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January 06, 2004

THE CLARK TAX CUT....Wes Clark unveiled his new tax proposal yesterday and it looks pretty good, both substantively and politically. Roughly speaking, it eliminates federal income tax for all families with incomes under $50,000, reduces taxes for all families with incomes under $100,000, and makes up the difference by increasing the tax rate on income over $1 million per year by 5 percentage points. In addition, it simplifies and expands the current set of tax credits for children. Details are here.

Comments:

  • My sister will hate it. She's constantly kvetching — and reasonably so — that politicians are forever pandering to families but never offer anything to single people. Clark's plan follows in that rich tradition.

  • It's a clear and straightforward attempt to add some more progressivity to the tax code. I like that. We really need to have a serious public conversation in this country about the value of a progressive tax system and Clark's plan is a good way to do that.

    Keep in mind that the 5% increase is only for income over $1 million, not on the first $1 million itself. The super rich have seen their pay increase by over 5x in the past couple of decades while their marginal tax rates have decreased by about 50%. Surely someone whose income has gone up from $1 million to $5 million can afford to give back a bit of that? This is a case we ought to be able to make.

  • There's another sense, however, in which Clark's plan is profoundly conservative. In today's dollars, the very first income tax was levied only on people who earned over $60,000, with a surcharge on income over $10 million. The federal income tax was originally conceived as a tax on the well off and the wealthy, not the working class.

  • The total amount of money involved is apparently fairly small: $30 billion in savings to middle class families offset by $30 billion in extra taxes on millionaires.

  • The plan is revenue neutral. For a presidential campaign this is the right way to go, but eventually we're going to have to face up to the necessity of either raising taxes or running deficits forever. Big government just isn't going to go away, no matter how loudly conservatives pretend that they want it to.

There's one sense in which I wish that we spent less time obsessing about income tax plans, since it's payroll taxes and sales taxes that actually make up most of the burden on working class and middle class families. What I'd really like to see is a proposal to make the Social Security tax progressive — or even just making it flat as a starting point. But that's an argument for another day. For now, Clark's plan is a very good one: simple, easy, and fair. I hope people listen to it.

Posted by Kevin Drum at January 6, 2004 10:27 AM | TrackBack


Comments

Dean's coming out with a proposal to reform payroll taxes.

"A top aide said Dean is considering a tax reform plan for the general election that includes a reduction in payroll taxes. If Dean rolls out such a plan, it could offset what many strategists see as a big liability: his support of what amounts to a nearly $2 trillion tax increase by calling for a repeal of Bush's tax cuts."

In the Wash Post today.

I think the strategy of holding back on the details for later is interesting.

Posted by: 537 votes at January 6, 2004 10:40 AM | PERMALINK

Interesting idea, eliminating all federal taxes for families who earn less than $50,000 per year.

But it looks to me like the best Clark and Kevin Drum can hope for is a 'converstation' about progressive taxation. I don't think Clark will have an opportunity to imprement his plan, as it's probably too late for him to stop Dean.

Posted by: Kevin Gregory at January 6, 2004 10:40 AM | PERMALINK

Your sister should remember that without a younger generation (i.e., the children being raised by families), there will be no one to pay for the debts we are incurring today, not to mention no one to wheel her around her nursing home.

Payroll taxes are complicated because they are going to Social Security and Medicare (at least at the federal level, and discussions about state taxes -- including sales tax -- ought to be conducted at the state level).

If we change federal payroll taxes, we'll have to admit that people aren't really paying into their own golden years, but for the retirement of their entire generation. In other words, face that SS and Medicare are a form of welfare for the elderly. See if you can get the AARP to admit it.

Posted by: PG at January 6, 2004 10:44 AM | PERMALINK

Revenue Nuetral.

Pretty sad we can't even bring in the subject of raising taxes. Please. Taxes are going way up--soon. We cannot run deficits like this forever--hell, not even in the next 5 years.

Not very brave stuff for a general. I know the rationale, all right? It's still weak and fearful. All public policy ideas around increased taxation are, it's just not Clark.

Posted by: paradox at January 6, 2004 10:49 AM | PERMALINK

Your sister should remember that without a younger generation (i.e., the children being raised by families), there will be no one to pay for the debts we are incurring today, not to mention no one to wheel her around her nursing home.

I'm really sick and tired of hearing about how everyone reproducing is such noble work and how I ought to subsidize it. Not everyone can have kids... why should I pay higher taxes because I can't? I'm with your sister, Kevin. Besides, if we weren't incurring the debts, we wouldn't need children to pay for them.

And I'll wheel myself around, thanks.

Posted by: four legs good at January 6, 2004 10:51 AM | PERMALINK

Re: Social Security -- the answer is not necessarily to cut the taxes on lower earners but to abolish the upper threshold.

Right now, employer and employee split a 12.4% tax on income up to a threshold of $68,000; any income earned over that threshold is not subject to the tax. This means that someone who earns $100,000 per year only pays 4.2% of that amount into Social Security taxes because $32,000 of that amount is exempt. So...someone earning $50,000 pays 6.2%, someone earning $100,000 pays 4.2%. Sounds like a classic regressive tax to me.

The SS system could use some major reforms, both in how funds are collected and how they are disbursed (especially wrt women), but I don't think abolishing the program is the answer. It's a safety net that protects us all -- the elderly who receive it, and their children who would otherwise be paying that money to support their parents in their old age.

Posted by: galnoir at January 6, 2004 10:53 AM | PERMALINK

quote: "..it's payroll taxes.."

YES! I don't think tackling sales tax will work since that's the realm of the states, and for some states that's all they can collect, but since we're financing the federal budget with revenue from the payroll taxes, then dammit, roll it into an income tax.

I'm sick of these buttheads saying they get taxed to death and never mentioning they get a 7.5% increase in take-home pay once they make over $87k/yr.

OK, no more derailing, I promise. I really like Clark, and I really like this plan. It's too bad he waited so long to get in the race, and the hemming & hawing about "well, am I a Democrat or not?" really turned me off. If he had two months of a jump on this, I think he'd have more of a chance than he does now. It's not over yet, but Dean is so far ahead in so many primary states...*sigh*

I like Dean too. I just like Clark more.

Posted by: Stoffel at January 6, 2004 10:54 AM | PERMALINK

Agreed that Clarke's plan looks good.

I'd rather increase the EITC than cut payroll taxes.

1) First, I kind of like the fiction that social security and the medi-whatever programs are self-funding. Hopefully, the self-funding fiction will somewhat limit the inevitable attempts of the retired classes to vote themselves more money.

2) Second, cutting SS loose means that the *next* national insurance program (probably single payer health insurance) will eventually metastasize into a welfare program.

Posted by: J Mann at January 6, 2004 11:02 AM | PERMALINK
If we change federal payroll taxes, we'll have to admit that people aren't really paying into their own golden years, but for the retirement of their entire generation.

Plans that require facing the truth are not to be criticized on that basis, I think. In terms of merit, if not political suitability.

Posted by: cmdicely at January 6, 2004 11:04 AM | PERMALINK
Second, cutting SS loose means that the *next* national insurance program (probably single payer health insurance) will eventually metastasize into a welfare program.

"National insurance programs" inherently are welfare programs. All contrary fictions are just that -- fictions.

Posted by: cmdicely at January 6, 2004 11:05 AM | PERMALINK

First, as to the disproportionate subsidization of those with children...

Being a poor, lonely grad student who still has his entire stipend counted a taxable income (thanks Speaker Gingrich!), I was for a long time sympathetic to those who kvetched about parents getting a disproportionate share of recent tax breaks. But then I realized that assuming said parents are responsible, all that extra money gets passed right on to their children via the care they provide them, and therefore since we're *all* children at some point in our lives, this aspect of our current tax policy actually seems relatively fair.

Second, as to the necessity of payroll tax relief:

I fully concur, and it seems that at least in some small way Wesley Clark does too. On his website's description of his plan, he does claim that his plan has "tax breaks for 3.2 million poor childless workers, which can be used to defray payroll taxes and work-related expenses."

http://www.clark04.com/issues/familiesfirst/

Posted by: Bill at January 6, 2004 11:05 AM | PERMALINK

I don't mind giving lower income people a big tax cut, I suppose, but I do think that this plan is unfair as a philosophical matter.

Families who earn less than $50,000 per year should contribute something to the federal government. It doesn't have to be a lot - even a token sum ($500? $1,000) would be fine - but it's wrong to give people a free ride. For one thing, it expands an artificial class divide. Under this plan, the rich will pay for the government, while the poor will not. That sets a frightening precedent. It is quite reasonable now, but it may be the first step down the slippery slope.

But the most important reason is that families (defined as a family of four, BTW) who earn less than $50,000 per year do receive many benefits from the federal government. They benefit from national defense, interstate highways, federal education subsidies...the list goes on and on and on.

It seems fundamentally immoral to get something for nothing. And you know what? People understand this. Most people don't want to be dependents who get services from the government for free. They want to contribute, even if the benefits they actually receive greater than their contribution. This is the fundamental principle behind the welfare to work legislation. Dependency is debilitating. Put another way, no one wants to be classed as a "have not;" They want to be considered a "have." This, BTW, is why the Republican economic message resonates with many middle-class voters.

For these reasons, I think that families who make less than $50,000 should contribute something, even if it isn't much and as a pracitcal matter has a negligible effect on revenue. It's a matter of principle. No one should get a free ride, and no one should be forced to think of themselves as a free rider.

Lastly, there are actually some people who do not mind paying their taxes. Heck, I am one of those people; I think it is my duty as a citizen to pay my taxes, so I don't mind paying. I used to do a lot of work for cash back in the day, and I scrupulously declared all of my cash income, even though I knew it was basically untracable. It was because I didn't want to shirk my duty and deprive the government of needed funds. So a tax cut proposal doesn't always resonate with people like me. So long as I don't feel oppressed by my tax burden, a tax cut proposal seldom motivates me to vote for anyone. There probably aren't too many people who feel this way, though.

Posted by: Joe Schmoe at January 6, 2004 11:06 AM | PERMALINK

About the plan being revenue neutral: Note that this just applies to the changes proposed yesterday. His earlier proposal to roll back the Bush tax cuts on people making over $200,000 a year is not included; that generates revenue for other purposes, including both new spending and deficit reduction. Personally, I think that the tactic of separating the issue of more progressive taxation from revenue hikes is a very good one.

Posted by: Hilary at January 6, 2004 11:07 AM | PERMALINK

four legs good writes: Not everyone can have kids... why should I pay higher taxes because I can't?

By "can't" do you mean "biologically unable"? If so, there happen to be around 100 million or so(probably more) parentless children in the world. I'm not saying that everyone has to have children, but there is no reason to let medical problems get in your way.

Yes, I know that everyone thinks that home-made is best, but my wife and I are very happy with our four.

But I sort-of agree with your point. Given the above-mentioned 100 million, you aren't performing a service to the world to produce more babies, but I think of the child credit as rewarding people for taking care of children, rather than producing them.

Posted by: Daryl McCullough at January 6, 2004 11:09 AM | PERMALINK

I like the simplicity of this plan. It seems like a very easy sell, particularly when you can reinforce that the tax was originally passed with exactly such a distribution. (And you can point out that the capital gains tax, etc. decreases should offset the 'pain' this creates).
I like Dean, but I like this plan more.

