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6 hours ago, Lord Liaden said:

Vondy, if you don`t mind my asking, when you say you vote ``libertarian,`` what are the key issues you are voting for? Modern libertarianism has branched in divergent economic and social directions. And have you found candidates, individual or part of collectives, who espouse your branches?

 

I would love to have had a lengthy discussion about this with you, as well as the diverse views espoused by contemporary libertarian voters, but based on how this thread went I don't believe that would prove fruitful. I have concluded that breaking my long hiatus from the boards was seriously misguided. Things here are the same as they always were, but somehow they have gotten worse at the same time.  I don't see an upside in making the attempt.

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1 hour ago, Dr.Device said:

 

 

You keep using that terminology and I, for one, have no idea what you mean by it.

 

 

 

Basically: Do you want to "win America" (finite) or keep America going (infinite) because the aspirations and values ensconced in its system of government make it a game worth playing? The predictability of campaigning on values rather than partisan interests creates the well of trust necessary for compromise, cooperation, and attaining the common weal. That of course assumes voters for both parties see an inherent value in keeping the aspirational political values and system America was founded on going. My impression is that there a lot of people in both tribes that say they do, but really don't. 

 

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Well, I watched the video, and now I understand what you mean by "finite" and "infinite" in this context, at least.

 

I want to keep America going (infinite), partly because it's my country, partly because I live here, partly because of how America affects the rest of humanity, and partly because of the values ensconced in its system of government. Right now the Democrats don't really seem like they're much of a net gain in those areas, but once again, the Republicans seem like they're rapidly moving the country in the wrong direction.

 

Vondy, I went back and looked at your list of libertarian values. With the exception of "friendliness and good faith across the aisle", they look like standard Republican/Tea Party points; right-wing ideas very carefully couched in polite terms; what they call "dog whistles". I hope I'm misreading your intent.

 

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1 hour ago, Zeropoint said:

Vondy, I went back and looked at your list of libertarian values. With the exception of "friendliness and good faith across the aisle", they look like standard Republican/Tea Party points; right-wing ideas very carefully couched in polite terms; what they call "dog whistles". I hope I'm misreading your intent.

 

 

I'll just plainly state that I think this statement is incredibly unfair.  Hopefully I'm not misreading your intent.

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I have stayed away from the hero boards, ngd, and this thread in particular for a while.   Mostly I have simply followed certain news developments closely, and the Mueller investigation in particular.   

I wrote a paper on investigation of high level executive branch wrongdoing while in law school.   It required a close scrutiny of the history of such investigations,  particularly Watergate,  the Iran-contra scandal and the Starr investigation.   

My impression is that we as a country need to prepare for the worst with regard to the ultimate findings of the investigation,  and we also must be capable of doing what must needs be done.  

In effect, that requires a change of control of one or both chambers of Congress.  I have zero confidence in the current Congressional leadership to rise above selfish partisan politics and make the choice that the Constitution and the law requires.  The Senate will not do so except under enormous external pressure from the public and the press.  

 

In the event we as a people and a country do not rise to the challenge,  history and posterity will record our fecklessness for all time.

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5 minutes ago, megaplayboy said:

I have stayed away from the hero boards, ngd, and this thread in particular for a while.   Mostly I have simply followed certain news developments closely, and the Mueller investigation in particular.   

 

"May you live in interesting times..."

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On 8/7/2018 at 2:19 AM, Vondy said:

If it were my word here is what I would do:

 

  • Do away with income tax. Yes, I said that.
  • Leave the corporate income tax rate at 20%.
  • Jack up the the capital gains tax up to 50-70%.. 

What would be the results:

  • Poor and middle class people would have more income for expenses, education, and insurance.
  • Businesses would know what to expect and be able to make healthy profits - and more people could start small businesses.
  • The money made from capital gains alone - which are not earnings - would pay for the military, medicare, and social security

 

Some comments, solely directed to tax matters.

 

First, the "corporate tax" is an income tax.  It taxes income earned within a corporation.  That income eventually finds its way out to individuals.  Under your policy, does a truck driver who incorporates for protection from unlimited personal liability (for his own errors, or those of his employees should his business grow) pay a 20% tax for this privilege?  Too often, "corporation" is taken to be "Big Black Box with no humans involved".  Many small businesses are operated through corporations.

