axiomtek:  Interesting thread.  All over the place, too. 

About taxing cigarettes:  it has been a long time since I quit.  At that time, the generics were, at a bargain stand, about $26 a carton.  I live in a state where cigarette taxes are less than they are in a neighboring state, and the cops were always catching people loading up on cigarettes in one state to take to another.  The "rule" was, I believe, that one could purchase enough for personal use.  I don't believe they wanted people stocking their stores with cigarettes with no state stamp. 

I noted you made a reference to Milton Friedman.  Smart guy.  They don't make them like him anymore. 

He was one of the favored ones, according to my memory, of one William F. Buckley, Jr., who was also no slouch as to intellect.  I could be wrong about that association.  I've been wrong before.  (Once.)  One of my favorite quotes of Buckley was, "What is free medicine?  Free medicine is medicine that somebody else pays for."  My next question was, well, what happens when nobody works?

 As a rule, those that post anti tax rhetoric on these boards are usually government employees.

Not this government worker (and to think I've worked under three federal agencies).

Friedman always makes the same circular argument. 

Yes, the amount any employer can pay for given work is the same, no matter what the net pay remaining might be.

And yes, the FICA is regressive, but that is solved easily by removing the income cap.

The flaw in his logic is simple. Abolish SS, and the resulting old age poverty would have to be covered by state, county, and local funds. No net gain.

People are not born with equal talents and abilities. Nor is economic power equally shared as a result.

That's the flaw in his outlook.

As a self employed person, you'll find that your actual total Federal taxes paid, based on your net profit, will be less than 18% if your CPA knows what he's doing, and you're careful with your planning. Base it on gross profit and it's chump change.

Is that really too much to pay?

Don, watch the video.

Donmason

You may have thought that when Nick said I did not have an employer I don’t have a job. I’m self-employed and run my own mobile IT company, I’m not jobless.

I apologize for being presumptive.  As a rule, those that post anti tax rhetoric on these boards are usually government employees.

You comment that my apparent joblessness “explains everything” though is revealing. It sounds like you’re saying a person without a job I guess isn’t really qualified to talk about economics & politics?

When it comes to dialog about the real ramifications about the effects of policy on business, experience in business is the best teacher. I’ve found most of the alarmist issues have turned out to be irrelevant to a small business like mine.

 First I’m against “FICA” so you’re correct when you say “if a person truly believes in individual responsibility” that they would oppose state forced stuff.

Second I reject the idea that “the employer pays half” – It’s true that’s what we’re told, but I think this is an example of rhetoric vs reality. (example the “patriot” act?)

I guess you haven’t had to hire any employees yet. It’s the law. You must send in half the FICA, along with income tax withholding, or the IRS gets really cranky. In reality, the employer sends in 100% of the FICA, but 50% of it is deducted from the employee salary or wages.

I’d make my case but I’ll have Milton Friedman make it for me

I’ve read a great deal of Friedmans work. I’m more with the Mises school of economics. His work has been far more predictive of economic trends, and more pragmatic concerning the ramifications of economic policy.

The greatest flaw of Friedman is the assumption that all people have an equal ability for participation in our economic model.

This is akin to assuming that a poor soul born with Downs Syndrome can be a brain surgeon, if only they work harder than a Rhodes Scholar.

See,l if we would just adobt a national sales tax, then we wouldn't have this problem of what is taxed and what isn't.  It is a straight consumption tax..

http://www.fairtax.org/site...

What is the FairTax?

The FairTax plan is a comprehensive proposal that replaces all federal income and payroll based taxes with an integrated approach including:

• A progressive national retail sales tax.
• A prebate to ensure no American pays federal taxes on spending up to the poverty level.
• Dollar-for-dollar federal revenue neutrality.
• Repeal of the 16th Amendment through companion legislation.

• The FairTax:

  • Enables workers to keep their entire paychecks
  • Enables retirees to keep their entire pensions
  • Refunds in advance the tax on purchases of basic necessities
  • Allows American products to compete fairly
  • Brings transparency and accountability to tax policy
  • Ensures Social Security and Medicare funding
  • Closes all loopholes and brings fairness to taxation
  • Abolishes the IRS

http://www.youtube.com/watc...  :   )

--virgil

I'm going to take a wild guess here that Axiomtek is a devotee of Ms. Rand's fiction?  The one who cribbed storylines from Little Orphan Annie?

Freedom is all about options. Money gives us more options in the world.  You would agree that the more money you have, the more options you have for doing stuff, right?

