"Fair Share"

[Fern]

Originally posted by: eskimospy
Fern it seems like your definition of what 'progressive' means in terms of taxation is simply incorrect, much like CAD. The dollar amount of total taxes that the rich pay has absolutely nothing to do with how progressive the taxes are.

Here's the wiki article on progressive taxation. The first paragraph tells you exactly what you need to know, that whether taxes are progressive or not is based upon tax rate, not percentage of total tax revenue a group pays.

So simply because the rich are paying a greater percentage of the total tax base of the US speaks in no way to how progressive taxation is in America. Literally, that chart cannot give you that information.

If you want to show that the tax code has become more progressive in the last 8 years or whatever, you have to show the average tax rate of the top 1% in 2000, and compare it to the average tax rate of the top 1% in 2008. If they paid a higher percentage of their total income then the tax rate has become more progressive. The actual dollars paid are completely irrelevant.

I have yet to see an article that argues the tax rates of the rich have gone up under the Bush administration. If you have such an article I would like to see it. (Oh, and no... the OP doesn't say anything about that.)

Noone has ever said that tax rates went for rich under the tax cuts WTH?

But this is getting eff'in ridiculous.

You say:

So simply because the rich are paying a greater percentage of the total tax base of the US speaks in no way to how progressive taxation is in America (BTW: the only why I can see that happening is if either more than 50% of people are rich, or their tax rates are higher - your argument)

And Rainsford says:

A very simple way to prove (or disprove) their point would have been to compare percentage of total income to percentage of income tax burden.

Everybody here is arguing all kinds of different stuff. For example, you two seem to be saying the exact opposite. Then we've got wierd charts using made up number from 2015 offered as proof etc.

Lets try a different approach. Here's the 2001 tax rates:
15%, 27.5%, 30.5%, 35.5% and 39.1%

vs

2006 rates:
10%, 15%, 25%, 28%, 33%, and 35%

At the lowest bracket, there was 33% rate cut (15% vs 10%). At the highest it was only an 11% cut (39.1% vs 35%).

So, lower bracket recieved proportionally greater cuts.

A better, more thorough method would be to calculate out the taxes at varying income levels, buit I don't feel like going to that trouble.

Fern

 

[Engineer]

Originally posted by: Fern
Lets try a different approach. Here's the 2001 tax rates:
15%, 27.5%, 30.5%, 35.5% and 39.1%

vs

2006 rates:
10%, 15%, 25%, 28%, 33%, and 35%

Not exactly the same as the income levels aren't the same for the 2001 vs 2006 marginal rates and also, a there are now 6 rate levels vs 2001. Not exactly apples to apples.

And as far as the OP goes, CAD has argued that it's not about RATES so you can't bring those in here now, lol!

 

[fskimospy]

Originally posted by: Engineer

Originally posted by: Fern
Lets try a different approach. Here's the 2001 tax rates:
15%, 27.5%, 30.5%, 35.5% and 39.1%

vs

2006 rates:
10%, 15%, 25%, 28%, 33%, and 35%

Not exactly the same as the income levels aren't the same for the 2001 vs 2006 marginal rates and also, a there are now 6 rate levels vs 2001. Not exactly apples to apples.

And as far as the OP goes, CAD has argued that it's not about RATES so you can't bring those in here now, lol!

Not only that, but only looking at the income tax is really really misleading. No person trying to make a responsible and objective assessment of relative tax burden would do that because a large percentage of the income the very rich receive is through investments/capital gains/etc.

Oh and Fern you seem to have forgotten a third way that the rich could have their rates lowered and yet still pay more taxes (with less then 50% of the country being rich or their rates going up) and that's that the amount of income/wealth they came into rose sharply compared to the rest of the country. Hrmmm.

 

[Fern]

Originally posted by: Engineer

Originally posted by: Fern
Lets try a different approach. Here's the 2001 tax rates:
15%, 27.5%, 30.5%, 35.5% and 39.1%

vs

2006 rates:
10%, 15%, 25%, 28%, 33%, and 35%

Not exactly the same as the income levels aren't the same for the 2001 vs 2006 marginal rates and also, a there are now 6 rate levels vs 2001. Not exactly apples to apples.

