Lion of the Blogosphere

Lion’s tax plan

There’s nothing fundamentally wrong with our tax system. The basic rules for determining what’s income have evolved over the last century and there’s no reason to change that.

I would close loopholes, and I would simplify the tax code by removing as many special deductions and exemptions as possible, and some of the increased revenue from that should be used to lower tax rates for middle-class people, but there’s no reason at this time to change the tax rates for rich people. Rich people have been doing great for the last three decades and they can certainly afford to pay the current tax rates, even minus the loopholes.

Written by Lion of the Blogosphere

September 16, 2015 at 1:25 pm

Posted in Taxes

30 Responses

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  1. The bush tax cuts, as modified by Obama, are what’s Wrong with the system.

    A flat tax with few exceptions and exemptions is best, and a progressive system where the poor get welfare through the tax system (subsidizing Walmart’s paying of sub living waves) but the rich don’t pay taxes either (high nominal rates but plenty of exemptions) is the worst.

    The middle class guys who need to earn enough money to attract a woman, because they don’t have high status, are the ones getting killed today by taxes. Society needs these men to contribute, not drop out of society and become either bad boys or parasitic leeches.


    September 16, 2015 at 1:36 pm

    • The middle class guys who need to earn enough money to attract a woman, because they don’t have high status, are the ones getting killed today by taxes.

      Nice guys finish last in America. They also make up, the bulk of the constituents of the Publican party.


      September 16, 2015 at 1:54 pm

  2. Agree that nothing needs to be done to reduce taxes on the wealthy. In fact, they should be increased a lot on the super-wealthy, and I don’t care if they already pay most of the taxes. Wealth has skewed far too much to the top of the pyramid. And if that billionaire CEO realizes that his next incremental dollar is going to be taxed at 95%, maybe he won’t be so quick to off-shore another 1,000 jobs so that his stock goes up a few bucks.

    The tax system, though, is broken on the lower end. Too many people pay nothing or close to nothing, and the Earned Income Tax Credit (hah! “earned”) is a sick joke. The problem with taxes being too low is that it provides no incentive to vote against gimmedats. If you see the money disappearing from your pay every week you might think, “hmmmm, do I really want more immigrants to support?” or whatever else.

    That said, anyone receiving the bulk of their living expenses from the government shouldn’t get to vote anyway, but that’s a different problem.


    September 16, 2015 at 1:41 pm

    • However, there are a lot of things wrong, being an upper middle class resident in NYC, and paying your share of taxes. Anyone who has taxable income in NYC, is basically subsidizing the Tyrones, Miguels, Shaniquas and Jezebels, who attend public schools and live in public housing.


      September 16, 2015 at 2:08 pm

      • “Anyone who has taxable income in NYC, is basically subsidizing the Tyrones, Miguels, Shaniquas and Jezebels, who attend public schools and live in public housing.”

        This reinforces my belief that people object to welfare primarily because they want to support their own tribes. And there’s nothing wrong with that. But it does cripple mainstream conservatism when they feel obliged to pretend that their tribal interests are actually universal principles.


        September 16, 2015 at 2:46 pm

      • Jesse – Yes and No. NYC is a terrible place, in terms of the non-White demographic. Low IQ undesirables, who will never assimilate into fully functional citizens. Why should real working people subsidize these animals? They are a bane to society!


        September 17, 2015 at 7:58 pm

    • “That said, anyone receiving the bulk of their living expenses from the government shouldn’t get to vote anyway, but that’s a different problem.”

      That’s the way the voting was originally set up. Of course, people didn’t get welfare 200 years ago. But a certain net worth was required to vote. Which amounts to the same thing because it keeps people from voting themselves other people’s money.


