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[Montague]

Poor people buy things transported by trucks.  They buy fewer things however.  Rent and utilities account for a greater percentage of their income.  Rent and utilities are only weakly affected by oil prices.  Food also accounts for a greater percentage of their income and food prices are mostly independent of fuel since food price is highly determined by what people are willing to pay and less determined by fuel costs.

Poor people drive.  But they drive less.  When every mile counts you don't drive places you don't have to.

Poor people are also much more likely to take public transportation, to walk and to hitchhike.

Poor people are also very likely to be elderly.  Elderly people have a lot of ability to cut back on fuel consumption.

If you used a gas tax to finance a cut to payroll taxes, that would be a very, very good measure for the bottom 50%.  And the environment too.

How would payroll taxes help the unemployed, elderly, homeless or amish for that matter? What do the very poor care about payroll when their employers pay them under the table?

No dude, fuel subsidies help the lower and middle classes exceptionally and they greatly enhance economic growth because they allow the poorer citizens to do more with thier income. If gas is cost-prohibitive, then poor people stop driving cars, they are inable to go to work, they cannot afford rent, they cannot afford groceries and they are further alienated from society. That is why gas costs like 0.50$ in third-world countries, it's a plan to improve economic activity dispite everything else.

You are talking some sort of libertarian bizzaro world line of thought, getting rid of fuel subsidies. If you hate oil and gas and energy companies, that's fine. Think of a way of breaking their awful monopoly and their absurd profit margins.

 Increasing the expense of fuel is definately going to make the poor much poorer and the rich not-even-noticibly-less-rich.

[Realmfighter]

As much as I enjoy watching you both argue about this I think that citing something would probably be the better use of your time.

[mainiac]

Here's the thing Monty, that money comes from somewhere.  A payroll tax cut which helps the working poor or a sales tax cut that helps the elderly poor would help them more then a gas subsidy.  If you cut regressive taxes they can spend that money on anything.  If you increase the EIC they can spend that money on anything.  So if you cut the regressive taxes people can cut back on driving and come out ahead.  We as a nation win and poor people are better off.

Yes the gas tax isn't the most progressive tax around.  But if we want to help the poor there are much, much better routes to take:
-payroll tax cuts
-sales tax cuts
-unemployment insurance extension
-earned income tax credit
-child tax credit

So it would be very, very easy to come up with a policy that would both help the poor and raise the price of gasoline.  There are no shortage of progressive outlets that would love to give you those kinds of proposals.  The only thing stopping us is that republicans would never in a million years get on board.  It's not concern for the poor that stops anyone.

[Montague]

Here's the thing Monty, that money comes from somewhere.  A payroll tax cut which helps the working poor or a sales tax cut that helps the elderly poor would help them more then a gas subsidy.  If you cut regressive taxes they can spend that money on anything.  If you increase the EIC they can spend that money on anything.  So if you cut the regressive taxes people can cut back on driving and come out ahead.  We as a nation win and poor people are better off.

Yes the gas tax isn't the most progressive tax around.  But if we want to help the poor there are much, much better routes to take:
-payroll tax cuts
-sales tax cuts
-unemployment insurance extension
-earned income tax credit
-child tax credit

So it would be very, very easy to come up with a policy that would both help the poor and raise the price of gasoline.  There are no shortage of progressive outlets that would love to give you those kinds of proposals.  The only thing stopping us is that republicans would never in a million years get on board.  It's not concern for the poor that stops anyone.

Most tax revenue comes from rich assholes! They have the most income, they owe the most to society for their absurd income, they pay the most taxes, in this nation, at least.

We are talking about fuel subsidies, which really don't measure up to anything significant if considered against everything else in the federal budget. Right up there with corn subsidies (another measure that benefits the poor by lowering overall costs of food).

Certainly fuel subsidies are paid for by somebody, everybody that pays taxes, basically, but what is difficult to measure is the overall benefit that subsidy has the greater economy. It's argued subsidies on fuel stimuate economic growth and enable the non-wealthy to contribute more, by being enabled to afford to do more.

Those other taxes might be measured again on their own individual merit, but we are talking about fuel subsidies here.

It's sort of ironic, because the 'road tax' we have now, the marginal tax collected on gasoline sales is considered the fairest tax we have. People buying gas are driving on roads, and the road tax is designed to pay for road maintaince and improvement. The more gas you buy, the more you must use the roads and the more you pay, right?

I'd say energy is simply too fundamental to a modern society to be veiwed as such.

[mainiac]

Most tax revenue comes from rich assholes! They have the most income, they owe the most to society for their absurd income, they pay the most taxes, in this nation, at least.

Yes but the tax system is only slightly progressive.  They pay more but they don't pay a hugely larger portion.  So in terms of helping the poor there is a lot that you can do.

But that's just distracting from the main point.  If you wanted to offset the effects of a gas tax on the poor then you could very easily do it through half a dozen different avenues.