And as far as the OP goes, CAD has argued that it's not about RATES so you can't bring those in here now, lol!

^Yeah, that's why I said the better way is to do some calcs. I started out to do it. I was gona calc the tax for the taxable amounts in the 2001 chart under both sets of rates and show the percentages. But I'm too busy with other stuff (and lazy, plus I doubt that info would change many minds.)

Everybody here is arguing all kinds of different things; it's getting silly. This will never get anywhere close to resolved. I'm giving up. I thought as a tax professional I might shed some light on some of this stuff, that was stupidy on my part. There's too many 'experts" already here. More troublesome is none of them agree with other.

Fern

 

[Bowfinger]

Originally posted by: Fern

Originally posted by: Bowfinger

Originally posted by: Fern
-snip-

You are way, way off. Please read some of the other information in this and the other thread. Also take a look at the actual data presented here.

Well, somebody's way off. But it ain't me.

Looks to me like the chart in the OP's link, and your link wildly disagree with each other.

The OP's chart says top 1% pay 40% of income taxes (at least in '06).

Your chart looks to say they pay only 22.8% (or will pay in 2015).

But uhh, why not use 2005, or 2006 etc? Why 2015?

But I do see that your chart, at least the part with actual figures (unlike the *made up* 2015 stuff) shows the top 1% paying only 18.8% of federal income tax in 2001.

If the OP's chart is to believed, the tax cuts were wildly progressive as they paid 40% of the taxes in 2006. I.e., they went from 22.8% to 40%.

Double check my math, otherwise looks like the data you linked confirms the OP's assertion (not the other way around as you would have us believe).

Fern

OK, since you won't do it for yourself, we'll do it the hard way. I'll apologize in advance to everyone else for rehashing all the same stuff that's been beaten to death in this and the other thread.

Originally posted by: Fern
No, progressive means they pay a greater share of the (combined/total) tax burden.

False, that's a specious definition of "progressive". Progressiveness is defined by rates, not total dollars. For example, Joe buys a $15K Kia and pays 10% in sales taxes. Jim buys a $150K Mercedes and pays, once again, 10% in sales taxes. They paid the same flat rate, yet Joe paid "only" $1,500 while Jim paid $15,000. Therefore, by your definition, a flat sales tax is progressive. Not.

Second example. Let's say Joe and Jim are citizens of Taxtopia. Joe pays 10% income tax on a $10,000 salary. Jim pays 0.1% income tax on his $10,000,000. Joe's rate is 100 times higher, yet he pays "only" $1,000, while Jim pays $10,000. One again, by your definition, this is a progressive tax since Jim pays more than Joe, even though Joe's rate is 100 times greater. That's absurd.

Originally posted by: Fern
Rich people cannot pay less in terms of the percentage of their income because because their marginal rate is always higher than that of lower income taxpayers.

Then, for those who have a lot of income taxed at the highest bracket (35%) their average rate of tax will be higher than any person who has less income. ...

False. You appear to be completely unfamiliar with the U.S. income tax system. The marginal rate on earned income is only one small component of one's income taxes. There are all sorts of ways to pay much, much less than that. (As to legal loopholes, "there aren't any," all I can say is I'd like some of whatever you're smoking. Some loopholes were eliminated, but nowhere close to all of them, and many new ones have risen to replace them.) The more you make, the more ways you have to pay less.

This has been explained several times and as was specifically documented with actual data in the link I provided. The wealthy do, in fact, pay at a lower average rate than the upper middle class and even much of the middle class. This is due to multiple factors including preferential treatment of capital gains income, tax shelters and loopholes, and the cap on FICA withholding. The actual, real world net effect of this (see my link) is that those reporting more than $10M per year in income in 2004 paid at an average overall rate of only 20.1%, a full half-point less than the 20.6% rate of those reporting $100K to $200K. The top 400 incomes reported paid an at average rate of only 17.5%, roughly the same as those reporting incomes of $50K to $75K per year.

