Grand Theft USAF
Stranger Here Myself
Those of you checking the Administation page of the eUnited States lately could see two tax proposals there being voted by the Congress - the body claiming to represent your interests.
Vanek26's proposal
Gnilrap's proposal
These two proposals will raise the income tax on both Food & Weapons to the maximum: 25%.
Now let’s see how they will affect the total potential tax revenues to be budgeted by the Congress (aka the amount of money the government can spend):
No, don’t bend closer to the monitor, it is what you see: despite the 10-percentage-point raise of the income tax, budgetable revenues will not increase by a single cent. Wtf? They are raising taxes and that won’t earn the state a cent? Exactly. Insane, isn’t it? The reason is that the Congress can only donate 99,999$ a day to the CBO (Congressional Budget Office, an organization tax revenues are donated). And tax revenues are already over that cap (~130k a day).
Now let’s take a look at how these proposals will affect the purse of the average American worker.
The chart above shows the price structure of a tank (Q5 Weapon) as of around 20:00 eRep time - on the eUS market. In other words, the distribution of the money you pay for it.
The biggest part of that price is the raw material cost. Your click on the company of your employer turns 50 Weapon Raw Material units into a tank. 50.9% of the final price is the raw material. Everything above that is the value added by your work click - and of course your employer’s clicks on posting offers on the Job Market, purchasing the raw materials and selling the finished goods on the market.
Your employer - that evil capitalist pig taking the much envied ‘hefty profits’ - then pays you. 33.55% is his/her Labor Cost - the money he must pay to get you click ‘Work’. But hey, looking back the chart your net wage is only 29.2%! Indeed. The rest goes to taxes. With the proposals before the congress it will be only 25.8%. The rest is taken by the CBO - to be redistributed among eUS citizens. No, wait! You took a job on the Job Market (shame on you… you … worker!), so you will not receive a single cent back from that. It will fund the tax evading communes of the USAF and the “CBO-approved” militias. Yes, that share of the value of your work is indeed bigger that the ‘hefty profits’ of your evil capitalist employer. This is what they call ‘commune efficiency’. We might as well call it an open theft. You do the work, they take the harvest and spend it on their own development. Note: neither the 1st ranked eUS military unit, nor the much-criticised US Military are included in that circle of beneficiaries - let alone all those "little" militias who receive no state funds at all.
When Vanek26’s proposal goes through, the price structure will (theoretically) change like this. Theoretically, as lower profits will most probably act as a disincentive for employment, so wages are very probable to fall. The government will take a bigger slicers of your shrinking pie. Take - but not use. Congress will still be unable to take out more than 99,999$ of the Treasury daily.
Bt that’s the same everywhere, this is how the game works, isn’t it? Not quite. Take one of the most robust economies of the game for example. Poland has a flat 1% income tax rate as well as 1% VAT. Let’s check their price structure:
Zany. These clownish Poles are surely committing a national level suicide, following Eli Crownover’s logics them being wiped is surely imminent. But wait! Aren’t those guys keeping half of Europe invaded for months? Weren’t they crossing the Atlantic to invade this quasi-Bolshevik Disneyland here?
But the net wage share is still lower there then in the eUS, isn't it? sure. But let's see how big that pie really is. The following chart shows the purchasing power of wages in the eUS, Poland and Indonesia. The first column is how many tanks you could buy for your daily wage. The second indicates how many Gold you make in a 30-day-month.
Got the point? Nevermind, they are surely doing it wrong, maths might hurt your brain, go and take part in Gnilrap’s trolling contest instead … and of course, keep paying for his drinks and shut up.
Your economic affairs will be taken care for by the the organization of immense experience, unprecedented insight and almost divine wisdom - at least that’s what they claim. They are called the Economic Council. Yes, you are perfectly right , you never elected an Economic Council - let alone authorized them to take your money and give half of it to the ~8% of the eUS population.
Yes, it is the same Economic Council whose declared “sole purpose will be to advise those who ask for advice”. Of course you haven’t elected them. “Neither Congress nor the Executive have control over the EC”.
In turn, the Economic Council practically has total control over the budget and the taxes. In other words, it is not your damned business at all how those ‘economic gurus’ take your money and who they give it.