Posted by: ScottM at January 6, 2004 11:09 AM | PERMALINK

One thing is for sure: the Democrats have totally flip-flopped on the issue of taxes. They've spent the last three years criticizing Bush's tax cut and complaining about the deficit...and now they are proposing more tax cuts!!!

Also, this does nothing to reduce the deficit, about which the Dems claimed to be so terribly concerned. The Dems are going to have a real credibility problem here.

Posted by: Joe Schmoe at January 6, 2004 11:09 AM | PERMALINK

The cap on social security contributions doesn't seem to be regressive, because benefits remain constant. The person who makes more than $87,500 gets the same social security benefit as the person who makes $43,250.

Posted by: Joe Schmoe at January 6, 2004 11:11 AM | PERMALINK

It would be nice if we could have some national dialogue on the purpose and structure of Federal income taxes. But it ain't gonna happen. For the last 25 years, the Republicans have been brainwashing American with the notion that taxes are inherently evil. The subject is no longer up for discussion.

How pervasive is this brainwashing? People who are making under $40,000 per year will gleefully take up the argument that it's just unfair to expect rich people to pay more in taxes. Downright un-American, in fact. The general ignorance of the public regarding the tax code has been exploited and enhanced with a deliberate campaign of mis-information.

The result is typified by what a low-income friend of mine said: "Why should someone making a million a year be hit with a 35% penalty?" He has no clue that someone at the million-dollar income level actually has an effective tax rate of about 12.3%. (Meanwhile, someone at his income level [$33,000] has an effective tax rate of about 15%.)

With this background, I do not believe it is possible for this country to debate taxes any more. The level of dialogue is now limited to "Taxes bad. Money good!"

Posted by: Derelict at January 6, 2004 11:14 AM | PERMALINK

joe schmoe do you under stand the term revunue neutral?
this means that the deficit won't increase one bit because of this tax cut..
it is about fairness

i think it is great plan

Posted by: smartone at January 6, 2004 11:16 AM | PERMALINK

Joe, the Democrats I've heard from have criticized tax cuts "for the wealthy," not cuts per se.

So this sounds pretty consistent to me.

Posted by: delcyphr at January 6, 2004 11:18 AM | PERMALINK
But the most important reason is that families (defined as a family of four, BTW) who earn less than $50,000 per year do receive many benefits from the federal government. They benefit from national defense, interstate highways, federal education subsidies...the list goes on and on and on.

Of course they do, but to the same level as the Bush family? Or the Rockefellers, or the Gates? A person with $100,000 in assests isn't necessarily worried about being protected from foreign forces as the person with $10,000,000 (or more) in assests banking on oil prices remaining constant. A trucking company exec benefits much more from interstate highways than a family of four. etc. Overly simplified, but that's the crux of the progressive/ flat/ regressive taxation debate, Joe. Add in the fact that the progressive nature of sales tax and payroll taxes, and those under $50,000 (under Clark's plan) still aren't getting something for nothing.

...I scrupulously declared all of my cash income, even though I knew it was basically untracable

Oh for the love of all things holy, Joe. What's next, how you volunteered time at the homeless shelter in between your 70hr workweeks and fulltime studies?

Posted by: ChrisS at January 6, 2004 11:23 AM | PERMALINK

Smartone, you are right, but it doesn't REDUCE the deficit, either.

The Dems have always been saying that we need to pay down the deficit so future generations are not burdened with it. They've also said that it hampers economic growth, leaves us at the mercy of the foreign nations who are carrying our current account deficit, etc.

But when push comes to shove, they're not actually willing to back up their pious pronouncements with any policy. Sounds like political posturing to me. Aren't the Dems willing to face up to our huge deficit? Don't they have the fortitude to make the difficult and unpopular decisions?

Posted by: Joe Schmoe at January 6, 2004 11:23 AM | PERMALINK

Joe Schmoe---

Your comments on everybody paying something to the government would have merit, except that everybody pays payroll taxes to the feds. The first great lie in the tax debate is that income tax accounts for most of a person's tax burden.

Posted by: Nate at January 6, 2004 11:24 AM | PERMALINK

I like Clark's plan too, but there's an element of unreality to it. The very rich are just not going to accept higher taxes, and the IRS in its current emasculated condition is in no position to force them to pay. In fact, the IRS primarily goes after low-income people who use the EITC these days--they know they don't have the resources to collect from the wealthy. So this plan would unfortunately lead to continued deficits.

Posted by: Rebecca Allen at January 6, 2004 11:26 AM | PERMALINK

As Max Sawicky notes, Dennis Kucinich has already come out with a progressive tax plan. Both Clark's plan and Kucinich's apparently more ambitious plan are similar to what Max has himself been proposing for years. It seems like he would be a good person to ask about these plans.

Posted by: Al-Muhajabah at January 6, 2004 11:27 AM | PERMALINK

My single friends are always writing me from their exotic vacations about how unfair their tax burden is. Course my wife and I took a three thousand dollar hit just to be married, but, well, nevermind.

Posted by: LowLife at January 6, 2004 11:34 AM | PERMALINK

In today's dollars, the very first income tax was levied only on people who earned over $60,000, with a surcharge on income over $10 million. The federal income tax was originally conceived as a tax on the well off and the wealthy, not the working class.

I'm all for progressive taxation and in fact think it should be THE domestic issue of the Dems, not piddling tax credits. Still, to compare post-WWII "mass taxation" unfavorably to pre-war "class taxation" is a little misleading. The share of federal taxation of the total of all government taxation (and even the size of government out of total GDP) has transformed to the point that the level of progressivity of a 1920's income tax just wouldn't allow the funding of everything we need. (Also note that in the 20s the kind of non-income-based regressive taxes Kevin worries about were still around in spades).

Posted by: Chris in Boston at January 6, 2004 11:39 AM | PERMALINK

Joe, there you go again, pushing generalizations where they aren't merited.

As someone noted earlier in this thread, Clark, like Dean (and, i believe others) have proposed rolling back Bush tax cuts, which itself is a deficit reduction measure.

Now, i'd like to see dems attack foolish spending - the return of excessive farm subsidies under Bush, for instance, or the wasteful rogue-state missile defense system, or various other programs - but by and large, speaking personally (so i'm not guilty of the generalization trap), overall government spending is modestly higher than it should be (but could be redirected in more productive ways); it's revenue that's all wrong.

The honest critique of Bush - which I and many others have made - is that cutting taxes while simultaneously pumping up spending creates a fiscal nightmare that will take a long time to correct.

P.S. For the sake of honesty, we should note (as Dr. Max often does) that cutting taxes while still raising spending is meaningless: what we are doing is deferring taxes, since the spending must still be paid for....

Posted by: howard at January 6, 2004 11:45 AM | PERMALINK

What?!? I've never heard the Democrats calling for cuts in spending. What I have heard is:

1. Proposals for universal health coverage.

2. Calls for increases in military spending.

3. Constant carping about the deficit.

4. Wails and moans about the fiscal "crisis" faced by state and local levels governments.

5. Calls for increases in federal education subsidies.

6. Proposals for changes in energy policy, which basically amount to increases in public transportation and government funding of alternative energy sources (actually, I think what they really want is to raise gas taxes, but no one will ever 'fess up to this...)

You are telling me that the Dems are outraged by government spending? Not in light of the above.

Now, the Dems do criticize much of the genuine waste in governemnt, and rightly so, but this is basically opportunistic. So long as every farm state has 2 senators, there will always be agricultural subsidies (BTW, you mentioned that farm subsidies recently "returned" -- but they've never actually gone away). Both parties are equally guilty of pork barrell spending, and I think it is unfair to pretend that the Democrats have a better record on this than Republicans do.

Posted by: Joe Schmoe at January 6, 2004 11:57 AM | PERMALINK

err, your slip is showing:

"Surely someone whose income has gone up from $1 million to $5 million can afford to give back a bit of that?"

Give "back"? Who are they supposed to have taken it from?

You mean "give".

Posted by: me at January 6, 2004 11:59 AM | PERMALINK

Yes families get taxed less, but families can be construed as enterprises in which the family income is split among the participants, With this model, the individual incomes are smaller and the tax rates should be lower, under a proegressive system.

And Kevin Drum is wrong about big governmnet. We will see government ocnsumption reduced from 45% of the economy to 35% of the economy under Clark, China, our main banker, will refuse to fund us without a cut in government.

It will be Kevin's favorite programs, and BirdDog's favorite big givernment programs that will be cut the most.

Posted by: Matt Young at January 6, 2004 12:33 PM | PERMALINK

Me-

People don't turn $1 million into $5 million in a vaccuum. Every wealthy person in this country who's actually self-made (not in the "I only got a million in my trust fund and that's it") has the state apparatus to thank for their wealth. The maintanence of the court system, the markets, infrastructure, etc., etc., is all thanks to the government both past and present.

The courts that allow contracts to be binding, restitutions to be paid and the protection of intellectual property among a million other things isn't something you just pay for now, like a maintanence fee, it was built over generations and is always maintained dynamically.

That shit costs a lot of money, and pretty much all of government beaurocracy, minus SS and Medicare, benefit the wealthy and the middle class to a lesser extent. From the obvious ones like the police and court systems (primarily used to protect property- an obvious benefit to the wealthy and obviously not worth as much to the poor) to the department of mining (yeah, all them bauxite permits really trickle down) this country has done nothing but facilitate commerce since its inception. It's only since the 70s that we've seriously started to regulate commerce in the interests of the public trust.

"Give back"? Hell yeah! I encourage anyone who seriously thinks "government is the problem" to move to where there is no government, or to where there is no social contract, and see how great life is.

Posted by: Tim at January 6, 2004 12:38 PM | PERMALINK

Matt Young:

Sole owner of the last remaining Palantir!

Posted by: Tim at January 6, 2004 12:38 PM | PERMALINK

I can understand having the debate about whether any progressive taxation is ever justified or ethical when we're a bunch of kids in our dorm rooms, or Rush Limbaugh playing to a crowd of morons....but I've outgrown it a bit. Anyone who needs to be convinced is not really worth a discussion.

Posted by: andrew at January 6, 2004 12:56 PM | PERMALINK

Read most of the posts.

Regarding the services that rich people get, imagine if Bill Gates and Microsoft had to pay Pinkerton to negotiate and enforce the world wide intellectual property rights? Bill would have to hire trade negotiators, police, customs officials, judges,. He would have to put each of his distributors into a contract, enforcable via private police. Bill's cost would be enormous.

Then, make large importers pay for defense of trade routes. Once large importers realize they will pay for much of that defense, they will quickly decide to take their chances with rogue nations.

Regarding the issue of whether the young should bear what burden and the old bear what burden.

Platitudes don't matter. The real issue is spreading the burden between young and old so that we quit wiping out the educated middle class kids.

Also, regarding taxing the rich. The two methods we have to shut down the big government fanatics are external bankers, and rich folks who pay for much of it. Once the rich are faced with the prospect of paying for the multitude of big government programs that everyone will be presenting to Clark, well... you can bet that much of that stuff won't get funded.

If the rich begin paying taxes again it will be for one thing, defecit reduction. Falling dollar and irresponsible spending are the two things rich folks despise. Paying back the $7 trillion in debt, and reducing the nearly $300 billion/year in average interest expenses are what get the rich excited.


