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People who make $250,000 or more a year can afford a tax hike.

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Re: People who make $250,000 or more a year can afford a tax hike.

#91

Post by elsewhen »

rbranson wrote: post #13

I make what I consider a middle class salary (around double the household income in my area), and I'm pretty sure I can afford a tax hike. While I would not be terribly happy about it, it's not going to hurt me. I'd say for most of the real middle class, who haven't mortgaged themselves to the hilt, a tax hike of a few percent will cut into their discretionary income, not anything truly needed. I'll have to wait anot…

is affordability really the unit-of-analysis that you want to use to design (or make tweaks to) a tax system?

lets assume that $50k per year gives a comfortable lifestyle to a person. anyone earning less than 50k per year cant afford to pay taxes and therefore doesnt have to. anyone earning more than 50k can certainly afford it, so they pay the amount needed to get there income to 50k. so a guy who makes 60k pays 10k per year, and a guy who earns 1MM pays 950k.

do you think entrepreneurs would start businesses in this environment? sure, some would because they are doing what they love... but what about all those boring businesses. do you think the dry cleaner LOVES to wash other people's clothes? do you think the guy who started 1-800-GOT-JUNK loves other people's trash?

among other things, you need to think about incentives (and the killing of those incentives) when you devise a tax system.

Re: People who make $250,000 or more a year can afford a tax hike.

#92

Post by ryanwaggoner »

jfager wrote: post #89
ryanwaggoner wrote: post #85

Earlier quoted context omitted.

Are you seriously arguing that millions of people should be taxed more on the basis of what one person may have done?

Are you seriously suggesting only one person has gotten wealthy without contributing to society?

No, but you seem to be arguing for a broader trend or application of the principle on an anecdote related to one person (and a pretty flimsy anecdote at that). Show me some data.

Re: People who make $250,000 or more a year can afford a tax hike.

#93

Post by modoc »

maximilian wrote: post #21
modoc wrote: post #3

Earlier quoted context omitted.

I'm right there on that line. Honestly I pay a TON of taxes already. Very high rate, lots of taxable income. Cutting back to be under 250k would probably make more sense than making 255k and paying a lot more in taxes. I don't mind taxes and social programs. I do mind paying for unending wars in the Middle East (not making a political statement, just a budgetary one). Cut some of the crazy expenses, and I'll be happi…

If you make $255K, you only get a higher tax rate on the extra $5K. You'll still have more money than someone making $249K. No matter how you slice it, more money = more money. The gov't just will tax you a bit extra on the 5K.

That makes sense, sorry, I wasn't keeping in mind the progressive bracket system:(

Re: People who make $250,000 or more a year can afford a tax hike.

#94

Post by modoc »

Eliezer wrote: post #11
modoc wrote: post #3

Earlier quoted context omitted.

I'm right there on that line. Honestly I pay a TON of taxes already. Very high rate, lots of taxable income. Cutting back to be under 250k would probably make more sense than making 255k and paying a lot more in taxes. I don't mind taxes and social programs. I do mind paying for unending wars in the Middle East (not making a political statement, just a budgetary one). Cut some of the crazy expenses, and I'll be happi…

> Cutting back to be under 250k would probably make more sense than making 255k and paying a lot more What kind of job do you have that makes >$250K and doesn't require you to understand how income taxes work? I'm skeptical.

My bad. I was confused. Actually I have my companies accountants handle all the taxes, so I don't have to keep much awareness of how income taxes work. I probably should, but I don't need to, since I pay them to do it:)

Re: People who make $250,000 or more a year can afford a tax hike.

#95

Post by michaelcampbell »

rbranson wrote: post #70
ryanwaggoner wrote: post #62

Earlier quoted context omitted.

Yes, and they're already paying much, much more than the less successful by virtue of the fact that they make more. But by taxing at a higher rate because they have more money, you're effectively punishing them for success. It'd be a like a VC demanding that if you exit at $10m, you owe them $3m, but if you exit at $1b, you owe them $500m.

You aren't punishing them for success. For a whole lot of reasons, the fact of the matter is, the value of individual units of money (one dollar) DECREASES non-linearly as your personal supply increases. When you were making $50k/yr, you'd probably be quite careful with how you allocated $500, because it represented a sizable chunk of your time. Now that you make $5m/yr, $500 is literally worth to you what $5 was whe…

And a non progressive tax rate does exactly that.

> You aren't punishing them for success.

Simply saying that doesn't make it so. If you make more and are more successful you are taxed at a higher rate. This is the very definition of being punished for being successful.

