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Like to bring this up when we talk taxes: I think it's totally crazy that we give the feds 25% or more and our states soo soo sooooo much less. I think it shoul

Like to bring this up when we talk taxes: I think it's totally crazy that we give the feds 25% or more and our states soo soo sooooo much less. I think it should be the other way around: 5% for the feds, and maybe 20% to the states. The reason is that our cities are filled with bums, and have absolutely no money to either give them jobs or make new programs. The feds don't give a shit and are busy making missiles or creating massive social programs that enrich the wrong people. I think the current strategy is broken. The other nice thing about this, is that we'd pay less in taxes AND the states/cities would be able to handle every damn thing it needs. It would be like 2x to 3x the money they are getting right now.

kevin_thibedeau 8y ago
But then the tax shelter states wouldn't be able to mooch off of federal programs.
- rhacker 8y ago
  There's going to be a lot of buts I get it. I want someone that can figure this out and move it forward.
throwaway284721 8y ago
The reason for this is that if one state has better social programs then another and higher taxes the poorest are going to move there, and the high earners are going to move away.
- AnthonyMouse 8y ago
  This doesn't seem to be a major problem for the EU, which has unrestricted internal migration but social programs are administered by the individual member states. The idea that the poor will mass migrate to California and the rich will mass migrate to South Dakota is pretty unrealistic. The poor can't afford to live in California even with social assistance, and the rich don't want to live in South Dakota no matter how low the taxes are. Because money buys stuff taxpayers want. Middle class people want good schools and functioning transit and to know they're going to have a secure retirement. The premise of having the government do these things is that they can do them at least as well as the market. If they succeed they'll have no trouble attracting people to come there and pay taxes in exchange for receiving those services. If they fail and are then out-competed by other states that do better, whether by leaving things to the market or otherwise, isn't that a good thing? It requires the underperforming states to improve or lose population.
  - lazulicurio 8y ago
    > This doesn't seem to be a major problem for the EU, which has unrestricted internal migration but social programs are administered by the individual member states I might be off the mark here, but from my understanding wasn't unrestricted migration one of the big drivers behind Brexit? Or at least the idea that the "poor countries" were "taking advantage" of the "rich countries"?
    - mamon 8y ago
      My understanding is that unrestricted immigration has the opposite effect: rich countries taking advantage of poor ones, via “brain drain”. That’s why the average age of medicine doctors in Poland seems to be around 50: all the younger ones went to Germany or Scandinavia. It’s true for blue collar workers as well: try hiring a contractor to remodel your house and then watch them leave the job unfinished because they got a better paying gig in UK (that actually happened to a friend of mine)
      - sparkling 8y ago
        Both is true. There is brain drain as well as welfare migration. My hometown in Germany with a population of ~300k now has ~11k migrants from Romania und Bulgaria. Aside from various social problems this is also a big strain on the social systems. 85%+ of households are dependent on child support checks.
        distances 8y ago
        There's also the fact that Western European countries desperately need immigration for covering future pensions. Countries like Germany and Finland are the next to follow Japan's crippling issues with aging population and poor dependency ratio.
    - AnthonyMouse 8y ago
      A lot of the drivers behind Brexit have a tenuous relationship to facts. There are some legitimate reasons to leave, but there are also self-interested parties telling people the lies they want to be told. And "mistaken people believe this" is no support for a position. The thing about rich people moving to places with lower taxes and poor people moving to places with more services is that it's the sort of thing that seems intuitively obvious until you actually think about it, and you realize it's like arguing that lakes are impossible because water evaporates. It's not that water doesn't evaporate. It's not that poor people don't prefer more services and rich people don't prefer lower taxes. It's that everything is not one dimensional and there are other factors that outweigh that one by enough that the lake is still full of water.
- illvm 8y ago
  The poorest in the US do not have the resources to simply pick up and move.
- Mvandenbergh 8y ago
  See for instance, the flood of high earners moving from NY and California to Wyoming.
- dsfyu404ed 8y ago
