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Old 06-01-2013, 04:27 PM   #61
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So you argue that the price of a Peppermint Mocha Vente should be progressive; subject to the status of automobile you pull up to the drive thru window in?
You recommend a form of commerce in which shoppers present their bank statement to the Kroger cashier prior to checking out so proper adjustments can be made to their cart of groceries and sundries?

In the name of fairness of course.
It's as if you're purposely dense.

Let's walk through this step-by-step and I'll use the average numbers here: How The Poor, The Middle Class And The Rich Spend Their Money : Planet Money : NPR which outline how Americans (low/middle/upper class) spend their money.

Say that the state imposes a total 20% income tax (aggregate % accounting for both state and federal taxes). What does that mean for a poor family (defined as having household income of <$20K? It means that they are paying $4K in taxes. According to the data above, such a family also spends an aggregate of 14.9% of its income on food (groceries + restaurants) for a total of $2980 per year and 29.2% of its income on housing for a total of $5840 per year and 11.1% of its income on utilities for a total of $2220 per year. So if we just look at the NECESSITIES OF LIFE, meaning shelter and food and add the mandatory flat tax to it, this family is left with a grand total of $4960 for the whole year. With that, they need to pay for gas and transportation, health and medical expenses, school expenses for any children they may have, daycare, entertainment, CLOTHING (which should be a necessity but I didn't want to count it in case you were going to argue that they spend disproportionately on nice clothes), etc. Nevermind that I didn't even account for consumption taxes which would be applied on items such as food and clothing.

Now take somebody like me. With our household income, if you proposed a 20% flat tax, I would pay about HALF in income tax as I pay now. Practically speaking we are talking about some $80-90K less in taxes than I pay now. Great! Sounds like a deal. And you know what we'd do with that? Not open a business or hire people or go out and buy, buy, buy (George W. Bush's idea of how to battle a shitty economy). We'd put it in the stock market, utilize the even lower capital gains tax rate and get off like bandits.

So when the system becomes untenable, as ours will shortly and as yours would even more quickly, then we start to talk about cutting the social safety net and raising the retirement age. From 65 to 67, maybe to 70, 72, 75. We can't afford to have all these people retired and relying on benefits, and now that you've cut revenues from the upper classes and the government is broke, you need the people to keep working, longer and longer. And guess who doesn't give a shit about the retirement age being raised? People in the upper class whose taxes you just cut, who got away like bandits for decades and who are going to have their feet up at 60 and not standing hunched over working as greeters in Walmart until they're so decrepit that we take mercy on them.

The flat tax idea is supremely inequitable because it is not about who pays the most in TOTAL taxes, it is about how individuals allocate and spend their income and what proportion of one's income is going to get eaten up by taxes. You can arguably make a flat tax rate society more equitable by allowing significant deductions and exemptions to the poor so that they have $ returned to them at the end of the year and the rest of us do not. But I bet that you have no interest in that structure.

If I was a really, really selfish person, I'd love to live in your world.
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Old 06-01-2013, 05:35 PM   #62
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Anitram, you are/were a lawyer, right? Should I go to law school?
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Old 06-01-2013, 06:00 PM   #63
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Wouldn't it be fun to go back and find all the posters here blaming GWB for the abuses at Abu Ghraib because of his "cowboy" mentality in running the war and the people he put in key positions.
Methinks you were one those defending Dubya.

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You know, back when we thought "the fish rots from the head" and "dissent is patriotic."
Sound familiar?
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Old 06-01-2013, 06:27 PM   #64
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You miss the point so clearly one could almost suspect you of doing it intentionally.
4) _________________________________

I was still waiting for your who's to blame for the IRS debacle.
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Old 06-01-2013, 06:30 PM   #65
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Anitram, you are/were a lawyer, right? Should I go to law school?
Yes, I'm a corporate lawyer.

The answer is: depends. To be brutally honest, if you can get to into a top law school (T14 or very few/select schools below that), then you should strongly consider it. If you can only get into a low-ranked school, your career options will be very limited, you will struggle paying off your student debt (unless you are a trust fund baby) and you will be in a profession that is extremely challenging and full of very unhappy people (for many reasons).

Also, if you want to go to law school to change the world, it's probably a bad rationale that will lead to a disappointing outcome. Generally the idealism is beat out of most law students fairly early on. There are still a few out there valiantly trying, but they are few and far between.

