It is truly awful. I am an old gen Xer. When I hear how casually others discuss the 'freebies' they are getting, I still flinch. I know it is unsustainable and waiting to the train to derail. Add to it the scapegoating mechanism and it is even scarier. A good friend may be at risk for getting fired. She is a serial entrepreneur in spirit and it seems that this problem occurs every few years, but she always lands on her feet one step up. This time she said how she may use the card of being a woman, older and Asian to prevent any 'firing.' It chilled me to hear my good friend repeat Cultural Marxists precepts.
I worked with a number of people who told the rest of us they were unfireable because they were minority women. And they were right.
My biggest pet peeve as a Canadian is how overpaid and underworked our bureaucrats are. At one time the unwritten agreement was if you work for the government you'll make less but you'll have job security. Now its you'll make more, have job security, and the taxpayers will fund your retirement which will be pegged to inflation.
The rest of us have to save for our own retirement by doing real work AND support all the retired bureaucrats.
Yep. I was so stunned when those words came from my friend but she works with younger people so the vibe has probably sunk in. Even FDR knew that gov't unions were a bad idea. Everyone avoids the US postal service because the buildings are disgusting and the workers are often surly.
You do realize that the U.S. military is employed by the federal government, right? Not defending the U.S. postal service, but they are not representative of the U.S. federal public service.
Remember when the cultural arbiters were amping up concern about climate change, bemoaning our collective inability to address the issue? And now that financial ruin draws closer every day, and we fund trivialities and pork barrel spending and old peoples' vacations by burdening younger generations with hundreds of thousands of dollars of debt PER CAPITA, who is sounding the alarm?
Fucking no one. Not a word or a subplot in some streaming service series. Nothing.
> Let’s get one thing out of the way: the rich already pay their “fair share.”
OK, so, I'm going to take a contrary stance for a bit, mostly because I think it's a reasonable thing to think about. Nothing in this is going to result in a policy suggestion anyway, but I'd like to game it out a bit.
I know that when we refer to "The Income Tax", the quoted line is true. In fact, the rich probably pay quite a bit *more* than their "fair share".
But it is also the case (and I am certain that *you* know this is true, as well) that the vast majority of "wealth" that the 1% (or the 0.1%, or even the 0.01%) end up with is not in the form of "income". And is therefore not taxed as income, and therefore makes that chart... not a *lie*, per se, but also not a complete picture of the reality. It's focused on only one part of the scene.
I am also certain that you know that I think taxation is theft. That everyone's "fair share" of taxes is $0. But. Leaving aside that philosophical position, and presuming that there even *can* be a "fair share" of someone else's efforts to take from them at the threat of gunpoint, *are* "the rich" truly paying their "fair share"?
They, or at least *some* of them, certainly *benefit* disproportionately from government spending. Musk, Bezos, and Gates wouldn't be nearly as rich as they are without the fat Federal contracts they have. And yes, lots of that is held in forms that I truly don't actually even comprehend, because I'm a welder-machinist-EMT-truck driver-computer jock, not a finance wizard who understands all the rampant cockgoblinry and bullshit that makes up the modern economic system and its instruments.
The real answer is "Fuck you, cut spending". I get that. I *do* wonder if we're doing our arguments a disservice by repeating claims about the "fairness" of the income tax, when even we ourselves are aware that it's not looking at anything like the whole picture. I don't want to paint a new picture that points at "tax the rich". I want to paint a new picture that helps us convince people to cut spending.
I have no idea how to do that. Yes, this entire comment is... a bit of flail-bait, in many ways.
I agree with your points. If I were to summarize it would be "the rich/powerful have advantages the rest of us don't." Correct me if I'm wrong.
We also agree that the problem is really that going after "the rich" is simply a tactic to distract from the fact that the government (all governments) are inept when if comes to spending.
My push back is largely aimed at this second point. Allowing the government to increase taxes on anyone will not fix the problem. The government will simply increase the amount it spends and then come back for more by going after everyone or redefining who "the rich" are.
I mostly agree with the broader point of the article. The one problem with the data used is that it fails to point out a major difference between U.S. government spending and that of the others in the Anglosphere, namely, that the U.S. government spending does not cover universal healthcare whereas the others do. (And yes, I know it covers the spending for some, but not for everyone as the other governments do.) I say that not to pass judgment on the healthcare systems of any of the countries cited, just that we cannot feel too contented about how much less the U.S. government spends as a percentage of GDP without considering how much less the Canadian/UK/Australian/NZ taxpayer is spending out of pocket on healthcare.
