Inheritance Tax Should be Abolished

[Gumby]

..

 

[bright eyed]

I guess I should say I am opposed to the progressive tax system as we have it.

Our current tax system is forced charity. I believe in charity, I support our church and several other organizations. However, I feel it should be my choice as to who get my money and not some inefficient government agency.

Well, a lot of great organizations that serve people for various reasons receive a majority of their support from government agencies, not private sources. And I can tell you that government grants are the most gigantic pain in the patooty ever - you have to give a very detailed accounting for every penny spent - so this is the area I would consider there is the least amount of waste going on.

There were many who were opposed to increasing the minimum wage - yet you don't see the consequence of keeping some people at such low incomes that they cannot afford decent housing, feed/cloth their children etc etc etc. So if you don't want to pay via taxes, than do you support increased wages?

Everyone on the "anti-taxes" side says "why can't i keep what i earn" - but what about those who are not earning enough to sustain a decent living? and none of us want to "live" with the consequences of a low-income community - stressed to the hilt, self-medicating w/ drugs and drink etc.etc...

Then, people don't want kids to be abused (physically or emotionally), starved or have other poor outcomes - which often can be ammeliorated by increasing their family income...so all these service agencies pop up to provide things that aren't provided - most often because of their family income status...

I absolutely believe that people have to take responsibility for their own lives - but I also understand how crazy life can be (and disfunction plus stress produces more disfunction, not less)- and these services help keep people off the streets, help babies stay healthy and parents stay sane....

Rustic, perhaps we have to force charity because you cannot assume everyone is like you and believes in it nor would support it at adequate levels to sustain the standard of living most people expect in the states. take away the safety nets and it will all come undone quite quickly.

 

[TickTock]

Well, top 10% net worth of US households is ~$1mm. Surely, the top 10% are "rich" and don't need to pass on all that money, do they? 55% of wealth above that level?

Median net worth of US households in 2000 was $55,000. Adjusted up to 2007 levels, surely the top half can help the bottom half? 55% of wealth above that level?

Anyone here in favor of either of those proposals? Or, lowering the tax rate until the 10% or median change becomes revenue-neutral??


The other thing I don't get is exemptions for farms and family businesses. Apparently, that is 'good' wealth, while owning, say, stock in a publically traded business or bonds is 'bad' wealth.

 

[samclem]

Honest question: Is that '50% pay no taxes' accurate? I think it means no 'income taxes'. They still pay SS and medicare and local sales taxes (and 'hidden taxes' in products that corporations must pass to the consumer).

Some of those income stats really bother me - aren't they based on 'filers' rather than the entire population? Not sure what to make of them.

-ERD50

Right, to be accurate i should have said "nearly 50% pay zero (or less) net federal income taxes."

The figures for 2006: (from The Tax Foundation - Number of Americans Paying Zero Federal Income Tax Grows to 43.4 Million).

"roughly 43.4 million tax returns, representing 91 million individuals, will face a zero or negative tax liability. That's out of a total of 136 million federal tax returns that will be filed. Adding to this figure the 15 million households and individuals who file no tax return at all, roughly 121 million Americans—or 41 percent of the U.S. population—will be completely outside the federal income tax system in 2006. This total includes those who pay no tax, and those who pay some tax upfront and are later refunded the full amount of the tax paid or more."

Note that the 15 million non-filing households are, according to another link, those who were not required to file because they don't earn enough. So, add in a lot more for people who don't file because they are breaking the law (What's the figure for illegal aliens--maybe 10-15 million? ) and I'll bet we're pushing 50% of the population.

None of this includes the effects of AFDC ("welfare"), food stamps, and other relief payments to people. If we include these payments, then the number of "net takers" would climb even farther. But, that is a tough argument to make, since nearly everybody is a recipient of government payments, goods, or services of some type.

Still, at least at the federal level, close to 50% of the people pay nothing or even receive money on tax day. Why would these people vote for a decrease in taxes? They are the a huge chunk of the electorate and they benefit by higher taxes. An inherently unstable situation that makes tax reform very difficult.

