Bill Gate's Solution to Income Inequality

[Tonus]

What do you guys and gals think about a consumption tax instead of an income tax?

With a reasonable deduction and perhaps an expansion of which items are exempt from sales tax, it could have a positive effect over time. Probably not much of an impact on the poorest Americans, but it could encourage the middle class to save money and pay down debt instead of continuing to live one or two steps above our means. I am wondering how this impacts capital gains... is it an attempt to protect those?

A 'diagonal tax' might do the job better: tax all income above X threshold at Y percent. The poorest Americans pay no tax at all, and the wealthiest can't shelter so much of their income that they pay a lower effective rate than the middle class. Adjust X and Y as needed. Or add a Z modifier for all income above a second threshold, which might start us down the road to the same system we have now, but could be fairer in the short run.

[Heywood]

You are the sucker that falls for the ball and cup trick not understanding the ball is palmed under the Monty's hand and they chose which cup they put it under. You have no say in how the game is set up.

Brian37, I am not a sucker as you suggest. I have been exposed to a new idea and I am examining its merit or lack their of. You one the otherhand...are simply an automaton...incapable of independent thought. You need MSNBC, Rawstory, the DailyKOS, to do your thinking. You are incapable of contributing to this thread in a meaningful manner so please exit it.

[Heywood]

Economist Robert Frank explains the consumption tax and makes some other interesting observations about our society.

[fr0d0]

If your poorest wage earners earn less than it costs to feed, clothe and house themselves then no tax break is going to help. The Walton family that own Walmart earn too much to spend, whilst their workers are striking for minimum wage. The middle and upper classes are subsidising the Walton family by paying Walmart workers benefits so that they can live.

It is just as valid to say that the Walton's are subsidizing the government.....who then subsidize the poor. The taxes paid by the Walton's go toward the benefit the workers they employ. Some think the Walton's are getting a break at the expense of the tax payer....but they forget that the Walton's are also tax payers.

Its not that I am unsympathetic to the plight of the poor. I have come to the realization that no matter what we do, there will always be people who can't or are simply unwilling to support themselves to a standard we deem reasonable for a human being. We can and should help these people and helping these people requires a transfer of wealth from the richer of society to the poorer of society. The one advantage of doing that transfer via a government programs is that it doesn't monkey with the labor markets like a minimum wage does. In my opinion a rag bag of government programs is better than a minimum wage....but what is even better than a rag bag of government programs....is a universal basic income.

This system is a sickness. We shouldn't be thanking the Walton's for the crumbs from their table. We shouldn't be allowing the obscenity of them having enough money to end world poverty. We should be limiting their earning potential to human levels. Ending their control of the media and politicians to further fatten their wallets. This is just obscene. What we're witnessing with some of the super rich gesturing at giving back the tiniest fraction of their wealth is them getting very worried that 7 billion people might want their fair share back.

[Heywood]

This system is a sickness. We shouldn't be thanking the Walton's for the crumbs from their table. We shouldn't be allowing the obscenity of them having enough money to end world poverty. We should be limiting their earning potential to human levels. Ending their control of the media and politicians to further fatten their wallets. This is just obscene. What we're witnessing with some of the super rich gesturing at giving back the tiniest fraction of their wealth is them getting very worried that 7 billion people might want their fair share back.

One advantage of a consumption tax is that contributions made to political campaigns by wealthier individuals would be taxed at a much higher rate than contributions made by poor people. If a person is so poor that they don't pay the consumption tax, a $100 dollar contribution they make to a campaign would only cost them $100. For a rich person subject to a 100% consumption tax it is a little different. That $100 contribution the rich person makes to a candidate actually cost him $200. A consumption tax equalizes consumption....including consumption of speech.

And to your point, you really shouldn't care that a rich person has more 0s in his ledger than you.....it isn't important. A millionaire living in a trailer park shouldn't be punished for being a millionaire. But if that millionaire drives a car, while you ride a bike, if that millionaire gets his teeth fixed while you writhe in pain, if that millionaire eats until he vomits while you starve.....then you should care....then that millionaire is doing an injustice to you. Inequality in consumption is the real problem...not inequality in dollars or income.

Now I am not sold yet on a consumption tax instead of an income tax. However I am convinced that it actually considers the real problem and not some side artifact.

[Brian37]

This system is a sickness. We shouldn't be thanking the Walton's for the crumbs from their table. We shouldn't be allowing the obscenity of them having enough money to end world poverty. We should be limiting their earning potential to human levels. Ending their control of the media and politicians to further fatten their wallets. This is just obscene. What we're witnessing with some of the super rich gesturing at giving back the tiniest fraction of their wealth is them getting very worried that 7 billion people might want their fair share back.

One advantage of a consumption tax is that contributions made to political campaigns by wealthier individuals would be taxed at a much higher rate than contributions made by poor people. If a person is so poor that they don't pay the consumption tax, a $100 dollar contribution they make to a campaign would only cost them $100. For a rich person subject to a 100% consumption tax it is a little different. That $100 contribution the rich person makes to a candidate actually cost him $200. A consumption tax equalizes consumption....including consumption of speech.