Posted by: Matt Young at January 6, 2004 01:45 PM | PERMALINK

Is subsidizing children pandering or good policy? As a parent, I think it's good policy.

Seriously, the government has an interest in subsidizing children, whether through tax credits or through Head Start, because those children are future taxpayers. The better they do in life, the more taxes they will pay. There might be better ways to spend that money, though. What an interesting debate that would be.

-j

Posted by: Jay Gischer at January 6, 2004 02:04 PM | PERMALINK

I'd like to hear what the families that make over $1 million a year have to say about the plan.

Hey dad, you know all that money that grandpa gave you to get a good upbringing and a good education and a good, fruitful life? And you know all that money that he gave you to start your business and to grow your business? And, you know all that money that you made providing services for people? And all that money that you're using to raise me and sis in a good home, good education n' stuff?
Yes, son?
Well, the government wants more of it.
Dammit, son, go to your room!

Posted by: bj at January 6, 2004 02:23 PM | PERMALINK

I'm with your sister to some extent, Kevin. I don't mind paying taxes. Honest I don't. I don't mind paying property taxes that support the public schools even though I have no kids and never will have...but that's the trade off with Medicare. I help your kids get an education, your kids help cover my expenses when I'm too old to work.

That said, I do have some problem with having to be a "family" to be considered eleigible for a tax break. My mortgage payment doesn't get dropped becasue I don't have two people working to pay for it. My utilities are no cheaper per unit of usage. My property taxes aren't any less for being single.

And as for Daryl's comment -- even were I interested in having kids, whihc I'm not, or were I not pretty close to being too old to raise a child, the people in my part of the country tend to frown upon people like me "Adopting" children...although I find it ironic at best that I'd have better luck adopting them as a single woman than I would were I to try and adopt one with a theoretical partner of choice.

Posted by: Common Veil at January 6, 2004 02:26 PM | PERMALINK

Potential Unintended Consequence:

Families who start off making less than $50K a year (like, for example, mine) but, after a couple of years, a couple of certs, a couple of promotions start making more than $50K a year?

Well, they just might find themselves experiencing a moment of clarity politically.

Who do you think will look more attractive to this theoretical family?

Posted by: Jaybird at January 6, 2004 02:27 PM | PERMALINK

Superb posting by Tim above, laying out incontrovertible and underappreciated facts about how the wealthy benefits from government.

And to the guy upthread who's bummed about Clark entering late.....He has a better chance to win than the CW gives him. Even if Dean wins IA and NH, if Clark wins 3 primaries on Feb 3rd, Clark will be the new frontrunner (unless Dean wins the others by wide margins - but that won't happen). And winning 3 on the 3rd is eminently possible. Momentum is overrated. But this is off topic, sorry. P.S. - 2nd place in NH is looking more and more real for Clark - could be a big boost. He could get a way with a close 3rd.

Posted by: Hypocrisy Fumigator at January 6, 2004 02:47 PM | PERMALINK
The cap on social security contributions doesn't seem to be regressive, because benefits remain constant.

Regressive taxes are one in which a lesser proportion of income is paid by people making more money, by definition. Thus SS is regressive (I don't recall if Medicare is flat or regressive).

Families who earn less than $50,000 per year should contribute something to the federal government.

They do. They fund the SS trust fund, which is regularly raided (er, borrowed) for general purposes, they pay federal taxes on gasoline and telecommunications and other federal excise taxes.

Posted by: cmdicely at January 6, 2004 02:49 PM | PERMALINK

Well, we can mention a theoretically perfect tax in a perfect society, just for fun.

The perferct tax will tax regressively those who get income from an artificial monopoly, supported via government law and order. The remainder are taxed according to the government benefits they receive.

The example I use is the difference between Dr. Scholl who makes millions selling foam rubber and a heart surgeon in a small town who makes $250,000.

Speaking of that small town heart surgeon, have any of us considered that his salary was determined in collective bargaining with his school mates some 20 years before he started his heart surgery business? I mean, his high school friends, the plumber, engineer, and electrician entered their professions and began making money sooner, knowing that when they were 50, their heart surgeon would be there for them. Now comes along the blind progressive tax that interferes with the arrangement and decides the heart surgeon should be taxed an additional 20%. There may be fewer heart surgeries available, and the high school friends might cry foul. They did collectively bargain for the heart surgeon, after all.


Posted by: Matt Young at January 6, 2004 02:57 PM | PERMALINK

So let's see, Clark wants to cut income taxes, Dean wants to cut payroll taxes --

-- looks like tax cuts weren't such a bad idea after all! Going to be harder to criticize Bush for his cuts (tax cuts during a recession, gosh what a novel concept) when your own candidates are trying to pander to the voters.

I had no idea Karl Rove was this good!

Posted by: Steve White at January 6, 2004 03:03 PM | PERMALINK

But when push comes to shove, they're not actually willing to back up their pious pronouncements with any policy. Sounds like political posturing to me. Aren't the Dems willing to face up to our huge deficit? Don't they have the fortitude to make the difficult and unpopular decisions?

we aren't talking about the dems as a group. this is a specific tax proposal from a specific candidate. clark's tax proposal is revenue neutral, so he isn't going to address the deficit using it. that doesn't mean he doesn't have deficit reduction policy initiatives. your argument here is dishonest and lazy. all you had to do was check clark's website.

this is what we clark has to say (below) and here's the specifics of his plan..

Wes Clark has a plan to save $2.35 trillion over ten years. The plan reduces the deficit and frees up money to invest in priorities like education and health care. Under Wes Clark's plan the deficit is reduced every year. But this plan is only a down payment on the challenging goals of a balanced budget and full readiness for the retirement of the baby boomers - and further tough steps will be needed. Deficit reduction and investment in priorities are key parts of Wes Clark's plan to jumpstart the economy and create jobs, save for the future, and invest in people.
Posted by: danelectro at January 6, 2004 03:06 PM | PERMALINK

You know how I know Matt’s just funnin’ ya’ll? Because if he were serious he would take into account just how high the tax rates were when his heart surgeon made his decision. That’s right, they were higher for those making heart surgeon money back then – so the problem isn’t that a new system has interfered with his income, it is that the new system interferes with the income of the classmates. But Mr. Young isn’t so stupid as to be unaware of this, so the post is obviously a jape.

Posted by: Lori Thantos at January 6, 2004 03:08 PM | PERMALINK
Clark wants to cut income taxes

Well, no. Clark wants a revenue-neutral rearrangement of income taxes to shift the burden more to higher income taxpayers. This is not a tax cut.

Dean wants to cut payroll taxes

Offset by increasing income taxes by undoing the Bush tax cut, for an overall, IIRC, tax increase; again, not a (net) tax cut.

looks like tax cuts weren't such a bad idea after all!

Why, because both Dean and Clark are proposing net tax increases, overall?


Posted by: cmdicely at January 6, 2004 03:11 PM | PERMALINK

Howard writes, The honest critique of Bush - which I and many others have made - is that cutting taxes while simultaneously pumping up spending creates a fiscal nightmare that will take a long time to correct.

Howard, you might recall that in winter, 2000 this country slipped into a RECESSION. In a recession, the proper (Keynsian) response is to 1) push up government spending to prime the pump and 2) cut taxes to do the same. You spend money on unemployment insurance, government purchases, etc., and you cut taxes to stimulate reinvestment. Plenty of Democratic presidents have done the same.

If you DON'T cut taxes in a recession, you choke off investment and kill the recovery. That keeps unemployment, already high because of the recession, high for a long time. If you DON'T increase spending, lots of people are in misery and you don't prime the pump for the recovery.

I know you hate to admit this, but GWB and Co. simply followed the textbook: having inherited a recession, they cut taxes and they spent money. Yes the deficit bloomed, but the alternatives (unemployment of 10% or a five year recession) were much worse.

Al Gore would have done exactly the same. A President Gore would have cut taxes to about the same extent, and especially after 9/11 would have increased spending. Only you wouldn't be complaining on Calpundit about that.

Posted by: Steve White at January 6, 2004 03:13 PM | PERMALINK

Ah, the parade of joke posts never stops does it? Now we have Mr. White pretending that cutting taxes on people who work for a living is the same as giving those hard earned dollars (through raiding of the Social Security Trust Fund) to multi-millionaires. Side splitting in its own way. Or, perhaps I should say, budget busting. Steve, here’s a small difference, if you give money to people who will then invest it in foreign currency trades you are simply subsidizing gambling with no productive economic impact. If you give it to people who work for a living, they will consume and create increased demand. That’s why arbitrary tax-cuts for the wealthy are stupid, and limited tax cuts for those who actually need the money combined with offsets from those who have been “borrowing” from the working class for decades (ever since Reagan’s massive tax increases on the working class) make sense. But you too know that and are, I assume, merely posting for humorous effect.

Posted by: Lori Thantos at January 6, 2004 03:17 PM | PERMALINK

Mr. White, you might recall that in winter 2000 there was, in fact, no recession. That didn’t happen until AFTER Bush took office. Jokes are one thing, but passing off as fact items that verifiably untrue is just dishonest. But the rest of your joke seems to still be playing out – that cutting taxes on the wealthy is a stimulus for something other than the wealthy. See, in case you are serious, you have no demonstrated success with your apparent notion that supply side economics works. You certainly can’t point to the success of Reagan’s tax cuts since he spent more time (and collected more money) increasing taxes than cutting them.

“Al Gore would have done exactly the same” is, once again, demonstrably untrue. There is no evidence that Gore would have pandered to the wealthy and helped usher in a profoundly unbalanced and destructive “recovery.” Instead, he would have continued the Clinton policies that worked – helping those in the lower and middle classes who actually create the jobs and are the backbone of the economy. Your joke that all tax cuts are exactly the same is wearing thin.

Posted by: Lori Thantos at January 6, 2004 03:24 PM | PERMALINK

Steve, just to pick up on this matter, i could, of course, have phrased my initial posting more elegantly, by noting that permanent reductions in tax rates accompanied by increases (largely permanent) in spending is a fiscal nightmare and pre-empted your response.

And obviously that is where Al Gore comes in. He too would have faced a recession, but his approach to a recession would have been to create a true short-term stimulus package that probably would have incorporated some form of payroll tax holiday, some form of counter-cyclical but temporary state revenue sharing, and some form of public works, about which more in a moment.

In addition, had president al gore seen 9/11 on his watch, he would not at one and the same time have amped up defense spending, continued to cut taxes, and continued to allow discretionary spending (targeted increasingly at republican congressional districts) to grow rapidly. This is true LBJ territory here that Bush has entered and that Gore would not have entered.

as for public works, a president al gore would almost certainly be following the hart-rudman commission recommendations for hardening targets and improving first responder training and capability, thereby not only providing public works but also enhancing homeland security.

but i digress; the point is we're all keynesians now, we get fiscal stimulus, but bush didn't create fiscal stimulus, steve, he created structural deficits, quite a different matter.

joe, you didn't read me carefully enough. I didn't say that the Dems are "better" on spending than the GOP. Spending discipline begins in the White House; Bill Clinton had it, George Bush doesn't are true statements. But they say nothing about the parties as such, and i didn't either.

