Out of all of the commentary I’ve read about this idiocy today, yours is my absolute favorite.  I therefore and hereby award you an award.

I’ve always found the claim that higher taxes for the rich would cause people to no longer try to make any money to be facetious and insulting to the extreme. Even if the tax rate goes up as your income does, people will still be motivated to make more money. Why? Because more money is still more money. Show me someone who would genuinely aim for $249,999.00 because their previous $400,000 will be dropping to $350,000, and I’ll show you a complete goddamn idiot.

Of course, thinking this way requires deliberate ignorance of not only math, but recent history as well. Remember how all those rich people didn’t bother making any money until Bush cut their taxes? As I recall, Donald Trump was living in a homeless shelter and collecting soda cans.

I’m sure glad that Louisiana woman is a lawyer, not an accountant.

That is one of the dumbest things I’ve ever heard. And I’ve heard of a lot of dumb ideas.

“We are going to try to figure out how to make our income $249,999.00,” she said.

Cool by me.  The business she gives up can go to a different lawyer - preferably not one who’s a lazy fucking prick.

“Why kill yourself working if you’re going to give it all away to people who aren’t working as hard?”

People who aren’t working as hard . . . she means CEOs and hedge fund managers, right?

Is this the current crop of overpaid children who precipitated this mess in the first place?  The ones who think they already pay too much in taxes and complain about not being able to afford the second yacht?

Dears.  Please, please hie yourselves to Galt’s Gulch.  Sequester your dollars and sneer about the underclass, the incompetent, the financially strapped.  Get out of the way.

Let the rest of us come together (eeek!  Collective action, eeeek!) and fix this mess.  Because you mugs may think you’re Dagny Taggart and James Reardon, but you’re really James Taggart and Mrs. Reardon.  You’re that guy Chip Whatsisname.  You are the looters.

(Yeah, it’s been a while, and the names were the first thing to go.)

How the hell did she pass the bar without taking Basic Income Tax?

I’ll confess (again) that I come to this page from a position of privilege. My husband and I are in our early thirties, and my husband has been out of grad school and working for an awesome and successful chemistry consulting firm for about four years now. Each year since he left grad school, our income has increased so much that we pay noticeably more in taxes.

But you know what? It’s also increased more so much that we get to pay noticeably more down on our student loans, into our vacation fund, and into our child’s college fund - to say nothing of of spending more on eating out, books, and woodworking supplies. In no way has our quality of life in any way been negatively impacted by our increase in taxes. Not even a tiny bit. We have never received a particularly large bonus and thought, “Oh no, we only get to keep 60% of this! It totally isn’t worth it!” We have never turned down a raise because we wouldn’t want to give it to people who <strike>don’t work as hard as us</strike> aren’t as lucky as we are.

You know why? Because we’re not complete idiots.

Even if the tax rate goes up as your income does, people will still be motivated to make more money.

There are some circumstances where this might not necessarily be true. If you are paid by the task or by the hour, then if the tax on your next dollar is high, you might decide at some point that your free time is worth more than the after-tax income you get from that next hour of work. That, of course, doesn’t apply to hedge fund managers and others who are paid on salary. It could apply to people like doctors and lawyers.

Which is not to say, however, that this article isn’t stupid and that the writer isn’t as dumb as a sack of hammers.

So why stop at $249,999?  The Government!!! (oooh, scary!) is still getting some of her money.  She should just quit, abandon her dwelling, live under a bridge, and beg strangers for change…

***

I was just telling my wife that I wanted to start a plumbing business that would make me over $250,000. 

But then I realized that out of every dollar I made over $250,000, our Evil Socialist Government would now get a couple pennies more than they did under the previous president (I’m sorry, but I’ve forgotten his name).

So now it’s totally not worth it anymore…

Damn socialists…

I hope your goddam sink gets plugged-up and floods your house, ‘cause I’m not gonna come over there and fix it if all my money is going to be stolen and given to Cadillac-driving Welfare Queens…

I guess this helps explain why Bush Jr. had two terms in office when he isn’t qualified to pick up litter from the side of a road…

Atlas Shrugged 2: One Hour Later

http://rebirthofreason.com/Spirit/Jokes/371.shtml

Well, she’s not a complete idiot.  She refused to let them name her in the article.

As for not wanting to make money if the tax rate is too high…my feeling is that if you are taxed at 90% for every dollar you make over say, $5 million/year, you might decide to spend that energy on something more resourceful.  Perhaps you would find philanthropy or naked bungee jumping to be more of a status symbol than simply earning more money.

That’s not a bad thing.  Earning money just to make money, not to produce a quality product or service or to improve life for some or several isn’t a moral action. 

Richard Roeper, man of so much white privilege, wrote about some college kid from a Nordic country (Sweden?  Denmark? don’t remember) who won $4 million in a poker tournament.  The first $2 million he keeps, but almost all of the rest of it is taxed away b/c it’s “gambling revenue” and whichever Nordic country it is apparently doesn’t value its citizens making gross fortunes by gambling.

Roeper, although admitting $2 million is a lot of money, was appalled that the rest was going to be “taken away”.  I always trust Roeper to point out the position of white male privilege for me, and he has yet to disappoint.

In the grand sense of it all, perhaps the Nordic gambler will turn to other pursuits.  Perhaps he will enter only one or two poker tournaments a year; perhaps he’ll do something else.  But is the fact that he can only make a small fortune instead of grotesque fortune by gambling a bad thing?

Srssly, I’ll probably never even make a quarter of $250k/year* and I’m plenty comfortable. You have to be a greed bastard and/or stupid to think like her.

