Comment by AnthonyMouse
2 days ago
> to fund trillions in tax cuts for the .1%
That isn't even what your link is saying. To begin with, it's citing a Treasury Department document requested by the Biden administration to do an analysis comparing the proposed tax cuts with a contrived alternative.
If you do generic across-the-board tax cuts, not targeting any particular income group, everyone's taxes are reduced in proportion to how much they were paying to begin with. Obviously then the people who make more money and pay more taxes have them reduced by the given percentage and that is a larger absolute number.
The same thing happens even if you target only the brackets for people who make less money. Suppose you lower the rates by 2% for every bracket below $400,000. That's not even enough to be in the 1% (for which you'd need to make ~$800,000), much less the 0.1%, but what happens in that case? Well, everyone's taxes go down by 2% of their income up to $400,000. If you make $40,000, they go down by $800. If you make $400,000, they go down by $8000. If you make $4,000,000, they also go down by $8000, from your first $400,000 in income. The absolute amount of the reduction is still highest for people who make more money, simply because it's a percentage of higher number.
The analysis the Biden administration requested was to do the tax cuts for people making less than $400,000 and then raise the tax rates on people above $400,000 to make sure they didn't get any net reduction, and their contrived example would have people making $400,000 paying a higher tax rate than people making $500,000+. Basically the purpose of the analysis was to generate a large number to put in a headline rather than compare it to a real proposal to lower taxes in general. This is also why they announced the cumulative total over a decade rather than listing the annual number as you would when comparing it against an ordinary government budget. Because "~3.5% of the budget" sure sounds a lot less than "trillions of dollars".
> that isn't even what your link is saying.
You can find any number of links talking about how unequal the tax cuts are. No one in the bottom 60% is going to be better off. The .1% are benefiting the most. That's an insane thing to do in an economy that's already breaking records for inequality.
> If you do generic across-the-board tax cuts
That's not what these are. The reaction of every billionaire to Trump's admin ought to tell you that on it's own.
> Because "~3.5% of the budget" sure sounds a lot less than "trillions of dollars".
Trillions of dollars are trillions of dollars.
A million seconds = ~11.5 days A billion seconds = ~31.7 years A trillion seconds - 31,710 years.
We're not talking about play money, or monopoly money. Musk bought the election for a fraction of a billion dollars, ffs.
And again, America is already on record inequality, about the same or more as right before the French Revolution.
Money IS a zero sum game, and when too much of it is going to the 0.1% it inflicts massive harm to millions of people. If you want to learn more about this, and what's about to happen to the US economy, you can listen to one of the world's best traders talk about it here [0].
0 - https://www.youtube.com/watch?v=XCnImxVWbvc
> You can find any number of links talking about how unequal the tax cuts are.
All of those links are comparing dollars rather than percentages. It's obvious that a given percentage of $400,000 is more than the same percentage of $40,000.
> That's an insane thing to do in an economy that's already breaking records for inequality.
The cause of inequality isn't taxes, it's market consolidation. Rich people are rich because they own a large fraction of a megacorp. Under the existing system, higher corporate taxes, if anything, increase market consolidation because massive international corporations can use cross-border avoidance mechanisms whereas smaller purely domestic corporations can't, so they're effectively a tax on businesses too small to get out of them.
> That's not what these are.
It's essentially what they are, and the rate reduction in the lower brackets was slightly more. The highest bracket was lowered by 2.6% whereas the brackets from ~$12k to ~$100k were each lowered by 3%. And as a percentage of taxes paid, 39.6% was only 7% more than 37% at the top, whereas for the working poor 15% had been 25% more than the current 12%.
> Trillions of dollars are trillions of dollars.
You can turn any annual amount into trillions of dollars by multiplying it by an arbitrary number of years. And the only reason it can get so big so fast is that the US government spends a stupefying amount of money, so if you reduce it by even a small percentage it's a big number.
> Money IS a zero sum game
This is definitely false and is one of the major fallacies in the taxes vs. inequality problem.
In general people don't actually store wealth as money. Rich people store it as stocks and things. So if you tax them, you're not causing them to have less cash, or even causing them to sell their car or mansion. You're causing them to sell stocks.
If the person you transfer the money to is doing anything with it other than buying the same exact stocks, you're reconfiguring the economy, which is very much not zero sum and could be negative or positive sum depending on who gets it and what they do with it.
But Wall St. and Main St. are somewhat isolated pools of money. Making a transfer from one to the other has effects not entirely unlike printing new money and handing it out, because it gets spent very differently than it would have otherwise. And this is the nasty part: The sources of inequality are money sinks.
If you're paying high rents because there is a housing shortage as a result of captured zoning boards inhibiting new construction, and all the tenants suddenly have more money, the rent is going up. That's one of the reasons you can't solve it with taxes. You have to address the actual causes of inequality -- market consolidation and regulatory capture. Otherwise the incumbents just take the money right back out of your pocket.