This is shown in the graph I linked, and they do cite the sources of their data. For those too lazy to click, I'll even try to draw a crude substitute here:

< $30K ---------- 6.7% ---- #######
$30K-$50K ---- 14.5% ---- ###############
$50K-$75K ---- 17.4% ---- #################
$75K-$100K --- 18.9% ---- ###################
$100K-$200K -- 20.6% ---- #####################
$200K-$500K -- 21.6% ---- ######################
$500K- $1M ---- 21.6% ---- ######################
$1M -$10M ----- 22.3% ---- ######################
>$10 Mil -------- 20.1% ---- ####################
TOP 400 -------- 17.5% ---- #################

^^ Actual 2004 Data ^^


In short, as I said before, your comments were way, way off.

 

[Fern]

Originally posted by: Bowfinger

< $30K ---------- 6.7% ---- #######
$30K-$50K ---- 14.5% ---- ###############
$50K-$75K ---- 17.4% ---- #################
$75K-$100K --- 18.9% ---- ###################
$100K-$200K -- 20.6% ---- #####################
$200K-$500K -- 21.6% ---- ######################
$500K- $1M ---- 21.6% ---- ######################
$1M -$10M ----- 22.3% ---- ######################
>$10 Mil -------- 20.1% ---- ####################
TOP 400 -------- 17.5% ---- #################

^^ Actual 2004 Data ^^


In short, as I said before, your comments were way, way off.

Nope, in the over $10 Mil and top 400 you're looking at the effect of the fund manager loophole I mentioned right off.

Fern

 

[Bowfinger]

Originally posted by: Fern

Originally posted by: Bowfinger

< $30K ---------- 6.7% ---- #######
$30K-$50K ---- 14.5% ---- ###############
$50K-$75K ---- 17.4% ---- #################
$75K-$100K --- 18.9% ---- ###################
$100K-$200K -- 20.6% ---- #####################
$200K-$500K -- 21.6% ---- ######################
$500K- $1M ---- 21.6% ---- ######################
$1M -$10M ----- 22.3% ---- ######################
>$10 Mil -------- 20.1% ---- ####################
TOP 400 -------- 17.5% ---- #################

^^ Actual 2004 Data ^^


In short, as I said before, your comments were way, way off.

Nope, in the over $10 Mil and top 400 you're looking at the effect of the fund manager loophole I mentioned right off.

Fern

It's called "preferential treatment of capital gains," exactly what I already said, and it sure isn't limited to fund managers. Moreover, giving it a name doesn't somehow nullify its effect. The fact of the matter remains that very rich Americans, on the average, pay at a lower effective rate than the upper middle class and the middle class. This means our income tax system is not progressive at the top, no matter how much you and Sir Cad want to redefine the word "progressive" (as I pointed out in the other 70% of my post which you're avoiding).

The sky is green ... for sufficiently bogus definitions of green.

 

[Jhhnn]

Originally posted by: Fern

Originally posted by: Bowfinger

< $30K ---------- 6.7% ---- #######
$30K-$50K ---- 14.5% ---- ###############
$50K-$75K ---- 17.4% ---- #################
$75K-$100K --- 18.9% ---- ###################
$100K-$200K -- 20.6% ---- #####################
$200K-$500K -- 21.6% ---- ######################
$500K- $1M ---- 21.6% ---- ######################
$1M -$10M ----- 22.3% ---- ######################
>$10 Mil -------- 20.1% ---- ####################
TOP 400 -------- 17.5% ---- #################

^^ Actual 2004 Data ^^


In short, as I said before, your comments were way, way off.

Nope, in the over $10 Mil and top 400 you're looking at the effect of the fund manager loophole I mentioned right off.

Fern

Hogwash. All the people in the over $10M and top 400 categories clearly aren't hedge fund managers.

Warren Buffet isn't a hedge fund manager, but the vast majority of his income is from capital gains, taxed at 15%, which is why his personal rate is so low... and that's the same for most other top earners, as well.

 

[Fern]

Originally posted by: Jhhnn

Originally posted by: Fern

Originally posted by: Bowfinger

< $30K ---------- 6.7% ---- #######
$30K-$50K ---- 14.5% ---- ###############
$50K-$75K ---- 17.4% ---- #################
$75K-$100K --- 18.9% ---- ###################
$100K-$200K -- 20.6% ---- #####################
$200K-$500K -- 21.6% ---- ######################
$500K- $1M ---- 21.6% ---- ######################
$1M -$10M ----- 22.3% ---- ######################
>$10 Mil -------- 20.1% ---- ####################
TOP 400 -------- 17.5% ---- #################

^^ Actual 2004 Data ^^


In short, as I said before, your comments were way, way off.

