The Democrats have been somehow less responsible as they've not been in control of the agenda over the last 48 years (Since LBJ left).
You're completely nuts and have no comprehension of American politics. It took quite a bit of effort for that to be the strongest thing I have to say about that statement. Don't press it, please. Just know that you're wrong.
Obama had the global mess for the first 2 years (when he could have done something)
No comprehension whatsoever.
Getting the GOP wiped out (like in1964) would be a chance to truly change thing for the better.
Funny how that's treason if you replace 'GOP' with the name of a Canadian party…
And this is coming from someone who knows that most of the establishment needs to be executed for treason.
Getting at least to a more balanced taxation would be the first step
I like a flat 10% tax. Problem solved.
"But that won't pay for the budget!"
Then gut the motherfucker. Problem solved. It's not like our economy is founded on money. It's all currency.
Wrong. The rich on the average, pays more of a percent of their income than the bottom 80%. Using "effective tax rate" also is deceiving as many of the rich donate a lot of money to charity and thus lowering their effective tax rate. The rich also pays a higher percent of tax, compare to their total income earned. The top 10% account for 45% of the gross income but pays about 70% of the taxes. The bottom 50% only account for 11% of the gross income but pays only 2.5% of the taxes collected.
Federal income tax is not the only tax paid by citizens of the United States. You also have state and local taxes, which are (surprise!) not as progressive as federal income taxes. People who are wealthy pay a lower percentage of their income in state and local taxes in EVERY state in the U.S. For example, the "no state income tax" states like Texas and Florida rely heavily on regressive tax policies like sales tax and excise tax that are a greater burden on citizens in the lower income brackets to make up for it.
"CTJ shows that combined local, state and federal taxes produce a system that more resembles a flat tax than a progressive tax: In 2015, the top 1% will pay 32.6% of their income in taxes, while those in the 60th-80th percentile (with average income of $81,000) pay 30.4% and the next highest 10% (average income of $125,000) pay 32.1%. Overall, the bottom 99% pay 29.8% of their income in taxes, a ratio not much smaller than the top 1%." --from the above link
Not even close to every State. In CA, there is no separate capital gains tax. All capital gain is added to regular income and taxed at full marginal rate. But SS income is not taxed in CA and only 13 States taxes SS. In CA, the top 10% pays 80% of the State income taxes. That's pretty progressive to me.
The problem with adding sales tax into the picture is that one has to spend their money on taxable items in order to pay it. Of course, the lower one's income, the more percentage of their income goes to paying sales tax as they would have to spend more of their income to live on. The higher your income, the more income you can save and thus not pay any sales tax on it. If the high income earners were to spend most of their money (on taxable itms), sales tax would no longer look regressive as they would be paying the same percentage (or more) of their income in sale tax as the low income earners. It could be more because non taxable food items would be a lower percentage of their income, so the high income earner would be spending more money on taxable items.
Should we start making the rich pay more in sales tax for the same item the lower income earners buys? In other words, the tax on a flat screen TV would be 15% for the rich and only 5% for the poor? What's going to happen is the rich will have a poor person buy the TV for them and then hand them a small percentage of their sales tax savings. And thus ending up paying less in sales tax than they would be paying now. Sales tax is a consumption tax and should be the same for all consumers, regardless if you're poor or rich. Now there is a luxury that that usually the rich has to pay for certain luxury items, but the poor would have to pay the same luxury tax if they were to save up and buy the same item.
And notice that property tax in not included because that would favor the higher income earners. Wouldn't want to do that in a report that wants to make it appear that the poor pays as much of their income in taxes as the rich, as the rich would be more likely to own own property and pay taxes on it. But property tax is just as much as a tax as sales tax. Tell the property owners in San Francisco that the $12,000 a year they have to pay in property tax, for their recently bought $1M plus home, is some how, not a tax.
The Democrats have been somehow less responsible as they've not been in control of the agenda over the last 48 years (Since LBJ left).
You're completely nuts and have no comprehension of American politics. It took quite a bit of effort for that to be the strongest thing I have to say about that statement. Don't press it, please. Just know that you're wrong. No comprehension whatsoever.Funny how that's treason if you replace 'GOP' with the name of a Canadian party…
And this is coming from someone who knows that most of the establishment needs to be executed for treason. I like a flat 10% tax. Problem solved.
"But that won't pay for the budget!"
