Paying Their Fair Share - The Myth

[rehmwa 2]

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the geographic exclusion goes a fair way towards making a fair tax more palatable.

that seems unfair, not more fair - taxing people differently


(for those that can't have a discussion that doesn't involve social manipulation - which is the reason taxes are so crappy and intricate since government has folded in all sorts of things into the code that they should just butt out of - geographic considerations like this would promote overdensification in areas that simply need relief from population pressure, not amplification.

Once again, demonstrating that good intentions via manipulation of the market by government will always have negative effects. Stop trying to play favorites, it's tearing apart the country)

If we MUST depart from this simplicity and have an initial exclusion - then keep it absolutely MINIMIZED and the same for everybody.



Kallend's got the first part right - all forms of income, in the end, is just money. Tax it all the same.

Though I'd rather avoid the emotional rant about calling it "working for a living" vs other. I know day traders that 'work' a hell of a lot harder than a lot of tradesmen that would claim they "work for a living". I don't really care how you get your income, but I'd just prefer that every dollar everybody makes is taxed the same as any other regardless of it's source or your current baseline situation for that matter. Or if it's your first dollar, or your last dollar you make that year.

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Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[wmw999 2,444]

It also adds complexity if you're someone who's moved one or more times during the year. Might not be worth the effort. I'm just thinking of the disproportionate impact on people who live in high-cost areas, performing essential but low-paid functions (like teacher , waiter, LPN, etc).

Of course, people in those places with higher incomes will also get "screwed," because without the mortgage deduction, the disparate cost of living is no longer reflected in tax structure.

Wendy P.

There is nothing more dangerous than breaking a basic safety rule and getting away with it. It removes fear of the consequences and builds false confidence. (tbrown)

[davjohns 1]

Let me see if this makes it more palatable for you...

When I went to look up 'living wage' I found that the online calculator I came to estimated it based on where you live. That makes some sense. It costs more to live in some areas than others. I would guess that pay there tends to be higher to compensate. Whether it does or not, the initial exemption I was talking about would just be an estimate of what it costs to live there. After that, the 'disposable income' would be taxed. Probably still some issues there. If you live in the Hamptons, you are likely to have a higher cost of living, so there might need to be a range to operate within.

Like Wendy points out, some people are fairly trapped by their circumstances and would find it quite difficult to move. For instance, a person who is divorced and did not get physical custody of their child would be geographically locked due to no real 'fault' of their own.

I know it just wouldnt be right to kill all the stupid people that we meet..

But do you think it would be appropriate to just remove all of the warning labels and let nature take its course.

[davjohns 1]

I would recommend that, over the long run, doing away with that particular deduction would bring down housing costs by reducing demand. Let's face it, the government gives up income with that deduction. They are indirectly subsidizing the mortgage industry. Do we really need to subsidize that? For what? So people can own a house? Let's be honest...if you own the house, you don't have a mortgage and get no deduction. If you have a mortgage, the bank has more ultimate right to the property than you do. Who really owns it?

I would prefer that deduction go away in the long run. I enjoy it now, but think we would be better off without it as a whole.

I know it just wouldnt be right to kill all the stupid people that we meet..

But do you think it would be appropriate to just remove all of the warning labels and let nature take its course.

[rehmwa 2]

you see, you get bogged down when you start picking at all the little details - details that are all examples of trying to socially manipulate things that should be guided by free choice without government attempts to control (or 'mitigate' if you will)

scrap the whole thing - no exemptions, exceptions, penalties, credits, or deductions
a single, very small exemption (or none at all). every dollar after that taxed at one rate


there's a giant adjustment as a result - no kidding. trying to manage that is also just playing favorites

let the chips fall

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Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[rehmwa 2]

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It also adds complexity if you're someone who's moved one or more times during the year. Might not be worth the effort. I'm just thinking of the disproportionate impact on people who live in high-cost areas, performing essential but low-paid functions (like teacher , waiter, LPN, etc).

so what - either the local people pay them more, or they leave to where they can afford it. The economy is a funny thing - leave it alone, and it self adjusts

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Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[wmw999 2,444]

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The economy is a funny thing - leave it alone, and it self adjusts

But like a schoolyard, it's susceptible to bullies. In the case of the economy, bullies tend to be wealthier with lots of weaklings (i.e. significantly poorer people) around them. That, to me, is a huge advantage of encouraging the existence of a middle class.

