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Old 03-22-2017, 03:29 PM   #26
Original Position
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Re: socialism has never worked?

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Originally Posted by Black Peter View Post
There is no possible way to run a socialist country by only taking from the very rich. They don't have enough to support the system. The fact is that they have to take from the middle class as well. And they take it from them in spades.

http://www.nytimes.com/roomfordebate...t-you-wish-for

I'm sure you'll say that the NYT is a right-wing paper and should be banned on this forum.


Sweden’s top marginal tax rate of 56.9 percent applies to all income over 1.5 times the average income in Sweden.
Norway’s top marginal tax rate of 39 percent applies to all income over 1.6 times the average Norwegian income.

The US top marginal tax rate of 46.8 percent kicks in at 8.5 times the average U.S. income.

So the capitalist country is the only one actually doing what you want... taxing the rich more than everyone else.
This is very misleading. First of all, the top income rate in the US applies to individuals making over 400K - that is much higher than 1.6 times average income. Second, you should be comparing effective tax rates, not marginal tax rates. Here is a chart of the effective tax rate plus social security for those making over $300K:





As you can see, as of 2012 Americans earning over 300K pay 30.5%, whereas the Swedes pay 49.8% and Norwegians pay 49.7% for combined income and social security taxes. You can argue over whether or not this is a good thing, but it is false to claim that rich Americans pay more in income taxes than rich Scandinavians.

EDIT: I think I misread your point on the first criticism which is more about middle class rates , but I'll maintain my criticism of using marginal instead of effective rates.

Last edited by Original Position; 03-22-2017 at 03:34 PM. Reason: misread post
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Old 03-22-2017, 03:32 PM   #27
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Re: socialism has never worked?

I didn't make that claim. You completely missed the point. The point is that the middle class in Scandinavia are paying heavily for their system. This was a counterpoint to the claim that only the very rich have their stuff taken from them.
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Old 03-22-2017, 03:36 PM   #28
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Re: socialism has never worked?

In fact, I have to ask why the rich in Scandinavia are in the same tax bracket as the middle class? Shouldn't they be in a higher tax bracket? Someone's getting screwed!
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Old 03-22-2017, 03:45 PM   #29
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Re: socialism has never worked?

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In fact, I have to ask why the rich in Scandinavia are in the same tax bracket as the middle class? Shouldn't they be in a higher tax bracket? Someone's getting screwed!
Progressive taxation is not the best way to reduce inequality. Post-tax transfers are more effective:



EDIT: I'm not saying that progressive taxation isn't also helpful, but the US is not an outlier there.

Last edited by Original Position; 03-22-2017 at 03:46 PM. Reason: I keep hitting publish too quickly
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Old 03-22-2017, 03:56 PM   #30
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Re: socialism has never worked?

You're still arguing a completely different point.
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Old 03-22-2017, 04:01 PM   #31
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Re: socialism has never worked?

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You're still arguing a completely different point.
I'm answering the question you asked.
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Old 03-22-2017, 04:11 PM   #32
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Re: socialism has never worked?

Again, my original point was that the middle class in Scandinavia are paying heavily for their system. This was a counterpoint to the claim that only the very rich have their stuff taken from them.

And the site you linked to agrees.

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Rich nations have discovered that in order to get a large quantity of tax revenues, it’s best to tax everyone — not just the rich — fairly heavily. That’s partly because a not-too-progressive tax system will generate less political opposition from the rich
Do you disagree? Do you think that only the very rich get their stuff taken from them in the socialist system? Everyone else gets off easy?
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Old 03-22-2017, 04:48 PM   #33
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Re: socialism has never worked?

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Again, my original point was that the middle class in Scandinavia are paying heavily for their system. This was a counterpoint to the claim that only the very rich have their stuff taken from them.

And the site you linked to agrees.



Do you disagree? Do you think that only the very rich get their stuff taken from them in the socialist system? Everyone else gets off easy?
No, I don't disagree. Significant increases in government spending would probably require more taxation on the middle and lower classes. Progressive taxation is fine, I support it, but I think there is more potential to reduce inequality through government transfers than from making the tax code more progressive.
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Old 03-22-2017, 05:07 PM   #34
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Re: socialism has never worked?

Ok, fair enough. I'm happy to move into the new topic.

Please explain what you propose with post tax transfers and how they would work exactly in your ideal world.
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Old 03-22-2017, 07:44 PM   #35
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Re: socialism has never worked?

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Progressive taxation is not the best way to reduce inequality. Post-tax transfers are more effective:



EDIT: I'm not saying that progressive taxation isn't also helpful, but the US is not an outlier there.
i read the entire paper but im not sure what post-tax transfers mean. is it something like these payrolltaxes?
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Old 03-22-2017, 11:52 PM   #36
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Re: socialism has never worked?

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i read the entire paper but im not sure what post-tax transfers mean. is it something like these payrolltaxes?
No. A post-tax transfer just means government spending on social programs, eg education, healthcare, retirement, welfare, etc.

