Is there anything wrong with "class warfare"?

[mmmbeer]

[quote=“septimus, post:239, topic:634349”]

What is NOT class warfare is to ask why billionaires pay a lower tax rate than their secretaries. Suppose a secretary pays 20% (including payroll taxes) on $75,000 and takes home $60,000. Is it really “warfare” to ask that the vulture capitalist who earns $75 million pay 20% and take home only $60 million? I’d rather take home $60 million than be guillotined; YMMV. If the gibberish here about class warfare continues, I’m afraid I’ll start a thread asking SDMB math experts to confirm whether $60 million is larger or smaller than $60,000.
QUOTE]

This is precisecly what I propose and the progressives attack saying that the $75 million should be taxed at 40%, which IS class warfare. I say that because we don’t have classes here and if the term is to have any meaning in this country, it must mean high income earners vs low income earners or their advocates. I invited dissenters earlier to give a different definition and they have declined thus far.

So, to say that class warfare is only saying something isn’t quite correct. You can say whatever you want. That doesn’t hurt me. To put it into action does.

To use a phrase taken from my comrades to the left, From each according to his means…75,000 income gives 15,000 and 75,000,000 gives 15,000,000. See, each gives according to his means? 20%
Except for teenage lemonade stand billionaires, of course. We can soak them for 80%. I can compromise!

I push for 10%, but that is to accomplish a 2nd purpose explained earlier.

[septimus]

Recall that Romney paid more than he was obligated to just to get his tax up to 13%. And that’s just on AGI, and doesn’t include appreciation in his Sep-IRA fund which has magically accumulated $20 to $100 million despite the small cap on contributions.

13% is an interesting tax rate – it’s about what the working class pays just for their federal payroll taxes even with the temporary 2% stimulus cut, and even when their income tax is zero.

@mmmbeer

… the progressives attack saying that the $75 million should be taxed at 40%, which IS class warfare.

If you think the Marxists with pitchforks are going to get Romney’s tax rate anywhere near 40%, I’ll ask what you’ve been smoking! Would 25% be “class warfare”? How about 28%?

What is class warfare is to call the push for increasing taxes on the rich “class warfare” while insisting that the working class, who already pay a higher rate than Romney when payroll (and employer-provided) taxes are included, should pay yet even more so they have “skin in the game.”

@mmmbeer

I push for 10%, but that is to accomplish a 2nd purpose explained earlier.

Right now, Romney and lowest-wage workers pay about the same, about 13% each. Do I understand that you want to drop Romney’s rate to 10% while increasing the rate on lowest-wage workers (payroll tax plus income tax) to 23% ?

[mmmbeer]

@septimus

Recall that Romney paid more than he was obligated to just to get his tax up to 13%. And that’s just on AGI, and doesn’t include appreciation in his Sep-IRA fund which has magically accumulated $20 to $100 million despite the small cap on contributions.

13% is an interesting tax rate – it’s about what the working class pays just for their federal payroll taxes even with the temporary 2% stimulus cut, and even when their income tax is zero.

If you think the Marxists with pitchforks are going to get Romney’s tax rate anywhere near 40%, I’ll ask what you’ve been smoking! Would 25% be “class warfare”? How about 28%?

What is class warfare is to call the push for increasing taxes on the rich “class warfare” while insisting that the working class, who already pay a higher rate than Romney when payroll (and employer-provided) taxes are included, should pay yet even more so they have “skin in the game.”

Right now, Romney and lowest-wage workers pay about the same, about 13% each. Do I understand that you want to drop Romney’s rate to 10% while increasing the rate on lowest-wage workers (payroll tax plus income tax) to 23% ?

To use a phrase taken from my comrades to the left, From each according to his means…75,000 income gives 15,000 and 75,000,000 gives 15,000,000. See, each gives according to his means? 20%

See where it says EACH according to his mean? 20%…If you were get out your dictionary, you would find that EACH means everybody!
20% for everyone, where the hell do you get that I want to drop Romney’s rate to 10% and raise the lowest-wage workers to 23%
20% for everyone means if Romney is someone, his rate would be 20% and if the lowest-wage worker is someone, guess what his rate would be? 20% Is that clear enough for you?

