Author Topic: Not a Troll: Tell me why the rich should have higher taxes.  (Read 60125 times)

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Psychic Robot

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Not a Troll: Tell me why the rich should have higher taxes.
« on: October 01, 2008, 07:15:42 AM »
My friend and I are having a little debate (at five in the fucking morning) about this.  He thinks that lower-income families should get tax breaks and that higher-income families should be taxed more heavily.  I say that's unfair.  His rationale is that the wealthy won't miss an extra 10% of their money.  I agree, but I don't think it's a fair solution.

Now, I'm not asking for whether your support McCain's economic plan or Obama's, or why tiered taxing works, or why I'm a doo-doo head for thinking this.  I just want to know why you consider it to be fair to tax the rich more heavily than the poor.

Tshern

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #1 on: October 01, 2008, 07:25:06 AM »
Because they can afford it.

A large proportion of whatever the government provides its citizens with is funded by taxes. This includes roads, schooling, social security and such. In general, things that a vast majority of people consider good, if not outright necessary. More money on these things here mean that the quality of the services can be improved.

Poor people who pay taxes live in an interesting situation, because even a small amount of extra money they have is going to help them. One extra bread and half a gallon of milk per week can make wonders. This could happen if their income tax is reduced or something similar.

On the other hand, rich people don't get as much out of the extra money. Even if a guy with 600 million dollars got an additional two percent added to the pile, he wouldn't feel the difference. The same applies inversely as well: Take away a bread a week or take a way a million per year...

Progressive taxation also works very well. Many countries with good public services work because of progressive taxation. Frankly, there is no person on earth who deserves to own dozens of millions anyway, so increasing the taxation of the rich is quite justified.

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Elennsar

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #2 on: October 01, 2008, 07:26:21 AM »
I think Tshern summed it up.

The rich have a disproportionate share of the country's wealth. It is only logical that they pay an equivalant amount of the taxes.
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AndyJames

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #3 on: October 01, 2008, 07:31:38 AM »
It is not fair, but it is not about the person not missing the extra 10% either. It is more about there is less of the rich than there is of the poor. For example:

Pile A = 500,000 apples
Pile B = 500 apples

Tax Pile A 30% = 150,000 apples
Tax Pile B 30% = 150 apples

Increase Tax of Pile A by 10% = 50,000 extra apples
Increase Tax of Pile B by 10% = 50 apples

So, in order for government to raise, say 10,000 apples, they need to tax 2 Pile A's an extra 1%. You don't want to know how many Pile B's they have to go through or raise the tax of Pile B's by how much in order to get the same 10,000 apples...

It all comes down to net number of apples the government can spoonge off you to pay for things like Welfare so that they can stay in power.


EDIT: Spelling.

Psychic Robot

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #4 on: October 01, 2008, 07:34:41 AM »
But this doesn't explain why it's fair.  Pretend for a moment that I decide to find rich folks and pocket $5 from them*.  I then give 20% of the money to all the poor people I meet.  The rich folks aren't going to miss that money.  The poor folks are going to be happier.  This practice, however, is clearly unfair, even though everyone is the same or better off.

*No, I'm not saying that progressive taxation is like thievery--I'm just using it as an example.
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Frankly, there is no person on earth who deserves to own dozens of millions anyway, so increasing the taxation of the rich is quite justified.
Why?

PhoenixInferno

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #5 on: October 01, 2008, 07:35:56 AM »
Assuming you are familiar with the American way of doing things (and since 5 AM is Eastern time, I believe you do):

0) Hopefully, you are not suggesting taxing the shit out of lower income taxpayers in order to recover the income.  Because that's fucked up.
1) To whom much has been given, much is expected.
2) The wealthy benefit from government more than the poor.  Disproportionally, in fact.  Their employers tend to subsidize their health care, the interest on their first mortgages are tax deductible, the government subsidizes their retirement through 401(k) plans and IRAs, etc.  That money that they don't have to spend then gets to go toward things like education (tutors, private schools - which if I remember correctly can be subsidized by the government as well through Education Savings Accounts).  Provided the children get raised right (and there really is no guarantee), there's a positive feedback loop of prosperity. Lower income families tend not to have access to those things.  In fact, lower income families tend get locked into the opposite cycle of poverty. 

Is that fair?
« Last Edit: October 01, 2008, 07:38:15 AM by PhoenixInferno »

Elennsar

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #6 on: October 01, 2008, 07:36:56 AM »
As stated, the rich have a dispropotionate share of the wealth. Accordingly, they owe an equivalant amount of the taxes.

If you have 80 apples, and I have 20 apples, having only 18 apples is much more limiting to me than having only 72 apples is for you (if we lose 20% of our apples).

