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Bernie Sanders calls for wealth tax

Discussion in 'Sports and News' started by YankeeFan, Sep 8, 2014.

  1. LongTimeListener

    LongTimeListener Well-Known Member

    All right.

    Household wealth then. Or net worth. It's still majorly fucked up.
     
  2. Songbird

    Songbird Well-Known Member

    And half of that is ours! /China
     
  3. doctorquant

    doctorquant Well-Known Member

    Yeah, but when you get your head around the real figures (or even close to the real figures), that pot of gold that's going to solve all our problems isn't nearly big enough, is it?

    Suppose we confiscated ALL of the seize-able wealth of the top 400 families. That's $2 trillion. And all we did is pay down the national debt (ignore the payments on the debt that will actually go to those families). Where are you now? You've done nothing towards infrastructure, education or any other "neglected national priorities." Your national debt is still $15 trillion. And, oh by the way ... neither they, nor next year's top 400 (or 4,000 or 4 million), are gonna hop to it to create that next big pile of cash, knowing that the rest of us, to "be fair," might help ourselves to it.

    So what are you going to do then?

    Sanders doesn't give a shit, because he knows (I think) that he's proposing a model that depends on our ability to divide by zero ... But he sprouts a little chubby and gets those of like mind all hot and bothered. Panem et circenses, I suppose ...
     
  4. LongTimeListener

    LongTimeListener Well-Known Member

    Well, right now we have a system that when every tax is factored in, each household pays about 20 percent. We also have huge, huge breaks that are available only to the wealthy. Deferred income, mortgage interest (on all homes, not just the primary residence), 15 percent rate on capital gains, etc.

    That isn't too good either.
     
  5. Baron Scicluna

    Baron Scicluna Well-Known Member


    You are assuming the entire $2 trillion would be used for the debt, unlike Sanders, who proposes it not just for the debt, but for infrastructure, education, etc. why can't it be, say $1 trillion each?
     
  6. doctorquant

    doctorquant Well-Known Member

    Wrap your head around these numbers (based on 2008, when earnings had peaked):

    The top 400 household returns reported about $87 billion in income. If we stipulate that those returns ALL reflected the scandalous effective rate of 15%, that led to a little over $13 billion in federal taxes received.

    Now, let's go all Bernie Sanders here and assume that we're going to quadruple the effective rate at which those folks pay. That's right ... they're going to pay 60% on every dollar they earn. The U.S. treasury would then receive, from them, a little over $52 billion from those folks. That's a $39 billion increase, which ain't pocket change. But then again ...

    In 2008 the U.S. government took in, in total (corporate and individual receipts) ... $1.45 trillion. A $39 billion bump in those receipts would have been less than a 3% increase. If the feds had taken every dime of the top 400 households' 2008 earnings, that would have led to a only 5% increase in federal tax receipts.

    You want to make some serious headway on the receipts side of the federal ledger? Sorry, you ain't gonna do squat unless you're ready to go after far smaller fry than those who are in the 0.25%.
     
  7. LongTimeListener

    LongTimeListener Well-Known Member

    OK, I'd go up to 2 percent then.

    But really I'd settle for a realistic look at taxation. The latest bargaining put the marginal rate increase at a couple with a taxable income of $450,000. But with deductions and all, that "taxable income" of $450,000 is more like a real income of about $600,000.
     
  8. Batman

    Batman Well-Known Member

    Which is the real idiocy -- and danger -- of this proposal.
    It starts at the top .25 percent because, hey, they can afford it.
    Until they either leave the country, figure out another loophole, or simply don't have it any more. So then it becomes the top 1 percent because, hey, they can afford it -- and we can do it now. The precedent has been set.
    And so on.
    Once the government gets its hand in a pocket it never, EVER removes it. It also never balances the other half of the ledger, which is to keep its spending in check. If the government has an extra $2 trillion, can anyone say with a straight face that it'll go toward rebuilding infrastructure or paying down debt? I'll bet you that $2 trillion and then some that it ends up going to waste, padding the pockets of politicians, and on new projects and programs.
    This is also the first step a lot of banana republics have taken toward illegitimacy. Venezuela, for one, seized all of the foreign oil assets in the name of social justice.
     
  9. LongTimeListener

    LongTimeListener Well-Known Member

    These were the predictions when California hiked its tax rate a couple of years ago on people making more than $1 million a year. (Hi, Phil Mickelson!)

    The rough estimate of the number of those people who have moved is zero.
     
  10. Amy

    Amy Well-Known Member

    It doesn't look like his proposal is particularly radical. I think he's suggesting that the estate tax exemption be reduced to $3.5 mm (currently $5.34 mm and adjusted annually for inflation) and imposes rates of 40% to 55%, depending on the size of the estate (currently 40%).

    Before the temporary phase-out of the estate tax, the exemption was only $600,000 and top rates were 55%.
     
  11. MisterCreosote

    MisterCreosote Well-Known Member

    [​IMG]
     
    Last edited by a moderator: Dec 15, 2014
  12. The Big Ragu

    The Big Ragu Moderator Staff Member

    There already is a de facto wealth tax in this country. Ben Bernanke and Janet Yellen have had a variety of names for it, under the general headings of ZIRP and QE. It's been incredibly effective in stealing the savings of millions of Americans, most of whom only vaguely realize that the declining purchasing power of their savings, and their inability to find low-risk income anywhere, has been a boon to the Federal government, which would be overrun by its current debt and continued spending without central planners who are rigging the interest rate market and screwing over millions of people who have their eyes on all of the wrong things. Added bonus is that by incentivizing little old ladies, who simply wanted relatively safe retirement income, and all of the $100,000 multimillionaires out there (who are overleveraged up their wazoos), into riskier and riskier assets, they have created some nifty asset bubbles (stocks, bonds, San Francisco real estate, artwork) that will conceivably create a crash worse than the one they caused in 2007 / 8 from their previous yeoman's work rigging interest rates.

    They are not going to pass a wealth tax (not that they should; that shit has worked out really well for France). And they are not going to reign in spending. Those ideas are unpopular. It's much easier to do it with stealth, by debasing the dollar instead. Same net effect, except that kind of "wealth tax" disproportionately hits people with meager savings. It takes it from them without them ever having to write a check; much easier.
     
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