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Post by Nitrorebel on Jun 7, 2006 15:03:54 GMT -5
Don't get your point HiFi. If you bust up your money instead of passing it on, the government makes money on the consumption taxes. Unless you bust it all up in the Bahamas. It's all about opportunity cost, and if consumption is your next best opportunity... The point is taxes will be paid either way. Using Rawls' difference principle, I think it is more just to levy a tax that disproportionately affects the wealthiest of people.
Now that is assuming you're making the normative assumptions I am. You may also want to factor in the external cost of having a vast population of poor people without healthcare, and a vast swath of people working in badly-paying jobs. For those that didn't think there WAS an external cost to wide-spread poverty and working poor, I would've thought Katrina drove that point home nicely. It seemed to have done so to everyone else. Even The Economist, squarely in your camp, denigrated US budget and taxation policies the week after Katrina in a cover story. Thinking it's all about what is mine is mine regardless, is extremely short-sighted. Economic theory and budget policies are about a whole lot more than just about what you think you deserve because you worked so hard (funny, how it's mainly white males who think that way...women and minorities, and basically the bulk of the world population doesn't seem to agree): there are almost 300 million other people in your country to think about besides you. Again, I thought Katrina made that clear. Amazing how many people were surprised at the racial divide exposed. I wasn't after 6 years of living in one of the most racially segregated cities I've ever come across.
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hifigator
Platinum Hoya (over 5000 posts)
Posts: 6,387
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Post by hifigator on Jun 7, 2006 16:44:09 GMT -5
Don't get your point HiFi. If you bust up your money instead of passing it on, the government makes money on the consumption taxes. Unless you bust it all up in the Bahamas. It's all about opportunity cost, and if consumption is your next best opportunity... The point is taxes will be paid either way. Using Rawls' difference principle, I think it is more just to levy a tax that disproportionately affects the wealthiest of people. Now that is assuming you're making the normative assumptions I am. You may also want to factor in the external cost of having a vast population of poor people without healthcare, and a vast swath of people working in badly-paying jobs. For those that didn't think there WAS an external cost to wide-spread poverty and working poor, I would've thought Katrina drove that point home nicely. It seemed to have done so to everyone else. Even The Economist, squarely in your camp, denigrated US budget and taxation policies the week after Katrina in a cover story. Thinking it's all about what is mine is mine regardless, is extremely short-sighted. Economic theory and budget policies are about a whole lot more than just about what you think you deserve because you worked so hard (funny, how it's mainly white males who think that way...women and minorities, and basically the bulk of the world population doesn't seem to agree): there are almost 300 million other people in your country to think about besides you. Again, I thought Katrina made that clear. Amazing how many people were surprised at the racial divide exposed. I wasn't after 6 years of living in one of the most racially segregated cities I've ever come across. Get off your stinking high horse. That is the biggest pile of feel good nonsense I have heard in quite some time. But in any case you are still debating a different issue. You are debating the question of taxation versus government services. In essence you are "justifying" (at least in your own mind) taxes in general. Although I would debate you on that topic as well, in this case my question is totally different. This is theoretical since we are dealing with theory. I have accumulated wealth amounting to 3 million dollars over my lifetime. Now let's say that I am 70 years old. I sell off my houses, real estate etc.. Of course when I do that I pay income taxes on my profit/capital gains. I liquidate everything and now have $3 million in cash. Say I die at 75. Here are two scenarios: I squander all of my money on my 5 last lavish years doing whatever. (You mention "consumption" tax such as sales tax) Yes there will certainly be some of that. In 5 years I die penniless. My "heirs" get nothing. or I live off of my social security entirely and keep the cool $3 million in the bank. I die 5 years later at 75. My son inherits the $3 million. Under the estate taxes in place prior to the cuts, the first $300,000 is tax exempt. I don't know the exact rates, but the taxes kick in at $300,000 and the top rate was a whopping 55%! For argument sake, let's say that the next $1.7 million was taxed at 25% and the last million at the 55% rate. Now my son receives $2.03 million ($300,000, $1.28 million, and $450,000). The government steals nearly a million dollars. Under the laws in place now, the first $2 million is tax free. The third million is still taxed at the 55% rate. So the government steals $550,000 and my son inherits $2.45 million. He will doubtlessly spend his $2.45 million on an assortment of things, the vast majority of which will be taxed. His gasoline will be taxed. His purchases of almost everything except groceries and medicine will be taxed. Etc... Effectively, my terrible judgement and total lack of self control resulted in an extra $550,000 being put into the economy and $550,000 less being put into government. How is that a good thing from your point of view? If you are so pro government as you appear, why would you want to have a system in place which encourages this type of rash behavior and why would you want to discourage the very taxes which you are so much in favor of? The bottom line is that you have still given zero reason why their should be a double tax if my heirs spend the money but not if I do. Try one more time to justify your point without simply giving a generalized logic of why we need taxes in the first place.
