It's precisely a terrible solution. Yes, taxes are hard, but a solution that punishes the poor (or the not rich) by not recognizing the marginal utility of money is terrible in any form.
The idea with a flat tax isn't to punish the poor, but to reduce tax evasion on the higher end, and to reduce to burden on the middle class.
'Fair' depends strongly upon one's beliefs, and can't be objectively defined.
Which is a position completely ignorant of the marginal utility of money. No, it isn't fair that for one guy 10% could be the difference between getting by and not getting by while for the other guy 10% means no change to his lifestyle all.
No, progressives think it's fair that the burden is felt equally and that requires understanding how money works.
> 'Fair' depends strongly upon one's beliefs, and can't be objectively defined.
Fair does depend on beliefs, but some people's beliefs are objectively stupid. Anyone who denies the marginal utility of money and insists a flat percentage is fair, doesn't understand money and doesn't belong in the conversation just as anyone who believes vaccines cause autism is objective stupid and doesn't belong in that conversation. Everyone has opinions, that doesn't make them equal.
For the record, I agree with Piketty, Marx, and others of that particular persuasion. I'm all for progressive taxation, wealth and inheritance tax, all of it. But I'm also not ignorant of history...
Anyhow, the example was just rhetoric. The point is that communism started because people thought it was unfair that there was a rentier class who essentially monopolized wealth because they had inherited wealth. And communism fell because people thought it was unfair that people who were lazy made the same as people who worked hard.
Studies have shown that most people in western societies prefer inequality as long as someone has less than them. They think inequality is 'fair'. Why do you think people value celebrities and rich people? People are happy with our 'lottery' system, where anyone can become rich, even if the majority don't, and even if the average struggles...
It's funny, you're arguing for progressive taxation, but you don't understand the history behind labour movements, equal rights, welfare, socialism, etc... Or why communism is relevant in a discussion about rational choice, inequality and perceived fairness.
I do get it though - Americans have been taught to hate communism, and thus have purged an entire century of socialist philosophy from their collective thoughts.
Comparing different schools of economic thought absolutely relates to a discussion about rational choice and fairness.
> Communism is not relevant just because we're talking about progressive taxation and that you think is simply shows you're too biased to have an intelligent conversation.
Too biased? In what direction? Have you even been able to ascertain what my position is?
> Your arrogance is sickening. You're a kid, still in college, and you're acting like no one else has heard of history, grow up and learn to engage like an adult. Have some thoughts of your own.
Do you know me? Yet you decide to attack me. Here's a few fun facts about me: I'm not a kid, I'm 30 and have been married for 4 years, have already had a successful career and am changing pace for awhile, and I'm in university because I want to be.
What I know about you - most of your replies in this thread have been one or two liners about progressiveness, with the words 'marginal utility' occasionally thrown in.
> No one is here for a history lesson from a kid who screams communism and socialism every time tax policy is brought up.
Again, just 1 question: What do you think my opinion on taxes is?
> Progressives think it's 'fair' that everyone pays what they can afford.
Which is not what progressives believe, and then you went full on communist with this little nugget
> Some people also thought "From each according to his ability, to each according to his needs" was fair.
And then you started pretending only you knew history.
I don't care what you position is, I'm replying to what you say, not what you think; I can't read your mind, only what you write.
> Do you know me? Yet you decide to attack me.
I don't have to know you to tell you you're behaving arrogantly, and I haven't attacked you, if you think I have, you don't know what attack means. I've criticized your bad behavior, nothing more.
> I'm not a kid, I'm 30
Still a kid to me bub.
> Again, just 1 question: What do you think my opinion on taxes is?
I know what your position is, you stated it
> I'm all for progressive taxation, wealth and inheritance tax, all of it. But I'm also not ignorant of history...
But that's not what we're talking about anymore because you can't stop being arrogant and have derailed any conversation to the point that I no longer care what you think. "But I'm also not ignorant of history", please, grow up, your superiority complex is disgusting.
But you've been breaking the HN guidelines over and over again, and I've asked you to stop many times. You need to stop categorically if you want to keep commenting here. These rules apply to everyone, and it wouldn't be fair to other users to let you get away with it.
I'd be happy to try to clarify this if you want to discuss it further, but [email protected] would be better than here.
1) utility maximization 2) Rawlsian justice 3) fee for service model based on benefits received from government
It's actually pretty hard to justify a flat tax from most underlying axioms. I think you'd actually have an easier time justifying a flat fee where everyone pays the same $ value regardless of income.
I also contest your assertion that "Conservatives think it's 'fair' that everyone pays the same rate." While that might be true for some conservatives, political support for progressive tax rates go much beyond Democrats.
Are you proposing replacing the tax bracket system with an algebraic equation?
I wonder if that would be more or less confusing. I guess if you just showed people "this is what the tax curve looks like", it would be obvious that:
1) They need to use a calculator or look up in the tax table.
2) You don't actually lose money when your income goes from $37,449 to $37,451.
What does this have to do with the poor? Are you under the impression your federal tax dollars get redistributed to the poor? Government contractors aren't poor.
Do you have any idea what percentage of government proceeds are redistributed to the poor? Do not include social security. That money was taken from them to begin with.
Look up what regressive means and what marginal utility means; nothing I'm saying has anything to do with how taxes are redistributed. Flat taxes are inherently unfair, they ignore the marginal utility of money; they are regressive.
I'm sorry but its just a terrible idea.
You can get a 0 deductions system with a progressive tax system too, it isn't some magical property of a flat tax.
The current system, in practice, is progressive up to the upper middle class, and regressive after that.
Flat tax rates aren't about taxing the poor (you can still build in income exemptions and most flat tax schemes do), but reducing tax evasion by the rich...
2) The proponents of flat tax schemes frequently set the exemptions low enough to raise the tax burden on the poor.
If governments really want to collect taxes from the ultra-rich, a wealth tax is what is necessary. However that alone poses problems because 'wealth' is not always liquid - do you tax the old lady whose house has appreciated significantly but who doesn't have an income? Do you tax an entrepreneur whose firm is worth several million but hasn't actually realized any significant income?
Anyhow, just a few musings, but the summary is that taxes are hard. Too high and people evade them, too low and the government has a shortfall...