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Re: The American Election

Posted: Mon Nov 03, 2008 3:59 am
by matthijs
When talking about taxes and "spreading the wealth", I think it's interesting to take a good look at the numbers.

Between 1979 and 2005, the top five percent of American families saw their real incomes increase 81 percent. Over the same period, the lowest-income fifth saw their real incomes decline 1 percent.
There is a high and increasing income inequality in the US. The top 1% population has an income equal to 45% of the bottom earners (in 2004).
See more numbers for example here
http://en.wikipedia.org/wiki/Income_ine ... ted_States
There are a couple of official institutions which give some numbers to study as well, like:
http://www.census.gov/hhes/www/income/h ... f03ar.html

This very large inequality is what makes talking about tax plans difficult. But once you understand the numbers a bit, it will place the fear of some "middle-class" Americans for higher taxes into a bit of perspective. The crucial piece of information is the large inequality. Let's just assume that the amount of money needed to run the country (that includes building roads, financing the army, health care, etc) stays the same. (in reality tax revenue will have to increase to pay for paying back the country's debts and the population getting older, retiring, etc)

A tax cut for the richest 1% (as Bush did) means a huge amount of tax revenue is missed. A tax cut for the lower incomes has a very small influence on the tax revenue. Now it's funny to hear an average Joe talk about being afraid of redistribution of wealth. So he might vote Republican, because in general the Republican party is for lower taxes (especially for the rich). But if you look at the income distribution, you realize that the benefits of those lower taxes will almost all go to the very rich. The lower income groups make so little money, that increasing or decreasing their taxes doesn't make much difference. In other words, from an emotional perspective, you can be mad at your poor neighbor who doesn't make much money and doesn't pay much taxes, while you do. But from a broader perspective, the only way to be able to run the country, is by increasing taxes on the richest people.

Why so many people seem to think that a progressive tax system is wrong is difficult to understand, considering these numbers. Why is Joe the plumber so afraid of the tax increase from 35% to 39% for the amount of money he might make more then $250.000? (Obama's plan)


Then there's the second problem of such a large inequality. Having a very small group of very rich individuals and corporations owning almost all the money in the country brings along a great risk for the democracy of the country. Money equals power and influence. And corruption. Just look at the 38.000 well-paid lobbyists in Washington. And the huge influence of large corporations on the legislative process.

Re: The American Election

Posted: Mon Nov 03, 2008 4:40 am
by panic!
Cirdan wrote: No because taxes are needed for the government to function, and to support our army.
What about all those roads, firefighters, policemen etc, should they all be built/run with 'charity' money.
Cirdan wrote: Taxes are being used by the government to run itself. I do not want the government taking my money and redistributing it to those who need help, to the poor, to the lazy and to the illegal aliens.
What sort of society lets it's citizens die of starvation and illness?
Cirdan wrote: If the government gives money to the poor, why should I work?
.
To contribute to society? Do you hate contributing to society?
Cirdan wrote: I should stop working and let the government give me money.
The money a government gives people who don't work is usually very small and just enough to live on for a month or so. No one is suggesting that we make all people 'too lazy' to work millionaires.

The government here where suggesting a scheme where people long term unemployed should have to earn their benefit money in community work. Which I whole heartedly agree with. It would both give people work to do and contribute to society.

arborint wrote:I think the Chinese might disagree with you.
Yup:
China = 11% growth.
USA = 2% growth.

In China their 'recession' of 'only' 9% growth is over 4 times the States' normal growth.

I'm not saying China is a model country at all but they're economically growing much faster than the States...and they are a very socialist country so the idea that socialism hinders growth is a bit silly.
matthijs wrote:
Why so many people seem to think that a progressive tax system is wrong is difficult to understand, considering these numbers. Why is Joe the plumber so afraid of the tax increase from 35% to 39% for the amount of money he might make more then $250.000? (Obama's plan)
Yes, exactly. This comic sums it up for me: http://www.salon.com/comics/boll/2008/10/23/boll/


onion2k wrote: Countries like Sweden are really nice places to live whether you're rich or poor. Isn't that something to aspire to as a nation? It's all very well being wealthy and having nice things, but if you step out of your door and see people living in poverty you're never going to be happy. Or, rather, you shouldn't be. I guess some people are happy to ignore the plight of other people...
Yup. Again, totally agree. Countries like Sweden with low domestic violence, low crime-rates, scaled income tax, great healthcare system, generally happy, low drug use rates etc etc.