*And I do not care. Where do Republicans get this idea that everybody wants to be obscenely wealthy at any cost?

some college kid from a Nordic country (Sweden?  Denmark? don’t remember) who won $4 million in a poker tournament.  The first $2 million he keeps, but almost all of the rest of it is taxed away

I mean, if I made that in the US, at current tax rates, almost all of that $4 million would be taxed at the top marginal rate (because I already have a well-paying job), so my federal tax is 33%. Then I have the state taxes to deal with, which can run, on average, from 5% to 8% (yes, you could live in a no-income-tax-state, but I never have). So even in the US, you’re going to lose 40% of any winnings you get when you’re in the range of large numbers. Scandinavian taxes are clearly higher but not confiscatory in that case. Did Roeper ever think to compare what the comparable take-home purse of an American would be?

What kind of shitty country only lets you take home two million dollars for winning a poker tournament. 

I heard in Ireland you take home $3.8 million.  And in Soviet Russia, poker game takes you home!

My take is that this lawyer is not stupid - she’s lying.  It’s what Republicans do when arguing for bad, unpopular policies.

I find the idea of cutting back on wages to avoid paying taxes disgusting.  This is nothing more than a manifestation of greed.  Heaven forbid they share a piece of the pie so that others may live more comfortably.  We have this idea that if someone is poor it is because of individual failing rather than recognizing it as the social and or structural failing of our society. Hello McFly if someone is working two jobs to pay the bills and cannot seem to get ahead it is because we have comofided the necessities of life and not because they were unwilling to do all that they had to survive.

Two words, Counsel….....................................pro bono.

My favorite part is that apparently these small businesspeople have a NET income of over $250,000 after they have paid all of their business-related expenses (like rent, electricity, employees, etc.) which means that their business must be grossing, what, like $500,000 or $1,000,000 for them to be able to pay themselves $250,000?  So now they’re going to cut back their business rather than, say, raising their employees’ pay so their own pay can stay at $250,000?

Either that, or they’re complete fucking idiots and think that what’s going to be taxed is their revenue, not their income.  If that’s the case, then they deserve to go out of business.

And people have been this obtuse for a long time.  I come from a pretty conservative family I remember when I was a kid (probably early 80s’) hearing the argument from my dad that my mom should not work because if she did, it would push the family into a higher tax bracket and they’d actually lose money.  I remember this conversation taking place *with his accountant* (who was also a friend from high school and college) sitting in the room.  Either this was a piss-poor accountant or he was happy to support that argument.  Obviously this conversation stuck with me, and I remember thinking at the time that this seemed pretty screwy if things actually worked that way.  Now I understand that they don’t, and it’s probably a deliberate misunderstanding of how things work that allows conservatives to make these kind of arguments about progressive taxes harming productivity, and a nice by-product (which I bet still occurs in some households) is that serves as an excuse to keep women who have stayed home with kids for some period of time from gaining or regaining economic power by returning to work.

GAAH!

I would like to volunteer to accept any excess income these people would like to dispose of.  So great is my commitment to this noble cause that I am even willing to accept a slightly higher marginal rate of taxation in return.

Please don’t thank me.  You’d do the same if you were in my place.

I know this is totally not the point of the post, but I wish I was that good at poker.  If I could keep 1 million the government could have the rest.  I’d wrap it up in a pretty pink ribbon.  I suppose that would be because I’d have a million dollars, and dude, I won that poker tournament!  It’s not like the kid quit playing, he’s probably going to make a run at winning a dozen more in his lifetime.

I always have wondered…

Who takes out the trash in Galt’s Gulch?  Who mows the lawns?  Who fixes the potholes?  Who greases the bearings in the electric generators?  Who mines the coal to fire the power plant?  Who, in short, does all the menial, odious, Mike-Rowe-style dirty jobs that make a modern technological civilization possible?  These things are just magically taken care of in Randroid Utopia, because everyone there is far too busy thinking big thoughts to waste their valuable time on such petty details.

Thom Hartmann addressed this on his show a few weeks ago.  He was talking about being a small business owner in the days before the Reagan tax cuts, when the marginal rates were MUCH higher than they are now.  He said (IIRC) that there WAS a disincentive to take money above a certain amount out of the business proceeds, but that was becuase it would be taxed at a higher rate than if it was left in the business.  So the higher marginal rates actually enouraged people to put money back into their business, rather than taking it out to feed their addiction to greenbacks.

liberalrob—

See the link to “Atlas Shrugged Part 2: One Hour Later” in the link I posted above. It answers that question.

In addition to comparing what the Norwegian card player paid in taxes (vs. what he’d have paid here), I’d take it a step further and compare what he gets (i.e. health care, lower crime rates, etc.) for his taxes to what he’d get here.

This is pretty stupid but I don’t think it’s THE stupidest thing I’ve heard.  How many people buy lottery tickets every week?

Let the crazy people cut back on the amount of work they do, and the people who care, are good at work, and sane will have more opportunities available to them.

Two things:

One, this Louisiana attorney knows precisely what she’s doing; two, she has no intention whatsoever of trying to reduce her income to $249,999.99.

This is a game being played by people who know better to confuse people who don’t know better about how our marginal tax rate system works.

I have difficulty believing that somebody with enough basic intelligence to complete law school and pass the bar isn’t aware of how the tax code works on this basic of a level.

What these folks are trying to do is to convince those who DON’T make $250K per year that if they ever do surpass that income level, that Obama’s proposed tax rates will effectively cause them to take home less net income.  The false message they are sending with regard to the $250,000 threshold is that the higher tax rate would apply to ALL of their income, not just the money above the $250,000 line.

