Current Events > OMB: Top 20% pay 95% of all income taxes

(+) Yeah! (+)

Balrog0 posted...

Questionmarktarius posted...

If you tax someone an increasing percentage of increasing wealth, eventually you'll reach a point where additional income just isn't worth earning.

almost everyone who is actually working for their money would almost certainly not be making enough for that to be true of them, though, if we were to apportion people based on wealth rather than based on earned income receipts

even the people who work for living at the very top do not make their wealth from working

I would say that earning money from capital gains / investments is still working for your money. You aren't just randomly putting money into whatever index funds you can find, or buying any random ass investment property or something. There's work to be done there, and management, and time. And opportunity cost.

No income is truly passive.

Is there any data on how much in entitlements the top 20% use? IE how much they consume.

I'd be curious in seeing if they produce much more than they consume.

Balrog0 posted...

Questionmarktarius posted...

FLUFFYGERM posted...

We need more granularity than measuring by net worth imo. Someone can have $500,000 in equity in a home worth $3,000,000 and they're arguably not wealthy, since all that gets you in some cities is a cardboard box.

A "wealth" tax would be disastrous. It would essentially be property tax multiplied by several orders of magnitude.

I don't get the line of argument at all. I don't know anyone who is seriously pushing for a 'wealth tax' but I don't see how you can simultaneously like a literal flat tax but then say the way we measure wealth is flawed because cost of living varies in different areas.

Isn't it incredibly obvious how hypocritical that is? Adjusting for COL and adjusting based on ability to pay are like literally two sides of the same coin.

A wealth tax is based on the stuff you have already. Not the stuff you got this year.

Here's an absurd and fantastical hyperbole:
Let's say I become ludicrously rich somehow by being tougher than the toughies and smarter than the smarties, and somehow stockpile a hundred trillion dollars in a money bin, paying income and various other taxes the entire time. Then, I retire and have an income of essentially zero, or maybe enough interest generation (which is also being taxed) somewhere to cover daily expenses, and occasional travels with some family.
A wealth tax would ignore my actual income and look directly at my moneybin instead.

Taxing nonwage income at higher rates would just make it less attractive for me to put money into the market. At least in America.

If the long term capital gains rate went from 20% to 40%, are you suddenly not going to invest?
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Musourenka posted...

Taxing nonwage income at higher rates would just make it less attractive for me to put money into the market. At least in America.

If the long term capital gains rate went from 20% to 40%, are you suddenly not going to invest?

If the rate doubled, I would no longer invest in the market. At least not through the conventional means in the USA. Fuck that.

Musourenka posted...

If the long term capital gains rate went from 20% to 40%, are you suddenly not going to invest?

Capital gains rate is nothing more than social engineering. Income is income.

FLUFFYGERM posted...

They're taxed less than wages if you leave the money in the market for a minimum of two years, IIRC. At which point they're taxed at a rate that is lower than income tax but still high enough to feel the burn.

Taxing nonwage income at higher rates would just make it less attractive for me to put money into the market. At least in America.

one year

and i mean, ask yourself honestly if you'd really stop investing if your net profits were taxed more, when the alternative is losing a percentage of that money to inflation

the whole double taxing argument isn't applied to small business income, or sales tax, or anything else that hits people outside the investor class so i'm not eager to wring my hands over capital gains taxes either

FLUFFYGERM posted...

Is there any data on how much in entitlements the top 20% use? IE how much they consume.

that's super hard to measure since they use roads a lot more for things like transporting goods
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Why should pushing a broom be taxed more than pushing a pile of cash, anyway?

Questionmarktarius posted...

Why should pushing a broom be taxed more than pushing a pile of cash, anyway?

on this we agree. while i dislike the idea of a flat tax we have common ground in opposition to favorable treatment of investment over labor
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Darkman124 posted...

FLUFFYGERM posted...

They're taxed less than wages if you leave the money in the market for a minimum of two years, IIRC. At which point they're taxed at a rate that is lower than income tax but still high enough to feel the burn.

Taxing nonwage income at higher rates would just make it less attractive for me to put money into the market. At least in America.

one year

and i mean, ask yourself honestly if you'd really stop investing if your net profits were taxed more, when the alternative is losing a percentage of that money to inflation

I didn't say I'd stop investing. Just that I'd stop investing in the market through the usual channels. Less profit means less reason to part with my money in the risky market. And if everyone thought that way we'd be in trouble. (And I can guarantee it'd be trouble if we doubled the capital gains tax rate)

FLUFFYGERM posted...

