IRS Buttwipes Tackle the Poor

[Cerek the Barbaric]

Originally posted by khazadman: There's just one problem with all this talk about taxes and the working poor. And that is the fact that they will get all their tax money back and in alot of cases some extra. The top 50% of wage earners in this country pay 96.09% of all taxes. It's past time that government stopped trying to shackle the producers in this country.

I don't know where you're getting your information, khazadman - but I can tell you for a fact that the highlighted statement above is completely wrong!!!!

As a mid-level manager, my income falls in the lower middle class section. With 3 kids, that gets eaten up pretty quickly. My wife and I both make decent money, but not great. We both have extra money withheld from our paychecks for taxes and this makes our annual refund a little better, but not much.

However, our refund doesn't come anywhere close to 100% and we for damn sure don't get any extra back. I don't know what source claimed people at our level of income got all our tax money back, but I can tell you from personal experience that doesn't happen.

[Timber Loftis]

Originally posted by Sir Kenyth: Dude! Of course they do! It makes perfect sense when you think about it! They pay 96% of the taxes. I'm also willing to bet that they make about 96% of the income! Listen to the way that comment was phrased! A perfect example of statistical nonsense! Sheesh!

They also, applying transitive logic, receive 96% of the social benefit of taxes (police protection, etc.). But, 96% is the wrong figure. The richest 5% own over 95% of the wealth, and the richest 50% own about 99.99999% of all the wealth. Of course we don't tax wealth, we tax income, so that 99.99999% of the wealth actually uses tax shelters to hide about 4% of its wealth, giving it a discount so it only pays 96% of the taxes - thereby ripping off the other 50% of the taxpayers.

After all taxes are paid everyone except poverty level people pay about the same amount percentage wise. This includes ALL INDIVIDUAL taxes paid. Income, property, and sales tax. It's been argued that I can't include state taxes in a coversation about federal ones. I beg to differ. Taxes are taxes and no matter how you divvy them up they still cost you the same!

Not really. Different states are so different in monkeys up a discussion. Take NH: no income tax, no sales tax (but an 11% tax at restaurants), but ask a property owner in NH where the government makes up for the money -- property taxes are among the highest in the nation. WHich is why it is better to *live* in VT and shop across the border. Of course, VT technically makes you list these tax savings on your VT return, so VT tries to charge you sales tax on NH-purchased goods. Everyone in VT I know just lies about it, though. If you looked at tax returns alone, you would think no one in VT ever shops in NH. LOL.

But, my point is made, and that is that factoring state taxes muddles a discussion. Sure, they are equally important and eeeeevil, but to talk about the particular economic effects you introduce too many variables unless you limit your discussion to "federal" or a "state v. state" comparrison.

Oh, and the above NH-VT relationship shows other economic concerns: to wit, the adverse effect the NH tax structure has on the VT retail economy. Of course, this is no different than the adverse effect one nation with weak enviro laws (again, NH) has on its next-door neighbor with strict enviro laws (again, VT).

[Sir Kenyth]

Timber:

Good points. You also bring up the interesting subjects of competition between the states. I know in Indiana, we're having problems. Industry seems to be leaving us a lot faster that we're getting it. That lowers the tax base and causes higher taxes and fees to try and compensate. That, in turn, causes more people and businesses to leave for greener pastures. A nasty cycle! Allowing production overseas doesn't help us much either. Unions seem to be disappearing at an alarming rate too. As a matter of fact, people seem to be getting brainwashed into thinking unions are bad. That should make any paycheck earner shiver! All in all, I don't like the way our economy seems to be going.

[Timber Loftis]

Not to rattle your cage, Sir Kenyth, but I too feel unions are bad. My secretary's son lost his job because it was a non-union shop and the union showed up and encouraged sympathy walk-offs. A dozen offices shut down in Chicago. All over a $3/hr. wage difference. (Note that this wage difference will just barely pay those union dues which support union top-echelon fat-cats lobbying in D.C. to the tune of $500K per year).

Unions had their purpose when workers were abused - but, after the gov't stepped in with OSHA and minimum wage and time-and-a-half laws, they became largely superfluous. Now, they are just a way to bully all workers into paying into an obligatory club that is more concerned with pushing companies to the brink of bankruptcy rather than actually representing its members.

$26 an hour for the seamstress industry - you gotta be kidding me. The textiles industry felt the same way, and now pays $26/day for 50 workers in a Chinese sweatshop, while the seamstress union now has nearly NO working union members in this country.

$28 an hour for a UMWA member to tighten bolt #365 over and over again all day? Again, you gotta be kidding me. Ford felt so - Mexico is cheaper labor - cheap enough to make it profitable to move a multi-million dollar auto plant.

