I thought that sounded much more Twain-y than Rogers.
I just find it disgusting that the 1% are so incensed about their taxes at all. For christ’s sake, how rich do you need to be? As my accountant puts it, I should want to pay a ton of taxes…it means I’m making a ton of money. (Not to mention the fact that the rich have a thousand and one ways to play games with their money and thereby avoid taxes that the middle class working stiffs can’t even dream about.)
Well, I’ll be damned!! If I didn’t just use that quote in the most self-referential way then!
Indeed, in support of your statement, I found it at this site attributed to Mark Twain as “It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.” My feeling is still that I heard a version of it attributed to Will Rogers (paraphrasing Twain, obviously) and applying it to one of the Presidents of his time like Coolidge or Hoover. But lacking any evidence of that, we’ll just have to go with the self-referential theory.
Are you suggesting that 40% of our working population pays no income tax?
The next morning, the Imaginary Restaurant Squad arrested him and threw him in jail for Meal Evasion.
Forget the freakin’ generalities & the statistics. Here is my experience, from real life:
10 years ago, I made a lot less than I do now. I paid more of my income in taxes, because I was below the SS limit, couldn’t afford to fully fund my 401k, and didn’t own a house, so I couldn’t take the mortgage interest and property tax deductions.
Today I make way more. I fully fund my 401k, am above the SS limit so that it hurts way less than it did ten years ago, and own a house, so that I can now take those mortgage interest and property tax deductions. Not to mention that it leaves me additional room to make charitable contributions, of course, which lowers my tax bill even more.
I always knew that if I could get over the hump, I’d be able to take advantage of all those wonderful deductions that the upper middle class & rich get to take. I could choose how much tax I’d pay. And I was right.
William Buckley is just plain wrong.
<< Tax them too much, attack them for being wealthy, and they just may not show up at the table anymore. >>
When this was sent in to Cecil, it included a comment about how they might move somewhere else like Europe so as not to pay U.S. taxes. This caused me to laugh out loud – tax rates in Europe are much higher than in the US and come into play at lower levels of income.
I always laugh at the thought of people who make millions of dollars a year, complaining because they have to pay high taxes. I only WISH that I had to pay millions of dollars in taxes, and you wouldn’t hear me complain.
I prefer the following story about taxes:
Imagine that the cost of a license plate for a car in a certain state had been increased to $10,000. A man complains to the vehicle licensing department that he doesnt have $10,000. The response: “Sorry, but the fee is $10,000 for everyone who wants a car, whether you are rich or poor. Even Bill Gates would have to pay $10,000. We treat everyone equally, whether they are rich or poor.”
I’m like pantom -
We do quite well financially. We pay a smaller percentage of our income in taxes now than we did back when I made $24,000 a year.
Do we pay more in taxes? - you bet. We will pay more than $24,000 in Federal Income Tax alone this year. But total taxes as a percentage of total income have dropped. In addition to pantoms enumeration, there is also that lovely 15% capital gains rate. A smaller percentage of our income goes to sales taxes (we no longer spend everything we make). And other taxes are static or not tied to income - we haven’t switched houses for instance.
Interesting to hear your experiences pantom and Dangerosa.
One thing I have wondered about is how much different the tax statistics would be if they looked at income before rather than after the deductions to get you to “adjusted gross income”. [In practice, it may be hard to do this completely since my income before my 401K contribution, for instance, never even appears on any line of the tax form.]
BTW, they do limit deductions for us “rich” folks (I do not consider myself wealthy). I don’t get to write off completely my mortgage interest, and don’t even bother to keep receipts for charitable donations, since they never make an impact on my taxes. And I didn’t qualify for the adoption tax credit when we adopted. Being a good liberal, I think this is all well and good. There is this odd thought among people that the rich get by paying no taxes - in my experience, that is not true.
A colleague of mine very staunchly favors reducing income tax rates on the rich – he says it’s ‘unfair’ (we are both comfortably middle-class).
For some reason though, he thinks it’s OK for me to pay higher income taxes (in the form of his receiving deductions) and property taxes to subsidize the public education of his kids (he has three – I am a bachelor).
I guess rugged individualism has its limits.
Damn right! I dream of the day when I’ll be rich enough not to fill out a tax return. I’ll just ring up the government, say, “Look, I hate this damn form, I’m sure you guys don’t want to go through with it, can we just agree on a figure and I’ll write you a cheque? Look, how many billion will it take to get you off my back?”
But they can move to some places which do have lower tax rates. It has happened often enough that there was an outcry about Americans who gave up their citizenship in order to not pay taxes and some laws were considered (I do not know if they were enacted) to “punish” such people. Persoannly I find this immoral. You should be free to renounce your citizenship and all the rights and obligations which go with it. Cuba has similar laws and people who seek to emmigrate are required to pay huge amounts on the grounds that the country paid for their education etc. Gimme a break. It’s bad when people want to leave and the only way to keep them is to penalise them for leaving.