At some point, I wind up with too few apples for my needs. You still have plenty left over.
« Last Edit: October 01, 2008, 07:38:40 AM by Elennsar »
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Psychic Robot

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #7 on: October 01, 2008, 07:39:01 AM »
0) Hopefully, you are not suggesting taxing the shit out of lower income taxpayers in order to recover the income.
No.  That would be more unfair.
Quote
1) To whom much has been given, much is expected.
Yes.  But it's a shame that we have to force people into doing this.
Quote
2) The wealthy benefit from government more than the poor.  Disproportionally, in fact.  Their employers tend to subsidize their health care, the interest on their first mortgages are tax deductible, the government subsidizes their retirement through 401(k) plans and IRAs, etc.  That money that they don't have to spend then gets to go toward things like education (tutors, private schools - which if I remember correctly can be subsidized by the government as well through Education Savings Accounts).  Provided the children get raised right (and there really is no guarantee), there's a positive feedback loop of prosperity. Lower income families tend not to have access to those things.  In fact, lower income families tend get locked into the opposite cycle of poverty. 

Is that fair?
That is more fair, yes.  Really, though, I wouldn't be satisfied unless there were some kind of overly-complex workaround in place.

Then again, I've always been an idealist.  It's a nasty habit, you know.  Truthfully, I'd like to quit.
« Last Edit: October 01, 2008, 07:43:44 AM by Psychic Robot »

PhoenixInferno

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #8 on: October 01, 2008, 07:42:27 AM »
Quote
1) To whom much has been given, much is expected.
Yes.  But it's a shame that we have to force people into doing this.
Well, you can always exist outside of society.  The "Social Contract" only exists for the benefit of its members - if you don't like it, then get out! :)  And there are people in the United States who choose to do that - live off the grid, so to speak.
Quote
2) The wealthy benefit from government more than the poor.  Disproportionally, in fact.  Their employers tend to subsidize their health care, the interest on their first mortgages are tax deductible, the government subsidizes their retirement through 401(k) plans and IRAs, etc.  That money that they don't have to spend then gets to go toward things like education (tutors, private schools - which if I remember correctly can be subsidized by the government as well through Education Savings Accounts).  Provided the children get raised right (and there really is no guarantee), there's a positive feedback loop of prosperity. Lower income families tend not to have access to those things.  In fact, lower income families tend get locked into the opposite cycle of poverty. 

Is that fair?
That is more fair, yes.
I'm not sure I understand your "yes" there.

Psychic Robot

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #9 on: October 01, 2008, 07:44:58 AM »
The "yes" means "I'm agreeing with your assessment, although I haven't thought upon it enough to make a firm decision regarding it."

AndyJames

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #10 on: October 01, 2008, 07:45:32 AM »
As stated, the rich have a dispropotionate share of the wealth. Accordingly, they owe an equivalant amount of the taxes.
They didn't get it handed to them. They worked for it. Why are they being punished for working?

Elennsar

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #11 on: October 01, 2008, 07:52:22 AM »
Ignoring inheritance...

They're not being "punished". As stated, if you have 80 apples, you lose far less so far as your needs (which are all anyone is entitled to...your wants you have to earn/deserve/whatever) go if you lose 40 apples than I do if I lose 10.

Similarly, the premise that the rich "worked for it" has one fatal flaw.

It is part of the capitalism system to assume that those who are, in a word, worthy, will prosper. Those who work hard, are smart, ruthless, ambitious, capable, whatever, will prosper.


The problem is that it is not true. Plenty of talented people die in poverty not because they lack ability but because the system is set up so as to give great riches to a few who figure out how to (ab)use the system, rather than to reward those who are capable of producing something (for purposes of this statement, being an effective middleman does count as providing a service.)

So, if the amount necessary to live comfortably (the equivalant of $100,000-500,000...I'm a Californian, so I use this sum. Adjust for how less overpriced your state is.) is 13 apples, you are still well above that if you lose half your apples, which can be used to help those who are less fortunate. Meanwhile, I'm 3 apples short if I lose half my apples.

The apple metaphor doesn't begin to cover how much is needed to cover governmental costs, such as roads (which benefit all, social security and such being justified is a seperate arguement), and as stated, those with most of the wealth should be taxed accordingly.

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PhoenixInferno

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #12 on: October 01, 2008, 07:53:46 AM »
As stated, the rich have a dispropotionate share of the wealth. Accordingly, they owe an equivalant amount of the taxes.
They didn't get it handed to them. They worked for it. Why are they being punished for working?
The uber-wealthy that everyone likes to rail against don't pay taxes for "working" :)  At least, in America, this is the case - because they tend to pay taxes at the long-term capital gains and/or qualified dividend rates, which are currently EXTREMELY low compared to marginal income tax rates.  Thus, the uber-wealthy have little incentive to "work" choosing instead to make their money through investments.

This (and the estate tax) is what Warren Buffett rails against.  That the current American tax policies gives you an incentive to create dynastic wealth, which is (in his and my opinion) fundamentally un-American.