If you love your country it's not the ground you physically live on that you love, it's the people and the society and the culture that make up the country. Therefore I think distributing the wealth in a more socially responsible way is far more patriotic than pure capitalism.

I'm not talking about a totalitarian, stalinist system. I'm talking about taxing and corporations who are more than comfortable contributing BACK to the people who make their business/wealth possible.

There will always be poor and rich, successful and less people in any society but I see no harm at all in taxing those who are comfortable a little bit more.

Re: The American Election

Posted: Mon Nov 03, 2008 7:33 am
by omniuni
The question as to whether the world should favor McCain or Obama? If a man has an open mind, you can change it. If Obama wants to pass regulation that would hurt another countries economy, they can work together to find a solution. Can you really see McCain sitting down with some small country to work out the bugs in an elaborate trade plan? I don't see him taking the time to do so.

I do not want to speak against McCain's personal features. So what if he appears uncomfortable when questioned? So what if he sometimes stutters or misses a word. These are things we tease Bush about, but they're not what make him a bad president or a bad presidential candidate.

What shakes my faith in McCain is how he has wavered in his viewpoints to more closely match the Republican party. I am bothered by his choice of Sarah Palin, because marketability aside, her head is empty. You could say Biden was a marketing choice, if you want, but you can certainly not call him dumb! He has met with so many dignitaries and representatives... he's still alive! That speaks well for him!

Of course, a president is mainly for show. A president has a lot of influence, but very little real power except military control. No radical plans from the president will get approved, but if the president is working for the party, some crazy things can get through. The vice president is possibly the most important diplomat in the country, and we can't risk a second-in-command making a muck in foreign countries. Hands down, I favor Biden ( 8) ) over Palin ( 8O ) in that one.

By the way, thank you all for your opinions, and for keeping everything civil. I love constructive, friendly debate.

Re: The American Election

Posted: Mon Nov 03, 2008 7:35 am
by panic!
I like how Palin has given 3 interviews.

Re: The American Election

Posted: Mon Nov 03, 2008 7:37 am
by josh
panic! wrote:
Cirdan wrote: If the government gives money to the poor, why should I work?
.
To contribute to society? Do you hate contributing to society?
Fallacies like this I feel like are not only rude but are the reason why these kinds of discussions are banned. Obviously he doesn't necessarily hate contributing to society and he raises a perfectly valid point.

I think everyone in this thread is also overlooking that all of our income taxes just cancel out our debt. None of that goes towards welfare, etc.. that's why we have gas taxes, cell phone taxes, etc.. that the merchants have to pay ( which means we're really the ones paying we just don't get told about it ). The amount we take in via income taxes isn't enough to pay off the interest for our own debt, and everyday we drop millions of dollars more worth of missiles, where do you think all that $ is coming from? They're printing it out. Based on supply and demand the more they print the less its worth, meaning we pay even more ( in worthless dollars ) to pay off the additional debt. It's a negative feedback cycle, the cycle itself is our tax.

Re: The American Election

Posted: Mon Nov 03, 2008 7:41 am
by josh
omniuni wrote:I do not want to speak against McCain's personal features. So what if he appears uncomfortable when questioned? So what if he sometimes stutters or misses a word. These are things we tease Bush about, but they're not what make him a bad president or a bad presidential candidate.
Well usually its combined with a response that defies all sense of grammar or context, evades the questions, or just acts ignorantly in my opinion. Someone could have all the right policies but if they can't keep themselves under emotional control they cannot make decisions based on sound logic. The job of the president is to veto bills [among other things], if that role were to be filled by an extremely gullible person, that was easily to manipulate, or theoretically someone who took bribes from lobbyists, that wouldn't be good.

Re: The American Election

Posted: Mon Nov 03, 2008 8:03 am
by omniuni
THAT, jshpro2, is what makes a bad president!

Unfortunately, I will also mention that you are very right in what you say about printing money. It's a problem. A big one. Unfortunately, I don't see what we're going to do about it right now. I don't think anyone, EITHER of the candidates, knows either. :(

Oh, and some people really DO hate helping the underprivileged. I was once volunteering at a huge fund-raiser at my college called Shackathon for habitat for humanity. During the event we all ask passers-by for change. (Literally, $0.05 is fine) Habitat for humanity, if you don't know, helps society by building houses for working people so that they can pay it off over time but for much less than they would have to pay otherwise so that they can get on their feet. The families also have to contribute hundreds of community service hours. This guy, all dressed in shiny shoes, a sports jacket, and expensive glasses looked me right in the eyes when asked for change just like every person before him, and said "Shut the F*** up! They can buy their own D**n houses."

