The poor rich

[vendic]

Or the rich poor. Take your pick.

Brought to a better place to discuss the issue.

Some tax data

[Cyborg Girl]

Bloody good. They can afford it.

[vendic]

Personally I don't think workers should be taxed until they reach a good point past the cost of living.
That means they can afford food, housing, etc so it will relieve a lot of community stress.
It also ends up helping the economy as it provides more cash flow.

[Cyborg Girl]

Wait, I thought we were talking about taxes on the top 1%?

[vendic]

We're talking about a fair taxation system that doesn't trade the suffering of the bottom end for the decadence of the top.

[Cyborg Girl]

... In that case, yes, I believe we're talking about the same thing?

[vendic]

and you thought we rarely agree...

[Swift]

I suspect I could dig this out of the linked data, but all the data is based on adjusted gross income. I don't recall what this includes; for example, does it include capital gains income, which accounts for a lot of higher income earnings, and is taxed at a lower rate.

[geonuc]

I'm confused. What exactly is the discussion?

[vendic]

This is how the discussion started, with the link and this post:

Food for thought. How much is a fair share of taxes? One of the things we hear a lot is that those in the upper income brackets should pay a fair share of taxes. Is paying almost 38% of all the income taxes paid a fair share? That's how much the 1% top earners paid in income tax in 2013.

I responded:

People usually miss the part about cost of living expense. Tax is how society takes care of it's own. When you tax low income earners without taking into account the cost of living, what is happening is a syphon up effect. Where the poor are sacrificing themselves and their children to pay tax for the purpose of supporting those better off than them. That makes no sense.
When you remove the cost of living from income and then see how much each person pays in tax relative to that, it is always the bottom 50% that pay far more percentage wise. Usually to obscene amounts.
But, it's more convenient to ignore that and point out how people that can afford to live well pay more taxes than those who's suffering allows society to flourish.

It went further on, then I posted that discussing politics on facebook is like discussing romance in a brothel, but was willing to go to a different forum to discuss it further. And here we are.
That's the short of it.

[geonuc]

Ah, OK. I imagine the 38% figure is of adjusted gross income. What is the percentage of gross income, do you suppose?

And you're right, the question ignores the need for a minimum tax-free floor.

38% is about fair, I'd say. But I'd also eliminate mortgage interest and child deductions, and make investment earnings (capital gains) fully taxable as regular income.

[SciFiFisher]

For clarification. (since I started this on Facebook) the 38% number is essentially the percentage of all the taxes paid. So, in essence for $1 of tax collected the 1% are paying 38 cents of all taxes paid. This is not the actual percentage of their income. According to the data that is actually about 7%.

Some interesting factoids; to be considered part of the 1% you only need to be earning a gross income of about $350,0000 per year. Still a lot more than most people but not as much as you might expect. If you really were earning that much and living in San Francisco for example you might not be as wealthy as you think.

The original question I posed is "what is a fair share"? If you look at the data the top 20% of earners are paying about 50% of all the taxes collected. The bottom 50% are paying less than 20% of all the taxes collected.

If you look at factors like adjusted gross income, tax breaks, and etc the average person with any kind of reasonable tax knowledge only pays about 7-15% of gross income in taxes.

Those on the lower end of the scale actually make more money than they pay in taxes due to things like earned income credit and other tax credits available to the lower incomes.

So, the original question that started this is "what is a fair share taxes?"

[SciFiFisher]

Here is the data referenced: Tax Foundation IRS Data

Key Findings
In 2013, 138.3 million taxpayers reported earning $9.03 trillion in adjusted gross income and paid $1.23 trillion in income taxes.
Every income group besides the top 1 percent of taxpayers reported higher income in 2013 than the previous year. All income groups paid higher taxes in 2013 than the previous year.
The share of income earned by the top 1 percent of taxpayers fell to 19.0 percent in 2013. Their share of federal income taxes fell slightly to 37.8 percent.
In 2012, the top 50 percent of all taxpayers (69.2 million filers) paid 97.2 percent of all income taxes while the bottom 50 percent paid the remaining 2.8 percent.
The top 1 percent (1.3 million filers) paid a greater share of income taxes (37.8 percent) than the bottom 90 percent (124.5 million filers) combined (30.2 percent).
The top 1 percent of taxpayers paid a higher effective income tax rate than any other group, at 27.1 percent, which is over 8 times higher than taxpayers in the bottom 50 percent (3.3 percent).

