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  1. #1

    Do the rich pay taxes?

    On another thread the topic of how much tax the rich pay came up. According to everyone but me, the rich do not pay any taxes, they simply raise the price of the good they produce to cover for the tax hike.

    Here's an example:

    "The rich do not pay taxes, we pass the cost of taxes over to the consumers. I am retired, and 90% of my income comes from rental income. If tax rates go up, then rents will go up - plain and simple."

    I can understand the business owner would try pass the cost on to the consumer but doesn't this violate the basic laws of supply and demand? If you raise the price of a good, demand for that good will fall and your profits wil be reduced at some point, correct?

    Suppose you sell widgets. Your cost is $1 and you sell the widgets for $2 and the tax rate is 0%. The demand for those widgets is 1 million in a year so you make a profit of a million dollars. Now suppose the tax rate is 50%. So you raise the price of the widget to $3 to cover the tax increase. But here's the catch. At 3$ a widget you can't sell 1 million widgets! So your profit gets reduced. So you ARE paying taxes.



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  3. #2
    To begin, you're conflating "the rich" with "business owners".

    But I think your question is about what business owners do, so I'll take a stab at that.

    Businesses divide their income up into segments (labor, cost of manufacturing, taxes, capital projects, insurance, profit...) When any one of those inputs goes up, they can either spend less on one of the other inputs, or they can raise the price of their product. It's a balancing act every business has to perform. They can't raise their prices too much or people will buy from their competitors. But they have to do something.

    The thing about taxes is that all of their competitors have the same price increase as they do, so raising their prices won't really matter since their competitors face the same thing. But what happens in the real world is that certain businesses write the laws that allow them to not have to pay those taxes. (special interest tax breaks and deductions) It ends up hurting small businesses which reduces competition for large corporations.

    Ironically, it has the exact opposite effect of what progressives want. Which is why the larger our government gets, the more powerful corporations get.
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  4. #3
    Quote Originally Posted by CaptUSA View Post
    To begin, you're conflating "the rich" with "business owners".
    The thing about taxes is that all of their competitors have the same price increase as they do, so raising their prices won't really matter since their competitors face the same thing.
    But even in that unlikely scenario where every competitor has the exact same added cost, I would think it would still lower the demand for that product. If the tax rate was like 99.99% and every business had to raise the price of the widget to 1 million dollars, demand for widgets would have to come down.

    And I don't think it's very likely that all businesses would get hit with the exact same added cost. For one thing some of your competitors might be from overseas. And like you said if you have "friends in washington" you can get a tax break.

    I think the point the others are trying to make is that tax hikes on "just the rich" affect everybody. I agree with that but I don't agree that the "rich" don't pay taxes.

  5. #4
    Quote Originally Posted by Madison320 View Post
    I think the point the others are trying to make is that tax hikes on "just the rich" affect everybody. I agree with that but I don't agree that the "rich" don't pay taxes.
    Again, you really need to distinguish between "the rich" and businesses.

    Of course the rich pay taxes. As a group, the amount of tax revenue from "the rich" exceeds the rest of the population combined. (of course, that's only direct taxation - not counting the inflation tax...)

    But you're talking about businesses. Some businesses are taxed, but smart ones and ones with connections either avoid taxes, or pass the taxation onto their consumers. If they don't, then they cut in other areas like their labor costs, or their capital project costs. Either way, it ends up hurting lower income people. I don't think I've ever seen a business survive very long that has allowed taxes to cut into profits.
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  6. #5
    Quote Originally Posted by Madison320 View Post
    On another thread the topic of how much tax the rich pay came up. According to everyone but me, the rich do not pay any taxes, they simply raise the price of the good they produce to cover for the tax hike.

    Here's an example:

    "The rich do not pay taxes, we pass the cost of taxes over to the consumers. I am retired, and 90% of my income comes from rental income. If tax rates go up, then rents will go up - plain and simple."

    I can understand the business owner would try pass the cost on to the consumer but doesn't this violate the basic laws of supply and demand? If you raise the price of a good, demand for that good will fall and your profits wil be reduced at some point, correct?

