Where will inflation stop?

Boost_Crazy said:

In reply to frenchyd :

For the most part, I'm really on board with a flat tax or value added tax with no other taxes. But that it very unlikely to happen, as taxes are more than just a revenue source for the government. They are a means of control of behaviors. If they want less of something, they tax it more, if they want more, they tax it less. They lose those levers with a flat tax. The other issue is that it would turn our progressive tax structure into a regressive structure. Since the poor generally spend all of their money, they would be taxed on everything with no exemptions. Currently they pay little to no federal tax, often getting "refunds" of more than they have paid. I'm not okay with raising taxes on the poor, so I'd guess a lot of people would really not be okay with that. I'm also uncomfortable with taxing stocks- if you are talking a one time tax to the purchaser at the purchased value, that's interesting, and possibly much more workable than taxing the owner for unrealized gains as some have recommended. I'd need to think about that one.

If you think the current  system is progressive  you haven't read all 77,000 pages of the tax code. ( could be longer by now  that number is about 15 years old. )  

Nor  have you hired lawyers to find those Legal Precedents  at $1000+ hr.  
     You can buy Ford Motor company or anybody without paying 1 cent in taxes. Well you can't. You're not a trillionaire   
  The truth is all those tax breaks mean we pay more of our income than the Uber rich do. 
   Eliminate income tax.  Completely.   Make the Congress justify any sin tax. ( which by the way are mostly a sales tax) 

So many interesting topics.

Manufacturing on foreign soil-

I have done analysis of several products to be made in the Americas, Asia, or eastern Europe. The costs differences are actually surprisingly small. What drove mose decisions was which location offered the potential of sales growth, as in Chinese manufacturing of homes driving increased heavy grinder sales. So build the production line there to reduce shipping costs. We even brought two product line back to the USA due to, again, sales and Nafta benefits. 

VaT-

Is a tool as some have said. It is a great tool and would require a change in the concept of internal revenue generation.  We already kind of have a VAT for limited items. I support expanding it and restructuring it as well as income taxation. I think it seems scary to many as it almost makes it too easy to feel taxed compared to other revenue generation methods. 

Fed budget-

I always felt my government should have more funding AND more efficient systems AND less defense spending. But all three of those and varied in intensity of priority. Most federal funding is too small for what the public asks the government to do. Few people elect representatives based on plans to match funding to public wants. They elect based on rhetoric of cut cut cut, tax=bad. I even had a cop tell me he felt the his city was paying too much for the fire department. While I am in his brand new police department connected to the brand new fire station filing a theft report. 

Redistribution of wealth-

As I recall in my high school classes. The USA government structure was formatted to move slowly to allow the public to change course through voting to prevent the kingdom like edicts of instant law changes, to ensure we don't get to many wealthy families that are so wealthy that they can over power government, as old europe kings were essentially just those guys rich enough to buy enough swords and own enough food production to make people do what they wanted. So I guess I felt the goal of how the USA and it’s revenue and taxation system were structured was to make sure wealth is taken off the top earners otherwise the country just returns to kingdom like rule. I think there should be an income tax and VAT system structured to do just that.

Slave labor-

Just a couple generations from legal slavery in the USA (depending on when Jim crow laws are considered to have been negated) has not been enough time for the USA to stabilize with regard to lower income work vs middle income work. Having worked in China and Mexico, the local employees I worked and hung out with there see those several hundred years of slave labor as causing the USA to have a huge inflated ego and distortion of economic norms. In some countries I worked in, the locals would laugh as they explained to me how crazy it seems to them that the USA restaurant (not fast food) workers don't get paid enough to live a sustainable single life without tips. The pandemic has been an interesting social shakeup. I am curious if work life balance for the lowest income jobs will change in any meaningful way. 

In reply to frenchyd :

If you think the current  system is progressive  you haven't read all 77,000 pages of the tax code. ( could be longer by now  that number is about 15 years old. )  

Nor  have you hired lawyers to find those Legal Precedents  at $1000+ hr.  
     You can buy Ford Motor company or anybody without paying 1 cent in taxes. Well you can't. You're not a trillionaire   
  The truth is all those tax breaks mean we pay more of our income than the Uber rich do. 
   Eliminate income tax.  Completely.   Make the Congress justify any sin tax. ( which by the way are mostly a sales tax) 

It doesn't matter what I think, it's the definition of progressive. We have tax brackets, the more you make, the higher percentage you pay...

