Progressive Income Tax

Thank you Jimtimmy for your response. I will mostly post rebuttals and closing for this round. A Fair Tax System The progressive tax is the most fair income tax method. This is because of a few reasons: 1) Improves Standard of Living Much of this I covered last round. Infrastructure can be invested in on larger scales. Plus, it reduces the income inequality in a nation, which has numerous health benefits for all! [1] 2) Rich gives back to Society that made them rich Bill Gates Sr., the father of the richest guy in the world, pointed out why a progressive tax was the better option (than not having it). He said that," Bill Gates didn't invent the Internet. [He] just used it -- to make billions. There is no such thing as a self-made man. Every businessman has used the vast American infrastructure, which the taxpayers paid for, to make his money. He did not make his money along. He used taxpayer infrastructure, [which included] the banking system, Federal Reserve, etc. These taxpayer investments support companies and wealthy investors. There are no self-made men! They owe the taxpayers of this country back a great deal and should be paying it back." [2] Remember, the father of Bill Gates said this. If you disagree with the rich on how they got rich, I seriously question your sense of logic. 3) Allows the less well off to stimulate the economy The progressive tax allows the middle and lower classes to consume more, which they do because of the economic theory of the Average Propensity to Consume - which people with less money tend to spend more of it than save. Consumption fuels 70% of our nation's economy, so a P.Tax benefits the economy in this way. [3] 4) Is the most proportional, the Flat Tax is regressive My opponent is against the progressive income tax (PIT), so he must be for the flat tax. A pure flat tax is inherently regressive, and let's less money in the economy in consumption, and reduces the burden of the already rich wealthy, who help fund this nation's infrastructure. The flat tax is purely regressive because the poor, who spend much of their money, and have little to none left over, would pay the same as the rich, who have much left over. The poor, who get much of their money, would get taxed higher than the rich. The rich pay lower rates in taxes usually than the poor because of Capital Gains and Dividends taxation, but there are exceptions. [4] [5] Economic Affects of Progressive Taxation You said that nations with a flat tax are better economically. The link was only a paragraph long, with no evidence. On the contrary, a progressive tax improves the economy. With progressive taxes, the only way to retain the bulk of the wealth created by a business is by reinvesting it in the business -- in plants, equipment, staff, research and development, new products and all the rest. Low taxes produce great excesses of negative activity as well. There is a propensity in business, and as a nation, to hollow out our businesses, and mortgage and sell off our assets, in order to grab short-term profits, which leads to downsizing, which is disastrous for local economies. So, progressive taxes help the economy by stimlulating consumption, but reduce the motive to gain short-term profits, and instead focus on long term growth. [6] Investment fueling economic growth There is no correlation between Capital Gains and Dividend taxes that lower rates = better economy. [7] [8] [9] Investment is needed. However, this is not going to depend really on tax rates unless they are really high. Investment was still high in the 1990s with a nearly 40% top tax rate. However, you also need: A strong infrastructure to maximize your return You need consumption to make your investment worth it You need to be competitive against Big Business The progressive income tax best provides these tools. With a progressive tax, the less-well off, such as small businesses, can still easily invest in expanding capacity. They are more competitive against big businesses too. Big business will not expand when they suddenly get a hundred million dollars. Big business expands with more demand, not more money. So, a flat tax system would reduce the opportunity of small business to compete, so your argument is refuted. Plus, my progressive tax system proposal is still not that tough on the ultrarich, unless you make billions a year. About marginal tax rates and incentive to work Basic economics says that in a competitive economy, the contribution any individual (or for that matter any factor of production) makes to the economy at the margin is what that individual earns — period. What a worker contributes to GDP with an additional hour of work is that worker’s hourly wage, whether that hourly wage is $6 or $60,000 an hour. This in turn means that the effect on everyone else’s income if a worker chooses to work one hour less is precisely zero. [10] More Government Revenue Tax cuts will not bring in more revenue. When the Bush Tax Cuts were implemented, the CBO estimated that it reduced 10 year revenue by at least $2.9 trillion over 10 years. Your low taxes = higher revenue is refuted as well. [11] Conclusion: My opponent has failed to provide a real case against the progressive income tax like I have suggested. The progressive tax improves opportunity for people to climb the economic ladder, for small businesses to compete with larger businesses, and the P.I.T. improves investment by small business by allowing them to expand. Income inequality is reduced compared to a flat tax, and the P.I.T. therefore improves public health. With a progressive tax, infrastructure in a nation can be improved, which leads to a healthier economic environment. It is also more fair since the rich got rich from the taxpayers. There is no evidence that by giving the wealthy tax cuts (such as with a non-P.I.T. system), that the economy improves. No evidence. I also include a video I strongly urge you to watch. Thank you, VOTE PRO!Also Jimtimmy: I challenge you to compare the GNP with the rate of taxation over the last fifty years-- for example the boom years of the '50s with their 90% marginal tax rate-- and explain that high tax rates discourage investment until you can do it with a straight face. http://www.youtube.com... Sources: [1] http://psych.mcmaster.ca... [2] Lakoff, George. Don't Think Of An Elephant!. 1st ed. Chelsea Green, 2004. p. 25-26. Print. [3] http://conceptualmath.org... [4] http://www.washingtonpost.com... [5] http://www.csmonitor.com... [6] http://www.alternet.org... [7] http://krugman.blogs.nytimes.com... [8] http://www.nytimes.com... [9] http://crooksandliars.com... [10] http://krugman.blogs.nytimes.com... [11] http://georgewashington2.blogspot.com...