I’m not sure that this counts as “the same.” Even if all police did was protect property rights in some minimalist state, the BK employee has far less property than the owner does. The BK worker doesn’t have a fleet of trucks shipping beef all over the country, so their road use isn’t the same, either. Perhaps someone would say, “Well, the BK worker wouldn’t have his job if not for the roads and etc, so he’s still receiving a benefit,” I would agree, but it is not the same benefit, which was all that was in dispute.
Everyone does not benefit about the same from taxes/government. Bill Gates uses far more government money, directly and indirectly, than I do. That’s why he pays more in taxes. When fewer tax dollars go to schools, Bill Gates has a less attractive and competent pool of future employees to hire. I am relatively unaffected. Bill Gates’ wealth is dependent on a society that values the rule of law, has the ability to enforce contracts, and ensures a stable government. That matters far less to me since I have far less to lose.
This is demonstrably false. Why do you think they say people like Warren Buffet and Carl Icahn can “move markets”. The reality is that big investors like Buffet do affect earnings and stock prices because their moves inspire confidence and sway opinion. Even thousands of individual people collectively investing as much as he does in a company would not have the same effect. Just an endorsement from a guy like Buffet can often affect share prices.
I think the point mswas is making is that discussions about fairness with regard to taxes tend to overemphasize and over-sentimentalize the contributions the rich make to society. That’s not to say rich people don’t contribute, just that their contributions are typically not the ones average folks tend to value despite being portrayed as such. Many people are rich (or stay rich) because of an accident of birth or circumstance. It often has less to do with who they are or their specific actions.
Does a real estate agent selling $10 million houses do something dramatically different than one selling $500k houses? Surely, their different clientele would demand a different approach, but the bottom line is that both are selling houses. The former would make a far better income for doing a similar job. Does an bankers leveraged at 35-1 do something different that one leveraged at 5-1? Did Junior USC running back Reggie Bush do something dramatically different than current NO Saints Reggie Bush? He still sold tickets, made people tons of money, trained hard, and played well while at USC. Now, he makes millions while he made nothing back then. The only thing that changed was the leverage he had.
That’s the practical difference between what a lot or rich and non-rich people do. Doesn’t mean it’s not important, or more or less important than what a steel worker does. Just that this grand idea that rich people are changing the world with their superior drive and intellect is largely a myth.
Honestly, if you can’t see that money does indeed work, then fairness for you can never be measured. It will always be subject to something…something bordering on the irrational. There is no logical or objective way to satisfy your argument. Well, in theory yes (communism is a theory), but played out, it would either lead to a broken economy, or one with such heavy booms and busts to make society nearly untenable.
Leverage is merely the amount of pressure one can apply to a transaction. It doesn’t change the value proposition.
Again, to answer your OP, everyone should pay, even the poor and destitute. That is the most fair way to make it work. Clearly, the poor shouldn’t pay as much as the rich; no one, I think, is arguing that. Flat tax with aggressive income redistribution is the fairest way to implement tax (add in periodic re-evaluation of means testing for heightened scrutiny). However, I think that would already bloat and already bloated government, and it’s not as efficient from simply having to withhold in the first place.
So, a sales tax, a flat tax, is regressive? Can you offer one example then of a tax that is neither regressive nor progressive? Or do you consider any non-progressive tax to be regressive?
Look…you do not have to like it. It is what it is. I provided a cite earlier that a Sales Tax is considered regressive.
Here’s another:
I am not saying there should be no taxes or that a flat tax is actually unfair (certainly not if essentials are exempted). Nevertheless it remains, by definition, regressive.
We can argue what is fair or not but I think you need to keep in mind the effects of a regressive tax as well as a progressive tax. Where the proper balance lies is likely subjective in large measure depending on your economic philosophies but simply walking by thinking a flat sales tax is just peachy with no ramifications of its own is wrongheaded.
If you’re so sure that is, and it bothers you so, give away half your money to a destitute person. And after you do that you can do it again, and again, thus leveling out the playing field. That is not meant as snark. But it points to the problem of you defining “non-equality” of finances as “unfair”. If my twin brother and I both graduate the same college with the same degree and I work harder or have more talent and wind up making much more money, where’s the unfairness. If two guys join the NY Knicks in the same year and one turns out to be a better player and makes more money in subsequent years, where’s the unfairness? If two women in Thailand do piecework making dresses at home and one makes 25% more dresses in a week—and at a better quality—and takes home more money, where’s the unfairness?
