The random political thoughts thread (Part Deux)

[Morrigoon]

Originally Posted by scaeagles

Are we talking who pays what in terms of federal taxes or wealth distribution?

I just think that when a man with 50x more income than someone with 20k pays 255x more federal taxes it is reasonable to say that the person pays their fair share. No debunking (the numbers come from IRS data).

If you don't like the distribution of wealth in the country that's a different matter.

Yeah, the problem here is focusing on 'income' because of what a loose definition that has in terms of taxation. Usually when people talk about taxing the rich more, they discuss it in terms of income tax, which puts the heaviest burden on high wage earners, not the truly wealthy.

The problem you have is with incentives and reinvestment. You can't tax investment so heavy that there is no benefit to putting your money into anything (vs. the risk) And then you have the added difficulty of how to tax investment in a world where everyone has 401K's instead of actual retirement plans. And how to make it so it doesn't unfairly burden the small-time investor, who already has the highest cost of entry, when you consider the fee structures of investment companies.

I'm not saying Buffett isn't right (he usually is), but it's VERY difficult for people who don't really understand business (aka politicians) to come up with a safe structure for accomplishing this goal.

[Ghoulish Delight]

Originally Posted by Morrigoon

The problem you have is with incentives and reinvestment. You can't tax investment so heavy that there is no benefit to putting your money into anything (vs. the risk)

You're right, which is probably why capital gains taxes are at their lowest level in ~80 years.

It is complete fiction that the highest earners/wealth holders in this country are being over-burdened by taxes. They can point to individual pockets of taxation that make it look that way, but that's only because they have been increased in an attempt to balance out the fact that the rest of their money is completely sheltered from taxation and that, overall, by any practical definition, they pay far smaller percentage of what they actually earn in taxes than the majority of this country.