# Want to know where all the money is?



## sags (May 15, 2010)

Trillions and trillions of dollars floating around.............and few people seem to have much of it.

Want to know where it is..........check out this well done video for an eye opener.

http://www.youtube.com/watch?v=QPKKQnijnsM&feature=youtu.be


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## dubmac (Jan 9, 2011)

A very good, and brief explanation to a problem that most Amercians are probably aware of, but don't want to hear.
I plan to share this with a few people here at work (I'm a teacher) - thanks for this sags.


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## pwm (Jan 19, 2012)

This video did not mention what portion of income and other taxes are paid to the government by the various groups. Large numbers of people in Canada and the USA pay no income tax at all and yet reap the benefits which are paid for by the wealthy, and at the same time hate them for having more than they do.


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## Nemo2 (Mar 1, 2012)

pwm said:


> This video did not mention what portion of income and other taxes are paid to the government by the various groups. Large numbers of people in Canada and the USA pay no income tax at all and yet reap the benefits which are paid for by the wealthy, and at the same time hate them for having more than they do.


+1


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## Eder (Feb 16, 2011)

People don't have much of the wealth because they blow their money on frappe's and iPhone contracts and without any clue as to how to save a few k and start becoming wealthy. The easy road. Too bad many people complain rather than try to emulate those that succeeded.


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## carverman (Nov 8, 2010)

Hmm..let me guess?
Credit card companies, cell phone companies...Microsoft and Bill Gates for starters.


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## Toronto.gal (Jan 8, 2010)

Of course it's easier to complain, and spend even what you don't have.

The video conveniently left out the tax payments indeed.


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## Just a Guy (Mar 27, 2012)

I stole this from my favorite site, but I'm sure he copied it as well...


An oversimplification, but also a classic…
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 beer by $20.” Drinks for the ten now cost just $80 total.
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.
For those who understand, no explanation is needed. For those who do not understand, no explanation is possible.


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## dubmac (Jan 9, 2011)

^ brilliant!


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## sags (May 15, 2010)

The wealthy claim more in tax deductions than most people earn in a year..........or maybe two or three, and the rest of us get to make up the difference in lost revenue.

Maybe they could send out a card at Christmas............"thanks for subsidizing the tax deduction on my 5 Million dollar mortgage...........signed, rich dude"......

If the wealthy are paying so much in taxes.........why do they fight so hard to keep it a secret?

Mitt Romney wasn't exactly forthcoming on his tax rate.

It is embarassing for them to admit how little they actually do pay.

Warren Buffet said he paid a lower tax rate than his secretary.........as do many others.


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## Nemo2 (Mar 1, 2012)

A lower tax _rate_ might, but does not necessarily, equate to lower tax paid:

http://www.forbes.com/sites/paulrod...y-likely-makes-between-200000-and-500000year/



> Insofar as *Buffett (like Mitt Romney) earns income primarily from capital gains, which are taxed at 15 percent* (and according to Obama need to be raised for reasons of fairness), we need to determine how much income a taxpayer like Bosanek must earn in order to pay her tax rate. This is easy to do within ranges.
> 
> *Buffet himself declares that he pays a 17.4 percent rate on taxable income. His staff, like Bosanek, pay an average of 34 percent. *The IRS publishes detailed tax tables by income level. The 2009 results show that the average taxpayer paying Buffet’s 17.4 rate earns an adjusted gross income between $100,000 and $200,000. But an average taxpayer in Bosaneck’s rate (after downward adjustment for payroll taxes) earns an adjusted gross income of $200,000 to $500,000. Therefore Buffett must pay Debbie Bosanke a salary well above two hundred thousand.


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## Just a Guy (Mar 27, 2012)

As a business owner, or even an investor it is true I can pay less taxes. 

That being said, it doesn't mean I get to keep more money, but it does benefit others. 

For example, I can deduct my accounting expenses, so instead of giving thousands of dollars to the government, I pay the salary and overhead of an accounting firm that same money. It doesn't go into my pocket. 

The same thing with the contractor I hire to fix the place giving a home to someone who can't or chooses not to buy a house. 

Tax deductions are ways to employ people and stimulate the economy. It's easy to say the wealthy don't pay their fair share, especially when you don't understand the system. How many homes and jobs are supplied by the low end earners?


