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 Post Posted: Fri Jan 28, 2011 11:45 am 
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OldCrow wrote:
But I'd be curious to know which other countries you'd rather be in and why (well, except Canada...that's a given, heh, heh).

At a general level, I'd like to live in a country where I get the feeling the government and most citizens actually give a crap about their fellow citizens. We actually do have ways to measure that sort of thing - measures like income equality, standard of living and (in inverse correlation, obviously) poverty rate. Countries like Sweden, Finland and Iceland all do quite well here.

I also want to live in a country that gives a crap about its future. This can be seen largely through investment in long-term goods: transportation infrastructure, education, energy, that sort of thing. Now, I know the President just talked a lot about doing these very things, but the unfortunate reality of our political system here means the President actually has no authority whatsoever over these things, and people in this country can't be assed enough to install a Congress that cares. Half of the country doesn't give enough of a crap to even vote - that's how utterly broken our political system is.

And that's the central problem. I want a country with a political system that actually works. At this point, I really don't know that ours can be salvaged without being rebuilt from the bottom up (and we can't do that because the system is so totally broken already.)

To be honest, I'm not entirely unconvinced that Egypt and Tunisia don't have the right idea.

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 Post Posted: Fri Jan 28, 2011 11:52 am 
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Careful, FB, you're sounding Jeffersonian. With a bit of mountain militia mixed in.

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 Post Posted: Fri Jan 28, 2011 12:14 pm 
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Ever think that maybe the problem is that you shouldn't be installing a Congress to try and fix those things? Maybe it's a lot easier for people in Georgia, for example, to get a sense for whether Atlanta cares about them than Washington. And on the flip side, I imagine it's a lot easier for Atlanta to care about Georgians than it is for Washington.

Not to mention that Atlanta might have a better idea of what Georgia needs in terms of infrastructure, roads, education and so on.

I think that most people seem to forget that cries for dismantling large arts of the Federal Government in the US also implies that many, if not all, of those functions would devolve back down to the states - where they would be closer to the people directly affected by them.

Beyond that, I don't think you'd find the Scandinavian countries quite as much to your liking as you think, in economic terms. The US actually has a much more progressive tax structure than most of them, for example. There's one of those oft quoted figures to the effect that in the US 1% of the population holds 20% of the wealth (or thereabouts). They also pay something like 45% of the taxes, many of which are transferred to those who pay less. In Sweden (I think), they pay pretty close to bang on 20% of the taxes.

Not that income equality metrics mean much to begin with, in any case.

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 Post Posted: Fri Jan 28, 2011 4:12 pm 
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OldCrow wrote:

Beyond that, I don't think you'd find the Scandinavian countries quite as much to your liking as you think, in economic terms. The US actually has a much more progressive tax structure than most of them, for example. There's one of those oft quoted figures to the effect that in the US 1% of the population holds 20% of the wealth (or thereabouts). They also pay something like 45% of the taxes, many of which are transferred to those who pay less. In Sweden (I think), they pay pretty close to bang on 20% of the taxes.



If everyone owns 100 Currency Units, but the richest 1% of the population, who earn 101 Currency Units, then in any sane tax system theese 1% will not pay 45% of the taxes. You can't use that as argument that a country where this is the case, has much ecconomic inequality. Now i don't know ecconomic data of Sweden and the US, to know for sure if this argument fits the case, but as it stands your argument does not seem to make sense.

Regarding solving matters on statelevel. With how many issues are there any federal regulations that forbid the states to solve matters there? So if even none of the deepest blue states were able to install them paralell to any non working federal programs, why assume they can do if there are no federal programs?

And some cases do have a lot more collateral effect if done on statelevel. If a deep blue state would install universal health care, pretty much anybody who needs expensive medical care would move there. Which means that state would need to find the money for universal health care for the whole US alone. Or they would need all sorts of rules not only preventing citizens from other states from using their services, but also preventing migration from other states, so they don't get all people with chronical illnesses. Which all would have their own sideeffects and would also defy the purpose of living in a union.

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 Post Posted: Fri Jan 28, 2011 6:15 pm 
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If everyone owns 100 Currency Units, but the richest 1% of the population, who earn 101 Currency Units, then in any sane tax system theese 1% will not pay 45% of the taxes. You can't use that as argument that a country where this is the case, has much ecconomic inequality. Now i don't know ecconomic data of Sweden and the US, to know for sure if this argument fits the case, but as it stands your argument does not seem to make sense.

