Monday, October 27, 2008

Tax Policy So Simple That Lefties Will Hate It

This is why conservatives' blood pressure when people like Barack Obama yammer about taxing the rich at higher rates and spreading the wealth around to everyone else, even those who don't pay taxes.

This has been going around the Internet for a few years. I saw it for the first time the other day when mt friend, Chris, forwarded it to me.

Snopes says the authorship is not determined. So what? The message is unassailable.

* * *

Ten men go out for beer every night and the total nightly bill is $100. If they paid their bill the way we pay our taxes, it would go something like this:

The first four men (the poorest) would pay nothing.

The fifth would pay $1.

The sixth would pay $3.

The seventh would pay $7.

The eighth would pay $12.

The ninth would pay $18.

The tenth man (the richest) would pay $59.

One day, the owner threw them a curve. "Since you are all such good customers," he said, "I'm going to reduce the cost of your daily beer by $20." Drinks for the ten now cost just $80.

The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free. But what about the other six? How could they divide the $20 windfall so that everyone would get his fair share?

They realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink. So, the bar owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay:
The fifth man, like the first four, now paid nothing (100% savings).

The sixth now paid $2 instead of $3 (33% savings).

The seventh now pay $5 instead of $7 (28% savings).

The eighth now paid $9 instead of $12 (25% savings).

The ninth now paid $14 instead of $18 (22% savings).

The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four continued to drink for free.

But once outside the bar, the men began to compare their savings. "I only got a dollar out of the $20," declared the sixth man. He pointed to the tenth man, "but he got $10!"

"Yeah, that's right," exclaimed the fifth man. "I only saved a dollar, too. It's unfair that he got ten times more than I!"

"That's true!!" shouted the seventh man. "Why should he get $10 back when I got only two? The wealthy get all the breaks!"

"Wait a minute," yelled the first four men in unison. "We didn't get anything at all. The system exploits the poor!"

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill!

And that, boys and girls, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.

For those who understand, no explanation is needed. For those who do not understand, no explanation is possible.


OmaSteak said...

The only rational approach to taxation should be based upon consumption not income. The Fair Tax is the answer to "fairness" and the only way for "the people" to regain power over government. You can learn all about it at "Who is John Galt?"

Prince of Darkness said...

Here is a list of the major themes that Obama touches upon time and again during his speeches:

"1. A life free of exploitation, insecurity, poverty; an end to unemployment, hunger and homelessness.
2. An end to racism, national oppression, anti-Semitism, all forms of discrimination, prejudice and bigotry. 3. An end to the unequal status of women.
4. Renewal and extension of democracy; an end to the rule of corporate America and private ownership of the wealth of our nation. Creation of a truly humane and rationally planned society that will stimulate the fullest flowering of the human personality, creativity and talent." The source for Obama's philosophy and major campaign themes listed above can be found on the website of the Communist Party USA under their statement of principles entitled Socialism USA.

Ryan the Angry Midget said...

Leaving the country wouldn't be very patriotic would it? Plus, the Bush Administration has done such a fantastic job maintaining foreign relations, you might have a hard time finding a safe place to "drink".

Your entire "lower our taxes or we'll leave" scenario is emperically denied by the fact that we have one of the highest business tax rates in the world and yet, businesses continue to operate here. Could it be that there is more to the story than just the tax rates?