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Comment by citilife | Hacker News Reader

> About 75 percent of Americans favor higher taxes for the ultrawealthy.

I for one, am glad the majority can't just decide what the taxes are. It's a balance in society, but the general rule I personally have is live and let live. I don't want hand outs, I don't want to take peoples money at the point of a gun unnecessarily. I also regularly give to my community, by choice. I think it's important to respect one another and increasing taxes on a neighbor because they make more, doesn't seem fair. Maybe they worked harder, maybe they were born in a better position in life. It doesn't matter, by the time your 30, it's mostly what you did with your life that got you there. Let's not be petty and try to force our neighbors to pay us.

I feel something like 20% of your income a year, for everyone making over livable wage seems fair (livable wage meaning, average cost of food + minor shelter for the average in said country). Then just close all loop holes. As in, you have to pay 20%, no complaints after you make $15k or something (in the U.S.). That'd probably >2x tax revenue and be "fair" to everyone.

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For people downvoting this, consider that it can (and should IMHO) be possible for citilife to live in a system where this is the case, and for you to live in a system that meets your needs as well. I don't understand why so many people are convinced that a giant state imposing one-size-fits-all on a hugely diverse population is a good idea. The United States particularly was founded on the idea of a tiny federal government where most things were decided by States, so people could freely move to the government that best fit their needs.

Some further reading:

https://en.wikipedia.org/wiki/Voluntaryism

https://en.wikipedia.org/wiki/Panarchy

> For people downvoting this, consider that it can (and should IMHO) be possible for citilife to live in a system where this is the case, and for you to live in a system that meets your needs as well. I don't understand why so many people are convinced that a giant state imposing one-size-fits-all on a hugely diverse population is a good idea. The United States particularly was founded on the idea of a tiny federal government where most things were decided by States, so people could freely move to the government that best fit their needs.

I totally agree with this BTW. That's in part why I made my comment in the first place. I don't want to see massive taxes federally and I actually left California because of the crazy laws / taxes.

These polling questions don't typically distinguish between federal and state governments. They ask whether some policy is approved of (usually with the implicit understanding that it will be free to the voter). The author's proposition that if 2/3 of the voters want something, they should get it is the road to chaos, because "it" is never precisely defined, and the concrete consequences are never made clear. Democracy is good for picking representatives, and not great at that but better than a monarchy.

"Fifty states, fifty laboratories" falls over when the foolish ones come with their hand out. See Kansas and their Sam Brownback disaster.

This is, ultimately, why I expect that most federal systems beyond a certain scale will fail: because the federated, without counterbalancing factors like "national unity" or "the barest sense of shame," will use, and then abuse, the federal safety net at the expense of everybody else. (See yesterday's arguments of "well, why should SALT be deductible?"--where states more impacted by SALT deductible reductions generally pay in more despite their increased state and local taxes.)

At that point, I expect that the collapse of the federated will necessitate federal and state conglomeration. I don't have a good idea on what timeline we will collectively realize this, though.

I agree with you, but I'd say that's more a defect in the US Constitution that permits one state to plunder another. If the federal government were not allowed to redistribute wealth from California to Kansas (or vice-versa depending on your politics) then the issue would be moot because foolish people with their hands out would be there all day with no power to act on it.

Actually, are you saying that doing away with the federal system altogether is the only sane approach (or letting it fail and not re-instantiating it)? If so, I think I agree

I don't know about "only sane", but I expect it to happen. Conglomeration is probably inevitable, in fact if not name, with the federal government assuming more and more of those roles just because of the economies of scale.

If it's possible to live in a system where the rich aren't properly taxed, the rich will choose to live in that system. Thus no one can live in a system that does tax them fairly, because the system that tries to does not have any rich people to tax.

I respectfully disagree. People aren't simply motivated by taxes -- there's other things like friendship, society, sense of purpose, opportunities, their place of business and the country they live in as a whole. Further, perceived value of money operates on a logarithmic scale so for someone with $2M in income $1M is a lot of money to take, but for someone with $100M $1M just isn't. I don't think you've factored in a whole lot of aspects. For instance, the top tax rate in Denmark is 62.5% and yet they have wealthy people -- why aren't they all in Hong Kong or Singapore or Malta or Gibraltar?

