Bush Tax Cuts

[Rinualdo]

This came up as a policy discussion a couple of times in other threads. I found it interesting that Liberal, Socialist, pinko nut-job Alan Greenspan made some comments on them recent.

http://rawstory.com/rs/2010/0801/greenspan-end-bush-tax-cuts/

[Parkbandit]

If you want to get out of this recession, make all the tax cuts permanent and seriously cut spending. Take the money that is still unspent from the "stimulus" and pay down the debt.

If you want unemployment to drop, stop punishing the people who are doing the hiring.

[Rinualdo]

You realize that there is a difference between an individual and their taxes and a corporation and their taxes I presume?

[Keller]

You realize that there is a difference between an individual and their taxes and a corporation and their taxes I presume?

What an overbroad question.

What does it even mean?

[Fallen]

What I would like to see happen is the Obamacare legislation repealed along with the tax cuts, and all the extra money be put towards the debt.

[Rinualdo]

Or we could get the fuck out of Iraq, cut the military in half, and use that money to pay off the debt.

[Keller]

Or we could get the fuck out of Iraq, cut the military in half, and use that money to pay off the debt.

Back to your statement about the differences between corporate taxes and individual taxes and how that was intended to refute PB's statement that you should reduce taxes on the job creators to decrease unemployment.

What is that about?

[Parkbandit]

You realize that there is a difference between an individual and their taxes and a corporation and their taxes I presume?

Let's pretend I don't... please explain it to us all.

Hopefully, you are no Admiral Ackbar.

[Rinualdo]

Oh, I thought your post was sarcasm.

PB frequently states and his post allude to the theory that if you lower taxes, hiring will be increased.

I was pointing out that the Bush tax cuts applied to individuals as well as corporations. Unless someone wants to assert that lowering taxes on individuals somehow leads to an increase in hiring or the economy, its an important distinction in the should-we-keep-it discussion.

I'd be interested to hear any reasoning on why to keep the tax cuts for the wealthiest individuals.

[Clove]

You realize that there is a difference between an individual and their taxes and a corporation and their taxes I presume?I know! I know! I know! Individuals pay taxes and corporations don't?

[Parkbandit]

Unless someone wants to assert that lowering taxes on individuals somehow leads to an increase in hiring or the economy, its an important distinction in the should-we-keep it discussion.

Come on... put the pieces together.....

I'm going to throw out another hint: I own 3 "SMALL BUSINESSES" and making the Bush Tax Cuts permanent will help me afford to expand one or two of them.

And... I pay no corporate income tax.

[Tordane]

Well, in PB's defense.
From an average businesses experience:

Lower taxes usually equals more profit.
More profit usually equals a healthier company.
Healthier company usually equals growth/expansion.
Growth/expansion usually equals more jobs.

Paying for these current super long extentions of unemployment, is a tax that companies pay. The Government doesn't pay for you to be unemployed, companies that pay taxes do. Its a specific tax, unemployment tax.

It is hard to be healthy in a down economy if you can't ever recover and catch your breath. Downsizing only does so much, you still pay taxes on employee's you have to let go of via healthcare/unemployment. Things don't change overnight, in a week, in a month, and for many in years.

[Rinualdo]

You clearly don't fall into the majority of the fiscal impact.

So you are in favor of allowing the wealthiest individuals pay less taxes, then?

[Parkbandit]

You clearly don't fall into the majority of the fiscal impact.

So you are in favor of allowing the wealthiest individuals pay less taxes, then?

Who are you responding to?

[Rinualdo]

Well, in PB's defense.
From an average businesses experience:

Lower taxes usually equals more profit.
More profit usually equals a healthier company.
Healthier company usually equals growth/expansion.
Growth/expansion usually equals more jobs.

Paying for these current super long extentions of unemployment, is a tax that companies pay. The Government doesn't pay for you to be unemployed, companies that pay taxes do. Its a specific tax, unemployment tax.

It is hard to be healthy in a down economy if you can't ever recover and catch your breath. Downsizing only does so much, you still pay taxes on employee's you have to let go of via healthcare/unemployment. Things don't change overnight, in a week, in a month, and for many in years.


This is a separate point. I'm asking about individuals, not companies.

To address your direct point, however, I believe there was a post in a previous thread that talked about money respent. I think it said something to the effect of, if you lower taxes by 1$, the federal coffers will get .7x $ back in revenue from rehiring, etc. If you pay that same dollar to someone in unemployment, you get back 1.26$. The numbers aren't exact, but the overall point is that dollar for dollar, lowering corporate taxes doesn't have a net positive impact on the federal budget.

I defer to Mr. Greenspan as an expert, though not infallible, on the matter. Logic seems to dictate that if it were true that lowering taxes would help our economy and lead to an increase in jobs, then he would support it. So then I pose the following question: why is he not in favor of keeping the Bush tax cuts given the believe that it would help the economy?

[Rinualdo]

Who are you responding to?

Err, sorry, I should start quoting more.

That was an honest question to you.

I know you support lowering corporate taxes, but do you also support lowing the taxes on the individuals as it applies to the Bush tax cuts (wealthiest)?

If so, I'd like to know why. Specifically if you have a fiscal reason for doing so.

[Parkbandit]

Err, sorry, I should start quoting more.

That was an honest question to you.

I know you support lowering corporate taxes, but do you also support lowing the taxes on the individuals as it applies to the Bush tax cuts (wealthiest)?

If so, I'd like to know why. Specifically if you have a fiscal reason for doing so.

Another clue: I'm not talking about corporate taxes. I'm speaking only of individual income tax.

[Atlanteax]

Apparently Rinualdo needs to work on his reading comprehension.

[Rinualdo]

I know you support lowering corporate taxes, but do you also support lowering the taxes on the individuals as it applies to the Bush tax cuts (wealthiest)

Perhaps this will help the question for you, unless I misunderstood and you are asserting that you are among the nation's wealthiest individuals.

And you didn't answer the other question:



If so, I'd like to know why. Specifically if you have a fiscal reason for doing so.

[Atlanteax]

Revisit post #11 in this thread, by PB.

(and then re-read #12)

[Rinualdo]

Protip Atlanteax, I bolded the word "wealthiest" for a reason.

[Rinualdo]

I'll add another question if PB wishes to respond.

What is the real impact of allowing the bush cuts to expire on your net income?
Approximately how much extra do you think it will add to your bank account?

I ask because I came across this interesting article


2. Allowing the high-income tax cuts to expire would hurt small businesses.

One of the most common objections to letting the cuts expire for those in the highest tax brackets is that it would hurt small businesses. As Sen. Orrin Hatch (R-Utah) recently put it, allowing the cuts to lapse would amount to "a job-killing tax hike on small business during tough economic times."

This claim is misleading. If, as proposed, the Bush tax cuts are allowed to expire for the highest earners, the vast majority of small businesses will be unaffected. Less than 2 percent of tax returns reporting small-business income are filed by taxpayers in the top two income brackets -- individuals earning more than about $170,000 a year and families earning more than about $210,000 a year.

And just as most small businesses aren't owned by people in the top income brackets, most people in the top income brackets don't rely mainly on small-business income: According to the Tax Policy Center, such proceeds make up a majority of income for about 40 percent of households in the top income bracket and a third of households in the second-highest bracket. If the objective is to help small businesses, continuing the Bush tax cuts on high-income taxpayers isn't the way to go -- it would miss more than 98 percent of small-business owners and would primarily help people who don't make most of their money off those businesses.

From the following article: http://www.washingtonpost.com/wp-dyn/content/article/2010/07/30/AR2010073002671.html

I'm curious if PB is among the top 2% affected or if he's part of the "vast majority" the article mentioned.

[Clove]

And just as most small businesses aren't owned by people in the top income brackets, most people in the top income brackets don't rely mainly on small-business income: According to the Tax Policy Center, such proceeds make up a majority of income for about 40 percent of households in the top income bracket and a third of households in the second-highest bracket. If the objective is to help small businesses, continuing the Bush tax cuts on high-income taxpayers isn't the way to go -- it would miss more than 98 percent of small-business owners and would primarily help people who don't make most of their money off those businesses. While this data may claim that it's factually true that "most people in the top income brackets don't rely mainly on small-business income" it can't be argued that 40% is a significant segment. All you're saying here is that it doesn't address top bracket income most efficeintly; but improving the income of 40% of top bracket small business owners would certainly have a significant effect.

It seems like the argument here is, even though it could significantly help; too many people would benefit without necessarily contributing to the effect we're going for? Or in other words a variation of "most of those rich jerks don't deserve that tax break..." And to be fair it's inarguable that this wouldn't be the most efficeint way to go if your goal is to help small businesses as a class, but I'm not seeing an alternative suggestion in place of it.

