A graphical assault on supply-side tax cuts

[fskimospy]

There's noting needing a rebuttal. Smith wasn't saying that's the ideal form of government. He was saying that's a corrupt form of government.

I'll also point out, as to the question being asked or if that was some 'central point' - according to taxation rules Smith actually did lay out, plenty of rich people would be due a tax cut, and plenty at the bottom would be paying a lot more taxes, if going by Smith's guidelines about what is a 'fair share'.

Those arguing about that age old 'fair share' are foolish to use Smith as a source, if socking it to the rich is their goal. Smith didn't even like income taxes.

He was talking about civil government as it exists when created for the purposes of the defense of property, which basically all modern governments are. It doesn't matter if he had an idealized government that was different, it was his evaluation of governments with similar aims to ours. It's not really foolish to talk about him in relation to taxation either, as he was clearly in favor of progressive taxation, just based on different criteria.

It's also kind of an obvious statement. I mean the protection of personal property is quite clearly one of the primary aims of our government. Who cares about that? The people with the most property. All that aside Smith could not possibly have imagined the sort of society we live in today, so saying what he thought would be the appropriate burden today is kind of a waste of time.

 

[Hugo Drax]

Why is it something so obviously wrong is so extremely difficult to rail against in government?

Because Government has been captured and do what the Lobbyist tells them to do.

 

[Hugo Drax]

Yeh, just quit paying the rent & the utility bill. Quit buying food & clothes for the kids. Quit buying gas & car insurance. Quit going to the doctor & the dentist. Embrace the simplicity of homelessness.

All you have to do is stop perpetually leasing cars, buying new cars every 3-4 years, buying new TV sets every 3 years, buying your kids 900 dollar phones with internet, becoming house poor by buying the biggest zero lot McMansion you can find etc..


Malls are packed with people borrowing money like drunken sailors buying cheap Chinese stuff as entertainment.

Americans can go back to the spending habits of the average 1958 American.

 

[fskimospy]

All you have to do is stop perpetually leasing cars, buying new cars every 3-4 years, buying new TV sets every 3 years, buying your kids 900 dollar phones with internet, becoming house poor by buying the biggest zero lot McMansion you can find etc..

Malls are packed with people borrowing money like drunken sailors buying cheap Chinese stuff as entertainment.

Americans can go back to the spending habits of the average 1958 American.

Say that again?

 

[Jhhnn]

Because Government has been captured and do what the Lobbyist tells them to do.

So instead of recapturing the govt the people should just tear it down, eliminate that buffer between us & the lootocracy.

Cuz reasons.

 

[Jhhnn]

All you have to do is stop perpetually leasing cars, buying new cars every 3-4 years, buying new TV sets every 3 years, buying your kids 900 dollar phones with internet, becoming house poor by buying the biggest zero lot McMansion you can find etc..


Malls are packed with people borrowing money like drunken sailors buying cheap Chinese stuff as entertainment.

Americans can go back to the spending habits of the average 1958 American.

I reference reality. You merely reference right wing bullshit about America's spending habits.

Still gotta do the stuff I mentioned regardless of your attempts at duh-version.

 

[Zaap]

OK....how about this one? 😉



Adam Smith, Wealth of Nations, Book V, Chapter II, Article I: Taxes upon the Rent of House

And in large part, they do. Despite all the myths to the contrary.


And how about his VERY FIRST cannon on taxation? 😉

I. The subjects of every state ought to contribute towards the support of the government, as nearly as possible, in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the state.

Okay so...

Hint: the top are doing this. The middle is arguable. The bottom 40%...

... got NO business quoting Adam Smith on taxation from any sort of high horse position. 😛

 

[fskimospy]

And in large part, they do. Despite all the myths to the contrary.


And how about his VERY FIRST cannon on taxation? 😉

I. The subjects of every state ought to contribute towards the support of the government, as nearly as possible, in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the state.

Okay so...

Hint: the top are doing this. The middle is arguable. The bottom 40%...

... got NO business quoting Adam Smith on taxation from any sort of high horse position. 😛

Hint: if you're going to look into what people pay to support the government you need to look at ALL the money they pay to support the government. That means sales taxes, licensing fees, income taxes, payroll taxes, DMV fees, etc. US FEDERAL taxes are pretty progressive. State and local taxes are highly regressive for the most part though, which leads to this:

All of a sudden the picture looks a LOT different, huh? Does this change your mind at all?

 

[Zaap]

I see you missed where that said ALL Federal taxes- payroll, corporate etc.