    Suppose you sell widgets. Your cost is $1 and you sell the widgets for $2 and the tax rate is 0%. The demand for those widgets is 1 million in a year so you make a profit of a million dollars. Now suppose the tax rate is 50%. So you raise the price of the widget to $3 to cover the tax increase. But here's the catch. At 3$ a widget you can't sell 1 million widgets! So your profit gets reduced. So you ARE paying taxes.
    Quote Originally Posted by CaptUSA View Post
    The thing about taxes is that all of their competitors have the same price increase as they do, so raising their prices won't really matter since their competitors face the same thing. But what happens in the real world is that certain businesses write the laws that allow them to not have to pay those taxes. (special interest tax breaks and deductions) It ends up hurting small businesses which reduces competition for large corporations.

    Ironically, it has the exact opposite effect of what progressives want. Which is why the larger our government gets, the more powerful corporations get.
    There's the answer. A rising tide raises all ships. A tax that truly effects all businesses equally will not effect competition. They will all have to raise prices, if they are already at their lowest price point. Once again, it's about competition (with the above caveat about corporatism).

    Additionally, it's about demand for the product. Is it an elastic demand, or inelastic? If it is a product that people can not go without, raising prices will not effect demand very much. How much housing can you cut back on? How much gasoline or electricity can you cut back on? Once you hit a certain point, you can't cut back any more.
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  7. #6
    Look at the statistical data on the Dept. of the Treasury website. You can find the data here.

    The top 10% earners in this country pay like 3/4 of the income tax burden. The top 50% pay nearly the entire income tax burden. Anyone who says 'the rich don't pay taxes' is completely ignorant.

    As far as business owners passing along tax/regulatory costs... yes, they will do that as much as they can because that is a baked in 'cost of doing business'.

  8. #7
    Quote Originally Posted by VBRonPaulFan View Post
    Look at the statistical data on the Dept. of the Treasury website. You can find the data here.

    The top 10% earners in this country pay like 3/4 of the income tax burden. The top 50% pay nearly the entire income tax burden. Anyone who says 'the rich don't pay taxes' is completely ignorant.

    As far as business owners passing along tax/regulatory costs... yes, they will do that as much as they can because that is a baked in 'cost of doing business'.
    Those statistics are a reflection of income gaps more than anything.

    If there are two people both paying 15% of their income as a tax, one making $30k/year, one making $500million/year, which one pays the bulk of the government revenue? They both pay the same percentage, supposedly causing the same amount of "pain". The difference is the income level. Both have to pay 15 cents on the dollar.
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  9. #8
    Quote Originally Posted by VBRonPaulFan View Post
    Look at the statistical data on the Dept. of the Treasury website. You can find the data here.

    The top 10% earners in this country pay like 3/4 of the income tax burden. The top 50% pay nearly the entire income tax burden. Anyone who says 'the rich don't pay taxes' is completely ignorant.

    As far as business owners passing along tax/regulatory costs... yes, they will do that as much as they can because that is a baked in 'cost of doing business'.
    What percent of income taxes would be "falr"? If a group has 70% of the wealth is paying 45% of the taxes "too much"? How do we determine "fairness"?

    http://freepolitica.org/2011/10/31/w...-about-wealth/



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  11. #9
    Quote Originally Posted by Zippyjuan View Post
    What percent of income taxes would be "falr"? If a group has 70% of the wealth is paying 45% of the taxes "too much"? How do we determine "fairness"?
    You could start by not looking at people as groups.

    Fairness will never be achieved by categorizing someone and then determining their "fair share". Fairness is achieve when each individual is treated the same regardless of what groups one belongs to.
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  12. #10
    Quote Originally Posted by VBRonPaulFan View Post
    Look at the statistical data on the Dept. of the Treasury website. You can find the data here.

    The top 10% earners in this country pay like 3/4 of the income tax burden. The top 50% pay nearly the entire income tax burden. Anyone who says 'the rich don't pay taxes' is completely ignorant.

    As far as business owners passing along tax/regulatory costs... yes, they will do that as much as they can because that is a baked in 'cost of doing business'.
    The rich don't pay taxes in the sense that the costs of taxes are passed onto the consumers. Yes, I write a really big check to the IRS every quarter, but that money is just a cost of doing business like utilities, etc. The only "rich" people that are paying taxes and not offsetting them to consumers are the "working rich" (i.e. people earning over 250K per year through salary only - think a husband and wife that are both actuaries, anesthesiology nurses, or other six figure 40/hr a week job)

    This is something that conservatives need to point out to dispel the class envy argument pushed by the left. The people that are really hurt by "taxing the rich" are the poor and middle class because the costs of goods and services will increase and/or wages will decrease.
    Last edited by CaptLouAlbano; 12-05-2012 at 01:48 PM.