[g++]

The Washington post suggests using the money to once again extend unemployment. Call me crazy but I think at this point I would rather give the money to bloated corporate fat cats than bloated lazy fucks who wont look for a job. At least the rich people are earning money. I have friends that are sitting on unemployment talking about how their training for marathons right now because they know they can....no other reason. Personally I feel like a fucking moron because when I got laid off during the ressession I bothered to get another job. Should have gone on vacation for 2 years.

[Rinualdo]

While this data may claim that it's factually true that "most people in the top income brackets don't rely mainly on small-business income" it can't be argued that 40% is a significant segment. All you're saying here is that it doesn't address top bracket income most efficeintly; but improving the income of 40% of top bracket small business owners would certainly have a significant effect.

It seems like the argument here is, even though it could significantly help; too many people would benefit without necessarily contributing to the effect we're going for? Or in other words a variation of "most of those rich jerks don't deserve that tax break..."

Perhaps I misread, but I thought the 40% was referring to the top income bracket, in otherwords 40% of the top 1%. As I read it, its also saying that those top 1% aren't small business owners to begin with.


The Washington post suggests using the money to once again extend unemployment. Call me crazy but I think at this point I would rather give the money to bloated corporate fat cats than bloated lazy fucks who wont look for a job. At least the rich people are earning money. I have friends that are sitting on unemployment talking about how their training for marathons right now because they know they can....no other reason. Personally I feel like a fucking moron because when I got laid off during the ressession I bothered to get another job. Should have gone on vacation for 2 years.

I can understand your sentiment. What you are discussing is the moral aspect. I'm keeping the discussion to the fiscal impact.

[TheEschaton]

The Washington post suggests using the money to once again extend unemployment. Call me crazy but I think at this point I would rather give the money to bloated corporate fat cats than bloated lazy fucks who wont look for a job. At least the rich people are earning money. I have friends that are sitting on unemployment talking about how their training for marathons right now because they know they can....no other reason. Personally I feel like a fucking moron because when I got laid off during the ressession I bothered to get another job. Should have gone on vacation for 2 years.

I hear anecdotal evidence counts as proof these days.

[Clove]

The Washington post suggests using the money to once again extend unemployment. Call me crazy but I think at this point I would rather give the money to bloated corporate fat cats than bloated lazy fucks who wont look for a job. At least the rich people are earning money. I have friends that are sitting on unemployment talking about how their training for marathons right now because they know they can....no other reason. Personally I feel like a fucking moron because when I got laid off during the ressession I bothered to get another job. Should have gone on vacation for 2 years.Crazy. You can't really say that because someone has been out of work for an extended time that they're lazy users. And you REALLY can't claim that because someone is rich they've done anything productive to earn it.

[Clove]

Perhaps I misread, but I thought the 40% was referring to the top income bracket, in otherwords 40% of the top 1%. As I read it, its also saying that those top 1% aren't small business owners to begin with.



I can understand your sentiment. What you are discussing is the moral aspect. I'm keeping the discussion to the fiscal impact.Nope, I'm discussing the potential effectiveness. There's no doubt that the Bush tax cuts do not impact the vast majority of small businesses.

But regardless of what fraction of the population comprises the top bracket (in this case 1%) if 40% of them primarily gain their income via small businesses, and this tax will increase their small business profit (which they can't spend by the way anyway so I don't know why anyone would morally object to that) then those businesses may expand and improve the employment situation.

To be sure, I wouldn't mind seeing a much broader tax incentive to small businesses that would stimulate their growth across all the brackets; but I don't see how this proposal could hurt. The only objections I'm seeing is "it won't do enough" or "it will benefit people who don't need it [the benefit]"

[g++]

Crazy. You can't really say that because someone has been out of work for an extended time that they're lazy users. And you REALLY can't claim that because someone is rich they've done anything productive to earn it.

Im not claiming an economic theory Im saying I am sick of them extending unemployment with tax money. It made sense during the height of the recession it doesnt anymore.

[Tordane]

Crazy. You can't really say that because someone has been out of work for an extended time that they're lazy users.

But he supplied real life examples...and I could give a list as well if that helps with the generalization?

[Tordane]

Im not claiming an economic theory Im saying I am sick of them extending unemployment with tax money. It made sense during the height of the recession it doesnt anymore.

Your right. Does unemployment still make you verify weekly that your attempting to find a new job? It sure as hell doesn't seem like it. We don't get anyone on unemployment coming to our company looking for jobs like we use to before all this recession business.

[Clove]

But he supplied real life examples...and I could give a list as well if that helps with the generalization?Not much of a sample. If I gave you real life examples of individuals on unemployment that were not lay-abouts, or (perhaps far more easily) examples of wealthy individuals who did very little work to acquire it would that overturn the generalization?

It's a poorly founded generalization based on a limited experience.

[g++]

Not much of a sample. If I gave you real life examples of individuals on unemployment that were not lay-abouts, or (perhaps far more easily) examples of wealthy individuals who did very little work to acquire it would that overturn the generalization?

It's a poorly founded generalization based on a limited experience.

It wasnt meant as an argument of persuasion it was meant as me saying fuck these stupid extensions to unemployment I would rather vote to burn the money. Its just a statement of my opinion and how I will be voting.

[Fallen]

At some point, Clove/TheE, they are going to have to cap unemployment benefits. When? 5 years? 10? That, or the government needs to start asking a hell of a lot more out of the people they are paying.

[Clove]

At some point, Clove/TheE, they are going to have to cap unemployment benefits. When? 5 years? 10? That, or the government needs to start asking a hell of a lot more out of the people they are paying.I absolutely agree, we can't pay people unemployment indefinitely; however at the same time I wouldn't call the recession over either. People are not being hired. My neighbor state Rhode Island has 12% unemployment at the moment and it really isn't because people are milking benefits.

Endless unemployment checks are little different than welfare and it can't go on forever- but killing benefits before a recovery plan is underway and bringing results isn't a solution either.


Jobless claims are up and it's the highest level of initial unemployment insurance filings in three months.

The Labor Department announced on Thursday that new unemployment claims went up by 19,000 to a seasonally adjusted 479,000 despite the fact that most analysts had expected a slight drop. According to the AP, economists worry the recovery is slowing.

Home sales and construction have slumped since the homebuyers' tax credit expired on April 30. Hiring remains weak, some companies are still cutting workers and people are still extremely conservative when it comes to spending what money they have.

Doug Roberts, chief investment strategist at Channel Capital Research told CNN, "The job market is pretty muted. It's not getting much worse, but it's not getting any better either."

Existing claims down: A false positive?

The government stated that 4,537,000 people filed continuing claims in the week ended July 24, the most recent data available. That's down 34,000 from the preceding week's 4,571,000 claims. However, what part does the expiration of claims for many people play a part in this? It is a sign that claims ran out, not a decline in the unemployed. Wall Street continues to erroneously define a decline in unemployment claims as economic improvement.

On Friday August 6, the Labor Department will issue the July jobs report. It's expected to show that across the nation there was a total net loss of 65,000 jobs, including 150,000 temporary census jobs.

Locally here in Rhode Island, the state continued to have the fourth-highest unemployment rate in the nation in June. Rhode Island’s jobless rate fell a whopping three-tenths of a percentage point to 12 percent, but the number of unemployed Rhode Islanders held at 69,300 in June, up from 62,500 a year ago.


http://www.examiner.com/x-39124-Providence-Headlines-Examiner~y2010m8d5-Jobless-claims-highest-in-three-monthsTo sum up, I understand the frustration about unemployment spending but it's really a symptom of the greater problem: no jobs. Simply stopping the benefits won't address that greater problem. When we have a solution, then it will be time to dry up the benefits.

[Rinualdo]

But he supplied real life examples...and I could give a list as well if that helps with the generalization?



The plural of anecdote is not data

[g++]

To sum up, I understand the frustration about unemployment spending but it's really a symptom of the greater problem: no jobs. Simply stopping the benefits won't address that greater problem. When we have a solution, then it will be time to dry up the benefits.

There is no solution. Its over. The global economy is pushing the middle class into the lower class. Its not only not going to get better it will likely get worse. The solution is for people who are not working to stop living like the middle class, downsize their lives and do something. Not to extend unemployment indefinately.

[Clove]

The solution is for people who are not working to stop living like the middle class, downsize their lives and do something. Not to extend unemployment indefinately.The bitch was just asking for it, dressed the way she was.

