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PeakOil is You

Voodo Economics

Discussions about the economic and financial ramifications of PEAK OIL

Re: Voodo Economics

Unread postby Ludi » Sun 29 Aug 2010, 19:08:05

$this->bbcode_second_pass_quote('Outcast_Searcher', 's')omeone has to pay taxes to make that happen.[/color]



Doesn't it make sense for those with more income and more wealth to pay more of the taxes?

Wealth distribution in the US: http://www.youtube.com/watch?v=woIkIph5xcU

The flat tax is typically criticized for being a regressive tax, as it puts a greater burden on those with less.
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Re: Voodo Economics

Unread postby americandream » Sun 29 Aug 2010, 19:21:19

Sorry. Too many if's and buts. The market is either free from the outset and must stand on that basis or its interventionist and fails its own strict test of consistency. It is not my concern that said investor cannot afford this or that, it is merely my concern that all subsuidies be withdrawn IMMEDIATELY, across the board. The end of and total abolishment of any subsidisation of wealth creation starting with the low wage economies where wages are artificially held down by command and force, the full restitution of a fully informed global workers right to bargain the sale of his labour, party to party on equal terms, in the West as well as in China or India, the complete removal of all tariffs, the end of the use of mixed budgets for application in private use and instead the full privatisation of everything on a user cost basis. The end of armies as well as they enforce private subsidisation.

That is what is needed for the commons to be fully in a position to judge the worth of the private system as a place of resource allocation. Just as there must be an end to the subsidisation of the commons, so must there be and end to the subsidisation of the investor. Level playing field.

Anything else and you're no libertarian but another hustler on the make. Like Marx, I am all for the free market incidentally. I hate elastoplast remedies.


$this->bbcode_second_pass_quote('Outcast_Searcher', '')$this->bbcode_second_pass_quote('americandream', 'P')resumably as libertarien you will be in favour of the absolute freeing up of global trade, the removal of all overseas stationed Amercan led Western armed forces necessary to maintian resource imbalances, the complete removal of taxpayer subsidies underwriting the infrastructure used by private wealth and all the other hiddens provided by the commons to fund returns on investment (the environment comes to mind.)

A free market is precisely that. One devoid not only of the application of the fiscal to the taxpayer (its his taxes after all), but to that other hidden recipient, the investor.


Yes, that is implied, though I didn't state it explicity. I want to do away with the entire complex network of favors and incentives that our fiasco of a tax system has put in place.

I admit that may be hard on some investors, but OTOH, paying a much lower tax rate should more than compensate for that over time. For example, Barney Frank scored a lot of points with me for openly suggesting we eliminate all our foreign bases of our allies -- the ones where we pay and they benefit. (I would do this gradually, say over a decade, to give our allies time to adapt - but I certainly have endorsed the PRINCIPLE for a long time).

(Now - I don't see how to get it to work, and here's why. Every time I bring up a flat tax and use eliminating the tax credits for kids, and the tax deductibility of mortgage interest as examples of things that have to go away to achieve a flat and low tax rate -- well over 90% of people have a da** fit and act like I want to rape their grandma instead of fix the tax code.)
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Re: Voodo Economics

Unread postby Outcast_Searcher » Sun 29 Aug 2010, 19:26:14

$this->bbcode_second_pass_quote('Ludi', '')$this->bbcode_second_pass_quote('Outcast_Searcher', 's')omeone has to pay taxes to make that happen.[/color]



Doesn't it make sense for those with more income and more wealth to pay more of the taxes?

Wealth distribution in the US: http://www.youtube.com/watch?v=woIkIph5xcU

The flat tax is typically criticized for being a regressive tax, as it puts a greater burden on those with less.


Yes, it is frequently criticized by the left for being regressive, but it doesn't have to be that way. I think often that BOTH the left and the right let their idiologies get in the way of having an honest, rational conversation (which we seem to be having, and I appreciate.)

This is why I stated I advocate for having a single large personal deducation as part of the flat tax code.