The fact of the matter is that if you make $251,000 in the year when this law takes effect, you’ll take home the exact same money on the first $250K as someone who makes precisely $250K, PLUS you’ll take home all but $30 of the extra $1,000 above that threshold that you would have previous to the changes.

A person making $250,001 in 2011 pretax dollars will still be taking home more money than a person who makes $249,999 in 2011 pretax dollars.

He said (IIRC) that there WAS a disincentive to take money above a certain amount out of the business proceeds, but that was becuase it would be taxed at a higher rate than if it was left in the business.  So the higher marginal rates actually enouraged people to put money back into their business, rather than taking it out to feed their addiction to greenbacks.

In other words, it encouraged investment over personal consumption.

No wonder we’re so screwed.

Also, that Norwegian kid still takes home 2 million dollars, which, even with inflation, I understand will buy you a decent meal. He may even have enough left over to ride the bus home.

I wonder if they ever acknowledge that the easiest ways to reduce your tax liability are to contribute to retirement funds and/or give to charity.  You don’t even have to be a grandstanding douchebag to do these things!  I suspect that is why the simple soultions never occurs to these Galt-ish captains of industry.

Putting it away for retirement would require the capacity for something called “delayed gratification” which immature Galt-ish types lack.

Last I checked, income tax percentages were indexed to the specific part of the income they apply to so as to avoid incentive traps?

I.e, 10% of the first $7000 or whatever it is, 15% of the next $20,000, et cetera.  Not, hit the magic $250,000 and the tax is NewScaryRichPeopleTax% of the whole load.

“Why kill yourself working if you’re going to give it all away to people who aren’t working as hard?”

Somebody hand this person two menial minimum-wage jobs, and have her live in accordance with the income they provide for a couple months.  Tune changing in five . . . four . . . three . . .

Y’know something, even when the top rate was 90% people worked their asses off to make more money. (In high school, I knew a kid whose father had been an entertainer and reached the coveted 90% level. On the other hand, the kid said, when you worked that much, nearly everything—clothes, meals, transportation—was deductible, so it evened out.)

Meanwhile, of course, there are plenty of incentive traps with how much money the government takes from you, but they’re all aimed at poor people. Depending on which programs a poor person is enrolled in and how they handle income cutoffs, it’s not implausible for them to lose more than a dollar for each additional dollar they earn. But oddly the right doesn’t consider this a big disincentive-to-work problem.

I love that image.

i can only imagine what kind of people are able to enter the legal profession in somewhere like louisiana.

Actually, Louisiana’s state bar can be quite difficult to pass unless you obtained your JD from Tulane, Loyola, or LSU.

The reason being?

Louisiana operates under a code based on Napoleonic Law, unlike the other 49 states.

The point I was trying to make is that I think this woman’s threat is completely empty, and that the folks promoting this threat aren’t doing so in good faith.  I imagine 99% of $250K+ earners are fully aware of how marginal tax rates work, but if they can spread the meme that Obama’s plan will effectively cause people to make less by making more, that meme can take hold among tax evading non-plumbers like Samuel Wurzelbacher, who will buy into the lie that Obama will essentially be punishing high earners by causing them to take home less money than lower earners.  And when you get the meme to stick with the “everyman” that Wurzelbacher is supposed to represent and then they start spreading it as well, dumb people who genuinely don’t understand marginal tax rates get sucked into believing it, and you create a false panic in the masses who start believing that Obama is trying to “punish” financial achievement.

This has nothing to do with trying to make a statement and take a stand, and everything to do with trying to throw a monkeywrench into Obama’s agenda by screwing with public opinion using false premises.

Clarification on the above post… I was referring specifically to Loyola-New Orleans, not Loyola-Chicago or the other two Loyolas out there.  I went to LOYNO for 2 years.  Love that city.

A great quote from BioShock regarding the complete unraveling of the Randian utopia:

“Everyone came to Rapture expecting to be captains of industry, but someone has to scrub the toilets.”

I always trust Roeper to point out the position of white male privilege for me, and he has yet to disappoint.

No shit.  Remember that article he wrote bemoaning how Dove was using *gasp* ordinary looking women on billboards and how he shouldn’t have to look at women who weren’t models?  And then follow-up article where he whined that he was (rightfully) being called an asshole?

The point I was trying to make is that I think this woman’s threat is completely empty, and that the folks promoting this threat aren’t doing so in good faith.  I imagine 99% of $250K+ earners are fully aware of how marginal tax rates work, but if they can spread the meme that Obama’s plan will effectively cause people to make less by making more, that meme can take hold among tax evading non-plumbers like Samuel Wurzelbacher, who will buy into the lie that Obama will essentially be punishing high earners by causing them to take home less money than lower earners.  And when you get the meme to stick with the “everyman” that Wurzelbacher is supposed to represent and then they start spreading it as well, dumb people who genuinely don’t understand marginal tax rates get sucked into believing it, and you create a false panic in the masses who start believing that Obama is trying to “punish” financial achievement.

Exactly.  The meme is directed at the $50000 millionaires who eat up everything Rush tells them.  The woman’s comment had all the hallmarks of a right wing meme:  The rich work harder, taxes go to lazy people who don’t work, etc.

The consumers of this attorney’s services should shrug.

Richard Roeper, the film dude?

Wow, never knew he was a wingnut ass.  I discovered that Roger Ebert was liberal-leaning when he wrote a scathing article for the Sun-Times slamming McCain for challenging Obama’s patriotism, but I had no idea that the other dude was a Gooper.

“Why kill yourself working if you’re going to give it all away to people who aren’t working as hard?”

I’d like to see her say that after working where I did one of my summer jobs in the 80s - on stage crew repping a 5-show opera theater. A different show every night, 6 nights a week.