The hyperbolic example is "the only place that won't tax me is this deserted island, so peace boys, it's just me and my money over here." Feels a bit unlikely doesn't it?

There are places with truly nominal taxes already (Saudi Arabia for one), so why aren't all our rich people ... there in one big pile already?

You're right, I simplified way too much. Of course taxes are not the only factor in play. Indeed, I hope that I overestimated their inpact. Also I didn't expect the top taxes in Denmark to be that high.

> the system that tries to does not have any rich people to tax

Ah, I've always wondered why there aren't any rich people in New York or California. I guess this explains it.

And Xeno's arrow never hits its target, either...

This is a purely a priori argument, and ignores the manifest reality of the distribution of fantastically wealthy individuals in some of the highest-tax jurisdictions in the world.

> I don't understand why so many people are convinced that a giant state imposing one-size-fits-all on a hugely diverse population is a good idea.

The people who are convinced of this are the people who stand to benefit from it. People who rely on benefits that require a large population to support them (for example, Social Security and Medicare) will want to have a large population supporting them. But that means one-size-fits-all has to be imposed on that large population. If people could choose whether or not to contribute to those benefit programs, many would choose not to, which would decrease the available benefits.

> so people could freely move to the government that best fit their needs.

That requires a certain level of callousness. If New York State got universal health care (for instance), I'd be happy—but I would still push for it to be supported at a national level, so that people in other states could benefit.

I think your heart is in the right place, but this is the same mentality that has the US trying to "export democracy" all over the world, and it's causing tremendous damage and suffering. I think we need to accept that we Americans don't know what's better for everybody else. Different culture, different values.

Why not instead work toward universal health care in New York, and then invite people to move there? Then you get to help people, but you aren't being tyrannical against the people that don't want universal healthcare.

> Why not instead work toward universal health care in New York, and then invite people to move there?

Like I said, that requires a certain level of callousness.

Would you support having New York State work toward forcing all other states and countries to adopt universal healthcare that meets your standards?

If so, then I think you're being consistent but I would also suggest that you look into the history of colonialism and how many of the residents of the countries under rule felt about it (Gandhi did a lot of writing on this for example).

If not, how do you avoid being labeled "callous" using your own standard? Do you not care about the people in other countries as well?

> If so, then I think you're being consistent but I would also suggest that you look into the history of colonialism and how many of the residents of the countries under rule felt about it (Gandhi did a lot of writing on this for example).

Colonialism and health care aren't the same thing, though—colonialism was an attempt to exploit other people for your own profit, the point of spreading universal health care would be to let people have better medical treatment at more affordable prices. There is actually a difference between good things and bad things.

> If not, how do you avoid being labeled "callous" using your own standard? Do you not care about the people in other countries as well?

Well, the simplest metric would be this: that there's no political body that someone in another country and I both belong to.

> colonialism was an attempt to exploit other people for your own profit

This is a significant over-simplification. There was an element of this, but it was also broadly understood to be "civilizing" lesser cultures and bringing them into modern standards. There were quite a few arguments put forward that it was the compassionate thing to do. One could make a case that cultures who reject universal healthcare are uncivilized, therefore we should go in and force them to become enlightened like us.

> There is actually a difference between good things and bad things

That's quite the straw man, and also seems to pre-suppose that there is objective morality, or objective good and bad, and that the viewpoint you have arrived at is the only objectively correct view.

> there's no political body that someone in another country and I both belong to

It sounds like you are saying "it's too hard or complex" because they are different political bodies (please correct me if I misunderstand you here) so it's not worth doing. If you truly cared, would it not be worth taking over their political body to force them to be more compassionate to their people?

Perhaps another thought, what if someone in a heavily Christian southern state, who knows that they have the truth of Jesus Christ on their side (i.e. they are certain of their morally superior position), decides that New York is immoral and calloused for permitting abortion. Would you support them working at a federal level to ban it nationwide? Surely they believe not doing so is callous. How do you argue against that?

By the way, thanks for the conversation. I love being able to talk to people with different viewpoints :-)

> There was an element of this, but it was also broadly understood to be "civilizing" lesser cultures and bringing them into modern standards. There were quite a few arguments put forward that it was the compassionate thing to do.