[g++]

The bitch was just asking for it, dressed the way she was.

I like how the idea that people should live within their actual means instead of taking free money for years waiting for a job that was elimininated because its economically unfeasable to magically reappear is associated with rape.

[Clove]

I like how the idea that people should live within their actual means instead of taking free money for years waiting for a job that was elimininated because its economically unfeasable to magically reappear is associated with rape.When you suggest that people without an income should just "learn to live without one" and "do something" about the economy; it may as well be like blaming a rape victim for the assault.

[Parkbandit]

I know you support lowering corporate taxes,

Come on now.. how often do I have to state that I was not talking about corporate taxes? This is the third time I've had to explain it to you.



but do you also support lowering the taxes on the individuals as it applies to the Bush tax cuts (wealthiest)

It's funny when you get upset, you start bolding stuff. I've already stated that yes, I do support keeping ALL of the Bush Tax Cuts permanent.



Perhaps this will help the question for you, unless I misunderstood and you are asserting that you are among the nation's wealthiest individuals.


No. There is a difference between the nation's wealthiest individuals and earning 250K a year. I'm the latter... which this tax rate hike will affect.



And you didn't answer the other question: If so, I'd like to know why. Specifically if you have a fiscal reason for doing so.

I would think that's pretty obvious... because I don't like paying more in taxes?

[g++]

Well I dont see it, and we both know 90% of these people could find a job that would provide them with less money than they made before the recession. They just wont do so until they can no longer collect unemployment because if you take a job while on unemployment you can actually make less money if the job is low paying enough in relation to your last job. If you geniunely cant find a job in over a year and a half file for welfare legitimately instead of calling it unemployment.

[Ryvicke]

Why do you support making the tax cuts on the nation's wealthiest (not you) permanent?

[Parkbandit]

Crazy. You can't really say that because someone has been out of work for an extended time that they're lazy users. And you REALLY can't claim that because someone is rich they've done anything productive to earn it.

I don't know.. if you've been out of work for 2 years, you sure aren't trying too hard. Sounds like lazy to me.

If I was out of work, I would do ANYTHING to not be on unemployment... mowing grass, cleaning pools, general labor, etc... There is always a job out there.. you just have to realize you aren't too good to do it.

[Clove]

I don't know.. if you've been out of work for 2 years, you sure aren't trying too hard. Sounds like lazy to me.

If I was out of work, I would do ANYTHING to not be on unemployment... mowing grass, cleaning pools, general labor, etc... There is always a job out there.. you just have to realize you aren't too good to do it.This wishful thinking brought to you by the businessman who doesn't believe he can spend his own earnings.

[Parkbandit]

Well I dont see it, and we both know 90% of these people could find a job that would provide them with less money than they made before the recession. They just wont do so until they can no longer collect unemployment because if you take a job while on unemployment you can actually make less money if the job is low paying enough in relation to your last job. If you geniunely cant find a job in over a year and a half file for welfare legitimately instead of calling it unemployment.

That's the problem with the system. Get unemployment, welfare, food stamps, HUD housing.. and kaboom.. you can't find a job that would be worth taking.

[Parkbandit]

This wishful thinking brought to you by the businessman who doesn't believe he can spend his own earnings.

It's ok kid. Get back to work for that company you 'own'.

[Parkbandit]

Why do you support making the tax cuts on the nation's wealthiest (not you) permanent?

Did you miss this post?

http://forum.gsplayers.com/showthread.php?t=54588&page=5

I thought it was pretty clear to anyone with half a brain.

[Rinualdo]

You can be snide and snarky all you want, but you've yet to even show if it would have an impact on you, let alone how much.

http://crooksandliars.com/jon-perr/10-republican-lies-about-bush-tax-cuts

Interesting chart from the tax foundation. It looks like the average family won't see an appreciable impact until they start earning over 1m a year.

If the policy is so sound, why is Alan Greenspan so against it?
http://www.huffingtonpost.com/2010/08/01/alan-greenspan-extending_n_666549.html


I read your response and I was hoping for something more then 'because it affects me personally'. I had hoped you had a sound, fiscally responsible reason for supporting tax cuts to our wealthiest 1%. Perhaps a reason why it makes good, sound monetary sense to enact a federal law that has such an impact on our coffers. You so often speak about doom and gloom from spending, how important it is to pay attention in Washington what they are doing with our money, and how bad the Democrats are. Imagine my disappointment when it appears you support such a national policy simply due to narrow self-interest.
For someone who often intimates how intelligent they are, and certainly enjoys portraying anyone who disagrees with you as some variation of an idiot, you certainly have an interesting set of criteria for what you believe national policy should be.

Oh, and still no response vis-a-vis the Alan Greenspan articles.

[Parkbandit]

You can be snide and snarky all you want, but you've yet to even show if it would have an impact on you, let alone how much.

Seriously.. now I think you are just being stupid to be stupid.

How will they impact me? MY TAX RATE WILL GO UP. Isn't that enough? It's less money in my pocket and more money in the pocket of the Government which will absolutely waste it. I'm against high taxes and I don't think I should have to work until the middle of June JUST to pay the Government.



http://crooksandliars.com/jon-perr/10-republican-lies-about-bush-tax-cuts

Interesting chart from the tax foundation. It looks like the average family won't see an appreciable impact until they start earning over 1m a year.

If the policy is so sound, why is Alan Greenspan so against it?
http://www.huffingtonpost.com/2010/08/01/alan-greenspan-extending_n_666549.html

Alan Greenspan is concerned, as am I, with the ballooning debt that we cannot afford. It has less to do with jobs and job creation and more to do with the crushing debt.

I'm saying that we keep the tax cuts in place and do what we should have done 10 years ago... CUT SPENDING.

[Parkbandit]

The Democratic majority in the U.S. House of Representatives must decide whether to write a budget extending, expiring, or repealing the Bush tax cuts. These tax cuts have provided a convenient scapegoat for the nation's budget and economic challenges. Despite a 42 percent spending increase in 2001, critics charge that the tax cuts have starved popular programs. Despite surging economic growth and 5 million new jobs since 2003, critics also charge that the tax cuts have not helped the economy. Finally, despite making the income tax code more progressive, critics charge that the tax cuts have widened inequality.

Nearly all of the conventional wisdom about the Bush tax cuts is wrong. In reality:

The tax cuts have not substantially reduced current tax revenues, which were in fact not far from the 2000 pre-tax cut baseline and over the 2003 pre-tax cut baseline in 2006;
The increased child tax credit, 10 percent tax bracket, and fix of the alternative minimum tax (AMT) reduced tax revenues much more than most of the "tax cuts for the rich";
Economic growth rates have more than doubled since the 2003 tax cuts; and
The tax cuts shifted even more of the income tax burden toward the rich.
Setting optimal tax policy requires governing with facts rather than popular mythology, which is why it is important to set the record straight by debunking 10 myths about the Bush tax cuts.

Ten Myths About the Bush Tax Cuts-and the Facts

Myth #1: Tax revenues remain low.
Fact: Tax revenues are above the historical average, even after the tax cuts.

Myth #2: The Bush tax cuts substantially reduced 2006 revenues and expanded the budget deficit.
Fact: Nearly all of the 2006 budget deficit resulted from additional spending above the baseline.

Myth #3: Supply-side economics assumes that all tax cuts immediately pay for themselves.
Fact: It assumes replenishment of some but not necessarily all lost revenues.

Myth #4: Capital gains tax cuts do not pay for themselves.
Fact: Capital gains tax revenues doubled following the 2003 tax cut.

Myth #5: The Bush tax cuts are to blame for the projected long-term budget deficits.
Fact: Projections show that entitlement costs will dwarf the projected large revenue increases.

Myth #6: Raising tax rates is the best way to raise revenue.
Fact: Tax revenues correlate with economic growth, not tax rates.

Myth #7: Reversing the upper-income tax cuts would raise substantial revenues.
Fact: The low-income tax cuts reduced revenues the most.

Myth #8: Tax cuts help the economy by "putting money in people's pockets."
Fact: Pro-growth tax cuts support incentives for productive behavior.

Myth #9: The Bush tax cuts have not helped the economy.
Fact: The economy responded strongly to the 2003 tax cuts.

Myth #10: The Bush tax cuts were tilted toward the rich.
Fact: The rich are now shouldering even more of the income tax burden.


http://www.heritage.org/Research/Reports/2007/01/Ten-Myths-About-the-Bush-Tax-Cuts

[Rinualdo]

Meh, I too can cherry pick facts and myths about the tax cuts

http://thinkprogress.org/2010/08/02/cantor-bush-tax-cuts/
http://capitalgainsandgames.com/blog/andrew-samwick/1880/five-myths-about-bush-tax-cuts-and-scourge-stimulus
http://macroadvisers.blogspot.com/2010/08/impact-of-sunset-of-tax-cuts-on-gdp.html

Do you need more?