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## Dmoney (Apr 28, 2011)

sags said:


> The wealthy claim more in tax deductions than most people earn in a year..........or maybe two or three, and the rest of us get to make up the difference in lost revenue.
> 
> If the wealthy are paying so much in taxes.........why do they fight so hard to keep it a secret?
> 
> ...


The wealthy may deduct more, but in the example (and in reality) pay more than 50% of all taxes (top 10%). The rest aren't making anything up... the rich are making up for the shortfall of the other 99%, 90%, 50%... however you slice it. 

Buffett's *personal* tax *rate* is low because he earns income through dividends and capital gains. This has already been taxed at the corporate level. If you want to see him pay more tax, implement a 0% corporate tax rate and tax all income equally (ignoring the punitive impact of inflation on capital gains).

Both sides of this debate twist statistics into whichever form backs up their ideology, and no side is going to convince the other of the merit of their views. One thing is absolutely certain though: the rich pay more taxes than the poor on an absolute basis... 15% of $10 million is significantly more than 100% of $45,000. The rich pay their way, and the way of many others, and this is as it should be, since society at large provides the rich with their riches.

But as in the beer drinking example, the hate-on for the rich needs to end, and instead of trying to drag the rich down, we should be trying to help the poor up.


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## carverman (Nov 8, 2010)

Just a Guy said:


> It's easy to say the wealthy don't pay their fair share, especially when you don't understand the system.
> 
> How many homes and jobs are supplied by the low end earners?


The poor can't afford to pay taxes on social assistance, which is tax free. The poor do not create jobs. The poor cannot afford houses or pay property tax.
The poor cannot stimulte the economy with goods, services and employment.
The poor live in social assistance housing provided by the rich landlords, who are in business to provide shelter to everyone, including the poor.

But the poor also don't pay any taxes.


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## sags (May 15, 2010)

As the video illustrates........the poor remain poor.

The growth for the elite wealthy is taken from the shrinking middle class.

As their ownership of all wealth increases, so will the need for some form of wealth transfer.


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## jcgd (Oct 30, 2011)

I don't get it. I would be more specific, but I don't get any of it. I'm curious what percentage of the poor are poor for reasons outside their control vs reasons they do control.

What percentage of the poor are disabled?
Mentally ill?
Unable to find ANY job?
Lazy?
Had too many kids?
Burned all their bridges?
Couldn't go to school?
Wouldn't go to school?

My point is, I have or will pay more than my share of government services in my lifetime, almost certainly if you break it down into equal chunks person by person. I will earn more than I spend and slowly but surely I will become rich, at least compared to the poor. Even though I will have paid more than my equal share of everything I will be able to move from middle class to upper class through saving and investing. Some of the money I pay into the system will make it's way into the pockets of the poor (albeit temporarily). So if I am able to become the rich, how am I a net taker of money from the poor, and why should there be a transfer of my wealth back to the guy who has already received some of my wealth. Is the reason simply because I have some and he doesn't?


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## carverman (Nov 8, 2010)

jcgd said:


> I don't get it. I would be more specific, but I don't get any of it. I'm curious what percentage of the poor are poor for reasons outside their control vs reasons they do control.
> 
> What percentage of the poor are disabled?
> Lots of them.
> ...


You are through careful management of your life and assets are better off than most of the poor. You certainly don't owe anything to the poor. That is their fate or bad luck
through anyone of the reasons stated above. Someone has to help them though..and the government through your taxes on income and assets helps them to stay alive..
because they can't break the vicious cycle of being poor.


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## jcgd (Oct 30, 2011)

I should add, I'm not against helping anyone, I'm just being Devil's advocate.

What is the vicious cycle of being poor? If you are honestly unable to provide for yourself, you are to a degree helped out. If you are bringing it upon yourself, what is stopping you from improving your life? If you are poor would not everything be upside? Worst thing that happens if you try to succeed and fail is you fall back to where you started. I think the real issue is the policies that create the viscious cycle.

Say a single mom is getting government support. She tries to save a little extra so she can go to school to better her and her children's lives. She finally saves up $400 in her bank account and the government cuts her support. She now needs to use that $400 to survive while without the support, and then the support kicks in. 

Stop craziness like that and maybe people could help themselves. I don't see why someone should have their accumulated wealth transferred to someone else, through taxing or any other means. I don't even understand that progressive tax system to be honest. I understand paying my share, but I don't understand paying a larger (percentage) just because I make more money.


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## sags (May 15, 2010)

It isn't quite true that "our" individual income taxes fund the social programs for the poor either.

The government raises revenues from all kinds of sources.

