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A Tax-Cut Analogy

Discussion in 'BBS Hangout' started by RichRocket, Jun 4, 2001.

  1. RichRocket

    RichRocket Member

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    WHO PAYS FOR WHAT?

    This is a rebuttal fabricated after reading an editorial railing against "Tax Cuts for the Rich". By the way, the ratios are roughly accurate: 10% of the taxpayers pay about 60% of the taxes collected 30% pay 37%, and 60% collectively pay about 3%.

    Illustration: Every night 10 men met at a restaurant for the Blue Plate Special. At the end of the meal, the bill would arrive: they owed a total of $100 for the food they shared. Every night they lined up in the same order at the cash register to pay the bill.

    The first four men paid nothing at all. The 5th , angry that his meal wasn’t free, paid $1.
    The 6th and 7th man, feeling overcharged, paid $3 and $7 respectively. The 8th and 9th men, increasingly resentful, paid $12 and $18 respectively. The 10th man was stuck paying the outstanding balance of $59 for his share. Bitterly, he nightly realized he was paying for 83% of the unpaid balance of diners 1-7.

    The 10 men were quite settled into their mostly happy routine when the restaurant threw them a curve: it was cutting its prices. Now, dinner for the 10 men would cost only $80.

    This clearly would not affect the first four men; they still ate for free. The 5th man announced he would now pay nothing either. The 6th man lowered his contribution by 1/3, and paid only $2. The 7th man decided to deduct $2 from his usual payment and paid only $5. The 8th man paid $9 instead of his usual $12. The 9th man paid $12-- $6 less than his usual $18.

    This left the 10th and last man with a bill of $52-- still $7 less than before. Now he is only paying 71% of the unpaid balance of diners 1-7. He tried to convince himself that this was
    a good deal for him.

    Outside of the restaurant, the men began to compare their savings, and angry outbursts erupted. The 6th man yelled: "I got only $1 out of the $20 in cost reduction and he got $7, pointing at the 10th man. The 5th man joined in: "Yeah! I only saved $1 too. It is unfair that he got seven times more than me." And, the 6th man voiced the same sentiment The 7th man cried, "Why should he get a reduction of $7 when I only got $2?". The first nine men formed an outraged mob, surrounding the 10th man. The first four men followed the lead of the others: "Even though we weren't paying anything in the first place, we didn't get any of the $20 reduction in cost. We want a share !!!"

    The nine angry men then dis-invited 10th man from their “friendly” dinner group. The next night, the nine remaining men met at the restaurant for dinner. But, when the bill came, no one could or would pay it. You should have heard the uproar then.


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    Time is a great teacher-- only problem is it kills all its pupils.
     
  2. MadMax

    MadMax Member

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    This would be an even better analogy if you said that in addition to the meal, the first few who didn't pay also received a dessert or something extra that the men who had to pay the bulk of the bill didn't receive. In this country, if you can't pay your taxes, we'll just give you a credit for it.

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  3. Rocketman95

    Rocketman95 Hangout Boy

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    Meanwhile,

    "While the share of federal taxes paid by the wealthiest Americans has ballooned in the past two decades, the income of that group has grown even faster, a study by the Congressional Budget Office shows.

    The report by Congress' nonpartisan fiscal analyst said that from 1979 to 1997, the portion of all federal taxes that is paid by the wealthiest one percent of households has grown from 15.5% to 23%. That means their share of taxes grew by 48%.

    During the same time, the average after-tax income of the wealthiest one percent swelled from $263,700 to $677,900-a 157% increase.

    The lowest-earning one-fifth of Americans saw their average after-tax income fall from $10,900 to $10,800 during the period, the study showed. Adn the middle one-fifth of Americans by income distribution went from a $33,800 average to $37,200 average-a 10% increase" -from wire services, 5/31/01

    So, quit your b****ing please. If your lucky enough to be in that top one percent, you have, after taxes, more than enough money than you know what to do with. If you expect anyone to feel sorry for you, then I hope you're proved wrong. Anyone that feels sorry for you while condemning those who are making a stellar $10,900 a year is a sorry individual.