First off, if you're arguing from the stance of true freedom, then we might as well just throw anarchy on the table, because that's the only way in which someone truely has the freedoms to do whatever they want without facing legal consequences.

Second, having more money does not always give one more options in the world.  It depends on what specifically you're speaking of, and the context.  I could be a millionare, or I could have $1 to my name - if I want to do something bad enough, I'll do it with or without the money.  Being I used to smoke a pack a day +, I know for a fact times in college when I had no money, but still chose to smoke.  Either I conserved the supply I had and smoked less cigarettes each day, or I bartered with friends to obtain that which I desired.  In some cases, I might even make a decision not to purchase something I wanted, so that I could afford a pack.  My lack of money didn't alter my freedom to smoke - it only changed to parameters around how I chose to smoke.  I still had the freedom to smoke or not to smoke.  That didn't change. This is no different than if further taxes were levied upon cigarettes, for the taxes themselves do not limit what a person can or cannot do, it only creates a new variable that they must consider before making the choice to purchase a pack.  Being we live in a society where there are laws, rules and parameters in place, I look at this issue as being so inconsequential that it's almost absurd for anyone to make such a big deal about this.  Funny enough, the majority of the people who are arguing your side of the equation aren't even smokers!

Well, a tax is a decrease of options, regardless of what I value.  I could value water one minute (cause I like to live, which is an arbitrary desire) and I could like ciggarettes the next (which is an equally arbitrary desire that is my own and no one can tell me otherwise).

I don't follow your attempt at making a point - water is essential to continue living, and therefore as long as you value making it past next week, you a forced to ingest it.  If you choose not to drink, you die.  However, tobacco is not something that we must ingest in order to live.  One can value tobacco, but in the end, it has no purpose other than to give someone enjoyment or pleasure, which is not equal to sustaining life itself.

You're arguing apples and oranges.

Whether you tax water or ciggarettes, or walking across the street, the fact remains that freedom is limited by absorbing opportunity and eating the money in a worse way than would have been used by you.

If you tax something that is essential to life, you are in essence denying someone the right to live unless they pay the tax.  If you tax something that is not essential to life, you are merely denying someone the right to purchase that product unless they pay the tax.  Once again, two completely different issues which have no real connection.  

By your arguments, I would assume that you would rather we not tax anything?

It's obvious to me that freedom is lost in the process, and the question may still remain as to whether or not that's a good thing.

Perception does not equal reality. 

I'll aree with you as to whether the idea of taxing tobacco further is a good idea or not is still up in the air, but I'm willing to look at all options that will help get us out of debt.

Rules against murder also decrease options.  I can live with that *AND* with a certain level of taxation, in exchange for schools, fire control and not getting shot down by my neighbor when I accidentally water his lawn along with mine.

Floridastate.

Freedom is all about options.  Money gives us more options in the world.  You would agree that the more money you have, the more options you have for doing stuff, right?

Well, a tax is a decrease of options, regardless of what I value.  I could value water one minute (cause I like to live, which is an arbitrary desire) and I could like ciggarettes the next (which is an equally arbitrary desire that is my own and no one can tell me otherwise).

Whether you tax water or ciggarettes, or walking across the street, the fact remains that freedom is limited by absorbing opportunity and eating the money in a worse way than would have been used by you.

It's obvious to me that freedom is lost in the process, and the question may still remain as to whether or not that's a good thing.

LOL~ he is a serious young man Cat! 

Hey is that a personal attack" almost sexual obsession" ROFLOL...I'm outta here......

Learnem,

I wanna be your friend - I really do.

--virgil

--Cleanup costs for cigarette butts (Oregon's complaining about those these days)

I can see why.  they are pretty unsightly.  It irks me when we have people over my house for some reason, and a week later, mowing the lawn, or cleaning up the side of the house, i find cigarette butts....we have friends that smoke, we OFFER ashtrays on the tables outside, yet they feel the need to litter.

I called one of them one time to come over and pick theirs up, as they were the only couple over that weekend, they did and apologized, but, have some common sense and respect

taxinging american idol because you dont like it?

It was a joke, Axiomtek.  Ugh.  Time for me to go.

Facebook, anyone?

Not to change the subject, but a tax on alcoholic beverages is being kicked around. That tap beer and a six-pack to go is going to cost you about 50 cents more.

LOL~ witbee! I *knew* you were a fan! And it is you and the other fans that keep Idol on the air. Coke wouldn't but ad time if you had some personal responsibility! ;-)

That's all I have to say on the subject because it's "off topic".

RF Wrote:  Economic growth for one.  I think that in the long run it's important to have government income and outgo match (barring emergencies like the current one.) 

