Economics is Fun, Part 10: Taxation

[Peter1469]

Or perhaps the right to vote is attached to simply paying federal income taxes. That would eliminate ~50% of the vote off the top. Then we might get sensible government.

[Conley]

I'm partly on board with defensive spending cuts but it's the wars that are costing us a $#@!load. We cannot and should not slam the breaks on defensive spending - and I would include the space program in that mix also, which we've put the parking break on seemingly.

We need to cut defense spending. Just like all other government budgets, and especially because this one is a 'golden cow' it has become bloated and obese. No need to gash it, but it's time to trim some of the fat. Bringing our troops home would help this situation and have a lot more benefits as well.

[Chris]

Or perhaps the right to vote is attached to simply paying federal income taxes. That would eliminate ~50% of the vote off the top. Then we might get sensible government.

Actually the 50% not paying taxes is 50% of population total. Still, if liberals want to tax the rich, a good compromise would be weighing votes proportional to amount of taxes you pay.

[Conley]

Actually the 50% not paying taxes is 50% of population total. Still, if liberals want to tax the rich, a good compromise would be weighing votes proportional to amount of taxes you pay.

I say just close the loopholes. Everyone making over a certain amount of money pays a flat tax. Problem solved.

[Chris]

And better would be a consumption tax like the Fair Tax, imo.

[Conley]

And better would be a consumption tax like the Fair Tax, imo.

I think I agree, but if we discourage spending by adding to consumption taxes, won't that hurt the economy?

[Chris]

Less than disincentivising earning an income. I think.

[Conley]

Less than disincentivising earning an income. I think.

I hear you, but I'm thinking that the current tax rate doesn't discourage income growth the way a consumption tax would discourage consumption. For example, if you charge a 20% tax on buying a car, making it go from say 20k to 24k, people may well balk and begin looking for other places to buy the car cheaper. But applying that same 20% tax to income isn't going to make someone work less, at least IMO. I would prefer a consumption tax to income tax, but that's mostly because I consume very little. I don't know the economic repercussions and I think even those who claim they definitely do would see unexpected consequences.

[Chris]

Right, but taking away 20-30% of my paycheck already means I have less to spend. If I go up much in pay I go up another tax bracket.

[Conley]

Right, but taking away 20-30% of my paycheck already means I have less to spend. If I go up much in pay I go up another tax bracket.

But does anyone turn down a salary increase on such a basis?