Nope, in the over $10 Mil and top 400 you're looking at the effect of the fund manager loophole I mentioned right off.

Fern

Hogwash. All the people in the over $10M and top 400 categories clearly aren't hedge fund managers.

Warren Buffet isn't a hedge fund manager, but the vast majority of his income is from capital gains, taxed at 15%, which is why his personal rate is so low... and that's the same for most other top earners, as well.

Try again. I didn't say that they all were. I said the effect of those who are factor in. Some fund managers make +$100 mil, doesn't take many to exert a measurable effect.

As far as the many rich getting taxed at cap gains rate - that IS the fund manager loophole. Their income income is taxed at cap gain rates instead of ordinary rates.

As to whether non-fund manager rich types have a low average rate because of investments taxed at LT cap gains, that will vary significantly from year-to-year.

Look at the market value now, when would you have had to buy in to get a big cap gains? 10 or more years ago?

Remember inflation too. A lot of cap gain income ain't income at all when inflation is factored in.

Fern

 

[CADsortaGUY]

So since those who earn over 10mill pay less effective rate(still not what the OP was about...not that it matters around here I guess) it isn't progressive? Is BHO only going to raise taxes on those over 10 mill? How do you suppose he'll do that? No matter what he does won't affect this "problem" due to those at the bottom of those "brackets"(no matter where you put them) pay a higher effective rate than those at the top of the same "bracket".

 

[Jhhnn]

Nice dance, Fern. The fact remains, as Bowfinger points out, that the federal tax rate is regressive at the top, with the top 400 paying basically the same rate as those making $50-75K. There's no way to say for sure that it's due to the hedge fund manager effect, as you propose, simply because the source of those huge incomes is confidential IRS information... You're making attributions for which there is no evidence.

And it's not like lean times affect the wealthy the same way that middle or lower income families are affected- those at the top have huge assets, resources that can be liquidated as required to support their lifestyles should they choose to do so. That can't be said for the vast majority of middle earners, at all...

 

[CADsortaGUY]

Originally posted by: RightIsWrong

Originally posted by: CADsortaGUY

Originally posted by: RightIsWrong

Originally posted by: CADsortaGUY

Originally posted by: Engineer

Originally posted by: CADsortaGUY

Again, this isn't about rate. Try again.

OK CAD. Someone pointed out in this thread that you would just repeat the dodge until people wore down and quit and they were right. You can define progressive however you want but you know the damn truth and won't admit it. The tax code is not more progressive, period and evidence has been given to support that.

No, look at the OP. It's not about rates. So while you and others try to make it about other things - I'm trying to stick with what was presented.

You may not want to accept a broad view of "progressive" and stick to a narrow "rate" view if you wish but it doesn't change anything.

But what was presented was a fallacy. You and the author in the OP are trying to make the claim that the rich are worse off because their contribution is more without allotting for the fact that their take is even bigger than that.

You are essentially trying to say that even though that make 25% more than they did previously, they are paying 10% more so they are burdened. It is either lunacy, willful ignorance or stupidity that you can't see that.

No where did anyone claim the rich were "worse off".

..next lame attempt...

From your first post (the OP):

Seems our system is MORE "progressive" after Bush's taxcuts. The bottom 50% make 12% of the income yet only pay 3% of the taxes. I'm not sure how BHO can really lessen the "burden" when there isn't much of one to begin with.

So someone can have a bigger burden but not be worse off in your opinion?

Typical liberal BS. When you have the bottom 50% paying 3% but making 12% you can come to no other conclusion that it is progressive and since the numbers have changed to lessen the "burden" on the bottom 50%(and the income share increased). But I know it's got to be difficult for you diehards to accept reality and I fully expected you to come in here whining about the numbers.

First and foremost, you are the one whining about the numbers. The whole premise of the thread was the author's and your whining about how the rich have to pay such a high progressive tax. Whaaaaa!

Secondly, you once again are complaining that the poor are getting off easier.

