I posted this on another thread, but maybe it will be interesting on this one, too.
The way our progressive tax system works, the more successful you are, the more you have to give away (in taxes) to help the people who are not as successful. I am not too happy about it because I work hard and I take a lot of personal responsibility to have the chance to earn what I do...
How many of "you" could or would work 40+ hours a week and have the potential to earn NOTHING? Because I can work hours on end and not make a cent if what I'm working on doesn't "work". While for me the sky is the limit, the floor is negative zero and I do mean negative. Even if I do not earn for a period of time, if I want the potential to earn later, guess what? I have salaries to pay, rent on a swanky office suite, marketing expenses, utilities, E&O insurance, E-T-C...................... I have gone through some really tight times that meant spending from what I've saved (and my father, too, we are partners) to keep things going over rough spots in the business.
The idea of our progressive tax system is based on the fact that those who benefit the most from living in this Nation contribute the most in taxation. A flat tax system would still have the people who earn more paying more but it seems fair for the percentage to be the same in my opinion.
In our Nation, the top 25% of tax payers pay for 84% of the total Federal Tax burden. If your family's adjust gross income is only around $58,000/year, YOU are in the top 25%. How does it feel to be paying most of the taxes?
Anyway, a client sent this to me and I like it so am going to share it (again)
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Bar Stool Economics
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:
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. 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 on 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. 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).
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!" "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, boys and girls, 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.
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(edit for spelling)
OH!
