If anything inflation only makes matters worse for people who weren't careful enough to save and invest in assets(like land) early on in their life.
If you're trying to suggest that higher income socialists won't like it if they're the ones being taxed, then I don't think you understand socialists.
"Doctors, lawyers, and IT people making low six figures" have absolutely nothing to fear. And for the extremely few fortunate people who actually make more than half a million dollars each year, they will easily be able to afford the new taxes.
Have you noticed that most tax deductions that are designed to help the middle class phase out in the $120 - $160K?
Yep.
Most people are perfectly capable of distinguishing between a middle class 2 bedroom house and someone who owns 15 vacation homes, a private jet, and private islands.
The real question is whether or not middle class people will punch down and behave as if no one can distinguish between a multi billionaire and and a normal middle class person or whether the middle class will refuse to let the billionaires put all of the stress on the middle class.
How many people making the median household income of $60K a year will object to a politician saying tax everyone extra making a household income of $116K- the top 20% of household income?
That’s fine. Since we have a free market economy, someone else who wants that money more than you will do it instead.
On the other hand now that my marginal tax rate would be 33.6% (2018 Tax rates) since I'm already over the social security maximum from my primary job, it's much more attractive.
My wife would have jumped at the chance to make an extra work at $15 - $20 an hour (W2) when she was single, now at our combined tax rate, it's not even worth it. We are thinking about her working part time. The main reason she is working at all is for the health benefits that give me the opportunity to aggressively jump between contract, full time, unstable startups, and stable corporate jobs.
Taxes make a difference on how much someone is willing to work, especially if they make enough to be comfortable.
Firstly is your sole motivation for your business financial? Because if so you may as well sell it, buy property and let it out, you'll earn a comfortable living and if you use a letting agent you can get them to deal with the renters and do almost zero work, bar having to file taxes once a year (and hey you can get an accountant to do that for you). Even ignoring that, is your business something that actually generates a lot of profit or are the margins small? Whatever you're doing you could invest the time into an ICO and make millions. Point I'm getting at is that very few people start a business solely for financial reasons, there's usually some level of passion involved.
Secondly, why exactly would a high tax rate stop you expanding completely? You'll still be earning money, just less than before. And as the other commenter pointed out, someone else will step in if you don't, which could threaten your business.
You really think that the average small business person working from themselves are doing it out of "passion" rather than that's their best alternative? Many small business owners work as much as possible to avoid having to pay someone else, hardly ever take vacations, and if given the choice, I'm sure would rather work in a nice comfortable white collar job if they could make the same amount of money.
https://theoutline.com/post/2303/megan-mcardle-has-a-lot-of-...
However, to answer some of these points:
1) With respect to healthcare, investopedia has different numbers than the ones she cites: https://www.investopedia.com/articles/personal-finance/08061...
Some of the savings we posit from healthcare can be used to pay for other programs.
2) Eliminate Imperialism - Save > $1T dollars by not fighting wars based on lies. The Pentagon's budget was recently raised by about the amount a version of free college education would cost.
3) Tax the (Natural Person) Rich - Take their giant chunk of change and use it to buy more stuff, like infrastructure
4) Eliminate the Rentier Class - Housing is suddenly cheap and ordinary people have much more pocket change. Who will be incentivized to build housing then? Well, your representatives of course.
5) Tax the Tax Evaders - Apple, Google, and all the rest that use tricks to hide billions overseas (or have it parked here after the tax bill).
There's lots of money to find, just look under the couch.
That's an ad-hominem attack that has nothing to do with the substance of this discussion. How about sticking to the actual numbers?
> 1) With respect to healthcare, investopedia has different numbers than the ones she cites
Let's assume the investopedia numbers are right (though it's not clear why their uncited administrative costs number is more authoritative than an OECD report on administrative costs). They claim 5% of GDP in administrative costs (25% of 20%). The drug numbers they mention as being "saveable" are $11.6 billion per year; that's .0006% of GDP. No other numbers are cited for drugs there. For defensive medicine, .03% of GDP. For the other items, no numbers are given.
So we could potentially spend about 5% of GDP less on healthcare; the other bits all look like rounding error on that. I used $19.39 trillion for the current annual US GDP, fwiw.
And just to be clear, the actual US federal government spending on healthcare is about $1 trillion a year, or maybe 5-6% of GDP, as far as I can tell. The remaining 14-15% of GDP is spent outside the federal budget already. If we're trying to put it in the federal budget that means raising taxes by 9% of GDP or so.
> Eliminate Imperialism - Save > $1T dollars by not fighting wars based on lies.
This would definitely be nice, but that doesn't seem to be what most people propose. Again, the context is people proposing "just tax the 1%".
> Tax the (Natural Person) Rich
Right, this is the thing under discussion: taxing "the 1%". The total income of the top 1% is something around 20% of total personal income according to https://www.epi.org/blog/top-1-percent-receive-record-high-s... and total personal income is around $16.5 trillion according to https://www.statista.com/statistics/216756/us-personal-incom...
So if we taxed away every single penny "the 1%" earn, that gives us 16% of GDP. That's assuming that there are no disincentive effects, emigration, etc, etc. Probably a bad assumption.
> Eliminate the Rentier Class
I'm not sure what your actual proposal is here, but at this point I suspect we're way outside the realm of the politically feasible or desirable. That said, can you quantify this, please?
> Tax the Tax Evaders
I would be very much behind this idea. Again, this is not the same as "just tax the 1%".
Anyway, last I checked US government spending (including all levels of government) was about 37% of GDP. If we add the very optimistic 16% we can get by taxing "the 1%" we get to 53%. That's still less than France or Finland or Denmark spend. Yes, we could nationalize healthcare if we did that, fairly easily. We couldn't do all the other things people want to do by "taxing the 1%".
I agree that if we radically restructured everything about how the government is funded and what we spend money on then there are a lot more options. But, again, what people tend to propose is "just tax the 1% and use that money for X, Y, and Z". And there's not enough money in that bucket to do all those things.