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This is for all you anti tax cut for the rich maniacs.
FOLLOW THIS VERY C-A-R-E-F=U=L=L=Y !
Dick E.
Subject: FW: Bar Stool Economics
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 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 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 $50 instead of $59 (15% 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 $9!"
"Yeah, that's right," exclaimed the fifth man. "I only saved a dollar, too. It's unfair that he got nine times more than me!"
"That's true!!" shouted the seventh man. "Why should he get $9 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 wh en 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.
David R. Kamerschen, Ph.D.
Professor of Economics, University of Georgia
For those who understand, no explanation is needed. For those who do not
I understand where you're coming from, and I see both sides of this issue, but I have several problems with your question and story.
1) You addressed those who think it is patriotic to pay higher taxes, yet you told a parable about tax brackets. These are related only in that they both involve taxes.
2) I don't believe that people tend to directly attack the rich when they are given bigger tax breaks. Usually people have enough sense to complain to policy makers, if they in fact complain.
3) It is a rare story in America for a rich person to leave the country solely because they felt bullied by the tax system. (Warren Buffett himself has stated on numerous occasions that the rich should pay MORE taxes)
I'm sure it's a combination of both. A friend told me(Store Manager)that even when they have a sale and the price is reduced 75% they still make a good profit. You know the big company lobbyist are working good in getting tax breaks for the big companies.
If you would have been paying attention here, during the pre-election campaign one of the issues we banged on BO about was his statement that he will raise the taxes on those earning over a certain amount of money a year. I'm sure you saw it at least once in the normal media. A few of the pro BO die hard liberals made the statement that it was patriotic to pay higher taxes to support the "too lazy to get a job"(my words) crew.
Believe me, I followed this election very closely. I understood the idea of paying higher taxes to be a broader idea focusing on higher taxes in general rather than just on the Obama plan. I believe that the people who said these things had prior convictions, and when the Obama plan came out, they supported it because they believe it is patriotic to pay higher taxes, not because it taxed the rich more. Maybe that's just me...
This is for all you anti tax cut for the rich maniacs.
FOLLOW THIS VERY C-A-R-E-F=U=L=L=Y !
Dick E.
Subject: FW: Bar Stool Economics
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 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 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 $50 instead of $59 (15% 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 $9!"
"Yeah, that's right," exclaimed the fifth man. "I only saved a dollar, too. It's unfair that he got nine times more than me!"
"That's true!!" shouted the seventh man. "Why should he get $9 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 wh en 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.
David R. Kamerschen, Ph.D.
Professor of Economics, University of Georgia
For those who understand, no explanation is needed. For those who do not
understand, no explanation is possible.
I'll go with you..
This comment was deleted.
[1 point] 1 year ago by deleted user ReplyYes they will. They will just deny it.
This comment was deleted.
[0 points] 1 year ago by deleted user ReplyI understand where you're coming from, and I see both sides of this issue, but I have several problems with your question and story.
1) You addressed those who think it is patriotic to pay higher taxes, yet you told a parable about tax brackets. These are related only in that they both involve taxes.
2) I don't believe that people tend to directly attack the rich when they are given bigger tax breaks. Usually people have enough sense to complain to policy makers, if they in fact complain.
3) It is a rare story in America for a rich person to leave the country solely because they felt bullied by the tax system. (Warren Buffett himself has stated on numerous occasions that the rich should pay MORE taxes)
4) You cited the wrong author: http://www.snopes.com/business/taxes/howtaxes.asp
This comment was deleted.
[1 point] 1 year ago by deleted user ReplyI was under the impression that rich corporations move to other countries more for the cheap labor than lower taxes.
I'm sure it's a combination of both. A friend told me(Store Manager)that even when they have a sale and the price is reduced 75% they still make a good profit. You know the big company lobbyist are working good in getting tax breaks for the big companies.
If you would have been paying attention here, during the pre-election campaign one of the issues we banged on BO about was his statement that he will raise the taxes on those earning over a certain amount of money a year. I'm sure you saw it at least once in the normal media. A few of the pro BO die hard liberals made the statement that it was patriotic to pay higher taxes to support the "too lazy to get a job"(my words) crew.
Believe me, I followed this election very closely. I understood the idea of paying higher taxes to be a broader idea focusing on higher taxes in general rather than just on the Obama plan. I believe that the people who said these things had prior convictions, and when the Obama plan came out, they supported it because they believe it is patriotic to pay higher taxes, not because it taxed the rich more. Maybe that's just me...
that's wayyyyy tooo long to read
Sorry. I guess it's not for people with a short attention span.
or a brain.