Sales taxes- LOL, way to shift goal posts.

In what universe would it really make sense to expect that 1% of people would pay a huge lion's share of sales taxes? You must be one that thinks that all wealthy people do things like go into a store and say to themselves, "Well, I'm wealthy, so I'll buy 20x what I need, because I want to pay my fair share of sales taxes!"

Even accounting for the wealthy buying more luxury items, and more expensive items, by the obvious fact of sheer percentage of population, there's nothing you're ever going to do to get it where 1% or 10% or whatever small percent would pay a lion's share of something like a sales tax.


(DMV fees is a particularly hilarious example! It OF COURSE makes sense that a tiny fraction percent of people would register and pay for the majority of the nation's automobiles! LOL!)

So of course it doesn't surprise me at all that you're shifting the goal posts- you and your ilk always do when it's pointed out that the rich aren't really skating away free of paying taxes like you always make out, and that the bottom 50% really should keep their mouths shut about "fair share" of taxes because of the bargain they're actually getting.

By the way- in a roundabout way, you did illustrate the folly of a consumption tax attempting to replace income taxes. The charts of who pays what after such was ever implemented would be pretty eye opening indeed!

 

[ElFenix]

And in large part, they do. Despite all the myths to the contrary.

actually, they don't. go find that chart for taxes paid v. wealth held, since that's the discussion.

hint: the top 20% there are paying 68%. the top 20% hold nearly 88% of wealth. the top 1% are paying 24%, but hold 37% of wealth.

they're skimping on their premiums. (and yes, i know, the comparison isn't going to be full on accurate because someone could be in the top 1% of income earners but not in the top 1% of wealth holders. but that's not going to shift the distribution that much.)

edit: lol at you talking about moving the goalposts after subbing income for wealth.

and it gets even worse if you include taxes other than federal. and yes, they should be included, as they pay for society too.

 

[fskimospy]

I see you missed where that said ALL Federal taxes- payroll, corporate etc.

Sales taxes- LOL, way to shift goal posts.

In what universe would it really make sense to expect that 1% of people would pay a huge lion's share of sales taxes? You must be one that thinks that all wealthy people do things like go into a store and say to themselves, "Well, I'm wealthy, so I'll buy 20x what I need, because I want to pay my fair share of sales taxes!"

Even accounting for the wealthy buying more luxury items, and more expensive items, by the obvious fact of sheer percentage of population, there's nothing you're ever going to do to get it where 1% or 10% or whatever small percent would pay a lion's share of something like a sales tax.


(DMV fees is a particularly hilarious example! It OF COURSE makes sense that a tiny fraction percent of people would register and pay for the majority of the nation's automobiles! LOL!)

So of course it doesn't surprise me at all that you're shifting the goal posts- you and your ilk always do when it's pointed out that the rich aren't really skating away free of paying taxes like you always make out, and that the bottom 50% really should keep their mouths shut about "fair share" of taxes because of the bargain they're actually getting.

By the way- in a roundabout way, you did illustrate the folly of a consumption tax attempting to replace income taxes. The charts of who pays what after such was ever implemented would be pretty eye opening indeed!

First of all, ElFenix is right on that Smith was talking about wealth instead of income and so by that standard the rich are probably nowhere close to paying their fair share.

Secondly you'll definitely have to explain to me why a dollar paid in income taxes matters but a dollar paid in sales taxes doesn't. Are income tax dollars special? I can't speak for you, but I seem to be a dollar poorer no matter which one I pay.

I like how pointing out blatantly obvious mistakes you have made is 'shifting the goal posts' though. lol. You got duped by the standard conservative line about taxes that only looks at federal income taxes. Better luck next time!

 

[Zaap]

First of all, ElFenix is right on that Smith was talking about wealth instead of income and so by that standard the rich are probably nowhere close to paying their fair share.

Secondly you'll definitely have to explain to me why a dollar paid in income taxes matters but a dollar paid in sales taxes doesn't. Are income tax dollars special? I can't speak for you, but I seem to be a dollar poorer no matter which one I pay.

I like how pointing out blatantly obvious mistakes you have made is 'shifting the goal posts' though. lol. You got duped by the standard conservative line about taxes that only looks at federal income taxes. Better luck next time!

This is why you're the spinmeister!

Explain to me in what universe it would make sense that 1 rich person vs. 99 other people would pay a percentage of sales taxes anywhere near equal to those 99 people?

On what planet would the DMV charge that 1 person more for registering their car (even cars) vs 99 other people registering thiers?

