Monday, October 20, 2008

The market and McCain

I notice when the point spread narrows (I think the latest is about 3-4), the market improves. Investors seem very afraid of Obama and his socialist tax plans. Imagine. No one wants to risk growing their business if they will just be taxed more for their efforts. Of course, it could go the way of FDR. The market was recovering in the early 1930s and then he killed the economy for the duration of the decade with his alphabet soup programs keeping up the high unemployment rate.
Posted by Norma at 10/20/2008 10:01:00 AM
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3 comments:

PG said...

Your claim of Obama's having "socialist tax plans" seems at odds with your prior definition of socialist in your comment to your post "Hillary Clinton's legs."

A socialist advocates government control of or collective ownership of the means of production or distribution of goods.

In what way does Obama's tax plan advocate government control or collective ownership of either production or distribution of goods?

Also, any tax system that doesn't have everyone pay the same flat fee obligates people to pay more if they succeed in making more money. Even the "flat tax" advocated by Republican primary losers like Forbes and Huckabee -- and NOT advocated by McCain, whose tax plan continues to have people pay at different rates based on income -- will force people with more money to pay more in taxes.

Suppose you are a business owner making $100k a year living under a flat tax system where you are taxed 25%. You have to pay $25k. Now imagine that you work hard and make $200k the next year. Even under a "flat tax," where the rate remains at 25%, you will have to pay twice as much in taxes because you have made twice as much money.

So are you, like Joe the Plumber, advocating that we go to a flat fee system of taxation in which everyone pays the same amount? It's pretty much the only way to avoid the "socialism" of having people pay different amounts based on their material success.

10/23/2008 6:48 PM
Norma said...

If you are saying we already have many socialist elements in our tax system, you are correct. However, I think you've misunderstood flat tax. Same rate isn't same amount. A 10% tax on the person earning $30,000, and 10% tax on the person earning $300,000 is the same rate but not the same amount, but it is fair. The gov't probably comes out ahead, plus the wealthier person has more left over to invest and grow his company to employ more, which brings in more taxes.

"In tax terms, "flat" simply means everybody pays the same rate; there is no graduation in the rate structure. If you graph income levels versus tax rates, you get a "flat" line. The "flat tax" is a tax on income with a single uniform rate and a standard deduction."

If we both go to the theater and sit in the 3rd row, should you pay $50 and me $10 because you earn more? Now, some do this and call it charity (the $40 being a donation); some candidates would require it and call it "fair."

We've seen communism and planned economies fail miserably. Even the subprime mess we have now is a result of government fiddling in the mortgage market trying to make it "fair" instead of a sensible investment for responsible people.

10/23/2008 8:12 PM
PG said...

10% tax on the person earning $30,000, and 10% tax on the person earning $300,000 is the same rate but not the same amount, but it is fair.

OK, so charging people based on the amount of money they make, so long as it is a consistent percentage, is fair under your beliefs.

If we both go to the theater and sit in the 3rd row, should you pay $50 and me $10 because you earn more?

If I earn 5 times more than you do, and the theater charges fees the way you consider to be "fair" for government to charge taxes, then yes of course I should pay five times more for a ticket.

You don't explain why a flat rate, under which I pay more taxes than you do, is "fair." If you truly believe that it is unfair to charge people more based on the amount of money they make, then even the flat rate tax is unfair and the only fair tax is one that is the same amount paid by everybody.

I understand what a flat tax is, which is why I used the term "flat fee" to describe a tax system that would be like the one you think is fair for the movies. Every pays the same fee at the movies; they don't pay the same rate as a proportion of their income. Why is it fair for the government to charge a flat *rate*, but unfair for the movie theater to do the same?

10/23/2008 11:22 PM

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