Why should people making $15,000 and less

[dsc]

be paying for tax cuts for people making $40,000 and more? We keep hearing about these middle class tax cuts but never mentioned is just where the money comes from that is paying for them. It is coming, to no small extent, from Social Security funds. For the record, I currently don't participate in Social Security except through my summer employment so any statements about Social Security are unlikely to apply to me. Another tidy sum is coming from Medicare funds. I do pay into that so that does apply to me.

While, it is true that any family income up to around $81,000 is fully subject to Social Security tax and that $81,000 is a per earner limit. It is equally true that lower income people both get a better deal from Social Security and are vastly more likely to be depending on it for most of or all of their retirement. Thus, they have a much greater stake in the future health of the Social Security system than does a solidly middle class family. Thus we are robbing their money.

When Clinton came to office he had promised a middle class tax cut but had to back off when the true deficit situation was shown to him. Had he not done so, Social Security would likely already have been either privatized or would be heading toward bankrupcy now. Instead Bush inherited a unified surplus, a non social security surpluss, and an opportunity to actually fix Social Security which Reagan and his dad had messed up. Instead he took the money and gave it away.

Now the next President will be in Clinton's situation. The difference is that we know that now. The most vulnerable amoung us are the ones who will be destroyed if Social Security goes down. Instead of the close to 30 years we had originally to fix this we are closing in on 10. We simply can't afford to give tax breaks to people who are doing reasonably well by stealing from those who aren't. Families in that bracket are already getting a break on income taxes relative to singles who make far less. Everyone is going to have to give some here. The rich should be giving far more but everyone will have to give some. It is only fair.

As it now stands I pay more in actual dollars in income taxes than families, of 4, making making close to 3 times as much money as I do. If I were depending on Social Security I would be having my pension robbed on top of that. That isn't fair. It isn't good policy either.

[Cleita]

1. Social Security should be uncapped.

Meaning that it shouldn't stop at $81,000. People who earn more than that certainly don't need the break. I would be more inclined to not tax the first $10,000 earned and have anything over that taxed for SS. Another problem with SS is that it is based on what you earned at a certain time in your working history, so the poor shlogg who earned little more than minimum wage all his life will get less than Joe Millionaire. It seems this shouldn't be either.

For instance, I collect my own SS, not my benefit through my husband. My SS is half of his, not that I worked any less, it was just that as a woman I earned less even though I have a higher level of education than he does. I didn't benefit from the feminist revolution that those fifteen years younger than me did, even though it was my generation that fought for this wage equality.

So, if I wasn't married I would be very poor indeed and yet the millionaire who doesn't need social security will get more. I worked for a man, who worked into his eighties, but he collected what SS he could. He didn't need it of course, so he gave it to his grandson every month to spend as he liked, yet at that time there were poor women who had to eat at the local homeless shelter because their checks barely covered their rent and living expenses and that didn't include food. I would like to see benefits distributed more evenly downwards rather than upwards.

Social Security cannot be done away with because then we will go back to an era of old people dying of starvation and neglect for no fault of their own.

[dsc]

7. I have no problem removing the cap

and using that to both shore up Social Security and to butress pensions at the bottom of the rung. But means testing would be a serious error. One reason Social Security has endured is its universal nature.

[Cleita]

9. It's already means tested.

The rich guy gets the most money. The poor person gets less because he was not able to contribute as much as the rich guy. I think everyone should get the same amount. $1,000 to me would make a big difference in my purchasing power. To a rich guy, it's probably money to tip his limo driver. I'm not saying he shouldn't get his benefit, but a poor person's benefit should be the same.

[Yupster]

15. But the formula is very progressive

The guy who puts twice the payments into the system doesn't get nearly twice the benefit. The social security system benefits formula is very progressive as it is.

[pasadenaboy]

72. Amen

people under 40 are already paying for a benefit we will never see, so we might us well fund it as far into the future as we can by taxing it all the way up.

[stevebreeze]

2. it is far worse then you suggest

funds are now taxed at 15%. There is no SS and no Medicare on any capital gains. In the state of Washington there is no income tax. Bill Gates effective tax rate is 15%. Most people with income under 6 figures pay 15.3% FICA on every single dollar then earn. Then on top of that pay state and federal income taxes. It is not just that this is unfair it is piss poor economics.
We need coomon sense econoimcs and more progressive taxation and we need it yesterday.
:kick:

[SharonAnn]

43. Only "earned" income is taxed for Soc. Sec and Medicare

"Unearned" income is not. Unearned income is things like dividends, inheritance, capital gains, you get the idea. The kind of income that better-off people have. And for those who are really well-off, that's the only kind of income they have.

