Angery people.

STM317 said:

At this point, this thread is just a vehicle for a rich old guy to complain about the world, which is silly. People with 7 figures in assets shouldn't be complaining very loudly about how the world isn't fair.

Rich?  You do remember I earn my living driving a school bus 12+ hours a day don’t you?  That I aspire to make $30,000 a year but have yet to achieve it in spite of volunteering for any evening, weekend, or summer work available.  

I paid $27,800 for my first home ( GI 0 down and even borrowed $50 from the realtor for earnest money) and got all the way up to $107,000 for this one.   

I wear raggedy old clothes and badly worn summer deck shoes year around ( yes in the snow)  because that’s all I own. My idea of dining out is a McDonalds. 

But I care,  I served my country for 2 tours in Vietnam and ran for public office.  I raised my girls to be educated and work hard.  I know America is a wonderful country but it can be better, it will be better if I have my say.  

In reply to frenchyd :

Income does not equal wealth. The median net worth in the US is $46k.  Half of our country has a net worth under that by definition. By your own estimates, you're sitting on an asset that's worth over a million. If you have no other savings or assets, It would still mean you're worth more than 90% of Americans. So yeah, you're rich.

That's nothing to be ashamed of. In fact, you should be proud of what you've accomplished. Amassing that kind of wealth is difficult. Your dad's hard work gave you a great head start, and Your kids have already benefited from your hard work by having their higher education paid for. Leaving them with a valuable asset like your home will only continue that. But it's also the kind of generational passing down of wealth that you've complained about. If you're serious about fighting multi generational wealth, then sell your house, live in the cheapest place you can, and donate the rest to local charities. Otherwise, it's all just talk.

Im not trying to provoke or upset you. You've clearly got a very service minded attitude which is wonderful. The world would likely be a better place if more people were so willing to serve. But I see you complaining about the wealthy passing their wealth down through generations, but you don't seem to realize that you've had advantages because of your parents, and you've already given your kids advantages because of your financial situation. Everybody can build from what their parents achieved. As a parent, you should want your kids to be better off than you were, and you're likely to give them every advantage that you can to insure that. It's pretty normal for people to care more about their own family than they do about society.

Boost_Crazy said:

In reply to frenchyd :

I like those who earn their wealth and power, they are  American!   Good for them!   But the 2-3-4 etc generation of inherited wealth?  Americans died fighting that. 

No, they died fighting for that. Almost every parent wants their kids to be better off than they are. I sure as hell do. I'm not busting my rear and saving my dollars so that I can party the end of my life away. I'm planning to pass a good chunk of wealth down to my kids and grand kids. Will that make them bad people? Would you prefer a "use it or lose it" system where all your assets go to the state when you are gone? What would happen if we were to enact that? You already stated that the real rich (your neighbors) have more money that they could ever spend. I'm sure at least a coupe of them earned it by contributing to society. Let's say all of the talented and successful people quit as soon as they got rich. As soon as they made enough. Movie stars and musicians quit after their first hit. Pro athletes hung it up after their first contract expired. Innovative business people shut it down after they made enough money. Doctors retired after a couple years. Do you think everyone's lives would be better? Do you think the wealth that they didn't take would automatically just be distributed to everyone else? 

What every parent needs to do is teach their children values. Teach them to value education, educate them as well as you can. 

Teach them the value of work and charity teach them about faith and love.  Teach them the limitations and costs of success.  

Then let them fly on their own wings. Let them be who they really want to be. Achieve whatever they can. The eagle pushes the young out of the nest so they can fly on their own. 

Choose your mate wisely so the children see love and sharing learn how to be successful at marriage.

Are you really doing them a favor or cursing them with your wealth?  How will they use it? To buy silly stuff at insane prices simply because they can and others can’t.   

It’s  almost funny how many rich kids get in trouble,shove white powder up their nose, and do risky things trying to punish their parents for being wealthy.   How many parents neglect their children chasing that wealth -  money.  When all the kids really want is love and attention.  

