This suggests that when household incomes rose, it was because more members of the household went to work, not because anybody got a bigger paycheck.

“This suggests”?? Dave Johnson of the Census Bureau said flat out that that was the case. It’s not an inference; it’s fact.

(Just in case you’re wondering, every such assertion in a Census Bureau report, paper, or presentation is checked for statistical validity by Census Bureau statisticians.)

… I never here the Goopers who oppose the “death tax” also support the passing along of DEBTS to the children of these wealthy individuals.

Yes, I know that failed businesses are divided up amongst the creditors…but this rarely fulfills the entire indebtedness. So if an individual is able to accrue PROFITS in their firm to leave behind a plump estate to their heirs…then perhaps the same should hold with DEBT ;-) …

Fascinating point. Why should the economic activity be disrupted by having the debts absolved, but not the profits? And, why should someone be allowed to accumulate great wealth AND debts and then die to pass along ONLY the wealth part when there are other people who might have neither great wealth (to pass on) nor great debts?

What human activity would YOU want to tax and how would extracting that money effect the economy?

So, accumulation of wealth is only okay if the government gets to raid it according to what they deem is appropriate and according to how they intend to spend it?

Government, to some extent, is always restrained by the people. Most people would like to believe it is entirely powerless except to the extent we hand it duties and powers, but in practice that’s an extreme. So, government taxes, with great input from the public on how and when. Whether it’s entirely fair or good for the economy is debated constantly.

Perhaps ideally we would have an economy so large and well-organized that we could have a tiny government which simply printed it’s own money to pay it’s own bills and that small amount of money would be so trivial that it wouldn’t affect the larger economy in any negative way. That way the economy could more or less stand alone and work without confusing taxes or other government interferences.

But, we aren’t quite there yet and the government we require is pretty big.

So, what part of our economic activity (the only thing in our society money relates to) should we tax, so as to not mess up the economy or to harm people and yet to raise enough for government?

We mostly say that once wealth is accumulated it’s not to be taxed. We like the stability that provides. There are a few exceptions like property taxes which go to pay for schools. But, by and large accumulated wealth isn’t taxed.

Whether an inheritance is simply accumulated wealth being passed on to the next generation or new income is only a political matter to be decided by people. There is generally no technical objective definition of what it is good to tax.

Levels of taxation might be more amenable to analysis, so we can know what levels are good or bad for the economy or for people’s comfort.

We could tax all blondes or all cigarette smokers or all who only labor with their hands or only the rich or any other category we choose. But, in the political process we simply decide how to do it. Estate taxes are seen as a good way to redistribute wealth or as a criminal double taxation, depending upon your personal view. Which is right? Who knows. But, the majority won’t be paying it, so they will probably not feel especially sensitive to those who do.

Loo Hoo. @ 101

I would agree with you if this were all earned income. If I inherit 100 million, …. No reason I shouldn’t be taxed on it. Just because my (I wish) rich uncle left me a fortune should not excuse me from paying taxes on it. …

Well, I guess “No reason I shouldn’t be taxed on it”. Why should you be taxed because you earned interest on money? Why should the government have a right to it? … If investing is legal, why should the government a right to a portion of the profit? Outlaw investing? What I am against is multiple taxation. Taxing money that has already been taxed when it was earned.

You question why ROI should be taxable. Why should a working man’s wages be taxable?

To pay it’s bills government can either print it’s own money or tax the public (somehow). There are various ways. Taxing is just a way of selecting what part of our nation’s wealth to take and how to do it in a mostly acceptable way.

Should only the super rich, who have much more money than they’ll ever need or use, be taxed, since it won’t really harm them?

Should we only tax when we consume, so as to leave people free to invest as much as they like?

Should we tax a person’s labors by taking from their pay packet?

Should we charge fees for all kinds of government services, so only those who use the government service will pay?

Pick a policy and use modeling to see if it would raise enough money to pay for the government’s purposes. It takes a lot to pay the bills and that requires taxing a lot of sources and at a fairly significant rate.

Maybe you’d want to start by asking what percent of GDP it is appropriate to tax. But, actually, as a society grows the size of government doesn’t absolutely have to grow with it. So, GDP might be a rough look at “size of government”, but it’s not as good as “does this size serve the nation’s purposes”?

We currently tax several activities: labor (through wages), consumption (sales taxes, including on gasoline), investment return, corporate profits and many fees.

Maybe all taxes are immoral in that you’re taking from someone, but if it is “we the people” who decides the rates and what to tax, then whether it’s immoral or not is only going to be as good and moral as the people.

It’s a tough subject, but if you’re interested there’s certainly plenty written about it.

Don’t tax you.
Don’t tax me.
Tax the man behind that tree.

Yes, I know that failed businesses are divided up amongst the creditors…but this rarely fulfills the entire indebtedness. So if an individual is able to accrue PROFITS in their firm to leave behind a plump estate to their heirs…then perhaps the same should hold with DEBT ;-)

Only seems fair, after all.

