Home

As you know, fairness is a concept that was invented so that children and idiots could participate in arguments. I was reminded of this when thinking about taxes. According to one source, the people in the top 1% of incomes pay more federal taxes now than at any time since 1979:


http://www.factcheck.org/askfactcheck/what_percent_of_taxes_does_the_top.html


The reason the top 1% are paying more taxes is because they are earning far more money than before. So while the rich are paying a lower percentage than during Clinton's time in office, they are paying more in dollars under Bush.


In other words, each rich person is subsidizing more poor people than ever. Still, each rich person has more left over for himself than ever. If you are on the side that says that isn't fair, what percent of a rich person's income do you think should be distributed by threat of force to those in need?


50%?


75%?


90%?


Keep in mind that a person making ten million a year can get by on one million a year. So is there any good reason not to take 90%? Think about all the people it would help.

 
Rank Up Rank Down Votes:  +12
  • Print
  • Share
  • Share:

Comments

Sort By:
+3 Rank Up Rank Down
Jul 9, 2008
I love the content filter. It flagged c i r c u m s t a n c e s in my last post. I never knew I was swearing so much.
 
 
0 Rank Up Rank Down
Jul 9, 2008
The purpose of the tax code is not to penalize the rich, but to pay for the costs of running the country. The rich are in a better position to pay.

I would argue for a flat tax large enough to pay for all required expenses, adjusted annually (no deficit spending except in exceptional !$%*!$%*!$%*!$% Then give each person a rebate equivalent to the taxes on an income equal to some multiple of the poverty rate, maybe 2 or 3x.

If you want to keep the current !$%*!$ system, then capping the highest tax rate at 50% would still leave plenty of incentive to earn more and finance the expenses of the country. We are never going to have system that is totally fair, but if it needs to be slighty unfair at least the rich can afford it.
 
 
+1 Rank Up Rank Down
Jul 9, 2008
Is there any good reason not to take 90%? Well it wouldn't be the country I'd want to live in if I was a high-performing CEO. Besides that, it wouldn't be fair for people who work 80 hours a week for their money. So here's my idea: high tax rates for the super-wealthy, but only for the money they make in the first 40 hours of the week. Over the money they make in the other hours, they pay a very low tax rate. That way, the ones that can afford it pay more to society, while working hard is stimulated.

If you like the idea: consider that you take it from someone that can't even fill in his own tax forms.
 
 
Jul 9, 2008
Firstly: Scott, I'm a big fan on your work (the blog, the comic, the books). I may not agree with everything (or most things) that you write here, but I still enjoy reading them.

The idea of this has many problems. What constitutes being super-rich? Who decides? I remember hearing about a survey (I don't remember who made it), but it essentially interviewed people at all different income brackets about what it would take to be "rich". Almost everyone thought that if they only made a little bit more they'd be rich. People who made $100,000/yr thought that they'd be rich if they made $150,000/yr. People who made $150,000/yr thought they'd be rich if they made $200,000/yr and so on.

Personally, I don't think anything should be taken to "help" other people by threat of force. That's why charities exist. So people can donate their money willingly to help people. If someone comes and takes money out of my wallet to help Johnny Less Affluent down the street, I'm not going to be Johnny's biggest fan. In fact, I'm going to wonder why the government things that Johnny is more deserving of my money than me, the person who worked for it. Those with means shouldn't be punished because of it.

Oh, and mouffett: I'm a good little Republican. But I don't own a Persian rug, I don't sit around sipping wine, I don't belong to a yacht club. I'm a college student from a lower-middle-class family. Do me a favor and try not to stereotype in the future, okay?
 
 
Jul 9, 2008
But why stop at 90%? How about we just keep taxing the rich until they are making the same amount as the average American? I say this with a completely sarcastic tone of voice. Taxing the rich at 90% will still be deemed unfair because that hypothetical person is still making a million a year while most of the country is not. To be fair the country would have to tax everyone until they made the national average each year. But to do that in a reasonable way the government would have to tax 100% and then refund whatever they deem the national average to be.

You have to see that the people making $10 million a year are doing something that may be slightly more difficult than the average American job. Therefor, if everyone is going to be paid the same amount of money by the government why should that millionaire even put the extra effort in? Because he/she loves the job? That is ridiculous. The average American resents people in high level jobs. Why would anyone aspire to a high level job if they are going to be hated and make the same amount of money as if they just sat around watching the grass grow?

Also look at how it would change the economy. With nobody investing money (because it has all gone to the government) there would be no economic growth.

The argument for taxing at higher and higher rates essentially becomes an argument for Communism. While it all sounds nice there is one major flaw. People that are motivated to actually do things with their lives go to other countries to do them in order to receive credit for their accomplishments. Do we want the country where people come to from all over the world to become one from which people are always trying to escape?
 
 
Jul 9, 2008
One of the biggest lies of libertarianism is that unrestricted capitalism will distribute rewards who produce the most wealth. The most obvious contradiction of this is in sweat shops, where the workers keep a mere fraction of the wealth they produce. But what's even crazier is that in fields such as entertainment, a major singer can actually earn MORE wealth than they produce. If, for example, Stacy Ferguson had never been born, we'd be listening to a singer that was 99.6% as talented. Stacy's income is certainly greater than .4% of the sales she generates.

http://en.wikipedia.org/wiki/Superstar#Economics_of_.22Superstars.22
 
 
+7 Rank Up Rank Down
Jul 9, 2008
I'll be the first to admit that I don't know anywhere near enough to argue a real position on this, but logic seems to dictate to me that if everyone paid the same percentage in taxes (regardless of income) we could easily find a way to generate just as much money for the government as we do now, without placing an undue burden on the poor OR an unfair tax on the rich.

and there would be a lot less BS to squabble about...
 
