The Self-Destruction of the 1 Percent

[Gerald]

IN the early 14th century, Venice was one of the richest cities in Europe. At the heart of its economy was the colleganza, a basic form of joint-stock company created to finance a single trade expedition. The brilliance of the colleganza was that it opened the economy to new entrants, allowing risk-taking entrepreneurs to share in the financial upside with the established businessmen who financed their merchant voyages.

Venice’s elites were the chief beneficiaries. Like all open economies, theirs was turbulent. Today, we think of social mobility as a good thing. But if you are on top, mobility also means competition. In 1315, when the Venetian city-state was at the height of its economic powers, the upper class acted to lock in its privileges, putting a formal stop to social mobility with the publication of the Libro d’Oro, or Book of Gold, an official register of the nobility. If you weren’t on it, you couldn’t join the ruling oligarchy.

The political shift, which had begun nearly two decades earlier, was so striking a change that the Venetians gave it a name: La Serrata, or the closure. It wasn’t long before the political Serrata became an economic one, too. Under the control of the oligarchs, Venice gradually cut off commercial opportunities for new entrants. Eventually, the colleganza was banned. The reigning elites were acting in their immediate self-interest, but in the longer term, La Serrata was the beginning of the end for them, and for Venetian prosperity more generally. By 1500, Venice’s population was smaller than it had been in 1330. In the 17th and 18th centuries, as the rest of Europe grew, the city continued to shrink.

http://www.nytimes.com/2012/10/14/op...ercent.html?hp


Note: October 13, 2012

[u crank]

Very interesting read. Especially the last three paragraphs.

[Onkel Neal]

The Self-Destruction of the 1 Percent

In the 1950s, the marginal income tax rate for those at the top of the distribution soared above 90 percent, a figure that today makes even Democrats flinch. Meanwhile, of the 400 richest taxpayers in 2009, 6 paid no federal income tax at all, and 27 paid 10 percent or less. None paid more than 35 percent.

Alas, why can't we make it simple and just have all individuals pay a flat rate on their income, say 15%. No exceptions, no loopholes, no deductions.

[Catfish]

Because this would be unfair.
The well-off do so much for the society, and they still pay more taxes than the unwashed masses. Said Bush. Says Romney.
And someone has to pay a trillion dollars for the new jets alone, let alone funding the CIA and NSA. You can't even ask where the money goes because of course it is all confidential.
Also, the "grey lady" is of course ultra-left. Say republicans.

Ahem I think you are right, but this would be too easy and a lot of people would lose their jobs (like tax advisors) And the rest of the big US companies would probably entirely move to China ..

[the_tyrant]

Originally Posted by Neal Stevens

Alas, why can't we make it simple and just have all individuals pay a flat rate on their income, say 15%. No exceptions, no loopholes, no deductions.

Hey, where would all the accountants work?

Well I believe, that we are fundamentally living in an age of high social mobility. It is easier than ever for one to simply pack up, and move.

The nation state has always been a monopoly. There is only one in a given location. You must pay up the taxes, and you must accept their "services" (i'm sure there are criminals out there who would "refuse" the "policing" service). Thus nations have always been able to get away with a lot. You can't even establish competition! (hey, if you want to start your own government, the government calls you a rebellion and sends in the army) Thus, I would say, that nation states have once enjoyed a monopolistic position that even AT&T and Microsoft cannot touch.

However, this is rapidly changing. My family has bounced around the world a lot, living in quite a few different places. I know lots of people like that out there, one of my dad's friends moved to Canada because the smog in Shanghai is killing him.I also know Canadians who go abroad to work, since there are better opportunities out there.

Thus in this day and age, the 90% taxation is IMPOSSIBLE. Remember the surprise when one of the Facebook co-founders gave up on his American citizenship? he is willing to give it up, because in his opinion, the "services" the US government pays him is not worth the "price" (taxes).

If your country "charges too much" for the "services", you can leave.

There are millions of people who risk their life to enter the US illegally every year. They are voting with their legs, and wallets.

If you don't like a country, you can leave (although yes, it is still difficult, but it is a viable option now).


Raise the tax, and what is to stop people from leaving? Remember, America is competing with around 200 other countries out there.

[Gerald]

http://www.subsim.com/radioroom/showthread.php?t=199135

[Takeda Shingen]

Originally Posted by Neal Stevens

Alas, why can't we make it simple and just have all individuals pay a flat rate on their income, say 15%. No exceptions, no loopholes, no deductions.

QFT. And just think about how much simpler tax time would be.

[Sailor Steve]

But...but...but...but just think of how the unemployment rate would skyrocket, with the poor IRS going out of business!

Have you no hearts?

[Skybird]

I'm for it. But not before you have installed a truly communist society where private wealth practically has been abandoned and all people are equal in material chances and starting conditions.

Then one fixed mark for the poor and the rich as well is not just simple, but also balanced and fair.

But the "no loopholes, no exceptions" part is something I can subscribe too without second reading. But lobby groups will prevent this from coming true - before that happens it's more likely that the stand-your-ground laws in half of the American states will fall.

[Stealhead]

Originally Posted by Skybird

I'm for it. But not before you have installed a truly communist society where private wealth practically has been abandoned and all people are equal in material chances and starting conditions.

Then one fixed mark for the poor and the rich as well is not just simple, but also balanced and fair.

Then in fact you are not for it because your prerequisite condition is simply impossible to achieve even in such societies positions become wealth and a truly communist
society is impossible this fact has been proven communism fails at its goal of making people equal if one person feels that they are not.Even in your own wording you use practically
not completely.

[Armistead]

I added up all my taxes once about 10 years ago. I'm talking all the taxes, income, property, sales, gas, all those lil taxes in bills, etc.... Turned out I was paying about 37% of my income on taxes. Think I was making about 60K a year when I did this.

My guess is I left out some somewhere...., probably closer to 40%.

[nikimcbee]

Neal, don't be a hater. What will the tax lawyers do? and and and, it would only take 5 minutes to do your taxes with quicken. What will the tax software programmers do? You'll ruin the democrat playbook. How can you do class warfare if everybody has the same rate?

and and and, just think of all the threads you will wipe out by not being able to post whose percentage is paying X percentage and the 40% of the 12 % that pays 32% on Mondays but not Fridays when the 67% of kitten owners use 23% of the resources in Canada, but 5% of Quebecers use 99% of Reece's makeup kit that he bought on holiday to Kiwiland who use 11% of the BBQ sauce produced in 45% of New Jersey, when it's not fair that Texas produces only 47% consumed by .75 % ofharley riders but not 25% of suzuki riders that left San Antonio going 46% of 56km/hr and the 84.5% of rich honda goldwing owners left Sturgis going 65 mph, at what point do they intersect 3% of the way?.

Think of Jim's post count!

I think it's just easier to leave the tax code as is.

[u crank]

[Skybird]

Originally Posted by Stealhead

Then in fact you are not for it because your prerequisite condition is simply impossible to achieve even in such societies positions become wealth and a truly communist
society is impossible this fact has been proven communism fails at its goal of making people equal if one person feels that they are not.Even in your own wording you use practically
not completely.

Congratulations, you have correctly observered that, and very precisely.

[Takeda Shingen]

You need to do something about freezing payroll tax too. Otherwise, nothing's stopping Washington from doing the ol' Gipper two-step.