[gmoney]

3. Remove the cap on social security earnings...

... make it a straight 6% (or whatever works) on all declared income, whether it's wages, stock options, perks, capital gains, inheritance, gambling income, gifts, whatever, with NO top end. Bill Gates earns a billion in a year? He pays $60 Million into the Social Security pool.

Social security should also have an income limit for collecting, too. Even if you're retired, if you still have over $75,000 in annual income, you don't get to collect social security. After all, it's for SECURITY... that way, maybe we can afford to pay the people that really NEED the money enough to bring their income up to a reasonable amount... say $35,000 a year, adjusted for inflation.

The right wingers will say this removes all incentive to save for one's own retirement. Fine! If you feel you can live on $35,000 a year, feel free to blow all your money on candy and gum and Def Leppard T-shirts. You're still paying in to the fund, and the money you blow at least goes into the economy. Or if you pass your millions along to your kids just so you can collect your $35K, they'll pay into the fund on that money, and then go pump it into the economy one way or another.

This will protect the retirees who worked hard all their lives, or who were homemakers, but never earned enough to set a serious amount aside.

Maybe it's just a socialist fantasy, but the ivory back scratcher crowd got all the breaks in life, built their fortunes on the backs of wage slaves and taxpayers, so they owe SOCIETY at large a little SECURITY in return.

"They want the federal goverment controlling Social Security like it's some kind of federal program." -- GWB 11-2-2000

[AP]

4. Clinton may not have given the middle class as big a tax break as he...

...promissed, but he did try as hard as he could to progressivize whatever taxes he did collect.

You all have to ask yourself if your candidate is clearly down with that proect.

[dsc]

5. He gave them no tax cut at all

He actually raised those of middle class divers slightly via the gas tax. He didn't give a smaller tax cut than promised but gave none at all.

[AP]

33. Where do you get those numbers?

If he lowered rates on middle class, gave them a better ecnomy, and then they went out and bought SUVs which made them consume more gas, which incurred a gas tax, I'm not sure you can say that Clinton took more money from them with a straight face.

He did what progressive taxes were supposed to do: lower tax burden on middle class, which stokes the economy. Because Republicans fought him on CAFE standards, and Detroit refused to make fuel efficient cars is not argument that progressivity is bad or doesn't work. In fact, it's almost the opposite and shows how Dems need to be vigilant on EVERY front, and not just taxes.

[dsc]

53. He didn't lower any tax rates other than increasing the EIC

He also raised the gas tax 5 cents a gallon. Both are facts and matters of public record. I have to say, now I am beginning to understand why you have so much difficulty understanding Dean's tax plan and relating it to other ones.

Here is a link

http://www.youdebate.com/DEBATES/clintons_tax_increase.HTM

Line 31- The promised Earned Income Tax Credit. The threshold for the working poor was increased from $22,700 to $23,050. It helps working poor with children stay off welfare.

Line 34- Increased standard deductions. An additional $100 per person is deducted from taxable income.

Line 36- Increased exemptions. An additional $50 per person is deducted from taxable income, and the threshold for exemption limitations was raised from $78,950 to $81,350 which helps reduce taxes from the upper-middle class

This a list of all the taxes they cut. None of these are rate cuts and most are mickey mouse ones. Only the EIC, which is for the working poor, was increased (thus cutting taxes) significantly. He just didn't cut middle class tax rates. he just didn't.

[AP]

75. What were the tax rates and brackets before Clinton's big tax bill?

I'd be surprised if he didn't make the rates and brackets more progressive.

Furthermore, asking for 5c more per gallon for gas doesn't neccessarily raise prices. Retailers still have to price at a level that responds to supply and demand and gives them reasonable profit margins. If their profit margins were outrageous and consumers are price sensitive, they'd just take it out of profits.

Also, remember in 99, was it, when gas was 1 buck per gallon? That was the price going down dispite the 5 c tax. And clearly gas prices moved all over the place. Just because the middle class were paying some of that tax, it's not clear that they wouldn't have been paying lower prices but for the tax. Note that there are very few itmes which are priced as elastically as gas. Haven't we had this discussion before?

As for me having a problem understanding Dean's tax policies, you'd have to have a lobotomy before you'd think that Dean's tax plan wasn't outrageously out of step with the way real Democrats feel about tax policy.