Then gut the motherfucker. Problem solved. It's not like our economy is founded on money. It's all currency.
A 10% tax would reduce the US to a bystander on the world stage and destroy the us middle classes.
"fund the transport infrastructure needed to deal with congestion created by the company, as well as other businesses in the area"
This should have been thought through when the Spaceship was proposed. Either they didn't think it through, or whatever they planned is now felt to be inadequate. Someone has to pay for roads, & bridges, & public transportation, etc.
I suspect there is a large voter block who see Apple and the other big companies as cash cows to be milked for all they can get. Why should I, Little Old Lady Jane Citizen, pay taxes when corporate giant Apple is sitting right there? Pandering to those voters could be a profitable political play for the Mayor.
The problem is not the Apple campus, it's the numerous office towers that developers are planning to build to profit by offering space in close proximity to the new Apple campus that are putting the strain on the infrastructure and budget. Basically this "Mayor" has sided with developers and is attempting to guilt Apple into footing the bill to make these projects cost less for out of area/state developers that will not operate a business in Cupertino once the buildings are built and sold/leased to businesses. The citizens of Cupertino are mostly aware of this. Taking this issue to the nation/international stage will do very little for the mayor's efforts.
The irony is the city council grilled Apple extensively about its plans to redevelop the old HP campus that was mostly abandoned, while rubber stamping commercial development projects throughout the area that will effectively employee 10 times as many workers.
You're being generous. sog35 is beyond insane, and beyond help. His endless, mindless, non-sensical, hysterical ramblings full of such ego and misplaced confidence are beyond pitiful. Sog35 pretends to hold SJ on a high pedestal and consistently (and moronically) compares Cook to him, while at the same time completely shitting on SJ, by stating over and over that TC is "lucky" to be given a position by SJ that he "didn't earn at all". sog35 is too moronic to understand his own contradictions and hypocrisy. It's true what they say, that fools are the most confident about everything they say. He claims it's another "bone-headed" move by Cook to keep the new Campus in CA (even though it's been planned for a decade and SJ presented the idea just 5 years ago). He suggests Austin, as if this is some brilliant idea he just came up with, that was never considered internally by Apple, and claims it would "obviously" be a superior choice, something that is utterly and completely baseless.
What about relocating the many THOUSANDS of employees that work at Apple HQ and their families to another state, instead of across the street, and the MASSIVE burden that would entail- financially, logistically, and in a way that rips them from their communities and can affect their lives, productivity, and mental health in a negative way? Sog35 doesn't take more than 2 seconds to come up with his proclamations, so he doesn't get to (non) details like this. Obviously, Tim cook should have ripped up Apple's legacy, and spit on SJ's vision about the campus- to sog35, that is the only correct route, because he woke up this morning believing it.
Sog35 should sell his fucking stock so he can spare everyone is insufferably asinine word-vomit that has become so predictable in it's spam like qualities. He's an intellectual midget that makes himself feel better by shitting on people who are infinitely more intelligent, capable, and successful than him- like Tim Cook.
So much hate. So much hate.
But they say love and hate is the closest two emotions.
It may look like I 'hate' Cook. I don't. He is an excellent COO. The best in the world. Jobs knew that too. And Cook has done an excellent job at growing the company hardware production the last 5 years. But we won't be seeing massive hardware growth anymore. What is needed is a CEO who knows innovation and vision. Sorry but Cook does not have that. Jobs picked Cook because he knew the iPhone had so much growth left in it. But now that growth is almost all tapped out. The next 5 years we will probably see about 5% unit growth per year.
Companies go in stages. Rarely do you have a CEO who lasts decades who was not a founder. This is time for a new stage of Apple. A new CEO. Apple has reached the absolute PINNACLE of hardware mastery. But now is a new stage. Software. Services. And Cook isn't the man for the job. Sorry.
Stage 1: pre- 2011 - Growth and Innovation - Steve Jobs - perfect CEO for that era
Stage 2: Expansion 2011-2016 - Tim Cook. Perfect CEO to expand hardware to new markets and maximize the supply chain
Stage 3: Monetization of user base - 2016-??? - We need a new CEO to lead this new era. We need a CEO who is an expert on services. Cloud. Artificial Intellgence. Big Data. Advertising. Payments. Banking. Leasing. Insurance. Media. Social Platforms. Sorry Cook isn't the man.
