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"Spread the Wealth"

"Spread the Wealth". That sounds something like I would say to a friend of mine who just opened up a box of Cheez-its.  "Hey man, spread the wealth and pass me some cheez-its". 

However, this phrase also appears to be Barack Obama's tax policy.

Obama to Plumber: My Plan Will 'Spread the Wealth Around'
Audio and Video

I for one am glad Barack Obama has finally come out and said in plain English what we've known all along; he wants to turn America into a socialist country.

The alarm should have gone off for most Americans when Barack Obama started stating he would "cut taxes for 95% of workers and their families". 

Pray tell, Barack Obama, how you will cut taxes for 95% of American workers when anywhere from 33-40% of Americans don't pay ANY income tax.

Barack Obama's "tax cuts" for lower class families are really handouts. Handouts taken forcefully from higher income earners. 

Please explain to me how this form of welfare is good for our country.  The problems with taxing people to "spread the wealth around" are numerous. These problems include causing people to think that they are entitled to a certain living standard whether they work or not and removing motivation to be generous in one's charity. 

Joe Biden calls paying high taxes "patriotic".  He sees it like giving to charity.  That makes sense of his charitable giving then. Looking at the ten-year total of Biden’s giving, one percent would have been $24,500. One half of one percent would have been $12,250. One quarter of one percent would have been $6,125. And one eighth of one percent would have been $3,062 — just below what Biden actually contributed.

But it's ok, because he paid his taxes, right? Wrong. Someone who makes as much money as Joe Biden giving about one eighth of one percent of his income to charity is absolutely terrible. What's the average? The average American gives about 3.1% of their income (before taxes) to charity.  The people that give the most actually make the least. Households earning under $10,000 a year -- far below the poverty line -- gave 5.2% of their income to charity.

There are many people who don't see a problem with Barack Obama's proposed socialism.  They say that "it's time for the rich to do their share."

Oh really?

Looking just at the percentage of total taxes paid:

Taxes paid by highest incomes

  • The top 1% pay 22.7% of taxes.
  • The top 10% pay 50% of taxes.
  • The top 20% pay 65.3% of taxes.
  • The top 40% pay 84.3% of taxes.

Taxes paid by lowest incomes

  • The bottom 20% pay 1.1% of taxes.
  • The bottom 40% pay 6.1% of taxes.

And if we look at taxes paid as a percentage of income:

"Recent calculations by the Congressional Budget Office of U.S. tax rates show a highly progressive system. (The numbers are based on 2004 data, but the tax code has not changed much since then.) The poorest fifth of the population, with average annual income of $15,400, pays only 4.5 percent of its income in federal taxes. The middle fifth, with income of $56,200, pays 13.9 percent. And the top fifth, with income of $207,200, pays 25.1 percent.

At the very top of the income distribution, the CBO reports even higher tax rates. The richest 1 percent has average income of $1,259,700 and forks over 31.1 percent of its income to the federal government."


For those who still don't get it, I'll conclude with a nice little story I heard on the first day of my first economics class:

Suppose that every day, ten men go out for beer and the bill for all ten comes to $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.

So, that’s what they decided to do. The ten men drank in the bar every day and seemed quite happy with the arrangement, until 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 men - the paying customers?

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 his beer. 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.

And so 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 restaurant, 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 ( the richest) 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.





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