True. It is often overlooked that the U.S. government actually spends more tax dollars per capita on healthcare than almost any country with a universal system.
It's complicated, but the more we go into the weeds the more we risk not seeing the forest for the trees (how's that for mixing my metaphors?). The main point is that governments are spending more than we can afford in the long (possibly short to medium) term.
Sure, but all of those countries get to do that (along with the EU) because they *don't* have to pay for national defense, and haven't had to, for decades. Not *seriously*, anyway. Canada's position as America's Hat means that there is a zero percent chance that America would not respond to an invasion of Canada with thunder and fury. Trump is justified in feeling some ire at the other members of NATO for not shouldering their chunk of the burden, not that I think NATO should have continued (or at least America's participation in it) past the fall of the Soviet Union. I think it was about 1995 I came to that realization. I remember having at least *one* conversation about it while I was still in high school, anyway.
Of course, we're thirty years past *that* point now too, and reaping that which we've sown in the form of the Ukraine invasion, already.
*sigh*
Nobody ever listens to me. Maybe I should change my name again. I wonder what the masculine form of "Cassandra" is...
---
Edit: Oh, apparently all I needed to do was consult the Oracle at Google: "The primary masculine form of Cassandra is Cassander (or Kassandros in its original Greek). Spanish and Galician forms also offer Casandro. "
We've created a system that will see the prudent amongst us go broke paying for those who believe they deserve that $28 lunch no matter how little they work.
Maybe we should tax the system instead of the people. What if we think outside the box. The tax base as it exists today primarily taxes wages and earnings generated in the Real Economy (roughly represented by GPP which is about $30 Trillion) So we extract about $5 Trillion annually from the Real Economy - about one sixth. But there is another Economy most people do not pay much attention to - the Monetary Economy, which is the financial layer. The massive monetary flows settled at, for example DTCC and CLS, total in the neighborhood of $5 Quadrillion in flows per year. A .1% (10 basis point) levy on those flows would net $5 Trillion - almost exactly the tax revenue that is collected currently. Maybe there are fundamental systems changes like this that would allow us to pay down debt, shift some of the tax burden off workers and provide new fiscal capacity to invest in American renewal
That is largely beyond me, but I will say when you tax something you discourage it to some extent.
A brief exchange with AI resulted in this comment:
"a large percentage of these flows consists of low-margin, high-frequency transactions (such as market-making and high-frequency trading) that operate on razor-thin spreads of less than 0.01%. Imposing a 0.1% levy would immediately eliminate the profitability of these trades, causing the $5 quadrillion volume base to shrink by an estimated 80% to 95%."
Seems to make sense, but again, I'm not an expert by any stretch of the imagination.
I think this is a very fair concern — and one of the most important questions the proposal has to answer.
Yes, when you tax a flow, behavior will change. Some transactions would become less profitable. Some volume would shrink. Some activity might be netted differently, routed differently, or disappear altogether. So I would not argue that we can simply apply a rate to the full existing settlement base and assume nothing changes.
The key question is how much of the base is fragile and how much is tied to necessary settlement activity that is less elastic. Some high-frequency, low-margin trading may be very sensitive to even a tiny toll. But not all settlement flows are the same. Treasury settlement, repo financing, securities clearing, foreign exchange settlement, derivatives margin flows, and other institutional flows do not all respond the same way.
One important clarification: the proposal is not to tax notional values or every trade as reported. It is aimed at cash settlement flows — where money actually moves through core settlement infrastructure.
Your comment also reinforces something I have been weighing: a 0.1% levy may be too high as an initial assumption. A more careful version might start much lower, phase in gradually, and measure the effects on volume, liquidity, spreads, and revenue before scaling.
So I take the objection seriously and appreciate your response. I don’t think it defeats the idea, but it does mean the proposal has to be stress-tested and designed with safeguards and possible exceptions for key liquidity activity. The point is to ask whether a very small settlement toll could shift some tax burden away from workers and the real economy without damaging the useful financial plumbing we actually need.
What's the national equivalent of a $28 dollar lunch? Financing Israel's every whim. Why are we giving money to a country that gives its citizens free healthcare when we don't even do that for Americans?
U.S. aid to Israel accounts for less than 0.1% of the total U.S. federal budget.
$28 once per week when you make $70k is 2.08%.
However, the question should be "what does the US get from aid to Israel?" It's only a waste of money if provides no return.
