Poor and middle class attitudes in America

simcha2

Mon, Nov 25 2019, 3:48 pm

leah233 wrote:

Warren Buffett pays so little taxes for three reasons

(1)he gives a lot to charity (his foundation)which greatly reduces his taxable income

(2)he creates many jobs. There are tax deductions and credits for creating jobs

(3)his income is almost all capital gains which is taxed lower for everyone rich or poor alike (for some lower income individuals capital gains aren't taxable to begin with)

Perhaps (3) is debatable but the poor are certainly better off with(1)&(2) staying in place rather than Buffet paying more income taxes

Except for 1) he's stated many times that he thinks his tax rate should be higher (and wouldn't reduce his charitable giving.
2) see above... and this is not his corporate tax rate, but his personal.

Last edited by simcha2 on Mon, Nov 25 2019, 3:53 pm; edited 1 time in total

amother

Papaya

Mon, Nov 25 2019, 3:49 pm

in fact we are not "so far from that"
for example, many small businesses took big hits during the previous administration changing of some of the rules/obligations and stopped expanding and hiring if not closing altogether
if big businesses or "billionaires" are hit then they just take their business and money out of the country and their jobs and tax revenue also

Mommyg8

Mon, Nov 25 2019, 4:02 pm

leah233 wrote:

I'm trying to understand how creating jobs affects his personal income tax rate....

In any case, for some interesting details of the methods that Berkshire Hathaway uses to very effectively lower their tax rate, this is an interesting read:

https://www.google.com/amp/s/w.....26092

And this:

https://millennialmoola.com/20.....time/

small bean

Mon, Nov 25 2019, 4:53 pm

simcha2 wrote:

Except for 1) he's stated many times that he thinks his tax rate should be higher (and wouldn't reduce his charitable giving.
2) see above... and this is not his corporate tax rate, but his personal.

He also has basically said he would not vote for warren or really anyone who is going to approach taxes in an unprofessional way.

simcha2

Mon, Nov 25 2019, 5:05 pm

small bean wrote:

He also has basically said he would not vote for warren or really anyone who is going to approach taxes in an unprofessional way.

Ok. Doesn't negate any of my points.

In general the very wealthy (the 0.1%) pay a lower tax rate than others, and there is no benefit to this. It is a burden on everyone else.

small bean

Mon, Nov 25 2019, 5:16 pm

In 2016, the top 1 percent of taxpayers accounted for more income taxes paid than the bottom 90 percent combined. The top 1 percent of taxpayers paid roughly $538 billion, or 37.3 percent of all income taxes, while the bottom 90 percent paid about $440 billion, or 30.5 percent of all income taxes.

They are paying the standard tax rates for their taxable income, they are just moving their money into nontaxable income. That has nothing to do with paying a lower tax rate. They just dont have only taxable income. I do the same thing. Every penny my husband makes goes into nontaxable income. We only pay taxes on my salary.

Amarante

Mon, Nov 25 2019, 5:26 pm

amother [ Fuchsia ] wrote:

Another classic liberal "I know better than you what is best for you" attitude

People with that attitude can only be trusted to take away money from the rich. Helping the poor is another story.

How does this kind of response add to the marketplace of ideas?

You labeled my ideas as generating from a political position you don't support and insulted me rather than actually explaining why taxing those could well reward it to provide benefits for the many is a bad thing.

I will just add that the kinds of benefits that would accrue by having more government funds are really only possible through government - funding for education and infrastructure.

Besides which - and I assume you call yourself a "conservative" - it was traditionally the conservative position that government deficits were an evil. Under the Republic "conservation" recent policies, the deficit has soared because tax revenues decreased and trickle down economics doesn't work. The corporate lowered taxation was justified as a way for corporations to reinvest that money in development - they didn't of course but generally used the windfall to buy back their stocks which benefited the wealthiest.

small bean

Mon, Nov 25 2019, 5:34 pm

While you can have a healthy deficit. The current deficit is not healthy and both parties are to blame. Any conservative who is not bothered by the deficit is not a real conservative. Any conservative that does not think we should be cutting out spending, closing useless government agencies etc is also not a conservative.

Trump actually said he likes deficits and did not run on cutting anything.

But the tea party ran on cutting the budget and when they were elected they continued to grow the deficit. This is why they fell flat. This is why I support amash.

simcha2

Mon, Nov 25 2019, 5:34 pm

small bean wrote:

This sounds really unfair, until you realize that the top 1% also hold the majority of the wealth. In fact, the bottom 80% only hold 7% of the wealth. (The top 1% hold 43%, so paying 37% is disproportionately low).

And as for moving to non taxable assets, these all generally prevent the transfer of income into the general economy, thus working against the trickle down effect.

small bean

Mon, Nov 25 2019, 5:43 pm

simcha2 wrote:

Again why is that not fair? Why should they give more of their money because they have more?

They are still funding a good portion of the budget and that is not for their personal gain alone, it is for the entire countries.

While yes not all of this trickles down it still lends to a stronger economy.

In America we all have a chance to be in the top 1%. Most of these people come in and out of the bracket as their income fluctuates.

If you are middle to lower class, you can do the same thing the wealthy is doing and pay an even lower tax rate. This is not only for the wealthy. Anyone can do it, that is what makes this fair.

I dont think wealthier people owe anything more to the government than poorer people.

simcha2

Mon, Nov 25 2019, 5:45 pm

small bean wrote:

But, why do you think they owe less?

(And no, most people don't have the chance to be in the top 1%, certainly of wealth)

small bean

Mon, Nov 25 2019, 5:52 pm

They owe less because their taxable income is less. They are not paying a lower rate in their taxable income.

Simple thing that many lower income people do is move money to a 401k, which is not taxable. You are now effectively paying a lower tax rate on your income. The wealthy is doing the same concept.

The argument is faulty as they are paying the tax rate for their taxable income. They are not paying a lower tax rate, their income is now lower. You dont pay taxes based on your wealth, most people's wealth are not sitting in cash.

And yes, you do have a chance, you may never get there but an educated adult has a chance.

small bean

Mon, Nov 25 2019, 5:54 pm

amother [ OP ] wrote:

Why should it have to be fair? If taxation is theft, is equal theft better than unequal theft?

Because the purpose of taxation is to pay to keep the country controlled.

Why should the rich pay more for the countries safety than the poor person?

Ravenclaw

Mon, Nov 25 2019, 5:55 pm

This is a very interesting thread and I am learning a lot.
I don’t have much to add as I don’t have a lot of info, so take everything I say with a grain of salt, but
A) I watched Park Ave documentary and they showcased a social experiment done with monopoly that showed how hard it is for people born into poverty to climb out of it
B) I don’t like the far left plans to tax the rich insane amounts 75%, in one plan I heard) either. That would kill the incentive to work and decrease jobs and investments. Taxing the rich too much (too much being significantly more than middle class) would be the downfall of the economy IMO.

That’s why I wish the government invested more social programs in building opportunities, helping people set themselves up financially, get educated... rather than simply handing out housing, food, and other programs.

Last edited by Ravenclaw on Mon, Nov 25 2019, 5:56 pm; edited 1 time in total

small bean

Mon, Nov 25 2019, 5:55 pm

I dont think they owe less. We all have the same tax code and equal opportunity to use it to our advantage. Why should they lose out on nontaxable income because their income is higher? Why should they pay a higher tax rate on their taxable income because their income is higher?

simcha2

Mon, Nov 25 2019, 5:57 pm

small bean wrote:

You are only able to move income if you have extra income to move. If people are living paycheck to paycheck they can't move income into retirement saving. Having that opportunity is already a privilege. As is having access to education that allows you to be in the 1%.

(See my original post with regard to aspirational thinking)

small bean

Mon, Nov 25 2019, 6:02 pm

Ravenclaw wrote:

This is true if you are very poor it will be hard to climb out of it because it means letting go of the safety net that you have. So for example you make 10k a year and thr government pays your housing, food, insurance, cell phone bill. So now your actual income is more like 35k. But when you jump to 20k, you lose that safetynet and you are still not at 35k, so now you are poorer than you were. The motivation and the inability to jump quickly, really makes it extremely difficult.

But there are millions of stories of kids growing up poor in the projects and becoming successful adults. That is the American dream.

amother

Emerald

Mon, Nov 25 2019, 6:03 pm

small bean wrote:

Every penny? How do you manage that?