139 Responses

  1. Walt Greenway says:

    Doesn’t bowling use a handicap scoring system in league play to make the competition more equal?

    • Methinks says:

      Look in the distance, Walt. That dot you see on the horizon is the point of Mark Perry’s post. You might want to go have a look at it.

      • Walt Greenway says:

        Methinks, it doesn’t matter how far back I look or how far ahead I look, I see a progressive federal income tax. Call me when it changes.

        You are correct, though, taxes are considered at any and all levels and drive many decisions. I spent this month moving income from this year to next year.

        • Methinks says:

          Well, my point was that bowling handicaps don’t have anything to do with the point MP was trying to make.

          i won’t need to call you when it changes as we’ll be in the midst of the shitfest that accompanies all currency collapses and it won’t be obvious to you only if you’re dead. And – NO, currency collapses are not uncommon events. They’re all too common.

          With the exception of a large gaping hole in logic surrounding unions, I get that you understand incentives. It takes a special moron to insist that people don’t respond to incentives.

          • Walt Greenway says:

            “Well, my point was that bowling handicaps don’t have anything to do with the point MP was trying to make.”

            There’s always someone trying to level the playing field and there’s always someone trying to find an advantage to get around that leveling. I think the bowling handicap scoring system is very relevant to our progressive federal tax system from both sides.

          • Methinks says:

            Sure. As a non sequitur uttered by a drunk guy, that would totally make sense.

  2. Methinks says:

    We might also want to check our fantasy of a life of leisure provided for us by a tax slave against reality.

    I posted a few links, but the comment didn’t come through. Regardless of where the top marginal income tax rate investment tax rate, etc. has been (and they have been all over the map), the government collected an average of 18% of GDP. A quick peak at historical effective tax rates informs us that the top quintile paid nowhere near the posted tax rate.

  3. Luther says:

    I just got promoted and, with it, entered a higher tax bracket. While it certainly makes me hate taxes even more, I don’t think it prevent(ed,s) me from striving to be more productive. I DO however, believe the better argument is that those earnings are now more greatly wasted by government as opposed to being invested by me in things that are likely to bring us more efficient value. Most high earners are small business owners and society would more greatly benefit from them expanding their business (or influence) and investments than by dumping it into the DC swamp to be gobbled up by cronies and other less productive individuals and activities.

    • Max Planck says:

      “I just got promoted and, with it, entered a higher tax bracket. While it certainly makes me hate taxes even more, I don’t think it prevent(ed,s) me from striving to be more productive”

      And it never stopped anyone else either. You just keep advancing and improving yourself. The small pinch of the higher bracket means nothing in the end. And I’m someone who maxed out his Social Security contribution for most of his life.

      Which I doubt few of the posters here ever have accomplished.

      • SeattleSam says:

        You maintain that making work yield less disposable income to the worker has absolutely no effect on the amount of work people want to do? Are there any other exceptions to the economic rule that taxing something diminishes demand? Or just this one?

        • Max Planck says:

          Sir, we have a MARGINAL tax system. I personally doubt if the increase in tax this man is paying will amount to more than one cheeseburger a week.

          You people are idiots. again: for someone earning $340,000 a year, the tax increase comes to $38 per week.

          Who the hell is getting disincentivized by that? You’re kidding yourselves.

          • Methinks says:

            The people at the margin, moron.

          • Max Planck says:

            “The people at the margin, moron.”

            Uh, needledick: NO ONE CARES. When someone gets a promotion, or advances themselves, or realizes the fruits of their labor and actualizes their potential, I never saw anyone kick themselves and say “Oh, shit, pity me, I’m in a higher tax bracket”

            ESPECIALLY NOW.

          • Methinks says:

            LOL! No, I mean it. I laughed out loud. I realize that every one of your posts are a fantastic display of your criminal stupidity. However, I would have thought that even an imbecile with a single-digit IQ could understand that “needledick” is not a particularly effective insult when directed at a woman.

          • Max Planck says:

            Well, madam, given that your on line “voice” has all the feminine qualities of say, a tractor pull, it was hard to make the determination.

            As far as judging anyone else’s intelligence, just scrolling through each reply of yours reveals a person of little intellectual substance with the maturity of a 6 year old. Your posts are nothing more than gratuitous insults.

            Help yourself.

          • LarryG says:

            re: ” the maturity of a 6 year old. Your posts are nothing more than gratuitous insults.”

            Max – you can’t insult Methinks that way! She’s a hero here and has special privileges to speak like a 6 year old!

            :-)

          • Ken says:

            Max,

            First, you should know that methinks is an old Russian woman. Calling her “needledick” isn’t much of an insult.

            Secondly, when your take home pay is actually less after your salary gets bumped up, due to the ridiculous tax code the US has, then yes, people actually care. Why do you think welfare is the trap that it is? It is designed to keep people on welfare, dependent on the state, bringing in reliable votes to the politicians who dole out the cash.

            A single mother with two kids takes home more money earning only $29,000/year (gross) than she would if she earned $29,001-$69,000 (gross). Please explain to me why any single mother of two would gross a dime over $29,000/year, when her net pay is guaranteed to be less unless she can earn more the twice the current $29,000/year she’s currently grossing? Do you know anyone who grossed $29,000 in one year, then all the sudden grossed at least $69,000 the next, besides college students?

          • Max Planck says:

            “First, you should know that methinks is an old Russian woman. Calling her “needledick” isn’t much of an insult.”

            That explains it.

          • SeattleSam says:

            I’m not kidding myself. Years ago when I was in the supermarket business, I heard the same argument: If we raise the price of canned peas from 38 cents to 39 cents (that shows you how long ago this was), who the hell would be “disincentivized” to buy peas? My God, it’s only a penny! Yet, when we did, somehow we really sold fewer cans of peas. And in the aggregate, people also respond to changes in the incremental return from working — notwithstanding that you “personally doubt” that they do.

          • Max Planck says:

            I’m sorry, but we’ve had rates jump up and down throughout my working lifetime, and again, it never stopped anyone from focusing on the task they had at hand.

            Ask any entrpreneur or innovator if they ever gave a thought to tax policy when they started their careers.

            If your position were to be true, you would see a massive behavioural shift in attitudes towards labor with every change in the tax code.

            I have never seen that, and I would like someone to prove it. Ask yourself: do you think people are REALLY incentivized to work harder if their taxes are cut?

            In the meantime, you keep avoiding the fact that these increases the President is demanding amount to nothing in real dollars. The cost of a nice dinner out for two people, with drinks, each month, for someone earning north of $300K a year.

            PLEASE don’t delude yourself that this is a deal killer for anyone in that position.

          • Methinks says:

            What’s the matter Maxie? You can’t handle a woman who can see you for the limpdick imbecile that you are? I know it hurts, baby, but trotting out video of Russian peasants, impoverished by the very system an idiot like you seeks to impose here doesn’t really help you. Unlike you, each one of those peasants understands the banal concept of incentives.

          • Max Planck says:

            “What’s the matter Maxie? You can’t handle a woman who can see you for the limpdick imbecile that you are?”

            Madam, your gossamer light femininity is simply overwhelming. How could anyone ever mistake you for a man? Or a steel mill worker, or a welder?

          • Methinks says:

            mmmmm…..still not feeling insulted. Nice try, though! you have managed to insult every woman who kept the steel mills running while the men were off fighting in WWII. I’m sure they appreciate it. Ken still wins. If I remember correctly, he went for “old Russian hag” when he discovered I wasn’t in favour of men using women as their personal incubators. But, then, Ken is much more intelligent than you. I have a unique ability to piss off the right-wingers and the left-wingers – especially if they happen to be blithering idiots or exceptionally emotionally insecure and blustering about the “accomplishment” of maxing out their SS payments. They max out at what….$110K? LOL! That’s nothing in the NYC area! Dumbass NEA teachers who only work 9 months per year make more than that in NYC. That you you think this is an accomplishment is hilarious. Congrats! You can finally afford a 500 square foot apartment in an elevator building right next to Spanish Harlem.

            I do get a kick out of watching you idiots go crazy.

