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Re: Our tax ssytem



And in the case of Enron, the first 4 guys don't get any food at all but
still get stuck with the entire bill....  :(

Jill L Schneider
USGS - Alaska Technical Data Unit
907-786-7457
jschnidr@usgs.gov
http://alaskaminerals.wr.usgs.gov



                    Nicholas Gilliam
                    <nbgilliam@YAHOO.COM        To:     ARCHIVES@LISTSERV.MUOHIO.EDU
                    >                           cc:
                    Sent by: Archives &         Subject:     Our tax ssytem
                    Archivists
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                    05/31/2002 07:35 AM
                    Please respond to
                    Nicholas Gilliam





OUR PERSONAL TAX SYSTEM AND HOW IT WORKS<?XML:NAMESPACE PREFIX = O />





Best explanation given yet........





I was having lunch with one of my favorite clients last week and the
conversation turned to the government's recent round of tax cuts.





"I'm opposed to those tax cuts," the retired college instructor declared,
"because they benefit the rich. The rich get much more money back than
ordinary taxpayers like you and me and that's not fair."





"But the rich pay more in the first place," I argued, "so it stands to
reason that they'd get more money back." I could tell that my friend was
unimpressed by this meager argument.





Even college instructors are a prisoner of the myth that the "rich" somehow
get a free ride in <?XML:NAMESPACE PREFIX = ST1 />America . Nothing could
be further from the   truth.





Let's put tax cuts in terms everyone can understand .





Suppose that every day 10 men go to a restaurant for dinner. The bill for
all ten comes to  $100. If it was paid the way we pay our taxes, the first
four men would pay nothing; the fifth would pay $1; the sixth would pay $3;
the seventh $7; the eighth $12; the ninth $18. The tenth man (the richest)
would pay $59.





The 10 men ate dinner in the restaurant every day and seemed quite happy
with the arrangement until 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
meal by $20. Now dinner for the 10 only costs $80." The first four are
unaffected. They still eat for free. Can you figure out how to divvy up the
$20 savings among the remaining six so that everyone gets his fair share?
The men realize that $20 divided by 6 is $3.33, but if they subtract that
from everybody's share, then the fifth man and the sixth man would end up
being paid to eat their meal.





The restaurant 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 now the fifth man paid nothing, the sixth pitched
in $2, the seventh paid $5, the eighth paid $9, the ninth paid $12, leaving
the tenth man with a bill of $52 instead of $59.





Outside the restaurant, the men began to compare their savings. "I only got
a dollar out the $20," complained the sixth man, pointing to the tenth,
"and he got $7!" "Yeah, that's right," exclaimed the fifth man.





"I only saved a dollar, too. It's unfair that he got seven times more than
me!" "That's true," shouted the seventh man. "Why should he get $7 back
when I got only $2? 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 he didn't show up for dinner, so the
nine sat down and ate without him. But when it came time to pay the bill,
they discovered something important.





They were $52 short!  And that, boys, girls and college instructors, is how
America 's 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 at the table any more. There are
lots of good restaurants in Switzerland and the Caribbean !





(Author not named)



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