If the extra income is going to be taxed away, why would they bother making more money? Or even part of it, since the ratio of effort to income would presumably have diminishing returns like most things.

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Or you could say that a high tax rate is an incentive to make more money because you need to make more to take home more.

So you think the economy is a zero-sum game? Make your own car then. From scratch.

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And what about that reference I posted? Your wishful thinking trumps history or what?

It's rather obvious you don't know much about economics, but wouldn't you agree that if you had to make your own car and the auto worker had to write his own programs you'd be much worse off than you are now? Henry Ford didn't have a factory to make his first car.

http://everydayecon.wordpress.com/2006/10/11/economics-is-not-a-zero-sum-game/

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The desire to work is disproportionate as well. Let's make everybody work the same if they're going to make the same amount of money. Too bad that leaves out designing car engines, writing computer programs and managing corporations, since those are worth more than flipping burgers. And before you object, "golden parachutes" for CEO's aren't the fault of capitalism or economics.

At what point did I say that workers should work at jobs they are unskilled at? That doesn't make any sense.

No, but he had to at least have the materials and equipment necessary to put one together. That's called capital. Rich people have it, poor people don't.

So you think no one should pay taxes at all then? Okay, so who do we convince to build our roads for free? Or our schools, or our sewers, or anything else that the government takes care of for the public good?

Businesses are leaving the country because poor countries are so desperate to have jobs they'll accept deficient wages, and so the businesses can squeeze even more profit out of people.

To be "fair," people would only pay for the services they use. End of story.

Taking money from the rich, even if at the same percentage of the middle class, and giving the money to someone else is not "fair" to the rich person. It's not "fair" to be born to a poor family in the ghetto. That person is at a distinct disadvantage to somebody born to a rich family.

It's all about finding the greatest good for all of the nation. If you tax the rich too much, then they may find ways to lower their income (legal or not). If you tax them too little, then the poor people are unnecessarily left out in the cold.

There's a happy medium somewhere between the two, and it has nothing to do with using the same tax rate for all people.

It's more subtle that just being able to afford it. Let me give a silly little example: parking fines. In many countries parking fines are a flat fee. If you park your car where you aren't meant to, you have to pay X dollars. For an ordinary person X dollars might be a serious inconvenience, but for a rich person X dollars is pretty small. Thus rich people (and organisations) can pay for the right to park their car wherever they like. The cost of the parking fine is the same in terms of dollars, but there is some measure of value for which the parking fine is cheaper for the rich person. The key point is that the same money is more valuable to the poor person than to the rich person. If you want to have a flat tax rate based on that kind of value, then the rate based on dollars should be higher for higher incomes.

I'm pretty sure that we all understand the distinction between tax rates and tax revenues. And although "more revenue may often be obtained by lower rates", that doesn't mean "more revenue may always be obtained by lower rates". Presumably there is some kind of optimum. I don't know what the optimum tax rates are, but I suspect it is not optimal to have a flat rate for all citizens.

OK, to be "fair", consider some level of income as "survival" level, say, $10,000.00 US. I've lived off that (or less) for the last 35 years without whining for govt. handouts (although there were a few unpaid debts along the way).

Now count that as "zero" and tax some set amount above that at a set rate, maybe 10% (hey, it's good enough for the church). So someone making $100K a year would pay $9000 a year.

Of course this doesn't take into account the fact that different areas of the US don't have wildly different costs of living just to get by.

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Wanting the government to give lazy bums everybody elses money is stupid too, but it's quite attractive for the bums.

It makes people avoid riskier business deals and focus on avoiding losses. Here's a simple explanation:

If I lose money, I lose 100% of it.
If I gain money, I gain 60% of it.

The result is less investment in longer term stuff, less investment in crazier ideas and a general movement towards lethargy. There is a clear and obvious example of the effects of this sort (ie. messing with time based volatility): Go to a city with rent control. Every building is unmaintained and crappy, landlords don't invest in making them nice. The paint is peeling, they're never remodeled, the facets are old, the elevators are old etc.

FTFY.

I think that's a very narrow view, Dustin. Sure, less money = less black to play with. However, doing business is still better than not doing business. You still make more money. 60% of something is more than 100% of nothing. It isn't necessarily good to invest in risky opportunities, but then those are always a gamble so I don't see what taxes have to do with it. If you lose you lose no matter what. If you gain you gain no matter what. You might gain less if some of it is going towards taxes, but those taxes are responsible for maintaining necessary parts of the system all around you that you depend on...

I think business should absolutely be taxed and only small businesses that actually struggle should get any exemptions or breaks. Certainly corporations that are dealing in 6+ figures should get no breaks whatsomotherfuckingever.