In the early phase of this current debate Congressman portocolombus inquired about when the EC would come out with their opinion. EC Chairperson Evry replie
😛
“When we're done deciding on the best course for taxes for the country.”
That might simply mean they are trying to set their minds up about how to advice the Congress. However, if your read the exchange between Vanek26 and Dan Wang (who questions the need for entirely the business of deciding on taxes to the Economic Council) you’ll see how any attempts to reinstall Congress’ control over fiscal affairs is immediately and agressively rebutted by certain circles. And those ‘certain circles’ somehow happen to be rather identical with the primary beneficiaries of the current Socialist nanny state: the prominents of the USAF. Checking the most vocal supporters of the current (maxed out) income centralisation you’ll find the same tags: EC, NSC, and various USAF commanders and captains. Some might fancy calling them the ‘elites’. In fact they are the ones deciding about practically everything important in-game. And there not necessarily anything wrong with that.
But only as long as their claim their governance “best protects the interests of America, her allies, and the business for both” is true. Howver, the current proposals raise some serious doubts about that.
We’ve already discussed here how the new proposals will:
- NOT increase budgetable revenues by a single cent
- HURT he purchasing power of everyone taking a job
But why on Earth would those ‘brilliant minds’, the crème de la crème of eUS economist, those most trusted gurus propose such a useless and dumb proposal? Were they drugged by public enemy number one Pth? Is that some conspiracy by the evil JCS?
Let’s quote the chairperson and the EC members again:
“Basically, Income taxes inactive players while VAT taxes the actives. We want to tax those not contributing as it would encourage them to participate more and join a commune which essentially shelters them from the Income taxes. VAT needs to be low to encourage weapon and food buying which increases our damage output.” - Evry
Yes, believe your eyes: if you take a job and work, you’re an ‘inactive’. Even if it is exclusively you funding the development of those who evade the same taxes by joining the communes. The ultimate goal is to force you to be ‘active’ - evading taxes and depend on the supplies give to you by those brilliant economic gurus - buying you weapons for other people’s taxes. This is what they call ‘commune efficiency’. And it DOES work. As long as they don’t run out of other people’s money. Google “Nicola Pozzi”.
“remove a portion of the burden from those who work for only $1 a day.” -Eli Crownover
“We would still be bringing in approximately the same daily revenue, but would just be making life a little less expensive for the active members of military units that are currently working in communes.” - Eli Crownover
This is the real explanation why they proposed this perfectly useless tax table: forcing those maintaining any traces of independence from them - into their communes where supplies and employment could be controlled without the annoying competition from the private sector.
The whole tax reform is practically a scam. They take a huge share of your wage and then point out how ‘inefficient’ the private sector was. It is pretty simple to check whether your ‘commune’ really does care about you, or is simply scamming you to fund someone else: if you received less than 233.8$ (or equivalent supplies) yesterday - you received the exact value of your work click (without government funds). If you received less than that- you are scammed.
But don’t worry. We all are.
Comments
Look dude, if you're going to quote me, at least get it right. Dropping the VAT will make EVERYTHING on the market less expensive. Did you read that correctly? EVERYTHING. If we're able to drop the VAT down to 5% or less, that will be less cost passed on to the people who buy from the market. That's people who don't get free stuff in the communes.
Less than 3 months ago we were still recovering from our last invasion. We went through MILLIONS of dollars in reserves in a few short months to repel the invaders. We are now in the process of rebuilding those reserves as quickly as possible while trying to have the least impact on the market. That's why we're working to reduce the VAT. That's the end goal here. Find a way to maintain revenue and reduce market prices. Why are you so against that?
"We are now in the process of rebuilding those reserves as quickly as possible while trying to have the least impact on the market. That's why we're working to reduce the VAT."
I've already debunked your lies about that - quoting YOU word-by-wor😛 ""We would still be bringing in approximately the same daily revenue, but would just be making life a little less expensive for the active members of military units that are currently working in communes.""
The "same daily revenue" would build no reserves, right? Yo simply want to FORCE people into your militias. Sheer politics - ZERO economic rationale.
