Should we tax the rich?

If the question is “Should the rich be required to pay their fair share of taxes?”, the question answers itself.

“Is it virtuous to use force to take someone’s hard earned money so you can give it to someone else?”

Is it true that all of the wealth of the wealthy is “hard earned”? How much is inherited? How much is a result of luck, such as being born into a family that can provide advantages like an excellent education, or the lack of some expensive health problem? And how much is the result of economic predation? How much is due to Wall Street money-shuffling that adds nothing of value to the well-being of humanity? Consider the income you’re reporting on your 1040. Did your work last year really make the world better by that much? If not, then in what sense did you “earn” it?

On the flip side, is it true that the poverty of the poor is due to a lack of hard work? When I see poor folks working two or three low-paying jobs to string together a living, unable to afford the time or money to get an education that would qualify them for something better, only to see their meager savings confiscated by loan sharks and others who take advantage of their desperation to charge extortionary rates for goods and services that the rich can get cheaper, it’s awfully hard to believe that they deserve their lot.

Steve the Cynic:

As Margaret Thatcher stated in the 1980’s, “What happens when you run out of other peoples money to confiscate”. If we don’t cut spending it really does not matter as there will be no income left to confiscate.

Sorry lefties, I have no interest in working hard to support mark dayton’s fantasies.

Well, we gave Jesse the libertarian four years to work his magic, then Pawlenty the right-wing budget slasher got eight years to do his thing, and look where we ended up. (By the way, Pawlenty is running around the country bragging about how he never compromised, just slashed, so please, let’s not give him a pass on the mess he created.)

Gary Eichten conducted a lengthy interview with Arne Carlson about a week ago, during which Carlson said that unlike the budget crises in other states that started two to three years ago, ours started nearly a decade ago, and he placed responsibility for it squarely at the feet of Pawlenty. Of course, as a moderate Republican, Carlson is probably regarded as a RINO by the right wing of his own party.

If there’s enough fat in state government that, by cutting it, we could make up the $6 billion budget shortfall, then we have to ask the question, what was Pawlenty doing during all those years?

I think we have cut just about as much as we can without doing irreparable harm to a large percentage of our population and to the overall health of our state. We need to raise revenue. And with the concentration of wealth, we know where we have to go to raise it.

David Morris, from the Institute for Local Self Reliance, has pointed out that our country has approximately 400 billionaires, while 37 million Americans have incomes below the poverty line. From 1992 to 2007, the wealthiest 1 percent captured half of the overall economic growth. From 2002 to 2007, their share rose to two-thirds. Not since the years immediately preceding the crash of ’29 and the Great Depression have we seen this kind of disparity between the haves and the have-nots.

We need to nurture again the growth of a middle class and help the working poor so people have money to buy goods and services. That’s how we will get the economy going.

Of course we should tax the rich….what a silly question. Since the Reagan era, they have managed to convince people that they should not be taxed at a higher rate, but that’s exactly what should be taking place. The income tax is a progressive one, and those who have the privilege of making more money, by whatever means, should be required to pay more. Along, with that those high-income earners should be contributing to the Social Security/Medicare Programs on all of their income; there should be no ceiling when they are off scott free on that.

Wade, you’re advocating that we avoid the ditch on the left by jumping deep into the ditch on the right. Your logic leads not merely to plutocracy, but hereditary plutocracy. Shall we go back to the era of the “robber barons” a century ago?

@Steve

So in the interest of avoiding plutocracy, you would advocate for socialism?

I’m all for a “fair tax”. Example: 20% across the board, regardless of income level.

However I see no reason I should have to pay 65% of my income to tax just because I’m smarter, better educated, luckier, more ambitious, or whatever combination of qualities allowed me to achieve a high level of success. While a poor person pays almost 0%.

What if that poor person is simply lazy? Why are they entitled to anything?

Another example, a good friend of mine made 77K last year in income. He’s paying almost $0 in taxes because he has so many business deductions, personal deductions, etc. That he deducted his income down to nothing. He was able to do that because he’s ambitious, smart and crafty. It seems to me that a lot of high income earners are in a similar position.