Yes, I'm sure there were plenty of colonizers who thought they were doing the right thing, but there were plenty who did not, who had no concern about the lives of the people they destroyed through slavery and genocide. The fact that some of them might have had good intentions in midst of all the death and oppression doesn't change what they did.

> One could make a case that cultures who reject universal healthcare are uncivilized, therefore we should go in and force them to become enlightened like us.

I'm not sure what you mean by "force" here—are you talking about slavery or genocide? Military takeover?

Or do you mean something like "show them the results, and convince them it's a good idea"?

> seems to pre-suppose that there is objective morality, or objective good and bad, and that the viewpoint you have arrived at is the only objectively correct view

That's also a straw man. You don't need to believe in a single objectively correct view to decide that "affordable medicine" is better than "400 years of brutal oppression". If my ruler can't determine which of two lines is longer when they're less than 1mm different, that doesn't mean it can't determine that a 2cm line is shorter than a 10cm line.

> It sounds like you are saying "it's too hard or complex" because they are different political bodies (please correct me if I misunderstand you here) so it's not worth doing.

Not that it is, or isn't worth doing—just that it's a very different thing. Is it too hard or complex? Well, it's certainly a lot harder and more complex. Too hard or complex, I have no idea.

> If you truly cared, would it not be worth taking over their political body to force them to be more compassionate to their people?

That sounds like one of those foolish "if you could go back in time to kill Hitler" thought exercises. And it has the same answer—if you could do that, then you could also stop him without killing him.

Similarly, if you wanted to convince people that more affordable access to health care is a good thing, you don't need to take over their country.

> what if someone in a heavily Christian southern state, who knows that they have the truth of Jesus Christ on their side (i.e. they are certain of their morally superior position), decides that New York is immoral and calloused for permitting abortion. Would you support them working at a federal level to ban it nationwide?

I'm not sure if you've been reading the news lately, but that's what they've been doing. So they're definitely not waiting for my permission.

> Would you support them working at a federal level to ban it nationwide? Surely they believe not doing so is callous. How do you argue against that?

I'm not sure why I would need to—yes, they think it's a lot worse than callous. Them being convinced of their morally superior position doesn't mean that I am convinced of their morally superior position.

> I'm not sure what you mean by "force" here—are you talking about slavery or genocide? Military takeover?

> Or do you mean something like "show them the results, and convince them it's a good idea"?

Good question, I think our disagreement may actually come down to how we view the definition of "force".

I did mean the former (military/police force). I think the latter is the best (and only moral) way to get things done (winning hearts and minds). But where we may differ is that I believe even democratic laws are force because they are ultimately enforced by police agencies at the barrel of a gun (or threat of imprisonment).

So I don't really see a philosophical difference in imposing universal healthcare at a federal level on a State (pick any conservative state for example) who doesn't want it, or invading another country militarily and forcing them to do it. Both result in the imprisonment or death of people who refuse to be assimilated.

That's why I argue for doing it at the lowest level possible, such as New York State or even better maybe NY City. If somebody wants to "opt out" they can move, which isn't a great solution, but it's certainly easier to move out of the city or state than to move out of the country.

Then at the same time we can evangelize for universal healthcare and demonstrate with our own state that it can work. Once it's proven, I bet many other states would adopt it as well. This extends beyond healthcare IMHO to almost every other facet of law.

> So I don't really see a philosophical difference in imposing universal healthcare at a federal level on a State (pick any conservative state for example) who doesn't want it, or invading another country militarily and forcing them to do it. Both result in the imprisonment or death of people who refuse to be assimilated

Huh, interesting. Well, how about this: let me off you a 2-for-1 deal. You get to strike 2 laws of your choice off the books, in exchange for 1 military invasion of your state. Federal laws, state laws, hell maybe you really don't like your hamlet's zoning regulations, whatever. Your choice. In exchange for... let's say, 10 years of Iraq-style military invasion & occupation (the US invasion of Iraq, I mean, not Iraq's invasion of Kuwait). We've been there for over 15, but 10 is a nice round number. 1-for-1 is a wash, sure, I get that, but 2-for-1 seems like a good deal. What 2 laws would you pick?

> Once it's proven, I bet many other states would adopt it as well. This extends beyond healthcare IMHO to almost every other facet of law.

