Good article. I noticed that some of the opposing comments shot the messenger didn't address his numbers (which are easily verified). 

And if you insist on getting stuff for free you are an altruist.

Once upon a time people use to say "you take what you can get".

These days the saying is more like "you take what he/she gets".

They say it takes one to know one. If rich people are greedy than those who accuse them of greed must also be greedy since they want what the rich already have.

Greed is such a boring bogeyman, as if greed doesn't exist in socialist or communist societies.

Spooky how prescient that Adams quote shows him to have been.

if you had told a guy in 1870 that 42 workers would support 1 retiree he'd claimed that this is impossible and will destroy society. Increase of production efficiency makes more than up for it.

The Employment rate in most western countries is higher than it was 20 years ago :

http://www.oecd.org/dataoecd/15/24/38335554.pdf (its only from 1992 to 2005 but it shouldn't have changed too much recently , even with the rise in unemployment as historical data in western societies shows that there is only a very small correlation between unemployment and employment ratio, unemployment is largely irrelevant to the economic success of a society anyways, the employment ratio is what is important)

You can also see that countries with a universal social security system don't necessarily have a lower employment ratio (Island, the Scandinavian countries and Switzerland have very high employment rates for example)

for the USA I also found a graph showing it back to 1966 :

http://de.statista.com/statistik/daten/studie/16959/umfrage/usa%3A-beschaeftigungsquote-15-64-jahre/

(its german but its easy to understand it shows the % of people between 15 and 64 who work)

I have no real clue about the US tax system but I am quite sure that all those people who don't pay income taxes have still to pay a lot of other taxes and taking just a single tax to show that they don't contribute seems a bit unfair for me.

Depends on what you are talking about when you say "contribute".

People who do not pay income tax are not contributing to those expenses that are paid with money coming from income tax.

You can hardly say that they are contributing to X because they are paying minor amounts to Y.

Not sure what this has to do with the subject...

Again, not sure how this is relevant. Of course there is a steady rise in the percentage of people who work. Individuals work fewer hours than they used to and since the 60s many women have joined the workforce.

The point is that with the current income tax system, half of these people are not contributing to the system. They only work for themselves, whereas the other half works for the state and themselves.

What? Everyone in 1870 would have understood that 42 workers can support 1 retiree. You don't need much production efficiency for that. Even a hunter-gatherer society can support retirees.

How many children do you think people had in the 19th century that 42 supporting 1 old guy would seem ridiculously low???

Unfortunately the document titled "EMPLOYMENT RATES BY GENDER" has no statistics for employment rates by gender. So we cannot easily see how many women joined the workforce.

Here are the links again, this time correctly marked as links and clickable:

http://www.oecd.org/dataoecd/15/24/38335554.pdf

http://de.statista.com/statistik/daten/studie/16959/umfrage/usa%3A-beschaeftigungsquote-15-64-jahre/

They are still not relevant though.

it is very relevant if you look at the topic of the thread : "the producers and the takers". The majority of the so called "takers" are "producers" as well as they have an employment and there fore produce goods or services. Calling them takers is so wrong from a macroeconomic perspective. You can call the unemployed people "takers" if you want.

PS: sorry for the bad links , stardocks forums still have a problem with opera

He wasn't talking about the unemployed.

He was talking about those who merely use services provided by the federal government and those who actually pay income tax.

The "takers" here are not (just) the unemployed people but all those who don't pay federal income tax.

The percentage of employed people is here quite irrelevant as he was not talking about WHY they don't contribute just about THAT they don't contribute.

as I am not familiar with the US tax system could someone please list me up what kind of taxes/fees/whatever a single person household with a income of 15.000/25.000$ pays roughly.

Having a macroeconomic and sociological education I do have to say that I find the concept of distinguishing between federal and local taxes to imply that some people are producers while others are takers quite disturbing. It surely makes sense from a political standpoint but whom you pay the taxes to doesn't affect the wealth of either you nor the society as a whole. The thread as I read it has the connotation that all those who don't pay income tax are at the fault of potentially destroying the american dream, when it is just a potential problem of how the money in between the different government agents is to be distributed.