My proposal for 10% was guess what? 10% for everyone. I was commenting back to the person who suggested 20% for WHO???, understand yet??, yeah, EVERYONE.
Do I have to spell out again that means for Romney AND the lowest-wage workers? Jesus, Joseph, and Mary.

[septimus]

@mmmbeer

My proposal for 10% was guess what? 10% for everyone.

Sorry that I wasn’t clear.

My question for you was: Does that 10% include federal payroll taxes?

[Sam_Stone]

@septimus

To the right-winger who will show up soon, twist these words, and use them to demonstrate that septimus is waging class warfare: Please take a deep breath and apply common sense instead.

When the Mormon Temple needs a new roof, do they ask Milton Ramner for help, or Alice Q. Crackhead? When help is needed for earthquake damage in Bangladesh, is Uruguay expected to contribute as much aid as the U.S.A.? Google by yourself if you need a cite, start with “easier camel eye needle” if you wish.

No, I’ll just respond with math. You say you want to tax the rich, because ‘that’s where the money is’. But it’s really not, because the rich make up a relatively small part of the population.

For example, the difference between Obama’s request to eliminate the tax cuts on the ‘rich’ and the Republican’s request to maintain the tax cuts is about 80 billion dollars per year. The deficit is currently trending towards something like 1.2 trillion dollars. That means if Obama gets his way, the deficit will be reduced by an additional 6.7%, and you’ll still have a deficit of 1.12 trillion dollars.
Then what are you going to do?

That’s assuming ‘static scoring’ - that the tax increases will have no effect on growth. It also assumes that the rich will not engage in extra tax-avoidance activity. Neither of those assumptions are valid. Just ask Britain, which recently instituted a higher tax on the rich and saw their revenues decrease. Or ask Bill Clinton, whose ‘luxury tax’ was supposed to increase revenues but had to be repealed because it was costing the government money.

I’m not saying that revenue will go down if you increase taxes on the rich, but it won’t go up by as much as a straight accounting equation would suggest. So maybe the government gets an additional $50 billion per year. This will leave the fiscal situation essentially unchanged. Then what are you going to do? Demand more taxes from the rich? You could tax everything they make and you still couldn’t eliminate the deficit.

So from that standpoint, this focus on taxing the rich is a distraction. The real problem, as all serious analysts understand, is that the U.S. has been making entitlement promises to the middle class that it simply cannot keep. Health costs are exploding, federal and state pensions are grossly under-funded, and as the baby boomers retire all of these structural problems are going to boil over.

Bringing this back around to the title of the thread, that’s one of the big problems with class warfare: It deflects attention away from the real issues by scapegoating a small percentage of the population and putting the blame on them. Countries like France and Britain already have higher taxes on their rich people, and it hasn’t stopped them from facing a fiscal meltdown as the entitlement state runs into the hard reality of demographics.

If you want to give the middle class all these entitlements, you have to raise taxes on the middle class. But politicians never want to do that, because the middle class is where the bulk of the voters are. So they promise them benefits AND promise that they won’t have to pay for them. The Republicans do it with hand waving about the Laffer Curve and economic growth, and the Democrats do it by blaming the rich. Both parties are living in a fantasy land.

[Left_Hand_of_Dorkness]

@Sam_Stone

For example, the difference between Obama’s request to eliminate the tax cuts on the ‘rich’ and the Republican’s request to maintain the tax cuts is about 80 billion dollars per year.

A billion here, a billion there, and pretty soon you’re talking real money.
…

Bringing this back around to the title of the thread, that’s one of the big problems with class warfare: It deflects attention away from the real issues by scapegoating a small percentage of the population and putting the blame on them.

Close, but not quite. The big problem with “class warfare”–and note that to find the big problem, we gotta put the term in quotes–is that it deflects attention away from the real issues by pretending that reasonable discussions about tax policy are actually scapegoating a small percentage of the population and putting the blame on them.

Nobody in mainstream politics is scapegoating a small percentage of the population. Even the main person engaging in scapegoating–Romney–is scapegoating 47% of the population, hardly a small percentage. But folks who don’t want to discuss taxes reasonably instead slap the “class warfare” label on anyone proposing raising marginal rates, trying to end the conversation. It’s an obnoxious and dishonest distraction.