[dsc]

76. He raised the top bracket

that is it. I never said he didn't make the tax code more progressive (that alone did) but I did say, and stand behind the fact, that he didn't cut middle class taxes. He just didn't. I followed the bill. A Congressman I helped elect lost his seat over that vote. I know what it did and what it didn't do. It didn't cut middle class taxes.

[AP]

77. By making the code more progressive, and making people

wealthier, he might have reduced the percentage of income the middle class paid in taxes, which is the point of it. So what if in 92 and 98 a middle class person is paying the same or 10% more in taxes if they're 20% wealthier and the money they have is worth more.

That's why you make the code progressive -- you want to equalize the burden. And if the code is very regressive, that usually means you pay a lower rate if you're poor and middle class, and you pay a higher rate if you're rich.

I'd really like to see the pre-Clinton rates and brackets and compare that to what Clinton passed. I know Clinton created two new higher brackets. I also suspected he moved the cusps farther out, which, if he did, means that he did lower taxes on people who dropped down to a lower bracket.

So, what were those brackets and rates?

[NavajoRug]

50. Clinton's intentions may have been good, but the results . . .

. . . were actually pretty much the reverse.

In fact, the 1993 budget bill was disgraceful in one key respect -- it raised the rate on capital gains (nothing wrong in and of itself) to match a taxpayer's income tax rate, DESPITE KNOWING FULL WELL THAT FEDERAL REVENUES FROM CAPITAL GAINS TAXES WOULD DECLINE.

Two years later -- after the 1994 election disaster -- Clinton signed the GOP bill that reduced the capital gains tax rates to 20% and 10%, depending on the person's income tax bracket.

As a result of these manipulations of the tax code, we ended up in 1995 with a tax system that was actually more regressive than it was in 1993 -- because the cuts in the capital gains tax benefitted high-income earners ALMOST EXCLUSIVELY.

[Yupster]

6. Two solutions

1. Remove the cap on income subject to social security withholding.

2. Require workers who are not in social security (mostly schoolteachers and state workers) to rejoin the system.

Those two things will greatly relieve the pressure the system faces. Also politically, number one will be a burden on Republicans and number two a burden on Democrats. If they're done together, they could be a compromise solution as both sides will have to ask one of their special interest groups to give some.

[dsc]

8. The problem with number two

is that one of the reasons people go into teaching is that they know at least their retirement will be good. We already get hit on the salary given our education level. To return to inferior pensions would make recruiting teachers very difficult.

[buycitgo]

11. and how bout what's happening to health care?

deductibles going WAY up

drug copay quadRUPLED this year for our plan, along with very restrictive coverages.....lots of drugs not even paid for now, based on bean-counters' determination of "medical effectiveness"

not to mention drastically reduced ability to choose own docs, with resultant lowering of percent coverage.......from 80% to 60%, if you don't go to one of our district's approved list of docs, which has drastically declined due to our large district's decision to go self-insured. really eats it.

[dsc]

12. Very true

my dad is a retired teacher and his health care not only is hugely expensive but not terribly good. If it weren't for a special program to insure my mom he would be broke. As it is he is spending money hand over fist.

[Yupster]

14. And the thinking is that

expensive healthcare is somehow a special problem for teachers? It's a problem for everyone. It hits the self-employed and those not working the worst of course. Teachers have group coverage through their districts, and group coverage through their retirement plans once they're retired. That's way more than many other people have.

[dsc]

20. not all teachers do actually

In some southern states it is either not provided or is a very recent fringe benefit. In MS they didn't have insurance until around 1993 to site one example.

[Yupster]

24. What state teacher retirement plan

doesn't have a medical benefit that goes with it? If there is one, I've not heard of it and I work with teacher retirement plans for a living.

[revcarol]

30. In many states, you have to teach a certain number of years

to get it, and then it is an HMO that costs an arm and a leg.So if you stayed out a number of years to raise your children or take care of your invalid mother, you're out of luck. Or if you are an aide, a janitor, a secretary, fergit it. It's only fer teachers.

There are so many restrictions and hoops to jump through and general bureaucratic mess(don't tell me they didn't design it this way to eliminate people or get their benefits reduced because they didn't meet some obscure "criteria!!)Social Security and Medicare UNPRIVATIZED are the only programs for EVERYONE!!

[dsc]

35. My dad

would have to pay several hundred dollars a month just to insure himself and his wife. He alone will be over $200 a month. Things have changed big time.

[Yupster]

13. If social security is such an "inferior pension", then

why are we defending it so heavily for everyone else?