  13. #11
    Quote Originally Posted by Madison320 View Post
    On another thread the topic of how much tax the rich pay came up. According to everyone but me, the rich do not pay any taxes, they simply raise the price of the good they produce to cover for the tax hike.

    Here's an example:

    "The rich do not pay taxes, we pass the cost of taxes over to the consumers. I am retired, and 90% of my income comes from rental income. If tax rates go up, then rents will go up - plain and simple."

    I can understand the business owner would try pass the cost on to the consumer but doesn't this violate the basic laws of supply and demand? If you raise the price of a good, demand for that good will fall and your profits wil be reduced at some point, correct?

    Suppose you sell widgets. Your cost is $1 and you sell the widgets for $2 and the tax rate is 0%. The demand for those widgets is 1 million in a year so you make a profit of a million dollars. Now suppose the tax rate is 50%. So you raise the price of the widget to $3 to cover the tax increase. But here's the catch. At 3$ a widget you can't sell 1 million widgets! So your profit gets reduced. So you ARE paying taxes.
    The fact that it violates the laws of supply and demand is the whole point. The government is messing up the system by raising taxes and meddling in the economy. It is causing the business cycle because supply and demand are not allowed to work properly. If the expenditures of a business go up, you can bet at least some people will pass that on to the consumers rather than take a pay cut. Sure, some people may suffer the cut if they are generous, but it certainly can't be taken for granted in a society where the government is completely fine with distorting the perceived demand of something by indirectly raising its prices. A business can only suffer so much inflation and taxation before it will be forced to raise its prices, so the laws of supply and demand were already being violated a long time ago.

    As for the point about less business as a result of raising prices, a rental business like an apartment building doesn't really suffer from that because when everyone's raising prices, housing is a priority for everyone, and they'll get it one way or another. More people may not be able to afford housing, but there really is no shortage of demand. As long as somebody is paying the rent, we don't lose any business. If we simply can't fill our apartments because nobody can pay rent, that's when things have gotten so bad that it's really time to just sell off the assets and invest elsewhere or move.

    In a retail business, however, you're right. Higher prices means lost business, but like the other poster said, it's a balancing act. If you make a lower profit keeping the prices the same even with the taxes than you would if you raised the prices, then you're going to raise prices, even though you would make even more money if there were no taxes in the first place. But that's not really an option. In many businesses, however, there is more than enough demand for the owner to raise the prices and make the same amount of money even with the taxes. It just depends on what business you're involved in.

    Additionally, even in retail businesses, some of the businesses that allow taxes to cut into their profits will go out of business. This raises the demand for the remaining businesses to counteract the supply which is currently too high to accomodate so many businesses because there is simply not enough money to go around since so much of it is being taken. So, eventually it will work out and be roughly the same for most business owners, it's just that the struggling businesses will fall under the weight and there will be less businesses overall.
    Last edited by PaulConventionWV; 12-05-2012 at 11:31 AM.
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  14. #12
    Quote Originally Posted by Madison320 View Post
    Suppose you sell widgets. Your cost is $1 and you sell the widgets for $2 and the tax rate is 0%. The demand for those widgets is 1 million in a year so you make a profit of a million dollars. Now suppose the tax rate is 50%. So you raise the price of the widget to $3 to cover the tax increase. But here's the catch. At 3$ a widget you can't sell 1 million widgets! So your profit gets reduced. So you ARE paying taxes.
    If that is the case, then I stop selling widgets and I start selling something that I can double my money on, like I did with the widgets. When I was in business full time I was in it for the money - and nothing more. My main business was seasonal Jersey shore businesses (boardwalk games, parking lots, ice cream stands, etc). If one of the entities I owned stopped making the rate of return that I wanted to make, I would shut it down and buy something else.

    The same goes for me today with my real estate rentals. If I cannot raise the rents and make the money I want to make, I will sell the property and buy another one where I can make the rate of return that I expect to make. I would be foolish to hold onto the property with the increased costs and lower profit margin, when I can just as easily acquire another property that makes the margin that I expect.

  15. #13
    Quote Originally Posted by CaptLouAlbano View Post
    If that is the case, then I stop selling widgets and I start selling something that I can double my money on, like I did with the widgets. When I was in business full time I was in it for the money - and nothing more. My main business was seasonal Jersey shore businesses (boardwalk games, parking lots, ice cream stands, etc). If one of the entities I owned stopped making the rate of return that I wanted to make, I would shut it down and buy something else.