Of course, there is both sides of this equation they could be workin on. I'd say try the outgoing (expense) first.  I'm not advocating that we have no tax as I too like clean streets and so forth.  But, when was the last time you heard about goverment taking on a process improvement?  Instead, all you hear about is layers of buracracy they put on to defend higher spending.  And, when asked to reduce budget, rarely ever do they cut off their own expenses.  They cut medcare, education and every other social policies and blame everyone for not collecting enough taxes. 

If you truly believe rasing taxes on successful people is the right thing to do, I have nothing more to say to you.  Should I apologize to you for trying harder in school?  Should I be blamed for working longer hours?  Heck, if you feel that way about it, let's go to cosumer tax or ever flat tax system. 

by the way, the fact that everyone here is competing against eachother on who can think of the most ways to tax us is really sickining. Some on th left honestly have a sexual obsession with thinking of really uncreative and just bizzar ways of taxing people for the sake of it.

taxinging american idol because you dont like it?

  "So AI is your fault. I'm sorry to have to tell you."

Well,  

"Let them drink Coke ! "

Is what I say - just don't let my daughters know it's in the house.

--virgil

Donmason

You may have thought that when Nick said I did not have an employer I don’t have a job. I’m self-employed and run my own mobile IT company, I’m not jobless.

You comment that my apparent joblessness “explains everything” though is revealing. It sounds like you’re saying a person without a job I guess isn’t really qualified to talk about economics & politics?

This is akin to saying “Wait, axiomtek doesn’t have cancer and he’s ranting about why cancer is bad, that explains his position”

First I’m against “FICA” so you’re correct when you say “if a person truly believes in individual responsibility” that they would oppose state forced stuff.

Second I reject the idea that “the employer pays half” – It’s true that’s what we’re told, but I think this is an example of rhetoric vs reality. (example the “patriot” act?)

I’d make my case but I’ll have Milton Friedman make it for me

http://www.youtube.com/watc... – go to minute 8:05

Sage- Your drinking Coke is keeping American Idol on TV. They are the major advertizer. if you drive a Ford, even more so.

So AI is your fault. I'm sorry to have to tell you.

You may scream in anger now.

Any sales tax is going to be regressive--it will hit the lower-income harder than the upper-income.

"Without such "friction," you get a situation where the second million is easier to get than the first, and the tenth billion easier than the fifth.  Such a system--it seems to me--would quickly accelerate out of control."

Very true.  The final result is crony Capitalism. We've been down that road a number of times, with the Robber Baron era being the most blatant example.

When one guy gets all the marbles, we all lose.

FSG, if that's the case then raise taxes on EVERYTHING..including taxing unprepared food.  Some states already do that but lets make it across the board... that way it's a fair tax on EVERYONE since we all eat.  Why target just one segment?

I think we should target multiple segments.  I believe we should tax alcohol further, as the revenues generated would help decrease our debt, and people will still choose to drink regardless (me being one of those people).  I believe we should levy more taxes on gasoline, which would once again force the general public to think before they get in that SUV without planning out their route.  I was happy with gas prices above $4 a gallon because it finally made people wake up.  I think we should legalize illicit drugs, produce them in government regulated facilities and tax them - we'd make a fortune and solve a number of other major issues in the process.

However, taxing food would go against Obama's plan of ensuring that no family making less than $250,000 would see a forced tax increase.  We all must eat to survive - therefore IMO food shouldn't be taxed. 

Tax ice cream, chips, cookies, candy, after all none of those are necessities and it's a choice people make.

I'll give you that one.

You choose to do a lot of things.  Drinking water is one of those things.  No one is telling you to live or die, but this isn't about life or death, is it?  It's about having the maximum number of choices in life that don't impede on others' choices.  Raising the tax on ciggarettes is an unnecessary decrease of freedom.

I disagree.  We all need water to sustain life.  We do not need tobacco to sustain life.  As it pertains to the "maximum number of choices in life that don't impede on others' choices," - please tell me how exercising a higher tax on tobacco would limit someone's choice to use such products?  There is nothing the Government would be doing that would take away that choice - it would merely be upping the ante, so to speak.  You can still smoke, you just have to pay more for it.  How is that different from anything else we purchase in society that is not neccisary for life to be sustained?  Such a tax isn't dictating what one can believe, nor is it dictating what one can do or say.  In the grand scheme of things, such a tax isn't going to take away someone's inalienable rights.

Hey Random,

Another source for tax revenue, never mentioned, would be a tax on currency trade transactions.

