Yes. It’s this very recent invention in fiscal policy called “you can’t get blood out of a stone,” sometimes shortened to “fairness.” Poor people ought to pay very little in the way of taxes so that they can afford basic necessities, like, say, food. People with more money, like you, me, and many others, should pay higher tax rates because we can afford to.
I said the wealthier should pay more taxes. You said you agreed, which is why you support a flat tax. The thing is, you don’t actually agree with the point I was making, in that I was referring to the middle and upper classes paying progressively higher rates of taxes, not paying more dollars based on a fixed tax rate. Nevermind, the point seems more important last night.
Help me out on this. You support two tax systems which claim that they will impact the poor less that the current system (flat tax and consumption tax – a claim I find false, BTW). So you would seem to support tax systems in which the poor would basically pay nothing.
But at the same time, you think that the poor should essentially choose whether to pay a tax on their wealth or on their time.
Tell me, when Neal Boortz, Steve Forbes, and other proponents of the Fair Tax or the flat tax talk about how the poor will pay less in taxes under their system, do you have a philosophical disagreement with them? In that the poor ought to pay more?
We are talking about federal taxes. The working poor, who don’t pay “income” tax, still pay a share of their income in federal taxes. That is – they still pay an income tax, it’s just called something else. This is not any sort of clever wording or trickery. That is simply what FICA is – it’s a tax on income; i.e., it’s an income tax.
Under Obama’s plan, the working poor will pay less, but will still be paying tax to the federal government. In what way is it then a lie to say that these people will pay less tax, but not no tax? Why is the denomination of these as income or payroll taxes important? It’s not.
In this country we like to pretend that payroll taxes are something we can ignore for purporses of analysis. But they’re not. As noted, for the working poor and the lower middle class, they are by far the largest component of federal tax. And unlike the federal income tax, they’re hella regressive, like all “flat” taxes. Except it’s not even flat, because people in the top 20% or so of earners get to stop paying it. So it’s not any kind of deception to say that these people will get a tax cut under Obama’s plan, because their taxes will be cut. And it’s not any kind of welfare, either, because these people will still be paying tax to the federal government – just less.
The focus on the federal income tax to the exclusion of all other taxes is aberrant. A dollar is a dollar. Who gives a fuck whether it’s paid to the federal income tax, the payroll tax, or some other tax. You still can’t use it to buy your baby’s shoes.
Social Security is not in trouble. There is no Social Security crisis. According to the Bush’s own Administration, the SS trust fund is already going to be solvent until the mid or late 2040’s. What will happen in the 2040’s? The Baby Boomers will all be dead, and therefore the payouts required will drop immensely.
Medicare and Medicaid are a different story, but only because health care costs themselves are increasing at breakneck pace. If we solve the health care crisis, we will solve the so-called entitlement crises as a bonus.
There was a lot of fraud and abuse, esp by Mexicans (you are allowed to claim your kids in Mexico* for an exemption, but not for the EITC.) A lot of questionable “tax preparers” made a lot of money a decade or so ago by telling their clients that they could claim the EITC. When the IRS made SSNs a requirement to claim an exemption, it also cut back into this abuse.
Abuse still exists amoung non-married couples *living together *who too often both each claim one of the two (or more) kids to make them eligible for HoH, then one of them uses a PO box or similar mail drop for the address.
I guess I never thought of Medicare and Social Security taxes as part of the general revenue. I thought they were payments so that you could participate in the system later. Medicare and Social Security weren’t/arent’t, at least I thought, welfare programs provided by the government. Workers pay for them, and then reap the benefits.
So, why shouldn’t a poor worker pay these taxes? They get the benefits later in life, and as I said, they aren’t handouts…
Do you have a cite for that and to provide how much money was actually lost to this fraud?
And I’d just like to throw in that our income tax system has been progressive since its inception and ‘fairness’ and ‘penalize’ are terms that are subjective depending on where you’re sitting.
Current retirees don’t collect the money they put in… So why would today’s workers collect what they did or didn’t put in? That’s not how the system works.