Well, I guess “No reason I shouldn’t be taxed on it”. Why should you be taxed because you earned interest on money? Why should the government have a right to it? If you have $100 in a savings account, why should the government have a right to it? If investing is legal, why should the government a right to a portion of the profit? Outlaw investing? What I am against is multiple taxation. Taxing money that has already been taxed when it was earned.

But everytime someone passes on taxed income to another person as salary it is taxed again. And then if that person hires someone (legally) to do some yardwork or build an extension on their garage it’s taxed again, and then if those people spend it on groceries or gasoline it’s taxed yet again.

I don’t see any reason that the wealthy are able to somehow evade a taxation on an income transfer. They’d be taxed if it was salary or an out-and-out gift.

dakine01 @ 75

and of course, it’s a member of the Walton family who has the distinction of being one of the cheapest owners in Major League Baseball

A member of the Walton family owns the Tampa Bay Devil Rays?

That’s actually Malcolm Glazer, who also owns Manchester United.

http://en.wikipedia.org/wiki/Malcolm_Glazer

Seems that when he inherited his fathers jewelry fortune he had $300 to his name. DESPITE the inheritance tax, Glazer seems to have done pretty well for himself…even putting some businesses formerly run into near-bankruptcy by our current nincompoop in chief back into solvency.

I’m of two minds about estate tax:

I tend to agree that a person who works hard all of his/her life, and makes a bunch of money, which was fairly taxed along the way, shouldn’t have to worry about that money being taxed again upon loeaving it to descendants.

But, I wonder if there would be a way to limit such an exclusion to only those who actually earned the money.

Let’s say that Paris Hilton’s parents started with nothing, then got filthy rich. I would propose that the money *they* made should pass tax-free. *However*, that money, once passed to a descendant, say Paris Hilton, who cannot prove that *her* money was ever “earned” by her – that she got it for free and accomplished nothing with it by her own toil – *that* money gets taxed.

IOW, if you earned it, you can pass it tax-free. But if the next generation just lives off that money and the interest generated – BOOM – estate tax, at a significant rate.

Do-able?

But that would effectively do away with any exclusion! Because a real employee gets a slary or other returns for their activities and…tada…THAT is taxed as INCOME! Plus one has to pay Social Security and other disbursements on it.

And it’s a little hard to say what a person contributed to the original company. Just as Bush receives advice from “God” and “dog”, Leona Helmsley’s Maltese Terrier and “Tinker” the cat certainly “earned” that money with their devoted affection and whispered advice to their owners!

http://www.courttv.com/people/…..ts_ap.html

The federal estate and gift taxes raise about 2.5% of all federal revenue.

They are not revenue raisers.

They were instituted early in the 20th century for political reasons. Allegedly to break up the fortunes of the robber barons.

But these have always been voluntary taxes.

There are 2 outs:

You can leave an an unlimited amount to your spouse free of estate tax.

You can leave an unlimited amount to charity (e.g., your own private foundation that your spouse and children control) free of federal estate tax.

Admittedly the spousal exemption is a way of “deferring” the tax…and I suppose remarriage could defer that indefinitely. But the charitable foundation exemption does not allow directors unlimited access to the funds allocated to it. In fact, Directors are often constrained to salaries (which, admittedly may amount to hundreds of thousands o dollars) and the fund must have a truly meritorious charitable purpose. The Rockefeller, Ford and MacArthur Foundations are not simply conduits for their kids to get their inheritance moneys.

The biggest way that these inheritance funds avoid the taxman is to parcel them out to units of under $1 million to a large number of recipients. The General complaint on this by those who want to eliminate the death tax is that it requires families and others to actually “work together” in the governance of a company or other assets valued over $1 million. Otherwise the asset/company will be sold off to some other entrepreneur.

But I’ve never understood why people should receive such massive windfalls simply by dint of their birthright rather than their “sweat labor” (which WOULD have been taxed as income). Why is it that if you don’t work you should avoid taxes…while if you DO WORK you get taxed on INCOME. Inheritances are GIFTS…and really get off very easy when it comes to the tax rates compared to other such “gift” forms of income. The rates are MUCH lower.

kirk murphy @ 175

Totally OT question -

Do any of you dry fruits/veggies at the end of the summer?

If so, do you use your oven or a dehydrator?

Inquiring pantries want to know…

Or can one buy big ‘ol screen “tops” to put over trays ‘o fruit/veggies while sun-drying?

Are the above questions prodromal symptoms of seasonal affective disorder?

Heh. This is my first year of actually planting the garden – normally I just do the heavy work. It was a failure. But the days of having someone else do the sissy work are gone.

I was planning on doing a solar drier for the (non-existant) tomatoes, but that’ll have to wait for next year :-).

air dry window box herbs.