 

In the US model, they would likely be limited partnerships, LLPs, LLLPs, ULCs and other forms of flow through entities which permit income to be reported  by the individual owners while preserving limited liability.  Would this avoid taxation of the corporate income in your model?  If so, why would larger corporations not adopt the same structures?

 

I would expect corporations to issue bonds, paying deductible interest to their tax-free bondholders, rather than shares, paying non-deductible dividends to shareholders.  With the sharp decline in corporate income, so much for corporate taxes.

 

Capital gains arise on shares, so I would expect to see corporations keep their share value stable by paying plenty of tax- free (they are income) dividends to their shareholders.  Other assets would still have capital gains, of course,  Like homes.  Would there be any exception in your plan for gains on homes, of would these generate 50% to 70% tax on gains which may only arise due to inflation when a family moves?

 

I am unclear where sales taxes or property taxes fit into your plan.  Estate taxes for that matter (easier for us Canadians to forget as we replaced estate tax with taxing capital gains inherent in assets at date of death).  Will they remain the same or be eliminated?  As they were not part of your plan, I assume they will not replace income taxes.

 

I find many tax plans share the "lack of economic reality" issue with many other promises made by politicians, however I believe your own are linked to reduced government services  to permit the government to balance the books on its new, lower revenue base.

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12 hours ago, Hugh Neilson said:

 

Some comments, solely directed to tax matters.

 

I want to be clear that my three bullet points do not constitute a "tax plan." What I wrote is, at best, an outline for a more in-depth discussion I want our leaders to be having. My essential point was that (in terms of high level economic theory) the democrats keep pulling the wrong levers while the republicans refuse to pull the right one. I'm not even strongly opposed to keeping the income tax for top earners (e.g., 200K+). All of the issues you raise are germane and need to be addressed. I do not regard them as problems, however. Rather, they are details to be sorted out. 

 

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First, the "corporate tax" is an income tax.  It taxes income earned within a corporation. 

 

I'm not sure that's true on this side of the border. Corporate taxes are paid on business income after expenses, including salaries, are deducted. As a result, we corporate taxes are on profits.

 

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That income eventually finds its way out to individuals.  Under your policy, does a truck driver who incorporates for protection from unlimited personal liability (for his own errors, or those of his employees should his business grow) pay a 20% tax for this privilege?  Too often, "corporation" is taken to be "Big Black Box with no humans involved".  Many small businesses are operated through corporations.

 

I work for a small-medium business and am familiar with a lot of the accounting. I would note that most small-business owners pay themselves a salary, which is personal income and not a part of the taxable profits of the business. That is especially true of sole-proprietors. Its an expense. As such, your theoretical truck driver could incorporate, pay himself a salary, include that in his deductible operating expenses, and then pay corporate taxes on the remaining profits, if any.  To avoid abuse you can put a reasonable cap on how much salary can be deducted as a business expense.

 

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In the US model, they would likely be limited partnerships, LLPs, LLLPs, ULCs and other forms of flow through entities which permit income to be reported  by the individual owners while preserving limited liability.  Would this avoid taxation of the corporate income in your model?  If so, why would larger corporations not adopt the same structures?

 

I would expect corporations to issue bonds, paying deductible interest to their tax-free bondholders, rather than shares, paying non-deductible dividends to shareholders.  With the sharp decline in corporate income, so much for corporate taxes.

 

Capital gains arise on shares, so I would expect to see corporations keep their share value stable by paying plenty of tax- free (they are income) dividends to their shareholders.  Other assets would still have capital gains, of course,  Like homes.  Would there be any exception in your plan for gains on homes, of would these generate 50% to 70% tax on gains which may only arise due to inflation when a family moves?

 

I will note we had a maximum capital gains tax of 35% in 1979 and that the rules were different than they are today. You can create exclusions for primary residences (the home you live in),  put a cap on dividends declared as "income,"  determine which kind of corporation pays what tax rate and enjoys which exceptions  etc. I'm sure I missed something, was unclear about something, or was wrong about something. Let me know.

 

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I am unclear where sales taxes or property taxes fit into your plan. 

 

Sales and property taxes are generally State and municipal taxes here. If the people of a jurisdiction want a program and pay for it with income tax, sales tax, or fees, I'm fine with it. Indeed, the state and local level is where I want most of my government. That's where I can keep the best eye on it and have the most direct impact on it. Washington never hears my voice, but Olympia frequently does. It also accounts for local culture and mores. In fact, for me, the silver lining of Trump is that the left has suddenly rediscovered Federalism. What I'm addressing is Federal government, taxes, and spending. The collective stuff we have to deal with at a national level is what I'm concerned with.

