Tax cuts

[Regs]

I just read this in an e-newsletter and thought a few TTPers could learn from it [not mentioning any names]...

A Parable Worth Repeating - Got a militant union member in your household or at your workplace? Have they berated Gordon Campbell's tax cuts in your presence lately? Has the rhetoric gone something along the lines of "He gave all the breaks to the rich!" Does this irk you? Here is a short story to help them understand the "fairness" of across the board tax cuts:

This article appeared in the February 23, 2002 issue of the Lakeshore News - Salmon Arm, B.C. It was written by Ron Adams, a local financial advisor who writes a regular column in the paper.

I was having lunch at PJ's with one of my favourite clients last week and the conversation turned to the Campbell government's recent round of tax cuts. "I'm opposed to those tax cuts," the retired college instructor declared, "because they benefit the rich. The rich get much more money back than ordinary taxpayers like you and I and that's not fair." "But the rich pay more in the first place," I argued, "so it stands to reason that they'd get more money back." I could tell that my friend was unimpressed by this meager argument. Even college instructors are a prisoner of the myth that the "rich" somehow get a free ride in Canada. Nothing could be further from the truth.

Let's put tax cuts in terms everyone can understand. Suppose that everyday 10 men go to PJ's for dinner, The bill for all ten comes to $100. If it was paid the way we pay our taxes, the first four men would pay nothing; the fifth would pay $1; the sixth would pay $3; the seventh $7; the eighth $12; the ninth $18. The tenth man (the richest) would pay $59. The 10 men ate dinner in the restaurant every day and seemed quite happy with the arrangement until 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 meal by $20. Now dinner for the 10 only costs $80. The first four are unaffected. They still eat for free. Can you figure out how to divvy up the $20 savings among the remaining six so that everyone gets his fair share? The men realize that $20 divided by 6 is $3.33, but if they subtract that from everybody's share, then the fifth man and the sixth man would end up being paid to eat their meal. The restaurant 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 paid nothing, the sixth pitched in $2, the seventh paid $5, the eighth paid $9, the ninth paid $12, leaving the tenth man with a bill of $52 instead of $59. Outside the restaurant, the men began to compare their savings. "I only got a dollar out the $20," declared the sixth man pointing to the tenth, "and he got $7!" "Yeah, that's right," exclaimed the fifth man. I only saved a dollar, too. It's unfair that he got seven times more than me! "That's true," shouted the seventh man. "Why should he get $7 back when I got only $2? 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 he didn't show up for dinner, so the nine sat down and ate without him. But when it came time to pay the bill, they discovered something important. They were $52 short! And that, boys and girls and college instructors, is how Canada's 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 at the table anymore. There are lots of good restaurants in Switzerland and the Caribbean.

[Dude]

But Regs, the Rich get to keep more money too. We should let them go to the beautiful tax free Bahamas, and replace them with a society of poorer people to do the same job. This way the Government collects less taxes, and the people who didn't have jobs before can now all reap the benefits of that one person leaving the country.

Your job can be replaced by, say, 10 people who would do your one job far less efficiently but divvy up your yearly take-home...can't it Regs?

Your Union Brother,

Dude- sharemycar?

[Screw You Captain]

Dude, you knew it wouldn't take long.

That dinner example was the most ridiculous tripe I've read since stumbling onto a couple of Sid's posts.

I really have no problem with people who make lots of cash. Doctors, for example, go to school forever, and do a necessary and complicated job. People who work hard and make big money, I'm all for it.

What's the shits about our tax cuts here is that it really is only the people at the extreme upper end who get a net benefit. With medical premiums, user fees, tuition increases, sales tax, and the rest of what we've been hit with, my $700 is long gone. Someone who got a $20 000 cut (most doctors from what I read this week) are still way ahead.

Happy Easter

[Fat Monkey]

Spoken like a true union sheep.