[mmmbeer]

@septimus

Recall that Romney paid more than he was obligated to just to get his tax up to 13%. And that’s just on AGI, and doesn’t include appreciation in his Sep-IRA fund which has magically accumulated $20 to $100 million despite the small cap on contributions.

13% is an interesting tax rate – it’s about what the working class pays just for their federal payroll taxes even with the temporary 2% stimulus cut, and even when their income tax is zero.

If you think the Marxists with pitchforks are going to get Romney’s tax rate anywhere near 40%, I’ll ask what you’ve been smoking! Would 25% be “class warfare”? How about 28%?

What is class warfare is to call the push for increasing taxes on the rich “class warfare” while insisting that the working class, who already pay a higher rate than Romney when payroll (and employer-provided) taxes are included, should pay yet even more so they have “skin in the game.”

Right now, Romney and lowest-wage workers pay about the same, about 13% each. Do I understand that you want to drop Romney’s rate to 10% while increasing the rate on lowest-wage workers (payroll tax plus income tax) to 23% ?

Really? You want to weasel around to say that all that means…

My question for you was: Does that 10% include federal payroll taxes?

Are you wanting me to just push the “I believe” button and accept that your first post means the second post? Wow!

But, to answer the question:
Aren’t we talking about Federal Income taxes? Do you mean something other than that?
So, to go ahead and answer, I, and I thought, everyone else, am talking about Federal Income taxes. So, 10% doesn’t include it, 10% is it, and if you’re asking about something else, I haven’t commented on that. Like it doesn’t include estate tax, or taxes on yachts, or whatever.

[septimus]

@mmmbeer

Jesus, Joseph, and Mary

@mmmbeer

@Septimus

… Do I understand that you want to drop Romney’s rate to 10% while increasing the rate on lowest-wage workers (payroll tax plus income tax) to 23% ?

Really? You want to weasel around to say that all that means…

Are you wanting me to just push the “I believe” button and accept that your first post means the second post? Wow!

But, to answer the question:
Aren’t we talking about Federal Income taxes? Do you mean something other than that?
So, to go ahead and answer, I, and I thought, everyone else, am talking about Federal Income taxes. So, 10% doesn’t include it, 10% is it, and if you’re asking about something else, I haven’t commented on that. Like it doesn’t include estate tax, or taxes on yachts, or whatever.

My only answer is to repeat my words (in a larger font ) from the original post which you responded to and which you even quoted above

Do I understand that you want to drop Romney’s rate to 10% while increasing the rate on lowest-wage workers [SIZE=“5”](payroll tax plus income tax) to 23% ?[/SIZE]

Does this help?

[septimus]

And please, mmmbeer (and any of his would-be defenders) do be aware that the question on the table is not whether payroll taxes should be counted as taxes. The question on the table is:

When I write

@Septimus

Right now, Romney and lowest-wage workers pay about the same, about 13% each. Do I understand that you want to drop Romney’s rate to 10% while increasing the rate on lowest-wage workers (payroll tax plus income tax) to 23% ?

Is it rational, or even sober, to respond with

@mmmbeer

See where it says EACH according to his mean? 20%…If you were get out your dictionary, you would find that EACH means everybody!
20% for everyone, where the hell do you get that I want to drop Romney’s rate to 10% and raise the lowest-wage workers to 23%
20% for everyone means if Romney is someone, his rate would be 20% and if the lowest-wage worker is someone, guess what his rate would be? 20% Is that clear enough for you?

My proposal for 10% was guess what? 10% for everyone. I was commenting back to the person who suggested 20% for WHO???, understand yet??, yeah, EVERYONE.
Do I have to spell out again that means for Romney AND the lowest-wage workers? Jesus, Joseph, and Mary.

[mmmbeer]

@septimus

And please, mmmbeer (and any of his would-be defenders) do be aware that the question on the table is not whether payroll taxes should be counted as taxes. The question on the table is:

When I write

Is it rational, or even sober, to respond with

Originally Posted by Septimus
Right now, Romney and lowest-wage workers pay about the same, about 13% each. Do I understand that you want to drop Romney’s rate to 10% while increasing the rate on lowest-wage workers (payroll tax plus income tax) to 23% ?