Apple has grown the user base to over 1 Billion. In 10 years that user base will hit close to 2 Billion. Apple needs to start building its services NOW.
Tim Cook is not an expert on services. We need a CEO who is. The new CEO should stop the dividend and buyback. He should spend every cent on building world class services. He should pledge $250 billion for the next 5 years on services. He should use foreign cash to buy foreign services companies. That way there would be no taxes being paid.
Apple will continue to innovate on hardware. But lets face it. The smartphone has pretty much peaked. Its obvious that upgrade cycles will slow down. Services need to replace iPhone revenue. I would concentrate on these services first:
1. iCloud. Invest $30 billion to be the best cloud in the world 2. Adverstising Platform. No more excuses. Buy up Yahoo and DuckDuck Go if you must. Spend $100 billion. 3. Social Platforms. Buy Twitter. Buy dozens of small social platforms. Invest $30 billion. 4. Artificial Intellegence. Open up customer data. Hire the best. Improve Siri. Invest $30 billion.
Drop the car program immediately. Apple does not need to get into a risky car program.
I think you're right about the car. And the repurchases.
asdasd said: A 10% tax would reduce the US to a bystander on the world stage and destroy the us middle classes.
How the hell would universally lowering taxes do that? The income tax shouldn't exist. Property taxes shouldn't exist. The government should fund itself through tariffs like it used to.
asdasd said: A 10% tax would reduce the US to a bystander on the world stage and destroy the us middle classes.
How the hell would universally lowering taxes do that? The income tax shouldn't exist. Property taxes shouldn't exist. The government should fund itself through tariffs like it used to.
asdasd said: A 10% tax would reduce the US to a bystander on the world stage and destroy the us middle classes.
How the hell would universally lowering taxes do that? The income tax shouldn't exist. Property taxes shouldn't exist. The government should fund itself through tariffs like it used to.
So, again, gut the fucking budget. Government expenditure used to be 10% of GDP. Now it’s 50%. Government used to be funded on tariffs and sales tax. Now it’s not funded at all in the slightest and our incomes are stolen from us, our land is stolen from us, and our futures are stolen from us.
They don’t have to spend what they spend. And when they don’t, they don’t have to tax what they tax.
You're being generous. sog35 is beyond insane, and beyond help. His endless, mindless, non-sensical, hysterical ramblings full of such ego and misplaced confidence are beyond pitiful. Sog35 pretends to hold SJ on a high pedestal and consistently (and moronically) compares Cook to him, while at the same time completely shitting on SJ, by stating over and over that TC is "lucky" to be given a position by SJ that he "didn't earn at all". sog35 is too moronic to understand his own contradictions and hypocrisy. It's true what they say, that fools are the most confident about everything they say. He claims it's another "bone-headed" move by Cook to keep the new Campus in CA (even though it's been planned for a decade and SJ presented the idea just 5 years ago). He suggests Austin, as if this is some brilliant idea he just came up with, that was never considered internally by Apple, and claims it would "obviously" be a superior choice, something that is utterly and completely baseless.
What about relocating the many THOUSANDS of employees that work at Apple HQ and their families to another state, instead of across the street, and the MASSIVE burden that would entail- financially, logistically, and in a way that rips them from their communities and can affect their lives, productivity, and mental health in a negative way? Sog35 doesn't take more than 2 seconds to come up with his proclamations, so he doesn't get to (non) details like this. Obviously, Tim cook should have ripped up Apple's legacy, and spit on SJ's vision about the campus- to sog35, that is the only correct route, because he woke up this morning believing it.
Sog35 should sell his fucking stock so he can spare everyone is insufferably asinine word-vomit that has become so predictable in it's spam like qualities. He's an intellectual midget that makes himself feel better by shitting on people who are infinitely more intelligent, capable, and successful than him- like Tim Cook.
So much hate. So much hate.
But they say love and hate is the closest two emotions.
It may look like I 'hate' Cook. I don't. He is an excellent COO. The best in the world. Jobs knew that too. And Cook has done an excellent job at growing the company hardware production the last 5 years. But we won't be seeing massive hardware growth anymore. What is needed is a CEO who knows innovation and vision. Sorry but Cook does not have that. Jobs picked Cook because he knew the iPhone had so much growth left in it. But now that growth is almost all tapped out. The next 5 years we will probably see about 5% unit growth per year.