Interesting—so you think that the objections to universal health care are that people don't think it'll work?

But a system of philanthropy is inherently biased insofar as since donors can and do choose charitable causes that match their own preferences. Taxation is necessary (also) to redistribute from taxpayers to reciprients in an (ideally) unbiased and (in the real world) somewhat tempered by democratic representatives.

That’s part of the reason why American and increasingly European politics have become so factious.

> But a system of philanthropy is inherently biased insofar as since donors can and do choose charitable causes that match their own preferences.

Anand Giridharadas goes pretty deeply into that idea in this talk that he did at Google. I highly recommend watching it, I thought it was elucidating.

https://www.youtube.com/watch?v=d_zt3kGW1NM

I want to read his book "Winners Take All: The Elite Charade of Changing the World" but I haven't gotten to it yet.

You're not wrong, but I'm trying hard to place this comment. The commenter you responded to said nothing about philanthropy. In fact, some interpretations of 'live and let live' would explicitly bar philanthropy.

The GP said "I also regularly give to my community, by choice."

Yes, you're right. I see how you could interpret that as philanthropy.

Yup.

The OP mentioned his giving to his community on a voluntary basis. That sounded like an operative description of philanthropy so I used that term.

Of course there is the fine point that taxation is not voluntary, and that 'ideally' means 'never happens'. The presumption that the government will be 'more ideal' than a philanthropist is silly.

Uhm... I think you misunderstood me. Ideally cynically meant ‘never’ and “at least tempered by democratic representatives” was the most neutral but compact phrase I could come up with to describe what apparently happens when averaged across the parliamentary democracies of the world.

As for taxation not being voluntary, I never said it is. Nor should it be. Which billionaire would take on the cause of fixing potholes?

> But a system of philanthropy is inherently biased

More importantly, philanthropy suffers from the tragedy of the commons. It's in everyone's interest to act selfishly, and those who do not are put at a disadvantage and will be outcompeted.

I think it boils down to "let's look at all of the problems we have for citizens in our nation".

People in debt who can't afford to feed their families/pay their mortgages, homeless people, sick people.

Ok. How do we solve these problems? Money.

Who has money? Ultra rich. How much money do they really need? You've got somebody buying a $100m superyacht and somebody who can't afford to eat living within the same nation.

I'm not saying I agree with this method of thinking 100%, but I think it's where the "we should tax the ultrawealthy" mindset comes from. Where else are we going to get the money? By the government pulling it out of a hat? That's bad for everybody. The ultrawealthy giving up some of their millions isn't super noticeable for them. On top of that, if 1 billionaire gets taxed at 75%, how many impoverished people does it stand to help?

> if 1 billionaire gets taxed at 75%, how many impoverished people does it stand to help?

Not enough. That's the fundamental issue with all "tax the wealthy" proposals: the wealthy don't have enough money to fix all the problems the tax-the-wealthy people want to fix, even if they were taxed at 100% of their income and no loopholes. So "tax the wealthy" always ends up looking more like "tax the middle class", which does more harm than good.

I'd be curious to see the numbers on this.

I thought 99% of the wealth belonged to 1% of the population or something crazy. Are you sure taxing the middle class would bring in more than taxing the ultra richer?

> I thought 99% of the wealth belonged to 1% of the population or something crazy.

If you're talking about taxing wealth, that's a very different thing from taxing income. I was thinking of income.

The tax foundation summary of tax year 2016 [1] gives a good overview of the breakdown of income and federal income tax. The top 1 percent of earners had about 20 percent of reported income, and paid about 37 percent of income taxes received. But the income split point for the top 1 percent is only about $480K per year. Most of those people are not billionaires or even close to it. The share of income taxes paid by billionaires is much smaller.

The issue with trying to tax wealth, instead of income, is that you can only tax it once and spend it once, and then it's gone. So unless you have some really obvious one-time expense that that wealth can buy you and that will benefit everyone enough to make it worthwhile to pay the political cost, it's just not feasible.

[1] https://taxfoundation.org/summary-latest-federal-income-tax-...

Why can you only tax wealth once? I pay tax on my home every year. It hasn't gone anywhere. I'll pay taxes again on it next year. How is the tax I pay on my home different than a tax on total assets?