What kind of math takes your starting point of each pays about 13 %, then I suggest that everyone’s tax rate should be 10%, so you make (this is kind of funny to me) only Romney’s rate 10% and to everyone else’s 13%, you add 10% to get 23%? Where do they teach math like this? I know word problems are tricky for some people, but this is, hell, I don’t know what this is.
Maybe I don’t know what you mean. When I look at my check, I don’t have anything call payroll taxes. I have Federal Income taxes, which is what I’m talking about, that I explained earlier. So, how to make it clearer?
Take the whole tax code and all the forms and schedules and exemptions and exceptions and all the other stuff and throw it in the trash. Write down 10%. That is the Federal Income Tax code. For everyone. No one is proposing writing a seperate tax code for Mitt Romney, although one of us continues to bring him up. Done! Understand? If you have other tax liabilities, I am not, as I said earlier, talking about them. Only what the IRS collects.

As an aside, I have seen that phenomena in action. Someone doesn’t understand, so the other person shouts. Then suddenly the first person still doesn’t understand.

[septimus]

@mmmbeer

What kind of math takes your starting point of each pays about 13 %, then I suggest that everyone’s tax rate should be 10%, so you make (this is kind of funny to me) only Romney’s rate 10% and to everyone else’s 13%, you add 10% to get 23%? Where do they teach math like this? I know word problems are tricky for some people, but this is, hell, I don’t know what this is.

If you focused more on understanding, and less on finding humor, you might avoid being tricked. I specifically mention “Payroll tax.” Do you use Wikipedia?

Payroll tax

Federal social insurance taxes are imposed equally on employers and employees, consisting of a tax of 6.2% of wages up to an annual wage maximum ($110,100 in 2012) for Social Security and a tax of 1.45% of all wages for Medicare. For the years 2011 and 2012, the employee’s contribution has been temporarily reduced to 4.2%, while the employer’s portion remained at 6.2%.

When employer contribution is included (as it should be), the tax is 13.85% (or 11.85% with the “temporary reduction”). Assuming Romney pays the maximum payroll tax (13.85% of $110,100), it would still amount to less than 0.1% on his total income. So, given a 10% flat income tax, Romney would pay 10.1% total tax (income plus payroll), while his secretary would pay 23.85%.

You may disapprove of this accounting. However in your posts to date, you didn’t express disapproval, just incomprehension.

In future I hope you reread posts that seem to make no sense, rather than delighting in what seems “funny” or writing “Jesus, Joseph, and Mary.” I do accept part of the responsibility for failing to write “(including payroll tax)” in a large font from the get-go.

@mmmbeer

Maybe I don’t know what you mean.

Evidently.

[mmmbeer]

@septimus

If you focused more on understanding, and less on finding humor, you might avoid being tricked. I specifically mention “Payroll tax.” Do you use Wikipedia?

Payroll tax - Wikipedia

When employer contribution is included (as it should be), the tax is 13.85% (or 11.85% with the “temporary reduction”). Assuming Romney pays the maximum payroll tax (13.85% of $110,100), it would still amount to less than 0.1% on his total income. So, given a 10% flat income tax, Romney would pay 10.1% total tax (income plus payroll), while his secretary would pay 23.85%.

You may disapprove of this accounting. However in your posts to date, you didn’t express disapproval, just incomprehension.

In future I hope you reread posts that seem to make no sense, rather than delighting in what seems “funny” or writing “Jesus, Joseph, and Mary.” I do accept part of the responsibility for failing to write “(including payroll tax)” in a large font from the get-go.

Evidently.

I have said at least 3 times that I’m talking about the Federal Income tax rate. Allow me to provide you a link:

Income tax in the United States

Does that include social security?
Does that include Medcare?
Does that include Medicaid?
Does that include I’m an 22 year old tax? or I’m a retired hooker tax?
NO!