Companies go in stages. Rarely do you have a CEO who lasts decades who was not a founder. This is time for a new stage of Apple. A new CEO. Apple has reached the absolute PINNACLE of hardware mastery. But now is a new stage. Software. Services. And Cook isn't the man for the job. Sorry.
Stage 1: pre- 2011 - Growth and Innovation - Steve Jobs - perfect CEO for that era
Stage 2: Expansion 2011-2016 - Tim Cook. Perfect CEO to expand hardware to new markets and maximize the supply chain
Stage 3: Monetization of user base - 2016-??? - We need a new CEO to lead this new era. We need a CEO who is an expert on services. Cloud. Artificial Intellgence. Big Data. Advertising. Payments. Banking. Leasing. Insurance. Media. Social Platforms. Sorry Cook isn't the man.
Apple has grown the user base to over 1 Billion. In 10 years that user base will hit close to 2 Billion. Apple needs to start building its services NOW.
Tim Cook is not an expert on services. We need a CEO who is. The new CEO should stop the dividend and buyback. He should spend every cent on building world class services. He should pledge $250 billion for the next 5 years on services. He should use foreign cash to buy foreign services companies. That way there would be no taxes being paid.
Apple will continue to innovate on hardware. But lets face it. The smartphone has pretty much peaked. Its obvious that upgrade cycles will slow down. Services need to replace iPhone revenue. I would concentrate on these services first:
1. iCloud. Invest $30 billion to be the best cloud in the world 2. Adverstising Platform. No more excuses. Buy up Yahoo and DuckDuck Go if you must. Spend $100 billion. 3. Social Platforms. Buy Twitter. Buy dozens of small social platforms. Invest $30 billion. 4. Artificial Intellegence. Open up customer data. Hire the best. Improve Siri. Invest $30 billion.
Drop the car program immediately. Apple does not need to get into a risky car program.
You know, the only difference between AI forum comments and the elementary school playground is when people post thoughtful criticism and ideas for Apple and its role in human culture. Sog is thinking and being honest! Is it BS? Look around you and in the mirror and you'll see that 85% of what everyone says is dumb BS. If it weren't, then we'd be living in Utopia right now, instead of congratulating ourselves.
Let's stop criticizing Sog and offer thoughtful, concise ideas of our own, shall we? I get the feeling some of you haters don't have the intelligence to spar with Sog, so you default to infantile put downs. I know that works for Trump, but let's be ruled by the best ideas here at AI. Otherwise we're just wasting our breath.
As I said in my post yesterday, the next market paradigm is AI. Sog, the car is AI, so you see the contradiction in your above post, right? Soon, it'll all be AI, so how do we get Apple to the peak of the next macro computer paradigm?
Okay smarties, answer that question! Amaze Sog and me with your insights! Booyah
This argument is little different than the argument that the rich in general don't pay enough taxes, when in reality the richest 10% pay the majority of federal income tax...in fact the bottom 50% of earners pay almost no federal tax at all.
The rich also take in 90% of the financial gains over the last 2 decades and actually end up paying a lower effective tax rate than most citizens. And the comment that 50% pay no federal tax is crap. Unless you are making close to minimum wage, you are paying federal taxes. If you are you are in extreme poverty and can barely afford to eat and have shelter.
Uh, sorry genius, you're wrong. 48% pay NO federal income tax. It's a fact.
This argument is little different than the argument that the rich in general don't pay enough taxes, when in reality the richest 10% pay the majority of federal income tax...in fact the bottom 50% of earners pay almost no federal tax at all.
Wait so you're saying children, elderly, military service, disabled and people in poverty should pay taxes now? Also where did you get that number?
This argument is little different than the argument that the rich in general don't pay enough taxes, when in reality the richest 10% pay the majority of federal income tax...in fact the bottom 50% of earners pay almost no federal tax at all.
Wait so you're saying children, elderly, military service, disabled and people in poverty should pay taxes now? Also where did you get that number?
No one is saying that low income earners should have to pay taxes. What most are saying is that our tax system already favors the low income earners and puts the burden on the high income earners. The bottom 50% pays less that 3% of the fed income tax collected while earning 11.5% of the total gross income.In fact, the bottom 25% actually gets paid because of tax credits they receive. The top 1% pays about 40% of the fed income tax collected while earning 20% of the total gross income. And the top 10% earns about 46% of the total gross income and pays about 70% of the taxes collected. And 70% would be considered a "majority" of the taxes.