> Why can you only tax wealth once?

Because once you tax it and spend it, it's gone. But see below.

> I pay tax on my home every year.

You don't pay it by selling your home and giving the government a percentage of the proceeds. You pay it out of your income. Nor does your paying property tax on your home reduce your home's value. So it's really an income tax, not a wealth tax--an income tax that is (implicitly) determined by the government's judgment of how much of your income it can extract from you based on how expensive a home you own. Paying the tax doesn't reduce your wealth.

To the extent that a wealthy person could do the same--pay a so-called "wealth tax" out of current income, without having to sell any assets--it could be taken the same way; it would really be an extra income tax that very wealthy people pay, an income tax that is (implicitly) determined by the government's judgment of how much of a very wealthy person's income the government can extract based on the value of the assets they own. Paying the tax wouldn't reduce the person's wealth.

But I don't think the people who are pushing a "wealth tax" are thinking of it that way. I think they are thinking of it, long term, as a way to force very wealthy people to sell assets and give the proceeds to the government, which will then redistribute it somehow. And once you reach that point, where the tax can only be paid by selling assets, then what I said applies: you can only tax it and spend it once, and then it's gone.

> Because once you tax it and spend it, it's gone.

Where did it go? Did the government burn my tax dollars in a giant bonfire? Tax money doesn't disappear. It gets spent on things like schools, hospitals, the military, fire departments, police departments, SCHIP, roads, NASA, etc. You can argue about where exactly the money should go but it all ends up back in the economy.

> > I pay tax on my home every year.

> You don't pay it by selling your home and giving the government a percentage of the proceeds. You pay it out of your income. Nor does your paying property tax on your home reduce your home's value. So it's really an income tax, not a wealth tax

If I lose my job and run out of savings that's exactly how I pay it. Trying to call it an income tax because I have income is a poor way to reframe it.

> But I don't think the people who are pushing a "wealth tax" are thinking of it that way. I think they are thinking of it, long term, as a way to force very wealthy people to sell assets and give the proceeds to the government, which will then redistribute it somehow.

I don't see this as a major problem. If I own a $100 million dollar yacht and have to sell it to pay a 1% wealth tax I would still have $99 million left. If I can't find some way to make money off of that $99 million before it gets chipped away to almost nothing at 1% a year then maybe it would be better for that money to be spread around instead of concentrated somewhere it isn't being efficiently used.

> Where did it go?

It bought something, presumably. (That's if it didn't end up in the pocket of some politician or one of his cronies, or a lobbyist, or...)

> You can argue about where exactly the money should go but it all ends up back in the economy.

Yes, money circulates around indefinitely, but money isn't wealth.

> If I can't find some way to make money off of that $99 million before it gets chipped away to almost nothing at 1% a year then maybe it would be better for that money to be spread around instead of concentrated somewhere it isn't being efficiently used.

If the government actually did make more efficient use of money than individual taxpayers would, I might buy this. But very little of what the government does meets that test.

Also, if you're making money by creating wealth using your $99 million starting stake (say you start a business with it, for example), and paying the wealth tax out of that, then you're doing what I described before: you're paying the tax out of income, not wealth. More generally, if people keep on creating wealth faster than the government is taxing it, then yes, there's no problem (or at least, not the problem I was trying to describe). But that's the situation I was describing when I said the tax is really an income tax, not a wealth tax. (I agree that "income tax" vs. "wealth tax" is not the best terminology to use to describe this distinction, but it's what we have.)

> Then just close all loop holes

One man's loophole is another man's incentive. If you are struck by catastrophic medical issues and pay more than 10% of your AGI in medical bills, you can deduct the cost. Is this a loophole? Or is this a way to cushion the blow of having been dealt a lousy hand in terms of medical costs? It depends on your perspective.

> That'd probably >2x tax revenue and be "fair" to everyone.

From an economic perspective, it's great to "lower the rate and broaden the base". The problems come when, after the rate has been lowered, lobbyists get all the same incentives/loopholes put back in. Now you have a lower rate, and many of the same carveouts.

> One man's loophole is another man's incentive. If you are struck by catastrophic medical issues and pay more than 10% of your AGI in medical bills, you can deduct the cost. Is this a loophole?

