Hypothetical Question on Ethics

**Doodyps** · 03-11-2009 01:55 PM

If you are earning $1 billion dollars a year (at current $ value), do you believe it is ethical or justifiable for the gov't to tax 90% of it, leaving you with $100,000,000.00 take home? At what point (% or $ amount) is it too much?

I will wait for some responses before giving my opinion.

**BusinessAdviser** · 03-11-2009 02:16 PM

Income taxation, as the major source of revenue for the U.S. government, is absolutely absurd.

**The Phantom Ghost** · 03-11-2009 03:06 PM

Sod em, put it offshore.... better your pocket than theirs... they will only use the money to line their pockets and fund more wars...

**Doodyps** · 03-12-2009 11:28 AM

Well, I was hoping for more responses and someone to argue with. I agree with the general sentiment so far. Point being, it's not about how much the government "lets you take home", but the principle behind de-incentivizing productivity.

I believe in government. I even believe in government funding for all kinds of research in technology and health care. 50 years ago, no private company could have had the funds and long term outlook for space exploration. It was a project that only the government could take on and has yielded unbelievable advancements for the private sector. I also believe it will take government funds to solve many diseases that simply aren't common enough to make funding and drug development worth the risk.

There are many many things the government is needed for and does fairly well, but in my own mind, I cannot imagine paying anything more than 25% of what you earn in taxes. I certainly don't agree with the way we are taxed through our income. I believe in a flat sales tax or a transaction tax.

I also can't stand that people who rely on government payouts and entitlements are aloud to vote. The whole idea that this country is more and more considered a "democracy" instead of a Republic is sickening. Democracy IS tyranny. No one should want to live in a democracy. I think this guy is dead on...YouTube - Democracy vs Republic

It's insanity that more and more, a smaller and smaller minority are forced to pay a larger and larger ratio of the taxes. The top 10% pay 70% of the taxes (Who Pays Income Taxes? See Who Pays What). That means everyone else is basically feeding at the trough while a few run back and forth to fill it.

I despise poverty, believe me. I want everyone to enjoy good health, good food, and the best of creature comforts, but our current system is not the way to achieve that. Instead government retards production in the future so we can have a few comforts today. What happened to making smart decisions?

**Proph** · 03-12-2009 01:54 PM

sorry you won't get an argument from me, if i were to make that money or even win some millions in the lotto my money and I would be out of here so fast it would make the custom officer's head spin. In fact i have been considering leaving anyway.

the founding fathers were much smarter than we gave them credit for.

"I predict future happiness for Americans if they can prevent the government from wasting the labors of the people under the pretense of taking care of them. "
Thomas Jefferson

**justy540** · 03-12-2009 02:42 PM

BA,
what would you propose as the primary source of revenue?

Am I the only super Liberal poster on these boards?

**BusinessAdviser** · 03-12-2009 04:06 PM

Originally Posted by justy540

BA,
what would you propose as the primary source of revenue?

Am I the only super Liberal poster on these boards?

Consumption tax.

We're the only developed, industrialized nation with income tax as our government's main source of income.

In addition to punishing those who work hard to earn money, income tax fails to dip its hands into illegal activities. With a consumption tax, there would be an incentive to save more for retirement (lessening the impact of a failed social security system) and would generate much greater revenue, as drug money spent on new cars, for example, would finally be taxed.

**justy540** · 03-12-2009 04:44 PM

My problem with that is that a consumption tax shifts the tax burden disproportionately to the poor/ lower-middle class, as they don't have money to save, so all of their income is taxed. Meanwhile, the investor class that has their money tied up in investments, pays noting unless it's spent. This has the potential to foster massive wealth accumulation by a few and create a permanent ruling class.

**Doodyps** · 03-12-2009 09:16 PM

Originally Posted by justy540

My problem with that is that a consumption tax shifts the tax burden disproportionately to the poor/ lower-middle class, as they don't have money to save, so all of their income is taxed. Meanwhile, the investor class that has their money tied up in investments, pays noting unless it's spent. This has the potential to foster massive wealth accumulation by a few and create a permanent ruling class.

It does shift more of the burden to the lower class since right now they pay nothing in income taxes. But people with money spend more money and therefore continue to carry the burden of paying most taxes. However, it finally ENCOURAGES saving. That is a good thing for the poor. Being poor is hard. Not having money is hard. The more money you have, easier access you gain to more capital. So step one to financial success is to gain and save capital. Could you imagine if people in the country knew how to make their money work to gain them more capital. Poor people will spend less frivolously because they will benefit from saving. Saving is the first step to making more money. Our system right now does not encourage saving or making more money or taking risks. Our system taxes people on risk taking (essential for success, through a capital gains tax).

You can still send tax credits to the poor to offset the extra burden they would experience from this anyway. Easily solved. I could tolerate that a lot more than the current system. The government doesn lose any income, and the poor wouldn't experience more of a burden. It just reorganizes the incentives into a healthier model.