Are the rich paying their 'fair' share?

[Al B. Sure!]

There's no ****ing way that 30 million people (or 17 million households) live on less than say 30 dollars a day.

$30 a day is just under $11K/year.

8.64% of households make under $12.5K/year household income.

There are ~114M households in the US.

So around 9.8M households live on less than 34 dollars a day.

Average household size looks to be 2.74 but we don't know if lower income households are smaller or larger.

Still, that would come to ~27M people living on less than 34 dollars a day HOUSEHOLD income.

No ****ing way? Looks very plausible!

[Al B. Sure!]

39.8M Americans live below the poverty line which is at $10,890 for 1-person households and $22,350 for 4-person households.

That's precisely $30/day for 1-person households and $60/day for 4-person households.

So yeah. 40M Americans live on less than $30/day.

There's no ****ing way that 30 million people (or 17 million households) live on less than say 30 dollars a day.

No ****ing way? It's actually 40 million Americans, not 30!


Should I laugh or cry at your sense of perspective?

[Al B. Sure!]

To be fair, I only made $5000 last year and my lifestyle is cool except for the risk of crime. I have cable internet, hot water, xbox live subscription, I eat well... And I lived on less than $14 a day.

[Jon Miller]

Even right now, when I try to be very cheap and eat a lot of meals of 'bread' or 'milk', I still struggle to get my food budget below 6(euros, but cost of living wise they seem to be the same as $ where I lived in the US) a day.

I figure I live on (for everything, including entertainment) 600(euros, but once more, cost of living is higher) a month.

JM

[Jaguar]

But their houses are worth that much, they can go around and sell them for as much as they paid for them (usually), despite acquiring all the advantages that Alby discussed.

You are just arguing our point, that wealth (particularly, greater amounts of it), give distinct advantages which are not just present/future consumption.

JM

Jon, that's equivalent to rent, or return on investment. Lots of durable items provide a return on investment while you're using them.

Basically, you've made up this concept and fixated on it for years now, when you still haven't come up with a single good example of it.

Money is useful because it lets you buy things. That is all.

[Jaguar]

Oh I know this but I wasn't going to give my opponents an argument to use against me until I had a response.

But since you took the cat out the bag, even if Fairfax residents did pay significantly higher local taxes than Philly residents and that money was used to better fund local police, education, etc. (as was apparently HC's and gribbler's original argument), I doubt it would explain the huge disparity in crime rates.

There are 6600 Philly police officers serving 1.5 million people with an annual budget of $536M.
Fairfax has 1400 officers serving 1 million people with an annual budget of $117M.

And yet, we have 6 times the crime rate. This is because the number of police officers and the PD's budget alone does not explain differences in crime rates. Median household income is a good predictor of crime rates, however.

White people pay a lot - as in, hundreds of thousands of dollars - to avoid living near people like your neighbors.

[Jon Miller]

Jon, that's equivalent to rent, or return on investment. Lots of durable items provide a return on investment while you're using them.

Basically, you've made up this concept and fixated on it for years now, when you still haven't come up with a single good example of it.

Money is useful because it lets you buy things. That is all.

No.

All of history proves you wrong.

It gives you power also. It also enables your brain to function better. http://www.haaretz.com/business/the-...-trap-1.414260

And gives you access to things which have a much much higher value/$ spent than those who do not have wealth.

And you can give it to others, who also (in your messed up world) don't pay taxes on it.

You can't say that 'money is the same for me as for a poor person' when your money allows you to consume and have even more money after consumption than you had to start with while the poor person consumes and the money is gone (and does not have the option to consume the good that you consume).

JM

[Jaguar]

No.

All of history proves you wrong.

It gives you power also. It also enables your brain to function better. http://www.haaretz.com/business/the-...-trap-1.414260

And gives you access to things which have a much much higher value/$ spent than those who do not have wealth.

And you can give it to others, who also (in your messed up world) don't pay taxes on it.

You can't say that 'money is the same for me as for a poor person' when your money allows you to consume and have even more money after consumption than you had to start with while the poor person consumes and the money is gone (and does not have the option to consume the good that you consume).

JM

All of these are directly attributable to my ability to buy things, and nothing more. I don't worry as much or suffer from as much stress because I can eassily afford necessities and wants. I can invest money for retirement. These are outstanding advantages - but all of them come from my ability to exchange money for other things.

[gribbler]

Police are more valuable than actuaries. Firefighters, as well, yet most communities don't even pay firefighters! Must be a very valueless job!