As for the accumulated wealth why not put it back where you got it?  Did you use public roads? Public schools. Was your home protected by public fire and public police?   Were you defended by the military  to succeed as you did?  

In reply to Adrian_Thompson :

Big hole in your argument.  Kids from economically disadvantaged backgrounds get grants and scholarships.  They're not the ones taking on the loans, that's the middle to middle upper class kids.  Those kids should have parents who understand what that loan means and then explain to their kids that maybe they should go to state school and not a 2nd or 3rd tier private school that costs a mint and a half. Or go to community college for the first two years, then transfer to the state college.  Or join ROTC, or go active duty, then get the GI Bill, or, or, or....  There are so many options out there to avoid the debt but people choose not to use them, at that point I don't feel sorry for them.  Take on the debt, pay it back.

I'm torn on higher education for all, for free.  I have the GI Bill myself, I didn't use it, but will be able to let my kids use it.  That's a huge benefit, but was NOT free, I most definitely paid for it!  The #1 issue with free higher education for all is we can't afford it and if we could, people don't want to pay for it.  Then there's the actual administration of it, who gets what to where and for how long? 

In reply to docwyte :

I wish it were that simple that disadvantaged kids could get a free ride with grants and scholarships. That may be true for some or even many, but the sad fact is it’s not true for the majority. Statistics show that the money coming from these sources just isn’t keeping up with the cost of higher education. Look at the PEL grant, it doesn’t pay for much at all these days while it used to cover a huge portion of tuition. Please also see my comments previously that I feel not everyone needs a four year degree and that it’s been pushed on people aiming for professions that may be better served by a shorter technical program but millions have been guided towards an expensive 4 year degree they don’t need, has put them in debt they can’t really afford but it’s made a lot of money for the colleges and loan companies at the expense of the consumer. 

STM317 said:

In reply to frenchyd :

Income does not equal wealth. The median net worth in the US is $46k.  Half of our country has a net worth under that by definition. By your own estimates, you're sitting on an asset that's worth over a million. If you have no other savings or assets, It would still mean you're worth more than 90% of Americans. So yeah, you're rich.

That's nothing to be ashamed of. In fact, you should be proud of what you've accomplished. Amassing that kind of wealth is difficult. Your dad's hard work gave you a great head start, and Your kids have already benefited from your hard work by having their higher education paid for. Leaving them with a valuable asset like your home will only continue that. But it's also the kind of generational passing down of wealth that you've complained about.

No that’s exactly what parents should do.  That’s not passing down money. That’s teaching values.  Educating them. 

Do I have a problem with the fact that the best colleges are mostly filled with legacies and kids who’s parents could afford to make a serious donation  to get them admitted?  Yes!  But I don’t know how to correct that.  Admitting legacies has societal values and a serious donation can improve education for many. 

Yes I wish higher education was more egalitarian and less for the privileged. Perhaps someone smarter than I can figure a solution.

As far as a head start for me and my children, that’s the obligation of a good parent.  Not passing down money.   But it would be nice if children of poor or no parents had the same sort of help.  Welfare sure isn’t the answer,  maybe a mentor program of some sort like big Brother/Sisters?  

ps my father died when I was 24 and in the Navy so I missed much of the guidance  an older parent can  provide for a maturing son. (My mother left at age 5.) 

frenchyd said:

No that’s exactly what parents should do.  That’s not passing down money. That’s teaching values.  Educating them. 

If you say so. I don't see a difference between you paying for your kids' education and some loaded person Cutting a huge check to their alma mater to get their kid's education secured. The price tags might be different, but they're both cases of a parent using their resources to get their kid started on the right foot. Some parents just have more resources than others. Short of communism, there's not really anyway around that. Even in communist countries, you still have the "haves" and the "have nots".

The 2 most expensive things a person will pay for are likely to be a home and higher education. Your kids are likely to get both of those from you. That may not directly be giving them money, but it keeps them from having to pay those massive expenses which is basically the same thing.

In reply to STM317 :

You make a valid point. Every parents wish that their children should have it better then they did versus privileged children  given the power of wealth without the experience or judgment  to use it wisely.

