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A Minimum Tax for the Wealthy

nytimes.com

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Re: A Minimum Tax for the Wealthy

#101

Post by brg »

forensic wrote: post #20
nugget wrote: post #3

Government is the least efficient allocator of resources. For every dollar put to use, many more dollars are wasted due to incompetence or fraud. California's Proposition 30 was a wake-up call for me; despite all the political advertisements to the contrary, the many billions raised for "education" went entirely to shore up the teacher's bloated pensions and benefits fund. Entrepreneurs are some of the most efficient…

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.

Re: A Minimum Tax for the Wealthy

#102

Post by gwright »

dkarl wrote: post #86
gwright wrote: post #48

Earlier quoted context omitted.

Why are you framing the argument as if incomes are something that are owned by the government instead of the person who earned the money? The notion that taxation should be predicated on whether the government or the person can 'better use' the person's money is damn scary.

The notion that taxation should be predicated on whether the government or the person can 'better use' the person's money is damn scary. Why is it scary? Your tax dollars go to the government because other citizens wish their tax dollars to go to the government, because they believe the government is the most efficient way to provide certain goods. Basically, they believe the government can spend their money better t…

Taxes are entirely not consensual. And that is the crux of the matter. Because they are not consensual there needs to be some sort of mechanism to limit the ability for the majority to simply appropriate money and property from the minority.

Suggesting that the only limiting factor is whether the government (even a democratically elected one) thinks it can use the money better than you can, really isn't a limit.

When the people find that they can vote themselves money, that will herald the end of the republic. -- Benjamin Franklin

Re: A Minimum Tax for the Wealthy

#103

Post by gwright »

hackinthebochs wrote: post #85
gwright wrote: post #59

Earlier quoted context omitted.

I'm guessing your not a big John Locke fan.

I am a fan actually, and I don't think my views are incompatible with his. I do have reservations of the typical use of "natural law" arguments though. One can construct a natural law argument for just about any premise one wants.

> I am a fan actually, and I don't think my views are incompatible with his.

I'm unable to reconcile your comment with what I understand to be John Lock's theory regarding property rights. They seem incompatible to me.

Re: A Minimum Tax for the Wealthy

#104

Post by rdl »

skibob1027 wrote: post #8
ballstothewalls wrote: post #4

Earlier quoted context omitted.

Government is the least efficient allocator of resources? Says who? How many wealthy individuals are sitting on piles of money right now because they are unsure of the economic climate and therefore are not going to invest? Who better than the government to take it away from them and then invest it into public infrastructure and consequently stimulate the economy?

Wealthy people don't "sit on piles of money". That money is either held in a bank or invested. If it's in a bank, it is able to be loaned out to others looking for access to capital now. If its invested, it's being used as capital in a business (assuming it's and equity investment).

Banks don't really loan out money these days, either -- they generally have been keeping it on deposit with the fed, or in government securities, rather than making commercial loans.

And, banks are a lot less efficient at deploying capital than enterprises internally, or private investors, even in good times.

Re: A Minimum Tax for the Wealthy

#105

Post by ianb »

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 the sort of loophole that can never grow very large).

Given a system like that I'd be curious what the numbers might really look like. How high a tax would we need? What would the actual tax burden look like for different amounts of cash-back? Could we replicate something similar to the progressivity we have now?

But there's still distortions. Consider high Shipping & Handling fees – these are often done because S&H is considered a service, and so sales tax is not levied on that portion of the cost. But a $0.01 book with $7 S&H is clearly bullshit. But who is there to call the seller on that bullshit? Why are goods taxed but not services? I've never been clear on that.

Re: A Minimum Tax for the Wealthy

#106

Post by rdl »

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.

The big deal is that AMT doesn't apply to capital gains (at least not directly; it can cause you to blow the exemption cap though)

Re: A Minimum Tax for the Wealthy

#107

Post by arn »

mhartl wrote: post #90
arn wrote: post #57

Earlier quoted context omitted.

This is an absurd (yet common) response. And if you are for a war, why don't you buy a gun and go fight?

A more apt analogy would be, if you're for a war, why don't you enlist? But lots of people in favor of wars do just that. What Buffett is saying is essentially, "Let's institute a draft." Lots of wars have had that, too, of course—which is not necessarily a good thing.

Sure, I'll accept that. But it's a dismissive argument that (purposefully) misses the point.

a: "I want the administration to increase funding for NASA"

b: "Shut up! Send them money yourself!"

Re: A Minimum Tax for the Wealthy

#108

Post by rdl »

owyn wrote: post #96
w3pm wrote: post #77

Earlier quoted context omitted.

Agreed. Mr. Buffet is free to donate as much of his 'tail wind' wealth as he chooses. But please, hands off of my wallet.

He donated all of it. Whatever you got isn't that interesting. You know, I've never had a problem with the income taxes that I pay. They're taken out of my check and I work with what's left. I never think "oh man, they're taking my money" any more than I think "oh man, I totally deserve to win the lottery". I do think there's something about earning money through investments that makes paying taxes "feel" more like y…

The main reasons capital gains are taxed at a lower rate are:

1) inflation (if you buy a stock for $100 and sell it 10y later for $120, you actually lost money, at least for every 10y period I know about)

2) invested dollars have a higher multiplier for economic activity than wages earned and then spent, so raising capital gains rates hurt the economy more ("have higher deadweight losses") than wage taxes. Poll taxes and consumption (VAT, particularly) taxes are even better, though.

3) people who have enough money to make meaningful investments tend to vote more reliably than people who earn mainly wage income, and also are in a better position to donate to political campaigns.

Re: A Minimum Tax for the Wealthy

#109

Post by nugget »

chasing wrote: post #31
nugget wrote: post #3

Government is the least efficient allocator of resources. For every dollar put to use, many more dollars are wasted due to incompetence or fraud. California's Proposition 30 was a wake-up call for me; despite all the political advertisements to the contrary, the many billions raised for "education" went entirely to shore up the teacher's bloated pensions and benefits fund. Entrepreneurs are some of the most efficient…

"Entrepreneurs are some of the most efficient allocators, because they are decision makers with a vested interest in the outcome. This concept is so rare as to practically not exist in the public sector." What a shitty, smug attitude to have towards the many very bright and motivated people who work in the public sector. They're not all perfect, but neither are all entrepreneurs. Not by a long shot.

I didn't say that folks in the public sector are lazy or stupid, I said that there is rarely a direct connection between their performance on the job and their financial upside. Public sector workers are much more concerned about downside protection (i.e. avoid controversial decisions, cover your ass). In many cases, and I've seen this first hand, inaction is safer than action, whereas the opposite is usually true in business and especially in startups.

Re: A Minimum Tax for the Wealthy

#110

Post by r00fus »

a5seo wrote: post #69
r00fus wrote: post #44

Earlier quoted context omitted.

> With the threshold at $250k, the tax hikes would still only bring in enough added revenue to cover 8 days of federal spending. Does that include the restoration of pre-Bush capital gains tax? Because I'm sure that would add up to a lot. In fact, I think that's the biggest thing that the ultra-rich have become addicted to in the past decade.

not precisely what you asked, but a useful approximation: "If the IRS grabbed 100 percent of income over $1 million, the take would be just $616 billion. That’s only a third of this year’s deficit." [2012] -- http://www.forbes.com/sites/danbigman/2012/04/03/john-stosse...

That's exactly not what I was saying - I was talking about capital gains which isn't taxed as income. Currently that sits at 15%, but will rise to 25%.
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