It's not about value. There's other factors that affect pay beyond how 'valuable' or necessary the job done is. For example, how many people could and are willing to do the job. Shifts towards higher-paying professions are not instantaneous, especially when they require a certain educational background and certification.

No, a police man is not more valuable than an actuary unless you think police departments are vastly underfunded.

[Jon Miller]

But you get a better exchange rate when you exchange money for goods.

Therefore you should be taxed at a higher rate. In other words, you should get a higher exchange rate when you receive public goods.

JM

[Jaguar]

But you get a better exchange rate when you exchange money for goods.

Prices are exactly the same to me as they are to any other person. Any advantages I have come from things that I purchased previously, or my greater ability to purchase things in the future.

[Jon Miller]

Wrong.

Prices are cheaper for you than they are for people who have less money.

We have given many examples of that in this thread.

If you are wealthy enough, often times things are priced so cheaply that you actually make money on your consumption.

JM

[Jaguar]

You've given a bunch of examples of how you can get advantages once you purchase a seven-figure home.

[rah]

The only incentive for the 1% to pay more in taxes is so the other 99% don't get so pissed that they revolt and take away all their money.

[Jon Miller]

That is the only incentive, and it is true. Especially since they hold the power (due to having the wealth).

But let's talk about what is fair here.

Person A has 110$ and makes 11$ per year.
Person B has 0$ and makes 11$ per year.
Having a place to live costs 10$ per year, or you can buy a place for 100$ a year. It is a nicer place (we ignore), and it increases in value. Let's assign this value, and say that buying a place gives you an additional 10$ in value per year. Let's also consider a 10% consumption tax.

They both make the same, simple world, just one person is wealthy and the other person is not.

In 10 years:
Person A has 110$ + has gotten 100$ in value from his purchase + has an asset that is valued at 200$ = 400$ total of 'present' + 'future' goods and has paid a total of $10 in taxes
Person B has 0$ (he had to consume it all) + 100$ in value from his purchases = 100$ total of 'present' + 'future' goods and has paid a total of $10 in taxes

Does it seem like taxing only consumption fairly taxes the person A relative to person B? And I am even being nice to person A, his investment isn't increasing in value produced in time like is generally the case. This is also ignoring that person A has a nicer place, which person B will never be able to have (for person B to live there per year, it would cost 20$, say, but that would just change it from 4:1 to 5:1).

Your delayed consumption versus non-delayed consumption only works when people start equal. People very much do not do so.

JM

[gribbler]

To be fair, I only made $5000 last year and my lifestyle is cool except for the risk of crime. I have cable internet, hot water, xbox live subscription, I eat well... And I lived on less than $14 a day.

So you could earn minimum wage and save over half of your income? Weren't you claiming earlier that people on $15,000 have very little ability to save their money?

[Jon Miller]

I am amazed that he can have a place to live, pay utilities, and get food at 400$ per month.

Most cities I have lived, the minimum rent was about that high.

JM

[Jaguar]

That is the only incentive, and it is true. Especially since they hold the power (due to having the wealth).
Person A has 100$ + has gotten 100$ in value from his purchase + has an asset that is valued at 200$ = 400$ total of 'present' + 'future' goods and has paid a total of $10 in taxes
Person B has 0$ (he had to consume it all) + 100$ in value from his purchases = 100$ total of 'present' + 'future' goods and has paid a total of $10 in taxes

Not at all. Person A's assets - a house and a cash reserve, would not be exchangeable for $300 worth of goods without paying taxes. You've also decided to have a house give you a 200% ROI in ten years, which is absurd. If houses were really a sure thing to get you a 200% ROI, then no-money-down subprime mortgages were a great idea.

Jon, if you're just trying to argue for some amount of wealth redistribution in general, that should be an easy position - yet you keep migrating from one bizarre, incorrect argument to another - some of which are actually the exact reverse of the actual strong arguments for wealth redistribution.

Wealth should be redistributed from me to Albie because he gets more bang for his buck, not less. He lives a reasonably decent life on a fraction of what I live on, but his life can be improved substantially for small amounts of money, while mine can't.

[Jon Miller]

Of course, if you think that is 'fair', we can consider a slight change (and introduce person C, who with 0 to start but a more able 24$ per month, let's also increase person A and person B to 13$ per month and consider what happens after 100 'turns').