That's not the argument I was making. I was suggesting that FB was likely assuming that the Scandinavian countries would have a more progressive tax than the US in order to "correct" income inequalities (the fact that some people earn more than others). I was therefore also suggesting that since they don',t in fact, have a more progressive tax regime that he would find they didn't live up to his expectations.

Of course, this also implies that if the Scandinavian countries are appealing (from a socialist point of view) despite having a relatively non-progressive tax regime then maybe arguments about the necessity of income redistribution are inherently flawed.

Of course, this was based on my read of FB's assumptions, based on previous discussions with him along similar topic lines. As far as I can tell he views any income inequality outside a narrow range as inherently suspicious, and even something to be proactively corrected. But maybe I'm wrong, in which case I apologize in advance for making a poor assumption on my part.

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Regarding solving matters on statelevel. With how many issues are there any federal regulations that forbid the states to solve matters there? So if even none of the deepest blue states were able to install them paralell to any non working federal programs, why assume they can do if there are no federal programs?

That shouldn't be an issue in a country whose Constitution only grants the Federal Government limited and enumerated powers and explicitly reserves all other authority to the States and the People.

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 Post Posted: Fri Jan 28, 2011 6:24 pm 
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I think that is why our system appears broken. The federal government takes on so many roles that are supposed to be left to the states to decide.

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 Post Posted: Fri Jan 28, 2011 6:40 pm 
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There are means to combat income disparity that are not progressive tax structures. Minimum wage is a policy that does this, as is a culture that doesn't assume the head of the company has to be paid 400x what his employees make.

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 Post Posted: Fri Jan 28, 2011 7:14 pm 
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If people would follow Henry Ford's words it wouldn't ever be an issue.

"There is one rule for the industrialist and that is: Make the best quality of goods possible at the lowest cost possible, paying the highest wages possible."
Henry Ford

"Time and money spent in helping men to do more for themselves is far better than mere giving."
Henry Ford

"You will find men who want to be carried on the shoulders of others, who think that the world owes them a living. They don't seem to see that we must all lift together and pull together."
Henry Ford

"If there is any one secret of success, it lies in the ability to get the other person's point of view and see things from that person's angle as well as from your own."
Henry Ford


Last edited by Jorodryn on Fri Jan 28, 2011 7:33 pm, edited 1 time in total.
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 Post Posted: Fri Jan 28, 2011 7:31 pm 
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Minimum wage may "combat income disparity" among those who have jobs, but it also increases unemployment. So I suspect that tends to be a bit of a washout at the end of the day...

Anyway, I'd challenge the assumption that income disparity is either "combat-able" or even a bad thing to begin with. Certainly there's no valid reason to assume that the head of every company must make 400 x more than the average employee; however, some company heads might very well be worth that much, or even more.

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 Post Posted: Fri Jan 28, 2011 8:48 pm 
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No, OldCrow, they are not. No matter how much money they bring in, no one is worth 400x anyone else.

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 Post Posted: Fri Jan 28, 2011 9:46 pm 
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Crow, arcosh is arguing with your arithmetic. You said:
Quote:
There's one of those oft quoted figures to the effect that in the US 1% of the population holds 20% of the wealth (or thereabouts). They also pay something like 45% of the taxes, many of which are transferred to those who pay less. In Sweden (I think), they pay pretty close to bang on 20% of the taxes.


If the top 1% of the population pays 45% of the taxes in the US, but the top 1% of Swedes pay only 20% of the taxes in Sweden, that does not mean that the Swedish tax structure is less progressive than the American one.

To determine the progressiveness or otherwise of a tax structure, you need to compare the tax rates. In the US, the marginal tax rate runs from 10% for the poorest to 35% for the richest. In Sweden, according to Wikipedia anyway, the individual income tax rate goes from 28.89%-59.09%. This crudely suggests that Sweden's tax slope is a little bit steeper than the US's. Although it's not a very good comparison - to do a really good one you'd have to factor in sales taxes (which are regressive), various local taxes, and also determine exactly where each tax bracket falls in comparable purchasing power parity terms. Maybe if you add all that in Sweden's comes out less progressive, maybe not. I don't know.

