Personally I think we should just rid of income tax all together, get rid of special groups and agencies like the IRS, ATF and all that other bullshit and have a national sales tax. I've never understood why that idea makes socialists vomit with rage but having a national sales tax would be the simplistic and most fair way of dealing with a lot of this bullshit.
A poor person buying a carton of milk and a rich corporation buying a jumbo jet are getting hit exactly the same.
You can debate free market v command economies all you want, but it comes down to a matter of opinion most of the time. You just need to be honest about the pros and cons on both sides. Conservatives like to see themselves as grown up or 'mugged by reality', as the expression goes, but Marx and Engels' ideas came out of living in the UK and seeing the terrible inequalities that were being perpetuated by those at the 'top' at the expense of those at the 'bottom' during a period of rapid industrialisation. Human beings were being treated like livestock, and a small group were profiting at their expense. The Communist Manifesto is one of the most elegant and economical analyses of the situation that people were facing, and much of it remains relevant today.
Capitalism might free up brilliant people to pursue innovation and change the environment for the better, but it also produces cartels and manifold instances of graft and corruption that need to be addressed and checked. That can only be done in a system where there is oversight at the administrative level - it cannot be done by 'the market' without creating massive upheaval and social breakdown. There is also a Victorian/Thatcherite notion that people who don't work 20 hours a day and run their own businesses are somehow not useful members of society. A lot of people just want to do a fair days work and get reasonably remunerated for their labour, not raped by an employer who is constantly trying to trim his costs and increase his profit margins by undervaluing human capital. For all its inefficiencies, governments can mandate a reasonable reward for someone's labour, for example; otherwise it is just a race to the bottom where we are all running faster to stay in the same place and neglecting important things like family life.
If you are someone like Ron Paul, none of these concerns about social cost have any significance, because 'the market' will sort it all out for us. Well, perhaps it might in the end - just as a catastrophic fire can help to clear away rotten buildings - but the idea of a planned economy is that we don't need to reach that stage. Right-wing types love to talk about market 'corrections' as though it never really has any impact on society, when we are talking about unemployment and social breakdown that can have generational effects. Advocates of a more or less pure capitalism are totally uninterested in this, and just tell everyone that they should work harder, like Boxer the shire horse, and stop moaning.
The whole idea of a national sales tax being somehow 'fairer' is just plain bloody stupid in my opinion and reveals how out of touch these people tend to be. Taxing some plutocrat's yacht at the same level as a single mother's groceries is NOT THE SAME!! In one case, you are talking about expenditure that is purely discretionary, on the other you are talking about necessities, pure and simple. A progressive tax system recognises that some people have more ability to pay than others. The fact that some people don't see that a flat tax rate is actually unfair for someone on a severely limited income amazes me, but I guess I am being naive and not facing facts.
I think you can tell from the people who post here that the capitalist types have a very pessimistic attitude on the whole. Socialism, for its many faults, does recognise that human beings can be improved, and that there is no need to accept the status quo ante all the time. Using Stalinism as way to discredit the whole idea is intellectually dishonest. Marxists often defend their ideas by saying that they have never actually been tried, but always corrupted by despots. This is actually true. I don't actually identify with one side or the other in this debate, but the way that people dismiss Socialism as some fatuous pipe dream really needs to be addressed sometimes.