"If we're able to drop the VAT down to 5% or less, that will be less cost passed on to the people who buy from the market."
Another obvious lie. Raising income taxes by 10 percentage points and lowering VAT by 5 will result LESS purchasing power of wages. The only beneficiary is again your tax evading/tax spending communes - you will be able to purchase more supplies - for the money you take from the average worker. It's not even Communism. That's simply the robber baron's undisguised feudalism.
V
Down with TERRBL ELITISTS!
"Down with TERRBL ELITISTS!"
Nope. I couldn't care less about your obsession with power & control.
Down with parasites.
SHM maybe you could help me out here. Why do you focus on "budgetable revenue"? How does that differ to revenue simpler?
love you
'budgetable' revenue refers to the amount the government could actually take out of the treasury and spend it. there is a hard cap for that, a maximum of 99,999 CC can be donated from the treasury a day. that's a technical limit, hard-coded, fixed. however, tax revenues over that limit will flow into the treasury. too. Eli Crownover's claim above refers to increasing that reserve in the treasury - in case revenues fall below 99,999$ a day sometime in the future. however, she had repeatedly stated during the congress debate, that she (and the EC) wanted to maintain the current level of revenues - by decreasing VAT. so this is a kind of rhetorical double-play of them: they claim tax raises are needed to build that (currently) unavailabe 'reserve' - and at the same time claim the total revenues will remain unchanged. obviously, these statements cannot be true at the same time - it's pure bs.
good article
If I remember correctly you used to be able to get around the 24hr limit by purchasing a defence system or hospital for 99,999 from a reliable source. So it may be possible to breach the hardcap i dunno.
25% does seem like a helluva lot of income tax
all very interesting.
just a note, though... I don't get anything "free from the communes" as suggested. I work, and take my wages in weapons or food instead of cash-- in other words, I EARN, not "get for free."
1) Indeed. However, it is highly questionable whether it was a reasonable thing to further increase the burden of the average citizen to build hospitals and defense systems - when most of the population can't even afford fighting all possible food rounds with Q5 Weapons. Let alone saving up for companies to increase their incomes.
2) 25% is actually the cap for income taxes. No higher ones are possible to set.
GAC:
"I don't get anything "free from the communes" as suggested. I work, and take my wages in weapons or food instead of cash-- in other words, I EARN, not "get for free."
If you are NOT a part of a commune receiving government funds (made of tax revenues), you indeed do.
Good read.
First off, this is a great article. Even though I disagree with its conclusions (and I will explain why in a moment), I am overwhelmingly happy to see such excellent reporting. Kudos SHM.
Now, there is one major, and one minor variable that this article has not taken into consideration and they are at the heart and soul of the new tax plan.
The minor variable is the so-called bot that is not supposed to be talked about lest you risk FP. If you know about it, great. If you don't, you'll have to contact me privately and I will fill you in so I don't get FP'd for talking about it here. But what I will say about the bot is that the EC has been studying its behavior VERY closely for months and we believe that this new tax plan is the best insulation we have against the bot's deleterious effects on our economy.
The MAJOR variable that this article does not take into consideration is the effect of our tax plan on the USD/Gold market. Far more important than whether you can afford 4 or 3.9 or 4.1 weapons per day on your salary is how much it costs in USD to buy Gold. I can tell you that the Gold market is the #1 concern of the Econ Council and of Congress. Gold is the only currency that truly matters in this game, since it is Gold that will ultimately convert you from a consumer into a producer.
So I will ask SHM - who obviously knows his sh*t bigtime - to reconsider his evaluation of this tax plan while taking into consideration the quirky (and obtrusive) behavior of the "bot" as well as the all-important (to communed workers and non-communed workers alike) price of Gold in USD. I am confident that he will undergo the same revelation that nearly every other congressman has undergone (support for this plan was a long battle and those who engaged the discussion were convinced by the logic of the plan for the good of our Citizenry).
This tax plan will result in lower cost of goods on the market and it will be a buffer against further increases in the Gold market.