Let’s do away with all this deduction stuff and just do a “fair tax”. Seems to me this would fix the budget issues.

The definition of “rich” is too low; for a two income family $150,000 is not rich. A couple late in their careers could easily meet this threshold and at a time when they need to be saving for retirement so they are not a burden on society over the next 20—25 years. I suspect this threshold was chosen to “meet” the budget not because it made sense.

A “yes” or “no” is too simplistic. When I hear that Minnesota will have the highest state tax rate, alarms go off. Be ware of unintended consequences! “Rich” people have choices; will more rich people make Florida or Texas their permanent residence? Will more taxes on the household making $175,000 result in less charitable contributions?

Neither state nor Federal governments have demonstrated the ability to make laws that actually achieve the intended results. Could the highest state tax rate result in less net revenue?

Laws with a noble purpose are often corrupted during negotiations resulting in unintended consequence. All systems seek equilibrium. The so called banking reform has driven banks to recover their losses through Machiavellian fees and rules. These impact lower income earners, who can least afford them, more. The healthcare reform allows a 26 year old to stay on their parent’s employers plan even if they are eligible to be covered by their own employer. This decreases one business’s cost at the expense of another. Employers with the best healthcare are the ones adversely impacted; is this fair? Will business’s cut back their healthcare programs as a result?

@ Clark & Wade: Don’t bother trying to employ reason with the “looters” (Steve the Cynic’s word, not mine) that dominate this thread guys, it’s no use. There are makers and there are takers in this world, and you can tell quite easily where one stands when you disect their logic.

btw….The way the question is posed here somehow implies that the rich are not currently taxed, which is patently false, wtf is that about anyway?

@ Steve the Cynic: Let’s talk about the “general Welfare” clause a bit, shall we? Do you really think the founders had in mind what I presume is your looter’s definition of “welfare” when they wrote those words in the preamble (and Art I Sect 8)? Are you sure they weren’t referring to the “general welfare” in the context of doing what was right and necessary to preserve and defend the Union, and not to help/feed/clothe any one individual? Did public education fail you so badly that you can’t even read or understand the words in proper context? It is unfortunate that the words can be so easily misconstrued, but not surprising considering how much they’ve been misinterpreted and stretched beyond the founder’s imaginations by previous and current administrations, i.e. FDR, LBJ, and BHO. Should the government help those who cannot help themselves? That is a legitimate question. Should the goverment help those who WILL not help themselves? That is an entirely different question, and it happens to be the one we face today. My answer is a resounding NO. Good day.

Steve the Cynic

Easy there turbo. I did not intend on mischaracterizing your comments. I simply forgot you had made that previous comment.

Quoting you: “The government is not them, and taxation is not theft. The government is us, and taxation is how we pool our resources fairly to provide for our common well-being.”

This needs definition. Should we all pay taxes into the “pool” for the road we use, fire department and law enforcement, parks, etc? Yes.

Should I pay taxes into the “pool” so some lazy person can have cable, a cell phone, eat prime rib, drink booze and smoke? NO!

Should I pay taxes so some senator or legislator can have a unbelievable health plan and/or enjoy an unlimited supply of cash for wasteful spending? NO!

“The government is us, and taxation is how we pool our resources fairly to provide for our common well-being.”

What’s fair about progressive taxation? Fair is we all pay the same percentage of tax. Be it based on spending or income.

Short and sweet, YES. At or above the rate the rest of us have to pay.

This is a poorly-worded question. I think almost everyone is currently taxed, including the rich. So, YES.

I think the intended question is really: should the tax burden of the wealthy increase in order to balance the budget? That seems to be the theme of arguments already on-going anyway. To that, I also say yes, and for this reason: If a small proportion of people have to sacrifice a little more in order to help our county or state, so-be-it. That is the argument when we go to war (soldiers and their families sacrificing their time and efforts, and some, their lives), so why can’t that argument hold in this case? Seems pretty selfish to me.