Again, the best source on the matter I can think of is Alan Greenspan. Tell me again why he doesn't support them but the rest of the nation should?

[Clove]

And don't be so confident about those tens of thousands of lawn mowing jobs that are always out there PB:

http://www.rentaruminant.com/

Goats r serious business.

[Clove]

It's ok kid. Get back to work for that company you 'own'.Let me know if your accountant allows you to make another invalid deduction. I'll point you in the right direction.

[g++]

..how does one stumble upon a goat renting organization? Your a sick fuck Clove.

[Clove]

..how does one stumble upon a goat renting organization? Your a sick fuck Clove.My cousin owns a couple goats. My cousin owns a goat farm (and he's not even Muslim). Goats are a regular topic around here.

[Carl Spackler]

I find it hard to understand how people can't grasp, what I find to be, basic economic principles. Cutting taxes on the wealthy, who already pay the most taxes, leaves them with more money to re-invest.

I like to use Grand Rapids, MI as a perfect example of this re-investment. The city is awesome, unlike the dump capital Lansing. Grand Rapids has some very wealthy families, DeVos' (Think Amway), Van Andels (Amway), Meijer (Grocery Stores).

Millionaires many times over, some Billionaires, these people pour money back into their community to make it great. Now, imagine taking more money from them? Well not only do they have less money to re-invest in their businesses (which could potentially create jobs) they also now have less money to sink back into the community, via restoration projects, developments, charities, etc.

Their excess dollars are already put to good use, there's no need to impose more tax on them just to fund some worthless paper pusher in Washington, or new marble counter tops in the capitol building bathrooms.

[Keller]

Good point, Carl.

But let's extend it to its logical conclusion: cutting all taxes leaves everyone with more money to re-invest.

So, let's just get rid of taxes.

[Clove]

Good point, Carl.

But let's extend it to its logical conclusion: cutting all taxes leaves everyone with more money to re-invest.

So, let's just get rid of taxes.You heard it here first everyone. Keller's a Libertarian.

[ClydeR]

Myth #6: Raising tax rates is the best way to raise revenue.
Fact: Tax revenues correlate with economic growth, not tax rates.

Fact #6 is my favorite.

We also learned another fact from this thread.
Fact #11 Economic growth correlates inversely with tax rates. That is to say, cutting taxes helps the economy.

When you put that Fact #11 together with Fact #6, you see that decreasing tax rates increases economic growth, which results in higher revenues. Therefore, decreasing tax rates ultimately results in higher revenue.

If the public ever figures this out, then Republicans will win in a landslide. Because Republicans promise both tax cuts and deficit reduction. Why put yourself through the grief of doing things the hard way?

[Gan]

Good point, Carl.

But let's extend it to its logical conclusion: cutting all taxes leaves everyone with more money to re-invest.

So, let's just get rid of taxes.

Ron?

[Hulkein]

Tax and spend liberals are getting tiresome.

Nice to see a new liberal zealot in Rinualdo to take up the torch.

[Parkbandit]

Tax and spend liberals are getting tiresome.

Nice to see a new liberal zealot in Rinualdo to take up the torch.

:rofl:

"new"...

[Rinualdo]

Tax and spend liberals are getting tiresome.

Nice to see a new liberal zealot in Rinualdo to take up the torch.

I don't recall advocating spending at all.

Tax and cut spending, particularly that of the military and the two wars we're in would be more accurate.

[Parkbandit]

I don't recall advocating spending at all.

Tax and cut spending, particularly that of the military and the two wars we're in would be more accurate.

So, you would be in favor of increasing taxes to what on what segment of the population?

And would cut spending only be directed at the military? Just pull out of Iraq and Afghanistan tomorrow and whatever happens there, happens there. It's no longer our problem?

[Rinualdo]

So, you would be in favor of increasing taxes to what on what segment of the population?

And would cut spending only be directed at the military? Just pull out of Iraq and Afghanistan tomorrow and whatever happens there, happens there. It's no longer our problem?

Re: Cutting spending, certainly not. I'd certainly start with the largest expenditure of the Federal Government, which as I recall is the Military at 23% of GDP for FY '09. The next is SS, but since they are solvent, I'd keep going down the list.

And no, don't be pedantic. Of course there's no "pull out instantly" button, just as there's no "I'm President tomorrow" button. I think Obama is on the route course about pulling out in the grand strategy, though I see several mistakes on a more micro level.

As far as taxes, I'm in favor of returning the tax rate for the richest 1% back to the wealthiest 1%. I'd also remove tax breaks for the oil industry, for example.

There are certainly some domestic programs I'd look cutting as well, though I would increase spending in certain areas.

[Gan]

It was only a matter of time, but it's finally happened: The nation's Social Security system will pay out more than it takes in this year and next, as aging baby boomers begin entering retirement. The milestone marks the first time in nearly 30 years that the system is in the red, according to a report issued Thursday by federal officials overseeing the program.


http://www.dailyfinance.com/story/insurance/social-security-in-the-red-but-health-care-overhaul-may-boost-m/19582730/

[Clove]

Re: Cutting spending, certainly not. I'd certainly start with the largest expenditure of the Federal Government, which as I recall is the Military at 23% of GDP for FY '09. The next is SS, but since they are solvent, I'd keep going down the list.I don't think this word means what you think it means...

[TheEschaton]

I find it hard to understand how people can't grasp, what I find to be, basic economic principles. Cutting taxes on the wealthy, who already pay the most taxes, leaves them with more money to re-invest.

I like to use Grand Rapids, MI as a perfect example of this re-investment. The city is awesome, unlike the dump capital Lansing. Grand Rapids has some very wealthy families, DeVos' (Think Amway), Van Andels (Amway), Meijer (Grocery Stores).

Millionaires many times over, some Billionaires, these people pour money back into their community to make it great. Now, imagine taking more money from them? Well not only do they have less money to re-invest in their businesses (which could potentially create jobs) they also now have less money to sink back into the community, via restoration projects, developments, charities, etc.

Their excess dollars are already put to good use, there's no need to impose more tax on them just to fund some worthless paper pusher in Washington, or new marble counter tops in the capitol building bathrooms.

Do you know what the wealthy do when they get extra money in a recession? They save it. Even when the wealthy spend, they spend on luxury goods, which are proportionally less likely to be American, property, which has no benefit to the economy at large other than indirectly through property taxes, and luxury services, which are specialized to the point that it benefits a microcosm of a slice of certain service providers, at best. As Rinualdo pointed out, less than 2% of the top two brackets own/start small businesses to actually "trickle down" to everyone else.

The problem with trickle down economics has always been that the rich don't trickle down enough to stimulate the economy of the 95% of people under them. When you offer tax cuts to middle and lower class people, it A) is spread to many, many more people, in smaller amounts, B) a much bigger proportion is spent on actual goods and services owned by other middle and lower class people.

[Carl Spackler]

Do you know what the wealthy do when they get extra money in a recession? They save it. Even when the wealthy spend, they spend on luxury goods, which are proportionally less likely to be American, property, which has no benefit to the economy at large other than indirectly through property taxes, and luxury services, which are specialized to the point that it benefits a microcosm of a slice of certain service providers, at best. As Rinualdo pointed out, less than 2% of the top two brackets own/start small businesses to actually "trickle down" to everyone else.

The problem with trickle down economics has always been that the rich don't trickle down enough to stimulate the economy of the 95% of people under them. When you offer tax cuts to middle and lower class people, it A) is spread to many, many more people, in smaller amounts, B) a much bigger proportion is spent on actual goods and services owned by other middle and lower class people.

Incorrect. A tax cut of a couple hundred dollars to someone in the bottom tax bracket doesn't mean anything. They save that money, because they need it. Therefore that money doesn't do any good, other than to them.

Weird, you can't find a luxury item in America for a good price... Oh, thanks organized labor (This is another argument in itself.)

And yes, some goods they buy are going to be American. And you know what, some salesman get's a commission off of it, he then has more money to spend (here's your trickle down effect). So yes, trickle down economics is a very effective way to stimulate the economy.

[TheEschaton]

I'm pretty sure the widening gap between the upper and middle classes in the past 30 years since trickle down has been in fashion proves you wrong.

Plus, if you think a couple hundred dollars to people living paycheck to paycheck goes into savings, but NOT the couple thousand dollars to the already rich, I don't think you're thinking all that rationally.

