more.

but that ain't nothing compared the vitriol that a few people on the Right seemed to express for rich people who also happened to have left-wing views in regards to tax policy and such!
Bolding mine, obviously. Yes, a few on the right have expressed vitriol for rich left wingers. But that's only a few, not the majority.

Evil Captor
01-05-2004, 12:03 AM
As to the OP, one point that hasn't been brought up to date is that liberal equating with conservative is the result of a successful propaganda campaign by conservatives. Since the 1980s some conservatives have deliberately attacked liberalism as being essentially communism. The reason some people equate liberalism with communism is that conservative ideologues and conservative media have consciously and deliberately pushed this notion. That's why most politicians to the left of center identify themselves as progressives -- the conservative propaganda campaign has been very effective.

adaher
01-05-2004, 12:29 AM
Progressive is more accurate anyway. Liberal's dictionary meaning is a lot closer to libertarianism.

Obviously, most American "liberals" are not socialists or communists, since they favor democracy and the free market, albeit a heavily regulated free market. Progressive or social democrat fits a lot better than liberal.

jshore
01-05-2004, 09:16 PM
Originally posted by Joel
I'm curious to know where you got that figure from. And I don't mean that in a, I think that you're full of BS, type way, I'm just genuinely curious.

See the "Adjusted Gross Income Shares" table here (http://www.taxfoundation.org/prtopincometable.html). (By the way, The Tax Foundation is actually a right-of-center group, as is apparent from their commentary page. But, this page of tables is basically direct from the IRS, and as far as I can tell, quite reliable.)


How do you get a regressive tax out of a flat tax? With a flat tax, you would still have a system of paying more taxes the more that you make.

My statement was that the flat tax alone would be neither progressive or regressive. (Well, a truly flat tax would be anyway...Depending on what sort of standard deduction you put in, you can make a "flat tax" progressive, at least to some degree.) However, if you don't reform federal payroll taxes and state and local taxes at the same time that you put in a flat tax to replace the federal income tax, then the overall tax structure would be regressive. (Again, that is definitely true only for a true "flat tax" with no deduction.)

However, I also have the feeling from your statement here that you may not understand the definitions of "progressive", "neutral" or "flat", and "regressive" in regards to taxation. A tax is neutral or flat if it takes the same percentage of income from all people. If it takes a higher percentage from wealthier people then it is progressive. If it takes a higher percentage from poorer people then it is regressive. Note that the definitions are in terms of percentages and not absolute dollar amounts.


No, what makes you guys sound anti-rich is when you take things that don't mainly benefit the rich, and say that they do.

Well, when you have about 40 cents on the dollar going to the top 1% of income earners, then I think it is not too incorrect to say the tax cut mainly benefits the rich. When you add in issues of state and local taxes being simultaneously raised while the federal income tax is lowered (in a development that I would argue is not entirely unrelated to the federal income tax being lowered in preference to doing other things with the money like helping states financially meet some of the federally-mandated spending) and also consider what government services seem most likely to go on the chopping block, then I think one is quite safe in claiming that most of the net benefits will accrue to the rich.


Also, Democrats and Liberals seem to allways have the opinion that the rich are never paying their fair share and that they should pay more.

This does not mean that they are anti-rich. While I don't consider myself rich, I am quite well-off and I include myself among the class of people who I don't believe need to have their taxes cut. In fact, there are many cases in which I would support a tax increase on myself (and I certainly support the repeal of the Bush tax cut on myself). By your logic, I suppose this would make me a self-hating "well off" person. Bill Gates Sr., Edward Kennedy, and many of the Democratic candidates (Kerry for sure) would safely fall into the category of self-hating very-rich people. I choose to see these people as enlightened rather than self-hating.

dropzone
01-06-2004, 12:37 PM
Originally posted by Joel
I'm talking about things like sometimes schools having to be sued because they allow secular after school groups but not religious after school groups.But those lawsuits were necessary because school administrators were unfamiliar with the limits of the separation of church and state and were unwilling to accept that it is perfectly within the bounds of the Constitution for religious student groups to use the school if secular student groups could. Liberals should not be tarred with the brush brush of religious intolerance because some school administrators of unknown politics erred on the side of overcaution because they are ignorant and stubborn.

sqweels
01-06-2004, 06:17 PM
pervert:
IF you believe that liberals want to increase the functions of government. IF you believe that liberals want to remove religion from the properties used for these functions. THEN a characterization of the anti religious liberal has some validity.

I don't think liberals want to increase the size and functions of government purely for the sake of it. Rather, it's the Right's way of characterizing the sum total of liberal polices over the course of the 60's and 70's. Lately liberals have just been holding the line against the Right's efforts to privatize everything or cut their funding. I can't think of a lot of examples of liberal-led government taking over the property of private institutions, let alone with the intent or effect of eliminating religious expression therein. (OTOH, the Catholic Church has been taking over hospitals and eliminating abortion services). I think your point is too much of a stretch.

I will say that liberals have a lesser regard for religion since liberalism is about re-thinking our values from a more intellectial point of view. Religion is bound to lose a few credibility points. And the fact that many religious folks have made themselves out to be unholy busybodies doesn't help.

jadagul
01-06-2004, 09:08 PM
Though this doesn't apply to modern American political labels, the actual, 'dictionary' definitions of 'liberal' and 'conservative' can be quite instructive. 'Liberal' originally referred to someone who believed in freedom (hence 'liberal,' from 'liberty'), limited government action, challenging the status quo, and rationalism. 'Convervative' meant someone interested in preserving the status quo and the power of the elites; rather than taking a specific stand on government action in general, it would support government action just so far as the government perpetuated the status quo. Thus, at the far 'liberal' end of the spectrum, you have radical libertarians, like me, who doubt the usefulness of government at all (I accept police/army/court as necessary, but don't like it and consider the whole idea at best questionable, ethically). On the far conservative side you have a group much harder to classify in modern American politics. Originally those who supported the king and landed elite, they're now those who support keeping wealth where it is (protecting people who are already wealthy, hindering others from becoming wealthy) or wish to impose some form of social mores (whether the social mores of believing in God or the social mores of charity. Without rendering judgment on the desirability of either, or the extent to which they're advocated, promoting either would be an example of trying to maintain a traditional social structure). As best as I can tell, under these definitions, both major parties are fairly conservative; socialism and communism can be either but tend towards conservatism. Reasons (once again, I'll try to classify positions without judging; but I am libertarian, and can't divorce that entirely from my tone):

Democrats and Republicans are wealth-wise conservative in different ways, but both exhibit it (they also have a liberal side, of course; private property, individual rights, social mobility. As such, they're more middle-of-the-road than a true conservative position, which really doesn't exist in America. To find one, look at feudalism, absolute monarchy, or theocracy). Both support licensing of certain industries/businesses, for instance; this preserves the position of those already in the industry and protects them from new competition and fresh blood. Similarly, trade protectionism protects domestic industry from foreign competition. Republicans obviously try to uphold traditional social mores with regard to family, God and country; Democrats, less obviously, tend to enforce traditional morals like a belief in the justice and necessity of charity. Also, both parties favor special protections for certain minority groups. This is easy to point to for Democrats (racial, gender, sexuality, etc.); it's less obvious for Republicans, but owners of major businesses and their heirs are certainly in the minority. All of these protections allocate to the protected a certain social place protected by law. Breaks to business (which are supported by both sides, though more by Republicans--agricultural subsidies over the last half-century have been bipartisan) allow old businesses to continue in prosperity, and racial protections (at this point--they may have been liberal when first envisioned) preserve the protected status of minorities. Finally, trade regulation was a hugely conservative idea. The ICC--the first major federal regulation--took off, not when populist farmers advocated it, but when the railroad bureaus jumped in. The railroad barons realized that a regulatory bureau could be used to squash newcomers and preserve their status. Once the ICC was set up, the populist reformers moved on; the railroaders got control, and they've used the committee to restrict and limit new forms of competition (airplanes and trucks, mainly) ever since. The original idea was to crush the railroad monopoly; when technology arrived that would do that naturally, the railroads could protect themselves through that regulatory agent. Finally--as Milton Friedman pointed out in Capitalism and Freedom, much to my amusement, a progressive income tax is generally a conservative force. It doesn't tax people with more money--it taxes people with more income. Thus, it makes it harder for Steve Jobs or Warren Buffet to earn his fortune, but doesn't prevent a Hearst from hanging on to his. It doesn't destroy the fortunes of the already-rich, but it makes it harder to join their company.

Socialism: certainly can be used to promote liberalism, but is usually a conservative force. Most of the ideas I covered above apply to socialism, only more so--regulatory boards make it harder to challenge old businesses, government control makes it harder to challenge established order. Socialism tends to add a few additional troubles, though; first, because the government is the only source of employment, it's hard to contradict it. It would have to be an incredibly principled government that would give a nice, cushy job to someone who opposed that government; even if it did, there's still not a significant amount of money lying around to fund radical movements. If the government chooses to fund radical movements, it will be faced with a number of them that no one cares about, but that are founded because the founder wants governmental monies. In a free-market system, concentrations of wealth exist apart from the government, and can fund opposition groups and ideals; it seems there's no idea so radical or ridiculous it can't find some funding somewhere. Further, though socialism may appear to destroy class by eliminating wealth, it usually replaces one class with another. Travel writer and political humorist PJ O'Rourke noted in socialist Sweden that even when people had similar incomes, perks differentiated classes: who gets the corner office? Who gets the trips to conferences? Who gets the trip to the week-long Pan-European Conference of Something-Or-Other and stay in the hotel resort (not that all conferences are worthless and held in hotel resorts, only that those that are can be used as incentives. We send the flunkies to the hell weeks). Thus socialism maintains class even when it appears not to. Finally, this type of class is harder to challenge. In capitalism, someone always has the potential to change class either by coming up with a great idea that makes tons of money, or paying for a lot of stupid ones that bleed money. Under socialism, people are less vulnerable to the market, and more likely to stay where they were at birth. Still socialism embraces liberal ideals in concept--freedom of individuals, individual rights, and a rationalistic government--and its appeal is mostly founded on liberal ideas.

Communism: Maybe the most complicated. Communism was created as a liberal philosophy, a revolt against stable families of 'old money.' By eliminating money, Communism says, we create a system where all are free to pursue their own good, and no one is held back by wealth or class. In this sense, communism is liberal. I've heard allegations (link to big article expousing same ideas I propose here) that Lenin returned to the Soviet Union to try to reclaim the liberal side of Communism, and would have implemented a fairly capitalist economy had he lived. However, Communism can also exist as a conservative force. The main concern of Stalin's regime was self-maintnance: Stalin had power, and his system was designed to keep it for himself. Thus, Communism as it was actually practiced in the USSR was quite conservative. It created a regime of oppression, unlimited government, and tyrrany, and perpetuated this regime through force and propaganda. Communism can ideologically lean liberal, but is generally implemented conservatively.

jshore
01-06-2004, 09:39 PM
Originally posted by jadagul
Finally--as Milton Friedman pointed out in Capitalism and Freedom, much to my amusement, a progressive income tax is generally a conservative force. It doesn't tax people with more money--it taxes people with more income. Thus, it makes it harder for Steve Jobs or Warren Buffet to earn his fortune, but doesn't prevent a Hearst from hanging on to his. It doesn't destroy the fortunes of the already-rich, but it makes it harder to join their company.

Cute argument but I think it may be largely specious for a variety of reasons:

(1) The big thing about money is that it is much easier to earn it if you already have it. Most wealthy people get most of their income from investments (look at GW Bush's tax returns...although I have to admit that the ones I saw were from healthier times in the stock market before he actually became President). Of course, if you do get rid of taxes on investment income and get rid of the estate tax, you are going a long way in this direction of totally laying off of taxing the wealth, as well as further income generated from it, but otherwise you are not.

(2) Unless the marginal tax rates get a lot higher, I fail to see how it does much to inhibit people from becoming rich. Maybe in the days when there were marginal rates up to 90%...But, in those days there were apparently a lot of loopholes too.

(3) As a point of record, I would claim those who support more progressive taxes on income almost always support the estate tax and those who support less progressive taxes on income almost always don't. So, those identified as "conservative" are opposing the taxation of accumulated wealth in addition to the taxation of high incomes.

jadagul
01-06-2004, 10:30 PM
Jshore, all you say is true, but doesn't affect the core argument, though it certainly helps protect current political parties from a certain amount of blame. (1) is true, but doesn't really mean much. I'll gladly grant that a high income tax rate hurts people who are rich already. But it doesn't make them less rich, only inhibits their becoming more so. It's a tax on further earned wealth, and on interest on the original wealth, but the chunk that's just sitting in the bank isn't affected at all. People with large amounts of money but low incomes (heirs, retired persons who saved up) aren't affected much by high income taxes. People with high incomes and low savings, on the other hand, are harder hit. These are the people who are currently working and achieving things, people trying to move up in the world. Thus, to a certain extent high tax rates are stabilizing because they make it much harder to acquire wealth, but not much harder to retain wealth already gained (taxes on investment income aren't over 100%, so something's left over. The tax on its own won't eat into savings).

(2) only mitigates the argument in terms of current political reality. Sure, it would be harder to acquire wealth if the tax rate were raised; it would be easier if the rate were lowered. A small income tax makes it slightly harder to accumulate wealth, and is a slight stabilizing influence. A high income tax makes it much harder to accumulate wealth, and is a strong stabilizing influence. A 100% income tax makes it impossible to accumulate wealth, and represents a huge stabilization (if you ignore social upheval from people no longer having incentive to work; that's a completely different argument, has nothing to do with this topic, and no one advocates that anyway). You simply point out we're pursuing a moderate policy, which is true; Democrats and Republicans aren't incredibly conservative. Our income tax is only somewhat conservative; it's still a somewhat conservative influence.

(3) is totally true, but doesn't bear on the question of whether income taxes are conservative ( I assume you're talking in your post about Democrats and Republicans. One party is more liberal on some issues, the other on others. I was just pointing out one conservative policy they both support to some degree). Inheritance taxes are a mix between conservatism and liberalism. They're liberal in trying to 'level the playing field' and 'challenge the status quo.' They're illiberal, and thus, I suppose, conservative, in granting more power to the government (a liberal ideal is individual rights--in this case, the individual's right to decide what to do with his money. Another liberal ideal is limited government. We tend to pursue, in actuality, a confused course, sometimes very liberal, sometimes very conservative, sometimes using conservative methods toward liberal goals). The income tax, on the other hand, is wholly conservative, if you disregard the possible liberality of the way it's spent. I think the main reason Democrats and Conservatives disagree on this issue has more to do with perspective on government size than on the limitation of wealth accumulation; thus, the Democrats want to expand certain programs and pay with taxes, whether they're inheritance taxes or income taxes.

Finally, I forgot to include the link I promised in my last post, so here it is: Article on the History of 'liberal.' (http://www.mises.org/journals/lar/pdfs/1_1/1_1_2.pdf) It's written by a radical libertarian (and liberal, in these definitions) historian who chronicles the history of the liberal ideal. Interesting reading--at least to me.

Nobody
01-06-2004, 11:12 PM
I posted a reply earlier, but I see that the hamsters ate it, so I'll try again. There's only three points I felt like replying to.
First:
Originally posted by jshore
See the "Adjusted Gross Income Shares" table here (http://www.taxfoundation.org/prtopincometable.html). (By the way, The Tax Foundation is actually a right-of-center group, as is apparent from their commentary page. But, this page of tables is basically direct from the IRS, and as far as I can tell, quite reliable.)
Thanks for the link.

Second:
However, I also have the feeling from your statement here that you may not understand the definitions of "progressive", "neutral" or "flat", and "regressive" in regards to taxation. A tax is neutral or flat if it takes the same percentage of income from all people. If it takes a higher percentage from wealthier people then it is progressive. If it takes a higher percentage from poorer people then it is regressive. Note that the definitions are in terms of percentages and not absolute dollar amounts.
Before I accuse you of insulting my intelligence, I'll just assume that you misunderstood what I said and try to restate it more clearly.
With a flat tax, even though the percentage is the same, it's still a system of, the more you make, the more you pay. Pretend for the sake of this argument that a 20% flat tax is used. 20% of $20,000 will still be less than 20% of $50,000. Even though the percentage would be the same, you would still pay more in taxes the more that you made.

And third:
This does not mean that they are anti-rich. While I don't consider myself rich, I am quite well-off and I include myself among the class of people who I don't believe need to have their taxes cut. In fact, there are many cases in which I would support a tax increase on myself (and I certainly support the repeal of the Bush tax cut on myself). By your logic, I suppose this would make me a self-hating "well off" person. Bill Gates Sr., Edward Kennedy, and many of the Democratic candidates (Kerry for sure) would safely fall into the category of self-hating very-rich people. I choose to see these people as enlightened rather than self-hating.
OK, it appears to me that you're putting words in my mouth. Thanks.
I don't think that well off people who want higher taxes are self hating, I just think that their ideology is incorrect.
And what the hell is so enlightening about wanting higher taxes? And does that mean that there's something wrong with people who want lower taxes? We're unenlightened then?
See, this is what I mean about most Liberals turning to the government as the answer most of life's problems.
If you feel that not enough poor, disabled, or otherwise needy people aren't getting the food, clothing, shelter, etc... that they deserve, there are private charities you can give to.
This doesn't mean, however, that I'm against government programs to help people who can't help themselves.

Nobody
01-06-2004, 11:20 PM
Originally posted by dropzone
But those lawsuits were necessary because school administrators were unfamiliar with the limits of the separation of church and state and were unwilling to accept that it is perfectly within the bounds of the Constitution for religious student groups to use the school if secular student groups could. Liberals should not be tarred with the brush brush of religious intolerance because some school administrators of unknown politics erred on the side of overcaution because they are ignorant and stubborn.
You do make an excellent point about the political affiliation of the school administrators being unknown, and I try not to paint all Liberals with a broad brush stroke of religious intolerance. I apologize if I gave you that impression.

jshore
01-06-2004, 11:30 PM
Originally posted by Joel
Before I accuse you of insulting my intelligence, I'll just assume that you misunderstood what I said and try to restate it more clearly.
With a flat tax, even though the percentage is the same, it's still a system of, the more you make, the more you pay. Pretend for the sake of this argument that a 20% flat tax is used. 20% of $20,000 will still be less than 20% of $50,000. Even though the percentage would be the same, you would still pay more in taxes the more that you made.

Yes, this is true, but what I was responding to was your statement:


How do you get a regressive tax out of a flat tax? With a flat tax, you would still have a system of paying more taxes the more that you make.


I don't know how to read this statement other than as implicitly expressing the idea that a tax can't be regressive if higher-earning people pay more dollars taxes than lower-earning people. This is not true. (And, a tax where everyone paid the same dollar amount would be very regressive indeed!)


And what the hell is so enlightening about wanting higher taxes? And does that mean that there's something wrong with people who want lower taxes? We're unenlightened then?


Well, obviously enlightenment is in the eyes of the beholder. But, if you want to know the sense in which I behold enlightenment, try these two attitudes on for size:

Warren Buffett, Bill Gates Sr., etc. (paraphrasing): I managed to make a lot of money because society has been very good to me, providing me with lots of benefits and rewarding me very highly for the talents that I have. Thus, I owe a lot back to that society and have no problem with progressive taxation and estate taxes.

Dick Cheney: "...And the government had nothing to do with it."

I consider one of these attitudes to be very enlightened and the other to be very unenlightened. It doesn't have to do with "wanting higher taxes" so much as it has to due with acknowledging one's debt to society and not having an exaggerated sense of one's own self-importance and self-worth just because one has a high net worth.

Nobody
01-06-2004, 11:53 PM
Originally posted by jshore
Well, obviously enlightenment is in the eyes of the beholder. But, if you want to know the sense in which I behold enlightenment, try these two attitudes on for size:

Warren Buffett, Bill Gates Sr., etc. (paraphrasing): I managed to make a lot of money because society has been very good to me, providing me with lots of benefits and rewarding me very highly for the talents that I have. Thus, I owe a lot back to that society and have no problem with progressive taxation and estate taxes.

Dick Cheney: "...And the government had nothing to do with it."

I consider one of these attitudes to be very enlightened and the other to be very unenlightened. It doesn't have to do with "wanting higher taxes" so much as it has to due with acknowledging one's debt to society and not having an exaggerated sense of one's own self-importance and self-worth just because one has a high net worth.
I believe that if you feel that you owe a certain amount of money to society, then go ahead, pay it. Give to your favorite charities, pay people directly, support certain buisnesses and organizations. That's a wonderful thing. But by wanting higher taxes, you're forcing others to pay as well. It is a lot more nobel and enlightened to willing pay yourself, than it is to force others to pay.
Also, how much do you think that government contributes to peoples success? Say I started my own buisness. I would have to pay for permits, licences, etc. The government would tax the profits that I made and the income that I would pay my employees. So far, this seems to have nothing to do with contributing to my success. Yes, there may be government loans that I could probably get, but other then paying them back, what else would I owe the government for?

Nobody
01-06-2004, 11:56 PM
It is a lot more nobel and enlightened to willing pay yourself, than it is to force others to pay.
should read
It is a lot more nobel and enlightened to willingly pay yourself, than it is to force others to pay.

spectrum
01-07-2004, 12:09 PM
Originally posted by Joel
Also, how much do you think that government contributes to peoples success?

A great deal.

Say I started my own buisness. I would have to pay for permits, licences, etc. The government would tax the profits that I made and the income that I would pay my employees. So far, this seems to have nothing to do with contributing to my success. Yes, there may be government loans that I could probably get, but other then paying them back, what else would I owe the government for?