SHM, most income these days is derived from selling WAM goods and not from employment income. For every person working one job they are probably WAMing half a dozen or more on average by my speculative guess. I'm all in favor of them taxing my one income from working than my multiple income from WAMing. My point is that for many people you might want to think of it as a tax drop instead of a tax increase.
If you are that worried about your eUSD, spend $13 real USD and get gold that you can sell for thousands of eUSD.
Excellent, enlightening article!
V + S + friended
1) the bot(s)
Yes, as a trader and mm speculator I do know about the bots. I also have a general understanding of what the EC could have figured out (not directly, as the EC doesn't bother to publically explain sh*t - but from Kemal Energekon's article on import taxes). I also perfectly understand the EC's vision behind the current proposals - and I'm firmly convinced that it is fundamentally flawed.
2) the Gold/USD rate
That is merely the cheese in the mouse-trap. The basic flaw is closely-related to how the bots work. I'm sing plural because I here refer to BOTH the bots on the commodity markets AND the ones on the _monetary_ markets. I do believe some (but not all) arguing for the current proposals honestly believe they would generally help the eUS economy as a whole. Bt these assumptions are merely based on an incomplete understanding of what purpose those bots actually serve - from "Plato's" point of view.
This tax plan will result in lower prices on the markets - and an even lower purchasing power parity of ALL eUS TAXPAYERS. Gold prices will keep following global trends though, as they are only related to the primary loop of the dual money system loosely. The only winners will be the tax evading/tax spending communes (and especially those running them). Everybody else will only lose on this.
enderaggie:
given that you hold an eChinese citizenship (10% income tax there), I perfectly understand that you'd anytime trade an (eUS) income tax raise for a cut in VATs and Import taxes.
First off, great article.
Anyone who knows me, knows that I love to argue over taxes. Its an important aspect of the game and one that is frankly, allowed to stale too often.
Higher taxes suck, period. However, I think this hike can be beneficial to us all IF the government does this right. We have all heard of this infamous admin bot that buys goods from the market at certain price levels, injecting more USD into the system thus causing the value of the dollar to sink. I am a bit skeptical as to the impact of the bot, but I do believe it is real as i have often sold goods at more than the lowest price offered.
So we face a problem, the dollar is weak as heck. It costs nearly 1000 USD to buy one gold. Gold is the most important currency and is needed by players daily to keep pace in strength traing, build companies etc. So in a game where the goal of the admin is to sell us virtual currency (gold) to make profit, it seems plausible that they would want currency to have as little value as possible.
How can we combat this? By raising taxes. By increasing the amount of tax collected daily, more USD is sucked out of circulation and if done in large enough quantity and handled properly, this removal of USD can increase the value of the USD allowing more people the ability to buy gold cheaper from the monetary market.
While it is true that we can only take out 99k per day via Congressional donation, we can take another 99k per day through a buy constructions proposal. A hospital or DS is put up up for 99k and the Congress buys it. The benefactor of the sale then donates the 99k to the CBO. So in reality we can take out almost 200k per day.
With that said, I'm in favor of this, IF and ONLY if the excess USD is permanently removed from circulation. This can be accomplished by raiseng the new citizen fee, giving USD to citizens to buy land/storage in bulk, giving USD to militias to buy q4 raws companies.
I have a job in eUSA but I run my companies in China to pay the labor costs for my SF communes (they get paid in CNY...not USD). Thus, I have far more to lose and less to gain by this change so don't think I'm arguing for what benefits me.
Oh, and I also meant to agree with gnilraps...like your writing such an indepth article but I do disagree with your message.
Myself and many others have mentioned this on the forums many times, and often the response is, "well we can stockpile the excess and it has the same effect" or "why would we waste USD when we can build a reserve"
The answer to that is simple. If the USD is not destroyed (by using it to buy from the admin) it is still able to be injected into the system. And it often is. We get invaded, bam, its back in circulation, we want to kill Spain for the fortyth time, bam we inject it back into circulation.
Take the excess money, and BURN it. Give it to people to buy land/storage/q4 raws, raise the new citizen fee so that those who do die off after one day take some of th excess USD with them. WE HAVE TO try and find a way to remove USD from the economy at a faster pace than this bot injects it. If we try and fail then so be it, at least we tried to combat it.