It's supposed to be a retirement burden that we all share. To me it is not acceptable that we all share the burden except schoolteachers. If a kid's dad dies, I am happy we all chip in and give the kid a check from social security -- all chip in except teachers that is. They've got themselves their own little cherry system which doesn't have to contribute to kids whose parents die, or who are disabled, or retirement for spouses who never or barely ever worked, or very low income people who worked little. We all share the burden for these people, and most of us do it happily -- all except schoolteachers who've carved themselves out a much better system and don't want to give it up.

If you were in social security, you'd have the same retirement as miners and plumbers and nursing home workers and daycare workers. Except you'd still have your 403(b) that these other groups wouldn't be entitled to, and you might depending on the district have a 401(a) too which the other workers couldn't have either.

I don't understand why teachers feel they deserve a better system than say nursing home employees? And I was a teacher for nine years.

[buycitgo]

16. why are we defending it for everyone else?

jesus......

how bout for the simple fact that there are MILLIONS of people who DON't have any retirement plan at all, for whatever reason, and if the kleptos get their way, the SAME thing will happen to a (what's their Orwell replacement word for "privatized?") revamped SS system that happened to the Savings and Loans, is happening in the Mutual Funds AND the Stock Market, AND in DOD procurement (a fricking TRILLION dollars "missing").

you may have a small point on teachers' retirement systems--they're statewide, not national--(seniority not portable between districts), BTW, and MANY suck.

you also conveniently forget that civil service gets a MUCH better med/retire plan than teachers.....what about them? brings up those nasty nasty union "interest groups," who I'd guess you don't like too much, either.....rather depend on the benevolence of theose people oriented groups like stockbrokers, Bankers, CEOs, HMOs, etc., right?

give me a break

Midland, Tx? FOB?

[Yupster]

21. I don't begrudge anyone a better plan

if it's in additional to the plan we all share.

If Civil service people contribute to medicare and then have a better plan too, that's wonderful because by contributing to medicare, they're sharing the burden with the rest of us for those who can't afford to pay anything or little.

In the same way, if teachers were in social security and also have a 401 (a) plan, I think that's great. In social security they share the burden with the rest of us, and then they have something else. Great.

My complaint is one group carving itself out as some kind of priviledged group of workers and seeming to think they don't have to share the burden of the national retirement plan with all the rest of us. Teachers being out increases the burden on the rest of us of course.

Those millions of people who depend on social security would have a better chance of getting some if teachers would contribute to the pot.

It's real easy to stand aside and say "gee I wish someone would help those people. Not me of course. You see I have my own special plan. You see, I'm a teacher."

[dsc]

17. because teachers make a deal

As a group we are only slightly above the median income depite being educated to an advanced degree level. The tradeoff is we get a very good retirement system (BTW I pay a higher percentage tax for it than I would for SS 10% vs 7.5% and I pay Medicare). I don't think that is unreasonable. Pay us what we are worth (by education) and then we can give up our retirement.

[Yupster]

18. Are there other professions

who should get a special deal? or should it be just teachers?

In Texas teachers pay the exact amount into TR as they would pay into social security. Which state charges you a 10 % pension premium?

[dsc]

19. Ohio

and they have for several years now.

[dsc]

22. I know of no other

such highly educated profession that makes as little as teachers do. Maybe some other public employees would come close and they have better pensions than we do.

[Yupster]

25. So you really do think that teachers deserve

some kind of special carveout retirement program and shouldn't have to participate with us lowlies because of your extraordinary education?

I was a teacher a long time and was never that impressed. I was embarrassed that education majors have the lowest SAT scores of any college majors.

My master's degree is in Curriculum and Instruction. I got it with a classroom full of other schoolteachers. We all got it for the same reason. We wanted the stipend we got for having a master's. A master's in curriculum and instruction is not exactly the same as getting a master's in civil engineering or chemistry. I certainly don't use it to brag about my intellect.

[dsc]

38. It has nothing to do with intellect

but cost. It takes time and money to get a Masters no matter what it may be in. That is a cost. Teachers are way lower paid that other similarly educated, and thus people who have paid a similar price. One of the things we get in return is a good pension. That seems eminantly fair. And again, I pay for it.

[Yupster]

62. Yeah

I took two classes each summer. I don't know where I found the time.

[alcuno]

45. I'm in Illinois and pay 9% to the IL Teacher Ret System ($7116)

this year. In addition to also paying Medicare, I'm paying somehing called THIS (Teacher Health Insurance Security) for health insurance for retired teachers (I think that's what it is for.) It's around $600/year.