This is not about the bottom 50% hardly paying any income taxes but about the 10% already paying their fair share. Which by all account they are. However, liberals like to keep moving the goal post as to what 'fair" means and will throw in other statistic and numbers to make it seems as though the top 10% paying nearly 70% of the income tax collect is not "fair" at all. With liberals, it's not about how much income taxes the rich pays, but how much of their income they get to keep. And to them, it's not fair that they get to keep so much of it.
If you can't understand this maybe this will help ……
This is a VERY simple way to understand the tax laws. Read on — it does make you think!!
Let's put tax cuts in terms everyone can understand. Suppose that every day, ten men go out for dinner. 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 $7, the eighth $12, the ninth $18, and the tenth man — the richest — would pay $59.
That's what they decided to do. The ten men ate dinner in the restaurant every day and seemed quite happy with the arrangement — until one day, the owner threw them a curve (in tax language a tax cut).
"Since you are all such good customers," he said, "I'm going to reduce the cost of your daily meal by $20." So now dinner for the ten only cost $80.00.
The group still wanted to pay their bill the way we pay our taxes. So the first four men were unaffected. They would still eat for free. But what about the other six — the paying customers? How could they divvy up the $20 windfall so that everyone would get his "fair share?"
The six men 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 end up being PAID to eat their meal. So the restaurant 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 paid nothing, the sixth pitched in $2, the seventh paid $5, the eighth paid $9, the ninth paid $12, leaving the tenth man with a bill of $52 instead of his earlier $59. Each of the six was better off than before. And the first four continued to eat 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 who pointed to the tenth. "But he got $7!"
"Yeah, that's right," exclaimed the fifth man, "I only saved a dollar, too ... It's unfair that he got seven times more than me!".
"That's true!" shouted the seventh man, "why should he get $7 back when I got only $2? 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 he didn't show up for dinner, so the nine sat down and ate without him. But when it came time to pay the bill, they discovered, a little late what was very important. They were FIFTY-TWO DOLLARS short of paying the bill! Imagine that!
And that, boys and girls, journalists and college instructors, is how the 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 at the table anymore.
Where would that leave the rest? Unfortunately, most taxing authorities anywhere cannot seem to grasp this rather straightforward logic!
T. Davies Professor of Accounting & Chair, Division of Accounting and Business Law The University of South Dakota School of Business 414 E. Clark Street Vermillion, SD 57069 Phone: 605-677-5230 Fax: 605-677-5427
Comments
No comprehension whatsoever.Funny how that's treason if you replace 'GOP' with the name of a Canadian party…
And this is coming from someone who knows that most of the establishment needs to be executed for treason.
I like a flat 10% tax. Problem solved.
"But that won't pay for the budget!"
Then gut the motherfucker. Problem solved. It's not like our economy is founded on money. It's all currency.
And here' another 10 States where your are wrong.
http://www.areavibes.com/library/states-with-lowest-income-and-tax/ ;
The problem with adding sales tax into the picture is that one has to spend their money on taxable items in order to pay it. Of course, the lower one's income, the more percentage of their income goes to paying sales tax as they would have to spend more of their income to live on. The higher your income, the more income you can save and thus not pay any sales tax on it. If the high income earners were to spend most of their money (on taxable itms), sales tax would no longer look regressive as they would be paying the same percentage (or more) of their income in sale tax as the low income earners. It could be more because non taxable food items would be a lower percentage of their income, so the high income earner would be spending more money on taxable items.
Should we start making the rich pay more in sales tax for the same item the lower income earners buys? In other words, the tax on a flat screen TV would be 15% for the rich and only 5% for the poor? What's going to happen is the rich will have a poor person buy the TV for them and then hand them a small percentage of their sales tax savings. And thus ending up paying less in sales tax than they would be paying now. Sales tax is a consumption tax and should be the same for all consumers, regardless if you're poor or rich. Now there is a luxury that that usually the rich has to pay for certain luxury items, but the poor would have to pay the same luxury tax if they were to save up and buy the same item.
And notice that property tax in not included because that would favor the higher income earners. Wouldn't want to do that in a report that wants to make it appear that the poor pays as much of their income in taxes as the rich, as the rich would be more likely to own own property and pay taxes on it. But property tax is just as much as a tax as sales tax. Tell the property owners in San Francisco that the $12,000 a year they have to pay in property tax, for their recently bought $1M plus home, is some how, not a tax.