Good article. V + S
Donate excess USD to Eugene Harlot.
http://www.erepublik.com/en/citizen/profile/772321
Also, if people have noticed, the interesting side effect of this tax change is that more people are involved in the game now. Active players are going to be seeking ways to avoid paying taxes, which is a good thing. Active players receive benefits of this change since prices of goods will be lower, while the two-clickers continue to do their part for the country by paying taxes so we can continue to win wars.
Now the point where this whole debate gets off the rail is the assumption that while the buying bots 'inject' CC (here USD) into circulation, the money supply would be a closed and independent system - apart from these 'pumped-in' amounts of CC. B_ut that assumption is actually false - together with all the rl based speculations based on money supply models. Gold prices -as well as commodity markets - are also artificially regulated by admins. I made my fortune on CC/CC markets. For that, I've monitored, documented and analysed the top 20 CCs (as well as a few minor ones). I tried to apply some 'global macro' on that - and failed. What I saw were weird deviations from how the markets should work based on the inner logics of game-mechanics and what we know about the (commodities) buying bot. It is apparent that monetary markets are also being 'regulated' by buying bots - on the CC/Gold side. This is a thing many the attention of many e-economist tend to pass over. The usual claim is that 'admins are greedy and want to make Gold ever more expensive'. However, that is only a half-truth. While they surely want to keep a constant demand for Gold, and keep the whole economy in constant "overproduction" - they don't want to let that run loose either. Seeing all those 'irrational' sales on the CC/Gold side we easily believe these are all 'stupid noobs'. But that's not the case.
"Also, if people have noticed, the interesting side effect of this tax change is that more people are involved in the game now. Active players are going to be seeking ways to avoid paying taxes, which is a good thing. Active players receive benefits of this change since prices of goods will be lower, while the two-clickers continue to do their part for the country by paying taxes so we can continue to win wars."
False from A to Z.
Stranger how would you rebuild our treasury? Most larger nations have over 10 times as much in their treasury. When we are invaded again we will need the funds in our treasury to tide us over presently have 3 to 5 days worth of expenses in th treasury this has to be increased, so how would you do it?
Don't like to hear the vacuous and dishonest bs.
You are correct in asserting that the ultimate purpose of the "bot" is anybody's guess, since it officially does not exist. But it's behavior is at least predicative and we can react.
And yes also that the bot/Gold market relationship is probably the key one.
On another note, it gets old listening to people complain about Congress or Econ council or whomever having "Private" conversations. What's so wrong about that? We all know that privacy and close trust amplifies certain conversational dynamics. Absolute transparency in certain kinds of discourse results in a reduction in quality.
In my 4 terms in Congress I have observed a very decent respect for what should be posted publicly and what should remain private. Don't forget, every congressman is a citizen too. Trust me, private congressional boards are no more exciting than the public ones. 😛
Also, by "Inactive", the people being referred to are those who are totally just two-clicking. They make up the majority of salaried workers. The Citizen who is consciously objecting to MU/Commune work is the minority.
"False from A to Z."
Don't like to hear the truth? Provide some factual arguments why having more active players benefit from this is a bad thing.
Leroy Combs: Pretty easy. Cut spending & avoid getting wiped. The eUS is not a desperate little Whateveristan, but the 10th biggest power in the game. If we get wiped, the govt's doing it WRONG!
Gnilraps: "On another note, it gets old listening to people complain about Congress or Econ council or whomever having "Private" conversations. What's so wrong about that?"
The fact that you are deciding about OUR taxes behind OUR backs. Discuss how you want to spend your own fund behind whatever closed doors. But if you're handling OUR money it's OUR business.
"Trust me, private congressional boards are no more exciting than the public ones."
I'm pretty much sure about that. Most of the times secrecy in eRep merely serves hiding incompetency.
"Also, by "Inactive", the people being referred to are those who are totally just two-clicking. They make up the majority of salaried workers. The Citizen who is consciously objecting to MU/Commune work is the minority."
On the contrary. Those working in communes are the (small) minority.
Kell Draygo: Read the article, I did exactly that. Not just pushing some stuck-up bs like you. There are the figures. Disprove them - if you can!
