What’s stopping our former President from giving the bulk of his excess earnings to charity? The man makes more giving one speech than most of us earn in a year.
If he wants job training, after school programs & college tuition subsidized to an even greater extent, why doesn’t he, Teddy Kennedy, Jay Rockefeller, Frank Lautenberg, John Corzine, Teresa Heinz & Robert Ruben, et al. get together and start a charity to fund their priorities? It would be more cost effective (without a federal bureaucracy eating up 20% of the money on management) and they could target their money exactly where they wanted it to go.
There are several reasons why they’d never contemplate doing such - and I think most here know what those reasons are.
Well, you seemed to respond with quite a bit of support to Rune’s post that got into these issues. I also don’t understand why “entrepeneurial spirit” should be the be-all and end-all of economic and taxation policy if one can trade this off to some extent for a better quality of life for most citizens.
But, fine, if you want to stick to entrepreneurial stuff. let’s look at the Heritage Institute / Wall Street Journal Index on Economic Freedom (which ranks Denmark even a bit ahead of the U.S.). This index, produced by a collaboration of two very conservative organizations, states:
Wow, I am impressed that it took nearly a whole page before we got to this canard. I have a counter-proposal, why didn’t George Bush and Dick Cheney start a charity to fund their $200 billion party in Iraq? Hell, I am sure Halliburton would have kicked in several million alone as it would have been a great investment for them!
The serious point is that we are talking about government policy here. You are assuming that personal charity can substitute for government policy when you don’t particularly like the government function in question. When you like it, you of course don’t assume that.
The people you mentioned may have a lot of money but it won’t be enough to do all of the things you mention. That is why we have government…because everything cannot be solved at the level of individual action.
I don’t take issue with anyone who is rich Mr Moto and wants to invest their money in a business. I don’t see how higher taxes would prevent them from doing so anyway. I can easily sell my rental house and invest the money into a company that will hire employees without having to pay any kind of penalty or tax on my start-up money. If I lose my money I’ll still be able to claim my loss. If I am sucessful then I’ll get richer. Where’s the problem?
I don’t think it would be so much of an issue if the rich kept their hands off of the middle class tax dollars to begin with. (slush funds, using politicians to fight for their monetary interests, war contracts, corporate welfare)
There are two tax rates, the stated tax rates and the actual rate when deductions and credits are taken into account. I do not have a cite handy, but I believe that as the stated rate rises that the latter actually falls. Why? The punitive a tax is, the more incentive there is to escape it. So, you see a rise in tax shelters and other ways to protect income, including capital flight.
Previous posters have mentioned the effect of deductions, in addition to hiding income, I believe that they make it more difficult to review the effectiveness of a specific program. Tax deductions and credits offer a way for the government to underwrite technologies that are not quite ready to survive on their own or benefits the ‘common good’; for example pollution control devices. I would much rather this change to a direct subsidy. This way it will be easy to say in X year, we spent Y millions to decrease hydrocarbons in Portland. Was it effective? If yes, expand the program. If not, change or eliminate it.
I would advocate a modified flat tax or a step tax in order to preserve the progressive nature of our tax system. All income including capital gains, dividend and interest income would be rolled into on pot: total income. The only deduction would be a set amount per dependent. Income would then be taxed at the following rates (for illustrative purposes only):
Programs would depend on direct subsidy rather than deductions, which most of the most needy cannot use. It would be the likely outcome that a significant number of the lower wage earners would have negative tax. There are other issues and benefits, but I just wanted to give a brief outline.
Sorry, for the slight hijack (but the OP was fairly vague). I have long felt that our tax system is to confusing and cumbersome, so much so that an entire industry has developed to interpret the tax code. And that is to simply –comply- with the tax laws, let alone avoiding taxes.
I’d like those who say that a rollback of the Bush tax cuts for the rich would kill initiative to explain how the boom of the '90s happened with these dreadful taxes in place? If someone were talking about going to a truly confiscatory tax rate (90% or something) you’d have a point.
jsleek is the first of what I’m sure the Bush big lie will be - they’re raising taxes! Kerry knows his taxes will go up. Hell, for one year during the boom I was in Kerry’s rich category, (thanks to stock options) and I didn’t mind paying taxes a bit.
The tax system should be about equalizing the pain of contributing to some extent, not the amount. If I’ve got $3, taking $1 is a lot more painful than taking $333K if I’ve got a million.