[Montague]

Most tax revenue comes from rich assholes! They have the most income, they owe the most to society for their absurd income, they pay the most taxes, in this nation, at least.

Yes but the tax system is only slightly progressive.  They pay more but they don't pay a hugely larger portion.  So in terms of helping the poor there is a lot that you can do.

But that's just distracting from the main point.  If you wanted to offset the effects of a gas tax on the poor then you could very easily do it through half a dozen different avenues.

Well ok, taxes could be more or less progressive but that's besides the point.

So, what would you hope to accomplish by eliminating fuel subsidies? You'd eliminate fuel subsidies and replace it with some more complicated scheme of reinbursement for the lower 95%? How would you really accomplish the same means through some other mechanism?

[mainiac]

Okay, suppose you did a gas tax hike and ended the subsidies that oil companies get.  Use that money for a payroll tax decrease and a social security payout bump.  Strong new incentive to reduce oil consumption, the effects on the poor are offset and you save money long term.

Not exactly byzantine in it's complexity.

[NinjaBoot]

Okay, suppose you did a gas tax hike and ended the subsidies that oil companies get.  Use that money for a payroll tax decrease and a social security payout bump.  Strong new incentive to reduce oil consumption, the effects on the poor are offset and you save money long term.

Not exactly byzantine in it's complexity.

Even if  the payroll tax was eliminated, it would not come close to covering the jump in gas and oil prices for the poor. 

Bumping an increase to social security only affects those who already paid into the system.  While it does cover those who have been unemployed, it only provides unemployment payments for so long. 

And also, due to COLA (cost of living adjustment), people who collect from Social Security in general get an increased payment to off-set the cost of living, so, if the price of heating your home and powering it increase, so to does the payments automatically. 

The only way this will affect the poor is by making it harder for them to actually buy anything or even to stay in their current residency.  Why?  Well, since poor people generally work low-paying jobs, the money gained from the decrease/elimination of a payroll tax is fairly miniscule. 

[Reelya]

Just so i got it clear, you are advocating tax and spend policies in regards to gas prices?

Obviously the amount spent must equal the additional amount taxed, and more is going to the poor than they get taxed, so you're cool with taxing more well-off people to pay for this?

[NinjaBoot]

Just so i got it clear, you are advocating tax and spend policies in regards to gas prices?

Obviously the amount spent must equal the additional amount taxed, and more is going to the poor than they get taxed, so you're cool with taxing more well-off people to pay for this?

Taking in less tax from a company so they can set up shop and produce a good (or service) does not equal spending direct taxpayer money to make it happen (indirect vs direct subsidies). 

The benefit of doing this with oil and gas companies mean they can offer their goods and services at a cheaper rate.  The more money they make, the more money is taxed.   

As for taxation..

http://en.wikipedia.org/wiki/Income_tax_in_the_United_States

"In the United States, a progressive tax system is employed which equates to higher income earners paying a larger percentage of their income in taxes. According to the IRS, the top 1% of income earners for 2008 paid 38% of income tax revenue, while earning 20% of the income reported.[44] The top 5% of income earners paid 59% of the total income tax revenue, while earning 35% of the income reported.[44] The top 10% paid 70%, earning 46% and the top 25% paid 86%, earning 67%. The top 50% paid 97%, earning 87% and leaving the bottom 50% paying 3% of the taxes collected and earning 13% of the income reported.[44]"

[mainiac]

Federal taxes are not all of taxes.  Federal taxes are progressive.  State and local taxes are regressive.  Net effect is a system that is only slightly progressive overall.

Geez man, it's like you aren't even trying.

[GlyphGryph]

You want a totally rage worthy issue regarding economics in America? I present you with:

http://www.washingtonpost.com/foreclosure-settlement-a-failure-of-law-a-triumph-for-bank-attorneys/2012/02/23/gIQAe7feaR_story.html

The amazing economics of criminality.

[NinjaBoot]

Federal taxes are not all of taxes.  Federal taxes are progressive.  State and local taxes are regressive.  Net effect is a system that is only slightly progressive overall.

Geez man, it's like you aren't even trying.

State and local taxes are different for all 57 states!  So, uh.. you are going to have to provide some examples here of state and local taxes being regressive! 

[mainiac]

Um, no, the average is what I'm talking about so I really don't see how specific examples illuminate that.

And why give you information that you will just reject out of hand anyway?

[NinjaBoot]

You want a totally rage worthy issue regarding economics in America? I present you with:

http://www.washingtonpost.com/foreclosure-settlement-a-failure-of-law-a-triumph-for-bank-attorneys/2012/02/23/gIQAe7feaR_story.html

The amazing economics of criminality.

What is more amazing is that the government was implicit all along in this whole charade. 

They were the ones who passed the law that forced banks and lending institutions to lower their lending standards to, *ahem*, get more minorities/non-whites into homes. 

Or just read up on how the housing bubble exploded here in the United States.