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how much taxation should citizen A-B-C contribute to Corporation X?

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heeheeheeheeheeheeheehee . . .

Come on Wall Street
Don't be slow
Now's the time for War-a-go-go
There's plenty of good money
To be made
Supplyin' the Army with the tools of its trade
And we know that war can only be won
When we blow 'em all to kingdom come . . .

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Lola wrote:

How many of us who were given $50,000 or more in the form of a tax cut gave that amount to charity or to those who will need help with their retirement?
I don't know. I bet it's somewhere between 10% and 90%. If only 10%, it adds up to a huge amount. Of course that doesn't include the additional job opportunities that arise as a consequence of increased investment of discetionary income and/or purchases of facilities, products, services, and commodities.

If people don't have what they need and can't get it by a lifetime of hard work they will become a problem for everyone, not just themselves. And it won't be about greed, it will be about need.
As I see it, the number of people who "don't have what they need and can't get it by a lifetime of hard work" is less than 7% of the population.

More than half of those who are need, are in need because of physical or mental disabilities caused by drugs or other forms of self-abuse. A significant proportion of both groups, the self-abusers and non-self-abusers, are or can be adequately cared for by family members. Many are also recoverable to the point of self-sufficiency if competently helped and motivated. The rest are or can be adequately cared for by voluntary (e.g., private) rather than compulsive (e.g., government) charitable and philanthropic organizations.

Government charitable and philanthropic organizations are far less effective and efficient than are private charitable and philanthropic organizations in really helping people who are truly in need. Unfortunately, too many such government organizations generally seek to increase and not reduce the number of people in need. Probably that's true because such government organizations are created mainly to buy and hold on to votes for politicians, and not buy effective help for those who truly need it. If this were not true, the trillions of dollars spent on meeting people's needs, would have produced less and not more people in need.

I think some definitions are in order. The following are my definitions.

need is what one requires to survive healthfully.

want is more than what one requires to survive healthfully.

greed is working to obtain more than one has.

pernicious greed is working unlawfully and/or dishonorably to obtain more than one has.

envy is working to cause others to obtain less than they have.

pernicious envy is working unlawfully and/or dishonorably to cause others to obtain less than they have.

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Foxfyre wrote:

So everybody, let's put this into a more concrete framework:

If Citizen A finished highschool and is gainfully employed making $30,000/year but is having trouble obtaining healthcare or saving for retirement;

If Citizen B worked his/her way through college, is paying off student loans, and is gainfully employed making $75,000/year - s/he has a good health care plan and saves 10% or more of his/her income in IRAs and 401ks;

If Citizen C inherited Daddy's business and is now a corporate executive earning $250,000/year. His health care and substantial retirement is paid for by the corporation.

And Citizen D dropped out of highschool, has never been gainfully employed for long, has no marketable experience or skills, has no savings of any kind, and is short on health insurance, opportunity, and cash. . . .

Who is responsible to take care of Citizen D?

Excellent post!

If one believes that society is responsible for D being in his wretched state, then a reasonable argument can be made that society should take care of poor D.

If, on the other hand, one believes that the individual is, overwhelmingly, responsible for his or her fate, then it comes down to one's tolerance for suffering (deserved or otherwise) in one's society.

Personally, I think that it is intolerable for any of our citizens to unwillingly starve to death, live in boxes on the street, or be unable to acquire basic healthcare.

Thankfully, we live in a country where this is not the case.

(Now comes the thunder and lightening.)

Unless D is also a drug addict, alcoholic or insane, he is not going to starve to death, live in a box on the street or be unable to secure basic healthcare.

The debate, consistently, bogs down when it comes to the question of why D is a D. Assuming D is a lazy son-of-a-bitch who is more than willing to live off society's teat, I still believe that we are a wealthy enough nation to accommodate such miserable wretches. Now, does accommodation include color televisions, cell phones, trips to Atlantic City? Hell no!

And yet what do we do when D has little d's? What is our responsibility to the little d's? And if it is greater than our responsibility to D, how do we discharge it without unjustly enriching D? This, to me, is the tougher question to answer.

If we, as a society spend 100% of our wealth on caring for the D's and their d's, can we reasonably expect that we will, eventually, run out of D's and thus d's?

Nope.

There will always be people who prefer to do less. There will always be people who are born into the families of people who prefer to do less.

Everyone faces a myriad of challenges in their lives, and there are a myriad of people who have overcome the most incredible challenges, and so we need to throw aside the notion that D's are D's through no fault of their own.