You guys when proven 100% wrong about what's actually taxed, ALWAYS fall back on crowing on about things that aren't, with that phony 'the wealth' argument.

Much of what you include as 'the wealth' to get it where you can finally say the wealthy aren't paying a 'fair share' is of course tons of things that aren't taxed- because they aren't realized as taxable gains!

You also always leave out the fact that if you were going to start taxing everything that a blanket like 'wealth' covers, you'd sock it to the poor and absolutely KILL the middle class.

But as we've actually seen with you in the whole "tax poor people out of their homes in order for wealthy people to buy them" threat that we recently had, you'd actually be all in favor of that.

 

[fskimospy]

This is why you're the spinmeister!

Explain to me in what universe it would make sense that 1 rich person vs. 99 other people would pay a percentage of sales taxes anywhere near equal to those 99 people?

On what planet would the DMV charge that 1 person more for registering their car (even cars) vs 99 other people registering thiers?

You guys when proven 100% wrong about what's actually taxed, ALWAYS fall back on crowing on about things that aren't, with that phony 'the wealth' argument.

Much of what you include as 'the wealth' to get it where you can finally say the wealthy aren't paying a 'fair share' is of course tons of things that aren't taxed- because they aren't realized as taxable gains!

You also always leave out the fact that if you were going to start taxing everything that a blanket like 'wealth' covers, you'd sock it to the poor and absolutely KILL the middle class.

But as we've actually seen with you in the whole "tax poor people out of their homes in order for wealthy people to buy them" threat that we recently had, you'd actually be all in favor of that.

Lol, you're flailing now. If anyone is trying to spin it's the guy who is desperately trying to declare that only some taxes count.

I couldn't care less what you think rich people should do as far as sales taxes are concerned. It's up to you to tell me why you think a dollar in income taxes should count as money you are paying towards society but a dollar in sales taxes shouldn't. This is in fact a super easy question to answer. When you want to look towards what people are paying towards government you simply look at all the dollars they give to government.

You have inadvertently stumbled on exactly my point though. When everyone pays exactly the same amount to register their car, the poor are paying a MUCH higher proportion of their income for it. So while rich people pay a higher federal rate, poor people often pay a higher state and local rate. You want to ignore one and not the other because you're too proud to admit you said something dumb.

 

[thraashman]

Esquire asked men at 4 different income levels about the lives they can afford
I thought this was pretty relevant to this conversation. Especially how if you look at the question all 4 were asked "Do you think your taxes are too high?". The two men in the higher income brackets, and thus the higher tax brackets, both said they don't think their taxes are too high. The men in the lower brackets both said yes their taxes are too high. And it's obvious why. If you make more, that higher percentage still affects your life in a much smaller way than the person who makes less but pays a lower percentage.

 

[Zaap]

That's your spin that anyone said it shouldn't.

You're the one purposefully conflating a 'fair share' tax argument with forms of taxation that a 'fair share' of has nothing to do with income, and everything to do with percentage of population!

Did your income determine what you paid to register your car?

Do store owners ask you your income before they calculate your personal percentage of sales tax burden?

Now answer honestly, spin-meister. 😛

 

[fskimospy]

That's your spin that anyone said it shouldn't.

You're the one purposefully conflating a 'fair share' tax argument with forms of taxation that a 'fair share' of has nothing to do with income, and everything to do with percentage of population!

Did your income determine what you paid to register your car?

Do store owners ask you your income before they calculate your personal percentage of sales tax burden?

Now answer honestly, spin-meister. 😛

It has nothing to do with the share of the population, genius. My chart was by income percentile and percent of national income, meaning it is normalized by population size. That's what percentages and percentiles do. The important part is the share of national wealth for each group and the share of taxes that group pays. They are close to even for most groups. Therefore your idea that a group of people is paying more than their fair share is directly contradicted by the data.

So spin meister, apologize at your leisure. Hahaha. It is amusing that you keep trying to accuse people of 'spin' when you either are totally clueless about what you're reading or are trying to engage in deliberate deception yourself.

 

[fskimospy]

Your basic argument seems to be that because there are more poor people than rich people that taxes which impose a flat fee will by their very nature will disproportionately be paid by the poor.

My answer to that would be: who gives a shit. The question is how much money is earned vs how much is paid in taxes in total. The type of tax is 100% irrelevant.

 

[Zaap]

It has everything to do with percentage of population, silly!

You're never going to have small fractions of the population paying taxes not based on income (the very examples YOU pointed out... being wrong about payroll taxes of course...) that will be wildly disproportionate to their percentage of population.