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SFHoya99
Blue & Gray (over 10,000 posts)
Posts: 17,791
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Post by SFHoya99 on Jun 7, 2006 20:33:45 GMT -5
Some Death Tax Facts Currently the death tax produces less than 1% of federal revenues annually. Compliance costs more than that for estate planning, etc. Capital gain revenue derived from heirs selling inherited assets (at the decedent's tax basis) will more than make up for a death tax revenue loss. Small business owners, farmers and ranchers have to spend billions on insurance ($13 billion per year estimate) to protect their heirs. This is a dead-weight loss to the US economy. Whose money is it anyway? is a ridiculous argument given that the country shelters you nightly. you summed up the basic problem with socialist thought in this line. i would argue that my existance is not owed due to the benevolence of the government. If the estate tax is an inefficient methodology of taxation, then I'd get rid of it. But I WOULD replace the revenue with an increase somewhere else, more efficiently. As for the second part, what, are you ana anarchist? Do you really think society would be more enjoyable without police, laws, courts, national defense, health codes, infrastructure, etc? You want to be Mad Max? That's all I'm saying. Government should serve the people, but nothing provides services for free.
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SFHoya99
Blue & Gray (over 10,000 posts)
Posts: 17,791
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Post by SFHoya99 on Jun 7, 2006 20:42:02 GMT -5
The bottom line is that you have still given zero reason why their should be a double tax if my heirs spend the money but not if I do. Try one more time to justify your point without simply giving a generalized logic of why we need taxes in the first place.
I will try one last time and if you don't get it, I'll just assume you are either too stupid or not trying.
Double taxation exists everywhere. Corporations are taxed, assets are taxed, income is taxed.
The government needs a certain amount of money. You and I may disagree on that amount, but can we agree that they need some money to function?
Can we also agree that the amount of money they need should be determined by the cost of services they provide and should not determined by some moral argument that "governments only need 23% of our income?" As if 24% would be immoral?
So the government needs X amount of dollars. Currently, it funds that money through a variety of ways. If you remove the estate tax (fine by me), you need to generate more cash through another tax. (as an aside, this other tax will certainty occur BEFORE an estate tax would, losing you money).
So, if you agree that the revenue from an estate tax would need to be replaced, there is no reason to argue the moral implications of an estate tax.
Or, if you think the revenue from an estate tax would not need to be replaced, you're really arguing that taxes should be lower, which has nothing to do with the morality of the estate tax methodology.
Nitro is right in the sense that if taxes are morally allowable, estate taxes are generally so as well. The only basis I see here is if you are against progressive taxation.
But your "double taxation" argument is stupid. Fine. I'll just double your income tax and you can pay me NOW, and not after you're dead.
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Post by Nitrorebel on Jun 8, 2006 4:44:48 GMT -5
Thank you SF.
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Post by dairishhoya on Jun 8, 2006 5:06:02 GMT -5
HiFi--2 billion people in the World live on less than $2.00 a day ... seriously, make sure you buy some perspective with the money left over from being double taxed.
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VelvetElvis
Silver Hoya (over 500 posts)
pka MrPathetic
Posts: 934
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Post by VelvetElvis on Jun 8, 2006 7:03:02 GMT -5
NitroRebel: "Bust it up in the Bahamas" - Wow! I am going to use this ALL THE TIME. It is going to replace Berman's "You're with me, Leather" as my go to.
What are you up to tonight?
VE: "Well, I am going to go bust it up in Camelot"
Where are you going for dinner?
VE: "I am going to bust it up in Popeye's!"
It just sounds like a party, man!