I am a B+ who is willing to share some measure of my wealth so that I can sleep at night knowing that fellow Americans are not starving to death, living in boxes on the street, or unable to attain basic healthcare.

Frankly, I am tired of people who insist that I contribute more rather than increasing their own contributions.

There is nothing charitable about A's insisting that B's and C's contribute more to the welfare of D's. It is simply a matter of misappropriating someone else's wealth to satisfy one's own conscious.

The proof of this puddin is that the Liberal A's are not arguing that everyone's taxes should be increased to pay for social programs, only that the B's and C's taxes should be increased.

This tends to be predicated upon the belief that B's and C's cannot achieve their status without somehow ripping off of the A's and D's of the world.

So...let's keep the D's fed, sheltered and fit, even if they don't deserve our help, but let's hold it at the basics. If one feels they are entitled to more, dip into one's own pocket, and stay out of mine.

As for the d's, I'm afraid I don't have an answer. It would seem that the only way for the State to make sure that's its largess benefits the d's rather than the D's is to separate the d's from the D's and make them wards of the State or foster children of A's, B's or C's. For a number of reasons, this is an unacceptable answer.

Therefore, do we contribute our wealth to attempt to help the d's knowing that a large measure of it will be misappropriated by the D's, or do we sacrifice the d's?

Short of separating the d's from the D's, we cannot assure that our generosity will benefit them, and so do we waste it to help the few or withhold it entirely?

Frankly, I am far more concerned with the d's of the world and how we help them them than their adult parents.

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The NY Times had an article today on why they suck....er, how they can make themselves more 'credible'. Of course, they didn't ask me (actually they didn't ask any of their readers...just appointed some panel to clue them in). Anyway, my first suggestion would have been to get rid of Paul Krugman. That would give them just a wee bit of credibility in my eyes.

I read the article by him that Lola posted. Here's a smackdown of Krugman's opinion piece by Jack Kemp.

In the static world of the left
Jack Kemp

May 9, 2005

The left's latest misinformation campaign claims that if President Bush would just call off the tax cuts, there would be more than enough revenue to make Social Security solvent in perpetuity. As perpetually wrong economist Paul Krugman put it in Monday's New York Times, "Repealing Mr. Bush's tax cuts would yield enough revenue to call off his proposed (Social Security) benefit cuts, and still leave $8 trillion in change."

What those on the left never tell you is they make this calculation assuming, contrary to all available empirical evidence, that no one's economic behavior changed at all when the Bush tax rate reductions were enacted. Under this ridiculous assumption, you don't need a Ph.D. in economics to calculate the so-called "revenue loss" - in Krugman's words $8 trillion. Here's how he calculates the so-called decline in revenues.

If nothing else transpires when tax rates on capital and labor are reduced, he simply multiplies the reduction in the tax rate times the amount of capital and labor that is subject to the tax (this is commonly called the tax base).

In the static world that liberals like Krugman inhabit, people don't save and invest more when the tax rate on dividends and capital gains is lowered. People don't work harder when the tax rate on labor is reduced. Entrepreneurs don't start more new ventures when the capital gains tax rate is reduced, and businesses don't invest in more plant and equipment when they are allowed to write the investments off in the first year rather than having to depreciate them over a decade or more.

Of course, nothing could be further from reality. The laws of supply and demand work just the same for capital and labor as they do for other commodities. Raise the price of a good and you will sell less of it. Lower its price and you will sell more of it. Therefore, firms can't maximize their revenue by simply raising their prices. They must optimize prices by finding the one unique price - not too high, not too low - that will lead to just the right amount of sales to maximize revenues.

The dynamic consequences of changes in tax rates, like any other price changes, ripple across all sectors of the economy. Raise taxes on labor, for example, and you lower workers' after-tax wages. Workers will work less at the prevailing wage, which means some or all of the higher revenues Krugman calculated will evaporate as fewer workers report to work. Moreover, firms must counteract or circumvent workers' reaction to higher labor taxes by paying them higher wages, substituting capital for labor to compensate for fewer workers willing to work at prevailing wages or by producing and selling fewer goods and services, probably some combination of all three.

In any event, the cost of production rises in all three cases and output falls, which means there is another downward force exerted on government revenues, once again upsetting Krugman's revenue estimates.