Think how simple that could make things for personal income taxes.


1). You pick a number -- I'll use $30K as an example. That's the deduction all taxpayers get. That way no truly poor person pays income taxes. And the lower-middle class doesn't pay much. The figure could be different, perhaps $40K, and could be indexed for inflation, of course. The higher the figure, the higher the rate needed for the flat tax -- so that is naturally a trade-off.

2). After that deduction, you pay the flat rate on EVERYTHING. No having the rich get their accountants to find ways to let them get out of paying income taxes. Today billionaires pay NO income tax by investing in municipal bonds for example -- that kind of thing goes away using my proposed flat tax, just as one example.

(The only complexity is in determining what one's income is -- but at least poor people, with only a simple job and little or no investments would be spared that trouble and expense).

Also - the rich WOULD pay more -- far more. But they wouldn't pay an extortionist rate (IMO). And this should meet (again IMO) any right-winger's incentive to let the wealthy aggressively invest, create jobs, etc. -- since they would get plenty of profit potential from each marginal dollar of their investments - be it $200K or $X-billion.

The losers would be the entire tax preparation industry and lots of lawyers as their services would be largely unneeded. Um, I have trouble conjuring up too many tears over that...
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Voodo Economics

Unread postby Outcast_Searcher » Sun 29 Aug 2010, 19:37:28

$this->bbcode_second_pass_quote('americandream', 'S')orry. Too many if's and buts. The market is either free from the outset and must stand on that basis or its interventionist and fails its own strict test of consistency.


Sorry, but I'm confused. Can you point out specific "if's and buts" you are objecting to? It seems to me we're both saying we want a truly free market, which is of course, libertarian in principle.

My concern is only how we get from here to there in the real world. I don't think you'll EVER get a majority of those in power to completely disassemble the current system today and go to a completely free market tomorrow.

To be clear, I'd be all for a truly free market, but living in the real world, I am stating that some kind of transitional period would be required. (What do you do about Social Security and Medicare recipients, for example -- let all the poor ones die? If so, I don't think you'll get much traction toward a free market in today's world, though Ayn Rand would be a fan).
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Voodo Economics

Unread postby americandream » Sun 29 Aug 2010, 19:51:23

I don't buy the transitional period. It is incumbent on you to be attacking less the interventionists and more the backpeddlers in the free market lobby. Where are the crys of outrage at the unfair subsidisation of investor wealth in the low wages of command control investor golden girl, China?

Where are the cries of outrage in the subsidisation of investor wealth in the vastly costly and commons subsidised infrastructure used by investors. It seems the problem is less with the fact that the commons are having access to their fiscal pool of tax which many have no other choice but to pay into for not being able to afford tax mitigators, its more that tax dodging investors are also gettin an unwarranted access to these resources and aren't being pulled up for it.

The free market is less about the bludging dole recipient be contained and more about investors paying for the whole infrastructure within which they expect us to shop, as consumers of said infrastructure.

Indirect taxation is utterly farcical and transfers some of the subsidising budget burden to the shopping zombie fraternity. There should be no state and no tax, direct or indirect.

As I said, any libertarian worth his salt will be pushing for the elimination of armies, nations and tax codes and the total freeing up of the capitalist global economy, borders and all. Business must be held to account. They cannot expect subsidies whilst deriding the commons. If they do, their free market stance is bogus.

Will that happen. Not likely. The true cost of a pure market would soon kill the dream of allocation by the market and they know it.

Edit: as for medical costs or retirement intitiatives, the pure market would very quickly price down medicine and render these costs minimal in the process reducing profits into the gutter but thats beside the point. Let the market truly compete as in work for every dollar they earn without any handouts, they would soon price themselves off the planet althought the consumer would do fine I'm sure. However, the sheer hidden costs of this horror of greed on steroids as well as the return of Victorian wage rates would very quickly show this for the sham it is. All this transitional excuse making simply delays that fateful day.

I'll say again, agitate for the complete libertarianisation of global capitalism. Make my day. :)
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