For $150 / week.

We’ll just see about work per dollar earned.

I have to wonder how many of these people also believe that if something is tax deductible, it’s really free because you “get all that money back”. (And yes, I’ve had that exact conversation more than once.)

Was there ever a time when the tax wasn’t marginal? Because all my life, I’ve heard that getting a raise that bumps you into a higher tax bracket can result in a lower take home pay. It’s pretty much in the whole “common knowledge” category, and I would be really interested in the origin of this.

(Oops—I blasphemed too soon.)

On the IRS web site, all the historical tax rates are referred to as “marginal”,so I’m really curious where this whole “higher tax bracket = less money” comes from.

Could they be confusing actual taxes and withholding, maybe? Or does this apply to businesses but not individuals? Another GOP zombie lie, here to eat our brains?

I have ony derision for these people. I paid my taxes at a time when I was self-employed (often because I was hired temp as an “independent contractor”) and my taxes had to come out of my savings. One dreadful year I paid my taxes with Visa. Admittedly I was making so little money that my taxes were relatively small, but they didn’t seem like it. Apparently I should have done the American thing and incorporated as an offshore company in a Caribbean island and put my earnings in a data haven and not paid a cent.

I’m really curious where this whole “higher tax bracket = less money” comes from.

A. Ignorance.
B. Poor math skills.
C. Perverse desire to believe, against all evidence, that “they” are lying about what actually is true.
D. All of the above.

Could they be confusing actual taxes and withholding, maybe? Or does this apply to businesses but not individuals? Another GOP zombie lie, here to eat our brains?

They confuse nothing, at least not the leading agitators and proponents of this myth.

The more money you make, the more money you take home.  Period.

That’s the way our tax law works and the way it has always worked.

There is no such thing as a disincentive to earn more money.  People who earn more money before taxes have a bigger paycheck after taxes.  And it’s always been that way.

Yes, it is true that the top 2% of earners will take home less money on their current income under Obama than they had been under Bush, but they will still be taking home more money than the other 98% below them, just as they always have.

There is no inherent financial reward in trying to stay under the top marginal rate.  None.  It’s a GOP myth.

Wow, never knew he was a wingnut ass.

I don’t know that he’s certified Grade A wingnut, but his picture is in the dictionary next to the entry for clueless choad.

One of the people who manage my money told me that some of their wealthy clients insisted on being invested in such a way as to pay no taxes (presumably by putting it all into tax-free bonds).

There’s a name for people like that.

Morons.

Call them the anti-Warren Buffetts.

To them, it is more important to do everything in their power to prevent the big, bad evil gubmint from getting their grubby hands on “their” money than it is to maximize their return on investment by putting their money in higher yield products.

Who loses as a consequence?  Everyone.  The idiot who puts his money in tax-free investments takes home less money because he’s chosen the very lowest yield product, and the government gets less money because this moron’s animosity towards the government is stronger than his desire to take home the most money possible.

But he sure showed them.

A great quote from BioShock regarding the complete unraveling of the Randian utopia:

“Everyone came to Rapture expecting to be captains of industry, but someone has to scrub the toilets.”

Love that quote, and I’m always a little happier when someone else posts here withit.  I think that one sums it up pretty well, that and this one: “We all come down here, figured we’d all be part of Ryan’s Great Chain.  Turns out Ryan’s chain is made of gold, and ours are the sort with the big iron ball around your ankle.”

(Of course, considering the source of the second one, nobody likes using it…)

Try removing the cap, and expect a deluge of pushback in the media.

This is by far the easiest way to make Social Security solvent for literally centuries, so it will happen eventually wingnut bitching or not.

Could they be confusing actual taxes and withholding, maybe? Or does this apply to businesses but not individuals?

There’s way this confusion can happen (albeit in my case, in Canada).  I have my income taxes taken directly from my pay (as do most people), which usually means that I get a refund as the amount withheld is based only on my salary, not the deductions I’m eligible for.

When I was working an ambulance for the volunteer fire department, we received an honorarium for the calls we did.  When the hamlet began reporting it correctly (and so deducting income tax) instead of just cutting us cheques, the amount withheld was based only on what the hamlet was paying us, not my combined salary, understandable as the hamlet didn’t know what my job’s pay was, and vice versa.  The result was that the amount withheld was lower than it should have been based on my total income, so instead of getting a deduction I had to pay a bit more to make up the difference (I’d also received a raise, which bumped my total income up into the next bracket).

So, I was paying more to the government but, of course, I was still making a buttload more money than I had a few years previously when I’d been getting refunds.  If you were of a certain mindset, you might overlook that second part (the total amount of money was still greater even taking into account taxes).

We went for six years without paying a cent in federal taxes.  That is because one of us was unemployed/underemployed/in school or all of the above for those years.

Then I graduated and got a better paying job.  Then my husband picked up more and more work for increasingly better pay, culminating in a full time permanent job about 2 months before the economy imploded.

Now we are paying off everything right and left, taking nice trips, buying things to replace things that saw us through the lean years and have collapsed, buying some toys, etc.  On the flip side, the downturn in the economy means that we spend less for all these things.

And we pay plenty in taxes, too, despite our mortgage and kids and other deductions that formerly wiped out our costs and then some.  So what?  For the first time in my life I am upper middle class, if not outright wealthy.  I should be paying taxes!

It also seems to be the case that many people, even people in business for themselves, believe they’re taxed on their gross revenue rather than their profit.

That’s true of the feds, but Washington state at least taxes gross business revenue.  Of course, we’re a conservative wet dream since we don’t have an income tax.