 

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Estate taxes for that matter (easier for us Canadians to forget as we replaced estate tax with taxing capital gains inherent in assets at date of death).  Will they remain the same or be eliminated?  As they were not part of your plan, I assume they will not replace income taxes.

 

We have living trusts and other mechanisms to insulate assets. The Canadian system could be workable. I might make a few modest exceptions. For instance, let's say I own three homes and my daughters live in two of them. If I leave them the houses they live in and my house goes to the general estate, then I might only count my house as an asset for the purposes of estate tax. I will utter the taboo Internet phrase: "I don't know."

 

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I find many tax plans share the "lack of economic reality" issue with many other promises made by politicians, however I believe your own are linked to reduced government services  to permit the government to balance the books on its new, lower revenue base.

 

You are correct, I want a balanced budget and I am willing to cut pretty deep to ensure we hand our children and grandchildren a fiscally solvent nation. Even with reduced revenues, we can maintain our military, critical infrastructure, essential agencies, and even social security and medicare with only modest reforms. To do that, however, we need to seriously reduce other federal services, or charge fees for non-essential services. Our national leaders have been spending like a lecherous drunk with a credit card in a Manhattan strip club. Neither party even feigns pretense about treating the people's treasure as their own blank check at this point. Every week I sit down, go over the accounts, and balance my budget. I save for down payments on major purchases and investments. I keep my debt to income ratio low. I accept I can't have everything I want. I am not unique in that. Most Americans live that way. So can Uncle Sam.  

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On 8/6/2018 at 9:23 PM, Dr.Device said:

 

Like Lord Liaden, I am very curious what Libertarian party positions you find attractive. Although they are one hundred percent on board with removing the income tax, the idea of raising the capital gains tax is a complete non-starter with them. Their platform calls for the elimination of all taxes, as a matter of fact. And the removal of all environmental regulations. And anti-monopoly laws. Any economic regulation at all, actually. Oh, and they want to remove all anti-discrimination laws. Is there something in there that you find attractive? Are the Libertarian politicians playing that infinite values-based game you prize? Or is voting for them a protest? 

 

I'm pretty circumspect about the boards right now, but my impression is that you are asking a genuine question in good faith. To that end, I'll try to give you a genuine answer in the same spirit. I'm here to have discussions.

 

Do I find that attractive? Not at all. The platform you are referencing is the Rothbard platform and dates back to the 1970's. For many decades the Libertarian party was basically a gang of truculent idealogues and the platform represented what its candidates, often militant and zany oddballs, ran on. Over the past two decades, however, the composition of the party has changed dramatically. The party has absorbed a wave of both democrat and republican political refugees, who now compose what is commonly referred to as the "pragmatists" within the party. An excellent (but long) article on how this played out in 2016 can be found here: Did The Libertarian Party Blow It?

.

The pithy maxims most commonly used to explain pragmatist philosophy are "free markets and free minds" or "fiscal responsibility and social tolerance." This influx has naturally resulted in a great deal of dynamic tension within the party, which is amplified by the fact that you have everyone from radical anarcho-capitalists to paranoid preppers to moderate classical liberals in their ranks. The Johnson-Weld ticket represented an internal triumph of the pragmatic wing of the party. You will note, much to the consternation of the ideologues, their platform was not the Rothbard platform.

 

At this point more pragmatists run for office as Libertarians than ideologues, and they are seldom in lockstep with Rothbard's platform. This clearly presents a serious branding problem for the modern Libertarian party. While those familiar with today's party have an implicit understanding of what these candidates stand for, those outside of the party see the old platform, shake their heads, and say "Oh, great. God help us. Another castle-in-the-sky Libertarian whack-a-mole!"  

 

Every Libertarian candidate I have voted for is playing an infinite game. This may because they have that luxury. They only now becoming ready for "prime-time" and are not locked in a machinean two-party blood fued. They don't have any real power to be interested in at this point. Unfortunately, Johnson was an affable but hapless candidate. He ran on values (an infinite game), but was ill-prepared for a fast-paced television campaign. Weld was the better candidate, but playing second fiddle. Was my vote in 2016 a protest vote? Yes, certainly. But it was also a values vote.  

