More sensible would be some workable flat tax built by someone smarter than me. Perhaps a flat 6% with no deductions no matter what you earn?
There was an interesting debate in Parliament before the Revolution where it was in essence argued that landed estates do not pay fair taxes, when the consumer pays a tax on their drink at the pub but the landed estate owner pays no tax on his consumption.
Keeping that in mind, I did the calculations once when a newspaper published the net worth and tax returns of several rich people; the paper I wrote on it was destroyed during a hurricane, so this is what I remember (general range for Dole and Isackson):
$250,000,000 temp agency owner running for Governor, was paying .75% of his net worth in taxes. {In one of the years listed he paid absolutely no income tax, yet the government continued to protect his net worth from the barbarian horde that would pillage it, I had to work to eat.}
Bob Dole was paying about 1.75% of his net worth in taxes.
Johnny Isackson whose net worth was less than Bob Dole was paying about 2% of his net worth in taxes.
I was paying 3.75% of my net worth in taxes, with a net worth of about $80,000.
The flatter the income tax the worse the calculations turn out, that is due to the fact that many rich people do not have as much of the majority of their net worth in Real property like they did during the age of landed estates.
According to the nature of things income put in the wallet is no different than the net worth in the wallet.
Logic dictates that Income can have more than three years of plenty and more than seven years of lean. That is the reason for income averaging, but it is only for a short time.
Logically the person who sees ten years of plenty for a progressive punishment and then sees ten years of drought gets punished by progressive taxes, like actors in a 99.9% income tax bracket, so now that we have fixed it the flat income tax crowd knee-jerks for more. The lucky guy who had the steady stream of income is not punished by progressive taxes.
If you want a flat income tax on income to the wallet, why not just do away with the ups and downs of progressive income punishment and have a flat net worth tax on the wallet, with one deduction up to $200,000 of net worth for the principle residence? That would give everyone the exact same flat tax and the exact same deduction; isn‘t that more fair than a flat income tax that makes you sweat to pay the insurance on the rich man‘s estate when he has no income?
You said: “’This is all because Bill Clinton made us loan money to minorities.’ This is ridiculous.”
You are 100% true on that. It was good for rhetoric, for the ignorant, but not good at making laws to fix the problems.
Congress sets goals for the Fed and when Republicans had both houses they saw no problem, and like I quoted Greenspan from 2004 (on page one) he saw no problem, but we blame Meeks, Waters, and Frank for in 2005 seeing no problem. As far as I know only Meeks was man enough to repent without any prodding. I think we may need some cattle prods to get the Republican party to repent. Maybe eight years of Obama putting them in retreat will make them see the light.
Although deficits were created to fight wars, and the British kicked French butt to prove it, we are in a potentially endless kind of war making deficits stupid. We are at war in the oil basket, the economic oil pan, running up a debt after breaking the Newt/Clinton agreements to balance, and we could not change the oil without a National Energy Policy (we could not get because neither side would compromise on Alaska). Having an economic downturn was inevitable. War is a fluid situation especially when your supply lines are tenuous.
If you had all the old US News and World Reports, or a library with them, I would say look for a last page article during Jimmy Cotter Pin on the S&L’s, and what they predicted. It can be good rhetoric to blame the S&L crisis and the current Mortgage crisis on Jimmy Cotter Pin, when we are innocent, but Republicans are not innocent and neither are the businesses.
Without addressing the laws, the bailout to increase credit is like a bucket with holes in it and you are poking more; the worker sweats, the usurer gives him more debt than he can handle without laws to stop it. In normal downturns, food and gas go up, hours get cut, and the usurers come out smelling like a rose if they can survive long enough to sell all those bank owned properties the government subsidized. The little guys the banks fracked mercilessly due to irresponsible business practices literally must pay for the bank’s continued wealth and stable net worth.
Government offering to help homeowners without putting a choking collar around the neck of every usurer (using Shakespeare's definition) is like a beautiful sadist tying the homeowner up for sex then letting the dog eat him.