      September 16, 2015 at 3:06 pm

    • Agree absolutely, the system is now top-and-bottom against the middle. The lower 50% pay nothing in income taxes, and in fact are net consumers of tax dollars. The top 2% have enough money that they don’t need to be concerned with paying a 39.6% top marginal rate, since most of their income is in the form of dividends and capital gains. The Democrats have the best of both possible worlds, rich donors and bought-and-paid-for voters. The Republicans have painted themselves into a corner, because if they were to suggest something sensible, like the idea that everybody should have some “skin in the game,” i.e. pay some income tax, they would be attacked by the media and the Democrats (redundant, yes, I know) as being anti-poor, anti-minority, anti-single moms, you name it.

      Sgt. Joe Friday

      September 16, 2015 at 6:27 pm

  3. Flat tax worked our well in Russia. Today, I pay no tax, but I would rather pay 13%, like in Russia, and be legit, but there is no way I’m paying crazy taxes until I’m netting 200,000. Im not motivated to work if I have to give away so much of my income. This is what practical people do in this city.


    September 16, 2015 at 1:57 pm

    • Paying no taxes is a dangerous game, Yakov. The IRS is very powerful in this country and the tax man has locked up a fair number of very powerful people.

      If you reported something and it turned out not to be enough, you could fix it later and have a reasonable argument that you made a sincere effort. If you pay nothing at all, I wouldn’t want to represent you legally. “Aw, gee, since when did taxes become a thing?”

      I assume you ask for cash from all your customers, making it really obvious what you are doing. All it would take is one high-minded SWPL and you’d be in big trouble. If you suddenly stop commenting, we’ll assume you are sitting in the pokey.


      September 16, 2015 at 3:12 pm

      • I never ask real Americans for cash, it would be humiliating for me to do so. I take checks and launder them. In the immigrant community and among ethnic minorities the attitudes are different and we speak the same language. Now, nobody in their right mind will go after me and if I stop commenting you can assume that I finally went completely on my own and am too busy minting money.
        All tradesmen that I know in the city do pretty much the same thing.


        September 16, 2015 at 5:31 pm

      • Tradesmen in San Diego are a lot more honest. I’ve asked a few if they have “cash discounts” and they always said no.

        This is one reason I am glad California just raised its gas tax. They did it in a sneaky way, by doing cap and trade that makes gas refiners pay a lot of extra money, but not a set amount that can be easily figured out. No way for dishonest immigrants like Yakov to avoid paying gas taxes.


        September 16, 2015 at 7:58 pm

      • “In the immigrant community and among ethnic minorities the attitudes are different and we speak the same language”

        Yakov is doing the tax dodging Americans won’t do. Actually, this sort of shenanigans is par for the course among immigrant communities, making even more of a joke out of the “immigrants pay more in taxes than they get” line one sometimes hears. The amount of tax dodging, welfare scamming, Medicaid defrauding, etc. that goes on with immigrants is simply staggering. Our high-trust civilization is a fat, stupid target for low-trust, clannish immigrants.


        September 16, 2015 at 8:20 pm

      • You all make valid points. I find it hard to beleive that in San Diego, which is a city full of Hispanics, tradesmen don’t give cash discounts. Lot, if you think it’s dishonest, why you keep asking for them?


        Some immigrant communities, like Russian Jews and Chinese or Koreans adapt to the American ways in a generation or two at most. However, the ones that remain in their ethnic enclaves remain more ‘ethnic’.

        There is also the nature of the business itself. The fact that the business is operated with a lower tax structure or no tax structure is build into the price of the services. The inflated cost of living reflects the government programs such as Medicaid, Food stamps and section 8. In an environment like this there is no other way of making it.

        In fact, I think this is pretty honest. You do a first class job and keep all your money. You didn’t take anything from anybody. Compare it to doctors who perform unnecessary procedures and bill insurance companies or the government. What’s better? My daughter needed a blood test for summer camp, the doctor billed insurance for $900, but skipped the deductible. Lawyers are crooks, accountants are crooks, insurance agents are crooks, doctors are crooks, dentists are crooks. But it rubs them the wrong way to pay cash? No problem, I’ll take a check, lol. Now as any business grows it has to become legit and you start avoiding taxes the legal way, but the final goal and result is often the same. There is a joke that goes like this: ‘I can tell you how I made all my millions except for the first one’. This is just how life is.