 

[Rustic23]

When the government took over taking of the poor two classes of people were hurt. The givers and the receivers. Lyndon Johnson started the War On Poverty. That is not a political statement, just a statement of fact. Since then Trillions of dollars have been given to the poor to wipe our poverty, and it has not worked. All we succeeded in doing was creating a welfare state with more people, both the poor and the bureaucrats that run the programs living off the public doll. Taking more of my money and giving it away will not solve the problem of the poor. Never has, Never will.

Nothing bugs me more than the adds 'It's your money so be sure to file for your unearned tax credit'!

 

[youbet]

Merry Christmas.

Not very politically correct....... Isn't it "Happy Holidays" so that folks of non-Christian persuasions aren't offended?

Oh yeah....... Merry Christmas Martha!

 

[Freein05]

That so called 50% that do not pay taxes is false. Almost all states have a regressive sales tax that they pay. You are also forgetting another regressive tax that takes a big bite out of every working persons check and that is the Social Security and Medicare Tax.

I am happy I make enough money to pay taxes. Would you like to or would you be able to live on the income it takes to receive the earned income tax credit. Be serious! You also must mot be familiar with welfare payments today. They can only be collected for 5 years. I would also question any reports produced by The Tax Foundation. How do you expect people who do not even make enough money to live on to pay taxes? They only tell the half truth when they say 43% of Americans do not pay Federal Income tax. That may be true but they say nothing about the other taxes as stated above they pay. Which our all flat taxes.

I wish all of you Rich and Poor a Merry Christmas!

 

[ERD50]

An observation:

An observation:

(Martha, you can take your fingers out of your ears for a minute - this really shouldn't hurt - I promise )...

Some of us get pretty passionate about this topic, we get heated up and it does seem to get divisive at times. But I truly think that is because we are much, much more *alike* than we are different.

Most people on both sides of this issue really, really want the same thing (stay with me here ). Our hearts are torn when we see a story of a poor child in a poor home in a poor neighborhood with poor schools and little in the way of positive role models. We all know that kid has the deck stacked against them. It is sad.

Now, the difference that I see is:

A) Some of us feel that some strict redistribution of wealth administered by the government is a big part of the solution.

B) Some of us feel that 'A' is actually counter-productive, and creates more long term misery than it solves.

So we want the same thing - we differ on the best approach.

There will always be anecdotal evidence to support either view. You can't test the theories in a petri dish. We can look to countries with strong socialist histories, but there may be too many variables to come to conclusions.

Peace on Earth - ERD50

 

[armor99]

Everyone on the "anti-taxes" side says "why can't i keep what i earn" - but what about those who are not earning enough to sustain a decent living? and none of us want to "live" with the consequences of a low-income community - stressed to the hilt, self-medicating w/ drugs and drink etc.etc...

Then, people don't want kids to be abused (physically or emotionally), starved or have other poor outcomes - which often can be ammeliorated by increasing their family income...so all these service agencies pop up to provide things that aren't provided - most often because of their family income status...

I absolutely believe that people have to take responsibility for their own lives - but I also understand how crazy life can be (and disfunction plus stress produces more disfunction, not less)- and these services help keep people off the streets, help babies stay healthy and parents stay sane....

Rustic, perhaps we have to force charity because you cannot assume everyone is like you and believes in it nor would support it at adequate levels to sustain the standard of living most people expect in the states. take away the safety nets and it will all come undone quite quickly.

Ok... there are just a few problems with the above thinking bright eyed. I do value your opinions, but I disagree with a few things here.

