...continued from http://news.ycombinator.com/item?id=4333008 http://news.ycombinator.com/item?id=4333008 This is simply raw data and basic arithmetic. No mag

...continued from http://news.ycombinator.com/item?id=4333008 http://news.ycombinator.com/item?id=4333008 This is simply raw data and basic arithmetic. No magic. No funny business. And, yes, I am not even adding-on the interest on our debt. If this doesn't make the "let's tax the rich" crowd reconsider their ideas I don't really know what would. There is no way to pull out of this mess thorough taxation without SEVERE spending cuts. Fire-up Excel and do the math yourself. Unless you create some kind of an alternate reality with different mathematical theories, the results should be pretty darn close to these. Also note that I was very generous and proposed paying off the debt in half a century. That's a long time. Well, OK, how can we make this happen? Easy math: No tax increases and cut $1,800,000,000,000 in spending every year, for the next 50 years, from the Federal budget. Fifty years. In half a century we would be solvent again. If that doesn't make you sick in the stomach you are stronger than I am. OK, let's just get back to a balanced budget and raise taxes to deal with the rest: Cut spending by $1,500,000,000,000 every year for the next fifty years. Pass a balanced budget amendment to force the issue. How much do we have to raise in annual tax revenues in order to be debt-free in fifty years? $ 300,000,000,000 Annual obligation, every year for 50 years: $300,000,000,000 Now 100% of this will be paid through tax increases. How much if we tax everyone at or above a certain annual income equally? 200,000 $76,443 500,000 $411,268 1,000,000 $1,266,448 1,500,000 $2,329,428 2,000,000 $3,549,708 5,000,000 $13,276,686 10,000,000 $36,258,158 It doesn't really work at all, does it? Remember, this is tax money due ABOVE what these people are already paying. OK, let's go with the same progressive approach as used before: bracket share of burden corresponding amount per taxpayer,per year percent of total income $200,000 - $500,000 1% 3,000,000,000 938.96 0.5% 0.2% $500,000 - $1,000,000 2% 6,000,000,000 12,181.06 2.4% 1.2% $1,000,000 - $1,500,000 4% 12,000,000,000 111,012.43 11% 7% $1,500,000 - $2,000,000 8% 24,000,000,000 542,091.12 36% 27% $2,000,000 - $5,000,000 10% 30,000,000,000 484,511.77 24% 10% $5,000,000 - $10,000,000 25% 75,000,000,000 5,236,698.79 105% 52% $10,000,000 or more 50% 150,000,000,000 18,129,079.04 181% 181% Once again, it looks good in the beginning but falls apart very quickly as you go up the tax brackets. This is not workable. By this time you should have a solid idea that we've been spending and borrowing money like drunken sailors for a long time. Even with a fifty year timeline we can't fix this problem through taxation. At least not if your goal is to tax the "rich". When I hear politicians parrot the phrase "fair share" I, to quote Pink Floyd, get filled with the urge to defecate. It sure is a nice phrase to pound into the heads of the masses who, non interested in looking at even simple data and doing some math, seem to swallow this shit up and get behind it. "Fair share"? What the fuck is that? "Fair share" is when we each pay for what we eat at the restaurant. Would it be fair for me to pay for someone else's meal just because I earn more? Not really. "Fair share" might be that my neighbor and I split the cost of rebuilding our common fence. Each pays half of it. That's fair. "Fair share" could also mean that if I break something I get to pay for it. That's fair. Asking those who make more to hand over 90% (or more) of their income in order to cover our drunken-sailor spending spree isn't "fair" in any measuring system anyone might care to concoct. It is beyond obvious when one looks at the data and applies just a little basic math that the first thing that needs to go is the spending. And, yes, it will hurt, but it needs to go. If we did that, if we cut $1,500,000,000,000 from the Federal budget every year, we'd still have to come-up with $300,000,000,000 every year for the next 50 years to become debt-free. About 140,000,000 tax returns filed every year. If we all pay the same portion of the $300,000,000,000 we would all have to pay $2,143 per year, every year, for the next fifty years. Am I driving home just how bad this problem is? A progressive taxation system could be used to reduce the burden on those earning less, but you can't start at the $200,000 bracket, that simply won't cut it. Everyone has to pay something and, even then, it looks ridiculous: bracket share of burden per taxpayer, per year Under 5000 0.00% - $5,000 - $10,000 0.00% - $10,000 - $15,000 0.00% - $15,000 - $20,000 1.00% 197.36 $20,000 - $25,000 2.00% 448.48 $25,000 - $30,000 2.00% 519.49 $30,000 - $35,000 2.00% 585.98 $35,000 - $40,000 2.00% 672.43 $40,000 - $45,000 3.00% 1,158.03 $45,000 - $50,000 3.00% 1,358.82 $50,000 - $55,000 3.00% 1,484.21 $55,000 - $60,000 3.00% 1,639.11 $60,000 - $75,000 7.00% 1,570.46 $75,000 - $100,000 7.00% 1,373.90 $100,000 - $200,000 7.00% 1,164.76 $200,000 - $500,000 7.00% 4,929.52 $500,000 - $1,000,000 7.00% 31,975.28 $1,000,000 - $1,500,000 7.00% 145,703.82 $1,500,000 - $2,000,000 7.00% 355,747.30 $2,000,000 - $5,000,000 10.00% 363,383.83 $5,000,000 - $10,000,000 10.00% 1,571,009.64 $10,000,000 or more 10.00% 2,719,361.86 Total share: 100% Remember, you are looking at something we'd have to do for fifty years. To paraphrase Ross Perot, the sound you would hear would be the huge sucking sound of jobs, innovation, investment and people leaving our country. For fifty years. The solution is painful and obvious: Cut spending and cut it to the bone. In other words, what every family has to do: Live within or below your means. It is high time that we act like adults and do what must be done. We are looking at fifty years of agony no-matter what. We need to tell unions to go pound sand and forget about their luxury pensions and benefits. We need to fire government workers en-masse and compel them to become more useful members of society. We need to end ridiculous government workers pensions, benefits and spending. We need to end entitlement programs as they exist today. We need to cut, cut, cut and then cut some more. Above all, we also need to go back to being the most entrepreneurial and business-friendly nation in the world. We need to make it so attractive to do business in the US that we usher-in a new age of technological and entrepreneurial revolution. We do that and we might just be able to deal with our problems in 25 years instead of 50. There are a million different ways to look at this problem, but I feel that the fundamental numbers are inescapable. Add interest payments and other costs I did not account for and the picture is even worst. So, yes, going back to the article that is the subject of this thread: 1.5% spending reduction? What a joke!