I didn't say I'd stop investing. Just that I'd stop investing in the market through the usual channels. Less profit means less reason to part with my money in the risky market. And if everyone thought that way we'd be in trouble. (And I can guarantee it'd be trouble if we doubled the capital gains tax rate)

so you'd take channels that were much higher risk? not sure what channels you're referring to
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Darkman124 posted...

that's super hard to measure since they use roads a lot more for things like transporting goods

idk i have a feeling that the top 20% which pays 95% of all taxes is definitely producing much more than they consume

we should get some data going

The Trump administration says lots of things.

Forgive me for not giving two shits what they say about the superwealthy while trying to give them a massive tax handjob.
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Questionmarktarius posted...

Why should pushing a broom be taxed more than pushing a pile of cash, anyway?

it shouldn't. lower the taxes people pay. simple.

Darkman124 posted...

FLUFFYGERM posted...

I didn't say I'd stop investing. Just that I'd stop investing in the market through the usual channels. Less profit means less reason to part with my money in the risky market. And if everyone thought that way we'd be in trouble. (And I can guarantee it'd be trouble if we doubled the capital gains tax rate)

so you'd take channels that were much higher risk? not sure what channels you're referring to

I'd buy more real estate and I'd look into going offshore for tax avoidance.

Questionmarktarius posted...

Musourenka posted...

If the long term capital gains rate went from 20% to 40%, are you suddenly not going to invest?

Capital gains rate is nothing more than social engineering. Income is income.

I think there's more to it than simply saying "income is income", but to answer your other post, there is no reason that labor should be taxed higher than unearned income.
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FLUFFYGERM posted...

95% of all taxes

they do not do that
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Balrog0 posted...

FLUFFYGERM posted...

95% of all taxes

they do not do that

oh so was the topic title wrong? i didn't read the topic

_Near_ posted...

the top 1% pays for almost 50% of that 95% tc was talking about

so when you say the top 20%, you definitely include millionaires

Yes but you also "include millionaires" in the top 40% and top 70% and such.

I mean, if the top 20% pay 95% of taxes, changing the discussion about the top 30% won't adjust the 95% taxes by a significant margin.

Talking about the top 20% is essentially a dishonest tactic that obscures exactly how much wealth is possessed by the a really small amount of people, much much smaller than the top 20%. Most people in the top 20% aren't doing things like flying around in private jets because they actually can't afford things like that. 20% is an rich and comfortable life, but the bottom end of that 20% doesn't own anything compared to top 1 or 0.1% ers.

They aren't the problem. It's the 1% / 0.1%ers that need to be taxed more.
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FaytlessHearts posted...

The rich pay almost no taxes, most use loopholes. Can not wait for our country to grow a pair, and overthrow the rich. Gonna be a while, but when it happens, boy its gonna be so bloody.

i mean it says a lot about your mental health to wish for things like this

It's not a wish, it's going to happen. Do you really think that this can continue to go on for another 200 years? With no consequences?

Human beings are savage. It is unfortunate, but when it happens, its gonna be bad.
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FLUFFYGERM posted...

oh so was the topic title wrong? i didn't read the topic

no your interpretation of 'all income taxes' (federal income taxes) as 'all taxes' was wrong

i think at the core of it you have to carefully define what you mean by 'producing' because our federal government places value on things like having children, which is the big reason that people below the top 20% pay so little in federal income tax
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FaytlessHearts posted...

The rich pay almost no taxes, most use loopholes. Can not wait for our country to grow a pair, and overthrow the rich. Gonna be a while, but when it happens, boy its gonna be so bloody.

Meanwhile, in Venezuela...

Your best case France, which did so four or five times before figuring out that it's a bad idea (and even that's debatable).
The worst case is Haiti, which is still a craphole 200 years later.

FaytlessHearts posted...

It's not a wish, it's going to happen. Do you really think that this can continue to go on for another 200 years? With no consequences?

You've bought into a delusion, propagated by idiot politicians who stand to benefit from riling people up.

Darkman124 posted...

FLUFFYGERM posted...

oh so was the topic title wrong? i didn't read the topic

no your interpretation of 'all income taxes' (federal income taxes) as 'all taxes' was wrong

oh my b

still doesn't change my point though. the people who contribute the most - are they consuming more or producing more?

FLUFFYGERM posted...

FaytlessHearts posted...

It's not a wish, it's going to happen. Do you really think that this can continue to go on for another 200 years? With no consequences?

You've bought into a delusion, propagated by idiot politicians who stand to benefit from riling people up.

