- Mar 13, 2010
Its as if one person hoards all the hammers in town, and rents them out to people, then wants credit for the houses other people built with them. If they weren't hoarding the hammers, the hammers would still exist. If they were distributed equitably, no one would need to rent them, therefore building would be cheaper, therefore more would get built. In this way the fact that someone is hoarding and charging interest actually depresses economic activity, because those hoarding the cash skim a little off the top of every financial transaction thereby increasing its cost.
Those who do make a salary are not necessarily earning their money either. CEOs make multimillion dollar salaries plus bonuses even when they run their companies into the ground, as we saw just recently, with even companies that needed to be bailed out with tax dollars giving their CEOs multimillion dollar bonuses.
The top 0.1% averages 7 million a year. Total annual income is 2.1 trillion.
300k rich people have nearly the same total income between them as 120million working class people.
You can't squeeze blood from a turnip.
Half a million which, remember, they didn't really earn.
The poor are left with $6200.
In order to make a flat tax even approach "fair", you would have to make several other large changes to level the playing field.
First off, you have to eliminate ALL inheritance. That means 100% inheritance tax on everyone, from ultra wealthy to middle class. You earn your money in your lifetime, and then it gets recycled back into society. There is no justification to say that a person is entitled to money they did nothing to earn.
Second, you have to make education both free and mandatory from pre-school to at least bachelor's degree, if not more.
Third, you have to distinguish between income that comes from doing productive work (wages) from un-earned income such as dividends, interest, and capital gains. Someone who merely skims off the top of other peoples work should be taxed at a higher rate then someone who actually earns their pay by working for a living and positively contributing to society.
When libertarians and the wealthy begin to fight to level the playing field, then and only then can they claim that a flat tax is about "fairness"
A flat tax is both impractical and immoral.