There are seven federal tax brackets for the 2021 tax year: 10%, 12%, 22%, 24%, 32%, 35% and 37%. Your bracket depends on your taxable income and filing status. These are the rates for taxes due in April 2022.

Add to that the fact that deductions in the lowest income brackets can be more than the amount owed, the effective tax rate for some in negative- they get more money back at refund time than they paid during the year. Those in the top brackets are taxed at more than three times the lower rates. The complexity of the tax code is not for the benefit of businesses. It's for the benefit of the government to exercise control. You may see a business "taking advantage of a loophole." That is horribly misleading terminology, intentionally phrased to elicit a response. Obviously it works. But you could likely read all 77,000 pages of the tax code and never find the word "loophole." "Following the tax code" doesn't sound so interesting. Often when businesses are pointed out for "taking advantage of a loophole," is not freely shared that the "loophole" came before the business. The tax code was written specifically to drive the behavior that generated the "loophole." 
 

Now that I mention that, it does seem like an obstacle towards a flat tax, which could stifle business growth. Fixable, but going to require more code than a basic flat tax. Anyways flat taxes are regressive by nature, with doesn't seem to be what you really want Frenchyd. The poor would pay a much higher percentage of the overall tax base than they do now. 

The often repeated notion that the rich pay less taxes than regular people is a farce. It is intentionally misleading and designed to be accepted and shared by people who don't understand the differences in the terminology. "Bill Gates pays less income tax than his secretary." "Elon Musk pays no income tax!" Well, yea- neither of them punch a clock and pick up a check from payroll every other Friday, so they have no income. They pay the same as anyone else without a job. 100% of nothing. If Gates got off his lazy ass and got a 9-5 like the rest of us, he would pay income tax. Musk paid 11 Billion on the stock he cashed out. "But Tesla didn't pay taxes either!" Tesla lost money for over a decade before getting into the black. The tax code allows business to write off previous losses once they become profitable. Which makes complete sense when you think about it, because who would start a business if it was going to be decades before any chance of a payback? Amazon is in the same boat. It's not hard to find articles calling them tax dodgers. No mention of the tax code or that Amazon will be paying billions now that they are in the black. Billions that wouldn't exist had then not been able to write off their losses on the road to profits. To me, that is journalistic malpractice. 
 

If anyone gets anything out of my posts, whether you agree or disagree, I hope it's that we all need to be more skeptical when we take in new information. Statistics, graphs, reports, opinions- there is a whole science on how present them in a way to influence an opinion. Be even more critical of info that supports your opinion, this is common on all sides of every topic.

In reply to Boost_Crazy :

Fantastic posts. Thank you.

Boost_Crazy said:

In reply to frenchyd :

If you think the current  system is progressive  you haven't read all 77,000 pages of the tax code. ( could be longer by now  that number is about 15 years old. )  

Nor  have you hired lawyers to find those Legal Precedents  at $1000+ hr.  
     You can buy Ford Motor company or anybody without paying 1 cent in taxes. Well you can't. You're not a trillionaire   
  The truth is all those tax breaks mean we pay more of our income than the Uber rich do. 
   Eliminate income tax.  Completely.   Make the Congress justify any sin tax. ( which by the way are mostly a sales tax) 

It doesn't matter what I think, it's the definition of progressive. We have tax brackets, the more you make, the higher percentage you pay...

There are seven federal tax brackets for the 2021 tax year: 10%, 12%, 22%, 24%, 32%, 35% and 37%. Your bracket depends on your taxable income and filing status. These are the rates for taxes due in April 2022.

Add to that the fact that deductions in the lowest income brackets can be more than the amount owed, the effective tax rate for some in negative- they get more money back at refund time than they paid during the year. Those in the top brackets are taxed at more than three times the lower rates. The complexity of the tax code is not for the benefit of businesses. It's for the benefit of the government to exercise control. You may see a business "taking advantage of a loophole." That is horribly misleading terminology, intentionally phrased to elicit a response. Obviously it works. But you could likely read all 77,000 pages of the tax code and never find the word "loophole." "Following the tax code" doesn't sound so interesting. Often when businesses are pointed out for "taking advantage of a loophole," is not freely shared that the "loophole" came before the business. The tax code was written specifically to drive the behavior that generated the "loophole." 
 

