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A Minimum Tax for the Wealthy

nytimes.com

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Re: A Minimum Tax for the Wealthy

#111

Post by rdl »

rayiner wrote: post #95
ruby_on_rails wrote: post #35

Earlier quoted context omitted.

I think what nugget is getting at, is there are many government programs that are mismanaged (welfare, social security, education to some extent, and others). Who legitimately feels good that they pay taxes only to see other Americans living off of Welfare, generations unemployed, living off of welfare (which btw, I consider to be fraud). People that live on welfare (no, not people who use the program as it was inten…

Broken by what measure? Relative to what? Is the government mismanaged compared to say Google? The federal agency I worked for was a much tighter-run ship than the startup I worked for, or the medium-sized tech company I worked for. I'd wager the federal government, or at least most of it, is better-run than most small and medium sized businesses in the US. The caliber of people in most of the agencies is just extrem…

Many areas of the federal government are actually pretty good by commercial standards (at least for caliber of employee), but most state governments are by comparison pretty horrible (particularly California). However, they're much more concerned with fairness and being abused by third parties, since they aren't as constrained to succeed or die. It is better for an employee of a government entity to follow process 100% correctly and ultimately fail than to take a calculated risk outside of normal process and fail, even if the expected return on the riskier path is far higher, or odds of failure lower. Startups are exactly the opposite, since they die by default. Big businesses are somewhere in between -- a new product failing usually won't kill the business if it fails cleanly, but could if enough corners are cut.

The ultimate difference between private firms and government is that a private firm which is seriously screwed up will go out of business. A government agency can continue being dysfunctional for a long time (e.g. the Office of Thrift Supervision). The other big difference is that when a government entity is incompetent, it tends to hurt others a lot more than when a single commercial firm is incompetent.

Re: A Minimum Tax for the Wealthy

#112

Post by gwright »

ianb wrote: post #98
gwright wrote: post #82

Earlier quoted context omitted.

As if 'framing' isn't an important part of communicating ideas? In this case you chose to frame the discussion in the form of the government 'giving' its money to the people. I'm rejecting that formulation. That doesn't mean I'm rejecting the idea of taxes or more specifically progressive taxes.

I offered a thought experiment, and using the example of "giving $1,000" is easier to think about than "not taking $1,000". As a thought experiment they are equivalent, with respect to the question: who utilizes resources most efficiently? By introducing variability of how much the government takes total it adds another question that is being used to persistently distract from the question of progressivity. When peop…

OK, I'll accept that you weren't intending to suggest that the government has primary claim on your income but you seem unaware of how your framing has been used by others to actually make that claim.

I can accept theoretically that you can separate the progressive structure of the federal income tax from spending decisions but in reality it is pretty hard to solve our budget problems by simply taxing the 'rich'--at least if you use the $250,000 figure that is most commonly used.

Here is a nice calculator you can use to see the difficulty: http://splitwise.com/taxes/

Re: A Minimum Tax for the Wealthy

#113

Post by prostoalex »

notJim wrote: post #75
prostoalex wrote: post #56

Earlier quoted context omitted.

wealth == accumulated assets, but wealth != income High-income people are frequently wealthy (outside of incomes derived through lottery winnings), but the two are not equal in their political views - those sitting on their wealth will be in favor of income taxes (since they barely have any), those who work for income will lean in favor of asset and consumption taxation (property, estate and sales taxes).

This seems like a riskily reductionist point, as we know that people aren't always single-issue voters focused on achieving their financial best interests.

Oh, definitely. Even folks who are single-issue voters realize that outside of supermajority years executive branch of government has to compromise.

However, the anecdotal evidence of "stored wealth vs current income" tax is there, notice how "let's-back-tax-everybodys-income" Prop-30-happy California is also home to "dont-you-dare-to-raise-taxes-on-my-mansions" Prop 13. My original remark was to point out that wealthy people and high income people are frequently advocating opposite causes.

Re: A Minimum Tax for the Wealthy

#114

Post by forensic »

brg wrote: post #101
forensic wrote: post #20

Earlier quoted context omitted.

Entrepreneurs only work for human beings with money. Who works for those without? It doesn't matter how inefficient government is. Government is the only entity that works for the disadvantaged. Government is also the only entity capable of addressing collective problems.

Government is the only entity that works for the disadvantaged. The Red Cross, the Salvation Army, the Catholic school and hospital network (CRS), Doctors without Borders, Lutheran World Federation, the ACLU, etc etc etc.

You have confused the customer with the product.

Re: A Minimum Tax for the Wealthy

#115

Post by rpm4321 »

forensic wrote: post #91
rpm4321 wrote: post #80

Earlier quoted context omitted.

def further_proof(age, wisdom): if (age != wisdom): print "forensic"

You want downvoting privileges, but think insults are appropriate here, and even equate those insults with proofs! comic.

Look, before PG rightfully jumps in here like the SkiFree Yeti and tells us both to knock it off, let's see if we can squash this: http://xkcd.com/667/

I'll concede that my last comment was inappropriate (it's super-basic Python, not a proof).

Can you at least concede that loose talk of beheading capitalists is, at the very least, counter-productive to what we should all want, which is a robust recovery?

Are you really advocating that people like PG and Elon Musk should be murdered without due process for being successful?

If not, why say so? Even solely as a rhetorical device, it's extremely distasteful, polarizing, and makes a rational person discount anything else you might have to say on the matter.