          • Max Planck says:

            “– especially if they happen to be blithering idiots or exceptionally emotionally insecure and blustering about the “accomplishment” of maxing out their SS payments. They max out at what….$110K? ”

            It has a different meaning when you accompish this by July.

            What charm school did your parents send you to?

          • Methinks says:

            Oh, okay. You can swing a 700 square foot apartment in that building. Golf clap. I lived in NYC for a long time. That kind of income is only impressive to people living in Southern trailer parks. Anyone in the NYC area knows you’re just getting by – particularly if that’s all you’ve managed to accomplish by middle age. If you’re going to try to use your income to brag, you need much stronger ammo. Even dimwits on Wall Street manage mid-six figures and most can claw their way close to seven. At least by your age.

            The charm school I went to didn’t require me to have a single gram of respect for aggressive imbecilic thieves. I’m just impolite enough to identify you for what you are and you’re just hypocrite enough to abandon your supposed leftard ideals of equality and identity politics to attack my femininity because I don’t conform to your hated right-wingers’ definition of “woman”. This surprises me not at all. At least the right is honest in its desire to subjugate. Mostly honest.

          • Max Planck says:

            I live in a home in one of the wealthiest zip codes in the nation, whose public schools are routinely ranked in the top ten in the nation. My home would sell for approximately $800,000. Property taxes come to $15,762.

          • Methinks says:

            Dude, I don’t know where you live, but in Greenwich you can’t buy a house for under $2.5 Million that isn’t a tear-down. It’s only slightly better if you go out way East to Westport. Maybe you live in Patterson and in that ghetto you have the nicest house on the block. I don’t know. All I know is that if I were you, I’d find something else to brag about because this is kind of pathetic.

          • Max Planck says:

            “Dude, I don’t know where you live, but in Greenwich you can’t buy a house for under $2.5 Million that isn’t a tear-down. It’s only slightly better if you go out way East to Westport. Maybe you live in Patterson and in that ghetto you have the nicest house on the block. I don’t know. All I know is that if I were you, I’d find something else to brag about because this is kind of pathetic.”

            I doubt you live as well as I do, but prattle on anyway.

          • Methinks says:

            Your doubts don’t change how I or anyone else lives and I have no need to compensate for my deficits by trotting out such a pathetic symbol of self-worth. It’s quite sad that you’re 60, so under-accomplished (particularly since you claim to work as a “financial professional”. Although, you don’t know econ or finance, so that might explain the relatively low income) and still trying to swing his paltry paycheck around like you’re a geeky 20-something in a bar trying to pick up the bridge and tunnel chicks. You probably tell them proudly that you’re a stock broker. They think that’s really something.

            I’m so sad for you.

          • Max Planck says:

            The only person you’re insulting is yourself.

            Go for it, toots.

          • Methinks says:

            That’s right, Maxie. Your lack of accomplishments is an insult to me. Good thinking! I guess that’s why the pay you the little bucks, huh?

            Love,
            Toots

          • morganovich says:

            as ever, max is just making up numbers.

            $38 a week?

            it’s closer to $300.

            the average increase in annual tax for the $200-500k income bracket would be a bit over $14,600 a year.

            http://www.cbsnews.com/8301-505123_162-57561036/what-falling-off-the-fiscal-cliff-means-for-you/

            all the brackets are going up at the moment.

            i realize there is no point in showing you actual numbers as you are as innumerate as you are deluded, but $38 a week is about $2000 a year.

            even if just the top rate rose on income over $250k that 3.6% hike would be more than that on $340k.

            0.36 X 90k = $3240, not the $1976 you claim.

            of course, if some of that income was cap gains, then taxes are REALLY going up.

            if that 90k was a cap gain, the tax would increase by 0.86 x 90 = $7740.

            for someone who claims to be a financial planner, you sure do not seem to be able to do basic math or grasp really simple concepts.

            that sort of increased tax will prevent investment at the margin. if you have some rate of return you seek, it will push some investments outside you range and drop overall investment, growth, etc.

            these are concepts so basic that if you do not grasp them there is really just no talking to you.

            “Ask any entrpreneur or innovator if they ever gave a thought to tax policy when they started their careers. ”

            i have started 6 companies. we absolutely thought about taxes in every case.

            i also make investments for a living. we sure look at taxes when deciding where to put money. so does everyone else from banks to VC’s. i just passed on an angel deal because it was going to have a tax structure that made it unattractive as the taxes on dividends it proposed to pay would be too high to make it work.

            only a complete fool invests without considering the tax implications and only someone who has absolutely no idea how investment works could claim that tax changes do not affect investment decisions.

          • Max Planck says:

            I’m not making up numbers, and if you want to hurl insults, you display a shocking ignorance of the tax laws.

            The 39.6% rate DOES kick in at an income level over 250k for a married couple. However, we don’t tax on what we put down on Line 1 of a 1040 form. In fact, I was being TOO alarmist with my $38 a week estimate.

            The 340k threshold comes from an estimate of the income that would be needed just to show the first dollar of a tax increase under the new bracket. Why?

            Let us first presume that this couple earning $340k pays some state taxes. That comes off Line 1. Let us presume they own a home, as most people in this earnings class do, although indeed, a handful of them might rent. However, they could write off their mortgage interest, and property taxes, and subtract that from Line 1 as well. They could also deduct contributions to qualified plans. For 2013, an employee could contribute up to $17,500. Since this couple is filing jointly, that figure might increase.

            Score another deduction off Line 1.

            The fact is this “tax increase” amounts to nothing. But everyone is making this a scrimmage line for the direction of the country. As you can see, this is more symbol than substance.

            The other key revenue raisers are the taxes on dividends and capital gains, and for this, the administration has suggested raising both to max out at 20%. This is a conservative increase, and a prudent one, given where interest rates sit now.

            In other words, these increases could not be considered oppressive by anyone, just as they weren’t considered oppressive when they were in force before Bush was elected. They will present no headwind to consumption or the economy.

          • Max Planck says:

            “only a complete fool invests without considering the tax implications and only someone who has absolutely no idea how investment works could claim that tax changes do not affect investment decisions”

            I never said that. Ever. But you’re presuming we’re going over the cliff and the entire Clinton era tax set will be put in place. That would mean dividends taxes at ordinary income levels.

            “i just passed on an angel deal because it was going to have a tax structure that made it unattractive as the taxes on dividends it proposed to pay would be too high to make it work.”

            I’ve gotten involved in some seed capital and PE deals myself. Please explain how the dividends would be taxed “too high” on this particular investment.

          • Methinks says:

            Maxie: “The fact is this “tax increase” amounts to nothing.”

            Which then begs the obvious question: If the increase amounts to nothing, then it won’t raise any revenue and why bother increasing the tax rate?

            I await your all-caps response with bated breath, Maxie Blank.

          • Max Planck says:

            “Which then begs the obvious question: If the increase amounts to nothing, then it won’t raise any revenue and why bother increasing the tax rate?”

            I didn’t say it “amounted to nothing.” It is estimate these increases will raise $900 billion over the next 10 years. I have no data on how much the cap gains and dividend increases (which the NYTimes said was a “give-way” in today’s Editorial) will raise.

            Me, I would advocate a “Tobin Tax” and a tiny tax on stock transactions- that would raise billions and help to curb High Frequency Trading, which is killing our equity markets.

          • Ron H. says:

            Methinks: “Which then begs the obvious question: If the increase amounts to nothing, then it won’t raise any revenue and why bother increasing the tax rate?

            Maxie: “I didn’t say it “amounted to nothing.

            Hold it right there:

            In the meantime, you keep avoiding the fact that these increases the President is demanding amount to nothing in real dollars

            Was that you?

            The small pinch of the higher bracket means nothing in the end.

            Was that you?

            The fact is this “tax increase” amounts to nothing. But everyone is making this a scrimmage line for the direction of the country.

            Was that you?

            Me, I would advocate a “Tobin Tax” and a tiny tax on stock transactions- that would raise billions and help to curb High Frequency Trading, which is killing our equity markets.

            Oh please explain that. Just how is high frequency trading “killing our equity markets”? I can hardly wait. This is bound to be good.

            It is estimate these increases will raise $900 billion over the next 10 years.