Maybe we should do like in the past?  Leave it up to the parent?  If a parent choose not to protect his money/ wealth then an inheritance tax collects much of it. However a parent can set up such protection.   

Hmmm,   think that would work?   

Sorry if that comes across a little snide.  

In reply to STM317 :

With regard my home?  I’m not sure that will be a blessing or a curse.  Likely there will still be a mortgage on it.  According to actuarial tables I’ve got a little less than 14 years left if all goes well.  Plus maintenance, insurance, and Taxes?   phewww!  

 Both daughters own homes of their own and it’s like every young couple a real slog to make those more modest payments.  

In reply to frenchyd :

Discussion about estate tax is a waste of breath and bandwidth. Do you realize that latest statistics show less than .2% of taxpayers have potential estate tax liability. That statistic was before the estate tax exclusion  was raised to 11 million dollars. Literally less than 5000 estate tax returns had a liability.

In reply to frenchyd :

Ok? So they can sell your home and divide the profit equally. That's no different than you selling it and cutting each daughter a check for their share before you leave us. Unless your mortgage is massive (which I doubt on a bus driver's salary), or you've got a bus load of daughters, they'll each get something in the 6 figure range. If used wisely, That's a very healthy windfall that  can help them tremendously compared to their peers. Maybe it pays off their mortgages, or gets invested where it can grow, or pays for higher Ed for grandkids.

The bottom line is that your accumulated wealth will benefit your heirs. Hopefully, they can take that advantage and grow it to pass down to their heirs, etc etc. You're currently in the top 10% of Americans. If it's not mismanaged, your grand kids could probably be the 1%ers that you complain about.

Duke said:

frenchyd said:

In reply to Ovid_and_Flem :

Clean sheet!  

Ford buys a roll of steel to stamp out doors. They pay 2% 

That hasn’t ever happened before has it?  So this is fresh new income.  

Ford makes a car and sells it to the dealer. 2% 

that hasn’t happened before

the dealer sell the car 2%. 

That hasnt happened before. 

You buy a $100 lawn mower from your neighbor. 2%. 

That hasnt happened before. 

And so on and so on. 

People will pay 2 cents on the dollar because it’s trivial  and the punishment for not paying it is severe

it’s easy to track since so much is electronic.

Even the cash society will pay 2% because it’s trivial and the risk of punishment  remains the same.  

By the way  I didn’t start at the beginning. 

Maybe I should have talked about taconite or the cost of the diesel fuel.  Everything  purchased at wholesale in the past collects 2%. 

This is called Value Added Tax and it has been around for maybe 100 years. It’s really really super not a good idea. If you’re taxing every transaction that makes up a car at 2%, you just raised the price of that car by at least 100%. 

I think people will notice that. 

Not quite a VAT tax.With a VAT tax your receipts are offset from your expenses. For example if GM bought a engine block they would pay 2% on that. Once they sell the car they would collect 2% from the buyer. If they sold everything at cost it would net to 0. In reality there would be a markup on the car they sold and so the 2% "charge" would be on that markup. It's similar to a sales tax but it shifts the burden from the end user to everyone along the supply chain. It lets governments collect as the process moves along and prevents people from avoiding sales taxes if the product gets exported. 

frenchyd said:

In reply to Driven5 :

Given your agreement can you create a fair income tax?  

Here’s my attempt.  

Eliminate income tax on anyone earning less than $50,000 ( (adjust for inflation)  married could earn $100,000. 

Above $50,000 one flat rate.  Let’s say 10% for simplicity.  (And this from a progressive). No deductions.   Paid 24 hours after receipt.  

Eliminate corporate taxes,   eliminate Capitol gains tax,  eliminate alternative minimum tax.  

In place of those add a national sales tax to everything.   Everything, no exception! None!  Religious, resale,  speculation, gambling, everything.  Due 24 hours after sale.  Penalty for not paying the tax remains the same.  Even in the cash society how many people would risk those penalties for 2%  so collection would improve dramatically.  Keep it a nominal percent and few would evade.  