While it is a nice idea the thought of the govt being able to take care of "everyone", it is really just not possible. It is completely impossible to create a society where no one is poor, or suffering, or ill. When people suggest the very notion that povery can be eliminated... they are either trying to get money from you, or are not thinking clearly. A more constructive and realistic conversation might be, for a prosperous healthy democracy, what should the percentage of poverty be? 2%, 5%, 10%? As a matter of fact you might even use such statistics to go about figuring out how "healthy" an economy is by such figures.
You also mention "what about those who are not earning enough to sustain a decent living?" My question to you would be.... why are they not earning enough? For every reason you can give me why they are unable to do any better for themselves, I can give you three other things they could do to try to legally earn more money. How is my giving others more money that I had to work hard for, going to help their situation other than in some temporary way? I would be in favor of more tax money going for free education classes, that would at least help to "teach a man to fish" vs. giving a man a "fish".
I guess the point that I am trying to make here, is that while it is a great and noble idea to want to be able to help people, the one question that always gets overlooked, is "at what cost"? If you try to eliminate the poor class by bankrupting everyone else to do it, then obviously that was not a smart move. If you raise taxes for more programs in education, and you can prove that over a number of years that program graduated folks that went on to be self sufficiant, then maybe that was a wise use of the money.

 

[FinanceDude]

If you raise taxes for more programs in education, and you can prove that over a number of years that program graduated folks that went on to be self sufficiant, then maybe that was a wise use of the money.

Isn't that what "No child left behind" was supposed to do?

 

[samclem]

That so called 50% that do not pay taxes is false. Almost all states have a regressive sales tax that they pay. You are also forgetting another regressive tax that takes a big bite out of every working persons check and that is the Social Security and Medicare Tax.

Please see post 154. I clarified that I was referring to the federal income tax. That's the tax that pays for running the country at the federal level. Everyone benefits from having a federal government, and now approx 50% of people are paying for it.

Taken in total, there's nothing regressive about the Social Security taxation and benefit system. Low wage earners get back far more of every buck they put in than do high wage earners. In fact, what was designed as an inter-generational wealth transfer system has become an inter-class wealth transfer system, too. When the cap is removed (and it surely will be), this will become even more pronounced. It is now a pseudo-welfare system, which will become more evident when we start means-testing the benefits.

People can be on welfare for "only" 5 years. Heartless.

I'm happy that you think taxes are great. Please, pay all that you want! In fact, if you feel that you aren't being taxed enough, it is easy to give a "gift" to the US government (the mechanism is already in place) and you can give until your conscience is satisfied. Mine is more than satisfied at the present level of taxation. Don't forget (as mentioned previously) that the US Government is now taking in more money than ever before. I guess it's just not enough, is it? I wonder when it will be "enough".

 

[Rustic23]

In the last 50 years we have seen a change in how we look at folks that accept welfare. 'There is no shame is being poor'

Just as the adds urge people to file for there unearned tax credit there are adds telling people that there is no shame in being poor and such. This has bread a society that to some extent accepts welfare as a right. I saw a news report of an 18 yr. old welfare daughter with two kids say 'I'll do just fine, it was OK for my mother so it's just fine with me'. Now I admit this may be an exception, but the willingness to use food stamps, WICK, and other handouts has changed the attitude of the poor and toward the poor.

If you redistributed all the wealth in the US today, within a year or so you would have poor people needing assistance.

 

[samclem]

And, the "poverty level" keeps rising. We do have people in this country who have very little and do not live in a way I would chose to live. Still, we should recognize that, by standards of most of the world today, we have no "poor" people in this country. If an individual in sub-Saharan Africa, or the US of 60 years ago was given a description of the lifestyle and possessions of a "poor" American family today, that lifestyle would be seen as firmly middle-class.

So, by some objective measures, the "war on poverty" has been won, but we don't believe we are better off. The call for more assistance will apparently never cease. The poverty that comes from lack of self-worth and lack of self-respect (from being dependent on others) is more fundamental and more crushing than poverty caused by lack of "things." Our grandparents knew this, we've forgotten it.

Now, those who are mentally ill or on drugs aren't filling for assistance and are often worse off than "functional" poor people, but we have different societal roadblocks that are preventing us from dealing with those problems.

 

[Rustic23]

The war on poverty does seem to be won! However, politicians stay in office by continued funding!

The Census Bureau's report on poverty in America has shown about 37 million people live in official poverty.

The following are facts about persons defined as “poor” by the Census Bureau, taken from a variety of government reports:

46 percent of all poor households actually own their own homes. The average home owned by persons classified as poor by the Census Bureau is a three-bedroom house with one-and-a-half baths, a garage, and a porch or patio.