> For a whole lot of reasons, the fact of the matter is, the value of individual units of money (one dollar) DECREASES non-linearly as your personal supply increases.

Can you list some? How is the $10 I pay in taxes that gets allocated to some department of the government any more or less than the $10 that someone else has paid, at a different tax rate? It might be non-linear to the PAYER, but that's irrelevant; it's exactly the same to the PAYEE.

Whether or not someone can /afford/ a higher tax rate based on income is irrelevant and stems from an emotional argument, not a fiscal or economic one. And a sour grapes, juvenile "IT'S NOT FAIR!", wealth-redistribution based one at that. My 9 year old has these sorts of ideas.

Re: People who make $250,000 or more a year can afford a tax hike.

#96

Post by michaelcampbell »

javaru wrote: post #14
ryanwaggoner wrote: post #6

Of course they can "afford" it. But so what? Every single billionaire can "afford" to be taxed at a 99% rate. The bigger question: is it in any way fair, just, or moral to tax society's most successful more heavily just for being more successful? EDIT: The other salient question that I forgot to mention is: "why do we need more taxes?" Our government already can't manage what they have with any sort of reasonable eff…

I would say that the society's most successful are often the ones benefiting the most from the law and order provided by government. If the highway, mail, law enforcement, and judicial systems, for example, didn't work as well, it would be much harder to create a successful business.

> I would say that the society's most successful are often the ones benefiting the most from the law and order provided by government.

Even if that were so, (any citations there? The assertion is almost laughable.), it's not what the argument being made is saying. The argument is being made that these institutions are somehow providing MORE value to the successful, so the more successful owe more for their use.

Which is simply not true. If a clever, successful person is somehow making more or better use of these tax-funded services, that's the side effect of him being clever or successful, not that the service has provided him some sort of hidden value that the less successful cannot take part of, and for which the successful person "owes" more because of.

Re: People who make $250,000 or more a year can afford a tax hike.

#98

Post by j_baker »

ryanwaggoner wrote: post #6

Of course they can "afford" it. But so what? Every single billionaire can "afford" to be taxed at a 99% rate. The bigger question: is it in any way fair, just, or moral to tax society's most successful more heavily just for being more successful? EDIT: The other salient question that I forgot to mention is: "why do we need more taxes?" Our government already can't manage what they have with any sort of reasonable eff…

"The bigger question: is it in any way fair, just, or moral to tax society's most successful more heavily just for being more successful?"

No, it's not. However, it is fair to tax the people who have the most. Determining your income for the year is just a heuristic, and an inaccurate one at that. However, if you can come up with a 100% fair way to determine whether a person deserves their income based on a tax form, I'd suggest running for Congress or the Presidency.

But until that happens, we're just going to have to settle for an imperfect system. Personally, I like the idea that if anyone is treated unfairly by our tax system, it's the top 3%. I think our tax system is fair to the other 97%. And that's quite an accomplishment.

Re: People who make $250,000 or more a year can afford a tax hike.

#99

Post by d2viant »

gnosis wrote: post #78
ryanwaggoner wrote: post #6

Of course they can "afford" it. But so what? Every single billionaire can "afford" to be taxed at a 99% rate. The bigger question: is it in any way fair, just, or moral to tax society's most successful more heavily just for being more successful? EDIT: The other salient question that I forgot to mention is: "why do we need more taxes?" Our government already can't manage what they have with any sort of reasonable eff…

"Every single billionaire can "afford" to be taxed at a 99% rate." And they should be taxed at a 99% rate, if not higher. Leave them with a million dollars, tops. That's fair.

...and what will that accomplish?

Re: People who make $250,000 or more a year can afford a tax hike.

#100

Post by grandalf »

gnosis wrote: post #80
grandalf wrote: post #23

Most people in the US pay no taxes at all. The $250K threshold hits lots of hard working professionals and entrepreneurs who are by no means "rich" and who work extremely hard. I'd argue that people earning $250K who are paying off loans and working 60+ hour weeks cannot afford it... and that taxing them is a horrible policy idea, no matter how well it resonates with voters who themselves pay no taxes (or people like…

"Most people in the US pay no taxes at all. The $250K threshold hits lots of hard working professionals and entrepreneurs who are by no means "rich" and who work extremely hard." Let's see now... when the median family income in the US is $40,000 per year, an individual making $250,000 per year is undoubtedly rich. They might not be super rich, or even very rich. But they're rich.

Also, a family (two adults, 2 children) earning $40K per year will pay next to nothing in taxes. This is why such people tend to support our oil wars, they are costless to them. Both political parties like to keep it this way.
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