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Thread: You’re Better Off in a State With a Higher Income Tax

  1. #31
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    Quote Originally Posted by publius3 View Post
    As a whole, the EU is really not doing well. It is currently mired in what we were calling the "Great Recession"
    Again, you speak in purely economic terms.
    Enclaves in the sense of regions, which are not walled.
    Now you confuse me even more. What are you talking about?

    Seasonal affective disorder is a disorder, but generally nasty weather starts to grate on people. And yes, this is a real economic impediment for the Rust/Snow Belt right now.
    People in California or Florida do not report higher levels of happiness than people in Ohio or Pennsylvania. Having grown up in PA but spent my entire adult life after my undergrad and graduate education in warmer places, it doesn't make sense to me either, but that's what the research shows, from what I read.

    So median in NJ is 60k now +/-, something like that. So beyond $72,000 for a family of four, people wouldn't be happier? I think the brightline you're noting here is probably too low, but I'm not really discussing that, and no I'm not 'arguing' here actually, whether its 72k or 80k or 200k or 350k....that's beside the point because....

    .....the basic point is true, at some point making more money doesn't make you happier in one sense, in the sense that the ability to consume more will make you any happier.
    That is the point. My understanding is that there's a serious flattening of the curve after about $75K (obviously compared to the nation as a whole, not NJ). Each dollar after that doesn't make you all that much happier. I suspect $1 makes no difference at all to Bill Gates. $1000 probably means nothing to him.

    But that's not why it makes you happy. It makes you happy because you can make your wildest dreams come true and those dreams aren't mindless self aggrandizement.
    Research shows that the best thing you can do with your money, in terms of making yourself happy, is to given it away. I don't think there's a ethical system or philosophy of much import that doesn't see acquisitiveness as a serious moral lapse. It doesn't make us better people and it doesn't make us happy.
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  2. #32
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    Quote Originally Posted by Rasselas View Post
    I love how you come into threads and just start making pronouncement.

    Hi Tennyson.
    Hi, Rasselas.

    I am just putting in my two-cent's worth, which is generally worth less than a penny.

    A high marginal tax rate does not equate to a positive impact on the economy. During the 1940s and 1950s, when the average marginal tax rate was in the 90+ percent range, the effective tax rate was in the thirty percent range. Moreover, the individual tax revenue as a percentage of GDP during FDR, Truman, and Eisenhower’s 90+ percent top marginal tax rate was 5.3% of GDP. The first time that the individual tax revenue made a significant increase as a percentage of GDP was when Reagan cut the tax rates. When Regan cut the tax rates, the individual tax revenue as a percentage of GDP jumped from 5.3% of GDP to 9%, and averaged 8% under Reagan's two terms. Under Bush’s tax rate cuts, it averaged 7.7% with two recessions. Historically the individual tax revenue as a percentage of GDP of the 90+ percent income tax rate has always been significantly lower than the tax revenue under the lower tax rates of Bush and Reagan.

  3. #33
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    Quote Originally Posted by Rasselas View Post
    Again, you speak in purely economic terms.
    Now you confuse me even more. What are you talking about?

    People in California or Florida do not report higher levels of happiness than people in Ohio or Pennsylvania. Having grown up in PA but spent my entire adult life after my undergrad and graduate education in warmer places, it doesn't make sense to me either, but that's what the research shows, from what I read.

    That is the point. My understanding is that there's a serious flattening of the curve after about $75K (obviously compared to the nation as a whole, not NJ). Each dollar after that doesn't make you all that much happier. I suspect $1 makes no difference at all to Bill Gates. $1000 probably means nothing to him.

    Research shows that the best thing you can do with your money, in terms of making yourself happy, is to given it away. I don't think there's a ethical system or philosophy of much import that doesn't see acquisitiveness as a serious moral lapse. It doesn't make us better people and it doesn't make us happy.
    I just think they're conflating material contentment and self actualization. If you make 100k and you double to 200k but are stuck going to the same boring job, then they are making a decent point. But if you have $5m and can make $200k off of that and you get to do whatever you want, whenever you want to do it. And the things you choose to do like [insert your dreams] become self actualizing and fulfilling. The poster child for this would be Elon Musk. People have their dreams, some dreams are going to require alot more than 75k per year will permit.
    Last edited by publius3; 29th October 2017 at 05:58 AM.

  4. #34
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    Quote Originally Posted by publius3 View Post
    I just think they're conflating material contentment and self actualization. If you make 100k and you double to 200k but are stuck going to the same boring job, then they are making a decent point. But if you have $5m and can make $200k off of that and you get to do whatever you want, whenever you want to do it. And the things you choose to do like [insert your dreams] become self actualizing and fulfilling. The poster child for this would be Elon Musk. People have their dreams, some dreams are going to require alot more than 75k per year will permit.
    No, it's more like measuring marginal utility. One can become self-actualized regardless of money, after a certain point--it's certainly below $5 million. When you make $5 million/year, one has a hard time figuring out what to do with it. There's only so much house you can buy. Only so much car. And your friends making $75K aren't your friends anymore--you have new friends, some of whom make $10 million; you want to be like them and feel inadequate because you don't make as much money, just like people making $75K want too be like the people they know making $150K. At some point, the utility of the money becomes unimportant--the numbers are what matters. At that point, we might as well have very high tax rates, since earning the money, not spending it, is the point.

    If you want to be self-actualized, go volunteer somewhere. You can do that on a relatively more modest income.