 

In reference to myself, I only use the term "libertarian" loosely and adjectivally. I am a classical liberal who strongly advocates strict federalism, fiscal pragmatism, individual liberty, and social tolerance. I am also intellectually liberal. So much so that more than one conservative interlocutor has accused me of being Epicurean or libertine. That's not really accurate, but not so far off the mark, either. My opposition to contemporary progressive social politics isn't rooted in values. It stemps from my perception that the movement has been hijacked by a stridently illiberal and authoritarian mob. From where I sit, a regressive, revanchist mirror universe Tea-Party currently rules the left.  

 

That said, I am a "faint hearted originalist." An originalist because I believe in the aspirational values and system of government our Constitution represents. Faint-hearted because I don't want berobed bomb-chuckers wreaking social and economic havoc by uprooting ideologically imperfect, but reasonable precedents. I don't believe the Constitution is out of step with our essential values. I think it informs them. Look how far its brought us! The amendment process allows us to tweak it without doing its intent injustice. For me it is not a source of pathos, but of pride. Liberty for all is an unobtainable ideal. We will always fall short. For me, its the struggle for liberty that matters, and defines us as a nation. 

 

My biggest issue with our national ethos today is that, due to some very serious mistakes we've made over the past two decades, politics are now center stage. To a degree, that's necessary. However, everthing, inlcuding our diets and hairstyle and wardrobes and entertainment has become hyper-politicized. Politics is downstream from culture and political didacticism produces pitiful cultural product and shallow society. Most of the social change people are demanding (much of it quite justly) should be pursued on the cultural and interpersonal front. 

 

One thing I've learned is that you legislate culture at your own peril. The reason people are seeing such virulent backlash is that law is usually the wrong lever to pull. I'm not saying you shouldn't legislate some basic social tenets (reasonable discimination laws, for instance), but people too often forget that the law boils down to the maxim "violence is golden." Law must be enforced. That means sending men and women with guns into your neighbors houses and businesses to force compliance / get your way.  

 

As a result, when someone says "there oughta be a law!" I always stop and ask "is this something I am willing to use violence against my neighbors to achieve?" If its not a question of ensuring fair play, public health, public safety, or good order I tend to be circumspect about using the law (government) as a lever. You could say I'm "fiscally pragmatic, geopolitical circumspect, conservation friendly, and socially liberal," and that I live by the mantra "let people alone." I don't like butt-in-skis or bullies irrespective of which side of the aisle they hail from. That's the libertarian streak.

 

I don't know if I really answered your question. I apologize if I didn't. Let me know.

 

 

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On 8/7/2018 at 12:12 AM, Zeropoint said:

Well, I watched the video, and now I understand what you mean by "finite" and "infinite" in this context, at least. I want to keep America going (infinite), partly because it's my country, partly because I live here, partly because of how America affects the rest of humanity, and partly because of the values ensconced in its system of government. Right now the Democrats don't really seem like they're much of a net gain in those areas, but once again, the Republicans seem like they're rapidly moving the country in the wrong direction.

 

The lack of net-gain was the essential point I was getting at. 

 

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Vondy, I went back and looked at your list of libertarian values. With the exception of "friendliness and good faith across the aisle", they look like standard Republican/Tea Party points; right-wing ideas very carefully couched in polite terms; what they call "dog whistles". I hope I'm misreading your intent.

 

 

The Tea Party was a reactionary movement dominated by social conservatives and the religious right. It was also, at its core, a extremist and populist anit-Obama movement. None of those things represent me or are inherent in the political values I expressed. I'm not big on guilt by association or painting with a broad brush. That some members of the Tea Party share some of the political values I expressed has nothing to do with me. JFK also shared most of those values I expressed. Indeed, "JFK Democrat" would not be a bad descriptor for my politics. The problem is, he was probably too far to the "right" to win his own party's nomination today. I'm intellectually liberal in the age of reason / enlightenment sense, and am frequently at odds with social conservatives. If classic liberalism, federalism, fiscal pragmatism, and personal liberties are 'dog whistles' I can only conclude, with regret, that a civil and meaningful conversation is beyond our reach. Despite that, I wish you well. May you know life, liberty, and happiness.

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6 hours ago, Vondy said:

I'm not sure that's true on this side of the border. Corporate taxes are paid on business income after expenses, including salaries, are deducted. As a result, we corporate taxes are on profits.  

