NationStates Jolt Archive

I like this article (http://slate.msn.com/id/2108201/). In it, Steven Landsburg, writing in Slate (not exactly a pro-Bush website,) exposes the patent unfairness of Bush's tax cuts. Of course, he also tears down the myth of the "HUGE tax cuts for the top 1%." Go ahead, read it...dispute it, if you can.

It wasn't loading but I'm interested in reading it.

Always ready to please a curious reader.
http://slate.msn.com/id/2108201/
Bush's Tax Cuts Are Unfair ...
To the rich.
By Steven E. Landsburg
Posted Thursday, Oct. 21, 2004, at 4:20 AM PT

The Bush tax cuts (which Congress just voted to extend) are an affront to the most fundamental principles of fairness. They are skewed in favor of those who already pay less than their rightful share of taxes and shift the burden even farther onto the shoulders of the most overtaxed. In other words, the Bush tax cuts are unfair to the rich.

I know there's a lot of hype to the contrary, but look at the numbers. If you and your spouse have a taxable income of $60,000 a year, you've had almost a 24 percent income tax cut since President Bush took office. (And ditto if your income was just $20,000.) Meanwhile, the folks who make $350,000 a year got a cut of only about 12.5 percent; those who make $1 million a year got an even smaller cut.

Pre-Bush, the $1 million a year couple paid 33 times as much as the $60,000 couple; today they pay more than 38 times as much. Here's (http://slate.msn.com/id/2108201/sidebar/2108202/) the big picture:

Overall, the biggest percentage cuts went to the poorest of the poor (those with incomes in the $10,000 range) and the next biggest to those making about $60,000. After that, with some minor dips up and down, the relative size of your tax cut falls off as your income rises.

That's if you pay taxes only on ordinary income. But what about capital gains, dividends, and inheritance—the cuts that supposedly skew the gains in favor of the rich? Well, let's throw all those changes in, and while we're at it let's include changes in the child-care tax credit, the earned income tax credit, the alternative minimum tax, and payroll taxes for Social Security and Medicare.

Here's (http://slate.msn.com/id/2108201/sidebar/2108203/) what we get. The biggest percentage tax cut—about 17.6 percent—went to taxpayers in the second-lowest quintile, that is to taxpayers with below-average incomes. After that, the size of the tax cut falls off as you move from the lower middle to the middle middle (12.6 percent) to the upper middle class (9.9 percent). It rises again slightly for the top quintile, but only to a little over 11 percent.

Moreover, if you break that top quintile down into finer pieces, you discover that the super-rich weren't treated much better than the near-super-rich—and certainly no better than the middle class. If you were in the top 20 percent of taxpayers, your tax cut was about 11 percent. If you were in the top 1 percent, your tax cut was still about 11 percent. And if you were in the top one-tenth of 1 percent? Then you got about a 12.7 percent cut—almost exactly the same as the median taxpayer.

Well, you might say, at least everyone got a tax cut. But that's true only under a ridiculously literal interpretation of the term "tax cut." In fact, federal spending has increased dramatically under President Bush (with only a small fraction of that spending attributable to the war). Sooner or later, somebody's going to have to pay for all that spending, which means that just as the president's been cutting the taxes of today, he's been raising the taxes of tomorrow.

And who's going to pay those taxes? The "cuts" of the past few years have established a precedent that in the future the rich will bear a larger share of the burden than they bore in the past. Thanks to the president, the tax code is more progressive now than it's been in recent memory, and that's a hard sort of change to undo. We got where we are by cutting taxes mostly for the poor and the middle class; to reverse that, you'd have to raise taxes mostly on the poor and the middle class—and think of the outcry that would cause.

So in the not too distant future, most of us will be paying higher taxes, but the rich will be paying a larger share of those taxes than anyone would have expected before the Republicans came to town. How should we feel about that?

My own opinion is that the rich already pay too much—it seems patently unfair to ask anyone to pay over 30 times as much as his neighbors (unless he receives 30 times as much in government services, which strikes me as implausible). If you share my sense of fairness, you'll join me in condemning the president's tax policy.