I don’t see how you could not understand what I mean when I say the Federal Income tax.
I don’t see how you could not understand when it is your example that we are talking about…

By Septimus

What is NOT class warfare is to ask why billionaires pay a lower tax rate than their secretaries. Suppose a secretary pays 20% (including payroll taxes) on $75,000 and takes home $60,000. Is it really “warfare” to ask that the vulture capitalist who earns $75 million pay 20% and take home only $60 million? I’d rather take home $60 million than be guillotined; YMMV. If the gibberish here about class warfare continues, I’m afraid I’ll start a thread asking SDMB math experts to confirm whether $60 million is larger or smaller than $60,000.

So, I’ll let you answer your own question, Are you talking about payroll taxes?

[septimus]

Hello,mmmbeer. To answer your latest question:

Everyone knew all along that you were referring to income tax.

Everyone except you knew all along that I was referring to (income taxes plus payroll taxes).

Whether it is appropriate or fair to include payroll taxes might be an interesting topic for debate, but I’ll need a break before I engage you in any further “debate.” I will mention that the remark by Warren Buffett about his and his secretary’s relative tax rates, which provoked the whole “class warfare” debate, did include payroll taxes.

The “conversation” you and I had here may make an interesting case study of something. I’ve started a thread in another forum to discuss it.

[Ruken]

Sam Stone, pardon if you’ve brought this up already (I’m working through this thread backwards) but does Canada or the provinces you are familiar with have any sort of payroll taxes similar to the US? It seems that adds some extra complications and the occasional situation where someone wealthy has a surprisingly low total federal tax rate.

[mmmbeer]

So, cutting all the sarcasm and BS out and being serious…

It seems that this is the confusing part…

By Septimus

Right now, Romney and lowest-wage workers pay about the same, about 13% each. Do I understand that you want to drop Romney’s rate to 10% while increasing the rate on lowest-wage workers (payroll tax plus income tax) to 23% ?

Where does this “about 13% each” comes from. What makes up this 13% for each side?

Because you go on to ask If I am for dropping Romney’s rate to 10%, meaning that all he pays now, is 13% income tax, and raising other’s people’s rate to 23%, meaning I’m adding a new 10% income tax to the other people that they are not paying now.
This means you imply those other taxes are 13% for the other people and they are not paying any income taxes now.

Is this what you mean is the situation now? And that you think I am for adding 10% to people who don’t make enough to pay income taxes now, and subtracting 3% from Romney?

I am not going after the poor. I have stated I am only talking about the Federal Income tax and that all American’s participation in funding the treasury should be an equal percentage regardless of the numbers. It was suggested that the first $20,000 not be taxed for everyone, then 20% for everyone on all income over $20,000 regardless of source.

In addition, if you want to talk about the unfairness of the application of Social Programs, I would be happy to do so.
To start, there should be no cap on who pays into it, it should be a very small percentage taken (.5-1 maybe) and only given to make a person’s retirement income be, oh…20,000/year. This will serve to separate charity expenses and running of the government expenses. If you have more than that in retirement income, you don’t need assistance. If you have worked until you are 60-65 and all you could muster up for old age is 15,000/year, we will help with another 5,000 to see that you don’t live under an overpass and eat dog food.
But, I think that should be a separate thread.

[mmmbeer]

Apologies

It seems it was here in post 239

Suppose a secretary pays 20% (including payroll taxes) on $75,000 and takes home $60,000. Is it really “warfare” to ask that the vulture capitalist who earns $75 million pay 20% and take home only $60 million?

In doing the math, I missed the part in parentheses specifying they are paying different taxes. Virtually everyone so far has been on the “tax income from all sources” bandwagon, so they would now be paying the same rate.
All the same, I missed your payroll taxes part and had my mind on income taxes, so my bad.
To be fair, you gotta admit that I said many times I was only talking income taxes.

[septimus]

@mmmbeer

To be fair, you gotta admit that I said many times I was only talking income taxes.

I knew you were writing about income taxes. I kept writing “payroll taxes” in larger and larger fonts so you would know what I was writing about. But, as you suggested, perhaps it was a case of my yelling so loud, you couldn’t hear me.

