The accuracy of the numbers is in doubt. At least a few of the very richest would be included in those who are paying nothing for lunch. And even minimum wage workers pay social security, state and local taxes - no free lunch for them. In fact, a much higher percentage of low income workers discretionary (not for essentials) income goes for taxes.
As the gap between the very affluent and the poor in the US has widened substantially over the past 2 decades, both by the rich getting richer and the poor getting poorer, it seems unlikely that the rich are being gravely compromised the tax system, or that the poor are making out like bandits.
The conclusion of the story, that through our tax system the rich are victimized by the poor, is not just untrue; it is ridiculous.
-----Original Message----- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED] Behalf Of William H. Magill Sent: Saturday, March 06, 2004 3:35 PM To: University City List Subject: [UC] Interesting: Taxes in perspective ...
Begin forwarded message: > Sometimes Politicians can exclaim; "It's just a tax cut for the > rich!", and > it is just accepted to be fact. But what does that really mean? Just > in case > you are not completely clear on this issue, we hope the following will > help. > > Tax Cuts - A Simple Lesson In Economics > > This is how the cookie crumbles. Please read it carefully. > > Let's put tax cuts in terms everyone can understand. Suppose that > every day, > ten men go out for dinner. The bill for all ten comes to $100. If > they paid > their bill the way we pay our taxes, it would go something like this: > > The first four men (the poorest) would pay nothing. > The fifth would pay $1. > The sixth would pay $3. > The seventh $7. > The eighth $12. > The ninth $18. > The tenth man (the richest) would pay $59. > > So, that's what they decided to do. > > The ten men ate dinner in the restaurant every day and seemed quite > happy > with the arrangement, until one day, the owner threw them a curve. > > "Since you are all such good customers," he said, "I'm going to reduce > the > cost of your daily meal by $20." > > So, now dinner for the ten only cost $80. The group still wanted to > pay their > bill the way we pay our taxes. > > So, the first four men were unaffected. > They would still eat for free. But what about the other six, the > paying > customers? How could they divvy up the $20 windfall so that everyone > would > get his 'fair share'? > > The six men realized that $20 divided by six is $3.33. > But if they subtracted that from everybody's share, then the fifth man > and the > sixth man would each end up being 'PAID' to eat their meal. > > So, the restaurant owner suggested that it would be fair to reduce > each man's > bill by roughly the same amount, and he proceeded to work out the > amounts each > should pay. > > And so: > > The fifth man, like the first four, now paid nothing (100% savings). > The sixth now paid $2 instead of $3 (33% savings). > The seventh now paid $5 instead of $7 (28% savings). > The eighth now paid $9 instead of $12 (25% savings). > The ninth now paid $14 instead of $18 (22% savings). > The tenth now paid $49 instead of $59 (16% savings). > > Each of the six was better off than before. And the first four > continued to > eat for free. But once outside the restaurant, the men began to > compare > their savings. > > "I only got a dollar out of the $20," declared the sixth man. > He pointed to the tenth man "but he got $10!" > > "Yeah, that's right," exclaimed the fifth man. "I only saved a dollar, > too. > It's unfair that he got ten times more than me!" > > "That's true!!" shouted the seventh man. > "Why should he get $10 back when I got only $2? The wealthy get all > the breaks!" > > "Wait a minute," yelled the first four men in unison. > "We didn't get anything at all. The system exploits the poor!" > > The nine men surrounded the tenth and beat him up. > > The next night the tenth man didn't show up for dinner, so the nine sat > down and ate without him. But when it came time to pay the bill, they > discovered something important. They didn't have enough money between > all of them for even half of the bill! > > And that, boys and girls, journalists and college professors, is how > our > tax system works. The people who pay the highest taxes get the most > benefit from a tax reduction. Tax them too much, attack them for being > wealthy, and they just may not show up at the table anymore. > > There are lots of good restaurants in Europe and the Caribbean. > > David R. Kamerschen, Ph.D. > Distinguished Professor of Economics > 536 Brooks Hall > University of Georgia
T.T.F.N. William H. Magill [EMAIL PROTECTED] [EMAIL PROTECTED] [EMAIL PROTECTED]
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