  >and the high earners are going to move away. Expand your timeline. Those high earners will screw up the economy of their destination state accidentally gutting the lower middle class, institute social programs to deal with the all the problems this creates, realized they just created the same dystopia they fled and move again. It's like a perverse form of rolling upgrades. You can see this process in action in places like CO and the PNW states which are starting to flip from "rich people move here" to "poor people move here". TX will probably start flipping soon. Major urban areas with lots of job opportunity seem vacuum up the wealthy regardless of the state wide trend (no matter how bad NY state gets upper middle class people in search of a lucrative career will be moving to NYC). I'm not sure how that plays into things.
thorwasdfasdf 8y ago
This.
AlexTWithBeard 8y ago
our cities are filled with bums, and have absolutely no money to either give them jobs or make new programs. New York City spends about $30k per homeless and you still cannot walk a block without seeing one. It's not about the money...
- deleted 8y ago
  [deleted]
- jon_richards 8y ago
  If New York was more efficient with that money and took half the homeless people off the streets, they'd be paying about 60k per homeless person.
- SolaceQuantum 8y ago
  IIRC New York City actually has higher rates of housing/sheltering homeless than most other cities in the USA. However, due to population size + density it would still be possible to see the homeless people who refuse/cannot access housing fairly regularly if one lives in or commutes to the densest areas. (For example, I've only ever seen homeless people in the heart of manhattan. I commute to Astoria and Flushing and long island fairly often and hardly ever/never see homeless people there.)
jdmichal 8y ago
This is actually a huge lever of control for the federal government, and I think has contributed greatly to increase of federal power over the states. The reason being that states can tap into that large federal stream... If they meet the federal criteria. This kind of carrot system is actually how many federal laws that seem to effect the states work. For instance, no state was ever mandated to implement the No Child Left Behind act. They just wouldn't get federal education funding if they didn't... Transportation is another area where this is pretty common.
- bilbo0s 8y ago
  Yeah, but then we'd just be dominated by states like Minnesota, California, Delaware, New York, etc. Basically, ginormous pools of money would start to build in the old Union and out on the west coast. But almost everyone in the middle would be hosed. (I mean places like Oklahoma and Colorado would likely be pretty happy, but everyone else would take substantial financial hits.)
  - AnthonyMouse 8y ago
    > Yeah, but then we'd just be dominated by states like Minnesota, California, Delaware, New York, etc. Basically, ginormous pools of money would start to build in the old Union and out on the west coast. But almost everyone in the middle would be hosed. Not really. States like California are net payers, but only just, because they have large diverse populations and end up getting back almost all of what they pay in. It's true that a lot of the middle states are net recipients, but most of them are still below $4000 per capita. And the bigger problem is that so much of the money is wasted. Each Congressman goes to Washington to bring back pork, and they do, but pork is inefficient. So they bring back $10,000 per capita in funding after paying in $6000, but only $5000 of the $10,000 is put to productive use. Does that really help the states compared to just keeping their original $6000 and using all of it productively because you don't have to negotiate with 49 other states for how to spend your own money?
    - JamesBarney 8y ago
dkural 8y ago
who are the "wrong people" that massive social programs enrich? Can you give an example? Most of federal spending is medicare, medicaid and social security; which are immensely popular with voters of all kind.
- bilbo0s 8y ago
  >Most of federal spending is medicare, medicaid and social security... Well, there's also Defense, and then service payments on the debt. Those are the big 3 without question. So "the wrong people" must be in there somewhere? But the real reason we give more to the feds is because if we didn't it would be AWESOME for places like New York, Minnesota, Texas, Delaware, California etc, and TERRIBLE for places like Wisconsin, Alabama, South Carolina, and Florida.
  - lg 8y ago
    and yet the first group of states votes in politicians that raise taxes and the second group votes in politicians that cut taxes?
    - zeckalpha 8y ago
      Those states also pay more to the federal government than they get back.
    - eigenstuff 8y ago
      That second group of states is half states in the black belt. Those state governments are bought and paid for and their people largely disenfranchised, same for much of Appalachia. (Like, c'mon, Mississippi is around 40% African American, you really think them electing Donald Trump reflects the true will of the people? Of course not!) They're run by shitty rich people with shitty agendas who are just out to further enrich themselves and have a vested interest in maintaining the power structures that be. That's why the South "votes against its own interests." It's literally a narrative invented by the coal industry so it could justify and get away with brutalizing West Virginia and leaving it far worse off than it was before. Coal owns WV all the way down to the school boards and sherrifs.
