Republicons and Taxes

[stebo0728]

Great so your suggestion is to flip the financial tables. One group of people pays little, and gets what amounts to a great benefit, relatively speaking. Then another group pays an exorbitant amount into the system, only to collect that same mundane, relatively speaking, benefit in the future. Great plan, redistribute much? Spread the wealth much?

The uber successful should be paying more
If not them then who?

http://economix.blogs.nytimes.com/2011/ ... f=business

Telcoman

WOW that was wonderful, I'm glad you finally stated it that way. The uber successful. Normally its the uber wealthy, but are you finally realized that wealth = success. Then you aren't far from realizing success = hard work. You're getting there.

^ Took a page out of R/T's book there

My point before was that someone paying 100% of their income above $106k is NOT going to one day receive a retirement income from SS on the magnitude of having a lifetime income above $106k. I understand inflation may warrant an increase in the $106k cap to say maybe $150k I dunno, but removing the cap period? So a self employed person making 500k a year, at 15% full FICA demand he has to pay $75k a year in FICA? Thats absurd.

Now how about someone making 500k employed at a business. So now he catches a bit of a break, he only has to pay $37.5k per year in FICA, but now his employer ALSO has to pay $37.5k per year? You want to talk about companies making some serious hiring decisions? If they're looking at hiring someone and having to pay 7.5% for 100% of what they pay the person, that might just very well suppress some job creation.

[Encryptshun]

In this day and age, success is not as much a measure of hard work as it used to be. We have an increasingly growing population of "idle rich". Also, we have a growing number of what I call "Atom-Smashers" -- capitalists and executives who will choose the short-term profit over long-term sustainability, reaping the huge wave of financial benefit and then letting everyone else (including investors) twist in the wind. So when I hear people talk about how "when you raise taxes on the rich, you're punishing productivity" it rings pretty hollow with me.

I have said before and I will say again that I'm not in favor of a punitive tax code. However, there are ways to reform the code so that it is unfavorable towards those who hoard wealth and whose means of profit are detrimental to the U.S. economy. That doesn't target a class of people, it targets a school of behavior.

[szh]

Great so your suggestion is to flip the financial tables. One group of people pays little, and gets what amounts to a great benefit, relatively speaking. Then another group pays an exorbitant amount into the system, only to collect that same mundane, relatively speaking, benefit in the future. Great plan, redistribute much? Spread the wealth much?

The uber successful should be paying more
If not them then who?

http://economix.blogs.nytimes.com/2011/ ... f=business

Telcoman

Even if you assume the premises mentioned in the article, it still will not result in a balanced budget or reduce the growth in the debt. If the 1986 tax rates existed today, you only get $168 billion (assuming, as the article mentions too, that other things to change that did not change) contribution towards the annual budget.

Let me show you why ... using the numbers mentioned in this article.

If this extra tax revenue had been collected for the entire period from 1986 to 2008, it still would only reduce the total debt by $1.7 trillion.

Leaving it nearly $12 trillion dollars in the hole ... way too high ... and still growing.

If the Feds had taken 100% of the income from the rich for ALL those years, that $1.7 trillion would be about $5 trillion ... still leaving us about $7 trillion dollars in total debt.

And, this year, if the Feds did the same thing, and all the income from the rich were taken, that $168 billion would be about $500 billion ... still leaving us way deep in the deficit hole for the year!

As others have mentioned too, without cutting spending too, there is no way we can even come close to balancing the budget, or even eliminate the growth in the debt ... even by "taxing the rich" to oblivion!

Amazing what clarity is there in numbers ... rather than rhetoric!

Z

[stebo0728]

Even if you assume the premises mentioned in the article, it still will not result in a balanced budget or reduce the growth in the debt. If the 1986 tax rates existed today, you only get $168 billion (assuming, as the article mentions too, that other things to change that did not change) contribution towards the annual budget.

Let me show you why ... using the numbers mentioned in this article.

If this extra tax revenue had been collected for the entire period from 1986 to 2008, it still would only reduce the total debt by $1.7 trillion.

Leaving it nearly $12 trillion dollars in the hole ... way too high ... and still growing.

If the Feds had taken 100% of the income from the rich for ALL those years, that $1.7 trillion would be about $5 trillion ... still leaving us about $7 trillion dollars in total debt.

And, this year, if the Feds did the same thing, and all the income from the rich were taken, that $168 billion would be about $500 billion ... still leaving us way deep in the deficit hole for the year!