No, it's just badly broken, arbitrary, unnecessary complication. Deductions are sensible for essential costs, but healthcare doesn't magically become essentially when it crosses the 10% AGI threshold; it makes sense for healthcare costs to be deductible period.

> it makes sense for healthcare costs to be deductible period.

It's also hard to draw lines. Is Viagra covered, for example? This is one of the reasons there's a threshold — to make sure the deduction is only being granted where there are non-routine expenditures. The tax code views some level of medical expenditures as routine, and therefore non-deductible.

> It's also hard to draw lines

It's easier if you don't draw unnecessary and illogical lines to start with, which is what the dollar threshold is.

> Is Viagra covered, for example?

Apparently, if you buy enough relative to your income.

> This is one of the reasons there's a threshold — to make sure the deduction is only being granted where there are non-routine expenditures.

Which is both a dumb idea and not done well by a share of income rule.

> The tax code views some level of medical expenditures as routine, and therefore non-deductible.

Routine expenditures being non-deductible isn't an intelligent rule; if it is a kind of expenditure that should be deductible, being routine doesn't really change that. If it is a routine expense that is assumed covered by the standard deduction, then you just require itemization to take a specific deduction for the purpose; we don't need special handling for something for which we already have a better and more general solution.

It makes sense for healthcare costs to be socialized period.

I strongly disagree with the idea that success by 30 is mostly based on personal choices. There is plenty of evidence that your income as an adult is correlated to your parent's income [0].

[0] https://www.brookings.edu/blog/social-mobility-memos/2018/01...

“it's mostly what you did with your life that got you there“

This is simply not consistent with facts. Where you are born, what education you got, and what risks you were able to take has a huge impact on success.

> This is simply not consistent with facts.

Is it really a "fact" though? I know there are studies out there and that it's a popular opinion. The question is, why? There are near infinite factors impacting "success" and "success" is fluid, but also any statistics used are correlations and generalizations at a massive scale.

My point, is that we cannot begin to determine each case independently. Instead, we should uniformly tax the society for funding society. The ultrawealthy will pay more on a percent based system, the upper, middle, and lower classes will progressively pay less.

> Where you are born, what education you got, and what risks you were able to take has a huge impact on success.

Also, I've seen this thrown around - let's assume this is true. I tend to agree, but you also have to recognize that by 30 years old, we shouldn't be treating people like children. By 30 it's entirely possible making minimum wage to attend college or to take risks. It may have been harder or they may have had to work hard, but there's no reason to make the argument the opportunity wasn't there, because it typically is.

> By 30 it's entirely possible making minimum wage to attend college or to take risks.

This is a mighty big leap ... many minimum wage jobs have erratic schedules that make attending classes difficult, let alone barely paying you enough to eat and have housing. God help you if you start a family.

> By 30 it's entirely possible making minimum wage to attend college

It may be, barely, depending on the state you live in[1]. But presumably no one would argue that it would be a lot easier if your family had the means to help you...

1: https://www.chronicle.com/interactives/Minimum-Wage-Work-Alo...

> It may have been harder or they may have had to work hard, but there's no reason to make the argument the opportunity wasn't there, because it typically is.

This a a fallacy. The difference between pulling yourself up by your bootstraps or not is far more than just "how hard you work". Similar to a successful start-up, hard work is a prerequisite but not sufficient.

In reality, that opportunity is just frequently not there for many poor people, regardless of how hard they work. Yes it is there for some people and some of those people fail to work hard enough to take advantage of it. However, the belief that people are poor because they are lazy is generally false and quite disrespectful.

You want to see taxes as money being taken at gun point. That is sorta true, but then you must also be opposed to debt collectors being able utilize those same guns to collect on their loans?

In my view, our ability to make money is inherently dependent on the society we live in. You can't make millions without customers or infrastructure or educated workers or the rule of law. As such, wealthy individuals owe a debt to society for helping them acrue and keep that wealth. That debt is what justifies taxing that wealth. There is a good deal of evidence that the sort of broad investments you can make with that money have incredibly high returns for society and the ability for individuals to accumulate wealth.

I think we agree that the money is best spent investing in providing more opportunities to society rather than encouraging bad choices and laziness.

> I tend to agree, but you also have to recognize that by 30 years old, we shouldn't be treating people like children.

