Debt Ceiling Economics at a Bar

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. He said, "Since you are all such
good customers, 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 every body'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 $2 ? 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 any more. 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. I am positive there will be plenty here that will not understand this and want to argue.

Truth must have hurt too bad on this one for the Blue Pill Liberals to comment or understand.

Were you posting for the liberals or for those who might agree with you? Few liberals take the time to read your cut and paste jobs and those who would agree with you have chosen to keep their distance.

Originally Posted by F-Sharp

Oh you have finally recognized that your logic is burning your brain.

The Ftard is on Fire with non brilliance.

Were you posting for the liberals or for those who might agree with you? Not really posting for anyone just figured you Libs would do the usual insults. Few liberals take the time to read your cut and paste jobs it would be nice if that were true. and those who would agree with you have chosen to keep their distance. Originally Posted by Booth

Conservative just have more class than the dirty libs and choose not be dicks to everyone they disagree with. I don not think they are avoiding me just showing more class than you do.

Conservative just have more class than the dirty libs and choose not be dicks to everyone they disagree with. I don not think they are avoiding me just showing more class than you do. Originally Posted by Wyldeman30

The thread was ignored by conservatives and liberals alike. It was your comment on the thread that brought my response. Exactly what did I say that you consider not classy? If GFE calling anyone who voted for Obama a cocksucker and following it with a link to a biblical story is your idea of class you should consider taking the blinders off.

I was talking about the ones that choose not to get in a pissing match. Conservatives tend to be more civil than the crybaby libs.

But how about crybaby conservatives vs. crybaby libs? Are you so narrow minded that you don't think there are crybabies, and for that matter good and bad people, on both sides?

Oh you have finally recognized that your logic is burning your brain.

The Ftard is on Fire with non brilliance. Originally Posted by Wyldeman30

Don't you really mean something like: "I know you are but what am I?"

BTW -- what is an Ftard, Wyldeman?

But how about crybaby conservatives vs. crybaby libs? Are you so narrow minded that you don't think there are crybabies, and for that matter good and bad people, on both sides? Originally Posted by Booth

You know you guys cry a lot more and more often. It is all about you all the time. You know the only one that cares about how smart you think you are is you. So if I am narrow minded are you absent minded.

"...whatever you say, bounces off me and sticks to you!"

You know you guys cry a lot more and more often. It is all about you all the time. Originally Posted by Wyldeman30

I know no such thing. Nice try.

All I got to say is Whatsup.