The irony is the city council grilled Apple extensively about its plans to redevelop the old HP campus that was mostly abandoned, while rubber stamping commercial development projects throughout the area that will effectively employee 10 times as many workers.
They don’t have to spend what they spend. And when they don’t, they don’t have to tax what they tax.
Ah, but it’s not unconstitutional.
Let's stop criticizing Sog and offer thoughtful, concise ideas of our own, shall we? I get the feeling some of you haters don't have the intelligence to spar with Sog, so you default to infantile put downs. I know that works for Trump, but let's be ruled by the best ideas here at AI. Otherwise we're just wasting our breath.
As I said in my post yesterday, the next market paradigm is AI. Sog, the car is AI, so you see the contradiction in your above post, right? Soon, it'll all be AI, so how do we get Apple to the peak of the next macro computer paradigm?
Okay smarties, answer that question! Amaze Sog and me with your insights! Booyah
From here for one.
http://www.ntu.org/foundation/page/who-pays-income-taxes
http://www.aei.org/publication/irs-data-the-top-1-pay-37-of-all-taxes-the-bottom-half-pay-2-a-blubbering-david-letterman-cant-believe-the-facts/
No one is saying that low income earners should have to pay taxes. What most are saying is that our tax system already favors the low income earners and puts the burden on the high income earners. The bottom 50% pays less that 3% of the fed income tax collected while earning 11.5% of the total gross income.In fact, the bottom 25% actually gets paid because of tax credits they receive. The top 1% pays about 40% of the fed income tax collected while earning 20% of the total gross income. And the top 10% earns about 46% of the total gross income and pays about 70% of the taxes collected. And 70% would be considered a "majority" of the taxes.
This is not about the bottom 50% hardly paying any income taxes but about the 10% already paying their fair share. Which by all account they are. However, liberals like to keep moving the goal post as to what 'fair" means and will throw in other statistic and numbers to make it seems as though the top 10% paying nearly 70% of the income tax collect is not "fair" at all. With liberals, it's not about how much income taxes the rich pays, but how much of their income they get to keep. And to them, it's not fair that they get to keep so much of it.
If you can't understand this maybe this will help ……
from ……… http://www.snopes.com/business/taxes/howtaxes.asp
How Taxes Work . . .
This is a VERY simple way to understand the tax laws. Read on — it does make you think!!
Let's put tax cuts in terms everyone can understand. Suppose that every day, ten men go out for dinner. 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 $7, the eighth $12, the ninth $18, and the tenth man — the richest — would pay $59.
That's what they decided to do. The ten men ate dinner in the restaurant every day and seemed quite happy with the arrangement — until one day, the owner threw them a curve (in tax language a tax cut).
"Since you are all such good customers," he said, "I'm going to reduce the cost of your daily meal by $20." So now dinner for the ten only cost $80.00.
The group still wanted to pay their bill the way we pay our taxes. So the first four men were unaffected. They would still eat for free. But what about the other six — the paying customers? How could they divvy up the $20 windfall so that everyone would get his "fair share?"
The six men 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 end up being PAID to eat their meal. So the restaurant 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 paid nothing, the sixth pitched in $2, the seventh paid $5, the eighth paid $9, the ninth paid $12, leaving the tenth man with a bill of $52 instead of his earlier $59. Each of the six was better off than before. And the first four continued to eat 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 who pointed to the tenth. "But he got $7!"
"Yeah, that's right," exclaimed the fifth man, "I only saved a dollar, too ... It's unfair that he got seven times more than me!".
"That's true!" shouted the seventh man, "why should he get $7 back when I got only $2? 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 he didn't show up for dinner, so the nine sat down and ate without him. But when it came time to pay the bill, they discovered, a little late what was very important. They were FIFTY-TWO DOLLARS short of paying the bill! Imagine that!
And that, boys and girls, journalists and college instructors, is how the 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 at the table anymore.
Where would that leave the rest? Unfortunately, most taxing authorities anywhere cannot seem to grasp this rather straightforward logic!
T. Davies
Professor of Accounting & Chair,
Division of Accounting and Business Law
The University of South Dakota
School of Business
414 E. Clark Street
Vermillion, SD 57069
Phone: 605-677-5230
Fax: 605-677-5427