But the point is, just looking at the size of the contribution of the top 1% to the total pool isn't meaningful because it tells you more about the magnitude of their wealth than about the tax system. Perhaps the reason that Sweden's richest 1% only pay 20% of the pool is because rich Swedes aren't as rich as rich Americans. Which is the point arcosh was making - if you've got a flatter income distribution curve, then under the same tax system, of course the richest 1% aren't going to be paying as big a chunk of the pool. A quick look at Forbes's list of the world's billionaires shows that 11 of the world's 25 richest people are American. Only 2 are Swedish, and 1 doesn't even live in Sweden.

As for whether inequality is a problem for society or not? Higher income inequality is strongly correlated with worse social problems in both international and US interstate comparisons (at least amongst rich developed countries). We're talking about crude measures like homicide rates, incarceration rates, teen pregnancy rates, infant mortality, life expectancy, etc.

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 Post Posted: Fri Jan 28, 2011 10:07 pm 
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FreakyBoy wrote:
No matter how much money they bring in, no one is worth 400x anyone else.

Well that's just self-evidently wrong - no skin-flinting company that gave a damn about its profits would spend more on a CEO than they needed to spend. If one of them is paying someone 400 x their average employee's salaries, then they must think that person worth the money. Otherwise they'd just find someone cheaper.

Nice wording however. I like how you chose it to subtly imply that salaries and compensation somehow equate to moral worth. It's got a sort of old school "the word of a noble is worth 10 x that of a peasant" feel to it.

But since 400 x compensation obviously bothers you, what limit of compensation is acceptable? Because, if it's anything other than equal compensation for everyone, regardless of what they do, then I fail to see how you can object to any particular amount of pay. If 2 x is acceptable for some people, then why not 6 x, in some circumstances? Why not 20 x, in some circumstances? Why not 100 x, or 1000 x? On what criteria are you setting the limit?

Kea wrote:
Crow, arcosh is arguing with your arithmetic.

Well, fine, but I never said the figures were exact. Oh and you forgot one significant factor in your list of things related to making a good comparison - the affect of tax transfers. So let me find something more concrete for us to actually argue about, instead...how about "Taxes and the Top Percentile Myth". It's probably the article that was sitting in the back of my mind when I threw out that first reference to the top 1% having 20% of the income in the first place.

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 Post Posted: Fri Jan 28, 2011 10:38 pm 
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Firstly, you're sticking to the assumption that those running companies actually care about the long-term health of the company when deciding what to pay their executives. On the contrary, so-called corporate incentive structures have turned into mutual backslapping parties, in which executives pretty much decide what to pay themselves with the collusion of board members. And as the financial crisis showed, there was an awful lot of foolish risk-taking when times were good and taking the money and running when things went south, the health of the company be damned. (That's what bailouts were for).

As for your article, I don't think I really understand what it's arguing. Most of it seems to be about the effect of raising tax rates on the tax-avoidance strategies of the rich. But I'm not sure how that's relevant to an international comparison. The argument appears to be "higher tax rates encourage more evasion, which is why the Swedish rich pay less of the pool". But it leaves out the possibility that at least part of the reason is because rich Swedes aren't nearly as rich.

It also seems to be saying "it is erroneous to use before-tax income to estimate the wealth of the top 1% and therefore how much tax they should be paying". And also "the value of tax transfers should be factored into the incomes of the bottom n% of the population before deciding how unequal a society is".

Well, the first part doesn't seem to make sense, because why on earth would a government use after-tax incomes in deciding where to set tax rates? That sounds like a recipe for nightmarishly recursive accounting - like standing between two mirrors. As for the second point, you can go ahead count the value of transfers, but only if you do it for all the other countries you're looking at too. If you factor what poor Americans receive in child tax credits and whatnot, then you should also factor in what poor Swedes are receiving in subsidized health care and free university education.


Last edited by Kea on Fri Jan 28, 2011 11:24 pm, edited 1 time in total.
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 Post Posted: Fri Jan 28, 2011 10:43 pm 
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No one needs to make 10 million dollars. It's just excessive. And if you cap things at a reasonable salary - I really don't see the justification for anything larger than a million, frankly - then you get ratios that are sane.

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 Post Posted: Fri Jan 28, 2011 10:50 pm 
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FreakyBoy wrote:
No one needs to make 10 million dollars. It's just excessive. And if you cap things at a reasonable salary - I really don't see the justification for anything larger than a million, frankly - then you get ratios that are sane.


The problem is that goes against general human nature toward equating money with success.

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