Very interesting.

Art Laffer is a dick. The Laffer Curve is real, but his interpretation of it is retarded. "Why would anyone earn more money if they had to pay higher taxes?" Uhhh... so they could still have more money after paying those taxes? You jackass.

NewportBarGuy: Art Laffer is a dick. The Laffer Curve is real, but his interpretation of it is retarded. "Why would anyone earn more money if they had to pay higher taxes?" Uhhh... so they could still have more money after paying those taxes? You jackass.

It's really amazing the lapse of logic there. NYC is a perfect example of this effect. Since taxes on earners who reside in the city are around 40%, even on lower income folks, wages are naturally higher to compensate for it. It's telling that NY state is a "giver" state which means we get about 80c on the $1 we give in federal money, and in places like South Carolina where taxes and wages are lower, they are a "taker" state, which means they receive about $1.30 for every $1 they give to the federal government.

It's weird to see a sane republican these days, but that fat dude made some good points

SnakeLee: It's weird to see a sane republican these days, but that fat dude made some good points

There are lots of sane Republicans, you just don't hear about them too much, unless you watch Newshour of course.

NewportBarGuy: Art Laffer is a dick. The Laffer Curve is real, but his interpretation of it is retarded. "Why would anyone earn more money if they had to pay higher taxes?" Uhhh... so they could still have more money after paying those taxes? You jackass.

Sadly, that's what people say as to why taxes shouldn't be raised as most people don't understand how a progressive tax system works. The rich don't pay a 35% flat tax. They pay 35% after making it through the 10%, 15%, 25%, 28% and 33% tax rates, paying the 35% on any income above $379,149 (for all filing statuses).

dustman81: NewportBarGuy: Art Laffer is a dick. The Laffer Curve is real, but his interpretation of it is retarded. "Why would anyone earn more money if they had to pay higher taxes?" Uhhh... so they could still have more money after paying those taxes? You jackass.

Sadly, that's what people say as to why taxes shouldn't be raised as most people don't understand how a progressive tax system works. The rich don't pay a 35% flat tax. They pay 35% after making it through the 10%, 15%, 25%, 28% and 33% tax rates, paying the 35% on any income above $379,149 (for all filing statuses).

I've stated this a zillion times. Millionaires pay the exact same rate on the first $50K of their income as everyone else that makes $50K or more.

dustman81: NewportBarGuy: Art Laffer is a dick. The Laffer Curve is real, but his interpretation of it is retarded. "Why would anyone earn more money if they had to pay higher taxes?" Uhhh... so they could still have more money after paying those taxes? You jackass.

Sadly, that's what people say as to why taxes shouldn't be raised as most people don't understand how a progressive tax system works. The rich don't pay a 35% flat tax. They pay 35% after making it through the 10%, 15%, 25%, 28% and 33% tax rates, paying the 35% on any income above $379,149 (for all filing statuses).

You and I both know that's too many numbers and too much logic for the average American to process while sitting in front of their TV.

dustman81: The rich don't pay a 35% flat tax. They pay 35% after making it through the 10%, 15%, 25%, 28% and 33% tax rates, paying the 35% on any income above $379,149 (for all filing statuses).

Meh, the 29% effective tax rate that works out to is still pretty bad.
Don't get me wrong, I'd love to make $379,149 myself, but I'd be damned pissed about paying almost a third of it to the federal government (not including social security, etc)

How is it that we've gone 12 years under Bush's tax policies that favor the rich, and some people still think tax cuts for the rich creates jobs? It's demonstrably wrong.

They don't want to create jobs. If they did, they'd be doing it

I can just see a CEO worth $500M sitting around saying "Gee if only had $525M, I'd create some jobs!"

serial_crusher: Meh, the 29% effective tax rate that works out to is still pretty bad.

Sounds like a bargain to me. Sure, there are probably a few countries providing better services for less, but not many. And if we'd cut a shiat ton of defense and "security" spending, we could do even better.

