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Barack Obama Speaks On Economy At Cooper Union
Topic Started: Mar 27 2008, 09:25 AM (608 Views)
Admiralbill_gomec
UberAdmiral
Quote:
 
EXPLAINING OUR UNITED STATES TAXING SYSTEM WITH BEER

Suppose that every day, ten men go out for beer and the bill for all ten
comes to $100.
If they paid their bill the way we pay our taxes, it would go something like
this:


The first four men (the poorest) would pay nothing.

The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.


So, that's what they decided to do.


The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve.  'Since you are all such good customers,' he said, 'I'm going to reduce the cost of your daily beers by $20. Drinks for the ten now cost just $80.' The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected.


They would still drink for free. But what about the other six men - the
paying customers? How could they divide the $20 windfall so that everyone would get his 'fair share?' They realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer.


So, the bar owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay.



And so:
The fifth man, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33%savings).
The seventh now pay $5 instead of $7 (28%savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22 % savings).
The tenth now paid $49 instead of $59 (15% saving s).


Each of the six was better off than before and the first four continued to drink for free, but once outside the restaurant, the men began to compare their savings. 'I only got a dollar out of the $20,' declared the sixth man. He pointed to the tenth man, 'but he got $10!'  'Yeah, that's right,' exclaimed the fifth man. 'I only saved a dollar, too. It's unfair that he got TEN times more than I!'  'That's true!!' shouted the seventh man. 'Why should he get $10 back when I got only two? The wealthy get all the breaks!' 'Wait a minute,' yelled the first four men in unison. 'We didn't get anything at all. The system exploits the poor!'


The nine men surrounded the tenth and beat him up.


The next night the tenth man didn't show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something very important....they didn't have enough money between all of them for even half of the bill!  And that, boys and girls, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.
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Dandandat
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Time to put something here
That is an amusing story, but has no implication on what we where disusing. It is more in line with trying to justify the Bush tax cuts which I assume was why it was written.

the moral of the story:

"Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier."

is pretty funny when you consider where they would go. To china? not likely the cultural shock would be to much for them, one of the more culturaly in line but more socialist European countries? No? I find it far more likely that the tenth man will be at the bar the next day because it’s the best game in town for him.


Besides that's simply more redirect and not even quantifiably actuate in and of its own issue.
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Admiralbill_gomec
UberAdmiral
Dandandat
Mar 31 2008, 04:57 PM
That is an amusing story, but has no implication on what we where disusing. It is more in line with trying to justify the Bush tax cuts which I assume was why it was written.

the moral of the story:

"Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier."

is pretty funny when you consider where they would go. To china? not likely the cultural shock would be to much for them, one of the more culturaly in line but more socialist European countries? No? I find it far more likely that the tenth man will be at the bar the next day because it’s the best game in town for him.


Besides that's simply more redirect and not even quantifiably actuate in and of its own issue.

It has every implication as to what we were discussing.

It is something I believe in. Tax us too much and some of us leave. Me, for example. I have the means, and the wherewithall to do so. I know many others who would, and could too.

Obama is as much of a Socialist as that idiot Bernie Sanders. He's just more presentable.
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Dandandat
Member Avatar
Time to put something here
Admiralbill_gomec
Mar 31 2008, 06:32 PM
Dandandat
Mar 31 2008, 04:57 PM
That is an amusing story, but has no implication on what we where disusing. It is more in line with trying to justify the Bush tax cuts which I assume was why it was written.

the moral of the story:

"Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier."

is pretty funny when you consider where they would go. To china? not likely the cultural shock would be to much for them, one of the more culturaly in line but more socialist European countries? No? I find it far more likely that the tenth man will be at the bar the next day because it’s the best game in town for him.


Besides that's simply more redirect and not even quantifiably actuate in and of its own issue.

It has every implication as to what we were discussing.

It is something I believe in. Tax us too much and some of us leave. Me, for example. I have the means, and the wherewithall to do so. I know many others who would, and could too.

Obama is as much of a Socialist as that idiot Bernie Sanders. He's just more presentable.

You? Sorry Bill your not the tenth man in the story, I'll give you the benifit of the doubt of being the eighth or maybe ninth man.

But lets see what the tenth man realy has to say.

First Bloomberg hosted Obama when he gave the speach in question.

but heres it is from the tenth man him self.