The government created or is a primary force behind the stable social fabric, the social safety network, the services in terms of police and fire protection, the stable currency, the general prosperity, the defense from foreign invasion, the roads and utilities, and the education that made it possible for your business to exist and succeed. And those are just some of the more obvious and tangible things the government provides.

spectrum
01-07-2004, 12:16 PM
Originally posted by Joel
How do you get a regressive tax out of a flat tax? With a flat tax, you would still have a system of paying more taxes the more that you make.

Moving to a flat tax would be a highly regressive move, because it would throw massive tax burdens on the poor and lower middle class, who cannot afford to pay them.

Someone making $20,000 cannot afford to pay $4,000 in federal income tax. That would be a crushing burden.

Though, a person making $2,000,000 could pay his $400,000 without batting an eye.

So what a flat tax does is make life much harder on the poor, and much easier on the rich: ie, transferring hardship to those who can't bear it from those who were never really all that burdened in the first place.

The fact of the matter is that taxes should be paid by those who can afford to pay them, and the burdened should be balanced so that it falls on those who won't be cast into poverty by a high tax burden.

The rich already get a pretty much free ride on Medicare taxes. Funny, you don't hear wealthy folks trying to get those taxes made "flat."

dropzone
01-07-2004, 01:29 PM
When Steve Forbes was running for president I figured out what my taxes would be under his flat tax program. Twice what I actually paid.

Folks at our end of the financial spectrum should do some simple arithmetic before they get on board with any idea pushed by folks at the other end.

Liberal
01-07-2004, 03:36 PM
I think the idea originally came from the liberal proclivity toward large government and advocacy of wealth redistribution (i.e., heavy taxation and expenditures on public welfare). Wealth redistribution is a core principle of Marxism. But nowadays, there isn't a dime's worth of difference between liberals and conservatives in that regard. The Bush administration has busted all the spending records and has add a whole new cabinet level department. (As did Nixon).

jshore
01-07-2004, 04:30 PM
Originally posted by Joel
I believe that if you feel that you owe a certain amount of money to society, then go ahead, pay it. Give to your favorite charities, pay people directly, support certain buisnesses and organizations. That's a wonderful thing. But by wanting higher taxes, you're forcing others to pay as well. It is a lot more nobel and enlightened to willing pay yourself, than it is to force others to pay.

Well, I don't find this a very compelling argument. The fact is that we are all in this together and we have to find the best way to structure our society. And, my extra few thousand dollars isn't going to make much of a difference.

And, while you may feel "forced" to pay your taxes to the government, there are other things that forced upon us by this standard...For example, we are forced to live in a society where corporate law is written the way it is. These laws did not come from on-high you know. And, I for one believe that one of the trade-offs that I find necessary in a society where corporations are granted the benefits that they are, allowing the immense concentration of wealth, is to have at least a somewhat progressively-structured tax system.


Also, how much do you think that government contributes to peoples success? Say I started my own buisness. I would have to pay for permits, licences, etc. The government would tax the profits that I made and the income that I would pay my employees. So far, this seems to have nothing to do with contributing to my success. Yes, there may be government loans that I could probably get, but other then paying them back, what else would I owe the government for?

Spectrum answered this well. I'd only add that the government is the enforcer of corporate law and of property and intellectual property rights...These ain't small potatoes. Do you honestly believe that Bill Gates could accumulate even 1/100 of the wealth he has managed to accumulate without the trappings of our society...i.e., within some sort of state-of-nature?

I also agree with Spectrum's point that progressive taxation can also be justified by arguments involving "least pain"...I.e., we have to raise the money for government functions somehow so how do we raise it in a way that produces the least pain. I think this sort of consideration would actually lead to a way more progressive tax structure than we have now (in fact, practically confiscatory at the top), but I think it has to be weighed against other considerations (such as having reasonable incentives for people to work harder, for example).

Originally posted by Libertarian
...advocacy of wealth redistribution...


Once we dispense with anarchy, any government policy is going to have distributive impacts even a libertarian one. What seems to me to separate liberals from conservatives is that conservatives don't question those policies that allow for the immense concentration of wealth...i.e., wealth getting redistributed upward, but complain about any government functions that tend to counteract this by redistributing wealth downward.

Lissa
01-07-2004, 04:30 PM
Originally posted by Joel
I believe that if you feel that you owe a certain amount of money to society, then go ahead, pay it. Give to your favorite charities, pay people directly, support certain buisnesses and organizations. That's a wonderful thing. But by wanting higher taxes, you're forcing others to pay as well. It is a lot more nobel and enlightened to willing pay yourself, than it is to force others to pay.

There once was a time in which the poor depended on the charity of the willing. They starved to death in the streets.

Frankly, those willing to make significant contributions to charity are few, and the problem is great. If you look at countries with no social safety net, you don't see the wealthy stepping forward en masse to save the starving children.

AHunter3
01-07-2004, 05:13 PM
Joel: I believe that if you feel that you owe a certain amount of money to society, then go ahead, pay it. Give to your favorite charities, pay people directly, support certain buisnesses and organizations. That's a wonderful thing. But by wanting higher taxes, you're forcing others to pay as well. It is a lot more nobel and enlightened to willing pay yourself, than it is to force others to pay.

The printing of money, and the maintaining of money as a currency of exchange, is a function of government. It's not a resource you own in and of yourself. The government which causes your money to exist may choose to tax some of it. If you don't believe you should have to contribute to the common good (that being determined by representatives you helped elect, at least in theory), maybe you should withdraw from participating in ventures that involve money. I can't promise that you can live tax-free if you do everything according to barter, but it seems possible.

sqweels
01-07-2004, 07:18 PM
Question: When we speak of 'resdistribution of wealth' do we mean things like Social Security and Medicare/Medicaid, which are these gargantuan Federal programs, or just direct welfare to the able-bodied poor. That kind of thing is mainly on the state level, but can we get some idea of how much of our tax burden goes to programs that can readily be replaced by these charities being touted? Would that include the schools, etc?

pervert
01-07-2004, 07:46 PM
spectrumDoes not the government run infrastructure benifit everyone? Does the army somehow benifit businesses more than other citizens?

jshoreWell, your thousand dollars might not make much of a difference, but do you contribute it? The point is not to cast aspersions on your generosity. The point is simply to point out that if others sometimes question whether liberals are generous or simply want to tax more there may be a reason.

LissaDo you have any credible sources to back up these assertions? Can you point to a historical tally of the number of starvation deaths before welfare? Are any of the countries you mention as lacking a safety net rich enough to afford one?

AHunter3 As you question why some people link liberalism with communism re read your post and see how close you come to suggesting that since money is printed by the government that all wealth really belongs to the people.

sqweelsIf I am not mistaken, when we talk about wealth redistribution we are talking about all of the programs you mentioned. I would add regressive income taxes as well. While welfare is mostly administered by the states, it does constitute a pretty large amount of the federal budget. If I'm not mistaken, one of jshore's links had this information.

Guinastasia
01-07-2004, 08:39 PM
Cecil on the flat tax (http://www.straightdope.com/classics/a5_139.html).

He said it is, and I quote, "the stupidest idea to come down the pike since pet rocks."

sqweels
01-07-2004, 08:42 PM
Yes, Pervert, but there's a difference between providing soup to the homeless and providing healthcare to the elderly. What I want to know is, which budget items are being targeted for replacement by the charities people are going to shower money on once their taxes are cut and what percentage of the average taxpayers bill will be cut so we can do that?

AHunter3
01-07-2004, 09:04 PM
pervert: AHunter3 As you question why some people link liberalism with communism re read your post and see how close you come to suggesting that since money is printed by the government that all wealth really belongs to the people.

Money isn't wealth. Money is a representation of wealth. This isn't communism -- if our government starts doing sufficiently irritating things with the money it keeps unto itself, we have the right to pick up our marbles and go home. Or, better yet, we can tell them to pick up their marbles and go home.

But to say "I don't see why any of my money should be collected as taxes" is to say to the rest of us "I don't see why I should contribute to the national defense, the maintenance of highways, education for our children, or even the ink and electricity used to print money at the US mint".

And that's you picking up your marbles and not going home. Excuse me, I think you're standing on the taxpayers' sidewalk. If you aren't going to ante up and pay the piper on the commons, I think you should leave.

(Now, if you want to argue that you have not been adequately represented, that's coming at it from a different angle. We have a "no taxation without representation" tradition, after all. But if you think the system is adequately democratic and the government duly elected by a process that gives you a fair and equal slice of the decision-making pie, I don't think you have much excuse for not supplying the tax burden levied by your elected governors for the purpose of pursuing projects on behalf of the public good.)

pervert
01-07-2004, 09:35 PM
Well, there are a lot of ways to implement the budget cuts we are talking about. The biggest problem is that we have this hyperbolic argument between liberals and conservatives where each side assumes the other wants to ruin the country. If you look at the Congressional Budget Office Historical Data (http://www.cbo.gov/showdoc.cfm?index=1821&sequence=0) you have well over half of our 2 trillion dollar budget going to entitlements and "other manditory spending" programs. Unless you can find some numbers indicating that social security and medicare expenses go to predominantly to well off seniors we have a very sizeable portion of our budget going to these programs.

The first question to answer when looking to replace all this govenrment spending is not where will the money come from, but how much of this money really needs to be spent. Do you have any good critics of Social Security or Welfare showing how much of the money really goes to help people and how much of it is merely enabling? That is, how many people would need this money if it weren't there?

But let's assume that a similar amount of money would need to be collected. I'm going to make up a couple guesses. Let's say that 50% of Social Security and 50% of Medicare can be put into the same category as welfare expenditures in terms of wealth transfer. So (fromt he link above) Means tested expenses:286.1 billion, social security:452.4 (226.2) billion, Medicare:$253.7 (126.85) billion, Disability:96.1 billion, and Unemployment: 50.6 billion. These numbers are from 2002 and I will ignore the rest of the mandatory expenditures and only use the half figures for SS and MC. So we have a total of 785.85 billion dollars. This amounts to about 39% of the 2011.0 billion spent that year.

So, as a quick back of the napkin sort of calculation, let's reduce taxes by 39%. This also amounted to 7.81 percent of GDP, BTW. Now, of course, I did not look at the overhead for distributing this money. I'm sure all the numbers are rounded.

I can't find a good cite for how much Americans give to charities that would qualify to take over these functions. Hoepfully someone better at googling can fill this in for us. But as a first suggestion, what if we created an additional charity classification. Certain charities which do the sorts of things we are talking about. Then we change the tax break you get for giving to these charities such that the amount comes off of your taxes instead of your taxable income. I know some states have done this with certain education donations to good effect.

I'm not trying to provide a sound argument for the dismantling of social spending in such a limited space. I'm merely trying to point out that the situation is far more complicated than "the government must do it or people will starve" mantra. The point being that if liberals were truly motivated by helping the poor (as opposed to increasing the size of government and therby their own power) then they would be much more willing to discuss the possibility of privatizing them.

Just for the record, I'm not trying to paint all liberals with this brush. I'm merely parroting a common conservative view that liberals may be more interested in using the issues of aid to the poor as a political tool. And that this is one of the reasons liberals are often linked (tenuously and perhaps wrongly) with communism.

pervert
01-07-2004, 09:42 PM
Well, AHunter3, I don't think anyone is arguing that the government should not be paid for. We are simply arguing over what sorts of things the government should spend money on. Even that only in the context of why some people link liberals with communists. I'm certainly not arguing either point. I'm merely pointing out that there is a "certain logic" in the link drawn between liberalism and communism. I put certain logic in quotes because I have said that the link is not sell defined or easily defensible. It is simply self consistant.

Lissa
01-08-2004, 12:45 AM
Originally posted by pervert
Lissa]Do you have any credible sources to back up these assertions? Can you point to a historical tally of the number of starvation deaths before welfare?

You're kidding, right? You must not be a history buff. Read any book about the Victorian era, even, if you don't want to go back further. Learn about the over-crowded, dilapilated slums, the sweatshops, the women forced into prostitution in order to feed their children, and the child beggars who starved in the streets. Learn about the charitable institutions, who arbitrarily decided who were the "deserving poor", and who were not.

No, I can't give you an exact figure: no one can. The poor were people whose lives were not important enough to be recorded for the majority of human history. Their deaths meant very little.

Are any of the countries you mention as lacking a safety net rich enough to afford one?

I'm by no means an expert in contemporary global economics, but as I understand, most indistrialized nations do have social saftey nets.

I'll leave this quetion to someone who is further educated on the issue than I am.

Guinastasia
01-08-2004, 01:16 AM
pervert-Triangle Shirtwaist Factory.

Johnstown Flood.

Homestead Strike.

pervert
01-08-2004, 02:40 AM
No, Lissa, I'm not kidding. I have an interest in history and have read several books. I assumed that since you were making these assertions (although I was not trying to pick on you the assertions are common enough) that you had specific knowledge about starvation. I'm certainly not looking for an exact figure. just a general idea. You see, ALL of the population numbers I have seen suggest that during the 1800s and early 1900s the western nations underwent a very large boom. I'm not trying to suggest that the horrors you list did not happen. I only question the interpretation that capitalism or small government caused them. Also I question whether government intervention solved them, or whether the economy simply exanded enough to accomodate the regulations and the problems.

Guinastasia I've seen seveal histories about those events. I can't figure out what the flood has to do with anything. Am I missing something?
The fire seems to have been a nasty accident. Certainly made worse by the practices of the time, but not different than others of the time. Certainly not were anyone would want to work then or now, but it is difficult to judge the past by the technology of today.
The strike is altogether different. It is clearly a conflict between workers and management. It obviously involved excesses on the part of management. But I think it also involved excesses by labor.

I'm not sure what, exactly, this has to do with our discussion of liberal=communism. I'm not sure the beliefs of liberals of the lat 1800s and early 1900s can be said to be equivilant to the beliefs of liberals today. Perhaps I am reading too much into your very brief post.

Evil Captor
01-08-2004, 07:37 AM
I would be happy paying just 10 percent of my income in a flat tax -- for one thing, it would mean a my taxes would go down considerably. But I would have to be assured that all the J. Randolph Gotrocks and Corporate America Inc. were paying their 10 percent, too. And I just don't believe it. What I am sure of is that they would have their lawyers and lobbyists hard at work in Washington, chiseling loopholes into the law, and that in very short order Gotrocks and the Corporates would be paying all the nothing they presently pay in taxes, and I would be paying the same ten percent.

MFitz
01-08-2004, 10:31 AM
"Acedemia generally means liberal (Socialist, Communist, Progressive, whatever name they are presently hiding under)." -MFitz

My statement was in reference to the political universe within the U.S. Other folks here have already pretty much defined the seperate terms, but I'd like to lay it out systematically and then show you why it is accurate in that context (in addition to being irritating to them) to say what I did.

Libertarians/Constitutionalists: (Keep in mind that Libertarians comes in different degrees too)
Social Freedom: Yes Economic Freedom: Yes Government Scope: Localized, and as small as possible
Libertarianism is a political philosophy which advocates individual rights and a limited government. Libertarians believe individuals should be free to do anything they want, so long as they do not infringe upon the equal rights of others. They further believe that the only legitimate use of force, whether public or private, is to protect those rights. For libertarians, there are no 'positive rights' (such as to food or shelter or health care), only 'negative rights' (such as to not be assaulted, abused, robbed or censored). On the Nolan Chart, libertarianism rests in the upper right quadrant, or that of high economic freedom and high personal freedom.
http://en2.wikipedia.org/wiki/Libertarianism

Socialists:
Social Freedom: Yes Economic Freedom: No Government Scope: Centralized, and very large
In its broadest sense, socialism is a belief that human society can and should be organised along social lines - that is, for the benefit of all, rather than for the profit of a few, which it argued had been the case hitherto. Its key ideas are a belief in equality, both political and economic, as well as opposition to capitalism. The socialist view of social organisation is well encapsulated in the following saying (attributed to Marx): From each according to his ability, to each according to his need.
http://en.wikipedia.org/wiki/Socialism

Communists:
Social Freedom: No Economic Freedom: No Government Scope: Centralized, and all-encompassingly large
Communism, or communist society is the name of the social formation, which, according to Marxism is a classless society in which all property is owned by the community as a whole and where all people enjoy equal social and economic status.

Marxists believe that just as society has evolved from feudalism to capitalism, it will evolve into socialism and eventually communism. However the method by which this evolution occurs distinguishes communists from other socialists, in that communists believe that this evolution will be accomplished by means outlined by Lenin.

Progressives: (The modern Democratic Party = Socialism):
Social Freedom: Yes Economic Freedom: No Government Scope: Centralized, and very large

wealth redistribution, socialization/centralization of essential sectors (education, health care, labor unions, trade restrictions)

government sanctioned rascism/sexism/sexual orientation (Affirmative Action, Quotas)

anti-self defense

Read this link for a good history of the Party: http://en2.wikipedia.org/wiki/United_States_Democratic_Party

Republicans (Conservatives by this forum's standards):
Social Freedom: No Economic Freedom: Yes Government Scope: Localized, with minimal centralized power
http://en2.wikipedia.org/wiki/United_States_Republican_Party

Fascists:
Social Freedom: No Economic Freedom: No Government Scope: Centralized, and all-encompassingly large
The word fascism has come to mean any system of government resembling Mussolini's, that exalts nation and often race above the individual, and uses violence and modern techniques of propaganda and censorship to forcibly suppress political opposition, engages in severe economic and social regimentation, and espouses nationalism and sometimes racism (ethnic nationalism).
http://en.wikipedia.org/wiki/Fascist


Many people believe that drawn out, politics can be represented as a circle, with Fascism and Communism becoming identical at the bottom. However, my view (Constitutionalist/Libertarian) is that the circular model omits Constitutionalism completely. So when explaining it, I draw:

.......................Anarchists

..................Constitutionalists

.......Liberals........................Conservatives

............Communists....Fascists

The circle simply has a line extending from the top, ending at Anarchy, with Constitutionalism bisecting it.

So.... I lump those groups together because they all work for larger central government and are therefore in direct opposition to the U.S. Constitution.

MFitz
"The germ of destruction of our nation is in the power of the judiciary, an irresponsible body- working like gravity by night and by day, gaining a little today and a little tomorrow, and advancing its noiseless step like a thief over the field of jurisdiction, until all shall render powerless the checks of one branch over the other and will become as venal and oppressive as the government from which we separated."

---Thomas Jefferson

jshore
01-08-2004, 12:03 PM
Originally posted by pervert
I'm going to make up a couple guesses. Let's say that 50% of Social Security and 50% of Medicare can be put into the same category as welfare expenditures in terms of wealth transfer.

I have no idea where you came up with this guess. And, it flies in the face of recent arguments by your libertarian-oriented breathren (at NCPA oand perhaps Cato too) who, in fighting for privatization of SS, were arguing that the current SS program as a whole is actually neutral or regressive. (See here (http://www.ncpa.org/pi/congress/pd051100e.html). For a somewhat different view, see here (http://www.soa.org/library/naaj/1997-09/naaj9804_1.pdf).) Now, I am not sure I completely believe them...This issue is not easy to resolve when you are dealing with cross-generational transfers because it depends on how you assume you discount money over time and such. However, I find it amusing that SS can either be regressive or massively progressive depending on what argument a libertarian-oriented person wants to make.


jshore Well, your thousand dollars might not make much of a difference, but do you contribute it? The point is not to cast aspersions on your generosity. The point is simply to point out that if others sometimes question whether liberals are generous or simply want to tax more there may be a reason.


I gave something like $3300 to charity and activist groups in 2002, including about $1000 to the local United Way alone. I think this was something like 14% of my total spending for the year (not including money paid to income and payroll taxes)...Admittedly, it was a much lesser percentage of what I earned since I saved a lot and paid a good chunk in taxes. (I don't have any of the classic tax deductions like a home mortgage so I would venture to say that the percentage I pay in income and payroll taxes is about as large as anybody's.)

Lissa
01-08-2004, 01:44 PM
Originally posted by pervert
No, Lissa, I'm not kidding. I have an interest in history and have read several books. I assumed that since you were making these assertions (although I was not trying to pick on you the assertions are common enough) that you had specific knowledge about starvation. I'm certainly not looking for an exact figure. just a general idea. You see, ALL of the population numbers I have seen suggest that during the 1800s and early 1900s the western nations underwent a very large boom.

As I said, no one will ever know the exact numbers, but there were famines all over the world during the Victorian era which killed millions. In India alone, several million perished.

I hate to restrict this discussion only to Western nations, but during a quick search, the best numbers I found were for Victorian London.

Yes, the Western world did experience a population boom during this time, but this is not necessarily because everyone was suddenly prosperous. Increased santiation (clean water supplies, for example) reduced infectious disease. The fecundity rate in the time before reliable birth control had always been high: disease had just killed off most of the children.

During this population boom, the ranks of the poor swelled. This article, (http://www.victorianlondon.org/publications/raggedlondon-thecentre.htm) written in !861, states that a million people in London lived in grinding poverty. (The next article notes that more than 300,000 of them are recipients of poor-law relief.)

This (http://www.victorianlondon.org/publications/raggedlondon-rates.htm) article is also very interesting. As to the swelling population, it notes:

From the foregoing figures it will be seen that an enormous increase of pauperism has taken place during the last twenty years. That the rates paid are nearly trebled, the number of persons relieved by the rates trebled, and the medical cases relieved more than quintupled.

It claims "only" 3,292 people died of starvation and cold between the years of 1848-1857. However, knowing the rather sloppy record-keeping of the time, I would suppose that number to be somewhat unreliable. It could be much higher.

