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I disagree with you strongly, but I think you made a good attempt at an argument and I think it is wrong you were downvoted, so you have my meager upvote.

I think your argument is disproven by walmart. Walmart doesn't chase "the super rich" they actually chase the bottom end of the market. They make good money by doing their darndest to make prices as low as possible, both to increase volume (and marketshare) but also to cater to the market that doesn't have a lot of disposable income.

I don't see the problem here as a lack of "equality", in fact, the super rich are taxed more than the poor. If things were equal they'd all pay the same dollar amount (not even the same percentage, the same amount in absolute terms.) That would be more moral as well.

The reasons those with less money have trouble affording things is that they have been impoverished by government. Presume you're at the lower tax bracket and paying %15 to the IRS. You're paying another %15 to Social Security (though only half is reported on your check, you have to earn the other half as well or you wouldn't have your job.) You're paying- what %4 to medicare? %3 for unemployment insurance, say %5 in state income taxes (just picking a low number since some states don't have it and it varies.) That's %42 of your income right off the bat.

Now if you're just scraping by, that means you're spending all of the remaining %58! All of that is taxed at rates from %8 (city sales tax) to %30 (cable, phone, an flights) to as much as %40 (gasoline).

If we take the lowest figure there, %8, then that means of every $100 that person makes, government takes %50. It is worse fro people in the middle and lower middle incomes. Their state and federal income taxes are higher.

That's why people have trouble making ends meet.



> If things were equal they'd all pay the same dollar amout [...]. That would be more moral as well.

Why?

> The reasons those with less money have trouble affording things is that they have been impoverished by government.

This (and the argument that follows) is very wrong, for at least the following reasons.

1. The fraction of the money a person receives and spends that gets taken in tax is smaller, not larger, for poorer people.

2. In particular, there are personal exemptions and deductions, which make up a substantial fraction of the salary of people with low incomes, and the lowest tax rate is 10% and not 15%. Many of your other numbers are also wrong, and curiously all in the same direction. Social security taxes are not 15% unless you include the payroll taxes that fund Medicare, in which case the Medicare rate is 0%, not 4%. (It wouldn't be 4% anyway; payroll taxes are 2.9%, including the portion paid by the employer.) 8% of 58% is not 8%. Your percentages are, to put it bluntly, bullshit.

3. If you are going to include the employer's social security contribution in the figure being taxed, you lose the right to say that what's being taxed is so-and-so-many percent "of your income". Because, y'know, it isn't.

4. The money paid to the government in taxes doesn't simply disappear into a hole. It is used to provide services. For instance, that Medicare payment pays (astonishingly enough) for Medicare. Which, if you happen not to be rich, you are likely to have need of one day. In a hypothetical world in which Big Bad Government didn't take all that money, those services would need to be provided privately, and they would cost money. Probably about the same amount of money as the government spends on them. If our hypothetical low-income person is going to avoid being "impoverished" by the government, presumably that means they simply don't get the use of those services. Sorry, Mr Low-Income Person, I know your house was burgled, but you haven't paid the private police and judicial services: no law enforcement for you! Oh, and your child was injured by a toy whose makers were recklessly indifferent to safety? Well, you should have paid for a safety audit yourself. Oh, you lost your job and are starving to death? You'd better find a private charitable organization that wants to help you, then: keeping you alive is no job for the state.

5. (This is more or less #1 from a different perspective.) The difference between poor and rich people, which explains why the poor people can't afford to make ends meet, is not that the government is taking the poor people's money and not the rich people's. The government is taking everyone's money (and doing useful things with it, see #4, but that's a separate issue). Imagine for a moment a world in which the money taken in taxes really does just get burned in a big incinerator. What happens? Answer: there's a large deflation rate, so presumably the currency needs re-denominating every now and then. Aside from that -- which would, yes, have bad effects because of the rapid change, but that's not relevant here -- everyone would in fact be about equally well off. Every year you'd lose half your money, and so would everyone else, so all the prices would have to halve to keep supply and demand in balance, so that half-your-money would be worth the same as it was before it was halved. Of course that's an oversimplification because in our hypothetical world income is being taxed but investment isn't. So the deflation rate would be a bit lower and the net effect would be a steady transfer from those with less capital to those with more. But in the real world, gains from investments are taxed just like gains from income are. If taxation is impoverishing the poor, the reason is the difference between the tax rate on income and the tax rate on capital gains, and you should be arguing for equalizing those, not for reducing taxes as such.




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