            That’s your idea of “amounts to nothing?

            Which is it, spin boy, is it something or nothing?

          • Max Planck says:

            “In the meantime, you keep avoiding the fact that these increases the President is demanding amount to nothing in real dollars”

            Was that you?

            “The small pinch of the higher bracket means nothing in the end.”

            Was that you?”

            I meant it amounted to nothing for those could easily afford to PAY IT. These increases would not affect their spending habits or have any negative economic effects. I’m glad you agree that the $900 billion revenue raise is substantial.

            HFT is one of the scourges of the current stock market. You have a tiny percentage of traders using algorithms accounting for 80% of the volume. There are two professional traders- Sal Arnuk and Joe Saluzzi of Themis Trading- who are fighting the good fight on this. The markets have become distorted, and the risk for more “flash crashes” is ever present.

            It’s a more critical issue than you think.

          • Methinks says:

            The hell you didn’t say that, Maxie. That was a cut and paste from your own comment. Have you lost the ability to scroll up and read your own gibberish? so, the question stands: how can something that “amounts to nothing” add up to $900 Billion? $900 Billion stolen from people is powerful disincentive, sparky. What leftard Magic Math are you using?

            Maxie: “I have no data on how much the cap gains and dividend increases”

            Blah blah blah. You have no data because you’re such a crack “financial professional” that you can’t look up simple graphs which have been around for decades. The answer is “nothing”. You’re an old geezer – certainly old enough to recall that tax rates used to be higher. Read it and weep, dippy. Just as Morgan has pointed out to you time and time again, incentives matter. Because people changed their behaviour and sought and received rents, higher tax rates did not increase revenue as a percentage of GDP or as a percentage of median household income. You know what that means, don’t you (she asks hoping its not a rhetorical question but knowing it probably is)?:

            [the link jettisons this into the spam filter, so google "mercatus" and "tax rates vs. Tax revenue" for the series of well-known graphs"]

            Maxie: “Me, I would advocate a “Tobin Tax” and a tiny tax on stock transactions- that would raise billions and help to curb High Frequency Trading, which is killing our equity markets.”

            Oh, let’s start with your deep envy of HFT guys. You aren’t the first moron who doesn’t know what an algo is, how the financial markets work or how to tie your own shoes but are certain that it all needs to be changed. Thanks mostly to technology and partly to our beloved and oh-so-benevolent SEC, HFT guys provide 70% of the liquidity in equities today. Without them, you’ve got nuthin’, honey. Sad but true. Now, how is it you’re planning to both curb HFT AND raise all this money? You’d lose the taxable P&L of HFT (HFT guys are short term traders and their P&L is taxed at the regular income tax rate, not the LT cap gains rate) so that you can collect a couple of basis points on half the transactions?!!! LMAOF!!! Only a moron would give up 35% on more transactions in exchange for 25bps on half (and I’m being generous) of the transactions and call it a win!!

            You can bitch about HFT all you want, sweetheart, but besides the technology genie not going back in the bottle, the SEC began to require algos from all of its stock Market Makers as of December 2010, so program trading is here to stay, despite an old luddite’s feeble objections. Either either keep or lose. A chump making a piddly $200K per year by the time he’s old and bald isn’t in these guys’ league and never will be. That’s your reality, baby. I don’t have to move my ass one millimeter to the right to trade the same securities on any other exchange around the globe. In the case of a transactions tax, trading would simply move from U.S. exchanges to….anywhere else in the world. That’s happened everywhere it’s been tried. Why do you think France’s new transactions tax only affects the most liquid stocks and assumes a loss of liquidity? And why do you think so much trading has moved to derivatives and out of equities in London? Now, I don’t have to school a crack “financial professional” that a loss of liquidity means an increase in volatility (hello, risk!) and transactions costs. Do I? Yes, I believe I do. And you want a transactions tax to make that situation even worse, slick.

            LOL! You’d know all this if you were an actual “financial professional” and not some punter with a zerohedge addiction cold-calling grandmas to fob off whatever trash your 7th tier brokerage firm happened to pick up in a bad trade. I can see you now: “You can’t lose on this, Jane. Scouts honour!”

          • Max Planck says:

            “You aren’t the first moron who doesn’t know what an algo is, how the financial markets work or how to tie your own shoes but are certain that it all needs to be changed. ”

            I know all about the algos and thank to a few people who won’t let the issue go away, so too does the SEC, which will take up the matter this year.

            “Thanks mostly to technology and partly to our beloved and oh-so-benevolent SEC, HFT guys provide 70% of the liquidity in equities today.”

            That’s the problem. You have machines trading stocks based on alogorithms- the computers don’t even know the NAMES of the equities they’re trading, but they have the ability to spot miniscule movements and “invest.”

            That’s not how markets are supposed to work, and the true value of the equities becomes distorted. There are great risks being imposed in the markets- including dozens of phony bids being submitted among other problems. Small wonder the retail investor has shunned the market. They think it’s rigged and they’re right. HFT is a curse.

            As far as your shrill, idiotic complaints about higher taxes amounting to “theft” I leave you to your own delusions.
            You’re worse than any imaginary welfare queen: things cost money, and they have to be paid for, and those who got 90% of the income gains over the past 12 years are the ones who should rightfully shoulder that burden.

            And the majority of the American people agree with that.

          • Max Planck says:

            “Because people changed their behaviour and sought and received rents, higher tax rates did not increase revenue as a percentage of GDP or as a percentage of median household income. ”

            Uh, no.

            http://www.businessinsider.com/sorry-but-this-republican-argument-about-taxes-is-bogus-too-2012-12

          • Methinks says:

            Ron H.,

            Max the Blank is so under-accomplished (yet so proud of it you’d have to think he’s the first in his family to not work at the post office) that he can’t imagine people make more than $340K.

            if you’re making $4MM per year, the deductions are pretty much meaningless. The 5 percentage point increase in taxes translates to close to an additional $200K in taxes. At $10MM, it’s $500K. That’s going to have an incentive effect – particularly since you generally need to work only a third as hard to earn half the amount you previously earned without reducing your consumption of goods and services (but significantly increasing your consumption of leisure) at all. Worse, the investment tax for this group is going up, so the incentive to consume is higher and the incentive to invest is now lower.

            I’m waiting for Maxie’s declaration that he has no sympathy for the son-of-a-bitches who dared to be far more talented and successful than he could ever dream of being. But, as you can see, my very point is the rich won’t be hurt. Plus, politicians are cheap and willing to hand out rents. What the hell, it ain’t their dough!

          • Max Planck says:

            “if you’re making $4MM per year, the deductions are pretty much meaningless”

            If you’re making $4 million a year, we should care less about the increase. The portfolio values of these people swings by more $$$ on an intraday basis than the tax.

            . “The 5 percentage point increase in taxes translates to close to an additional $200K in taxes. At $10MM, it’s $500K. That’s going to have an incentive effect – ”

            My heart is bleeding.

            “particularly since you generally need to work only a third as hard to earn half the amount you previously earned without reducing your consumption of goods and services (but significantly increasing your consumption of leisure) at all.”

            There is no direct correlation between the amount of “hard work” (or what you describe it as) and “success.”

            “I’m waiting for Maxie’s declaration that he has no sympathy for the son-of-a-bitches who dared to be far more talented and successful than he could ever dream of being.”

            You got it. And some of us humans have other ideas of what “success” in life means. I suggest you learn that.

          • Methinks says:

            but they have the ability to spot miniscule movements and “invest.”

            They’re not “investing”, genius. They’re trading and they are lowering the volatility and bid/ask spread. Two things you know nothing about.

            If you’re making $4 million a year, we should care less about the increase. The portfolio values of these people swings by more $$$ on an intraday basis than the tax.

            Contrary to what you believe, this is not a contest to see who can say the dumbest, most irrelevant and pointless thing on the thread. If it were, you’d have won long before you crapped out this doozy.

            There is no direct correlation between the amount of “hard work” (or what you describe it as) and “success.”

            Not in your case. You’ve been busting your empty skull against a brick wall for 40 years and you’ve only just made it to below average.

            And some of us humans have other ideas of what “success” in life means. I suggest you learn that.