One interesting quote, contrasting private charity with government funds:

They are of opinion that private charity will never be able to supply an adequate cure for the disease. It has done much, and doubtless without its aid the number of persons perishing annually from destitution would have been much greater than they are at present. But all the charity of all the societies established in London for the relief of the distressed, will be found to amount to less than a farthing in the pound on the property tax value of the metropolis. There are two societies which take the lead in ministering to the urgent wants of the necessitous in the winter season, these are the Metropolitan District Visiting and Relief Association, whose offices are in St. Martin's-place, Trafalgar-square, and the Philanthropic Society. Now the total income of both these societies does not amount to more than 5,000 [pounds] per annum. The income of the former is a little over 3,000 [pounds] a year, and of the latter somewhat more than 1,000 [pounds]. These sums are very judiciously expended, and have saved many valuable lives every year; but what are they when compared with the expenditure of the poor rates, which amounts to 800,000 [pounds] per annum?

Another (http://www.victorianlondon.org/publications/raggedlondon-postscript.htm) interesting quote:

The deaths from "privation," "deaths from want of breast-milk," "deaths from neglect," "deaths from cold" --or, in plain unsavoury words, from utter starvation--increase every year. They were two hundred and twenty-two (in London only) in 1848, they were five hundred and sixteen, within the same area, in 1857, and this, without questioning how many of the returns under the head of "fever," ought to be classed as starvation. Here is a country that spends one hundred millions sterling a year in universal government, and yet allows hundreds of its children, in its metropolis alone, to be annually starved to death!

I'm not trying to suggest that the horrors you list did not happen. I only question the interpretation that capitalism or small government caused them. Also I question whether government intervention solved them, or whether the economy simply exanded enough to accomodate the regulations and the problems.

I wasn't trying to suggest at all that industrialization either caused, or aggravated the problem. People starved to death long before mechanization was ever concieved. Actually, things got a bit better during the Industrial age, because finally there was at least a small effort to help the poor.

However, I will assert that government intervention has gone a long way toward keeping people from starving. After all, when was the last time you heard of anyone starving to death in the United States? Starvation here, today, is almost always deliberate. We don't have Bread Riots any more, no do we se beggars dropping dead in the street.

What changed? Charity certainly didn't turn the situation around. I assert that it was the advent of welfare and other social programs.

pervert
01-08-2004, 05:28 PM
I agree the welfare has a place. But I would assert that the growth of the economy has done far more than government programs to"turn the situation around".

jshore
01-08-2004, 11:31 PM
There was a good interview on NPR's Fresh Air with journalist David Cay Johnston, who has written a book "Perfectly Legal: The Covert Campaign to Rig Our Tax System to Benefit the Super Rich -- and Cheat Everybody Else. " You can listen to it here (http://freshair.npr.org/day_fa.jhtml?display=day&todayDate=01/07/2004).

One of his facts: In 2000, all Americans paid federal income tax at the rate of 15.3% of their total income. The top 400 taxpayers, who earned an average of $174 million, paid at the rate of 22.2% of their total income. If the Bush tax cuts had been in effect, they would have paid at a rate of ~17.5%.

So, as you can see, the federal income tax is not all that progressive at the very top. Note also that the average taxpayer will be paying a significant percentage of income in payroll taxes whereas the top 400 taxpayers will pay only a miniscule percentage of income in payroll taxes. In addition, these numbers deal only with reported income and Johnston argues that there are ways that the superrich use various schemes to avoid even having to report some income.

pervert
01-08-2004, 11:48 PM
Doesn't that still amount to several times the amount of taxes that the average person pays? Even if you count other government revenue streams, don't those 400 citizens pay many times what the averabe person pays? And at that, we are discounting their share of whatever corporate taxes they pay.

AHunter3
01-09-2004, 01:39 AM
I like the MFitz diagram.

(Of course I would. I'm an anarchist)

Evil Captor
01-09-2004, 07:42 AM
Originally posted by pervert
Doesn't that still amount to several times the amount of taxes that the average person pays? Even if you count other government revenue streams, don't those 400 citizens pay many times what the averabe person pays? And at that, we are discounting their share of whatever corporate taxes they pay.

If you are saying the gross amount paid by an individual member of the 400 is more than the gross amount paid by an ordinary person, why yes, of course it is. But even so, the average person FEELS their lesser amount much more sharply than the super rich. If your income is 147 million, and you pay out 28 million in taxes, you can somehow manage to survive on the remaining 119 million. You aren't going to have to worry about paying the mortgage to keep a roof over your head or sweat whether to buy groceries or prescription in any given week. As I read in a book on the wealthy elite, "After the first million, the lifestyle doesn't really change very much as your income goes up."

Thus we see that we should tax the wealthy much more strenuously and reduce taxes on the middle class much more sharply if we want everyone to assume an equitable tax burden.

spectrum
01-09-2004, 10:25 AM
You could double the percentage of their income that the rich pay and it wouldn't really effect their lifestyle in an appreciable way (ooh, one less house in the Hamptons). However, many middle and lower income Americans are literally crushed under the unduly high taxes on the working classes.

If we're going to do anything to the tax system, we need to remove the payroll tax ceilings. Make the rich pay 7.6% on all their income, just like those making less than $87,000 have to.

pervert
01-09-2004, 10:52 AM
Just So I understand. We should tax the rich more than everyone else because everyone else "FEELS" different about it? Is that right?

Lissa
01-09-2004, 11:23 AM
Originally posted by pervert
Just So I understand. We should tax the rich more than everyone else because everyone else "FEELS" different about it? Is that right?

No, I think you're missing the point.

Let's say you have a dollar, and I have ten dollars. We both have to pay ten percent tax. You lose a dime, and I lose a dollar. You will feel the results of that loss more than I will. After all, I still have nine dollars. I may not even miss that money, but for you, it takes away a substantial part of your buying power.

The poor "feel" their tax burden more than the rich do. For them, every dollar counts. For someone like Bill Gates, paying fifty percent of their income in taxes still wouldn't make much of a dent in their lifestyle. After the fist five hundred million, the rest is just gravy.

Plus, the rich have more tax breaks than the poor. They can shovel money into tax shelters. Hell, with a clever accountant, they may end up paying hardly any tax at all. The poor don't have that option. Often, they don't even have bank accounts, let alone deferred comp.

pervert
01-09-2004, 05:24 PM
We need to stop harping on the myth that the rich don't pay taxes. I agree that tax shelters exist. I agree that abuses exist. But to imply that rich people don't or don't have to pay taxes is simply disengenuous. It is simply not born out by the facts.

Unless you mean something else by the phrase, it seems to me that 10% reduction in buying power is still 10% reduction in buying power.

Also, I'd like to try and disabuse you of the notion that "the rest is just gravy". Amassed wealth is the engine that drives our economy. The difference between 500 million in the bank and 1 billion in the bank is 500 million worth of investment capital. Its the difference between 500 million worth of new businesses. And, invested wisely, it is the difference between the future value of 500 million dollars. That is, all the wealth that could have been created by those businesses.

But leaving those points aside, the issue is that we need to defend the idea that rich people should pay more than poor people. Do the rich use the police more? Do they use the army more? How about social programs.

If the only reason that rich people pay more is that they have more, then why don't we apply that logic to more things. Why don't criminal penalties work that way? Why don't rich convicts pay much larger fines? Why don't young convicts serve much longer sentences?

Guinastasia
01-09-2004, 07:11 PM
Originally posted by pervert


Guinastasia I've seen seveal histories about those events. I can't figure out what the flood has to do with anything. Am I missing something?



Yes. The flood happened because the dam at the South Fork Hunting and Fishing Club was not properly maintained by the owners-people like Andrew Carnegie and Henry Clay Frick. For years, they were told, fix the dam, someday there's going to be a huge catastrophy. They refused, because it would cost them money.

On the day of the flood, the employees at the club were told not to mess with the flood gates, because they didn't want to lose the fish population, or something. (It's been a while since I studied it).

The Triangle Shirtwaist Fire was a horrible tragedy that could have been PREVENTED by adequate fire exits and safety regs. The unions were fighting for this, among other things, and the company was cracking down on the unions.

Guinastasia
01-09-2004, 07:14 PM
Hey Lissa-don't forget the worst one of all-the Potato Famine in Ireland.

pervert, my cite for THAT is The Great Hunger by Cecil Woodham-Smith.

jshore
01-09-2004, 07:35 PM
Originally posted by pervert
We need to stop harping on the myth that the rich don't pay taxes. I agree that tax shelters exist. I agree that abuses exist. But to imply that rich people don't or don't have to pay taxes is simply disengenuous. It is simply not born out by the facts.

Well, we are not claiming that the rich as a whole do not pay taxes. What we are claiming is that they don't pay that much in taxes relative to what we think would be equitable, which admittedly is a subject for debate depending on your point of view of what is equitable.

What "facts" do you have anyway? I think I am the one who has presented most of the facts here about what the rich pay. These facts are limited though because there are ways for the wealthy to hide income...If you want to learn about them, you could presumably read Johnston's book (or at least listen to the interview). But, even if this hiding of income is negligible (and I honestly don't know how much of an issue it is), I would still argue that the super-richest 400 paying only 17.5 cents on a dollar of income in federal income taxes while the average taxpayer pays 15.3 is simply too low, especially when the rich will pay a negligible percentage of income in payroll taxes and will pay a lower percentage than everyone else in state and local taxes in most places.


Unless you mean something else by the phrase, it seems to me that 10% reduction in buying power is still 10% reduction in buying power.

pervert, have you ever taken an economics course and heard the term "marginal utility"? If not, I suggest you look it up. Here (http://www.taxanalysts.com/www/readingsintaxpolicy.nsf/0/4A603AA3CCDEF53C85256810006E4969?OpenDocument) is a good article that talks about different justifications for progressive taxation. I don't know if I completely agree with the conclusions but it does state the issues very well and explains the concept of marginal utility for you. See also this (http://www.taxanalysts.com/www/readingsintaxpolicy.nsf/0/2F7102DE3941550885256810006E4970?OpenDocument) paper.


Also, I'd like to try and disabuse you of the notion that "the rest is just gravy". Amassed wealth is the engine that drives our economy.

You have failed to demonstrate that all this wealth in one person's hands drives the economy any better than if it is spread around a little more evenly.


But leaving those points aside, the issue is that we need to defend the idea that rich people should pay more than poor people. Do the rich use the police more? Do they use the army more?

In a word, yes. If you mean more in dollar terms, the answer is obvious. If I paid an insurance company to insure my $100 million diamond, don't you think I'd have to pay them more than if they just had to insure a few thousand bucks in possessions.

If you mean more in fractional terms, I would argue that the answer is also probably yes. And, for this, I bring back in Exhibit A...Bill Gates. That man would be nothing without the trappings of our society. What, you think he's going to earn $10s of billions in some state-of-nature. That is one man who is extremely indebted to society for probably 99.9% of what he has. (And, to his credit, he ... or at least his father ... seems to have some reasonable understanding of that.)

Admittedly, determining each person's gain from society is not easy...In fact, it is impossible. However, I think it is somewhat perverse to imagine that those who have made out fabulously have little debt to society for that they have managed to achieve within it whereas those who haven't done so well are greatly indebted for the little that they have gotten.


If the only reason that rich people pay more is that they have more, then why don't we apply that logic to more things. Why don't criminal penalties work that way? Why don't rich convicts pay much larger fines?

A tax is not a fine you pay. What we are doing is trying to figure out the fairest way to pay for the collective investments in our society. [That said, I think in some cases fines should take into account the amount one can pay...certainly corporate fines have to in order to create the proper disincentive for the company to violate the law.]

pervert
01-09-2004, 09:17 PM
Originally posted by jshore
Well, we are not claiming that the rich as a whole do not pay taxes. Right. But whne Lissa staes blithely that "Hell, with a clever accountant, they may end up paying hardly any tax at all." She is clearly intimating that rich people do not have to pay taxes.

What we are claiming is that they don't pay that much in taxes relative to what we think would be equitable, which admittedly is a subject for debate Exactly. That is what should be debated.

What "facts" do you have anyway? The facts that you and I went over on the first page of this thread. From the link you provided earlier. (http://www.taxfoundation.org/prtopincometable.html) If the top 1% of wage earners pay 30% of the collected taxes then it is simply disingenuous to say that they aren't or don't have to pay taxes. We can readily argue if they are paying enough, but that is a different argument.

You have failed to demonstrate that all this wealth in one person's hands drives the economy any better than if it is spread around a little more evenly.That was not my point. We can argue whether demand or supply drives the economy more. My only poin in the quote you responded to is that rich people do not simply put their "gravy" money in a mattress. I was responding to the assertion that heavily taxing the rich will not affect their lifestyle. True as far as it goes. But it fails to recognize that much of that other money will be invested. Since we are convinced that "percentage of income" is a good measurement tool, how about discovering the savings rate as a percentage of income for rich and poor.

If you mean more in dollar terms, the answer is obvious. If I paid an insurance company to insure my $100 million diamond, don't you think I'd have to pay them more than if they just had to insure a few thousand bucks in possessions.Well, the analogy with insurance is somewhat flawed. Insurance promises to pay you a certain amount in a certain event. The more liekly the event and the more the amount, the more the cost. Does it cost more to police a street with 1 million dollar houses than it does to police a street with 100 thousand dollar houses? Does the army take more risks when defending a nation of millionares than it does when defending a nation of paupers?

Having said that, I do accept the "benifits" analysis proposed in your linked article. That is, I can see reason in the argument that rich people have more property and therefore more of an interest in the operation of the state. You have to be careful with this logic too, however. If you take it too far you may see reason to give rich people more votes.

Exhibit A...Bill Gates. That man would be nothing without the trappings of our society. What, you think he's going to earn $10s of billions in some state-of-nature. That is one man who is extremely indebted to society for probably 99.9% of what he has. Well, nothing as compared to a caveman perhaps. But nothing as compared to another citizen of the United States in the late 20th century? Obviously not. So, if you want to tax Bill Gates more than the caveman, sure go ahead. If you are comparing the poor in this country to cavemen, however, I might want to object. Otherwise, you might need to point out which "societal trappings" were available to Bill Gates that were unavailable to the vast majority of us. If we cannot, then we might need to admit that his wealth is do to his actions more than societies.

Let me put it another way. If you and I invest in a small business with equal shares, and the company does well at first. We should see a profit on our investment. If I put mine into savings and you blow yours on fast booze and loose women what should we do when our company suddenly needs new money? Should I suddenly pay more because I can? Or should my increased investment result in an increased ownership?

I think it is somewhat perverse to imagine that those who have made out fabulously have little debt to society for that they have managed to achieve within it whereas those who haven't done so well are greatly indebted for the little that they have gotten.But that is not the question. Of course rich people must pay taxes. I might even accept that they should pay higher taxes. The question is how do we justify that. And in the context of this thread, how do we justify it without apealing to wealth redistribution.

What we are doing is trying to figure out the fairest way to pay for the collective investments in our society. [That said, I think in some cases fines should take into account the amount one can pay...certainly corporate fines have to in order to create the proper disincentive for the company to violate the law.] I agree with this entirely.:)

I enjoy all your cites, BTW jshore. I hope you don't spend all your time looking things like that up.

pervert
01-09-2004, 09:25 PM
Originally posted by Guinastasia
Yes. The flood happened because the dam at the South Fork Hunting and Fishing Club was not properly maintained by the owners-people like Andrew Carnegie and Henry Clay Frick. For years, they were told, fix the dam, someday there's going to be a huge catastrophy. They refused, because it would cost them money.

On the day of the flood, the employees at the club were told not to mess with the flood gates, because they didn't want to lose the fish population, or something. (It's been a while since I studied it).

The Triangle Shirtwaist Fire was a horrible tragedy that could have been PREVENTED by adequate fire exits and safety regs. The unions were fighting for this, among other things, and the company was cracking down on the unions.

The point, of course being that under what level of taxation would these things not occur? Or is the point that government regulators do not make such mistakes? Ooh, ooh, I know, the point is that if the workers controlled the means of production directly, then things like this would be logical impossibilities! Yea, that's it! ;)

OK, that was a bit snarky. I'm jsut having a bit of fun. I agree that all 4 of the things you brought up were terrible tragedies. What exactly does it have to do with the discussion at hand? Expecially, what does it have to do with the assertion that liberalism saved capitalism from its excesses? How exactly do you propose that these tragedies were excesses of capitalism? Is it because they happened at properties owned by capitalists?

jadagul
01-09-2004, 10:33 PM
On the three justifications of progressive taxation in the article jshore cited:

The first is that tax should be proportional to benefit. As the author of the paper admits, there's no compelling reason to assume that benefit is more than proportional to material wealth; I'd even go so far as to say that it's less. While it's true that some people have a better chance to succeed than others because of their birth or station, that's not the sole, or perhaps even the main factor in a person's wealth (Bill Gates isn't rich because he was born that way; most people have access to most of his opportunities. Should we perhaps tax people proportional to their parents' wealth as they grew up?

The second argument is that money is less useful as you gather more of it; while true, this doesn't prove what needs to be proven. As the author concedes quoting Seligman, "To
ascertain the exact relations between something psychical
and something material is impossible. No calculus of pain
and pleasure can suffice, for no attempt to reduce the
heterogeneous to the homogeneous can ever succeed. " It's impossible to compare my pleasure with your pain, because pleasure and pain are totally subjective factors. Thus I can say that my millionth dollar is less important to me than my thousandth: this is clear because I'll buy things I want more earlier--I'll buy what I want most with the first money I get, and the more I get the less important stuff I buy. But there's no way to make the same sort of comparison between two different people; we can only say what each one prefers, there's no way of quantifying how many 'utils' anybody gets from anything. The attempt to quantify pleasure is ultimately fruitless.

The third justification is mere fiat; he says 'let's assume equality is good, and if you disagree the burden is on you to prove why.' Now, this might have had some validity if wealth came out from nowhere, if the question were how to distribute money the government already has. Thus, this has some input in how to spend government money. But goods are created already owned; thus the question isn't "why should Bill Gates have more than other people," but "Why can we take money from Bill Gates?" The burden of proof would then be on the person who wishes to change the already extant distribution of goods. This isn't to say there aren't valid arguments to be made; only that "it just should" isn't one of them.

Lissa
01-10-2004, 12:09 AM
Originally posted by pervert
Right. But whne Lissa staes blithely that "Hell, with a clever accountant, they may end up paying hardly any tax at all." She is clearly intimating that rich people do not have to pay taxes.

That was a bit of sarcasm, but, actually, a few (http://www.taxpolicycenter.org/news/rich_less.cfm) of the rich pay nothing at all.

More than 2,000 American taxpayers with incomes over $200,000 paid no income tax in the year 2000, a 45 percent increase from 1999, according to the Internal Revenue Service.

pervert
01-10-2004, 12:45 AM
Right but the next paragraph sort of parrots my second objection to this theme:

"cut their tax bills by investing in tax exempt state and municipal bonds. Other common deductions among the group were for small business losses, medical and dental expenses, and theft losses"

They invested in state bonds. These bonds are spcifically tax exempt to attract more money. Seriously, we can't take money from people and then complain that they are not giving anything.

As I said, I understand that some people will use dodges and shelters to get out of paying taxes. I don't like most of the exemptions in the tax code either. I think they could be drastically simplified. But seriously. Investing in state bonds is hardly a tax dodge.

jshore
01-10-2004, 12:50 AM
Originally posted by pervert
Otherwise, you might need to point out which "societal trappings" were available to Bill Gates that were unavailable to the vast majority of us. If we cannot, then we might need to admit that his wealth is do to his actions more than societies.

I'm not saying that there were things available to him that were not available to others (although, in his case, I do believe he came from a quite well-too-do, or at least very well-off, family). But, I am saying that the things available to him, along with his own talents, allowed him to become fabulously wealthy. I am willing to admit that he could not have become nearly so fabulously wealthy without his talents but I also believe that he could not have become nearly so fabulously wealthy without the society. Also, as Warren Buffett says, he himself has talents that just turn out to lead to fabulous awards in terms of wealth. Buffett doesn't see this as completely reflecting on his own wonderfulness but also what society rewards.

I tend to look at life as sort of a big game where there is a combination of skill, and luck, and cunning, and whatever needed to succeed. I think as a society we have necessarily pooled our resources because we can all in general do much better that way. Thus, when one person, through whatever combination of skill and luck and cunning does better than the rest of us, I tend to think he owes something back to the common pool.


Let me put it another way. If you and I invest in a small business with equal shares, and the company does well at first. We should see a profit on our investment. If I put mine into savings and you blow yours on fast booze and loose women what should we do when our company suddenly needs new money? Should I suddenly pay more because I can? Or should my increased investment result in an increased ownership?

But, I really think this example is taking things to an extreme. The fact is that those who succeed now are being fabulously rewarded. I don't think asking them to give more than 17.5 cents on a dollar back to the federal government is anything approaching some horrible redistribution from the industrious to the lazy.

The fact is that our society is drifting toward an incredible gap in wealth between the haves and have-nots. We are talking about a top 1% who have multiplied their after-tax incomes by a factor of 2.5 in less than 20 years while most people have barely increased theirs at all (about 10%). That to me just makes our society look bizarre...I mean why do we care so much about economic growth if almost all of it is going to go into the hands of just a few "winners". There is a book called "Winner Take All Society" that documents some of this and argues that even from the point of view of efficiency it might not be a good thing. That is, there is usually an assumption that there is a trade-off between equality and efficiency because too much equality lowers incentives. But, these authors argue, and I think they may well be right, that inequality has grown to a point where it is wasteful because people expend a lot of energy in unproductive ways trying to "hit the jackpot" in a sense...almost like a nuclear arms race.


I enjoy all your cites, BTW jshore.

Thanks. I enjoy discussing these things with you, and it is a good challenge to try to clarify why I think the way I do. I admit that these are hard questions to wrestle with and, unlike in science, one can't really prove one answer as being more correct than another.


I hope you don't spend all your time looking things like that up.


