Numbers! You know these things? Take the quiz & Better Understand the Budget & Taxes
December 14, 2017 -Steve Hays
I have a request. I have a quiz I want you to take whether you think you know and comprehend large numbers or not. If you know you don’t have a good grasp of large numbers—think in the million to trillion range—then that’s even better. You may, like I did, get a better understanding of them.
It’s hard to escape large numbers these days, especially when they relate to our national budget, or just about anything Congress deals with. Taking the quiz, I realized I didn’t get them as well as I thought.
My only request is that you don’t cheat—no calculator. Go with your first answer. Then you’ll realize just how well you don’t understand these things—or do.
First think of one penny as representing one million dollars.
Ten dollars will then represent one billion dollars.
Is one trillion dollars the same as one hundred dollars, one thousand dollars, ten thousand, one hundred thousand or what? Answer quickly. Go with your first reaction.
In this equivalency test the answer is that one trillion is the same as ten thousand dollars. One penny, a million. Ten dollars, a billion. Ten thousand, a trillion. That wasn’t my first reaction.
Imagine giving over half of a $1.5 trillion tax cut (in this system $15,000) to the top one percent. No matter how you calculate it isn’t that incredibly generous? Remember if a billion is only $10, we’re giving thousands to our 540 billionaires and various multi-millionaires.
If you didn’t cheat by emptying your pockets of loose change to complete the test, you may have a better perspective of large numbers.
The source for this comparison was Andrew Hwang (at theconversation.com). Look there for more comparisons.
Here’s another analogy.
When Congress talks about a “savings” of $200 million, when compared to $20 trillion, that’s like
comparing a $2 beverage to a $200,000 house. Those exist in some areas. Our national debt is almost $20T. When Congress talks of cuts and costs, it generally means in terms of “over ten years.” It’s not instantaneous.
If they wanted to, however, they could come up with a lot of money immediately and balance that give-a-way.
First, as I suggested last month, they could get rid of the “illusory” incentive idea. Just as my dad never paid me my allowance until after I had mowed the lawn—and never paid me beforehand as an incentive—they could give out tax cuts only to those who actually create jobs. Give them a tax credit and subtract the taxes that the people they hire pay in taxes. That’s a reasonable incentive isn’t it? We’d like to give them tax credits like that, right?
We really want them to get huge tax cuts and create the jobs they want to create and politicians say they will. Or instead let’s call it welfare (the kind you don’t have to “work” to get).
This game or dance they do is like Lucy holding the ball for Charlie Brown to kick. The result is too predictable. There will not be a kick—on the ball or to the economy. How many times can we watch and think it will be different this time?
There are ways to save money. Back in 2015 there was an estimated $60 billion dollars in Medicare fraud. Where did it go? Mostly to unethical medical providers that overbill.
The solution? A single payer system can eliminate a lot of the billing mess and fraud.
Next consider the tax credits that reduce Federal tax revenue by $750 billion dollars—every year!
About $203 billion a year in taxes goes unpaid because employee-sponsored health care benefits are not taxed. Do most people need that deduction or health care? A single payer system puts that money into health care.
Add in $83B not collected because capital gains and dividends are not taxed as regular income. About 68% of that benefit goes to the top one percent.
Next notice that corporate tax breaks cost us $176B in uncollected taxes. (NationalPriorities.org)
Now add that $176B to the $203B (health care deduction), the $60B (fraud), the $83B (capital gains) and that’s $522B in uncollected taxes for one year. Three years doing that and it’s over $1.5 Trillion.
That’s without looking at mortgage interest deductions, exempting state and local taxes from Federal taxation, or the several other deductions that Congress wants to “fix.”
Medicare costs $600B a year. That $522B almost pays for that. Actually, since it’s already paid, you could say we almost just doubled Medicare coverage.
Remember that, according to the CBO, 17% of the benefits from major tax breaks go to the top one percent of households.
And 4,000 of the top one percent do not pay any taxes. (NationalPriorites. org)
Well they did earn it. Aaah. Okay, half of them did. Regardless of how they got it, why shouldn’t they keep it all?
One reason is that it ignores the blood, sweat and tears that the poor contribute in lieu of dollars to sustain our society. There’s more than one way to be taxed.
Another way to view it comes from a very wealthy individual, who like half of today’s billionaires, was born that way.
President Franklin D. Roosevelt put it this way: “Taxes, after all, are the dues that we pay for the privileges of membership in an organized society….The privileges of membership in a civilized society have vastly increased in modern times. But I am afraid we have many who still do not recognize their advantages and want to avoid paying their dues.”
A small, but powerful group” he said, that doesn’t “want to pay a fair share.”
Today that’s all too painfully clear.