Now that I mention that, it does seem like an obstacle towards a flat tax, which could stifle business growth. Fixable, but going to require more code than a basic flat tax. Anyways flat taxes are regressive by nature, with doesn't seem to be what you really want Frenchyd. The poor would pay a much higher percentage of the overall tax base than they do now. 

The often repeated notion that the rich pay less taxes than regular people is a farce. It is intentionally misleading and designed to be accepted and shared by people who don't understand the differences in the terminology. "Bill Gates pays less income tax than his secretary." "Elon Musk pays no income tax!" Well, yea- neither of them punch a clock and pick up a check from payroll every other Friday, so they have no income. They pay the same as anyone else without a job. 100% of nothing. If Gates got off his lazy ass and got a 9-5 like the rest of us, he would pay income tax. Musk paid 11 Billion on the stock he cashed out. "But Tesla didn't pay taxes either!" Tesla lost money for over a decade before getting into the black. The tax code allows business to write off previous losses once they become profitable. Which makes complete sense when you think about it, because who would start a business if it was going to be decades before any chance of a payback? Amazon is in the same boat. It's not hard to find articles calling them tax dodgers. No mention of the tax code or that Amazon will be paying billions now that they are in the black. Billions that wouldn't exist had then not been able to write off their losses on the road to profits. To me, that is journalistic malpractice. 
 

If anyone gets anything out of my posts, whether you agree or disagree, I hope it's that we all need to be more skeptical when we take in new information. Statistics, graphs, reports, opinions- there is a whole science on how present them in a way to influence an opinion. Be even more critical of info that supports your opinion, this is common on all sides of every topic.

 

 

 

Let's avoid purjorative words and accept the idea that it costs money to run the country. 
     The system we have now is unduly complex. Understood by no one ( really)  

First,  let's deal with the poor. Those without the means to take care of themselves.   My sister is one of those. She has a disease that keeps her bed ridden.   Her fingers are so distorted  that a two sentence text is a painful ordeal. Getting from the bed to the bathroom is a daunting task.  Medicare provides an income.  I supplement it when needed.  
     People like her need help and if asked they would gladly rather do work than accept welfare.  That is a valid duty of Government. Those who meet those standards get a government paycheck ( more likely a direct  deposit  in their  account )  

The  Working poor. Is also simple. Minimum wage.  It needs to be enough to provide basic, food, clothing, and shelter in exchange for a standard work week of one person.    Its do able without issue. 
 
   Finally, pretty much the system we have now. The taxes could be taken out from the paycheck or taxes can be paid when things are purchased. The later is voluntary and won't require filling out forms.  Also it's at each persons discretion.    If someone wants to save to buy something special. That person can.  
      You tend to feel good when you get something you want and so taxes won't be a burden. 
        
     Call it flat taxes because it is. A flat 2% of whatever is purchased.  Call it progressive because it is, the rich will pay more because they buy more. 
   

In reply to frenchyd :

Let's avoid purjorative words and accept the idea that it costs money to run the country. 
     The system we have now is unduly complex. Understood by no one ( really)  

While I agree that the system is unduly complex, I think you underestimate the understanding by business and the government. The government understands the behaviors that it wants to influence and business understands the carrot and stick consequences of those behaviors. I agree that it could be simpler. 

First,  let's deal with the poor. Those without the means to take care of themselves.   My sister is one of those. She has a disease that keeps her bed ridden.   Her fingers are so distorted  that a two sentence text is a painful ordeal. Getting from the bed to the bathroom is a daunting task.  Medicare provides an income.  I supplement it when needed.  
     People like her need help and if asked they would gladly rather do work than accept welfare.  That is a valid duty of Government. Those who meet those standards get a government paycheck ( more likely a direct  deposit  in their  account )  

I believe society should help those who can't help themselves. I have zero problems with using tax dollars to help the physically and mentally disabled. But it needs to be done wisely- done improperly, it's a disservice to both the tax payer and the ones needing assistance. I read recently that a city local to me had 0ver 90 different overlapping assistance programs. If anything needs streamlining and simplification, it's assistance programs to those in need. Instead, they often just create another program. 