There are 2 different "progressive" measures and I'm addressing the one here that we see trotted out by the libs all the time - that the rich aren't paying their "fair share". It's total BS - they are paying more and more of the tax share. The libs here don't seem to want to accept that so they switch to the "effective" or "rate" whining per usual. It's just the same as when we talk about the other things, they whine about "fair share". I'm simply addressing what the data shows, others seem to be trying to bringing other arguments into it.

Here you are complaining once again that the libs don't see that the poor, poor rich folk are having to pay more than they used to without any acknowledgment that they are bringing in even more than what their increase in output is. What is the name of that kind of rational again? Oh, yeah...cognitive dissonance.

No, you are WAY off base. notice the "burden" in ""'s? It doesn't take a genius to see that it wasn't MY stance that it's a "burden".
My complaint is not about the rich being taxed too much - I've stated that already - I think they should stay right where they are right now. Unfortunately you libs want to raise taxes because you "feel" the rich don't pay enough. Also, I have NEVER complained that the poor don't pay enough - you are just flat out lying. The only thing remotely close to that is my "net zero" stance but that's a different subject and not about them "getting off easier".


Also it seems you, bowfinger, and others still only want to use a very narrow view of progressivity as it suits your agenda.

 

[CADsortaGUY]

Originally posted by: Jhhnn
Nice dance, Fern. The fact remains, as Bowfinger points out, that the federal tax rate is regressive at the top, with the top 400 paying basically the same rate as those making $50-75K. There's no way to say for sure that it's due to the hedge fund manager effect, as you propose, simply because the source of those huge incomes is confidential IRS information... You're making attributions for which there is no evidence.

And it's not like lean times affect the wealthy the same way that middle or lower income families are affected- those at the top have huge assets, resources that can be liquidated as required to support their lifestyles should they choose to do so. That can't be said for the vast majority of middle earners, at all...

Why won't you people address the "regressive" nature of our bracket system?

Hmm... could it be because it doesn't have to do with class envy? Hmmm....

 

[BoberFett]

Originally posted by: Bowfinger

Originally posted by: Fern

Originally posted by: Bowfinger

< $30K ---------- 6.7% ---- #######
$30K-$50K ---- 14.5% ---- ###############
$50K-$75K ---- 17.4% ---- #################
$75K-$100K --- 18.9% ---- ###################
$100K-$200K -- 20.6% ---- #####################
$200K-$500K -- 21.6% ---- ######################
$500K- $1M ---- 21.6% ---- ######################
$1M -$10M ----- 22.3% ---- ######################
>$10 Mil -------- 20.1% ---- ####################
TOP 400 -------- 17.5% ---- #################

^^ Actual 2004 Data ^^


In short, as I said before, your comments were way, way off.

Nope, in the over $10 Mil and top 400 you're looking at the effect of the fund manager loophole I mentioned right off.

Fern

It's called "preferential treatment of capital gains," exactly what I already said, and it sure isn't limited to fund managers. Moreover, giving it a name doesn't somehow nullify its effect. The fact of the matter remains that very rich Americans, on the average, pay at a lower effective rate than the upper middle class and the middle class. This means our income tax system is not progressive at the top, no matter how much you and Sir Cad want to redefine the word "progressive" (as I pointed out in the other 70% of my post which you're avoiding).

The sky is green ... for sufficiently bogus definitions of green.

Which is why we'd be better off with a true flat tax sans deductions and applicable to all income regardless of source. Too bad Democrats chafe at the notion of a flat tax because they can't fathom anything other than a highly progressive scale, even though you've just shown it to be ineffective anyway.

 

[Bowfinger]

Originally posted by: CADsortaGUY
[ ... ]
Also it seems you, bowfinger, and others still only want to use a very narrow view of progressivity as it suits your agenda.

I know, we're stubborn that way. We want to use the actual definition instead of your made-up one. Damn us anyway.

The sky is green ... for sufficiently "broad" definitions of green.

 

[Bowfinger]

Originally posted by: CADsortaGUY
Why won't you people address the "regressive" nature of our bracket system? ....

Because it's not my week to chase goofy diversions. Next week's not looking good either. Sorry.

 

[Bowfinger]

Originally posted by: BoberFett
Which is why we'd be better off with a true flat tax sans deductions and applicable to all income regardless of source. Too bad Democrats chafe at the notion of a flat tax because they can't fathom anything other than a highly progressive scale, even though you've just shown it to be ineffective anyway.