You're rallying call that 1% of people aren't somehow magically paying a huge disproportion of DMV fees (!!!) is so silly its barely worth addressing. Conflating obvious mathematical certainties like that with a 'fair share based on income' argument, as well as lumping in not taxing non-realized holdings is just part and parcel of your shifting goal posts.

If you have a problem with the states that charge sales taxes being more regressive toward the poor... what exactly are you in favor of to correct this? Actually try to make income part of sales tax collection? Should the DMV and every other govt entity charge more based on income? How would that work?

Its telling how whenever you're shown to be dead wrong about federal taxes.. you always always always mix in the states! If you think state taxes are too high and unfairly target the poor... by all means... work to get rid of them. Are you?

 

[Jaskalas]

Later this afternoon, I’ll be testifying before the Joint Economic Committee, where the star Republican witness is my old friend Art Laffer. Art is widely known as one of the main brains behind “supply-side” tax cuts: the idea that if you cut taxes on labor and capital, the extra economic activity you’d engender would make up some share of the lost revenue. The fabled “Laffer curve” plots this theoretical trade-off.

Whoa. Isn't that also the premise behind stimulus? And instead of wishing for Wall Street to see value in extra labor, stimulus would be a more direct approach to achieve said results.

Those charts are also interesting... moreover, I'd say the economy these past 40 years has been obviously stacked against the American worker. Labor is being crushed, wages don't even come close to the cost of living. People are in serious pain.

No... your message isn't even necessary. Just get rid of the paywall behind "Inequality For All" by Robert Reich and this economic argument ends that same day. Before Youtube shut it down, that video was the single most influential and impactful political economic argument ever made. You cannot talk economics in America without first referencing that video. It sets up the foundation for anything you'd like to say next.

If it has been Reaganomics prevailing during our downfall these past 40 years... then it is Reaganomics that needs to burn. Yes?

 

[fskimospy]

It has everything to do with percentage of population, silly!

You're never going to have small fractions of the population paying taxes not based on income (the very examples YOU pointed out... being wrong about payroll taxes of course...) that will be wildly disproportionate to their percentage of population.

You're rallying call that 1% of people aren't somehow magically paying a huge disproportion of DMV fees (!!!) is so silly its barely worth addressing. Conflating obvious mathematical certainties like that with a 'fair share based on income' argument, as well as lumping in not taxing non-realized holdings is just part and parcel of your shifting goal posts.

You're the guy who tried to plant the goal posts outside the stadium and then got mad when people told you that's not how the game works.

I'm not sure how to make this any clearer to you but I'll try again:

1. The chart I linked showed % of total taxes paid vs. % of national income. In a perfectly 'fair' system those two bars would be exactly even for every group of people. They are pretty close. The number of people in the group doesn't matter, as you're looking at relative shares.

2. It doesn't matter where those taxes come from. If you paid them in DMV fees, income taxes, etc, that's irrelevant. The only thing that matters is $ in income vs. $ in taxes. That's how you determine if someone is paying too much or too little, right?

3. You appear to understand that when someone pays a higher percentage of their income in income tax that this represents a greater burden to them. The exact same principle applies in reverse for flat fees. If person A makes $1000 a year and person B makes $10,000 a year then a $100 registration fee represents a tax of 10% of their income to person A and 1% of their income to person B. Why do you understand %->$ but not $->%? It's the same equation.

4. So in the end what you get is a progressive federal system and a regressive state system that balance out so all groups pay a percentage of taxes roughly equal to their share of national income. I personally think this is a terrible idea, but from your position you should be happy about how 'fair' it is. Instead you seem to want to advantage rich people still further based on only looking at one tax and not others. This is illogical. You have to look at ALL taxes.

If you have a problem with the states that charge sales taxes being more regressive toward the poor... what exactly are you in favor of to correct this? Actually try to make income part of sales tax collection? Should the DMV and every other govt entity charge more based on income? How would that work?

Its telling how whenever you're shown to be dead wrong about federal taxes.. you always always always mix in the states! If you think state taxes are too high and unfairly target the poor... by all means... work to get rid of them. Are you?

Can you show me a time I've been 'shown to be dead wrong about federal taxes'? I'm under the impression that someone's tax burden is all of the taxes they pay. Apparently you think differently. If you don't, then stop trying to say that some groups pay substantially more than their fair share.

As for what to do about it, the answer is pretty simple. We should institute a national flat consumption tax with a large prebate. That way you get progressive taxation still.