The  Working poor. Is also simple. Minimum wage.  It needs to be enough to provide basic, food, clothing, and shelter in exchange for a standard work week of one person.    Its do able without issue. 
 
 

I'd argue we already have that. Minimum wage can easily provide basic food, clothing, and shelter. But no one wants basic, and we can't agree on what a living wage means. I'm not going to rehash all of my arguments, you can scroll through the thread. 
 

   Finally, pretty much the system we have now. The taxes could be taken out from the paycheck or taxes can be paid when things are purchased. The later is voluntary and won't require filling out forms.  Also it's at each persons discretion.    If someone wants to save to buy something special. That person can.  
      You tend to feel good when you get something you want and so taxes won't be a burden. 
        
     Call it flat taxes because it is. A flat 2% of whatever is purchased.  Call it progressive because it is, the rich will pay more because they buy more. 

You can't call it progressive, because it's not...

A progressive tax is based on the taxpayer's ability to pay. It imposes a lower tax rate on low-income earners than on those with a higher income. This is usually achieved by creating tax brackets that group taxpayers by income ranges.

Since a flat tax is the same rate for all tax payers it is not progressive. Yes, the rich will pay more because they spend more, but at the same rate. While I'm personally in favor of a flat tax on the individual tax side, I don't think it's workable for business, at least not in a simple form. I actually think it's kind of funny. Not picking on you Frenchyd, there are a lot of people- the majority I'd guess- that believe that business and the wealthy is under taxes and the average person is overtaxed. They believe it's unfair, and a flat tax would balance everything out and make it fair again. They are correct for the wrong reason. Despite all of the tax breaks we hear about, the wealthy (business don't really pay taxes, their customers do) pay the vast preponderance of taxes. If we made it "fair," taxes on the lower income would jump. Be careful what you wish for. 

I just thought of another obstacle for the flat tax. Retirement. Most retirement savings are pre tax, since the government wisely wants to incentivize retirement savings. But if we move to a flat tax, we would effectively be taxing people's retirement. Again, fixable, but getting more complicated. 

Boost_Crazy said:

In reply to frenchyd :

Let's avoid purjorative words and accept the idea that it costs money to run the country. 
     The system we have now is unduly complex. Understood by no one ( really)  

While I agree that the system is unduly complex, I think you underestimate the understanding by business and the government. The government understands the behaviors that it wants to influence and business understands the carrot and stick consequences of those behaviors. I agree that it could be simpler. 

First,  let's deal with the poor. Those without the means to take care of themselves.   My sister is one of those. She has a disease that keeps her bed ridden.   Her fingers are so distorted  that a two sentence text is a painful ordeal. Getting from the bed to the bathroom is a daunting task.  Medicare provides an income.  I supplement it when needed.  
     People like her need help and if asked they would gladly rather do work than accept welfare.  That is a valid duty of Government. Those who meet those standards get a government paycheck ( more likely a direct  deposit  in their  account )  

I believe society should help those who can't help themselves. I have zero problems with using tax dollars to help the physically and mentally disabled. But it needs to be done wisely- done improperly, it's a disservice to both the tax payer and the ones needing assistance. I read recently that a city local to me had 0ver 90 different overlapping assistance programs. If anything needs streamlining and simplification, it's assistance programs to those in need. Instead, they often just create another program. 

The  Working poor. Is also simple. Minimum wage.  It needs to be enough to provide basic, food, clothing, and shelter in exchange for a standard work week of one person.    Its do able without issue. 
 
 

I'd argue we already have that. Minimum wage can easily provide basic food, clothing, and shelter. But no one wants basic, and we can't agree on what a living wage means. I'm not going to rehash all of my arguments, you can scroll through the thread. 
 

   Finally, pretty much the system we have now. The taxes could be taken out from the paycheck or taxes can be paid when things are purchased. The later is voluntary and won't require filling out forms.  Also it's at each persons discretion.    If someone wants to save to buy something special. That person can.  
      You tend to feel good when you get something you want and so taxes won't be a burden. 
        