Lionel Mandrake: How is it that we've gone 12 years under Bush's tax policies that favor the rich, and some people still think tax cuts for the rich creates jobs? It's demonstrably wrong.

They don't want to create jobs. If they did, they'd be doing it

I can just see a CEO worth $500M sitting around saying "Gee if only had $525M, I'd create some jobs!"

Ugh.

Lionel Mandrake: How is it that we've gone 12 years under Bush's tax policies that favor the rich, and some people still think tax cuts for the rich creates jobs? It's demonstrably wrong.

How is it that we spent 8 years allowing the megarich to plunder $6 trillion from the national treasury and they still think they're underpaid?

NewportBarGuy: Art Laffer is a dick. The Laffer Curve is real, but his interpretation of it is retarded. "Why would anyone earn more money if they had to pay higher taxes?" Uhhh... so they could still have more money after paying those taxes? You jackass.

I'm not familiar enough with the tax code to answer this, so maybe one of you can... is there any level of taxation where a modest raise, say $2000 per annum, would actually cost you money by pushing you up into a higher tax bracket and consuming more money than your raise as a result?

And yes, the Laffer Curve is real, but the problem is that nobody knows where the crossover point is. It's just assumed to be low when it may in fact be much higher.

Adolf Oliver Nipples: NewportBarGuy: Art Laffer is a dick. The Laffer Curve is real, but his interpretation of it is retarded. "Why would anyone earn more money if they had to pay higher taxes?" Uhhh... so they could still have more money after paying those taxes? You jackass.

I'm not familiar enough with the tax code to answer this, so maybe one of you can... is there any level of taxation where a modest raise, say $2000 per annum, would actually cost you money by pushing you up into a higher tax bracket and consuming more money than your raise as a result?

And yes, the Laffer Curve is real, but the problem is that nobody knows where the crossover point is. It's just assumed to be low when it may in fact be much higher.

You can never make less money when you make more money.

mrshowrules: You can never make less money when you make more money.

That seems intuitive, but I'm envisioning som... never mind. It was a fleeting thought. Question (obviously) answered.

Adolf Oliver Nipples: I'm not familiar enough with the tax code to answer this, so maybe one of you can... is there any level of taxation where a modest raise, say $2000 per annum, would actually cost you money by pushing you up into a higher tax bracket and consuming more money than your raise as a result?

Under zero circumstances would that occur. The nature of a progressive tax table prevents it. Despite what the GOP and the 1%ers want everyone to believe, if they make more money...they make more money. No matter how high the top tax rate is. It'd have to be over 100% for them to make LESS money.

Guy who said that misses the point. It's not that someone wealthy is opposed to making more money - they are opposed (say under the 90% top rate under JFK) to putting in the extra work or extra risk and getting a very large portion of that money taken away. i.e. What's the point of working an extra 10 hours a week if all you get is 10% of the extra money?

ArkAngel: Guy who said that misses the point. It's not that someone wealthy is opposed to making more money - they are opposed (say under the 90% top rate under JFK) to putting in the extra work or extra risk and getting a very large portion of that money taken away. i.e. What's the point of working an extra 10 hours a week if all you get is 10% of the extra money?

We're only talking about edging up the rate a few percentage points here.

Adolf Oliver Nipples: NewportBarGuy: Art Laffer is a dick. The Laffer Curve is real, but his interpretation of it is retarded. "Why would anyone earn more money if they had to pay higher taxes?" Uhhh... so they could still have more money after paying those taxes? You jackass.

I'm not familiar enough with the tax code to answer this, so maybe one of you can... is there any level of taxation where a modest raise, say $2000 per annum, would actually cost you money by pushing you up into a higher tax bracket and consuming more money than your raise as a result?

Absolutely impossible. For example, if that raise pushed you $1,000 over the bracket amount, only that last $1,000 would be taxed at the rate for that bracket. The rest would be at the same rate(s) as before.