 

[Zaap]

In an argument about funding the nation at a national level, its fair to talk federal taxes. Most people citing all the rich not paying a fair share noise think its at the federal level. Conflating state taxes in this is disengenous, because they vary wildly across all 50.


The idea that a flat consumption tax would make taxation more fair than an income tax... how?

You really think there's a scenario where you're getting more consumption taxes out of 3,000,000 people vs. 297,000,000 people?

 

[fskimospy]

In an argument about funding the nation at a national level, its fair to talk federal taxes. Most people citing all the rich not paying a fair share noise think its at the federal level. Conflating state taxes in this is disengenous, because they vary wildly across all 50.

So in other words you think it is deceptive to count all money used to fund the nation in a discussion about funding the nation. I'm quite sure that people saying the rich aren't paying their fair share don't give a shit about what level it's paid at.

The idea that a flat consumption tax would make taxation more fair than an income tax... how?

You really think there's a scenario where you're getting more consumption taxes out of 3,000,000 people vs. 297,000,000 people?

How 'fair' it is depends entirely on your idea of what fair is, and the prebate can be modified to whatever level you feel like to achieve the desired level of progressivity. The idea is better because it is more economically efficient, not because it is more or less fair.

As for how many people we are getting revenues from, that depends entirely on what dollar amount you put the prebate at.

 

[ElFenix]

In an argument about funding the nation at a national level, its fair to talk federal taxes. Most people citing all the rich not paying a fair share noise think its at the federal level. Conflating state taxes in this is disengenous, because they vary wildly across all 50.


The idea that a flat consumption tax would make taxation more fair than an income tax... how?

You really think there's a scenario where you're getting more consumption taxes out of 3,000,000 people vs. 297,000,000 people?

state government is still government. the fact that we've decided to split sovereigns in our system doesn't mean those functions relegated to the states aren't necessary parts of a civil government. so why wouldn't you count the taxes that actually fund those services (as the states can't print money those actually are your tax dollars at work)?

Whoa. Isn't that also the premise behind stimulus?

no, different mechanisms at work. stimulus is about getting back to full employment when you have a non-pareto efficient economy due to demand shortfalls (i.e. if everyone is cutting trying to save, spending falls, which means income falls so there's less income to save from). so, it's stimulating demand by inserting massive government spending to drive incomes up. also there's multiplier effects, so, $1 spent creates more than $1 in economic activity as that dollar makes its way through the economy.

laffer curve basically starts with this premise: at 0% tax rate on the economy, the government collects no taxes. at 100% tax rate on the economy, no one works, so the government collects no taxes. somewhere in the middle there's an optimal tax rate that maximizes the amount of taxes collected. so, if you're above that optimal rate, you can cut the rate to raise more taxes.

at least, that was the original theory back in the 80s. most republicans at the time knew it was a crock of shit ("voodoo economics" was coined by george hw bush in the 1980 presidential election while he was running against reagan). but with the price of oil dropping (by half from its 1980 peak to 1985, and then half again by the next year) and the boomers coming into prime earning years, the 80s boomed despite reagan's voodoo economics.

 

[Jhhnn]

In an argument about funding the nation at a national level, its fair to talk federal taxes. Most people citing all the rich not paying a fair share noise think its at the federal level. Conflating state taxes in this is disengenous, because they vary wildly across all 50.


The idea that a flat consumption tax would make taxation more fair than an income tax... how?

You really think there's a scenario where you're getting more consumption taxes out of 3,000,000 people vs. 297,000,000 people?

Taxes are taxes. They all cut into the bottom line just the same & they all go to support govt at some level or another.

Of course consumption taxes affect the wealthy in insignificant ways. That's why their income taxes need to be higher, to spread the tax burden as a % of income more evenly.

 

[Zaap]

state government is still government. the fact that we've decided to split sovereigns in our system doesn't mean those functions relegated to the states aren't necessary parts of a civil government. so why wouldn't you count the taxes that actually fund those services (as the states can't print money those actually are your tax dollars at work)?

Show me where the rich are purposefully not paying state taxes as part of this whole dastardly 'not paying their fair share!' meme.

Its obvious as the nose on your face why a tiny percentage of a states population wouldn't be paying the lions share of a sales tax or other fees not based on income. They'll pay more closer to thier much smaller percentage of the population... a fact your argument exploits purposefully even though there's nothing nafarious about this.

Please do show me though where the rich pay less state income taxes in the states that have them than others... a true 'fair share' argument. I'd like to see it.