Think of it like this. Let's say there is some base level of income inequality based on wages and investment returns. If the government uses a flat income tax, the inequality after the tax would be the same. If the government uses a progressive income tax, the inequality after the tax will go down. This is because the government took a higher proportion of income from higher than average earners and a lower proportion from lower than average earners. That is one way government policy can affect income inequality.

However, another way government policy can affect inequality is through spending. For instance, let's say a country had a flat tax rate at 50%, which is then distributed equally to everyone (i.e. a post-tax transfer). That would also reduce inequality, because people who make more money pay more in taxes even at a flat rate, whereas the distribution is the same for everyone.
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Old 03-23-2017, 12:09 AM   #37
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Re: socialism has never worked?

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Ok, fair enough. I'm happy to move into the new topic.

Please explain what you propose with post tax transfers and how they would work exactly in your ideal world.
Meh. I don't really care that much about ideal worlds. But sure, ideally I prefer consumption taxes to income taxes. I think the declining marginal utility of money, investments in education, and social insurance gains imply utility gains to some government redistribution. I think the usual suspects here are fine: education, healthcare, retirement, welfare, infrastructure, etc.
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Old 03-23-2017, 08:41 AM   #38
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Re: socialism has never worked?

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Meh. I don't really care that much about ideal worlds. But sure, ideally I prefer consumption taxes to income taxes. I think the declining marginal utility of money, investments in education, and social insurance gains imply utility gains to some government redistribution. I think the usual suspects here are fine: education, healthcare, retirement, welfare, infrastructure, etc.
Again, i agree with you in theory. It's all very nice when explained like that.

So tell me exactly what post-tax transfers you'd like to see, precisely how much will they cost, and how will a country like the USA pay for it?

Even more importantly, how would a country that is NOT rich in resources pay for all this? Or should rich countries fork over benefits to poor countries? After all, it's not fair to leave them out in the cold just because they were unlucky enough to be born in a ****ty place, right?
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Old 03-23-2017, 08:57 AM   #39
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Re: socialism has never worked?

Are you asking someone on a forum to write up an entire national budget proposal?
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Old 03-23-2017, 02:01 PM   #40
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Re: socialism has never worked?

Something less vague than, "These post-tax transfers are gonna be yuuuge! They're gonna be beautiful! And the Mexicans are gonna pay for it. Just trust me!" would be nice.
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Old 03-23-2017, 02:07 PM   #41
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Re: socialism has never worked?

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Something less vague than, "These post-tax transfers are gonna be yuuuge! They're gonna be beautiful! And the Mexicans are gonna pay for it. Just trust me!" would be nice.
"Who is going to pay for that?" is typically asked by this ignorant FOX-news reporter who hardly ever read a book in his life.

in the paper that was linked there was a propasal how to change the tax-system, on the last 2 pages when i remember correctly.
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Old 03-23-2017, 02:11 PM   #42
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Re: socialism has never worked?

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Something less vague than, "These post-tax transfers are gonna be yuuuge! They're gonna be beautiful! And the Mexicans are gonna pay for it. Just trust me!" would be nice.
I favor a system of progressive taxation with marginal tax rates.

http://www.investopedia.com/terms/p/progressivetax.asp
Quote:
What is a 'Progressive Tax'

A progressive tax is a tax that takes a larger percentage from high-income earners than it does from low-income individuals. The U.S. income tax system is considered progressive. In 2016, individuals who have under $9,275 of taxable income pay 10% in income tax, while taxpayers earning more than the benchmark cutoff of $415,050 fall into tax brackets with rates up to 39.6%.
BREAKING DOWN 'Progressive Tax'
The progressivity of a tax structure depends on how quickly the tax rates rise in relation to increases in income. For example, if one tax code has a low rate of 10% and a high rate of 30%, and another tax code has income tax rates ranging from 10% to 80%, the latter is more progressive.

The Advantages of a Progressive Tax

Progressive tax systems reduce tax burdens on people who can least afford to pay them, and these systems leave more money in the pockets of low-wage earners, who are likely to spend all of their money and stimulate the economy. Progressive tax systems also have the ability to collect more taxes than flat taxes or regressive taxes, as tax rates are indexed to increase as income climbs. Progressive taxes allow the people with the greatest amount of resources to fund a greater portion of the services all people and businesses rely on, such as roads, first responders and snow removal.
Disadvantages of Progressive Taxes

Critics of progressive taxes consider them to be discriminatory against wealthy people or high-income earners. These critics believe the U.S. progressive income tax is effectively a means of income redistribution, based on the myth most taxes are used to fund social welfare programs. However, only a small portion of government spending is devoted to welfare payments.
Difference Between Progressive Tax and Regressive Tax

The opposite of a progressive tax, a regressive tax, takes a larger percentage of income from low-wage earners than it does from high-wage earners. Sales tax is an example of a regressive tax because if two individuals buy the same amount of goods or services, the sales tax constitutes a higher percentage of the lower-earning individual's wages and a lower percentage of the higher-earning individual's wages.
Difference Between Progressive Tax and Flat Tax

Unlike progressive and regressive tax systems, a flat tax system does not impose different tax rates on people with different income levels. Instead, flat taxation imposes the same percentage tax on everyone regardless of income. For example, if everyone is taxed at 10%, regardless of income, this is a flat tax.