Raise taxes on capital, and the story is the same. Firms will produce and sell fewer goods and services at current prices. Less labor will be hired, and fewer inputs will be purchased.
Again, after all dynamic adjustments have rippled through the economy, tax revenues will not increase as much as Krugman might project. In fact, depending on the circumstances, revenues may actually decline from their pre-tax-increase level.

Increase the capital gains tax rate and you increase what economists call the hurdle rate for new ventures, namely the rate of return a new venture must yield to entice investors to put capital into the project. As the hurdle rate rises, fewer new projects can successfully get over it; fewer new ventures are undertaken, fewer jobs are created and revenues, in most cases, end up lower than they were before the capital gains tax was raised.

Krugman would call this voodoo economics, but listen to what his hero, John Maynard Keynes said, "Nor shall the argument seem strange, that taxation would be so high as to defeat its object and that given sufficient time to gather the fruits, a reduction of taxation will run a better chance than an increase of balancing the budget. To take the opposite view today is to resemble a manufacturer who, running at a loss, decides to raise his price. And when his declining sales increase the loss, wrapping himself in the rectitude of plain arithmetic, he decides that prudence requires him to raise the price still more. And who, when at last, his account is balanced with naught on both sides, is still found righteously declaring that it would have been the act of a gambler to reduce the price when you were already making a loss."

The evidence indicates that this is precisely what happened when President Bush convinced Congress to cut the tax rate on dividends and capital gains and to allow small businesses to recover their capital investments quicker by writing them off in a shorter period of time.
Revenues continue to pour into the U.S. Treasury so fast the Congressional Budget Office projects that if the tax cuts are left in place permanently, the budget will be balanced within a few years, and revenues as a share of Gross Domestic Product will remain pretty much where they have stayed since the end of World War II, right about 18.5 percent of GDP.

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Quote:

Revenues continue to pour into the U.S. Treasury so fast the Congressional Budget Office projects that if the tax cuts are left in place permanently, the budget will be balanced within a few years

Love to see a link to this, as it directly contradicts the information that I have read in the past.

Congress is going to vote to raise the debt ceiling by 700-something billion dollars so we can keep running, and you're going to crow about how good the tax cuts have been for us? Please!

Cycloptichorn

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Cycloptichorn wrote:

...Congress is going to vote to raise the debt ceiling by 700-something billion dollars so we can keep running, and you're going to crow about how good the tax cuts have been for us? Please! Cycloptichorn

Tax cuts are good for the US economy.

Spending increases on non-essentials are bad for the US economy.

Those spending increases that take money from some and transfer it to others are bad for the US economy. Little of value is produced thereby, and such increases are also bad for the recipients of those transfers. These recipients are encouraged to remain or become Ds. Generally, we get more of what we choose to pay for.

I'm willing to pay more to secure our liberty. If a majority of us are also willing, we are more likely to get what we pay for.

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Historically, Citizen B is the one most likely to offer gainful employment to both Citizen A and Citizen D as most new jobs are created in the small business sector. Citizen C also hires a lot of people and is also the one most likely to be a patron of the arts and pledge seed money for a new hospital wing. Obviously higher taxes will reduce both Citzen B and Citizen's C ability to offer training and/or employment to Citizens A and D.

Finn is right that American compassion simply won't allow Citizen D to go without the basics (food, shelter, clothing) necessary to sustain life. And both the left and right willingly chip in to ensure that. But here is also where I see the lines drawn between 'right' and 'left'.

Those on the 'left' I think will be more likely to see Citizen D as a victim in need of understanding, sympathy, and empathy. The 'left' is more likely to favor government taking charge of that. Most particularly, those working for the government are in favor of government taking charge of that even if their own taxes are substantially higher.

Those on the 'right' I think will be more likely to want benevolence to be voluntary and look for ways to help and encourage (or coerce) Citizen D to improve his/her circumstances. The 'right' are more likely to see the injustice of creating a permanent underclass and are also less likely to be sympathic for those who choose to be a part of the permanent underclass. In other words, the 'right' considers a job to be better than charity any day of the week.

How many receiving substantial tax cuts donated them to charity? Probably not a lot though those who tithed would have tithed a share. But more importantly, how many receiving substantial tax cuts spent them on goods and services thus boosting the economy with the inevitable results that more jobs were created for the Citizen's A and D of the world. How much was invested thus helping to secure the financial underpinnings of the economy? How much was saved as a hedge against becoming a Citizen D at some future time?