Well, I probably do spend too much time on this! Although google is a wonderful thing.

jshore
01-10-2004, 01:13 AM
Originally posted by jadagul
The first is that tax should be proportional to benefit. As the author of the paper admits, there's no compelling reason to assume that benefit is more than proportional to material wealth; I'd even go so far as to say that it's less. While it's true that some people have a better chance to succeed than others because of their birth or station, that's not the sole, or perhaps even the main factor in a person's wealth (Bill Gates isn't rich because he was born that way; most people have access to most of his opportunities. Should we perhaps tax people proportional to their parents' wealth as they grew up?

Well, I admit that you can go around in circles on the benefit thing. But, where I end up, as I said, is that I think our society creates great instabilities that allow for way-vaster accumulations of wealth than could be obtained in its absence. Personally, my feeling is that in order to agree to live in such a capitalist society, i.e., as part of the social contract, I would expect these people who reap these huge rewards to have more proportional burden than the rest of us to give some back to the society.

As for your last sentence, watching my nephews grow up and comparing them to how I imagine kids growing up in less fortunate circumstances, I can't help but be impressed with the extent to which these things are likely to matter. This is another strong reason for progressive taxation (and good social services, public schools, etc.) I think it is ludicrous to think that our society is anything close to giving everyone an equal chance.


The second argument is that money is less useful as you gather more of it; while true, this doesn't prove what needs to be proven. As the author concedes quoting Seligman, "To
ascertain the exact relations between something psychical
and something material is impossible. No calculus of pain
and pleasure can suffice, for no attempt to reduce the
heterogeneous to the homogeneous can ever succeed. "

Well, I admit that this can't be done to the point of actually determining the correct taxation distribution. But, the law of decreasing marginal utility is quite general...and I think it is quite obvious here. In fact, I would argue that while I don't know what amount of progressive taxation would be mandated by maximizing utility, I am quite confident that it would be way-more progressive than what we have. In the end, I think you have to balance things against other considerations like having incentives.

I think all of this about not being able to compare people's pleasure and pain is pretty much of a red herring. Sure, we will never be able to compute it like a formula but to claim that we can't determine some general things like that $10 to me is worth more than $10 to Bill Gates (and less to me than $10 for a homeless person) is just silly in my opinion. Sure, we may not be able to prove it in a mathematical sense, but very few things can be proven deductively even in the hard sciences, let alone in the social sciences.


But goods are created already owned; thus the question isn't "why should Bill Gates have more than other people," but "Why can we take money from Bill Gates?" The burden of proof would then be on the person who wishes to change the already extant distribution of goods.

This is where we have a very fundamental point of disagreement. As I have tried to argue in this and other threads, the idea that this "extant distribution" is some sort of fixed reality is, to my mind, silly. This money has accrued to the various people in a highly interactive society with a set of rules that is not laid down from On High. I've often used an analogy here to physics...In physics, in some systems, one sometimes has to abandon the idea that the particles (electrons in particular) can be treated as independent particles that interact. Rather, the system is so highly interactive that they lose their individual nature and one cannot assign phenomena to them independently but rather just to their collective effects.

I think our economic society is to the point where this is sort of true. We have come up with a way in which we allocate money and property and all to people but people should not be fooled into believing that it is really "theirs" and the government is taking it away from them when they are taxed. In fact, that leads to a logical contradiction because if everybody is entitled to keep everything they earn then there is no money left to pay for the government services that we all used to make that money. So, we have to figure out how much each person contributes to this collective society...I admit that the method of doing this is messy and we are still struggling with how to do it well. But, I think it has to be done through the political process and there is no a priori reason to believe it should necessarily be done by adopting some simple arbitrary rule like "everyone pays the same percentage of their income". I think this is indeed one possible rule but to decide that this is the correct thing and that anything else constitutes "redistribution" (or, among more extreme libertarian-types "theft") is in my view just nonsense.

pervert
01-10-2004, 01:25 AM
Just a couple quick points.
Originally posted by jshore
I'm not saying that there were things available to him that were not available to othersNo, I agree that you were not claiming this. I may have implied that I thought so. I didn't mean to.

However,

I am saying that the things available to him, along with his own talents, allowed him to become fabulously wealthy.Unless there is something which was available to him which was not available to others, you are left with his talent. That he ows something back to society I agree with. Certainly all of us benifit (greatly in fact) from living in the modern world. The question is why did Bill Gates benifit more, or why should he owe more than you or I. If the main difference is luck and talent, then I'm not sure you can justify a progressive tax.

I think as a society we have necessarily pooled our resources because we can all in general do much better that way. But we have not pooled our resources. Unless you mean this in some sort of restricted way, like we have pooled our resources for certain functions like government.

I don't think asking them to give more than 17.5 cents on a dollar back to the federal government is anything approaching some horrible redistribution from the industrious to the lazy. Well my example was not meant to accuse you of holding this sort of confiscatory philosophy. I think I may have forgotten to include my joke. I meant to say that while I saved the money, I envied your use of it. :)
I'm not sure I disagree that a proportional or even slightly progressive tax is desireable. I'm just not sure that it should be so high. Personally I would happy with a very progressive tax if we could also cut the federal budget by half or more.

The fact is that our society is drifting toward an incredible gap in wealth between the haves and have-nots.Except that we are not. We are approaching a gap between the have a lots and the have not so muches. Just because my income is X times smaller than Bill Gates, does not mean that I am a have not.

We are talking about a top 1% who have multiplied their after-tax incomes by a factor of 2.5 in less than 20 years while most people have barely increased theirs at all (about 10%).Yes. But where did most of the increase in wealth go to. If the top 1% of the 100 million workers (or tax reporters since that's probably where this stat comes from)recieved 2.5 times as much wealth over the last 20 years and the other 99% increased their wealth by 10%, which group got richer. If Iam reading the AGI table (http://www.taxfoundation.org/prtopincometable.html) from your taxfoundation link correctly, it says that while the difference certainly increased, (the top 1% earned 1/6th of the money) the rest of us definately increased as well (the top 50% increased about 5 times). The point being that while we may not have each increased as much as the top 1%, we definately did increase our wealth. See, the increasing gap is irrelevant except as a tool of class envy.

From your next post:
We have come up with a way in which we allocate money and property and all to people but people should not be fooled into believing that it is really "theirs" and the government is taking it away from them when they are taxed.[/B]OK, but you have to severely warp the meanings of several of these words to make this true. Just because people interact does not reduce the effect of individuals. It certainly doesn't imply that uninvolved third parties were suddenly part of the equation.

You can certainly make a case that government provides services which every citizen uses. And that we should all pay for them. I think this argument can even be stretched to justify a progressive tax. But we have to be very careful when suggesting that wealth created by individuals is not theirs at all. That "we allocate money and property". This simply is not true. Given the tone of this thread, it is especially important to avoid this sort of communistic generalization. ;)

Guinastasia
01-10-2004, 02:38 AM
My point is, that laissez faire capitalism with no checks-no safety regs, no unions, no worker's rights-was a really shitty thing.

pervert
01-10-2004, 02:44 AM
Well, I'm not sure that your list of incidents is proof of that either. Can you say that those incidents took place under such a system? Were there NO regulations in the city that applied to the shirt factory fire? I also remember reading that no one sued the owners of that dam. I did not see any good reasons for this, but it suggests that laws which existed were not utilized.

But, I don't think anyone in here has suggested that removing all regulation is a good idea. I simply think that examples from 100 years ago are not very good reason to increase the regulations of today.

adaher
01-10-2004, 02:49 AM
Regulations to promote safety and fair labor standards make sense.

Regulations that control competition are extremely harmful. Or regulations that impose price controls. Most "deregulation" is really only repealing those regulations that create government-mandates monopolies, price controls, or limit competition to a few huge companies.

Plus, even with safety regulations, the cost of implementing them should be compared with the likely benefit. For example, if installing a safety device on a car will save 10 lives but adds $5000 to the price of the car, I don't think many people would consider that a sensible thing to force on car makers and consumers.

Lissa
01-10-2004, 11:22 AM
Originally posted by pervert
But seriously. Investing in state bonds is hardly a tax dodge.

It depends on how you do it, in my opinion. At a certain level, it becomes almost an abuse of the system. Yes, they're intended to raise money for civil projects, which is all well and good, but the idea behind it is to attract many small investors, not invite two or three large ones to shovel in a substantial part of their income to avoid paying taxes.

By stashing large sums in the bonds, they're not doing anything illegal but they are "cheating" the government by paying no taxes, and possibly earning interest on the money as well. The government actually loses money on the deal. That wasn't the intent of the bonds.

Originally posted by adaher

Plus, even with safety regulations, the cost of implementing them should be compared with the likely benefit. For example, if installing a safety device on a car will save 10 lives but adds $5000 to the price of the car, I don't think many people would consider that a sensible thing to force on car makers and consumers.

That's exactly what Ford (http://www.fordpinto.com/blowup.htm) said about the Pinto. The car had a tendancy to catch fire if struck from behind, because bolts punctured the gas tank.

[quote]The financial analysis that Ford conducted on the Pinto concluded that it was not cost-efficient to add an $11 per car cost in order to correct a flaw. Benefits derived from spending this amount of money were estimated to be $49.5 million. This estimate assumed that each death, which could be avoided, would be worth $200,000, that each major burn injury that could be avoided would be worth $67,000 and that an average repair cost of $700 per car involved in a rear end accident would be avoided. It further assumed that there would be 2,100 burned vehicles, 180 serious burn injuries, and 180 burn deaths in making this calculation. When the unit cost was spread out over the number of cars and light trucks which would be affected by the design change, at a cost of $11 per vehicle, the cost was calculated to be $137 million, much greater then the $49.5 million benefit.

Lissa
01-10-2004, 11:25 AM
Sorry. Hit enter, and for some reason, it posted.

The article I was quoting went on to say:

The fires that occurred in Pintos could have been largely prevented for considerably less than $11 a car. The cheapest method involves placing a heavy rubber bladder inside the gas tank to keep the fuel from spilling if the tank ruptures. Goodyear had developed the bladder and had demonstrated it to the automotive industry. Crash-tests were conducted and there are reports showing that the Goodyear bladder worked very well. On December 2, 1970, Ford Motor Company ran a rear end crash test on a car with the rubber bladder in the gas tank. The tank ruptured, but no fuel leaked. On January 15, 1971, Ford again tested the bladder and again it worked. The total purchase and installation cost of the bladder would have been $5.08 per car. That $5.08 per car could have saved the lives of several hundred innocent people.

So, do you believe Ford was correct in its actions when it decided, based on the incorrect information of the costs, that they should just pay off the lawsuits of burn victims' families?

jshore
01-10-2004, 05:13 PM
Originally posted by pervert
Unless there is something which was available to him which was not available to others, you are left with his talent. That he ows something back to society I agree with. Certainly all of us benifit (greatly in fact) from living in the modern world. The question is why did Bill Gates benifit more, or why should he owe more than you or I. If the main difference is luck and talent, then I'm not sure you can justify a progressive tax.

Yes, but his luck and talent couldn't do it alone. He needs the society. To put it to you this way: If I could help you win a big lottery and it would be due to genius and hard work on your part but there was also a part that you needed me for, I would be in a pretty good bargaining position vis-a-vis what fraction goes to me. You might try to argue that almost all of the hard work and genius will be on your part so you should get the overwhelming fraction. But, then I will point out that, you won't be able to do it without me. (You may counter that I won't be able to get anything without you. But, actually, I have a hard time buying this. I mean, I think if Bill Gates never existed, our society would be just fine, thank you, and the computer revolution would have gone along just fine without him. We might even be in a situation where people had higher satisfaction with their computer operating systems and software than they do now.)


But we have not pooled our resources. Unless you mean this in some sort of restricted way, like we have pooled our resources for certain functions like government.

Yes, that is what I mean. We have also made a sort of social contract. We've agreed to have a capitalist economy and such. To be honest, if someone offered me a society with a capitalist economy with corporate law and property rights law and intellectual property law the way they are, I think I would not really be too keen on being part of such a society unless the contract including stipulations to the effect that measures would be taken to counteract the immense concentrations of wealth and power that result from this system and to try to have at least some measure of insuring that we all get a reasonable share of the wealth that is produced.

There have been conscious decisions made to structure society in a way that results in immense concentrations of wealth. So, I don't see why any deviation from this often gets labelled as "redistribution" as if the distribution that resulted from this structure was what was natural or desirable.


Personally I would happy with a very progressive tax if we could also cut the federal budget by half or more.

Well, what would you cut specifically?


Except that we are not. We are approaching a gap between the have a lots and the have not so muches. Just because my income is X times smaller than Bill Gates, does not mean that I am a have not.

Yeah...but there are two problems with this. One is that people do seem to judge this stuff relatively...i.e., almost the only way we know to measure what we have is against others. I think there have been studies to this effect. Thus, I think having a very skewed distribution is going to lead to unhappiness at the bottom even if those at the bottom are not poor in comparison to some standard like a few hundred years ago or in 3rd world countries. And, this unhappiness will inevitably spill over into society at large.

The second problem is that I think that it truly is more difficult to live at a certain income in our society than in poorer societies because costs are driven up by the affluent. For example, if you don't have the money to afford the inflated housing prices in a region, you will end up in a neighborhood with bad crime, bad schools, etc. I don't think these places are just bad in relative terms...I think they can be quite bad in absolute terms. And, almost everything tends to be more expensive, as those who travel in 3rd world countries will testify...I.e., a dollar goes much further there.


Yes. But where did most of the increase in wealth go to. If the top 1% of the 100 million workers (or tax reporters since that's probably where this stat comes from)recieved 2.5 times as much wealth over the last 20 years and the other 99% increased their wealth by 10%, which group got richer. If Iam reading the AGI table (http://www.taxfoundation.org/prtopincometable.html) from your taxfoundation link correctly, it says that while the difference certainly increased, (the top 1% earned 1/6th of the money) the rest of us definately increased as well (the top 50% increased about 5 times). The point being that while we may not have each increased as much as the top 1%, we definately did increase our wealth. See, the increasing gap is irrelevant except as a tool of class envy.

Well, that is only if you think noone has a right to complain as long as their situation didn't actually get worse. The society got a lot richer and yet it hardly made any difference to the lives of the large majority of people. I think that raises the question of whether there was another path whereby the society gets a lot richer and these benefits are shared a little more equally. This is particularly true given that policies are geared to expanding the wealth of society. You have to ask if these policies are the best policies to pursue if they benefit primarily a select few and just throw some small scraps to everyone else.

I should also note that the numbers from 1979-1997 that show some modest 10% gain in family median income also show that this gain was due essentially entirely to people working more hours. If you look at real median wages, I don't think they went up at all. And, I believe families in the bottom quintile actually saw their real incomes not go up at all or even decline. I'd have to look back at the details. [In the 1997-2000 time, when the labor market got really tight, there was some gains in median wages. But, I don't know how these gains have faired during the recession.]


But we have to be very careful when suggesting that wealth created by individuals is not theirs at all. That "we allocate money and property". This simply is not true.

Well, I may be exaggerating a bit to make a point and to fight against the opposing idea (expressed by the most ardent libertarian-types) that every penny someone earns is rightfully theirs and taking it away is theft. I mean I know that our market system is set up in a way in which what people get out of the system is supposed to reflect the amount that their contributions are worth to other members of society. However, I think people forget the many, many assumptions that go into this and the many, many ways in which markets don't work ideally. I would grant that the amount someone earns still bears some relationship to what they have contributed. (If it didn't, it would be hard to justify not massively redistributing money pretty evenly all around.) But, I think at the moment people seem to generally be erring on the side of believing too strongly in the connection between what money you get in the system and what your contribution is. This is particularly true amongst those (like Bush, Cheney, ...) who have done very well. This is why it is so refreshing for me to hear someone like Warren Buffet argue otherwise.

sqweels
01-10-2004, 11:51 PM
Pervert, why do you have to frame the issue in such stark ideological terms when we're just bickering over a couple of percentage points? Why can't you accept that the current tax rates represent a compromise among all the practical and philosophical considerations? The top tax rates have been cut greatly under Reagan and again under Bush II, meaning that the ideal that wealth belongs to the individual has been given greater weight than in the past--and in most other countries. Sympathy for the less well-off and the greater impact their tax burden has on their standard of living is lessened of late, but the result is a tax code that is still modestly progressive. Can't we just accept the current compromise and stop all the bitching and commie-baiting?

pervert
01-11-2004, 01:10 AM
I'm not sure I have framed the issue in stark ideological terms. Have I? If I have left anyone with the impression that I think liberals are communists I appologize and cringe at my horendous inability to communicate. I have been trying all along to suggest that the idea that libera = communism is mistaken. It may have some reasonableness in certain regards. But on the whole it requires forgetting several critical features of liberalism and communism.

What I am trying to get at with my back and forth with jshore is a way to define welfare without resorting to emotional, communistic, wealth redistribution motives. In another thread erislover suggested an insurance analogy. I don't wholly agree with that either. But it should be added to the increased benifits and lessened pain arguments we are discussing.

pervert
01-11-2004, 01:46 AM
I actually wrote 3 other responses to this post. I deleted them as too snarky. I appologize in advance for any snarkyness left and ask that you point it out so I can ridicule it with you. ;)


Originally posted by jshore
Yes, but his luck and talent couldn't do it alone.Sure. I agree with that. However, given that his success places him in a very small minority, we have to be willing to examine why his success is so rare. If you say that most of his success is due to societal activity, then we have to ask why more people are nto as successful. Or, of course, you have to be willing to see things that society did for him which it did not do for most others. That is, if society is more responsible for his success, then why did it favor him over others. If, however, his success was mostly due to his own activity, then we have to conclude that most of his wealth is in fact his.

We have also made a sort of social contract. We've agreed to have a capitalist economy and such.I deleted 3 responses to this. They were entirely too snarky. AFter more reflection I doubt that you meant this the way I read it at first. You did not mean to suggest that the American decision to have a free market as opposed to a planned economy was equivilant to a fashionable decision did you? That is, I'm not sure you meant to trivialize the differences, correct?

To be honest, if someone offered me a society with a capitalist economy with corporate law and property rights law and intellectual property law the way they are, I think I would not really be too keen on being part of such a society unless the contract including stipulations to the effect that measures would be taken to counteract the immense concentrations of wealth and power that result from this system and to try to have at least some measure of insuring that we all get a reasonable share of the wealth that is produced.Well, I would argue that if we had a system which more througoughly respected property and civil rights, we would not be as worried about the amassing of wealth. Unless you bring political influence into the equation, what possible difference could it make to a man making a comfortable living that someone somewhere else is makeing 10 times as much. Personally I find it quite inspiring.

There have been conscious decisions made to structure society in a way that results in immense concentrations of wealth. So, I don't see why any deviation from this often gets labelled as "redistribution" as if the distribution that resulted from this structure was what was natural or desirable.This troubles me a little as well. The system of government in the United States was not at all set up to promote concentrations of wealth. It was set up to promote freedom. Unless you mean that allowing individuals to interact freely promotes wealth concentration. But I would argue that it does not really. It may promote wealth creation. The welath created under such a system may be created at the top more than at the bottom, but only as a function of individual income. Remember the numbers which indicated that most of the new wealth went to groups below the top 1%?

Well, what would you cut specifically?Me, Personally? Well, I'd probably get so fed up withe the political wrangling, that I woudl cut everything. I'd simply say to every single part of government that they had to cut a couple percetn a year for a while. At least until we could get our debt under control and establish a few real savings funds.

almost the only way we know to measure what we have is against others.I disagree. I think judging ourselves this way is common, but it is not the only way we know. It is most definately not the best way to judge ourselves.

The second problem is that I think that it truly is more difficult to live at a certain income in our society than in poorer societies because costs are driven up by the affluent.But this can only e true if the affluence is wide spread. For instance we have been talking about the top 1% income group. I don't think that even should the gap double or tripple it would make any difference in the average home price. Perhaps, but I seriously doubt it.

Well that is only if you think noone has a right to complain as long as their situation didn't actually get worse.Everyone has a right to complain about absolutely anything. Freedom of speech and all that. I only object to basing economic policies on envy.

The society got a lot richer and yet it hardly made any difference to the lives of the large majority of people.But this is the point I question. If we took all of the money that went to the top 1% (which I understand you are not advocating) and distributed it to the next 49% (I'm not going lower because the tax foundation site does not have numbers for them) we go from 5,000,000 to 6,000,000. Not much more of an improvement than the 10% you said "hardly made any difference". And if we take less than all of it, of course, we get even less of a boost. My only point is that the wealth increase is not nearly so inequitable if you can look beyond percentage increases. Expecially when you notice that the number of returns in the top 1% and the top 50% grew by about 38%. That is everyone's income went up and the number of people in each catagory went up. I'm not sure how spinning this as a few got rich while the rest got poor is anything but a lie? The total wealth went up. The number of people participating in the wealth at all levels went up. The only way it looks bad is that the wealth per capita is different amongst different groups.

jshore
01-11-2004, 02:43 PM
Originally posted by pervert
I actually wrote 3 other responses to this post. I deleted them as too snarky. I appologize in advance for any snarkyness left and ask that you point it out so I can ridicule it with you. ;)


I don't find it snarky. I do worry though that both of us are starting to repeat the same arguments...So we may be sort of at an impasse.

One useful thing I did discover this morning is that the CBO recently extended the data on incomes and taxation up through year 2000 and here (http://www.cbpp.org/9-23-03tax.htm) is a detailed analysis of it by CBPP (Center on Budget and Policy Priorities). A few of the most notable facts:

(1) In the 1979-2000 period, real after-tax income of the top 1% increased by 201%...i.e., a factor fo 3. For the middle quintile, there was a 15% increase and the bottom quintile saw a gain of 9%. Note that the average real income increased by 40%...So, this difference between 40% increase for the average and 15% for the median gives you an indication of how much better folks at the median would have done if all the gains had been shared equally (in percentage terms), rather than being concentrated at the top. In other words, if the same gains had been made in the economy but inequality had stayed constant (in ratio terms) during this period, the median folks would have experienced almost 3 times the gain that they had. Of course, if [heaven forbid!] inequality had actually decreased, the gains for the median income folks could have been even greater.