    The same goes for me today with my real estate rentals. If I cannot raise the rents and make the money I want to make, I will sell the property and buy another one where I can make the rate of return that I expect to make. I would be foolish to hold onto the property with the increased costs and lower profit margin, when I can just as easily acquire another property that makes the margin that I expect.
    So if we had an income tax rate of 99% that would not affect your profits at all? You would just switch to the appropriate business that makes the return you're looking for? I'm not following that.

  16. #14
    Quote Originally Posted by Madison320 View Post
    So if we had an income tax rate of 99% that would not affect your profits at all? You would just switch to the appropriate business that makes the return you're looking for? I'm not following that.
    Well a 99% tax rate would be absurd, so that is not worth considering. But let's look at the situation we are currently dealing with instead. If the Bush tax cuts expire ad return to Clinton era rates the 33% bracket goes to 36% and the 35% bracket to 39.6% - for me, I am looking at about 15,000 more per year in taxes (rough estimate from my accountant).

    So, I have a choice to make. I can either make 15K less next year, or I can increase my rental prices to make up for the difference. Taxes are a cost, just like utilities and maintenance are costs. When costs go up, I can either eat the costs or raise my prices. I own 24 commercial units, 8 residential units and 6 vacation units that I rent out. If and when my taxes go up, I will sit down with my accountant and go over all the costs associated with my properties (maintenance, utilities, projected improvements, fees, taxes, etc) and I will make adjustments to the rental fees accordingly.

    Now let's say hypothetically that if I raise rents in my apartment building, it prices me above the market, and I can no longer rent those properties out. What do I do? Well I can eat the loss, which would be silly. Or I can sell the building (which in this case I can get close to $1 million for the building) and put that million dollars into another property (or properties) where I can make the expected rate of return on my costs.

    So at the end of the day, if the Bush tax cuts expire and my rates go up, I will still make the same amount of money at the end of the year. It doesn't effect me on bit at all. However, I am fundamentally opposed to this of course since I don't want to see rents go up for my tenants, nor do I wish to see the Federal gov't get more money to spend.

  17. #15
    Quote Originally Posted by CaptLouAlbano View Post
    Well a 99% tax rate would be absurd, so that is not worth considering. But let's look at the situation we are currently dealing with instead. If the Bush tax cuts expire ad return to Clinton era rates the 33% bracket goes to 36% and the 35% bracket to 39.6% - for me, I am looking at about 15,000 more per year in taxes (rough estimate from my accountant).

    So, I have a choice to make. I can either make 15K less next year, or I can increase my rental prices to make up for the difference. Taxes are a cost, just like utilities and maintenance are costs. When costs go up, I can either eat the costs or raise my prices. I own 24 commercial units, 8 residential units and 6 vacation units that I rent out. If and when my taxes go up, I will sit down with my accountant and go over all the costs associated with my properties (maintenance, utilities, projected improvements, fees, taxes, etc) and I will make adjustments to the rental fees accordingly.

    Now let's say hypothetically that if I raise rents in my apartment building, it prices me above the market, and I can no longer rent those properties out. What do I do? Well I can eat the loss, which would be silly. Or I can sell the building (which in this case I can get close to $1 million for the building) and put that million dollars into another property (or properties) where I can make the expected rate of return on my costs.

    So at the end of the day, if the Bush tax cuts expire and my rates go up, I will still make the same amount of money at the end of the year. It doesn't effect me on bit at all. However, I am fundamentally opposed to this of course since I don't want to see rents go up for my tenants, nor do I wish to see the Federal gov't get more money to spend.

    I used 99% to demonstrate the principle. The same thing happens at a lower rate, it's just not as obvious. I'll concede that rental property is a special case because demand is inelastic. But in a lot of cases the business owner pays ALL the taxes. Suppose you manufacture TVs. Now you are in competition with foreign companies. If they have a lower tax rate and everything else is equal they will have an advantage. The consumer will still pay the same low amount but to stay in business the owner will have to reduce his profits. So in that case the tax falls entirely on the business owner.

  18. #16
    Quote Originally Posted by Madison320 View Post
    I used 99% to demonstrate the principle. The same thing happens at a lower rate, it's just not as obvious. I'll concede that rental property is a special case because demand is inelastic. But in a lot of cases the business owner pays ALL the taxes. Suppose you manufacture TVs. Now you are in competition with foreign companies. If they have a lower tax rate and everything else is equal they will have an advantage. The consumer will still pay the same low amount but to stay in business the owner will have to reduce his profits. So in that case the tax falls entirely on the business owner.
    Yes, but the issue is that most smart businessmen will not lower their profits to a point which is foolish.