Whatever happened to coming to the call when your country needs you, whatever that need may be?

I just have a couple of things to add:

Income inequality has been concentrating for a long time. It’s not materially different for an executive board of a company to increase CEO pay astronomically while real wages for average workers declines than it is for government to fiddle with marginal tax rates. Both involve people who have to follow along regarding a shift in wealth.

Except that the wealthy have more influence in government than poor or even average citizens. They have a greater ability to select and assist candidates and control political discourse. Since they own the government in a way that no one else does (or can), why don’t they have at least slightly greater ownership of the deficits we’re facing?

As for working harder, the average American is significantly more productive now than thirty years ago. And yet, real wages have declined for them. Do you think that CEOs work harder now than thirty years ago? If so, is the increase enough to justify the increases, rather than the decline that most have faced?

How many people believe that the only impoverished people are lazy people, and that everyone who works hard succeeds? If you are one, how many low income people do you know, and how well do you know their finances? Of course there are some people who just don’t want to work, and some people who game the welfare system, but is that portion great enough to justify slashing aid, rather than reforming it?

And this last one is for Wade:

Your friend, the one who paid $0 in taxes on his $77,000 in income. Why is it that when he takes advantage of the rules for his own benefit he’s “crafty” and this is acceptable, but when someone near the poverty line does it it’s a travesty and they deserve a penalty?

Not a very balanced question the way you put it. The middle class got clobbered during the Pawlenty years with massive increased property taxes. Now that we have a Governor who does not see the job as a stepping stone to a Presidential run, can will go back to adult style politics? It may not be be pretty to watch, but meeting in the middle is how divided government usually works. Governor Dayton has offered up a balanced approach to a serious problem. Now it’s up to the GOP to offer up their approach. I trust it will be as balanced and reality based. We can only hope.

Wade, are we starting to have a thoughtful conversation, or is that wishful thinking on my part? It sounds like we agree that a fair pooling of resources through taxation to pay for necessary public services is just and right. What we may disagree about is what’s “fair” and what’s “necessary,” and when or whether it’s appropriate to levy taxes for things that improve the common good but may not be strictly necessary. I agree that taxing people to support those who will not work to support themselves is bad public policy. I think you agree that privatizing law enforcement would be a bad idea.

On the question of tax fairness, there are divergent opinions. You argue for a “flat tax.” In point of fact, Minnesota’s taxes are currently regressive. Maybe that’s offset by the progressivity of federal income taxes, or maybe not. There’s a case to be made that regressive state taxes are fair, because state services disproportionately benefit the poor and middle class. In countries that have single-payer health care (like Canada) it’s usually paid for by a regressive tax (like Canada’s GST). Our payroll taxes are intentionally regressive, because they pay for a progressive benefit– Social Security. On the other hand, there’s also a case to be made that having society be civilized, with no one living in squalor and desperate poverty, benefits the rich so much that progressive taxes to pay for social services is indeed fair.

Unfortunately, rational discussions of issues like these are currently impossible, because there’s too much ideological sloganeering, because extreme partisans think it’s more important to win the shouting match than to come to a reasonable compromise. (And the poor wording of today’s question only makes the problem worse.)

Yes. Progressive taxes are the fairest.

In the “good old days” of the 1950s that the GOP so likes to hark back to, the Federal top marginal income tax rate was 90%! Now it’s 35%. In the 1960s and 70s it was 70%.

The GOP threw themselves in front of the train to prevent the top 2% of households from getting a 5% income tax increase. Good thing they are concerned about average Americans!

@ Steve the Cynic

“Wade, are we starting to have a thoughtful conversation”

To bad the clowns we elected can’t do the same.

“To bad the clowns we elected can’t do the same.

Maybe it’s time we stop electing clowns.

@CHS

You may be right that the rich pay a large % of the taxes, but they also have the majority of the wealth.