Why is it such a crime to have money in this Province? Are you so blind that you can't see the benefit of a wealthy person getting more money from this government? If I had loads of cash handed to me, my first thought would not be to leave the people who gave it to me. Moreover, it would be to spend it where I got it. In B.C.

There is no question the tax cuts benefitted the rich more than anybody. But that's the way it should be. They have the money to invest in our province and make it profitable again. I figure we should encourage that; wouldn't you?

Besides, I kinda liked my first paycheque after the cuts.

The examples you gave are true, but moot for the middle class. Medical premiums are frequently paid for by the employer. Tuition increases were ridiculously long overdue (I'm not fond of paying for someone's education, just to have them bolt to the states for work), and that half percent on the PST isn't exactly going to break me. User fees are a tough issue. I'll give you this one.

This is going to be a tough few years getting back on track. Did you think it would be easy? I can't believe the number of naive people who sit back and compain that cutbacks are taking place. Why don't we just wait for three years to go by before we pass judgement? Then we can start to sharpen the knives in preparation for the election, if that's what it takes.

Personally, I'm giving Campbell a wide berth. He deserves the opportunity to right the ship.

That is one Monkey's opinion

[Dude]

Monkey, is the sky falling? Did you just see that pig fly by? Are they playing hockey in hell today?

I'm in shock that we agree on something! The last time we agreed was when you gave me the green light to "Dish a yellow card offense" in retaliation for a teammate! Good on yah Ass Coach!

Now, about your Porn Moustache and opinions on improving officiating...

[Keeper]

This dinner example fails to note that the first four people have no choice but to go the restaurant. Moreover, they're also the ones who cook, serve the food, and wash the dishes.

Sincerely,
An unmentioned name.

[Dude]

People #1, #2, #3, & #4 are the ones collecting welfare and not working, while eating on the other people's bill. The people cooking and washing dishes fall as the 6th, 7th, and 8th people. The person serving the food is person #5, but they don't pay for their food because they do not declare 85% of their income (tips are under the table, you see), not because they don't get paid well.

I know this because person people #9 & #10 also tip well.

Eventually they all dine and dash, so it doesn't make any difference anyhow.

Yours in clarifying,

Dude-where'smywelfarecheque?

[Keeper]

There are many dishwashers that make less than the minimum tax rate. Also, there are also many people, such as yours truely, who have worked for a decent wage but end up getting they're taxes back thanks to student loan interest payments.

Not everyone who doesn't pay taxes are unemployed.

Meanwhile, on the other hand, if the richest got pissed off at people for not paying their fair share, the poor wouldn't have the choice of avoiding the next clobbering. They'd have to enjoy multiple beatings, time and time again.

[Reccos]

Of all the posts in response to the article, I think Dude has figured out the Canadian way of life quite accurately. Amazing based on most of your other posts here.

There is a valid point to the rich guy running off and not coming to dinner or paying his taxes. However, the truth be known the guy has already moved his money and investments offshore and he isn't paying taxes. The bulk of the taxes are paid by the wage earners.

[Screw You Captain]

4 out of 10 not paying taxes? Not likely. Apparently only 6% of Canadians pay no tax at all.

Fat Monkey, I do agree about the point of paying for people's education and fcuking off to the states. Barring an exit tax, though, jacking up the fees only prevents lower income folks from going to school. If you want to have doctors and such in places like Terrace, wouldn't it be nice if people from these towns could afford to go to school?

SYCisofftostimulatetheeconomyandleavesomedishwasheranicetip

[Fat Monkey]

Aaaahhhh, what a perfect world that would be.

If you think that someone would want to spend their childhood in a place like Terrace, get a terrific education for a low cost, and spend the rest of their working days in.........Terrace, then you lead a dilusional existence.

The reason people in small towns want to get an education is so they can leave that small town. You know, like in Tracy Chapman's "Fast Car?"

The only way to get doctors in small towns is to provide kickbacks and incentives. Period.

Once again, a Monkey speaks.