You either miss my point or are attempting to skirt the question. Possibly both. The question I asked is can you point to any tax—currently in the system or one you can devise—that is neither regressive nor progressive. Surely such a beast should be able to exist. Unless, of course, you simply decide to wave a wand and decree that all non-progressive taxes are regressive.
Our system presumes that if you study hard, educate yourself, and do your job well you should be able to earn an income that should support a reasonably sized family in a moderate lifestyle.
What becomes “unfair” is when, in spite of their hard work or best efforts, those oportunities no longer exist.
What is even more unfair is the creation of a self-perpetuating, exclusive aristocracy class that controls access to the majority of the wealth, forcing the rest to compete for the scraps.
Why do people presume that a progressive tax equates to taking from the rich and giving to the poor? We all pay taxes that pay for things we don’t use. Schools the kids you don’t have yet don’t go to. Roads that you don’t happen to drive on. Police that investigate crimes not committed against you. Firemen who put out fires in other people’s homes. No one considered that “socialism” or “wealth redistribution.”
So yeah. Life’s “unfair”. But at least a proper progressive tax structure is unfair in a way that benefits society as a whole.
Relative to income, a sales tax is regressive. Relative to consumption, the tax is of course proportional. Relative to the absolute amount necessary to have a reasonable life in some place, a proportional income tax is regressive.
Socialist bastards!
As far as the OP, there should fairness in whatever burden the government places on its citizens. Some people are born taller, stronger, fatter, better looking, smarter, etc. The government has had no hand in that distribution, and it has no business, attempting to negate the effects of any of these “accidents”. We are all part of a society, and we all should contribute to the common good. The only objective measure is that is the common denominator of money. So each year we ask the populace to make their contribution. One could argue that the “fairest” way would be to simply ask each citizen for $X dollars. But balancing in the practical problems with that, we look to another solution. In doing so, though, it is still incumbent on the government to employ a system that is grounded in fairness. A flat tax, to me, is a good compromise. The rich pay more—sometimes—MUCH more—in direct proportion to their wealth. Yet, the number treats all American equally.
If Person A makes 20 times as much as person B, should he pay the same dollar amount? Arguable, but not practical. So, he should pay more, okay. How much more 5x, 10x, 20x, 100x? Well, 20 seems a logical and fair number to choose, does it not? Once you break from this you are 1) treating people differently and 2) doing so at whim? If you believe oin a progressive system, i.e., the rich should pay more because thay can, then couldn’t that same logic be used to divest every multi-billionaire from all his billions save one or two?
Again, from a fairness standpoint, income taxes represent the amount of time we each have to spend working for the common good as opposed to your sole personal benefit. And since it falls to the government to treat us all equally, shouldn’t we all put in the same number of days doing that? If we all work 200 days a year, why would some people be expected to work January - March or April while someone else just has to work January for the government?
A flat tax is one way to balance the reality of the rich needing to pay more with the ethical position of the government (and ourselves) asking the same burden from each of us.
Thanks for the cite. It kinda missed my point though. Which was that every sales tax I know of is all ready adjusted so it is not regressive.
For example, look at this chart: http://www.taxadmin.org/fta/rate/sales.html
With the exception of NC, all the state sales taxes are structured so that they aren’t regressive.
So the actuality is that ‘regressive’ sales taxes are the exception, not the rule.
I think this is a rather specious argument, however, I have no cites to the contrary, so I guess we’ll just to argue it out. Do the rich really use the government more than the poor?
Don’t poorer neighborhoods have more cops? I can’t remember seeing the last time I saw a cop on patrol in my neighborhood. Don’t we all benefit from a stable society? Since my dad found stable employment when I was a kid, I have never been to a county hospital. Who receives more food stamps, job training, and other welfare disbursements? Which is more likely to go to jail? Which group is more likely to get a visit from the sheriff for an eviction?
Are you honestly arguing that if not for government, we would be a feudal society or worse? In my entire career of writing and negotiating multi-million dollar transactions, I have never sued nor been sued (knock on wood, though my company is no stranger to lawsuits, which is why we have a litigation dept). For the most part, we are self-policing.
