Protect the Rich

By: Adam Malle
Published On: 12/12/2007 5:20:20 PM

Republican Plan for Debt Reduction: cut spending for everything that is used for anything that might help anyone who is in need...... but don't tax the rich mans dollar. He needs all the profits he can get.

Comments



I HEAR YOU (RoCoDemsPrez - 12/13/2007 6:30:02 PM)


Have you ever heard the story of .... (OaktonResident - 12/13/2007 6:39:01 PM)
"The goose who laid the golden eggs"?  Maybe you should think about that before you blithely raise taxes even higher.

In that connection, think about some basics for the "rich" man in terms of a partial list of the governments' taxes:

Top federal tax rate: 35%
Self-employment tax:  12%
Va. tax rate:          5.75%
Sales tax:             5%
Medicare taxes:        2% (up to a $ limit)
Professional taxes:    0.36% (Arlington)
Home property tax:    ~0.1%

I am sure that I am missing some taxes.  Unfortunately, most people to do not tally up all of the taxes that are paid.          

When the incentive to work gets diminished to a certain point, people simply stop working.  As the Soviet Union proved, the comrades just won't work very hard if everyone gets the same things regardless of what they do. It's human nature.  

Also, please bear in mind that the top 5% or so of the wage earners in this country pay something like 90% of all personal income tax.  

Finally, who do you think creates the jobs that actually make our economy work via the manufacture of goods and services, such as computers, food, energy, automobiles, cell phones and the like?  



What are you talking about? (Eric - 12/13/2007 7:18:39 PM)
From what dark hole did you pull such mindless blather?  Ahhh... Feel good Republican talking points - too bad they're such crap.  And don't I recognize your username from the Hall-Smyth primary?  A Smyth supporter I believe...  You do realize she's a Democrat, don't you?

I'd be very interested in seeing a reliable source citation of that 5%/90% income tax thing.  I'm not saying you're wrong, but I'm skeptical.

Where you are wrong:
The fall of the Soviet Union doesn't prove anything about our tax structure or tax rate.  Not only was their government drastically different from ours, it wasn't exactly run the way the "pinko commie" hating crowd thinks it was.  Furthermore, the people and culture of that region can't be directly compared to the people and culture of the current day United States - meaning even if the exact same stimulus was applied to both groups it's very likely that they'd respond differently.  It's apples and oranges and proves absolutely nothing about our current tax system.

Not everyone, especially rich people, pay all those taxes you cite.  Even paying straight up it's unlikely you'd hit all those taxes.  But most wealthy have accountants and financial plans that help deflect a portion of the blow.

But my favorite is your egg laying goose.  So tell me, what exactly are all these rich people going to do if their taxes go up a bit?  Hmmmm.  I got it!  They'll move to Europe.  Or Japan.  Or Australia.  Hell, maybe Canada.  Oh, no, wait.  Everyone else has HIGHER taxes.  Shoot.  Maybe they'd be happy in a third world country.  Or perhaps they'd all move to some small tax haven island in the Caribbean and somehow figure out how to legally continue to make money in the US (or Europe) without paying taxes... good luck with that.

Look, they can try to take their ball and go play somewhere else, but even with a modest increase they've got a good thing here.  It comes down to a simple choice:  Suppose you got a job paying $1 million per year but had to pay 80% taxes or you could have the same job paying $50,000 per year and pay 10% taxes.  What would you do?  The same thing as they would.  The same thing as I would.  Take the million and bitch about an 80% tax rate while happily pocketing $155K more per year.  Nobody's going anywhere if taxes get tweaked - they'll only bitch more.



I guess people weren't working (Lowell - 12/13/2007 7:31:43 PM)
during the 1940s, 1950s, 1960s and 1970s, when the top marginal tax rate ranged from 70% to 94%. That's right, today's top marginal tax rate is about as low as it's ever been over the past 100 years. Interstingly, the economy's not so hot right now, and we've got huge structural deficits to contend with. Great stuff, that "trickle down"/"supply side" economics.  Not.



Lowell and Eric -- A reply (OaktonResident - 12/14/2007 12:16:54 PM)
First, Lowell, your marginal rates are correct but you forget that there were many more deductions in those past days so that no one actually paid anywhere near those excessive marginal rates.  Thus, your argument is flawed.

The current rates are not easily avoided under the current limited deduction system (e.g., no personal deductions, rarely get any medical deductions, et cetera).  In fact, the more money you make, the more you lose in deductions.  Look at the bottom of the tax schedule where you list deductions and you will see what I mean.  

Thus, the actual highest tax rate is 35% or higher (if you count the lost deductions).  

Second, Eric, people are not going to work hard if they take home less than 50 cents of every dollar.  At that point (taking home less than 50 cents), it is better to smell the roses than to toil for someone else's benefit.  What's the point of work -- to improve your standard of living or someone else's?

Moreover, if the rich work less, then they will need less employees.  So, high taxes has a bad economic impact on others.  

As for your $1M person and $50K person, they operate on totally different premises.  The $50K person has no choice but to work to feed themselves and their family.  

On the other hand, the $1M person can work a lot less and still fully meet the basic demands for life.  For example, the person could cut back to $300K per year and do more than quite fine.  You can calculate the loss of tax revenue on this voluntary cutback.  

And they don't need to move out of the US, which is what you assume they will do.  Instead, they will relax more by the pool or at their second homes.  They also will buy less products and services (another negative impact on the economy and jobs for others).

Finally, I'll get that cite for you on the top 5% paying about 90% of the personal income taxes and send it later today.  I should have included that in my prior e-mail.

NOTE:  Eric is right, I am a Smyth supporter.  In fact, my only political contributions in 2007 were to Connolly, Smyth, Vanderhye and Barker.  All winners.



Lowell and Eric -- Update (OaktonResident - 12/14/2007 12:36:19 PM)
Eric, my numbers (5%/90%) are not accurate.  Thank you for catching me on it.  I should have been more careful.

The 2004 numbers (per the IRS -- see http://www.irs.gov/pub/irs-soi... at line 129) are:

top 1% pay 37% of all federal personal income taxes
top 5% pay 57%
top 10% pay 68%
top 25% pay 85%

Also, Lowell, please bear in mind that the AMT tax (the alternative minimum tax of 28%) was enacted because no one was paying the high marginal rates in those past eras.



Typical Republican Shenanigans (roy for sam - 12/13/2007 8:12:17 PM)
I've stopped trying to understand Republican logic.