(2) In absolute dollar terms, the after-tax income gains enjoyed by a family in the top 1% were 100 times greater than those enjoyed by a family in the middle quintile and 500 times greater than those enjoyed by those in the bottom quintile.

(3) There is indirect evidence, although admittedly not proof, that policies matter in who gets what gains since the period of the 1980s and the period of the 1990s saw much different results in terms of who got what. In the 1980s, the lowest two quintiles actually lost ground in terms of real after-tax income, whereas in the 1990s the gains were much more evenly distributed. As CBPP summarizes it:


To be sure, developments in the private economy have been the principal driving force behind the widening gaps between those at the top of the income scale and everyone else. In the 1980s, however, changes in federal tax policy exacerbated the trend toward widening income disparities, while in the 1990s, changes in federal tax policy moderated this trend. Although federal tax rates declined across the income spectrum in the 1980s, they fell much more sharply for the top one percent of households than for other groups. By contrast, in the 1990s, tax burdens rose among the top one percent of the population while falling for the bottom three fifths of households.


(4) What data is available suggests that the share of the national income of the top 1%, both pre-tax and after-tax, is at the highest level its been at any point going back to 1929.

One piece that is not presented here is median wages. I seem to recall that the gains made at the median income, at least for the 1979-1997 period, were attributable entirely to increase in working hours, as hourly wages stayed the same. But I am not sure where I saw that statistic.

pervert
01-11-2004, 03:12 PM
OK, we are going back and forth over the same ground. I'd like to make one more point, and then you can have the last word about who earned what.

Originally posted by jshore
(1) In the 1979-2000 period, real after-tax income of the top 1% increased by 201%...i.e., a factor fo 3. For the middle quintile, there was a 15% increase and the bottom quintile saw a gain of 9%. Note that the average real income increased by 40%...So, this difference between 40% increase for the average and 15% for the median gives you an indication of how much better folks at the median would have done if all the gains had been shared equally (in percentage terms), rather than being concentrated at the top.
But these percentage analysis are very misleading. For instance, look at the table labeled "Appendix Table 2" in your cite. It implies that the share of income increased for the top 1% and the top 5% only. It is a blatent attempt to suggest that these very wealthy groups got richer on the backs of the rest of us. But this is clearly not true. Reading the rest of the report carefully, all income groups increased their per capita wealth. And from the Tax Foundation link we were discussing earlier, we know that these groups grew in size as well. Which means that the per capita percentage increase in income is very misleading as to the total wealth that acrued to any given group.

This new cite does not give enough figures to tell for sure, but I suspect that even your last assumption is flawed. That is, if the wealth were distributed evenly throughout the population, I doubt very much that anything like a tripling for the median would have occured. The average income increase was calculated, unless I am mistaken, by averaging the increases by the variouas groups. Unfortunately this also ignores the number of people in those different groups. As I said last time, if we were to take all of the money earned by the wealthiest 1% and give it to the rest of us it would not make a juge dent in this gap. The problem is that the "rest of us" are so numerous in comparison to the top 1% that distributing their wealth would not make much difference.

The only way an income gap appears is when we look at income as percentages like in the links you have provided. It is NOT a good way to measure wealth creation rates.


OK, that's my last word on the subject of who made the most money. Please feel free to take me to task on any point.

As an aside, have you ever read Innumeracy by John Allen Paulos? I used to read news reports and studies most uncritically. Since I read that book, I never let a statistic pass unexamined.

pervert
01-11-2004, 03:18 PM
Originally posted by Lissa
By stashing large sums in the bonds, they're not doing anything illegal but they are "cheating" the government by paying no taxes, and possibly earning interest on the money as well. The government actually loses money on the deal. That wasn't the intent of the bonds.I'm sorry, but this is insane. The purpose of bonds was not to allow people to make money? The purpose was not to invite investment? Investing in the city is a tax dodge??? You do realize the bonds are not open ended, right? Its not like people can put any amount of money into bonds whether the city needs the funds or not. The city (usually) has to ask for a certain amount of money and only when people invest that amount do they get it. Once that amount is invested, no one else can buy bonds from that city. That is, the government has complete and total control of this "dodge". Citi bonds are tax exempt or tax defered to encourage people to invest in cities. It allows cities to raise funds which would be much harder otherwise.

pervert
01-11-2004, 03:29 PM
Originally posted by Lissa
So, do you believe Ford was correct in its actions when it decided, based on the incorrect information of the costs, that they should just pay off the lawsuits of burn victims' families? Well, adaher has not responded, so I will. If he chooses to contradict me please consider his post to take precidence.

It seems to me that your example is exactly the opposite of the hypothetical that adaher posed. He suggested that a significant cost to save 10 lives would be undesireable. You found an example where a trivial expense would have saved hundreds of lives.

The economic analysis done by Ford concerning the Pinto was flawed in several respects. They compared the cost to the cost of lawsuits without good reason. The lawsuits could easily have been much higher than the numbers you quoted in the article. Are you sure that article is not merely quoting the lowest estimates? Also, the analysis failed to note that $11 dollars could easily have been passed on to the consumer, while the $5000 dollars in adaher's hypothetical could not.

I feel I should point out, that the article you linked to was similarly flawed. It quotes many numbers of deaths by automobile fire but never once differenciates how many were due to Pintos verusus the rest of the automobiles on the road. It certainly never differenciates the nubmer due to rear end collisions. It does this, IMHO, in a disengenuous attempt to inflate the deaths attributable to Ford's bad decision.

Having said all that, I think that Ford did the right thing in trying to analyse the costs of fixing the Pinto problems. They simply made several bad assumptions which invalidated the analysis.

Let me turn the question around on you. Do you think that any expense is acceptable if it will save even 1 life? If so, why do you not call for the immediate and indefinate banning of automobiles until we can find a way to save the 50,000 people who die each year in them?

jshore
01-11-2004, 03:41 PM
Originally posted by pervert
If you say that most of his success is due to societal activity, then we have to ask why more people are nto as successful. Or, of course, you have to be willing to see things that society did for him which it did not do for most others. That is, if society is more responsible for his success, then why did it favor him over others. If, however, his success was mostly due to his own activity, then we have to conclude that most of his wealth is in fact his.

I don't see how that follows. It is not necessarily an issue of favoritism but a system of "winner-take-all" where the amount that people walk away with is out-of-proportion with their contribution as compared to others. (Although, clearly, one of the ways in which our society works is that when people gain economic power, they gain political power by which they are able to gain more economic power, so I won't totally discount favoritism in many cases.) That is why I like my example of imagining Bill Gates in negotiation with society at large. Both might feel that the other one needs them but I think society's claim is more believable. After all, even if only 1 in a million people have the talents to cause the sort of revolution in computers that Bill did (and my guess is that this is a low estimate), if Bill walks away from the bargaining table he loses pretty much everything whereas society has a couple hundred more people it can go and tap. This suggests to me that Bill needs society more than we need him.

And, of course, luck comes in here too. After all, I don't think the most recent winner of the lotto got where he is compared to everyone else because of his superior talents or hard work.


I deleted 3 responses to this. They were entirely too snarky. AFter more reflection I doubt that you meant this the way I read it at first. You did not mean to suggest that the American decision to have a free market as opposed to a planned economy was equivilant to a fashionable decision did you?

Well, you are talking in extremes. I am more talking at the margin. I.e., I am not saying the choice is between a free market and planned economy but what about between our current system and one in which corporate law is very different. Perhaps corporations as we know them are not even given the special legal privileges that we have granted them...or maybe they are but in return they must really show that they are being good corporate citizens in order to have their charters renewed.

And, even if we were to conclude that our current corporate law is the best thing because we worry that these other paths, while leading to less concentration of wealth, would also stifle wealth creation too much, we might still decide that part of the bargain we want to make is to explicitly decide to tax very progressively in order to mitigate the "winner-take-all" effects of extreme wealth concentration.


Well, I would argue that if we had a system which more througoughly respected property and civil rights, we would not be as worried about the amassing of wealth. Unless you bring political influence into the equation, what possible difference could it make to a man making a comfortable living that someone somewhere else is makeing 10 times as much. Personally I find it quite inspiring.

Well, we have a very different view of the conditions faced by those people at the bottom. I would suggest reading some on the sort of day-to-day struggles faced by these people in terms of violence and hopelessness in their lives.

Of course, maybe you are talking about those at the median, and I can see this argument applying more there. But, I would still argue that "comfortable living" may not be a good description in all ways.


This troubles me a little as well. The system of government in the United States was not at all set up to promote concentrations of wealth. It was set up to promote freedom. Unless you mean that allowing individuals to interact freely promotes wealth concentration.

I think this is a very simplistic view of economic policy in this country to claim that it is simply set up to promote freedom. There are all sorts of decisions that are made everyday...related to monetary policy, taxation policy, subsidies, the ability of people to pass on wealth and all the advantages that go with it to their heirs. All of these policies are decided in an environment where the "haves" have much more access to politicians than the "have-nots".

I'll admit, however, that there is currently a debate even in liberal circles about the extent to which the current inequality is due primarily to policy decisions and the extent to which it is due to structural features of the markets. For example, on one side of this debate, you have James K. Galbraith with his book "Created Unequal" where on the other side you have Robert Frank and Philip Cook with "The Winner-Take-All Society." However, even if it is true that the market itself is promoting these vast inequities in wealth, it does not follow that we should not as a society decide to remedy them. We might decide to do this for reasons of equity, although Frank and Cook would argue that we probably want to do it even for reasons of efficiency. I.e., they claim that we are at an extreme where the "winner-take-all" aspects are introducing a lot of inefficiency in addition to inequality.


Remember the numbers which indicated that most of the new wealth went to groups below the top 1%?

Actually, I don't remember any numbers that directly addressed that. Were there some? Still, I think that it would be pretty hard to sell tax cuts for the top 1% with the slogan, "The top 1% need their taxes cut since they didn't even manage to capture 50% of the new wealth in our society over the last 20 years."


Me, Personally? Well, I'd probably get so fed up withe the political wrangling, that I woudl cut everything. I'd simply say to every single part of government that they had to cut a couple percetn a year for a while. At least until we could get our debt under control and establish a few real savings funds.

You may recall that we pretty much had our debt under control just a few short years ago. ;)

As for "cut everything", that is the sort of statement that is easy to make but hard to implement. It is always easy to say in that in the abstract, which is why Republicans often campaign on a platform of cutting spending but then don't end up doing it.


But this can only e true if the affluence is wide spread. For instance we have been talking about the top 1% income group. I don't think that even should the gap double or tripple it would make any difference in the average home price. Perhaps, but I seriously doubt it.

Well, okay, while the top 1% has done most fabulously, I am not claiming that it is all due to them that housing prices are up. It's a more gradual issue as you go up the economic ladder. I.e., the top 10% are probably making it difficult in many locales for those in, say, the top 50% to be able to find nice affordable housing. And, the top 50% are making it harder for the bottom 50%. (Obviously, these cutoffs are just sort of arbitrary...But, just trying to illustrate the point.)


Everyone has a right to complain about absolutely anything. Freedom of speech and all that. I only object to basing economic policies on envy.

Well, to be honest, I'd rather base economic policies on envy of the better-off by the less-well-off than base them on the greed of people who have done extraordinarily well in our society (sometimes in large part because of their own talents or, sometimes as in the case of our current President because of their "talent" of being borne into the right family, but always within the context of the society at large) and yet want to reduce the amount they pay back to the society in which they have succeeded so fabulously.

I think it is perfectly reasonable for those at the bottom...or in the middle...to ask how we want to structure our society in terms of how the benefits that accrue to the society are shared. For example, why should we be always trying to maximize the GDP, i.e., in essence the average income, rather than the median income? And, what sort of tradeoffs might we want to make. What if we could get slightly lower GDP growth but have 75% of the people be better off..significantly in some cases...than they are today? Might we not want to make that tradeoff? [Of course, Frank and Cook would make an even stronger argument by claiming that this tradeoff likely does not even exist...i.e., that if we pursued policies to mitigate "winner-take-all" effects, we would end up with less inequality and greater efficiency too. Whether this is true or not, I don't know but I don't think it has to be true in order to still decide as a society that we want to reduce...or at least not continue to increase...inequality.]


But this is the point I question. If we took all of the money that went to the top 1% (which I understand you are not advocating) and distributed it to the next 49% (I'm not going lower because the tax foundation site does not have numbers for them) we go from 5,000,000 to 6,000,000. Not much more of an improvement than the 10% you said "hardly made any difference".

I'm not sure exactly where you got this number from although I guess it doesn't sound too out-of-line. As I pointed out using the most recent CBO numbers today, the 15% improvement in real incomes at the median would have been 40% if all boats were raised the same fractional amount.

I don't think it takes much "spin" to ask whether we really feel that our society in 1979 had too much equality and whether we should pursue policies whereby the gains go in large part to those at the top...so that the % gain in real incomes is like 12 X higher for the top 1% than for the median...or whether we should pursue policies that, say attempt to keep this inequality from growing and thus allow the % gains at the median to be more than 2.5 times bigger than they were.

Actually, the current question we are facing is even stronger than that since essentially what Bush is telling us (in policy actions, not words of course) is that the increase in inequality seen in the last 20 years is insufficient and we want to see it increase even more. It reminds me of the slogan of the parody website setup by Citizens for a Fair Economy in 2000, www.billionairesforbushorgore.com, which had the slogan, "...Because inequality is not increasing fast enough..."

jshore
01-11-2004, 04:10 PM
Originally posted by pervert
But these percentage analysis are very misleading. For instance, look at the table labeled "Appendix Table 2" in your cite. It implies that the share of income increased for the top 1% and the top 5% only. It is a blatent attempt to suggest that these very wealthy groups got richer on the backs of the rest of us.

Well, I don't read it that way (depending on what you mean "by the backs of the rest of us"). I think the CBPP has clearly said that after-tax incomes rose for those at the median too, so all boats have gone up...But some much more than others and as a result wealth is increasingly concentrated at the top. Also, it is worth pointing out that some boats did actually go down in the 1980s (for the bottom two quintiles in fact...i.e., nearly half the population) when more aggressively pro-rich policies were pursued. Then in the 1990s, boats went up fairly equally (in percentage terms...obviously not in absolute dollar terms). Want to guess what happens under the policies of the current Administration?


And from the Tax Foundation link we were discussing earlier, we know that these groups grew in size as well. Which means that the per capita percentage increase in income is very misleading as to the total wealth that acrued to any given group.

Well, it seems perfectly reasonable to me to look at wealth per capita rather than wealth per group. The size of groups just increases because the population goes up. The top quintile always has 20% of the population in it.


This new cite does not give enough figures to tell for sure, but I suspect that even your last assumption is flawed. That is, if the wealth were distributed evenly throughout the population, I doubt very much that anything like a tripling for the median would have occured. The average income increase was calculated, unless I am mistaken, by averaging the increases by the various groups.

I am quite sure you are mistaken. The average income is the average income. You take all incomes and you average them. Note that if you divide into quintiles, take the average income of each group and then average that, you should get the same result. (You can prove that mathematically, I believe.) Clearly you can't do this if you are looking at different sized groups (e.g., if you were computing the average income of the top quintile by averaging the average income of the top 1% and the average income of the other 19%) but then noone would "average" in this way.


Unfortunately this also ignores the number of people in those different groups. As I said last time, if we were to take all of the money earned by the wealthiest 1% and give it to the rest of us it would not make a juge dent in this gap. The problem is that the "rest of us" are so numerous in comparison to the top 1% that distributing their wealth would not make much difference.

Not so fast. Notice that the top 1% saw gains 100X higher in absolute dollars than the median group saw. So, you take the $576,000 gain seen by each family in the top 1% and distribute that evenly to the entire 100% of the population and each family would reap $5760 which is slightly more than the gain that was actually seen at the median...I.e., you would slightly more than double the gain seen at the median if you distributed the gain seen at the top evenly, in absolute amounts, throughout the population!!! That's how dramatically the incomes of the top 1% have grown! I think that the more you understand how the mathematics actually works out, the more amazed you'll be about just what is going on.


As an aside, have you ever read Innumeracy by John Allen Paulos? I used to read news reports and studies most uncritically. Since I read that book, I never let a statistic pass unexamined.

I haven't read that book but I agree with you that it is important to study statistics critically. That is why it really irks me, for example, when the Wall Street Journal editorial page points out that the share of the federal income tax paid by the top 1% has nearly doubled in the past 20 years (which they seem to do about once a month) and implies that this shows how much more we are shafting them. In fact, what people fail to understand is that share data for the income tax paid measures not only the rate at which people are taxed but also their share of the income. The top 1%'s share of the income has increased even more rapidly than their share of the tax. So, what the WSJ is using to imply that the rich need tax relief really just shows the explosion in inequality! This makes their solution of giving the top 1% relief seem a bit less reasonable!

jshore
01-11-2004, 04:16 PM
Originally posted by jshore
It reminds me of the slogan of the parody website setup by Citizens for a Fair Economy in 2000, www.billionairesforbushorgore.com, which had the slogan, "...Because inequality is not increasing fast enough..."

Make that www.billionairesforbushorgore.org.

pervert
01-11-2004, 06:19 PM
Originally posted by jshore
I haven't read that book but I agree with you that it is important to study statistics critically. That is why it really irks me, for example, when the Wall Street Journal editorial page points out that the share of the federal income tax paid by the top 1% has nearly doubled in the past 20 years (which they seem to do about once a month) and implies that this shows how much more we are shafting them. In fact, what people fail to understand is that share data for the income tax paid measures not only the rate at which people are taxed but also their share of the income. The top 1%'s share of the income has increased even more rapidly than their share of the tax. So, what the WSJ is using to imply that the rich need tax relief really just shows the explosion in inequality! This makes their solution of giving the top 1% relief seem a bit less reasonable!

I promised you the last word on income disturbution, so I won't adress the rest of your post. We have done it a couple times in this thread. But I did want to note that I agree with you here. Conservatives make the same mistake liberals do, only in reverse. Claiming that 1% of wage earners pay more than 1% of citizens should ignores the portion of the income that this 1% of the population earns. Just like (but in the other direction) my objections to concentrating on the income gap without looking at population share.

pervert
01-11-2004, 07:09 PM
Originally posted by jshore
I don't see how that follows.What I am trying to say in my very bad way is that if you have a group of people all trying to succeed economically, they are all in the same environment, and one of them succeeds wildly greater than the others, then you have to find what was different about that one. Either he was more capable or the environment favored him in some way, or some combination of the two. I don't think the analogy to the lottery is apt, as that is clearly random chance. I doubt very much that economic success is so heavily reliant on luck. While it certainly makes a difference, it is not the overiding factor IMHO.

That is why I like my example of imagining Bill Gates in negotiation with society at large.The problem wiht this example is that you have to do the negotiation after the fact. It is easy to say now that society is entitled to a share of Bill Gate's fortune. But where was society when the risks were being taken? Why were there so few of us working in the computer industry in the late seventies? I would argue that we did negotiate with Mr. Gates back then. We said basically, "We won't help you much if you fail. But if you succeed we want a cut." It seems disengenuous to say now we want a much larger cut. (I understand the marginal tax rates are lower now than then, I am speaking figuratively.)

I am more talking at the margin.If you want to talk about corporate welfare I am all for gutting that as well. If you are only talking about some of the privileges that corporations seem to have I am willing to gut them also. As long as you are not talking about penalizing corporations for doing things that private citizens are allowed to do, I'm certainly willing to discuss it. We have to remember that a coporation is not some alien life form with no relation to private citizens. It is simply a group of citizens. I agree that grouping should not confer any special priveleges, as long as we agree that it should not inclue severe penalties.

Well, we have a very different view of the conditions faced by those people at the bottom.I'm not sure that our view is different. Our opinion about various solutions seems to be. But I do not believe that people at the bottom of society are happy and dancing. I do think that poor people in America have it quite a bit better than those in some other countries. But then we begin to compare apples and cumquats.

I think this is a very simplistic view of economic policy in this country to claim that it is simply set up to promote freedom. Agreed. It is a simplistic view. The point is that removing all of the power that the government has over economic activity may be just as valid a solution as granting it more power.

However, even if it is true that the market itself is promoting these vast inequities in wealth, it does not follow that we should not as a society decide to remedy them.I strongly disagree. Admitedly, some of the actions of the current economy do not resemble a free market. There is probably lot's of room to ensure that less fraudulent or even ill informed choices are made. However, simply to level the income rates just to level them relies on a premise that is certainly not true. It assumes a right, or equality of ability which is clearly not true.

Actually, I don't remember any numbers that directly addressed that.I was refering to the Tax Foundation cite again. It shows that while the top 1% AGI was 1,094,296 while the AGI for the top 50% was 5,379,286. Perhaps I misunderstood the numbers, but it certainly seems to me that most of the wealth went to the groups below the 1% rank.

Still, I think that it would be pretty hard to sell tax cuts for the top 1% with the slogan, "The top 1% need their taxes cut since they didn't even manage to capture 50% of the new wealth in our society over the last 20 years." We may have been talking at cross purposes here. I favor tax cuts. But I'm not as married to them as Bush seems to be. I was a little disapointed that he went throgh with his even though the dot com bubble burst. It seemed like it would be much more prudent to take the money and pay down the debt. Of course my use of prudent here only applies to fiscal policy, not political reality.

You may recall that we pretty much had our debt under control just a few short years ago. ;) Only by certain ways of calculating it. And only assuming economic growth that many knew could not continue indefinately.