     Call it flat taxes because it is. A flat 2% of whatever is purchased.  Call it progressive because it is, the rich will pay more because they buy more. 

You can't call it progressive, because it's not...

A progressive tax is based on the taxpayer's ability to pay. It imposes a lower tax rate on low-income earners than on those with a higher income. This is usually achieved by creating tax brackets that group taxpayers by income ranges.

Since a flat tax is the same rate for all tax payers it is not progressive. Yes, the rich will pay more because they spend more, but at the same rate. While I'm personally in favor of a flat tax on the individual tax side, I don't think it's workable for business, at least not in a simple form. I actually think it's kind of funny. Not picking on you Frenchyd, there are a lot of people- the majority I'd guess- that believe that business and the wealthy is under taxes and the average person is overtaxed. They believe it's unfair, and a flat tax would balance everything out and make it fair again. They are correct for the wrong reason. Despite all of the tax breaks we hear about, the wealthy (business don't really pay taxes, their customers do) pay the vast preponderance of taxes. If we made it "fair," taxes on the lower income would jump. Be careful what you wish for. 

No I believe elimination of income tax completely in exchange for  a 2% national sales tax would meet America's tax obligation and be acceptable to everyone.  
  It would also benefit the stock market.  Here's how.  There is a fee paid when stock is purchased. It's just a cost of business and meets no objection.  
if at the same time a  sales tax was added while elimination of income tax occurred  there shouldn't be any legitimate  objection.   
   Here's how it would benefit the stock market. As you know the closer to the stock market  the faster the order goes in etc. so much so that there is time to sell or buy in advance of the order actually placed. Ensuring the agency executing  the order can profit from your purchase. Micro seconds are involved in buying and selling that makes the deal not exactly as good as it can be. If a tax is paid with each purchase that no longer remains profitable for the agency executing  the order. This fairness returns to the market.  
     I know how much I pay in taxes.  I doubt  I'm getting a deal. I know I don't have the exemptions available to me that major businesses do. But I don't pay for the lawyers ( which are deductible) 

     If you think there aren't some very questionable deductions business take and some people as well.  If you think the country honestly needs all those laws on taxes. OK. That is your right. 
I'm not saying business is bad, people are good. Look at the cash society.  How many things trade ownership without a tax collection?  
   I simply believe when taxes are made overly complicated not all taxes are properly collected. 
  RE; retirement. Social security and Medicare will be withheld from everyone. ( no more upper limit).  That should help balance the books. 
    As far as saving for retirement since no taxes would be taken out of your paycheck the only time you'd be taxed is when you spend it. ( in retirement) 
  

I feel there's two definitions of "Progressive" being bandied about here- One poster is talking progressive as in, you pay more taxes the more money you make, and the other is progressive, as in a more socialist method.At least thats what I get.

And, a flat tax is horrible for poor people.

In reply to Streetwiseguy :

Ah, that would explain it. I didn't think Frenchyd would be okay with shifting more of the tax percentage from the rich too the poor. I did include the definition in my last post. I'm all for simplifying the tax code, but I can see the pros and cons of the current situation. 

Streetwiseguy said:

I feel there's two definitions of "Progressive" being bandied about here- One poster is talking progressive as in, you pay more taxes the more money you make, and the other is progressive, as in a more socialist method.At least thats what I get.

And, a flat tax is horrible for poor people.

If you think we have a progressive tax system now you clearly haven't studied the 77,000 + pages or hired a tax attorney. 
     The "poor" who don't pay taxes still are heavily taxed. It's just hidden in excise tax, rent or  all the other way the poor are "taxed".  
 
 I understand what a progressive tax is supposed to be.   In the post WW2 era there was a progressive tax. But there were still plenty of exemptions to be had as well.  
     Today those exemptions are many multiples of the post war era.  In fact many prominent people and companies take full advantage of those and pay even less tax then the poor do. 
     
 But this whole discussion has nothing to do with who pays what. It has everything to do with a tax system that cannot be manipulated and is perceived as fair. 
 As far a purjoritive terms like Socialism.  Unfortunately that term has been denigrated to be totally taken in a negative sense rather than the actual intended meaning.  
     If your feeling is that the system is good. Doesn't need improvement, I'll tespect that.  
 If you feel the system is flawed what are your suggestions to improve it?  