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FormerHoya
Golden Hoya (over 1000 posts)
Posts: 1,262
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Post by FormerHoya on Jun 8, 2006 9:11:21 GMT -5
NitroRebel: "Bust it up in the Bahamas" - Wow! I am going to use this ALL THE TIME. It is going to replace Berman's "You're with me, Leather" as my go to. What are you up to tonight? VE: "Well, I am going to go bust it up in Camelot" Where are you going for dinner? VE: "I am going to bust it up in Popeye's!" It just sounds like a party, man! Can I go too? Popeyes and Camelot, sounds like a night I'd like to "bust it up in."
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hifigator
Platinum Hoya (over 5000 posts)
Posts: 6,387
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Post by hifigator on Jun 8, 2006 12:53:22 GMT -5
The bottom line is that you have still given zero reason why their should be a double tax if my heirs spend the money but not if I do. Try one more time to justify your point without simply giving a generalized logic of why we need taxes in the first place. I will try one last time and if you don't get it, I'll just assume you are either too stupid or not trying. Double taxation exists everywhere. Corporations are taxed, assets are taxed, income is taxed. The government needs a certain amount of money. You and I may disagree on that amount, but can we agree that they need some money to function? Can we also agree that the amount of money they need should be determined by the cost of services they provide and should not determined by some moral argument that "governments only need 23% of our income?" As if 24% would be immoral? So the government needs X amount of dollars. Currently, it funds that money through a variety of ways. If you remove the estate tax (fine by me), you need to generate more cash through another tax. (as an aside, this other tax will certainty occur BEFORE an estate tax would, losing you money). So, if you agree that the revenue from an estate tax would need to be replaced, there is no reason to argue the moral implications of an estate tax. Or, if you think the revenue from an estate tax would not need to be replaced, you're really arguing that taxes should be lower, which has nothing to do with the morality of the estate tax methodology. Nitro is right in the sense that if taxes are morally allowable, estate taxes are generally so as well. The only basis I see here is if you are against progressive taxation. But your "double taxation" argument is stupid. Fine. I'll just double your income tax and you can pay me NOW, and not after you're dead. OK, you have finally made yourself clear. You are essentially not arguing the "validity" of estate tax, but rather saying that govenment "needs" all of the revenues that it has and if we eliminate or cut the estate tax that those monies will need to be made up somewhere else. Fair enough. I would argue that there should be a scaling back of the "services" which governent provides us with. I thnk most on this board have said something similar. There is far too much pork in the budget. There are far too many government expenditures which either don't need to be made or could be made far more efficiently. That is essentially the underlying question which I posed in the thread concerning our views of government. Still though you are not addressing the estate tax specifically. You are still addressing taxation in general. Whether you are justifying taxes as a whole because of the "need" for community services or whether you are saying that with the expenditures the government has it can't afford the cut in estate taxes, in either case you are still essentially arguing the general taxation question. As for your statement that double taxation exhists all over, I would reply so what? The fact that something bad already happens so therefore it's ok if it happens again is kind of silly wouldn't you admit? Again, here is a very specific question: (From the example before) If I consume the wealth, then I consume $3 million worth. If I decide to share it with my heirs then the government gets $550,000 and my heirs get $2.45 milliion. Where is any logic that justifies that? Don't say "oh the government "needs" the revenue for this that or the other." They were somehow going to get by without the revenue if I spent the money myself.
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Deleted
Deleted Member
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Post by Deleted on Jun 9, 2006 16:01:41 GMT -5
Hifi - flip it around: where's the logic in taxing every dollar of income I make (on some level), but exempting income that I receive as a result of an inheritance? It's all income to me....
And a big thank you to Senator George Voinovich (R-Ohio) for summing up where I stand: "Repealing the estate tax during this time of fiscal crisis would be incredibly irresponsible and intellectually dishonest."
Wouldn't it be nice for our President to show some leadership by saying something similar to Bill Frist and others who insist on pushing this forward? You can't increase spending while at the same time cutting revenue sources. If I proposed to my boss that I wanted to expand the scope of the program I run, but that I was going to stop fundraising for it, I'd be fired in about 90 seconds.