Quote:
 

Warren Buffett, the third-richest man in the world, has criticised the US tax system for allowing him to pay a lower rate than his secretary and his cleaner.

http://business.timesonline.co.uk/tol/busi...icle1996735.ece


You'll forgive me if I take the plite of the tenth man from these men before you. After all if they decide to stay in the US, I think we can stand to lose you and a few of your freinds. Not that I want to see you go, just dont buy into your hot air.


but yes this has been a tangent and your beer story was not what we where talking about.
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Admiralbill_gomec
UberAdmiral
Actually, I am. I may not be Warren Buffet, but my income is easily in the top 10%. Sucks to be me, doesn't it? :rotfl:

Just because some fuzzy-headed RINOs have ENOUGH income to not care about taxes doesn't mean that the rest of us should just sit here and take it. Do YOU, Dante? I don't like to waste money, and I'd much rather contribute to charity than have some governmental maw "eating" larger chunks of my income because they know what's better for me. I figured you would understand that. Sorry if I overestimated you. :wave2:
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Dandandat
Member Avatar
Time to put something here
Admiralbill_gomec
Apr 1 2008, 07:38 AM
Actually, I am. I may not be Warren Buffet, but my income is easily in the top 10%. Sucks to be me, doesn't it?  :rotfl:

Just because some fuzzy-headed RINOs have ENOUGH income to not care about taxes doesn't mean that the rest of us should just sit here and take it. Do YOU, Dante? I don't like to waste money, and I'd much rather contribute to charity than have some governmental maw "eating" larger chunks of my income because they know what's better for me. I figured you would understand that. Sorry if I overestimated you.  :wave2:

Sorry Bill, I can't see how you, with what you have explained about your self, would make it into the tenth man's spot. Even if you believe you eke it into the top ten present of income earners. No ones going to miss you when you leave the bar. Of course this is not at all a dig at you, I do admire what you say you have accomplished in life; but if we are going to disuse such matters lets be truthful about it. If you want to rewrite the story and make an eleventh mans spot be my guest, but as written they aren't talking about you.

No, I don't like to waist money, and no I would like to keep as much of it from the government as possible. What I do not do is depart from reality about the issue. It is true, what Buffet is saying, that he is taxed at a lower percentage of his income then his cleaning lady and there is something fundamentally wrong with that. If you want to lobby for lower percentages of taxes for all (with the proper cut in spending) I would support it 100%. And if you lobbied for a fair an effective flat tax type of scheme I could get behind that as well. But to believe a system correct where it is admissible to shelter money that by all accounts is "Income" under a different label simply to pay less taxes is wrong and the system should be corrected.

You can't affix the name RINO or Liberal to every person you disagree with and believe that makes for an effective argument, It's intellectually lazy. Bloomberg and Buffett aren't "fuzzy-headed", to even suggest so is laughable and only speaks to the weakness of your argument. These men are quite intelligent and the small empires that they have created only speak to that fact. Its far more then either of as have and most likely ever will be able to accomplish.

As for having "ENOUGH income to not care about taxes" by many peoples standards that description fits you; what's more is that by some peoples standards that description fits me as well. Which is why the word greedy is thrown around when arguments of the type you are giving are stated. While I don’t find it greedy, I do find it a bit ridicules to hear you make the accusation.
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Admiralbill_gomec
UberAdmiral
Dandandat
Apr 1 2008, 08:07 AM
Admiralbill_gomec
Apr 1 2008, 07:38 AM
Actually, I am. I may not be Warren Buffet, but my income is easily in the top 10%. Sucks to be me, doesn't it?  :rotfl:

Just because some fuzzy-headed RINOs have ENOUGH income to not care about taxes doesn't mean that the rest of us should just sit here and take it. Do YOU, Dante? I don't like to waste money, and I'd much rather contribute to charity than have some governmental maw "eating" larger chunks of my income because they know what's better for me. I figured you would understand that. Sorry if I overestimated you.  :wave2:

Sorry Bill, I can't see how you, with what you have explained about your self, would make it into the tenth man's spot. Even if you believe you eke it into the top ten present of income earners. No ones going to miss you when you leave the bar. Of course this is not at all a dig at you, I do admire what you say you have accomplished in life; but if we are going to disuse such matters lets be truthful about it. If you want to rewrite the story and make an eleventh mans spot be my guest, but as written they aren't talking about you.

No, I don't like to waist money, and no I would like to keep as much of it from the government as possible. What I do not do is depart from reality about the issue. It is true, what Buffet is saying, that he is taxed at a lower percentage of his income then his cleaning lady and there is something fundamentally wrong with that. If you want to lobby for lower percentages of taxes for all (with the approach cut in spending) I would support it 100%. And if you lobbied for a fair an effective flat tax type of scheme I could get behind that as well. But to believe a system correct where it is admissible to shelter money that by all accounts is "Income" under a different label simply to pay less taxes is wrong and the system should be corrected.

You can't affix the name RINO or Liberal to every person you disagree with and believe that makes for an effective argument, It's intellectually lazy. Bloomberg and Buffett aren't "fuzzy-headed", to even suggest so is laughable and only specks to the weakness of your argument. These men are quite intelligent and the small empires that they have created only speaks to that fact. Its far more then either of as have and most likely ever be able to accomplish.