Honestly, I think most people’s use of the government is passive (I include good roads and infrastructure). It’s equally specious to put a value on how much someone like Bill Gates utilizes the government because he has so much to protect. If government were to break down, the rich would pay for their order directly, and fairly, by hiring their protection outright, i.e. a feudal system.
In every case you’ve shown, even Reggie Bush, the leverage shown is that the person in a given scenario has been productive. If you’re going to risk money on an unknown quantity, you’re gambling.
But, I would probably buy a $400 TV set, while a rich person would buy a $4000 TV set. And a rich person is probably going to buy expensive cars, fine dining, yachts, beach front property, and a host of other things that the poor and middle class will never touch. And they pay sales tax on those things.
I can’t see it being regressive.
Skirt what issue? If such a beast does exist I am unaware of it and so what if it does not?
When discussing taxation it is entirely appropriate to know which is regressive and which is progressive. Which is “fair” is a matter of debate but to debate it we need to know.
Personally I but into the notion of a Social Contract and have no problem with the very wealthy carrying more of the tax burden. That does not mean I espouse a Robin Hood mentality either. I simply think society is served best when the middle class is big and the low/upper classes are relatively (note the word “relatively”) small. As such the climb from “poor” to “middle class” should be generally clear of impediments that unduly drag them back (such as regressive taxes).
Some of it is unavoidable of course. I cannot imagine proving my economic status everytime I buy a case of beer. Sort of a damned if we do, damned if we don’t state of affairs. We can still work to mitigate the effects though as much as possible (and if you are buying a 42" plasma TV I don’t care what your income is…you should pay the tax same as everyone no matter what).
In a way, the progressive tax structure is also what gives them power in government. It’s worth it for the uber rich people/corporations to contract lobbyists becuase spending $50 million to get a $65 million tax break is a win. Politicians, in turn, will cater to them because it means big money in tax returns.
Same with local property taxes. Locally, a big department store got a huge property tax break to relocate their headquarters to a new county. People bitched about them getting ‘subsidized’, but the county was willing to do it because, in the end, they ended up with more tax revenue than if the company hadn’t relocated there.
And that is still largely true. But a reasonably-sized family is largely related to income.
Sure they do. There are thousands of immigrants who come to this country every year with squat who manage to realize the American Dream, albeit modestly in most cases.
Because the wealth is not be re-distributed. Wealth is being collected and used for the common good. Most of the things you mention are a form of insurance. I’ll gladly pay for the fire department to put out your house fire today because I want them around to possibly save my house tomorrow. I want as crime-free a society as I can get because I’d rather not be the victim of a crime myself, and don’t want other to benefit by hurting others by breaking the law. Notice that none of those “payments” go to individuals, they go to a common kitty that provides services that we all may avail ourselves of at some time.
I don’t see how that’s the case. If someone has a degree of talent and drive that earns him and his two kids enough to feed and clothe and house everyone, why should he get a handout? If someone doesn’t have those basics, we already have programs to help them.
It’s usually done in a much more subversive manner. Just like mswas in this thread. People argue that your sales tax on beer is regressive, so then the income tax must be even more progressive to make up for it.
But like I mentioned earlier, money is fungible. Raising my income tax and keeping my beer tax the same has the same effect on my money supply as raising the beer tax and keeping my income tax rates the same. In either case, I am effectively paying more for my beer, just because I have a big house.
Only if you think the only necessities are food and prescription drugs. What about clothes or Gasoline for instance?
Not to mention county and city taxes can add to things even more (I am acutely aware of this in Chicago).
I have no idea what this has to do with the quote of mine you responded to. But I will say that i think it is disingenuous to use the uber-rich as a metric. For every one of them you point to there are thousands thousands/million of families struggling to afford their nice home, save for retirement and put their kids through school. and as I said earlier. If you want to confiscate all the billions from billionaires, leaving them each with a mere bil or two, you’re free to argue that.
That’s fine. But you need to be able to point to a midpoint. If not, any discussion of the options in terms of fairness will simply assure mutual masturbation; it’s like us each arguing if orange is more red or more yellow, without being able to point to a pure orange.