Originally Posted by
Duffman
Relating the fabricated scenario to real world taxes:
"Let’s says you have an idea that generates 10,000$ and you cannot do it alone. In fact you need 2,000 people for your idea to work. You decide to pay each of those people 2$ for their part while you keep 6,000$"
The workers are getting taxed 50 cents (25%), and the guy who came up with the idea is getting taxed $2,100 (35%). The government gets $3,100.
If the government raised the tax on the guy who came up with the idea to 45%, then he'd pay $2,700 in taxes and his workers would only need to pay 20 cents. 30 cents for them is huge. That's a 15% increase in their take home money. The rich guy is still taking home $3,300 when it apparently only costs $1.80 to live comfortably, in this scenario, so I'd say he's been well compensated. The only difference is now 2,000 other people now have a little more breathing room.
Consider the average HOUSEHOLD income is around $50k. How are you going to pay for your student loans, a mortgage, car, groceries, and insurance for yourself, let alone a family? That's the average American household. Not even factoring in savings, retirement, and any misc expenses. "Average" in America can't afford the basics. Now tell me the top 1% need more tax breaks. At least know when you're getting ripped off.
It's pretty hard to be innovative or start a new business when you can't even afford the basics without going underwater.
Thats all fantastic until you realize there’s a point where the idea guys isn’t going to assume the risks because his ROI isn’t worth the hassle. You essentially halved his potential profit so that his unskilled workers could take more money home. Well, they get to take nothing home when he decides not to pursue his idea and doesn’t hire them. It’s not a magical zero sum game.
As for the little guy can’t get ahead on $50k if he has student loans, car and house payments and so on and so forth....you’re right. You don’t get to have it all at once on that kind of income. But plenty of Americans will try it anyway. Financial literacy is a real thing as is delaying wants over needs. Getting ahead doesn’t occur by happenstance.