It was very much the right choice for me and I've gotten to do some amazing things and I am really happy with my career and where I am right now. But I would be lying to suggest that all my former classmates would say the same today.
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Old 06-01-2013, 06:30 PM   #66
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Correct me if I'm wrong but I bet those so worried about the effect of a flat tax on low and middle income taxpayers have no problem with regressive taxes on alcohol, gasoline, cigarettes and state lotteries.
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Old 06-01-2013, 06:40 PM   #67
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Yes, I'm a corporate lawyer.

The answer is: depends. To be brutally honest, if you can get to into a top law school (T14 or very few/select schools below that), then you should strongly consider it. If you can only get into a low-ranked school, your career options will be very limited, you will struggle paying off your student debt (unless you are a trust fund baby) and you will be in a profession that is extremely challenging and full of very unhappy people (for many reasons).

Also, if you want to go to law school to change the world, it's probably a bad rationale that will lead to a disappointing outcome. Generally the idealism is beat out of most law students fairly early on. There are still a few out there valiantly trying, but they are few and far between.

It was very much the right choice for me and I've gotten to do some amazing things and I am really happy with my career and where I am right now. But I would be lying to suggest that all my former classmates would say the same today.
It's good to hear that someone likes where they are with a law degree, because I hear a lot of reports of misery. I have no delusions of changing the world, and the pre-law advisor at my school told me that she thinks I can get into a T10 school, so it's tempting.
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Old 06-01-2013, 06:48 PM   #68
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It's as if you're purposely dense.

Let's walk through this step-by-step and I'll use the average numbers here: How The Poor, The Middle Class And The Rich Spend Their Money : Planet Money : NPR which outline how Americans (low/middle/upper class) spend their money.

Say that the state imposes a total 20% income tax (aggregate % accounting for both state and federal taxes). What does that mean for a poor family (defined as having household income of <$20K? It means that they are paying $4K in taxes. According to the data above, such a family also spends an aggregate of 14.9% of its income on food (groceries + restaurants) for a total of $2980 per year and 29.2% of its income on housing for a total of $5840 per year and 11.1% of its income on utilities for a total of $2220 per year. So if we just look at the NECESSITIES OF LIFE, meaning shelter and food and add the mandatory flat tax to it, this family is left with a grand total of $4960 for the whole year. With that, they need to pay for gas and transportation, health and medical expenses, school expenses for any children they may have, daycare, entertainment, CLOTHING (which should be a necessity but I didn't want to count it in case you were going to argue that they spend disproportionately on nice clothes), etc. Nevermind that I didn't even account for consumption taxes which would be applied on items such as food and clothing.

Now take somebody like me. With our household income, if you proposed a 20% flat tax, I would pay about HALF in income tax as I pay now. Practically speaking we are talking about some $80-90K less in taxes than I pay now. Great! Sounds like a deal. And you know what we'd do with that? Not open a business or hire people or go out and buy, buy, buy (George W. Bush's idea of how to battle a shitty economy). We'd put it in the stock market, utilize the even lower capital gains tax rate and get off like bandits.

So when the system becomes untenable, as ours will shortly and as yours would even more quickly, then we start to talk about cutting the social safety net and raising the retirement age. From 65 to 67, maybe to 70, 72, 75. We can't afford to have all these people retired and relying on benefits, and now that you've cut revenues from the upper classes and the government is broke, you need the people to keep working, longer and longer. And guess who doesn't give a shit about the retirement age being raised? People in the upper class whose taxes you just cut, who got away like bandits for decades and who are going to have their feet up at 60 and not standing hunched over working as greeters in Walmart until they're so decrepit that we take mercy on them.

The flat tax idea is supremely inequitable because it is not about who pays the most in TOTAL taxes, it is about how individuals allocate and spend their income and what proportion of one's income is going to get eaten up by taxes. You can arguably make a flat tax rate society more equitable by allowing significant deductions and exemptions to the poor so that they have $ returned to them at the end of the year and the rest of us do not. But I bet that you have no interest in that structure.
I always appreciate it when people spend some time with their posts so thank you.

But let me just say that eliminating the phoniness of SS and Medicare payroll deductions by lumping all federal taxes into one flat tax helps lower income families immensely.
Two, nobody said all deductions would be eliminated. Dependants, and mortgage and charitable deductions could remain in some form.
Three, two rates isn't out of the realm of a flat tax (a higher rate that would affect maybe 5-10% of taxpayers) nor is the addition of a national sales tax to capture money from underground economies.

It's something that should be looked at for two reasons:
1) Eliminate the complexity that leads to the absolute power given to the IRS which, well, you know what they say about absolute power.
2) Promote real economic growth, it's better to grow the pie than construct a bureaucracy to redistribute the pie.

What I don't understand is the knee-jerk mockery by some as if our current system is acceptable by any standard.

