The 1% Solution to the National Debt

WhoWee

Again - the "1%" didn't mean 1% of the population - the thread is focused on people with an ability (assets) to participate and has been expanded to include corporations.

Pattonias

This would be the problem if the debt was under some sort of control. Right now both the good guys and bad guys are getting worried. When we have to raise our debt limit in order to pay the interest on our current debt, the good guys should be worried. In your household that would be getting a new credit card to -not pay off- but pay the interest or minimum payment on your other credit cards. The problem that we will be facing in my lifetime is that the good guys will stop investing money in the United States and everyone will lose.

I can't agree with any plan that would require a select few to take on a debt they had no part in creating. To include companies and wealthy individuals it would be ridiculous to look to them to "fix" the debt problem. There is no scheme or quick fix. The government needs to balance the budget and spend the next 100 years paying off the debt.

A little debt is a good thing for a growing economy, a large debt is a terrible thing for a shrinking one.

JDoolin

I found kind of an odd counter-example to this: Commodities; There's something kind of fishy about making long-term investments in commodities. People that invest in commodities for the long haul, rather than buy from the farmer and sell to the grocery stores to provide liquidity. It drives the prices of food up and causes people to starve.

ThinkToday

Nothing unusual about it. As someone that grows corn, if the price early summer is $2.50/b and I think I can grow 40,000b. I may contract 20,000 at $2.50. If crops look bad, I can still probably grow 1/2 the normal yield and not have to buy more expensive corn to meet the contract. However, if everyone looks to have a bumper crop that year, the price may drop to $1.85/b. In that senerio, I have half my crop sold at $2.50 and I'll suck it up at $1.85 for the rest. Or, I could store it into the winter (~$0.25/b) hoping for a rebound in prices. Farmers do this all the time. Commodities afford growers the option to avoid or minimize "take it or leave it prices" from buyers.

ThinkToday

As has been said "A rising tide floats all boats". People need to work, so we need jobs. If we want jobs, we need companies to want to open up business here. We need to drop corporate taxes low compared to all other countries, sort of like the state of DE does to get companies to set up shop there. I'd also have tax advantages for all dollars spent creating a US job. Honestly, IMO, companies pass taxes on to "us" anyway, so skip taxing them for ONLY the money spent here making jobs here. Lastly, you can't float a boat with big holes in it. Government has got to get out of the "we'll fix everyone's life for them" thinking spending as if there are no limits. Do their Article I Section 8 duties, and drop the rest to the States. The State's voters will let the State governments know the priorities in their area and how much spending/taxes they'll tolerate to get it.


They use to say "all politics are local" and they should be, but that's less true as the Feds step in and "local" control is gone.

Jimmy Snyder

Forbes has issued their annual list of billionaires. There are 1226 of them and their total net worth is $4.6 Trillion. Here's a story about it.

Forbes list of billionaires

Not all is well though. You see, the net worth of the top 1%, that is to say the top 12, is 450 billion. So 10% of all the billionaire's wealth is concentrated in the hands of the top 1%. Robert Agostinelli, spokesman for the Occupy Seattle movement has called for the government to step in and even things out.

Evo

It's one thing to provide for the unfortunate and disabled, even helping poor students get ahead to get out of a situation where they continue to need help and start contributing is smart. It's what a society should do, IMO. But this idea that there should be a cap on how much money a person can legally earn...o_O

(Evo shoves her $100 billion under the bed)

Pattonias

Quit being so unambitious. The moment you have 250k in personal assets all further funds are taxed 100% to the government. Imagine all the good the government could do with that kind of money. They could afford to wipe out corruption due to the massive amounts of money they could throw at it.

ThinkToday

Yea, a doctor can close up their office after 6-9 months and tell the patients to take a hike until the next year when they can start keeping THEIR money again. Image what it would be like if everyone that hit this $250k cap just bagged it for the rest of the year. Seriously, success should always be rewarded, not failure.

"They could afford to wipe out corruption due to the massive amounts of money they could throw at it." - IMO, as long as you have government you have corruption. Why else would the government need so much money but for paying off the people they want to vote for them? I sure as hell don't want the to government "throw" my money at anything. That's how we got to where we are.

Remember the movie Riddick, "you keep what you kill". i.e. I earned it. It's mine.

JDoolin

I see your attitude towards life, summarized in the bold-faced statement. So put this in contrast with the general view "Absolute power corrupts absolutely." However, it appears that your view is that whatever anyone is able to gain by any means is earned.

