Well that certainly is a stupid headline. But in today’s whacko conservative mind, it apparently is true. (Cross Posted at RMG)
Adam Smith the founder of modern economics and author of The Wealth of Nations that first outlined the virtues of the emerging capitalist system, wrote the following in his seminal work:
The necessaries of life occasion the great expense of the poor. . . . The luxuries and vanities of life occasion the principal expense of the rich, and a magnificent house embellishes and sets off to the best advantage all the other luxuries and vanities which they possess. . . . It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
Let me repeat that:
It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
Hat tip to The New Yorker for bringing this to light.
So more than 40 years before Karl Marx was even BORN, Adam Smith in 1776 was in favor of a progressive tax code…the same kind of tax code that Obama favors and the same progressive tax system we’ve had in this great country for nearly 100 years. But yet today’s conservatives call this system a socialist, radical, Marxist “redistribution of wealth”.
The simple reality is that it is modern conservatives that have the radical ideas and Obama embraces a concept deeply rooted in the capitalist system.
…a secret Muslim, btw.
that his full name was Adam Hussein Smith
I think his middle name was Muhammad.
Numbers are dropping!
It still won’t be true
Obama and the rest of his campaign. 7 more days and so much could happen. The MSM will be going into overdrive to try to convince McCain supporters that all is lost, try to “silence” any opposing viewpoints and try to make Obama look as Presidential as possible. And it might just work.
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p>But I’m getting a good feeling as people seem to be coming tot heir senses. Now if we could only get the message about Obama redistributing the wealth out there to the masses. Try to explain about the 40% of the people in the US who don’t pay a single nickel of taxes but will be getting welfare or rebate or stimulus or whatever other phony label they want to call the “redistribution” of us tax payers taxes.
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p>Obama is playing out the clock with his fingers crossed. Don’t be picking the new drapes out yet…
I would think the last thing that Obama wants to do is wait this out, we all understand that we need a good turnout in all states, not just for the POTUS but down ticket races. Make no mistake the GOTV by the Obama campaign will be in full gear.
That’s just false. It’s been debunked so many times that it’s not worth linking. Some beneficiaries of the Obama plan may not pay income tax, but they sure do pay social security and many other taxes. You betcha they do, gosh darn it!
sales tax they pay when eat at McDonalds.
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p>And oh BTW, who do you think will be using all that bountiful SS money they contributed when they get older… not the “rich” people. Those same low income people will take the measly total they contributed their whole life out of SS in the first 2-3 years and then take all the money the “rich” people contributed. They got it going on all over. Great scam!!!!
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p>Too bad nobody in office has the balls to fix SS. GW tried but even the Republicans didn’t have the stomach.
The guy never made more then $6.50 an hour by the time he retired from Westinghouse and ’83 (a solidly middle class income for the time), but he’s sure living high off the hog now! $1,000/month with his $200/month going to prescription drug costs. The guy is a pure mastermind when it came to his retirement scam.
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p>I guess my grandfather is essentially a welfare queen living at the teat of the nanny state. Here I thought he was an honorable man who fought in WWII and afterwards did what you were supposed to do: worked hard for the same company for 40 years, bought a home, a car, raised 5 kids, and put some money into savings. Next time I see him I’ll let him know that I won’t stand for him to keep “scamming” rich people and through Social Security. I’m gonna give that 88-year-old scumbag a piece of my mind!
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p>And, like John McCain said, we should cut his medicare benefits. Speaking of McCain – he collects $58K a year in SSDI. He seems to be able to hold his current full-time job and is currently lobbying for a job that is more demanding and higher paying. Talk about double dipping!
Bush didn’t ‘fix’ SS by having people put their contributions into the stock market. Think how much better off they’d be today! Why, I bet the fund managers alone could add hundreds of millions to their retirement nest eggs.
Ya, you sure showed me, you betcha!
I’m a baby boomer and SS is going to be the next financial meltdown. So far our politicians have handled it like sub-prime lending… basically ignore it, close their eyes and hope it goes away. But it won’t.
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p>Tblade’s sad story about his grandfather is not the point. The point is how much money did your grandfather “deposit” into SS? ($6.50/hour is $13,520/year and if they take 6% that’s $811.20/year and yet he now gets $1,000/month). And I’m sure $811 was the most he ever paid so maybe he would drain every nickel he “deposited” in 2 years. That IS a scam. Where do you think the balance of his checks will come from? US. His $200 prescription costs have nothing to do with his SS check. And tblade, you just described my Father as well but that doesn’t change the facts. My Father died 3 years after retiring and probably took much more in SS checks than he deposited and it’s just wrong IMO.