Posted by: howard at January 6, 2004 03:40 PM | PERMALINK

Tim,

Where are these places where you claim there is no government? I would like to check them out, but I know of none. Perhaps you meant small government, for a society with no government would have a hard time making laws that allow society to function and being able to enforce those laws. You would probably have anarchy, which some have argued would work, though I don't see how.

The choice to me seems to be between small government, where the government's job is minimal and confined to the bearest neccesities ,such as, the kind defined by our Constitution, or large government, which is basically involved in every aspect of our lives. The reason I say the choice is between big and small is because there is no middle ground, once you allow government to step over the line and involve itself in the decisions of individuals lives, which can only be done by an eroding of their rights, it will inevitably become involved in every aspect.

The U.S. was set up by the Constitution to be a small government whose job was simply to protect the society and enforce the laws that protect individual rights equally. What an individual chooses to do with these rights is strictly his responsibility. Everyone should have to pay an equal amount for the administrative cost of government for this protection. If I make more out of my equal opportunity than the next guy, in an honest and legal fashion, then I deserve it. If I choose to be charitable and give my money to others, I'm free to do just that. It's not government's job to force charity, it's not it's job to take care of my health, it's not it's job to take care of my retirement or take care of me when I'm old, It's not governments job to support me if I don't work or even can't work, it's not governments job to take care of my kids, it's not governments job to educate any citizens. All of these responsibilities are up to us as individuals in a truly free society, which is what this country was meant to be, but obviously no longer is. It's what made this country the greatest producer of wealth and knowledge. A person does not get wealthy at another persons expense, they create wealth by producing something of value that others seek and are willing to pay them or trade them for. perhaps they are using resources from their own private property or perhaps they are buying resources from others and using their skill to turn it into something of value. It is not a zero-sum game.

Big government is corruption, whether through criminal intent or even "good" intent. It's thousands of rules and regulations to fix thousands of previous rules and regulations. It's all about which individual, or special interest group, or greedy business can buy some politicians and influence legislation to get rules or regulations passed in their favor at the expense of others. With big government you get everybody involved in everybody elses lives, so now we all think we have a say in how someone else should live, we think it's our right. No more McDonalds for you, afterall, we all have to pay for medicare and you're getting too fat.

I don't want to be pooled with all of you. I don't even like many of you, and I'm sure that you don't like me. I'll take care of myself and those I choose to. I'm not asking you for anything. Those of you who want to live as socialist are free to do so. Form you own little group an take care of everybody who wants to be a part, but why do you have to force everyone to join? Why do you have to take the one truly free country and destroy it?

To quote the band Ten Years After:

Tax the rich; feed the poor
til' there are no rich no more.

I bet you think that's a good thing.

Posted by: opstock at January 6, 2004 03:45 PM | PERMALINK

I haven't read all the comments, but I think Clark's plan is brilliant. It's simple and fair. Sorta one of those things that you wonder why the hell can't politicians just do that sort of thing?
Eliminating income taxes for all under $50k - brilliant.
Reducing for 50k-100k, also brilliant.
To pay for it, hit income over $1mil, with a 5% increase, which doesn't sound like much.
Damn, this guy may be good.

Posted by: rhinoman at January 6, 2004 03:59 PM | PERMALINK

opstock, you make the same mistake that mindless libertarians always do – you assume that the government had no hand in your success. When one digs deeper one never finds a libertarian who was born in a log cabin they built with their own hands on property unimproved by government efforts, whose connection to the internet is done via stacks created on their behalf without regard to the government investment in software and on proprietary lines either rented or purchased without any government assistance. You live in a fantasy world where you are self-sufficient. The rest of us live in the real world where no individual is, and where those who attempt to be don’t spend time taking advantage of government programs like the Internet.

Posted by: Lori Thantos at January 6, 2004 04:02 PM | PERMALINK

Tim, Lori, I do not entirely agree.

You are right that our system of laws, etc. makes it possible for people to accumulate wealth. But I am not so sure that I buy the idea that people who have more wealth should therefore pay more in taxes, because they get more protection.

For one thing, this argument is obvioulsy not applicable to things like the protection of one's life. The life of a rich person is worth no more than the life of a poor person, and to the extent that the police and fire departments prevent people from being murdered or burned to death, all of us benefit equally.

And it's not just limited to the protection of life. There are rich people who walk to work, and "poor" people who drive 70 miles per day. The rich person hardly benefits at all from the network of roads, while the poor person benefits tremendously. Under your theory, though, the rich person would pay for the road use of the poor person.

But you are also ignoring something of crucial importance. The rich don't owe society for their wealth: they create their own society. One of the reasons why crime is low in upper-middle-class neighborhoods is becuase the rich spend a lot of money to live far from criminals. Also, people who live in nice neighborhoods do not tolerate things like public drunkeness, crack houses, and prostitution. And no, this isn't just the result of police protection. During the Rodney King riots here in LA, my friend used his shotgun to protect his neighborhood. Many, many rich people would do likewise.

The same is true in the business world. Rich people take risks and start businesses. They get good educations and good jobs. They work hard and innovate. Yes, society may be partly responsible for the network of laws, etc. which protect private property, but rich people *take advantage of these things* while many others do not. Society doesn't just confer wealth upon rich people; rich people seek it out.

Lastly, on a historical note, I always find the notion that government regulation was responsible for the growth of the Old West absolutely ludicrous. The settlers were successful becuase they bravely struck out for a new land and literally created something out of nothing. They faced freezing winters, raiding Indians, disease, blight...the Homestead Act wasn't much comfort in these circumstances. Many western towns had no protection from a sheriff or the army; the townspeople were repsonsible for their own security. And let's suppose there had been no Homestead Act. Do you really think that those hardly settlers would have allowed anyone to cheat them out of their land? There is no way in hell. The settlers would have gotten title to their land one way or another. If there hadn't been a Homestead Act initially, the settlers would ensured that one was passed later. Anyone who suggests that they took advantage of a form of government welfare disgraces their memory. Sorry, but this is a sensitive subject for me.

Posted by: Joe Schmoe at January 6, 2004 04:23 PM | PERMALINK

Environmentalists are proposing a "tax shift" to redirect the incentives in the tax code. The goal, as The Ecology of Commerce author Paul Hawken puts it, is to give people and companies positive incentives to avoid taxation. The green economists would purge the tax code of regulations and loopholes that clearly encourage environmental degradation, such as the $17 billion cost of tax-free parking. New levies would be applied on pollution-generators like products containing lead, gas-guzzling cars, ozone-depleting chemicals and the burning of fossil fuels. Taxes would be judged on their real contribution to the economy, in terms of job creation and productivity growth, equity for the people paying them, and resource conservation.

New and progressively-graduated taxes could shift 10 percent of the federal tax burden in the next 10 to 20 years. As defined by Alan Thein Durning and Yoram Bauman in their book Tax Shift, and by Redefining Progress in Tax Waste, Not Work, the levies could include:

1. Carbon taxes to decrease the generation of greenhouse gases threatening worldwide climatic change. Governments could impose a tax--say, $50 per ton of carbon emissions--or combine a smaller tax with user fees or revenues from the sale of pollution permits;

2. Pollution taxes to reduce the contaminants flowing into our rivers and streams, filling our landfills and eroding the quality of our soil. There are an estimated 250 human-made chemicals harbored in the living tissue of the average American;

3. Point source taxes to reduce pollutants pouring forth from the outflow pipes and smokestacks of sewage treatment plants, factories and incinerators;

4. Traffic taxes in the form of tolls imposed strictly during rush-hour congestion periods, could promote the use of carpools and mass-transit, as well as flextime work hours;

5. Higher use fees for resources owned by the public, such as grazing or mining that occurs on public lands.

A danger here is not to lose the progressive nature of taxes. Some countries handle this by not taxing a certain standard amount of water use, but then graduating that resource tax as use goes beyond the tax-free threshold.

This would not discriminate against the poor, though how to do this in terms of higher taxes on gasoline, and the poor who need to drive, without a corresponding increase in non-driving options, is unclear.

Posted by: freelixir at January 6, 2004 04:31 PM | PERMALINK
The same is true in the business world. Rich people take risks and start businesses. They get good educations and good jobs. They work hard and innovate. Yes, society may be partly responsible for the network of laws, etc. which protect private property, but rich people *take advantage of these things* while many others do not.

Often, being rich is a big bonus, if not an actual prerequisite, for taking advantage of these things effectively.

And let's suppose there had been no Homestead Act. Do you really think that those hardly settlers would have allowed anyone to cheat them out of their land?

No, because they wouldn't have been there in many cases. The Homestead Act was passed -- and was rather successful -- to encourage people to settle in the west, by providing, from what was notionally the common store (although, in many cases, the native populations might disagree about whose public property it was), an incentive for settlement.

Posted by: cmdicely at January 6, 2004 04:33 PM | PERMALINK
During the Rodney King riots here in LA, my friend used his shotgun to protect his neighborhood. Many, many rich people would do likewise.

During the Rodney King riots, many people in poor neighborhoods did likewise. What's your point?

Posted by: cmdicely at January 6, 2004 04:36 PM | PERMALINK
If you DON'T cut taxes in a recession, you choke off investment and kill the recovery.

In a recession featuring over-capacity, you need to stimulate consumer demand, not investment. So, even if you do want to cut taxes, you want to do it with a very different distribution than the Bush tax cut.

Posted by: cmdicely at January 6, 2004 04:39 PM | PERMALINK

Steve White mentions:

Keynsian "policy"
1) push up government spending to prime the pump and 2) cut taxes to do the same.
--------------------

Actually, the basic idea is that during a recession in the private sector, resources are cheaper and that is a good time for government to work on its infrastructure. This is not a brilliant flash, it is an understanding of common sense in economics.

But, the debt is supposed to be paid back unless there is some motive for delaying the payback. We now have about $5 trillion of debt from 16 years of Reagan big government, it was never paid back.

Interesting enough, the idea of big government spending is a basic Republican idea. The Dems got misdirected , and deceived under LBJ and are still trying to return to their roots in small government and preogressive taxation. We still have to re-educate Kevin Drum however.

Another misperception:

" If you DON'T cut taxes in a recession, you choke off investment and kill the recovery."

Cutting taxes has very little effect in a recession economy for the simple reason that government takes resources (or gives them back) to the private sector when government increases or decreases. It matters little whether the resources are paid for with debt or taxes, the missing resources still come from the hides of the working private sector.

The main key here folks is to watch the relative size of government in good times and bad. Make sure your don't let it get out of hand that you kill off the population, which government often do. In a recession, the population delays its activities, their taxes naturally reduce, and that is the safe period in which government can step in and get its share of the pie. When the population retools and resumes its economic activity, (by surviving and preserving civilixzation perhaps?) then cut back on government and give back the resources.

The main reason we tax the rich is 1) Some have an artificial monopoly and 2) When rich people get taxed heavily than they pay attention and force sensible government.

Posted by: Matt Young at January 6, 2004 04:48 PM | PERMALINK

Common Veil,

A good number of the adoptive parents that we know are lesbian couples. I don't know any gay male adoptive parents, for some reason.

--
Daryl McCullough

Posted by: Daryl McCullough at January 6, 2004 05:13 PM | PERMALINK

Lori,

Do you get the internet for free? Last time I looked at my bill I was paying a private company for my internet access.