One could also claim social programs are paid from lottery taxes.........or liquor taxes.........or cigarette taxes.........or any other taxes or fees collected.


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## sags (May 15, 2010)

People without kids subsidize people with kids. People without kids subsidize the education system. Healthy people subsidize health care.

That is what happens in society............people put the money into a pot and the government funds the services we demand.

And demand we do......

As in how "complaints" reach the media about how long an ambulance or police took to respond to a situation, or how a sick person wasn't immediately attended to at the hospital, or how our kids aren't getting a good enough education...........

We want the services.........but complain about the cost.


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## jcgd (Oct 30, 2011)

I get how the system works overall, and I understand the issues involved, but what I don't understand is the solution. We can literally take all the money, redistribute it, and wait for everything to go back to the way things are now. 

I think you have to pick a system. You can't have both. Either you tax to the hilt and have big government with lots of support, or you have a small government and let the people decide what to do with the money. The issue I see today is the issue of some people not being able to use the capital system.

Any progress must be feasible. If you are caught in a vicious circle of staying poor, then you are saying there is a situation from which there is no legal way out. Obviously if the government is going to support these people, they will have to support them forever assuming it is not economically possible for the person to dig themselves out of the hole. The government needs to change the policies they have created that prevent people from breaking away from the vicious circle.


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## Just a Guy (Mar 27, 2012)

Perhaps we need to change the way people think. I know a guy who was doing quite well, then ran into health problems became dirt poor. As he was starting to get sick, he started to teach himself about investing, something his family never talked about. It didn't stop his slide, as investing took years to bear fruit, and he went into debt instead of selling his investments. Today he's considered wealthy, has passive income and is not working. Health still isn't good. 

We need to teach people how to make money, the taboo subject. Though I suspect the number of people who know how to make money other than a paycheque may be very small relatively speaking. 

Give a man a fish and you feed him for a day (and he'll want another one tomorrow). Teach a man to fish and he can feed himself forever. That being said it's easier to complain until someone feeds you than it is to learn to fish.


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## Just a Guy (Mar 27, 2012)

Another thing to consider is the vicious cycle that comes from "wants". Governments collect taxes to fund government employees (including healthcare and education). Inflation/cost of living eats away at earning power, employees want a raise usually above inflation. Government has to raise more money to pay for the raises, creating higher cost of living meaning employees want a raise...

We could also talk about mass communication's impact. For example I hear Alberta's teachers are the highest paid in Canada, but the cost of living in Vancouver and Ontario is much higher in some areas. What do you bet the unions bring that up in the next round of bargaining? Raising the cost of education in two more provinces. 

Of course this is an oversimplification, but it must contribute to the problem...and don't get me started on the costs of government projects (waste).


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## sags (May 15, 2010)

TVO had some shows where the probability of attaining "the American Dream" or being able to "do whatever you desire in life" were closely examined by researchers.

The conclusion was that the odds of people pulling themselves up into attaining the American Dream were very, very small.

The people who have managed to do it.........have bucked overwhelming odds.

Governments have never truly addressed the root problems of poverty. 

Why.........for example..........would we want to discourage a single mom from going to school to obtain training so she can go forward in her life, by taking away her social assistance payments and health benefits for her kids, and telling her to apply for student loans?

Why do we not allow those on EI from getting any training while on EI? They are supposed to "looking for work" only.

Why are huge corporations allowed to pay employees minimum wages on part time jobs with no benefits...........while they sit on billions of dollars in profits and spent hundreds of millions more on bonuses for upper management?

We pay people to do nothing..........penalize them if they try to do something.......and whine about their lack of effort.

What is the cost to incarcerate a young person, rather than providing an alternative for them? Some very successful programs have been eliminated for lack of funding.

To fix the system would require creativity and work, something our politicians severely lack.

They want to show up whenever they feel like it, vote the party line, munch away at the buffet, spend the expense account, and not worry about anything.

It is like.......once elected they have reached the summit of the mountain..........and now just want to lay down and enjoy the view.


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## Just a Guy (Mar 27, 2012)

You know, of course, that people abuse the system at both ends of the scale right? I work with a lot of volunteer organizations that try to help the poor. The abuse that I've seen there is equal to government and the wealthy. Actually, that's not true, I don't know as many wealthy who actually abuse the system...but they are almost always the poster boys for it.