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p>McCain gets $58K in SSDI. Sounds like another scam so let’s change that rule too. I never said it was a good idea. I went to college with a kid who’s father was very old and was on SS. My friend would get a check from SSDi every month… WHY???? Another scam.
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p>Private contributions being managed by individuals would be a great thing. Unfortunately the masses who are clueless would lose money and then WE would have to pay for their ineptness 2x over again. The only good thing would be people in my age group might actually be able to control their SS retirement funds instead of getting them stolen by the government when they eventually establish a “means test” since they won’t have the money to pay the baby boomers.
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p>And now, Obama wants to remove what little these people pay into SS by giving checks to them. Wonderful!!! Why not randomly give low income earners access to “rich” people’s checking accounts, credit cards and use of their cars and houses. More income redistribution.
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p>To all the people with their heads up their asses, when “whoever” gets elected President, start asking him and Congress to fix Social Security before it melts down!
…88-year-olds should be out in the workforce earning their keep? What’s your brilliant alternative to social security so that the elderly just don’t descend into poverty?
… the answer was cat food.
Do you really think SS can go on as it is now? You both are ignoring it much like the sub-prime warnings were ignored. Again no politician has the guts to do anything about this, nor do you people.
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p>Although your hyperbole was entertaining (88 year old out working, cat food… why not suggest cannibalism while you’re at it).
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p>We have had situations in my town where some elderly on SS could not pay their real estate taxes. Sounds tragic until you understand they are living in $500-900K homes with no mortgages. The towns should allow them to pay their taxes via loan with interest and put a lien on their houses. When they sell the house, the town would get their back taxes before any other payout/inheritance.
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p>There are meals-on-wheels programs, charitable organizations, fuel-assistance programs… I do not believe ANYBODY in this country would ever have to be eating cat food, unless they happen to enjoy it.
… an accurate description of how some elderly got by. Eliminate SS and be ready for 25%+ of the elderly being below the poverty line. I know it sounds like an outrageous stretch, but it only sounds that way because of the success of social security has been around for decades and our collective memory is short.
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p>http://www.povertyinamerica.ps…
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p>If you’re really worried about budgets, it’s all about health care:
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p>
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p>(Emphasis mine)
I don’t think I did but if anyone inferred it let me correct it. I do not favor eliminating Social Security. Although it does need serious reform. BTW, how many charts do you want me to supply showing how SS is A problem (in addition to Medicare, healthcare…)?
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p>Speaking of the growth in healthcare… Does anyone have any data explaining exactly where healthcare costs are coming from and how it breaks out according to age? I have heard remarks about some outrageous percentage of healthcare costs going to people over 65 or maybe being spent in the last 2 years of someone’s life.
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p>If the average family were to add up every single penny they are charged for healthcare services during the year (not what they pay but what they are charged), what would it total? This would include prescriptions (actual total not co-pay), Dr visits, X-rays, lab tests… for the entire family. I’m going to guess I am average (although 5 kids is above average) so my numbers may be close to the real average. My numbers total about $2,500 for all 7 of us. My contribution and my company’s contribution total almost $9,000 for healthcare. If my numbers are typical it sounds like some people are getting some serious medical bills.
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p>Maybe this would be a good start to discuss healthcare reform?
Barack Obama has almost 100 electoral votes to spare and McCain is more than 100 short. Just those states with more than a 10 point spread in Obama’s favor give him 260 out of a necessary 270 electoral votes. Rest assured, however, that nobody on the Democratic side is running out the clock. Obama himself has mentioned our uncanny ability to snatch defeat from the jaws of victory. We will be campaigning harder than ever in the next week.
You folks really are pathetic. Clearly you don’t know how to read or interpret the poll data, how to distinguish between national polling and state polling, and how to make a sound judgment on the momentum in this race.
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p>Big surprise.
…and prior to the “greed is good” years of the neocons, a measure of a person’s worth was not what they spent on themselves, but the libraries, schools, and endowments they created.
is a stain to our Commonwealth
of the republican smear campaign is that they may actually be the ones who give socialism a good name in the usa.