        As far as being clanish, sure your family, tribe and nation are the most important things, not the government or strangers who won’t do anything for you! The government is important, but not as important. So a chap should live in poverty because he has to pay taxes? This makes no sense. Let him get ahead and than he’ll pay. This is simple.

        This is funny. I was with friends in an Indian restaurant last week, so the owner walked over and asked us if I could pay cash. He discerned that we understand the same language. Of course it was no problem to oblige. You are not gonna ask a real American to pay cash in a restaurant, but we aren’t the real Americans, nor do we pretend to be.


        I have no idea how you cheat on a gas tax and what’s it about. I don’t think there is such a thing in NYC.


        September 16, 2015 at 11:01 pm

  4. People need to understand functional finance and modern monetary theory. Taxes should not be seen as a way to raise revenue, because the US government as the sole issuer of its own sovereign currency has a literally unlimited supply of US dollars. Taxes are needed to establish demand for the currency (you need to currency to pay taxes, which everyone has to pay) or otherwise should be used as a macroeconomic tool. Taxes should be generally low — except, in my opinion, for a larger estate tax in order to curb the economic and political power of inter-generational wealth — and should be raised when inflation is getting too high to take money out of the system and lowered when the economy is slowing down in order to stimulate spending and investment.

    The taxes on the rich can probably stay the same because if they were cut we wouldn’t get any benefit, the rich would just feel better about themselves. We’ve cut taxes for the rich plenty of times in the last couple decades and employment has not gone up like it was “supposed” to. Tax policy should be decided based on what effect it will have on the real economy, so top rate taxes can stay the same. Taxes on non-rich people though should be cut dramatically. Corporate taxes should be cut significantly also.


    September 16, 2015 at 2:17 pm

  5. Why not tax rich people more? They betray us on issues like open borders. Money is speech, and they have all of it. Why should we allow them to have the funds to displace us? If billionaires were more patriotic, it would be a different story. It terms of political speech, we need an even playing field. Leaving comments on blogs isn’t parity.


    September 16, 2015 at 2:27 pm

  6. I’ve never understood why so many conservatives think a flat tax is such a cure-all. It’s not the rates that are complicated, it’s all the credits, deductions, adjustments, accelerated depreciation, AMT, exceptions and exclusions and so forth that make the system complex.

    Mrs Stitch

    September 16, 2015 at 2:46 pm

    • It’s not just any flat tax, it’s the low flat tax that has the appeal. Like Russia – 13% and I pay tommorow with everyone else, but if the government wants to take 50 cents out of my dollar, the can go to hell.


      September 16, 2015 at 5:34 pm

      • That’s the Russian federal income tax. There are other additional deductions – in practice it’s often twice that, or more!

        Viscount Douchenozzlé

        September 17, 2015 at 3:14 am

    • They don’t actually think its the only way to reduce complexity they just say it is to trick gullible people into supporting reducing taxes on rich people. It’s totally idiotic.

      Lloyd Llewellyn

      September 17, 2015 at 12:56 am

    • “I’ve never understood why so many conservatives think a flat tax is such a cure-all.”

      Carson had the answer…it’s a Biblical tithe.

      Mike Street Station

      September 17, 2015 at 9:09 am

  7. You’ve previously argued for a guaranteed minimum income. I think a negative income tax would be a good way to do that while solving the problems inherent in welfare.


    September 16, 2015 at 3:10 pm

    • viscount flyte

      September 16, 2015 at 5:45 pm

      • Friedman’s discussion had nothing to do with whether socialism works or not. It merely discussed the economic disincentives welfare has for people to work and how a negative income tax corrects that. Next time know what’s being discussed before responding.


        September 16, 2015 at 7:16 pm

      • How about no taxes on wages, that are deemed minimum on a 40hr/work week, by gov’t standards? That’ll garner a lot of support.


        September 16, 2015 at 10:14 pm

      • JS — The negative income tax would do that… and more. I don’t think you watched the video.