Your kid buys a bubble gum 2% is added to the cost. You buy General Electric stock 2%  ( per share)   Company 2% General Electric buys a roll of wire 2% 

Here’s the Brilliant part of this. 1/2 of any car made in AMERICA  is imported.  Let’s say a Finnish made Air bag  cost $70 to make plus $30 profit =$100  plus freight $5 + import duty  $10 + 2% sales tax  $2.30   For a total of $117.30  

 Average car has 7 air bags   GM will sell  2 million cars in our fictional year.  That’s $329  extra profit per car  if made in a GM plant instead of bought from Finland or Japan  

$658 million more dollars per year!!  I think they could build a plant here in the US and still make a profit!!! 

Think of all all the jobs that would bring back to America!   

 

This would be pretty regressive and shift more tax to the poor. The rich would love this or the flat tax idea.

Can you clarify the US airbag example? I'm not sure I follow what you mean here.

frenchyd said:

Ovid_and_Flem said:

In reply to frenchyd :

I've actually reviewed some scholastic articles for a national sales tax to replace income tax and most pundits suggest it would have to be between 22% up to 45% to be revenue neutral.  So your 2% appears to be Farrrrr too low.

Every one I’ve seen does not include every purchase. Especially purchases of stocks and bonds.  Just how many shares worth how much are traded per yearOne other nice  benefit would be the elimination of  extra rapid trading artificially changing stock prices. 

In addition those I’ve seen assume some sort of adherence  to a  tax code. ie no wholesale income. 

Again, the rich would be 100000% on board with this. Could you imagine paying 2% on an index fund and then 30 years from now when you retire you can sell those funds tax free? Sure beats the 15-39.6% you would pay now.!

frenchyd said:

In reply to Boost_Crazy :

OK I didn’t live up to my fathers achievements. Not only that but I’m probably the poorest person on the lake. 

But I live where I want to and in a house I built with my own two hands, the way I wanted it. 

Rich, poor?  I don’t know. I do know that the rich are now no different than the king and nobles we fought for our independence from. 

Inherited wealth is why we fought. The Kings riches and power came from his father and his father and his father before him. 

I like those who earn their wealth and power, they are  American!   Good for them!   But the 2-3-4 etc generation of inherited wealth?  Americans died fighting that. 

Just because you're the poorest person in your neighborhood doesnt make you poor. I could be a the poorest person living in Monte Carlo and still be a 1%. You may not realize how rich you actually are compared to the rest of the country.

You people should quit yammering on internet forums and get back to work!

docwyte said:

In reply to Adrian_Thompson :

Big hole in your argument.  Kids from economically disadvantaged backgrounds get grants and scholarships.  They're not the ones taking on the loans, that's the middle to middle upper class kids.  Those kids should have parents who understand what that loan means and then explain to their kids that maybe they should go to state school and not a 2nd or 3rd tier private school that costs a mint and a half. Or go to community college for the first two years, then transfer to the state college.  Or join ROTC, or go active duty, then get the GI Bill, or, or, or....  There are so many options out there to avoid the debt but people choose not to use them, at that point I don't feel sorry for them.  Take on the debt, pay it back.

I'm torn on higher education for all, for free.  I have the GI Bill myself, I didn't use it, but will be able to let my kids use it.  That's a huge benefit, but was NOT free, I most definitely paid for it!  The #1 issue with free higher education for all is we can't afford it and if we could, people don't want to pay for it.  Then there's the actual administration of it, who gets what to where and for how long? 

I too got the GI bill.  It paid for my 2nd college degree but to use it I had to attend a community college  in the evenings.  My day started at 4:00am and it was full throttle from then until 6:00pm race across town to come in after class started and stay until 9:00pm. Drive home and if I was real lucky climb into bed around 10:00pm  the alarm went off at 3:00am to get me to work by 4:00. 

Darn right it was hard. But education is the magic bullet.  

Now education doesn’t mean college. Trade school or OJT, or military service. 