And one more thing I don’t understand - why do the Pubbies think it is such an imposition for the rich to pay taxes to support the war? Right now we’re borrowing the money for it. I’d think paying a few percent more in taxes to support the war on terror would be something any patriotic rich guy would be happy to do.
This sounds like a good rule. Since I was the first violator, I’ll define how I mean confiscatory (to seize as forfeited to the public treasury). Basically, I mean that any tax rate which amounts to support of programs which are not “legitimate” functions of government. By this I mean exclusively the regulation of the use of force. I’m willing to comprimise and say that many programs which do not fall under this heading are none the less acceptable if they can be shown to be small enough. So, taxes to support the police and army are clearly ok. Taxes to support road building and emergency responses can certainly be debated. Everything else is confiscatory in my opinion. On the federal level, this means that well over half of the current tax rate is illegitimate, and so, confiscatory.
As always, I am more than willing to comprimise. If those who think that they rich are not paying thier “fair share” would simply enumerate what that is, I’d be willing to debate it. The bottom line, however, is that they never will. Despite jshore and 2sense claim that they only want to tax the rich until a disencentive is created, they will propose no mechanism for ensuring this.
Agreed. I wasn’t specifically justifying any tax policy. My post was directed Bricker’s assertion that people’s money belonged to them. I thought it valuable to point out that wealth is gathered inside a social framework sustained by the taxes in question. Property only belongs to certain people because we, as a society, say so. Like jshore I would prefer the rules of our society be decided democratically.
I have made no such claim. I merely pointed out, as have others here, that as tax rates grow higher there is less incentive to earn more. At some point you will raise taxes but take in less money. But now that you mention it, the point where you start to take in less revenue seems to me a fine percentage for the highest income tax bracket. I’d say that bracket should include everything over $2 million a year in taxable income. I will firmly support that ( somewhat indefinite ) standard. Unless a better one comes along, of course.
Yes, but at the time, tax rates were far, far, far, far higher than they were today at the top marginal levels. The top rate was in the 90% range (or was it 70% range… whichever, it was astronomical). That’s clearly too high.
Today’s taxes are nowhere near that high. For any American to whine about being “overtaxed” is absurd. Clearly, given the gaping deficits Bush has created, our new tax rates are too low (there isn’t $450 billion in fluff and fat in the Federal budget). The Clinton tax rates seemed to be just about right.
A charity won’t pay our military men and women more.
A charity won’t fund a jobs program for those out of work becuase of off shoring and the bad economy.
A charity won’t help defend America.
A charity won’t make lunches available to poor school children.
Charities and governments have very different roles and goals, and to pretend that they are the same is just flat out stupid. Charity cannot make up for underfunded programs that need the sort of funding and centralization that only the government can effectively provide.
Our budget is in deficit. We obviously need higher taxes. Makes sense to me that we should start increasing revenue by turning to those who, 1) can most afford to pay it and 2) received the bulk of the recent tax cuts.
Okay, tell me, how do you cut $500 billion out of the Federal budget without gutting our defense programs or stripping away the social safety net that prevents masses of elderly and poor from starving or dying from inadequate medical care?
Ok, but you then have to admit that not all taxes do “sustain” the social system. Some of them are unjust. Some of them are wasteful. You can certainly make an argument that taxes are useful. But it does not at all follow that wealth does not belong to those who earn it.
Well, this is true. But only in so far as we are willing to accept the principle that might makes right. For instance, it could also be said that the right to life, speech, association, or anything else are only rights because “we, as a society, say so.”.
Well, at least this is debatable. I would suggest that any tax will generate less income from some segments of society. But I take it you mean that any tax on those making over 2 million a year is ok until the amount collected in total begins to decline?
Let me muse for a second. Imagine we had some automatic formula which collected money as we earned it (for instance a monthly tax bill). Each person could be placed in an income bracket and sent a bill each month for their share of taxes. Each month we would recalculate the bill for the next month based on how much was collected the previous month. What I’m aiming for is a method to institute your idea which is more responsive and less prone to political infighting than the once a year congressional budgetary process. Congress would still set the default rate and the range within which the rates would fluctuate. But the actual adjustment based on income (or perhaps gdp growth or something) would be automatic. Did that make any sense?
How many people are really on the edge of starvation without a government check? How large do you think our military is? Do you really think that monies amounting to 40% of GDP are required to sustain these programs? How much of the economy will you filter through the government for these purposes?