[kaybea]

29. Please help with a question I have...

Yupster or dsc. Some states don't require schoolteachers to pay Social Security taxes? Really?

Both my husband and I are teachers in the public school system of Pennsylvania. We have Social Security taxes deducted from every paycheck we've ever earned. And that's in addition to the required contributions of 7.5% to our state retirement fund, PSERS.

[dsc]

36. If your state retirement system existed before

Social Security did then you were grandfathered out. I do pay FICA taxes via Medicare though. I would have thought PA was grandfathered as well so am surprised on that one. But that is where it comes from.

[kaybea]

73. Thanks for the reply.

Yes, the PA retirement system is older than Social Security. It was started in 1917.
I did a little research.
Here's a list of states whose public school employees don't participate in Social Security:

http://www.nea.org/socialsecurity/nonssstates.html

[Yupster]

57. In Texas

the overwhelming number of schoolteachers do not pay into social security. There are a handful of districts that do, but it is way less than 5 % of teachers. Texas teachers pay in the exact same amount to TRS as other workers pay into social security.

If a plumber worked 40 years and gradually increased his pay from 10,000 o 40,000 a year, he'd retire and get about $ 1,300 per month from social security.

If a teacher worked the same 40 years and gradually worked his salary from 10,000 to 40,000, he'd retire and get ... where's my TRS formula...

experience times 2.3 equaly percent pay.

40 X 2.3 = 92% of 40,000 or (drumroll please)

$ 3,067 per month.

Now how can a teacher put in the same amount as a plumber and get 2.5 times the pension?

It's because the plumber is helping so many people with his contribution each month. The plumber is paying for the kid who's dad dies before he turns 18. The plumber is helping with the disabled person who gets a ssi disability check each month. The plumber is helping fund a dignified retirement for the person who worked very low paid jobs, or the spouse who hardly worked at all. All these people get supplemented from the plumber's retirement contributions.

The teacher is glad the plumber is helping these other people because like a good Republican, the teacher takes care of himself, makes sure he gets double what everyone else gets, and hopes those less educated than he somehow will be okay.

[buycitgo]

10. excellent thread.......excellent, point-on responses

definitely uncap that silly 81K limit. I got screwed BIG time in the 80s, when SE rates went up about FIFTY PERCENT in a matter of just a few years, to sneakily pay for the gigantic shortfall RR's huge income taxes caused. David Stockman (the effective architect of this boondoggle) couldn't stomach the huge shell game being perpetrated, so, unlike just about all the other kleptocrats since, he walked.

interestingly, some dork from Wall St. Journal sort of addressed the point of WJC's inability to tax effectively, said that it sux being a dem, cause they have to come in after the pug prez went CRAZY spending, and try to undo the damage. He couldn't resist lying a bit, though, implying that #41 lowered the deficit somewhat after taking over for Reagan (he did, of course, raise taxes)....didn't, of course, mention that WJC was left (as above poster mentioned) that Bush lied his ass off---could've been prosecuted for what he did, according to some---stunning the new pres with how bad things really were when he took over.

Viet Nam/Nixon/Ford's crazy economic policies, along with sabotage by his own party were what basically killed Carter, and would've done in Clinton, had it not been for the insane pranks of Gingrich's boys+stock market bubble+tax hike/lower national debt/lower interest rates/lower effective tax rate, etc., resulting in good times for many at top/middle of economic ladder. point being that dems, since Nixon have been the Quackser Fortunes for the rabid RW radical kleptocrats, shoveling up their economic turdcastles, and trying to dig us out from the deep deep squat the thieves have buried us under.

and woe to ABB who might be lucky/unlucky enough to inherit this nightmare.......hard to imagine him being anything but a one-termer, given the absolute ruin wrought on EVERY single politico-economic front by the junta running things now.

and if * manages to steal the election again, well, I'm in the process of renewing my passport

[sandnsea]

23. Earned Income Credit

People 25 and over get this credit which helps the lowest income workers. But it's still true, working people subsidize income tax cuts with SS taxes. And something else that bugs me, Medicare taxes. Why don't they remind working people, especially the young, that they are paying for that shitty Medicare Grandma has. I think if people would wake up and remember Medicare is coming out of every single paycheck, they'd realize they have an absolute voice in what kind of health care seniors get. It's not a senior issue when I'm paying for it goddammit!! (That last thing was just for emphasis)

[Yupster]

26. no cap on medicare premiums though

I agree the cap should be taken off social security too.

[dsc]

37. actually only people with children

get the EIC. Unless they are literally destitute.