I get your point though. However, aid to Israel is small potatoes when you look at some of the big ticket issues. The problem is that there's never a call to weigh priorities, it's just give us more, more more!
There's some precedence for the Golden Share with the Committee on Foreign Investment in the United States. I expect POTUS made the merger deal with Nippon Steel and US Steel due to national security concerns much as the US government during WWII seized control over some industries for war production. Human behavior does not bode well for reducing taxes. Our connectedness leads to expectations that are unrealistic. People at all income levels look at how the next rung up is living and that becomes an entitlement, and taxes are raised. The only way I can see to counteract that is with a spiritual revival. https://www.spglobal.com/energy/en/news-research/latest-news/metals/062625-in-rare-deal-for-us-government-owns-a-piece-of-us-steel
> Government ownership in private industry outside of times of national emergency is counter to free market principals.
It is, it's true. I realize it's going to be kind of shocking to hear *me*, of all people say this, but selling off all of our industrial capacity to foreign nations is *also* kind of a national emergency.
On the flip side, the time to take that stand was 50 years ago. At this point we're sifting the ashes of the barn to look for the hasp so we can close the door while the horse is already a thousand miles away. :-/
I agree with your second paragraph. However the role of the government in that case should be to restrict who can own a majority share in a firm, not to take a share in it itself.
Agreed. It's not the way I'd have done it. Honestly, as long as they don't try to ship the plant equipment overseas, it doesn't really matter who *owns* it, so long as we retained the authority to say that they couldn't just shut it down.
It is truly awful. I am an old gen Xer. When I hear how casually others discuss the 'freebies' they are getting, I still flinch. I know it is unsustainable and waiting to the train to derail. Add to it the scapegoating mechanism and it is even scarier. A good friend may be at risk for getting fired. She is a serial entrepreneur in spirit and it seems that this problem occurs every few years, but she always lands on her feet one step up. This time she said how she may use the card of being a woman, older and Asian to prevent any 'firing.' It chilled me to hear my good friend repeat Cultural Marxists precepts.
I worked with a number of people who told the rest of us they were unfireable because they were minority women. And they were right.
My biggest pet peeve as a Canadian is how overpaid and underworked our bureaucrats are. At one time the unwritten agreement was if you work for the government you'll make less but you'll have job security. Now its you'll make more, have job security, and the taxpayers will fund your retirement which will be pegged to inflation.
The rest of us have to save for our own retirement by doing real work AND support all the retired bureaucrats.
I'll get off my soapbox now.
Yep. I was so stunned when those words came from my friend but she works with younger people so the vibe has probably sunk in. Even FDR knew that gov't unions were a bad idea. Everyone avoids the US postal service because the buildings are disgusting and the workers are often surly.
The government should protect the borders and staff the military and diplomatic corps.
There might be something else but if there is it escapes me at the moment.
😹
You do realize that the U.S. military is employed by the federal government, right? Not defending the U.S. postal service, but they are not representative of the U.S. federal public service.
I always considered the military to be the least representative of the government and the post office closer to the norm.
At least the military is performing a role we would not want the private sector to do.
You could outsource the post office to private industry and it would become less expensive and more efficient.
Remember when the cultural arbiters were amping up concern about climate change, bemoaning our collective inability to address the issue? And now that financial ruin draws closer every day, and we fund trivialities and pork barrel spending and old peoples' vacations by burdening younger generations with hundreds of thousands of dollars of debt PER CAPITA, who is sounding the alarm?
Fucking no one. Not a word or a subplot in some streaming service series. Nothing.
https://jmpolemic.substack.com/p/silence-as-a-political-strategy
It up to us. Not just you an I obviously, but the thousands of us on Substack who see the problem.
Thanks for the comment James!
> Let’s get one thing out of the way: the rich already pay their “fair share.”
OK, so, I'm going to take a contrary stance for a bit, mostly because I think it's a reasonable thing to think about. Nothing in this is going to result in a policy suggestion anyway, but I'd like to game it out a bit.
I know that when we refer to "The Income Tax", the quoted line is true. In fact, the rich probably pay quite a bit *more* than their "fair share".
But it is also the case (and I am certain that *you* know this is true, as well) that the vast majority of "wealth" that the 1% (or the 0.1%, or even the 0.01%) end up with is not in the form of "income". And is therefore not taxed as income, and therefore makes that chart... not a *lie*, per se, but also not a complete picture of the reality. It's focused on only one part of the scene.