Trillions of dollars in currency trades happen every day, but most are for speculation, and not for closing international trade transactions.

A 1% tax on trades would generate billions per day, while forcing transparency on a speculation base that’s proven to be highly destabilizing to currency values, and it would lower capital flight from less stable banking systems. 

The trades add no real value, but simply exploit paid interest rate differences between nation states.

Capital created in the USA should remain in the USA banking system.

Half of your Social Security tax is paid by your employer. It's not voluntary. It's required by law.

And if it weren't, the wages would be equivalently higher to enable you to pay it.

I'll make it very simple for you Nick.

Half of your Social Security tax is paid by your employer. It's not voluntary. It's required by law.

The SS benefits are for the employee, not the employer.

Why would a "Free Market", "take personal responsibility" individual expect the employer to pay this tax for them?

  Ms. Jenny,

"...I guess that's why i am on diet ... "

You gotta be careful with that dieting stuff and do it right.  Loook at what happens if you don't :

http://www.youtube.com/watc...

There is a language thing though ( just a bit of "off-color"  language - in the title ).

--virgil

'Optimum for WHAT' is the question. 

Economic growth for one.  I think that in the long run it's important to have government income and outgo match (barring emergencies like the current one.) 

Having funding available for such things as roads, schools, police and fire, etc. is a net positive to the country even if it means taxes are higher.  I believe (though cannot prove) that without those things the costs would be higher (unchecked wildfires, etc.) than the total tax cost of those services.  The cost to the rich would also be higher than the cost of taxes *THEY* pay.

In the case of returning to the 90's-era tax rates, there was a general rising of standard of living for all income groups that has *NOT* been seen under the past years of Shrub's term.  Speaking ecologically, I think that the current situation, where wealth is increasingly concentrated at the very top alone, is not a healthy situation and is not sustainable. 

I look at the progressive income tax system as somewhat analogous to the speed-of-light restriction in the universe.  The faster you go (the richer you get) the harder an incremental increase should be.  Without such "friction," you get a situation where the second million is easier to get than the first, and the tenth billion easier than the fifth.  Such a system--it seems to me--would quickly accelerate out of control.

Hong Kong's tax situation seems to bear that out--they go through wild oscillations of deficits and surpluses.  What do you think of a Hong-Kong-style "stamp tax" on stock transactions, by the way?

Donmason

"If a person truly believes in individual responsibility, and a total free market outlook, how can this be justified? Wouldn’t they want to pay it all themselves?"

I'm going to admit that I don't understand your question.  It seems like you're agreeing with me, but I detect either sarcsm, or that I'm just simply missing something.

Care to elaborate?

however, that still doesnt answer the original question about how many nicotine habits the taxpayers are funding

You'd have to count the number of such prescriptions, I guess.   My point was that between taxes and tobacco subsidies, tobacco is a net *POSITIVE* to the government--if you leave out the incredible cost of

--Medicare payments for O2 machines to treat emphysema, cancer surgeries, etc

--Lost productivity

--Firefighting costs for smoking-caused fires

--Cleanup costs for cigarette butts (Oregon's complaining about those these days)

The government's not actually encouraging anyone to smoke--tobacco subsidies *RAISED* the cost of tobacco, they didn't make it cheaper.

Hold on randomfactor,

"There *IS* an optimum tax rate.  You assume it's lower than present (on those making $250k plus, anyway).  I assume it's higher."

Stop right there.  You say 'optimum'. 'Optimum for WHAT' is the question.  In the case of increasing tax revenue, then yes, you may be right.  But in the case of maximizing the production of goods and services, you would be wrong.  We only disagree on the intent of a tax hike.  If the intent of a tax hike is to get more money for the government, then fine, it can do it's job, but if at the same time there is less stuff to go around, then no one wins (except special interest groups).

Obama's statement at the head of this post clearly means that his *INCOME TAX* proposals would not raise taxes on anyone under $250,000.  And they won't.

thats the way  i read it too.  this ISNT an income tax...but a goods tax

So a guy that won’t work is 

Actually, I think he's self-employed. 

Those involving the "patch" or the nicotine gum and covered under publicly-funded health insurance.

thats like a woman on welfare having the public pay for her norplant......attempting to stop more bleeding of taxpayer funds....I DONT see a problem with these issues of attempting to stop smoking/having babies on the taxpayer dime.

however, that still doesnt answer the original question about how many nicotine habits the taxpayers are funding

But the Laffer curve is nothing more than a bell curve drawn on a napkin.  It applies equally well to many situations.  And you simply restate what *I* said.  There *IS* an optimum tax rate.  You assume it's lower than present (on those making $250k plus, anyway).  I assume it's higher.  My evidence for that is that the nation as a whole was doing better when it was higher.  Your evidence to the contrary is?