As others have mentioned too, without cutting spending too, there is no way we can even come close to balancing the budget, or even eliminate the growth in the debt ... even by "taxing the rich" to oblivion!

Amazing what clarity is there in numbers ... rather than rhetoric!

Z

Let me save you some headache Z, I've shown them that math 8 thousand times the last 3 months. They dont get it.

[szh]

Let me save you some headache Z, I've shown them that math 8 thousand times the last 3 months. They dont get it.

I guess so!

FWIW, I had asked this earlier in the thread:

Curiosity question since I don't know the answer: The article says from one source that $120 billion would be the "cost", if the reduction continues for another year ... what is the cost for the lowered amount that the other tax reduction "for the wealthy" caused?

I found my answer in the link that Telco provided.

Z

[Encryptshun]

Admittedly I haven't gone back and read every post on the subject, but I don't remember anyone saying that if we do nothing other than raise taxes on the rich it will close the budget gap.

Of course we need to reduce spending. Even Isaac, who said "we should pay for what programs we want" didn't argue that point.

But before cutting social security and medicare for people who have not been fortunate enough to avoid relying on them, before enacting policy that ensures that people will not retire from the workforce and make way for the next set of job-seekers, before cutting medicare benefits without enacting legislation aimed at controlling spiraling health-care costs, we need to explore the potential of alternate revenue as a way to keep critical entitlements in place while cutting those that are not critical. I would argue that we need to encourage those who can retire to do so, let those unemployed step in to fill those jobs, and pour money into infrastructure projects designed to put Americans to work and stimulate private industry (which is currently starving for venture capital). If the wealthy 1% (some of whom would end up getting this money right back again) are asked to step up and help us pay for those programs, then I am not embarassed to ask them.

[AZhitman]

Even when I was playing on the conservative side of the court, I couldn't figure out why Republican and Libertarian candidates promised or even promoted half the things they talked about.

Agreed as well.

[szh]

Admittedly I haven't gone back and read every post on the subject, but I don't remember anyone saying that if we do nothing other than raise taxes on the rich it will close the budget gap.

My point is that we should not get all hot and bothered about the "rich not paying their taxes" - there have been threads like this in the past (Search for "fair share" to see an example of what I mean)!

To a lesser degree, my other point would be that we should explore all ways to raise revenue (close loopholes, remove tax breaks, etc.) and cut spending (no "leave my entitlements alone" ... so I disagree with some of your other comments in the post above).

Of course we need to reduce spending. Even Isaac, who said "we should pay for what programs we want" didn't argue that point.

Oh, good! We are in better agreement here then.

If the wealthy 1% (some of whom would end up getting this money right back again) are asked to step up and help us pay for those programs, then I am not embarassed to ask them.

The problem is that taxes are not "asked for" by the Federal government or the IRS ... they are "demanded"!

And, as long as we do not demonize the rich - as has been suggested in threads here - I am less reactive.

Z

[Encryptshun]

Our boys weren't really "asked" to serve their country in WWII or Vietman either, but that's still what we called it. Let those who would not want to pay more either refuse to pay or speak with their votes just like everyone else.

*edit -- and I don't "demonize" the rich either. But I do view non-productive rich people to be just as much (if not more) of a drain on our economy as non-productive poor people.

[szh]

BTW, I was not suggesting that you are demonizing the rich - which is why I used "we" rather than "you" in my post.

But that does seem to be the theme of the "tax the rich" mantra in general, no?

Z

[Encryptshun]

Oh, I didn't think you meant me. I just feel the need to set myself apart from certain stereotypes.

With regard to the mantra, I don't think it's the voice of the moderate majority. Just like the "cut off the unemployed" mantra on the conservative side, the voice of the radical fringe seems to get the most airplay.

[szh]

Our boys weren't really "asked" to serve their country in WWII or Vietman either, but that's still what we called it.

In Vietnam certainly, they were "drafted" - no choice in the matter ... not "asked", no?

Maybe it is semantics, but to me "asked" implies the ability to refuse! And that is certainly not possible with taxes and the draft.

Let those who would not want to pay more either refuse to pay or speak with their votes just like everyone else.

Okay ... but isn't that the reason for the existence of the Tea Party and their supporters ... ? Do you agree with their purpose for existence then?

But I do view non-productive rich people to be just as much (if not more) of a drain on our economy as non-productive poor people.

Hmmm ... why do you say that?

From my perspective, non-productive rich don't get some portion of my (and yours) tax money doled out to them (I am not at all suggesting that the poor should be allowed to starve, just saying that I don't see how the non-productive rich can be a drain on the economy ... or affect me in any way that makes it "if not more", as you said).