    I'm sure you'll come back with some response like "well, it's their money, why should they support lazy welfare recipients"? Well, if that were true, I guess I'd agree with you. However, conservatives always forget one thing (other than the fact that the vast majority of those on welfare are not lazy bums) is that there are children involved. Why should the children suffer? For people who go on and on about the rights of the fetus, you sure don't give a crap about post-womb children.

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    www.swirve.com
    "Pre-born, you're fine, pre-school, you're f*****."-George Carlin
     
  4. haven

    haven Member

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    Three real responses:

    1. Pure practicality. It's not really feasible to have "even" tax cuts. If you tried it, you'd quickly run out of money, or bankrupt the lower-middle class.

    2. Wealthy people have benefited most from the prosperity ensured by a viable government. It's only fair that they pay more.

    3. Quality of life - you can tax a wealthy person more without substantially diminishing his quality of life.

    4. Wealthy people can't exist without non-wealty people. Your conclusion at the end is fatally flawed: the superstructure of wealth is supported by the lower-middle class. It's not like the wealthy will "disappear," although it is possible to tax the middle class out of existence.

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    A few years back on the Senate floor...
    Phil Gramm: "If Democrats could, they'd tax the air we breathe."
    Ted Kennedy (jumping up): "By God, why didn't I think of that sooner!"

    Boston College - NCAA Hockey National Champions 2001
     
  5. Major

    Major Member

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    Come on, RM95, you know better than to bring facts into this discussion. The rich should be able to make more and pay a smaller share of taxes - duh!

    It's much easier to make your case when using analogies and stripping away important parts, like the fact that to be accurate, each man would have had to be eating a different amount of food. But that ruins the point, so its convienently ignored.



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    http://www.swirve.com ... more fun than a barrel full of monkeys and midgets.
     
  6. RichRocket

    RichRocket Member

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    Rocketman95: Rough workout huh? You're in some kind of a mood! I take care of my children and I use my money to take care of the needy through charities. I'd just rather not do it through the ineffeciency of government. C'mon, ChoiceBoy, you can't have a problem with that can you?

    shanna: on the proportionality thing, I think I'd actually get the smaller portion. Other than national defense, what is the federal government doing for me that it's not doing for those who paid nothing AND what is it doing for THEM that it's not doing for ME.

    haven: how did you get so lucky as to be picked to be the one to define "fair?!" Lots of those folks who are the #10 guy work FOR someone. They aren't all Vanderbilts or Gateses.

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    Time is a great teacher-- only problem is it kills all its pupils.
     
  7. ArtVandolet

    ArtVandolet Member

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    I didn't see any "b****ing" except from the men that didn't pay for their dinner. Good Analogy - proven once again.



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  8. haven

    haven Member

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    Richrocket:

    Heh... now we're getting to a fundamental point about which it's hard to argue. I believe that people should pay taxes commensurate with the ability to become wealthy which they have derived from the current economic state.

    ArtVandolet: Say what? I've yet to hear of any "proof."

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    A few years back on the Senate floor...
    Phil Gramm: "If Democrats could, they'd tax the air we breathe."
    Ted Kennedy (jumping up): "By God, why didn't I think of that sooner!"

    Boston College - NCAA Hockey National Champions 2001
     
  9. SamCassell

    SamCassell Member

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    Can I get lobster on my blue plate special, Rich? I mean, as long as you're paying.

    Good god, I hope I'm never in a position for you to "take care of me through your charity." I get the feeling I'd probably starve.

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    Bingbong was set up, led to an untimely death in the prime of his life for no other reason than pure malice. Things like that do not go unavenged. Sometimes it spills out onto the field of play.
     
  10. MadMax

    MadMax Member

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    I'd have no problem with a flat tax where people up to a certain income level pay absolutely nothing. But when taxes go up, it's quite hard to stomach. You have European countries (particularly Scandaniavian) where people are nearly better off not working or working part-time than they are working full-time and/or overtime. That's what I would hope to avoid. I have no problem with rich paying a bit more...I do have a problem with the demonization of the wealthy though, which seems to come at every turn from the democrats in congress. I do have a problem with the fact that there seems to be little recongition of the fact that the wealthy create jobs and wealth for others.
    And I have a major problem with those who opposed this tax cut talking about how evil it is that the rich will get larger cuts than the poor. I find that to be extremely dishonest. I think that's where this original thread finds its genesis...not in b****ing that rich folks don't have enough money after taxes.