But if, on the other hand, you believe that the tax system should soak the rich even more than it already does—or, to put it more genteelly, that the tax system should be more progressive than it already is—if, in other words, you are a mainstream Democrat—then George W. Bush is your guy.

Steven E. Landsburg is the author, most recently, of Fair Play: What Your Child Can Teach You About Economics, Values, and the Meaning of Life. You can e-mail him at...

Yah know, there wasn't too much that I disagreed with in that article. The only thing I don't like is the 10% tax bracket. Those people tend to need all the money they can get and most of them wern't paying taxes before the new tax bracket. On the flip side, I think that people making over a certain amount (say 5 million as ana arbitrary number) should be taxed around 80%.

Uproar, probably. But think about it for a moment. A lot more money enters into the government tax system to pay for things like social security, medicare, medicade, etc. . .

Unfair to the rich people? Yeah. But then again, would it really cut into their life style if they made 1 million a year instead of 5 million? There is a point where people make too much money and just waste it. It could be used for other more beneifical things.

I like this article (http://slate.msn.com/id/2108201/). In it, Steven Landsburg, writing in Slate (not exactly a pro-Bush website,) exposes the patent unfairness of Bush's tax cuts. Of course, he also tears down the myth of the "HUGE tax cuts for the top 1%." Go ahead, read it...dispute it, if you can.
Soooo if you were making $60,000 per year, you get a $15,000 tax cut? Yeah right.

If you were making $20,000 you got a $4,000 tax cut. What a pile of BS.

Try not to use the spin cycle?

http://taxpolicycenter.org/TaxModel/tmdb/Content/GIF/T03-0193.gif


You can do better Panhandlia?

Now perhaps this chart will put everything in the proper perspective?

http://jec.senate.gov/democrats/charts/bush_tax_dist.gif

Actually voters should check out the rest of Bush's failed economic/domestic fiscal policies:

http://jec.senate.gov/democrats/ber.htm

Spin those numbers for awhile? :eek:

Now perhaps this chart will put everything in the proper perspective?

http://jec.senate.gov/democrats/charts/bush_tax_dist.gif

Actually voters should check out the rest of Bush's failed economic/domestic fiscal policies:

http://jec.senate.gov/democrats/ber.htm

Spin those numbers for awhile? :eek:I clicked on this thread basically wanting to post the same arguement but you beat me to it, sure it sounds like the rich are getting the shaft if you just show percentages, but put it in dollar figures and it takes on a whole new look.

I clicked on this thread basically wanting to post the same arguement but you beat me to it, sure it sounds like the rich are getting the shaft if you just show percentages, but put it in dollar figures and it takes on a whole new look.
Well that column by Slate is totally dishonest and so is the person who would suggest that there is any truth in it?

**sigh** The author of the article even used my favorite line "Unless the rich get much more in the way of government services, they shouldn't pay more than the poor"

Gads. Does it mean I'm a socialist because I think those who could easily burn 10,000k a month on a bonfire and not notice a difference in their finances, should take up some of the burden of helping those who can't feed or house themselves even with their *@$! jobs?

Does it? If it does, sign me up. I'm tired of feeling marginalized in this world because I don't think the already obscenely wealthy should be given all of the poor's money too.

The system that society has created has been giving the hardworking person less and less and the CEOs more and more...for doing what? US industries are the most productive the world has ever seen, and the US worker takes less vacation than any other nation's workers, even Japan! The corporate scandals of Enron, Tyco, Worldcom, and all those others certainly don't indicate to me that the CEOs of the world need pay hikes.

I'm a good capitalist. I spend more than I take home, I pay my taxes without complaint, I don't get special government services, and if I live beyond 55 I'm F***ed because I've got nothing in my retirement package. No one, NO ONE is gonna make me feel sorry for the rich because they hafta count all their money. If you want to live tax free when you're rich, move to another nation. I'm too busy being tired, poor and hudling with the rest of the masses.

Well that column by Slate is totally dishonest and so is the person who would suggest that there is any truth in it?