 
Jul 9, 2008
Obviously there are multiple reasons this will never happen, but the question is what percentage I would take away, so I'll stay in la-la-land and assume it will.
My percentage wont be flat for the top 1%. I
I would take the top 1% by weath. (say that's 10 people for simplicity)
The start at the bottom of the list, and take away as much money from the last guy as possible that still keeps his rank at #10, but not more than, say $100
Then move up to #9.
Rinse and Repeat.




 
 
-1 Rank Up Rank Down
Jul 9, 2008
I presume from the last sentence Scott that you are not one of the few who earns $10 million plus each year. otherwise you wouldn't even ask if the government should grab even more of your money. If you want the Government to do anything you should ask them why they do not close down all the offshore tax loopholes, that people/companies use the money then raised should then allow for a tax cut for current tax payers. Or you could get greater voluntary contribution in running state programes thus reducing waste.
In addition to this where do you think Mr Bin Laden and the drug barons hide all their money then ,under their beds?
I also like the newspeak use of the word fair for more Government and higher taxes.
 
 
Jul 9, 2008
On the one hand, luck is the single most determinant of success. Some people work two, maybe two and a half times as hard as average, but that's not enough to explain the income disparity. In some countries, people work 10 hours a day, every day and earn $500 a year.

On the other hand, people are driven by incentives, and you can't mandate people love each other. The more we tax and subsidize, the less efficiant our economy will operate. The more you try and reslice the wealth pie, the smaller the pie gets.

So no, the rich do not "deserve" their wealth. But it would be counter-productive to take to much of it away.

(Incidently, I saw a poll that says the more people think the government should help the poor, the less likely they are to give to private charity. My grandfather has earned millions, but he gave most of it away.)
 
 
+7 Rank Up Rank Down
Jul 9, 2008
For me the most compelling argument for not super-taxing the rich is that the rich spread their money more efficiently than the goverment, at least eventually.

They spend a fair amount of the money as they get it buying goods and services. The rest they save, which pays fees to the investment industry and usually grow it more efficiently than any government could even dream about.

Eventually, their income dimishes and they spend their savings or they die and their children/grandchildren spend their savings.

The rich are also often entrepeneurs. Taxing them at a modest rate encourages them to invest in risky business ideas and try to make them work to generate even more obscene amounts of money. This activity also benefits lots of people and communities.

Virtually all of this activity is also taxed as it takes place.

In the long run the rich will be net savers in a good economy and will be net spenders in a poor ecomony. Not a bad thing for stabilising the swings out.

Governments on the other hand do almost nothing constructive and redistrubute the money incredibly inefficiently. Roughly like getting the fattest kid in school to hand out the pies :)
 
 
Jul 9, 2008
Curse you, Scott Adams, for making me think in ways I don't want to think. I don't want to think about how much money rich people "get to" keep, or how it compares to what they make. I want to think about how much they HAVE, and how much it could help. Like a good little Democrat.

(Before all you good little Republicans start high-fiving each other, don't forget that the guys who wove your Persian rug or picked the grapes for that fine 2001 !$%*!$%*!$ you're sipping are sleeping 6 to a room in the neighborhood you pass on your way to the yacht club....)
 
 
Jul 9, 2008
shirtbloke just stole my thunder--what is the incentive for the top 1% to live under those conditions?--they will just go elsewhere where they can continue to live how they please---the more money they make, the more it helps everyone
 
 
+8 Rank Up Rank Down
Jul 9, 2008
The underlying assumption is the more money the government takes the more people will be helped. Given the track record any presidential administration in the last 90 years has, I don't have much faith that it will get to the people who need it.

To answer your question directly, I'd say less than 50%. And to make sure the money gets into the right hands, I'd like to suggest a program where every dollar given to charitable purposes during the year could be a direct tax writeoff up to 90% of an individual's annual owed tax total. It promotes smaller government and provides for the genuinely needy in a variety of areas.

If a government raises taxes too high, as another reader pointed out, the rich people will move or use tax havens. I'm thinking St. Kitts and Nevis sounds pretty nice.
 
 
Jul 9, 2008
A greater portion of your tax money goes to defense than it does to subsidize the poor, which makes sense because you have more to lose (economically) if your country is invaded or overthrown. If you feel that you need to invest 90% of your income to protect the other 10%, then it seems like a wise investment. What's the point of being filthy rich when you might wake up one day to find that the Dutch have taken over and seized all your hard-hoarded loot?
 
 
Jul 9, 2008
Not many people are earning that kind of money through actual salaries, some do, but not many. Most of the really rich people earn it through investments. They take the money they earn and invest more. If you take their money away and give it to poor people, they don't have as much money to invest, so what they invested in will suffer. Capital markets will dry up, as investment spending decreases. Consumer confidence will decline as the stock market declines. Businesses won't be able to get the money they require to expand and the economy will stagnate, which will result in a higher rate of unemployment. Then there will be even more poor people that need to be subsidized. And at high tax levels there is no individual incentive for someone to work hard (socialism.) So productivity would decrease as taxes increased. Bad idea.
 
 
Jul 9, 2008
In the 1960s, here in the UK we actually had a top rate of tax of about 90%. Remeber John Lennon, Ringo Starr etc living in the US? That's why. Everybody with the money either moved abroad or started using tax havens. And the economy collapsed.
 
 
 
Get the new Dilbert app!
Old Dilbert Blog