Similarly, the premise that the rich "worked for it" has one fatal flaw.

It is part of the capitalism system to assume that those who are, in a word, worthy, will prosper. Those who work hard, are smart, ruthless, ambitious, capable, whatever, will prosper.


The problem is that it is not true. Plenty of talented people die in poverty not because they lack ability but because the system is set up so as to give great riches to a few who figure out how to (ab)use the system, rather than to reward those who are capable of producing something (for purposes of this statement, being an effective middleman does count as providing a service.)
1) That people can try and fail in a capitalist economy does not address the point you try to raise regarding whether the wealthy "earned" their money.
2) No, that is fair - Capitalism isn't intended to guarantee anything to anyone.

I also take offense to the notion that success in a Capitalist economy necessitates cruelty to others.  There are lots of new companies with business models that are friendlier to the idea that society succeeds together.  You claim to live in California - I'm sure you know of them.
« Last Edit: October 01, 2008, 08:04:35 AM by PhoenixInferno »

Psychic Robot

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #13 on: October 01, 2008, 08:01:02 AM »
On the one hand, people have worked for their money and have managed to save up a good sum of it--why shouldn't they be allowed to keep it?  On the other hand, there's the whole idea of the American dream, where people can come to America, work hard, and end up at the top.

Elennsar

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #14 on: October 01, 2008, 08:03:19 AM »
The problem is that the American dream is a lie. Even assuming a totally honest and just system, it is a lie. Capitalism is fundementally set up to prohibit hard working and determination from being enough.

And the same reasons for those who worked hard as those who inherited apply.
Faith can move mountains. It still can't deflect bullets.



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AndyJames

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #15 on: October 01, 2008, 08:04:13 AM »
The problem is that it is not true. Plenty of talented people die in poverty not because they lack ability but because the system is set up so as to give great riches to a few who figure out how to (ab)use the system, rather than to reward those who are capable of producing something (for purposes of this statement, being an effective middleman does count as providing a service.)
Really? So, all those "fatcat" CEOs of investment companies and finance companies didn't work a single day in their lives, eh? I mean, it was all "handed to them". Yeah. Call me enlightened now. [/sarcasm]


Just because someone *can* afford something does not mean he *should* lose more. That is just plain "I have less than you and I want more, so frakk you, give it to me, you filthy bastard" way of thinking. You know what we generally call some of the people who think like that and act on it in society? Robbers. Burglars. Pursesnatchers. Blackmailers. Criminals.

Psychic Robot

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #16 on: October 01, 2008, 08:05:29 AM »
Quote
The problem is that the American dream is a lie.
Yes, I'm well aware of that, heh.

The thing is, none of us are part of the ultra-wealthy group (I'm assuming).  It's easy for us to say, "You should be paying for things because you won't miss the money!"

AndyJames

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #17 on: October 01, 2008, 08:07:08 AM »
On the one hand, people have worked for their money and have managed to save up a good sum of it--why shouldn't they be allowed to keep it?  On the other hand, there's the whole idea of the American dream, where people can come to America, work hard, and end up at the top.
You don't have to end up at the top. Working your way out of poverty and into the middle-class ranks is an achievement in itself. It gives the next generation a springboard into higher levels. My family is living proof that that can happen. The dream is not dead. It just doesn't solely belong to America any more. It is now a global thing. Except in the socialist states where everyone must be the lowest common denominator or face being pilloried.

AndyJames

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #18 on: October 01, 2008, 08:10:52 AM »
Yes, I'm well aware of that, heh.

The thing is, none of us are part of the ultra-wealthy group (I'm assuming).  It's easy for us to say, "You should be paying for things because you won't miss the money!"
I don't. I personally think that it is unfair. No, I am not wealthy. To many, especially the "gimme, gimme, gimme" "I am entitled!" crowd, my earnings would not be enough for them to be happy. But *I* am relatively content with that part of my life. The question to ask here might be: Why?

PhoenixInferno

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Re: Not a Troll: Tell me why the rich should have higher taxes.
« Reply #19 on: October 01, 2008, 08:11:09 AM »
Just because someone *can* afford something does not mean he *should* lose more. That is just plain "I have less than you and I want more, so frakk you, give it to me, you filthy bastard" way of thinking. You know what we generally call some of the people who think like that and act on it in society? Robbers. Burglars. Pursesnatchers. Blackmailers. Criminals.
All taxation can be thought of that way.

If you accept that government needs funds to perform its functions, then you have to answer the question of who pays for it.  The flat tax is awful - it raises the taxes on the poor to a level that is unsustainable.  I mean, if they're having trouble now when they're not paying taxes because of the brackets, then they ain't gonna make it when they have to pay taxes.  It can work - only if you drastically reduce the scope of government so that everyone's taxes are reasonable.