While I can't make a logical argument against that case, I can state a contrary opinion. I believe very strongly that we should make an effort to treat each other kindly. And not only treat each other kindly, but to be on the look-out for people who seek to "kill" us, and actively prevent them from doing so.

If you want to role-play this scenario on World-of-Warcraft, then more power to you. But if you want to bring that attitude into the real world, you should be stopped, by whatever means necessary.

The role of a democratic government is to create an agreed-upon set of laws, and to create a structure to enforce those laws. If the government creates laws that are not agreed-upon, or if the government fails to enforce those laws that have been agreed-upon, then it is corrupt.

And as far as "throwing money" at things, I actually think there is a strong case to be made for it. If I have a problem, what is the best way to solve it? Work at it on my own, for free, on my own time, or is it better to hire 10 smart unemployed people to work on figuring out how to solve the problem? If I want my children to be edcuated, is it better to hope that someone will come along and teach them out of the kindness of their hearts, or is it better to offer money to teach them?

As for the $250,000 salary cap, I don't like that idea very much either. I like a flat tax or a progressive tax; preferably without loopholes for capital gains. But I wonder whether we can really address the taxing issue without looking at the problem from an international perspective. Like how are Sovereign Wealth Funds affected by American national taxes? And are the wealthiest of Americans already pretty much immune to taxes anyway, since they can voluntarily move their assets anywhere they want? (By the way, (Q) How do you find a way to avoid taxes if you are a billionaire? (A) Probably, by throwing money at the problem. You hire enough lawyers and lobbyists until you get the necessary laws changed, and buy the enforcement agencies if you can't get the laws changed.)

Throwing money at a problem works, whether it sounds silly or not.

ThinkToday

It is obviously a figure of speech and has nothing to do with killing, hence the example I earned it. It's mine.

"So put this in contrast with the general view "Absolute power corrupts absolutely." However, it appears that your view is that whatever anyone is able to gain by any means is earned." <------- No where did I say "gain by any means", and I think your characterization implying "by hook or crook", is unfounded. The point is simple. I work for a wage, I get paid for my productivity, I pay the government for the military that protects me, the police that watch over my family, the trash collector, roadway care, etc., the services I use. I do not think it's my obligation to earn wages for those that don't because the won't, as opposed to those that can't.

Never have I ever stated or implied that we shouldn't treat each other kindly, look out for each other, or protect those that can't.

My best geared WoW players are healers, well, maybe my rogue now. So I help folks .

"Work at it on my own, for free, on my own time, or is it better to hire 10 smart unemployed people to work on figuring out how to solve the problem?" - So you'd hire 10 people to do what you could do on your own.....? And there's the problem.

I don't like the tax system at all. It penalizes the achievers, gives a pass to so many people they don't have an incentive to be cost conscious or efficient. It drives business away. As I posted above, Corp tax like Delaware to bring business back. ONLY give tax breaks for income spent by business creating U.S. jobs. IMO, drop the income tax and go to a consumption tax, like the States. Wave the tax on basic food (not prime rib, caviar, etc.), basic clothes (not Gucci, etc.), medical care (not comedic, elective, etc.), a basic housing (not the vacation home), etc. IMO, that catches the underground economy and the $$$ the rich spend on super cars, etc. and the catches taxes on the illegal money the drug dealers spend.

Your last point, take a look at how Mr. and Mrs. Gates handle their billions. Those folks (billionaires) give away a lot more than you give them credit for.

Office_Shredder

The lawyers are going to have a field day defining what's basic clothing and basic medical care, although that doesn't detract from the basic point that it's probably simpler anyway and has the advantages that you cited

JDoolin

"I.e." stands simply for "that is," which written out fully in Latin is 'id est'. "I.e." is used in place of "in other words," or "it/that is." It specifies or makes more clear. If you mean "for example" you should use e.g.

When you say "you keep what you kill". i.e. I earned it. It's mine. . I may have misinterpreted your meaning, but your busy saying what you didn't mean, and I'm still not sure what you meant. Now I believe you are making a hunting reference.

My observation has been that people don't so much earn a salary as negotiate a salary. The best negotiators make a "killing" (not a literal killing, but a figurative one, of course) where they manage to negotiate a payment far beyond what they deserve, whereas the lesser negotiators are "killed" (not usually literally, but figuratively--but sometimes literally) where they end up underwater on their debts, unable to afford anything that would get them out of their situation.

Well what is the difference between someone who won't earn a wage, and those who can't earn a wage? In what category do you place someone who has no car, no skills, nobody asking him to do anything, no ideas? There are a lot of people out there with literally nothing to do? Why? Because of productivity and efficiency, a lot less people are needed to produce the same amount of service.