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  11. Major

    Major Member

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    You have European countries (particularly Scandaniavian) where people are nearly better off not working or working part-time than they are working full-time and/or overtime.

    You do realize that in a progressive tax system, you only pay higher rates on your marginal income, right? If you make $20,000 and I make $50,000, I pay the same tax-rate on the first $20,000 that you do.

    You never have more net "take-home pay" by making less in this system.

    I have no problem with rich paying a bit more...I do have a problem with the demonization of the wealthy though, which seems to come at every turn from the democrats in congress.

    Similar to the demonization of the poor, which seems to come at every turn from the Republicans in Congress? (You know, the evil, lazy people on welfare)

    I do have a problem with the fact that there seems to be little recongition of the fact that the wealthy create jobs and wealth for others.

    Similar to the little recognition of the work of the middle and lower classes that create profits for the wealthy?

    And I have a major problem with those who opposed this tax cut talking about how evil it is that the rich will get larger cuts than the poor.

    It's not that the rich get more cuts than the poor -- that's to be expected of any tax cut. It's that the rich get proportionally more cuts than the poor. For example, if a tax cut gives 70% of the savings to the top 5% of tax payers, while the top 5% only pay 40% of the taxes, something is goofy. I don't know whether Bush's tax cut does this or not. As it stands, I have no problem with this type of across-the-board tax cut, but I do have a problem in its magnitude that we cannot afford.

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    http://www.swirve.com ... more fun than a barrel full of monkeys and midgets.


    [This message has been edited by shanna (edited June 04, 2001).]
     
  12. Jeff

    Jeff Clutch Crew

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    Blah, blah, blah, blah, money, blah, blah, blah, blah, taxes, blah, blah, blah, rich, blah, blah, blah, poor, blah, blah, blah, blah...

    Did someone say something? [​IMG]

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    The internet is about the free exchange and sale of other people's ideas. - Futurama
     
  13. SpaceCity

    SpaceCity Member

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    MadMax,
    I have nothing against rich people. I hope to become one some day. But I already have a job, so what does cutting taxes for the rich and not the middle-class do for me?

    RichRocket,
    Weird analogy. If I was #10, I would have left that bunch of free-loaders a long time ago!

    What the government does for the poor doesn't need to be done for you. The rich don't need help getting into school, or buying food, or paying rent, or buying clothes for kids. On the other side, the rich get tax cuts, which I don't disagree with unless the middle or lower class has to make up for it.

    While I guess I can't prove it here, but I am confident that rich kids will get way more favors and opportunities than any equally-qualified middle or lower-class kid.

    It also appears that modern billionaires such as Bill Gates and Ted Turner seem to give more to the lesser classes than the Industrial billionaires. Both of those guys have each donated over a billion dollars for various causes that benefit the poor and middle-class.

    If all billionaires did the same then maybe there wouldn't be as much need for many of the programs that government has.


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  14. RichRocket

    RichRocket Member

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    True story: I have lunch every Thursday at a Thai restaurant with a group of guys. This group has been meeting for about 15 years: me-- the token conservative, a moderate Democrat insurance agent, a liberal environmentalist/counselor and two liberal college professors. Hey, don't laugh! These guys are my friends....

    We have had this discussion about the then-proposed tax-cut plan. I had been trying to concoct an analogy for them around our lunch tab when the above cited piece appeared in my email box just today(I didn't write it). I will pursue a different take on it when I have time to pursue it.

    I mailed them a copy of this analogy; we'll see how it goes.

    ********************************************

    SamCassell: you don't even know me, so I don't know where you come off insulting me like that. Are you a democrat?!

    ********************************************

    Am I a rich white guy? No. I'm smack dab middle class; race has nothing to do with it. I've worked at a non-profit and I've been employed in sales; I've had a business fail. I've been a stay-at-home dad for two of my three children.

    Do you see the stereotype yet?!

    I think some of you here are just too young or inexperienced to really know of what you speak. I don't know everything, but I do know that the important learning takes place in life outside of a formal educational setting. There you learn what is made available to you (by and large).