Or maybe you and people like you have no intention of really following through with these threats - they're just attempts to bully political opponents into adopting your tax policies. So, we're just talking soft-extortion here, not outright plans of murder and violence.

How about "evil" financiers like Warren Buffett (or is he "one of the good ones"?), or the other bankers and financiers - many of whom heavily donated to Obama, some of whom even served in his administration. Should the chopping block be reserved just for them? Do they get a pass if they donated to the right political parties and organizations?

This extreme demonization of capitalism is really troubling to me, and I think it helps explain the sluggishness of the economic recovery. The holders of capital are a bit spooked, and rightfully so.

Re: A Minimum Tax for the Wealthy

#116

Post by brg »

hackinthebochs wrote: post #45
forensic wrote: post #25

Earlier quoted context omitted.

you know what's chilly? the blade of the guillotine. you can either share some of your money or lose all of it.

It's funny how quickly people forget. There is one inevitable end result of such severe disproportionate concentrations of wealth. I'm sure we're nowhere near that point yet, but those who argue against redistribution are guaranteeing we will get there at some point.

I take you to mean that people forget that this is the inevitable outcome, but is there proof of that? China and ancient egypt for extremely stable examples of societies with hugely disproproriate distribution of wealth. Is it possible that revolutionary France and Russia are the outliers of history?

Re: A Minimum Tax for the Wealthy

#117

Post by nhebb »

notJim wrote: post #76
nhebb wrote: post #21

> I support President Obama’s proposal to eliminate the Bush tax cuts for high-income taxpayers. However, I prefer a cutoff point somewhat above $250,000 — maybe $500,000 or so. Personally, I don't care if the wealthy pay higher taxes. In the recent election, 8/10 of the wealthiest counties in the US voted for President Obama, and his stance on tax rates was clear. If those voters are willing to pay higher taxes, I'm…

This seems like a willfully ignorant reading of the op-ed. There is context here which any reasonably well-informed person should be aware of, which is that the gains made by top earners far outstrip the gains made by middle and lower income people. As a result, those people are worse off than they were in the past (their income has failed to increase relative to cost of living increases in recent decades.) So the re…

It wasn't a willful misreading. I was addressing the part that I quoted - because it's likely to be a debate point in the fiscal cliff negotiations.

Re: A Minimum Tax for the Wealthy

#118

Post by jaggederest »

jcampbell1 wrote: post #55
jaggederest wrote: post #16

Hmm, if only such a thing already existed... http://en.wikipedia.org/wiki/Alternative_Minimum_Tax Although when anyone in my lowly tax bracket has to worry about it, it's pretty sad.

AMT + Deduction Cap would be the same thing effectively, assuming the deduction cap applied to everything . Right now the reason people make millions and pay no taxes is because they give generously to charities, and their investments are tax-free muni bonds. AMT still allows too many deductions to force all the top earners into paying taxes.

I suppose my point is that we have a feature in the tax code which is ostensibly designed to achieve his very goals, but it's become useless over time because a) it's not indexed to inflation, and b) it allows some deductions and generally adds complexity, rather than being a true flat minimum.

Re: A Minimum Tax for the Wealthy

#119

Post by brg »

forensic wrote: post #114
brg wrote: post #101

Earlier quoted context omitted.

Government is the only entity that works for the disadvantaged. The Red Cross, the Salvation Army, the Catholic school and hospital network (CRS), Doctors without Borders, Lutheran World Federation, the ACLU, etc etc etc.

You have confused the customer with the product.

That statement rings false.

The product of doctor's without borders is better health for the disadvantaged. The product of the red cross disaster relief is comfort and care in times of distress. The EAPN main goal is to elevate the disadvantaged above their current situation and prevent the cycle of poverty.

Re: A Minimum Tax for the Wealthy

#120

Post by rdl »

ianb wrote: post #105
AnthonyMouse wrote: post #93

>But what I really hate is the class warfare and populist messages driving fiscal policy. This. The thing that really gets me are the people who should know better, like Warren Buffet. You read the article and he's making straw man arguments about billionaires stuffing their cash in mattresses because their taxes are too high -- nobody is arguing that. The real problem is that taxation is economically distortionary a…

I'd kind of dismissed the idea of a consumption/sales tax as terribly regressive, but it doesn't have to be, and lately I've been wondering what the distribution might look like. To make a sales tax more progressive, you might in effect say that the first $20,000 you spend is tax-free. If you have a 10% tax, then you just give every individual $2,000 cash (and ignore that some people spend less than $20,000 – that's…

One interesting form of taxation might be to tax purely status purchases. e.g. in countries like Singapore, where you don't really need a car, they tax cars heavily -- yet rich people still go out of their way to get super expensive cars to show off. Progressive real estate taxes, luxury taxes on vehicles, expensive types of clothing or jewelry, etc. wouldn't deter purchases much, but would raise money.

The most awesome tax I have ever seen is auctioning short license plates (done in the middle east and Hong Kong) -- pure profit for the state, and artificial scarcity created by the state. In fact, it's "better" for me to own the "1" license plate if everyone knows I spent $10mm on it than if they thought I got it by being lucky.

(In general, I'd like to see more VAT + poll + etc. taxes vs. income or investment taxes. And taxes on things we want to discourage, like pollution.)

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