filtherton

I know tax philosophy runs across the spectrum on the tfp. I myself think that taxation is a necessary part of living in a formal, codified group. That at some point resources can and must be pooled to serve the greater good.

I know that some people think that taxation is tantamount to being raped and i'm not really certain why.

I'm just curious as to peoples opinions on taxes and their justification for said opinions. Please keep partisanship and conservative v. liberal out of it.

Ustwo

Some taxation may be needed, I will not argue that, but taxes should not be used to take money from one group of people to give to another, for the sake of buying votes. That is robbery.

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losthellhound

Taxation is neccesary to keep government running, police running, and all the services we have running. I agree though, that taking my taxes and giving them to others is wrong, special interest groups, other countries.. all of it. If I want to donate to charity, I will do it myself

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MSD

Taking money and giving it to others for the sake of votes is wrong.

On the other hand, I think that welfare is sometimes necessary, but should be a crutch to help people until they can walk on their own feet, not a wheelchair with a personal driver who pushes the chair to and from the liquor store.

filtherton

To which others do you speak?

Are you speaking of welfare? Paying soldiers? Subsidizing education? Creating jobs?

I guess i don't see how these are any different. They all provide potential benefits to society.

irseg

A capitalist society functions on the basis that rights will be upheld--that people can leave their house and be reasonably confident that they won't get killed and that their stuff will still be there when they get back. Therefore I believe in taxation for services that provide personal and property protection (police/fire/EMS and military). Public roads are also a necessity as a transportation infrastructure for the military.

And that's where public funding should end as far as I'm concerned. The government does not have the right to play Robin Hood, pay people to drop crucifixes in jars of piss, spend millions to protect frogs and owls, etc.

filtherton

I think it can be argued that protecting the environment and helping people not starve to death or freeze to death can be beneficial to society as a whole.

I guess i'm confused as to how the line is drawn. Let's say we give everybody a free college education(hypothetically it works just fine). How much better of would we be as americans if everybody who wanted to had a college degree? How much better off would the economy be?
The environment is important for obvious reasons. Without it, roads and military seem like moot points.

Obviously people are entitled to their opinions. I just don't understand how some things can be justified based on their obvious benefit to the general populace, while other things aren't justified uses of tax dollars despite the fact that they can have a demonstrable benefit to society. How is the line drawn?

Sparhawk

First off, I'd like to say:

Taxes are the price we pay for a civilized society.
-Oliver Wendell Holmes

This happens ALL the time. Corporate bailouts, Farm subsidies, Nation Building: the list goes ON and ON and ON and ON. Should we have given billions to bail out the airline industry after 9/11? How about the tens of Billions in subsidies for farms, the majority of which doesn't go to small farmers, but rather to the gigantic so-called factory farms. And then there is the tens of billions we are spending rebuilding Iraq and Afghanistan.

Now, some of this spending I agree with, some I don't, but it should be included in the list when we talk "taking money from me and giving it to others," because to say that only unemployed scumbags get the federal dole, and to use that as an excuse to decry the high state of taxes, is asanine.

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santafe5000

Taxes are required to operate the government, but taxes should be applied equally. I am in favor of the flat tax as outlined by f
Forbe's when he ran for Prez.

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FleaCircus

Hallelujah!

Yes, the government needs money to provide these services. No, the government does not need money for handouts, etc. or to pursue an agenga contrary to the goals implicit in "personal and property protection."

Taking money from the citizens to fund such handouts and agendas is, in my view, morally unconscionable.

And there are other ways for a government to make money. Part of property protection is using the courts to enforce contracts; perhaps a "contract registration fee" that must be paid to file a contract with the courts and guarantee its enforceability. Maybe a national lottery, run by the federal government. Maybe taxes, but at a flat proportion across the board, without the loopholes that make current taxation seem that much more unfair.

Either way, if the government limited its spending to the necessities for function and protection, and cut out the rest, they'd need less money to spend.

Hell, I'm just ranting here, but, well, there you go.

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Strange Famous

The main purpose of taxation is redistribution of wealth, to take resources from those who have the most, and give them to those who have the least. I completely support this, and we need to be much better at doing it. When tax is unfair is when it is charged at a flat rate, regardless of ability to pay - taxation should not only be at percentage of income, but those with higher income should pay a higher percentage.