    When I ran retail businesses I had a pretty simple formula. When you add up all the costs of doing business (rent, labor, insurance, supplies, utilities and taxes) I wanted to triple my investment at minimum. If I had a ice cream stand and I was able to triple my money, it stayed open. But once any of those costs grew to the point where I could no longer make the rate of return I wanted, then I would shut it down and sell water ice instead.

    I think you are making the assumption that if I manufactured TV's that I have no other options but to keep making TV's. That is not the case in business. Businessmen like myself can morph into other businesses at will. We put our money where it will make the highest level of return. If that is making TV's then great, but once it becomes too costly to make TV's we'll make radios instead.
    Last edited by CaptLouAlbano; 12-06-2012 at 10:50 AM.



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  20. #17
    Figures I saw earlier today indicated that it only takes $140,000 a year to qualify as the Top Ten Percent. But the "rich" don't just get income from wages but from investments as well. They are also more able to take advantage of deductions and exemptions than those at lower incomes.

  21. #18
    Quote Originally Posted by Madison320 View Post
    On another thread the topic of how much tax the rich pay came up. According to everyone but me, the rich do not pay any taxes, they simply raise the price of the good they produce to cover for the tax hike.

    Here's an example:

    "The rich do not pay taxes, we pass the cost of taxes over to the consumers. I am retired, and 90% of my income comes from rental income. If tax rates go up, then rents will go up - plain and simple."

    I can understand the business owner would try pass the cost on to the consumer but doesn't this violate the basic laws of supply and demand? If you raise the price of a good, demand for that good will fall and your profits wil be reduced at some point, correct?

    Suppose you sell widgets. Your cost is $1 and you sell the widgets for $2 and the tax rate is 0%. The demand for those widgets is 1 million in a year so you make a profit of a million dollars. Now suppose the tax rate is 50%. So you raise the price of the widget to $3 to cover the tax increase. But here's the catch. At 3$ a widget you can't sell 1 million widgets! So your profit gets reduced. So you ARE paying taxes.
    All of your competitors have to pay the same amount of tax. So unless one of them is willing to cut into his profits, all versions of said widget will cost more. If the widget is something consumer either have to have or want so bad that they don't mind paying extra, they will pay extra and all of the tax will be passed on.

    Here's a practical example. When gas prices go up, for whatever reason, people keep doing the same base level of driving. Sure, some discretionary driving goes away, but in the end people still have to drive to work or take public transportation which also has to use some kind of fuel or energy. If the federal gasoline tax was raise you can bet your bottom dollar that would be passed on to the consumers.
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  22. #19
    You are correct. Higher taxes means higher gross prices, which means less profit for the seller (even with a "fair tax" for all transactions) and fewer goods for the buyer.

    Whether the consumer or the producer has to transfer the actual tax to the government doesn't matter at all.

    http://en.wikipedia.org/wiki/Tax_incidence

  23. #20
    Quote Originally Posted by Danan View Post
    You are correct. Higher taxes means higher gross prices, which means less profit for the seller (even with a "fair tax" for all transactions) and fewer goods for the buyer.

    Whether the consumer or the producer has to transfer the actual tax to the government doesn't matter at all.

    http://en.wikipedia.org/wiki/Tax_incidence
    Thanks for that link.

    I agree it that a higher tax rate on the "rich" sucks for everybody. But I'm not sure I agree that whoever pays the tax doesn't matter AT ALL. Suppose you had a 30% tax on people with incomes over 1 million but 0% for everyone else and the net tax revenue was 100 billion. Now also suppose you have a flat 1% tax that also collected 100 billion in tax revenue. According to your statement would these 2 situations be identical in terms of fairness? I still think raising taxes on the "rich" hurts the "rich" more in general.

  24. #21
    The only true player who 'passes taxes on' are the governments who force them on others. Everyone else pays them. 'Business X, Y and Z just pass on the taxes' is not true, the companies pay out of lost profits. Governments are notorious at claiming the bushiness will just pass them on...businesses and consumers get screwed by the same band of crooks.

    If everyone just passes the taxes on, then why don't businesses just price their goods with taxes included just like any other cost in making thier product?

    Come on and default already. I love it when bureaucrats and politicians look like the frauds that they are.