This person’s intelligence level falls between not wanting to be named in an article about deliberately making less money to scare off the Socialist Fairy and deliberately making less money to scare off the Socialist Fairy. They’re right next to each other on the extreme low end of the spectrum.

A great quote from BioShock regarding the complete unraveling of the Randian utopia:
“Everyone came to Rapture expecting to be captains of industry, but someone has to scrub the toilets.”

Why did I read this? Now I’ll probably have nightmares. That’s the scariest fucking game ever. The movie better be awesome.

This is pretty stupid but I don’t think it’s THE stupidest thing I’ve heard.  How many people buy lottery tickets every week?

I do, for the obvious reason that I get more entertainment value from fantasising about whatever the jackpot is that week than I do from an average DVD rental, with a comparable price.  Buying more than one - now that’s stupid.

[Client]:  How did the hearing on my case go?

[Lawyer]: I didn’t attend.

[Client]:What??!!

[Lawyer]: Yeah, at my hourly rate, that would have put me over $249,999.99 for the year, so I didn’t attend.

[Client]: Oh, God.  What happened at the hearing?

[Lawyer]: I don’t know.  I could open this letter from the Court, but that would put me over $249,999.99 for the year.

[Client]: Okay, do you think your secretary could get me the phone number for the Attorney Grievance Commission?

So, let me get this straight: She’s going to work harder to make less money because she hates “people” (read: racial minorities) she thinks are getting direct payments from the government that much?

If this behavior is genetic, evolutionary selection should actually weed it out.

I still play the lottery, but I call it the Idiot Tax.  I also know my state needs the money, so I can’t complain.  Especially since I can afford to give away the five or ten bucks I spend every month.  And no matter the odds, I still will go to a banker rather than a mathematician if I win.

As for the Galts Among Us: they’re bluffing.  They aren’t making this kind of money, aren’t brave enough to even try to go it alone, and are the kind of idiots who move to rural areas and then demand helicopters at the local hospitals, upgraded roads, better schools, more supermarkets, and all the other things that turn their twin ideals of independence and convenience come into conflict.  Some people love frontier living, while some people live to fuck up the frontier.

I was talking with my ex about people just not understanding the economic crisis.  Those who have struggled can see how to get by (income>spending works for most), but those who have tons of investments are in a full-fledged panic mode.  She works for an estates and trusts attorney and has seen and sat in on many client meetings ($300/hour for the attorney, $120 for the assistant) where the clients bitch about their investments going from $1.2M to a pauperish $800K.  These people have enough for a lifetime of comfort, own a home or two or six, but want more than that even though they’re in their sixties and seventies already.  I know I wouldn’t be happy if I saw a need to disinvest myself from four of six homes in this market, but I can’t imagine being a whiny turd about it.

The Galts Among Us are the same old survivalists with the same old Archie Bunker Mentality that tells them if they can run away from dealing with people who disagree with them, they’ll never have to confront the possibility that they may be selfish and frightened little children.  They want to build a fort in America’s back yard, only let the cool friends in, but they’ll still come in each night for supper and bedtime.  Or maybe not, if mom bought the big bag of Cheetos and it’s still warm out and the bugs aren’t biting much.

Really, the only people with any kind of disincentive to work and earn more are those people who are dependent on things like Medicaid and food stamps to survive.  They cap out at such a ridiculously low income level that it actually disincentivises you to work and earn more, considering that the cap for Medicaid is something like $850/month for an individual.  If you work for a company that doesn’t offer health benefits (and most low-paying jobs do not), you certainly can’t afford to buy health insurance on, say, $1,000/month.

So these rich fucks can go suck on it.  Try living on $850/month, food stamps and Medicaid or not.

Read the comments to that Angry Flower comic; pretty disgusting. Apparently heads of industry and the like are geniuses who could pick up cooking and agriculture within the week.

I subscribe more to the ‘Bioshock’ model. There’s this longing amongst the Liberatarian/Ayn Rand set for the idyllic lifestyle of the Greek philosophers or our Founding Fathers, ignoring the incredible free service infrastructure required for an uninterrupted life of the mind.

DTG in STL mentioned this already, but I think the people in question might actually be serious about thinking that going up a tax bracket means that your entire income is taxed at that rate. Of course, this could easily be resolved by reading the damned Wikipedia article:

An individual pays tax at a given bracket only for each dollar within that bracket’s range. For example, a single taxpayer who earned $10,000 in 2009 would be taxed 10% of each dollar earned from the 1st dollar to the 8,350th dollar (10% × $8,350 = $835.00), then 15% of each dollar earned from the 8,351th dollar to the 10,000th dollar (15% × $1,650 = $247.50), for a total of $1,082.50. Notice this amount ($1,082.50) is lower than if the individual had been taxed at 15% on the full $10,000 (for a tax of $1,500). This is because the individual’s marginal rate (the percentage tax on the last dollar earned, here 15%) has no effect on the income taxed at a lower bracket (here the first $8,350 of income taxed at 10%). This ensures that every rise in a person’s pre-tax salary results in an increase of his after-tax salary.

My brother, who earns way more than I do and is, in other domains, quite a clever guy, seems to have been working under this misapprehension—he was all cranky about moving up a bracket, even though only a tiny portion of his income would be taxed at that rate. He seemed surprised when I explained that to him.

Maybe this is a consequence of people rich enough to have complicated taxes not bothering to do them themselves? I’m pretty sure I learned this when filling out my own 1040 the first time.

I’m having a hard time wrapping my head around the idea that anyone would think that the tax system works this way—how screwed up would that make the incentives?! Given how much effort is put into shaping incentives through the tax system, it would be insanity to think that they’d implement the kind of tax system (if you make over x dollars, you pay y percent of the total in taxes) people seem to be talking about. But then, given all the other nonsense that seems to be common knowledge (poor people would get all nice, middle-class jobs if it wasn’t for welfare!), it’s not inconceivable.