            LOL! This from a guy who declared his superiority on this very blog on the bases of his income, price of his house and that his property taxes are too high (they’re insane, btw)? I certainly think that success is not defined by the amount of material crap you have or the amount of money you earn. May there never come a day when I am so poor that all I have is money. But YOU, pumpkin, so clearly do define people by what they have. So that makes your above statement the BS losers like you tell themselves as they cry themselves to sleep in their tear-downs in them midst of much more successful people.

          • Max Planck says:

            “They’re not “investing”, genius. They’re trading and they are lowering the volatility and bid/ask spread. Two things you know nothing about.”

            They are most certainly NOT “lowering volatility” and if you believe that markets are there for price discovery, than you have to know that what these guys do doesn’t help.

            The rest of your post is the usual shrill flailing of a demented old fascist.

            I’m going to enjoy 2013. Squirm, mutt.

          • Methinks says:

            I meant it amounted to nothing for those could easily afford to PAY IT.

            Well, that explains why in 60 years on this planet you have finally clawed your way up to below mediocre. It’s not a matter of what one can afford, it’s a matter of whether someone will find incentive to expend the marginal energy to create the marginal dollar that they will not get to benefit from. They won’t. the wealth won’t be created, there won’t be additional income to tax and you’ll get slower growth to boot. If you were a real “financial professional” earning an income that implied you were any good at it, Morganovich and I wouldn’t have to keep trying to drill these basic facts into your empty skull.

            HFT is one of the scourges of the current stock market.

            Lemme translate this for everyone: Maxie Blank doesn’t know what HFT is exactly and can’t explain why it’s such a “scourge”, but since Zerohedge tells him it is, he’s all for it. Besides, those guys are much smarter and richer than he is and that irritates him to no end.

            That’s not how markets are supposed to work, and the true value of the equities becomes distorted. There are great risks being imposed in the markets- including dozens of phony bids being submitted among other problems. Small wonder the retail investor has shunned the market. They think it’s rigged and they’re right. HFT is a curse.

            Oooh, lookie! A copy-paste directly from Zerohedge with no processing by Maxie’s non-existent brain. Do tell us, genius, how exactly (in detail) does HFT “rig” the market. What is a “phony bid” and what exact effect does it have, including the how it hurts the order trying to hit it and how it benefits the entity posting it. Step-by-step. Show us you know what you’re talking about! And don’t forget to explain how SEC Reg Sho rule 204 affected the market and especially the deviations from fair value in medium to low liquidity stocks. Or will you just blame that on HFT too? This oughta be good!

            You’re worse than any imaginary welfare queen:

            Of course I am! I don’t advocate the theft of the product of other people’s labour – and I didn’t even when I was as poor and poorer than you are. So in your upside-down leftard world, that makes me worse than your fellow thieves. That’s the other thing you say to soothe yourself as you cry yourself to sleep at night.

            things cost money, and they have to be paid for, and those who got 90% of the income gains over the past 12 years are the ones who should rightfully shoulder that burden.

            Of course! The reasoning of a common thief: Things I value cost money and people who have money should be forced to pay for my consumption of things I value and don’t wish to work for or make trade-offs to acquire. Thus, it it is perfectly logical that a gun should be held to their heads and their property expropriated to be given to me. And I am just dumb enough to think they will keep producing things for me to easily steel.

            And the majority of the American people agree with that.

            Argumentum ad Populum. Excellent!

            Happy Fiscal Cliff! Or, really, have a good time going over that much more important Communist Cliff! Don’t bump your head when you hit the ground….not that a concussion wouldn’t improve you.

          • Max Planck says:

            “Well, that explains why in 60 years on this planet you have finally clawed your way up to below mediocre. It’s not a matter of what one can afford, it’s a matter of whether someone will find incentive to expend the marginal energy to create the marginal dollar that they will not get to benefit from.”

            Bullsh&t. From time immemorial, no one who was successful (no matter how you define it) ever gave a crap about taxation. Most people strive to do better, and it is their nature to do so.

            I didn’t copy and paste anything from Zerohedge and there is little that I agree with him on, anyway. These guys are leading the charge, and they’re getting their voice heard:

            http://www.amazon.com/Broken-Markets-Frequency-Destroying-Confidence/dp/0132875241/ref=sr_1_1?ie=UTF8&qid=1356973890&sr=8-1&keywords=joe+saluzzi

            No doubt you have a dog in the hunt, so you’re fine feathering your own nest at the expense of the general market.

            “Argumentum ad Populum. Excellent!”

            Wow. Impressive. I guess we should succumb to the dictatorship of people like you, who are so morally superior to the rest of the nation.

            Maybe you should go start your own country, based on the principles you espouse. Or you could move. I recommend any Third World nation. No government, no revenues, no services.

            Paradise.

          • Methinks says:

            the computers don’t even know the NAMES of the equities they’re trading, but they have the ability to spot miniscule movements and “invest.”

            I just couldn’t leaive this little ditty unanswered. Translation: when the algos notice that the stock has moved from fair value, they calculate positive edge in either buying or selling the stock (depending on whether the move was up or down). The algos then execute a trade and, in doing so, move the price to fair value. The benefit to other market participants is that a buyer or seller has a much higher probability of executing his order at or very near the the fair value price and this quick action reduces the price volatility of the stock as well as the transactions cost by reducing the bid/ask spread.

            Our resident idiot, Maxie Blank, thinks that keeping prices in line with fair value is a “scourage” and would rather prices deviate hugely from fair value, by definition increasing volatility and the bid/ask spread. I’m sure that his reasoning will follow the typical line of how much benefit you will get and how much more volume the market would have if only you increased risk and costs for participants. I love this guy. He is the funniest thing I’ve seen on the internet in a long time.

          • Max Planck says:

            “The algos then execute a trade and, in doing so, move the price to fair value”

            So you claim. Many others are not of the same opinion, and I would not call them “idiots.”

          • Methinks says:

            The rest of your post is the usual shrill flailing of a demented old fascist.

            That’s it, Pookie! Gimme all you got!

          • Max Planck says:

            “That’s it, Pookie! Gimme all you got!”

            More than you’ll ever amount to. Stupid old ugly harridan.

          • Methinks says:

            No doubt you have a dog in the hunt, so you’re fine feathering your own nest at the expense of the general market.

            Yeah! That must be it. Is that supposed to pass for an explanation of why HFT is such a scourge and why what I say about liquidity is wrong? That and your sudden embrace of zerohedge? come on, Maxie, explain to the class step-by-step the things you can’t wrap your mind around.

            I set an impossible task for you, pumpkin. Sigh.

          • Max Planck says:

            “Yeah! That must be it. Is that supposed to pass for an explanation of why HFT is such a scourge and why what I say about liquidity is wrong? That and your sudden embrace of zerohedge?”

            As I said, I don’t even follow Zerohedge that much, and what little I see of his stuff I don’t even agree with.

            Keep slapping those phony bids out. The American people thank you.

          • Methinks says:

            More than you’ll ever amount to. Stupid old ugly harridan.

            Maxie: “Nyah-nyah, ugly stupid head!”

            Spectacularly elevated insult, Maxie. Is this the best a critter so jealous can come up with after 60 years of slithering on this planet? Surely you can do better! Aren’t you good at ANYTHING?

          • Max Planck says:

            “Spectacularly elevated insult, Maxie. Is this the best a critter so jealous can come up with after 60 years of slithering on this planet? Surely you can do better! Aren’t you good at ANYTHING?”

            For people who claim to be so intellectually superior, you sure do act like a 6 year old brat.

          • Methinks says:

            Oh no, Maxie-poo. I never claimed superiority of any kind. I merely merrily let you eagerly jump into your own traps.

            BTW, is this meant to distract us from the fact that you have yet to answer any of the questions we so eagerly await with regard to HFT and the causes of market volatility and loss of liquidity? We eagerly await a lesson from such a sage as yourself. In your own words, darling.

          • Ron H. says:

            I meant it amounted to nothing for those could easily afford to PAY IT. These increases would not affect their spending habits or have any negative economic effects.

            Oh wow. That’s amazing. Now you can determine for others what they can afford and how they will be affected? Not bad for someone who just manages to max their FICA deduction!