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hifigator
Platinum Hoya (over 5000 posts)
Posts: 6,387
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Post by hifigator on Jun 10, 2006 11:30:56 GMT -5
Hifi - flip it around: where's the logic in taxing every dollar of income I make (on some level), but exempting income that I receive as a result of an inheritance? It's all income to me.... And a big thank you to Senator George Voinovich (R-Ohio) for summing up where I stand: "Repealing the estate tax during this time of fiscal crisis would be incredibly irresponsible and intellectually dishonest." Wouldn't it be nice for our President to show some leadership by saying something similar to Bill Frist and others who insist on pushing this forward? You can't increase spending while at the same time cutting revenue sources. If I proposed to my boss that I wanted to expand the scope of the program I run, but that I was going to stop fundraising for it, I'd be fired in about 90 seconds. That's a decent point from that perspective. And if you look at it from the heir's point of view then that is somewhat logical. The problem I see is that it discourages what we should be encouraging. Simply put the government shouldn't be discouraging accumulating wealth. That grows both the economy as well as the government revenues. The more you tax something the less of the something that you get. That is proven economic principle. The more people have an incentive to build an estate for their family the more taxes they will be paying along the way. To then discourage accumulating the wealth rather than consuming the wealth just simply doesn't seem to make much sense does it?
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Post by Coast2CoastHoya on Jun 12, 2006 12:52:53 GMT -5
None of the above. How about the "environmentally conscious, believes in a balanced budget but understands the necessity of spending under certain circumstances, goes one way on some issues and the other on others, sees politics as a circle rather than a spectrum, decides things based on issues and not generalities or labels, forward-thinking, long-term looking, but doesn't forget the lessons of history, thinks it's important to listen to EVREYONE not just the ones voting for my side/lining my candidates' pockets, thinks people take themselves too seriously" option. I guess you could reduce that to "Young Alumni Section." Yeah, I said it!
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tgo
Silver Hoya (over 500 posts)
Posts: 803
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Post by tgo on Jun 14, 2006 11:02:33 GMT -5
From my hero, Rep. Ron Paul. "For smaller, family-owned farms and ranches, the estate tax is especially threatening. Such operations may be worth several million dollars when the value of land, livestock, buildings, and equipment are considered. Yet when the owner dies, his heirs often do not have liquid cash to pay a hefty tax bill. As a result, all or part of the family business may be sold to pay the IRS. This has accelerated the trend toward corporate ownership of American farms and ranches."
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Post by badgerhoya on Jun 14, 2006 11:13:47 GMT -5
From my hero, Rep. Ron Paul. "For smaller, family-owned farms and ranches, the estate tax is especially threatening. Such operations may be worth several million dollars when the value of land, livestock, buildings, and equipment are considered. Yet when the owner dies, his heirs often do not have liquid cash to pay a hefty tax bill. As a result, all or part of the family business may be sold to pay the IRS. This has accelerated the trend toward corporate ownership of American farms and ranches." Please. This is one of the biggest myths out there in support of repealing the estate tax. In 2000, with the old limits in place, just 1,659 farm estates had taxes due, of which 138 didn't report enough liquid assets to cover their tax liability. Now, with the current exemption level of $1.5m, only 300 farm estates in 2000 would have owed any tax at all -- and of those, just 27 would have a tax bill in excess of their liquid assets. Finally, with the $3.5m exemption set to take place in 2009, 65 farm estates would owe taxes and 13 would not have enough cash to cover the bill. [All figures from CBO study.] Needless to say, there's a reason why farmers are much more concerned with crop prices than they are with the estate tax.
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hifigator
Platinum Hoya (over 5000 posts)
Posts: 6,387
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Post by hifigator on Jun 14, 2006 13:24:49 GMT -5
From my hero, Rep. Ron Paul. "For smaller, family-owned farms and ranches, the estate tax is especially threatening. Such operations may be worth several million dollars when the value of land, livestock, buildings, and equipment are considered. Yet when the owner dies, his heirs often do not have liquid cash to pay a hefty tax bill. As a result, all or part of the family business may be sold to pay the IRS. This has accelerated the trend toward corporate ownership of American farms and ranches." Please. This is one of the biggest myths out there in support of repealing the estate tax. In 2000, with the old limits in place, just 1,659 farm estates had taxes due, of which 138 didn't report enough liquid assets to cover their tax liability. Now, with the current exemption level of $1.5m, only 300 farm estates in 2000 would have owed any tax at all -- and of those, just 27 would have a tax bill in excess of their liquid assets. Finally, with the $3.5m exemption set to take place in 2009, 65 farm estates would owe taxes and 13 would not have enough cash to cover the bill. [All figures from CBO study.] Needless to say, there's a reason why farmers are much more concerned with crop prices than they are with the estate tax. I find fault with your underlying premise. You basically say that "it''s OK, because it won't hurt that many people." Failed logic. Now as a refutation to someone making the point that farms are hit especially hard by the estate tax laws it is sound, but as an argument for the tax in the first place it is flawed.