The 'left' seems to tend to look to raising taxes to raise revenues to help the less fortunate and tends to think tax cuts take from the poor.

The 'right seems to tend to look to boosting the economy creating better opportunities for the less fortunate to help themselves and tend to think higher taxes take from the poor.

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Foxfyre, your post is an excellent analysis which both right and left ought to study carefully. I know I will.

To help my study, I include both these posts of yours in the same post.

Foxfyre wrote:

... Citizen A finished highschool and is gainfully employed making $30,000/year but is having trouble obtaining healthcare or saving for retirement;

...Citizen B worked his/her way through college, is paying off student loans, and is gainfully employed making $75,000/year - s/he has a good health care plan and saves 10% or more of his/her income in IRAs and 401ks;

... Citizen C inherited Daddy's business and is now a corporate executive earning $250,000/year. His health care and substantial retirement is paid for by the corporation.

... Citizen D dropped out of high school, has never been gainfully employed for long, has no marketable experience or skills, has no savings of any kind, and is short on health insurance, opportunity, and cash.

Who is responsible to take care of Citizen D?

Foxfyre wrote:

Historically, Citizen B is the one most likely to offer gainful employment to both Citizen A and Citizen D as most new jobs are created in the small business sector. Citizen C also hires a lot of people and is also the one most likely to be a patron of the arts and pledge seed money for a new hospital wing. Obviously higher taxes will reduce both Citzen B and Citizen's C ability to offer training and/or employment to Citizens A and D.

Finn is right that American compassion simply won't allow Citizen D to go without the basics (food, shelter, clothing) necessary to sustain life. And both the left and right willingly chip in to ensure that. But here is also where I see the lines drawn between 'right' and 'left'.

Those on the 'left' I think will be more likely to see Citizen D as a victim in need of understanding, sympathy, and empathy. The 'left' is more likely to favor government taking charge of that. Most particularly, those working for the government are in favor of government taking charge of that even if their own taxes are substantially higher.

Those on the 'right' I think will be more likely to want benevolence to be voluntary and look for ways to help and encourage (or coerce) Citizen D to improve his/her circumstances. The 'right' are more likely to see the injustice of creating a permanent underclass and are also less likely to be sympathic for those who choose to be a part of the permanent underclass. In other words, the 'right' considers a job to be better than charity any day of the week.

How many receiving substantial tax cuts donated them to charity? Probably not a lot though those who tithed would have tithed a share. But more importantly, how many receiving substantial tax cuts spent them on goods and services thus boosting the economy with the inevitable results that more jobs were created for the Citizen's A and D of the world. How much was invested thus helping to secure the financial underpinnings of the economy? How much was saved as a hedge against becoming a Citizen D at some future time?

The 'left' seems to tend to look to raising taxes to raise revenues to help the less fortunate and tends to think tax cuts take from the poor.

The 'right seems to tend to look to boosting the economy creating better opportunities for the less fortunate to help themselves and tend to think higher taxes take from the poor.

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Quote:

Tax cuts are good for the US economy.

Sometimes! You need to qualify such bold statements!

Strangely enough, our economy is doing, well, badly at the moment. And this during the time of great tax cuts. How do you reconcile the fact that:

Quote:

Real wages in the US are falling at their fastest rate in 14 years, according to data surveyed by the Financial Times by the Economic Policy Institute.
Inflation rose 3.1 per cent in the year to March but salaries climbed just 2.4 per cent, according to the Employment Cost Index. In the final three months of 2004, real wages fell by 0.9 per cent.

The last time salaries fell this steeply was at the start of 1991, when real wages declined by 1.1 per cent.

Stingy pay rises mean many Americans will have to work longer hours to keep up with the cost of living, and they could ultimately undermine consumer spending and economic growth.

Many economists believe that in spite of the unexpectedly large rise in job creation of 274,000 in April, the uneven revival in the labour market since the 2001 recession has made it hard for workers to negotiate real improvements in living standards........

"There is still little evidence that workers are gaining much traction in their negotiations," said Paul Ashworth, US analyst at Capital Economics, the consultancy. "If this does not pick up, it raises the prospect of a sharper slowdown in consumer spending than we have been expecting."

http://news.ft.com/cms/s/f269a8f4-c173-11d9-943f-00000e2511c8.html

As you can see, the wages of the average worker are falling. We aren't creating new avenues of investment to pull us out of our cycle.