            What do you suppose those high earners were doing with that $200k/yr before now? Was it anything useful or did they just stuff it in the mattress along with the rest of their ill gotten wealth? Now it will be MUCH better spent by morons in government.

            I’m glad you agree that the $900 billion revenue raise is substantial.

            I didn’t agree it was substantial, I said it certainly wasn’t – what’s your description – nothing. That was it. You said it was nothing.

            It’s a more critical issue than you think.

            And now you believe you know how critical I think this issue is?

            You seriously need to get a grip.

            You will notice I chose not to discuss HFT because I don’t know a lot about the subject, unlike you, for whom lack of knowledge is no barrier. But, as luck would have it, Methinks seems to know a lot about HFT and is seriously kicking your ass.

            You just don’t know when to quit, do you?

          • Max Planck says:

            “You will notice I chose not to discuss HFT because I don’t know a lot about the subject, unlike you, for whom lack of knowledge is no barrier”

            Uh-huh.

            let’s start off with the main problem, which has mestaticized into a tiny percentage of participants now doing over 75% of the trades.

            I don’t give a f*ck what you make off this racket, but if you give a damn about markets acting rational for the benefit of the overall society and who it is supposed to serve, that is utterly perverse.

            Secondly, you can can the “price discovery” BS. This piece, provided by the good folks at Themis Trading who are exposing your ilk, says it best:

            We have heard the term “momentum ignition” tossed around a lot lately. A recent Credit Suisse report said that momentum ignition was an HFT strategy. They defined momentum ignition as when “an instigator takes a pre-position; instigates other market participants to trade aggressively in response, causing a price move; then trades out.”

            A new paper titled “Exploratory Trading” written by Adam Clark-Joseph from Harvard University attempts to explain how high frequency traders use exploratory trading techniques (or momentum ignition) to make their profits. The theory goes that HFT’s will probe with small aggressive orders that will often lose money so that they could find out more important market information that they could then take advantage of. The study was done using actual CME data for the period of September 17, 2010 to November 1, 2010 (as opposed to other sponsored pro-HFT studies that have used the same old stale stock exchange provided data which does not even drill down to the user level). During this period, over 41,000 accounts traded and HFT’s were less than 0.1% of these accounts but were responsible for 46.7% of the trading volume and earned an average of $1.5 million per day. The author states:

            “Of the 30 high-frequency traders (HFTs) that I identify in my sample, eight earn positive overall profits on their aggressive orders. I find that all eight of these HFTs consistently lose money on their smallest aggressive orders, and these losses are NOT explained by inventory management. These losses on small orders, as well as the more-than- offsetting gains on larger orders, could be rationalized if the small orders provided some informational value, and I model how a trader could gather valuable private information by using her own orders in an exploratory manner to learn about market conditions.”

            “The private information about price-impact generated by an HFT’s small aggressive orders enables that HFT to trade ahead of predictable demand at only those times when it is profitable to do so (i.e., when price-impact is large).”

            “Fundamentally, the model of exploratory trading rests on the notion that an HFT’s aggressive orders generate valuable private information, specifically, information about the price-impact of the aggressive orders that follow. When an HFT places an exploratory order and observes a large price-impact, he learns that supply is temporarily inelastic. If the HFT knows that there is going to be more demand soon thereafter, he can place a larger order (even with a big price-impact) knowing that the price-impact from the coming demand will drive prices up further and ultimately enable him to sell at a premium that exceeds the price-impact of his unwinding order. When an HFT knows that supply is temporarily inelastic, he follows a routine demand-anticipation strategy. The purpose of exploratory trading is not to learn about future demand, but rather to identify the times at which trading in front of future demand will be profitable.”

            HFT’s will likely say that this exploratory trading is actually helping in the price discovery process but the author disagrees:

            “The information that exploratory trading generates does not relate directly to the traded asset’s fundamental value, but rather pertains to unobservable aspects of market conditions that could eventually become public, ex-post, through ordinary market interactions.”

            Our friends at Nanex yesterday published a piece titled Orchestrating Chaos where they graphically show what momentum ignition looks like. They state:

            “On December 26, 2012 at 11:02:59, the market suddenly exploded with activity (SPY dropped below 141.88 – a low set 12 days earlier on December 14). Approximately 3,800 March 2013 eMiini futures contracts (S$P 500) were sold during that second. We thought the sudden explosion in activity warranted a closer look. What we found was fascinating. It appears the entire market-wide move may have been carefully orchestrated.”

            “Exploratory Trading” or momentum ignition has nothing to do with the fundamentals of the stock market.

            It is nothing more than a high-tech version of scalping. The Harvard paper also strikes as just the opposite of the HFT claim that they “add liquidity”. Maybe HFT’s are defining “add liquidity” as layering the book with higher offers and then sending some exploratory aggressive bids out to the market in an attempt to have others jump ahead and lift those layered offers. If that’s their definition, then we think regulators may take issue with it.

          • Max Planck says:

            “I’m glad you agree that the $900 billion revenue raise is substantial.”

            I didn’t agree it was substantial, I said it certainly wasn’t – what’s your description – nothing. That was it. You said it was nothing.”

            Madam, you’re attempting to be cute here, and it’s not working.

            Otherwise you wouldn’t have been squealing like a pig over the tax increases.

        • Methinks says:

          Eagerly, eagerly, eagerly, darling! Dazzle us with your genius! Go!

      • Che is dead says:

        “I’m someone who maxed out his Social Security contribution for most of his life. Which I doubt few of the posters here ever have accomplished.” — Max

        Only a half-wit would consider this an accomplishment.

    • Methinks says:

      Luther, I’m sure you understand the many reasons your comment doesn’t mean tax rates don’t matter. I won’t pry into your personal life and I don’t know what your tax rates, deductions, ambitions, etc. are.

      I will only ask if you will work more work regardless of the tax rate. Will you, for example, take a promotion if the tax rate on the marginal dollar is 80%, 90% or even 100%? That you are currently not at the margin is fine, but your margin is somewhere and other people may be at the margin. I have been working for a long time and I could have retired years ago. I run my own business and I certainly know that the tax rate increase next year is going to make my leisure time awfully cheap, so I’ll take more leisure and will only expend effort in pursuit of tax-advantaged opportunities. Otherwise, I’ll be at the beach.

  4. PeakTrader says:

    Unfortunately, government tends to create expensive problems and then comes up with costly solutions.

  5. Greg G says:

    Thanks for being honest enough to admit here that it is a regressive income tax system that you really long for.

    • Methinks says:

      You really missed your calling as spin artist for mass media. I mean, you’re totally transparent and unconvincing, but so are they. You’d fit right in.

      BTW, not that I expect you to be able to wrap what passes for your brain around this, but it is you Regressives who actually impose the regressive tax on the least advantaged and most defenseless with all the vote buying in the form of redistribution, racist quotas and minimum wage you try to re-package and sell to the world as compassion.

      • Greg G says:

        I did not “spin” anything Methinks. Mark advocated for “a regressive income tax system” here using exactly that term. I merely thanked him for his honesty in doing that. If you find that “unconvincing” then you need to reread his post and my comment.

        I did enjoy the irony of you drawing conclusions about racist quotas and minimum wage (neither of which I said a word about) while complaining about “spin.”

        • Methinks says:

          Oh, that wasn’t spin. Sorry. My bad. That was just stupidity on your part. You’re just too dumb to be able to tell the difference between a hypothetical question and advocacy.

          If you’re not lying then you’re just dumb. Those are pretty much the only two ways that you can write what you did. So which is it, Greg? Are you a liar or an idiot?

          • Greg G says:

            Of course it was a hypothetical question. It had to be a hypothetical because we all know it will never happen. He was advocating for a hypothetical regressive income tax system as a better system of incentives. It is entirely possible to advocate for a hypothetical system and that is exactly what he did here.

          • Methinks says:

            Ok. So, you’re saying you’re an idiot. No problem. I just wanted to clear that up.

      • Che is dead says:

        Amen, sister.