[sandnsea]

39. 25 to 65

And very low income, but not working homeless necessarily. I guess maybe it would depend on where the person lived whether they would be destitute.

[dsc]

41. When I did my taxes

I would have gotten a minisule amount back in EIC. I didn't want audited so I didn't take it. For a single, childless, person to get the EIC in any significant amount he or she would have to be making something like 12,000 a year. Even then it is still a pretty small amount of money in comparision to the SS tax.

[eridani]

27. Kucinich has the answer, as ususal

http://www.kucinich.us/issues/tax_cuts.php

In response, Kucinich has introduced bill that creates
a more fair, simple, and adequate tax system. The Progressive Tax Act of 2003 gives $87 billion per year to people with modest income and families in the middle class. The bill collects an additional $107 billion per year from the Bush tax cuts, corporate tax loopholes, and other tax giveaways. The bill therefore raises a sum total of $20 billion per year that remains available for deficit reduction or new spending.

First, the bill provides a refundable $1530 Payroll Tax Credit for people who work. This tax credit is simple, targeted to relieve a high tax burden, provides a stimulus effect, and encourages work.

Second, the bill provides a refundable $2000 Simplified Family Credit. This simplifies the tax code by consolidating the EITC, Child Tax Credit, Additional Child Credit, and exemption for children into one Simplified Family Credit. This tax credit will provide greater transparency, provide extra work incentives, and a stimulus effect.

To raise federal revenue the bill will close corporate loopholes and set tougher penalties to prevent corporate tax shelter abuse. In addition, the bill will roll back most of the Bush tax cuts in the past three years that benefited the wealthy.

[GreenPartyVoter]

34. Yep. he has great plans

Too bad the media never talks about them in depth.

[KayLaw]

28. In Florida

Teachers pay full SS and Medicare tax, and the school boards pay an additional percentage to their retirement fund. Our salaries are very low.

[PSR40004]

31. The poorer you are the better SSI is for you...

Thats a fact...

[coda]

32. Yep, like the WSJ wrote, they're just a big ol' brace of "lucky duckies" .

:eyes:

[sandnsea]

40. Yes, a $450 retirement check is lucky lucky lucky n/t

[BiggJawn]

42. You're RIGHT!

Because if you're poor, you didn't "sock it away" in mutual funds and investments, because after putting "food on your family", there wasn't anything LEFT to sock away.

And you don't have a retirement pension to rely on, because everyplace you've ever worked didn't even offer paid vacation, much less a pension.

Sure, SSI is a good deal if you're poor. Without it, you'd have nothing.
Sounds like "Lucky Duckies" to me!

[Yupster]

58. Unless if you die before age 62

then you were way screwed.

[Aconymous]

44. Why

don't we just have a flat tax rate, then those who earn more pay more, and those who earn less pay less. When the US became a nation and went to **GASP** WAR to become an independant nation, the tax rate was only 3%. Why aren't we upset at those who want 26% to even 57%? After all, that was the tax-rate of the former "evil empire", the Soviet Union.

Speaking of tax rates, if it were truly fair, then the top 7% tax bracket wouldn't already be paying for 52% of the taxes taken in by the federal government. I don't personally use many loopholes, but I believe in them. If they weren't there, I would be paying 26% federal tax in stead of the 15 that I do. I earn between $25,000 and $39,000 a year. Hardly rich.

[alcuno]

46. That's what a progressive tax system does.

Those who earn more pay more. The 15% flat tax is a horrible idea. Someone earning $15,000/year would pay $2,250 in taxes; leaving them with $12,750/year to pay "other" taxes as well as to live on. Someone earning $150,000/year would pay $22,500 in taxes; leaving them with $127,500/year to pay "other" taxes as well as to live on.

Face facts. The $15,000/year earner is virtually destitute and unable to afford housing, food, and clothing. Forget about medical insurance. Those who earn more should pay a higher percentage because their basic needs have already been met. A nation cannot function that leaves so many of its citizens trailing in the dust of a few. I do not understand those who feel sympathy for the top 1% (those making over $300,000/year) while scoffing at the plight of those who struggle daily to meet basic needs.

The $150,000/year earner is benefiting the greatest from this country and should bear more responsibility for its well being. There is this notion that the $150,000/year earner is doing it all on his/her own and that is preposterous. I challenge those who think that way to pack up their belongings and head to Rwanda, Afghanistan, or Albania. We'll see how long they last doing it "on their own."