ArkAngel: Guy who said that misses the point. It's not that someone wealthy is opposed to making more money - they are opposed (say under the 90% top rate under JFK) to putting in the extra work or extra risk and getting a very large portion of that money taken away. i.e. What's the point of working an extra 10 hours a week if all you get is 10% of the extra money?

Why, are you insinuating there's something to life other than making absolutely as much money as possible? That, at a certain point, enough is enough? That one doesn't have to stoop for every penny?

BURN HIM!

I recall Reagan talking about how he would only do so many movies a year to avoid going into the 90% tax bracket. He'd rather lie on the beach than work for 10%. Weird, huh?

dahmers love zombie: Adolf Oliver Nipples: I'm not familiar enough with the tax code to answer this, so maybe one of you can... is there any level of taxation where a modest raise, say $2000 per annum, would actually cost you money by pushing you up into a higher tax bracket and consuming more money than your raise as a result?

Under zero circumstances would that occur. The nature of a progressive tax table prevents it. Despite what the GOP and the 1%ers want everyone to believe, if they make more money...they make more money. No matter how high the top tax rate is. It'd have to be over 100% for them to make LESS money.

I would have to run some numbers, but it might be possible when considering tax credits and deductions. There may be some cases where $1 extra income over the threshold would reduce the credit or deduction by a significant amount. And though that's not relevant to the Laffer discussion, it can confuse the issue.

mikebagger: dahmers love zombie: Adolf Oliver Nipples: I'm not familiar enough with the tax code to answer this, so maybe one of you can... is there any level of taxation where a modest raise, say $2000 per annum, would actually cost you money by pushing you up into a higher tax bracket and consuming more money than your raise as a result?

Under zero circumstances would that occur. The nature of a progressive tax table prevents it. Despite what the GOP and the 1%ers want everyone to believe, if they make more money...they make more money. No matter how high the top tax rate is. It'd have to be over 100% for them to make LESS money.

I would have to run some numbers, but it might be possible when considering tax credits and deductions. There may be some cases where $1 extra income over the threshold would reduce the credit or deduction by a significant amount. And though that's not relevant to the Laffer discussion, it can confuse the issue.

This is more accurate than my earlier post. It is possible, but it would have to be a really specific situation involving credits or something along those lines. But if you're just going by gross, you're never worse off with an extra dollar of pre-tax income.

Adolf Oliver Nipples: NewportBarGuy: Art Laffer is a dick. The Laffer Curve is real, but his interpretation of it is retarded. "Why would anyone earn more money if they had to pay higher taxes?" Uhhh... so they could still have more money after paying those taxes? You jackass.

I'm not familiar enough with the tax code to answer this, so maybe one of you can... is there any level of taxation where a modest raise, say $2000 per annum, would actually cost you money by pushing you up into a higher tax bracket and consuming more money than your raise as a result?

No, but yes. It happens to people trying to move into the middle class wage brackets from below. It's not the income tax alone that gets them, but rather the phasing out of tax credits an deductions available to the poor.

"Nuts" is putting it politely.

NewportBarGuy: Art Laffer is a dick. The Laffer Curve is real, but his interpretation of it is retarded. "Why would anyone earn more money if they had to pay higher taxes?" Uhhh... so they could still have more money after paying those taxes? You jackass.

over in 2 (well, 1, but it was teh second one)

serial_crusher: dustman81: The rich don't pay a 35% flat tax. They pay 35% after making it through the 10%, 15%, 25%, 28% and 33% tax rates, paying the 35% on any income above $379,149 (for all filing statuses).

