Income inequality "solutions"

[BawanaRik]

Quite frankly, the solution is that their is "No Solution". In all the thousands of years of human civilization there have been both rich and poor people. This will never change. The best thing one can do is educate yourself and your children so you have a valuable skill to sell to society and then prosper as much as possible utilizing those skills. I can't put it anymore simple than that. Just sayin.

I believe you've solved the problem. Let hit the danish!

 

[Unrepresented]

Hmmmm, I might have to look into the Martian party.

 

[two fingers]

What I'm getting at is that your statement below from the first post regarding the money being taken from the wealthy not being re-distributed is a falsehood.
The EITC is a direct contradiction to that statement. The money involved IS redistributed, and it goes to "those at the other end of the income scale" and NOT "government".

1)
Decreased statutory corporate tax rates while removing great majority of loopholes/credits/subsidies.

Also apportion taxable income by sales - prevent offshoring of profits to avoid paying taxes on "stateless income".

2)
Mostly keep current tax brackets, but increase standard deduction to poverty line. Index tax brackets to inflation. Add one additional tax bracket at top with 45% rate.

3)
Change from 2 types of Capital Gains (short & long term) to three (short, medium, long term).

Under the current system -
Short = less than one year, taxed as regular income.
Long = more than one year, taxed at 15%.

Under my system -
Short = less than 1 month, taxed as regular income with +10%

Medium = 1 month to 2 years, taxed as regular income.

Long = 2 years or more, taxed as regular income with schedule shifted -10%

4)
Allow anyone who wants to join Medicare/Medicaid

5)
Remove earnings cap on SS/FICA making it a flat tax instead of regressive

6)
Means test SS/Medicare with benefits beginning to taper above 4x median income.

7)
Free university education for all high school graduates desiring it and qualifying for a given university.

...just a start.

And the money for this (especially #7 and #4) comes from?

 

[BawanaRik]

I tried making this point earlier, but apparently I don't understand my own talking points.

Not to worry. That's why we're here at TB.

 

[Jared Lash]

And the money for this (especially #7 and #4) comes from?

Revenue generated by #1, #2 and #3?

 

[DerHoggz]

Just off the cuff from reading the OP, will read the rest of the thread when I get time.

The current tax system is fairly regressive, and those who make less need a higher percentage to take home because necessities take up a higher percentage of their income. Maintaining the same overall tax, but shifting the burden to those that can easily afford to pay more would help.

Just because something is "bad for business" does not make it bad for society. Child labor was "good for business."

There is a problem with the aspirational consumer culture. My idea is that if some job isn't worth paying someone a full-time living wage then that job must not be important.

Unions.

A social safety net is a very good thing. The argument that people should move to find a better job fails because of the lack of a strong net. If you take the risk and fail for whatever reason, you are done. Invalid Link Removed explains a bit about that; he wound up homeless through no fault of his own and it is just ridiculously hard to get out of.

Interesting side-note, strong social services stop pick-up artists: Invalid Link Removed

 

[BawanaRik]

The Danes are alright man. Let's hit the English. .

Danish is the pastry served after, during etc any of those boring endless corporate meetings.

 

[aborgman]

When someone puts 15% of their earnings year in and year out for 50 years the resultant payout is hardly an entitlement.

It is simply due them. And much more.

Anything you're entitled to is an entitlement.

It's an entitlement specifically because they are entitled to it because they put 15% of their earnings year in and year out for 50 years.

 

[DerHoggz]

Entitlement is not limited to the lower-class. The average household is in massive debt.
Invalid Link Removed

 

[BawanaRik]

And the money for this (especially #7 and #4) comes from?

You and I and others who worked a bit harder saved more and invested not only time talent and effort but money into the system.

 

[spade2you]

Ok, we've discussed entitlement.

Someone mentioned nepotism. I find it interesting that it's considered such a bad thing. Obviously it's a bad thing when it works against you. However, if you're in a position where you can put your children into extremely good economic conditions, isn't this a good thing? Sure, we can get off on corporate greed stories. I certainly don't want to put my children into worse financial situations.

Massive inheretence seems to be a bad thing. I'd probably call it success.

 

[aborgman]

It's my opinion this isn't true.

It's my opinion that it is highly dependent on when (relative to the start of SS) one started paying in and when one started receiving benefits.

Folks who retired in 1940? On average took out WAY more than they put in.