80 percent of poor households have air conditioning. By contrast, in 1970, only 36 percent of the entire U.S. population enjoyed air conditioning.

Only six percent of poor households are overcrowded; two thirds have more than two rooms per person.

The typical poor American has more living space than the average individual living in Paris, London, Vienna, Athens, and other cities throughout Europe. (These comparisons are to the average citizens in foreign countries, not to those classified as poor.)

Nearly three quarters of poor households own a car; 31 percent own two or more cars.

97 percent of poor households have a color television; over half own two or more color televisions.

78 percent have a VCR or DVD player.

62 percent have cable or satellite TV reception.

89 percent own microwave ovens, more than half have a stereo, and a more than a third have an automatic dishwasher.

 

[TickTock]

No takers on lowering the estate tax to $1mm or to the median net worth and leaving the rate at 55%? Not even one? ? ?

 

[ERD50]

No takers on lowering the estate tax to $1mm or to the median net worth and leaving the rate at 55%? Not even one? ? ?

In my profession, 1M means 1,000,000.

So, if by '$1mm' you mean a million million ($1,000,000 times $1,000,000), then sure! Those are the really rich &*$%^@*() - take their money from e'm, I'll NEVER be that rich!

-ERD50

 

[samclem]

No takers on lowering the estate tax to $1mm or to the median net worth and leaving the rate at 55%? Not even one? ? ?

Of course not! This is supposed to be a tax on RICH people, not us!!

 

[kombat]

80 percent of poor households have air conditioning. By contrast, in 1970, only 36 percent of the entire U.S. population enjoyed air conditioning.

Rustic, I agree with the sentiment of your post, but factoids like the one I quoted are very misleading and cheap, in my opinion. One could just as easily say:

"99% of poor households have a telephone. By contrast, in 1870, less than 1% of the entire planet had a telephone."

The truth is that technological advances get dramatically cheaper as time goes on. Things that start out as luxuries become necessities. That doesn't mean we're getting lazier or softer, it just means that mankind is doing exactly what it's supposed to: improving quality of life. You could make the same arguments about televisions, microwaves, or all kinds of other technologies that were very expensive initially, but are practically free now. It's disingenuous to use such tactics in a debate like this and reveals biases. It makes it look like you're trying to cheat to exaggerate your point, when the facts alone are enough to make a perfectly valid argument.

 

[samclem]

Kombat,
Just so I understand: Why, in 2007, is a microwave oven a necessity for a poor person when it was not a necessity for anyone in 1970? We're not talking about lifesaving technology here, we're talking about convenience and keeping up with societal perceptions. And I'm ALL for convenience, but I don't call it necessity.

If taxpayers are to pay for anything for the poor, then they should pay for necessities. The bar is already well above that. Also, when on the dole, you are a dependent on others, and those "others" should have an increased say in how you live your life as a condition of this support (like kids living at home. We're talking about chronological adults who have not become self-sufficient.). Some of these conditions might be mandatory drug testing, limits on the types of food and accomodation provided, keeping free of the criminal justice system, doing public work that needs to be done, etc.

 

[kombat]

Kombat,
Just so I understand: Why, in 2007, is a microwave oven a necessity for a poor person when it was not a necessity for anyone in 1970?

Well strictly speaking, very little of anything we have are "necessities." Do I really *need* a car, or a bus pass for that matter? I could just wake up 4 hours early and walk to work. Do I really *need* more than one shirt? I could just wash it every night (by hand, of course) and let it dry while I sleep.

Microwave ovens were not widely owned by anyone in 1970. Sales volume in 1970 was only 40,000. However, sales grew to over a million by 1975. My objection was that it appears Rustic (or the original source of the statistics) cherry-picked a period during which hardly anybody had microwaves, because they were brand-new. It'd be like looking at fax machine numbers between 1960 and 1990 and claiming it had something to do with indulging ourselves. The truth is they didn't exist back then.