In reply to Boost_Crazy :

That is why I'm enjoying this discussion. I too can see flaws with my proposal.  
 But I'm wondering just like our founding fathers did what is a better way.  
  They knew the government they created  would need to change and react to the future. Hence the Bill of rights. 
     I'm trying to change the government.  Not the fundamental concepts they created but a different way to collect the money required to  pay for that government.  
IT STARTED WITH WE THE PEOPLE.  A whole new concept at the time to deal with entrenched Royalty. 
  Change the tax code and it's a whole new way that inherited wealth  won't make the same mistakes that Royalty of the past  labored with.  
Meritocracy is what guided our forefathers. While it wasn't  perfect, it was darn good. A lot better than what preceded it. 

In reply to frenchyd :

Frenchyd, there are many aspects of a flat tax that I find appealing, but your proposal will not do what you think it will do. First, 2% is way, way under the average income tax rate. It would mean dramatic cuts and shrinkage of the federal government to a fraction of it's current size. That's too much for even most small federal government advocates. For comparison's sake, the the average net income tax rate is around 13%. So giving you the benefit of the doubt that 2% was just an example and you want to keep the government the same  size, you need need everyone to pay a flat tax of 13%. But here is an example of current net tax rates (2019 numbers)...

All taxpayers 13.29%

Top 1% 25.57%

Top 5% 21.98%

Top 10% 19.89%

Top 25% 16.73%

Top 50% 14.55%

Bottom 50% 3.54%

So your proposal just about quadruples the federal taxes for the bottom 50% of earners, and cuts the taxes of the top 1% in half. Moreover, your proposal is on money spent, not income. High income earners don't spend all of their money. Lower income earners not only spend all of their money, but often borrow to make purchases. So they will be taxed on more than they even make! 

In reply to frenchyd :

In reply to Boost_Crazy :

That is why I'm enjoying this discussion. I too can see flaws with my proposal.  
 But I'm wondering just like our founding fathers did what is a better way.  
  They knew the government they created  would need to change and react to the future. Hence the Bill of rights. 
     I'm trying to change the government.  Not the fundamental concepts they created but a different way to collect the money required to  pay for that government.  
IT STARTED WITH WE THE PEOPLE.  A whole new concept at the time to deal with entrenched Royalty. 
  Change the tax code and it's a whole new way that inherited wealth  won't make the same mistakes that Royalty of the past  labored with.  
Meritocracy is what guided our forefathers. While it wasn't  perfect, it was darn good. A lot better than what preceded it. 
 

I'm enjoying this discussion too. It made me think and really look into what a flat tax would look like. Before this discussion, I agreed with much of what you said about the complexity of the tax code and the benefits of a flat tax. Admittedly though, I was aware that a flat tax would raise taxes on lower income earners, thinking elevating more people to taxpayer status would get them more involved in how their taxes are spent and more resistance to tax increases. But that's another matter. The point is, while looking at it I realized that a flat tax is not so simple, and at least some of our current complex system exists for a purpose. Not that it can't be simplified, or that I agree that it's a good idea to give the government so many levers to drive behavior. But I don't think that no levers is the correct answer either. I think I've learned that I still have a lot to learn. 
 

The founding fathers would find today's situation- interesting. Income tax wasn't a thing until well after they were gone. The role and size of the current federal government is quite different that what they envisioned. The amount that we have taxed ourselves would leave them scratching their heads. 

In reply to Boost_Crazy :

Well don't forget George Washington had to "put down" the Whiskey rebellion.   And Lincoln came up with the income tax idea. So taxes really are part of our culture.  
        Regarding flat tax idea.  Let's assume you make $20,000 a year  save 1/2 of it for a down payment on a house.  That's $200 in taxes.  If $20,000 isn't enough  to provide food clothing and shelter  his income needs to be raised.  Instead often that person is subsidized by welfare. 

However right now the owner he works for can buy a corporate jet, an apartment in New York and tickets to the opera and deduct all of them as business expenses.  
        If you doubt me go to any major city go out to the FBO at the airport and check the first dozen jets you find. Ask me how I know.  
      My sister worked for a HMO and her whole job was to design and decorate the offices for all the Vice Presidents they hired. Ask why they needed so many Vice Presidents.  
     