3letterjon, that last paragraph made my quotefile. Delectable.

The problem is, if this person exists and isn’t just a figment of the RNC’s talking points for the day, they’re lying.  None of these fucking thieves would have the decency to actually do something on principal such as what is suggested here.  It’s just talk.

A shame though, it would be nice if more of these asshats took themselves out of society.

The thing to remember is that the top marginal rates used to be 70%.  There was a time when people could legitimately come to the conclusion that the extra money they made from working 80 hours a week instead of 50 hours a week wasn’t worth the amount they’d get to keep from the additional income.  At my job you get bonuses based on hours worked, and if the top marginal rate was still 70%, I could see someone deciding that the difference in bonuses for working 2300 hours a year versus 2000 hours a year wasn’t worth the extra effort.  But the top marginal rates have come down under 40%, so I don’t think you have as many people deciding the additional dollar isn’t worth the additional effort.  I just think the Galt-ers hold onto this phenomenon even though it doesn’t happen anymore.  They pretend 38% is the deterrent 70% used to be.

Read the comments to that Angry Flower comic; pretty disgusting. Apparently heads of industry and the like are geniuses who could pick up cooking and agriculture within the week.

Yeah, you saw that too huh? I thought it was funny myself, and my only regret is these people are never actually going to find out just how wrong they are.

...my only regret is these people are never actually going to find out just how wrong they are.

That’s what May 7 farms are for.

I do, for the obvious reason that I get more entertainment value from fantasising about whatever the jackpot is that week than I do from an average DVD rental, with a comparable price.  Buying more than one - now that’s stupid.

This. I play it too for the same reason, and the money goes to education so what the hell? Why not.

Two words, Counsel….....................................pro bono.

She’s a Republican—she works pro malo publico, when she works for free.

Why would that woman work to earn an extra dollar when the Feds are gonna take four more cents from it? Hell, she probably wouldn’t cross the street to pick up a stray twenty dollar bill—not worth the effort.

My parents had a small business, so I was accustomed to the difference between gross and net at an early age. After employee salaries and operating expenses were deducted, we netted about ten percent of the gross. Needless to say, we were taxed on the net income, not the gross.

“2. keshmeshi, I can’t believe that any polity actually taxes gross revenue. Too many business run a loss, and at the least it’s problematic to collect from an entity with negative cash flow. Washington state wouldn’t be such an entrepreneurial hotbed if that was actually the case.”

Michigan’s business tax kinda sorta works this way. The legislature keeps making noises about changing it, but won’t do it in a non-revenue neutral way. Why we don’t just bump the income taxes on the Fords, the Illilichs and, maybe, the Calvin Johnsons and Henrik Zetterbergs and reform damn the business tax, I haven’t yet figured out. Maybe the real Richie Riches are pulling some strings to make sure it doesn’t happen.

I don’t know enough of the ins and outs of state politics to pin the blame on Gov., the Dem-run state house or the Republican-run state senate, but somebody’s being either stupid or disingenious.

I’m reminded of a comic.

At my job you get bonuses based on hours worked, and if the top marginal rate was still 70%, I could see someone deciding that the difference in bonuses for working 2300 hours a year versus 2000 hours a year wasn’t worth the extra effort.

I think a couple of people above have alluded to this, but what’s wrong with people deciding that money isn’t everything and they’d rather use those 300 hours for their family or their hobbies if they’re not going to be making obscene amounts of money from working them?

(Not that you were implying that working that many hours is an unalloyed good—just riffing off what you said.)

Yeah, Mnemosyne, I’m in that situation.  I could make a considerable amount more.  I mean, not like an obscene amount, but maybe 15%-20% more.  But I, personally, have decided that I like leaving right at 5 and not having to work on weekends.  And it’s got nothing to do with marginal tax rates.  Even if the tax rate was zero, I wouldn’t be interested in the extra money that came with the extra hours.

“But I, personally, have decided that I like leaving right at 5 and not having to work on weekends.  And it’s got nothing to do with marginal tax rates.  Even if the tax rate was zero, I wouldn’t be interested in the extra money that came with the extra hours.”

...slacker.  Why do you hate America?...

(I decided the same thing a few years ago…)

Maybe this is a consequence of people rich enough to have complicated taxes not bothering to do them themselves?

Really, with the tax tables, even if you do your own taxes, I can see the lazy and/or bad at math not understanding this. You just plug your taxable income into the table and it tells you the final number. It doesn’t spell out that the first 10K was taxed at x rate, the next 10K at y . . .

ABC News has updated their story, with this comment:

“Editor’s Note: Yesterday ABC News published a version of this story which some readers felt did not provide a comprehensive enough analysis of Obama’s tax code for those families making $250k or more. ABCNews.com has heard those concerns and after review has decided to post an updated version of the story below.”

Except if you read it, the only obvious change I see is that some of the more ridiculous comments from the Galt-ers have been removed.

Histro-geek, I totally understand why people don’t do their own taxes, especially if they have a lot of deductions. I’m saying that even people who do their own taxes might not understand marginal tax rates because they’re just writing down the number from the tax table without understanding that the number represents lots of different marginal tax rates being applied.

DTG, from upthread:

To them, it is more important to do everything in their power to prevent the big, bad evil gubmint from getting their grubby hands on “their” money . .