In short, there are many programs which could do with a cut that would not result in reduced security or increased starvation. $500 billion out of the 2 trillion would be politically impossible. Financially, however, I think it is a different story.
The budget in 2002 was about $2.01T. It’s projected to be about $2.4T in 2005. Were masses of Americans starving or dying from inadequate medical care in 2002? Well, that’s $400B right there. Of course that’s overly simplisitic, but that’s the basic method I’d use. Roll back expenses, or just reduce the growth in spending*, until we grow out of the defict.
*Federal spending has been growing by 5 - 7% per year since 2000.
jsleek is the first of what I’m sure the Bush big lie will be - they’re raising taxes!
The big lie? That Kerry will raise taxes?
I have misunderstood what he’s been saying. I was certain he meant to raise my taxes and not the tax sheltered money he and the Kennedys and his other buddies have stashed away.
Perhaps you haven’t followed my arguments. I never said that wealth doesn’t belong to those who earn it. Rather my posts have explored what it means to earn something.
I don’t believe in “natural rights”. I’ve never seen any benefit to such a conception of rights except as a shortcut to claiming one is correct without having to put in the work to make the point. Another unwelcome effect I’ve noticed is that those who hold a natural rights view seem prone to confusing reality with ethics. Might doesn’t make right. It can make “rights” though.
Might makes policy. Virtuous or not, the policy is. It is in effect so long as it’s enforced. If a country passed and enforced a law allowing me to kill anyone I chose then I would have the right to kill someone. Even if that someone had a firm belief in some hypothetical right to life, inalienable or no, bestowed by nature or some Creator or whatever. In that society I would have the right to kill them. Whether or not killing them is the right thing to do is a seperate question.
Personally, I’ve found that thinking of “rights” as relative social constructs rather than insubstantial absolutes provides clarity. Some pull away from moral relativity because of the annoying need to think for yourself but you seem to enjoy intellectual challenges so that might not be a drawback for you.
Probably. Just to be sure we understand each other let me emphasize again that we all are subject to the same federal income tax. For the highest bracket of that tax I wouldn’t find any particular percentage too high unless it passed the point of diminishing returns.
I’m afraid I can’t make much of it. Allocating the budget isn’t the same thing as taxation. They are handled by different congressional committees. Nor am I certain you understand what you refer to as my idea. My point is that you can only raise taxes on people so much before you start losing money. I don’t have a plan to determine the level of diminishing returns.
By that I say, get rid of all the deductions. Get rid of all the complications. It’s a mess. You earn an amount, you pay a tax on that amount. Period. You don’t get taxed on it again when you invest it. You don’t get to write off all the expenses. You work, you get income from that work, you pay a tax that is a simple percentage of your income, same as anyone else, and then get on with your life. No corporate welfare, no exemptions, no nothing but one simple income tax.
Why is this so bad? I’m not arguing it isn’t, I’ve just never understood why so many are convinced it is.
I took it to mean that you were addressing the issue of what money belongs to people. I did not see your point about earning vs some other definition of earning.
Well, perhaps that is because you have focused on the historical uses of natural rights instead of the meaning of the term. Personally, I see the same failing with the idea of relativistic morality. It allows one to simply say “this is right because I feel it is” without any other justification.
But it is certainly not a seperate question when discussing whether or not to pass such a law. If you say that the morality of laws is totally seperate from the fact of laws, then you have to say that all laws are equally valid and thus equally immune to argument. I don’t think this is what you intend.
Well, I have never shied away from thinking for myself. I am not advocating any particular set of morals (in this thread anyway). In fact, I find, as I said, that relativists tend to be the ones unable to think for themselves (I am certainly not accusing you of this, just providing a counter point). I find that relativism is used to justify (after the fact mostly) lots of different behaviors. I find that thinking of morals as characteristics of reality tends to force one to think ahead more than relativism does. YMMV and probably does.
Yea. I got that.
Well, but they are part of the same process. The committees are different, but they overlap. My only point, though, was that if we want a principle which allows taxes to increase until the returns diminish, then we probably don’t want to leave it entirely up to congress to make changes in the tax rates. A new tax rate which seems reasonable in January could be disastorous by August. And by the time Congress agreed on which programs to cut to pay for a tax cut, could in fact be ruinous.
Fair enough. I am probably gettin into a hijack with this. I got a little over excited to find a liberal who was willing to discuss the principles behind how much should be taxed.
I was probaly over excited by erislover’s proposed rule regarding defining too high and too low tas rates. He has that effect on me sometimes.