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If I was a really, really selfish person, I'd love to live in your world.
See above about promoting growth so more people pay the taxes you and I pay.
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Old 06-01-2013, 08:10 PM   #69
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4) _________________________________

I was still waiting for your who's to blame for the IRS debacle.
Well, following your examples of 1 through 3, I suppose 4 should be:

4) and what kind of name is Barack Hussein Obama, anyway??
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Old 06-01-2013, 09:19 PM   #70
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Well, following your examples of 1 through 3, I suppose 4 should be:

4) and what kind of name is Barack Hussein Obama, anyway??
Man, and here I was hoping you'd at least try.
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Old 06-01-2013, 10:00 PM   #71
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Man, and here I was hoping you'd at least try.
When your answer is that Barack Obama is bumbling, incompetent and yet simultaneously the master of an insidious plan to defraud the country and discriminate against those poor PACs, I don't see why I should bother.
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Old 06-01-2013, 10:16 PM   #72
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When your answer is that Barack Obama is bumbling, incompetent and yet simultaneously the master of an insidious plan to defraud the country and discriminate against those poor PACs, I don't see why I should bother.
No I didn't, it was 3 separate choices, never all the above.

I do remember arguments that GWB was a bumbling, incompetent and yet simultaneously the master of an insidious plan to get Democrats to support going to war in Iraq. I remember that.
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Old 06-01-2013, 10:28 PM   #73
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Two, nobody said all deductions would be eliminated. Dependants, and mortgage and charitable deductions could remain in some form.
Not to get too off topic but I have posted here before in pretty good detail why the mortgage interest deduction should be abolished. It disproportionately benefits the wealthy who buy expensive homes and should be done away with. What I was talking about in terms of deductions would essentially be tax credits applied to low income people to offset their disproportionate costs of consumption taxes.

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Three, two rates isn't out of the realm of a flat tax (a higher rate that would affect maybe 5-10% of taxpayers) nor is the addition of a national sales tax to capture money from underground economies.
Once you introduce multiple levels you do not have a flat tax. So you and I may not disagree in the end on this actually, it's just that one flat tax is not really workable without a tax code that corrects for some of the inequality. As for a national sales tax, that is the consumption tax that I was referring to, and there again you would need to credit the poor - such that a calculation is made to determine the appropriate level of reimbursement based on income tax levels. Recognizing, for example, that as somebody pointed out on the thread, a poor person pays the same amount for a tomato as a wealthy person and that a flat consumption tax punishes the poor person because it accounts for a higher proportion of their income (both total and disposable).

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1) Eliminate the complexity that leads to the absolute power given to the IRS which, well, you know what they say about absolute power.
2) Promote real economic growth, it's better to grow the pie than construct a bureaucracy to redistribute the pie.
Agree with the first one, no doubt.

With respect to the second, I think plenty has been written to discount it. As I said to you before, if you were to lower my household taxes by a significant amount, we'd be left with savings in the tens of thousands of dollars. What economic growth do you think it will promote if we were to get to keep an extra $50K or $100K of our income? Unlike the poor or middle classes who would likely funnel a lot of the extra savings into the economy through consumption (bigger house, new tv, new car, etc), we would rely on more advanced financial planning which would be aimed at (i) maximizing returns and (ii) minimizing taxes (remember, tax avoidance is not tax evasion and you can simplify the tax code but until and unless you agree to do away with the capital gains taxes which it's my understanding the GOP is dead set against). There was a video by Matt Damon a couple of years ago where he also put it pretty bluntly - when he and his friends were making off like bandits, not a single one of them created a job in the economy or expanded a business. It was all invested into paper money, asset-backed securities, derivatives, etc. Not exactly what you are envisioning would help keep the economy chugging or improve the lives of the middle class in the heartland.
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Old 06-02-2013, 08:46 AM   #74
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I do remember arguments that GWB was a bumbling, incompetent and yet simultaneously the master of an insidious plan to get Democrats to support going to war in Iraq. I remember that.

GWB was bumbling and incompetent, not to mention incurious and inflexible.

It was Cheney and Rumsfeld who distorted and manipulated the WMD "intelligence" and made the false link between 9-11 and Saddam Hussein.

(many of us were against this from the start, which turned out to be the correct position, and is the reason why Barack Obama was elected president. The first time. His second election was because he saved the American economy from disaster.)
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Old 06-03-2013, 01:32 AM   #75
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I remember several years back I used to support a flat tax as well.
And then I got tangled up with martina on that subject and she slapped me around.
Being that I am big fan of logic and reason, I haven't supported a flat tax since.
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