FRENCHY Loc: Stone Mountain , Ga

I think this is very appropriate with the rhetoric we’re hearing today.

Easy enough for everyone to understand….well maybe most everyone. ☺

BAR STOOL ECONOMICS
Suppose that every week, 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 week 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 weekly 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 adjust each man's bill again by roughly the same amount they are taxed
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 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

NOSLEEP Loc: Calgary

Don't cloud the issue with facts.
The only facts socialists are interested in is whats in it for them...

United Socialists of America

travlnman46 Loc: Yakima WA

Hi FRENCHY: To bad they don't understand simple economics and unfortunately there are many of those who are the nine men that want the tenth man to pay even more because he isn't already paying his fair share. While our politicians take even more for themselves and laugh at the fools they have duped into believing the are being robbed by the tenth man. How's that saying go "Stupid is Stupid does"...

frankeieio Loc: Bend, Oregon

You left out some things. Just before the bar owner lowered prices (slang in that town had some calling the price of beer "rates"), a few well meaning but typically near sighted local officials feeling the need to do something for their constituents, passed an ordinance making it easier for all to enjoy beer by practically mandating that the local beer exchange companies extend their services to those who hadn't proved themselves worthy of such responsibility in the past. Some of these exchanges; companies, who also just recently benefited from relaxed rules, that other local officials had insisted upon in order to allow their political opponents to do good, now could view and manipulate risk any way they wanted. Plus, there were an abundance of foreign Chinese and Asians milling about town, who had made a mint making and selling all those bar stools and knick knacks to the bars and townsfolk respectively, were now hoping to make some easy money investing their cash into this new beer consuming frenzy. The exchange people got real creative, and rich, trying to oblige.

It was all good... beer was plentiful... and the thinking was you can't go wrong with a good beer buzz. Many not used to handling so much seemingly free beer got really drunk. Hell, just about everybody during this time; the townsfolk, the exchange people, the Chinese, the bar owners, the politicians were drunk , one way or another.

Well, good times don't last for ever and after about seven years the whole scenario started to unravel. Fast. It was it turned out a bad plan... economically anyways.

At eight years, most people with the exception of those like the ten friends stopped drinking, or at least didn't go out to bars to drink any more. Bars closed down. Exchanges too big to fail had to be bailed out. People got angry. Fingers were pointed. Some made up simple stories to explain their perspective on event.

And so... in this case a new bar owner took over, and this bar owner very unpopular with about half of the ten, made the difficult but practical decision to raise beer rates back to where they were before they were lowered ten or so years ago... and no matter how one tries to boil it down, I do believe, this is where the confusing rhetoric we are hearing these days is coming from.

Cheers.

St3v3M Loc: 35,000 feet

Here is some easy math for you.

A Long Email + No Link or Author = False Claim
http://www.dailykos.com/story/2008/11/01/649084/-Refuting-Bar-Stool-Economics

FRENCHY Loc: Stone Mountain , Ga

Maybe , coming from this site I don't know , but a few are responding , so.....nobody claim anything ,but someone did it ,who? I don't care is funny to read and of course some are outrage by that ,proved un thing the left is alway pi$$$$$ about something that don't originated from them

dixiemegapixel Loc: Salemburg, NC

Most of us grew up with Aesops' Fables. Of course they were parables. Of course, the facts were made up. Nonetheless, the fables told the story in memorable fashion. How about Ben Franklin's methods of teaching morals? How about philosophy in general? The point is, "is there anything to learn from this"?