But we should be treating children like children and in America they largely inherit the disadvantages of their parents.

> It may have been harder or they may have had to work hard, but there's no reason to make the argument the opportunity wasn't there, because it typically is.

The evidence disagrees. Our Kids by Robert Putnam examines this exact issue. While there are many, here's a particularly sobering quote from the book: "high-scoring poor kids are now slightly less likely (29 percent) to get a college degree than low-scoring rich kids (30 percent)."

Given that the ultrawealthy tend to make their money from capital gains and go through great efforts to reduce their taxable income, I suspect that your proposal to tax everyone at a flat 20% would actually raise taxes on the ultraweathy, and thus you are among that 75% you’re trying to argue against.

A flat tax rate is a bad idea, because as your wealth increases the incremental utility of money decreases. This is why we have a marginal tax rate system in the US. The highest rates only apply to the portions of income greater than $500k.

The utility of time, however, stays fixed. We've all got something like 75 years to live. A flat tax of 20% takes one-fifth of a working week for the public. And, really, why should 2 days be taken from person X while 1 day is taken from person Y?

Why is one day of person X's time worth more than person Y's?

Time and money are different things. Many people are not paid on a time-basis. Taking 20% of the earnings of a minimum wage laborer working 80 hours a week is much more burdensome than 20% of the wages of a stock broker who makes $1M/year with their bonuses.

If you don't like the majority deciding on taxes, you don't like democracy.

“Democracy is two wolves and a sheep voting on what to have for dinner.”

http://freakonomics.com/2010/08/12/quotes-uncovered-if-wolve...

In more ways than one. Lets say one wolf is kind of smart and realizes it's a multi-round game, and that after they eat the sheep there won't anything else for them to eat except each other. What does that wolf do then? And what if it occurs to him that he can't be sure that the other wolf hasn't realized this too?

Good analogy. A wolf majority results in sheep being eaten with or without democracy because the wolves are more powerful. A sheep majority can save the sheep from the wolves only in a democratic system where the wolves respect majority rule.

By the way, rich people are wolves, not sheep.

Everything else is one wolf eating two sheep.

What about a system where wolves aren't allowed to eat sheep, and everybody just chooses for themselves what to have for dinner (so long as that choice doesn't involve coercing someone else)?

Nobody "allows" wolves to eat. They do it unless they are stopped. As such, such system exists except in fantasy-lands where neither politics nor economics exist.

In that case the sheep starve, because the grass is a wolfs private property.

I don’t think literal direct democracy is a good system for nations. That’s why there are so many parliamentary systems or republics.

So it’s ok to not “like democracy.”

Democratic principles are a different story. I like representation and justice.

Which is part of why the USA is a representative republic.

Is it not also a democracy?

Discussed directly in TFA:

"Others remind us that the United States is a democratic republic, not a direct democracy, and that the Constitution was designed to modulate the extremes of majority rule. Majorities sometimes want things — like bans on books, or crackdowns on minorities — that they should not be given.

This is true. It is also true that a thoughtful process of democratic deliberation and compromise can yield better policy outcomes than merely following the majority’s will. But these considerations hardly describe our current situation. The invocation of constitutional principle has become an increasingly lame and embarrassing excuse. The framers of the Constitution, having experienced a popular revolution, were hardly recommending that the will of the majority be ignored. The Constitution sought to fine-tune majoritarian democracy, not to silence it."

That's called a regressive tax system.

Actually, no it's not. The poor are taxed at the same rate as the wealthy. Regressive, is that they are taxed more.

I'm suggesting that we take substantially more from the ultra wealthy; many of whom already pay <15% tax. I'm also suggesting we tax the middle class less as well (who often pay more by percentage >15%) and the poor don't pay taxes until after they make a "live-able wage", i.e. only after they can afford food and shelter do we tax.

A flat 20% tax rate, plus removing loop-holes or tax refunds would dramatically impact the wealthy and middle class. Then we drop taxing the poor (which the U.S. already does).

I think it's naive to think we should just "raise taxes" to disproportionately take from the people who have money. They may have earned it, I don't want to take their wage, any more than I want to take from someone who works in the field all day.

Ignoring marginal utility is absolutely regressive.