Finally, I would consider a microwave oven a necessity, especially for poor people. It allows a family to cook more food than necessary, so that they'll have leftovers they can refrigerate and heat up later, rather than having to fire up the stove/oven for every meal. It saves money in the long run, in my opinion. It's a tool people can use to reduce their costs, not a luxury indulgence that should remain available only to the well-heeled.

We're not talking about lifesaving technology here, we're talking about convenience and keeping up with societal perceptions. And I'm ALL for convenience, but I don't call it necessity.

As I said, the location of the line delimiting "necessity/convenience" is entirely subjective. You may consider a wristwatch a convenience, whereas I would consider it a necessity. I may consider a cell phone a convenience while someone else might not be able to imagine life without it. I don't mention this to provoke a debate about these specific items, but rather to point out that it is arrogant for any one of us to proclaim that our classification system is authoritative. Furthermore, the simple passage of time and the economies of scale make these items much more easily accessible, even while we debate their position on the "convenience/necessity" spectrum, to the point where the debate doesn't even matter anymore. Who cares that poor people have color TV's? You can pick one up for free if you just drive around your neighborhood on garbage day. It might not be pretty, but the price is right.

If taxpayers are to pay for anything for the poor, then they should pay for necessities. The bar is already well above that.

I agree with your first statement, but I'm not sure the "bar is well above that." I would consider housing, heating, food, and clothing to be necessities, but unless the US welfare program is more generous than I'm aware of, I don't believe current payments are enough to fund all of those needs and more, as you appear to be claiming. Maybe I'm wrong (I'm in Canada), but I'd be surprised to learn this is the case.

Also, when on the dole, you are a dependent on others, and those "others" should have an increased say in how you live your life as a condition of this support.

This is a very controversial position, but I actually agree with you. As long as someone is sitting on their butt watching Oprah, cashing checks funded by my tax dollars, I don't believe they should be indulging in nightly booze benders, or smoking a pack a day at the local bingo hall. However, people do deserve at least a little enjoyment in life, and you'll never get everyone to agree how much is "fair." Unfortunately, the only truly fair solution is to not even try to dictate how they spend their money, and simply give them enough to get by. If they choose to spend that money on non-necessities, and end up going without the essentials, that's their problem, in my opinion.

 

[TickTock]

In my profession, 1M means 1,000,000.

So, if by '$1mm' you mean a million million ($1,000,000 times $1,000,000), then sure! Those are the really rich &*$%^@*() - take their money from e'm, I'll NEVER be that rich!

-ERD50

heh.

Yes, I meant $1,000,000.

 

[Rustic23]

First the microwave was not referenced to 1970's so I don't know how that got into the discussion above.

As for Air Conditioning in the 70's, it was a pretty common item around these parts and far from a luxury item. Sure they could have said it was 0% in the 1870's, but I don't find it out of line to compare it to the 1970's. After all when did the 'War on Poverty' begin?

Ever been at the grocery store and been behind someone with WIC coupons? Ever notice the other things they were buying, like beer, candy, cakes, potato chips, etc.? So I buying their milk and eggs so they can aford their beer.

 

[ERD50]

Also, when on the dole, you are a dependent on others, and those "others" should have an increased say in how you live your life as a condition of this support

This is a very controversial position, but I actually agree with you.

Controversial!!!

Maybe THAT is the problem! This should NOT be viewed as controversial!

This is exactly how I was raised, and I bet that the majority of productive people were raised this way. I'm raising my kids this way, and so far, so good. While your parents help provide for you, you are beholden to their rules. They have a say in how you live your life. I think we are better off for it.

If someone expects to be helped by someone who is successful, maybe they could learn a thing or two from that successful person. Maybe they should be forced to listen (education in exchange for help, guidelines in exchange for help). The goal is for them to not need help in the future (unless we are talking people with permanent disabilities here).

-ERD50

 

[Freein05]

Hollywood is looking for someone to play Scrooge in the new version of the A Christmas Carol. I sent them a link to this thread and told them there are a lot of good candidates here.

 

[Rustic23]

P. T. Barnum is also looking for another sucker, maybe he would be interested in this thread also.