The top 1% richest people in the country own 42-45% of the wealth. The distance in wealth between the rich and the poor is a gap that is widening dramatically.

CEOs used to make 5 times that of the lowest paid employee. Now they make up to 300 times.

We’re creating a class system. The American dream is possible for a very small number of Americans.

It’s not about money, it’s about humanity. It’s great to go through life with the mindset of “Well, I got mine!” Unfortunately, it’s unsustainable.

“Let them eat cake.”

your question: “Should we tax the rich? ”

my answer: Yes.

We should also tax every other income bracket except those making under $30,000 a year. in fact we should just have a flat tax, that would make it all easier and reduce loopholes.

side note: at the end of the 19th century and going into the 20th only those people making over $250,000 a year were taxed. Correct me if i am wrong, but i believe that is correct.

I don’t understand this concept that if we tax the rich more, that money goes into the pockets of the poor. It’s goes into the need of the state. This isn’t a social change.

We want things like safe roads, competent schools with competent teachers, a fair work environment, a just judicial system. This isn’t provided for free. And although the rich may not utilize it as much as the poor, situations become more and more dire as the environment becomes worse.

Putting money into government programs, health, and education improves the lives of the poor, which in turn provides profits for the rich.

These aren’t social changes, they’re basic human interests.

Much of my social change comment was based on the comments related to the wage gap, wage stagnation, housing and food costs, etc. Those ARE social issues.

I’m all for properly funding our educational system and our public safety, our roads and transportation, etc. I just think before the “tax the rich” banner is flying too high we need to take a serious look at REAL tax reform and what most of our money goes to.

In our state the Big 3 account for the lion’s share of our budget. Those are: Education, Local Government Aid (LGA) and Health and Human Services (HHS). Arguing about any budget items without addressing those is like pissing on a brush fire.

Last I checked our budget shortfall was about 6 billion on about 33-36 billion in projected spending, leaving us around 15-18% short. To just assume that we can raise an additional 15-18% on our budget by simply taxing the rich without taking a serious look at the whole picture seems mind boggling to me, but that is what I seem to be hearing from most people.

So of those three, everyone seems to agree schools, police/fire (mostly paid by LGA), and roads are good and we should all pay for it according to our ability…. which leaves the 3rd rail of our state politics: HHS.

“..how much pain are the rich willing to accept for the good of the state?”

A lot more than I would guess most people are giving them credit for. However, I don’t think it’s too much to ask in return that we take a serious look at reforming some of our institutions and our tax code. By and large I believe that people are willing able and ready to pay their ‘fair’ share of taxes, so long as it’s clear and transparent that the money is going to worthwhile and efficient uses. I haven’t seen a genuine attempt at worthwhile reforms from anyone in the legislature at this point on any topic. Instead we get bills for drug testing welfare recipients, or press conferences condemning the others for being against child protection.

“The rich should pay at least the same percentage of their income as the middle class pays. ”

This type of comment confuses me, because they already are, in fact in many cases a higher percentage, depending on what you define as “middle class” and “rich.” Seems like what everyone is upset about is that they have more left over when they are done paying their share.

CHS, CHS, CHS……you’re totally missing the point here. As demonstrated in the asinine way the question was posed, this thread was supposed to be all about class warfare and finally getting the rich to pay taxes, the implication being that they currently don’t. Why not just get on board already? We liberals are generally very tolerant people, we tolerate just about anything and any view except those that differ from ours.

Perhaps a better question would have been: “Should we axe the rich?” To which the answer would be “Hell Yes!” Right? Can I get a high five, people!? Think about it….they’re such “greedy hoarders” they don’t deserve to live anyway, so we axe them and take their money. Are you with me Steve the Cynic? How ’bout you Ted? Jordan? Hello? C’mon, let the looting begin! Hoorah!

I’ve not once argued that taxes shouldn’t be raised, and I hope that point hasn’t been missed. I just patently reject the assumption that just raising the tax rate on the wealthiest will solve our problems, because it won’t. Odd that trying to be voice of pragmatism and advocating for realistic fair approaches gets me flamed.