 

My general experience is that "income" for income tax purposes is "profit". Sales taxes tend to be on gross, but are paid by the consumer, not the producer.  Perhaps you intend your corporate tax to be on something else (such as capital), but that is not what I typically see as a "corporate tax".  Rather, I typically see tax on the same income an individual would pay income tax on.

 

6 hours ago, Vondy said:

I work for a small-medium business and am familiar with a lot of the accounting. I would note that most small-business owners pay themselves a salary, which is personal income and not a part of the taxable profits of the business. That is especially true of sole-proprietors. Its an expense. As such, your theoretical truck driver could incorporate, pay himself a salary, include that in his deductible operating expenses, and then pay corporate taxes on the remaining profits, if any.  To avoid abuse you can put a reasonable cap on how much salary can be deducted as a business expense.

 

This is a common model in Canada.  As I understand the US model, the norm for small business is to structure as a flow through entity so all income is reported by the individuals.  For an unincorporated business, salary to the proprietor (or to partners) is not generally considered an "expense", but rather the profits of the owner.  If the owner is not taxable on those profits unless he incorporates, there is a clear economic disincentive to incorporation.  Even in your example, a cap to his deductible salary is proposed, where had he not incorporated, the income from his business would be free of taxation because you propose to have no personal income tax.

 

Is the goal to tax the source of wealth (a tax on business, however defined) or to tax the legal structure (corporations pay tax, but proprietors and partnerships do not)?  Determining a "reasonable salary" for any given contribution of labour is also no mean feat. 

6 hours ago, Vondy said:

I will note we had a maximum capital gains tax of 35% in 1979 and that the rules were different than they are today. You can create exclusions for primary residences (the home you live in),  put a cap on dividends declared as "income,"  determine which kind of corporation pays what tax rate and enjoys which exceptions  etc. I'm sure I missed something, was unclear about something, or was wrong about something. Let me know.

 

 

Each issue creating new challenges and making the system more complex, but differentiation is certainly possible.  At the core,. I find a major challenge is that a corporation's income can be accessed in two ways.  It can pay dividends, or its shares can be sold.  These are simply two different means of accessing the same value.  Taxing them differently creates a bias to one approach over the other.  As a very simple example, let's assume our truck driver corporation accumulates $100,000 a year.  After 40 years, the truck driver retires.  There is now $4 million in the company (ignoring return on the reinvested funds).

 

Should his tax be different if he takes dividends over a 25 year retirement than if he sells his shares?  Let's add another wrinkle - perhaps his company invested funds to create a pension for him, the key employee.  Should he be taxed differently on that source of retirement income? 

 

What if he had taken the annual $100k as extra salary, or as dividends, and invested it personally to fund his retirement?

 

All of these use the same funds for the same purpose.  Is one approach beneficial, or detrimental, to society as a whole, supporting the notion that it should receive more favourable, or less favourable, treatment from the tax system?  If this is your retirement, being taxed at 0% or 70% would seem a very significant issue.

 

BTW, I am skipping over a lot of comments, simply because I see little to add.  For example, the clarification that you are discussing funding Federal costs, and leaving sales and property taxes to more local levels.  Although we then have to consider which services are available where, and funded how.  For example, if education is a State service, why would I not wish to reside in a state that provides public education at a high level until my education is complete, then move to a state where taxes are limited, and education less funded, now that I have my own skills to command an income?  That's an issue often raised in international tax matters - the "brain drain".

 

6 hours ago, Vondy said:

We have living trusts and other mechanisms to insulate assets. The Canadian system could be workable. I might make a few modest exceptions. For instance, let's say I own three homes and my daughters live in two of them. If I leave them the houses they live in and my house goes to the general estate, then I might only count my house as an asset for the purposes of estate tax. I will utter the taboo Internet phrase: "I don't know."

 

You are correct, I want a balanced budget and I am willing to cut pretty deep to ensure we hand our children and grandchildren a fiscally solvent nation. Even with reduced revenues, we can maintain our military, critical infrastructure, essential agencies, and even social security and medicare with only modest reforms. To do that, however, we need to seriously reduce other federal services, or charge fees for non-essential services. Our national leaders have been spending like a lecherous drunk with a credit card in a Manhattan strip club. Neither party even feigns pretense about treating the people's treasure as their own blank check at this point. Every week I sit down, go over the accounts, and balance my budget. I save for down payments on major purchases and investments. I keep my debt to income ratio low. I accept I can't have everything I want. I am not unique in that. Most Americans live that way. So can Uncle Sam.  

