On 08/14/09 09:22, Warp wrote:
> Neeum Zawan<m.n### [at] ieeeorg>  wrote:
>>          It's a question of rates. In the US, the percentage of the overall
>> wealth owned by the top 1% keeps increasing (depending on who you ask -
>> I'm seeing some contradictory figures). That's a net flow in that
>> direction.
>
>    Is that a bad thing? I'm asking that seriously.

	Perhaps not - as long as the rest of the people's wealth doesn't go down.

>    A bit of balance between rich and poor can be achieved with progressive
> taxing (ie. tax rich people with a higher percentage than poor people),
> but that's a dangerous path to follow too far. If you punish rich people
> too much with heavy taxes, the economy of your country may suffer. On the
> other hand, if people are rewarded for succeeding (in the form of allowing
> them to become filthy rich), that may actually improve the country's economy.
> People who know how to make money circulate will want to succeed in that
> country. If the country imposes heavy penalties on them in the form of taxes,
> they may well move to another country and improve that country's economy.
	
	Progressive tax is simply finding the right level. However, the current 
rate for the rich in the US is lower than the norm in most European 
countries. And then there are loopholes to exploit to pay even less.

	But let's talk about the progressive tax in the reverse direction. Do 
you think rich people should pay _less_ tax than the ordinary person? 
That's the direction both Clinton and Bush went. See the following:

  http://www.timesonline.co.uk/tol/money/tax/article1996735.ece?print=yes

	I believe he even offered something like a million dollars if any of 
the 400 paid the same or more taxes (percentage wise) as their 
secretary. As far as I know, he didn't have to pay it.

	(And just as an FYI, if you look at the tax rates for the rich in the 
US during the 20th century, they used to be *much* higher - and yet 
people whine a lot about tax increases now).

>    Is there any rational reason to punish rich people with heavy taxes,
> other than jealousy and a generic sentiment of "fairness"?

	Well, yes. Jealousy and fairness have little to do with it. Ultimately, 
you have to look at the purpose of taxing to begin with. If a country 
needs to collect a certain amount of money, and they decide to do it 
using a flat tax, it may become too onerous on the poor and perhaps even 
the middle class. So they have two choices: Drop a lot of government 
programs, or tax more those who won't get hurt much by taxes - and 
that's the rich.

	It's all an optimization. Tax too much and things will go downhill. 
Give everyone an equal tax, and it may go downhill there as well.


-- 
I don't suffer from insanity, i enjoy every waking moment of it.


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                                    anl

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