 

In reply to frenchyd :

Well don't forget George Washington had to "put down" the Whiskey rebellion.   And Lincoln came up with the income tax idea. So taxes really are part of our culture.  

By that standard, refusing to pay taxes and attacking the tax collectors is also part of our culture. Lincoln wasn't even born until decades after our country's founding. He did institute an income tax, as a temporary measure after a civil war.

        Regarding flat tax idea.  Let's assume you make $20,000 a year  save 1/2 of it for a down payment on a house.  That's $200 in taxes.  If $20,000 isn't enough  to provide food clothing and shelter  his income needs to be raised.  Instead often that person is subsidized by welfare. 

However right now the owner he works for can buy a corporate jet, an apartment in New York and tickets to the opera and deduct all of them as business expenses.  
        If you doubt me go to any major city go out to the FBO at the airport and check the first dozen jets you find. Ask me how I know.  
      My sister worked for a HMO and her whole job was to design and decorate the offices for all the Vice Presidents they hired. Ask why they needed so many Vice Presidents.  

So why doesn't the guy who wants to buy a house learn a skill, get a better job, or work more hours? How about he starts his own business, buys his own corporate jet and apartment in New York, opera tickets, AND a bag of popcorn at the opera, and deduct them all? You are so focused on deductions and loopholes and tax dodges that you can't see anything else. Look a couple posts up to see who pays the taxes. The $20,000 guy pays zero. The business owner bought the jet with his own money. Yes, through the tax code, he was granted the privilege of keeping a bit more of his own money. He didn't get a free jet. He got a credit towards his taxable income. Just like if I buy solar for my house. Because the government wants me to buy solar, and it wants businesses to grow. Or it wants more corporate jets sold. Or both. In the end, he paid way more taxes, both in percentage and dollars, than his employee. Who has a job. That corporate jet guy pays payroll taxes to employ.

FYI, when the company I worked for was privately owned, our owner had a couple corporate jets. We could reserve them to take clients on trips to our headquarters. It was expensive, but worth every penny. They tracked sales from clients before and after the trips, and the increased sales paid for the trips many times over. We tried doing the same thing flying commercially, and it didn't work nearly as well. It was a much bigger time commitment from our clients with less flexibility in the timing. Plus customers loved flying on the corporate jet, nobody talks years later about their commercial flight. 
 

In reply to Boost_Crazy :

I seem to remember it wasn't taxation the Founding Fathers were categorically against, it was taxation without representation. 

Boost_Crazy said:

In reply to frenchyd :

 

Well don't forget George Washington had to "put down" the Whiskey rebellion.   And Lincoln came up with the income tax idea. So taxes really are part of our culture.  

By that standard, refusing to pay taxes and attacking the tax collectors is also part of our culture. Lincoln wasn't even born until decades after our country's founding. He did institute an income tax, as a temporary measure after a civil war.

        Regarding flat tax idea.  Let's assume you make $20,000 a year  save 1/2 of it for a down payment on a house.  That's $200 in taxes.  If $20,000 isn't enough  to provide food clothing and shelter  his income needs to be raised.  Instead often that person is subsidized by welfare. 

However right now the owner he works for can buy a corporate jet, an apartment in New York and tickets to the opera and deduct all of them as business expenses.  
        If you doubt me go to any major city go out to the FBO at the airport and check the first dozen jets you find. Ask me how I know.  
      My sister worked for a HMO and her whole job was to design and decorate the offices for all the Vice Presidents they hired. Ask why they needed so many Vice Presidents.  

So why doesn't the guy who wants to buy a house learn a skill, get a better job, or work more hours? How about he starts his own business, buys his own corporate jet and apartment in New York, opera tickets, AND a bag of popcorn at the opera, and deduct them all? You are so focused on deductions and loopholes and tax dodges that you can't see anything else. Look a couple posts up to see who pays the taxes. The $20,000 guy pays zero. The business owner bought the jet with his own money. Yes, through the tax code, he was granted the privilege of keeping a bit more of his own money. He didn't get a free jet. He got a credit towards his taxable income. Just like if I buy solar for my house. Because the government wants me to buy solar, and it wants businesses to grow. Or it wants more corporate jets sold. Or both. In the end, he paid way more taxes, both in percentage and dollars, than his employee. Who has a job. That corporate jet guy pays payroll taxes to employ.