And, let's not even talk about the 8-10 hoops you gotta jump through to fire some asshole worker who is rude to every customer, beligerant, and always late for work. Write him up 8 times and you still have to pay $5K to arbitrate - and then you still don't get to *fire* him unless it's his third or fourth screw-up. Oh, and because he's been there 3 months longer than the next guy, who is a wonderful A+ worker, you still must promote his lazy ass first. Sheesh.

As my secretary says, the unions created, and then destroyed, the American middle class.

Sorry to disagree, but while the *concept* of unions is noble, the modern-day reality is a disgrace.

[Edit]: Realizing you live in Indiana, I'm sure you have some perspective on unions, as well as you may likely be in one, so I welcome other points of view on the issue. I have not intended to prejudge this issue, and am open to rethink it. But, it seems to me that Inland Steel is operating on a skeleton crew in part because the Union keeps wages prohibitively high, making it impossible to get more workers on the payroll. In other words, the folks making $60K a year working in the steel industry these days are only doing so at the expense of their neighbors who have no jobs, or crappy jobs.

[ 04-28-2003, 01:39 PM: Message edited by: Timber Loftis ]

[Felix The Assassin]

Let me give you all an example of what the heck you are moaning about. For those that don't know, I'm at the bottom end of the government pay scale. My pay grade is E-7, with 20 yrs active service. I'm in charge of 25 soldiers(Health, Wellfare, and Training) one LT(Teach, Train, Coach) and over 4 Million dollars worth of assigned equipment.
This will cover the year 2002 Jan - Dec.
JAN - 15 deploy to gunnery.
FEB- 12 Return equipment to home station.
FEB-13 deploy to Peace keeping training session.
MAR-12 return to home station.
APR 1-15 Leave
May - 17 Deploy on peace keeping mission to a place called KOSOVO
NOV - 19 Return to home station.
DEC- 7 - Leave
JAN- 5 2003 return to duty.
Uncle Sam's Army does not pay any incentives for these types of missions. Yes other countries do, as is they volunteer for the tour. However, we fail to receive that luxury.
So, MAY - NOV I paid no FED TAX (Deployment)
MAY-NOV I received a whooping $100 a month extra for Hazardous Duty Pay (Tax Exempt)And wear the new body armor, 14 lbs heavier than the old flak vest.
MAY - NOV Received $150 a month for family seperation pay(Tax exempt).
2002 W-2 total block was less than $30,000. I used the professional software of choice "US Army Tax Center".

With my return I was able to take my family out to dinner, and wash the car.
So, go trucking pound sand!

Oh, I forget to mention.
During the months of deployment I missed 3 events.
1. My wife's birthday
2. Our 18th wedding aniversary
3. Our daughter's birthday.

Good I love this job.

Felix

[Thorfinn]

For a change, here, Timber, I am in agreement with you on virtually everything you said.

It is a waste to expend scarce resources on enforcement of abstruse regulations, whether those regulations be tax law, property law, or whatever. A far better use would be to write those rules much more clearly, understandable by anyone with a 5th grade education, and sufficiently small to make it not worth the effort to hire tax attorneys to get out of their tax bill in the first place. Problem is that none of the lobbyists want that to happen -- they would be out of a job since it would no longer be worth the money to try to influence legislation and regulation.

I also agree that while unions performed an arguably valuable service in the past, they currently have the effect of preventing newcomers into the job market from finding jobs, and Gary, Indiana is indeed a fine example of this. But I also see the minimum wage doing the same thing -- making sure that entry-level people, particularly in depressed areas, with poor education, and even more so, those with a rap sheet, are never given the chance to get job skills, and get a decent pay.

I would question your idea that 50% of the people own 99.99999% of the stuff, though. Got a source?

antryg, despite what you hear about the rich getting by with no taxes, we do have something called the Alternative Minimum Tax, which prevents people from having to pay less than 25%. True, multi-millionaires can get by a little less than this through tax shelters, but not a whole lot. In fact, most who advertise the fact they did get thrown in prison.

Sir Kenyth, I am building my new home between Westville and LaPorte, and I manage plant construction for a living, and can tell you unequivocably that a large part of the dearth of business and industrial construction in LaPorte County is the new building inspection process, implemented some 18 months ago, and still going through "corrections" to work properly. Most of the contractors I know have just sought contracts out of the county, even travelling to South Bend or North Liberty daily, rather than deal with the sometimes arbitrary building inspectors in LaPorte County. (Actually, one inspector causes most of the problems. If you talk to the right guys, they are happy to tell you what they want to see, and if you talk with them ahead of time about things that are not expressly covered by the code, getting the signoff is no problem, but one of them changes his mind as often as most people change underwear. That does not make for happy subs, because they would rather spend most of their day actually working, rather than kissing up.) Anyway, thanks to the fact that LaPorte County took the financial incentive offered by the previous Administration to implement their new zoning and planning recommendations, your taxes will go up, because at present, businesses can set up operations much cheaper on the outskirts of South Bend...