jedberg 8y ago
The whole point of allowing people to deduct their state tax payments was to solve exactly this problem. Let the states that want to tax more and provide more social services do so without harm to their citizens. Of course that deduction is gone now, which just further solidifies government power.
- bilbo0s 8y ago
  My own suspicion is that we got rid of that because government wants to harm the citizens of certain states. That's likely one of the benefits of having federal power, the ability structure the system to perpetuate your hold on it. In the US, our politicians do this all the time.
  - jedberg 8y ago
    Well, there are actually good arguments to be made on both sides of the issue. For example, one argument is, "why should people who live in high cost states pay less federal tax for the same federal services?" The counter-argument being "they don't need as many government services since they get the same benefits from their state" and also "their incomes are higher so their total dollar contribution is still just as high". It's a tough issue. From the Federal perspective is makes a lot of sense to get rid of the SALT deductions, and I suspect the next time the Dems are in charge they will "be unable" to restore the deduction for "reasons", since both parties want the extra revenue.
  - ddxxdd 8y ago
    My alternative suspicion is that SALT harms smaller and poorer states, since they can't lower local taxes to attract large businesses without also raising those businesses' federal taxes.
- asciident 8y ago
  Not sure how states taxing more don't harm their own citizens. If I make $100, with 30% federal tax, then I keep $70. If my state raises their tax from 0% to 20%, then I pay $20 to the state, deduct that from my $100 to get $80, and pay $30 on that which is $24. So I keep $56.
alehul 8y ago
When people who are fans of the "Scandinavian model" in the U.S. try and hype it up, this is what they seldom understand (or at least publicly recommend). In Sweden, until you hit ~$65,000 in yearly income, all of the taxes you pay on income (which is a relatively high rate) goes to your local government. Only after that point, your extra income goes to the federal government. [1] This model cuts out the immensely large federal government which serves as a middle-man for distributing the income you contribute to your local community, while simultaneously sucking out so much of it— either siphoning it to federal causes, or people's salaries chipping away at it as it's sloshed around. It's much more efficient when the majority of your income taxes support your local community directly. In the U.S. right now, these localities rely on property taxes, which is _much_ smaller of an income stream. People supporting the Scandinavian model should understand that this is necessary, and that's even more true when your country is larger. [1] https://www.nordisketax.net/main.asp?url=files/sve/eng/i07.asp https://www.nordisketax.net/main.asp?url=files/sve/eng/i07.a... Heard this point from Swedish family and having trouble finding it online, but the typical municipality income tax is 29-34% and corresponds to equivalent tax deductions from federal taxation, which seems to effectively have the same (or near same) result.
- cjrp 8y ago
  Is there some kind of balancing which prevents the nice areas (i.e. containing more affluent people) from becoming really nice, and the poorer areas becoming worse?
  - alehul 8y ago
    Good question! I wondered the same. There isn’t explicitly, and I know that’s part of what the federal top-down model tries to prevent, but is it really working? The United States’ affluent areas are night-and-day to the poor ones. If we think about the per-capita income in poorer areas of the States, and what can be taxed off of that, it seems like it’s still enough for that community to function. The current U.S. model seems to result in everyone getting a much smaller pie, even if the government manages to change the portions of who gets what.
deleted 8y ago
[deleted]
austincheney 8y ago
> or more and our states soo soo sooooo much less That is a perspective from somebody living in a place with state income tax. Life is so much better when you are not paying state income taxes. Texas, Florida, and a few other places have no state income taxes.
- cheschire 8y ago
  Your reply is to a post that is talking about taxes generally, not income taxes specifically. Texas has no income tax, but has sales[0] and property[1] taxes that are above the national average, as well as tolls on many public[2] roads. Texans are heavily taxed, but in ways which are based on overall footprint/usage rather than the ham-fisted distribution of income taxes that other states prefer. I agree with your assertion that life is better because of that. 0: https://taxfoundation.org/state-and-local-sales-tax-rates-2018/ https://taxfoundation.org/state-and-local-sales-tax-rates-20... 1: https://www.thebalance.com/best-and-worst-states-for-property-taxes-3193328 https://www.thebalance.com/best-and-worst-states-for-propert... 2: https://en.wikipedia.org/wiki/List_of_toll_roads_in_Texas#Operating_agencies https://en.wikipedia.org/wiki/List_of_toll_roads_in_Texas#Op...
dhimes 8y ago
This is a cornerstone of traditionally "conservative" viewpoints in the US. I am now in favor as well.