I am also certain that you know that I think taxation is theft. That everyone's "fair share" of taxes is $0. But. Leaving aside that philosophical position, and presuming that there even *can* be a "fair share" of someone else's efforts to take from them at the threat of gunpoint, *are* "the rich" truly paying their "fair share"?
They, or at least *some* of them, certainly *benefit* disproportionately from government spending. Musk, Bezos, and Gates wouldn't be nearly as rich as they are without the fat Federal contracts they have. And yes, lots of that is held in forms that I truly don't actually even comprehend, because I'm a welder-machinist-EMT-truck driver-computer jock, not a finance wizard who understands all the rampant cockgoblinry and bullshit that makes up the modern economic system and its instruments.
The real answer is "Fuck you, cut spending". I get that. I *do* wonder if we're doing our arguments a disservice by repeating claims about the "fairness" of the income tax, when even we ourselves are aware that it's not looking at anything like the whole picture. I don't want to paint a new picture that points at "tax the rich". I want to paint a new picture that helps us convince people to cut spending.
I have no idea how to do that. Yes, this entire comment is... a bit of flail-bait, in many ways.
Your thoughts?
I agree with your points. If I were to summarize it would be "the rich/powerful have advantages the rest of us don't." Correct me if I'm wrong.
We also agree that the problem is really that going after "the rich" is simply a tactic to distract from the fact that the government (all governments) are inept when if comes to spending.
My push back is largely aimed at this second point. Allowing the government to increase taxes on anyone will not fix the problem. The government will simply increase the amount it spends and then come back for more by going after everyone or redefining who "the rich" are.
I mostly agree with the broader point of the article. The one problem with the data used is that it fails to point out a major difference between U.S. government spending and that of the others in the Anglosphere, namely, that the U.S. government spending does not cover universal healthcare whereas the others do. (And yes, I know it covers the spending for some, but not for everyone as the other governments do.) I say that not to pass judgment on the healthcare systems of any of the countries cited, just that we cannot feel too contented about how much less the U.S. government spends as a percentage of GDP without considering how much less the Canadian/UK/Australian/NZ taxpayer is spending out of pocket on healthcare.
True. It is often overlooked that the U.S. government actually spends more tax dollars per capita on healthcare than almost any country with a universal system.
It's complicated, but the more we go into the weeds the more we risk not seeing the forest for the trees (how's that for mixing my metaphors?). The main point is that governments are spending more than we can afford in the long (possibly short to medium) term.
Sure, but all of those countries get to do that (along with the EU) because they *don't* have to pay for national defense, and haven't had to, for decades. Not *seriously*, anyway. Canada's position as America's Hat means that there is a zero percent chance that America would not respond to an invasion of Canada with thunder and fury. Trump is justified in feeling some ire at the other members of NATO for not shouldering their chunk of the burden, not that I think NATO should have continued (or at least America's participation in it) past the fall of the Soviet Union. I think it was about 1995 I came to that realization. I remember having at least *one* conversation about it while I was still in high school, anyway.
Of course, we're thirty years past *that* point now too, and reaping that which we've sown in the form of the Ukraine invasion, already.
*sigh*
Nobody ever listens to me. Maybe I should change my name again. I wonder what the masculine form of "Cassandra" is...
---
Edit: Oh, apparently all I needed to do was consult the Oracle at Google: "The primary masculine form of Cassandra is Cassander (or Kassandros in its original Greek). Spanish and Galician forms also offer Casandro. "
"Trump is justified in feeling some ire at the other members of NATO for not shouldering their chunk of the burden"
I agree. I was in the Canadian Navy and have been bitching about our spending for decades.
I don't disagree with everything Trump does.
We are riding a runaway train.
The brake handle is gone.
The engineers keep changing, but without a brake handle they only announce that we are fine, even though no one believes them.
The passengers are nervous, but all they can think of is to crowd into the dining car and order $28 lunches.
We've created a system that will see the prudent amongst us go broke paying for those who believe they deserve that $28 lunch no matter how little they work.
And who believe that's all they'll get, no matter how hard they work.
Yes. Thank you social media.
Like the Jethro Tull song.
Locomotive Breath, Exactly what was in my head.
In the shuffling madness . . .
Maybe we should tax the system instead of the people. What if we think outside the box. The tax base as it exists today primarily taxes wages and earnings generated in the Real Economy (roughly represented by GPP which is about $30 Trillion) So we extract about $5 Trillion annually from the Real Economy - about one sixth. But there is another Economy most people do not pay much attention to - the Monetary Economy, which is the financial layer. The massive monetary flows settled at, for example DTCC and CLS, total in the neighborhood of $5 Quadrillion in flows per year. A .1% (10 basis point) levy on those flows would net $5 Trillion - almost exactly the tax revenue that is collected currently. Maybe there are fundamental systems changes like this that would allow us to pay down debt, shift some of the tax burden off workers and provide new fiscal capacity to invest in American renewal
That is largely beyond me, but I will say when you tax something you discourage it to some extent.