These people make me sad. H4H isn't even one of the organizations that just "gives money away". (If you're interested, here's a link about it, it's an awesome event that I participate in each year. http://www.redhat.com/magazine/026dec06 ... dmsept_007)

Re: The American Election

Posted: Mon Nov 03, 2008 8:35 am
by panic!
jshpro2 wrote:
panic! wrote:
Cirdan wrote: If the government gives money to the poor, why should I work?
.
To contribute to society? Do you hate contributing to society?
Fallacies like this I feel like are not only rude but are the reason why these kinds of discussions are banned. O
Sorry, it was a bit of a personal attack, I do apologise. That said: I do feel working and paying taxes does contribute to society more than not working and not paying taxes, would you not agree?
jshpro2 wrote: I think everyone in this thread is also overlooking that all of our income taxes just cancel out our debt. None of that goes towards welfare, etc..
In the UK and many European countries it does and I'm putting forward the more socialistic model as a successful blueprint.

It's deducted at source for most people. And if you read an earlier post where I talk about national insurance going towards NHS (free healthcare), Welfare or benefits as we call it in the UK, extremely subsidised prescriptions and a basic pension.

Re: The American Election

Posted: Mon Nov 03, 2008 9:10 am
by josh
panic! wrote:In the UK and many European countries it does and I'm putting forward the more socialistic model as a successful blueprint.
I thought the UK was worse off then the US, IDK, I wouldn't know for sure.

Also I agree people need incentive to contribute to society, there also needs to be a reward system where if joe contributes more then sue, joe gets payed more then sue, otherwise you run into the same problems you do with communism. I hardly thing illegal immigrants or people abusing welfare are a top priority for the US economically, we have much bigger issues to tackle and I would be inclined to say the media is using these smaller issues such as gay marriage, Paris Hiltons latest drama, etc.. as a form of smoke and mirrors to distract us from the larger issues.

And yes even the income tax your employer matches if you're on a W-2 gets cancelled out by our debt's interest. I would go as far as to say that all forms of visible tax go towards paying off debt ( sales tax income tax, etc.. ) Can I prove it? No... I guess I'm just a crazy conspiracy theorist

http://www.independent.co.uk/news/busin ... 76505.html

Re: The American Election

Posted: Mon Nov 03, 2008 9:21 am
by onion2k
jshpro2 wrote:Also I agree people need incentive to contribute to society, there also needs to be a reward system where if joe contributes more then sue, joe gets payed more then sue, otherwise you run into the same problems you do with communism.
So long as tax is levied at a level under 100% that'll still be the case though. Obama is talking about raising the level from 35% to 39% for earnings above a particular threshold ... you're still keeping 61% on everything you earn over $250,000. That's a huge sum of money that you can earn before hitting the tax that's increasing. To put it into perspective, here in the UK we pay 40% on everything over about $70,000.

Is there realistically any chance of you earning more than $250,000/year at any point in the next presidential term? If there isn't, why on Earth are you arguing against this policy? You won't benefit in any way.

Re: The American Election

Posted: Mon Nov 03, 2008 9:26 am
by matthijs
jshpro2 wrote:I think everyone in this thread is also overlooking that all of our income taxes just cancel out our debt. None of that goes towards welfare, etc.. that's why we have gas taxes, cell phone taxes, etc.. that the merchants have to pay ( which means we're really the ones paying we just don't get told about it ). The amount we take in via income taxes isn't enough to pay off the interest for our own debt, and everyday we drop millions of dollars more worth of missiles, where do you think all that $ is coming from? They're printing it out. Based on supply and demand the more they print the less its worth, meaning we pay even more ( in worthless dollars ) to pay off the additional debt. It's a negative feedback cycle, the cycle itself is our tax.
Not sure if the dollars are just printed like that. As far as I know, the money is borrowed, both from people and companies within the US and from foreign countries (china and japan). Recently the national debt clock on times square ran out of numbers
http://news.bbc.co.uk/1/hi/business/7660409.stm

What's also a very important issue for the next president is foreign policy. A major change is needed in that area to prevent things from getting even worse then they are now. No more bombs but instead major diplomatic efforts to restore international relations. No single army, even one twice as large as the current US army, can win a war against invisible insurgents. Probably it's even the case that each bomb that kills one bad guy but also has a collateral damage of one innocent person, just creates so much new hate that 10 new terrorists stand up.