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## carverman (Nov 8, 2010)

sags said:


> T
> 
> Why.........for example..........would we want to discourage a single mom from going to school to obtain training so she can go forward in her life, by taking away her social assistance payments and health benefits for her kids, and telling her to apply for student loans?


I dunno?..maybe so the single mom can got out and find a job that pays just a bit above minimum wage as an hourly worker,with no benefits, and have to pay babysitting or daycare out of her own pocket as well as any student loans she has to pay back. 
Frying pan or fire..it's your choice..single mom,


> Why do we not allow those on EI from getting any training while on EI? They are supposed to "looking for work" only.


Gov'ts tried that in past years (Manpower retraining)..most of the time the people on EI went because they were forced to "retrain" in other lines of work, that were either not suitable for their lifestyle or just too far away to travel/relocate...so this also encourage fraud on collecting EI.. 
ie: the gov't trained me to be a brain surgeon..but the hospitals because of budget cuts, don't require any more brain surgeons. :biggrin:




> To fix the system would require creativity and work, something our politicians severely lack.


 Most of the problems facing the system are social issues compounded with lack of good paying jobs that promote incentive to work. 
Our Politicians have no clue how to address that,other than the gov't advertising on TV about the "economic action"plan..that for most on EI is nice to hear about but doesn't solve their own individual situation.


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## sags (May 15, 2010)

Is there a "Laffer curve" for when accumulation of the total wealth reaches the point of diminished returns for society as a whole?

Maybe we have reached that point already......and the economy will only decline from here.


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## pwm (Jan 19, 2012)

Want to know who pays all the taxes? This is from the Financial Post today:

"This progressivity can help us understand why the top 1% of income earners paid a staggering 21.2% of the total federal and provincial taxes in 2010. The top 10% paid 54.8% of all taxes while the bottom 50% of Canadian income earners contributed 4% towards the collective personal tax bill."


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## hystat (Jun 18, 2010)

sags said:


> Why.........for example..........would we want to discourage a single mom from going to school to obtain training so she can go forward in her life, by taking away her social assistance payments and health benefits for her kids, and telling her to apply for student loans?


um... because I didn't get her pregnant?
The "teach a man to fish" philosophy that comes up in these discussions should also include "teach a man to make good decisions".

The broken home or deadbeat dad is still looked at like some sort of terrible car accident that "just happened". Well it didn't. People coupling up under the guise of a marriage meaning stability is built on a shaky foundation of a morally empty society. And if daddy is a deadbeat.... he was a loser before the lack of birth control situation played out. 

Why didn't the woman get educated first, then have kids? The answer 90% of the time? - She made a bad decision. One that society sold her on that was a big lie.


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## none (Jan 15, 2013)

pwm said:


> Want to know who pays all the taxes? This is from the Financial Post today:
> 
> "This progressivity can help us understand why the top 1% of income earners paid a staggering 21.2% of the total federal and provincial taxes in 2010. The top 10% paid 54.8% of all taxes while the bottom 50% of Canadian income earners contributed 4% towards the collective personal tax bill."


I find these stats a bit misleading and give the impression that everyone should be paying the same taxes. We have a progressive tax system and the wealthy get a disproportionate amount of benefits regardless to that.


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## jcgd (Oct 30, 2011)

Such as?


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## donald (Apr 18, 2011)

A lot of the ''working poor" or ''deadbeat dad's" are born into a cycle.They come from a culture of broken homes/single parents/history of zero education/drug abuse ect ect
I'm not saying a person is blameless but the outcome is obvious---A kid growing up in the north end of winnipeg has to basically move mountians to break free.

I have some sympathy for ''deadbeat" dad's--I don't think i would of liked my odds if i was born into poverty/abuse/violence/street gangs,maybe family member's in the prison system...minority(race)I have employed some young men from the ''projects"most people have no idea!This might be more of a social issue though.

These deadbeats grew up fighting from day 1-----if you were born into a healthy loving family you have no idea.It's easy looking at it from a ''middle'' class upbringing and thinking it must be solely the individual's fault----that is the other side(ugly)of the 18 yr old girl pregnant/welfare ect


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## pwm (Jan 19, 2012)

"the wealthy get a disproportionate amount of benefits"

And what would those benefits be?


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## Sherlock (Apr 18, 2010)

A strong middle class is what makes a strong economy. The middle class is smaller in proportion than it was in the past.


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## none (Jan 15, 2013)

On second thought, I'm bailing on this thread. I don't have the patience for it. Good luck finding consensus!


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