The most straightforward way to lift the cap while cushioning the tax increase is to introduce a minimum below which income is not taxed, and increase it by some fraction of the increase in the cap (e.g. raise the cap by 10k and make the first 5k of income tax-free, increment-lather-rinse-repeat a few times). Obviously, the fraction would depend on the balance between revenue enhancement and blow-cushioning.
I don’t understand these “raise the cap” arguments. Social security taxes are capped at ~$100k in income because at retirement, you only get benefits based on a ~$100k salary. It’s not supposed to be another suckling at the teat government handout. It’s supposed to be a deferred payment plan.
If you want people to pay FICA taxes up to $50 million, the government should pay out benefits on a $50 million salary.
In that an invading army poses a threat primarily to the life of a citizen, then unless you consider a rich man’s life to be worth more than that of a poor man, the defending army does indeed provide an equal service to both.
Invading armies usually do not kill everyone in sight. They invade cuz they want your stuff.
Rich people have more stuff than poor people.
I favor progressive taxes, but sometimes regressive taxes are the only way to get things done on a local level. A good example is municipal or countywide sales taxes voted in for local infrastructure projects. They are regressive almost by definition, but offer the advantage of clearly demonstrating the political will to get the projects built, and that can lead to further funds from other sources.
A rich person takes much less time to earn the same amount of money. It seems like a real justification for a progressive tax even if you don’t agree with it.
http://thinkprogress.org/wp-content/uploads/2012/07/min-wage-info1.png
That the rich can more easily spare the money while the poor can’t is certainly a real justification, whether one agrees or not.
I’m also not sure about more government resources per capita. Do we count business subsidies as resources consumed? Cost of infrastructure that is used by businesses? How does Bill Gates become a billionaire without consuming the resources required for infrastructure allowing computers to be manufactured and delivered to consumers, the internet to be researched, developed, and maintained, etc? (I see someone already mentioned defense).
Maybe you should define “real justification”. Does that just mean reasons you agree with?
I generally don’t answer snarky questions, but no, I’m not viewing this question solely from my perspective. Are you viewing the issue solely from yours?
Infrastructure benefits everybody. To say that the eeeeevil rrrrrrrich are the primary beneficiaries of roads, bridges, and railroads is just plain silly.
Another thing wrong with your populist view of the rich–they may earn money faster now than others, but that wasn’t necessarily always the case. Many rich people started as entrepreneurs, and earned virtually nothing, or lost money while they were building their businesses. The government (which, in general, hates small business) doesn’t mail you a rebate check when you lose fifty grand in your start-up business. Thus, a rich person’s earning capacity should be viewed in terms of his lifetime experience. The tax code only allows tiny loss carry-forwards, so the person who loses 200 grand over five years and then makes 300 grand the following year is taxed on the entire amount, when in reality, over the last six years, he’s barely earned the poverty-level wage. But now he’s an evil rich person and is fair game.
Also, every justification for taking (more) money from the rich falls into one of four categories or a combination thereof:
- They have it.
- They don’t deserve it anyway.
- They can spare it.
- We pretty much have to take it, because the whole system collapses if we don’t, so screw any other considerations.
You are missing an important step. Before any of this there is an agreement on how much the government should spend, and in principle how much revenue it needs. Then you decide how to get the revenue. Given this, if you decide to tax the rich less you are automatically taxing the non-rich more. Which is stupid.
Now, you can claim that taxing the rich less will lead to more money through the magic of investment and job creation, but it appears not to work that way.
So, assuming that Republicans aren’t all stupid, we can only include that the motivation for cutting taxes on the rich is to force a cut in the size of government, and do way with all those policemen, firefighters and teachers Mitt says we don’t need.
But precision is not that important. No one is advocating a system to equalize pain to three decimal places. For the most part $1,000 is more important to a poor person than it is to a middle class person, and much more important than it is to Bill, Gates (or Mitt Romney.)
I think we make the mistake of thinking that government is something we purchase with taxes and then consume (or benefit from) in various quantities. Taxes are something we pay to enjoy the benefit of society, the government is simply a management vehicle and yes, those with great wealth do derive greater benefit We should not be asking how much government do we get for a given cost, but rather, ask how good is the government at managing the value of society as a whole.