  6. Max Planck says:

    “Importantly, a progressive income tax system creates strong disincentives to be productive, because the most successful individuals get taxed (and penalized) at higher marginal rates as they earn more income, at combined federal and state tax rates that could approach almost 50 percent of the last dollar earned.”

    The reductio ad absurdum of this piece is proven by the fact we have had a progressive income tax system for decades.

    Who would assess the United States of America as being “unproductive” after all this time?

    And the flat tax? Forget it. It’ll never happen.

  7. kleht says:

    “If every U.S. taxpayer purchased a gallon of milk, each person would pay $2.49, and the total cost would be 140.5 million times $2.49 — or $349 million.

    Now let’s assume the government treated milk like government services and determined its price the same way it determines tax rates. The pricing would change as follows:

    When the bottom 40 percent of earners buy their milk, they won’t pay a dime for it. In fact, the government would give them $1 in reverse payments for every gallon of milk they purchase. The total cost of providing one gallon of milk to each person in this group would be $196.1 million.

    The cost of providing milk to the remaining 60 percent of the taxpayers would be $209.9 million, bringing the total cost burden of all taxpayers’ milk to $406 million.

    Under our existing tax rates, instead of paying $2.49 a gallon, the top 1 percent of earners would pay 38 percent of the total milk burden or $109.81 for a gallon of milk.”

    Hey, this sounds like a great idea! The poor would get free milk (and sustenance) and get paid for it. The very wealthy would pay a fortune for milk. After all, they have the available funds and are not likely to starve. To make it even better, this could be built into the tax system. The wealthy could deduct all costs of living and the poor would have more income to be taxed. Sounds like a winner all the way around.

    Oh, but then we would have to have tax reform. Good luck!

  8. Benjamin Cole says:

    “Don’t tax you, don’t tax me, tax that man behind that tree!”

    Former Senator Russell Long, D-LA, Senate Finance Committee Chairman.

    How about a flat tax? Start off with a flat tax to finance Social Security. Dump the wage tax on just the first $100k in wages. Tat is a disincentive to work.

    A 2 percent tax on all income, whether wages, capital gains, interest income, rents from property etc.

    Oh? What happened? No more support for flat taxes? Oh gee, why?

  9. PeakTrader says:

    Over $1 trillion a year of government services (through federal budget deficits) we don’t pay for. What a deal.

  10. LarryG says:

    re: ” The reductio ad absurdum of this piece is proven by the fact we have had a progressive income tax system for decades.

    Who would assess the United States of America as being “unproductive” after all this time?”

    well Max… they seem to flock to this site led by their leader Perry!

    funny how the vast majority of these “posts” sooner or later degenerate into anti-govt rants, eh?

    • SeattleSam says:

      Have you considered the possibility that there would be far less “ranting” if government stuck to the functions outlined for it in the Constitution instead of pursuing the impossible task of trying to regulate so many aspects of human behavior? That there would also be far less ranting in a forum about economics if government actually did whatever it does in an efficient manner? For some reason it’s considered good practice to loudly chastise charities that operate with high levels of overhead and revenue raising/spending inefficiencies. Why should government not be subject to the same critique? If the United Way operated the way government does, would you be urging everyone to direct more of their charitable giving to them?

      • LarryG says:

        ” Have you considered the possibility that there would be far less “ranting” if government stuck to the functions outlined for it in the Constitution instead of pursuing the impossible task of trying to regulate so many aspects of human behavior?”

        I have, indeed but it seems that every single industrialized country in the world, each with a separate and different Constitution have agreed that a progressive tax system is valid.

        What’s really absurd here is the fact that Perry picks a GAME instead of a COUNTRY to make his point.

        Why does he pick a GAME instead?

        the idea that “incentives matter” is total idiocy when used in this context.

        It would be like arguing that sales prices are not as good as “free”.

        no taxes would be nice but then you’d have a 3rd world country,

        If these kinds of incentives “matter”, then why have we had a progressive tax system for DECADES and we have been and remain one of the most potent economies in the world – including countries that have no taxes or have the “proper” tax incentives – like regressive tax.

        it’s just plain Grade A Libertarian BLATHER with zero examples in the 200+ “governments” in the world.

      • LarryG says:

        ” For some reason it’s considered good practice to loudly chastise charities that operate with high levels of overhead and revenue raising/spending inefficiencies. Why should government not be subject to the same critique? ”

        what in the world does that have to do with “incentive” tax policies?

        in terms of efficiencies – are you saying that the govt has some pretty good stats on administrative costs for Medicare and the Govt employee 401K program called TSP? Or the efficiency of the NTSB or FDIC?

        or do you ignore the good examples and focus on the bad and claim the bad is representative of govt – all govt and that justifies getting rid of govt?

        you’re not only on a slippery slope – but it has a 75% slant to it – over and over – right down to “govt is bad”, “get rid of govt”.

      • Max Planck says:

        “Have you considered the possibility that there would be far less “ranting” if government stuck to the functions outlined for it in the Constitution instead of pursuing the impossible task of trying to regulate so many aspects of human behavior?”

        Welcome to the 21st Century. First, the government is NOT “trying to regulate so many aspects of human behaviour,” but of course, like most people, you won’t object when it facilitates YOUR behaviour! I mean, if you were a current homeowner, you surely would have no objection to having your mortgage interest deduction, and property tax deduction stripped from you in the name of economic purity, right?

        ” That there would also be far less ranting in a forum about economics if government actually did whatever it does in an efficient manner? For some reason it’s considered good practice to loudly chastise charities that operate with high levels of overhead and revenue raising/spending inefficiencies. Why should government not be subject to the same critique? If the United Way operated the way government does, would you be urging everyone to direct more of their charitable giving to them?”

        A common rant, and one based on little more than prejudice. ALL large enterprises are wasteful, and layered with beaurocracy. Anyone who has stayed in a large metropolitan hospital, or tried to dispute a claim with an insurance company, knows what it’s like to wrestle with a large organization, public or private. There are plenty of private enterprises out there that are LESS efficient than government’s, and to just blindly accuse it of being “wasteful” and “inefficient” doesn’t really mean anything. That doesn’t mean we shouldn’t demand it. But the USG isn’t using Frieden calculators either.

        • Methinks says:

          the government is NOT “trying to regulate so many aspects of human behaviour,…

          It always seems that way to an imbecile like you. You’re just smart enough to figure out that you’re not smart enough to be able to choose your own school or a school for your idiot offspring, let alone how much sugar and salt should be in your food. Morons like you submit to government because submission is all they’re capable of.

          • Max Planck says:

            “It always seems that way to an imbecile like you. You’re just smart enough to figure out that you’re not smart enough to be able to choose your own school or a school for your idiot offspring, let alone how much sugar and salt should be in your food. Morons like you submit to government because submission is all they’re capable of.”

            Substantive commentary, as always. There’s just no matching the delicacy of your charms.

          • Methinks says:

            Yes, Maxie, what I really care about is that a worthless moron who brags about a pitiful salary and admits he can’t make the most banal decisions without the nanny state spoon-feeding him finds me charming on the internet. Good thinking. You read me so well!

          • Max Planck says:

            “Yes, Maxie, what I really care about is that a worthless moron who brags about a pitiful salary and admits he can’t make the most banal decisions without the nanny state spoon-feeding him finds me charming on the internet. Good thinking. You read me so well!”

            Do you intend to ever actually DISCUSS an issue, or are you here to compensate for your obvious feelings of inferiority by ranting at people like a street corner drunk?

          • Methinks says:

            You are claiming higher ground based on these subsitantive intellectual ditties of yours, of course:

            “Polly want a cracker?”
            “OH, SCREW YOU, YOU MORON!!”
            “You can stamp your feet all you want. Dope.”
            “Free your minds, kiddies.”

            I particularly like “OH, SCREW YOU, YOU MORON!!” and the dope thing because that was in response to Morganovich who lowered himself to politely provide substantive rebuttals to your rivers of pure shit. I am not possessed of Morgan’s endless hope and good nature. Basically, when I see a worthless thief like you, I just go ahead and treat him with all the respect he deserves.

          • Max Planck says:

            “I particularly like “OH, SCREW YOU, YOU MORON!!” and the dope thing because that was in response to Morganovich who lowered himself to politely provide substantive rebuttals to your rivers of pure shit”

            He was proven flat wrong, again and again. Like most, they don’t concede, declare victory, and move on.

