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View Diary: A Tale of Two Americas (259 comments)

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  •  A progressive consumption tax is the correct way (6+ / 0-)

    We are always going to have a hard time getting a progressive income tax in place because some people, wrongly, see it as taxing hard work.  But a progressive consumption tax, with tax free contributions to universities etc. for the rich and tax free purchases like college tuition for the not rich allowed, would not be so politically difficult.  Why should rich people throw lavish multi-million dollar parties while Americans suffer?  A consumption tax would fix that - work hard, save up for your kids education or donate to charity but if you want to blow America's wealth on nonsense then you have to pay taxes on it.

    •  How about a waste tax (4+ / 0-)
      Recommended by:
      opinionated, disrael, neroden, speak2me

      instead...national tipping fee (what is paid for disposal at the landfill), combined with a carbon tax, extra tax on imported oil, and incentives for durable/recyclable/reusable products. Use proceeds to build sustainable energy and transport infrastructure, subsidize durable products built to last (so poor can afford them), and to pay down the deficit, as well as lowering the rates of regressive taxes such as the payroll tax.

      And consumption tax, if applied, should not apply to basic goods required by families below the 80th income percentile.

      "Trickle down economics 101: They get the golden parachute, we get the golden shower"

      by NoMoreLies on Tue Nov 09, 2010 at 10:23:52 AM PST

      [ Parent ]

      •  Agreed (2+ / 0-)
        Recommended by:
        NoMoreLies, neroden

        There is just a lot more flexibility in the consumption based side of taxing.  All kinds of policies are possible once you track what money is spent on.  For instance let corporations and the ultra-rich make campaign donations - but tax them at 95% and use the money collected to fund unbiased media - betcha the campaign donations will dry up fast.

      •  Bloomington, IN did something like this (14+ / 0-)

        when I was in undergrad (early 1990s). If you put trash out, each can or bag had to have a $1 tag on it. No tag, no pick up. Curbside recycling ran each week & was free. Needless to say, we did a heck of a lot of recycling! I still do because of the habits the town of Bloomington forced upon me (socialists!)

      •  NO to a waste fee...I live on the outskirts of (0+ / 0-)

        A major southern California area and the dumping out here just now started to decrease because going to the dump is affordable. Please don't tax waste more at the dumps, it means I'll be seeing more dumped couches, used motor oil, regular trash bags on the side of the roads and in any open area you can get to. We just got this cleaned up and species are beginning a comeback!

        •  Yeah, trash fees should just cover costs (0+ / 0-)

          I think it's fair for trash fees to cover landfilling, baling, and transportation costs and related stuff, and arguably also any recycling costs (which are less than landfilling costs for the same amount of stuff), but they shouldn't be used to cover other programs.  

          If you do that they're not so expensive that people start fly-tipping, or at least few enough people do it that they get arrested and suppressed.

          -5.63, -8.10. Learn about Duverger's Law.

          by neroden on Tue Nov 09, 2010 at 04:09:36 PM PST

          [ Parent ]

          •  Maybe not on the back end (disposal) (0+ / 0-)

            but on the front end...an extra tax on shoddily made, non-recyclable, non-reusable, non-compostable goods, or do like Germany did and force the manufacturers to take them back and deal with the disposal.

            "Trickle down economics 101: They get the golden parachute, we get the golden shower"

            by NoMoreLies on Tue Nov 09, 2010 at 09:39:29 PM PST

            [ Parent ]

    •  That's insanely regressive and destructive (13+ / 0-)

      The poor "consume" every damned dime that touches their fingers while the rich spend only a tiny fraction of the the wealth they aquire.

      Do you really want to be the last loser still mimeographing the KISS Army Newsletter?

      by JesseCW on Tue Nov 09, 2010 at 10:35:36 AM PST

      [ Parent ]

      •  it could easily be set up so it wasn't regressive (6+ / 0-)

        though doing that would bring on the same screams from the 1%ers as a progressive income tax.....

        Personally imo just taxing gains and any income not derived from actual work at the same levels as regular income would do the same if not more to increase revenue.....with an estate tax that kicks in on any transfer over say, 5 million....That would cover 95% of the "small business" and "family farms" that the reepers scream about so loudly.....