Not only that, but the rich have certain benefits available to them to shelter their taxable burden that the middle class and the poor do not have. Additionally, many of the rich make a large portion of their money from capital gains, which are taxed at a much lower rate. Basically, if you do no work yourself, but funnel money in to things, you'll make a lot of money, but not be taxed on it. When you factor in total profic, rather than just income, the rich pay a much smaller burden than the rest of the country.

Absolute numbers are terrible metrics for measuring tax cuts, using percentages is the only fair way to assess the tax cut for all brackets.

If the tax code got any more "progressive" the redistribution of wealth will become outright theft, much like the US tax system from 1940 to 1980: http://www.stanford.edu/class/polisci120a/immigration/Federal%20Tax%20Brackets.pdf

Then again, even when you use percentages to assess the tax cuts, keep in mind, 0% of $0 tax liability is $0. The graph posted by the JEC Democrats is totally misleading.

Absolute numbers are terrible metrics for measuring tax cuts, using percentages is the only fair way to assess the tax cut for all brackets.

If the tax code got any more "progressive" the redistribution of wealth will become outright theft, much like the US tax system from 1940 to 1980: http://www.stanford.edu/class/polisci120a/immigration/Federal%20Tax%20Brackets.pdf

Then again, even when you use percentages to assess the tax cuts, keep in mind, 0% of $0 tax liability is $0. The graph posted by the JEC Democrats is totally misleading.

Using income as the only measure of the tax burden is equally specious though. The rich have many ways to make money other than take-home pay. In fact, many CEO's pay themselves a pittance in wages, but make their money on stocks and other things that do not get taxed nearly as much.

I am using percentage of income as a measure of tax burden. It is absurd to argue that the tax cut is unfair for the poor because they had a smaller net gain, especially when they have very little or no tax liability in the first place.

For people in the highest tax bracket, long term capital gains are taxed at 20% while short term capital gains are taxed at 40%. That's pretty high. The real tax burden in the US falls on people in the higher tax brackets and the low end of the highest tax bracket. The super-rich, thanks to armies of tax lawyers, pay very little taxes. For example, Teresa Kerry paid 12.6% in income taxes last year.

The Bush tax cut sidesteps the real problem, the bloated tax code.

while clarifying the details, you make my point for me.

I'm just going to say, when you're living Under the poverty level, even 10 percent is a freaking HUGE chunk of your income. Whereas going as high as fifty percent on the top say 5 % of americans is still caviar, suuuure the pool may have to be silver plated instead of gold but cmon.

How did I "prove your point"? You never even mentioned the disparity between the tax rates paid by the super-rich and the upper/upper-middle class. By the way, define "the rich". Listening to Kerry and the Democrats, you'd think anyone who makes more than $60k a year is rich.

I'm just going to say, when you're living Under the poverty level, even 10 percent is a freaking HUGE chunk of your income. Whereas going as high as fifty percent on the top say 5 % of americans is still caviar, suuuure the pool may have to be silver plated instead of gold but cmon.

Um, at that income you don't have any tax liability.

How did I "prove your point"? You never even mentioned the disparity between the tax rates paid by the super-rich and the upper/upper-middle class. By the way, define "the rich". Listening to Kerry and the Democrats, you'd think anyone who makes more than $60k a year is rich.

No, the number Kerry has used consistently is $200k a year. Show me where Kerry mentions the $60k figure and I might be swayed.

Take a serious look at the results of Bush's tax cuts and it is easy to realize that they are not even as good as they look on paper for the lower income wage earners and I do mean those making less than $200 K per year:

http://www.bushtax.com/

Rather than take responsibility for our common future, Bush has shifted costs to states and communities, who then pass them on to you. Across the country, people are seeing their property taxes skyrocket. State college tuition at 4-year schools has increased this year by an average of $579 nationwide. Half a million children have been deprived of health coverage. States and local government have cut vital services, and we’re all having to pay more for less. That’s the Bush Tax.

Bush is largely to blame for the fiscal crisis that has forced states and communities to raise taxes and slash services. According to the non-partisan Center on Budget and Policy Priorities (CBPP), “A conservative estimate suggests that federal policies are costing states and localities about $185 billion over the four-year course of the state fiscal crisis.” Bush has shifted health costs to states and forced states to pay for unfunded mandates for homeland security, election reform, and No Child Left Behind. As a result, states and communities have had no choice but to raise taxes and cut services. That’s the Bush Tax. (For details, see the link below to the CBPP report.)


