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> Tim Cook’s tax rate on his $135 million bonus a few years ago was 52% This is the kind of selective data that makes this subject so infurating to argue about

> Tim Cook’s tax rate on his $135 million bonus a few years ago was 52% This is the kind of selective data that makes this subject so infurating to argue about. I'm sure this fact is true. But what you're trying to imply is that Tim Cook's overall tax payments were very high, and that's not remotely true at all! A bonus is one of the few bits of income he has, in fact, that is taxed as routine "income" that the rest of us pay. Almost everything the guy makes is in long term assets, and those are absolutely not taxed at 52%. Tim Cook shouldn't pay a lower tax rate than I do. And while I don't have numbers for Cook specifically, I'm pretty sure he does. Everyone in that world pays less tax than I do. And they shouldn't.

rayiner 6y ago
There’s nothing selective about my data. I gave the top line numbers—Biden’s proposal to eliminate the preferential capital gains rate on people with more than $1 million a year in income would raise only $50 billion annually. Cook’s bonus is just an illustration of why that number is so low—even very wealthy people make most of their money through ordinary income. Capital gains amounts to just 5% of all income. Most economists agree that capital gains should be taxed lower than ordinary income, which is why most developed countries including social democracies have preferential capital gains rates. And again, why do you care about the taxation of the super wealthy so much? Even if we taxed capital gains at the level of Denmark (9 points more than California) would raise less than $70 billion a year. Even Warren’s completely bonkers wealth tax (which would have had a top rate four times higher than Sweden did before it got rid of the wealth tax) would have raised only 10% of what Warren was proposing in new spending. Why spend so much time talking about a potential source of revenue that would do so little to actually increase the government’s ability to provide social services—even if we taxed the wealthy far in excess of European countries? It’s as massive effort in deception. People don’t want to put their money where their mouths are. They want Medicare for All—but only if someone else pays for it. If proponents of these social were forthright in asserting that wealth taxes or whatever would only pay for 10%, and European-style taxes on the middle class would be required to pick up the rest of the tab, support for these proposals would evaporate: https://www.cato.org/publications/commentary/millennials-socialism-until-they-get-jobs https://www.cato.org/publications/commentary/millennials-soc... > When tax rates are not explicit, millennials say they’d prefer larger government offering more services (54 percent) to smaller government offering fewer services (43 percent). However when larger government offering more services is described as requiring high taxes, support flips and 57 percent of millennials opt for smaller government with fewer services and low taxes, while 41 percent prefer large government. For what it’s worth, I’m pro paying higher taxes. I’d be happy to pay what people in Germany pay at my tax bracket. But only if middle class taxes also go up. Otherwise, there is no point—we won’t be able to tackle the big ticket items like universal healthcare without the trillions in revenue we could raise through a 10% VAT, a 10% payroll tax, etc.
- newacct583 6y ago
  > And again, why do you care about the taxation of the super wealthy so much? This is always the retreat: "OK, taxation is unfair, but you can't prove there's a problem so it doesn't really matter, does it?" I say: taxation is unfair, and we should make it fair instead of constantly trying to justify the fact that the very wealthy (who are, relative to US society, wealthier than they have ever been and getting steadily wealthier) are paying less tax than you or I do. Let's start there. To wit: why are you so invested in the regressiveness of current taxation policies? Shouldn't you at least accept that we should make it fair? If it was fair, maybe you'd have an easier time convincing the hippies not to try to pay for your health care or whatever.
  - rayiner 6y ago
    Most economists agree that taxing capital income lower is more efficient, and our capital gains rates are in line with those of Germany, Sweden, etc., so that all seems fine to me. I don’t want to be to the left of France or Italy on tax policy. That seems insane to me. Beyond that, taxes are just a means to an end. I accept that taxes are necessary for providing social services. So I find it extremely disingenuous to focus so much on a potential source of tax revenue that won’t cover 90% of what we need to provide universal healthcare, etc. I find it disingenuous when people like Warren talk about Medicare for All (which by her own math will cost $30 trillion over 10 years) and then spend the rest of the speech talking about wealth taxes (which by her own math would raise only $3-4 trillion over that same period), and then also promise not to raise taxes in the middle class. It’s rank manipulation: you’re trying to make voters believe we can pay for these services through higher taxes on the rich, and burying in the fine print the fact that the middle class will have to pay 90% of the bill. (This manipulation also undermines the prospect of us ever getting universal healthcare, because no real plan can achieve that without the massive middle class tax increases you’ve convinced voters are unnecessary.) The motivation seems to be more focused on taking money away from certain people (because “the billionaires shouldn’t exist” or some such tripe), than raising the money we need to pay for social services people supposedly want, and figuring out how to do that with minimal distortion to the economy. I think that’s a toxic brand of politics. It’s also a departure from what other developed countries are doing. Economists agree that the most efficient sort of tax is consumption taxes, which is why every OECD country relies heavily on VAT. (If our taxation profile was the same as Spain’s, payroll and consumption taxes would go up $2 trillion per year, while income taxes—paid mainly by the rich—would actually go down $1 trillion per year.) So this rhetoric seems both spiteful and empirically unwise.