Individuals invented the technology for the internet, not the government.

Just because the government has seen fit to take taxpayers money and involve themselves in business does not mean we need them to. In fact, I'm sure that the amount that they spent was a thousand times more than purely private investment would have needed to spend to create the internet.

In case you didn't know, the U.S.government is suppose to be an aparatus by which we self-govern; period. It's not a business. It produces nothing. It's not suppose to take my money to invest it in business, that's my right and my decision what I want to invest my money in.
It took money from me and you and everybody who pays taxes to build what you say it built for the internet. I owe it nothing. And like I said, does anyone doubt it took way more money than a strictly private business venture would have spent.

Where did you learn your history? It must of been in government schools. You actually believe that we need the government to improve the land in order for us to build on it. When has this ever been the governments job.

If you say that they build and maintain highways and other projects in order to facilitate the neccesary interaction for free trade, I agree they have and they still do, and we pay taxes to pay for that, though I still say private enterprise could do it cheaper. Either way, private enterprise could certainly do it, heck they do a lot if it now, only we have to pay the government with all it's bureaucracy, to be the middleman. We don't need that.

I will ignore your assertion that I'm a mindless fantasizer, and refrain from any useless name-calling. At least this time. lol!

Posted by: opstock at January 6, 2004 05:17 PM | PERMALINK

opstock,

If you really are interested, Somalia is a current example of a country with no government.

From: http://www.immigration-usa.com/wfb/somalia_government.html

Somalia has no functioning government; the United Somali Congress (USC) ousted the regime of Maj. Gen. Mohamed SIAD Barre on 27 January 1991; the present political situation is one of anarchy, marked by inter-clan fighting and random banditry

People's Assembly (Golaha Shacbiga):
not functioning

Judicial branch:

Supreme Court (not functioning)

Posted by: Yukoner at January 6, 2004 05:22 PM | PERMALINK

Joe Schmoe,

I think you have a completely incorrect view of the origin of wealth. The settlers to the old west could not have survived without federal troops protecting them (from the actual owners, the Indians, to be specific). If the government had not been committed to building and maintaining railroads, and later, superhighways, much of the west would be unliveable today.

You write: But you are also ignoring something of crucial importance. The rich don't owe society for their wealth: they create their own society.

I think that's completely wrong. Tremendous wealth is only possible because of society, in particular, because of government. Without government, the only wealth a person could have would be whatever he could carry (or hide, as in buried treasure).

Posted by: Daryl McCullough at January 6, 2004 05:26 PM | PERMALINK

opstock,

I think you're completely off the mark here. Wealth is really only possible with government enforcement of property rights.

Of course, if you are rich enough, you can hire your own henchmen to protect you and your property rights. But in essence, people that rich create their own government, except based on property rights, rather than democracy. That's basically monarchy---what is a king, other than the legal owner of the entire country?

Posted by: Daryl McCullough at January 6, 2004 05:31 PM | PERMALINK

"[...]And let's suppose there had been no Homestead Act. Do you really think that those hardly settlers would have allowed anyone to cheat them out of their land? There is no way in hell. The settlers would have gotten title to their land one way or another. If there hadn't been a Homestead Act initially, the settlers would ensured that one was passed later. Anyone who suggests that they took advantage of a form of government welfare disgraces their memory. Sorry, but this is a sensitive subject for me."

Well, look at Latino-America, they had no "Homestead Act" (or the properly state enforced act), so most people have no land, and a few have very big properties...

DSW

Posted by: Antoni Jaume at January 6, 2004 05:31 PM | PERMALINK

"Of course, if you are rich enough, you can hire your own henchmen to protect you and your property rights. But in essence, people that rich create their own government, except based on property rights, rather than democracy. That's basically monarchy---what is a king, other than the legal owner of the entire country?"

And we all know about that 1776 business.

DSW

Posted by: Antoni Jaume at January 6, 2004 05:37 PM | PERMALINK

I wish the single and childless could get what they want as well (I will divulge that I have children, but they are now above the age limit, so I do not benefit from this plan). But here's the deal, folks: tax policy is not about what I, me, or mine "deserve" on a dollar-earned basis. It's not about your keeping your hard-earned salary. That is a Republican notion. Good tax policy, as I believe this is, is about what is best for the nation and has to be based on certain notions of the common good, and on societal issues the government feels are worth promoting. What is important about Clark's tax policy is the ideological context in which he proposed it (for which you can read his speech at his web site). We need to make some choices that will be good for the country in the long term. This is not about an election year bribe to voters: it's a long-range vision for what will make a better America tomorrow.

The fact remains that single people and couples without children, although certainly squeezed in many ways I myself appreciate, do not face financial and other stressors that this economy has placed on people with children. First and foremost, people without children do not have to pay for child care in order to get to their jobs ($100 to $200 per week). Nor do they have the expense for food, clothing, books and other materials necessary for raising the next generation of citizens--citizens who will provide the services you need in your dotage, including policing your streets, finding cures for your illnesses, producing the art that sustains you, etc.. We don't want a generation of poorly fed and nurtured kids running the place in 20 years. We want children ready to do well in school so they can contribute down the line to the country.

Finally, and this was a point for Clark: in order to pay for the basics for feeding, clothing, and educating children in today's workforce, both parents must be working and some must work two or three jobs. They are spending less time with their children by necessity--22 hours less per week. And that is not good for our society. Less time for parents to assist with homework, to read to children, to monitor their activities, etc. It's a huge stress on families. Helping them with this small amount will alleviate a portion of that burden.

The only thing I'd change here is that "children" should be replaced with "dependents," since some childless singles and couples do take care of elderly parents. The plan does, btw, provide for single heads of household with children.

Posted by: samela at January 6, 2004 06:05 PM | PERMALINK

I admire Dean's general refusal to trim or pander in the face of attacks. But if he is subject to Lieberman's and Kerry's demagoguery on middle class tax cuts, he will be doubly so to Bush's, and I think it could be a vulnerability. Dean is right about the ways other Bush policies take out more from pockets than the tax cut put in. Why not repeal of Bush with some relief for the middle class, with perhaps an extra 1% at the highest marginal rate to make it all come out?

Posted by: BobNJ at January 6, 2004 06:11 PM | PERMALINK

The old Somolia government example comes up often.

Yes, when government is too small one gets an oligarchy, and Somalia is an African example of Oligarchy.

The small government that most concerns me is China. China, as you should all realize, has dollarized their economy and essentially acts as the 51st state of the United States, except they get a 45% tax cut and have 150 million surplus workers. The tax cut results because they have 45% less direct government, but astoundingly, they get all the benefits of the U.S. military protecting their trade and oil routes.

But, back to their small government. When the U.S. grows its government too large, China must move more of its surplus workers to its factories to make up our lost private sector economy that our own government has absorbed. So it is China that maintains the balance between government and private sector for us, U.S. voters being incapable of the task ourselves

China's problem is the increased demand for goods from Europe may force them to move workers into production at a faster rate than the current surplus capital can support. If this occurs, they must either continue to shrink government, threatening oligarchy rule; or, just as bad, de-couple from the U.S. economy forcing a very rapid rise in both interest rates and prices.

The problem is actually worse because Asia is wed to China as their principle suppliers, and most of Asia is dollarizing their economies. Any overgrown governmnet we put in place is compensated for by Asian adjustments in their manufacturing system. It is necessarily bad for China because we have fewer and fewer educated middle class kids available to pay back the debt, and Asia ramps up for increased manufacturing which has to go somewhere.

Posted by: Matt Young at January 6, 2004 06:12 PM | PERMALINK

Daryl-

In many, if not most cases, the army provided little or no protection to settlers. The west is huge and the forts were few and far between. If you live 200 miles from the nearest army post, well, the cavalry isn't going to be much help when a raiding Indian war party decides to pay a visit to your farm.

America is littered with the bodies of hundreds of thousands of settlers who were killed by Indians. The idea that the Old West was some kind of well-regulated government plantation defies belief.

What the settlers did was pack up their belongings into ox-drawn carts and strike off accross a train into an untamed wilderness. If you wanted to eat, you grew your own food or starved to death. There was no AFDC back then, and the government did not send surplus USDA cheese to the settlers. If you were attacked by a bear or a mountain lion, you shot it or died. There was no Animal Control officer there with a tranquilzer dart to protect you. If the Indians carried off your wife and children (they did do this, you know), you hunted them down and killed them or your loved ones would be raped and/or tortured and/or murdered and/or enslaved. Maybe the army would rescue them, or maybe by the time they got word (remember, the army post might be 50 miles away -- and there were no telephones), your loved ones would already be dead. If you caught penumonia or broke your leg in a fall, you got well on your own or died. There was no Medicaid back then.

In light of the above, I do not think it is fair to describe the Old West as some sort of government social engineering project. The people who settled the west did so because they had courage and daring and took enormous risks. The government deserves precious little credit for this. It deserves some, that is true, but hardly the majority. The idea that the government was primarily responsible for westward expansion is ludicrious.

Posted by: Joe Schmoe at January 6, 2004 06:16 PM | PERMALINK

I have just changed my mind about this. At first, I thought it was basically a good idea, just in need of a little tinkering, but now I am opposed to Clark's plan.

The argument that this will "restore" progressivity to the tax system is bogus. We already have a progressive tax system!

See the chart here:

http://www.enterprisefunds.com/tax_center/tax_bracket.html

Under the present system, which supposedly is so grossly unfair, a family which earns from $56,801 to $114,640 per year is taxed at the 25% marginal rate.

$114,640 per year! A "middle class" family can make up to $114,640 per year! Families earning less than $56k are taxed at a 15% rate, while those which earn less than $14k are taxed at a 10% rate (and I suspect that most of these people effectively pay no taxes, as they must be eligible for the EIC.)

There are THREE HIGHER TAX BRACKETS; one for familes which earn betweeen $114 and $174k (28%), one for families earning between $174 and $311k (33%), and one for families earning in excess of $311k.

How much more progressive can the system get????? How much is enough? Why aren't you people satisfied with the way things are at present?

The hard numbers clearly show that the rich already pay more in taxes than we do. Why do you want to raise them even more?

My God, isn't this really about soaking the rich? Why is a "middle class" family (which can make up to $100,000 PER YEAR under the Clark plan) so desperately in need of tax relief? And yes, I know that $100,000 isn't that much in a major city -- hey, I live in LA -- but it's still PRETTY DARN GOOD.

The scales have just fallen from my eyes. This really is about soaking the rich. It's socialism! People who earn $100,000 per year aren't in desperate need of tax relief. The rich already pay more than they do in taxes. This proposal is terible. The tax system is already progressive. What is so terribly wrong with it?

Posted by: Joe Schmoe at January 6, 2004 06:28 PM | PERMALINK

Note that under the current system, a married couple with no kids that makes up to $114,000 per year is taxed at the "middle class" rate! Oh, the horror!

Posted by: Joe Schmoe at January 6, 2004 06:30 PM | PERMALINK

"If the Indians carried off your wife and children (they did do this, you know), you hunted them down and killed them or your loved ones would be raped and/or tortured and/or murdered and/or enslaved. "

Indians, eh? I think it was a wee bit more common the other way around..