    As a young man, I used to be fairly liberal. In 1984 or 1990, I even wanted a chance to vote for Jesse Jackson for President just to shake things up. Thank goodness I didn't get my chance.

    Then I owned something of significance. Then I had a child. Then I got sick of the workaday world. It was raining inside the ivory tower.

    You, too, may change. I know I did.

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    Time is a great teacher-- only problem is it kills all its pupils.

    [This message has been edited by RichRocket (edited June 04, 2001).]
     
  15. haven

    haven Member

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    Ooooh la la! Conservative condescension!

    Isn't it also possible that when you become enraptured with bankbooks and "owning" something that you lose something? That perhaps you stop caring about ideals, and become a middle class phillistine? I never want ideology to become a second-class consideration to my home mortgage.

    Truth is independent of contingency and middle class paranoia. I'm a liberal because I believe that the ideals of liberalism are rich, and the only way to governs ociety fairly. Conservative philosophy fails to account for the fact that the US isn't a complete meritocracy, and that some people are at an inherent disadvantage from birth. Conservative philosophy also rests too heavily on an exclusive, narrow-minded, moral vision that I find repugnant and ill-suited for modernity.

    None of that has anything to do with my age or my pocketbook. Nor should it.

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    A few years back on the Senate floor...
    Phil Gramm: "If Democrats could, they'd tax the air we breathe."
    Ted Kennedy (jumping up): "By God, why didn't I think of that sooner!"

    Boston College - NCAA Hockey National Champions 2001
     
  16. RichRocket

    RichRocket Member

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    Not condescension, just criticism and pragmatism. Not about selling out but about buying in. In all likelihood you, too, will one day.

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    Time is a great teacher-- only problem is it kills all its pupils.
     
  17. Major

    Major Member

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    I think some of you here are just too young or inexperienced to really know of what you speak.

    This is the attitude that I find annoying. "You just don't know -- trust me." I've been self-employed since I was 14, built my business from the ground up, and have paid far more than my "fair share" of taxes.

    I would benefit personally a lot from the Bush tax cut (or, I would have last year). However, I still don't think it's a good idea. First, I don't think its fiscally sound. If you're in debt, you don't give away what little extra money you have unless absolutely necessary - you pay your debts first. Second, having had some financial success, I feel that I have a responsibility to those that maybe didn't have the opportunities I had. I hope that belief never changes in me, as I'll be much worse off without it.


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  18. SamCassell

    SamCassell Member

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    I consider myself an independent, though I am fairly liberal on social issues. And I didn't mean to insult you. I just found the notion that you would personally take care of the "needy" through charity to be a little condescending towards the poor. I think charity is a great concept, but we as a country and a society shouldn't depend on the rich to decide who is worthy of largesse, and in what amounts. It should be determined by those who we have voted as our representatives. Further, there are plenty of social programs out there that have nothing to do with income or poverty. Further, the implication that somehow the progressive tax structure constitutes "charity" to those making less money, because they pay less in taxes (which I guess is part of the gist of your analogy) is patently ludicrous. Taxing people on the basis of what they can afford is not only sensible from an economic perspective, but it mirrors the greater benefit the upper classes gain from maintaining the status quo.

    Again, no personal insult intended. See, a smilie ---> [​IMG]

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    Bingbong was set up, led to an untimely death in the prime of his life for no other reason than pure malice. Things like that do not go unavenged. Sometimes it spills out onto the field of play.
     
  19. RichRocket

    RichRocket Member

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    shanna: remember, the money belongs to the people who paid the taxes not to the government. It's not the people's debt it is the government's!!

    SamCassell: I'm not THE RICH. I just think that 30 or 40 years of the government taking care of it has done nothing but entrench it.

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    Time is a great teacher-- only problem is it kills all its pupils.

    [This message has been edited by RichRocket (edited June 04, 2001).]
     
  20. Rocketman95

    Rocketman95 Hangout Boy

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    So, if I have to give $10 to shanna, it's still my money? I don't think so.

    Whether you like it or not, living in this country means you have to pay taxes, and once you pay those taxes, it's then the governments money, not your's.

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    www.swirve.com
    "Pre-born, you're fine, pre-school, you're f*****."-George Carlin
     

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