        "Guess who's laughing while the world explodes, When we're all crybabies Who fight best among ourselves" John Joseph Lydon

        by buddabelly on Tue Nov 09, 2010 at 10:55:34 AM PST

        [ Parent ]

        •  Absolutely. All income should be taxed at the (5+ / 0-)

          same rate no matter how it's obtained.

          If I gamble in the market, or if I buy ramshackle houses and fix them up and sell them at a profit (profit made on sweat equity), or I play cards, or if I dig ditches...what business is it of Uncle Sams?

          As long as what I do is legal, I ought to pay the same.

          Do you really want to be the last loser still mimeographing the KISS Army Newsletter?

          by JesseCW on Tue Nov 09, 2010 at 11:20:04 AM PST

          [ Parent ]

          •  If your money just sits there making more of (2+ / 0-)
            Recommended by:
            alizard, neroden

            itself, instead of out there in the economy being traded for goods and services, then you can pony up a bit more than 15%. Think of it as paying rent for your money. After all, if it's not out there doing anything, it ought to be paying for the privilege of being lazy money. :D

            In more seriousness, why wouldn't we flip the tax structure upside down--15% on income earned from doing a job, and 25-55+% on money that your grandpa made that just sits there making more of itself out of thin air.

            You'd still get breaks if you put the money into college funds, retirement funds, or basic interest-bearing savings accounts (not to exceed the interest rate on said savings accounts). Stuff with a direct benefit and the ability to provide for you or your family down the line.

            But for all that stock investment, hedge funds (want a hedge fund, this one might be a good option for you), "securities" (if you want to invest in securities, open a lock making business), and other funny-money nonsense that got us into this mess in the first place--you pay into the social safety net to play.

            If you want to take crazy risks, you're going to have to stick around to help clean up when they go all asplodey. Like an "accidental death or dismemberment" policy for the economy.

            I 'ship Obama/America. OTP

            by athenap on Tue Nov 09, 2010 at 12:30:29 PM PST

            [ Parent ]

            •  If your money makes you enough that (0+ / 0-)

              you can afford to bear a higher burden, then certainly.

              But I see no reason a day-trader who manages to make 30k a year should pay any more or any less than a security guard who makes 30k sitting around reading a book.

              Government shouldn't be in the business of deciding that one way of making a living is morally superior to another, if both are legal.

              The breaks for college funds, retirement funds, ect. need to fucking end.  They're huge hand-outs to people with means and they're immensely unfair, particularly to people who live in high cost of living areas.

              30k in NYC, no tax dodges for you.  You had to spend it all to live and you can't afford to buy.

              30k in Cedar Rapids, hide 10k of it in mortgage interest deduction, IRA, college account, ect.

              I'm in favor a tax fairness.  Not welfare determined solely by geography.

              Do you really want to be the last loser still mimeographing the KISS Army Newsletter?

              by JesseCW on Tue Nov 09, 2010 at 02:49:36 PM PST

              [ Parent ]

              •  Then day-trader income should pay social security (0+ / 0-)

                tax.  Currently, even APART from the super-regressive Bush tax cuts, the day trader doesn't pay SS tax and the security guard does.

                -5.63, -8.10. Learn about Duverger's Law.

                by neroden on Tue Nov 09, 2010 at 04:10:48 PM PST

                [ Parent ]

                •  If that daytrader is self-employed, he/she (0+ / 0-)

                  best be paying SE Tax/FICA-like taxes.

                  Self-employed people

                  A tax similar to the FICA tax is imposed on the earnings of self-employed individuals...
                  Under the SE Tax Act, self-employed people are responsible for the entire percentage of 15.3% (= 12.4% [Soc. Sec.] + 2.9% [Medicare]); however, the 15.3% multiplier is applied to 92.35% of the business's net earnings from self-employment, rather than 100% of the gross earnings; the difference, 7.65%, is half of the 15.3%, and makes the calculation fair in comparison to that of regular (non-self-employed) employees. It does this by adjusting for the fact that employees' 7.65% share of their SE tax is multiplied against a number (their gross income) that does not include the putative "employer's half" of the self-employment tax. In other words, it makes the calculation fair because employees don't get taxed on their employers' contribution of the second half of FICA, therefore self-employed people shouldn't get taxed on the second half of the self-employment tax. Similarly, self-employed people also deduct half of their self-employment tax (schedule SE) from their gross income on the way to arriving at their adjusted gross income (AGI). This levels the amount paid by self-employed persons in comparison to regular employees, who don't pay general income tax on their employers' contribution of the second half of FICA, just as they didn't pay FICA tax on it either.[9][10]