The thing I dislike is flat taxation, and the very wealthy (including corporations) being able to dodge paying tax, these tax criminals need to be persecuted, the loopholes closed, their property confiscated and used to fund the social fund. I would also support cutting military spending to a third or its current rate, and funding a full and complete welfare and national health system, public housing, eliminating homelessness, hunger, and avoidable sickness completely.

As a civilised society, we have a requirement to create a basic standard of living which people are not allowed to fall below. I am interested in the views who say they do not want ANY of their taxation to go to "hand outs" to people who do not have enough.

Should the elderly be left to die when they can no longer work to support themselves?

Do we want to live in a society where the children of those who cannot get work die of starvation or malnutrion? (there are societies in the world where this happens, but do we want America to have the same level of social welfare support as Malawi or Ethiopia?)

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FleaCircus

Why? Is it fair for those who have earned more (through either hard work or good fortune) to have what they've earned taken away forcibly and given to someone who can't--or won't--earn it themselves? Does poverty or inability somehow make you a more deserving person? Does success make you less so?

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We must all have waffles and think, each and every one of us to the very best of his ability."
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Strange Famous

FC,... yes, in my opinion

From each what they can, to each what they need.

This is what I define as a fair means of distribution in a civilised society. We do not live in a meritocracy, we know that wealth is often based on privaledge of birth or social class, but the ideal of a perfect meritocracy is something I reject completely, for resources to be distributed on the basis of the contribution each person makes is completely unfair... in such a system the more capable get more than they need, the less capable less than they need - this is unfair. A fair system is one in which each person works as hard as they can, and is rewarded with the resources they genuinely need to enjoy a good standard of living. The motivation to work hard becomes pride, and decency, and free creative spirit, not naked greed. All people deserve a good standard of life, all people should be required to work.

__________________
"Do not tell lies, and do not do what you hate,
for all things are plain in the sight of Heaven. For nothing
hidden will not become manifest, and nothing covered will remain
without being uncovered."

The Gospel of Thomas

FleaCircus

But if everyone is guaranteed "the resources they genuinely need to enjoy a good standard of living," what compels anyone to work as hard as they can in order to earn it? Why can't I just sit back, sip a margarita, and let others do the work? I'll still get my daily allotment, right?

I think that this is one of the inherent drawbacks of a welfare state. Any maybe I'm a cynic, but the people who would take this approach in a welfare state seem to me to be the ones that wouldn't be motivated by pride, decency and free creative spirit.

Anyway, who says that the people who do enjoy success aren't motivated by these things?

BTW: I've got no problem with people helping out those who they feel are less fortunate, provided it's voluntary. Taxation is compulsory. Charity is not.

__________________
"We must have waffles. We must all have waffles, forthwith. Oh, we must think.
We must all have waffles and think, each and every one of us to the very best of his ability."
-- Professor Goldthwait Higginson Dorr, Ph.D.

Strange Famous

Simply because my view of human nature is that people are basically creatibe and compassionate, and yours is that they are basically self interested? And the way people are now is determined by the capitalist values they live in, and is not the only, or the truest fulfillment of true human nature.

And taxation exists to force those who DONT want to pay to contribute. if I had my choice, I would only contribute to welfare services, and give nothing to the military or the police, I assume you would do the opposite - if as a society we require welfare, defence, and poilice, we must have taxes, so that both of us are forced to contribute to the things we dont believe we should.

__________________
"Do not tell lies, and do not do what you hate,
for all things are plain in the sight of Heaven. For nothing
hidden will not become manifest, and nothing covered will remain
without being uncovered."

The Gospel of Thomas

timalkin

The human species is engineered to get the most benefit while having to exert the least effort. This is not always a bad thing, because we wouldn't be here if our ancestors always did things the hard way.

Communism and socialism will never work as long as human beings are involved. There are just not enough people who will give their best simply because they enjoy the challenge. There is no incentive for an engineer to build a bridge over a huge river if he gets the same benefits as the guy who juggles fruit at the circus.

As for as taxation goes, here is my philosophy:

You spend your own money most carefully on yourself.
You spend your own money carefully on others.
You spend other's money less carefully on yourself.
You spend other's money least carefully on others.