FYI, when the company I worked for was privately owned, our owner had a couple corporate jets. We could reserve them to take clients on trips to our headquarters. It was expensive, but worth every penny. They tracked sales from clients before and after the trips, and the increased sales paid for the trips many times over. We tried doing the same thing flying commercially, and it didn't work nearly as well. It was a much bigger time commitment from our clients with less flexibility in the timing. Plus customers loved flying on the corporate jet, nobody talks years later about their commercial flight. 
 

I too used the companies Lear.  A typical trip yielded over $500,000+  in sales with a gross of 15%+.  Plus sales wasn't the profit center.  Service  and parts were. Typical sales were in the 2-3% range.   
      The reason I was given access to the Lear  was to meet deductibility  rules.  Not for pure business purposes. Having been into corporations back rooms ( so to speak )  it's very rewarding to be at the Sr level or ownership.   I'm saying this not out of envy or bitterness because my income and benefits  was almost always near the top. Typically well above managers. 
  While it does happen, the majority of perks like Jets, yachts, hunting lodges, etc. aren't purchased by business start ups. But by the Sons and Grandsons of those.  Kids who were were given a silver spoon at birth and the best schooling  etc.  

    I understand parents buying the best  for their children but I've seen some of those same children  make major mistakes that cost the company dearly.  They ride the downturn comfortably while employees lose their Job, career , home and family paying for those mistakes. 
Not everyone. True enough,  but  enough so it's a recognizable issue. 

     

https://www.freightwaves.com/news/bank-of-america-is-sounding-the-alarm-on-collapsing-freight-demand/amp
 

interesting. 

In reply to Fueled by Caffeine :

That is interesting, I honestly never would have guessed.

I suppose it makes sense though, ports are the huge bottleneck right now, and you only need land freight for what can actually get through the ports.

The article doesn't explicitly state that the port bottleneck is the issue though, just that there is a dropping demand for trucking.  A quick look at Long Beach and they are still talking about issues of getting things off ships.  I would guess a slightly reduced demand (less free money) and higher prices has something to do with it also.

That of course could have a serious whiplash effect of course.  Demand drops, fewer truckers needed, when demand comes back up much harder to recover again.

There is definitely still a backlog of ships heading to LA/Long Beach though (all those on the bottom are waiting to go into LA / LB), pretty similar to a few months ago:

Also a massive bottleneck at the Mexican border in Texas with the inspections. I know it has ended (about a week ago?) but it slowed everything down to about 25% of what it had been. 

12/26/21, Freight for two door panels from NJ to SC, call it 700 pounds on a pallet that they can't stack. $445.00

4/25/22, Freight for two panels from NJ to SC, Same weight and size. $709.00

Crate charges have gone from $165.00 to $200.00.

 That is a significant increase and enough for a customer to not spend the money. 

I am getting the feeling that when this crashes, it's going to crash hard. 

In reply to Toyman! :

I am struggling to understand how it hasn't already crashed given everything that has happened since 2020...

It all feels like a castle built on sand.

aircooled said:

That of course could have a serious whiplash effect of course. 

I'm amazed that our super efficient / super fragile supply chian (looking at you Justin Tin) has taken this long to spiral out of control.

Today, planners commonly refer to this as the Bullwhip effect.

There's a famous case study about Volvo using a promotion to unload an excess of green cars which triggered their demand forecast to produce many more green cars.

My biggest concern right now is agriculture...a very significant percent of the world's wheat, corn, and probably most importantly, fertilizer comes from Ukraine & Russia.

I really, really wouldn't be making ethanol until the invasion is completely resolved.  There are so many developing nations that are living right on the ragged edge...like 10%+ interruption in food supply will, not may, cause mass starvation.

I've been wondering if Putin's objective is to jeopardize / hold ransom the world's food supply in the same way the allies targeted Germany's ball bearing factories...not having food is like not having ball bearings, it's game over.