[Muddleoftheroad]

47. A flat tax can work, but it needs a high floor

If everyone pays no taxes on the first $30,000 or so. then what you end up with is a progressive tax that is equally fair to all.

[alcuno]

48. Is that $30,000 for one person or a family of five?

A flat tax can work, but for who? I know some very wealthy people who find it laughable that some poor dupe earning $25,000/year is concerned about their "unfair" level of taxation. They wouldn't trade places in a million years for the "opportunity" to pay a lower dollar amount in taxes.

[Muddleoftheroad]

51. Per adult earner

A flat tax can work for everyone.

Face it, the tax bureaucracy not only destroys faith in the law and works to the betterment of the tax attorneys and CPAs, but it is inherently unfar.

[alcuno]

55. So the person supporting 1 pays the same tax as the person

supporting 5? What is destroying faith in this country are laws and a tax system designed to provide the greatest benefits to those already sitting "in the catbird seat." Again, the country is turned upside down when the concern is for the haves and not for the have nots. I'm certain that the management of major firms find commisseration with their personal taxation situation heart-warming as well as infinitely amusing.

[NavajoRug]

60. Not necessarily . . .

Even with a flat tax system you can still have a standard deduction (see my post below) and tax exemptions per child.

[NavajoRug]

52. I don't think this is how the flat tax is supposed to work . . .

Even with a flat tax in place, I believe there would still be personal exemptions and child deductions in place.

Let's say the personal exemption is $5,000 per year. The person who earns $15,000 would not get taxed on the full $15,000, but on the $15,000 minus his personal exemption. This means he would pay 15% of $10,000, or $1,500. His effective tax rate, therefore, is 10%.

The person who earns $150,000 would get the same $5,000 exemption, so he would pay 15% of $145,000, or $21,750. His effective tax rate is about 14.5%.

As a result, you end up with different effective tax rates even though the system is considered a "flat" tax rate system.

[sid dicious]

49. Not having looked at other threads

But why should someone with no skills, no experience and no education make more than $15000?

Sorry if I didn't read your thread or other threads. I deserve the flames I will receive if it was covered.

<putting on flame resistant suit>

[Cleita]

54. Why should someone with no skills, no experience and

no education become President of the United States?

[sid dicious]

59. But seriously, do you have a answer to my question?

Hating Bush is fine...but c'mon why?

[Cleita]

64. Many people with education and skills are not adequately

compensated for these anyway, mainly women. What makes you think that being a janitor isn't a skill that requires knowledge of various chemicals and their effects on where they are used? It also requires a certain amount of strength. Do we not reward the football player for his strength? So why not the janitor?

A lot of high wage compensating jobs really don't require all that much skill and education, models and strippers for instance? Anyone who invests eight hours a day in hard work deserves a living wage. Anyone else will get compensated because of the demand for what they do, not their skills and education.

Example, back in the 1970's my husband owned a restaurant. At that time Reagan was governor in California and he cut away funding for grants that were keeping academics employed. These out of work researchers had to find other employment. My husband hired some of them. There was a time when the majority of our staff had Phd's. They got paid the going wage for restaurant workers like anyone else.

Incidentally, the one high school drop out, on our staff, Mitzi, made the most money, because she made the most tips. Why? She had big boobs and didn't mind displaying a lot of them. She had no skills nor education, but she had something that was in demand and got compensated for it. Your argument doesn't have legs.

[sid dicious]

74. I like what you're saying and that's the sort of thing that

makes me feel good.

I think that the majority of professions are noble and of value...maybe not of value forever (like telephone operators) but they definitely have a place in our society.

However, a job like janitor is something that can be learned easily usually. Not the maintenance man running the sprinkler systems, mowing the lawn, coordinating repairs with contractors...that is a skilled position that would require an AA degree in many cases and not everyone can do it.

A janitor might need to know about chemicals, but not necessarily. It is a low skilled position that will be paid less. Than the maintenance superindendant.

Women are still getting paid less, but I definitely know that it's not in all cases and all industries (no I'm not talking adult-films :).

As for the woman with big boobs getting more tips. That's something that I would feel wrong about controlling. But I think it's also wrong to tip someone purely because they're good looking. Especially when service is the main priority (unless you're in a strip club).

It's just not that easy for me. I like some things about our capitalist society and others seem unfair. But at what cost do we make it fair? And will that necessarily make it fair?

What do the Europeans do about this sort of stuff?

[alcuno]

56. Probably so that I don't trip over them when I walk down the street.

40 hours/week is 40/hours a week whether you are cleaning floors or running the office. Both provide a needed service and both should be compensated. No one is saying that they should be earning the same amount, but isn't the janitor entitled to AT LEAST a livable wage?