Person B has received 1000$ in consumption, has paid 100$ in taxes, and has 'future consumption' of 200$.
Person A has the option of leaving the wealthy class and joining the capitalist class. He has received 1000$ in consumption, paid 10$ in taxes, and has 'future consumption' of 1300. His asset is worth 1100$. He can purchase another house at 1100$ (with 110$ more in taxes) to increase his income to 23$ per month.
Person C has the option of leaving the poor class and joining the wealthy class. She has received 1000$ in consumption, has paid 100$ in taxes, and has 'future consumption' of 1300$. She can purchase a house at 1100$ (with 110$ more in taxes).

Does this seem fair, tax wise?

JM

[Hauldren Collider]

Jon, if you're just trying to argue for some amount of wealth redistribution in general, that should be an easy position - yet you keep migrating from one bizarre, incorrect argument to another - some of which are actually the exact reverse of the actual strong arguments for wealth redistribution.

QFT, if rich people actually got more utility from an additional 200 dollars than poor people, we should redistribute from poor people to rich people. Reductio ad absurdam.

[Jon Miller]

That effect can be accounted for, with minimal change to the model by introducing:
1. Someone can fall sick for 1 turn, while sick they are entirely unproductive
2. If someone doesn't have a place to live, they are unhappy and are 1/10 as productive

Probably then type A people should be re-labeled working class and the in poverty people would be those without a place to live (type E/F).

You complaint about the first 10 turns being unreasonable can be fixed by setting the model some XX turns in the future (but not so far in the future where type C people all own their own homes).

The model could be made dynamic for allowing:
1. Someone who doesn't work and lives in a home is very satisfied for that turn
2. After YY turns, a person is replaced by their progeny (who might have a different ability than them). All wealth is given to the progeny, the new persons valuation of being 'very satisfied' is pulled again from the theoretical distribution.

Consider the taxes paid and amount of turns spent satisfied/very satisfied as a function of inherited wealth.

How is not taxing capital gains 'fair'?

I can understand how it isn't economically advantageous. That is why I have been saying all along that in a capitalistic society, the 'best' solution might be to tax consumption and put in transfers.

JM
(would be even better if 'ability' was a distribution)

[Jon Miller]

QFT, if rich people actually got more utility from an additional 200 dollars than poor people, we should redistribute from poor people to rich people. Reductio ad absurdam.

No, because that would be evil.

When you consider that for the rich person, because they gain wealth from consumption (which only they can consume), they do get more bang for the buck. Because it is so cheap for them (better than free!).

JM

[Jon Miller]

Just because Warren Buffet could turn the money I gave him around and make it be 2x as much in 10 years doesn't mean that it is better for me to have that money taken from me and be miserable for 10 years so that the overall utility is greater.

JM

[Hauldren Collider]

No, because that would be evil.

When you consider that for the rich person, because they gain wealth from consumption (which only they can consume), they do get more bang for the buck. Because it is so cheap for them (better than free!).

JM

Jon, it wouldn't be evil if it were true! If the money actually had more use in the hands of rich people than poor people, then it would be evil NOT to give it to the rich people. If you don't agree, then you probably are misunderstanding something crucial about "utility".

[Hauldren Collider]

Also Jon, what the hell is the point of "fairness" if it leads to demonstrably worse outcomes?

[Jaguar]

No, because that would be evil.

When you consider that for the rich person, because they gain wealth from consumption (which only they can consume), they do get more bang for the buck. Because it is so cheap for them (better than free!).

JM

Purchase of housing is an investment, not consumption. The rent you forgo by living in that housing yourself instead of renting it is consumption. People in econ figured out how to categorize different sorts of spending and labeled them in precise ways to avoid the sort of muddled confusion you're exhibiting here.

[Al B. Sure!]

No, a police man is not more valuable than an actuary unless you think police departments are vastly underfunded.

Which would you rather have? No police or no actuaries?

So you could earn minimum wage and save over half of your income? Weren't you claiming earlier that people on $15,000 have very little ability to save their money?

I'm not most people. I also don't have dependents.

Unfortunately, not everyone can be me or live like me. I understand that.

[Hauldren Collider]

That's not a definition of value. Which would you rather have, no farmers or no computer scientists? But who gets paid more?

[Al B. Sure!]

That's not a definition of value. Which would you rather have, no farmers or no computer scientists? But who gets paid more?

That's precisely the problem with determining the social value of a job solely by the amount the job pays in dollars!

[Hauldren Collider]

Alby, we're not measuring people as good human beings, we're trying to figure out how much resources they should be allocated.