Toad
02-17-2004, 06:25 AM
It's tax time again.
"Understanding tax cuts"
Let's put tax cuts in the terms everyone can
understand. Suppose that once a mo. 10 men meet for
dinner and the bill is $100. They agree to pay for it
the way we pay taxes. Each month the 1st four----the
poorest--- would pay nothing, the 5th would pay $1,
the 6th would pay $3, the 7th would pay $7, the 8th
$12, the 9th $18 and the tenth ---the richest----would
pay $59. That's what they agreed to do and all were
happy with the arrangement for many months.
One day the restaurant owner decided, because they
were such good customers, to cut the price of their
meal by $20 so now it cost only $80. The group still
wanted to pay the way we pay taxes. So the 1st 4 were
unaffected, they still ate for free, but the $20
needed to be divvied up among the other six.
If they just divided the $20 by 6, each of the 6 would
receive $3.33, meaning #5 and #6 would actually get
paid to eat. So the restaurant owner suggested they
divvy up the $20 the same way they paid.
The 5th now paid nothing, #6 paid $2, #7 paid $5, #8
paid $9 and the ninth paid $12, leaving #10 to pay $52
instead of $59. Each of the 6 were better off than
before and the first 4 still ate free.
BUT #6 declared "I only got $1 out of the $20 when #10
got $7". Number 5 also declared "I only got $1 why
should #10 get 7 times more then me? The wealthy get
all the breaks!".
The first four said "wait a minute we didn't get
anything -- the system exploits the poor".
The first nine beat up the tenth guy and he didn't
show up for dinner the next month---he had moved his
business to a different country.
The nine still had dinner and guess what? When it came
time to pay the bill----- they were $52 short.
"Understanding tax cuts"
Let's put tax cuts in the terms everyone can
understand. Suppose that once a mo. 10 men meet for
dinner and the bill is $100. They agree to pay for it
the way we pay taxes. Each month the 1st four----the
poorest--- would pay nothing, the 5th would pay $1,
the 6th would pay $3, the 7th would pay $7, the 8th
$12, the 9th $18 and the tenth ---the richest----would
pay $59. That's what they agreed to do and all were
happy with the arrangement for many months.
One day the restaurant owner decided, because they
were such good customers, to cut the price of their
meal by $20 so now it cost only $80. The group still
wanted to pay the way we pay taxes. So the 1st 4 were
unaffected, they still ate for free, but the $20
needed to be divvied up among the other six.
If they just divided the $20 by 6, each of the 6 would
receive $3.33, meaning #5 and #6 would actually get
paid to eat. So the restaurant owner suggested they
divvy up the $20 the same way they paid.
The 5th now paid nothing, #6 paid $2, #7 paid $5, #8
paid $9 and the ninth paid $12, leaving #10 to pay $52
instead of $59. Each of the 6 were better off than
before and the first 4 still ate free.
BUT #6 declared "I only got $1 out of the $20 when #10
got $7". Number 5 also declared "I only got $1 why
should #10 get 7 times more then me? The wealthy get
all the breaks!".
The first four said "wait a minute we didn't get
anything -- the system exploits the poor".
The first nine beat up the tenth guy and he didn't
show up for dinner the next month---he had moved his
business to a different country.
The nine still had dinner and guess what? When it came
time to pay the bill----- they were $52 short.