Today is the day! No matter what party you are in, do your duty get out there
and vote! From an email I received earlier today:
A lesson in economics...and beer:
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.
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 paid $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
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