Total spending at all levels of government in the US is almost $7 trillion. So even if you tax the top 5% at 75%, you’re covering 17% of total expenditures. European countries don’t build their welfare states by heavily taxing the rich. In say Germany, an entry level office worker will pay 30%+ of their income in taxes and mandatory insurance.
And that's assuming a 75% effective rate, which you can't get at the 95th percentile without also charging high effective rates to the majority of people because it's not possible to charge more than a 100% marginal rate on the difference.
Idk according to my swedish coworker, there was a marginal tax rate of 70-80%++ from like 1940-1985 or something.
Here is a hypothetical calculation of someone making $120k USD who is married with two kids: https://home.kpmg.com/xx/en/home/insights/2011/12/sweden-inc.... Such a person pays roughly 50% in total taxes. In the US it would be roughly 25% (in Maryland).
Maybe the federal government offers lower tax rates based on how many different states the company has a sizeable portion of its labor force. Ie near zero for being spread out everywhere.
It's not about whether they are rich but about whether they produce income that can be taxed to pay for the needs of the poor.
good luck with the taxes thing though.
Isn't that unfair?
I personally recommend that we start in small experimental grounds. The idea of starting in the Bay Area is good because engineers are pushing hard workers into poverty, but they they go around with masks hitting people on the head with sticks just because they speak their minds.
The unfair part is that the 250k income of the software engineer is increasing demand for housing until it's too expensive for the cleaner although the demand and therefore price are high enough to warrant more housing it's not getting build because of zoning laws.
You say that's fair, but someone else could say it is unfair. The supply/demand equation you describe suggests how the salaries get decided upon, but that's not the same thing as fair. That's the system we have, but that doesn't make it automatically fair.
I mean, why should someone jump into the 1% simply for being engineer #2? Those gains are unfair, and should be taxed 100% to pay for healthcare for all.
No, they aren't. The system is older than any person alive today. It's older than people. It's a natural law of the universe. It's game theory and natural selection, ultimately, that plays the fundamental role.
It isn't about rewards or even about what's fair. It's about the market. You pay an engineer a lot of money because you need an engineer to do the job and the supply of engineers is low. On the other hand, the supply of people who can clean bathrooms is effectively unlimited. There are far more people willing to do the job than there are jobs for them to do.
Because people are paid for the value of what they produce, not the effort they spend producing it.
As long as people are ok with their money going into a mystery box they have no control over, holding no one accountable, how can we have anything BUT inequality?
As long as companies are free to play tax games and suck money out of the economy and then hang on to it for as long as they feel like it - how can we have anything BUT a screwed up volatile economy?
People talk about redistributing money as if there's a million rich people wiping their butts with 100$ bills and if only we could teleport that money outta their toilets, into the hands of those in need, we'd solve something.
Real solutions to real problems come with infrastructure, accountability, transparency.
They start in the mind, then go out into the real world. As long as in your mind it's republican vs democrat, rich vs poor or some other childish false dichotomy, we'll be right where we are, heading for serious social unrest.
As long as all their competitors are subject to the same tax, the price simply rises. This is why Apple products cost much more in the EU. Of course, if it were cheaper for a company to be located somewhere where they would not be subject to that tax, then you're simply just motivating them to relocate.
I am referring to this: https://www.cnbc.com/2017/05/02/apples-cash-hoard-swells-to-...
Companies should not be allowed to simply hang on to 250 billion dollars.
Imagine what could be done in science, infrastructure, services etc if 10% of that money went towards those things.
There's a great Peter Thiel clip about this that sums it up very well:
Why? They earned it. And have you seen how much Apple donates to charities? Bill Gates at one point had a net worth of over 100 billion dollars before donating a huge sum to charity. If 250 billion is too much, what is a good amount?
Right, we're suggesting seizing the means of production. Don't redistribute, predistribute!
Now, of course nobody is realistically suggesting taking all that money. That would be neither fair nor useful. Because everybody agrees that some reward is necessary to motivate people, and that they should get to enjoy the spoils.