Felix, I feel for you, and it seems odd, but we can find plenty of people willing to volunteer to kill and die for that small of an amount of money. Offering more would just encourage more people to become soldiers, which would more or less force the US to send y'all to even more countries, if for no other reason than to justify the increased costs.

Well TL, you already know how I feel about the IRS [img]smile.gif[/img] I think they should be disbanded and a national flat tax rate established with no loopholes [img]smile.gif[/img]

As for the EITC...I think it is an abomination and has no business being in the tax code. If you want to give other peoples money away, just hire a mugger to take it and not use the tax code Harrrrumph!

[Sir Kenyth]

Thorfinn, sound like we live right next door to each other! [img]smile.gif[/img]

Timber, as much as I hate to do so, I agree with your assessment of what happened to unions. I've seen quite a bit of what you describe. I, personally, am not a blue collar worker. I'm an IT guy and do qute a bit of job hopping like most in my field, trying to get experience in all the latest software. I earn a decent wage, but nothing special. My field has also seen a big slump these days. I see how unions could be a GREAT tool at keeping a fair wage. I think, in concept, they're very good for workers. Unfortunately, they got big, they got centralized, and they got corrupt. A common story in big business.

The thing is, back in the day, a man could work a blue collar job and support a house and family decently. With all the real estate being taken over for "Rentals", building/owning a house is outside of most peoples wages unless both parents work a good job. The standard of living you can buy is the true gauge of wages, not the dollar amount paid. It seems to me that we put in a lot more work hours for less buying power these days. Maybe I'm wrong.

Felix, I'm a Gulf War vet. I feel your pain! [img]smile.gif[/img]

[Timber Loftis]

1992 Survey of COnsumer Finances:
Bottom 40% income = 1% of the wealth (doing our math, Top 60% = 99% wealth)
Top 1% income = 30% of wealth
Top 5% income = 55% of wealth
Top 20% income = 80% of wealth

My numbers weren't that far off for out-of-memory off-the-cuff use. Plus, since 1992, if trend of the last 100 years was followed (which it was), the gap between the richest and poorest has grown, skewing these numbers even more.

Originally posted by Felix The Assassin: Let me give you all an example of what the heck you are moaning about. For those that don't know, I'm at the bottom end of the government pay scale. My pay grade is E-7, with 20 yrs active service. I'm in charge of 25 soldiers(Health, Wellfare, and Training) one LT(Teach, Train, Coach) and over 4 Million dollars worth of assigned equipment. This will cover the year 2002 Jan - Dec. JAN - 15 deploy to gunnery. FEB- 12 Return equipment to home station. FEB-13 deploy to Peace keeping training session. MAR-12 return to home station. APR 1-15 Leave May - 17 Deploy on peace keeping mission to a place called KOSOVO NOV - 19 Return to home station. DEC- 7 - Leave JAN- 5 2003 return to duty. Uncle Sam's Army does not pay any incentives for these types of missions. Yes other countries do, as is they volunteer for the tour. However, we fail to receive that luxury. So, MAY - NOV I paid no FED TAX (Deployment) MAY-NOV I received a whooping $100 a month extra for Hazardous Duty Pay (Tax Exempt)And wear the new body armor, 14 lbs heavier than the old flak vest. MAY - NOV Received $150 a month for family seperation pay(Tax exempt). 2002 W-2 total block was less than $30,000. I used the professional software of choice "US Army Tax Center". With my return I was able to take my family out to dinner, and wash the car. So, go trucking pound sand! Oh, I forget to mention. During the months of deployment I missed 3 events. 1. My wife's birthday 2. Our 18th wedding aniversary 3. Our daughter's birthday. Good I love this job. Felix

Felix I was gonna snip your post in my reply, but I think people need to be reminded what people int he military go through. I was only an E6 when I got out.

The very idea that they tax the military to start with is kind of perverse, as an E4 I did the math and fouind out that if you averaged my income to the hours I worked, I was making way less than minimum wage. There are the occasional fringe benefits active duty types get, but all in all if you have a family in the military you are scrimping. I think they ought to just tax exempt the lot of you.

HOWEVER, as an E5 single person I was living a life style I had to earn $40k on the outside to maintain. Being single in the Military is not too bad at all....In my opinion...I was in for 10 years...all of it as a single person.

EDIT: WOW I just looked closer at the numbers on your special pay alloances...Jeeez did they ever improve those since I was in!!!

[ 04-28-2003, 03:43 PM: Message edited by: MagiK ]