Meh, the 29% effective tax rate that works out to is still pretty bad.
Don't get me wrong, I'd love to make $379,149 myself, but I'd be damned pissed about paying almost a third of it to the federal government (not including social security, etc)

I'm curious - how did you come up with 29%?

torch: I recall Reagan talking about how he would only do so many movies a year to avoid going into the 90% tax bracket. He'd rather lie on the beach than work for 10%. Weird, huh?

was 90% on the top part of your income too high?
DUHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH

is the current 35% too low? DUHHHHHHHHHHHHHHHHHHHH

45, 50, hell even 60 ....

but to argue that 35% is too high? FARK EM

cmunic8r99: serial_crusher: dustman81: The rich don't pay a 35% flat tax. They pay 35% after making it through the 10%, 15%, 25%, 28% and 33% tax rates, paying the 35% on any income above $379,149 (for all filing statuses).

Meh, the 29% effective tax rate that works out to is still pretty bad.
Don't get me wrong, I'd love to make $379,149 myself, but I'd be damned pissed about paying almost a third of it to the federal government (not including social security, etc)

I'm curious - how did you come up with 29%?

really?
you dont know how the tax system works?
you pay 10% on the first X dollars
you pay 15% on the next Y dollars
...
you pay 35% only on the portion of your income which is above $379,151

Link (new window)

make me some tea: ArkAngel: Guy who said that misses the point. It's not that someone wealthy is opposed to making more money - they are opposed (say under the 90% top rate under JFK) to putting in the extra work or extra risk and getting a very large portion of that money taken away. i.e. What's the point of working an extra 10 hours a week if all you get is 10% of the extra money?

We're only talking about edging up the rate a few percentage points here.

I realize this. I think many Republican Congressmen are being unreasonable. Sometimes tax increases are necessary, though not to the punitive levels we have seen in the not-too-distant past.

bighasbeen: ArkAngel: Guy who said that misses the point. It's not that someone wealthy is opposed to making more money - they are opposed (say under the 90% top rate under JFK) to putting in the extra work or extra risk and getting a very large portion of that money taken away. i.e. What's the point of working an extra 10 hours a week if all you get is 10% of the extra money?

Why, are you insinuating there's something to life other than making absolutely as much money as possible? That, at a certain point, enough is enough? That one doesn't have to stoop for every penny?

BURN HIM!

While I realize you are sarcsming, I shall answer you anyway. I am not 1%, nor will I likely ever be. I don't think money is all that important, What counts isn't even happiness (which money can buy). What counts is joy. I concentrate on things that bring me joy: my son, my girlfriend (and future wife), God, etc... We could live our lives poor as church mice, but the joy we would have together would make everything worth it.

FreakinB: Adolf Oliver Nipples: NewportBarGuy: Art Laffer is a dick. The Laffer Curve is real, but his interpretation of it is retarded. "Why would anyone earn more money if they had to pay higher taxes?" Uhhh... so they could still have more money after paying those taxes? You jackass.

I'm not familiar enough with the tax code to answer this, so maybe one of you can... is there any level of taxation where a modest raise, say $2000 per annum, would actually cost you money by pushing you up into a higher tax bracket and consuming more money than your raise as a result?

Absolutely impossible. For example, if that raise pushed you $1,000 over the bracket amount, only that last $1,000 would be taxed at the rate for that bracket. The rest would be at the same rate(s) as before.

This. Your tax rate only refers to what you pay on your last dollar earned. Everyone pays the same rate up to limit of each bracket. In case you need more info

make me some tea: It's telling that NY state is a "giver" state which means we get about 80c on the $1 we give in federal money, and in places like South Carolina where taxes and wages are lower, they are a "taker" state, which means they receive about $1.30 for every $1 they give to the federal government.

The nomenclature that is used in Canada is 'have' and 'have not' provinces. If you want to use those transfer payments to make a political point (and you should), you might want to upgrade the terms to something politically catchy, and standardize the narrative. 'Welfare States' might have a broader emotional appeal, as well. It's the sort of bait that might get the right to agree and screw themselves.

ArkAngel: What's the point of working an extra 10 hours a week if all you get is 10% of the extra money?

For the ultra-rich, it stopped being about the money long ago.

