From: robert@slipknot.rain.com (Robert Reed)
Subject: Re: VOTE, BABY, VOTE!
Organization: Home Animation Ltd.
Date: Fri, 6 Nov 1992 07:40:59 GMT

<1992Nov4.203546.7171@colorado.edu> <1992Nov5.031802.13498@ucsu.Colorado.EDU>
Reply-To: robert@slipknot.rain.com.UUCP (Robert Reed)
Organization: Home Animation Ltd.

In article <1992Nov5.031802.13498@ucsu.Colorado.EDU> fcrary@ucsu.Colorado.EDU
(Frank Crary) writes:
| These are a reletively [sic] trivial expense, except for interstate highway
| funds. These, however, benifit [sic] everyone more-or-less [sic] equally.
| (Even if the poor don't drive much, which isn't the case, they buy just
| as many goods shipped on the highways.)

Doubtful.  The poor generally spend less on any category you choose to name,
including food, clothing, building materials, and discretionary purchases.  The
transportation of most of these items are benefited by our interstate highway
system and federal air traffic control system.  Such decreased transportation
costs make possible such things as the vertical integration of the poultry
industry, which does disproportionately benefit the poor in terms of lower
prices, but also profits the employers much more than the employed (working
poor) in this industry.  Those with more discretionary income often choose
local brands for "health" or "perceived quality" reasons.

| (One reason, by the way, that medical costs are so high is the excessive
| and pointless levels of required testing: The drug companies have to
| charge alot [sic] to cover these costs.)

And so you prefer less testing and increased probability of such "medical
miracles" as Thalidomide and Halcion?

| Titles and licences are the mechanisim [sic] by which the government collects
| a whole series of additional taxes, but they produce very little
| benifit [sic] to the title holders of [sic] licencees.

Well, titles DO provide one way of enforcing auto ownership, by establishing an
independent arbiter over ownership issues.  And licenses DO correctly identify
vehicle operation as a privilege, not a right.  That enables defenders of the
public peace to deny that privilege to operators who have proved themselves too
irresponsible or incompetent. 

| All the services you mention cost orders of magnitude less than the
| over $100 billion spent on the poor by the federal government. It 
| doesn't seem like the rich are getting more out of it...

Let's see, $100 billion for the poor, out of a federal budget estimated this
year at 1.4 trillion.  Some of this $100B will benefit the rich through
"trickle-up," by attempting to reduce the poverty which serves as an impetus
for crime, which raises interest rates, which raises the cost of doing
business, which benefits the rich.

Of the $1.4 trillion, 22% will go to military spending which, along with
supporting our troops in all their far flung locales, fuels the military
procurement industry which, besides providing us with $400 hammers and $600
toilet seats, has had various branches of the military separately develop
ultimately very similar instruments of war such as certain aircraft, lining the
pockets of a lot of very rich people.

Of the $1.4 trillion, 15% will go to mandatory spending, principally federal
deposit insurance and national debt interest.  Federal deposit insurance (plus
the trillion or so additional federal spending approved by congress) has footed
the bill for the savings and loan bailout while most of the perpetrators of the
risky deals which fomented the catastrophe, having lined their pockets, get off
scott free.  We have such a national debt interest because our polititians,
caught between the money chase for special interests clamoring for their
particular line items, and their constituencies, who don't want to pay higher
taxes for the services they receive, took the easy way out, deficit spending.
So the moneyed interests get their gilt and all of us have to pay.
Of the $1.4 trillion, 46% will go to entitlements, which include Social
Security, Medicare, veterans benefits and the Commodity Credit Corporation.
None of these programs constrain their benefits by ability to pay, so the rich,
up to the limits imposed by these programs, benefit as much as anybody, while
the poor, not having the income to "max out" on social security payments,
reasonably get less of a benefit.  The Commodity Credit Corporation provides
price supports for dairy, wheat, etc., artificially inflating the cost of such
commodities while lining the pockets of plenty of rich farm corporations.  They
also provide disaster assistance--that is, a premium free insurance program for
farmers.

Of the $1.4 trillion, 15% goes to Domestic Discretionary Spending, which
includes Head Start, veterans' hospitals, highway construction and maintenance,
college financial aid, environmental cleanup, food inspection, law enforcement
and elderly and low-income housing.  Head Start directly benefits the poor, but
it also reduces subsequent education costs, benefiting us all.  Environmental
cleanup includes such things as the superfund, where corporate polluters often
manage to get the government to pay at least a portion of the cost of cleaning
up their messes (after a suitable time of litigation so that the pollution
really gets engrained in the environment), thereby increasing their wealth.

| >Exempli gratia -- George Bush can afford to maintain a legal
| >residence in a Texas hotel room to avoid Maine income tax.
| 
| I don't suppose you have a reference on this? If that were Bush's
| intention, he could claim to be a Texas resident living, temporarily, in 
| Washington D.C. for job purposes. He also, as I recall, owns
| property in Texas, so he could use that as his residence, if all he
| wanted was Texan residence for tax purposes.

Bush's hotel residence in Texas has been in the press enough, I'm surprised not
everyone has heard about it, or about how he shelters his income by maintaining
it.
 
 | >Despite the increase in the percentage
 | >tax rate, most of the really rich pay less than the "official rate" in
 | >taxes by playing games with their income that the poor can't.
 | 
 | The "official rate", including capitol gains and local taxes, is
 | around 70%. If they could get out of a full half of this, they 
 | would still be paying far more than a poor person. This is, by
 | the way, another advantage to flat taxes: There are no loopholes,
 | so you can't use tricks to get out of paying.

Hardly.  The highest federal tax bracket this year is %31.  Above $158,000 a
small tax surcharge is applied.  Social security payments for the self employed
are another %15 (capped at $130,000 at which point the rate is %8).  Oregon,
which has been declaimed as having one of the highest state tax rates, this
year has %9 for its top bracket.  Last year's capital gains tax, which is paid
in lieu of federal taxes, was %28.  So the highest number I get for an upper
middle income person is 31+15+8= %54.  At $130,000 this drops to 31+8+8= %47.
And if you can switch most of your income to capital gains, this drops to %44.
None of these comes even close to your %70 estimate.
________________________________________________________________________________
Robert Reed                     Home Animation Ltd.             503-656-8414
robert@slipknot.rain.com        5686 First Court, West Linn, OR 97068

What a waste it is to lose one's mind, or not to have a mind is being very
wasteful.  How true that is.
--Dan Quayle, addressing the United Negro College Fund, May 1989
________________________________________________________________________________

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