[Carl Spackler]

Rational thinking says, I have expendable funds, I'm going to do something with it. Be it buy a new boat or car, go on a vacation, buy a new house. All these things are putting money back into the economy.

Even as you said previously if it's in property. That example in itself is good enough, someone is selling that property and is earning money from that. This person then can afford to do more things, so yes again, it trickles down.

Again the couple hundred dollars joe lower-middle class saves doesn't go as far is the few thousand the upper class saves (which trust me, not all get stashed in coffers). Even if they're putting some money into the market, annuities, anything... someone get's a commission, again this money is being distributed.

Again, I believe your views are incorrect.

[Daniel]

Rational thinking says, I have expendable funds, I'm going to do something with it. Be it buy a new boat or car, go on a vacation, buy a new house. All these things are putting money back into the economy.

Including potentially saving it or spending it outside of the US economy. People who don't have the ability to save currently aren't magically going to start doing it if you float them a couple of hundred of bucks a month.

It's hard to believe that in your basic economic classes you've never come across something called the "Marginal propsensity to Consume" or that you somehow completely skipped over the part where people with lower incomes typically can't/don't save which is a reason why the wealth gap increases over time.

[Tordane]

So I'm curious. Those who are reading/posting in this thread? Would you be opposed to a flat tax? Personally I would welcome it with open arms. To me, it seems the most fair of any tax plan. Lets say its 20(total)%.

Single Person - 35,000/yr - Pays 7,000
Single Person - 90,000/yr - Pays 18,000
Couple - 80,000/yr - Pays 16,000
Couple - 160,00/yr - Pays 32,000
Small Business - 800,000/yr - Pays 160,000
Small Business - 5,000,000/yr - Pays 1,000,000
Wealthy Person - 2,500,000/yr - Pays 500,000
Wealthy Couple - 4,000,000/yr - Pays 800,000

Get rid of tax brackets for everything including federal and local. Get rid of taxes on purchases. Everyone pays the same percentage. How it all gets broken up, well...thats for smarter people than I to figure out but I don't get what the problem is behind a system like this.

Yes, wealthier people pay more but the percentage is still the same as the guy making 35,000 a year. Sure, still have deductions for reasonable things. Children, major medical, incentive programs, education, expansion programs, depreciation(equipment), and so on.

Curious as to what PC folks offer as pros/cons to it.

[Carl Spackler]

It's hard to believe that in your basic economic classes you've never come across something called the "Marginal propsensity to Consume" or that you somehow completely skipped over the part where people with lower incomes typically can't/don't save which is a reason why the wealth gap increases over time.


Yes, everyone consumes. But the greatest consumers are those with the greatest capability to spend. Again, a couple hundred dollars doesn't go very far in the grand scheme of things.

Now, lets ask ourselves what killed our middled class? I turn to the unions. The unions have "over-reached" for years, and look what they've done to the auto industry. Laborers made up the middle class. You had a bunch of people with high school educations making 30-50k a year. They kept their hands holding their hands out asking for more, asking for more, well look where that got them? You want to talk about widening the gap? Instances like this have played a major role in it. Don't be blaming an economic principle that actually benefits the most people, top to bottom.

[Atlanteax]

The biggest thing against a Flat Tax (which I support) is the fairly generally consensus that the poor should have minimal taxes.

Probably the best way to implement it is a refundable tax credit that is $0 at $35k but increases to to say $5k at $20k (so individual has $25k).

This would ensure that the *working* poor get the financial help they need, while limiting abuse of refundable credit system.

[Clove]

So I'm curious. Those who are reading/posting in this thread? Would you be opposed to a flat tax? Personally I would welcome it with open arms. To me, it seems the most fair of any tax plan. Lets say its 20(total)%.I would be in favor of a flat tax, but I would much rather have a national sales tax or a VAT instead of an income tax. Tax consumption, not income.

[Tordane]

Including potentially saving it or spending it outside of the US economy. People who don't have the ability to save currently aren't magically going to start doing it if you float them a couple of hundred of bucks a month.

It's hard to believe that in your basic economic classes you've never come across something called the "Marginal propsensity to Consume" or that you somehow completely skipped over the part where people with lower incomes typically can't/don't save which is a reason why the wealth gap increases over time.

I disagree with that suggestion. Sure, folks have a propensity to consume. That doesn't mean that they can't be taught to save no matter how little they make. My wife and I certainly aren't banking and live right at/above(variable income-wife gets commission) the week to week paycheck model, but we have found ways to save.

10% of check automatically goes to 401k/IRA. - If you never had it, you won't miss it.

Auto-Draft to savings(weekly) - Weekly deposit into savings. We look at it as a bill we have to manage to pay.

Refinanced our mortgage during these low rates - Saved couple hundred a month to be rolled back into payments on interest.

Cutting coupons - I cut coupons every week. The money we save from groceries, eating out, and general shopping goes into a savings account that night when I get home. (Move money electronically to savings)

Curbed Spending - Buying things from Craigslist, shopping items we want to purchase on the internet for the best deals/reviews, talking to each other about purchases over 100, waiting 3-5 days after deciding to purchase something(be suprised how many times you change your mind).

Sure other folks out there have other ideas as well. Share them.

[pabstblueribbon]

Crazy. You can't really say that because someone has been out of work for an extended time that they're lazy users. And you REALLY can't claim that because someone is rich they've done anything productive to earn it.

Sarcasm is teh funnay.

DOUBLE ENTOUNDRE


Cause I think you are both being sarcastic. I hope.

[Clove]

I disagree with that suggestion. Sure, folks have a propensity to consume. That doesn't mean that they can't be taught to save no matter how little they make. My wife and I certainly aren't banking and live right at/above(variable income-wife gets commission) the week to week paycheck model, but we have found ways to save.It's not really a question of "can" it's a question of "will". That people CAN manage their finances more intelligently or efficeintly isn't ever in question. Even with better financial education the poor will always be less likely to save than the rich so it follows that refunding more taxes to the lower and middle classes will result in more consumer spending.

I don't disbelieve in trickle-down economics, and I'd rather see that than see unemployment benefits preemptively reduced, but I've already commented that it isn't the most efficient tax policy to address the problem. I'd rather see more tax reduction for the lower brackets (even though I don't begrudge the higher brackets any) and if I had to choose, I'd give it to the lower brackets.

[Clove]

Cause I think you are both being sarcastic. I hope.What makes you think that? You think it's generally true that only lazy people are out of work and only hard working people are wealthy? Paris Hilton anyone?

[g++]

I'd rather see that than see unemployment benefits preemptively reduced.

rofl. I guess its a matter of perspective but last I checked 6 months was normal. No one is talking about cutting it to 3. I just dont think the people who have been on it since 2009 need another 6 months to find their 150k job filing paper clips.

[TheEschaton]

Yes, everyone consumes. But the greatest consumers are those with the greatest capability to spend. Again, a couple hundred dollars doesn't go very far in the grand scheme of things.

Now, lets ask ourselves what killed our middled class? I turn to the unions. The unions have "over-reached" for years, and look what they've done to the auto industry. Laborers made up the middle class. You had a bunch of people with high school educations making 30-50k a year. They kept their hands holding their hands out asking for more, asking for more, well look where that got them? You want to talk about widening the gap? Instances like this have played a major role in it. Don't be blaming an economic principle that actually benefits the most people, top to bottom.

Unions are what keep capitalists from making the middle class the lower class. Yes, there are a few notorious examples of unions who have overstepped their bounds by demanding more benefits and less accountability, like the teacher's union (more on the accountability bit since I think teachers are paid crap even with unions), but the majority are vital to the middle class.

Again, you keep on saying "Those with the greatest amount, consume the greatest amount." Which is wrong, on a percentage basis. If the middle class outnumber the rich 50 to 1 (just made up numbers), and the rich make 2.5m to the middle's 50k, those 50 people are, proportionally, going to consume more of their 2.5m pot. Even if it's on the scale of 80% of the middle class goes to consumption of American products and services, to 50% of the upper class's consumption (which I think is a vast overestimate), you're talking a difference of 1.25m from the rich guy, to 2m from the 50 middle class folks.

[Clove]

rofl. I guess its a matter of perspective but last I checked 6 months was normal. No one is talking about cutting it to 3. I just dont think the people who have been on it since 2009 need another 6 months to find their 150k job filing paper clips.Tens of thousands of Rhode Island workers didn't just suddenly decide "hey, I like living on 60% of my income... I think I'll just lose all my work ethic and incentive to build and milk unemployment as long as possible."

