[Vision2020] taxes for the lower 40%'rs

[heirdoug at netscape.net]

Tom-Tom,
 
Where do you come up with these things. You don't follow the example at all. You must spend more time looking things up while you are at work. You just don't have enough time to think about things when you get off.
 
D 
 
-----Original Message-----
From: thansen at moscow.com
To: heirdoug at netscape.net; vision2020 at moscow.com
Sent: Thu, 10 May 2007 9:52 PM
Subject: RE: [Vision2020] taxes for the lower 40%'rs


Wrong, No-Clue –
 
Using your analogy and applying how our tax system truly works, the tenth (richest) man would be sitting at a fully-catered banquet table while the fifth, sixth, seventh, eighth, and ninth men served the food and wine and paid for the banquet (out of their own pockets) as the first four men gaze into the restaurant wondering what it could ever be like.
 
Seeya round town, Moscow.
 
Tom Hansen
Moscow, Idaho
 
"We're a town of about 23,000 with 10,000 college students. The college students are not very active in local elections (thank goodness!)."

- Dale Courtney (March 28, 2007) 



From: vision2020-bounces at moscow.com [mailto:vision2020-bounces at moscow.com] On Behalf Of heirdoug at netscape.net
Sent: Thursday, May 10, 2007 9:21 PM
To: vision2020 at moscow.com
Subject: [Vision2020] taxes for the lower 40%'rs
 
>From Dr. David R. Kamerschen, Professor of Economics at University of Georgia: 
Suppose that every day, ten men go out for beer and 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 would pay $7. 
The eighth would pay $12. 
The ninth would pay $18. 
The tenth man (the richest) would pay $59. 
So, that's what they decided to do. 
The ten men drank in the bar every day and seemed quite happy with the arrangement, until on 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 beer by $20."Drinks for the ten now cost just $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 drink for free. But what about the other six men - the paying customers? How could they divide the $20 windfall so that everyone would get his 'fair share?' They 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 drink his beer. So, the bar 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 pay $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 drink 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 I!" 
"That's true!!" shouted the seventh man. "Why should he get $10 back when I got only two? 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 drinks, so the nine sat down and had beers 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 anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier. 



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