Our children and grandchildren will be paying the Bush Tax. Bush promised, "I came to this office to solve problems and not pass them on to future presidents and future generations." Yet as a direct consequence of his tax policy, over six years an American family of four will take on $52,000 more in its share of the national debt. That’s the Bush Tax.


How is Bush paying for his tax cuts? To pay for his tax program, Bush raided Social Security Trust Funds and made off with $500 billion, eroding our protections for the elderly. Then he borrowed another $500 billion from foreigners, putting our future in their hands. For every $100 you got back in tax cuts, $40 was borrowed from foreigners, $20 was borrowed from Americans, and $40 was taken from Social Security.


The Bush Tax is huge – many times greater than most people’s income tax cut under Bush. For the bottom 60 percent of Americans, the average tax cut was just $304. The median tax cut for all Americans was only $470. In contrast, the average tax cut for those making over $1 million a year was $112,925.

Ahhh those generous tax cuts?

No, the number Kerry has used consistently is $200k a year. Show me where Kerry mentions the $60k figure and I might be swayed.
I believe he talks about the top 1% of wage earners, whatever level that would be?

I am really getting tired of people complaining about the common-sense notion that the rich should pay a higher percentage in taxes than those with less money.

In one way or another, this argument usually comes down to the insistence that such taxes are "unfair" because these individuals earn their massive riches, and why should they have to pay more than the average person?

Now, I am not going to argue that the rich do not earn their wealth because they often inherit it, exploit the poor, or otherwise fail to do an honest day's work. While I mean not to take anything away from what validity these arguments have, I want to point out a more fundamental truth.

The fact of the matter is that, even if wealth really is the product of personal industry, work ethic, or ingenuity, it is not -- cannot be -- the product of such things alone. If it were, then the billionaires would have done as well no matter where they lived -- Africa, Mexico... It shouldn't matter, if their wealth is solely the result of their own effort.

Of course, we know this is not true. The creation of wealth is only possible because conditions in one's country facilitate or at least allow it. And you have to admit that, even if some degree of private wealth is possible through private industry in other parts of the world, it does not nearly match the levels that can be maintained in the United States or some of Europe.

So in a very real way wealth is owed back to the country that produced it. The lifestyles of the extremely wealthy would not be possible without the government in which they reside. Moreover, it should be clear that some people benefit much more from the system in which they live than others. (It preferences, after all, just the traits we have mentioned... in a different system, different sets of people might "succeed"... so we cannot even sensibly describe it as a "fair" rat-race given certain constraints--it has its biases from the beginning. These may be neither good nor bad, on the whole... but this does not change the fact that some people benefit more than others.) Therefore, it makes perfect sense that these people owe a greater percentage of their assets to their country.

How much? I tend to think almost all of it, and I think it would be hard to support a very conservative estimate. This does not imply, however, that the government MUST tax people for everything they "owe" -- especially since there may be good pragmatic economic reasons for allowing them to keep it. But it does mean, in principle, that no one has the right to complain when their government comes calling at tax time... no matter how high their personal taxes may be.

They may argue the pragmatic point (effect on the economy, and so forth)... but I see no place for an argument from "right." None whatsoever.

Soooo if you were making $60,000 per year, you get a $15,000 tax cut? Yeah right.

If you were making $20,000 you got a $4,000 tax cut. What a pile of BS.

Try not to use the spin cycle?

http://taxpolicycenter.org/TaxModel/tmdb/Content/GIF/T03-0193.gif


You can do better Panhandlia?

I was going to say the math didn't look right but you beat me to it. ;)

I was going to say the math didn't look right but you beat me to it. ;)
Well it is pretty difficult to argue with that table? It kinda blows the doors off Mr. Slate's BS column? I guess Mr. Slate has no real journalistic integrity?

I am really getting tired of people complaining about the common-sense notion that the rich should pay a higher percentage in taxes than those with less money.

They may argue the pragmatic point (effect on the economy, and so forth)... but I see no place for an argument from "right." None whatsoever.

