Something I don't understand that is sure to get me flamed

[tim]

So there's this idea that if we increase taxes on the rich, then rich people will stop working so hard (that the rich work hard is already questionable, but let's go with it) and, I don't know, stop producing all the social goods that rich people produce.

I mean, I think it would be great if just increasing taxes, by, say, 2% on household income above $500,000/year would make some of those high earners say, "Goshdarnit, it's not worth it for me to earn this much money if the government is just going to take it away. I better get a job teaching in an inner-city elementary school instead, brb." But somehow, I don't think that's going to happen.

Is it *really* that easy to stop people from being greedy? I'm not sure greed would deserve its deadly-sin status if it was that easy to eradicate.

And while I'm at it, what's up with accusations of "class warfare"? Rich people have been waging war on everyone else since, oh, whenever it was that some people started being rich. (In fact, that's how you get rich in the first place.) The rest of it is just class self-defense.

Comments

[etb]

Also, if we want to try to give each spouse some "share" of tax (and I'm not sure that actually makes any sense; the government* taxes them as a unit), why do it proportionally? After all, if the teacher were single, they'd be in a lower bracket and would pay disproportionately less tax. It's the $$$$-spouse who brought almost all the taxes down on them, so why not assign almost all the taxes to that person's income?

* If we're talking about the US. Canada allows spouses to trade income and deductions to some extent, but there's no such thing as filing jointly.

[anemone.livejournal.com]

I am talking about the US. Even in the US, this argument doesn't apply when we aren't talking married filers.

Most families with a $$$$-earner and a $-earner and two kids aren't going to consider the $$$$-earner becoming a stay-at-home parent and living off the $-earner's salary. That'd require a radical lifestyle change (moving out of the house, possibly to a different area of the country, their kids would be in a worse school district, etc).

What they are more likely to consider is whether the $-earner should work at all, so that's how I looked the issue. That is, I compared how much total money the married couple takes home when both $$$$-earner and $-earner work, vs how much total money the family takes in when $$$$-earner works and $-earner watches kids at home. How big that gap is will likely affect whether the $-earner makes the decision to work or not.

[anemone.livejournal.com]

The point is that Tim didn't ask a generic fairness question (in which case assigning the tax as I did would be silly), he asked specifically "how would changing the marginal tax rate on rich people change their behavior?"