The government spends other people's money on other people. They have no incentive to care if it gets wasted.

brianna

havn’t you folks heard of the working poor? Living at or below the poverty line is not an indication of laziness -- often quite the opposite. in the USA service employees (maids, waitresses, retail workers, meat packers, etc) are paid minimum wage to do exhausting physical labor for often over 40 hours a week (at 40 hours a week on minimum wage an employee will earn $10712 before taxes the poverty line for one person living in the lower 48 states is $8,980 for two people it is $12,120). I don’t think a case can be made that service work is easy and that all people in such jobs choose to be there because they are lazy. You may argue that the working poor deserve their lifestyle because they are stupid but such an attitude, beyond being elitists and selfish, ignores the existence of a caste system in our society. The fact of the matter is that we enjoy cheap goods and corporations enjoy hearty profits all at the expense of the working poor and their families. If companies were farced to pay a living wage we could drastically reduce the cost of social programs -- but until that happens I see no reasonable way to advocate letting poor children go hungry so that you can keep your money.

Lebell

Who is John Galt?

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ARTelevision

I pretty much feel this quote, posted by Sparhawk says it well:

Taxes are the price we pay for a civilized society.
-Oliver Wendell Holmes

Besides that, I accept the will of the people as executed by duly elected officials.

In general, I think capitalism works better than socialism and communism doesn't work at all. So as a general principle, the less that is paid for by taxation, the better. That's my bias.

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onetime2

Taxation is necessary and I have no problem with it to provide security, infrastructure, administration of programs, and even a social safety net of sorts to take care of our aged, infirmed, and young when necessary.

The problem is that the government is nowhere near efficient. There are government organizations that literally lose track of billions of dollars. They can't keep their records straight, fraught with fraud, and there is little reason for them to become efficient since the congress will just raise taxes to cover the inefficiencies.

There are no effective means to limit inefficiency in the government right now. At some point the government will need to be forced into efficiency. Rather than spending the next 50 years dumping countless trillions of dollars into a black hole, I believe we should follow some of Greenspan's suggestions for improving the budget deficits. These steps should include:

Making Bush's tax cuts permanent.

Creating a law that requires increased spending to be offset by cuts in other programs.

And doing something to limit the inevitable failure of Social Security as baby boomers retire.

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filtherton

I guess i see the problem of ineffiency as being seperate from the tax rate. Lack of efficiency, i think, is a reflection of the politicians in charge.

I think if those who attempt to claim the moniker of fiscal conservative spent half the time they spend trying to cut taxes trying to increase efficiency we might be getting somewhere.

That being said, cutting taxes is a very half-assed attempt at increasing efficiency. It seems more like cutting taxes is an under-the-radar attempt to impose ideology.

madsenj37

Is it necessary to keep all government operations running though? I personally think government has gotten too big. Every president has increased the overall size of government and it needs to stop, (I am aware that presidents have axed programs, but as a whole they expand government, at least in spending). Take the FCC for example. I personally think they should make sure no one broadcats on another's waves. Thats it.

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madsenj37

Where to start? First of all, these people are unskilled laborers. I will not argue that most of them work very hard. They have to. Anyone can do their job, they do not have skills that are in such high demand that only certain people can do said jobs.

A living wage is a bad idea. It makes everything more expensive. So these people will be paid more, but they will have to pay more for everything they buy. Their higher wages will drive prices up. And/Or less people will be hired, because companies can only afford to pay so much. More people will be jobless and having to work two jobs whenever possible. More people will be on welfare, since unskilled jobs will be harder to get.

I do agree that many companies could pay their workers better, but which ones? At what times? As for corparations, their profits only make up 9% of the nations income distribution. They use this for later ventures and business expenses. Proprietors make up another 9%. These small business owners make as much as corparations. Are they to blame, too? 18% is not that much considering only 9% is corparations. Rents are 2% and interest is 8%. 72% of income goes to wages and salaries. Out of that 72%, the top 10% pay 64% of the taxes and the top 50% pay 96% of taxes. I do not know where you get your information, but I get mine from my textbook, which uses statistics from 2002.

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madsenj37

1.Do you mean 'From each what one can, to each what one needs?'
2.In a system where people do not have to work hard, they will not. With socialism, I will work harder for not much more, while those who do not work hard, still get something. Capitalism may be greedy, but it motivates people to work hard and gives them the desire to move up the ladder by working hard. In socialism, if I do not do it, someone will do it for me.