As for "cut everything", that is the sort of statement that is easy to make but hard to implement.Agreed. Any cutting would be very hard to implement. But I still think accross the board cuts of 1% or even .5% a year would be easier than targeted cuts to this or that program.

Well, okay, while the top 1% has done most fabulously, I am not claiming that it is all due to them that housing prices are up. It's a more gradual issue as you go up the economic ladder. I.e., the top 10% are probably making it difficult in many locales for those in, say, the top 50% to be able to find nice affordable housing. And, the top 50% are making it harder for the bottom 50%. (Obviously, these cutoffs are just sort of arbitrary...But, just trying to illustrate the point.)Well I might be able to agree that the presence of the top 50% of income earners makes it harder for the bottom 50% to afford houses. Except, of course, that it is the people in the top 50% who would be investing in the construction companies. So, we might have a problem simply transfering that wealth around.

But I might point out that some government programs have a similar effect on the availability of low income housing. Slum laws and section 8 housing, in my mind tend to raise barriers to anyone who might otherwise want to build low income housing. I remember a story around here a few years ago about an entrepenuer who wanted to rent some slums. The buildings were seriously under code. They were not good places to live. But the people who wanted to rent them knew that. There was some good evidence that they were not retarded or so uneducated that they thought they were getting standard housing. However, since he was willing to rent them for 1/10th the rate that other housing went for, he had lots of takers. The government shut him down and kicked everyone out.

I understand the policies about safe housing. As I've said before, I'm not in favor of gutting all regulations. But I think it is important that we examine all of the costs of our regulations. And perhaps that we alow exceptions in certain very rare cases.

I'm not sure exactly where you got this number from although I guess it doesn't sound too out-of-line.From the tax foundation cite again.

Actually, the current question we are facing is even stronger than that since essentially what Bush is telling us (in policy actions, not words of course) is that the increase in inequality seen in the last 20 years is insufficient and we want to see it increase even more. It reminds me of the slogan of the parody website setup by Citizens for a Fair Economy in 2000, www.billionairesforbushorgore.com, which had the slogan, "...Because inequality is not increasing fast enough..." Ok, this is the crux of the situation. When liberals complain that the tax cuts favor the rich (which they do) they tend to ignore that the rich pay more (of the taxes in question). If we were talking about cutting sales taxes it would be different. Unfortunately, liberals seem to be so adamantly opposed to tax cuts of any kind that they can't offer this simple solution. How many liberals have been saying, "No we should not cut the federal income tax rate. We should cut the state sales and property tax rates." What they have been saying is that the Bush tax cuts amount to distributin wealth from the poor to the wealthy. To my mind this is just as dishonest as the conservatives saying that they want to cut taxes to benifit the economy in general. Your both talking different words out of each sides of your mouth to different constituencies.

Probably politics as usual though. ;)

Lissa
01-11-2004, 08:27 PM
Originally posted by pervert
I'm sorry, but this is insane. The purpose of bonds was not to allow people to make money? The purpose was not to invite investment? Investing in the city is a tax dodge???

I think you misunderstood my point. Yes, the purpose of bonds is to allow people to make money, but the idea is to have hundreds of small investors buying bonds in order to raise the funds. The idea is not to have several huge investors shovel huge sums of money into them in order to avoid paying taxes on it. As I said, through interest and loss of tax revenue, the city, or government actually loses money. If everyone did what those people are doing, the system would collapse quickly.

For the average, small-time bond buyer (like myself, actually) the amount invested in bonds doesn't make an appreciable difference come tax time in how much is paid out by the purchaser. It may be a small deduction, but it doesn't necessarily put them in a lower bracket, or represent a huge savings in how much they pay to the IRS. What the huge investors are doing is "hiding" money on which they would have to pay taxes in order to avoid doing so.

You do realize the bonds are not open ended, right? Its not like people can put any amount of money into bonds whether the city needs the funds or not. The city (usually) has to ask for a certain amount of money and only when people invest that amount do they get it. Once that amount is invested, no one else can buy bonds from that city.

Exactly my point. If John Moneybags hears that the city is about to offer bonds to, say, build a bridge, he and several of his wealthy cronies could ostensibly buy up all of the bonds, leaving the small investor out of the picture. And, again, the idea behind bonds is to have hundreds, if not thousands, of people investing small amounts, rather than a few investors stashing massive amounts of cash in order to avoid the taxman.

That is, the government has complete and total control of this "dodge". Citi bonds are tax exempt or tax defered to encourage people to invest in cities. It allows cities to raise funds which would be much harder otherwise.

Yes, I know this. But if having the bonds means that the city loses tax revenue as well as paying out interest, where does the city profit? As I said before, if everyone did this, the bond system wouldn't work.


It seems to me that your example is exactly the opposite of the hypothetical that adaher posed. He suggested that a significant cost to save 10 lives would be undesireable. You found an example where a trivial expense would have saved hundreds of lives.

Some would argue that a couple of hundred lives out of the total number of car buyers is nominal.

The economic analysis done by Ford concerning the Pinto was flawed in several respects. They compared the cost to the cost of lawsuits without good reason. The lawsuits could easily have been much higher than the numbers you quoted in the article.

Well, remember these are 1960s and 1970s dollars. Multi-million dollar lawsuits weren't as popular as they are today.

Are you sure that article is not merely quoting the lowest estimates? Also, the analysis failed to note that $11 dollars could easily have been passed on to the consumer, while the $5000 dollars in adaher's hypothetical could not.

Remember that Lee Iacoca was firm in keeping the cost of the car under $2000. In his opinion, the $11 cost couldn't be passed on to the consumer.

I feel I should point out, that the article you linked to was similarly flawed. It quotes many numbers of deaths by automobile fire but never once differenciates how many were due to Pintos verusus the rest of the automobiles on the road. It certainly never differenciates the nubmer due to rear end collisions. It does this, IMHO, in a disengenuous attempt to inflate the deaths attributable to Ford's bad decision.

Perhaps this is a betterarticle. (http://www.motherjones.com/news/feature/1977/09/dowie.html) It was written in 1977, and by then,

By conservative estimates Pinto crashes have caused 500 burn deaths to people who would not have been seriously injured if the car had not burst into flames. The figure could be as high as 900.

Continuing with what I said before about Iacoca:

Heightening the anti-safety pressure on Pinto engineers was an important goal set by Iacocca known as "the limits of 2,000." The Pinto was not to weigh an ounce over 2,000 pounds and not to cost a cent over $2,000. "Iacocca enforced these limits with an iron hand," recalls the engineer quoted earlier. So, even when a crash test showed that that one-pound, one-dollar piece of plastic stopped the puncture of the gas tank, it was thrown out as extra cost and extra weight.

People shopping for subcompacts are watching every dollar. "You have to keep in mind," the engineer explained, "that the price elasticity on these subcompacts is extremely tight. You can price yourself right out of the market by adding $25 to the production cost of the model. And nobody understands that better than Iacocca."

Having said all that, I think that Ford did the right thing in trying to analyse the costs of fixing the Pinto problems. They simply made several bad assumptions which invalidated the analysis.

Thecourt (http://www.ahcpr.gov/clinic/jhppl/jacob2.htm) in Grimshaw v. Ford Motor Co. disagrees with your opinion.

Through the results of the crash tests, Ford knew that the Pinto's fuel tank and rear structure would expose consumers to serious injury or death in a 20-to 30-mile-per-hour collision. There was evidence that Ford could have corrected the hazardous design defects at minimal cost but decided to defer correction of the shortcomings by engaging in a cost-benefit analysis balancing human lives and limbs against corporate profits. Ford's institutional mentality was shown to be one of callous indifference to public safety. There was substantial evidence that Ford's conduct constituted "conscious disregard" of the probability of injury to members of the consuming public.

Let me turn the question around on you. Do you think that any expense is acceptable if it will save even 1 life? If so, why do you not call for the immediate and indefinate banning of automobiles until we can find a way to save the 50,000 people who die each year in them?

Are the 50,000 people being killed by a faulty product, or by accidents involving other drivers?

It's my opinion that a company has the obligation to ensure that it's product will operate safely during its intended use. A company is ethically in the wrong if they know their product can cause injury or death to the unsuspecting consumer who is using it properly.

For example, the makers of a lawn mower have an obligation to ensure the blade will not suddenly fly off, possibly decapitating someone. (They do not have any obligation to ensure the safety of an idiot who sticks his hand into the undercarriage while the mower is in operation, because he is clearly warned not to do so.)

If the manufacturer cannot ensure that the blade will not spontaneously fly off, then they should not sell the product. If the bolt which will keep the blade in place adds $100 to the cost, then that's the problem of the manufacturer. If they cannot figure out how to make their product safely within the cost limits, then apparently, they're going to have to start from scratch and re-design. If they cannot do so, then they're in a heap of trouble, but they should not endanger the consumer because of their mistakes.

To foist the product off on the unsuspecting consumer, and coldly determine that paying off the lawsuits will be cheaper than fixing the problem is just plain wrong, in my opinion. It shows "gross indifference", and, as the court said, "concious disregard" for human life.

And it's never a matter of just one life, or even just ten lives. If a product is inherently dangerous, it's impossible to put an exact number on how many people will be injured or killed by it.

pervert
01-11-2004, 09:03 PM
Originally posted by Lissa
the idea is to have hundreds of small investors buying bonds in order to raise the funds.You said this before and repeated it again twice in this last post. Can you defend it or is it simply anassertion?

As I said, through interest and loss of tax revenue, the city, or government actually loses money.But this is entirely in the hand of the issueing government. If they offer $100,000 in tax free bonds, they know up front that they will be offering to remove $100,000 from the tax base as well as promising to return that money plus interest. They only lose money if they offer more bonds than they have tax base. Who buys the bonds makes not difference. Unless you are saying that poor people over report their income as a class.

If everyone did what those people are doing, the system would collapse quickly.As I indicated this is impossible since the amount available in bonds is not infinite.

But if having the bonds means that the city loses tax revenue as well as paying out interest, where does the city profit?Well, they make a profit by having use of the funds now instead of having to save them up. It has to do with the time value of money. $10 right now may be worth more to me than $100 2 months from now. Therefore, I may be willing to go get a loan and be willing to pay it back with interest. Municipal bonds are simply a way for a city to borrow money.

Well, remember these are 1960s and 1970s dollars. Multi-million dollar lawsuits weren't as popular as they are today.Yes. So their numbers propbaly were not made up out of whole cloth. They were probably based on the idea that only certain people would drive Pintos. When suing for wrongful death the courts sometimes calcualte a lifetime earnings. This is used to place a value on the suit (not exactly to place a value on the life). However, this analysis was shown later to be in error. All I meant was that they should have looked at the numbers more critically.

Are the 50,000 people being killed by a faulty product, or by accidents involving other drivers?Yes.

It's my opinion that a company has the obligation to ensure that it's product will operate safely during its intended use. A company is ethically in the wrong if they know their product can cause injury or death to the unsuspecting consumer who is using it properly.So, rear ending pintos is their intended use?

Thecourt in Grimshaw v. Ford Motor Co. disagrees with your opinion.Quite so. But that is not the end of the discussion on economic considerations. From you own cite:

Practically speaking, the effect of RUA has been to bring strict liability cases for product design defects closer to the standards used in traditional negligence cases. When striking a balance between risk and utility, at some point the consideration of cost must come into play, and some courts have ruled that CEA is an integral part of RUA. In Proes v. Honda Motor Co. (31 F.3d 543 [7th Cir. 1994]), for instance, the plaintiff claimed she had been thrown from her car during an accident due to the failure of a defectively designed seat belt (see also, Prentis v. Yale Manufacturing Co., 427 Mich. 670, 688 [Mich. 1984]). The court noted that to prove the defendant's negligence, the plaintiff needed to show that another seat belt design "not only could have prevented the injury but also was cost-effective under general negligence principles" (i.e., that there were no other alternatives that were more cost-effective).
So some times the court has ruled that cost analysis are appropriate. I would argue that the case law regarding this is relatively recent. The courts have not settled one way or another. Nor have they settled on a good way to judge on analysis from another. If the Pinto case occured at the begining of this debate, it would not be surprising to ultimately decide that Ford was in error, and that the court was overly punitive.

I am not saying that everything that Ford did was correct. I am simply saying that looking at the economics of teh proposed safety changes was not in and of itself wrong. I agree that it was wrong to avoid the $11 dollar change. But of course, we have hind sight on our side.

pervert
01-11-2004, 09:08 PM
I should point out that I agree with the bulk of your position concerning liability. If a company sells a lawn mower, it should sell lawn mowers, not human quisenarts. However, they should not be responsible for people hurt using their product as fencing tools.

Evil Captor
01-11-2004, 11:48 PM
Re: Bill Gates. Read the book "Hackers." The record is very clear: Gates was not a genius programmer or anything close to it, though he was quite good. When he started in computers he had come up with a condensed version of BASIC to be used for the very limited computing power of the 8088 chips then used in personal computers. He just happened to be one of the people IBM approached by IBM when they were looking for an operating system for their entry in the home computing marketplace. He turned them down at first, recommending that they go to CP/M. the folks who owned CP/M weren't willing to deal on IBM's terms, and in those days, that was the only way to deal with IBM. Gates' genius consisted in realizing how beneficial it would be to be the one who created the operating system for IBM, so he created DOS, which was pretty much a direct steal of CP/M and got the IBM contract.

Later, he created Windows, which was pretty much a direct steal of the MacIntosh OS.

Gates is a brilliant example of the "Winner Take All" syndrome, because the home computer revolution was created by a lot of different people, many of whom have done well, some of whom have done badly, but it can reasonably be argued that Gates has been rewarded far, far, FAR beyond his personal "contribution" to the personal computer industry, and that a lot of greedy dogs with moderate computing know-how could have made the exact same "contribution."

Why Gates and not another? I would say he was in the right place at the right time, but that if it hadn't been him, it would have been someone else.

Guinastasia
01-11-2004, 11:56 PM
That's right, as FENCING tools, pervert!

But if someone uses the product the way it was intended and it still has a high risk of causing serious injury, do you honestly believe the manufactorer is NOT responsible?

pervert
01-12-2004, 12:10 AM
What did I say? Did I not say that if you use a thing as intended it should work as intended? Did I not say that Ford made many mistakes in its anlysis of the problems with the Pinto? Are you saying that 30MPH rear ends are the proper use of Pintos? While it is certainly forseeable that such collisions could happen. And I certainly agree that Ford did not take enough precautions against them. You cannot extrapolate this case to mean that no one should ever consider the economics of a particular safety measure.

I realize that you guys are trying very hard to demonstrate something. I'm just not sure what it is.

pervert
01-12-2004, 12:18 AM
Originally posted by Evil Captor
Why Gates and not another? I would say he was in the right place at the right time, but that if it hadn't been him, it would have been someone else. Again, this is all very easy to say in hind site. When he left school to move to New Mexico to become part of the microchip revolution, he was taking a great risk. Through dilligence and work it paid off. Certainly lots of others were involved with the computer revolution. They were all free to make the same choices Bill did. They could even have invested in his company back then if they wanted to. We all chose not to. We certainly did not offer to make good his investment if his plan did not work out.

I am not suggesting that he does not owe taxes. Just that it is a little disengenuous to say now after his plan worked while so many plans failed that his success is due mostly to the rest of us. Why don't we go look up the oner of CP/M and offer to pay him back his investment? Why don't we go to the preveous owner of DOS (which bill Gates purchased) and offer to make up some of his losses for not jumping more firmly on the Microsoft bandwaggon?

That's ok, I understand why. ;)

pervert
01-12-2004, 12:23 AM
DOH! Hind sight obviously.

Evil Captor
01-12-2004, 07:26 AM
We're getting to the heart of the disagreement now. You see Gates' success as the result of HIS hard work, HIS intelligence, HIS persistence.

What I think happened was this: conditions were right to make SOMEBODY very rich from the home computer industry. A LOT of hobbyists and scientists and engineers made their individual contributions that made the home computer industry what it was both before and after Bill Gates came along. Some like Larry Ellison and Steve Wozniak, were rewarded lavishly. Some like the inventors of Visicalc and the Altair computer, didn't get much monetary reward at all.

But it wasn't because Gates performed some miraculous service that helped everybody that he got to be so fucking rich. It was the "Winner Take All" effect that's already been referred to. Gates was rewarded in sums that are whole orders of magnitude beyond his contribution. I seem him as more like a lottery winner than a super-inventor. And while the lottery is at best a fun and entertaining way to blow a few bucks a week, it's no basis on which to rest an economic system.

adaher
01-12-2004, 07:29 AM
It's the best so far. Gates and thousands of other Microsoft employees and thousands of investors are today quite wealthy. I can think of no other system that would allow for such a thing to happen.

pervert
01-12-2004, 09:07 PM
Some like Larry Ellison and Steve Wozniak, were rewarded lavishly. Some like the inventors of Visicalc and the Altair computer, didn't get much monetary reward at all.Right. But the difference cannot be reduced to mere chance. The inventors of visicalc did not seek to profit from their development. The inventor of the Altair did not suucceed in seeing the need to make his computers easier to use.

But it wasn't because Gates performed some miraculous service that helped everybody that he got to be so fucking rich. It was the "Winner Take All" effect that's already been referred to. Gates was rewarded in sums that are whole orders of magnitude beyond his contribution.Well, that is because you don't understand his contribution. You are stuck focussing on the direct value of his individual labor. You are ignoring the leverage effects of cooperative activity. If you add up the hours he worked, or look at your assesment of the value of the code he actually wrote, then you might conclude that his contribution was quite small. But his contribution was not one of code written, or hours worked. His conribution was in recognizing the business opportunity represented by personal computer software. Small in the big scheme of things. But miraculous enough for those of us who use computers every day.

Personally, I don't understand the objection to "winner take all". As I have tried to explain you have to look at the building of a business or industry at the begining, not at the end. (Referencing the OP) if you look at the means of production as a fait accompli, then you can argue dialectically how best to use them. But once you realize that industries have to be built before their value is knowable, you realize that such activity is too risky for most people to participate in.

For instance, if you want to compare the economy to a lottery, then you have to conceed that it is not 1 loterry, but an almost infinite number of them. You can't win if you don't play, and you can't win unless you choose the correct lottery to play in. Furthermore, playing does not amount to buying a trivially priced ticket. You have to invest large sums of money and time up front. You have to constantly watch that your ticket is for the lottery you want to be a part of (it can change from second to second without your control), and you may have to continually invest to keep your ticket valid. Other than that, economic activities have some resemblance to lotteries.

But even if they have more resemblance than this. We don't go around claiming that lottery winners winnings aren't theirs. We don't go around claiming "Hey, I bought a lottery ticket too. I deserve some of your winnings."

Lissa
01-13-2004, 01:42 AM
You said this before and repeated it again twice in this last post. Can you defend it or is it simply anassertion? [/b]

It's an assertion, but I'd gander to say it's a very logical one.

But this is entirely in the hand of the issueing government. If they offer $100,000 in tax free bonds, they know up front that they will be offering to remove $100,000 from the tax base as well as promising to return that money plus interest. They only lose money if they offer more bonds than they have tax base. Who buys the bonds makes not difference. Unless you are saying that poor people over report their income as a class.

But my point is that, yes, it removes $100,000 (which is an extremely low bond issue, I believe) but the buyers are most likely still paying taxes on the rest of their income. When a person invests all of their taxable income into the bonds, they remove themselves from the tax base.


As I indicated this is impossible since the amount available in bonds is not infinite.

Yes, I understand this.

Well, they make a profit by having use of the funds now instead of having to save them up. It has to do with the time value of money. $10 right now may be worth more to me than $100 2 months from now. Therefore, I may be willing to go get a loan and be willing to pay it back with interest. Municipal bonds are simply a way for a city to borrow money.

Yes, but cities generally don't invest bond money. They usually use it for munincipal projects, like bridges and parks which don't bring them any income. They expect to be able to repay the bonds and interest out of future taxes. However, my point is that if the wealthy exempt themselves from paying any taxes by buying the bonds, then it makes it much more difficult for the city to do so.

Yes.[50,000 a year are being killed by faulty automibiles.]

Then, in my opinion, the producers of the automobiles should be required to recall their product and to pay compensatory damages to those already injured. If they continue to make the automobile knowing that it is dangerous, they should not only be civilly liable, but criminally.

So, rear ending pintos is their intended use?

In a way, yes. The manufacturer of automibles should expect that fender-benders and more serious accidents can occur. They cannot be held responsible for the death of a motorist caused by a 90 MPH crash, because it is not reasonable to expect a car to withstand such incredible stresses. However, a 30 MPH crash does not involve these kinds of forces. You should reasonably expect to be able to walk away alive after such a crash.

I'm not saying that everything that Ford did was correct. I am simply saying that looking at the economics of teh proposed safety changes was not in and of itself wrong. I agree that it was wrong to avoid the $11 dollar change. But of course, we have hind sight on our side.

Yes, we do have hind-sight, but I cannot fathom that even in the "heat of the moment" that I could decide that people being burned alive was better than losing money. That's not just ethically wrong, it's evil. It's my opinion that not only should the company have been sued, but the perpetrators should have been criminally prosecuted.

Lissa
01-13-2004, 01:48 AM
Please ignore the signature in my post.

pervert
01-13-2004, 01:25 PM
They expect to be able to repay the bonds and interest out of future taxes. However, my point is that if the wealthy exempt themselves from paying any taxes by buying the bonds, then it makes it much more difficult for the city to do so.But this is not true. If a city taxes an economy of 1,000,000 and issues a bond of 100,000, then they know at the time of the bond issue that the 100,000 will reduce the tax base by that amount. It make absolutely no difference if the 100,000 comes from 1 person or 5 or 100,000. The ability to repay the bond is not altered in any way.