rayiner 6y ago

There’s nothing selective about my data. I gave the top line numbers—Biden’s proposal to eliminate the preferential capital gains rate on people with more than $1 million a year in income would raise only $50 billion annually. Cook’s bonus is just an illustration of why that number is so low—even very wealthy people make most of their money through ordinary income. Capital gains amounts to just 5% of all income. Most economists agree that capital gains should be taxed lower than ordinary income, which is why most developed countries including social democracies have preferential capital gains rates. And again, why do you care about the taxation of the super wealthy so much? Even if we taxed capital gains at the level of Denmark (9 points more than California) would raise less than $70 billion a year. Even Warren’s completely bonkers wealth tax (which would have had a top rate four times higher than Sweden did before it got rid of the wealth tax) would have raised only 10% of what Warren was proposing in new spending. Why spend so much time talking about a potential source of revenue that would do so little to actually increase the government’s ability to provide social services—even if we taxed the wealthy far in excess of European countries? It’s as massive effort in deception. People don’t want to put their money where their mouths are. They want Medicare for All—but only if someone else pays for it. If proponents of these social were forthright in asserting that wealth taxes or whatever would only pay for 10%, and European-style taxes on the middle class would be required to pick up the rest of the tab, support for these proposals would evaporate: https://www.cato.org/publications/commentary/millennials-socialism-until-they-get-jobs https://www.cato.org/publications/commentary/millennials-soc... > When tax rates are not explicit, millennials say they’d prefer larger government offering more services (54 percent) to smaller government offering fewer services (43 percent). However when larger government offering more services is described as requiring high taxes, support flips and 57 percent of millennials opt for smaller government with fewer services and low taxes, while 41 percent prefer large government. For what it’s worth, I’m pro paying higher taxes. I’d be happy to pay what people in Germany pay at my tax bracket. But only if middle class taxes also go up. Otherwise, there is no point—we won’t be able to tackle the big ticket items like universal healthcare without the trillions in revenue we could raise through a 10% VAT, a 10% payroll tax, etc.

newacct583 6y ago
> And again, why do you care about the taxation of the super wealthy so much? This is always the retreat: "OK, taxation is unfair, but you can't prove there's a problem so it doesn't really matter, does it?" I say: taxation is unfair, and we should make it fair instead of constantly trying to justify the fact that the very wealthy (who are, relative to US society, wealthier than they have ever been and getting steadily wealthier) are paying less tax than you or I do. Let's start there. To wit: why are you so invested in the regressiveness of current taxation policies? Shouldn't you at least accept that we should make it fair? If it was fair, maybe you'd have an easier time convincing the hippies not to try to pay for your health care or whatever.
- rayiner 6y ago
  Most economists agree that taxing capital income lower is more efficient, and our capital gains rates are in line with those of Germany, Sweden, etc., so that all seems fine to me. I don’t want to be to the left of France or Italy on tax policy. That seems insane to me. Beyond that, taxes are just a means to an end. I accept that taxes are necessary for providing social services. So I find it extremely disingenuous to focus so much on a potential source of tax revenue that won’t cover 90% of what we need to provide universal healthcare, etc. I find it disingenuous when people like Warren talk about Medicare for All (which by her own math will cost $30 trillion over 10 years) and then spend the rest of the speech talking about wealth taxes (which by her own math would raise only $3-4 trillion over that same period), and then also promise not to raise taxes in the middle class. It’s rank manipulation: you’re trying to make voters believe we can pay for these services through higher taxes on the rich, and burying in the fine print the fact that the middle class will have to pay 90% of the bill. (This manipulation also undermines the prospect of us ever getting universal healthcare, because no real plan can achieve that without the massive middle class tax increases you’ve convinced voters are unnecessary.) The motivation seems to be more focused on taking money away from certain people (because “the billionaires shouldn’t exist” or some such tripe), than raising the money we need to pay for social services people supposedly want, and figuring out how to do that with minimal distortion to the economy. I think that’s a toxic brand of politics. It’s also a departure from what other developed countries are doing. Economists agree that the most efficient sort of tax is consumption taxes, which is why every OECD country relies heavily on VAT. (If our taxation profile was the same as Spain’s, payroll and consumption taxes would go up $2 trillion per year, while income taxes—paid mainly by the rich—would actually go down $1 trillion per year.) So this rhetoric seems both spiteful and empirically unwise.