[sid dicious]

61. Is he entitled I dunno.

I know alot of folks who commute over 100 miles a day to get to work in the SF Bay Area so that they can afford to live in the outlying areas.

But then there are folks living in the Bay Area for whom $50K isn't enough to live in the particular town of their choice. But does that mean that they should get a pay raise in order to meet the living wage for that area?

Maybe the CEO of a company could bring in his kid to do some of the Janitor work and pay the kid $6 an hour or bring in illegal workers to do it for that amount. Get a robot mop or whatever to do the work. It's not leaving much choice in the hands the people who do the hiring.

Now don't get me wrong. If you're for a more socialistic form of Democracy...then he this makes great sense. Just would take a major revamp in how we do business (make illegal alien hiring severely punished, get rid of unions and have government do that role, make it illegal for corporations to move overseas, etc.) --- please this is my stupid opinion so don't ask for links ---

It's noble, but it ain't something that can happen without major upheaval.

[alcuno]

66. I'm not talking about illegal workers, I'm talking US citizens.

When urban living becomes too expensive for people, that can hurt the economy of that area. You need people to work at the grocery store, pick up the garbage, drive buses, and, yes, clean the office buildings. Affordable housing is in the best interest of a community and can hurt the economy when it is not available.

You don't know if workers are entitled to a livable wage? You think that's socialism? I'm not talking about people receiving wages so that they can live anywhere they want in whatever kind of home they want. I'm talking about wages that allow people to simply live. Big difference.

By the way, we made child-labor illegal in this country because it exploited children. Among other labor laws, it allowed for the creation of the middle class in this country. I don't want us racing to compete with China from a standard of living standpoint, I'll take Sweden instead.

[sid dicious]

69. Good Point

Again, to use the SF Bay Area as an example, the cost of housing here went through the roof during the 90s due to the tech boom. People were getting great wages, huge stock option grants and in many cases these were unrealistically inflated.

Janitors, teachers, social workers, manual laborers (except for construction) all got the shaft during this period.

When the boom ended. The house prices still stayed up. And alot of the former tech workers had to move out of the state or move in with families. Which also sucked.

I just don't know where we draw the line. Were the tech workers who could no longer get a good paying job entitled to get the pay to maintain their lifestyle in order to stay in Ca.

No argument here about the living wage. But what is that in relation to the value of the job being performed? There is no relation of course since the living wage is a minimum wage. But will it cause companies to do things like hire illegal workers or leave states?

[alcuno]

70. No, I don't think you are entitled to pay to maintain your lifestyle.

It's unfortunate what happened to the tech industry in California and those workers will have to take lower pay or move elsewhere. For most, I would think that they have the financial means to at least be able to make that decision.

I don't know the exact amount of a livable wage but I do believe that it depends on where you live. I'm reasonably assured that the current minimum wage, which has not changed in several years, is not a livable wage. Working 40 hours each week for 52 weeks earns you $12,500. I don't know anywhere in the US where that is a living.

There are things that the state and federal governments can do to encourage businesses to stay and grow in the United States. There are nations throughout Europe that are able to keep their citizens employed and provide health care for all. We need to start asking ourselves why we seem unable to do that. What is it about the United States that makes us unable to create a good standard of living for all. What is it about Canada that allows them to have citizens with decent jobs, healthcare, and a budget surplus. With which countries are we competing? The Europeans and Canadians or the Chinese and South Americans? I know which is "good" for business, but which is good for our citizens?

[cirej2000]

71. What happened to our country since the 70s to make earning

a living so damned hard. It's just sad. I would't compare us to Canada though...500 billion square miles (exaggeration) and about 40 million people.

[cirej2000]

65. Well you might want to spend some time reading the posts...

So ya don't start a flame-war. But yeah, you ask a good question and didn't get flamed.

$15000 isn't enough for someone to live on anywhere these days I don't think. I think that this one is a tough one in so many ways. But I'd rather not have folks robbing and living in the streets and have a couple of businesses inconvenienced.

:shrug:

[wanderingbear]

63. Poor people shouldnt have to pay taxes at all..

It makes no sence to build a country on the backs of those who cant afford it..

[alcuno]

67. Welcome to DU, wanderingbear.

Not only does it not make sense, it does not work.

[Cleita]

68. You're so right.

Everyone needs to be adequately compensated for their labor, no matter how humble that labor it. Welcome to DU.