That would certainly move us back to a more level system at the top. Unfortunately, it would also shift a huge portion of taxes back to the poor and the middle class, people who are already struggling to make ends meet. I would suggest, however, that simply taxing capital gains at the same rate as earned income would help tremendously.

 

[CADsortaGUY]

Originally posted by: Bowfinger

Originally posted by: CADsortaGUY
Why won't you people address the "regressive" nature of our bracket system? ....

Because it's not my week to chase goofy diversions. Next week's not looking good either. Sorry.

Right, anything you don't want to address/admit to is a "goofy diversion". Oh well, stick to your narrowminded views of "progressive" then.

 

[Bowfinger]

Originally posted by: CADsortaGUY
[ ... ]
Oh well, stick to your narrowminded views of "progressive" then.

Kiss off Cad. I already presented two examples of how your definition of "progressive" is absurd, as have a couple of others. I note you haven't had the courage to try to address them. Show us you can actually provide on-topic responses instead of continually trying to change the subject as you get backed into another corner.

 

[CADsortaGUY]

Originally posted by: Bowfinger

Originally posted by: CADsortaGUY
[ ... ]
Oh well, stick to your narrowminded views of "progressive" then.

Kiss off Cad. I already presented two examples of how your definition of "progressive" is absurd, as have a couple of others. I note you haven't had the courage to try to address them. Show us you can actually provide on-topic responses instead of continually trying to change the subject as you get backed into another corner.

You and others have not bee on-topic yet you seem to think that I need to address your crap? Why don't your read up on "progressive" - it's not just about rates. Then come back here and address the topic of this thread instead of diverting it with the usual liberal BS.

 

[Bowfinger]

Originally posted by: CADsortaGUY

Originally posted by: Bowfinger

Originally posted by: CADsortaGUY
[ ... ]
Oh well, stick to your narrowminded views of "progressive" then.

Kiss off Cad. I already presented two examples of how your definition of "progressive" is absurd, as have a couple of others. I note you haven't had the courage to try to address them. Show us you can actually provide on-topic responses instead of continually trying to change the subject as you get backed into another corner.

You and others have not bee on-topic yet you seem to think that I need to address your crap? Why don't your read up on "progressive" - it's not just about rates. Then come back here and address the topic of this thread instead of diverting it with the usual liberal BS.

I have addressed your OP, both explicitly and implicitly when I've shown exactly why your attempted redefinition of "progressive" is absurd. You steadfastly refuse to address the counterpoints presented in those responses, instead bleating the same snake oil from the OP over and over and whining about how we won't let you change the English language.

I've already provided one of my implicit responses. Let me also cut and paste one of my explicit responses, for you to dodge again:

"I fully understand how you want to frame the discussion, because that's the only way your disinformation sells. The fact remains that the richest Americans pay proportionately less in taxes than the upper middle class and much of the middle class. Indeed, the actual data shows America's highest-paid, the elite 400, pay essentially the same rate as a modestly middle class family earning $50K-$75K per year. People in the $100K to $200K bracket pay at a higher rate than those making more than $10M per year. These rates exclude sales taxes, highly regressive, and are based on taxable income as reported to the IRS, i.e., income left after deductions and exclusions like tax shelters. This means this data understates the actual tax gap between the upper middle class and the very wealthy.

"That's the true picture, whether you're willing to acknowledge it or not."

 

[BoberFett]

Originally posted by: Bowfinger

Originally posted by: BoberFett
Which is why we'd be better off with a true flat tax sans deductions and applicable to all income regardless of source. Too bad Democrats chafe at the notion of a flat tax because they can't fathom anything other than a highly progressive scale, even though you've just shown it to be ineffective anyway.

That would certainly move us back to a more level system at the top. Unfortunately, it would also shift a huge portion of taxes back to the poor and the middle class, people who are already struggling to make ends meet. I would suggest, however, that simply taxing capital gains at the same rate as earned income would help tremendously.

We have to face facts though. Our current tax code is incredibly complex and is designed to contain shelters and loopholes. Since the wealthy are the ones who write the laws and thus create the loopholes, the only way to make sure they're paying their fair share is to simplify our tax system. Any complication in taxation will result in them paying less, not more.

