Is "wealth transfer" in the US mostly via a flat tax already?

Based on my limited understanding of US taxation, isn’t the vast majority of “wealth transfer”, that is, Social Security and Medicaid, already funded by a flat (or in social security’s case regressive) tax?

Those 2 are 42% of the federal budget. Of the remainder, another 20% goes to defense, which isn’t really a wealth redistribution scheme, and neither is interest, which is another 9%. So basically, the stuff at the tail end of the 29% left over, excluding your national parks and EPA and interstate and NASA and all that, which can be construed as “wealth redistribution”, is what’s forcing jimpatro into exile? What percentage of the budget do these make up?

I don’t have a cite handy (on the blackberry), but I think the cost of SS and Medicare/Medicaid far exceed the intake on the payroll taxes.

I’m not sure I understand the question, heck I’m not sure I understand “wealth redistribution” the way it’s been kicked around lately, but the way I am looking at it, once national parks and EPA and interstate and NASA and all that are paid for, we’re in the hole. Here is a breakdown of money taken in and spent by the government for 2007.

For at least SS, that’s incorrect. We are still running a surplus. Around 2017 we start spending more than we are taking in. So we start using up the surplus we’ve been generating for the last 20 years. Around 2042 the last of the surplus is used up and we are taking in something like 88 cents for each dollar promised.

Here’s the key 2006 graph. The latest report is more optimistic, but I can’t find the link. … no, here it is, scroll to figure 3.
Medicare/Medicaid is a whole 'nuther story.

http://www.msnbc.msn.com/id/6827519/ The social security crisis is just hype so our financial institutions can get their greedy hooks into it. The pot is huge and if they can filter it to themselves they can loot it like they love to do.

Well, on paper that’s true, but we’re not actually saving that surplus; it just reduces the overall federal deficit slightly.

The US income tax rates are not flat; the rates rise from 10% to 35%, and deductions and exemptions reduce the effective tax rates for low incomes to 0%. (Capital gains tax rates are mostly flat, however.) State tax rates vary widely, some being very progressive and some being mostly flat.

I don’t actually understand the question, though; it seems to be referring to some argument I haven’t followed. Whether or not the tax is flat (it’s not), there are still wealth transfers going on; even SS, with its slightly-regressive rate structure, involves wealth transfers. Presumably it’s the size, or the growth, of these transfer payments that is the issue, and not the question of exactly who is paying for them.

I was addressing Rand Rover’s claim that SS is a drain. It isn’t.

Now what we do with that money is a whole separate question. As you are saying, we don’t keep the accounting for SS separate (That was Al Gore’s point with the lockbox.) When the bills come due (in the form of the government bonds the SSA owns), it will be paid out of general revenue. In other words, problems with SS finances are really problems with USA Govt finances as a whole.

For what it’s worth, here’s my fuller take - Parts 1, 2, 3.

I don’t know if Social Security and Medicare funding come only from the taxes collected specifically for those from paychecks. But in both cases, the tax is a flat percentage of taxable income, with a ceiling for the SS part. I would think this is what the OP refers to as a “flat (or in social security’s case regressive) tax” (regressive because, due to the ceiling, the higher your income, the less percentage of your income goes to SS).

The other thing that the OP needs to keep in mind is that the “wealth redistribution” is about an aggressively progressive tax structure more so than where the money is spent once it’s collected.

Ah, OK, I think I misparsed that part of the OP. The rest of my post I think is in agreement with yours; the transfer payments make the whole system effectively progressive.

I’m aware of progressive income taxes. The thing that most conservatives seem to be butt hurt about is the idea that the gummint is literally taking their money away and giving it to poor people. From the sounds of it, very little of that actually occurs.

Having the rich “pay a larger part of their income for defense and infrastructure than those who could afford it less” doesn’t sound nearly so nefarious.

Without leaving GQ, I think I can safely say that the first statement is false; certainly my experience with conservatives gives a more complicated picture than your caricature. And I’m not sure how you get to the second part. You seem to be saying that “flat tax” equals “very little wealth redistribution,” which is incorrect. Flat tax rates, together with equal-share or means-tested redistribution, do give wealth transfers.

Yes, I meant very little of it occurs due to progressive taxation, and that it mostly occurs via a flat tax.