[pabstblueribbon]

What makes you think that? You think it's generally true that only lazy people are out of work and only hard working people are wealthy? Paris Hilton anyone?

I would say that I think quite the opposite.

Which is why your previous post is sarcastic..

There is a weird shift, in sociology these days.

Going to college isn't guaranteeing you a job.

Being skilled, dedicated, and adaptive will.

Then again, this is just my experience, which is weird as fuck.

Oh fuck it.

[g++]

Tens of thousands of Rhode Island workers didn't just suddenly decide "hey, I like living on 60% of my income... I think I'll just lose all my work ethic and incentive to build and milk unemployment as long as possible."

What is your obsession with Rhode Island? Anyay I dont care, its been a year and a half its time to find a job that pays 50% of your last salary and feed yourself.

[pabstblueribbon]

Then again I work for railroads across the globe which defies any sense.

[Clove]

What is your obsession with Rhode Island? Anyay I dont care, its been a year and a half its time to find a job that pays 50% of your last salary and feed yourself.Because it's one of the top 4 hardest hit states for employment and (as I said initially) it's next door to me so I'm more aware of their situation.

Again, regardless of the reality of the economy your solution is "figure something out". Do you really think that if you stop allocating tax dollars to extended unemployment benefits that you won't be paying for social services for these individuals when they can't make an adequate income "mowing lawns"?

You want to stop paying unemployment, start working on a strategy to expand jobs again.

[g++]

Because it's one of the top 4 hardest hit states for employment and (as I said initially) it's next door to me so I'm more aware of their situation.

Again, regardless of the reality of the economy your solution is "figure something out". Do you really think that if you stop allocating tax dollars to extended unemployment benefits that you won't be paying for social services for these individuals when they can't make an adequate income "mowing lawns"?


"Figure something out" = get a fucking job. Yes I would rather someone get a shitty job and go on welfare than continue paying 60% of their pre-recession salary as a middle manager for the rest of my life.

[g++]

You want to stop paying unemployment, start working on a strategy to expand jobs again.

I dont understand why you think these jobs are coming back. All indications are more jobs will be eliminated.

[Clove]

"Figure something out" = get a fucking job. Yes I would rather someone get a shitty job and go on welfare than continue paying 60% of their pre-recession salary as a middle manager for the rest of my life.I know what your definition of "figure something out" is, but saying "just go get something that isn't there" isn't a solution.

[g++]

I know what your definition of "figure something out" is, but saying "just go get something that isn't there" isn't a solution.

Neither is heres a check sit on your ass till we figure out how to make the rest of the globe demand more money.

[Parkbandit]

"Figure something out" = get a fucking job. Yes I would rather someone get a shitty job and go on welfare than continue paying 60% of their pre-recession salary as a middle manager for the rest of my life.

Crazy talk... people taking responsibility for themselves.

[TheEschaton]

g++, wasn't your "get a job" just being re-hired by the company that just let you go? It's not that easy for everyone, what would you have done if they hadn't?

Oh man, I'm sorry, your situation is anecdotal, it doesn't apply.

[TheEschaton]

I happen to like the following graph. The green is the multiple of what the top earners make versus the bottom 90% of Americans, the pink is the tax rate on the wealthiest bracket.

http://i100.photobucket.com/albums/m21/alokpinto/largeextremeinequalitychart-1-1.jpg

The article itself is awesome, which I will link, but I don't expect anyone to read it/argue it.

http://seekingalpha.com/instablog/183929-sober-realist/21758-the-wealth-gap-and-the-collapse-of-the-u-s

[g++]

g++, wasn't your "get a job" just being re-hired by the company that just let you go? It's not that easy for everyone, what would you have done if they hadn't?

Oh man, I'm sorry, your situation is anecdotal, it doesn't apply.

Johns Hopkins employs like 40k people in a 600k person city. Its not like I moved my desk across the hall I had to interview with a different department and ended up in a different office at a different division doing different work on a different grant.

What would I have done? Probably gotten more money at a different job after sitting on unemployment for a few months. Its not exactly hard to find a job in the DC-Baltimore area if you can program and do IT support.

[Clove]

Crazy talk... people taking responsibility for themselves.inorite? It's not like he's asking people to spend income or anything...

[Parkbandit]

inorite? It's not like he's asking people to spend income or anything...

Seriously... it doesn't get funnier the more you use it.

And it's profit.. not income.

[Clove]

Seriously... it doesn't get funnier the more you use it.

And it's profit.. not income.Oh really? Explain the difference between an Income Statement and a Profit and Loss Statement. You don't make yourself any more "right" by repetition. But you could support yourself and prove me wrong. I'm surprised you haven't yet.

[Gan]

Get a room you two.

[Parkbandit]

Oh really? Explain the difference between an Income Statement and a Profit and Loss Statement. You don't make yourself any more "right" by repetition. But you could support yourself and prove me wrong. I'm surprised you haven't yet.

:rofl:

I think Drew put it the best:


Clove just likes to argue with PB and is the type of person who if he thinks he "gotcha" he'll bring it up like 20 times demanding you refute it.

[Clove]

:rofl:

I think Drew put it the best:Because you weren't trying to argue with me for sake of argument or pull a gotcha when you began the whole "profit" argument in the first place amirite? But really, all you have to do is prove your point.

[Keller]

Because you weren't trying to argue with me for sake of argument or pull a gotcha when you began the whole "profit" argument in the first place amirite?

I didn't see where Drew said that, though.

[Rocktar]

"Figure something out" = get a fucking job. Yes I would rather someone get a shitty job and go on welfare than continue paying 60% of their pre-recession salary as a middle manager for the rest of my life.

Or get a crappy job, learn to live within their means and don't take welfare. Sounds good, right, then you get Clove and others like him to look down on them because of it.

LOL Whut?

[crb]

Oh, I thought your post was sarcasm.

PB frequently states and his post allude to the theory that if you lower taxes, hiring will be increased.

I was pointing out that the Bush tax cuts applied to individuals as well as corporations. Unless someone wants to assert that lowering taxes on individuals somehow leads to an increase in hiring or the economy, its an important distinction in the should-we-keep-it discussion.

I'd be interested to hear any reasoning on why to keep the tax cuts for the wealthiest individuals.

Most small business owners are organized as LLCs, S-Corps, or Sole Proprietorships, which means business profits are reported under their personal 1040 under their personal marginal rate.

Only C-Corps file taxes as separate entities and are taxed at the (lower than top marginal tax rate, but higher than corp taxes around the world) rate of 25%.

So, a tax increase on "the rich" is simutaneously a tax increase for most small businesses, which are the groups that create the most jobs. If Obama is going to take $30k from your profits next year, that means you can't and won't use that $30k to hire a new worker. This would be okay if one believed that the government would more efficiently spend that $30k to result in job. But, as per the stimulus, the government needs far far far more than $30k to create a job. You'd have to be stupid to think the government can more efficiently spend money than small business owners.

Now you know, you've won half the battle! Go Joe!

[crb]

I absolutely agree, we can't pay people unemployment indefinitely; however at the same time I wouldn't call the recession over either. People are not being hired. My neighbor state Rhode Island has 12% unemployment at the moment and it really isn't because people are milking benefits.

Endless unemployment checks are little different than welfare and it can't go on forever- but killing benefits before a recovery plan is underway and bringing results isn't a solution either.

To sum up, I understand the frustration about unemployment spending but it's really a symptom of the greater problem: no jobs. Simply stopping the benefits won't address that greater problem. When we have a solution, then it will be time to dry up the benefits.

Refusing to stop ridiculous government spending and rewarding people to not look for work until the recession ends is like saying you'll stop pouring gasoline on a fire as soon as it burns out.

Even Paul Krugman, everyone's favorite liberal economist, has written this fundamental truth.

Isn't 2 years of "temporary" help long enough? If you've been unemployed that long, shouldn't you run out of benefits?

[crb]

Good point, Carl.

But let's extend it to its logical conclusion: cutting all taxes leaves everyone with more money to re-invest.

So, let's just get rid of taxes.

In an ideal world government would minimize taxes only to cover the necessities of the frugalest of their spending. National security, enforcement of the rules of law, and basic infrastructure that facilitates commerce.

They would also not tax any behavior they wish to encourage. Income taxes are a tax on productivity, they discourage productivity, they are a bad idea. Sales taxes are a tax on consumption, they encourage saving, better idea.

Just consider states. Not every state has an income tax, some states have income taxes twice as high as other states, and if you assumed 0 was 1 (because you cannot divide by 0) 10x higher than states with no tax.