The tax cuts for the rich have produced... what, exactly? What jobs have they produced? How have they helped the average worker? You supply-side economics supporters claim that it 'boosts the overall environment' for the average worker, thereby bettering his quality of life; how many times, throughout history and modern day, does this have to be proven to be a lie?

The idea that higher taxes take away from the poor is absolutely ridiculous and contrary to history. I challenge anyone to post numbers over the last 30 years showing how this has been true. I'd be more than happy to post the opposite, and all of ya who remember the difference between the 80's and 90's don't even need me to; you remember quite well...

Cycloptichorn

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Funny, the anti-American British publication you cite seems to interpret the data differently than what the source actually says, Cyclop.

Quote:

http://www.epinet.org/content.cfm/webfeatures_econindicators_jobspict_20050506

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Anti-American my ass, Fox.

What you've posted doesn't contradict the Financial Times article at all. You merely chose to look at a seperate part of the article. The fact does remain, despite your objection, that inflation grew faster than wages last year and is on pace to do so this year as well.

Let me ask you a question: do you know how they calculate the job creation numbers? If you did, you wouldn't think our economy was doing so well...

Cycloptichorn

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I'm sure you can explain it Cyclop. Go for it.

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Foxfyre wrote:

Funny, the anti-American British publication you cite

Quite surprising, to call the FT 'anti-American': here, it is generally thought to be a conservative, center-right, pro-Bush and America-friendly business paper (it's published in the USA as well).

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Well I probably exaggerated, Walter. But an awful lot of their headlines seem to be U.S. news and they sure seem to feature the worst news and not a lot of good news. And when they do give some good news they usually find a way to qualify it negatively.

But I haven't paid a great deal of attention to it lately, so I'll watch more closely for awhile.

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Foxfyre wrote:

Well I probably exaggerated, Walter. But an awful lot of their headlines seem to be U.S. news and they sure seem to feature the worst news and not a lot of good news. And when they do give some good news they usually find a way to qualify it negatively.

You've just described the New York Times.

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Ticomaya wrote:

Foxfyre wrote:
Well I probably exaggerated, Walter. But an awful lot of their headlines seem to be U.S. news and they sure seem to feature the worst news and not a lot of good news. And when they do give some good news they usually find a way to qualify it negatively.

You've just described the New York Times.

So you think, Foxfyre didn't read the source and response to which she answered? Shocked

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Walter Hinteler wrote:

Ticomaya wrote:
Foxfyre wrote:
Well I probably exaggerated, Walter. But an awful lot of their headlines seem to be U.S. news and they sure seem to feature the worst news and not a lot of good news. And when they do give some good news they usually find a way to qualify it negatively.

You've just described the New York Times.

So you think, Foxfyre didn't read the source and response to which she answered?

No, I don't think that.

(You really keep me on my toes with your interesting comma placement Walter. Laughing

)

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Quote:

Well I probably exaggerated, Walter. But an awful lot of their headlines seem to be U.S. news and they sure seem to feature the worst news and not a lot of good news. And when they do give some good news they usually find a way to qualify it negatively.

But I haven't paid a great deal of attention to it lately, so I'll watch more closely for awhile.

It's difficult to have real financial news without mentioning the US every day. And perhaps the news has been bad lately because the news IS bad.

Cycloptichorn

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I didn't read Tico's comment that way at all, Walter.

But again from the FT

Quote:

Real wages in the US are falling at their fastest rate in 14 years, according to data surveyed by the Financial Times by the Economic Policy Institute.
Inflation rose 3.1 per cent in the year to March but salaries climbed just 2.4 per cent, according to the Employment Cost Index. In the final three months of 2004, real wages fell by 0.9 per cent

I can't remember which financial mag I was reading this past week--I read bits from a LOT of them since I spend so much time in CPA offices these days--but on this very issue, the comment was that the seeming net loss in wages is due to the high percentage of entrepreneurial ventures inspired by the new tax rates. That plus freed up capital that is creating more entry level jobs than we have seen in awhile accounts for almost all data suggesting a lower than average wage.

New Mexico is seeing slower economic recovery than many other states but I see hundreds of P&Ls every year. Comparing payrolls, including individual payrolls, with the prior year, 99% of New Mexico businesses are paying higher wages now than they were a year ago or the year before that. No hourly rates are being reduced, so the difference almost has to be in the entry level sector. And most economists would say that employment even at the entry level is a good thing.

It just goes back to the old saw. There are lies, damn lies, and statistics.

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