"Capitalists = Job Creators" is Completely Wrong

[Ideologue]

My belief is that they have benefited inequitably from the stability and services provided by the state (and ultimately by the people), so it is fair that they split some of that difference with the state (and ultimately the people) which made their success possible.  The state and people invested in them, in uncountably many and different ways.  The state and people deserve their return, as well as the individual, whose (undisputed) economic success is factually not due to their own merits alone.

Thanks for taking the time for actually explaining why you think it is fair. I disagree, but at least you took the effort.

Well, you're a good guy, Tam.  If you hold (no offense) ideas I find rather suspect, it's not that you don't hold them honestly or through malice.  Also, you're European, and I reserve serious vitriol for people whose votes can affect me.

I disagree because even if I accept your stance, namely that no individual can benefit from his talent without the mighty state guiding him along the way, the people who achieve higher than average income, enjoy the exact same perks as the ones who don't. And, even with a flat tax, they pay in considerably more than those who failed to take advantage.

My biggest theoretical problem with a progressive tax is that it projects the idea that society's desired place for the individual is somewhat below middle class. Or lower middle class, depending on where your lowest bracket ends. Anything above that is not really necessary or desired, and therefore can be robbed more of it's gains.

I think that's the communication breakdown, here.  Under your paradigm, taxation as theft; under mine, taxation is payment for services rendered.  Services that benefit the rich out of proportion to their income.  The example I used once before when explaining this position is roads.  The poor use roads--at best--as a mean of transportation, to get themselves to and from their shitty jobs, to buy necessities and amenities.  The rich, by contrast, use roads as a means of profit, delivering the goods the capital they own and the labor they hire produces to market.  The man who owns a good deal of Wal-Mart stock is employing the transportation network, paid for by tax dollars, as another form of capital.  (That it benefits the poor who shop at Wal-Mart as well is beside the point.)  Likewise, I can cite education, the military, and the Internet (maybe) as examples of government-funded objects which benefit wealth more than the poor, at a greater than linear (i.e., flat) relationship.  Even regulatory processes benefit the rich, although they rarely see it: the FDA's process for approving drugs, for example, creates a more trustworthy, stable market, and thus greater profits in the long run.

I mean, I'd prefer Wal-Mart just be owned by the government, but baby steps.

[CountDeMoney]

Demand will create supply.  Supply does not necessarily create demand.

My infinite demand for a time-machine has yet to furnish the product.

Oh, so you've read "The Secret" too, huh?

[Iormlund]

But nobody has been able to explain the moral angle. The morally right thing is to tax everyone the same percentage. Why is it immoral that some people earn more than others? Why should these people be punished by a higher income tax?

Richer people derive more benefit from state intervention. They are prime targets of crime, for example. You only need to look at the amount of money affluent classes need to spend in protection in less developed regions of the world or during past history.

A stable society with suitable infrastructure and access to affordable education acts as a multiplier for those who have capital and provides superior security.

[Tamas]

That is a fair point, just like Ide's.

But it is also covered fully by a flat percentage tax, so I don't see how it justifies progressive ones.

[Neil]

Redistribution is the only thing holding our tenuous social order together.

No wonder, after this many decades of relying on it.

No, even when it started.  Why do you think that the civilized world never had a successful totalitarian movement?

[Iormlund]

But it is also covered fully by a flat percentage tax ...

That's an arbitrary opinion, as good as any other.

[Neil]

But nobody has been able to explain the moral angle. The morally right thing is to tax everyone the same percentage. Why is it immoral that some people earn more than others? Why should these people be punished by a higher income tax?

That's not morally better than taxing progressively.  From each according to his means.  The state is a community, and a community shares.

[Tamas]

But nobody has been able to explain the moral angle. The morally right thing is to tax everyone the same percentage. Why is it immoral that some people earn more than others? Why should these people be punished by a higher income tax?

That's not morally better than taxing progressively.  From each according to his means.  The state is a community, and a community shares.

for each according to his means. Yes. X% of their income. Nobody is allowed to keep more of their income proportionally than the other. If they benefit more, they pay more.

[Valmy]

Then you get a public with lots of debt, like we have now.

Well if you market financial products...which we do...heavily.  But that is not really related because there is always a demand for money.  Countries with low amounts of debt do not have less advertising.