Z

[szh]

Oh, I didn't think you meant me. I just feel the need to set myself apart from certain stereotypes.

No problem!

With regard to the mantra, I don't think it's the voice of the moderate majority. Just like the "cut off the unemployed" mantra on the conservative side, the voice of the radical fringe seems to get the most airplay.

Good point.

Z

[AppleBonker]

From my perspective, non-productive rich don't get some portion of my (and yours) tax money doled out to them (I am not at all suggesting that the poor should be allowed to starve, just saying that I don't see how the non-productive rich can be a drain on the economy ... or affect me in any way that makes it "if not more", as you said).

Because they have greater potential/ability to do something. One rich guy has far more ability to help the economy than one poor guy. Just a thought.

Other than that, I'm just here soaking up information. Thanks guys!

[Encryptshun]

Drafting was the technical term but in politicized speech it was being "asked to serve your country". Only people that didn't volunteer were drafted.

I'm not sure what the Tea Party seeks to do or what its purpose is. If you asked several average Tea Party rally participants, I bet they wouldn't be able to give you once consistent answer either (just like if you asked 100 people "why are you a Democrat?"). The Tea Party has a right to exist just like any group does under freedom of assembly. I don't agree with 99.9% of what I hear come out of their mouths, but that doesn't mean they don't have a right to take an active role in their government. I just dislike how some of them go about achieving their ends.

Regarding the non-productive rich, I'm not sure I follow your correlation between taxation and the economy, but I'll try to take a stab at it. Especially if you believe in the viability of trickle-down economics (yeah, I know that's not the PC term for it), you should agree that any money not flowing back into the economy hurts the economy. Poor people spend all of what they have, so they contribute 100% back to the economy, even if they are subsisting on public money in the first place. If you are rich and you invest your capital in a way that you are the only true beneficiary, then you are a parasite.

[AZhitman]

Really?

...even if they employ a housekeeper, travel a lot, buy expensive clothes, pay a gardener and pool maintenance company, take their 5 cars in for service at a dealer, go out to eat a few times a week, take the dogs to a groomer, get a car wash each week, pay more for vehicle registrations, buy new electronics, and donate their no-longer-needed stuff to charities?

The super-poor do a lot of things themselves, because they can't afford to pay someone to maintain their house / car / yard / pets / etc. They also don't buy as many nonessentials.

The 5% of their income the rich might contribute could easily equal (in dollars) the 100% contributions of 10 poor families.

Not arguing, just gently debunking.

[Encryptshun]

No need to treat me with kid gloves, Greg. I can take my lumps. And I love to argue. But I draw the line at mudwrestling.

You are right in that example, of course. But an increase in taxes for that person isn't going to affect that standard of living. It would only affect income generated from that portion of his or her money that is lying fallow anyway. So it wouldn't matter if taxes went up and it still doesn't help the economy aside from that small direct impact.

And quite a few of us who aren't super-poor still do things ourselves, mostly because we're really picky and enjoy being self-sufficient.

[szh]

Drafting was the technical term but in politicized speech it was being "asked to serve your country". Only people that didn't volunteer were drafted.

Like I said, it is terminology and semantics perhaps. The end result was "no choice but to serve in Vietnam" regardless.

I'm not sure what the Tea Party seeks to do or what its purpose is. If you asked several average Tea Party rally participants, I bet they wouldn't be able to give you once consistent answer either (just like if you asked 100 people "why are you a Democrat?"). The Tea Party has a right to exist just like any group does under freedom of assembly. I don't agree with 99.9% of what I hear come out of their mouths, but that doesn't mean they don't have a right to take an active role in their government. I just dislike how some of them go about achieving their ends.

I was pulling your leg mostly!

I don't agree with most of their extreme positions either, but I cannot take away their right to have them!

Hell, I detest the existence of the US Nazi Party, but, in a democracy, they have a right to hold a parade if they want to!

Regarding the non-productive rich, I'm not sure I follow your correlation between taxation and the economy, but I'll try to take a stab at it. Especially if you believe in the viability of trickle-down economics (yeah, I know that's not the PC term for it), you should agree that any money not flowing back into the economy hurts the economy. Poor people spend all of what they have, so they contribute 100% back to the economy, even if they are subsisting on public money in the first place.

Hmmm ... the problem is that I don't see the thought, I guess, that I inferred from your earlier post. Maybe I misunderstand what you are getting at.

Specifically, your "non-productive rich people are a drain on the economy more than poor people" comment that I was responding to.