kevin_thibedeau 8y ago

But then the tax shelter states wouldn't be able to mooch off of federal programs.

rhacker 8y ago
There's going to be a lot of buts I get it. I want someone that can figure this out and move it forward.

throwaway284721 8y ago

The reason for this is that if one state has better social programs then another and higher taxes the poorest are going to move there, and the high earners are going to move away.

AnthonyMouse 8y ago
This doesn't seem to be a major problem for the EU, which has unrestricted internal migration but social programs are administered by the individual member states. The idea that the poor will mass migrate to California and the rich will mass migrate to South Dakota is pretty unrealistic. The poor can't afford to live in California even with social assistance, and the rich don't want to live in South Dakota no matter how low the taxes are. Because money buys stuff taxpayers want. Middle class people want good schools and functioning transit and to know they're going to have a secure retirement. The premise of having the government do these things is that they can do them at least as well as the market. If they succeed they'll have no trouble attracting people to come there and pay taxes in exchange for receiving those services. If they fail and are then out-competed by other states that do better, whether by leaving things to the market or otherwise, isn't that a good thing? It requires the underperforming states to improve or lose population.
- lazulicurio 8y ago
  > This doesn't seem to be a major problem for the EU, which has unrestricted internal migration but social programs are administered by the individual member states I might be off the mark here, but from my understanding wasn't unrestricted migration one of the big drivers behind Brexit? Or at least the idea that the "poor countries" were "taking advantage" of the "rich countries"?
  - mamon 8y ago
    My understanding is that unrestricted immigration has the opposite effect: rich countries taking advantage of poor ones, via “brain drain”. That’s why the average age of medicine doctors in Poland seems to be around 50: all the younger ones went to Germany or Scandinavia. It’s true for blue collar workers as well: try hiring a contractor to remodel your house and then watch them leave the job unfinished because they got a better paying gig in UK (that actually happened to a friend of mine)
    - sparkling 8y ago
      Both is true. There is brain drain as well as welfare migration. My hometown in Germany with a population of ~300k now has ~11k migrants from Romania und Bulgaria. Aside from various social problems this is also a big strain on the social systems. 85%+ of households are dependent on child support checks.
      - distances 8y ago
        There's also the fact that Western European countries desperately need immigration for covering future pensions. Countries like Germany and Finland are the next to follow Japan's crippling issues with aging population and poor dependency ratio.
  - AnthonyMouse 8y ago
    A lot of the drivers behind Brexit have a tenuous relationship to facts. There are some legitimate reasons to leave, but there are also self-interested parties telling people the lies they want to be told. And "mistaken people believe this" is no support for a position. The thing about rich people moving to places with lower taxes and poor people moving to places with more services is that it's the sort of thing that seems intuitively obvious until you actually think about it, and you realize it's like arguing that lakes are impossible because water evaporates. It's not that water doesn't evaporate. It's not that poor people don't prefer more services and rich people don't prefer lower taxes. It's that everything is not one dimensional and there are other factors that outweigh that one by enough that the lake is still full of water.
illvm 8y ago
The poorest in the US do not have the resources to simply pick up and move.
Mvandenbergh 8y ago
See for instance, the flood of high earners moving from NY and California to Wyoming.
dsfyu404ed 8y ago
>and the high earners are going to move away. Expand your timeline. Those high earners will screw up the economy of their destination state accidentally gutting the lower middle class, institute social programs to deal with the all the problems this creates, realized they just created the same dystopia they fled and move again. It's like a perverse form of rolling upgrades. You can see this process in action in places like CO and the PNW states which are starting to flip from "rich people move here" to "poor people move here". TX will probably start flipping soon. Major urban areas with lots of job opportunity seem vacuum up the wealthy regardless of the state wide trend (no matter how bad NY state gets upper middle class people in search of a lucrative career will be moving to NYC). I'm not sure how that plays into things.

thorwasdfasdf 8y ago

This.