But instead of living in a golden age, where the real wealth created by the massive increases in productivity are shared by all, we live in a society where all of the wealth is clotting among the people who believe "I earned it. It's mine."

Instead of "trickling down" from the rich to the middle-class, it is clotting among people who are mainly concerned with protecting their monopolies, and people who have been hired to protect those monopolies.

No, I'm not talking about problems that I could easily solve on my own. If I had the money, I'd hire somebody to fix my neighbors plumbing so that I could get a clean glass without washing it in their tub, or fix my other neighbor's leaky roof so I don't feel like I'm breathing in mold-spores whenever I enter their house. Once these friends of mine are in a little better situation, and I had money, I could hire them to do other stuff for me, like edit my website, create their own websites, open a day-care center, and thinktank for identifying and solving local problems. (I'm thinking of specific people I know who have really awesome talents, but are unemployed or minimum wage-earners, and have bad plumbing, and leaky roofs.)

The real problem is "the bottom line." We live in a world where the only reason to spend money is to make money. If I did hire those people to do those things, it would not lead to any direct profit for me. Like if we decided to have a national "fix-the-plumbing" and "fix-the-leaks" project, it would not directly profit anybody, and it would mostly reward people who are unemployed and "undeserving."

However, it would also put those unemployed people in a situation where they could get a good night's sleep for a change, and they might wake up, refreshed enough to go looking for jobs.

We have become so cost-conscious and efficient that is no longer an issue. The real issue is that we have become so efficient that everything we need is produced by a smaller and smaller number of working people.

Monopolies compound this issue, so that even if you are willing and able to work, you can only go and work for a company that is licensed to make that product. Patent law compounds the issue too, so if you want to go to work making a product that is NOT currently in production, you cannot make that without paying the patent-holder, whether that patent-holder has ever actually produced the product or not.

The only real problem that we're facing is materials shortages. If the population gets too high, there isn't enough food; But with the current advances in irrigation and plants, this should not be an issue at our current population level. The things driving up the prices of food are patent laws and market speculation in the commodities markets.

I have a couple of lines of questioning about Bill Gates, one regarding his earnings, and one regarding his charitable giving.

Regarding charities:
(1) Isn't giving to a charity the same thing as "throwing money at a problem?"
(2) How much tax exemption do you gain by giving to charity?
(3) What problem(s) is the Bill & Melinda Gates charity solving?
(4) Where is the money donated to that charity being funneled?
(5) What is the final destination of the majority of that money?

I don't know the answers to these questions; I just have a suspicious mind. When I hear of billions on billions of dollars going to fight malaria and educate children it seems strange, because I don't think it should cost that much.

So when the Bill and Melinda Gates foundation goes out to fight Malaria, do they find the most efficient means of fighting Malaria, and work to find an efficient method to implement that solution. No, they go to a pharmaceutical company and try to implement a "tiered pricing system" for a patented drug.

Getting the farmers better seeds. Again, those seeds are patented. The non-patented varieties of seeds will be displaced, and unavailable, and later on, the farmers will have to pay whatever price the monopolists set.

Establishing "common core standards" for education: http://www.impatientoptimists.org/po...tate-standards

(Exactly how many billions of dollars went to getting 48 states to adopt these common core standards?)

Making it harder and harder to graduate from high-school; making it more and more competitive. It is also just ignoring classes like shop and home-ec; basic survival skills that help you learn how to cook and clean, and do basic maintenance.

Yes, I see that Bill Gates has given a lot to charity, but it looks to me like all his charity is aimed in a direction that supports Bill Gates philosophy, and Bill Gates philosophy is all about competition and profits and intellectual property. And of course, I don't mean to pick on Bill Gates. I'm saying that ANYBODY who has billions of dollars is going to be prone to have a similar philosophy. ""you keep what you kill". i.e. I earned it. It's mine."

There's two ways to look at money. One is as a fluid that runs through the economy to keep it going so that people can get what they really need and want. (That's the category I'm in.) Another way to look at money is as an intrinsic good in itself. Something that is to be sought as a score to show as proof of your value. The problem is that most people that have a lot of money are in that latter category. They think that somehow they have "won" somehow, by accumulating so much money, but from the perspective of the economy, they resemble a blood-clot; something that is preventing the economy from working by preventing the blood from flowing.