Ok. I wish I'd be around to tell you I told you so, but you and I will be long gone by the time people start waking up.
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FLUFFYGERM posted...

still doesn't change my point though. the people who contribute the most - are they consuming more or producing more?

that's not a point

that's a question
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ChromaticAngel posted...

It's the 1% / 0.1%ers that need to be taxed more

I agree, that's why I said millionaires.

I didn't make any reference to TC's 20% thing, but I think you're underestimating the amount of millionaires that there are.

https://www.cnbc.com/2017/03/24/a-record-number-of-americans-are-now-millionaires-new-study-shows.html

10.8 millionaires. That's roughly about 3% of the U.S. population. Millionaires don't need to make $1 million every year. The more wealth you have, the easier it is to make more.

It's not just the .01 percent that needs a tax raise.
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FLUFFYGERM posted...

still doesn't change my point though. the people who contribute the most - are they consuming more or producing more?

Were this an actual market economy, both would be functionally identical.

Maybe if the top 20% didn't f***ing horde the wealth like Scrooge McDuck we wouldn't be in this situation to begin with

Anyone who tells you rich people have their money in a cookie jar is lying to you. They have it invested, and as such, it's helping the economy just like you think it should.
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DevsBro posted...

Anyone who tells you rich people have their money in a cookie jar is lying to you. They have it invested, and as such, it's helping the economy just like you think it should.

equity investments arguably are not directly beneficial to the economy, except during an IPO or corporate asset dilution. when you buy a share of a stock you don't buy it from the company, you buy it from another person selling their shares.

people bidding up shares of apple are not allowing apple to invest in new products, for example. they do that out of their hoard of profits, which are presently sitting in liquid investments themselves.

what is unquestionably beneficial to the economy is increasing the ability of people in the US to buy products made by companies that employ workers in the US.
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Darkman124 posted...

equity investments arguably are not directly beneficial to the economy, except during an IPO or corporate asset dilution

citation?
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FLUFFYGERM posted...

You've bought into a delusion, propagated by idiot politicians who stand to benefit from riling people up.

Wages have been stagnant for 40+ years despite productivity and GDP per capita exploding. Life expectancy in the US has actually decreased in the last year or two. People are eventually going to get fed up with only a few people hoarding wealth.
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Darkman124 posted...

FLUFFYGERM posted...

still doesn't change my point though. the people who contribute the most - are they consuming more or producing more?

that's not a point

that's a question

oh my b

so are they consuming more than they produce?

lderivedx posted...

FLUFFYGERM posted...

You've bought into a delusion, propagated by idiot politicians who stand to benefit from riling people up.

Wages have been stagnant for 40+ years despite productivity and GDP per capita exploding. Life expectancy in the US has actually decreased in the last year or two. People are eventually going to get fed up with only a few people hoarding wealth.

Yup. Exactly. It's coming.
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_Near_ posted...

10.8 millionaires. That's roughly about 3% of the U.S. population. Millionaires don't need to make $1 million every year. The more wealth you have, the easier it is to make more.

So how much should someone be allowed to make each year?

And no shit it's easier to make more money if you have more money. That's just asserting a mathematical truth as if it's a bad thing. More money = more opportunities for leverage and investment. No duh.

lderivedx posted...

FLUFFYGERM posted...

You've bought into a delusion, propagated by idiot politicians who stand to benefit from riling people up.

Wages have been stagnant for 40+ years despite productivity and GDP per capita exploding. Life expectancy in the US has actually decreased in the last year or two. People are eventually going to get fed up with only a few people hoarding wealth.

you're buying into a delusion spouted by idiot politicians who stand to benefit from riling people up

https://www.brookings.edu/blog/ben-bernanke/2016/10/19/are-americans-better-off-than-they-were-a-decade-or-two-ago/

https://www.forbes.com/sites/timworstall/2013/06/01/astonishing-numbers-americas-poor-still-live-better-than-most-of-the-rest-of-humanity

Questionmarktarius posted...

A fair system would be something along the lines of "15%, no deductions. Period."

That wouldn't be fair at all. To a person who makes 10,000 dollars a year paying 1,500 dollars in tax matters way more to them than a person who makes 1,000,000 dollars a year having to pay 150,000 dollars in taxes. The person making 1,000,000 a year can still very easily live with 850,000 dollars whereas the guy who makes 10,000 a year is going to really struggle even harder without that extra 125 dollars a month.
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Drpooplol posted...

citation?

not really sure what would properly study this, aside from the idea that equity prices are driven by corporate earnings, not the other way around, or that established companies don't frequently dilute board holdings to raise capital

unless you're just fucking with me, i can never tell
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If you took all the wealth that was being "hoarded" by the wealthy and redistributed it, it wouldn't actually go very far. They don't have that much. Consider taking everything the Walton family homes. How much would each citizen get if we were all given an equal share?