From a 2012 Urban Institute study -

According to the institute’s data, a two-earner couple receiving an average wage — $44,600 per spouse in 2012 dollars — and turning 65 in 2010 would have paid $722,000 into Social Security and Medicare and can be expected to take out $966,000 in benefits. So, this couple will be paid about one-third more in benefits than they paid in taxes.

If a similar couple had retired in 1980, they would have gotten back almost three times what they put in. And if they had retired in 1960, they would have gotten back more than eight times what they paid in. The bigger discrepancies common decades ago can be traced in part to the fact that some of these individuals’ working lives came before Social Security taxes were collected beginning in 1937.

Some types of families did much better than average. A couple with only one spouse working (and receiving the same average wage) would have paid in $361,000 if they turned 65 in 2010, but can expect to get back $854,000 — more than double what they paid in. In 1980, this same 65-year-old couple would have received five times more than what they paid in, while in 1960, such a couple would have ended up with 14 times what they put in.

...and

 

[aborgman]

And the money for this (especially #7 and #4) comes from?

It comes from the following -

1)
Decreased statutory corporate tax rates while removing great majority of loopholes/credits/subsidies.

Also apportion taxable income by sales - prevent offshoring of profits to avoid paying taxes on "stateless income".

2)
Mostly keep current tax brackets, but increase standard deduction to poverty line. Index tax brackets to inflation. Add one additional tax bracket at top with 45% rate.

3)
Change from 2 types of Capital Gains (short & long term) to three (short, medium, long term). Note - this would involve an increase in tax rates for those who make the highest capital gains profits and those who introduce useless volatility (day traders) to the market.

5)
Remove earnings cap on SS/FICA making it a flat tax instead of regressive - currently income above $114K pays ZERO toward FICA/SS.

6)
Means test SS/Medicare with benefits beginning to taper above 4x median income.

 

[Unrepresented]

Ok, we've discussed entitlement.

Someone mentioned nepotism. I find it interesting that it's considered such a bad thing. Obviously it's a bad thing when it works against you. However, if you're in a position where you can put your children into extremely good economic conditions, isn't this a good thing? Sure, we can get off on corporate greed stories. I certainly don't want to put my children into worse financial situations.

Massive inheretence seems to be a bad thing. I'd probably call it success.

Monarchies would approve of your assessment. After all, "It's good to be the king."

 

[aborgman]

So the people who get money they haven't earned are not getting entitlements? It's just plain and simple an hand out?

If they are entitled to it - whether through ownership, earning rights, or just plain contract law - it's an entitlement.

 

[BawanaRik]

It's my opinion that it is highly dependent on when (relative to the start of SS) one started paying in and when one started receiving benefits.

Folks who retired in 1940? On average took out WAY more than they put in.

From a 2012 Urban Institute study -



...and

1940 was a long time ago. From what I've read none of these "studies" take the time value of the money into consideration.

The market was at or about 100 when I started paying SS. It's now at a higher level. I want that level of return.

 

[spade2you]

Monarchies would approve of your assessment. After all, "It's good to be the king."

 

[aborgman]

Someone mentioned nepotism. I find it interesting that it's considered such a bad thing. Obviously it's a bad thing when it works against you. However, if you're in a position where you can put your children into extremely good economic conditions, isn't this a good thing?

A "good thing" for who?

Your child? Your family? Your community? Your state? Your country? The world?

 

[DerHoggz]

Ok, we've discussed entitlement.

Someone mentioned nepotism. I find it interesting that it's considered such a bad thing. Obviously it's a bad thing when it works against you. However, if you're in a position where you can put your children into extremely good economic conditions, isn't this a good thing? Sure, we can get off on corporate greed stories. I certainly don't want to put my children into worse financial situations.

Massive inheretence seems to be a bad thing. I'd probably call it success.

Shouldn't they have to pull up their own bootstraps?

But really, straight nepotism doesn't help anyone. (except the child monetarily in the short run)

 

[aborgman]

1940 was a long time ago. From what I've read none of these "studies" take the time value of the money into consideration.

Irrelevant.


The claim was: people are getting less out than they put in.

Now you're trying to move the goal post to: the return is less than market rate.

Those are two completely different things

The market was at or about 100 when I started paying SS. It's now at a higher level. I want that level of return.

Social Security is not, and never was intended to be, an investment program.

You'd think folks would notice it's called Social Security Insurance... and like all insurance, it exists to protect in case of catastrophe, not to generate profits for its constituents.