As a probable side effect, a big boost in US and global economy would come from not fighting 3-trillion dollar wars and having more stability in areas like the middle-east.
onion2k wrote:To put it into perspective, here in the UK we pay 40% on everything over about $70,000.
Here in the Netherlands it's 52% above € 53.860 ... :)

Re: The American Election

Posted: Mon Nov 03, 2008 9:32 am
by onion2k
matthijs wrote:
onion2k wrote:To put it into perspective, here in the UK we pay 40% on everything over about $70,000.
Here in the Netherlands it's 52% above € 53.860 ... :)
Also $70,000 then. That's high, but I think your public services are pretty good too. That's one of the things about the UK.. we pay a relatively high proportion of our income in tax and our services still suck. Better than the USA.. but still. :banghead:

Re: The American Election

Posted: Mon Nov 03, 2008 9:52 am
by panic!
jshpro2 wrote:
panic! wrote:In the UK and many European countries it does and I'm putting forward the more socialistic model as a successful blueprint.
I thought the UK was worse off then the US, IDK, I wouldn't know for sure.
In terms of our healthcare system we're ranked about 20 places higher than the United States in the World Health Organisations last rankings I think. Read some of my earlier posts if you want, so you know the angle I'm taking.
jshpro2 wrote:Also I agree people need incentive to contribute to society, there also needs to be a reward system where if joe contributes more then sue, joe gets payed more then sue, otherwise you run into the same problems you do with communism.
jshpro2 wrote:
panic! wrote:In the UK and many European countries it does and I'm putting forward the more socialistic model as a successful blueprint.
I thought the UK was worse off then the US, IDK, I wouldn't know for sure.
In terms of our healthcare system we're ranked about 20 places higher than the United States in the World Health Organisations last rankings I think. Read some of my earlier posts if you want, so you know the angle I'm taking.
jshpro2 wrote:Also I agree people need incentive to contribute to society, there also needs to be a reward system where if joe contributes more then sue, joe gets payed more then sue, otherwise you run into the same problems you do with communism.
Yeah, that reward system is called your salary. The more you earn..the more you earn.

The UK model:

If your income is £5,000 a year ($10,000 very approximately) because you work part time
You keep £5,000 a year.
Your healthcare, pension and benefits are totally free.
You pay no income tax.

If your income is £10,000 a year ($20,000 very approximately)
You keep £8700 a year
£500 a year pays towards your healthcare, pension and benefits
£800 a year of that is your income tax.

If your income is £25,000 a year ($50,000 very approximately)
You keep £19,000.
£2,100 pays towards your healthcare, pensions and benefits
£3,793.00 is your income tax.

if your income is £100,000 ($200,000 very approximately)
You keep £64,970.60
£4,403.40 pays towards your healthcare, pensions and benefits
£30,626.00 is income tax.


I think it's a fair system. I earn in the second to top tax bracket as I've mentioned, I don't mind sharing for the good of my country and my fellow citizens :)


I agree that we shouldn't give benefits to illegal immigrants and people who are lazy, definitely. I think border policy is a whole other discussion for another day though!

Re: The American Election

Posted: Mon Nov 03, 2008 9:57 am
by matthijs
onion2k wrote:That's high, but I think your public services are pretty good too
Yes it's high. But you get so much in return. Very good (universal) health care, very good education, good infrastructure, etc etc

But it's also good from a moral view point. Having a good system in place creates real opportunities for all. If someone is smart enough to go to university, study hard and become a doctor, he or she can. No matter what income the parents have. You don't have to be a rich kid. Even the kid of a refugee can become a successful lawyer if he works hard enough.

And the argument about the need for an incentive to work hard: that incentive is still there. You can still become rich if you want, work hard and have a bit of luck.

Re: The American Election

Posted: Mon Nov 03, 2008 9:58 am
by panic!
onion2k wrote:
matthijs wrote:
onion2k wrote:To put it into perspective, here in the UK we pay 40% on everything over about $70,000.
Here in the Netherlands it's 52% above € 53.860 ... :)
Also $70,000 then. That's high, but I think your public services are pretty good too. That's one of the things about the UK.. we pay a relatively high proportion of our income in tax and our services still suck. Better than the USA.. but still. :banghead:
Also...Council tax :banghead: arrrghh