A couple of good bullies can keep the middle class down, just as an entire schoolyard can be terrorized by a bully. Yeah, the kids can band together and beat the bully, but that just doesn't happen most of the time, and it never did.

Wendy P.

There is nothing more dangerous than breaking a basic safety rule and getting away with it. It removes fear of the consequences and builds false confidence. (tbrown)

[rehmwa 2]

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In the case of the economy, bullies tend to be wealthier with lots of weaklings

I know that's dogma for many, but you can't say that like it's fact

IMHO - currently, the bullies are congress and they are being encouraged by whatever voting group they are pandering to (cynical position) - or whatever subjective social experiment they are trying to favor (position that assumes they mean well but are just idiots).

It really doesn't favor any class, but it does let congress create a lot of artificial conflict between subjectively defined groups that they can then work and cash in on.

You also noted "encourage a middle class" - again that nasty habit to want government to experiment socially along subjective lines - well meaning of course . IMHO - a middle class will always be there, with or without 'encouragement' by uncle sam. Probably would be there much easier if he just stops picking at it.


Edit: here's the test - you have 20 people and you know nothing about them. You can't see them, you don't know what they do, what they make, where they are from, what color they are, gender, etc etc etc. Now, go make up a set of rules for them that's direct, doesn't have a lot of if/then statements. If you look at those rules, and it doesn't seem 'fair' at that point, then it's too complicated. Any caviat that points at "this demographic", "that social strata", etc etc is by definition unfair and unequal treatment.

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Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[wmw999 2,444]

Bullies are in congress, but they are also people with wealth who use it as a tool to exert undue power over others, particularly employees.

Yeah, you say, employees always have choice. In a good economy with plenty of jobs, particularly non-specialized ones that someone can shop around for.

I'm not particularly a unionist; I think their time has passed in many cases. But it doesn't take long to remember a decent number of ridiculous-treatment cases, up to and including the recent fire in Bangladesh. And before you say "but that's overseas," consider recent coal mine explosions, as well as the Hamlet chicken processing plant fire (1991). There are plenty of contemporary accounts in the US of domestic and construction worker abuse -- those are small-scale, but do you really think that the responsible parties for those would consider it to be bad to extend the same treatment to others in their power if htey could?

Power corrupts, and in a society where money conveys power, then it corrupts, too. Not a problem necessarily, but it does need to be kept in mind, and bullying kept in some sort of check.

Wendy P.

There is nothing more dangerous than breaking a basic safety rule and getting away with it. It removes fear of the consequences and builds false confidence. (tbrown)

[rehmwa 2]

I see your point - you are isolating just one group that abuses power that you are focused on, but you are missing mine. I don't care where the political bullying comes from (the subset of corrupt rich, well meaning zealots with ideological agendas, etc etc etc, I acknowledge that they come from anywhere, and abuse of power for the sake of getting special treatment is wrong regardless of the origination), it's not a matter of finding just one target group and ganging up on them. It's a matter of cleaning up the rules.

In the end, the rules are made by congress, and special tweaks are never in terms of 'fairness' but always about preference. that should be limited to a very severe extent. a good start is an extremely simple and one size fits all tax code.


The philosophy of "they get their special rules, so I want my special rules" is pointless and propogates/exacerbates the problem. the philoshophy of "they get their special rules, let's delete those special treatments" is a better fix.


Kallend is very close with "they get their special rules (low taxes on investment income), let's delete those special treatments........except where it might hurt some other group that I'm favorable to, let's keep treating them special" close, but not close enough. Then the discussions become less about just eliminating the special treatment, and more about social manipulation of just another kind.

but, a lot of people think government's role really is social manipulation of whatever they like.....

(though i really hope the trite/obtuse response of "But, you do want government to treat groups differently, you don't want murderers treated the same as you, do you? HUH? DO YOU?" but he's not posting today for some reason)

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Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[kallend 2,026]

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It also adds complexity if you're someone who's moved one or more times during the year. Might not be worth the effort. I'm just thinking of the disproportionate impact on people who live in high-cost areas, performing essential but low-paid functions (like teacher , waiter, LPN, etc).

so what - either the local people pay them more, or they leave to where they can afford it. The economy is a funny thing - leave it alone, and it self adjusts

Agree - if you choose to live in a nice place with a nice climate, that's your choice. If you don't like the cost, go live in Detroit or Toledo.

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The only sure way to survive a canopy collision is not to have one.