Regarding earning:
(1) Bill Gates has "earned" on average 1 billion dollars per year, while a minimum wage worker "earns" $15,000 per year, and the median household income is $50,000. Did Bill Gates actually do the work equivalent of 67,000 minimum wage earners, or the work equivalent of 20,000 median households? (Actually that isn't fair, either, because those minimum wage earners don't accumulate 15,000 per year. The total accumulation is zero or less. Bill Gates earns INFINITELY more than I do as measured by wealth accumulation. Did he do infinitely more work?)
(2) What is the primary source of his income? Intellectual property rights of things he actually invented, or on things that other people invented? How many actual inventors are not benefiting from their inventions?
(3) Even counting innovations that Bill Gates came up with, how long into the future will Microsoft be collecting intellectual property rights on things they didn't invent, after Bill Gates passes away?
(4) How many people are prevented from working or innovating because Microsoft owns the intellectual property rights?

JDoolin

It might be more unusual than you think:

From "Griftopia" by Matt Taibbi

Now, Matt Taibbi lumps together commodities like oil and gas in the same sort of category as food; pointing out some statistics that suggest that international production of oil is up, and demand is down, but the speculation on the oil is what is causing the price increases.

wuliheron

I haven't had time to read through all this, but the op made me laugh.

For those who are not aware of it there are already some 400 Americans who are income tax exempt by presidential decree including Rupert Murdoch, owner of Fox News and one of the wealthiest men not only in the US, but the world. Trust me, he paid much less for his tax exempt status then 500 million bucks.

Anyway, my point is these people already own the system. If they can't afford to push for income tax exempt status like Murdoch they push for tax loopholes or even use Swiss bank accounts to hide their money. Those that do pay taxes already enjoy record low rates and if you want them to cough up the money to bail out the national debt you'll first have to actually make it worth their while by charging them higher taxes and closing all these loopholes and prosecuting all the illegal activities. Good luck with that!

Vanadium 50

I was unaware of this. Can you point me to a reputable source? It must include "Presidential Decree" and not be a settlement with the IRS.

ThinkToday

Well, grammar? Is that really your response? My grammar could keep you busy. I honestly could care less about me using i.e. as opposed to e.g. or just omit the word ‘example’, or if i.e. must be exclusive of all other things. The point is the same.

What isn't clear about "I earned it. It's mine"? lol, a “hunting reference”? Really? It's hard to fathom a mind that thinks along that line. The tactic of obscuring the point by picking on the language, grammar, etc., isn’t new. Perhaps, adding substance would help. Let put my point a different way. I’ll keep the money I earn, only paying the government for the services I use. If I go out to eat, I’ll pay my bill, and not the bill of the guy next to me. I’ll get gas in my car and pay for it, but not the car next to me. When I sell my old house and buy a new one, I’ll pay for it, but not the guy next to me. BTW, those are “e.g.” statements, rofl.

Yes, those of us that earn a salary work. We get paid the same for 30 or 80 hour weeks. Perhaps your work experience is sufficiently limited you don't realize that hourly workers negotiate their hourly wage too. The notion that we "negotiate a payment far beyond what they deserve" is so over the top it's hard to respond. I'm sure my hospital was falling all over itself to pay me more than they had too. Just as I'm sure the guy putting nuts on lugs in the assembly line is being cheated at $25/hr (what a friend was making in the early 80s). Also, perhaps you've never been swimming, but getting under water means you had to jump in first. Perhaps those that got under water where swimming beyond their ability. "e.g." maybe they should control their debt load to stay within their means under adverse conditions. I don't buy things I "want" if it has the potential to put things I "need" at risk. My first jobs were hourly, and I had to negotiate my wages, walking away from a couple jobs. Over the past 30 years, it’s been salary, and I have a lot more 40 plus weeks than short weeks. Being salary isn’t a big plus, if your services are in high demand, since your effective wage ($/hr) drops.


Seems pretty obvious, but I’ll give some examples. You know, the e.g. stuff, lol. Those that have “off book” income, 2nd and 3rd generation unemployed, and those that gave up looking for work would fit the “won’t earn a wage” bunch that collects benefits off those that to work. IMO, the “those who can't earn a wage” are the group at are too old, infirm, ill, and disabled. No one that I know would promote not caring for those that “CAN’T” take care of themselves. Productivity, may have an impact, but we can't continue to drive businesses away with taxes and excessive regulation. "No car, no skills, nobody asking him to do anything....", yep, that was me at one time. I turned out ok. We all start somewhere, which is often "nowhere". Meaning.... I swept floors in a cannery at working through college. Yep, pretty skillless, but hey, paid the bills.