The data seem to support that the "rich" are paying their "fair" share of taxes if looked at as a percentage of all the revenue collected by the IRS for federal income tax.

[geonuc]

For clarification. (since I started this on Facebook) the 38% number is essentially the percentage of all the taxes paid. So, in essence for $1 of tax collected the 1% are paying 38 cents of all taxes paid. This is not the actual percentage of their income. According to the data that is actually about 7%.

Thanks for clarifying.

So, the original question that started this is "what is a fair share taxes?"

I think the current rate structure is fair, or close enough. As I mentioned above, the changes I would make would involve making more income taxable under those rates.

[vendic]

I think the current rate structure is fair, or close enough.

I don't.
The problem is the definition of fair.
Limiting the scope of fair to taxable income percentages is completely arbitrary and has no relation to actual fairness but gives the illusion of a figure that people can falsely relate to.

The other problem is that we refuse to accept any realistic indicator of how fair the system is over time.
So let me throw this out there. The USA gives people opportunity because it is a collective of people called a society. Everyone in that society contributes to it. How much we take for ourselves from that collective contribution is the true measure of how fair the system is.
When I say contribution, I mean all of it. Not just money. People contribute labor, they contribute their lives to the society we live in and many lose their lives as part of that contribution.
Now lets see how the taking of the contribution is working out.

The Waltons, the family that owns Walmart, while paying employees so low wages that the government paid the difference through the tax system, made their money. How much did of society's contributions did they take for themselves?
They took as much as the lower 40% of Americans have.
Five people in the USA all members of one family took from society more than the lowest 40% of Americans and while they were doing it, they underpaid their workers, many in that very 40% so little that the government had to offset their tax due to low income.

If that isn't insulting enough, we also get these same people then complaining how they get taxed too much while the lower 50% get taxed little.

The result is that they make the disparity, they make poor people, they force society to care for the poor that they are creating an then complain that the poor had it too good. It's not just that one family either. Put a few more families in there and they collectively own an obscene percentage of the wealth of this country.

That does not sound like a fair system to me.
Any system that allows one family to accumulate as much wealth as 40% of the country has a serious issue in fairness. What it is telling you is that your workers are not being paid enough and the wealthy are getting the benefits of society at the expense of the working class. There is no other way around this. If anyone wants to know how the taxation system's fairness is working out, you have your measure. All you have to do is look at it and use it in the calculations.
If the trend does not change, the USA will get into a situation where the majority of the people are poor while the minority are living a live of decadence at their expense. Then there will be a tipping point. Then there will be a complete system reboot from the ground level build on a foundation of blood.
Maybe that, is fair.

[SciFi Chick]

It seems to me that most of the time, in these discussions, everyone uses the poor little guy that's only making $350,000 a year as the benchmark for whether or not things are fair. I would say they're getting screwed over as well, but not like the ones at the bottom. The real problem is the .1% not the 1%.

In other words, talking about whether the person making $100,000 or $350,000 is getting screwed over and using that as a basis to tax the people at the bottom is the wrong attitude. Almost all of us are at the bottom. But the people at the top are really taking advantage, and that's where the ire needs to be directed.

It's not the people on welfare that are taking money out of your pocket. It's the people that own Walmart. It's the Koch brothers. It's the people at the very top, but everyone, as soon as they start making money and getting into a new tax bracket, instantly complain about the people at the bottom. Brainwashed much?

[vendic]

I've never understood that mentality. When you are earning $300,000 p.a. you are basically equivalent to a flea on the ass of camel working for it's owner till it's ready for slaughter. But as soon as you get that "flea" status, you complain about the mites taking all the blood. W.T.F.

Oh, here's a bit of trivia for you all.
In 2007 the Walton's had as much wealth as the lowest 30% of Americans. The ones that slave to keep society functioning and the ones that died to keep the "freedom" of this country and the ones who lost limbs doing so begging on the streets. When you complain about the welfare class, these are the people you are talking about.
In 2010 the Walton's had as much wealth as the lowest 40% of Americans.

That 41.5 percent represents nearly 49 million families, notes Josh Bivens at the left-leaning Economic Policy Institute. While median family wealth fell by 38.8 percent, Bivens wrote, the wealth of the Walton family members rose from $73.3 billion in 2007 to $89.5 billion in 2010, or about 22 percent growth.