As far as who pays for it?  Easy, we all do.  The numbers tell the story. The more education a person has the more money they make and the more taxes they pay.  The return on investment is over 7-1. For every dollar of tax payer money the government gets back 7 in taxes.  Any investor would fall in love with that sort of rate of return. 

In reply to Enyar :

I don’t believe I’ve complained. As I said I love where I live I’m content in a home I’ve built with my own two hands. It’s a dream come true for me.  

ps I love paying taxes!  The more money I make the more taxes I pay.  I’d love to pay millions of dollars in taxes because think of how rich I’d be then!  

Incidentally. The state’s that pay the most taxes have the highest wages too!  The state’s with the lowest tax rate or no income tax make the least wages. 

Enyar said:

Can you clarify the US airbag example? I'm not sure I follow what you mean here.

He's saying that he actually believes that manufacturers could already be saving $45 per piece by making the parts in-house, but are choosing not to do so because there isn't $2 of sales tax on it...Then he's giving credit for the full $47 of potential savings to the 2% sales tax, instead of the actual savings of $2. 

Enyar said:

frenchyd said:

Ovid_and_Flem said:

In reply to frenchyd :

I've actually reviewed some scholastic articles for a national sales tax to replace income tax and most pundits suggest it would have to be between 22% up to 45% to be revenue neutral.  So your 2% appears to be Farrrrr too low.

Every one I’ve seen does not include every purchase. Especially purchases of stocks and bonds.  Just how many shares worth how much are traded per yearOne other nice  benefit would be the elimination of  extra rapid trading artificially changing stock prices. 

In addition those I’ve seen assume some sort of adherence  to a  tax code. ie no wholesale income. 

Again, the rich would be 100000% on board with this. Could you imagine paying 2% on an index fund and then 30 years from now when you retire you can sell those funds tax free? Sure beats the 15-39.6% you would pay now.!

The house ( at gambling casinos )always takes their cut up front.  

The government would still win that way! Imagine how much income the government would get when the holders of those index funds start buying. 2% may not seem like much but when it’s 2% on every sale it really adds up. 

In reply to frenchyd :

I know you've been talkin in the bigger picture view of our tax system. And knowing your age I'm sure that your bus driving gig isn't your only source of income. Plus I know you're something of an entrepreneur with your auto restoration talents. Just curious. What portion of your income do you feel comfortable paying compared to what you're paying under the present system? Not trying to get into your private business but just curious of the inequity you see.

Enyar said:

frenchyd said:

In reply to Driven5 :

Given your agreement can you create a fair income tax?  

Here’s my attempt.  

Eliminate income tax on anyone earning less than $50,000 ( (adjust for inflation)  married could earn $100,000. 

Above $50,000 one flat rate.  Let’s say 10% for simplicity.  (And this from a progressive). No deductions.   Paid 24 hours after receipt.  

Eliminate corporate taxes,   eliminate Capitol gains tax,  eliminate alternative minimum tax.  

In place of those add a national sales tax to everything.   Everything, no exception! None!  Religious, resale,  speculation, gambling, everything.  Due 24 hours after sale.  Penalty for not paying the tax remains the same.  Even in the cash society how many people would risk those penalties for 2%  so collection would improve dramatically.  Keep it a nominal percent and few would evade.  

Your kid buys a bubble gum 2% is added to the cost. You buy General Electric stock 2%  ( per share)   Company 2% General Electric buys a roll of wire 2% 

Here’s the Brilliant part of this. 1/2 of any car made in AMERICA  is imported.  Let’s say a Finnish made Air bag  cost $70 to make plus $30 profit =$100  plus freight $5 + import duty  $10 + 2% sales tax  $2.30   For a total of $117.30  

 Average car has 7 air bags   GM will sell  2 million cars in our fictional year.  That’s $329  extra profit per car  if made in a GM plant instead of bought from Finland or Japan  

$658 million more dollars per year!!  I think they could build a plant here in the US and still make a profit!!! 

Think of all all the jobs that would bring back to America!   

 

This would be pretty regressive and shift more tax to the poor. The rich would love this or the flat tax idea.