If these varying different states can function without an income tax, other states should be able to as well. And if states can do it, the feds probably could too.

[Clove]

Isn't 2 years of "temporary" help long enough? If you've been unemployed that long, shouldn't you run out of benefits?I think 2 years is enough, I don't think job growth is strong enough to return benefits to 6 months, however.

[Rinualdo]

Most small business owners are organized as LLCs, S-Corps, or Sole Proprietorships, which means business profits are reported under their personal 1040 under their personal marginal rate.

Only C-Corps file taxes as separate entities and are taxed at the (lower than top marginal tax rate, but higher than corp taxes around the world) rate of 25%.

So, a tax increase on "the rich" is simutaneously a tax increase for most small businesses, which are the groups that create the most jobs. If Obama is going to take $30k from your profits next year, that means you can't and won't use that $30k to hire a new worker. This would be okay if one believed that the government would more efficiently spend that $30k to result in job. But, as per the stimulus, the government needs far far far more than $30k to create a job. You'd have to be stupid to think the government can more efficiently spend money than small business owners.

Now you know, you've won half the battle! Go Joe!

Had you read some of the linked articles, you would see that a vast majority of the people impact aren't small business owners, and the vast majority of small business owners aren't among the wealthiest 1% of the nation. A 30k swing in taxes if you compared Bush Tax v. expired tax system would easily put you in the top 1%.

The point is that for small business owners, there is no appreciable impact either fiscally or as it relates to job creation.

[Clove]

In an ideal world government would minimize taxes only to cover the necessities of the frugalest of their spending. National security, enforcement of the rules of law, and basic infrastructure that facilitates commerce.Frugal. I don't think this word means what you think it means.

[crb]

I would be in favor of a flat tax, but I would much rather have a national sales tax or a VAT instead of an income tax. Tax consumption, not income.

Not a VAT, unless you merely want to call it "the accountants job bill" it is a hidden tax, and would require far more book keeping.

A national sales tax, point of retail sale only, that would be fine.

[Clove]

Not a VAT, unless you merely want to call it "the accountants job bill" it is a hidden tax, and would require far more book keeping.

A national sales tax, point of retail sale only, that would be fine.The accounting and bookkeeping necessary to support VAT would be a fraction of what is required to support the current income tax code. It's also not a "hidden tax", it's as visible as any other. You'll have to come up with a stronger criticism.

[crb]

Frugal. I don't think this word means what you think it means.

I'm pretty sure it does.

I want my government to spend $5 for a toliet seat at walmart, not $400 for a toliet seat at "Obama's Gold Plated Toilet Seat Emporium." Or better yet, check craiglist for a freebie. I want my government to be frugal.

Maybe my sentence was phrased a little odd.

[IorakeWarhammer]

Govt. will never be frugal as long as Govt. is only accountable to other men. when that is the case, they will pull the wool over the eyes of those they are accountable to. but you cannot pull wool over the eyes of Allah. thus only leadership that fears God is qualified.

[Rinualdo]

I'm pretty sure it does.

I want my government to spend $5 for a toliet seat at walmart, not $400 for a toliet seat at "Obama's Gold Plated Toilet Seat Emporium." Or better yet, check craiglist for a freebie. I want my government to be frugal.

Maybe my sentence was phrased a little odd.

Didn't the era of the 500$ hammer originate in the military during the Reagan years?

[crb]

The accounting and bookkeeping necessary to support VAT would be a fraction of what is required to support the current income tax code. You'll have to come up with a stronger criticism.

IT would still be a hidden tax, people would pay it without realizing, and as such it would be harder to be "against." Politicians could raise it and whatnot without people really realizing it. Too sneaky.

But you couldn't replace all income taxes with a vat or sales tax, you just couldn't. The rate would be too high, it would really hurt the poorer 50% of the country who right now are almost entirely sheltered from tax paying, as such democrats would not allow it, you'd need a permanent republican supermajority to completely replace the income tax. So the record keeping and whatnot would still be there, you'd just be adding to it.

You'd maybe cut income tax rates in half, but you'd still have to do all that paperwork.

[Clove]

I'm pretty sure it does.

I want my government to spend $5 for a toliet seat at walmart, not $400 for a toliet seat at "Obama's Gold Plated Toilet Seat Emporium." Or better yet, check craiglist for a freebie. I want my government to be frugal.

Maybe my sentence was phrased a little odd.Have you looked at the military and defense budget? Are you convinced that frugality is a priority?

[crb]

Didn't the era of the 500$ hammer originate in the military during the Reagan years?

I think it is the nature of anything where you spend money that is not your own. It continues today, we spend something like 1.9 million dollars for african ant research in africa. It created 2 jobs, in africa. Cost, $950,000 per job.

[Clove]

IT would still be a hidden tax, people would pay it without realizing, and as such it would be harder to be "against." Politicians could raise it and whatnot without people really realizing it. Too sneaky.Do you by any chance know the what tax rate you paid for federal income tax? What about local property taxes? Sales tax is often by county, do you know your county's sales tax? What about the telecom tax on your phone bill? VAT is no more hidden than any other tax.


But you couldn't replace all income taxes with a vat or sales tax, you just couldn't.Now you're just being absurd. What makes you think that we can "pay enough via income tax" but not "pay enough via a sales tax or VAT". Which is heavier a pound of feathers or a pound of lead?

[Rinualdo]

I think it is the nature of anything where you spend money that is not your own. It continues today, we spend something like 1.9 million dollars for african ant research in africa. It created 2 jobs, in africa. Cost, $950,000 per job.

So then you mischaracterized Obama's Toilet Emporium and agree that any President would and has had the same things in their budget? Its a nonpartisan folly of the office?

[Keller]

Most small business owners are organized as LLCs, S-Corps, or Sole Proprietorships, which means business profits are reported under their personal 1040 under their personal marginal rate.

Only C-Corps file taxes as separate entities and are taxed at the (lower than top marginal tax rate, but higher than corp taxes around the world) rate of 25%.

Technical point - you don't "organize" as an S corporation. You incorporate as a C corporation and make an election to be treated as an S corporation.

And just because you form your business as an LLC does not mean you are not taxed as a C corporation.

What is the point of the second sentence? Just telling us all that there is a marginal rate of 25% for C corporations?

[Keller]

In an ideal world government would minimize taxes only to cover the necessities of the frugalest of their spending. National security, enforcement of the rules of law, and basic infrastructure that facilitates commerce.

They would also not tax any behavior they wish to encourage. Income taxes are a tax on productivity, they discourage productivity, they are a bad idea. Sales taxes are a tax on consumption, they encourage saving, better idea.

Just consider states. Not every state has an income tax, some states have income taxes twice as high as other states, and if you assumed 0 was 1 (because you cannot divide by 0) 10x higher than states with no tax.

If these varying different states can function without an income tax, other states should be able to as well. And if states can do it, the feds probably could too.

Sales taxes are, by their very nature, highly regressive. When you factor in the economic theory of utility, they are unbelievably regressive.

As to your point re discouraging productivity vs. discouraging consumption - that is a chicken and egg conundrum you've created. Without consumption, there is less capacity for production. So I'm not sure how you're making a bigger pie by incentivizing people to save more of their money.

[Carl Spackler]

Unions are what keep capitalists from making the middle class the lower class. Yes, there are a few notorious examples of unions who have overstepped their bounds by demanding more benefits and less accountability, like the teacher's union (more on the accountability bit since I think teachers are paid crap even with unions), but the majority are vital to the middle class.

Again, you keep on saying "Those with the greatest amount, consume the greatest amount." Which is wrong, on a percentage basis. If the middle class outnumber the rich 50 to 1 (just made up numbers), and the rich make 2.5m to the middle's 50k, those 50 people are, proportionally, going to consume more of their 2.5m pot. Even if it's on the scale of 80% of the middle class goes to consumption of American products and services, to 50% of the upper class's consumption (which I think is a vast overestimate), you're talking a difference of 1.25m from the rich guy, to 2m from the 50 middle class folks.

My wording was probably a bit confusing. Those who earn the most have the capability to be the greatest consumers. And I stand by my statements, as I am a huge believer in trickle down economics. The capability for the wealthy to reinvest in the community due to having more money is great thing, IMO.

And I agree wholeheartedly with the teachers union. I wouldn't call what they get paid completely crap. You have to take into account that they generally have the best benefits around (East Lansing, MI, teachers had [I believe still have] zero co-pay) and they only work 9 months out of the year. So a 30k a year job is actually 40k (if you consider someone working for 12 months), plus whatever benefits they get on top of that.