  25. #22
    I want to tax the unjustly rich by taking away their mechanism for transferring their "riches" to themselves. Every other discussion about taxing the rich is the search for a plausible means to steal.

    The discussion should be about being tax free just like the rich.

    Its like a man stumbling upon a colony of lepers. The lepers seeing that he is not afflicted with their malady, in their hatred and envy, demand that this man be arrested and infected; "its only fair!" they scream. "Why should this man walk around completely healthy!".

  26. #23
    Quote Originally Posted by awake View Post
    I want to tax the unjustly rich by taking away their mechanism for transferring their "riches" to themselves. Every other discussion about taxing the rich is the search for a plausible means to steal.
    That's still class envy. The better idea is to have a flat tax and a cap on spending. Then as we address the problem of spending, and reduce the size of government we can reduce the flat tax rate.

    The rich will always be rich, not matter what kind of system is in place. There is a reason for that. Those who are rich are, in large part, innovative and inventive. We desire to make money and we find ways that we are able to do so. I started with very little and built for myself a multi million dollar business that lasted until the day I decided to retire and sell off everything that I owned. In good times and in bad times, high taxes and low taxes, I always succeeded and always had expensive cars, 5 star vacations and plenty of money to burn. The reason was because I knew what it took to make money and I did it.

  27. #24
    Quote Originally Posted by CaptLouAlbano View Post
    That's still class envy. The better idea is to have a flat tax and a cap on spending. Then as we address the problem of spending, and reduce the size of government we can reduce the flat tax rate.

    The rich will always be rich, not matter what kind of system is in place. There is a reason for that. Those who are rich are, in large part, innovative and inventive. We desire to make money and we find ways that we are able to do so. I started with very little and built for myself a multi million dollar business that lasted until the day I decided to retire and sell off everything that I owned. In good times and in bad times, high taxes and low taxes, I always succeeded and always had expensive cars, 5 star vacations and plenty of money to burn. The reason was because I knew what it took to make money and I did it.

    I don't envy the parasitical class...

    I'm all for staged removal of taxation, but you're dealing with infantile minds(politicians). They will never follow through on any promise to lower or truly reform taxes. They will say they will do it in 10 or 20 years which is really thier way of saying never. This is why I'm thinking a complete worldwide financial meltdown might actually be a good thing. The curtain will fall for all to see the grand wizards.



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  29. #25
    Quote Originally Posted by awake View Post
    I don't envy the parasitical class...

    I'm all for staged removal of taxation, but you're dealing with infantile minds(politicians). They will never follow through on any promise to lower or truly reform taxes. They will say they will do it in 10 or 20 years which is really thier way of saying never. This is why I'm thinking a complete worldwide financial meltdown might actually be a good thing. The curtain will fall for all to see the grand wizards.
    But who will suffer with a meltdown? The poor and middle class will. We are in the worst economy since the Depression right? We were at the four seasons in Maui last winter - suites there are over 2 grand a night, they were filled. We ate at high end restaurants where a table of 2 spends at least $300 not including wine - they were packed. All this with 8% unemployment and millions of working folks being "under employed".

    My concern, or better stated fear, is that if we do have a meltdown it won't be the conservatives and libertarians who the people will turn to for solutions - it will be the socialists who will provide the freebies when people are starving. This happened in the depression and it is happening today in countries like Greece. Look who came to power in Greece after their collapse - the Nazis and Commies.
    Last edited by CaptLouAlbano; 12-05-2012 at 06:44 PM.

  30. #26
    Quote Originally Posted by CaptLouAlbano View Post
    But who will suffer with a meltdown? The poor and middle class will. We are in the worst economy since the Depression right? We were at the four seasons in Maui last winter - suites there are over 2 grand a night, they were filled. We ate at high end restaurants where a table of 2 spends at least $300 not including wine - they were packed. All this with 8% unemployment and millions of working folks being "under employed".

    My concern, or better stated fear, is that if we do have a meltdown it won't be the conservatives and libertarians who the people will turn to for solutions - it will be the socialists who will provide the freebies when people are starving. This happened in the depression and it is happening today in countries like Greece. Look who came to power in Greece after their collapse - the Nazis and Commies.

    Who suffered when Bernie Madoff went under? That was a financial meltdown on a smaller scale. The people caught in his crime were told the truth the hard way. The crooks should get their day in the sunlight. And the foolish should rightfully get the lesson of the ages: don't believe that criminals can protect you.

    People should stop apologizing for the state, let them get whats coming to them.



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