What they are saying is the top 40% are paying for more than they receive in benefits and the bottom 60% receive more in benefits than they pay in taxes. Government spends 25% of its budget on welfare if you don’t include SS and Medicare as welfare. We do not take as an article of faith that government spends mostly on welfare.
Cite?
I get around 7% based on Mother Jones assertion that it’s $235 billion, most of which is SNAP (Mother Jones claims it’s 5% in the article).
Wonder how much it was in the Founding Fathers day…
The flaw is that it is extremely…debatable…that someone paid 20 million a year for “CEO services” or whatever is actually not just feeding off the value added by the lower workers in whichever corporate hierarchy you are talking about.
And by “debatable”, I mean you’d have to be both stupid and crazy to think that the system is fair or paying people proportional to their actual worth.
So that’s kind of the problem. Yeah, in terms of direct individual benefits, what you are saying is right. In terms of actual financial benefits, the people on the top receive more. A person who has 5 million in assets get a lot more benefit from the police and military because they have a lot more to lose. They get a lot more benefit from the roads because their businesses depend on them. And same for all the rest of the infrastructure. They get enormous benefit from public colleges, because without educated workers they can underpay, their business would collapse. And so on and so forth.
Garbage.
Jefferson even met Smith, during the nine years it took to complete WoN.
That “garbage” happens to be widely-known fact. Or are you suggesting that the widely-known publishing date of Wealth of Nations is, in fact, not correct?
Jefferson was not in Europe during the writing of Wealth of Nations, nor Smith in America. Jefferson made one trip to London in his life, but I can’t find any reference to him meeting Smith there. Benjamin Franklin met Smith at some point, but I see no evidence that this affected his economic thinking particularly, and despite some favorable references (which were far more favorable to Hume), I don’t see that the Founders especially followed Smithian economics. On the contrary, they began implementing a semi-protectionist regime themselves.
Finally, I said nothing whatsoever about the Scottish Enlightenment playing no role in building the intellectual foundations of the American Revolution. I don’t see a terribly strong case being made for it, as I see non-European factors as far more influential, but a case can be made. Your cite, however, plays a weak argument for more than its worth and is only partly related to Smith or economics at all.
No, they aren’t. They are only analyzing a small subset of benefits.
And that 25% figure is total nonsense.
There’s a difference between an estate and a corporation. They admired large estates. The owner of an estate could suffer losses from the risks he chose to take. With corporations, the owners are protected from personal loss. They regarded that as a moral hazard. As in: a man may be honorable, a corporation cannot be.
Regarding taxes, most taxes at the time were tariffs or commodity taxes. Whether a specific tariff/tax was aimed at the wealthy or not requires analysis, it’s a little more indirect than setting tiered income tax rates. I’m going to assume that they mostly went for taxes that were easy to collect.
Since you brought it up, I’m trying to think what sort of government services were available, back then. There was the patent office and the post office. Deeds were recorded, contracts and wills may have been, too, but probably at the county level. Some cities had libraries. I’m unsure whether there were fire or police departments, but those would have been municipal, too, rather than federal. Were there widow’s benefits from the military? As far as I know, the federal government didn’t even improve roads until the 1920’s.
But taxes and benefits don’t have anything to do with being against corporations. They weren’t against wealthy estates, they just had a healthy distrust of what men were likely to get up to behind the corporate veil.
You are correct. Also in the English tradition, tariffs and so on were generally a lot more acceptable than wealth taxes. Income taxes were technically possible, but a massive pain due to the difficulty in calculating farm income year-to-year.
There were a lot of services, but most of these were not federal and/or not necessarily very evenly distributed. Also, there was a lot of road improvement going back a century before your date of 1920, though as you can imagine the people who didn’t benefit were spitting mad over spending money on it. It was a major cause of the split of the Democrat-Republicans into the Democrats and Whigs.
dEFINITELY
Well, this is embarrassing. Anyway, replace the last messy line with:
“Definitely true, and also corporations were viewed as permanent groups whose political goals are more or less exactly what we think of today as “special interests” complete with lobbying the government for favors. Many of the Founders (not all) looked at institutions like the Bank of England with suspicion, and note that mismanagement and financial chicanery at the East India Company were one of the prime causes of the Revolution. This is often forgotten today - but it did not go unnoticed at the time. In fact, that’s why there were cargoes of tea in Boston Harbor, waiting to be sweetened with saltwater.”
Here is a breakdown of all the major 13 federal anti-poverty programs plus Medicaid. They total $732 billion. There are also another 67 anti-poverty programs that spend another 10 billion but itemizing those would be tedious. States also spend 172 billion on Medicaid and a portion of that is borne by the federal government because of the destructibility of state income taxes.
That is an odd way of computing value. The way most people compute value is to look at the marginal cost. For instance a pound of gold is worth more than a pound of water even though you would die of thirst without water and would survive fine without gold. Poor people depend totally on police for security but rich people can hire their own security guards. Thus the marginal benefit of the government is greater for poor people.
Plus poor people tend to live in higher-crime neighborhoods, and thus benefit disproportionately from the police presence. And they don’t pay taxes, by and large.
Regards,
Shodan
It still doesn’t add up to 25%.
BTW, if you include Earned income tax credit and child tax credit (which might be viewed as rebates on the SocSec tax) as “government spending”, then do new tax cuts for the rich also count as “government spending”?
I thought that had already been explained to you. Taking money in is different from putting money out.
Regards,
Shodan
Yes these out-of-context and exceedingly vague quotes from a time when certain words and concepts were interpreted differently from their current interpretation has made me forget that exactly 0 (zip/zilch/nada) attempts were made by these men to implement anything approaching an egalitarian economic regime despite being the most powerful men of their time.
My mind has also been vanquished of the open cronyism of Alexander Hamilton’s banker-enriching schemes, and I suddenly have a hankering to see Lin-Manuel Ferrara rapping about his humble beginnings.
Mathematically speaking, excluding a particular person from $1 in tax is precisely the same as sending them $1 in benefits. And, really, saying the former isn’t welfare but the latter is is a pointless semantic distinction.
Your entire net income is excluded from taxation. Does that mean your entire net income is a government benefit?
The level of benefits can, and often does, exceed the level of taxation. Tax relief does not and cannot exceed the level of taxation. These are more than semantic distinctions.
No, it isn’t.
And no, it isn’t. As WillFarnaby points out, this is based on the idea that the government owns everything you make, and anything they allow you to keep is a subsidy. This is not the case.
It is very far from a pointless semantic distinction. It is the correction of a fundamental mistake.
Regards,
Shodan
Shodan, frankly, just about everything you say on this message board is either trolling or just plain idiotic. I frankly think you should be banned, you never debate in good faith.
In any case, the flaw in your argument is that if 2 individuals each make, say, $1000, and the government gives one individual some arbitrary tax break making their taxes below the book rate, but doesn’t give that to the other individual, damn straight there is no accounting difference between the government giving the favored individual a tax break and just writing them a check.
If the government is in debt and they give you a tax break below the rate that is your fair contribution to balance the budget, the government is paying you. You’re getting more services from the government than you are paying for.
Contrary to popular belief, in total taxes (fica AND income taxes AND state taxes AND state and federal fees), the rich pay much less as a percentage of their incomes. So yes, the rich are subsidized.