As for having "ENOUGH income to not care about taxes" by many peoples standards that description fits you; what's more is that by some peoples standards that description fits me as well. Which is why the word greedy is thrown around when arguments of the type you are giving are stated. While I don’t find it greedy I do find it a bit ridicules to hear you make the accusation.

Dante,

You seem to think that the "tenth man" spot is made up solely of Warren Buffett and Bill Gates types. It isn't. You might look up the tax tables. I've posted the link that breaks down by decile before... or you can go to IRS.gov and check for yourself.

Yes, it was a dig at me.

As for greed, wanting to keep more of what I earn is not greed. I will not have some smooth-talking used car salesman who spouts Hallmark card platitudes tell me that I'm not paying enough in taxes.
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Minuet
Member Avatar
Fleet Admiral Assistant wRench, Chief Supper Officer
When did Dante start selling used cars? :shrug:

Why don't you drop the insults Admiralbill. They are hurting your argument more then they help by just making you look like the stereotypical pushy and greedy capitalist. If you want to prove the stereotype wrong then act in a more becoming manner. :tsktsk:
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Dandandat
Member Avatar
Time to put something here
Admiralbill_gomec
Apr 1 2008, 10:02 AM
Dante,

You seem to think that the "tenth man" spot is made up solely of Warren Buffett and Bill Gates types. It isn't. You might look up the tax tables. I've posted the link that breaks down by decile before... or you can go to IRS.gov and check for yourself.

Yes, it was a dig at me.

As for greed, wanting to keep more of what I earn is not greed. I will not have some smooth-talking used car salesman who spouts Hallmark card platitudes tell me that I'm not paying enough in taxes.

No its also made of Stan O'Neal types, to which you are not either. As I said, as written that beer story is not about you and when/if you leave the country will not miss you.

But no that's not a dig at you, it's a statement of reality. Nothing I have said would suggest you should not be proud of what you have accomplished.

As I said, I don't think it is greed either. I do find it ridiculous however how you make the accusation that men like Buffet make enough money not to care about taxes, when you make enough money not to care about taxes by many people's standards. To many of these people to wordy greedy does come to mind however.
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Admiralbill_gomec
UberAdmiral
Minuet
Apr 1 2008, 09:21 AM
When did Dante start selling used cars?  :shrug:

Why don't you drop the insults Admiralbill. They are hurting your argument more then they help by just making you look like the stereotypical pushy and greedy capitalist. If you want to prove the stereotype wrong then act in a more becoming manner.  :tsktsk:

Um, I was talking about Barak Obama, not Dante. Dante is a EE becoming an MBA, as far as I remember.

Have a nice day, Minuet. Enjoy following me around the board.
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Admiralbill_gomec
UberAdmiral
Dandandat
Apr 1 2008, 09:39 AM
Admiralbill_gomec
Apr 1 2008, 10:02 AM
Dante,

You seem to think that the "tenth man" spot is made up solely of Warren Buffett and Bill Gates types. It isn't. You might look up the tax tables. I've posted the link that breaks down by decile before... or you can go to IRS.gov and check for yourself.

Yes, it was a dig at me.

As for greed, wanting to keep more of what I earn is not greed. I will not have some smooth-talking used car salesman who spouts Hallmark card platitudes tell me that I'm not paying enough in taxes.

No its also made of Stan O'Neal types, to which you are not either. As I said, as written that beer story is not about you and when/if you leave the country will not miss you.

But no that's not a dig at you, it's a statement of reality. Nothing I have said would suggest you should not be proud of what you have accomplished.

As I said, I don't think it is greed either. I do find it ridiculous however how you make the accusation that men like Buffet make enough money not to care about taxes, when you make enough money not to care about taxes by many people's standards. To many of these people to wordy greedy does come to mind however.

Enough of those like me decide to either leave or (when penalized too much for our earnings) simply make do with less income. Done it before, can and will do it again. Once again, you fail to see the big picture. I'm describing a symptom which can grow and grow into an actual financial disease. There is an optimum tax rate out there (every country's is different due to standard of living. Too high a tax rate, and the incentive to earn at that level decreases.

Your reality, as I said, lacks the BIG PICTURE. You are focusing on specifics.

As for your last statement, I do have to care about taxes, but as I said above, I can make do quite nicely on half or less. It does affect me, as the percentage I pay is quite significant. I don't have the ability to function with the clear majority of my wealth sheltered in investments, so what you say is simmply incorrect. I hope to get to that point, but it ain't gonna happen.
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Dandandat
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Time to put something here
Admiralbill_gomec
Apr 1 2008, 11:31 AM
Dandandat
Apr 1 2008, 09:39 AM
Admiralbill_gomec
Apr 1 2008, 10:02 AM
Dante,

You seem to think that the "tenth man" spot is made up solely of Warren Buffett and Bill Gates types. It isn't. You might look up the tax tables. I've posted the link that breaks down by decile before... or you can go to IRS.gov and check for yourself.