[kallend 2,026]

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Kallend is very close with "they get their special rules (low taxes on investment income), let's delete those special treatments........except where it might hurt some other group that I'm favorable to, let's keep treating them special"

I don't want to treat anyone "special" based on the source of their income, or where they live, or how big their mortgage is, or what church they tithe to.

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The only sure way to survive a canopy collision is not to have one.

[billvon 2,990]

>Great. So we can put you down as supporting a flat tax and eliminating all deductions?

I'm perfectly fine with a flat tax starting above the poverty line. Sure, remove all deductions. (Just to be clear, that means removing tax deductions for soldiers serving in combat zones, ending tax-free or tax-reduced retirement accounts etc.)

[davjohns 1]

Just for clarification, Soldiers in combat zones aren't taxed. It's not a deduction. Not arguing the legitimacy. Just clarifying.

But still...that's kind of cold...

I know it just wouldnt be right to kill all the stupid people that we meet..

But do you think it would be appropriate to just remove all of the warning labels and let nature take its course.

[billvon 2,990]

>Soldiers in combat zones aren't taxed. It's not a deduction.

So it's a tax credit? (i.e. you don't need to pay taxes at all on that income)

[rehmwa 2]

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>Soldiers in combat zones aren't taxed. It's not a deduction.

So it's a tax credit? (i.e. you don't need to pay taxes at all on that income)

sure - another example of special treatment on those dollars. STOP IT


clear example of why this is VERY hard to do - some special treatment is MUCH more popular than others. that's why a clean slate approach is likely the only one that fixes the problem rather than just be more exercises in special treatment policies

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Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[DiverMike 5]

OK - How do you feel about 'use tax'. Should over the road truckers have to pay a road tax on top of whatever flat tax you come up with because they are causing more damage to the resource we are maintaining with tax dollars?

For the same reason I jump off a perfectly good diving board.

[billvon 2,990]

>sure - another example of special treatment on those dollars. STOP IT

"No deductions or tax credits" is a worthy goal, and I'd support that effort. The problem is that every person who I've talked to (with the possible exception of you) has a caveat. Sure cut everything except . . .

[Fast 0]

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you see, you get bogged down when you start picking at all the little details - details that are all examples of trying to socially manipulate things that should be guided by free choice without government attempts to control (or 'mitigate' if you will)

Everyone seems to forget that the great life you have is in many cases because the government started manipulating things. Point in case:
http://en.wikipedia.org/wiki/Democratic_Republic_of_the_Congo

A recent documentary news broadcast I was watching described it as one of the areas of africa that has the most resources that it could take advantage of. The area is devastated as a result of a lack of control. Everything there comes down to who can take what they want and force others to deal with it. It's the concept of the bullies that has been brought up already in this thread.

All of this stuff is subject to "everything within reason." I accept that a flat tax rate could be livable. The bottom line though is that there are going to be exceptions to every rule. Taxing someone who is in poverty, living on food stamps doesn't make sense, cause the money is going to be given back to them. It causes inefficiency which in the long run costs us more. The government has not kept up with the changing picture of the world.

Using tax incentives, stimulus, etc to encourage social trends is a needed function of the government. The problem is that these things stay in place when the problem is solved. It's led to a very complex set of laws that are ripe for the picking by people who want to game the system.

Things do need to be simplified, but adjustments for good social policy should come with it. It's not practical for us to say that the free market will do what it needs to, just tax everyone the same and hope for the best. People who have a demand for welfare to go away, super limited government, etc don't really ever want to admit the truth. Short of removing the people from society who are no longer able to take care of themselves or able to sustain life above poverty (imprison them, kill them, lock them up in ghettos) we have to do something.

I have said this in other threads, life needs to be simplified, things need to be adjusted. There is so much inefficiency in what we are doing and how things operate that it's out of control.

The definitive perfect solutions to a lot of these things are not happy and are not things people would ever be willing to do and involve taking away a lot of individual rights. I don't think that is where we want to go as a society.

The first step is doing what we can to simplify the problems, tax code, laws, etc. Then from there work towards keeping that simplicity as things move forward.

We need people that say "what does society as a whole need, lets make that happen", which I think is what these politicians are trying to do. The problem is that the politics of it all are kinda stupid. It's driven by money not by social responsibility. It's driven by corporations and capitalists who want to see ever increasing profits, politicians that want to stay in office rather than help people, greed.

Solve that problem and the rest will follow.

