With 4 out of 10 people in this USA country paying basically no federal taxes*** and 2 out of 10 barely paying any, leaving it up to the top 40% of earners to pay 95% of the nations taxes, it is time for me to re-post this excellent, simplistic example of how it really works.
(***a.k.a. "NTP's" = "Non-Tax-Payers")
Remember when it comes to voting for presidents and senators that 4 of 10 people are going to vote what to do with your money with the expectation that they will get more of it from a Democratic congress and president in office at the same time.
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Keep raising taxes...and this is what weâll get!
âBar Economicsâ
Suppose that every day; ten men go out for beer.
The bill for all ten comes to $100.
If they paid their bill the way we pay our taxes,
it would go something like this:
The four poorest men would pay nothing...
The fifth would pay $ 1.
The sixth would pay $ 3.
The seventh would pay $ 7.
The eighth would pay $12.
The ninth would pay $18.
The richest would pay $59.
So, that's what they decided to do. The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve. âSince you are all such good customers,â he said, âI'm going to reduce the cost of your daily beer by $20.â So the drinks for the ten men now cost just $80.
The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink free. But what about the other six men, the actual paying customers?
How could they divide the $20 windfall so that everyone would get his 'fair share?' They realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer.
So, the bar owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay.
And so:
The fifth man now paid nothing (100% savings).
The sixth paid $ 2 instead of $ 3 (33% savings).
The seventh paid $ 5 instead of $ 7 (28% savings).
The eighth paid $ 9 instead of $12 (25% savings).
The ninth paid $14 instead of $18 (22% savings).
The tenth paid $49 instead of $59 (16% savings).
Each of the six was better off than before.
And the first four continued to drink free.
Outside, the men began to compare their savings.
âI only got a dollar out of the $20â declared the sixth man. He pointed to the tenth man, âbut he got $10!â
âYeah, that's right!â exclaimed the fifth man. âI only saved a dollar, too.â It's unfair that he got ten times more than I did!'
âThat's true!!â shouted the seventh man. âWhy should he get $10 back when I got only two? The wealthy get all the breaks!'
âWait a minute,â yelled the first four men in unison. âWe didn't get anything at all. The system exploits the poor!â
So the nine men surrounded the tenth and beat him up.
The next night the tenth man didn't show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. Without the tenth man, they didn't have enough money between all of them for even half of the bill!
And that, boys and girls, journalists, and college professors, is how our tax system works.
The people who pay the highest taxes get the most benefit from a tax reduction (but the least percent tax reduction).
Tax them too much, attack them for being wealthy, and they may not show up anymore.
In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.
For those who understand, no explanation is needed.
For those who do not understand, no explanation is possible.
(also included in PDF for you to send to your whiny liberal NTP friends and liberal acquaintances)
(***a.k.a. "NTP's" = "Non-Tax-Payers")
Remember when it comes to voting for presidents and senators that 4 of 10 people are going to vote what to do with your money with the expectation that they will get more of it from a Democratic congress and president in office at the same time.
-----------------------------------------------------------------------------
Keep raising taxes...and this is what weâll get!
âBar Economicsâ
Suppose that every day; ten men go out for beer.
The bill for all ten comes to $100.
If they paid their bill the way we pay our taxes,
it would go something like this:
The four poorest men would pay nothing...
The fifth would pay $ 1.
The sixth would pay $ 3.
The seventh would pay $ 7.
The eighth would pay $12.
The ninth would pay $18.
The richest would pay $59.
So, that's what they decided to do. The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve. âSince you are all such good customers,â he said, âI'm going to reduce the cost of your daily beer by $20.â So the drinks for the ten men now cost just $80.
The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink free. But what about the other six men, the actual paying customers?
How could they divide the $20 windfall so that everyone would get his 'fair share?' They realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer.
So, the bar owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay.
And so:
The fifth man now paid nothing (100% savings).
The sixth paid $ 2 instead of $ 3 (33% savings).
The seventh paid $ 5 instead of $ 7 (28% savings).
The eighth paid $ 9 instead of $12 (25% savings).
The ninth paid $14 instead of $18 (22% savings).
The tenth paid $49 instead of $59 (16% savings).
Each of the six was better off than before.
And the first four continued to drink free.
Outside, the men began to compare their savings.
âI only got a dollar out of the $20â declared the sixth man. He pointed to the tenth man, âbut he got $10!â
âYeah, that's right!â exclaimed the fifth man. âI only saved a dollar, too.â It's unfair that he got ten times more than I did!'
âThat's true!!â shouted the seventh man. âWhy should he get $10 back when I got only two? The wealthy get all the breaks!'
âWait a minute,â yelled the first four men in unison. âWe didn't get anything at all. The system exploits the poor!â
So the nine men surrounded the tenth and beat him up.
The next night the tenth man didn't show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. Without the tenth man, they didn't have enough money between all of them for even half of the bill!
And that, boys and girls, journalists, and college professors, is how our tax system works.
The people who pay the highest taxes get the most benefit from a tax reduction (but the least percent tax reduction).
Tax them too much, attack them for being wealthy, and they may not show up anymore.
In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.
For those who understand, no explanation is needed.
For those who do not understand, no explanation is possible.
(also included in PDF for you to send to your whiny liberal NTP friends and liberal acquaintances)