This pops up every thread we have. Look, you can either talk about absolute dollars and benefits or you can talk about percentage dollars and benefits. Yes, the rich consume more benefits from having a government enforce law and order as well as resource ordinances, but they also pay more money for those things. If you want to argue that the rich should pay more per dollar out of their income, then you have to show that they consume more per dollar than others.
You know, I am so sick and tired of this argument. You never see it because you only want to count taxes, i.e. the forceful taking of wealth and property. You never count charity, i.e. the willful giving of wealth and property. I’m a conservative. I believe in the fundamental right to be a jerk, and that means the government can’t and shouldn’t force me to be nice to you. This includes sharing.
And yet I send more money to starving kids overseas per month than this internet connection costs me. Why don’t you give me any credit for that? Why do you only count the money being forcefully taken from me, and not that which I give freely?
That doesn’t shed any light whatsoever on who should be paying what. No one wants to eliminate taxes or turn them up to 100%, so your notion of “paying to enjoy the benefit of society” doesn’t really factor into the decision. The question is how much and who should pay it. Asking how good the government is as managing the money isn’t relevant to answering those questions.
The oil depletion allowance is only available for producers of oil or gas up to 1,000 barrels of oil or 6,000 mcf of gas. In other words, these are individual royalty owners and very small independent companies. Please explain how this is an example of corporate welfare when large corporations are not able to take it.
My God, what an oversimplification/distortion.
If you tax the rich less, you don’t automatically have to tax the non-rich more. Not all government revenue is collected via income taxes, not by a long shot.
I would also point out that planned spending can be reduced if the prior year’s tax revenues weren’t up to snuff, in anticipation that this year’s revenues will similarly fall short. Just because our government doesn’t seem inclined to do this doesn’t mean it can’t be done. There are two things that can be done when revenues don’t meet expenditures.
A tax on the rich, who are the most productive, is indeed a disincentive to growth and investment. It does, in fact, appear to work that way.
A reduction in the size of government doesn’t necessarily mean that we fire all the firefighters, teachers, policemen, etc.–to say that is ridiculous, because those are essential services; it would be like a cash-strapped family trying to save money by cutting off the electricity and water. There are myriad ways to cut spending without causing pain to the non-rich. Getting the hell out of Afghanistan would seem to suggest itself, but there are plenty of more prosaic solutions, such as actually (as opposed to the recent feeble gestures) cutting waste and fraud in entitlement programs, and eliminating government programs such as the Federal Walnut Board and the Tarantula Eradication Program. (I made those up, but wouldn’t be surprised if they actually existed.)
Even if you believe somehow that the rich are an endless source of funds, and that it’s fair to bleed them more or less indiscriminately, the fact remains that if you take x% of someone’s money, at some value of x, that person won’t see the point in earning the same amount next time. He also won’t make speculative or risky investments if a large marginal tax distorts his risk/reward ratio. “Rape the rich” is oh so appealing, but in the long run, it not only doesn’t work, but produces the exact opposite effect from that which was intended.
Actually, Voyager’s post was a cogent clear synopsis.
Some recent large spending proposals are made precisely because of the poor economy. You might want to read up on Kenesianism.
Do you have a cite for this? Whenever the topic comes up here, research is found to point toward this meme being false.
Interesting that the examples you give for wasteful government programs are fictional. 
Any real examples? “Serious” GOP proposals include eliminating Dept. of Education, much of which money is spnet hiring teachers. Is that your plan? Or will you stick to Walnuts and Tarantulas?
I’m glad I’m not rich. Their treatment in U.S. society seems so unfortunate.
A chart here shows that productivity has increased greatly while workers’ wages remained stagnant. This indicates that the rich are becoming more rich on the backs of the workers who are creating the wealth.
Didn’t this “on the backs of the workers” trope become stale by, oh, 1907 or thereabouts?
The flaw in your statement is in assuming that the sole beneficiaries of that increased productivity are the eeeeeevil rich Simon Legrees/Mister Burns who rub their hands together gleefully as the sweating slaves toil on the factory floor below.
In reality, increased productivity means lower prices and greater availability of goods–to the consumer.
Now, that’s funny.
What’s ironic is you probably don’t realize the blinding, crystal-clear truth of that statement.