Actually, as for torture and enslavement, I think it was more than a wee bit more common the other way around.

Not sure your heroic settler history even survives the laugh test.

Posted by: sean at January 6, 2004 06:38 PM | PERMALINK

Yeah, right, Sean. Those Puritans and German farmers were bloodthirsty savages bent on couting coup, raping and murdering Indian women, and enslaving Indians.

The Apache were peace-loving agrarian farmers who just wanted to commune with nature and enjoy religious freedom. I suspect that I am the only one here who as actually read any history of the Old West.

Posted by: Joe Schmoe at January 6, 2004 06:41 PM | PERMALINK

"America is littered with the bodies of hundreds of thousands of settlers who were killed by Indians....Maybe the army would rescue them, or maybe by the time they got word (remember, the army post might be 50 miles away -- and there were no telephones), your loved ones would already be dead."

-hundreds of thousands? ahahaha....but anyway that sounds like an argument for a bigger, better government-provided army to me.

Posted by: sean at January 6, 2004 06:42 PM | PERMALINK

It's always fun to some in after 75 comments, and wonder how taxes morphed into Indians. The human minds at work.

Posted by: lk at January 6, 2004 06:51 PM | PERMALINK

Joe Schmoe,

I think you're completely wrong about that. The settling of the west by white people was only possible by getting rid of Indian claims on the land, which was accomplished by forcible removal or by extermination.

I don't dispute your point that the settlers were brave and resourceful. But so were the Indians who were there before them. What made the difference was military power (and the fact that the Indian population had already been decimated by the diseases brought by Europeans).

Posted by: Daryl McCullough at January 6, 2004 07:14 PM | PERMALINK

Joe asks: How much more progressive can the system get?

Well, that's a pretty easily answered question. The tax system has been more progressive pretty much throughout the last half of the twentieth century.

Posted by: Daryl McCullough at January 6, 2004 07:19 PM | PERMALINK

"The scales have just fallen from my eyes. This really is about soaking the rich. It's socialism!"

The Bush administration increased my taxes. They bust the Federal budget on massive giveaways then starve the states with unfunded mandates. The states starve to the local governments and all the extra costs gets passed on to me. Instead of seeing at least some slowdowns in the rate of property taxes, health care, and education increases, they keep ramping up and up like the recession never happened.

So when I want a tax break, I run the risk of being called a socialist by the very same people that had no problem giving REAL tax breaks to billionares. The Bush administration needs to keep their hands out of my pocketbook. Quit taking my hard earned money and giving it to someone else who does not even need it. I was raised to respect and keep track of my money. Some call that socialism, I call it good American values.

Posted by: rolodomo at January 6, 2004 07:32 PM | PERMALINK

Antoni,

We are not a democracy. We are a representative republic. In fact, while it was difficult for the Constitutional delegates to agree on everything in the Constitution, which is understandable, the one thing they all agreed upon was that we should never be a democracy. At least by what the definition of democracy was at that time, which was nothing more than gang rule by the majority. We use the word today as a synonym for a free society, but that would depend on your definition of freedom. For example, a Socialist country is also a democratic country, but that's not my definition of freedom, nor was it our founding father's.

Sean,

We didn't do anything to the Indians that most of the Tribes hadn't done to each other. They constantly attacked each other for land, and often took prisoners and forced them into slavery. Read the true history of native americans and you'll see they were just as imperfect as anyone else. They're responsible for the slaughter of millions of indigenous animals as well as each other.

As for the need for a government militia, one of the directives set forth by the Constitution is for the federal goverment to protect us from foreign invasion, not to protect us from ourselves.

Posted by: opstock at January 6, 2004 08:09 PM | PERMALINK

I'm a 24-year-old single man. I make less than $26k a year. About 20% of my paycheck goes to federal taxes (income tax, FICA, and Medicare). That's enough to make a real difference in my standard of living. My employer pays at least another $2k a year or so in taxes on my behalf (FICA employer portion), which therefore comes out of my paycheck even though it doesn't show up on my pay stub. (All reputable economists agree that the 'employer portion' is merely an accounting fiction; payroll money all comes out of the same pool.) I have no children, and won't until I achieve financial security. It would be irresponsible to have children that I could not properly support. Yet, apparently, according to the breeder mentality of our politicians, I don't deserve any tax break.

Clark's plan has nothing to offer me.

Posted by: Firebug at January 6, 2004 08:55 PM | PERMALINK

I would bet that if Kevin took me to dinner every night and I insisted that he always pay for it because he made more money than I did, I would soon hear him ask me if what was going on was fair.

Surely someone whose income has gone up from $1 million to $5 million can afford to give back a bit of that?

"Give back"? Cutting someone's tax cut doesn't "give" them anything back. They are getting to keep what was already theirs. Some people regard your money as the government's so when the government "gives" it back to you by reducing your tax rate you should be puckering up and giving them a big wet one. You can. I won't.

And the super rich were not the only ones to have seen their pay increase. In the past 20 years, my pay increased 4x. I am hardly among the super rich. Class warfare is alive and kicking. The Clark plan is just another battle in the war. The weathiest 1% among us, a term Al Gore must have whiningly said 5 million times, pay the bulk of income taxes now. The 'innovative' Clark plan will force them to pay it all. Pandering politics at its best. Divisive and unfair. That doesn't matter though does it? Liberals mindlessly lap up class warfare crap like this.

Posted by: Dennis Slater at January 6, 2004 09:05 PM | PERMALINK

Good for Clark for proposing an easily understood and broadly acceptable proposal for revamping the tax structure. Campaigns are supposed to float new ideas, and this one does seem to stimulate some thought.

Posted by: bad Jim at January 6, 2004 09:06 PM | PERMALINK

What a ludicrous dodge; sure, individuals, paid by the government, created the Internet, but separating those who are paid by the government from the government means that none of the things you object to are part of the government either. As to the silliness of pointing out that you pay a private company for Internet access – so what, did that company create the Internet? Did that company design the IP stack you use? Did you? These things were created by the government and are essentially free because of that. In other words, your fantasy (by the way, I compared you to the mindless fabulists, the libertarians, I didn’t “call” you one) that “[the government] produces nothing” is quite obviously false both from my example and from yours. That you then turn around and claim that “I'm sure that the amount that they spent was a thousand times more than purely private investment would have needed to spend to create the internet” demonstrates the problem with those who do identify as libertarian – this certainty without feeling the need to back up one’s assertions.

Actually, you are probably right that the government spent more money developing the Internet than a private company would have – but only in the sense that a private company setting out to create the Internet would only have done so if that goal was already in mind. Without the idea of the Internet, no private company would nor (and this part is important) did do so. You can’t compare results based research with basic research. The government does plenty of the latter and thereby acts as a de facto subsidy on the former. Without such subsidies the products you enjoy (like the computer, the Internet, and everything else based on the transistor) would either not exist, would have taken much longer to develop, or would be prohibitively expensive. Here, by the way, I can use history as a guide; look at how much basic research was funded by the government and how that government sponsorship has ensured that anyone with a good idea on how to use that research can then spend far less doing goal based research and create products.

While I’m sure the residents of your street would be just as happy to pay on a regular basis for paving the streets that they drive, and I’m sure there are no difficulties inherent in a system where every road is paid for with private monies and there is no chance that such a system would unduly burden those whose ancestors weren’t lucky enough to have more than their neighbors, I’m not quite sure that everyone believes that. Nor am I certain that, given that lack of belief in a magical market where fraud, deception, abuse, and the other distorting factors are non-existent (just working from my poor government schooling, there don’t seem to be any examples where this market existed), it would be a good idea to base an actual society on such an untried ivory tower ideology.

(By the way, you misunderstood my point about government improvements – I didn’t say they were required for building; I’m saying that you take advantage of them all the time. I seriously doubt you live anywhere such that this is not the case, especially if you are using the government created Internet).

Posted by: Lori Thantos at January 6, 2004 09:11 PM | PERMALINK

I've read that our beloved Hollywood Liberals are unique as a class for failing to resent paying fat taxes on their fat earnings, reportedly because they alone among our big winners feel that their outsized rewards are to a substantial degree due to luck - the right genetic inheritance, the right family, being in the right place at the right time, and the kindness of strangers (for which read the dedicated work of colleagues).

Posted by: bad Jim at January 6, 2004 09:13 PM | PERMALINK

Firebug,

The bad news is that the costs you have listed are only half the costs. The costs you do not see are the missing jobs that move overseas because the cost of government makes them unprofitable. These missing jobs would have raised your salary and reduced your cost of living.

Each time an employer takes on a new employee and his family, the employer also must take on an employee and family that lives on the government economy. This is the effect of having a government that consumes nearly half the economy.

Now, many advocates of government programs seem to think that more government programs are simple accounting tricks which have no real hidden costs. We can now prove this isn't so, and in fact, too much overnment easily kills of the host.

Posted by: Matt Young at January 6, 2004 09:19 PM | PERMALINK

If the time is right for the U.S. to transition to national health insurance, and there is some evidence that it might be, it would be really nice if one of the canditates were to float a proposal along those lines.

For those of you who (a) pay for their own health insurance and (b) have had occasion to experience, directly or vicariously, health care in Europe, Australia or Canada, would you mind paying less for the sort of care you've experienced? Bear in mind that this would also tend to reduce product liability costs and vitiate the tort reform issue.

Taxes might be a less contentious issue if their benefits were more immediately and routinely visible.

Posted by: bad Jim at January 6, 2004 09:22 PM | PERMALINK

Young Matt, shouldn't China and India have rapidly declining populations?

Posted by: bad Jim at January 6, 2004 09:23 PM | PERMALINK

Once again we are drawn into the fantasy world of “conservatives,” where the creation of wealth by the wealthy is done without regard to the government. In the real world there is no wealth without property rights. In the real world, those with the most wealth benefit the most from government both in terms of welfare (class warfare crap that Republicans eat up when Corporate Welfare means more money in their pockets) and in terms of services (how many of you here making less than $300k/yr derive any benefit from the ExIm Bank? How many seriously benefit from the workings of the SEC?). Yes Dennis, give back. One other thing to note, the wealthy have been getting by paying less than their fair share for decades, borrowing from the working class (raiding their pensions in the form of Social Security) in order to finance their tax cuts that have made the effective taxation almost flat which punishes those who have the least the most.

Posted by: Lori Thantos at January 6, 2004 09:23 PM | PERMALINK

Regarding the services that rich people get, imagine if Bill Gates and Microsoft had to pay Pinkerton to negotiate and enforce the world wide intellectual property rights? Bill would have to hire trade negotiators, police, customs officials, judges,. He would have to put each of his distributors into a contract, enforcable via private police. Bill's cost would be enormous.

When I read something like this my teeth start grinding. It is not Bill Gate's cost that would be impacted, but the consumers of software from developers everywhere. Enforcement of intellectual property rights most certainly benefits the entire industry and consumers not just Bill Gates or even just Microsoft and it employees, suppliers, and customers. It is a worthy governmental enterprise in my opinion. Demonization of a successful person like Bill Gates in a post is obviously fun for some envious people but in this case it is logically and factually worthless.

Posted by: Dennis Slater at January 6, 2004 09:34 PM | PERMALINK

Being single now, I'm with Kevin's sister. But up until recently, I was "head of household", with one son. I think I was able to claim the eitc a couple of times. Granted, it helped. Everything helps.