A brief exchange with AI resulted in this comment:
"a large percentage of these flows consists of low-margin, high-frequency transactions (such as market-making and high-frequency trading) that operate on razor-thin spreads of less than 0.01%. Imposing a 0.1% levy would immediately eliminate the profitability of these trades, causing the $5 quadrillion volume base to shrink by an estimated 80% to 95%."
Seems to make sense, but again, I'm not an expert by any stretch of the imagination.
I think this is a very fair concern — and one of the most important questions the proposal has to answer.
Yes, when you tax a flow, behavior will change. Some transactions would become less profitable. Some volume would shrink. Some activity might be netted differently, routed differently, or disappear altogether. So I would not argue that we can simply apply a rate to the full existing settlement base and assume nothing changes.
The key question is how much of the base is fragile and how much is tied to necessary settlement activity that is less elastic. Some high-frequency, low-margin trading may be very sensitive to even a tiny toll. But not all settlement flows are the same. Treasury settlement, repo financing, securities clearing, foreign exchange settlement, derivatives margin flows, and other institutional flows do not all respond the same way.
One important clarification: the proposal is not to tax notional values or every trade as reported. It is aimed at cash settlement flows — where money actually moves through core settlement infrastructure.
Your comment also reinforces something I have been weighing: a 0.1% levy may be too high as an initial assumption. A more careful version might start much lower, phase in gradually, and measure the effects on volume, liquidity, spreads, and revenue before scaling.
So I take the objection seriously and appreciate your response. I don’t think it defeats the idea, but it does mean the proposal has to be stress-tested and designed with safeguards and possible exceptions for key liquidity activity. The point is to ask whether a very small settlement toll could shift some tax burden away from workers and the real economy without damaging the useful financial plumbing we actually need.
Obviously I am speaking about the US...
What's the national equivalent of a $28 dollar lunch? Financing Israel's every whim. Why are we giving money to a country that gives its citizens free healthcare when we don't even do that for Americans?
U.S. aid to Israel accounts for less than 0.1% of the total U.S. federal budget.
$28 once per week when you make $70k is 2.08%.
However, the question should be "what does the US get from aid to Israel?" It's only a waste of money if provides no return.
I get your point though. However, aid to Israel is small potatoes when you look at some of the big ticket issues. The problem is that there's never a call to weigh priorities, it's just give us more, more more!
There's some precedence for the Golden Share with the Committee on Foreign Investment in the United States. I expect POTUS made the merger deal with Nippon Steel and US Steel due to national security concerns much as the US government during WWII seized control over some industries for war production. Human behavior does not bode well for reducing taxes. Our connectedness leads to expectations that are unrealistic. People at all income levels look at how the next rung up is living and that becomes an entitlement, and taxes are raised. The only way I can see to counteract that is with a spiritual revival. https://www.spglobal.com/energy/en/news-research/latest-news/metals/062625-in-rare-deal-for-us-government-owns-a-piece-of-us-steel
Government ownership in private industry outside of times of national emergency is counter to free market principals.
The reason so many are opposed to capitalism is because they see this type of thing and think it's capitalism when it's not.
A spiritual revival is only slightly more likely than a constitutional amendment that restricts voting to those who pay net taxes.
> Government ownership in private industry outside of times of national emergency is counter to free market principals.
It is, it's true. I realize it's going to be kind of shocking to hear *me*, of all people say this, but selling off all of our industrial capacity to foreign nations is *also* kind of a national emergency.
On the flip side, the time to take that stand was 50 years ago. At this point we're sifting the ashes of the barn to look for the hasp so we can close the door while the horse is already a thousand miles away. :-/
I agree with your second paragraph. However the role of the government in that case should be to restrict who can own a majority share in a firm, not to take a share in it itself.
Agreed. It's not the way I'd have done it. Honestly, as long as they don't try to ship the plant equipment overseas, it doesn't really matter who *owns* it, so long as we retained the authority to say that they couldn't just shut it down.
They used to have laws that only allowed contributing members of society to vote. The courts ruled it unconstitutional. Is anyone surprised?
The intention were good. They didn't anticipate the mommy state.