~D
Where troubles melt like lemon drops Away above the chimney tops That's where you'll find me.
Swooping is taking one last poke at the bear before escaping it's cave - davelepka

[rehmwa 2]

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>sure - another example of special treatment on those dollars. STOP IT

"No deductions or tax credits" is a worthy goal, and I'd support that effort. The problem is that every person who I've talked to (with the possible exception of you) has a caveat. Sure cut everything except . . .

it's difficult isn't it?

the only "fair" solution, I guess, will be the one that upsets everybody


if someone makes $100,000, and has $20,000 in deductions and pays 25% income tax would pay ( (100,000-20,000) x .25 ) = $20,000

I suspect if we could just start with no deductions and a 20% tax rate, then maybe people would figure out that this is a giant shell game that really does just take money from the middle class and gives it away to the very rich and the very poor in trade for votes and power.

Edit for those more obtuse to see it without a narrator: math on the "if" statement ((100,000 - 0) x .20) also equals $20,000

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Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[kallend 2,026]

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OK - How do you feel about 'use tax'. Should over the road truckers have to pay a road tax on top of whatever flat tax you come up with because they are causing more damage to the resource we are maintaining with tax dollars?

Call it a "User Fee" and the tax name problem is solved.

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The only sure way to survive a canopy collision is not to have one.

[billvon 2,990]

>the only "fair" solution, I guess, will be the one that upsets everybody

Well, as long as it upsets everyone exactly equally, I suppose . . .

>I suspect if we could just start with no deductions and a 20% tax rate, then maybe
>people would figure out that this is a giant shell game that really does just take money
>from the middle class and gives it away to the very rich and the very poor in trade for
>votes and power.

You could do that - although now you have just switched to a shell game that takes money from the middle class and poor and gives it to the very rich in trade for votes and power.

[rehmwa 2]

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>You could do that - although now you have just switched to a shell game that takes money from the middle class and poor and gives it to the very rich in trade for votes and power.

You're trying to make a statement relative to the status quo, not the point

for that matter - If you cogitate a little more, you agree it pretty much takes the shells away and certainly wouldn't help the rich if they have to pay the same on investment income like every other kind of income. But also not the point. Point is a simple set of rules everyone lives by.

My opinion on the "short term" outcome? I'd think the net winners would be the working middle class but not by showing preferences, but by having the same rules in place for all. So my personal bias is that today middle class is being screwed over by both ends. But I'll admit it's just my personal and subjective bias.

the goal should be to take the shells away - not to benefit the middle class explicitly - but someone will still make a class warfare debate out of it - even when the goal is to get away from that very pointless discussion

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Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[kelpdiver 2]

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Meanwhile, is there any room for agreement?

What if there were a per capita exclusion, after which a flat tax applied? The basics of life would be covered by the exclusion. I could go for it being variable depending on geography. Some places cost more to live than others. Although, I tend to think that if you can't live someplace, you should try to move. I would also balk at having an exclusion that took into account such voluntary issues as marital status, children and the like. I would prefer government stay out of the family.

So, what if the first $30,000USD or so was tax exempt, and everything over that amount was...17% or so? Play with the numbers any way you want. It's just a concept.

Well, are we looking at the current lame duck Congress, or the not terribly different one coming in late next month?

I think if you can presuppose that they want to be reasonable and get the job done, this method of limited deductions good garner traction. But as I wrote much earlier, the details matter. Setting the threshold at a value like 30k makes it clear that the intent is to hit big city populations.

Lest anyone repeat that Californians and New Yorkers seek special treatment here...nonsense. Their disproportionate level of savings from the mortgage deduction for wildly overpricing housing is more than offset by their disproportionately high level of income taxes paid on corresponding inflated salaries. It would be highly unfair to remove the benefit of the high cost of living while maintaining the negative.

Though one more housing boom and the average home price (including condos) in SF will cross over a million and the interest limit will start to apply. Like every other piece of tax code, inflation is never written in, so most legislation start to rot after 10 or 20 years.

[rehmwa 2]

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>The problem is that every person who I've talked to (with the possible exception of you) has a caveat. Sure cut everything except . . .

WHAT??!! If you delete the mortgage deductions thousand of real estate agents will be put out of work.

If that happens, then thousands of car accidents will be avoided (due to terrible real estate agent drivers running lights, speeding and driving while digging around in boxes in their back seats while driving) over the next decade further putting body shops out of work.

why do you hate hard working car shop employees and their sick and needy children?

won't someone please think of the children?

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Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants