Conservatives are quite right that taxes are wealth redistribution. They just don't realize how this benefits all Americans.
"When the household is so far in debt," the conservatives' argument goes, "you can't go printing more money. You have to cut spending."…
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26 - Igor
@24-Dave: what nonsense this post is filled with!
Income inequality is, of course, a myth.
You can't seriously say that my perceived income inferiority to Romney is mythological! Does Mitt have just a mythological 5 car garage on a California beach?
It assumes that there is a basis for comparison between income from wages and income from investments when there is no such basis.
Of course there is, and the IRS tax laws go to great lengths to specify that comparison, as well as extensive case law, and, BTW, to legislate in favor of investments over mere work.
It's like comparing apples and oranges.
A perfectly valid comparison. Five apples is the same quantity as five oranges. Repeating a brainless metaphor does NOT improve it's veracity!
It's the equivalent of saying that I am richer than you are because you earn $50,000 a year and I have 3 cars. It's pure nonsense tailored to serve a divisive political agenda.
A silly example. In our capitalistic society 3 cars may well be worth more than $50,000, both because their liquid value may easily be several times higher, and our capitalist economy has many ways to amortize time-dependent incomes to make exactly such comparisons possible. Late night TV is full of ads from guys willing to exchange your lottery winnings for hard cash.
Yipes!
27 - Christopher Rose
Income from wages is obviously different to income from investments.
Money put into investments has already been earned and taxed before it was invested.
28 - Clav
Money put into investments has already been earned and taxed before it was invested.
Bears repeating.
Over and over again...
29 - Glenn Contrarian
Chris and Clav -
Money put into investments has already been earned and taxed before it was invested.
By the same train of illogic, ALL money has been earned and taxed before anybody (after its first possessor after it was minted) got their hands on it, and so there should never be any taxes, ever (which y'all will probably think is a great idea, never mind the glaringly obvious difference between the socialized democracies with high taxes as compared to the the ones with low taxes, small governments, and little or no regulation)! Y'all really need to learn when your excuses hold no logical water whatsoever.
What is taxed, people, are earnings, whether those earnings belong to the guy who earned a paycheck busting his butt as a fry cook, or 'earned' dividends belonging to the guy sitting on his can on a beach in the Mediterranean.
Comments #27 and #28 are not sound reasoning - they're excuses and nothing more.
30 - Christopher Rose
Glenn, when it comes to illogic, few can ever even hope to match you.
Perhaps when you come down from your weird flights of excessive exuberance and total irrationality, there will be some hope of a sensible or at least practical conversation. I'll let you know if and when y'all manage to sober up...
31 - zingzing
well, he's right about the "earnings" bit, chris. there's no real reason why hard work should be taxed more than letting your money make money. seems kinda counterintuitive. (and yes, i have investments.)
32 - Cindy
I'm not sure what the point being made here is.
Income from already taxed money is somehow different than income from earning a wage? The income from the already taxed money has not yet been itself taxed, therefore it is no different. It is all income.
Say I spend 100k of money that gets earned and taxed to get an education as my investment toward earning a wage, I buy a car and gas and insurance to get to said wage earning facility, I buy suitable clothing, pay for day care, all to enable me to earn income, all paid for with taxed funds--then what?
33 - Cindy
If I invest my already taxed money in a farm or a business, I am still investing taxed money to generate income. Yet, I will not be taxed at a lower rate than a wage earner on that profit.
Even if I save all my money and start a corporation, and that corporation earns a profit, that profit will be taxed much like a wage-earner, not like capital gains. I have seen no IRS rule stating that because I opened my corporation using post-tax money, its earnings will be subject to limited taxes.
I say, if I invest money into my grandson, giving him food and shelter, so that he may survive to work at the deli--likewise, my investment is made in post-tax dollars.
To arbitrarily claim that capital gains income deserves a special treatment, is just that, arbitrary. Why not interest income? Do you not lend money that is post-taxation earnings? Why then does interest income get taxed at an earnings rate?
The post-earnings, post-tax argument seems capricious at best and not at all in line with other treatment practices for income on post earnings, post-tax investment.
34 - Cindy
(In fact, it actually smacks of political lobbying for preferential treatment by the wealthy.)
35 - Cindy
On one hand commentors complain of government interference in "free market" via policy, and on the other argue that certain forms of income, e.g. inheritances and capital gains, should be treated differently than other forms of income such as W2s. - Robert duPrey
36 - Igor
@27,28 Chris and Clav: ALL money is multiply taxed! Get over it.
Every dollar paid by an employer has already been taxed against the people who previously handled it, whether investors or customers, for example.
Look anywhere in the economy and you can see where transactions are multiply taxed. It's an essential ingredient of our modern economy, which is dynamic, not static. All rentiers draw fees from transactions, from money moving in time.
IMO it's a confusion in the Calvinistic mind of westerners that only a virgin dollar can be taxed, just as only a virgin spouse can be wed.
But there are few virgin dollars, just as there are few virgin spousal prospects, and really, what difference does it make?
37 - Glenn Contrarian
Igor -
"Virgin dollars" - Nice turn of phrase! Useful, too....
38 - Igor
Economics seems to be hopelessly entangled in morality and religion. From the beginning cats like Adam Smith, David Ricardo, etc., have been employees of The Church and have devoted all their effort to proving that the Status Quo (church rule sanctioned by the powerful) was right and just and immutable.
Thus, we find that economic rules are not chosen for their efficacy in promoting the General Welfare, but rather to make sure they properly punish miscreants, i.e., the poor, and properly reward the virtuous, i.e., the rich, for surely we have proven that wealth and poverty are Gods judgements on the sinners and the virtuous, so it must be so.
39 - Les Slater
Capital, to the extent it has a free hand, determines not only economics but the whole system, including the political, that operates at its behest.