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Your real tax rate: 40%

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Re: Your real tax rate: 40%

#161
post #124

Earlier quoted context omitted.

To be fair, in the few cases where I've seen good data, most groups do better in the US than in their native countries. For instance, Asian Americans have average income of $65,000. Japan, the richest country in Asia, has average income of about $40,000. Japanese Americans also live 2 years longer than Japanese. Swedish Americans are also considerably richer than Swedes, as I discovered today: http://super-economy.bl…

Yeah, but that's a self-selected group. People who are capable of moving their families to another country to pursue a career are more likely to be successful. Similarly people who grow up in poor, backwards communities (trailer parks and projects, meth and crack), tend to wind up poor and backwards. Maybe I'm a reactionary liberal but I have an easier time believing that than the inherent genetic superiority of the…

When's the last time you flew coast to coast? There's quite a lot of farmland in the U.S.

Re: Your real tax rate: 40%

#162

Earlier quoted context omitted.

I think the fact that a job wouldn't be done in a free market system is not a justification for saying that they don't contribute on net. The free market doesn't lend itself to funding a lot of work that is still worth doing - basic research being an obvious example.

I'm not sure that's the case, since I'm not sure if government-funded research was more of an effect or a cause of the decline of privately-funded research.

I can think of quite a few technologies that are the unforeseen side-effect of some government funded research, and would have probably never occurred otherwise. For example MRI, the Web, and the Internet. I would imagine quite a bit of research on green technologies and so on have also mostly been government funded until recently.

Companies mostly fund research that brings immediate results. Sure, some (like IBM) may be looking further down the line, and some probably just subsidise some research as PR. But areas where there is no clear advantage and in addition carry a large risk, are mostly shunned by corporations.

Re: Your real tax rate: 40%

#163
post #161
post #124

Earlier quoted context omitted.

Yeah, but that's a self-selected group. People who are capable of moving their families to another country to pursue a career are more likely to be successful. Similarly people who grow up in poor, backwards communities (trailer parks and projects, meth and crack), tend to wind up poor and backwards. Maybe I'm a reactionary liberal but I have an easier time believing that than the inherent genetic superiority of the…

When's the last time you flew coast to coast? There's quite a lot of farmland in the U.S.

There is indeed a lot of farmland in the US, but there's also more suburban wasteland than the entire land mass of Denmark (made up figure).

Denmark manages to have a higher population density than us while still being like 90% farmland. That's efficiency.

Re: Your real tax rate: 40%

#164
post #109
post #38

Earlier quoted context omitted.

You could always try the military... you've got one hell of an expensive lean, mean fighting machine there. I'm pretty sure it would still be as good for defence at a fraction of the cost.

Be careful with that. Warfighting is every bit as complex, technical and dynamic a discipline as computers. Maybe more so. Do you have a developed opinion on ballistic defense, our nuclear posture, our relative emphasis on COIN vs. conventional warfare? No? Then you are in the position of an executive eying the expensive IT department with a foggy notion that it could get the job done for half the cost, without a cle…

There is a huge gap between the US and the second best military in the world. After a 15% cut in DoD budget we would still maintain that #1, so the real question is how much of a lead do we need to feel safe? Must we be able to crush #2 - 5 at the same time?

Re: Your real tax rate: 40%

#165

Earlier quoted context omitted.

As a side note, one interesting difference between owning equities from a company that you started versus that you purchased from savings is that your work invested into the company is NOT taxed. If you can create $100k of value a year in your own company or earn a salary of $100k (which after taxes nets you only $60k that you can contribute to purchasing assets), it will take you a lot longer to build up the value o…

Your work is not normally taxed; your income is. If your company is worth something, it's based on some kind of future earnings. And those future earnings are taxed.

Consider two developers that make 100k per year before taxes and live off of 40k / year. Now assuming they work for each other they pay 100k and get 65k after taxes, spend 40k and get to invest 15k which they spend on advertizing for their company.

Now assume the work for themselves They pay they only need to live off of 40k so they pay themselves 70k and get to invest 30k on advertizing without paying taxes on that value. Note: numbers are not accurate but they do give context. The idea, is companies can invest in future earns though things like advertizing or R&D without paying taxes on the income uses to pay for that advertizing.

Now you are supposed to pay yourselves market rate, but if you generate 300k in value each year you don't need to pay yourself that money.

Re: Your real tax rate: 40%

#166
post #49

Earlier quoted context omitted.

Citation, please.

http://en.wikipedia.org/wiki/List_of_United_States_federal_a... If you can find even a single agency on that list which performs a function you wouldn't be willing to pay for, the rest of my comment follows for you, specifically: that agency is a net cost to you comprising both the taxes you pay to fund it (proportionately) and the decrease in wealth caused by keeping those people from contributing to the economy by…

Not beneficial to me personally does not mean "people ... who don't actually contribute anything to society on net", and it would take more research than I have time for to completely dismiss any US federal agency (except perhaps the DOD).

Re: Your real tax rate: 40%

#167
post #164
post #109

Earlier quoted context omitted.

Be careful with that. Warfighting is every bit as complex, technical and dynamic a discipline as computers. Maybe more so. Do you have a developed opinion on ballistic defense, our nuclear posture, our relative emphasis on COIN vs. conventional warfare? No? Then you are in the position of an executive eying the expensive IT department with a foggy notion that it could get the job done for half the cost, without a cle…

There is a huge gap between the US and the second best military in the world. After a 15% cut in DoD budget we would still maintain that #1, so the real question is how much of a lead do we need to feel safe? Must we be able to crush #2 - 5 at the same time?