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Manx

You missed the rest of the sentence you are responding to:

If companies were farced to pay a living wage we could drastically reduce the cost of social programs

In other words, if companies were forced to pay a living wage, we could cut some of the taxes that pay for social programs. Taxes go down equivalent to the pay increase, prices are not driven up, and/or no less people are hired, because companies will be able to afford what they can afford today. Less people will be jobless because less people will have to work two jobs, opening up positions for others. Less people will be on welfare (which is good, because there would be less of it due to the tax cuts). Unskilled jobs will be easier to get because many of the people working two or more will now only need to work one.

The main issue is not how much money corporations make in comparison to the other areas that money goes - the issue is that corporations have been significantly increasing profits for 3+ years now, but there has been NO equivalent increase in payroll. It is the inevitable increase in wealth disparity due to deregulating business.

KMA-628

uh, what??????

Where did this little pearl of wisdom come from?

You might not want to state your opinion as if it is fact.

Edit: I just saw your next post.

KMA-628

Um, no.

Fact: a side-effect of raising the minimum wage is a decrease in the demand for labor. i.e. an increase in unemployment. That means less taxes going to the "social programs".

Forcing a system out of equilibrium will most always have negative side effects.

The other problem is that no one will ever agree on exactly what a "living wage" is. $6.50? $7.00? $8.00? $10.00? or even higher.

Tarl Cabot

Who are you arguing with? I haven't seen anyone in this thread bring up the above.

KMA-628

O.K., I have spent about 30 minutes on this statement and can't find anything to back it up (or disprove it).

I think the statement itself is a little too braod for the argument. Which corporations? All of them? Foreign or domestic? Which industries?

I do know that companies spend more on payroll than they receive via profit, but I am not sure that has anything to do with your argument.

With all of the post-recession and post-9/11 economic problems we have had, I don't think this argument can be made. Especially when one factors in all of the variables.

Manx

When do workers get their share?
http://www.epinet.org/content.cfm/we...shots_05272004

Lopsided trends in profits and wages
http://www.epinet.org/content.cfm/we...shots_04122004

Manx

I addressed this in post #25. There would be many side-effects of raising the minimum wage. One of those side-effects would be more jobs as the people that are presently working more than 1 will no longer need to do so. Ergo, less unemployment, less taxes going to "social programs".

If you shift money to one location, it will come from somewhere else. You imply it will come in the form of more taxes, but that is to ignore the reality of more available jobs. Taxes will go down, prices do not shift much if at all.

A living wage does nothing but shift the burden of financing work from me and you to the corporations that reap the profits from the work.

KMA-628

Manx -

Every economic model that I have ever seen (that includes hypothetical and real world data) shows the exact opposite of your claim.

Maybe this analogy will clarify my point.

The current price of a can of pop is $0.50.
The current demand for pop is 10 million cans (out of my ass).

Every increase (no matter how small) in price for that one can of pop will cause a decrease in demand (an even greater decrease if there is a substitute).

Now, on the reverse, what happens when the price for the can of pop decreases? Yup, the demand increases. That is why the demand curve slopes down and the supply curve slopes up. At higher prices, the suppliers want to produce more. At lower prices, the suppliers want to produce less and the buyers want to buy more (i.e. scarcity).

Substitue labor for the can of pop because they are the same thing. We are the suppliers and the companies are the buyers.

Now, in the case of labor, do the buyers want to buy more when the price is going up? Nope. They buy less. So, what does that mean that buyers (i.e. companies doing the hiring) do when the price of the product they want (i.e. labor) goes up?

Everything follows this rule. Be it cars, labor, food, etc. (baring substitution)


As much as everyone wants to throw niceties and emotions into an argument like this, it cannot be done.

Wouldn't it be nice if everybody made a lot of money? Of course it would. Is it feasible? Nope.

Labor, as a product of the marketplace, is bound by the rules of the marketplace. You cannot debate using emotions against fact.


If you would like, I can go back and find the models I am referring to. Anybody with even a cursery knowledge of economics should be able to grasp these concepts without the data, but if the data is requested, I will get it and post it (which, would continue this threadjack even more).

I have never, ever, ever, ever, ever, seen any model (or hint of a proposed model) that shows that tax revenue will increase with an increase in the minimum wage or that more jobs will be created because of an increase in the minimum wage.