So I know that families, whether of four or more, or four or less, need whatever support they can get. I'm "single" now, but still with son at home and in school (alas, part time, so he is not "dependent" according to those that decide). Little has changed financially for me except for my tax responsibilities. (And I'm not going to get to earn $50,000/yr pay in my lifetime, tho I like Clark).

Therefore, I empathize with other single people with no children. Whether by choice or not.

And the "marriage" tax, what's going on with that? Not being married, I haven't paid attention. (I thought they got rid of it, okay, shoot me for being stupid!!!) I can kind of understand how the gov't wanted it. I.E. two people from two individual households come together and create one household. One rent, one set of utility bills, etc, etc, where once there were two (taxable parties), now there is one. Tax 'em extra!?!?!?

Granted, if the present "Christian" government is so marriage and family oriented (i.e. no sex outside of marriage--abstinence only), this "marriage" tax should not exist. I understand that financially, the marriage tax is at least part of the reason quite a few people don't "legalize" their union. (But that's their business.)

But I would not want NO tax responsibilities for myself. After all, the big fuss a couple hundred years ago was no Taxation without Representation.

I wonder, if I am not taxed, will my vote be taken away? Because some on the right have been putting up a fuss recently, it seems, that lots of people pay NO (income or payroll) taxes. Is this about to change to no Representation without Taxation? (Regardless of the rest of the sales, state, utility, etc., taxes.) I wouldn't put it past 'em.

So I think it is an idea to protect my responsibility, as it has become... to pay taxes to the feds, for the services and protections I and everyone else receive.

As for the Indians, I believe that the blankets blessed with small-pox came from the immune white settlers as a "gift" to the Indians. And those blankies did a lot to help along the extermination of the Native Americans. And I don't recall any white European settlers being sold into slavery by the Native Americans, as the white European settlers sold the Native Americans into slavery.


Posted by: Nermal at January 6, 2004 09:40 PM | PERMALINK
It is not Bill Gate's cost that would be impacted, but the consumers of software from developers everywhere. Enforcement of intellectual property rights most certainly benefits the entire industry and consumers not just Bill Gates or even just Microsoft and it employees, suppliers, and customers. It is a worthy governmental enterprise in my opinion.

For comments in defense of convicted monopolists, this has to be among the silliest.

Posted by: bad Jim at January 6, 2004 09:53 PM | PERMALINK

I actually caught the speech on C-Span. The best line?

"Freedom is not free."

How freaking brilliant is that? To take that line, so often used by Bush and his ilk, and stand it on its head. No, freedom isn't free, and it's always our young men and women who defend and protect our freedom, sacrificing their lives for the benefit of all of us. And why should they be the only ones making any sort of sacrifice? The wealthy, the millionaires, those who have "made it" owe their success to the advantages and opportunites and freedom that comes with American citizenship. Is it too much to ask that they make some small sacrifice as well, since they benefit so much from that freedom?

Freedom is not free! This is the line we need to use every times the right-wingers accuse us of raising taxes. Make it a matter of patriotism. As in, "oh, you don't think millionaires should be taxed more? Freedom isn't free, my friend. Why do you hate America so much?"

God Almighty, I do love Wes Clark.

Posted by: LAS at January 6, 2004 09:55 PM | PERMALINK

In regards to health care insurance, is it too much to offer all Americans a limited plan that would cover emergency services?

Perhaps even preventive services, say a visit once a year to the doctor?

A little wisdom and restraint might be in order. There's no reason why any American should have to pay for Emergency Services, and taxpayers pick it up most of the time from those who can't already pay and don't have health insurance.

And preventive care would go a long way to cutting health care costs in imperium.

Posted by: freelixir at January 6, 2004 10:12 PM | PERMALINK

Freelixir, at least in California emergency care tends to be free for those who can't pay, I think. It's a shitty way to deliver health care, as you'll concede.

We need a candidate to propose single-payer and lay out the costs and benefits. It's cheaper and better than what we've got, and it's time for somebody to say so.

We'll probably get there sooner or later, but if Clark (or someone) were to get out in front of this it might happen sooner.

Posted by: bad Jim at January 6, 2004 10:23 PM | PERMALINK

Ahh, the socialist paradise that was the Old West:

"I think we would have been safe there at least for a time, but father taking the baby from Augusta, started out on the open prairie. Mother took Caroline from me and tried to stop father, but it was useless. The terrible circumstances must have unbalanced his mind, naturally being very nervous.

The Indians had cleared out of our house and were returning to Mr. Boelter's. As they were passing a little corner of the timber one of them saw father and uttered a wicket piercing yell. It was but a moment when the whole band, about 20 men and some squaws, were upon us. My father began talking to the foremost Indians. My brother has told me that father asked them to take all his property but to let him and his family go. But the Indian replied in the Sioux language, "Sioux cheche," (the Sioux are bad.) He then leveled his double-barreled shotgun and fired both barrels at him. He dropped the baby -- she was killed -- and running a few yards down the hill fell on his face, dead. The same Indian then went to where my mother had sat down beside a stone with little Caroline in her lap, reloaded his gun and deliberately fired upon them both. She did not speak or utter a sound, but fell over dead. Caroline gave one little scream and a gasp or two and all was over with her. The cry rang in my ears for years afterward. My father was thirty-three and my mother thirty years of age when they were so cruelly murdered by the Indians.

How painfully distinct are all the memories of the scenes of this dreadful afternoon. While my mother was being murdered I stood about ten feet away from her paralyzed with fear and horror, unable to move. The Indian began loading his gun again and was looking significantly at me and my sister Amelia, who sat by my side. Suddenly I regained my self-control and, believing that I would be the next victim, I started up and ran wildly in an indefinite direction. Accidentally I came to where my father lay. He had on a checked shirt the back of which was covered with blood, the shot having passed clear through his body."

http://www.carriganlane.com/history/Capc2.html

And let's not forget the horrors those German and Irish farmers visited upon the peaceful Indians:

"On our march that day, an Indian went behind us with a whip, with which he frequently lashed the children, to make them keep up. In this manner we traveled till dark, without a mouthful of food or a drop of water, although we had not eaten since the night before. Whenever the little children cried for water, the Indians would make them drink urine, or go thirsty. At night they encamped in the woods, without fire and without shelter, where we were watched with the greatest vigilance. Extremely fatigued, and very hungry, we were compelled to lie upon the ground, without supper or a drop of water to satisfy the cravings of our appetites. As in the daytime, so the little ones were made to drink urine in the night, if they cried for water. Fatigue alone brought us a little sleep for the refreshment of our weary limbs; and at the dawn of day we were again started on our march, in the same order that we had proceeded the day before."

http://www.eyewitnesstohistory.com/cap.htm

Posted by: Joe Schmoe at January 6, 2004 11:22 PM | PERMALINK

Bad Jim asks:

"Young Matt, shouldn't China and India have rapidly declining populations?"

I cannot speak for India, and I suppose we are talking about modern China.

Well, Bad Jim, the bad news I have to report is that China won the cold war and in relative terms their government is about 45% smaller than the government we have.

According to my demographic curve, China should be suffering a dramatic drop in poverty, an economy that grows by 10% per year and decreasing income disparity. China should be the economic leader of Asia, and they probably have an increasing birth rate.

Most of which is true and bears out my theory.

China is a little odd in that their government has put in enormous incentives to keep the birth rate at exactly replacement or a little below.

By the way, let me remind you of one of the great predictors of population destruction in modern Europe is the single payer health care system.

To repeat, I find it odd that Dean, proposing national health insurance would cite Italy, Germany, France and Belgium as good models, because all of those countries suffer very large, and sometime devastating fertility declines.

The good doctor might be proposing our own destruction in short order if he thinks the Western Europe is the model.

I wonder that proponents of socializing the medical industry do not seem too concerned about the cost this places on young families, as evidenced by their inability to raise families and assure a nation's survival; yet if the same fertility decline were the result of an industrial chemical these same proponents would be screaming bloody murder.

Now, one could create a program that has the federal government participate in medical services for all, in a limited way. But, given the history of pandering and imaginary economies that guide the voters and their electors, such a limited program would soon bloom into a very badly designed, destructive machine.


Posted by: Matt Young at January 6, 2004 11:30 PM | PERMALINK

Actually, European health care is friendlier to children than American health care, being generally - ok - universally - available.

Posted by: bad Jim at January 7, 2004 12:28 AM | PERMALINK

I'd rather our human population would tread a little more carefully on the earth than it has done so far, and welcome a decline in growth rates in India and China, and fear for the fortunes of the West as these Eastern citizenries claim their places at the table.

I do think that if you offer a man a job, you should be offering him a reasonably good thing, which has to include health care and retirement, or at least a slice of it.

Posted by: bad Jim at January 7, 2004 12:37 AM | PERMALINK

"Actually, European health care is friendlier to children than American health care, being generally - ok - universally - available"

Then one has to explain why European countries are dying. If their population declines are voluntary, then why bother with child health care at all?

Otherwise, children rely on very little healthcare, though people often romanticize about the issue.

The real problem with child health care is that there are fewer and fewer middle class children in the Western world, mainly because prospective parents cannot maintain the surplus needed to support them properly, having to give up half the family resources to cover the cost of government.

Posted by: Matt Young at January 7, 2004 01:35 AM | PERMALINK

way too early to learn tomorrow's closing price of dollars in euros

Posted by: bad Jim at January 7, 2004 01:45 AM | PERMALINK

Joe, your reading of history is…um…rather bizarre. Tell me, which peoples were nearly exterminated by the 20th century in America, was it the natives, or the Irish and the Germans?

Can one find examples of how the native peoples treated individuals badly? Sure. Is there a moral equivalency between those relatively isolated incidents and the genocide inflicted upon those unfortunate enough to have inhabited the land, that Western Europeans wanted, before those invaders came? Not hardly. But thanks for demonstrating the kind of ahistorical silliness that should be mercilessly mocked.

Posted by: Lori Thantos at January 7, 2004 01:50 AM | PERMALINK

What do you mean, give BACK?

Posted by: Brett at January 7, 2004 02:46 AM | PERMALINK

Brett is clearly not an American.

Posted by: bad Jim at January 7, 2004 02:56 AM | PERMALINK

galnoir

Right now, employer and employee split a 12.4% tax on income up to a threshold of $68,000;
You are working with dated information. The threshold is $87,900, not $68,000.

The threshold for taxing matches the threshold used to compute benefits. If you eliminate the threshold for taxation, are you proposing elimination when calculating benefits? I bet not, but that means you cannot maintain the fiction that people are contributing for their retirement. If you'd like to be honest and label it a welfare program for the aged, we can honestly discuss the best way to fund the welfare program. If you want to maintain a weak semblance of an insurance like program, you can't use one base for taxation, and a lower one for benefits.

Posted by: Phil at January 7, 2004 06:14 AM | PERMALINK
I bet not, but that means you cannot maintain the fiction that people are contributing for their retirement.

Since it is, after all, a fiction to start with, I don't see why anyone gets so worked up about this.

Posted by: cmdicely at January 7, 2004 07:00 AM | PERMALINK
Then one has to explain why European countries are dying.