You’re not the only one to avoid the payroll-tax connection. Warren Buffett’s famous claim was

@Warren Buffett

Last year my federal tax bill — the income tax I paid, as well as payroll taxes paid by me and on my behalf – … was only 17.4 percent of my taxable income — and that’s actually a lower percentage than was paid by any of the other 20 people in our office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent. [septimus added underlining]

Yet a Doper in a thread some months ago, along with a right-wing economist he quoted, both made the same elision you did, ignoring the phrase “as well as payroll taxes paid by me and on my behalf.”

Whether it is fair or appropriate to include payroll taxes may be debatable. I’m not going to debate it now though; this thread has wearied me; the only reason I respond at all is that mmmbeer apologized. (Thank you, mmmbeer ! )

Since the topic is “class warfare,” however, let me repeat that the total rejection of any idea that payroll taxes should be included is a far worse Class Warfare than anything the centrists have yet done.

@Warren Buffett

there are figures that show that the people in the $10-20 thousand bracket are paying as much in the combination of payroll and income taxes as the ultra rich.

[emacknight]

@Ruken

Sam Stone, pardon if you’ve brought this up already (I’m working through this thread backwards) but does Canada or the provinces you are familiar with have any sort of payroll taxes similar to the US? It seems that adds some extra complications and the occasional situation where someone wealthy has a surprisingly low total federal tax rate.

Canadian businesses pay a lot of payroll taxes, typically done at the provincial level. The two big ones are Employment Insurance premiums, and Canada Pension Plan premiums (like Social Security). Some provinces also have an additional health insurance type payroll tax and there are premiums for Workers Compensation (in the event of injury).

The problem with calling payroll deductions “taxes” is that the individual ultimately gets it back as an entitlement. Social Security and Medicare equate more to a forced savings plan than a tax. It’s as disingenuous as calling a person’s 401k a tax, or the employer matching part a tax.

[Sam_Stone]

@Ruken

Sam Stone, pardon if you’ve brought this up already (I’m working through this thread backwards) but does Canada or the provinces you are familiar with have any sort of payroll taxes similar to the US? It seems that adds some extra complications and the occasional situation where someone wealthy has a surprisingly low total federal tax rate.

To add to what emacknight said:

In Canada, workers pay into the Canada Pension Plan. We pay 4.95% of our salary, up to a maximum salary of $50,100 (as of 2012), and the employer also matches it. If you’re self-employed, you pay both sides.

So, if a worker makes the maximum income of $50,100, , he or she will pay $2,306.70 in CPP, and the employer also pays that amount. If you make $100,000, you still only pay $2,306.70. But that’s because the benefits you get at retirement are based on your income, but the government will only pay out in proportion to that maximum income. So if you want to stay relatively close to the lifestyle you have on a $100,000 income, you’re going to have to save for your own retirement.

We also pay 1.78% of our income (up to the same maximum) for unemployment insurance, and in this case the employer has to pay 1.4 times that amount, or about 2.5% of your income.

So counting both the employer’s contribution and yours, ou pay 9.9% of your income in CPP, and 4.272% in EI, up to the maximum.

This is just federal taxes. The provinces add on their own payroll taxes, which vary from province to province. Quebec has opted out of CPP, and maintains a completely separate retirement system.

So really, for anyone making more than the maximum, the government is collecting $4613.40 per year for your retirement, and you’re paying $2,140 per year in unemployment insurance.

Canada also dynamically changes the system to account for demographics and income changes.

I second what emacknight said about the difference between a payroll tax and an income tax. I find it very disingenuous when liberals try to claim an equivalence between income taxes and payroll taxes. The payroll tax is supposed to be your money, held on your behalf by the government. Income tax, on the other hand, is money the government collects to pay for the general operation of government.

Here’s one reason why it’s different: ‘Good government’ conservatives talk about the destabilizing effect of having a near-majority of the population who pay no income tax, because it means that they know if they vote for new government services, they won’t be paying for them. That sets up incentives for people to constantly vote for increasingly expansive government. The payroll tax doesn’t count here, because the amount you pay is not set by how much the government spends - the amount you pay is determined by actuaries to fund the retirement system.

[Ruken]

Thanks for the replies. I disagree with you both…mostly, but it’s an interesting topic that I think would make for good discussion. This thread seems to have died down, and it’s a bit of a hijack. I’ll see if I can slap an OP together when I’m not trying to type with these fat fingers on a phone.