[Neil]

But nobody has been able to explain the moral angle. The morally right thing is to tax everyone the same percentage. Why is it immoral that some people earn more than others? Why should these people be punished by a higher income tax?

That's not morally better than taxing progressively.  From each according to his means.  The state is a community, and a community shares.

for each according to his means. Yes. X% of their income. Nobody is allowed to keep more of their income proportionally than the other. If they benefit more, they pay more.

The problem with your idea is it won't leave the state with enough money to operate.  Therefore, the more successful members of society have to make up the difference.

[Tamas]

But nobody has been able to explain the moral angle. The morally right thing is to tax everyone the same percentage. Why is it immoral that some people earn more than others? Why should these people be punished by a higher income tax?

That's not morally better than taxing progressively.  From each according to his means.  The state is a community, and a community shares.

for each according to his means. Yes. X% of their income. Nobody is allowed to keep more of their income proportionally than the other. If they benefit more, they pay more.

The problem with your idea is it won't leave the state with enough money to operate.  Therefore, the more successful members of society have to make up the difference.

How about making a state that can operate within the means of a just taxing system?

[Neil]

But nobody has been able to explain the moral angle. The morally right thing is to tax everyone the same percentage. Why is it immoral that some people earn more than others? Why should these people be punished by a higher income tax?

That's not morally better than taxing progressively.  From each according to his means.  The state is a community, and a community shares.

for each according to his means. Yes. X% of their income. Nobody is allowed to keep more of their income proportionally than the other. If they benefit more, they pay more.

The problem with your idea is it won't leave the state with enough money to operate.  Therefore, the more successful members of society have to make up the difference.

How about making a state that can operate within the means of a just taxing system?

I don't accept that your system is just.

At any rate, the state can't cut back anymore.  When the sense of community and human relationships were destroyed by the post-war and post Cold War eras, the state had to rush in to meet the fallout for all those people whose support networks had vanished.  The selfishness of your ideology is what makes the state necessary.

[Tamas]

It is not selfish. Quite the contrary. It seeks fair and proportionally same contribution from each citizen, with no qualitive distinction between them based on income (one way or the other, I understand the US gives tax breaks to the rich, which is even more retarded than overtaxing them), and doing that by ensuring that as much income (PRODUCTS OF THEIR WORK, let's not forget) remains with them as possible.

[Razgovory]

Countries with low amounts of debt do not have less advertising.

I'd be surprised if that is true.

[Berkut]

Tamas, I understand your point, but think you are looking at the "fairness" angle incorrectly, IMO.

You are looking at it from the individuals perspective.

I look at it more from a systemic perspective.

The state requires funds to operate. Quite a lot of funds in fact. Where should it get those funds?

The simple reality is that a flat tax system cannot generate the funds necessary without taxing the poor and lower middle class at crippling rates. It simply does not work. This is just math.

So therefore we need some other system. What is fair? Hell, I don't see the state using its monopoly on violence to force it's citizens to give it money as a partifularly "fair" endeavor anyway you slice it - so I care a lot more about making the system work and cause the least amount of harm while it goes about collecting the revenue society has decided it needs to operate.

And that means a moderately progressive tax system. The simple reality is that the wealthy can give up a larger portion of their income while

A) Not causing them great harm, and
B) Not screwing up the economic system (ie dis-incenting them from working/creating GDP)

I have a household income somewhere around the 100k/year mark. Taxing me another 1% harms me very little compared to taxing someone making 30k/year. It also has very little impact on my desire to work more compared to someone making far less than I do. Is it "fair" to tax me at 28% and someone making a little less at 27%? Absolutely - depending on how you look at it. Is it unfair to tax me more than someone else? Absolutely - depending on how you look at it.

Arguments of "fair" can be validly made in either direction - therefore they don't really have any place in the debate, IMO. I think what is more relevant is what works and does not work, and how the tax system does what it is supposed to do (generate revenue) while minimizing the harm that it does in the process through creating perverse incentives.

I do NOT think that the purpose of the tax system ought to be moving wealth from the wealthy to the not wealthy as a primary objective - I am ok that this will happen as a secondary effect of deciding to implement social programs that society deems desirable. A subtle difference, to be sure, but an important one, IMO.