They aren't. They have negative growth rates at the moment for a large number of reasons relating to economic development (which has always in the industrialized world been connected to declines in birth rate) and social movements in Europe which have advocated successfully for reproductive restraint on the basis of desirability of smaller populations, among other factors. They also have longer life expectancies and lower child mortality rates than the US in many cases, which shows that it isn't a problem with healthcare being available or of adequate quality.

Posted by: cmdicely at January 7, 2004 07:04 AM | PERMALINK
I wonder that proponents of socializing the medical industry do not seem too concerned about the cost this places on young families, as evidenced by their inability to raise families and assure a nation's survival;

Young families don't want, for the most part, to ensure a nation's survival. They want to maximize their own personal utility. Where they aren't relying on children to support them if and when they become unproductive, either because the government provides for them if they do, or the government provides adequate healthcare to keep them productive, or some combination thereof, raising a family becomes less likely to be intimately linked to that utility in a consumer culture.

Posted by: cmdicely at January 7, 2004 07:08 AM | PERMALINK

Thanks for the info Cal, I'm inclined to agree with you.

Posted by: Richard Tilley at January 7, 2004 07:57 AM | PERMALINK

Lori,

Using your senseless line of thought and ackward logic, then everything ever invented could (and should) be contributed to the government. It is understood that we all stand on the shoulders of giants, but you seem to think that all of the hard working folks who have patents are just the lucky bastards that the governements allows to think they invented/created something new - and that, they really are just an extensions of what the government had done is some previous capacity.

I agree that the government plays a key role in the area of property rights and the protection of IP, but you are insinuating that private enterprise plays no role in the advancement of our society. Or at the very least, the role they play in only because of the government support. I think that view is so ludicrous, as for me to question the governemnt schooling you got.

Posted by: CK at January 7, 2004 09:04 AM | PERMALINK

LAS,

I almost don't even to know where to start with your post! You stated re: Clark's line 'Freeedom isn't Free', '... No, freedom isn't free, and it's always our young men and women who defend and protect our freedom, sacrificing their lives for the benefit of all of us. And why should they be the only ones making any sort of sacrifice? The wealthy, the millionaires, those who have "made it" owe their success to the advantages and opportunites and freedom that comes with American citizenship. Is it too much to ask that they make some small sacrifice as well, since they benefit so much from that freedom?'

What do you mean small sacrifice? You assume that every person who is (that dirty four letter word) 'rich' doesn't make any sacrifices for their country? Based upon what? What data do you have to support that type of stupid generalization?The fact that the 'rich' (there's that damn four letter word again) pay for the lions share of the services that you use! Did you know that the top 5% pay more than 50% of all taxes? The fact that it is the 'rich' (there's that dirty word again) who own the businesses that employ the vast majority of American workers! Did you know that of the 11M businsses in the US, more than 8.5M are small (mainly privately owned) businesses?

Most of the 'rich' (there's that damn dirty word again) are NOT against paying their 'fair share'. It just seems odd to tell someone who has worked hard, built a good life for them and their family, that paying 8-10 times what other make annually in taxes - is not enough of their fair share!

Posted by: CK at January 7, 2004 09:21 AM | PERMALINK

cmdicely,

Your view that population decline in Europe is not related to cost of government contradicts the data and contradicts the current politics of Europe today.

First, the data, which I post once again in this link

http://home.comcast.net/~young375/spending.html

which clearly shows that population decline is faster in countries with the greatest fiscal burden.

Second, you seem to neglect European politics in Germany, France, Italy, and the Nordic countries. All of these countries (and their government span the left and right) have taken to reform the fiscal burden by a combination of reducing health benefits, raising retirement age, adding personal retirement accounts, and dropping restrictive employment practices.

Nor does your idea that Europe deliberately forced their population rate down hold water. All of the population declines are being made up with immigration. In fact, one of the greatest political issues in Europe is an anti-immigrant push. Belgium, one of the darlings of big government politics, has a fertility level 25% below replacement and a much more brutal anit-immigrant policy than the U.S.

Nor does your analysis agree with common political sense in this country in which both political parties worry about the retirement of baby boomers and the effect that has on the next generation, codeword for fertility decline.

And the idea that this is a temporary drop in fertility is simply ludricous. Italy, another darling of the big government politicians has a fertility half of what they need for replacement, and they are engaging in deliberate policies (big government policies believe it or not!) to try to reverse the stem, even as their government is taking extraordinary measures to stem the immigrant influx from Africa. Same problem in Spain, where, even with a rightist government) the fiscal burden is among the highest and their fertility is even lower than Italy. They are going to the extreme of importing marraigable immigrants because of the dearth of new marraiges. Even France is growing concerned when their native fertility tipped nearly to 50% of replacement and the country had more practicing muslims than Catholics. They deliberately traded deficit spending for tax relief on young families, and went through a bitter political war to reign in the cost of civil service.


Unfortunately you continue with the myth that big government progams are simple accounting tricks, as if resources can be conjured up from thin air.
Actually, the population segment that funds big givernment is exactly the population segment that must produce the next generation. The problem is particuliarly onerous because it is the edcuated young people who understand the cost of raising children properly who drop out of the family business.


Posted by: Matt Young at January 7, 2004 09:45 AM | PERMALINK

CK, sorry that you find the straightforward proposition, when the government subsidies basic research they should be credited with it, difficult to understand. While I’m not clear what this bit of nonsense means “everything ever invented could (and should) be contributed to the government,” I suspect you meant to say “attributed,” and even that is merely a straw man (what is it with conservatives, damn) version of what I said. In fact, your entire post is nothing more than a ridiculous caricature of what I did say; which rather explains why you feel the need to “question the [government] schooling [I] got.”

You have inferred something from my post that is clearly unsupported by the text – to wit “private enterprise plays no role in the advancement of our society.” This is a far cry from my contention that most basic research is carried out under the auspices of governments and that corporations (or private enterprise) then use that basic research as a starting point for directed research. The government didn’t create the personal computer, but without government funded research into the transistor, there would be none. Let me say this again slowly so perhaps you can follow the “awkward” logic

1) Government: basic research
2) Private Enterprise: directed research

This means the government supports private enterprise in a way that benefits society. To demand that those enterprises, and those who benefit from them, pay taxes to continue this virtuous cycle is hardly unreasonable. I hope this is less confusing to you, but I’m sorry if such complex logic eludes you; perhaps you might try for one of those high school equivalency programs to get you up to speed.

Remember, this was in response to the laughable proposition that the government a) never creates anything, and (oddly contradicting itself) b) spends far more creating things than private enterprise would for the same product. My post simply demonstrates that a) is false and that b) is based on a misunderstanding of the difference between product and pure, research.

Posted by: Lori Thantos at January 7, 2004 10:15 AM | PERMALINK

By the way CK, I hate to ask for this, but can you back up your statement that the top 5% pay more than 50% of all taxes? I would like to see something that demonstrates this.

I ask because all the evidence in the real world points to a rather different conclusion: when taking ALL taxation into account, the tax rates are rather flat. This is in part because there are only two (rather mildly) progressive tax systems in use in the United States to any large extent, both of which are income taxes (one at the Federal level and one at the state – and not all states have income taxes). When taking all taxes into account one must include “user fees,” excise taxes, sales taxes, property taxes, payroll taxes, and the rest.

It appears you are overstating a common conservative canard, that the top 5% pay more than 50% of taxes, by which they imply (but don’t state so as to confuse the stupid and the inattentive) only Federal Income Taxes. This lets them mislead without lying, leaving the lies to be spread by the gullible (odd that such a common word isn’t in the dictionary), and leaving them to weasel out of culpability when called on the carpet.

Posted by: Lori Thantos at January 7, 2004 10:26 AM | PERMALINK

Lori,

I will provide a retort to your two posts:

Yes, I was caricaturing your post. That is the kind of response it deserved, like it or not!

The main reason is that you are operating under a couple horribly incorrect assumptions which destroy not only your credibility, but your arguments. Let me give you a couple examples:

- Your assumption that the government created the Internet. Not sure how much you know about the Internet per se. I assume that you are using the term 'Internet' to refer to the massive network of networks that exist and the different browsers and protocols that are used to navigate said networks. Reality is, the government may have funded ARPA (which was a project run by the DoD), but the Internet as it exists today has little to do with that. Although, as I stated, we all stand on the shoulders of giants! What really drove the Intenet as we know it today is the Network Working Group's development of open technical documentation for TCP/IP. From there, it was private enterprise/public companies that drove the mass adoption and usability of the Internet. So the government didn't invent the Internet, no one person or organizaton has done so.

- Your assumption that the government is the main entity doing what you call 'basic' research (the correct term is 'Pure' research) and therefore corporations are only successful due to the government benefits. That allows you to rationalize your belief that corporations should be more than willing to share in their spoils (from said research), as well as, why the 'rich' (damn that dirty four letter word) should be more than willing to 'give back' what they have. This is a notion which is just crazy. I will agree that the government does fund a good amount of 'Pure' research, but you are making the incorrect link that a project that is partially (or even wholly) funded by the government should then be treated differently than a project that is funded by priate enterprise. Not sure if you know this, but research by itslef does nothing! To use one of your previous examples, an IP stack doesn't have any use by itself. Only when it is used within a commercial product such as high speed DSL service sold to a customer - does it have a value. The point that you are missing, is that the government gets benefits from having its research used for Applied purposes (the correct term for 'directed' research is Applied). Don't you think the government (per se) is thrilled when companies like Dell and MSFT are created and become successful. Can't you see them smile from here when they think about the tax revenue those companies will generate. Not to mention the benefits in worker productivity, advancements in other technologies, etc. Your problem is that you only view a problem from your narrow, idealogic perspective.

- Finally, regarding the tax statement. You stated, 'when taking ALL taxation into account, the tax rates are rather flat. This is in part because there are only two (rather mildly) progressive tax systems in use in the United States to any large extent, both of which are income taxes (one at the Federal level and one at the state – and not all states have income taxes).'

I was referring to Income taxes, because that is the most discriminatory tax we have. The other taxes you refer to; such as sales taxes, property taxes and excise taxes are all based upon a persons choices of consumption (i.e. I choose to buy product A, therefore I am willing to pay the associated tax). Income tax is levied against a person simply based upon their income, nothing else. The people who are more successful in terms of Income generation are discriminated against with an 'excessively harsh' progressive tax. As for figures, I am not going to do your homework for you, but here is my source: http://www.irs.ustreas.gov/pub/irs-soi/01in01ts.xls

And here is the breakdown over the past couple years:
1999: Top 5%
55.45
2000: Top 5%
56.47

Posted by: CK at January 7, 2004 02:08 PM | PERMALINK

To the extent anyone give's a rat's ass by post 115, it should be noted that there is no more meaningless and misleading statistic in tax policy discussions than this "top 5% of earners pay 50% of the tax" quote. The reason is that the top 5% of earners also earn about 36%% of the income. If you go to say, the IRS website, you can see the data sliced up numerous ways which shows that to the extent the income tax system is progressive, it is progressive by fifteen percentage points -- and, of course, that spread does not include social security and medicare taxes, which could well knock the actual progressivity down under 10%. I find it funny that in virtually every tax debate "conservatives" trot out the 5%/50% comparison and "liberals" trot out the 5%/36% comparison and 100 posts later not much is accomplished

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