Socialist nonsense, IMO. Who do you think creates wealth? The person that builds cars? Sure, without him….. we’d have to get….. another “guy” to take his place. There are lots of them around that want to work. Wealth is created by the people that sometimes risk all their assets to create a company, see it through the low/no growth period, hoping it survives, becomes popular, and doesn’t fail. Approximately 50% of businesses fail in the first 5 years, http://usgovinfo.about.com/od/smallb...whybusfail.htm The guy putting on lug nuts gets paid no matter what. Who made bond holders that financed GM over the decades whole after the government pushed them from 1st in line to get paid to the back of the line? The unions and government got GM and the wealth creators “investors” that started and maintained the company for decades got the shaft. Cash in all your retirement, savings, mortgage your home and open a business. Gamble it ALL. Cross your figures that healthcare, insurance, FMLA, etc. don't change enough to put you under, and then hope your workers show up, are productive, and don't hit you with too many OSHA complaints, union work rule violations, strikes, etc. On top of all that, you'll need to make sure your business succeeds with it's product. Ref. failure rate above.

Wealth isn’t a clotting disease. It’s the reason we (those of us that work) get up in the morning and go to work. The hourly union worker has a union monopoly system to protect them. So what exactly is wrong with people protecting what is theirs in the first place? America is the land of opportunity, not freebee central. Each has the opportunity to succeed or fail. Your 401k, 403b, Keogh, SEP-IRA, etc., is invested to do what???? You generate income to give away or go towards your retirement. When you die, will you give it all away or pass it on to your kids???? Wait, giving to your kids would give them and unfair advantage…. Why would you want to do that? My grandfather was a blacksmith, and I suspect he would be pleased that his hard working life enabled his progeny to better themselves. When I die, I hope to leave my kids a better start than I had, which was good. My parents gift to us was the education and a few bucks.

Hmm, read your words…. They are very telling. You would “fix my neighbors plumbing” so “I could get a clean glass”. You would “fix my other neighbor's leaky roof” so “I don't feel like I'm breathing in mold-spores “. You would “hire them to do other stuff for me”. You sure sound like the rich guy that does stuff for himself. And you are different how?

Yep, you got that right. Feel free to give away as much of your time and money as you want. However, as for my money “I earned it. It's mine.” FWIW, most people I know give a fair bit away, but WE choose because WE earned it and the right to choose.

While there are merits to your points, it misses one key point. Where are the wealth creators? Why won’t people invest in jobs here? Why don’t companies expand where they already have an operational base? Every town I’ve ever lived in attracted businesses the same way, and gave tax breaks, utility breaks, land giveaways, etc. We need a business friendly environment, like Joe Biden’s Delaware.

Wow, and Uncle Sam is looking at your thoughts through the computer screen! You are pretty cynical. There is way too much to comment on, so take a look at http://www.gatesfoundation.org/Pages/home.aspx . They plan on leaving the children well off, but giving most of their wealth away.

“The problem is that most people that have a lot of money are in that latter category.” --- based on? I’ve known a number of people in my life that would fit in the extremely wealth category, and NONE of them fit that description. While it has been sign of their success, none have considered it THE measure of their success. Some have bigger toys than we do, but some you wouldn’t know had much at all. I bet you have bigger toys than others, but that has nothing to do with you as a person. It’s clear to me that you are likely a good hearted person with good motives. In my experience, they measure success like we do… family, family, family.


(1) “Did Bill Gates actually do the work equivalent of 67,000 minimum wage earners, or the work equivalent of 20,000 median households?” --- Take a look at the wealth he created for those that work for him at ALL levels, the support businesses and their employees that exist because of him, etc. So yes, IMO, the trickle down jobs, businesses and economy from Microsoft can’t be ignored when the scales of one’s life are put to balance.

(2) You don’t think the government, national lab, private company, university, etc., that bought the equipment, funded the work, supplied the staff and resources shouldn’t own the patent. In that respect, Gates get what Gates creates, directly and indirectly. You think the world is going to set the table for you to eat dinner, NOT.

(3) Depends http://www.inventionstatistics.com/P...e_Periods.html

(4) Patents only protect the patent material. “e.g.” WoW, AutoCAD, Lotus Notes, etc. are all developed for Windows, but MS doesn’t own the patent on them. Nothing prevents you from developing Unix, Linux, LISP, or any other Windows based software. So invent away.

I hate long posts, btw, but you gave me a long one to comment on. In summary, I think you're a good person that has his/her approach to solving the worlds problems. Yours appears to be more based on outside intevention (government). I tend to fall back more toward the founders principles that require are great deal more personal responsibility. We can't be a society of takers. IMO, we have spent the time since the Great Depression creating Dependents, and we succeeded. One day there may be no one left to take from, or the "takees" will just move away.