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12.20.2004
Unix, Music, and Politics ... What was I thinking? Every so often I visit Jim's blog, if for no other reason than to get the condensed version of the right wing talking points. His latest post on tax cuts is a case in point. Notice that the entire discussion on taxes revolves around income taxes. Can anyone tell me why? Because income taxes are progressive and they hit the wealthy harder than the poor. The debate is always about how the rich have to pay more in taxes so its all so very unfair. But let's turn the debate over on its head for a second and rebuild from the bottom. Per Jim's example Mary pays 27% taxes and John pays 18% taxes and the claim is that Mary is paying an unfair share of the taxes because she is taxed at a higher rate. But taking a step back we see that our current government is running an budget deficit. The most logical conclusion would be to assume that John is not paying enough taxes and the resulting call would be for taxes to be raised on the poor. Politician: "The poor are not paying their share and we need to tax them at the same rate as the rich! For the sake a fairness, we can't have these poor people getting off paying less than their fair share" Not gonna happen. It would be "fair" to lower the taxes on the rich but not "fair" to raise the taxes on the poor. But unless we cut spending (which means Bush's pet war in Iraq and the other runaway military spending.. i.e. "Missles in Space") it would be just plain stupid to decrease revenue even further. Considering the amount of wealth tranfered to the wealthy through corporate military contracts we can't expect that to happen any time soon. (There's so many aspects to the debate that are simply omitted in Right Wing talk that it effectively makes the listener dumber just by tuning in.) In their neverending quest to bring more fairness to the world the right has also decided that we should eliminate taxes on non-work income, effectively saying that people should only be taxed if they work. If you own investments then you should be able to collect that money with no tax burden. Can you tell me who owns the majority of investments? Not me, that's for sure, and before we roll out the "50% of all household's own stocks" line we should remind our listeners that 80% of all stocks are still owned by about 10% of all investers. Just because my dad has a few bucks socked away in a mutual fund doesn't mean that he is on the same level as a guy that owns millions of shares of stock worth billions of dollars. Let's not confuse the issue by trying to place little guys and big guys on the same playing field. I mean... we are trying to be "fair" here aren't we? And while we're at it let's talk about payroll taxes... Right Wing Radio: (crickets chirping) That's because payroll taxes are capped. During the entire debate about Social Security going broke and "not being there" for the next generation have we heard any talk about how we could just do away with the unfair cap on payroll taxes? Nope.. because the ease at which the rich can frame the debate is simply butter. They DO own the media after all...we seem to forget this simple little fact. The least we could do (for the sake of fairness) is to raise the upper limit on payroll taxes to make up for the gap in possible funding. But we can't do that because it would be unfair to the rich that have been paying a disproportionately low share of payroll taxes. Let's take an extreme example to illustrate my point. The cap on payroll taxes is set at $87,900. In Jim's example both Mary and John pay taxes on 100% of their work income to help fund Social Security. But let's say that Glenn makes a cool $2 million a year. He pays taxes on just his first $87,900, leaving the rest, $1,912,100 tax free. Glenn pays in about $5500, just $1780 more than Mary who makes considerably less. Glenn's effective tax rate = 0.275% Mary's effective tax rate = 6.2% John's effective tax rate = 6.2% My effective tax rate = 6.2% If you make less than $87,900 you pay 6.2% in payroll taxes. As your income goes up your tax rate plummets like a rock. A quick google search of "Payroll taxes cap" turned up numerous hits that all said the same thing "Eliminating the cap would not fix Social Security!" Which amused me, because the argument from Heritage is that this would only prolong the current system until 2024. But you see, I trust Heritage as much as a I trust my boss, because well, they ARE the same thing. Who do you fucking think funds these think tanks, who else has enough money to pay people to sit around make shit up? The prevailing logic is that we should blow a massive hole in SS but leaking money into "nest eggs" for future generations. Nest eggs gently cradled to little baby birds by our friends on Wall Street. "Remember the Great Depression!!!" I call this gambler's logic. I can justify cashing in my paycheck and gambling it at the casino instead of paying my car payment because when I hit it big I can pay my bills AND buy my girl something nice. I can justify borrowing from next week's paycheck because when I hit it big, I can pay back that loan, pay my bills AND buy something nice for my girl. The stinkin' thinkin' only makes sense if you accept the premise that anytime you ask the rich to pay more taxes they'll retaliate by sinking the economy. The Heritage data also makes the assumption that the wealthy will find ways to avoid paying the taxes. Moreover, this would be "The biggest tax increase in us history." But still just a pittance when applied to SS. Big enough to sink the economy, but not big enough to fix anything. Amazing... |
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