          • Methinks says:

            He wasn’t proven wrong by you. You couldn’t even comprehend 98% of what he said to you. It was shocking. Then again, I shouldn’t be surprised. Morgan is a successful hedge fund manager. You know, unlike you, he’s an actual success. so And even if you did prove he was wrong about something “SCREW YOU, YOU MORON!!!” (in all caps, no less) hardly gives you a leg to stand on when criticizing similar responses to you for their lack of respect or substantive content. You will no more understand this than a rat understands he’s rat. That’s why I don’t bother frustrating myself with substantive responses to your crap and skip directly to the fun of watching you puff up your chest to make yourself seem more important than you are. It’s fun!

          • Max Planck says:

            “He wasn’t proven wrong by you. You couldn’t even comprehend 98% of what he said to you”

            Are you lonely, madam?

          • Paul says:

            “He was proven flat wrong, again and again. Like most, they don’t concede, declare victory, and move on.”

            I think everyone other than your mentally challenged sidekick Larry called it for Morganovich. You got your ass kicked and chose to lash out with rhetorical fists of fury.

            Great fun!

          • Max Planck says:

            “I think everyone other than your mentally challenged sidekick Larry called it for Morganovich.”

            If so, it’s merely testimony to how people blindly cling to their belief systems. You never change the other fellow’s mind, no matter what the proof, so after spending years on various political forums, I’m not surprised.

            Again, it’s easier to train a dog than a person. Stick the dog’s nose in his poop, and he will bring his own leash to you when he needs to go. Stick hard data in someone’s face that confronts the fantasy they’ve constructed for themselves, and they’ll go on denying it.

            It would be like convincing the Pope that the Virgin Birth was a myth. I’m quite convinced that it is, but he’s not going to change his mind for me. He’s got too much riding on it.

          • Max Planck says:

            Paul, this is what you thought was Morgan’s “brilliant” retorts?

            “max-

            a right to suffrage is irrelevant.

            if a majority of people supported slavery, would that make it OK?

            tyranny of the majority is still tyranny.

            our constitution gave primacy to the rights of the individual, not the will of the demos.

            find me the clause in the constitution that allows the federal government to operate welfare, social security, health care programs, or redistribute wealth.

            don’t forget:

            “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”

            if it is not explicitly there, then it is not constitutional.

            the power to tax is NOT the power to spend such money on wealth redistribution.

            your grasp of the constitution seems even worse than your grasp of tax policy.”

            If so, it underscores what I said prior.

          • Methinks says:

            Oh, Lord. Now Maxie is propositioning me. I’ll never ever be lonely enough to look your way, darling. It’s a super slow day as we await Fiscallus Clifftivus and I’m really bored. Why else would I be toying with you on the internet?

          • Max Planck says:

            Madam, with your display of feminine charm and delicacy, a Great Dane wouldn’t proposition you.

          • Methinks says:

            So, you’re telling me that your standards are lower than a dogs? Why would you admit that in public, Maxie?

          • Max Planck says:

            No, I’m telling you the dog is too good for you.

            Keep up.

          • Methinks says:

            Well, it’s understandable that a normal person can’t keep track of the bizarre fantasies spat out by a deviant and disorganized mini-mind.

          • Paul says:

            Maxi Pad,

            “Paul, this is what you thought was Morgan’s “brilliant” retorts?”

            I don’t see anything wrong with what you posted, but you’re only posting snippets. I could do the same thing and just post your insults, though I must admit you do get points for occasionally funny insults.

            You are certainly entertaining. I hope getting your ass kicked by people like Methinks and Morganovich doesn’t stop you from coming here and jumping up and down looking for attention and validation of your self-worth.

          • Max Planck says:

            “You are certainly entertaining. I hope getting your ass kicked by people like Methinks and Morganovich doesn’t stop you from coming here and jumping up and down looking for attention and validation of your self-worth.”

            If you think their retorts- and your own- have any substance to them, it only underscores my point. People won’t admit they’re wrong no matter what the evidence.
            From my point of view, Morganovich lost every volley he served, but I guess that doesn’t carry anything with you.

            As far as Methinks rubbish, help yourself.

          • Paul says:

            “You first.”

            Actually, I did admit the other day you were right about the
            “90% of homeowners are current” thing. I misread what you wrote and it blew up in my face. Admitted it, couldn’t care less. Ha, so you’re wrong, not that you’d ever admit it…

            “Maxi pad…” I’ll bet you’re a real producer.”

            I didn’t thing that insult would have much zing, but I guess I underestimate the fragile ego of a blowhard. Good to know. :)

          • Max Planck says:

            “90% of homeowners are current” thing. I misread what you wrote and it blew up in my face ”

            You didn’t misread anything. I made a statement, based on my knowledge of the housing market, which I follow closely, and it should be OBVIOUS to you that I follow closely.

            Your produced an article that was supposed to refute me. It backed me up instead.

            You simply believed what you wanted to because you thought most underwater homeowners were skipping out on their mortgages. Their not.

            That should give you pause as to what else you don’t know

          • Methinks says:

            You mean you aren’t bothered by being wrong and learning something new on occasion, Paul? That doesn’t make you feel like less of a man? Next thing we know you won’t even post the market value of your family home, your income, or your property taxes in an effort to convince us you’re a somebody!

            I guess you really are different from Max the Plank :)

          • Paul says:

            “You didn’t misread anything. I made a statement, based on my knowledge of the housing market, which I follow closely, and it should be OBVIOUS to you that I follow closely.”

            Hear Hear, everyone bow down and recognize Maxi Pad’s genius!

            Who gives a shit? I’ve bought low, sold high, and flipped several foreclosure homes in Phoenix over the past few yrs. You don’t see me thumping my chest over it.

            “Your produced an article that was supposed to refute me. It backed me up instead.”

            See, you’re wrong again. Juandos produced an article. I read it and forgot what you wrote. I conflated “underwater” with “current on payments” and you slayed me. :) Go look at the thread and then come back and admit you’re wrong. Oh wait, you never admit you’re wrong…

            “You simply believed what you wanted to because you thought most underwater homeowners were skipping out on their mortgages. Their not.”

            Did not. Did not. Quote back to me where I said most underwater homeowners were skipping out on their mortgages.

            Wrong again, old man!

            “That should give you pause as to what else you don’t know”

            That should give you pause as to what else you are wrong about.

          • Max Planck says:

            “Hear Hear, everyone bow down and recognize Maxi Pad’s genius! ”

            That’s right- kiss my ass.

          • Max Planck says:

            “I conflated “underwater” with “current on payments” and you slayed me.”

            You’re a house flipper who conflated these two terms.

            Got it.

          • Methinks says:

            Yeah but, Maxie-poo, Paul carelessly conflated some crap he read on an internet comment section. You, on the other hand do the conflating in real life. Which is probably why you live in a tear-down, albeit in one of the highest income parts of the country (which is kinda unimpressive since you live within commuting distance to NYC).

            This is what $800K gets you in one of the highest income areas just outside NYC: http://www.realtor.com/realestateandhomes-detail/Greenwich_CT_06831_M48616-04937

          • Max Planck says:

            “Yeah but, Maxie-poo, Paul carelessly conflated some crap he read on an internet comment section.”

            Of course, darling! ANY real estate professional would EASILY “conflate” the two terms, just as someone would confuse you with Princess Grace of Monaco.

            No problem. Point taken!

          • Ron H. says:

            If you think their retorts- and your own- have any substance to them, it only underscores my point. People won’t admit they’re wrong no matter what the evidence.

            So says Max the poster child for his own assertion.

            ROFL

          • Max Planck says:

            “So says Max the poster child for his own assertion.”

            Back to the sandbox for Ron H.

          • Ron H. says:

            Methinks

            Is this your kingly castle, Maxie?

            Well yes, it is, but it turns out it’s his mother’s house. On his kingly salary Maxie can only afford to live in the basement.

            I believe he is acquainted with Sethstorm.

        • Paul says:

          Maxi Pad,

          “People won’t admit they’re wrong no matter what the evidence.”