The income tax would not be regressive, but the overall tax system (including sales tax, gas tax, and other consumption or usage taxes) would be regressive.

That isn't to say that regressivity is a fatal flaw — tobacco taxes and other "sin taxes" are all regressive, but they're seen as good because the goal is to discourage behavior, not raise revenue.

Definition of "regressive tax": A tax that takes a higher percentage of income from low-income earners than from high-income earners.

By definition, the tax system in the post you replied to is not a regressive tax system.

That is a poor definition of a regressive tax. A better definition is "a tax that ignores the marginal utility of income in its application".

Poor people derive overwhelmingly more value from dollar $10,001 than rich folks do from dollar $1,000,001. (This is not controversial.) Thus, rich folks can--and should because they derive more value from the structures of the society that enables them to be successful and not hit over the head for their paycheck--pay progressively more to sustain that society. (This is also not controversial in reality, even amongst relatively right-wing economists.)

The definition I gave is, nonetheless, the accepted definition of the term. Can't find a citation for yours.

(Note: I do understand about utility, and how/why progressive tax systems help society. My only bone of contention here is that you're trying to redefine a specific term to have a different meaning.)

"While a flat tax imposes the same tax percentage on all individuals regardless of income, many see it as a regressive tax. A regressive tax is on which taxes high-income earners at a lower percentage of their income and low-wage earners at a higher rate of their income. The tax is seen as regressive due to a more significant portion of the total funds available to the low-income earner going to the tax expenditure. While the upper-income payer still pays the same percentage, they have enough income to offset this tax load."

https://www.investopedia.com/terms/f/flattax.asp

The marginal utility of income is not measurable, whereas the percentage of income that gets paid as tax is. That's why "regressive" and "progressive" taxation is defined in terms of the measurable thing, not the unmeasurable thing. What you're saying is simply that a progressive tax system is better because it attempts to take into account the marginal utility of income.

And then everyone starts arguing about how progressive the system should be to do that properly. :-)

ISTM a system that differed from the current one by really "closing all loop holes" would be significantly less regressive. Of course, there isn't a snowball's chance in hell of that actually happening in our Congress, but the vision is admirable even if isn't practical.

> I for one, am glad the majority can't just decide what the taxes are.

The majority are those who work and create wealth. The minority are the heirs who expropriate surplus labor time from those who work. It is an old idea, James Madison wrote the initial draft of the US Constitution and said it was meant "to protect the minority of the opulent from the majority".

Hand outs and taking people's money at the point of a gun is what the heirs do from those who work and create wealth. Larry Page talks about how the police encircled the auto plant his hammer-armed grandfather was on strike at.

"By the time your (sic) 30, it's mostly what you did in life that got you there" - sure like Trump and his small million dollar loan from his dad, W. Bush and his drinking and failed businesses before a government deal for a sports stadium. We see these self made by 30 men as our recent presidents.

We have income earned by labor, and "income" expropriated as a Rentier - rent, interest, profit. We know this as workers pay higher taxes on their earned income than heirs do for their unearned income.

The parasitism is by the heirs who do not work upon us who do work. It has not much to do with money or material - it is a relationship - the expropriation by the heir of the surplus labor time of the worker.

> We have income earned by labor, and "income" expropriated as a Rentier - rent, interest, profit. We know this as workers pay higher taxes on their earned income than heirs do for their unearned income.

It is incredibly difficult to interpret this as a critique of what the commenter wrote, when he explicitly called for a flat tax rate.

It refers to a flat tax on income and wages, which matter little to the wealthy. Capital gains are where the real money lies, and they're so hard to define that you can't call "no loopholes" on them.

> Capital gains are where the real money lies, and they're so hard to define that you can't call "no loopholes" on them.

Well the government does quite the job right now and also taxes them at a lesser rate.

>Hand outs and taking people's money at the point of a gun is what the heirs do from those who work and create wealth. Larry Page talks about how the police encircled the auto plant his hammer-armed grandfather was [striking].

Would Larry appreciate a 75 - 90% tax on his earnings over ${rich_dude_income_threshold}? I'm not sure we can pass a law that taxes proletarian-grandkids-made-good at a lower rate than trust fund babies.

I will agree with your implicit point that if we tax income, we treat wages and capital gains equally.

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