Hmm...Well done! I bow to you, for stating your argument far more effectively than I did mine. Kudos.

Pre-Bush, the $1 million a year couple paid 33 times as much as the $60,000 couple; today they pay more than 38 times as much. Here's the big picture:

This is misleading. What percentage of their income do they pay in taxes before Bush and now?

This is misleading. What percentage of their income do they pay in taxes before Bush and now?
The whole article is misleading and is a waste of bandwidth. :eek:

How much? I tend to think almost all of it, and I think it would be hard to support a very conservative estimate. This does not imply, however, that the government MUST tax people for everything they "owe" -- especially since there may be good pragmatic economic reasons for allowing them to keep it. But it does mean, in principle, that no one has the right to complain when their government comes calling at tax time... no matter how high their personal taxes may be.

They may argue the pragmatic point (effect on the economy, and so forth)... but I see no place for an argument from "right." None whatsoever.

one minor point. clearly people cannot claim that they don't owe nobody nothin'. however, the government may not be the proper agent to collect on what is owed to society - especially governments as presently constituted.

one minor point. clearly people cannot claim that they don't owe nobody nothin'. however, the government may not be the proper agent to collect on what is owed to society - especially governments as presently constituted.

Hell, I'll agree with that--see the "anarchy" in my name?
:)


Anarchism, of course, refers both to a philosophy and a conception of an "end result" of political dissent. No self-respecting anarchist should claim that because the present system is unsatisfactory, even inherently unjust, one owes it nothing. When we do this, our "philosophy" becomes merely a justification for selfishness and self-centeredness. Anarchists understand that human beings are constituted by their political and social environment--indeed, this is the basis for much of the anarchist critique of the political and economic status quo. Moreover, given that a part of that critique is that the existing system is less democratic than oligarchic, that the poor are in a number of imporant respects (both economic and political) "ruled" by the wealthy, this perspective reinforces the notion that the wealthy should pay more to government.

There is a dual truth here rooted in the schitzophrenic nature of capitalistic democratic republics. Too many anarchists focus on the first truth, already described, viz. that we really all live under the rule of the rich. But the nature of our society is more complex than that, for one cannot deny outright the possibilities it presents for popular control and the promotion of the general welfare. We are being disingenuous if we deny that the seed of self-rule is present in existing "democracies." Certainly it has to be watered and nurtured, but it is there.

My point is this: One may refuse taxation in political dissent of the ways in which one's money is used but to the extent that one remains a part of this world, one cannot refuse taxation as a matter of "right." Moreover, to the extent that one "buys into" the existing system--to the extent that one supports liberal democracy--one accepts the restriction of primary dissent to explicitly political means: voting, lobbying, etc. One would only rightly resort to a refusal of taxation to the extent that one believes the political system has fundamentally failed, devolved into tyranny, and so forth.

But I have a further point: the fact that some of us believe other systems may be better does not provide us with a moral argument from "right" with which to decry taxation -- and certainly not the taxation of the wealthiest members to benefit the poorest. While it may be true, on the one hand, that the "artificial" alleviation of the suffering of the poorest in society may provide some "safety-valve" for the capitalist state, it remains true that such work toward the public good is perfectly consistent with the values of most of us dissenters. Finally, and perhaps most importantly, to save people from lives of misery, to provide them the resources available to other members of society, is a fundamentally democratic and even anarchist goal... since only once the basic struggle for existence has been pacified are people free to participate meaningfully in politics.

To summarize: I agree that what we have is not best, and not even right. But I deny that this entails a reduction of our obligation to the public for what good we have. Indeed, it demands a greater obligation, in that we are obliged to improve it--we are obliged to revolution. But the values of the revolution cannot be simply summed up as "anti-state" or even "anti-capitalism." Indeed, to have entirely negative values is not revolutionary at all. Thus, true revolutionaries must learn to live with contradiction--an extremely difficult psychological task. They must bear out their positive values in the existing reality, and they must work strategically toward the fulfillment of their ultimate goals. And "stealing from the rich to feed the poor" may just be a strategic step in the right direction. Capitalism, to some extent, has no choice--and we would use that vulnerability against it.