Wednesday, July 27, 2011

Junkbox, Episode XCV℉...  

So happy for all youse who got rain...(sigh)...


Ron Ellermeier said...

John, I'm the guy who lives on a sailing yacht. When I first made landfall on the little island of Bonaire, in the extreme southern Caribbean Sea, just about 55 miles north of Venezuela, what did I see on the gate of the salt works? Cargill. Bonaire is a Dutch Island. For centuries, the Dutch have been consummate merchants and traders. They brought black slaves to Bonaire in the early 18th century to work the salt flats and evaporation ponds for salt, a valuable commodity in Europe, especially for the salting of codfish and sardines. Obviously, in recent decades, Cargill bought the salt works, now about three centuries old. Today, sea water is pumped by windmills into the evaporation ponds. Large Caterpillar machinery is used to windrow the crystalline end product, and conveyors move it into ships at the salt terminal.

You can imagine my surprise to see a Cargill sign in such an exotic location.


someguy said...

Re: the 51% pay no tax....I think it's important to point out that the conversations about paying taxes are in relation to the financing and support of the federal government, not state and local governments, i.e., sales taxes & real estate taxes which do not support the federal government. The social security taxes they pay are in exchange for their own benefits....and it's well documented that on average the benefits are too high to be paid for by our contributions. So I believe it is accurate to say 51% are in no way supporting the expenditures of the federal government, beyond a partial payment toward their own social security benefit.

John Phipps said...


a. That's not what they say, but you are correct.
b. Here is why they don't pay (short of time and forgot how to hotlink)

Remember, all tax payers get the first ~$18,000 tax free, not just poor people.

Do you think we should lower the standard deduction, tax all SS benefits, or what?

Remember Coburn's attempts to end tax expenditures was call a tax increase by the TP.

Come to think of it, wouldn't changing the code so everybody paid some income taxes be a Forbidden Tax Increase?

someguy said...

The basic point is that the viability of our democracy is threatened when the majority of people have no incentive not to support continued expansion of federal spending in the hopes of capturing some of the benefits for themselves or seeing the benefits they already capture increase. This is the point of the statement you label a 'lie' and I think the point is a very valid one. The fact that it's easier to label it a lie than to deal with the obvious ramifications of this does not help the discussion.

In terms of what is to be done about it, I think we first need to recognize that the goal of our tax system should be to share the burdens of the cost of each unit of government among all, or almost all, of the voting members of society. This is an obvious necessity for any voter to make a reasonable decision about the role of each government unit in general,and the wisdom of specific government activities and programs.

I do believe that no more than the bottom 10% of income earners should escape the tax burden of any govt. unit. I also believe SS benefits should be taxed and means-tested. (long-run, I favor a privatized retirement system with 'social security' as more of a welfare system - naturally this should mean drastically reduced SS taxes).

We need to deal with these type of basic discussions and decisions about our tax system. Unfortunatey, too many want to simply point to the upper 5% who are paying 60% of the income tax and say "look at those rich people...they don't need all their money - they need to pay more"

John Phipps said...


There are two ways of looking at this elephant. You see half our population free-loading.

I see half our population making very low incomes. It's getting worse. You will see the number of tax "skaters" rise every time the standard deduction is raised. It will rise as median income stagnates; it will rise as income condenses in the top. (Right now they make as much money combined as the top 1%) And none of those things are what those folks want, I'll bet. Overwhelmingly they would love to be income tax payers.

The bottom decile is $12,500, BTW.

But my larger confusion is there is no reward in trying to squeeze taxes out of the bottom of our economy. There is no blood in that turnip.

Do you really think taxing Americans on every dollar after $12,500 will suddenly make them all better citizens? I can't see how that would work. It would simply make them poorer, and and add more weight in the safety net.

For better or worse, previous legislators decided it was easier to have to poor keep more income rather than pay taxes and give it back in benefits. I think that's more efficient as well. Perhaps we just have different ideas about how poor you have to be to get help.