So, there are no deliterious effects from a single person buying bonds and lowering his tax burden to 0. Given that, it still seems unfair to criticize someone for dodging taxes when they are in fact loaning money to the city for things the city needs.

Yes, we do have hind-sight, but I cannot fathom that even in the "heat of the moment" that I could decide that people being burned alive was better than losing money. That's not just ethically wrong, it's evil. It's my opinion that not only should the company have been sued, but the perpetrators should have been criminally prosecuted.That's because you are being overly reactionary to the concept. If you simply modify your statement above to mean that any amount of money, then you can justify shutting down civilization. Literally everything we use to survive has risks. Many of them could be lessened if we spent unlimited amounts of money to do so. Unfortunately this would result in making them unusable. For instance we could save 50,000 people a year by banning cars. We would have more land by getting rid of the roads, and some polution would be reduced. However, we would have to ship goods either with human or animal power. If you think that cars polute the environment, imagine moving all those things around using horse drawn carts. Some cities could not exist like that. The whole point being that you have to look at the costs when considering any sort of engineering change. Like anything else, this can be done well or it can be done poorly. But the only evil thing is not to do it at all.

BTW, I did not say that 50,000 people die due to defective cars. I said that they die due to "faulty product, or by accidents involving other drivers?" That is the deaths occur for both reasons. The question is whether the companies took reasonable precautions to prevent deaths or injuries. In Ford's case, the answer was no. Not because they did a cost analysis, but because the analysis was faulty.

It's an assertion, but I'd gander to say it's a very logical one.Well, I'm not sure that it is very logical. It is certainly reasonable. If you ever have you own city and wish to change the system to require lots of small investors, I would not object. But it does not seem logical to apply motives to others actions without evidence. So, if it is your opinion that bonds should be purchased by small investors, thats cool. But if you believe that this is one of the original ideas behind municipal bonds, you need to have more evidence.

jshore
01-13-2004, 07:17 PM
Personally, I don't understand the objection to "winner take all". As I have tried to explain you have to look at the building of a business or industry at the begining, not at the end. (Referencing the OP) if you look at the means of production as a fait accompli, then you can argue dialectically how best to use them. But once you realize that industries have to be built before their value is knowable, you realize that such activity is too risky for most people to participate in.

Well, one problem with this winner-take-all society is that we have a system in which vast inequalities are generated because a few people are rewarded vastly out of proportion with their contributions to the society. And, even if this doesn’t bother you on the basis of the inequality aspect, what Frank and Cook argue in their book is that the “winner-take-all” markets lead to economic inefficiencies. So, the claim is that we should be able to get better efficiency and less inequality if we implement reforms (with more progressive taxation being one of them) to try to lessen the winner-take-all nature of the system. It seems to me that if Frank and Cook were correct, taking steps to correct things would be a win-win situation (unless one actually likes vast inequality just for the fun of it).

As for the specific example of Bill Gates, you seem to imply that there were few if any other people who were willing to take the sort of risks that he took. Is there really any evidence that this is the case? I.e., do you really believe the computer revolution would have been seriously set back without Gates? My impression was that his main genius was in realizing that if you were the first to market with a software product / operating system, even if it was quite defective and buggy, and were thus able to get people to buy it, then you could reach a critical mass whereby it would become a standard and others would then be pressured to buy it. (In that regard, I sometimes wonder if the society would actually have been better off without Bill Gates. But, that is an argument for another day!)


We don't go around claiming that lottery winners winnings aren't theirs. We don't go around claiming "Hey, I bought a lottery ticket too. I deserve some of your winnings."

But do we really want to run our economy like a huge lottery?!? I don’t really see this as very advantageous. And, what makes it even more irksome to me is that, as our society is currently structured, it would be (or is?) a lottery where some people were born with money to purchase thousands of tickets whereas others could just afford one!

pervert
01-13-2004, 07:52 PM
Well, one problem with this winner-take-all society is that we have a system in which vast inequalities are generated because a few people are rewarded vastly out of proportion with their contributions to the society. And, even if this doesn’t bother you on the basis of the inequality aspect, what Frank and Cook argue in their book is that the “winner-take-all” markets lead to economic inefficiencies.These objections rely on two assumptions which I'm not sure are valid. The first is that you are judging an individuals contribution after the fact in a way which is IMHO not fair. A person participates in economic activities with other free agents each of whom is free to judge his contribution to them. If enough people judge that person or his agents contribution worthy of monetary reward, then he is rewarded fabulously. You are trying, again after the fact, to apply some sort of hourly wage or component value to his work. The fact that each of his customers judged the work seems to have fallen out of your analysis.

Secondly, market "efficencies" make a similar mistake by assuming a group, societal, or socialistic goal. The goal of economic activity in a free market is individual fulfillment, not group fulfilment.

I will add, of course, the caveat that I am assuming free choice on the parts of the participants. This is not always true. However, we are arguing the benifits or pitfalls of the theories, so I think I can take the liberty.

As for the specific example of Bill Gates, you seem to imply that there were few if any other people who were willing to take the sort of risks that he took. Is there really any evidence that this is the case?No, that is not exactly what I am arguing. I agree entirely that someone would have taken his place if Bill Gates had not. However, this person would have had to have a similar vision (that micro processors, and micro processor software in particular, would be a large market in the future) before anyone else did. He would have had to put in quite a bit of work to develop his vision. He would have had to have a good bit of timing and luck as well. In short, if the founder and leader of Microsoft were named Evil Captor right now, I would be saying the same things about what he owned and what he did not.

Another way to put it is to realize that even though someone else could have done what Bill Gates did, it does not follow that anyone could have done it. And it certainly does not follow that everyone is entitled to a piece of his wealth.

But do we really want to run our economy like a huge lottery?!?But this is my point exactly. The economy is not a lottery at all. I was only arguing that even if it were, we would still talk about winnings as if they acrued to individuals. Instead what you are proposing is that we view the labor of an individual as belonging to society as a whole in somehow, and therefore subject to confiscation at societies whim.

Personally, I think there is a lot more justification for taxes and even wealfare programs on the basis of increased benifits or decreased pain. I agree it is hard to fully justify unlimited progressivness with these concepts, but I still think some could be justified. Something along the lines of noting that the benifit gained by property increases non proportionally to the amount of property. Therefore the benifits provided by the state are non proportionally utilized by property owners. As long as we don't go too far and suggest property tests for sufferage, or representation proportional to property, I think this theory could be used to justify the sorts of taxes we are talking about. It certainly has the advantage of not requiring a change to the notion that an individual's life, and therefore his labor belong to him. Course, I'm just sort of blabbering at this point.

Lissa
01-14-2004, 03:13 PM
But this is not true. If a city taxes an economy of 1,000,000 and issues a bond of 100,000, then they know at the time of the bond issue that the 100,000 will reduce the tax base by that amount. It make absolutely no difference if the 100,000 comes from 1 person or 5 or 100,000. The ability to repay the bond is not altered in any way.

So, there are no deliterious effects from a single person buying bonds and lowering his tax burden to 0. Given that, it still seems unfair to criticize someone for dodging taxes when they are in fact loaning money to the city for things the city needs. [/b]

I see that we're not going to agree on this. We simply don't see the issue in the same way. Perhaps it's just my opinion, but I believe that the city does suffer some deleterious affects from the wealthy avoiding their share of the tax burden by taking advantage of bond programs.

It may seem unfair to you, but I feel that's it's equally unfair for them not to pay taxes, when Average Joe couldn't accomplish the same thing due to his smaller income. (Of course, life isn't fair-- I know this.) And Average Joe feels his tax burden more than does a man who wouldn't really miss a million or two.

Well, I'm not sure that it is very logical. It is certainly reasonable. If you ever have you own city and wish to change the system to require lots of small investors, I would not object. But it does not seem logical to apply motives to others actions without evidence. So, if it is your opinion that bonds should be purchased by small investors, thats cool. But if you believe that this is one of the original ideas behind municipal bonds, you need to have more evidence.



You're right, I have no evidence. I wouldn't even know where to look. It just seems "reasonable" to me that the idea would be to spread the "loan" out among many investors, so that they can get the benefits of interest, and so that the burden to paying for the city's projects does not fall on the shoulders of a few alone.

However, I have a strong suspicion that the motivations of those who stash away huge sums of money into bonds is not civic pride. Call me a cynic, but it seems pretty obvious what the motive of such a person is: to avoid paying taxes. They're most likely not buying bonds out of the goodness of their hearts.

Whatever it makes me, I'm a person who believes that everyone should do their part. We all benefit from city services: we use the same cops, firemen, and ambulances. We enjoy the same public facilities: parks, memorials, bridges and street lights. We should all pay for them.

To me, those who invest in order to avoid paying taxes are shirking their duty, even though they are "loaning" the city money. After all, they ostensibly remove themselves from paying Federal taxes as well, because all of their taxable income is in the bonds. So, in a way, they are putting more of the burden of paying for Social Security, schools, NASA, welfare programs, and myriad other expenses on the shoulders of those who are not rich enough to avoid paying their share by hiding their income in bonds.

Perhaps this is all philosphical. I'm willing to accept that. As I said, I think everyone should have to pay their fair share, but I know that such loopholes will always exist. They will always exist because the people that create our laws are generally rich people themselves, who want to be able to exploit them for their own benefit.

That's because you are being overly reactionary to the concept. If you simply modify your statement above to mean that any amount of money, then you can justify shutting down civilization. Literally everything we use to survive has risks. Many of them could be lessened if we spent unlimited amounts of money to do so. Unfortunately this would result in making them unusable.

I know that everything has dangers. Mistakes can be made. A company can unknowingly issue a dangerous product, causing injury or death to the consumers. However, it ceases to be a mistake and becomes [i]intentional when a company continues to make a product knowing that it can kill someone. It's that intent which I believe should be a criminal offense.

I'm not talking about a lava lamp which may leak and stain the rug. Nor am I talking about a folding stroller which may pinch the fingers of someone who is storing it. I'm talking about a product which can seriously injure, or kill its user through no fault of their own.

For instance we could save 50,000 people a year by banning cars. We would have more land by getting rid of the roads, and some polution would be reduced.

But that's not what I'm talking about. Deaths from pollution or car accidents are indirectly related to the product. What I'm talking about is an exploding car.

However, we would have to ship goods either with human or animal power. If you think that cars polute the environment, imagine moving all those things around using horse drawn carts. Some cities could not exist like that.

In a way, horses cause more pollution than automobiles. Frankly put, they shit, and they shit a lot. Back in the 1800s, the streets were indescribably filthy. During wet weather, they became pig sties of ankle-deep manure. In dry weather, powdered feces floated through the air. Cities stank abominably. (Oscar Wilde once said that the stench of Cincinnati, Ohio was powerful enough to "make granite eyes weep.")

But, again, we're not talking about indirect harm, like pollution. We're talking about faulty products.

The whole point being that you have to look at the costs when considering any sort of engineering change. Like anything else, this can be done well or it can be done poorly. But the only evil thing is not to do it at all.

I disagree. It is evil to produce a product with the full knowledge that people will die or be seriously injured from using it, having decided that your profits are more important than fixing the problem. If there's a hell, those kind of people are heartily deserving of it. Call me a bleeding-heart if you will, but in my opinion, if the company goes bankrupt in trying to fix the product, it's damn well worth it. After all, it's their fault the product was faulty.

pervert
01-14-2004, 04:36 PM
I see that we're not going to agree on this. We simply don't see the issue in the same way. Perhaps it's just my opinion, but I believe that the city does suffer some deleterious affects from the wealthy avoiding their share of the tax burden by taking advantage of bond programs. Clearly. But I don't think it is only a difference of opinion. You think tax deffered bonds are bad which is cool. The part I am disagreeing with you on is the why. Can you list a couple deleterious effects caused by wealthy people buying bonds as opposed to poor people buying the same bonds? Remember that the tax pool is reduced by the same amount. So, the city gets the same amount of money today and later when they have to pay off the bonds.

when Average Joe couldn't accomplish the same thing due to his smaller income.If we assume that the untaxable income is $20,000 (I know this is not the right number, but it is close and very round so I'm using it). A person with an income of $1,000,000 needs to buy a LOT more bonds than a person with an income of $28,000 in order to avoid paying taxes. So this seems like another assertions without a basis. Did I miss something?

However, I have a strong suspicion that the motivations of those who stash away huge sums of money into bonds is not civic pride.I did not mean to suggest that buying bonds was similar to giving to a charity. I was only suggesting that it was also not similar to stashing money in secret Caribbean accounts.

We should all pay for them.Of course. And one way we pay for them is to buy bonds. Governments don't sell bonds simply to give rich people safe investments. They do it to raise money.

So, in a way, they are putting more of the burden of paying for Social Security, schools, NASA, welfare programs, and myriad other expenses on the shoulders of those ...Yes, but they are reducing the burden of those of us who pay taxes today. We can argue whether or not deficit spending is a good idea. I personally don't like it. But if governments did not sell bonds, they would only be able to afford those programs which direct taxes could pay for. If we had to try and save tax money every time we wanted a new park or to upgrade the old ones, we would have to play in empty fields.


They will always exist because the people that create our laws are generally rich people themselves, who want to be able to exploit them for their own benefit. This, again, is an unfounded assertion. Bonds are issued to the people at large. There are very few restrictions to buying them. If rich people wanted to restrict them, they could simply require they be purchased in large lots. Or any other restriction which would have the effect of shutting poor people out of the market. They do not. In fact, they encourage as many people as possible to buy bonds. That is the reason for the tax defferel in the first place. Bonds do not offer a good return on money compared to other investments. They make up for this by being far safer than almost every other form of investment and by offering tax defferal.

However, it ceases to be a mistake and becomes intentional when a company continues to make a product knowing that it can kill someone. It's that intent which I believe should be a criminal offense.Like cars. We know for a certainty that 50,000 people will be killed in cars next year. Do you seriously propose that car manufacturers be put out of business?

Nor am I talking about a folding stroller which may pinch the fingers of someone who is storing it. I'm talking about a product which can seriously injure, or kill its user through no fault of their own.Right, but you are arguing that we should ignore the probabilities involved. That stroller putter awayer might get infected, have to go to the hospital and die from that stroller. In fact, given the number of strollers in this country, I'd say that is almost a certainty that someone will die in this way some time in the next 10 years. Should we ban stollers to prevent it?

Deaths from pollution or car accidents are indirectly related to the product.Right like deaths related to rear end collisions. Another word for collisions is "accidents".

I disagree. It is evil to produce a product with the full knowledge that people will die or be seriously injured from using it, having decided that your profits are more important than fixing the problem.But again, you are unwilling to look at the numbers. If the problem is incredibly small and the fix is incredibly expensive, then your assertion is silly. The only way to know either situation is to measure what the risk is and what the cost is. Now, I agree that we have to have laws which require reasonable measures be taken to ensure that a product is safe. And I maintain that our present laws do a pretty good job of that. However, you are making an emotional argument that even a single death is too many. This is not true.

I'm sure you've heard of the power source that we could put to most American homes to reduce our dependance on foriegn oil. It could be piped direcdtly to homes similarly to electricity. It could be used to power many of the major appliances we use in our homes. If it were done, it would significantly reduce (although not eliminate) our reliance on foriegn oil. Of course, a few people would die each year as a result of using it. The benefit to America would be immense. But it would cost a few lives each year. Should we use it?

Lissa
01-15-2004, 12:06 AM
Clearly. But I don't think it is only a difference of opinion. You think tax deffered bonds are bad which is cool. The part I am disagreeing with you on is the why. Can you list a couple deleterious effects caused by wealthy people buying bonds as opposed to poor people buying the same bonds? Remember that the tax pool is reduced by the same amount. So, the city gets the same amount of money today and later when they have to pay off the bonds.

Again, they are not only removing the total value of the bonds from the tax base, but their entire taxable income.

I buy bonds myself. About ten percent of my income goes into them. If I itemized, and took that off of my taxes, I'd still be paying on the other 90%. (But I don't itemize, so I don't get that savings, anyway.)

If I were independantly wealthy, and could live off of the tax-free interest on my investments, I could put 100% of my taxable income into the bonds, and pay no tax at all.

If, say 300, "poor" people buy the bonds, they, too, are still paying taxes on the rest of their income. But, if five "rich" people buy all of the bonds, they remove themselves from the tax base.

If we assume that the untaxable income is $20,000 (I know this is not the right number, but it is close and very round so I'm using it). A person with an income of $1,000,000 needs to buy a LOT more bonds than a person with an income of $28,000 in order to avoid paying taxes. So this seems like another assertions without a basis. Did I miss something?

Just the fact that a person making under $28,000 is highly unlikely to be buying bonds in the first place. People making that little often need every cent of their income just to pay day-to-day expenses. A millionaire who can stash away all of his taxable income in bonds is unlikely to feel the pinch.

Of course. And one way we pay for them is to buy bonds. Governments don't sell bonds simply to give rich people safe investments. They do it to raise money.

But they can be abused. Surely you don't think that the idea of a person stashing all of their taxable income into a bond is what the issuers intended?

This, again, is an unfounded assertion. Bonds are issued to the people at large. There are very few restrictions to buying them. If rich people wanted to restrict them, they could simply require they be purchased in large lots.

Well, that would be stupid. That would be tantamount to a declaration that they don't want the poor making investments. No politician would do that.

My point was that there could be restrictions on the amount that can be invested in tax-free investments to keep people from dodging the taxman, but politicians won't do that. They want themselves, their family, or their friends (or campaign contributors) to be able to use those loopholes.

Or any other restriction which would have the effect of shutting poor people out of the market. They do not. In fact, they encourage as many people as possible to buy bonds.

How would putting a restriction on the amount of income a taxpayer can invest harm the poor in any way? As I pointed out before, someone making less that $28,000 is highly unlikely to be able to invest at such a rate as would make them exempt from paying taxes.

As you pointred out, the number of bonds is finite. Blocking the wealthy from investing all of their taxable income would free up more bonds to be purchased by the small-time investor.


That is the reason for the tax defferel in the first place. Bonds do not offer a good return on money compared to other investments. They make up for this by being far safer than almost every other form of investment and by offering tax defferal.

Exactly. The wealthy could by Microsoft stock, but they'd have to pay capital gains tax. Often, it is worth more to them to avoid paying taxes than any investment could earn them.

Like cars. We know for a certainty that 50,000 people will be killed in cars next year. Do you seriously propose that car manufacturers be put out of business?

If they are intentionally issuing a product which they know is seriously flawed, then yes sir, they should be.

Right, but you are arguing that we should ignore the probabilities involved. That stroller putter awayer might get infected, have to go to the hospital and die from that stroller. In fact, given the number of strollers in this country, I'd say that is almost a certainty that someone will die in this way some time in the next 10 years. Should we ban stollers to prevent it?[quote]

No, because the infection is an indirect result. Now, if that same stroller had a propensity to collapse and decapitate the baby inside, it should be banned.

[quote]Right like deaths related to rear end collisions. Another word for collisions is "accidents".

As I said before, a manufacturer is not liable when a car travelling at 65 is involved in an accident and the occupant is killed. There are incredible stresses and forces involved in such a crash.

But, you should reasonably expect to be able to walk away alive if you car gets bumped from behind at 30 MPH. Hell, just last year, I was hit at a dead stop from behind by a car going 65. I walked away with no more than a severe case of whiplash.

I would not blame my contractor if the new house I built collapsed on me as the result of a tornado, but I damn sure would blame him if a stiff breeze blew it over.

I would not blame the airline if someone I loved died in a plane crash because of pilot error, but I would blame them if they knew that the plane was likely to fail but sold tickets anyway.

I would not blame the manufacturer of an appliance if I were electrocuted because I dropped the item into a tub of water, but I would blame them if it electrocuted me when I simply plugged it in.

But again, you are unwilling to look at the numbers. If the problem is incredibly small and the fix is incredibly expensive, then your assertion is silly.

An "incredibly small" problem does not kill or maim the consumer.

The only way to know either situation is to measure what the risk is and what the cost is. Now, I agree that we have to have laws which require reasonable measures be taken to ensure that a product is safe. And I maintain that our present laws do a pretty good job of that. However, you are making an emotional argument that even a single death is too many. This is not true.

A single death when the company is knowledgeable of the defect and unwilling to fix it because it will affect their profits is unacceptable. Are you willing for that single death to be your wife, or your mother?

Speaking of which, do you think the Ford executives let their kids drive Pintos?

I'm sure you've heard of the power source that we could put to most American homes to reduce our dependance on foriegn oil. It could be piped direcdtly to homes similarly to electricity. It could be used to power many of the major appliances we use in our homes. If it were done, it would significantly reduce (although not eliminate) our reliance on foriegn oil. Of course, a few people would die each year as a result of using it. The benefit to America would be immense. But it would cost a few lives each year. Should we use it?

Explain further: would people die because the design was faulty, or from causes like allergies? What, exactly, would kill them?

pervert
01-15-2004, 12:56 PM
Again, they are not only removing the total value of the bonds from the tax base, but their entire taxable income.But this is not true. In this case, the thier entire taxable income is only removed if it is less than the total value of the bonds. What money other than the amount of the bond is removed from the tax pool?

As you pointred out, the number of bonds is finite. Blocking the wealthy from investing all of their taxable income would free up more bonds to be purchased by the small-time investor.Or free up more bonds to be left unpurchased.

If they are intentionally issuing a product which they know is seriously flawed, then yes sir, they should be. Of course. But you seem unwilling to examine what "seriously" means.

As I said before, a manufacturer is not liable when a car travelling at 65 is involved in an accident and the occupant is killed.Why not? How expensive would a speed regulator be? I don't know for sure, but I imagine that regulating the speed of cars to under 40, let's say, would be pretty cheap. It would certainly save a lot more than a single life each year. Do you favor requiring such a device on cars?