Yes, it was a dig at me.

As for greed, wanting to keep more of what I earn is not greed. I will not have some smooth-talking used car salesman who spouts Hallmark card platitudes tell me that I'm not paying enough in taxes.

No its also made of Stan O'Neal types, to which you are not either. As I said, as written that beer story is not about you and when/if you leave the country will not miss you.

But no that's not a dig at you, it's a statement of reality. Nothing I have said would suggest you should not be proud of what you have accomplished.

As I said, I don't think it is greed either. I do find it ridiculous however how you make the accusation that men like Buffet make enough money not to care about taxes, when you make enough money not to care about taxes by many people's standards. To many of these people to wordy greedy does come to mind however.

Enough of those like me decide to either leave or (when penalized too much for our earnings) simply make do with less income. Done it before, can and will do it again. Once again, you fail to see the big picture. I'm describing a symptom which can grow and grow into an actual financial disease. There is an optimum tax rate out there (every country's is different due to standard of living. Too high a tax rate, and the incentive to earn at that level decreases.

Your reality, as I said, lacks the BIG PICTURE. You are focusing on specifics.

As for your last statement, I do have to care about taxes, but as I said above, I can make do quite nicely on half or less. It does affect me, as the percentage I pay is quite significant. I don't have the ability to function with the clear majority of my wealth sheltered in investments, so what you say is simmply incorrect. I hope to get to that point, but it ain't gonna happen.

Bill, I know you don't shelter the majority of your wealth in investment ... but a lot of people do. And that is the point, because it is wrong that you must pay a certain level of your income to taxes while they pay a less percentage. This is irrespective of whether you or they ultimately pay to much or to little in tax. The fact that you and they are treated differently is the wrong I am speaking out against. Both of yours and their income should be treated the same, no matter how that is ultimately treated, they should not have the ability to shelter their income. And as Buffet would tell you, they don’t even have a need to shelter it.

Also as Buffet shows is that this point you speak of, where enough people will decided to leave or simply make doe with less is no where near the point we are at now. At this point its nothing more then an amusing story about beer and one that does not reflect realty. If anything it is you who are missing the big picture with the idea that all these top earners are on the verge of flight from this country, because they aren't. There is nothing suggesting they are and there is no ideal place for them to go better then the US even if they did want to leave. Even if taxes return to Clinton levels the US is still the best place for them and proof of that this is the fact that during the Clinton years they did not leave.




And off topic; I am now graduated as an MBA.
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RTW
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Vice Admiral
Someone here doesn't understand the principle of investment tax shelters. It very well could be me.

Does the government not know about these evil tax shelters or does the government set them up purposely to encourage investment vs stashing cash in our mattresses?
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Minuet
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Fleet Admiral Assistant wRench, Chief Supper Officer
Admiralbill_gomec
Apr 1 2008, 10:24 AM
Minuet
Apr 1 2008, 09:21 AM
When did Dante start selling used cars?  :shrug:

Why don't you drop the insults Admiralbill. They are hurting your argument more then they help by just making you look like the stereotypical pushy and greedy capitalist. If you want to prove the stereotype wrong then act in a more becoming manner.  :tsktsk:

Um, I was talking about Barak Obama, not Dante. Dante is a EE becoming an MBA, as far as I remember.

Have a nice day, Minuet. Enjoy following me around the board.

I don't believe Mr. Obama was ever a car salesman either. Your comment seemed to imply that anyone who took the point of view that taxes were not being done properly right now was a used car salesman. If I misunderstood then I apologize.

However, if you think making a couple of comments in one thread is following you around the board then you should have a talk with a doctor that specializes in paranoia.

Your bullying is not going to work with me. If you don't want to engage in a normal conversation then just don't reply to me. But stop the insults and accusations now.
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Minuet
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RTW
Apr 1 2008, 11:36 AM
Someone here doesn't understand the principle of investment tax shelters. It very well could be me.

Does the government not know about these evil tax shelters or does the government set them up purposely to encourage investment vs stashing cash in our mattresses?

I am a bit confused as well.

Here in Canada we have Registered Retirement Savings Plans. You invest money for your retirement and you don't pay tax on the money now. You do pay tax when you take the money out - at retirement when you convert the money to a plan that pays out a certain amount each month or year. Your income is presumably lower at retirement and therefore in the end you will pay lower taxes. It's really more of a tax deferment then a shelter. And you can only invest a set amount each year.

I believe you have similar retirement plans in the US. But I get the feeling that the tax shelters being discussed here have nothing to do with retirement plans. If so then I would be curious to know exactly how much money can be sheltered from taxes by investing and what types of investments qualify?
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