Do I feel that the wealthier segment can pay a higher share, sure they can. Should they? Probably, but let’s take a good look at everything while we do it, because you can bet if we don’t the fight gets even uglier from here out.

Also, comments like “If you can afford _____ your taxes aren’t high enough” are ridiculous. There will always be people that make more money than you (and certainly me), and to imply that society should cap income through taxation is the type of attitude that creates this “class warfare” in the first place.

@CHS

I couldn’t have put that better myself. Where we have agreement, there can be compromise. I only hope our men and women in the legislature can also come to some sort of realistic, pragmatic, and fair solution.

And by the way, if the general fund continues to be used as the measure for determining the size of government, Minnesota’s government has shrunk 13% over the last two years. So I really don’t want to hear anyone complain about the size of our state’s government. Therefore, to the Tom and Daisy Buchanans of Minnesota, pay the extra 3% and shut the hell up.

Should we tax the poor? Everyone should pay the SAME percentage. Anything else would be undemocratic and unfair.

@Dripping with Sarcasm

If you have any ambitions of making it big as a satirist, may I suggest you keep your day job.

I think Governor Dayton’s proposed budget is a reasonable response to the deficit. I would be elated to make $150,000 a year and pay a measly $161 extra dollars. I would be even more elated to be making a million EVERY YEAR, living in a 2 million dollar home, and have to pay only an additional $48,000 dollar.

And notice that it isn’t even the rich who are whining. It’s mostly conservatives who won’t even be affected by the tax increase who are whining on their behalf!

The plutocracy leeches the working class for its wealth. We can curse the rich all day and night. But what does anyone do about it?….continue working substandard wages. No longer do americans dare strike or protest . Taxing the rich is a way of begging back what has been stolen. Intimidation and extortion are their tools, that part of the american dream which a weak public drowns out with Sunday liquor sales.

Let the rich divest their billions to Dakar. Let them leave so we live once more.

The rich need to start paying back all the tax breaks they’ve taken over the past 30 years plus interest! They and their so-called conservative legislators want all the goods and services without paying for them. Why do large corporations and the wealthy think they are entitled to loot the treasury? It’s high time the middle class wises up & starts electing officials who support our democratic ideals and equitable taxation. Quit voting for more welfare for the rich!!!

Most of the people posting here are simply jealous of people who make more than them. Should we tax the rich? Of course. Should we tax them a much higher percentage than everybody else? No..Why should we punish success? Are you upset that the CEo of a major corporation makes more than you? Tough luck…I guess you should have studied harder, or got your MBA, or worked your way up through a corporation the way he did. Why should you get his money? He earned it, not you. What about the corporation itself? Should you put them to the fire and make up for your crappy leaders overspending? Sure, go right ahead, and then they will pack up their plant and take those thousands of jobs to another State, so instead of getting the tax money from them you can try to gut them and end up with nothing…smart thinking. Take a look at the thousands of companies that have left Wisconsin in the past few years..are you still wondering why there is a problem in Wisconsin? The multi-million dollar corporation known as the Union has run them out of town…Economy bad? So what we want our raises…Pay for our health care like everyone else? No way, we are a union….They claim to represent the little guy when in fact they are blackmailing companies, and when the companies say the heck with it and leave, the head of the union isn’t suffering, the thousands of unemployed workers are. So go ahead, tax those rich until they leave, tax those corporations until they leave…Then you can have your nice little communist society where everyone earns the same amount..$0.

Should we tax anyone? If so, who? The question is really how much should we tax the rich. The answer is a lot more than we are. There are huge corporations paying 0 taxes and even getting rebates, including oil companies like BP and ExxonMobil and bailed-out banks like Bank of America. How much of the $220 million the Federal Reserve is paying the wives of Morgan Stanley should they pay in taxes?

Maybe MPR’s news staff could ask a few tough questions of Republicans rather than simply repeating their talking points.