The U.S. payroll tax is often considered a flat tax because it taxes all wage earners at the same percentage. However, as of 2016, this tax is not applied on earnings over $118,500, and as a result, it is only a flat tax for people earning under that amount. Taxpayers earning over that amount pay a lower percentage of their total income in payroll tax, making the tax regressive.
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Old 03-23-2017, 04:59 PM   #43
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Re: socialism has never worked?

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Again, i agree with you in theory. It's all very nice when explained like that.
Good.

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So tell me exactly what post-tax transfers you'd like to see, precisely how much will they cost, and how will a country like the USA pay for it?
I've already told you what transfers I'd like to see: government spending on things like healthcare, education, retirement, welfare, etc. I think there are many forms these transfers can take, which are more or less efficient and equitable. Cost depends on the program obviously, and a country like the US pays for it through taxation.

Quote:
Even more importantly, how would a country that is NOT rich in resources pay for all this?
Taxation, foreign aid, NGOs and so on.

Quote:
Or should rich countries fork over benefits to poor countries?
Sure, foreign aid is helpful. I don't think it is the secret to creating a growing economy, which is the most important thing for a poorer country. That has more to do with rule of law, entrepreneurship, free trade, and historical factors.

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After all, it's not fair to leave them out in the cold just because they were unlucky enough to be born in a ****ty place, right?
I agree it isn't fair.
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Old 03-23-2017, 05:04 PM   #44
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Re: socialism has never worked?

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Something less vague than, "These post-tax transfers are gonna be yuuuge! They're gonna be beautiful! And the Mexicans are gonna pay for it. Just trust me!" would be nice.
This is a inaccurate characterization of my views.
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Old 03-23-2017, 08:10 PM   #45
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Re: socialism has never worked?

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"Who is going to pay for that?" is typically asked by this ignorant FOX-news reporter who hardly ever read a book in his life.

in the paper that was linked there was a propasal how to change the tax-system, on the last 2 pages when i remember correctly.
You're the guy who said only the very rich will pay. LMAO. You don't even understand the basics.

Get an education before you run your squeaker.

Last edited by Black Peter; 03-23-2017 at 08:16 PM.
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Old 03-23-2017, 08:10 PM   #46
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Re: socialism has never worked?

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This is a inaccurate characterization of my views.
I wasn't responding to you in that post.
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Old 03-23-2017, 08:16 PM   #47
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Re: socialism has never worked?

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Originally Posted by Original Position View Post
Good.



I've already told you what transfers I'd like to see: government spending on things like healthcare, education, retirement, welfare, etc. I think there are many forms these transfers can take, which are more or less efficient and equitable. Cost depends on the program obviously, and a country like the US pays for it through taxation.



Taxation, foreign aid, NGOs and so on.



Sure, foreign aid is helpful. I don't think it is the secret to creating a growing economy, which is the most important thing for a poorer country. That has more to do with rule of law, entrepreneurship, free trade, and historical factors.



I agree it isn't fair.
Again, this is all very vague. How much exactly will it cost? Who will pay? How much will each person have to pay exactly? How will this affect the economy? Motivation to succeed?

It all sounds wonderful when vague terms are used. When the bill comes due, however, it all sounds very different.

I'm not a fan of true capitalism, because only a few get rich and everyone else sucks it. I'm also not a fan of true communism because then everyone sucks it. Are you suggesting a point along that continuum or are you buried at one end? I personally would like more socialism than the USA, but less than Scandanavia.
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Old 03-23-2017, 08:48 PM   #48
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Re: socialism has never worked?

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Again, this is all very vague. How much exactly will it cost? Who will pay? How much will each person have to pay exactly? How will this affect the economy? Motivation to succeed?
This isn't an exam. Pick a question and I'll answer it as best I can, but don't keep giving me lists of questions.
Quote:
It all sounds wonderful when vague terms are used. When the bill comes due, however, it all sounds very different.
Okay.
Quote:
I'm not a fan of true capitalism, because only a few get rich and everyone else sucks it. I'm also not a fan of true communism because then everyone sucks it. Are you suggesting a point along that continuum or are you buried at one end? I personally would like more socialism than the USA, but less than Scandanavia.
I'm not sure what you mean by "true communism" or "true capitalism." In general though, I think capitalism has been a boon to human prosperity and happiness and communism has not. I am generally opposed to public ownership of the means of production.
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Old 03-23-2017, 09:10 PM   #49
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Re: socialism has never worked?

These are all standard questions for someone with your position, but ok, we can start with one.

How much will it cost to do all the things you would like see done?
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Old 03-24-2017, 12:28 AM   #50
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Re: socialism has never worked?

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These are all standard questions for someone with your position, but ok, we can start with one.

How much will it cost to do all the things you would like see done?
Probably somewhere between 25 - 48% of GDP in developed countries.


(Tax Revenue as a share of GDP)

Will it help if we skip ahead to where I acknowledge that taxes can create deadweight loss and disincentivize working?
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