22% wealth growth in 3 years for the Walton's, 38% drop in median family wealth in the same time, and, people complain about the welfare class. This is not brain washing. It's willful delusion.

Here's my advice. Forget global warming. That's not the immediate threat. It's high time to avert this wreck that's about to happen and it's been long overdue. When you have that sorted, you may have enough of a voice to do something about global warming. Right now, a few families control your government and you can protest all you want but your leadership is compromised and it will do little good.

[vendic]

If I haven't made a point yet, here's some data for you all: wealth percentages

Wealth inequality in the US is at near record levels according to a new study by academics. Over the past three decades, the share of household wealth owned by the top 0.1% has increased from 7% to 22%. For the bottom 90% of families, a combination of rising debt, the collapse of the value of their assets during the financial crisis, and stagnant real wages have led to the erosion of wealth.

The gap is growing. Something will break. It's just a question of when and how.

[Swift]

The gap is growing. Something will break. It's just a question of when and how.

Yes, the gap is growing and I agree, that is the most telling indicator of a problem. And yes, I think at some point, something will break, it is just a question of when and how.

But I don't think it will be any time soon. I think it will have to get a lot worse before it gets better. I'm a child of the 60s and that was a time one thought the revolution was coming. There were some revolutionary changes (the Civil Rights movement, for one), but ultimately it ended up being more of a step change than a revolution (IMO). Big changes, but not an overthrow of how society worked.

I think the average person is a lot more tolerant of crap and oppression than maybe is widely appreciated. The growing wage gap is a slow, long-term change, and I don't think it has enough activation energy (if I may use a chemical term), to trigger a revolution.

Maybe the best analogy in recent times is the Great Depression. But that was a rather sudden event, and with much more drastic results (bread lines, 30% unemployment). And yes, you had riots and protests, and yes, you had some drastic societal changes (The New Deal).

As big as the downturn was in 2008, it really didn't change anything, and if anything, things are worse now.

[vendic]

The MIL was looking for work. She is an degree qualified accountant with a very good level of experience and 40 years of it. A very keen employer (not sarcasm) has made her an offer. $15ph. This is a bit less that her previous job. It's getting less every year. That's about $30k p.a. for an experienced accountant.
Large numbers of people live week to week. Imagine that, $30k. Imagine what people without degree's get. People are overly stressed.

I agree 100% that there needs to be a trigger. The problem is not the trigger, it is that society is already primed.
The more stressed people are, the closer to living on the edge they are, the smaller the trigger needs to be.
What the trigger will be is irrelevant. When it will be is irrelevant.
The problem is that all it will take is a trigger and, no one knows when that is coming or what it will be and no one is interested in unloading the gun.

[Swift]

The problem is that all it will take is a trigger and, no one knows when that is coming or what it will be and no one is interested in unloading the gun.

I don't even think it is that those in power are not interested in unloading the gun. I think it is that those in power think that either it will cost them too much in the short term to unload the gun, or that they can survive the gun going off, or that the gun will go off after they are dead and so they don't care (and those are inclusive or's).

[vendic]

Actually, you're probably right.

[grapes]

So, the Zuckerburgs have announced they will give away 99% of their wealth (someday), which seems to mean they keep (scribble scribble) a paltry $500 million

[SciFiFisher]

So, the Zuckerburgs have announced they will give away 99% of their wealth (someday), which seems to mean they keep (scribble scribble) a paltry $500 million

Well, sort of. But, the good news is that the Zuckerberg's and the Gates are a growing phenomenon among what I consider to be the "new rich". A significant number of these billionaires are pledging to give away at least 50% of their wealth for "worthy causes."

[vendic]

So, the Zuckerburgs have announced they will give away 99% of their wealth (someday), which seems to mean they keep (scribble scribble) a paltry $500 million

Well, sort of. But, the good news is that the Zuckerberg's and the Gates are a growing phenomenon among what I consider to be the "new rich". A significant number of these billionaires are pledging to give away at least 50% of their wealth for "worthy causes."

Yeah, it's kind of like a bank heist.
It was a team effort fella's and it couldn't have been done without you.
So how about, 50% for me and 50% for the rest of you.
What's not fair about that eh?