AlexTWithBeard 8y ago

our cities are filled with bums, and have absolutely no money to either give them jobs or make new programs. New York City spends about $30k per homeless and you still cannot walk a block without seeing one. It's not about the money...

deleted 8y ago
[deleted]
jon_richards 8y ago
If New York was more efficient with that money and took half the homeless people off the streets, they'd be paying about 60k per homeless person.
SolaceQuantum 8y ago
IIRC New York City actually has higher rates of housing/sheltering homeless than most other cities in the USA. However, due to population size + density it would still be possible to see the homeless people who refuse/cannot access housing fairly regularly if one lives in or commutes to the densest areas. (For example, I've only ever seen homeless people in the heart of manhattan. I commute to Astoria and Flushing and long island fairly often and hardly ever/never see homeless people there.)

jdmichal 8y ago

This is actually a huge lever of control for the federal government, and I think has contributed greatly to increase of federal power over the states. The reason being that states can tap into that large federal stream... If they meet the federal criteria. This kind of carrot system is actually how many federal laws that seem to effect the states work. For instance, no state was ever mandated to implement the No Child Left Behind act. They just wouldn't get federal education funding if they didn't... Transportation is another area where this is pretty common.

bilbo0s 8y ago
Yeah, but then we'd just be dominated by states like Minnesota, California, Delaware, New York, etc. Basically, ginormous pools of money would start to build in the old Union and out on the west coast. But almost everyone in the middle would be hosed. (I mean places like Oklahoma and Colorado would likely be pretty happy, but everyone else would take substantial financial hits.)
- AnthonyMouse 8y ago
  > Yeah, but then we'd just be dominated by states like Minnesota, California, Delaware, New York, etc. Basically, ginormous pools of money would start to build in the old Union and out on the west coast. But almost everyone in the middle would be hosed. Not really. States like California are net payers, but only just, because they have large diverse populations and end up getting back almost all of what they pay in. It's true that a lot of the middle states are net recipients, but most of them are still below $4000 per capita. And the bigger problem is that so much of the money is wasted. Each Congressman goes to Washington to bring back pork, and they do, but pork is inefficient. So they bring back $10,000 per capita in funding after paying in $6000, but only $5000 of the $10,000 is put to productive use. Does that really help the states compared to just keeping their original $6000 and using all of it productively because you don't have to negotiate with 49 other states for how to spend your own money?
  - JamesBarney 8y ago

dkural 8y ago

who are the "wrong people" that massive social programs enrich? Can you give an example? Most of federal spending is medicare, medicaid and social security; which are immensely popular with voters of all kind.

bilbo0s 8y ago
>Most of federal spending is medicare, medicaid and social security... Well, there's also Defense, and then service payments on the debt. Those are the big 3 without question. So "the wrong people" must be in there somewhere? But the real reason we give more to the feds is because if we didn't it would be AWESOME for places like New York, Minnesota, Texas, Delaware, California etc, and TERRIBLE for places like Wisconsin, Alabama, South Carolina, and Florida.
- lg 8y ago
  and yet the first group of states votes in politicians that raise taxes and the second group votes in politicians that cut taxes?
  - zeckalpha 8y ago
    Those states also pay more to the federal government than they get back.
  - eigenstuff 8y ago
    That second group of states is half states in the black belt. Those state governments are bought and paid for and their people largely disenfranchised, same for much of Appalachia. (Like, c'mon, Mississippi is around 40% African American, you really think them electing Donald Trump reflects the true will of the people? Of course not!) They're run by shitty rich people with shitty agendas who are just out to further enrich themselves and have a vested interest in maintaining the power structures that be. That's why the South "votes against its own interests." It's literally a narrative invented by the coal industry so it could justify and get away with brutalizing West Virginia and leaving it far worse off than it was before. Coal owns WV all the way down to the school boards and sherrifs.

jedberg 8y ago

The whole point of allowing people to deduct their state tax payments was to solve exactly this problem. Let the states that want to tax more and provide more social services do so without harm to their citizens. Of course that deduction is gone now, which just further solidifies government power.