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SoCalHoya
Golden Hoya (over 1000 posts)
No es bueno
Posts: 1,313
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Post by SoCalHoya on Jun 14, 2006 13:43:07 GMT -5
Sales tax hits the poor harder than anyone else. Should we ditch that as well?
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Post by Nitrorebel on Jun 14, 2006 13:48:09 GMT -5
No, because poor people don't donate to campaigns and don't vote.
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Deleted
Deleted Member
Posts: 0
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Post by Deleted on Jun 14, 2006 13:53:53 GMT -5
Please. This is one of the biggest myths out there in support of repealing the estate tax. In 2000, with the old limits in place, just 1,659 farm estates had taxes due, of which 138 didn't report enough liquid assets to cover their tax liability. Now, with the current exemption level of $1.5m, only 300 farm estates in 2000 would have owed any tax at all -- and of those, just 27 would have a tax bill in excess of their liquid assets. Finally, with the $3.5m exemption set to take place in 2009, 65 farm estates would owe taxes and 13 would not have enough cash to cover the bill. [All figures from CBO study.] Needless to say, there's a reason why farmers are much more concerned with crop prices than they are with the estate tax. I find fault with your underlying premise. You basically say that "it''s OK, because it won't hurt that many people." Failed logic. Now as a refutation to someone making the point that farms are hit especially hard by the estate tax laws it is sound, but as an argument for the tax in the first place it is flawed. Really? So we should make national policy based on the impact that it might have on a couple hundred people?
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Post by badgerhoya on Jun 14, 2006 14:18:16 GMT -5
Please. This is one of the biggest myths out there in support of repealing the estate tax. In 2000, with the old limits in place, just 1,659 farm estates had taxes due, of which 138 didn't report enough liquid assets to cover their tax liability. Now, with the current exemption level of $1.5m, only 300 farm estates in 2000 would have owed any tax at all -- and of those, just 27 would have a tax bill in excess of their liquid assets. Finally, with the $3.5m exemption set to take place in 2009, 65 farm estates would owe taxes and 13 would not have enough cash to cover the bill. [All figures from CBO study.] Needless to say, there's a reason why farmers are much more concerned with crop prices than they are with the estate tax. I find fault with your underlying premise. You basically say that "it''s OK, because it won't hurt that many people." Failed logic. Now as a refutation to someone making the point that farms are hit especially hard by the estate tax laws it is sound, but as an argument for the tax in the first place it is flawed. Here's the thing. The "family farm" argument has been strutted out as one of the key reasons why the estate tax should be repealed -- both because of the cultural significance of family farms, as well as because it's a better soundbite than coming right out and saying that repealing this tax is going to cut the taxes of multimillionaires. So, by removing the evidence that there's really any effect on family farms, it is simply reduced to a question of taxing the upper (call it) 1% of the population. (Of course, another reason to throw my hat in the ring here is because I've been around enough family farms to be able to see through the rhetoric that gets spewed around in DC about farming issues.) Now, personally I'm against the idea of repealing the estate tax entirely -- not purely for revenue reasons (though that is important in this age of ever-indebtedness), but also principally based on the idea that "to those to whom much has been given, much is required." I could go more deeply into that, but not at work.
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hifigator
Platinum Hoya (over 5000 posts)
Posts: 6,387
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Post by hifigator on Jun 14, 2006 23:19:37 GMT -5
Cam, I don't disagree that the "prudent" decision, and certainly from the socialist's viewpoint as yourself would be to do what's best for the most. All that I am saying is that such logic isn't sound for justifying the viewpoint. At some point everyone would be in the "minority" on an issue ... but our precedent would dictate that the majority "win."
Essentially that emotional type of justification is nothing more than class envy. Ironically, if taken to its logical conclusion, it would systematically eliminate those small groups, or shall we say ... the handful of unfortunate people in that category ... sounds an awful lot like some famous carcus once said .... "from each, according to his means and to each according to his needs."
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