                  Republicans: "Double your pleasure, double your fun, double your National Debt, and blame 'The One' "

                  by Bluefin on Wed Nov 10, 2010 at 01:55:56 AM PST

                  [ Parent ]

      •  How about just a luxury tax. Certain cars, (4+ / 0-)

        house over a certain value, multiple houses, expensive vacations, yachts..actually any boat with an onboard motor that doesn't have a sail, expensive jewelry.  Let's tax those things that poor people just don't buy.  

        "When fascism comes to America, it'll be wrapped in a flag and carrying a cross." Sinclair Lewis

        by lakehillsliberal on Tue Nov 09, 2010 at 11:19:55 AM PST

        [ Parent ]

      •  A small transaction tax on financial trades (2+ / 0-)
        Recommended by:
        neroden, Bluefin

        makes the most sense.

        There are I don't know how many billions of trades every year--much of it churn to make a quick buck, with no substantive economic value.

        Just add a $1 tax to every buy and sell order and you'd bring in billions with no burden on the average American.

        The financial houses are still making tons of money with their fees for buying and selling and why not have "we the people" get in on the action?

        Some people fight fire with fire. Professionals use water.

        by Happy Days on Tue Nov 09, 2010 at 03:18:59 PM PST

        [ Parent ]

        •  That should be done to prevent churning, anyway (1+ / 0-)
          Recommended by:
          Bluefin

          But don't do it as a dollar on every order.  Be fair to the small guy!  Do it as a percentage of the dollar amount.

          A tax of 0.1%, a dollar on every $1000, for EVERY trade including those made by computer programs and market makers, would stop the high-frequency-trading scam and force the markets back to some form of rationality.  And it would raise a lot of money.

          -5.63, -8.10. Learn about Duverger's Law.

          by neroden on Tue Nov 09, 2010 at 04:14:55 PM PST

          [ Parent ]

    •  How would you collect it? (1+ / 0-)
      Recommended by:
      Marie

      Would the caterer collect it and pass it on like sales tax? And if by "progressive" you mean the caterer would charge the Moneybaggs more than the Sixpacks for a wedding, who's to judge what rate to charge?

      •  Lots of options in Wikipedia (2+ / 0-)
        Recommended by:
        Leo in NJ, FarWestGirl

        A consumption tax is a tax on spending on goods and services. The tax base of such a tax is the money spent on consumption. Consumption taxes are usually indirect, such as a value added tax. However it can also be structured as a form of personal taxation, as a sales tax, or as an income tax that deducts investments and savings. A direct consumption tax may be called an expenditure tax, a cash-flow tax, or a consumed-income tax, and can be flat or progressive. Expenditure taxes have been briefly implemented in the past in India and Sri Lanka.

    •  A consumption tax will always be regressive, (3+ / 0-)
      Recommended by:
      Marie, Bluefin, FarWestGirl

      there's no escaping it, no matter how it's structured. The fact that we once had a progressive income tax means that people can recognize the essential justice and fairness of it, but someone (I don't know, Democrats?) has to reframe the debate so that we recognize trickle-down just doesn't work.

    •  It won't work (2+ / 0-)
      Recommended by:
      Marie, Bluefin

      For the very simple reason that the very wealthy cash hoarders are doing just that, hoarding cash, not spending it.  For a consumption tax to touch them, they have to do just that, consume.  All a consumption tax would do is incentivize them to hoard more.  We need taxes on cash holdings and cash investments so the cash hoarders have an incentive to reduce the size of their hoard.

      From such crooked wood as that which man is made of, nothing straight can be fashioned. -Immanuel Kant

      by Nellebracht on Tue Nov 09, 2010 at 11:44:58 AM PST

      [ Parent ]

      •  No there is already such a tax - inflation tax (1+ / 0-)
        Recommended by:
        neroden

        and with QE2 we are now making that inflation tax a real concern for anyone hoarding the US dollar.  The problem is not hoarding it is lack of trade and financial regulation.  Without trade regulation we have no jobs.  Without financial regulation we have no way to invest in anything without the banks taking a ridiculous vampiric cut.

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