 

Gotta run...you hit two more issues above.

 

Why should your daughters get houses tax-free when my kids either inherit nothing and must build their own wealth, or built their own wealth, bought their own homes and now inherit some other form of wealth?  I agree with your statement - "I don't know" - knowing what is fair is no easy task.

 

Finally, the problem often is that the electorate each wants a system which gives them more value in benefits than they pay in taxes,  We all know that this math is unworkable, but we are often alll too happy to accept the promise of getting more out than we put in when we stand at the polling station.  Or at least a majority of us are - enough to win the election.

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2 hours ago, Hugh Neilson said:

 

My general experience is that "income" for income tax purposes is "profit". Sales taxes tend to be on gross, but are paid by the consumer, not the producer.  Perhaps you intend your corporate tax to be on something else (such as capital), but that is not what I typically see as a "corporate tax".  Rather, I typically see tax on the same income an individual would pay income tax on.

 

In the US "income tax" is generally a reference to personal income, such as salaries, dividends, and profits from private sales. Corporate taxes, while they may technically be income taxes on a business' revenues, are treated as separate. We do not have Federal sales or property taxes so they aren't directly relevant to a discussion of our federal tax code, though a discussion of fees would be germane.  

 

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This is a common model in Canada.  As I understand the US model, the norm for small business is to structure as a flow through entity so all income is reported by the individuals.  For an unincorporated business, salary to the proprietor (or to partners) is not generally considered an "expense", but rather the profits of the owner.  If the owner is not taxable on those profits unless he incorporates, there is a clear economic disincentive to incorporation.  Even in your example, a cap to his deductible salary is proposed, where had he not incorporated, the income from his business would be free of taxation because you propose to have no personal income tax.

 

While some small businesses, mostly sole proprietors, follow the flow-through model, most people who run businesses, own rental properties, or even one-man shows to which assets are attached do take advantage of more complex corporate structures. This is because the tax benefits, such as deductive your salary from business expenses, are too great not to. Most people I know who run a business, and even many consultants, incorporate or form partnerships, etc. I have clients who have incorporated their new construction personal home projects to take advantage of tax benefits. I kid you not.  Its not an expensive or onerous thing to do. 

 

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Is the goal to tax the source of wealth (a tax on business, however defined) or to tax the legal structure (corporations pay tax, but proprietors and partnerships do not)? 

 

 

First, there is more than one partnership structure. Some are pass through and some aren't. With that said, the goal is to tax the wealth generated after expenses are paid, including salaries. To understand the underlying theory I suggest reading Capital in the 21st Century by Thomas Picketty. His analysis is rigorous and he conclusively shows (IMO) that we have come to a point where the income earned by working people is increasingly dwarfed by the self-generating income of those who possess sufficient capital that they don't have to. This is happening at an ever accelerating pace. Hence our contemporary discourse about income inequality and the concentration of increasing wealth in the hands of the few. The old assumptions we have about where wealth comes from and how capital perpetuates itself are increasingly "out of date."

 

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Determining a "reasonable salary" for any given contribution of labour is also no mean feat. 

 

No disagreement, but just because something is difficult, doesn't mean its impossible or that it shouldn't be done.

 

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Each issue creating new challenges and making the system more complex, but differentiation is certainly possible.

 

At present the US federal tax code is 74,608 pages long. I'm not sure these changes would actually make it any more complex that it presently is. It could be more complex, just as complex, or less complex depending on how you go about it. 

 

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  At the core,. I find a major challenge is that a corporation's income can be accessed in two ways.  It can pay dividends, or its shares can be sold.  These are simply two different means of accessing the same value.  Taxing them differently creates a bias to one approach over the other.  As a very simple example, let's assume our truck driver corporation accumulates $100,000 a year.  After 40 years, the truck driver retires.  There is now $4 million in the company (ignoring return on the reinvested funds).

 

Should his tax be different if he takes dividends over a 25 year retirement than if he sells his shares?  Let's add another wrinkle - perhaps his company invested funds to create a pension for him, the key employee.  Should he be taxed differently on that source of retirement income? 