Then don't do it.

But coming back to what Brad quoted, those people who pay the income tax are "the people who pay the bills" and the people who use government services but do not pay for them are "the people who live off of the fruits of their labor".

I find it disturbing that you apparently cannot say anything about the actual point (some pay, some don't) and instead keep referring to another issue (some produce, some don't).

Have you ever tried this in real life?

Go to your local supermarket and tell them that you won't pay them for the goods you took because it doesn't affect your wealth or society's if instead you pay the money to somebody else.

It doesn't work that way.

The way I read it it sounded to me as if those who don't pay income tax but still demand payments from government (financed by those who do pay income tax) have already given up the American dream and are destroying it for those who still believe in it.

I don't think distribution of the money is the problem here. This thread was about whence the money comes, not whither it goes.

If you have a sociological education, you can certainly understand this example:

A school has an annual party for all kids.

Half the kids bring candy and soft drinks for everybody.

The other half do not.

All kids regularly bring candy and soft drinks for their own consumption.

And all kids regularly bring candy and soft drinks for class parties (to which kids from other classes are not invited).

Questions:

1. Would it be fair to say that for the school party half the kids have contributed and half the kids have not?

2. Should the kids who haven't brought candy and soft drinks complain about the fact that there is not enough candy and soft drinks for everybody because the other half have not brought enough?

3. Does it matter whether a kig usually contributes candi and soft drinks to class parties when we are determining whether they have contributed to the school party or not?

If you include the "hidden" share of SS/Medicare taxes that the empoyer is required to pay on the person's behalf (which could otherwise be higher pay for that person), they would be paying at least $4-5k annually for all federal taxes combined, plus another $500 to $1000 to state/local, depending on where they live. So even in the middle of that range, a single taxpayer would be paying in or having paid on their behalf around 25% of their income. That doesn't even touch on state sales taxes adding an additional 5-10% to the cost of any non-food purchases.

Having a non-working spouse or at least one dependent would reduce those federal taxes by around $1000-1500 and reduce significantly or eliminate the state taxes. There are also a number of refundable credits (standard credits would not help beyond that point as the remainder would be entirely SS/Medicare taxes) available that could further reduce the taxes.

I don't have census data at hand, but I'd wager that at least as many people in the sub-$30k bracket (who are not themselves dependents, such as working students) have spouses or dependents as don't.

Leauki, the working people produce goods and services, those things are what make up the economy not some income tax. By providing those goods and services they contribute to the wealth of society (and no they don't work for themselves as they don't consume those goods or services themselves) and the whole financial system around it is just a way to increase the efficiency of trading. You also have to ask yourself the question if those who pay income tax would be able to do so without the paid work done for them by those who don't pay income taxes - surely there would be some people still making the same income but if you theoretically eliminate a large portion of the working force I am sure it would have a quite negative effect on the income of the remaining people.

Economy is not about fairness it is about growth and even more about stability and who is more likely to cause unrests? A small group of people who have to pay income tax yet are still better off then the majority or a large group of people which has less to lose and more to gain?

Your party example is flawed as in your experiment one group doesn't provide anything at all to the whole system, while in reality the working part of that group called "takers" here just doesn't provide something to a part of the system. In the party example it is more like one group just bringing candy and no softdrinks. ( excise tax is federal isn't it? , the tax the employer pays for the medicare is as kryo said as well a tax on work hence on the worker and it is just a arbitrary construct that the employer and not the employee pays it)

Irrelevant as we are not talking about the economy here but about the income tax.

The example is not flawed. The kids who don't bring anything to the party are the equivalents of those who don't bring anything to the federal income tax. They might contribute in other ways (although they rarely do), but it is still fair to see that they are not contributing to the party.

The fact is that everyone profits from the services government provides but not everyone pays for those services. Yet those who don't pay always feel like it is more "just" or even "altruistic" to let the others pay more.