Well, it's not a horse race. It's not a question of being able to beat the other guy, but of capability. It's not about who you can beat, but what you can do. (Though the amusing answer to your last question is yes -- for many recent years, the direction was that the military needed to be at a level to prosecute two overseas wars while maintaining homeland defense).

One of the QDR review panels talked about current issues in defense. It's not authoritative direction, but it does give a taste of how the military is about more than just competing with the next peer. Here's what they had to say about its goals:

  1. America has for most of the last century pursued 
  four enduring security interests:

    a. The defense of the American homeland

    b. Assured access to the sea, air, space, and 
    cyberspace

    c. The preservation of a favorable balance of power 
    across Eurasia that prevents authoritarian domination 
    of that region

    d. Providing for the global ―common good through 
    such actions as humanitarian aid, development 
    assistance, and disaster relief.


  2. Five key global trends face the nation as it seeks 
  to sustain its role as the leader of an international 
  system that protects the interests outlined above:

    a. Radical Islamist extremism and the threat of 
    terrorism

    b. The rise of new global great powers in Asia

    c. Continued struggle for power in the Persian Gulf 
    and the greater Middle East

    d. An accelerating global competition for resources

    e. Persistent problems from failed and failing states.


  3. These five key global trends have framed a range of  
  choices for the United States:

    a. These trends are likely to place an increased 
    demand on American "hard power" to preserve regional 
    balances; while diplomacy and development have 
    important roles to play, the world‘s first-order 
    concerns will continue to be security concerns.

    b. The various tools of "smart power" – diplomacy, 
    engagement, trade, targeted communications about 
    American ideals and intentions, development of 
    grassroots political and economic institutions – 
    will be increasingly necessary to protect America‘s 
    national interests.

    c. Today‘s world offers unique opportunities for 
    international cooperation, but the United States needs 
    to guide continued adaptation of existing international 
    institutions and alliances and to support development of 
    new institutions appropriate to the demands of the 21st 
    century. This will not happen without global confidence 
    in American leadership, its political, economic, and 
    military strength, and steadfast national purpose.

    d. Finally, America cannot abandon a leadership role in 
    support of its national interests. To do so will simply 
    lead to an increasingly unstable and unfriendly global 
    climate and eventually to conflicts America cannot 
    ignore, which we must then prosecute with limited 
    choices under unfavorable circumstances -- and with 
    stakes that are higher than anyone would like.
It's not a question of just saying, "Do the same job with less." The military we have exists to do certain jobs and there are a lot of very smart people interested in doing those jobs very efficiently. No, if you want a cheaper military, you need to do less. You need to start picking goals to give up. If you really wanted to pare the military down to just homeland defense, you probably could do that job with a lot less, but you wouldn't be able to render humanitarian aid or make the world a safer place for everyone (us included).

Here's another example of a policy goal not directly related to homeland defense or beating someone else's military (This from the Nuclear Posture report):

    Toward a World Free of Nuclear Weapons

    The long-term goal of U.S. policy is the complete 
    elimination of nuclear weapons. At this point,
    it is not clear when this goal can be achieved. 
    Pursuing these NPR recommendations will strengthen 
    the security of the United States and its allies and 
    partners and bring us significant steps closer to 
    the President’s vision of a world without nuclear 
    weapons.

    The conditions that would ultimately permit the 
    United States and others to give up their nuclear
    weapons without risking greater international 
    instability and insecurity are very demanding. 
    Among those are the resolution of regional disputes 
    that can motivate rival states to acquire and 
    maintain nuclear weapons, success in halting the    
    proliferation of nuclear weapons, much greater 
    transparency into the programs and capabilities of 
    key countries of concern, verification methods 
    and technologies capable of detecting violations of 
    disarmament obligations, and enforcement measures 
    strong and credible enough to deter such violations. 
    Clearly, such conditions do not exist today. But we 
    can – and must – work actively to create those 
    conditions.
Applying effort toward achieving those goals may require a larger or smarter (more expensive) military. We do it, not because we want to beat China, but because it's something we want to do and think is worth the cost.

Re: Your real tax rate: 40%

#168
post #127

Earlier quoted context omitted.

To put it simply: if you earn a dollar more of income, about forty percent of that dollar will end up going to the government.

Or, in other words, in a 5 day week, Monday and Tuesday you work for the government. Wednesday through Friday is for yourself.

No, that's not right, because the dollars you are already earning might not be taxed at the marginal rate.

Re: Your real tax rate: 40%

#169
post #25
post #21

Earlier quoted context omitted.

I believe he's talking about compliance with income tax regulations on the non-governmental side. Accountants, tax prep, etc.

I pay 120$ a year for someone else to do my taxes, I make ~80k per year. So add 1/6 of 1% so we are now up to 1/2 of 1%. Anyway, there is going to be a cost to administering any tax so while simplifying things may save money it's never going to zero. PS: I could see a simplified tax code saving people 20 billion a year, but good luck implementing that. Edit: For example, CC transaction fees cost more than current tra…

Ever run a business, have a rental property, etc? Any of that will push your tax prep past 120 a year, for personal taxes alone.

Re: Your real tax rate: 40%

#170
post #165

Earlier quoted context omitted.

Your work is not normally taxed; your income is. If your company is worth something, it's based on some kind of future earnings. And those future earnings are taxed.

Consider two developers that make 100k per year before taxes and live off of 40k / year. Now assuming they work for each other they pay 100k and get 65k after taxes, spend 40k and get to invest 15k which they spend on advertizing for their company. Now assume the work for themselves They pay they only need to live off of 40k so they pay themselves 70k and get to invest 30k on advertizing without paying taxes on that…

Right, if you invest that money, you will only realize the value through dividends or selling a stake. And the value of that stake is once again based on the NPV of future cash flows, which are taxed.
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