Reply to "President Obama's tax cuts/increases"

First ...

Thank you everyone for keeping civil with one another. This really is a very mature group of guys here. You impress me with your ability to broach a subject that is so "close to home" and polarizing while remaining respectful of one another. Kudos.

I have my own thoughts on the subject of taxation. I am neither liberal or conservative, democrat or republican. These are just my observations, I am in no way trying to defend any ideology, politician or party.

I am in the highest tax bracket too, based solely upon my salary derived from my weekday job, supervising control system technicians for a large utility. Here in southern California, my income should hardly qualify for the highest tax bracket, but I am single and have no dependents, and there you have it. Almost makes me want to remarry ... well ... errrrr .... almost.

One of the unfair aspects of the US tax code, it does not recognize the regional differences in the cost of living. Somebody earning my salary in Arkansas would certainly be amongst the wealthy, but not in southern California, not in the San Francisco Bay area and not in the greater New York City area. A person in my same position in Arkansas does not make the same salary I do, because the unions and our employers recognize the regional differences in the cost of living; but the federal government does not.

Something to realize about Larry's chart, it only shows one variable, the highest tax rate. What it doesn't show is at what income the highest tax rate cuts in. I guarantee you the government does not ever lower its income. For every time they lower the tax rate, they also lower the level of income (tax brackets) at which the various tax rates apply. The government collects statistics, they know exactly how many people are in each incremental tax bracket, they know exactly how much those tax brackets must be juggled in order maintain their income when the tax rates are lowered. And they do exactly that.

Another variable are the tax deductions. When Regan lowered the tax rates, the tax code also changed and I no longer qualified for several of the deductions I had previously qualified for. The net result, I paid the same amount of income tax.

The final variable in this picture is the cost of living index. The government keeps pruning the factors that contribute to that number. For instance housing & energy are not part of the cost of living index. So the tax code (and cost of living based raises for the working man) does not keep up with the true rate of inflation. Which is why I find myself in the highest tax bracket.

I don't know one working person who opposes a flat rate tax, but it is always opposed vigorously in congress by both parties, by our elected officials who are supposed to represent the desire of their constituents. Lately I have come to believe it would be better to eliminate income tax and institute a federal sales tax to replace it. Then it would be in the governments best interest to stimulate sales within our borders. I remain fully supportive of a welfare system to help those who find themselves in temporary distress. Everybody should have a roof over their head and food in their stomachs during life's most trying moments. That's just compassion, I don't think that makes me a communist or even a socialist. My mention of socialism brings me to the last thing I want to mention ... an amusing point ... there would be no Pantera, Mustang, Hot Rod Lincolns, Sunbeam Tiger, Shelby Cobra, Noble, Saleen S7 or Ford GT40 if it weren't for a fairly well known socialist, Mr Henry Ford. His idea to produce an automobile that the average man could afford, and to pay his workers a wage that would allow them to purchase the goods they produced, were inspired by the socialist ideals he believed in.