Obama wants to say “95 percent of people will benefit more by the tax plan I am proposing than by McCain’s plan”. But saying that isn’t clear enough for anyone. Benefit? Benefit how? Will I get more money, or what? “Well, some people pay X% of taxes, and they’ll pay less taxes, while some people who by Y% taxes will get a higher credit, because they…” [snore]
He needs to fit the description of his plan into a soundbyte. He explains his plan in detail to anyone (like yourself) interested in reading the particulars. He’s not hiding or misleading with his plan, he just has a short commercial-clip version that almost everyone can immediately understand and grasp, and a long version where people who are more politically inclined can decide if they like the particulars or not. If you’re against giving people who pay zero income taxes a bigger tax credit, well then by all means include that in your inner-debate about how to vote. But don’t mistake anything about it for deceit.
That’s an extrapolation. You don’t give labor hours… you give a portion of the earnings from your labor hours. At no point do you get nothing for your labor hour.
Social Security has always operated under a model where the current generation’s workers paid for the current generation’s retirees. You’re paying money now for your father (or grandfather) to collect benefits. How else could the first generation of Social Security collectors get it?
well if it encourages fraud, that’s an important point to make. I was curious to see how badly the EITC was abused. And to tie into the thread - Obama’s refundable tax credit is $500 per worker. So we’re talking about a maximum of an additional $1000 per household with 2 incomes.
Poor workers do pay Social Security and Medicare (payroll/FICA) taxes. Those taxes are withheld from minimum-wage workers’ paychecks just like they are from yours and mine.
In some cases, the EITC received by poor workers is enough to offset the payroll taxes as well as the federal income tax, simply because their incomes are so low that the EITC covers everything they chip in.
I swear, I just don’t get what a lot of you anti-tax conservatives are driving at with your insistence on taxing the poor. You squeal in outrage at the idea that a wealthy person making more than $250K annually might be required to pay any additional tax, even if it’s an amount that won’t impact their extremely comfortable lifestyle at all. But then you get all upset because workers at or near the poverty line get a negative tax rate just to help them stay fed, clothed and sheltered.
Where do you suggest that poor workers should get the money to pay income tax? I know where rich workers and middle-class workers like you and me get it: out of our bank accounts. But how are you proposing to make it possible for the lowest-income workers to survive with a positive tax burden and not live in wretched poverty? If you don’t like refundable tax credits, what alternative measures are you recommending? Do you support raising the minimum wage and strengthening labor laws so that low-income workers can make more money? Do you support rent control laws or subsidized housing or other means to hold down the cost of living for poor people?
Remember, your and my comfortable lifestyle depends partly on the fact that the cost of many goods and services is quite low because many people are willing to work for very little money. Either support their earnings with a negative income tax, or pay them higher wages up front.
Or else just come right out and say that it’s fine with you if hard-working low-income wage earners go cold and hungry because they can’t reliably afford the basic necessities of a decent life. At least then we’ll all know where you stand.
Unless you’re on some sort of community service or work release program, you aren’t donating labor hours.
You’re being charged a tax on your earnings.
I have no clue why you think you can score points in this debate by altering the plain definition of the word “tax.” It is really a contrived, senseless, and unsupportable effort. Folks can work a huge number of hours to make a certain amount of money, or someone can not actually work any hours at all and get the same amount of money (e.g., residuals or royalties for creative pursuits). Clearly, the IRS is not forcing someone who didn’t actually labor to get some amount of income to perform additional work.
Moreover, there’s this idea that rich people aren’t getting something for the taxes they pay. That’s simply not true. You get miiltary protection. You get the court system. You get your own Social Security and Medicare. You get a regulatory apparatus that, when it’s not hampered by foolish deregulatory zeal ensures that you can put your money somewhere other than under your pillow and you’ll still be able to get it out. You get running water. You get an education for yourselves and your children. (Even if you go to private school your education is still federally subsidized.) And finally, you get an ordered society where you can be capitalists and not have to worry about revolution or civil insurrection around every corner.
It is inhuman to not care about the treatment of those in society not born with your advantages, or your luck. But even if you are such this inhuman, it’s still a good idea to support the social welfare state. Because otherwise, I’m comin’ after your shit with a big-ass knife.
Lets look at that statement and see:
Family of 4 with an income of $16,000
$8,400 - HUD section 8 money - $700/month x 12 months = $8,400
$4,500 - Earned income credit for 2 kids $4,500
$4,800 - Food Stamps: $400/month x 12 = $4,800
$17,700- Total per year
Add in Medicaid - $8,000 (low ball guess based on HMO costs) and now you’re at $25,700 worth of benefits.
None of the above includes child day care assistance. I couldn’t make heads or tails of the co-payment schedules.