The supply will increase, but the demand won't.

KMA-628

I am having a hard time with your source. Several of the statements made there are highly questionable, but hard to truly dispute as the facts aren't clearly given. Here is an example:

This claim is made by EPI:

First, it is a no-brainer that the majority of people that earn minimum wage will be adult, especially since "adulthood" starts at 18.

However, almost half of the workers making minimum wage or less are under the age of 25. A little more than 25% of minimum wage earners are 18 or under. That shows that, proportionately, there are considerably more people not yet to adulthood, that earn the minimum wage or less.

And more:
Food service = usually makes even more money once tips are included, if they are reported.

From your source, the Economic Policy Institute:
From the Bureau of Labor Statistics:
Not necessarily an exact match, as one references "poverty level" wages and the other references "minimum wages". However, I find it odd that one shows a decrease and one shows an increase for a very similar labor pool.

As with statistics, if you want a desired result, it is relatively easy to get there if you are in control of what facts are included and which facts aren't.



In my opinion, wage growth cannot be forced, it is a product of the particular market. Why did the earnings in the IT category explode during the 90's? Easy, the demand increased without a corresponding increase in the supply, which causes labor prices to increase. Why are they decreasing now? The supply went beyond the demand.

For the most part, you have to let the marketplace set the labor price, it will be much more efficient that
way.

SOURCE

KMA-628

Actually, I am the same as the corporations you so detest.

My partner and I are in the middle of a start-up company. Our workload is increasing fairly heavily and we will probably need to higher lower-paid workers to cover the brainless part of our jobs that take our time away from the more profitable parts. Then, as the workload increases even more, we will probably have to higher more skilled workers.

In other words, I can only afford to pay so much per hour. I justify bringing in a new worker by comparing the work that they will do with the value that work has. If I have to pay the person more than the value of the job, what do you think I will do? Answer, not hire. It would be more profitable for me to continue to increase the hours I am working than to pay a new hire more than the position is worth.

The rule of thumb is that I will continue hiring until the additional cost associated with hiring the last worker is equal to the revenue generated by that worker. Now, if the "cost per worker" is higher, do I buy more labor or less? Answer: Less. If the "cost per worker is higher" do I buy more or less labor? Answer: More.

smooth

KMA,

I would like you to address the following:

In the European countries, productivity has increased as wages have increased for the past 50 years, according to Jeremy Rifkin (The European Dream), even surpasing the productivity of the US.

Has this created more jobs? Not necessarily. But what has happened is that people work less. They get to spend the money they make on things they feel make their lives better, such as, vacations and family time. They don't ultimately make more money, but they work less by receiving higher wages.
Currently they need immigration and higher reproduction to meet the growing demand of a tax base.
I want to repeat: both he and I recognize the model has problems and is not yet fully realized.

So we have the option of having unemployed people, as you suggest by the business model you are using in the portion I quoted, or hiring more people at higher wages, but not working them for very long.

So a very simple example: you have $100 dollars to spend on labor.

You can follow the American model: hire one worker @ $10/hr and work him 10 hours.

Or the European model: hire two workers @ $15/hr and work each of them for 3 hours.

Then it becomes an empirical question as to whether or not productivity would increase 3 fold. If I understand him correctly, Rifkin's argument is that it does.

But don't get hung up on that very glib example, please. Refuting those specific figures isn't the point, but to use it heuristically. For example, to further flesh this out. We might wonder about the plight of each worker who now only earns half as much ($45 income rather than a single worker making $100). But two responses to this: a) higher productivity would increase profits. It might be that you would actually have $200 to spend on labor, so you could have the workers produce for 6 hours. b) two workers in a family could conceivably work for 3 hours each (6 total is still less than 10) and be able to reap the same total financial reward, while allowing each member to be productive work force (satisfying and healthful for economy) and family time (satisfying and healthful for society).

You might be in the perfect position to try an experiment. You could, for example, strike a deal with one of your laborers that essentially states: I increase pay, reduce your hours, but your productivity needs to increase X amount (to be determined so the overall equation remains basically static). Try that for a month or two with your employee. If the productivity doesn't increase, back to the American model of driving wages down and increasing hours. I personally think that model produces downward pressure on producivity.