 

The US tax code already excludes pensions and related dividends from earned income while simultaneously taxing them differently than other capital gains. And, yes, if you own shares that pay dividends and then turn around a sell them, you pay the full capital gains tax. As a result, I don't see this as a challenge as we already do it this way. I see no reason why this would need to change.   

 

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What if he had taken the annual $100k as extra salary, or as dividends, and invested it personally to fund his retirement?

 

All of these use the same funds for the same purpose.  Is one approach beneficial, or detrimental, to society as a whole, supporting the notion that it should receive more favourable, or less favourable, treatment from the tax system?  If this is your retirement, being taxed at 0% or 70% would seem a very significant issue.

 

As noted above, we have already created tax structures to facilitate retirement and exclude them from the regular capital gains rates. Those structures already have limits to how much you can make use of before having to pay capital gains on what you draw beyond that. It is, in theory, a very significant issue, but its one we've already hammered out for the most part. Raising the capital gains tax does not necessarily mean a retired person, let's call her grandma, suddenly finds her pension and dividends crushed by a high tax rate. The structure already makes a distinction between grandma and Warren Buffet, even though he's a grandparent. ;) 

 

I would note Buffet, incidentally, is one of the strongest proponents of jacking up the capital gains tax as a means of increasing revenue and paying for programs while at the same time lowering (but not eliminating) personal income tax.

 

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BTW, I am skipping over a lot of comments, simply because I see little to add.  For example, the clarification that you are discussing funding Federal costs, and leaving sales and property taxes to more local levels.  Although we then have to consider which services are available where, and funded how.  For example, if education is a State service, why would I not wish to reside in a state that provides public education at a high level until my education is complete, then move to a state where taxes are limited, and education less funded, now that I have my own skills to command an income?  That's an issue often raised in international tax matters - the "brain drain".

 

This is an already extant feature of the landscape in the US. Different states have different tax bases and structures, and different programs and services. There are even differences between counties and cities, who have their own taxes, fees, and programs. Indeed, your example of schools is one of the best ones. Only a modest amount of school funds flow from the Fed and even then, some districts reap more rewards than others. Most education funds flow from the individual state governments, counties, and even municipalities. Local education levies, as well as levies for police, fire, libraries, and other services are things we vote on at the local level in almost every election. 

 

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Gotta run...you hit two more issues above.

 

Why should your daughters get houses tax-free when my kids either inherit nothing and must build their own wealth, or built their own wealth, bought their own homes and now inherit some other form of wealth?  I agree with your statement - "I don't know" - knowing what is fair is no easy task.

 

As I said before, "I don't know." There are frequently times I am content to let experts decide.

 

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Finally, the problem often is that the electorate each wants a system which gives them more value in benefits than they pay in taxes,  We all know that this math is unworkable, but we are often alll too happy to accept the promise of getting more out than we put in when we stand at the polling station.  Or at least a majority of us are - enough to win the election.

 

Agreed. That was the point of my Thomas Sowell quote about scarcity. We are rapidly approaching the critical and painful point where we have to decide between eventual insolvency or reduced and more disciplined spending.

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33 minutes ago, Lord Liaden said:

With all the concerns over hacking the computer voting system, I wonder if it would be practical to return to paper ballots for the upcoming November elections?

 

"We shall cleave to the old ways: cover of darkness and speed of hoof!" - King Arthur, Excalibur.

 

Some matters are so consequential that integrity and security must trump speed and convenience.

Voting is one of those things where I'm willing to do a little more, wait a little longer, and fund a little stronger.

Electronic and online voting are very modern and efficient, but the security is not yet robust enough for comfort.

In Washington we receive ballots in the mail and return them the same way. 

Insofar as we aren't engaging in ballot-tea-reading and trying to discern the intent of hanging chads, I can wait.

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3 hours ago, Lord Liaden said:

With all the concerns over hacking the computer voting system, I wonder if it would be practical to return to paper ballots for the upcoming November elections?

 

This is what computer security people have been screaming about for like a decade.

 

My field:

 

https://xkcd.com/2030/

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The National Mall is center stage of our democracy. It is maintained by our tax-dollars. I have no issues with reasonable fees for special events like weddings and concerts, but for political protests? The government does not get to charge The People for the right to make their opinions known on their own front doorstep; and especially not by executive fiat. If it were any other national park I might not feel the same way, but the location of the national mall and the number of defining historical mass protests that have occurred there make it qualitatively different. No. Just no.