Now, if that same stroller had a propensity to collapse and decapitate the baby inside, it should be banned.Ok, but what do you mean by propensity. Again, given the number of strollers in use now, I'd be surprised if at least 1 infant did not die this way sometime in the last or next decade. How many occurances are required for "propensity"?

I would not blame the airline if someone I loved died in a plane crash because of pilot error, but I would blame them if they knew that the plane was likely to fail but sold tickets anyway.You see, you cannot talk about these things without using terms like likely. No one can. The point is that if you are going to make laws using these terms, they need to have better definitions than this. What constitutes "likely" for an airplane crash?

An "incredibly small" problem does not kill or maim the consumer.This also is another misunderstanding on your part. Most technological devices are a very complex interaction of multiple complex systems. A very small failure in the insullation of the right wire running through the right conduit could result in the mid air explosion of a large airliner. A wire which fails after decades of use is a minor problem.

A single death when the company is knowledgeable of the defect and unwilling to fix it because it will affect their profits is unacceptable.Ok, so then you are willing to ban automobiles. Obviously many more than "single deaths" occur in them. Many of them due to failures of some sort in the car. So, by your standard we should ban cars until engineering solutions can make them safe.

Explain further: would people die because the design was faulty, or from causes like allergies? What, exactly, would kill them?Various things. The power source is different from electricity. It is dangerous in different ways. No alergies or infections are involved (that I know of). But people can die from excessive exposure to this power source. People can die from uncontrolled ignition of it as well. Obviously, precautions are taken to prevent this. However, accidents will happen no matter what we do.

I guess what I am talking about is the difference between the euphamism "perfectly safe" and the reality of life in the real world. Nothing is actually perfectly safe. But we use that phrase for many things; driving, electricity, even natural gas.

Obviously people should not be allowed to misrepresent the safety of things they sell to others. This includes an implied level of safety for most things. So, if a known problem has a reasonable solution, it should be actionable to avoid the solution. But you have to accept that not all problems fit what I mean by "known problem". And you have to accept that not all solutions fit what I mean by "reasonable solution". The only way to decide what problems and what solutions fit into these definitions is to analyze them.

Therefore we cannot penalize a company for analyzing the costs of a particular solution to a particular problem. We can certainly penalize them for doing it badly. We can certainly penalize them for refusing to make reasonable changes to prevent risks of reasonable likelyhood. But it seems reactionary and stupid to desire that all risks should be addressed regardless of the likelyhood and cost.

Lissa
01-16-2004, 01:48 AM
But this is not true. In this case, the thier entire taxable income is only removed if it is less than the total value of the bonds. What money other than the amount of the bond is removed from the tax pool?

Okay. Nowheresville offers $1 million in bonds to build a new park annex. Bob has $500,000 in taxable income after all of his various reductions. He buys $500,000 in bonds. Bob pays no taxes now. The city pays Bob interest on his "loan" to them, but recieves no tax revenue from him in return. The city loses money on Bob. (And so does the Fed.)

Bill, Jim, and Mike are Bob's golfing buddies. Bob tells them what he did, and they think it's a great idea. Between the three of them, they invest another $250,000, and remove themselves from the tax pool. Now, Nowhersville must pay interest to these people, increasing the size of the city's "debt," without getting any tax "income" from these people to help offset it.

Carl has a taxable income of $40,000. He buys $1,000 in bonds. He pays taxes on the other $39,000. Tim, Dave, Shawn and Steve also do the same, but still keep themselves in the tax pool, while helping the city out with its projects.

Of course. But you seem unwilling to examine what "seriously" means.

As I said before, I'm not talking about a pinched finger, I'm talking about burning to death. I would consider the latter to be "serious." If it can kill you, maim or disfigure you, cause the loss of a limb, digit, or eye, paralyse you, poison you, drown you, burn you, or cause you to become violently ill, I consider the flaw "serious."

Why not? How expensive would a speed regulator be? I don't know for sure, but I imagine that regulating the speed of cars to under 40, let's say, would be pretty cheap. It would certainly save a lot more than a single life each year. Do you favor requiring such a device on cars?

No, I don't. A company cannot be expected to account for the abuse of its product. If the consumer wants to use it in a dangerous way, (such as driving recklessly, or speeding) that's not the company's problem. They do not need to "babysit" the consumer to make sure that s/he uses it safely and responsibly: their obligation is to see that the product itself is safe.

Ok, but what do you mean by propensity. Again, given the number of strollers in use now, I'd be surprised if at least 1 infant did not die this way sometime in the last or next decade. How many occurances are required for "propensity"?

Once may be a freak accident. Twice may be a co-incidence, but after three reported incidents, a company should immediately begin researching the problem. If they discover it's because the parents forgot to put in a bolt while putting the stroller together, they are free of liability, but if the stroller is dangerous as correctly assembled, it should immediately be recalled.

Consumer Reports does product safety tests all the time. All they would have to do is test the item over and over and see how often it fails. One out of a million is a fluke, but one out of ten makes it pretty obvious the product is flawed.

You see, you cannot talk about these things without using terms like likely. No one can. The point is that if you are going to make laws using these terms, they need to have better definitions than this. What constitutes "likely" for an airplane crash?

An accident is "likely" when a company knows that a certain part on an airplane is not maintained as it should be. Airline safety has been studied in minute detail. They know the "failure rates" of certain parts, and how often they should be changed out, or maintained. Failure to do so creates a dangerous situation likely to cause harm or death to the passengers.

For example, it would be negligent, in my opinion, if a plane had a crack in its wing which should be repaired, but the company decides to squeeze in one more flight before taking it into the hangar. They know that a crack in the wing could cause structural failure because of the expansion and cooling of the metals during flight. They created a situation of aggravated risk.

This also is another misunderstanding on your part. Most technological devices are a very complex interaction of multiple complex systems. A very small failure in the insullation of the right wire running through the right conduit could result in the mid air explosion of a large airliner. A wire which fails after decades of use is a minor problem.

Perhaps you misunderstood me. A "minor" problem is one which causes my alarm clock to stop working. A "minor" problem is when my car's left tail light keeps shorting out. A "minor" problem is when I keep getting one of those error mesages on my computer. A "minor" problem does not kill anybody.

In your scenario, the frayed wire in the airplance was a "major" problem which resulted in catastrophic failure. The size of the part is not important. What is important is the results of its failure.

Ok, so then you are willing to ban automobiles. Obviously many more than "single deaths" occur in them. Many of them due to failures of some sort in the car. So, by your standard we should ban cars until engineering solutions can make them safe.

My brother-in-law is an engineer at one of the major car companies. When I was shopping for a car, I asked him about a certian one produced by his company. He told me the car had a propensity to wear out brake pads quickly, and that some customers had reported minor electrical problems. I bought the car.

Is my car "faulty"? Yes, in a way it is. He was right about the brakes. But it's not a flaw which will lead to my death. And the company is struggling to make it right. They're redesigning the breaking system for that model.

I don't think I would have bought it if he'd said, "Oh, and it has a tendancy to explode into flames when hit from behind."

Yes, I do think we should ban the production of vehicles with serious flaws that may cause serious injury or death when they are being used in the proper manner. If they know from tests that there's a substantial chance that a driver will be harmed or killed while operating it in normal driving conditions, then the vehicle has no place on the market.

Going back to the Pinto example, I think that as soon as the problem was discovered, Ford should have been forced to halt production, and to recall all of the cars that they had sold.

Various things. The power source is different from electricity. It is dangerous in different ways. No alergies or infections are involved (that I know of). But people can die from excessive exposure to this power source. People can die from uncontrolled ignition of it as well. Obviously, precautions are taken to prevent this. However, accidents will happen no matter what we do.

I guess what I am talking about is the difference between the euphamism "perfectly safe" and the reality of life in the real world. Nothing is actually perfectly safe. But we use that phrase for many things; driving, electricity, even natural gas.

Of course nothing is ever perfectly safe. I'm not "perfectly safe" sitting here in my office typing this. Structural failures, unforseen stresses, combined with human error can cause many an accident. Hell, aspirin kills a few people per year.

But you're still asking me to judge something blindly. I don't have enough information to make an informed decision, thus I refrain until I get more details.

Obviously people should not be allowed to misrepresent the safety of things they sell to others. This includes an implied level of safety for most things. So, if a known problem has a reasonable solution, it should be actionable to avoid the solution. But you have to accept that not all problems fit what I mean by "known problem". And you have to accept that not all solutions fit what I mean by "reasonable solution". The only way to decide what problems and what solutions fit into these definitions is to analyze them.

It seems pretty reasonable to me. You sold Product X. Turns out, it kills people. Announce the danger to the public. Look into it: is there a part or way it can be fixed by the consumer? No? Can't figure out what the problem is? Recall immediately. Can the company fix it? If so, repair and give back to consumer. If not, issue refund.

Your quarterly profits just went down the tubes, but perhaps you'll learn from this mistake and won't endanger the consumer next time.

Therefore we cannot penalize a company for analyzing the costs of a particular solution to a particular problem. We can certainly penalize them for doing it badly. We can certainly penalize them for refusing to make reasonable changes to prevent risks of reasonable likelyhood. But it seems reactionary and stupid to desire that all risks should be addressed regardless of the likelyhood and cost.

For the fourth or fifth time, I am not talking about any risk, but the risk of serious injury or death. If you know that your product can kill people, has killed people, and will kill more people, there should be no dilly-dallying over estimates and cost analysys. Get the product off the market, and fix the problem, or refund the purchase price.

Anything less is just wrong.

Grim_Beaker
01-16-2004, 01:49 AM
But this is not true. In this case, the thier entire taxable income is only removed if it is less than the total value of the bonds. What money other than the amount of the bond is removed from the tax pool?

I think Lissa believes that the money removed from the tax pool is the income tax that would have been paid by the wealthy had their investments been in a vehicle without some sort of tax protection. This may be true, depending on the amounts involved and the tax structure used but I don't think it's affects would really make that much of a difference. I'll use a hypothetical to illustrate.

Happy city issues bonds in the total amount of $50,000 at 5% with the expectation of paying the bondholders back after 1 year. Let's say that the income tax is progressive as follows:

$0 - $10,000 in income is taxed at 10%
$10,000 - $20,000 is taxed at 15%
$20,000 - $30,000 is taxed at 20%
etc.

In other words if a person made $15,000 annually the first $10,000 would be taxed at 10% (for a tax of $1,000) and the next $5,000 would be taxed at 15% (for another $750 for a total taxed amount of $1,750). Let's say that there are 6 people interested in the bond offering. 5 people who make $10,000 a year (and who also have $10,000 each saved) and 1 person who makes $20,000 a year (and who has $50,000 saved). Let's say that the 5 people who each make $10k a year decide to purchase the bonds with their savings. Each of these people would pay $1,000 in income tax due to their annual $10,000 income and $0 on the interest they received on the bonds ($500 each, or $2,500 total). The person making $20k a year invested his $50k at the same 5% but in a taxable investment. This person was taxed for $3,000 ($2,500 for his income of $20k and another $500 from the gains from his investment which boosted his annual income to a total of $22,500).

Total taxes received by the city: $8,000

Now lets imagine that the single wealthy person bought the entire bond offering. In this case each of the people making $10,000 a year invest their saved $10,000 in a taxable investment which returns 5% (like the wealthier individual did in the last example). In this case they each pay $1075 in taxes ($1,000 for the $10,000 in income they receive and $75 for the extra $500 interest they received from their taxable investment). The wealthier person pays $2,500 taxes, all of it from their annual income since none of the interest they received from the bonds (a total amount of $2,500 just like the last scenario) is tax free.

Total taxes received by the city: $7,875

The reason for the difference is that the city lost out on the funds that would have been generated by taxing the wealthier person at the higher rate. The only amount, then, that the city can be out more if a wealthier person buys the bonds in total, is the extra amount of money that would have been taxed at the higher rate. So, as I said before, while this is certainly some money ($125 in my example, or a loss of about 1.5% of their total tax revenue) it doesn't make that much of a difference. Of course my numbers here are hypotheticals but I think it would be unlikely for the real world figures to show that the actual amount lost was substantial (especially considering the rarity with which it seems to occur).

Grim_Beaker
01-16-2004, 02:01 AM
Okay. Nowheresville offers $1 million in bonds to build a new park annex. Bob has $500,000 in taxable income after all of his various reductions. He buys $500,000 in bonds. Bob pays no taxes now. The city pays Bob interest on his "loan" to them, but recieves no tax revenue from him in return. The city loses money on Bob. (And so does the Fed.)

Bill, Jim, and Mike are Bob's golfing buddies. Bob tells them what he did, and they think it's a great idea. Between the three of them, they invest another $250,000, and remove themselves from the tax pool. Now, Nowhersville must pay interest to these people, increasing the size of the city's "debt," without getting any tax "income" from these people to help offset it.

Carl has a taxable income of $40,000. He buys $1,000 in bonds. He pays taxes on the other $39,000. Tim, Dave, Shawn and Steve also do the same, but still keep themselves in the tax pool, while helping the city out with its projects.

I just want to point out that this doesn't invalidate my example. What is the difference between the $751,000 being invested in this example and a second hypothetical wherein 751 people, each making $40,000, invest $1,000? None from the city's standpoint except where I already noted that those with higher incomes will be paying taxes at a higher rate. The difference in the city's bottom line from a tax revenue standpoint will be based on the different taxation rate the wealtheir would have had to pay for part of their income (i.e. at 33% instead of at 28%, or 35% instead of at 33%, or whatever the real world numbers happen to be). If the city had a flat income tax rate then it would make no difference whatsoever from a tax revenue standpoint if all $1 million worth of the bonds were bought by a single wealthy individual or if they were bought by one million people each investing a dollar.

Grim_Beaker
01-16-2004, 02:26 AM
So far discussion regarding product design and manufacturer's responsibility has followed automobiles. I think this is a good example so I'll continue along in this vein. Lissa, you are correct when you state that there can be tremendous forces involved in some car crashes. So far the figures presented have been at the extremes ($11 vs. $5000) and so, I think, we might have overlooked an important piece of the puzzle, namely, that of the middle points in between. We could probably graph the expected fatalities of a given car design after holding constant the orientation of the vehicles involved in the crash while varying the speed of the vehicles. In other words, if we said that there were 100,000 cars of type X in use, and that these cars could be expected to be in Y crashes, then we could reasonably make a statement like:

There will probably be...
0 fatalities between 0 and 25 mph
1 fatality between 25 - 40 mph
3 - 5 fatalities between 40 - 50 mph
20 - 50 fatalities between 50 - 65 mph
etc.

In essence, the speed at which the vehicles collided can be shown to be a curve when represented graphically.


If you know that your product can kill people, has killed people, and will kill more people, there should be no dilly-dallying over estimates and cost analysys. Get the product off the market, and fix the problem, or refund the purchase price.


Therefore it's not as simple as "if you know your product can kill people". It's "how many people will die because of this design, at this speed, considering the likelihood and types of crashes today?". How fast are we saying that cars should be able to collide with 0 fatalities? If we're saying 65mph and 0 fatalities then I believe that's an unreasonable expectation. The engineering and materials requirements would price an automobile out of the hands of a large portion of American society starting with the poor. Would that be acceptable? If not, then at what speed should we expect collisions to produce 0 fatalities? 50 mph? 45 mph? Where do we draw the line (keeping in mind that the more stringent the requirements the fewer who can afford them, again, starting with the poor)?

It's all about trade offs. We have to weigh the benefits of varying degrees of safety and utility with the costs involved.

pervert
01-16-2004, 01:23 PM
I think Lissa believes that the money removed from the tax pool is the income tax that would have been paid by the wealthy had their investments been in a vehicle without some sort of tax protection.

1) Thank you for your analysis. I agree entirely that different tax structures will make a slight difference. Also, if I am not mistaken, Lissa pointed out a few other differences. Since smaller investors invest smaller amounts, they may have a higher propensity not report the investment. That is they may take standard deductions rather than itemize as Lissa suggested she does. This might make a difference as well. Although it could be offset by the savings usually had by taking standard deductions. I payed lower taxes for years by taking the standard deductions instead of itemizing. I wonder if I should claim that some poor people are hiding thier income this way? ;)

2) However, I still maintain that even if there is a small difference, this is far from the same as a tax dodge. That is, if this is a loop hole, it is one the government endorses and benifits from itself. It still seems unfair to criticize people for investing in cities. At least with the same terms used to criticize people who launder money through foriegn banks and such.

3) Thank you again for your numbers about product liability. That is all I am trying to say.

I have to say this.

For the fourth or fifth time, I am not talking about any risk, but the risk of serious injury or death. If you know that your product can kill people, has killed people, and will kill more people, there should be no dilly-dallying over estimates and cost analysys. Get the product off the market, and fix the problem, or refund the purchase price. I'm sorry, you do keep saying this, but it seems to me you are unwilling to examine the consequences of this view. I'm afraid that cars fit your definition of products which should be pulled from the market. They have killed people. They do kill people. And the will kill more people. Not only people who misues them, but also people who use them as expected. I would add (even though you do not include this criteria) that there are engineering fixes which could alleviate many (though not all) of these deaths.

However, you seem to also believe that cars should not be removed from the market. I am curious how you justify this position.

Finally, just in case anyone else is following the hypothetical I introduced a few posts back. I am talking about natural gas.






This may be true, depending on the amounts involved and the tax structure used but I don't think it's affects would really make that much of a difference. I'll use a hypothetical to illustrate.

Happy city issues bonds in the total amount of $50,000 at 5% with the expectation of paying the bondholders back after 1 year. Let's say that the income tax is progressive as follows:

$0 - $10,000 in income is taxed at 10%
$10,000 - $20,000 is taxed at 15%
$20,000 - $30,000 is taxed at 20%
etc.

In other words if a person made $15,000 annually the first $10,000 would be taxed at 10% (for a tax of $1,000) and the next $5,000 would be taxed at 15% (for another $750 for a total taxed amount of $1,750). Let's say that there are 6 people interested in the bond offering. 5 people who make $10,000 a year (and who also have $10,000 each saved) and 1 person who makes $20,000 a year (and who has $50,000 saved). Let's say that the 5 people who each make $10k a year decide to purchase the bonds with their savings. Each of these people would pay $1,000 in income tax due to their annual $10,000 income and $0 on the interest they received on the bonds ($500 each, or $2,500 total). The person making $20k a year invested his $50k at the same 5% but in a taxable investment. This person was taxed for $3,000 ($2,500 for his income of $20k and another $500 from the gains from his investment which boosted his annual income to a total of $22,500).

Total taxes received by the city: $8,000

Now lets imagine that the single wealthy person bought the entire bond offering. In this case each of the people making $10,000 a year invest their saved $10,000 in a taxable investment which returns 5% (like the wealthier individual did in the last example). In this case they each pay $1075 in taxes ($1,000 for the $10,000 in income they receive and $75 for the extra $500 interest they received from their taxable investment). The wealthier person pays $2,500 taxes, all of it from their annual income since none of the interest they received from the bonds (a total amount of $2,500 just like the last scenario) is tax free.

Total taxes received by the city: $7,875

The reason for the difference is that the city lost out on the funds that would have been generated by taxing the wealthier person at the higher rate. The only amount, then, that the city can be out more if a wealthier person buys the bonds in total, is the extra amount of money that would have been taxed at the higher rate. So, as I said before, while this is certainly some money ($125 in my example, or a loss of about 1.5% of their total tax revenue) it doesn't make that much of a difference. Of course my numbers here are hypotheticals but I think it would be unlikely for the real world figures to show that the actual amount lost was substantial (especially considering the rarity with which it seems to occur).[/QUOTE]

pervert
01-16-2004, 01:30 PM
AAAAAAAH! Darn rodents! Never meant to hit Submit before Preview!



Oh. Wait. No, that's not true. I love the hamsters. Really they are great. Sorry about including the rest of Grim_Beaker's post at the end of mine. I forgot to remove it before submitting my post. :smack:

jadagul
01-16-2004, 05:44 PM
Isn't product liability is affected by who knows what? For instance, if I'm a car manufacturer and I know my cars spontaneously combust (5% a year) but tell people they're completely safe, I'm almost certainly guilty, of fraud if nothing else. I've deliberately sold a product under false pretences. Similarly, if I tell people the car can run safely at 100 mph when it can only run safely at 80 mph, I'm liable even though running a car at 100 mph isn't really a 'normal' use, because I lied about my product.

On the other hand, if the buyer knows what's going on, where's the government's place in anything? We've mentioned that making anything safer makes it more expensive; maybe I as the consumer am willing to accept the risk in exchange for the reduced price (my family could get a car much safer than the one we have now, but it would be less spacious and more expensive, and it would have much worse gas milage. For that matter, we could armor-plate the car, but if we required all cars to be plated like tanks no one would be aple to afford them). If I buy a car in full knowledge that it tends to combust when hit from the rear, it's my own fault.

The gray area exists when the manufacturer/seller didn't know the risk. For instance, if I sell a car with a tendency to combust, but don't know it, am I liable? If there was some reason I should have known (I refused to run tests because I didn't want to know) or made claims that it wouldn't (I ran flawed tests that indicated it wouldn't, and promised it wouldn't), then I probably am liable. But if I did my best to determine safety and couldn't find a flaw, I, at least, don't think I should be liable for what I've already sold. On the other hand, I have to tell people before I sell any more.

Of course, this doesn't mean I won't recall the product anyway--this is often just good business. I want customers to trust me, after all.

As a final note on safety: we can never be absolutely safe. Each of us will suffer some risk, depending on what we do; the tradeoff between risk and convenience is something each person has to decide for himself. We should help him be informed, but if he makes a knowledgable decision to accept a greater risk, there's no reason we should force him to do otherwise.