[Rhodes22-list] Taxes & Politics

[Rik Sandberg]

That's the exact parable that got us off on this subject to begin with.

Don't think reading it again is going to help, as far as this discussion is
concerned.

Rik

----- Original Message -----
From: "Robert Quinn" <rjquinn@bellsouth.net>
To: "The Rhodes 22 mail list" <rhodes22-list@rhodes22.org>
Sent: Saturday, January 25, 2003 10:40 AM
Subject: Re: [Rhodes22-list] Taxes & Politics


>
>
> >
> > Subject: Understanding our Tax System
> >
> > This is a VERY simple way to understand the tax laws.  Read on -- it
does
> > make you think!
> >
> > Let's put tax cuts in terms everyone can understand.  Suppose that every
> > day, ten men go out for dinner.  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 $7, the eighth $12, the ninth
$18,
> > and the tenth man -- the richest -- would pay $59.
> >
> > That's what they decided to do.  The ten men ate dinner in the
restaurant
> > every day and seemed quite happy with the arrangement -- until one day,
> the
> > owner threw them a curve (in tax language a tax cut).
> >
> > "Since you are all such good customers," he said, "I'm going to reduce
the
> > cost of your daily meal by $20."  So now dinner for the ten only cost
> > $80.00.
> >
> > The group still wanted to pay their bill the way we pay our taxes.  So
the
> > first four men were unaffected.  They would still eat for free.  But
what
> > about the other six -- the paying windfall so that everyone would get
his
> > "fair share?"
> >
> > The six men 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 end up being PAID to eat their meal.  So 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 his earlier $59.  Each of the six was better off
> than
> > before.  And the first four continued to eat 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, but he,
> pointing
> > to the tenth.  "But 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, a little late what was very
> > important.  They were FIFTH-TWO DOLLARS short of paying the bill!
> >
> > Imagine that!
> >
> > And that, boys and girls, journalists and college instructors, is how
the
> > 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.
> >
> > Where would that leave the rest?  Unfortunately, most taxing authorities
> > anywhere cannot seem to grasp this rather straightforward logic!
> >
> > T. Davies, Professor of Accounting & [Over-Stuffed]Chair,
> > Division of Accounting and Business Law
> > The university of South Dakota School of Business
>
>
>
>
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