I could see a personal deduction, where every filing adult and their dependent counts as a single, simple deduction. Beyond that, everything is taxed at a flat rate. Simple.

 

[Jhhnn]

Originally posted by: CADsortaGUY

Originally posted by: Jhhnn
Nice dance, Fern. The fact remains, as Bowfinger points out, that the federal tax rate is regressive at the top, with the top 400 paying basically the same rate as those making $50-75K. There's no way to say for sure that it's due to the hedge fund manager effect, as you propose, simply because the source of those huge incomes is confidential IRS information... You're making attributions for which there is no evidence.

And it's not like lean times affect the wealthy the same way that middle or lower income families are affected- those at the top have huge assets, resources that can be liquidated as required to support their lifestyles should they choose to do so. That can't be said for the vast majority of middle earners, at all...

Why won't you people address the "regressive" nature of our bracket system?

Hmm... could it be because it doesn't have to do with class envy? Hmmm....

It's been addressed, repeatedly. The taxable income bracket system itself is progressive, but not all income falls into the normal definition of taxable income- capital gains are taxed at a flat 15%, regardless of income level. Brackets and capital gains have nothing to do with each other.

Bowfinger points out how other kinds of AGI alterations like tax shelters further distort the picture, understating top incomes significantly, raising the apparent tax rate for those at the top...

As for your charge of "narrow minded definition of progressive", I figure you'd use a broad minded definition of night as day, if it suited your purposes, piss down our collective leg while claiming that it's raining, too- pretty much the thrust of the WSJ piece in your OP and your ongoing efforts in general.

If you're not being paid to post your usual disinformative drivel, then you should be, because you're actually pretty good at it....

 

[First]

Originally posted by: BoberFett

Originally posted by: Bowfinger

Originally posted by: BoberFett
Which is why we'd be better off with a true flat tax sans deductions and applicable to all income regardless of source. Too bad Democrats chafe at the notion of a flat tax because they can't fathom anything other than a highly progressive scale, even though you've just shown it to be ineffective anyway.

That would certainly move us back to a more level system at the top. Unfortunately, it would also shift a huge portion of taxes back to the poor and the middle class, people who are already struggling to make ends meet. I would suggest, however, that simply taxing capital gains at the same rate as earned income would help tremendously.

We have to face facts though. Our current tax code is incredibly complex and is designed to contain shelters and loopholes. Since the wealthy are the ones who write the laws and thus create the loopholes, the only way to make sure they're paying their fair share is to simplify our tax system. Any complication in taxation will result in them paying less, not more.

I could see a personal deduction, where every filing adult and their dependent counts as a single, simple deduction. Beyond that, everything is taxed at a flat rate. Simple.

The negative implications of a flat tax are broad and would sharply reduce U.S. output while also further increasing the gap between the wealthy and the poor, since a flat tax would require a larger overall increase in everyone's tax rate to make up for lost gov't revenue as a result of not being able to tax the rich at a higher rate. A flat tax is a vastly over-simplified way to "fix" the tax code, as it t completely ignores investment incentives, which apply to everyone, including the middle class, not just the rich. One simple and obvious example is that owning property (a house, for example) is tax-deductible, and with nothing but a flat tax you'd have less incentive to own property. This applies to businesses too, with the consequences here being far more devastating to economy-wide output than residences. The implications of a deduction-less world are endless, and nowhere near good for anyone, rich, middle class, or poor.

 

[RightIsWrong]

Originally posted by: CADsortaGUY
So since those who earn over 10mill pay less effective rate(still not what the OP was about...not that it matters around here I guess) it isn't progressive? Is BHO only going to raise taxes on those over 10 mill? How do you suppose he'll do that? No matter what he does won't affect this "problem" due to those at the bottom of those "brackets"(no matter where you put them) pay a higher effective rate than those at the top of the same "bracket".

You finally are getting it!!!

Progressive, in terms of taxation means that you are paying a higher PERCENTAGE...not dollar amount. Why is this so hard for you and Fern to grasp? No matter how many times you two try to pound the square into the round hole...it just isn't going to fit.

BHO's proposal is to raise the EFFECTIVE rate on the upper bracket and cut it on the lower. Now that is a progressive tax.