When you've got $100M in the bank, there's no reason to keep working if it's just for money. They're just playing to win at that point. They enjoy succeeding, beating competition.

NewportBarGuy: Art Laffer is a dick. The Laffer Curve is real, but his interpretation of it is retarded. "Why would anyone earn more money if they had to pay higher taxes?" Uhhh... so they could still have more money after paying those taxes? You jackass.

Pretty simple. People can be as tight with their hundred millionth dollar as they are with their first. If you think that your government - federal, state, county, local, whatever - is doing deeply stupid expensive things with your money, why on earth would you want them doing more of it?

A little farther down TFA is this passage: PAUL SOLMAN: But since he disputes the premise that it's the wealthy who need low taxes to create jobs, he sees little harm in raising their taxes when government really needs the revenue.

Or maybe they really need to make some long-overdue cuts. I know, I know, crazy talk.

make me some tea: It's telling that NY state is a "giver" state which means we get about 80c on the $1 we give in federal money, and in places like South Carolina where taxes and wages are lower, they are a "taker" state, which means they receive about $1.30 for every $1 they give to the federal government.

Yeah, but there's tons of other factors in play other than wages and taxes. New York also gets back less in part because we have a somewhat smaller elderly population, and because there's a lot less defense spending that goes to New York, and not a whole lot of federally-owned land compared to out west.

NewportBarGuy: The Laffer Curve is real,

It's not that the Laffer Curve is real, but that it's merely supposed to be a simple, non-specific sweeping generalization of taxes and revenues using polar opposite extremes to accentuate the bell curve. But it doesn't have the substance to construct an entire economic platform around. The Laffer Curve is woefully inefficient at differentiating the various types of taxes, the additive value of each (and their role at the federal/state/municipal level), and other nitty gritty stuff. It just doesn't go there. Implementing actual tax strategy is far more complicated than the Laffer Curve lets on.

So while it is true, it's only true insomuch as it's a philosophical theory. It has no practical application beyond that.

ryarger: Ishkur: NewportBarGuy: The Laffer Curve is real,

It's not that the Laffer Curve is real, but that it's merely supposed to be a simple, non-specific sweeping generalization of taxes and revenues using polar opposite extremes to accentuate the bell curve. But it doesn't have the substance to construct an entire economic platform around. The Laffer Curve is woefully inefficient at differentiating the various types of taxes, the additive value of each (and their role at the federal/state/municipal level), and other nitty gritty stuff. It just doesn't go there. Implementing actual tax strategy is far more complicated than the Laffer Curve lets on.

So while it is true, it's only true insomuch as it's a philosophical theory. It has no practical application beyond that.

More fundamentally it is true that a 0% tax burden will result in $0 revenue long term. Likewise a 100% tax burden will result in $0 revenue long term (once the government owns all property).

Given that for each single point of absolute tax burden there is a single amount of revenue that will be earned, there *is* a monotonic function (e.g. a curve) that will describe revenue given the tax burden.

Where the Laffer curve fails entirely is coming up with an even remotely realistic model. His theory (beyond the absolutely basics described above) are unsupported tripe and his model has utterly failed at predicting reality.

the laffer curve is nother more than a restatement of the law of deminishing returns.
No human being in the history of the world has ever been able to draw the curve, and say exactly where we are on that curve, and what exact effects moving us one way or the other by a specific measurable amount willl have on the economy. Not once has this happened.

If nothing nothing else, the Laffer curve has become the ultimate straw man argument.... "what happens when we tax everyone at 100%?"

ryarger: More fundamentally it is true that a 0% tax burden will result in $0 revenue long term. Likewise a 100% tax burden will result in $0 revenue long term (once the government owns all property).

Those are the only two points that the Laffer Curve gets right, but they are functionally useless -- taxes will NEVER be set at either 0% or 100%, so what good is it pointing out that neither will bring revenue? Great, Arthur, thanks for warning us about something we were never going to do.