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p>the more they label the obama doctrine as socialism writ large, the more likely that obama administration successes in raising the standard of living for the general public, will get folks to thinking that this socialism stuff isn’t so bad after all.
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p>in fact, they might kinda like it. hell, our parents seem to like social security and medicare alright.
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I suspect that President Obama is going to disappoint those of you who think of the “socialism” thing as a selling point, rather than a somewhat ineffective smear.
… the act of making this campaign about Obama’s alleged liberalism may backfire.
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p>
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p>Some have already done the math and are backpedaling as much as they can:
Whether from the poor to the rich (Republican), the rich to the poor (Christian, socialist, etc.), the civilians to the military, or other combinations, the entire idea of government is forced redistribution of resources.
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p>McCain isn’t advocating free market fundamentalism, he’s advocating anarchy.
You can find all of “Wealth of Nations” at Gutenberg. Here’s the specific bit that Frank quotes above.
Bar Stool Economics
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p>Our Tax System Explained: Bar Stool Economics
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p>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:
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p>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.
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p>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 beer 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.
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p>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 (16% savings).
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p>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 got’ ‘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 important. They didn’t have enough money between all of them for even half of the bill!
And that, ladies and gentlemen, 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.
…will drive up prices and no one will be able to afford beer. Beer sales will drop and major and minor breweries will start to fail. It will require yet another bailout.
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p>Ergo, we must give tax breaks to the rich or we will no longer have access to beer! Won’t someone think of the sober college kids on Commonwealth and Huntington Aves?
I think it’s the other way around.
It’s my imaginary beer economy and I can use any model I choose. Perhaps in anticipation of the rich guys moving over seas, the beer distributor drastically over-estimates the drop in beer demand and radically cuts the supply resulting in a beer shortage? The demand would be quantitatively smaller, but the relative demand compared to the reduced supply would actually be higher on the curve.
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p>Uhm, yeah. That’s what I meant…
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p>(good catch)
Perhaps the tenth man is a lush and drinks 3 pints for every one consumed by the ninth man? It doesn’t say who consumes what quantity of beer so, I mean, how do we know? Maybe the men who drink for free only have a sip and the ninth and tenth man come over and finish the rest?
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p>Perhaps the money saved by the first 4/5 men at the bar will be spent at the business of the ninth and tenth men tomorrow, making those men further wealthier and it is cheaper for the ninth and tenth men to buy a few rounds then to forfeit the other men’s business because they spent all their money at the bar?
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p>The anecdote finishes with the statement “they might start drinking overseas”. Might? Yeah, and they might figure out that they could brew beer at home for cheaper, sell it on the open market, compete with the old bar, and drive prices of beer down to the point where 10 men can drink for pennies instead of $100/night. When we introduce “might”, I guess anything can happen! Who knows, John McCain might win this state’s electoral votes? I don’t have a crystal ball.
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p>Although this “Economics for Dummies”-like explanation is humorous, it hardly demonstrates how “Obama will cause more companies to move headquarters and jobs overseas”. It sounds nice, but if this is what informs people’s economic views on taxes, they gotta be joking.
It seems to me it should be divided proportionally thus:
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p>First four pay nothing.
Fifth person pays $0.80
Sixth person pays $2.40
Seventh person pays $5.60
Eighth person pays $9.60
Ninth person pays $14.40
Tenth person pays $47.20
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p>In other words, divide the $80 in the same proportion as the $100 was.
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p>Back in the real world we should manipulate the tax code in other ways. At very least let’s stop giving additional breaks to those who ship jobs oversees. Regardless of where jobs are or where corporate HQ is, income generated in the United States should be taxed in the United States.
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p>BTW, I’ve never heard anyone attacked simply for being wealthy. Some of us just believe they should contribute fairly to a system that allowed them to get wealthy. Keep in mind that many politicians who propose more progressive rate scales are themselves in the high brackets. Obama will pay more taxes himself under his plan since as President he will make $400,000 per annum. I don’t think he is “attacking” himself for making that much money.
Your story is right on and portraits exactly how people feel who are the payers in the system.
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p>But don’t expect to be changing anyone’s mind on this blog. Many people blog here for self-indulgence and not to really learn. I receive ample criticism for this but the fact is you won’t see any “converts” from even the most constructive discussions.
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p>I wish we could figure out a way to not “show up” when the bill arrives.