bilbo0s 8y ago
My own suspicion is that we got rid of that because government wants to harm the citizens of certain states. That's likely one of the benefits of having federal power, the ability structure the system to perpetuate your hold on it. In the US, our politicians do this all the time.
- jedberg 8y ago
  Well, there are actually good arguments to be made on both sides of the issue. For example, one argument is, "why should people who live in high cost states pay less federal tax for the same federal services?" The counter-argument being "they don't need as many government services since they get the same benefits from their state" and also "their incomes are higher so their total dollar contribution is still just as high". It's a tough issue. From the Federal perspective is makes a lot of sense to get rid of the SALT deductions, and I suspect the next time the Dems are in charge they will "be unable" to restore the deduction for "reasons", since both parties want the extra revenue.
- ddxxdd 8y ago
  My alternative suspicion is that SALT harms smaller and poorer states, since they can't lower local taxes to attract large businesses without also raising those businesses' federal taxes.
asciident 8y ago
Not sure how states taxing more don't harm their own citizens. If I make $100, with 30% federal tax, then I keep $70. If my state raises their tax from 0% to 20%, then I pay $20 to the state, deduct that from my $100 to get $80, and pay $30 on that which is $24. So I keep $56.

alehul 8y ago

When people who are fans of the "Scandinavian model" in the U.S. try and hype it up, this is what they seldom understand (or at least publicly recommend). In Sweden, until you hit ~$65,000 in yearly income, all of the taxes you pay on income (which is a relatively high rate) goes to your local government. Only after that point, your extra income goes to the federal government. [1] This model cuts out the immensely large federal government which serves as a middle-man for distributing the income you contribute to your local community, while simultaneously sucking out so much of it— either siphoning it to federal causes, or people's salaries chipping away at it as it's sloshed around. It's much more efficient when the majority of your income taxes support your local community directly. In the U.S. right now, these localities rely on property taxes, which is _much_ smaller of an income stream. People supporting the Scandinavian model should understand that this is necessary, and that's even more true when your country is larger. [1] https://www.nordisketax.net/main.asp?url=files/sve/eng/i07.asp https://www.nordisketax.net/main.asp?url=files/sve/eng/i07.a... Heard this point from Swedish family and having trouble finding it online, but the typical municipality income tax is 29-34% and corresponds to equivalent tax deductions from federal taxation, which seems to effectively have the same (or near same) result.

cjrp 8y ago
Is there some kind of balancing which prevents the nice areas (i.e. containing more affluent people) from becoming really nice, and the poorer areas becoming worse?
- alehul 8y ago
  Good question! I wondered the same. There isn’t explicitly, and I know that’s part of what the federal top-down model tries to prevent, but is it really working? The United States’ affluent areas are night-and-day to the poor ones. If we think about the per-capita income in poorer areas of the States, and what can be taxed off of that, it seems like it’s still enough for that community to function. The current U.S. model seems to result in everyone getting a much smaller pie, even if the government manages to change the portions of who gets what.

deleted 8y ago

[deleted]

austincheney 8y ago

> or more and our states soo soo sooooo much less That is a perspective from somebody living in a place with state income tax. Life is so much better when you are not paying state income taxes. Texas, Florida, and a few other places have no state income taxes.

cheschire 8y ago
Your reply is to a post that is talking about taxes generally, not income taxes specifically. Texas has no income tax, but has sales[0] and property[1] taxes that are above the national average, as well as tolls on many public[2] roads. Texans are heavily taxed, but in ways which are based on overall footprint/usage rather than the ham-fisted distribution of income taxes that other states prefer. I agree with your assertion that life is better because of that. 0: https://taxfoundation.org/state-and-local-sales-tax-rates-2018/ https://taxfoundation.org/state-and-local-sales-tax-rates-20... 1: https://www.thebalance.com/best-and-worst-states-for-property-taxes-3193328 https://www.thebalance.com/best-and-worst-states-for-propert... 2: https://en.wikipedia.org/wiki/List_of_toll_roads_in_Texas#Operating_agencies https://en.wikipedia.org/wiki/List_of_toll_roads_in_Texas#Op...

dhimes 8y ago

This is a cornerstone of traditionally "conservative" viewpoints in the US. I am now in favor as well.