        September 17, 2015 at 9:17 am

    • Libertarians like Friedman have giant blind spots in terms of understanding humanity. They just do not understand the mass of humanity that is not smart like them. Examples:

      (1) Negative income tax would never work because poor people blow the money on unimportant stuff and then still need welfare for all of the essentials. This is why all the programs exist. They tried just giving money.
      (2) If drugs are legal, poor people become addicts because they lack the discipline of smart people.
      (3) If the police go easy, many people are merely emboldened.
      (4) When society has lax sexual norms, low-time-preference people mess up en masse.
      (5) If borders are open… moochers from around the world will flood in, and by the way vote against liberty.


      September 17, 2015 at 9:16 am

  8. I would eliminate the mortgage deduction – it only serves to inflate the price of housing, so there are no net savings in aggregate -, but I would do it gradually. I would stagger the elimination over a thirty year period. Knock off 3% of the deduction per year. To eliminate the deduction immediately would cause such havoc to the finances of homeowners that it could never be seriously considered.


    September 16, 2015 at 5:55 pm

    • “I would eliminate the mortgage deduction – it only serves to inflate the price of housing, so there are no net savings in aggregate”

      Not true at all. First of all, only some people benefit. The rich usually pay cash for housing. Investors generally max out the benefit with a second house, but it doesn’t help them beyond that. Finally, it helps people the most in the early years of the mortgage. So the biggest benefit is for younger upper middle class people, the ones who we want to subsidize the housing expenses since they will be the ones producing IQ>110 future Americans.


      September 16, 2015 at 8:03 pm

  9. That’s what Reagan did, twice. He had three major tax laws. The 1981 was mainly about cutting rates. But they went down so much they had to make up for some of it, so in 1982 they raised money but keeping rates the same but killing a ton of deductions. Finally, the 1986 law cut rates all the way down to 28% for both income and capital gains, and removed even more deductions. The biggest deduction eliminations were relating to real estate and/or passive losses.

    Here are some details from Wikipedia:

    The top tax rate for individuals was lowered from 50% to 28% while the bottom rate was raised from 11% to 15%.[4] Many lower level tax brackets were consolidated, and the upper income level of the bottom rate (married filing jointly) was increased from $5,720/year to $29,750/year. This package ultimately consolidated tax brackets from fifteen levels of income to four levels of income.

    interest on consumer loans such as credit card debt was no longer deductible. An existing provision in the tax code, called Income Averaging, which reduced taxes for those only recently making a much higher salary than before, was eliminated (although later partially reinstated, for farmers in 1997 and for fishermen in 2004).

    The Individual Retirement Account (IRA) deduction was severely restricted.

    Depreciation deductions were also curtailed.

    Defined contribution (DC) pension contributions were curtailed. The law prior to TRA86 was that DC pension limits were the lesser of 25% of compensation or $30,000. This could be accomplished by any combination of elective deferrals and profit sharing contributions. TRA86 introduced an elective deferral limit of $7000, indexed to inflation.

    The act required people claiming children as dependents on their tax returns to obtain and list a Social Security number for every claimed child, to verify the child’s existence. Before this act, parents claiming tax deductions were on the honor system not to lie about the number of children they supported. The requirement was phased in, and initially Social Security numbers were required only for children over the age of 5. During the first year, this anti-fraud change resulted in seven million fewer dependents being claimed. It is believed the disappearing dependents were either children that never existed, tax deductions improperly claimed by non-custodial parents,[7] or pets.

    the Tax Reform Act of 1986 greatly expanded the AMT to aim at a different set of deductions that most Americans receive. Things like the personal exemption, state and local taxes, the standard deduction, private activity bond interest, certain expenses like union dues and even some medical costs for the seriously ill could now trigger the AMT.

    By enacting 26 U.S.C. § 469 (relating to limitations on deductions for passive activity losses and limitations on passive activity credits) to remove many tax shelters, especially for real estate investments, the Act significantly decreased the value of many such investments which had been held more for their tax-advantaged status than for their inherent profitability.


    September 16, 2015 at 7:51 pm

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