Right on the Issues that Matter

Conservative Values Under Fire

Our Tax System in a Nutshell

Posted by sierrascrapper on October 17, 2008

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 on 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 beer 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 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!

NOW…take this anology and apply it to Obama’s Tax Plan.  You can just imagine.  According to Obama, “It’s GOOD to spread the wealth around.”  Honestly, if Obama is elected, I think we all should quit our jobs.  Why should we work?  I mean heck, let the “rich” man pay our bills.  It seems to me that no matter how hard I work, my bills keep coming and nobody else helps me.  So…why should I work harder?  Obama’s solution will do MORE HARM than good for ALL of us in America.

JUST SAY NO TO B.O.!!!!!

 

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