patrick.net

Ah, the fiscal cliff compromise hasn't even happened yet; instead it was pushed back a few months. Neither has any serious discussion of tax loopholes or government spending. All that has yet to be decided on. What was recently resolved was the fate of the Bush tax cuts and a few other expiring tax breaks. Don't write history until it happens. Remember President Dewey?

But it is a strategy many regular people can use. It is not only for rich people. It is not only for hedge funds. It is useful to businesses with intellectual properties and/or royalties.

Small guys starting a software company may benefit too.

I don't know why it is being painted as something evil.

Romney also benefited from free air, should we have an air tax too?

And if people choose to stick with wage slavery they should not complain about their lack of tax efficiency.

I agree that healthcare needs to be fixed so that people can feel free to leave their corporate slave masters. Let's work on universal healthcare instead.

robertoaribas says

Peter P says

But it is a strategy many regular people can use. It is not only for rich people. It is not only for hedge funds. It is useful to businesses with intellectual properties and/or royalties.

Small guys starting a software company may benefit too.

I don't know why it is being painted as something evil.

Romney also benefited from free air, should we have an air tax too?

only a GIANT c**s**er could even write this.... income is income, and making much more shouldn't put you into a special lower tax rate.

carried interest is income, and should be taxed as such.

If income is income then everyone should pay the same rate for everything.

I am all for a flat tax.

robertoaribas says

making much more shouldn't put you into a special lower tax rate

It is also not about more, but how.

A person working for Bain doing the same thing that someone working for Fidelity gets to pay half the taxes. It's the same as if a cook at Outback was paying half the taxes on the same income as a cook in Cheesecake Factory.

I am not for a flat tax but for a fair tax. Pure flat tax hurts the middle class, so we still need a progressive tax system. We do need to get rid of loopholes that are as crazy as this one.

treatmentreport says

Pure flat tax hurts the middle class, so we still need a progressive tax system. We do need to get rid of loopholes that are as crazy as this one.

1) Progressive tax hurts the middle class
2) Loopholes are there so that progressive tax hurts only the middle class

A better tax will be one levied on the ownership of real properties.

Peter P, you should go back to your deep and profound philosophical comments. When you start trying to sound pragmatic, you get even more ridiculous.

Peter P says

1) Progressive tax hurts the middle class

You're right in a relative way, about loopholes, but then the answer is to make taxes truly progressive by reducing loopholes and deductions for the rich.

We've all learned about Georgism and how problematic rents are from B BIll, Patrick and others. But we also know that it is a minority that understand this and that it won't be addressed soon.

Whereas, more progressive taxation would be going back to something we have already done before that we know works.

(I'm not suggesting it should be as progressive as it was in the 60s and 70s)

marcus says

You're right in a relative way, about loopholes, but then the answer is to make taxes truly progressive by reducing loopholes and deductions for the rich.

That is as likely to happen as the Land Value Tax.

The fashionable concept is obscurity by complexity.

Tax is "allowed" to be progressive only because there are loop holes.

I was just saying the treatment of carried interests is no worse than mortgage interest deduction or child tax credit.

Popularity does not make things right. But then again is there too much moral framing in economics?

One thing to remember, income taxes of any form hurts only those who are trying to be rich.

John D said, own nothing, control everything.

Remember, even supposedly super-fair societies like Japan have huge underground economies controlled by "interesting" characters.

marcus says

Whereas, more progressive taxation would be going back to something we have already done before that we know works.

I think that's the most important point here. We have plenty of historical evidence that supports progressive taxation if you want a more balanced society. Not so much for flat tax: http://en.wikipedia.org/wiki/Flat_tax#Countries_that_have_flat_tax_systems

The ideal society is not one of equality. Utopia is overrated.

We should find the answer in Nietzsche's work. We cannot achieve a higher form of human civilization by policy or wealth redistribution.

The important thing is that people must be treated as individuals with their own wants. A society with good wants will be a desirable one.

All those so-called "fair" first-world societies will fail. They will too much too much collective idealism and not enough individual will.

treatmentreport says

We have plenty of historical evidence that supports progressive taxation if you want a more balanced society.

Are you referring to a mere 100 years of "history?"

Are you instead ignoring what humanity is?

Progressive taxation is an artifact of populistic systems, which worked out over the last 100-200 years.

We all know how it ends. People will vote for ever more benefits and they will stick the bill to minorities. It will work until it stops. Europe is getting a taste of that right now.

First and foremost, we must recognize that evil is part of human nature. It is useless to whitewash this fact. It is futile to create "systems" to hide reality.