Already done. Active players benefit from the changes, read The Libertine's article on avoiding taxes: http://www.erepublik.com/en/article/ten-easy-ways-to-avoid-paying-taxes-1886144/1/20
Active players can avoid taxes if they wish, so they will benefit. People who fight for our country in their military and militias will benefit from this change. People who work in other forms of communes will benefit. The only people getting taxed more are the two-clickers who wouldn't really care since they are just two-clicking, and people such as yourselves who wants to push numbers that fit your arguments. It is a good article but it doesn't account for other factors. In the end, it benefits the country's active population.
Interesting article.
@Leroy Combs: The purpose of this legislation isn't to increase or decrease revenue, as I understand it and as Evry explained to me.
The purpose is to push people into communes, which won't work. It will just push people who weren't active farther away.
"Leroy Combs: Pretty easy. Cut spending & avoid getting wiped. The eUS is not a desperate little Whateveristan, but the 10th biggest power in the game. If we get wiped, the govt's doing it WRONG!"
This just proves how little you understand this game. You can't say 'Avoid Getting Wiped' as if it's like snapping the finger. You decrease the spending and the chances of us getting wiped gets increased.
Good read, voted.
"You decrease the spending and the chances of us getting wiped gets increased."
My *ss!
"The purpose is to push people into communes, which won't work. It will just push people who weren't active farther away."
Exactly!
Stranger, please explain how we can avoid getting wiped when our damage for ourselves and our allies decreases due to spending cuts? The best way to avoid getting wiped is to work closely with our allies, that means being for them when they are in need.
"when our damage for ourselves and our allies decreases due to spending cuts?"
Spending cuts (if accompanied by tax cuts) would actually increase total potential national damage output. They would certainly decrease the damage of those progressing at the cost of parasiting others though.
Stranger, how much more damage can you do a day if taxes weren't 25%?
"The fact that you are deciding about OUR taxes behind OUR backs. Discuss how you want to spend your own fund behind whatever closed doors. But if you're handling OUR money it's OUR business."
Um...that's why YOU elected people that would decide how to spend YOUR money. They are just doin' their job...of course I would not deny your right to voice discontent but maybe you'll run next time, no?
SHM, you elect congressmen to handle tax policy. That is your say. You also can run for congress so there is no access issue here.
I have always believed in the sanctity of a closed door policy when people need to gather to discuss sensitive issues. It facilitates healthy discussion.
By the same token, everyone knows who the congressmen are (and if you need the list it is here; http://www.erepublik.com/en/article/46th-eus-congress-1870749/1/20) and every single one of them is accessible to you via PM. Don't tell me you don't have a voice in government. My guess is that you have a better voice in this game's government than you do in RL...
Also, please join our country's forums where we also discuss these issues: http://eusaforums.com/forum/index.php
The invitation is for everyone to join and participate in the country's community.
There is good reason to amass a treasury larger than needed, for various reasons but maybe not that important for such high taxes.
Either way, this article reflects SHM's RL views on communism, socialism and et al. Can't seem to drop them, and refuses to enjoy the game.
From what I read the reason of raising taxes is for reserve, and to take money away from "two clickers" and give to the active. Know this the active does not need to be in usaf, militia, or military unit to be active. Thats why the increased revenue should go to meals on wheels and a reserve. The active will request and the inactive wont
FYI: Just saying "you voted therefore you can't disagree", is a logical fallacy, I'm pretty sure.
Before I start, please note that I have not taken a side in this debate (yet, at least). As a member of the JCS-led eUS Military, obviously I don't benefit from government tax money for my military unit, but that does not necessarily mean I don't want what's best for the country. In short, I have an open mind on this issue (for now)...
One question for those stating the tax measures will increase the value of the USD to gol😛
If "the bot" is controlling the amount of USD in circulation to some degree, what's to say you go ahead and enact those tax changes..... and the bot turns around and compensates EVEN MORE to offset the tax increases. Isn't this entirely possible (and, dare I say, likely)? Then we'd really be in a bad place -- higher taxes *and* devalued currency!
Comments? Thoughts?