I don’t mean to be rude, but this is totally misinformed.  There are different kinds of tax-free bonds, one of which is municipal bonds.  These can be broken down into two kinds: general obligation (GO) and revenue bonds.  Muni bonds exist to allow states, localities (say, a school district that encompasses more than one town) and U.S. territories to fund development projects they otherwise couldn’t finance through federal funds.  States issue muni bonds to fund highway expansion or to build a new bridge (likely revenue bonds because the bondholders would be paid interest using revenue from tolls) and localities issue bonds to pay for new schools (likely a GO bond because it would be backed by taxpayer dollars, via property taxes) and these projects obviously contribute to building healthy communities.  If you live in Alaska but you buy a California state muni bond, the interest on the bond is tax-free on the federal level, and you’re helping development in that state.  If you live in Alaska and buy an Alaska state muni bond, the bond interest is tax-free on the federal AND state level AND possibly local taxes.  If you live in Alaska and buy a Puerto Rico or Guam-issue muni bond, the interest is automatically tax-free on all three levels.

Rich people buy munis, and yes, they’re looking for the tax-free income.  Buying munis outside of a retirement vehicle (403b or 401K) if you don’t meet certain income levels means you won’t fall into the suitability requirements to be brokered such a security.  In other words, no one will sell them to you if you’re poor.  BUT!  If you invest in a retirement plan that holds mutual funds, it’s very likely that if you’re investing in a fixed income fund, it could hold some percentage of muni bonds.  And anyone who buys U.S. Treasury bonds automatically gets tax-free interest at the state and local level.  Why, I’ll bet some sensible, liberal, happy-to-pay-my-taxes pandagonians have money invested in mutual funds that hold T-bonds and munis at this very second!

So please.  Tax-free income is NOT synonymous with preventing the government from getting its hands on your money.  People who buy these securities are getting the tax breaks BECAUSE they’re giving money to some branch of government.

. . . than it is to maximize their return on investment by putting their money in higher yield products.

Again, I say wha???  High yield bonds, aka “junk bonds” are investments in (usually) corporate debt, although the term can apply to foreign government bonds if that country’s economy is in the crapper and the government has to pay out a high yield to get people to invest in its treasuries.  These are also held in retirement plans, and for people who are young and have a long time to recoup any losses they incur from investing, can be a very smart choice, just like emerging market equity can be.  But be careful what you ask for.  The companies issuing these bonds pay out high interest because they’re insolvent (or worse, illiquid) and need cash flow.  These companies could go under.  And then not only have you lost the future interest payments you were counting on to build your retirement income, you’ve lost the principal you invested, too.  Not everyone’s investment goals, income, age or life plans are suitable for these securities.  Buying them doesn’t guarantee you’ve “maximized” anything.

Cris: http://www.britannica.com/EBchecked/topic/370729/May-7-cadre-school

Av0gadro: Histro-geek, I totally understand why people don’t do their own taxes, especially if they have a lot of deductions. I’m saying that even people who do their own taxes might not understand marginal tax rates because they’re just writing down the number from the tax table without understanding that the number represents lots of different marginal tax rates being applied.

I can kind of see that… but you’d have to have those same people failing to notice that the numbers don’t undergo an enormous jump at the boundaries between marginal rates. I suppose I like fiddling with numbers more than the average taxpayer, but you’d think one of these people would have idly wondered what their taxes would be if they bumped into the next bracket—which is to say, remarkably close to their taxes if they didn’t do so.

1. Phoenecian, you can have the fantasy without buying a ticket.

No, you can’t.  Not really.  Each and every time I go window shopping, I can tell myself “You know, I might have X$ next week - would I buy that or that?”

Whenever lottery fever used to spread in my company, I’d broadcast an email: the lottery is a tax on people who are bad at math. Of course everyone blew me off, even though I was one of the wealthy owners and conspicuously good at math.

Yes, when I was young and snotty I said the same thing.  Then I grew up and realised that an additional $500 or so a year never changed anyones life, but being open to life changing possibilities actually did.

“Why kill yourself working if you’re going to give it all away to people who aren’t working as hard?”

Not only does she lack basic arithmetic skills, she is also completely unaware of what taxes are used for.  Those roads she is driving on, those police that protect her, those judges she sees every day, all those things are paid for by her taxes, and they benefit her as much as they benefit the poor people who she assumes are lazy.  She’s just a typical dumbass who expects the government to provide for her without realizing that they need to get the money somewhere.  Society is not a zero-sum game.  When poor people benefit, everyone benefits, including her.

If any of them would like to send me their excess after 250K I promise I will give it a good home.

Two things:

This is a game being played by people who know better to confuse people who don’t know better about how our marginal tax rate system works

Yup. Conservatives LIE. All the time, about anything. See Joe / not Joe the Plumber / not plumber… Doubt she is a lawyer, makes that kind of money and the way they lie, “she”  might not even be female!

“Everyone came to Rapture expecting to be captains of industry, but someone has to scrub the toilets.”

Well, no.  I think if you examine the Randian utopia as it lives in the mind of the average libertarian, you will find a nuclear family where Mom cleans the toilets and changes the diapers.  Because she’s good at it, of course.

Av0: “Histro-geek, I totally understand why people don’t do their own taxes, especially if they have a lot of deductions. I’m saying that even people who do their own taxes might not understand marginal tax rates because they’re just writing down the number from the tax table without understanding that the number represents lots of different marginal tax rates being applied.”

Warning, numbers ahead.

Not to support the bigger idea that you suddenly make a whole lot less money if you go over $250,000, but the tax table actually can give you this idea.

If the difference in the “tax you pay” column from row to row in a tax table is more than one dollar, there’s always going to be an amount where making one more dollar costs you more than a dollar.  Check http://www.irs.gov/pub/irs-pdf/i1040tt.pdf for the 2008 tax table and you will see the income levels are listed in $25 increments.