 

Can you clarify the US airbag example? I'm not sure I follow what you mean here.

Just because a tax is progressive doesn’t mean it is pain free for the poor.  Plus the flexibility of a tax like this.  The poor can buy seeds and pay the 2% on the seeds. Grow food and avoid the tax on groceries.  If you don’t want to pay any tax, simply don’t buy anything. 

Foriegn made goods are not currently taxed except for import duty and then they are taxed at an agreed upon rate.  By adding a sales tax to the total price of something you put  a real incentive to make it here in America rather than import it.  

If say General Motors buys things to put in their cars they simply add the desired profit and purchase price  to the cost of the car.  That way they avoid the cost of a factory and hiring people. 

On the other hand if they made things here under this system they would have hundreds of millions of dollars of reason to make that investment rather than buying.  

I mentioned only one thing out of the thousands of parts in a car made and sold here in America.  One thing, of one company,  times all the stuff sold in America!  

Every company would build factories here rather than buy there.  Increasing  the demand for labor and thus the cost of labor.  

In short people would make more money. If you have more money does it matter if the tax is progressive or not? More is more!! 

frenchyd said:

Enyar said:

frenchyd said:

Ovid_and_Flem said:

In reply to frenchyd :

I've actually reviewed some scholastic articles for a national sales tax to replace income tax and most pundits suggest it would have to be between 22% up to 45% to be revenue neutral.  So your 2% appears to be Farrrrr too low.

Every one I’ve seen does not include every purchase. Especially purchases of stocks and bonds.  Just how many shares worth how much are traded per yearOne other nice  benefit would be the elimination of  extra rapid trading artificially changing stock prices. 

In addition those I’ve seen assume some sort of adherence  to a  tax code. ie no wholesale income. 

Again, the rich would be 100000% on board with this. Could you imagine paying 2% on an index fund and then 30 years from now when you retire you can sell those funds tax free? Sure beats the 15-39.6% you would pay now.!

The house ( at gambling casinos )always takes their cut up front.  

The government would still win that way! Imagine how much income the government would get when the holders of those index funds start buying. 2% may not seem like much but when it’s 2% on every sale it really adds up. 

Right but they would be missing the 15-39.6% at the end of the year or even later. No way the government takes that deal.

In reply to frenchyd :

The poor don't have the time or the space to start a farm. Think of your example. There is currently no fed sales tax on seeds and I don't see the poor lining up to be farmers now. What makes you think it would be different if they had to pay more? They can't simply not pay rent, food, shelter etc. Meanwhile the rich would be laughing all the way to the bank with their measly 2% sales tax and 10% fed income tax.

Your comment on foreign made goods not being taxed is simply not true. You're telling me GM isn't paying tax on a car they manufacture in Mexico and sell in the US? Not only is GM taxed on that but shareholders are taxed again on their share of that income.And even then, why would there be an incentive, aren't they paying the 2% if they are buying parts in the US? If anything increasing transaction costs here is gonna push for more imports.

Enyar said:

Duke said:

frenchyd said:

In reply to Ovid_and_Flem :

They pay 2% 

That hasn’t ever happened before has it?  So this is fresh new income. 2% 

that hasn’t happened before 2%. 

That hasnt happened before. 2%. 

That hasnt happened before. 

And so on and so on. 

People will pay 2 cents on the dollar because it’s trivial  and the punishment for not paying it is severe

This is called Value Added Tax and it has been around for maybe 100 years. It’s really really super not a good idea. If you’re taxing every transaction that makes up a car at 2%, you just raised the price of that car by at least 100%.

Not quite a VAT tax.  It's similar to a sales tax but it shifts the burden from the end user to everyone along the supply chain. It lets governments collect as the process moves along and prevents people from avoiding sales taxes if the product gets exported. 

How on earth does it shift the burden from the end user to the everyone on the supply chain?  Because you know, I know, and undiscovered tribes in the blackest depths of the Amazon jungle know that each step is just going to increase their prices as required to offset the tax.  Which all flows downhill to the consumer.  ALL taxes are eventually paid by the consumer.  Always.