Bar Stool Economics

[nathanm]

With the Eurozone in its present condition, there is no currency other than the dollar to diversify with. It's looking increasingly likely that the Germans will continue down the road of austerity and leave the rest of the Eurozone to rot, which can only end in either a shrinking Eurozone or devaluation of the Euro.

There are a lot of fairly smart people thinking that the Euro will be back to parity with the dollar before too long. In that context, deficits really don't matter, no matter how long they continue. The trade deficit certainly won't matter as long as dollars are in demand.

The problem comes in when people holding dollars don't think they'll get anything in return. Right now, they're too worried about the Euro to care.

[Conan71]

The problem comes in when people holding dollars don't think they'll get anything in return. Right now, they're too worried about the Euro to care.

That's a valid point, but it won't stay in disarray forever.  What happens at the point the EU is stabilized and we are still issuing IOU's to pay our government employees though?

Seriously curious how the upset in the Euro is boding for globalists.

[nathanm]

That's a valid point, but it won't stay in disarray forever.  What happens at the point the EU is stabilized and we are still issuing IOU's to pay our government employees though?

Seeing as how the major Euro partners are doing everything in their power to make things worse, that point is a long way off. Germany continues to do what they (falsely) believe best for Germany and is screwing Greece, Ireland, Spain, and Italy in the process. Such is life in a monetary union without a corresponding political union.

As long as demand is poor here in the US, inflation isn't a concern, so dollar holders aren't affected by our issuing more dollars. If anything, we're not printing enough dollars at the moment (hence my continuing calls for further fiscal stimulus to get those dollars in the hands of people who will spend them).

[guido911]

Nate has been cartooned:

[heironymouspasparagus]

So what the rich are saying is that each of those poor people should pay an even BIGGER percentage of their pay as taxes to support the richest.  Keep the subsidies going.

Never mind that everyone under about $250,000 is getting nailed for 30 to 40% already.  Yeah, 16% is just WAY too much for the rich to pay.  After all, they deserve 'special' treatment.  After all, they ARE the only ones who can afford to "make" jobs.  But then, why aren't they??

And then there is the 'hidden' income taxes on everything they buy.  Every service they need.  Every lawyer they hire.  Every fiscal activity they engage in.

And if they can't make it on half what they make, well too bad.  They should have done something different with their lives - something more productive and contribute more to the overall societal effort - like be rich!

[nathanm]

Nate has been cartooned:

Ah, more completely misleading statistics. The rich pay far less of a proportion of their income in sales and other use taxes. High income earners pay less payroll tax. But yeah, if you limit it to the one part of our tax system that's progressive, it looks pretty bad for rich folks. Not.

[heironymouspasparagus]

It's all in the script.  If they stay on script, they think no one will think and realize what a crock it is.

[guido911]

It's all in the script.  If they stay on script, they think no one will think and realize what a crock it is.

Neither you nor Nate get it. The poor are bitching about the rich not paying enough?
Q:  Who in the hel! do they think they are?
A:  Just a bunch of damned ingrates.

[Red Arrow]

The rich pay far less of a proportion of their income in sales and other use taxes.

That's a no-brainer.  If you only spend half your income, you are only paying sales/use tax on half your income.  8% of half your income is only 4% of your income.  The number of dollars paid in sales/use tax is probably still more than you or I will pay. (Unless you are a closet rich guy.)

High income earners pay less payroll tax.

As a percentage, yes.  If you pay 7.5% (or 15% if self employed) up to $100,000 (or whatever the limit is now) and then make a bunch more not subject to payroll tax, of course the percentage will be a smaller part of your total income.  Benefits (at least SS) will be based on your contribution.  You have still paid more dollars in payroll taxes than someone only making say $50,000. I still fear/expect a means test for benefits, meaning if you are rich..... you get no benefits for your contributions.  Where will that level start?  Save for retirement?  You will be screwed.

Someone making $250,000 and paying (overall) 40% will pay $100,000.

Someone making $10,000,000 will (supposedly pay)  $100,000 + (.16 x [$10,000,000 - $250,000]) = $1,660,000., or 16.6% of their gross $10 M. (That would be assuming they can't hide the first $250,000 in a lower bracket.) Even if they only pay a total of 16% of $10,000,000., that's still $1,600,000.

It is not too difficult to believe that all the fat cats paying ONLY 16% of their huge income could be paying a large percentage of the total tax dollars received by the states and feds.  Since I don't have the actual numbers, I'll leave it as a concept which, to me, is believable.

Whether or not the rich should pay 40% of their top dollar is a legitimate subject but to reject outright that they are paying a lot of dollars is wrong. 

[nathanm]

Neither you nor Nate get it. The poor are bitching about the rich not paying enough?
Q:  Who in the hel! do they think they are?
A:  Just a bunch of damned ingrates.

I think it's interesting that you're so hell bent on making other people's problems your own yet constantly lambast liberals for doing the same.

[guido911]

I think it's interesting that you're so hell bent on making other people's problems your own yet constantly lambast liberals for doing the same.

Perhaps you have not paid 6 figures in federal income tax, which is probably more than you would earn in how many years? Perhaps your opinion would change if you did.

[nathanm]

Perhaps you have not paid 6 figures in federal income tax, which is probably more than you would earn in how many years? Perhaps your opinion would change if you did.

Ah, so you are arguing your position because it's best for you, not because it's what's right for our country as a whole. Thanks for clearing that up. You've previously been so coy about your family's income that it wasn't clear if you were promoting what's best for you personally or if you really believed that tax cuts will actually help the economy and thus the the lot of those demographics that are seeing 15-25% unemployment, rather than your 6%.

Sorry that I got it wrong in my last post.

[guido911]

Ah, so you are arguing your position because it's best for you, not because it's what's right for our country as a whole. Thanks for clearing that up. You've previously been so coy about your family's income that it wasn't clear if you were promoting what's best for you personally or if you really believed that tax cuts will actually help the economy and thus the the lot of those demographics that are seeing 15-25% unemployment, rather than your 6%.

Sorry that I got it wrong in my last post.

It's right for our country that I pay more than you--without any extra benefit? Enjoy riding the gravy-train. Seriously, how do you get by knowing that your friends and neighbors pay more, much more, than you do just to live in this country? It's almost as if "Hey, I don't have to sacrifice or work hard. I can let someone else pay the bill."

Here is Nate's favorite commercial:

[Red Arrow]

I think it's interesting that you're so hell bent on making other people's problems your own yet constantly lambast liberals for doing the same.

Are you saying that Guido is acting like a broke guy defending the rich?  I don't remember Guido ever saying he was living on minimum wage.

[Red Arrow]

Ah, so you are arguing your position because it's best for you, not because it's what's right for our country as a whole.
Sorry that I got it wrong in my last post.

I think that anyone making more than $250,000 should give anything above that to the Federal Governent (100% marginal rate) because it's good for the country as a whole.  Really now, who needs more than that to live on.  Think of the $ the feds could get from folks like Warren Buffet, Bill Gates and so many more.  We might even be able to balance the budget.  Wow! What a concept.
\sarcasm

Edit:
Disclaimer: I don't make anywhere near $250,000. (I make a lot less than that for those of you tempted to ask if I make so much more than $250,000 that I am not near it.)