 

https://reason.com/blog/2018/08/09/demonstrators-might-have-to-pay-a-fee-to

 

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Hmm.  There are a number of groups headed to DC this Sunday to stage a "rally" in commemoration of the Charlottesville anniversary.  It's fair to say they will be outnumbered by Capitol Police 3:1 and counterprotesters around 30:1.  The locus of the rally is supposed to be Lafayette Park, in front of the White House.  Is it possible that there are ideas so reprehensible to reasonable public sensibilities that the mere utterance of them in a public space constitute "fighting words", or, alternatively, de facto incitement to riot/violence?  

Optimistically, it's an opportunity for 45 to have a do-over and make a clearer distinction as to which persons, on which side, are "very fine people".  

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If we’re really lucky maybe he’ll join in personally and get caught up in the festivities. 

 

Given the histories involved, the wearing of white hoods and the flying of Nazi flags constitute threats and should be controlled on that basis. 

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3 hours ago, megaplayboy said:

Hmm.  There are a number of groups headed to DC this Sunday to stage a "rally" in commemoration of the Charlottesville anniversary.  It's fair to say they will be outnumbered by Capitol Police 3:1 and counterprotesters around 30:1.  The locus of the rally is supposed to be Lafayette Park, in front of the White House.  Is it possible that there are ideas so reprehensible to reasonable public sensibilities that the mere utterance of them in a public space constitute "fighting words", or, alternatively, de facto incitement to riot/violence?  

Optimistically, it's an opportunity for 45 to have a do-over and make a clearer distinction as to which persons, on which side, are "very fine people".  

 

The Klan and Aryan Nations and other such groups have all won lawsuits over permits and their right to gather, march, and rally despite local opposition in places they wanted to be provocative reprobates. I still live by the premise "I find your views utterly reprehensible, but will defend your right to express them." The first amendment is too important to shut down simply because we find a person and their views hateful, repugnant, or unsettling. Insofar as its not tantamount to yelling fire in the public square, and doesn't cross the line into harassment or assault, I think they should be allowed to gather, even right in the heart of our republic, and do their hateful thing. Indeed, I would much rather they air their views loudly in public where who they are and what they think is laid bare. Under those circumstances they and their ideas can be called out, debated, and defeated in the marketplace of ideas. And, quite honestly, as vile as many such people and their views are, if our values and ideas are better we should be able to beat them squarely on our merits in the public square, right? If they are forced underground they become more dangerous, in my opinion. 

 

I'm just a middle aged white man, but in 1977 the Klan burned a cross in our front yard because my parents agreed to sell their home to a black family. I was five years old. I remember the men in hoods, the burning cross, and the very real armed East Texas stand off. I remember the sheriff coming, doing nothing, and driving away. I remember them threatening to lynch me and my dad. Its burned into my mind to this day and has played a very real role in forming who I am. My parents ultimately called the family, told them the situation, and let them decide whether they wanted the house or not. I also remember my parents and the people who came to support them, being willing to go down fighting on  principle if they did decide they wanted the house. In the end, the family chose to buy another house and the situation eventually diffused. The reason I bring this up is that those men lived on our street, went to the local churches, and even worked in the same plant as my father. Even today, four decades later, my parents are surprised at who some of those men turned out to be.  

 

I would much rather know who these people are and what they believe and confront them in Lafayette Park face to face than to only find out who they are in my front yard when they've already put their hoods on and grabbed their guns for a lynching. 

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1 hour ago, Old Man said:

Given the histories involved, the wearing of white hoods and the flying of Nazi flags constitute threats and should be controlled on that basis. 

 

It really depends on the context. There have been permitted marches where those things have been present and they weren't deemed threats. That some people find something threatening doesn't mean it rises to an actual threat under the law. It depends on how the judges apply the reasonable person standard. For instance, in Washington State, the police used to routinely arrest people for disturbing the peace, or threatening behavior, for openly carrying a firearm (even though we are an open carry state). The state supreme court ultimately ruled that "a reasonable person is not threatened by a fellow citizen exercising their constitutional rights." At the same time, they clarified, that the totality of circumstances would be weighed very differently because of the presence of a firearm. In other words, if you are walking around with an firearm on your hip, you need to speak softly and mind your Ps and Qs. I could make arguments for why a large protest with the items you note could easily cross the line into being a threat under the law (it really wouldn't take much), but I wouldn't automatically assume they do.

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