Sailor,
I work with some of the richest of the rich and I can tell you some of them are leaving the country to retire due to what they consider excessive taxation. The US can’t do shit about it either. You can say charge them a fortune all you want but truth of the matter is they already have their off shore trusts set up already so by the time they renounce their citizenry they are already out of the country with all their assets. It cracks me up when people think the government can just tax them to leave. Another truth is many corporations are moving operations out of the US due to taxation as well. We lose all that tax revenue due to over taxation as well. At some point your cutting your nose to spite your face. We see it here locally all the time. The reason so many corporations leave California is because of all the red tape, state taxation and cost of living.
jshore wrote:
This is due to the way they are taxed on the shares they own of their company stock which is only taxed at the capital gains rate if held for over a year. The bubble market is responsible for most of that and as we all know that is gone.
Very well. Those individuals (a) no longer have public services paid by the state and federal governments provided to them, and (b) no longer receive the protections of the U.S. government. In return, they no longer pay for those services and protections through taxation.
What’s the problem here? Some rich folks want the services and protections, so the remain citizens and pay the taxes. The ones who don’t want them are free to become citizens of other nations.
Everybody’s happy.
BTW, am I the only one that wants a touch of evidence as to who theses ‘richest of the rich’ you work for are?
Sua
B_D: I work with some of the richest of the rich and I can tell you some of them are leaving the country to retire due to what they consider excessive taxation. The US can’t do shit about it either. You can say charge them a fortune all you want but truth of the matter is they already have their off shore trusts set up already so by the time they renounce their citizenry they are already out of the country with all their assets.
(This is kind of reminding me of december’s recent thread about why we mustn’t risk limiting the profits that drug companies can make.) The reasoning seems to go something like this:
We must structure our economy to facilitate people’s becoming very very rich, because that creates wealth and provides tax revenues.
If we try to take any more money from the very very rich than they want to give us freely, then they’ll get mad and take their marbles and move to the Caribbean!
Maybe the problem here is not so much that we’re being too hard on the rich people, but that we have such high inequality levels that we’re depending disproportionately for our tax revenues on a comparatively small number of people who have the resources to avoid taxation. Essentially, that means that our economic policy can be held hostage by the threat of expatriation on the part of the wealthy.
At some point, we may just have to shrug and switch our policy focus from making a small minority wealthy to making a large majority middle-class: i.e., more progressive taxation, stronger labor law, higher minimum wage, and similar strategies that boost the incomes of the middle-class and poor (who, as jshore pointed out, have been doing much worse than the rich over the past couple decades). One nice thing about reducing income inequality, so that you get a large and more prosperous middle class instead of a super-rich upper class, is that it makes it a lot tougher for the tax base to bail out on you by moving to the Caribbean!
The problem of lowering your taxes simply to keep some people from leaving, is that there will always be a Cayman Islands-style tax haven somewhere in the world, unless the right-wing nightmare of one-world government comes to pass. There are no winners in a ‘race to the bottom’, except for the rich.
Publicly-held corporations are always going to do what they can to maximize income and reduce tax expenditures. If the site of their corporate registration determines their tax status, they they’ll all eventually move to the Caymans. But if we instead tax on the basis of economic activity in the United States, then where the corporate paper is located won’t matter in the least. I expect we’ll be moving in that direction.
After all, we have this excellent asset - access to the American market and skilled labor force. If you aren’t an American corporation to begin with, it’s reasonable to expect you to pay what the market will bear, in order to get that access.
And as for rich individuals moving to the Caymans, let 'em if they want, if it’s worth it to them to avoid our 39% top income tax rate, and our 15% cap-gains tax rate. If (extremely rich US citizen) Warren Buffett is traveling the world, and gets kidnapped by the Taliban, the US government will do everything within reason to help rescue him. If some moneybags moves his citizenship to the Caymans to avoid taxation, and the same thing happens to him, the government of the Grand Cayman Islands will use all of its power and influence to rescue him. 
gex gex! He’s lamenting that he doesn’t have enough money to BRIBE politicians to write laws that would lower his tax burden. He’s lamenting the AVARICE of these people. Get a clue!
Sua, I see you beat me to my last paragraph. 
I am in the Silicon Valley. I am a partner at an asset management firm that specializes in handling advanced monetizing structures for Sr. executives of high technology companies. Maybe not the richest of the rich but certainly 1% of 1%. Why do you guys always doubt everyone around here? You got bunch of liars on this BB?
B_D: Why do you guys always doubt everyone around here?
Well, this is Great Debates. Why should we waste everybody’s time arguing about something unless we can be reasonably certain we know the relevant facts? (Though I agree that it’s somewhat superfluous to ask for backup on personal information such as the kind of people you work with: if you were lying in the first place you could just go on lying, and due to the board policy of anonymity we’d have no way of independently verifying your claims.)
You got bunch of liars on this BB?
A few may sometimes lie, a few sometimes mislead without actually lying, and the majority of us every now and then just don’t know what we’re talking about. Don’t take it personally: we’re all just keeping one another honest here.
Kimstu,
That’s cool. It’s not like it’s the greatest job in the world in a 3 year down market anyway trust me. Truth is the really rich have many ways of getting out of taxes and always will. It’s the people making say 50k to 150k I worry about the most. I know many would consider them rich but really they’re not. They also have all the high taxation and none of the loopholes. They have had to pay the price of higher education and extended work weeks and our taxaton system rides this group right into the ground. What’s is really nice about this country is the middle class. If we lose that we will become like Europe and lose the ability to jump from lower to upper class. Being able to take yourself to the top is what has made us a great country IMO.