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Manx

It would be nice if you didn't approach this debate with such obviously ridiculous statements as those two. The "facts" you have presented are not being disputed. But what you fail to consider is pretty much everything I have already said:

Follow along now -

Increasing pay to workers will result in less workers requiring more than 1 job which will result in more people working which will result in lower taxes which will result in a one-for-one balance in trade for companies who increase the pay they give to workers.

Cherry picking a few sentences that you do not actually refute does not weaken the overall information that was presented: corporate profits have increased while wages have not, in comparison to previous recovery periods.

That sounds an awful lot like "emotion" attempting to argue against "facts". I own a company and I hardly despise myself or my company or the concept of a company. As I have mentioned a number of times now, increasing the pay to employees, as a government policy, will result in lower taxes. You and your partners' tax liabilities will drop allowing you to afford paying your workers.

alansmithee

They tried that. It was called communism. If I recall, it didn't turn out so well.

That being said, I actually do agree with some redistribution. Simply because the higher income groups often get there by taking advantage of the lower income groups. What I don't believe in is flat-out welfare. Assisting people who are actually trying and have something to contribute is one thing, but if someone's just lazy they should be left to fend for their own.

KMA-628

How would this model be better for the worker?

The American goes home with $100.00 gross.

The European goes home with $45.00 gross.

That American will make over twice what the European will. Factor in tax rates and the difference is even higher.

I may be reading your post wrong, but that just doesn't make sense to me.



Manx -

When it comes to menial labor, productivity isn't always an issue. Only so much can be done in a certain time. What matters to me is what the value of that job is.

For the example, I will be specific. Our firm provides a unique engineering service to our client. Currently, we are the only company in a multi-state region capable of handling the type of work we do. Right now our competition is our customers themselves. What I mean there is that most of our clients have the ability to do what we do in-house. We do it better/cheaper/etc. and people choose to use us instead of their own in-house engineers.

Right now, we spend a lot of time doing things that hold very little value to the finished product. i.e. driving, picking stuff up, dropping stuff at customer's, etc.

Now, add the fun part: there really is no way of learning what we do unless you learned the skills while working for a different company (i.e. you can't go to any school to train on our industry). By that fact, getting a skilled worker is rare and very valuable. An unsklled worker holds very little value to us other than by taking care of the menial work.

For a skilled worker, I would pay around $30.00/hr.

For an unskilled worker, who would just be helping out, I would pay no more than $8.00

Anything above the $30.00/hr, at first, is not worth it to me (I can only charge my customers so much before they look elsewhere/or go back to their in-house options).

For the unskilled worker, $8.00 would be pushing it. For the tasks this person would be done, productivity would not be the issue (i.e. I expect a certain level to begin with and don't have high aspirations for considerably more productivity). For example: I need someone to pick up/drop off packages at our customer's locations. There is a definite limit as to how much can be done in one day (i.e. driving speed, traffic, distance, etc.). Even if I pick up some kid who wants to work his ass off, he will only be able to get XX done each day. Paying him more, whether by force or voluntarily, makes the kid too expensive to keep/hire.

Then, add the work ethic of the average American worker who gets around $8.00/hr and you will see what I mean. How many people will I have to replace at the $8.00/hr level? Probably quite a few. That makes an additional cost and an additional burden to me.

The hope is that I find somebody who understands the concept of entry-level, starts low, learns the business and then becomes worth more money to me. Once that happens, I would happily pay that person more money.

KMA-628

How will increasing pay lead to less workers?

If I put an ad in the paper offering a janitorial position for $5.15/hr, how many responses will I get?

If I put an ad in the paper offering a janitorial position for $30.00/hr, how many more responses will I get?

Forcing a company to pay its lower workers more, will not, in any way, create a greater demand for more workers. It will create a greater supply, but less buyers of the product.

I am having problems just getting past your first premise of this statement.

No kidding, please explain to me how raising the minimum wage will create a greater demand.

And, unless I am doing something wrong, I don't get any tax breaks or more tax deductions based on my workers. I get my deductions elsewhere, not from the labor I use.

Manx

People work more than one job because they do not earn enough money at one job to live.

Pay them more in one job and they will not work the second, opening it up for someone else to work.

The demand already exists but it is filled.

You get tax breaks because money needed for social services goes down as unemployment goes down.

edit: Also note Smooth's description of the gains in productivity due to happier/more fulfilled workers.