          You’re a funny dude. Look in the mirror.

          • Max Planck says:

            “Maxi Pad,

            “People won’t admit they’re wrong no matter what the evidence.”

            You’re a funny dude. Look in the mirror.”

            You first.

            “Maxi pad…” I’ll bet you’re a real producer.

  11. Richard says:

    Mark,

    You need to re-edit the first paragraph. I think you have a copy-past-edit error in there.

  12. Norman says:

    Just ask a sales manager the effect of reducing a salesman’s percentage take from a commission as he does more and more business. The salesman will do less and less business. Same with tax rates. But the simplistic approach towards taxation warms the heart so much that reality will not be let in. This is a cyclical issue. When the ‘take’ is less then ‘projected’ we’ll revert back to sanity but not until. The same goes with the nationalization of industries which Mexico has found out over decades of fighting this emotional issue.

  13. Zachriel says:

    Mark J. Perry: That is, we would do away with the progressive tax system of increasing disincentives for earning income, and we would implement a regressive income tax system that rewards successful income-generating activities the way bowling success is rewarded.

    They had a regression tax system in the Middle Ages. The peasants paid, and the rich collected. Worked quite well—if you were rich.

  14. Zachriel says:

    Mark J. Perry: That is, we would do away with the progressive tax system of increasing disincentives for earning income, and we would implement a regressive income tax system that rewards successful income-generating activities the way bowling success is rewarded.

    They had a regressive tax system in the middle ages. The peasants paid and the lords received. Worked pretty well—for the lords.

  15. Dagbone says:

    None of these arguments make any sense at all unless you believe that taxation is equivalent to PUNISHMENT. It isn’t. The role of taxation is FINANCE, as in, “How do we finance the functions of government that the majority of us find value in?”

    In that light, a progressive system at least makes some sense: We’ll get most of the money from people who actually HAVE MONEY. I can’t argue that the converse would be better.

    Nobody needs a tax incentive to get rich… getting rich is its own reward. Nobody says, “Well, gee, I don’t think I want to get rich because the tax system is unfair.” You also don’t need the tax system to sweeten the pot. Nobody who has gotten rich will tell you, “You know, if I had it to do all over again, I wouldn’t have worked so hard to get rich because the tax system is unfair.”

    Can’t we elevate the narrative just a bit?

    • LarryG says:

      re: ” Can’t we elevate the narrative just a bit?”

      not when Methinks and company are on a tear…

      any attempt at rational conversation is verboten if it violates methinks and company’s belief systems and the ‘moron” invectives” flow like sewage from a whore house.

      • Paul says:

        “…any attempt at rational conversation is verboten if it violates methinks and company’s belief systems and the ‘moron” invectives” flow like sewage from a whore house.”

        Sometimes they are insults and sometimes just honest assessments. Take you for instance: you believe there’s an unusually large amount of sewage that flows from whore houses.

        Moron.

    • Walt Greenway says:

      Dagbone, there’s no doubt that decisions are made with our federal taxation system that would not be made otherwise. You just accept it and move on. A hundred years of history and our current two-party system tells me to think that we will ever have a flat-rate federal income tax is delusional.

      Now, I have to to decide whether to back-door my Roth IRA or do a 401(k) Roth conversion this year or next year. No investment decision can be made without considering the tax consequences.

      • LarryG says:

        re: ” …flat-rate federal income tax is delusional.”

        as are much of the blather that emits from the mouths of the Libertarian types here…..

        they say: “incentives matter”…

        so the very best incentive is no taxes at all…

        rational thought tortured to death…. QED

        • Ron H. says:

          so the very best incentive is no taxes at all…

          Oh Wow! You actually got one right.

          I’m sure it was unintentional. Don’t worry. Your reputation as a moron hasn’t been hurt.

    • Methinks says:

      Dagbone,

      I find it a little amusing that you seek to “elevate the narrative” by employing the logic of a common thief.

      A thief would also like to have his consumption paid for by an unwilling party. He reasons that since he finds something valuable, but doesn’t have the means to pay for it, he should obtain those means from someone who does and it’s okay to use force to do so. You argue that paying out of your own pocket for things you find valuable is not better.

      If this is what passes for “elevated narrative”, then we might as well pack it in. We are barbarians.

      re your final paragraph: Nobody needs incentive to become rich. What we need is an end to the DISincentives to produce. If I take more and more from you as you work harder and harder and take more and more risk, will you continue to strive harder? Especially if you can get government to meet your needs by taking what you want from someone else? Why would you bother?

      • LarryG says:

        re: ” If I take more and more from you as you work harder and harder and take more and more risk, will you continue to strive harder? Especially if you can get government to meet your needs by taking what you want from someone else? Why would you bother?”

        CLEARLY and without question, taxation will cause you to stop producing and become a taker…

        Methinks – you are BRILLIANT!

        • Methinks says:

          I only seem that way to you because you find simple concepts very difficult to wrap your mind around.

          • LarryG says:

            re: ” …you find simple concepts”

            friendly amendment: simple-minded libertarian concepts.

            indeed…

          • Paul says:

            Methinks,

            “I only seem that way to you because you find simple concepts very difficult to wrap your mind around.”

            Especially the whole “working harder and harder” thing. Now there’s a concept that puts a deer-in-the-headlights look on Larry’s face.

          • Methinks says:

            LOL!

            If you think that’s bad you should see him when he’s faced with the illusive concept, “voluntary”.

          • Ron H. says:

            If you think that’s bad you should see him when he’s faced with the illusive concept, “voluntary”.

            Or “supply and demand”!

    • SeattleSam says:

      The role of taxation is SUPPOSED to be about finance, but it really can’t be. If it were, you wouldn’t choose a structure where the compliance costs run 20% or more of the revenue collected, which is the case with personal and corporate income taxes. It’s a bit like saying you work to feed your family, but then you purposely choose a job that’s 100 miles away where commuting costs eat up a huge chunk of your salary.

      • LarryG says:

        re: ” It’s a bit like saying you work to feed your family, but then you purposely choose a job that’s 100 miles away where commuting costs eat up a huge chunk of your salary.”

        or even 50 or 25… same church.. different pew…

        i.e. “sprawl”.

        but I remind you .. people do this – a LOT….

        not only that… they want to drive SOLO at rush hour and wonder why the roads are maxed ….and their commute is hell…

        Most urbanized urban core in the US has this “problem”.

      • Methinks says:

        SeattleSam,

        My understanding is that compliance costs – that is, just the act of taxing money away from people – is more like 64% of revenue collected. that includes, I believe, the cost of preparation, professional assistance to prepare taxes, the IRS bureaucracy, enforcement to harass the tax slaves, prosecution and incarceration for accidentally or purposely cheating Caesar and the opportunity cost of time which could have been spent producing instead of prostrating before our masters.

        And all that is before the “redistribution” bureaucracies burn the vast majority (if not over 100%) of the $0.36 of every dollar that remains. The recipients in whose name the money is stolen and the economy is destroyed receive virtually nothing, but eagerly vote to keep doing it.

        • SeattleSam says:

          Even if you favored all this huge government spending, wouldn’t it make sense to be efficient about collecting the revenue? It’s like going to a Red Cross site to give blood and watching them spill half of it on the floor. They’d probably have to threaten people with fines and jail in order to make them come back to give more blood . . . .

          • Methinks says:

            Well, yes! That’s one reason Milton Friedman favoured the negative income tax. Mind, he didn’t think it was a good idea, he just thought that IF you’re going to have a welfare state, this is a cheaper way to run it. Cheaper on all levels.

            However, I doubt very much that collection costs would go down. People are naturally resistant to being robbed and the state must go to great lengths to wrench the fruits of people’s labour from them. This is true everywhere in the world. I don’t have any data to support this, but I think that if the tax rate is low enough people don’t bother resisting as it’s not worth their time. Thus, the cost of government theft would be lower.

  16. PeakTrader says:

    Dagbone says: “The role of taxation is FINANCE, as in, “How do we finance the functions of government that the majority of us find value in?””

    You can start by working 12 hours a day – six days a week to begin paying the $1 trillion annual federal deficits.

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