    The central point about money and happiness is clear--poverty makes people miserable, but wealth doesn't make them happy.

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    Quote Originally Posted by Rasselas View Post
    No, it's more like measuring marginal utility.
    For consumption, like I pointed out.

    Quote Originally Posted by Rasselas View Post
    One can become self-actualized regardless of money
    Depending on one's dreams.

    Quote Originally Posted by Rasselas View Post
    after a certain point--it's certainly below $5 million.
    Actually my reference to $5mn there was that a person would have $5mn in assets and those assets would produce a work-free income of $200k per year.

    Quote Originally Posted by Rasselas View Post
    When you make $5 million/year, one has a hard time figuring out what to do with it.
    That's presumptuous.

    Quote Originally Posted by Rasselas View Post
    There's only so much house you can buy. Only so much car.
    Indeed, that's the only good point about it. Jeter is buying the Marlins and he's been trying for some time now to buy the Marlins. Alone, no matter how much he made playing for the Yankees, he didn't have the money. Now, that's his pursuit of happiness. So be it. That one happens to be a relatively large dream. Elon Musk's dreams are flat out grandiose in scale.

    Quote Originally Posted by Rasselas View Post
    At some point, the utility of the money becomes unimportant--the numbers are what matters.
    Its the attainment of goals. And 75k per year surely wouldn't even be close.

    Quote Originally Posted by Rasselas View Post
    The central point about money and happiness is clear--poverty makes people miserable, but wealth doesn't make them happy.
    I'm going to start a Planet Fitness, then an Outback Steakhouse and beyond that I want to start a car dealership.

    These are much, much smaller dreams than Elon Musk's of course but still dreams that require incomes much greater than 75k per year, that's for damn sure.

    And yes, its the achievement that drives me to lead a purpose driven life, the expression of my pursuit of happiness.

    "America is too great for small dreams." -- Reagan

    (which is not to say I begrudge small dreams either)
    Last edited by publius3; 29th October 2017 at 08:35 AM.

  6. #36
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    Quote Originally Posted by publius3 View Post
    For consumption, like I pointed out.



    Depending on one's dreams.



    Actually my reference to $5mn there was that a person would have $5mn in assets and those assets would produce a work-free income of $200k per year.



    That's presumptuous.



    Indeed, that's the only good point about it. Jeter is buying the Marlins and he's been trying for some time now to buy the Marlins. Alone, no matter how much he made playing for the Yankees, he didn't have the money. Now, that's his pursuit of happiness. So be it. That one happens to be a relatively large dream. Elon Musk's dreams are flat out grandiose in scale.



    Its the attainment of goals. And 75k per year surely wouldn't even be close.



    I'm going to start a Planet Fitness, then an Outback Steakhouse and beyond that I want to start a car dealership.

    These are much, much smaller dreams than Elon Musk's of course but still dreams that require incomes much greater than 75k per year, that's for damn sure.

    And yes, its the achievement that drives me to lead a purpose driven life, the expression of my pursuit of happiness.

    "America is too great for small dreams." -- Reagan

    (which is not to say I begrudge small dreams either)
    Dreams are incredibly malleable. I think most of what you've said here is crap.

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    Quote Originally Posted by Rasselas View Post
    Dreams are incredibly malleable. I think most of what you've said here is crap.
    Trust me, I hate your fucking guts.

  8. #38
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    Quote Originally Posted by publius3 View Post
    Trust me, I hate your fucking guts.
    That's nice. I just think setting up Derek Jeter as a test case is nonsense. I can't think of someone more atypical. And you don't even really know what Derek Jeter's heart's desire is, or how he developed it, if you don't know him. What I've said is based on research interviews of thousands of people, often repeated. Do you practice law this way? Find one exception and that blows away any argument someone else can make?

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    DJ is atypical, the tens of millions of people who need 500k, 750k, 1m+ in liquid assets who clearly can't attain their dreams making 75k are not an exception, but I digress, because that obviously wasn't a segue to further argumentation now, was it?

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    The topic suggests at a minimum a couple of questions. (1) How 'should' states and municipalities tax (given they have to balance their budgets on average), and (2) how much does the way states tax explain their economic growth or lack thereof?

    States have to tax some combination of consumption, property, income and/or industry. There are downsides to taxing each of those things to fund government. The downsides are probably more pronounced for some than others depending on the multitude of other variables, and similarly, the economic outcomes of some states relative to others are also going to depend significantly on those other variables.

    When you examine something by applying partisan spin, you reach a conveniently partisan conclusion.

    State governments have to tax, and they have to tax because they have to provide for health, education, infrastructure, and other services. State governments have service requirements. They have to do things. And to do things takes money, and they can't create their own money. So they must tax.

    What this means is that the ideologically anti-tax crowd is asking its state government to pull one over on them. They're saying to their government, hide the cost of government from me, I don't want to have awareness of how you're screwing me. The state government has to tax and it will tax one way or another. If the state's taxpayers fiercely oppose, say, an income tax to provide needed revenue, they'll pay for it in some other way. Through crumbling infrastructure, pitiful support to political subdivisions (municipalities), non-competitive education, taxes on consumption or property or industry, or something else. There are service responsibilities that must be funded and will be funded. The voters rallying around an anti-tax candidate or proposition will not prevent the state paying for these services and responsibilities.

    I can and do share in the anti-tax sentiment, but I see what happens when a government has to fund things and the voters agree those things need to be funded by refuse to provide the funds. The funds get squeezed out of something else. There's no choice.
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