Beer & Taxes
 

EXPLAINING OUR UNITED STATES TAXING SYSTEM WITH BEER

Suppose that every day, ten men go out for beer and the bill for all ten
comes to $100.

If they paid their bill the way we pay our taxes, it would go something like
this:

The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.

So, that's what they decided to do.

The ten men drank in the bar every day and seemed quite happy with the
arrangement, until one day, the owner threw them a curve. 'Since you are all
such good customers,' he said, 'I'm going to reduce the cost of your daily
beers by $20. Drinks for the ten now cost just $80.'

The group still wanted to pay their bill the way we pay our taxes so the
first four men were unaffected.

They would still drink for free. But what about the other six men - the
paying customers? How could they divide the $20 windfall so that everyone
would get his 'fair share?' They realized that $20 divided by six is $3.33.
But if they subtracted that from everybody's share, then the fifth man and
the sixth man would each end up being paid to drink his beer.

So, the bar owner suggested that it would be fair to reduce each man's bill
by roughly the same amount, and he proceeded to work out the amounts each
should pay.

And so:

The fifth man, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33%savings).
The seventh now pay $5 instead of $7 (28%savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before and the first four continued to
drink for free, but once outside the restaurant, the men began to compare
their savings. 'I only got a dollar out of the $20,' declared the sixth man.
He pointed to the tenth man, 'but he got $10!' 'Yeah, that's right,'
exclaimed the fifth man. 'I only saved a dollar, too. It's unfair that he
got TEN times more than I!'

'That's true!!' shouted the seventh man. 'Why should he get $10 back when I
got only two? The wealthy get all the breaks!'

'Wait a minute,' yelled the first four men in unison 'We didn't get anything
at all. The system exploits the poor!'

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for drinks, so the nine sat down
and had beers without him. But when it came time to pay the bill, they
discovered something very important....they didn't have enough money between
all of them for even half of the bill!

And that, boys and girls, journalists and college professors, is how our tax
system works.

The people who pay the highest taxes get the most benefit from a tax
reduction. Tax them too much, attack them for being wealthy, and they just
may not show up anymore. In fact, they might start drinking overseas where
the atmosphere is somewhat friendlier.

David R. Kamerschen, Ph.D.
Professor of Economics


University of Georgia

For those who understand, no explanation is needed.
For those who do not understand, no explanation is possible!

crap.......

there is way too much truth in that explination. I am going to have to use that one

how 'bout this...

your child is in college and has worked very hard to maintain a 4.0 GPA.

another student has not worked so hard, partying and such, getting by with a 2.0.

so, in the name of fairness, redistribution of wealth, socialism, or whatever term is preferred...

a point is taken from your child and given to the other. so everyone has a 3.0; and everyone is thrilled correct? :eek:

You guys, it's PATRIOTIC to pay more taxes. That means it's UN-Patriotic to complain about paying more taxes. It must be true...Joe Biden says so.

In context: https://news.yahoo.com/s/ap/20080918/.../biden_taxes_3
This guy could take some marketing/gimmick/smoke-and-mirrors lessons from Bill Clinton, who could have said it in bullschittese so that most people wouldn't know what it means...being a straight-talker is good when you're saying what people want or need to hear, but not so good when you're trying to get votes. Those "wealthier Americans" have a lot of political influence and can pay for lots of ads...

The Robin Hood strategy isn't so popular among those with some money.

Middle class people that will receive gov't help = "Not you."

im sorry you lost me at beer....:D

Promote the general welfare y'all :)

I can see tax incentives for American employers, that promote employment in America, but I'm not gonna cry about a 30% tax on $2,500,000 earners.

The 2.5 mil earners will just move to a place where their experience, drive, and wealth are appreciated for the potential for improving the overall economic health of the general population.

Its a world market and you better believe hanging a bigger tax anchor on those who have succeeded will drive them elsewhere.

Tax the rich feed the poor, til there are no rich no more.

They will be gone.

regards
gary

Man, I must be really bored. I keep posting in these political threads. Anyway...

Question for people on both sides: If you don't tax away an extra 30% from the folks who make a lot of money, what are they going to do with that money instead? Where is that money going to go?

It is typically invested in productive things. Like companies that create jobs or their own companies. What do you think would happen to the stock market if people suddenly had 30% less to invest?

I wouldn't bring up that whiney beotch called the stock market. Talk about a sense of entitlement. It drives policy, worse than a union.

True, it does. And I was in no way in favor of that bailout, if people make mistakes they should fail, even if it brought the whole economy to a stand still. Propping the economy up on worthless paper is only going to prolong the inevitable anyway. At least in my opinion.

To be truly accurate, (considering that the lowest income brackets get tax credits even thought they don't pay any taxes) at the beginning wouldn't the first two get $1 back, and the last 2 have to pay $1 more to cover it?

I'm just sayin'...

All this is too much for me...I need a beer!

The trouble is also, some 'companies' are just DBAs, granted very rare and very small ones, but it's conceivable to hurt business by taxing private individuals who make a lot.

Also what's a better alternative? The only comparison I have is Germany and everyone gets taxed 55-65%. Of course I think a lot don't have to work and everyone gets 'free' health care. Take a look over there to see what would happen here if democrats had their way....