And what is "hoarding wealth" supposed to mean? Are people who earn $1 million per year and saving $500,000 per year in their bank account and investments "hoarding" it? Is that a bad thing? Stop using charged rhetoric as if everyone agrees with you.

FaytlessHearts posted...

lderivedx posted...

FLUFFYGERM posted...

You've bought into a delusion, propagated by idiot politicians who stand to benefit from riling people up.

Wages have been stagnant for 40+ years despite productivity and GDP per capita exploding. Life expectancy in the US has actually decreased in the last year or two. People are eventually going to get fed up with only a few people hoarding wealth.

Yup. Exactly. It's coming.

If we somehow magically confiscated all the wealth in the world, and redistributed the resulting $50000-ish per person to everyone, we'd be right back to radical wealth inequality within a decade.

FLUFFYGERM posted...

If you took all the wealth that was being "hoarded" by the wealthy and redistributed it, it wouldn't actually go very far. They don't have that much.

http://time.com/money/3919690/americans-total-net-worth-record/

for ref total networth (incl real estate) was 85T in 2015

it'd go farther than you might think

top 20% had 600k in 2011 from balrog's link, or 120k/household if distributed evenly.

not that we should do that.
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Darkman124 posted...

FLUFFYGERM posted...

If you took all the wealth that was being "hoarded" by the wealthy and redistributed it, it wouldn't actually go very far. They don't have that much.

http://time.com/money/3919690/americans-total-net-worth-record/

for ref total networth (incl real estate) was 85T in 2015

it'd go farther than you might think

top 20% had 600k in 2011, or 120k/pp if distributed evenly.

most people have their money tied up in their home. so that doesn't seem meaningful or practical, because you can't redistribute homes in the same way you could redistribute cash. how much cash (or assets that can be sold, like office buildings and tractors and tools and IP) is there that could be redistributed across 330 million Americans?

Questionmarktarius posted...

FaytlessHearts posted...

lderivedx posted...

FLUFFYGERM posted...

You've bought into a delusion, propagated by idiot politicians who stand to benefit from riling people up.

Wages have been stagnant for 40+ years despite productivity and GDP per capita exploding. Life expectancy in the US has actually decreased in the last year or two. People are eventually going to get fed up with only a few people hoarding wealth.

Yup. Exactly. It's coming.

If we somehow magically confiscated all the wealth in the world, and redistributed the resulting $50000-ish per person to everyone, we'd be right back to radical wealth inequality within a decade.

so basically there's not that much that could be redistributed, which makes the concept of "hoarding" sound even more delusional

FLUFFYGERM posted...

most people have their money tied up in their home. so that doesn't seem meaningful or practical, because you can't redistribute homes in the same way you could redistribute cash. how much cash (or assets that can be sold, like office buildings and tractors and tools and IP) is there that could be redistributed across 330 million Americans?

I'm half tempted to attempt to illustrate this with Legos.

Ah more Admiral shitposting. Shocking. Didn't even try to defend it this time either, just ran off.
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Tag
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Darkman124 posted...

not really sure what would properly study this, aside from the idea that equity prices are driven by corporate earnings, not the other way around

but the idea Devsbro was positing was that the initial investments themselves is what is turned back into the economy. But I see what you mean now, when you say that IPO's are the only things that do that now. I agree that the way you and I may trade aren't huge driving forces in the economy, but I don't think that's the way the top 1% invests.

THEN AGAIN, I don't have a citation for that. At least I don't feel like looking shit up.
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Darkman124 posted...

FLUFFYGERM posted...

If you took all the wealth that was being "hoarded" by the wealthy and redistributed it, it wouldn't actually go very far. They don't have that much.

http://time.com/money/3919690/americans-total-net-worth-record/

for ref total networth (incl real estate) was 85T in 2015

it'd go farther than you might think

top 20% had 600k in 2011 from balrog's link, or 120k/household if distributed evenly.

not that we should do that.

I don't know if this is an appropriate way to calculate it, considering the 600k is a median and not a mean

all I can find in response to this question are medians and not means actually

e.g., in 2013 the non-home wealth in america was 40k per household (vs like 120k per household when inclduing homes as part of their net assets)

but those are medians and therefore don't say much about anything with respect to the super rich at all really
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Balrog0 posted...

I don't know if this is an appropriate way to calculate it, considering the 600k is a median and not a mean

This. Medians are almost always misleading.