OT: Rating the President

[Slick]

Originally posted by Imperator Fyron:
Only "normal" progressive income taxes discourage getting pay raises. Flat taxes and reasonable progressive income taxes (as in, the richest pay maybe 2x as much as the poorest that do not qualify for tax exemption for being below a poverty line) do not discourage that.

quote:

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Let's see... less spending, more work & more saving... Isn't that a system that would make the economy strong?

That is a recipe for disaster. Spending is what makes the economy run. If people horde money, workers lose jobs. Store employees lose jobs. Everyone suffers.

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You should read some basic economics sometime.

[Fyron]

Why, because I know what a progressive tax system is and that hording money causes economic problems?

[Askan Nightbringer]

Originally posted by Imperator Fyron:
Only "normal" progressive income taxes discourage getting pay raises. Flat taxes and reasonable progressive income taxes (as in, the richest pay maybe 2x as much as the poorest that do not qualify for tax exemption for being below a poverty line) do not discourage that.

A payrise is still a payrise. I'm in the top Australian tax bracket which means I pay a hefty 47% tax on my income over $60k AUD and I've never felt "discouraged" about getting pay rises. I've only ever seen people get upset about pay rises when theirs was less than a co-worker who they believe does inferior work. Satisfication with income is always based on comparitive measures, never absolute.

Askan

[Askan Nightbringer]

Originally posted by Imperator Fyron:
Why, because I know what a progressive tax system is and that hording money causes economic problems?

Fyron is correct, saving is bad for the economy. Interest rates are low to discourage saving and encourage spending (financed through debt).

Askan

[Fian]

While storing your money in a hole in the ground may be bad for the economy, saving it in a bank is not. Savings allow the financing of big projects plus the creation of new companies (who usually take several years to become profitable) which creates new jobs. While not an economist, I can't see how anyone would think that saving money is a bad thing. Encouraging people to go into debt to continue to keep spending levels up (which incidentally requires that someone must have saved that money in order for them to borrow it) is the true recipe for disaster.

On another note, while the idea of a federal sales tax in lieu of an income tax sounds like a good idea, it would be devastating to the economies of areas near Canada or Mexico. Currently, goods in Mexico are more expensive than the goods in the US, so you find that many Mexicans drive accross the border to purchase American goods, devastating the local economy on the Mexican side. If the situation were reversed, you would see the American side devastated and everyone going accross the borders to buy their goods. You would also need to deal with the export of goods as well. If we were to charge other countries our sales tax, that would raise the prices of our goods, making them less competitive, hence fewer American goods would be purchased. This second issue, probably has ways around it, though, like no tax on exported goods, however I suspect it wouldn't be that simple.

[Fyron]

Fian, economics works pretty much opposite of how you just said in your first paragraph.

[Fian]

I am pretty sure that I am not wrong on this (heck, even the Investor's Business Daily agrees that saving is a good thing). Encouraging spending via debt is only a temporary benefit to an economy. Saving ensures the long term stability of an economy. Where do you think all of this money is coming from that people borrow? It is only possible because some people choose to save their money in banks, which then in turn loan the money to borrowers. If there are no savers, there can also be no borrowers as well. I didn't realize I was talking about rocket science here.