My point was that if a rich person is non-productive, they aren't a drain to anybody else - let alone the economy. No connection. I suppose they could fit your parasite model - in the extreme case - but that is still not a drain per se.

But, if a poor person is non-productive, it does affect others in a direct way - since we will not allow them to starve, of course, they must receive money to survive.

The money must come from other places (your taxes and mine? Charity?), so this is a drain on the economy in a direct way, since my/your taxes are higher, and charitable people have less to spend, and I/you don't get to spend that extra funds ... to aid the economy (and the tax revenues of the government, too, by the way).

If you are rich and you invest your capital in a way that you are the only true beneficiary, then you are a parasite.

But ... but ... why?

Isn't it their money to do with as they wish? Where is it writ large that rich people must spend to benefit others? They can help others if they want to but it should be their choice! OTOH, what we make rich people and others to "contribute" does happen: it is called "taxes"!

Regardless of which, I doubt that the rich only benefit themselves with their spending ... so, maybe, just maybe, the point is moot.

Z

[IBCoupe]

Isn't it their money to do with as they wish? Where is it writ large that rich people must spend to benefit others?

It certainly is their money, and it's not written anywhere that they can't use it to benefit only themselves.

Doesn't mean they're not parasites.

[Encryptshun]

Z, I'll say one last clarifying thing on the topic -- I think we are treading here through the fundamental argument against trickle-down economics: nothing in the system requires the money to trickle down. So we are giving definite economic advantage to a segment of the population with no guaranteed return. (And yes, the same can be said for giving tax breaks to poor people, no argument there either, but poor people are a smaller risk than rich people because they have comparitively little money in the first place.)

You are absolutely right that it's their money to do with as they wish. And I absolutely agree that they don't only benefit themselves. I still say, however, that the economic benefits are coindidental and not causal. If a rich person elects to invest his money in futures (oil, gold, corn) for example, his investment hurts the overall economy while extending benefit to only two entities -- himself and one relatively small segment of the market. It doesn't create jobs. Much of it goes overseas, so it doesn't necessarily even hit anyones pocket in the U.S. Yet he still gets a huge boon from it. If he invests in the stock market, all that happens (right now, anyway) is that, if he's an activist shareholder, he gets to vote his shares. Otherwise not even the company he bought shares of sees any benefit (since right now it's hard for companies to borrow even if their stock price goes up a bit). Might as well say that buying concert tickets from a scalper benefits the band.

So, to try to bring it all back around, when I hear someone on Capitol Hill say "Raising taxes on the wealthy will kill jobs" I have a hard time swallowing that, because unless those rich people are out starting companies or investing hard-core venture capital, directly infusing startups with seed money, are the jobs they create really the sort of jobs that support our long-term national strategy? I don't see it. Employing maids and car washers and cooks and personal shoppers or buying luxury cars/boats/houses (the former two that aren't even probably made in the U.S.) doesn't help our economy grow in any strategic, meaningful way. But it certainly helps to further increase the ever-widening gap between the wealthiest 1% and the remaining 99% of Americans. Is that what we want? To ultimately see the wealth be controlled by a select few individuals and the rest of us fighting for scraps from their table? I think that's going to happen eventually regardless. But IMHO rewarding the behavior is just going to make it happen faster.

[AZhitman]

And quite a few of us who aren't super-poor still do things ourselves, mostly because we're really picky and enjoy being self-sufficient.

Yes we are.

Plus, I hate paying someone 5x what I think a job is worth if I can figure it out myself. But, I'm learning (slowly) that my time has a ever-increasing price tag.

[Encryptshun]

AbsoLUTEly, Greg.

I have a short list of things that I don't trust myself to do:

Haircuts
Electrical work (other than basic light/fan fixture installation)
Plumbing
Replacement of windows/siding/roof/AC/Furnace
Complex auto repair or bodywork on my DD

Next spring I plan to tear out my deck and replace with a paver patio and completely level and resod my back yard. I will do all the demo work, but then have someone do the rest for me. I also have stopped changing my own oil as there's a shop down the street that does a great job and I want to support his business.

[szh]

Plus, I hate paying someone 5x what I think a job is worth if I can figure it out myself. But, I'm learning (slowly) that my time has a ever-increasing price tag.

Yes! Even for simple things that are not expensive charges either.

Can I do an oil change myself? Sure! But, when a local guy is willing to put my car up on his lift and do the change for me for $15 (my oil and my filter) under my supervision, it is totally worth it for me.

Z