However, your claim that unions keep the capitalists from making them lower class is something I can't agree with. Capitalism is not a terrible thing, there needs to be incentives for people who take risks and develop a new product etc. Without capitalists and corporate america there wouldn't be any labor for the unions to do.

[crb]

Sales taxes are, by their very nature, highly regressive. When you factor in the economic theory of utility, they are unbelievably regressive.

As to your point re discouraging productivity vs. discouraging consumption - that is a chicken and egg conundrum you've created. Without consumption, there is less capacity for production. So I'm not sure how you're making a bigger pie by incentivizing people to save more of their money.


Regressive and Progressive are terms that carry their own baggage invented by liberals to identify tax policies they either favor, or not.

There is nothing regressive (dictionary definition of the word) about charging everyone the same 10% on their purchase of a knicknack regardless of their socioeconomic circumstances.

Sure, the 10% is a larger share of the poor person's wallet than the rich person's wallet. Obama likes to remind people that elections have consequences, so do poor life choices.

As for your second paragraph, yes, I concede that consumer spending also needs to be encouraged somewhat. However... saved money does not enter a vacuum. It ends up invested, which provides businesses with capital, which allows them to expand, hire more people, and be productive. It also provides individuals with a safety net so that hopefully, if they get in trouble in the future, they may not need a government bailout, so government spending will be less, so taxes can be lower... etc etc.

Afterall, if everyone saved 10% of every paycheck, we wouldn't need social security.

In anycase a tax on productivity is far worse for growth than a tax on consumption. Especially considering with our convoluted tax code in some circumstances the effective marginal rate for someone who gets a raise can approach, or even top, 100%.

[Warriorbird]

My wording was probably a bit confusing. Those who earn the most have the capability to be the greatest consumers. And I stand by my statements, as I am a huge believer in trickle down economics. The capability for the wealthy to reinvest in the community due to having more money is great thing, IMO.

And I agree wholeheartedly with the teachers union. I wouldn't call what they get paid completely crap. You have to take into account that they generally have the best benefits around (East Lansing, MI, teachers had [I believe still have] zero co-pay) and they only work 9 months out of the year. So a 30k a year job is actually 40k (if you consider someone working for 12 months), plus whatever benefits they get on top of that.

However, your claim that unions keep the capitalists from making them lower class is something I can't agree with. Capitalism is not a terrible thing, there needs to be incentives for people who take risks and develop a new product etc. Without capitalists and corporate america there wouldn't be any labor for the unions to do.

I think unions screw themselves a lot of the time. With that said, the rich don't necessarily have an incentive to spend at all. Trickle down economics actually makes it harder for the little guy to be a small businessman and get a leg up.

[Daniel]

My wording was probably a bit confusing. Those who earn the most have the capability to be the greatest consumers. And I stand by my statements, as I am a huge believer in trickle down economics. The capability for the wealthy to reinvest in the community due to having more money is great thing, IMO.



You're taking personal ability and trying to extrapolate it out to the macro level.

It doesn't matter if Bill Gates can spend more than Joe blow because there is only 1 Bill Gates and millions of Joe Blows. The policy question is if you give Bill Gates 1 million dollars or you give 10,000 Joe Blows 1 million dollars collectively, how much of that million dollars will get spent?

The reality is that the 10,000 Joe blows will spend a higher percentage because they probably need to while Bill Gates can just drop it into an offshore bank account or on a lavish weekend in Switzerland because he can.

[Daniel]

Regressive and Progressive are terms that carry their own baggage invented by liberals to identify tax policies they either favor, or not.

There is nothing regressive (dictionary definition of the word) about charging everyone the same 10% on their purchase of a knicknack regardless of their socioeconomic circumstances.

Sure, the 10% is a larger share of the poor person's wallet than the rich person's wallet. Obama likes to remind people that elections have consequences, so do poor life choices.



Buying food or paying rent is not a "poor life choice".

[Methais]

Buying food or paying rent is not a "poor life choice".

Rich people eat too. Just not Ramen.

[Daniel]

Rich people eat too. Just not Ramen.

Uh..So?

[Carl Spackler]

Uh..So?

What you're saying is that "poor people" have to spend money on food, clothing, whatever. Rich people have those same expenses, and they're possibly buying more expensive clothing, food, etc.

I understand your Bill Gates example... However you fail to mention the huge philanthropic efforts put forth by he, Warren Buffet and some of the other richest Americans. Which again brings me back to money being reinvested in communities.

[Warriorbird]

What you're saying is that "poor people" have to spend money on food, clothing, whatever. Rich people have those same expenses, and they're possibly buying more expensive clothing, food, etc.

I understand your Bill Gates example... However you fail to mention the huge philanthropic efforts put forth by he, Warren Buffet and some of the other richest Americans. Which again brings me back to money being reinvested in communities.

Neither Gates or Buffet think there is any merit to 'trickle down economics.' It's the lower end rich folks (those who are actually less likely to give back) who push it in this day and age. When it runs rampant it actually decreases the likelihood of members of the lower classes rising.

[Clove]

Sales taxes are, by their very nature, highly regressive. When you factor in the economic theory of utility, they are unbelievably regressive.Yeah they're regressive but it can't be denied that they reward saving and investing.

[Carl Spackler]

Neither Gates or Buffet think there is any merit to 'trickle down economics.' It's the lower end rich folks (those who are actually less likely to give back) who push it in this day and age. When it runs rampant it actually decreases the likelihood of members of the lower classes rising.

No where in my previous statement did I mention them trickling anything down. I stated they are philanthropic. The more money you take from the Rich gives them less of a chance to do that. I don't want their money paying for some entitlement program so a lazy asshole can collect a check while the rest of America works.... Their money is better spent elsewhere

[Warriorbird]

No where in my previous statement did I mention them trickling anything down. I stated they are philanthropic. The more money you take from the Rich gives them less of a chance to do that. I don't want their money paying for some entitlement program so a lazy asshole can collect a check while the rest of America works.... Their money is better spent elsewhere

It's double edged. Tax cuts can be great with a responsible fiscal program. We're never going to have a responsible fiscal program. State tax cuts can have especially bad effects on the economy. Sure, entitlements are stupid, but tax cuts had a big part in savaging California for example. When you freewheelingly hand out the chance to NOT PAY you risk just that happening (combined with non local expenditures).

Virginia's going through some budget shenanigans right now, partially backed by one of those thrilling trickle down measures (an 87% cut on corporate property taxes) which didn't actually attract many more corporations and drastically reduced revenues. While you may think that revenues go only to entitlements there's a lot of handy shit they go to, like roads and cops and fire crews.

[Carl Spackler]

We're never going to have a responsible fiscal program.

Isn't that the truth... Doesn't matter who is in office, the government can't get out of it's own way.

[Daniel]

No where in my previous statement did I mention them trickling anything down. I stated they are philanthropic. The more money you take from the Rich gives them less of a chance to do that. I don't want their money paying for some entitlement program so a lazy asshole can collect a check while the rest of America works.... Their money is better spent elsewhere

Because that's all the government funds?

[Methais]

Because that's all the government funds?

And that makes all the handouts ok then right?

[Daniel]

And that makes all the handouts ok then right?

That's funny. I thought we were talking about the effectiveness of tax policies, not hand outs.

[Parkbandit]

That's funny. I thought we were talking about the effectiveness of tax policies, not hand outs.

Carl: I don't want their money paying for some entitlement program so a lazy asshole can collect a check while the rest of America works.

Daniel: Because that's all the government funds?


Actually, handout programs were a pretty hefty part of this conversation... you even replied to it before.

[Daniel]

Carl: I don't want their money paying for some entitlement program so a lazy asshole can collect a check while the rest of America works.

Daniel: Because that's all the government funds?


Actually, handout programs were a pretty hefty part of this conversation... you even replied to it before.

Where was that?

[Parkbandit]

Where was that?


No where in my previous statement did I mention them trickling anything down. I stated they are philanthropic. The more money you take from the Rich gives them less of a chance to do that. I don't want their money paying for some entitlement program so a lazy asshole can collect a check while the rest of America works.... Their money is better spent elsewhere


Because that's all the government funds?

http://www.thedailybrand.com/WordPress/wp-content/uploads/2008/01/sesame.jpg

[Daniel]

http://www.thedailybrand.com/WordPress/wp-content/uploads/2008/01/sesame.jpg

Are you drunk?

[Parkbandit]

Are you drunk?

Yes.

[Rinualdo]

Even Boehner won't say the tax cuts pay for themselves.

http://rawstory.com/rs/2010/0808/boehner-refuses-tax-cuts-pay/