Our Tax System Explained: Bar Stool Economics

[Guest]

Hey Guys, just found a funny neo-con article and thought you guys might have fun ripping it to pieces.

Our Tax System Explained: Bar Stool Economics
Everyday ten men go out for beer after work and 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 first four men (the poorest) 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 tenth man (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. "Since you are all such good customers," he said, "I'm going to reduce
the cost of your daily beer by $20." Drinks for the ten 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 for free. What about
the other six men - the 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, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33%savings).
The seventh now pay $5 instead of $7 (28%savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).
Each of the six was better off than before. And the first four
continued to drink for free. But once outside the restaurant, the men
began to compare their savings.
"I only got a dollar out of the $20,"declared the sixth man. He
pointed to the tenth man," but he got $10!"
"Yeah, that's right," exclaimed the fifth man. "I only saved a dollar,
too. It's unfair that he got ten times more than I got"
"That's true!!" shouted the seventh man. "Why should he get $10 back when I got
only two? The wealthy get all the breaks!"
"Wait a minute," yelled the first four men in unison. "We didn't get
anything at all. The system exploits the poor!"
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. They didn't have enough
money between all of them for even half of the bill!
And that, ladies and gentlemen, 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. Tax them too much, attack them
for being wealthy, and they just may not show up anymore. In fact,
they might start drinking overseas where the atmosphere is somewhat
friendlier.

[Guest]

What is wrong with it? Seems accurate to me.

The rich are always screwed over by the working class. Just look at welfare, the rich pay more taxes so that the poor and homeless that don't want to work can survive.

Our tax system is socialistic, and I thank the author of this article for bringing this to light in such a simple and powerful metaphor.

[mj12]

It is a fairly accurate assessment of what income tax does to society. The big issue is the definition of "Rich". Some people think that's people earning 100K a year. Give the govt, 30-40% off the top in income tax, then pay hundreds of other daily charges and consumption taxes along the way and they end up with about half your income, at least. Paying school fees for a couple of kids, running a car and paying a mortgage, I can assure you you don't feel "rich".

The welfare state is a disaster and it is at the heart of the problem with democracy. Government has just become a means of income redistribution, much of it based on political expediency and popularism. Of course most people are going to vote to take money of greedy rich people and give it to them. That's why after 40 years of the welfare state in Western Democracies the percentage of people reliant on govt. Money has increased by a factor of ten. From about 2% to almost 30% and growing.

From an anarchist's point of view the concept of taxation should be abhorrent. It is the ultimate form of state coercion. That is why it is also morally wrong. Remember, people have NEVER in human history been more heavily taxed than they are now by liberal democracies. The worst tyrants used to take 10% of a peasant's crop as rent (a lot less than current day mortgages). Saddam Hussein did not collect income tax. Taking HALF a family's income and giving little back could be seen in historical perspective as tyranny.

It's all a scam run by modern day "socialists". True socialism where the state owns means of production is of course a proven failure in every case it has been tried. It has resulted in poverty and despair. So what "socialism" means now is stealing the output of a highly regulated and taxed economy and consuming it.

The thing is and a lot of people who pay a lot of tax say this...... you don't mind paying the tax so much... it's just how they fucking waste most of it that gives you the shits.

[vaguelyhumanoid]

The article is off because it follows the vulgar and misguided assumption that the rich are the most hurt by taxes, when in fact it's the poor. Also, state socialism/state ownership/command economy isn't true socialism. True socialism is where means of production are entirely worker-owned.

[AndyMalroes]

It didn't show the 8th, 9th and 10th men stealing the other men's money before they entered the bar.