And to your point, you really shouldn't care that a rich person has more 0s in his ledger than you.....it isn't important. A millionaire living in a trailer park shouldn't be punished for being a millionaire. But if that millionaire drives a car, while you ride a bike, if that millionaire gets his teeth fixed while you writhe in pain, if that millionaire eats until he vomits while you starve.....then you should care....then that millionaire is doing an injustice to you. Inequality in consumption is the real problem...not inequality in dollars or income.

Now I am not sold yet on a consumption tax instead of an income tax. However I am convinced that it actually considers the real problem and not some side artifact.

It isn't about one person having more than me. It is the average climate collectively. Just like climate change deniers who are going to look at this current polar vortex bringing in cold weather and snow and stupidly think "its cold and snowing so climate change isn't happening".

It is an average, of temperatures worldwide and the part that they forget is that the cold is more extreme while on the lower hemisphere the heat is more extreme. And you combine that with temperatures taken in 100,000s of locations from every day for decades and decades you add them up and average them out.

Same with the economy. We know ratio wise that the bottom is NOT keeping up with the top even if you want to claim it is going up. It is an extreme because of the gap.

I am tired of anyone arguing they know what is best for everyone else. There is more than one class in this country and you do not get to decide for the rest of us alone how business is conducted.

[Heywood]

Same with the economy. We know ratio wise that the bottom is NOT keeping up with the top even if you want to claim it is going up. It is an extreme because of the gap.

No you don't know that. Income is not a good indicator of consumption. Consumption is a good indicator of consumption. If you want to know if the bottom is keeping up with the top....look at consumption. Is the consumption at the top increasing? Sure...Is he consumption at the bottom increasing? Sure. Which is increasing faster?

You guys on the left like to latch onto income...because it sounds good and supports your narrative. It makes it easy for you to make rich people into boogeymen so you can scare people into voting/donating your way.

[Brian37]

Give it up Haywood. You are merely arguing for your own selfish self interests. It is the same old argument "I know what is best for everyone else". NO you do not. No one is buying your trickle up crap.

[Brian37]

It is just as valid to say that the Walton's are subsidizing the government.....who then subsidize the poor. The taxes paid by the Walton's go toward the benefit the workers they employ. Some think the Walton's are getting a break at the expense of the tax payer....but they forget that the Walton's are also tax payers.

Its not that I am unsympathetic to the plight of the poor. I have come to the realization that no matter what we do, there will always be people who can't or are simply unwilling to support themselves to a standard we deem reasonable for a human being. We can and should help these people and helping these people requires a transfer of wealth from the richer of society to the poorer of society. The one advantage of doing that transfer via a government programs is that it doesn't monkey with the labor markets like a minimum wage does. In my opinion a rag bag of government programs is better than a minimum wage....but what is even better than a rag bag of government programs....is a universal basic income.

This system is a sickness. We shouldn't be thanking the Walton's for the crumbs from their table. We shouldn't be allowing the obscenity of them having enough money to end world poverty. We should be limiting their earning potential to human levels. Ending their control of the media and politicians to further fatten their wallets. This is just obscene. What we're witnessing with some of the super rich gesturing at giving back the tiniest fraction of their wealth is them getting very worried that 7 billion people might want their fair share back.

I love your intent for the most part, much more so than our "screw the poor" friend Haywood. It isn't so much that we should limit pay as much as it is that the ratio should be closer that what Haywood has argued. Our pay gap hurts us, and I still would want workers worldwide to improve in pay and say regardless of boarders. The floor has to keep up with the top. Outside that I do agree that the climate of global corporatism is obscene. Haywood would have us believe that wealth never does anything wrong and we dont have a say because we are not rich.

The part he does not get is that all aspects of life are run by humans, be it political party, religion OR private sector, and all of those things require income to keep and maintain power, and as such ALL of those things are subject to abuse and monopolies. He stupidly thinks that right now because he sides with one POV that everyone outside that POV agrees with him, and we don't.

You'd make a great atheist FYI, any ABBA fan would make a great atheist.

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Our global market does not lift up more people, it is a competition for cheap labor and a race to the bottom. We need a better climate where the gap is not as big where differences still exist and where wealth is more concerned about standard of living rather than a chase for the buck. Our casino global market is not investment, it is a casino.

[Mister Agenda]

Cons: Well, the problem is that, while in absolute dollars the consumption tax hits the wealthy more, in relative terms it will swallow every cent of the poor's money. Why? Because the poorest Americans save nothing on average, being forced to spend every cent they make to survive. It's this fact that keeps them from having to pay taxes, and this fact that would make a consumption tax on them equal to 100% of their income.

Fuck you, Woodie. Go back to sucking Koch Kock.

Hm. I don't see this quote in the article, which postulates a standard deduction, for example, $30,000 for a family of four, and a progressive rate that starts around 10%. I see some possible pitfalls with the scheme, but over-taxing the poor is easily avoided with a large enough deduction for initiial income.

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The 2 million dollar mansion cited as an example, could be built in another country.

Well, the example is a 2 million dollar wing to add to an existing mansion, but yeah, schemes to avoid the tax would be forthcoming.