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[–]Eyevory0 points
1 point
1 point
(+1|-0)
ago
(edited ago)
First of all the cuts it would take to balance a budget when he is cutting the revenue by $2 Trillion over a decade would be massive. There isn't a single program that exists today that wouldn't need to be cut to some degree, and although I'm sure there are areas that could benefit from some cuts, I can't possible believe that it would be as easy to do as he makes it sound. In effect what he is suggesting is that our budget deficits rise even more until the point where the debt service payments would outpace GDP.
Second, a flat tax sounds nice on paper, but in reality it only serves to benefit the wealthy. The lower and middle classes pay a disproportionate amount of their income on basic needs such as food, shelter, clothing, healthcare etc. Keep in mind the price of a loaf of bread doesn't change whether you make $25,000 a year or $2.5MM. Same is true for a gallon of gas, a kilowatt of electricity, a parking ticket, or a tube of Crest. This results in those with more disposable income being able to save more since they have "extra", whereas those with more limited incomes barely manage to scrape by.
A flat tax is not a fair tax. Those who benefit from our economy the most should in fact pay a little bit more, and history has shown that when you have a progressive (aka: tiered) tax system, the upper income earners are more willing to reinvest income earned from businesses etc which in turn fuels the economy. When tax rates on the wealthy are cut, the gap between rich and poor grows and income inequality becomes a major issue such as we are experiencing today. Paul's plan would only serve to exacerbate that inequality... but it surely would please his wealthy benefactors as they would see their taxes drop from ~35% to less than 15% while the lower and middle classes could possible see their effective tax rates INCREASE due to the elimination of family and child tax credits.
Sorry but this is a non-starter. This is just pandering to the wealthy, but in reality this plan would create more problems than it solves. Horrible, horrible idea. A much better plan eliminates all tax credits and deductions as well as all loopholes. It then says every individual can earn X dollars a year tax free (for sake of argument, let's just say that number is $35,000). After that point, you have anywhere from two to five tax tiers that look like this (again just an example):
A plan such as this incentivizes upper income earners to reinvest money on new inventory, new employees, new facilities etc. However it also ensures nobody is dissuaded from trying to better themselves as incomes are never taxed at the rates we had in decades past when rates could reach above 90% for the upper incomes. The gap between rich and poor wouldn't continue to expand because tiers help to shift the tax burden upon those who can most afford it.
Also, the elimination of the inheritance tax or "death tax" is one way to ensure wealthy families continue to control the vast amount of wealth in our nation. In reality these taxes only ever impact a small percentage of the ultra wealthy, but never have any impact upon the average American, so how Congress has sold the public on those taxes being bad is beyond me.
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[–] Eyevory 0 points 1 point 1 point (+1|-0) ago (edited ago)
First of all the cuts it would take to balance a budget when he is cutting the revenue by $2 Trillion over a decade would be massive. There isn't a single program that exists today that wouldn't need to be cut to some degree, and although I'm sure there are areas that could benefit from some cuts, I can't possible believe that it would be as easy to do as he makes it sound. In effect what he is suggesting is that our budget deficits rise even more until the point where the debt service payments would outpace GDP.
Second, a flat tax sounds nice on paper, but in reality it only serves to benefit the wealthy. The lower and middle classes pay a disproportionate amount of their income on basic needs such as food, shelter, clothing, healthcare etc. Keep in mind the price of a loaf of bread doesn't change whether you make $25,000 a year or $2.5MM. Same is true for a gallon of gas, a kilowatt of electricity, a parking ticket, or a tube of Crest. This results in those with more disposable income being able to save more since they have "extra", whereas those with more limited incomes barely manage to scrape by.
A flat tax is not a fair tax. Those who benefit from our economy the most should in fact pay a little bit more, and history has shown that when you have a progressive (aka: tiered) tax system, the upper income earners are more willing to reinvest income earned from businesses etc which in turn fuels the economy. When tax rates on the wealthy are cut, the gap between rich and poor grows and income inequality becomes a major issue such as we are experiencing today. Paul's plan would only serve to exacerbate that inequality... but it surely would please his wealthy benefactors as they would see their taxes drop from ~35% to less than 15% while the lower and middle classes could possible see their effective tax rates INCREASE due to the elimination of family and child tax credits.
Sorry but this is a non-starter. This is just pandering to the wealthy, but in reality this plan would create more problems than it solves. Horrible, horrible idea. A much better plan eliminates all tax credits and deductions as well as all loopholes. It then says every individual can earn X dollars a year tax free (for sake of argument, let's just say that number is $35,000). After that point, you have anywhere from two to five tax tiers that look like this (again just an example):
0 - $35,000: 0% $35,001 - $75,000: 15% $75,001 - $150,000: 25% $150,001 - $300,000: 35% $300,001 - Max: 50%
A plan such as this incentivizes upper income earners to reinvest money on new inventory, new employees, new facilities etc. However it also ensures nobody is dissuaded from trying to better themselves as incomes are never taxed at the rates we had in decades past when rates could reach above 90% for the upper incomes. The gap between rich and poor wouldn't continue to expand because tiers help to shift the tax burden upon those who can most afford it.
Also, the elimination of the inheritance tax or "death tax" is one way to ensure wealthy families continue to control the vast amount of wealth in our nation. In reality these taxes only ever impact a small percentage of the ultra wealthy, but never have any impact upon the average American, so how Congress has sold the public on those taxes being bad is beyond me.
[–] 9-11 ago
flat tax is just code for "i think i'm wealthy but i'm really not".