We were also doing better when banks were more tightly regulated.

.

I'd be ok with the Hong Kong model.  Know where that surplus came from?  From a tax on individual stock transactions.  I think that is a *WONDERFUL* idea to supplement the income tax.  I wish we'd do it here--there's *WAY* too much leeway given to the players in the vast crapgame which is the stockmarket.

I'd also be OK with a flat tax here.  Say, 35 percent, and the first $100,000 of income exempted.  Might not need to be that high if they go with the stock market tax.

Donmason, Axiomtek doesn't have an employer.  Perhaps you should stop spewing false ad hominem counters so that you can debate what is real and what matters.

lol  So a guy that won’t work is ranting about free market enterprise, lack of individual productivity, and compromised incentives ? Thanks, that explains everything.

So Nick, employer paid FICA is an expense put on employers that reduces profit, raises final product cost, and reduces the number of employees the employer can afford to hire.

If a person truly believes in individual responsibility, and a total free market outlook, how can this be justified? Wouldn’t they want to pay it all themselves?

Rhetorical for sure, but totally on topic to the original post.

Can you imagine how upset people would be in liberals advocated tax increases, or minimum wage hikes like this? Of course when do gooders advocate ideas like wage hikes this is exactly the consequences are. There’s no difference in the reasoning, just a difference in the rhetoric.

Employer paid FICA IS a wage hike to the employer. This law was enacted by “do gooders”. Just  referring to the original post.

Obviously, you’ve never had to be responsible for weekly payroll, or all the hidden costs required by law.

Disclaimer: I always  paid my employees FICA as a necessary cost of doing business, but then again, I’m not a naive Free Market drone.

randomfactor, the Laffer Curve wasn't invented to explicate some specific scanario, it was used to illustrate ALL possible scenarios.  The Laffer Curve doesn't tell us WHERE the optimum tax rate is, it tells us THAT there is one.

The Laffer Curve shows that changes in taxes will make changes in tax revenue, but not always by positive correlation.

But, the incentives to create goods and services are different from a bottom line of tax revenue.  Our deabte is over the incentives to produce goods and services, not about the government getting more taxes.

But, if you still don't believe me, go look at Hong Kong, the only nation to have a government surplus (if I'm not mistaken).  Oh, and they have a 15% flat tax.

*looks innocent* who me?

Back to the serious topic at hand folks~ I'm off to get my fix.

u guys are off topic :P

saber: have not died from eating chunky monkey, though i am fat, I guess that's why i am on diet,,LOL LOL

blog drift~ it happens and is often the size of Texas....

A Texas sized bowl of chocolate chip cookie dough ice cream,that is!

You guys are all way off topic haha

Wa-ha-hait a minute.  I never said anything about an ice-cream tax.  You guys can just turn yourselves around from THAT idea and go back to where we were a minute ago.

Erase!  Erase!  Erase!

Oh yes it is to die for!!

Cinnamon Buns ice cream?  Interesting...  Ok, we'll all have to agree ice cream is NEVER to be taxed.

NancyII

Tax ice cream

Leave my Ben & Jerry's Cinnamon Buns alone darn it!!! LOL

Errkk..you guys are torturing me.  Cherries Garcia and my wallet clash.  But another not to be missed experience.  I found a way to limit my intake though.  Vons has miniature cups for a dollar.

All I have in the freezer right now is vanilla and I'm having such withdrawals that last night I had a Hostess chocolate cupcake with ice cream on it .  Sigh, necessity is the mother of invention.

And what happens the next time around, randomfactor?

The next time around?  The next time I earn (or get without earning) income I pay taxes on that too.  

Arthur Laffer (of the cocktail-napkin "curve") got it wrong because he made one unwarranted assumption.  He made the same argument you are, that increasing taxes decreases investment, or productivity, or labor, or some such.  His assumption was that we were at a point on the "curve" where that would happen.  We weren't. 

Fortunately, we've got history to show us the way.   Reagan lowered taxes.  The economy got worse.  He raised taxes.  It got better. 

Shrub lowered taxes.  The economy got worse (once his bubble burst).  We'll put them back where they were and things will get better again.

There *DOES* exist a place where taxes--a necessary evil--are at an optimum level.  Democrats are *FAR* better at finding that point than Republicans are.

Remember how income taxes were back in the 1950's?  Ah, the Good Old Days.