Example from this document (pp 72 ff):

income is at least   but less than your tax is
    1,300               1,325       131
    1,325               1,350       134

If your income is $1,324, you pay $131 in taxes for a net income after Federal tax of $1,193.
If your income is $1,325, you pay $134 in taxes for a net income after Federal tax of $1,191.

As you go further up the differences are bigger; the difference between 98,950 and 99,000 is $14.  Whee!

But this all is just a rounding, for people who have difficulty with the subtract, multiply, and add required to use the formula.  The marginal rates are built into the table.  There’s no huge jump at the margin amounts.

The tax table only goes up to 99,000; after this you are asked to use the tax computation table as you’re assumed to be either smart enough to do the math or well off enough to hire someone else who can.  So anyone who makes that assumption and makes anywhere near $250,000 can’t be familiar with her own taxes.  The tax rate schedules on page 92 make that super clear.

And as grendelkhan says, it’s not an enormous jump, it’s minor beans, but PROOF that the government is stealing your hard-earned bux.

Grr, I wrote “the difference between 98,950 and 99,000 is $14,” but meant “the difference in tax between 98,950 and 99,000 is $14.”

Y’all act like income restructuring to avoid taxes doesn’t really make sense and never happens.  Perhaps you might recall how former Senator John Edwards, once a favored candidate on this forum, formed an S Corporation to avoid about a half-million dollars in taxes.

As the top rate rises from 35% to 39.6% on direct income, it may become advantageous to take more of your compensation in other forms, forms which would be subject to other taxes rather than the income tax, such as dividends or stock, which if sold, is taxed at the much lower capital gains rate.  Depending upon income source, some wealthy people could make their money in overseas accounts or any number of sheltered things.

But Dana, you’re talking about income restructuring. 

You’re specifically not talking about just going home when you make dollar 249,999 and sitting around;  you’re spending your time or investing your money on something that is not taxed as highly.  So while you’re making more money, the Gummint is still taking a piece, just a smaller piece.

The result could be less total tax revenue for the Gummint than if you got it as salary/bonus.  But the Gummint still gets more money when you make more money.  And so do you.

Dana, perhaps, someday, conservatives will be intelligent enough to understand how marginal income tax rates work and honest enough to talk about restructuring income by the self-employed in order to lower their tax liabilities.

Today, however, is not that day, which is why this blog post is making fun of conservatives and journalists too stupid and too dishonest to understand and discuss the consequences of a new income tax regime.

I love (in the most sarcastic way possible) how when the playing field finally starts to get slightly more level after years and years of slowly turning this country into a feudal society they start yawping about “class warfare”!

As if what they’ve been engaging in slowly but surely for SO LONG (the destruction of the middle class and the rise of a monarchic uber-rich) isn’t at ALL “class warfare”.

F**KERS.

Dana, please to be seated and rotate.

Anyhow, let me just float this one out into the discussion:
Fact: Objectivism was founded by someone who said she rejected religion.
Hypothesis: Objectivism is a religion itself.
Null Hypothesis: Objectivism is not a religion.
Proof: Religious devotion to objectivism by its adherents and the refrain of “they weren’t a REAL objectivist/libertarian” if someone doesn’t succeed.  Further proof or proof to the contrary is accepted.
Result: Hypothesis is accepted.  Objectivism is a religion.

Well, no.  I think if you examine the Randian utopia as it lives in the mind of the average libertarian, you will find a nuclear family where Mom cleans the toilets and changes the diapers.  Because she’s good at it, of course.

Which is what the quote is about, though not specifically addressing the sexist nature of the belief.  Essentially, our take on this has refined the quote.  Fontaine was right, we just figured out why.

You know, it was one Dr. Helen started the movement…

“Who is Dr. Helen?”

No seriously, who the hell is she? - I asked myself only this morning. I really hadn’t the faintest idea. Which, even now, makes me even more terrified of her plot. The relative obscurity of this she-Galt is yet another chilling parallel to the hero of the prophetic 1300 pages masterpiece.

My feeble moocher mind recoils at the ominous sight of the now certain downfall of Socialist America, and manages to find fleeting comfort by revisiting a cliché of another atheistic tale: “The most merciful thing in the world… is the inability of the human mind to correlate all its contents” - an equally visionary, albeit far less talented writer than Ms. Rand, once proclaimed.

And merciful it is indeed, for it is this same inability that prevented me from discerning, since the 4th of November until this very day, the circuitous chain of events that inexorably links the nomination of Chairman Obama, the self-imposed income reduction of Dr. Helen, Michelle Malkin, and Glenn Reynolds, and the final collapse of our world.

Fellow parasites of the overmen, the origin of our ills is well known. As a dog often perishes from disease after affectionately licking the corpse of a recently dead relative, so too our twin species, Homo moochicus and Homo looticus, contracted a fatal illness because we couldn’t control our base inclination towards vain, misplaced, immoral concern for the destitute. These people were, we recognized too late, naught but walking cadavers, hopelessly beyond our help, whose sole purpose was to test the fiber of our noble selfishness. We failed.

Now that the the end is near, we must at least make a closing effort to understand the error of our ways. Let us draw upon the weak power of our uncreative minds to answer this question: which disturbance was the tipping point that has waken the Great Laissez-Faire Gods from their slumber? Was it the insolent 3.6% raise in the income tax? Is hubris to be found in the impious practice of economic necromancy, through which we raised the New Deal abomination? Assist me, brothers!

Wait! What was that?

It… it’s them! For the love of Kucinitch! I can’t bear it! They… are…shrugging…