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Hello:
They SAY that if the Bush tax cuts are extended to the richest people amongst us, they'll create jobs. They certainly might. I don't know. But, we don't have to guess. Instead of just giving them a tax break and HOPE they'll do the right thing, why don't we give them a tax break WHEN they create the jobs?
I'd go for that. You? Remember when we gave the banks money and HOPED they start lending? We got snookered on that one.. Let's not do it again.
excon
Yes we foolishly "gave them money" . But in this case it's not giving the rich money.. . it's not picking their pockets for more .
Not only am I in favor of extending the current tax rates for all taxpayers ;I also am in favor of a massive reduction in the Cap Gains Taxes. Do that and you would really see the economy heat up and unemployment drop.
As JFK once said ,there comes a time when these Keynesian incentives that have been tried prove ineffective . That time came and went early in this downturn. It is debatable if TARP effectively prevented collapse. It is not debatable that the bucket list spending was a complete waste of taxpayer's money.
Yes JFK clearly told the country that
American Rhetoric: John F. Kennedy - Address to the Economic Club of New YorkQuote:
In the past, this could be done in part by the increased use of credit and monetary tools, but our balance of payments situation today places limits on our use of those tools for expansion. It could also be done by increasing federal expenditures more rapidly than necessary, but such a course would soon demoralize both the government and our economy. If government is to retain the confidence of the people, it must not spend more than can be justified on grounds of national need or spent with maximum efficiency.
Read the rest... he makes a compelling case for across the board 'supply side ' cuts in taxes.
These people (companies?) who make $250K+ a year possess 86% of the American wealth and are not middle class. What have they done during the past five years to create jobs? Corporate profits and productivity have climbed, as has the unemployment rate.Quote:
Originally Posted by tomder55
These people making $250,000 are your restaurant owners ,grocery store ,hardware store... Main Street businesses . Great idea penalize them right at the time the economy could be crawling into recovery .
Please show me one credible economists who says you can "tax your way out of recession" . The President himself says that tax increases in a recession are counterintuitive. That is why he is changing his language on this issue . He now talks in terms of not allowing the "tax cuts on the rich " to become permanent . He KNOWS it's a bad idea to increase taxes now.
Business owners around the country are looking a huge hits at the bottom line as it is because of their obligations under the foolishness called Obamacare...
Do you know that these places of business with a handful of employees will have to complete and submit to the IRS a 1099 form for every petty cash purchase over $600 (Section 9006 of the health care bill )? Businesses will now have to issue millions of new tax documents every year.
Brilliant!! Your laundrymat owner will have to retain an office clerk for the purpose of purchasing soap for the business!
It was the rich that paid by far the largest share of the tax bill in the last decade . I know that is an inconvenient truth but it is the truth . Under the "Bush Tax Cuts " .The richest 1.3 million tax-filers -- those Americans with adjusted gross incomes of more than $365,000 in 2005 -- paid more income tax than all of the 66 million American tax filers below the median in income. Ten times more.
Taxes and Income - WSJ.com
In 1980, when the top income tax rate was 70%, the richest 1% paid only 19% of all income taxes; now, with a top rate of 35%, they pay more than double that share.
You want a recovery ? Then don't penalize the businesses that will make it happen.
Hello again, tom:Quote:
Originally Posted by tomder55
Cool. Let them make it happen FIRST, then they don't get penalized.
excon
Hmm... lets not extend the tax cuts to the middle class or poor unless they spend the money first.
Yeah that's the ticket .
We know tax increases (which is what letting the current tax code expire amt's to) is bad for an economy in a recession. I am in favor of negotiating a new tax structure and I think it could be done in a bipartisan fashion .
So ;extend the current tax code until a new one can be agreed upon.
Businesses are already planning next years activities without knowing what their tax liabilites will be . I submit that is bad for business and bad for the American economy. A lame duck session is too late to make fundamental changes.
Hello again, tom:Quote:
Originally Posted by tomder55
Nobody - that would be absolutely NOBODY thinks the middle class are the job creators. That, so they say, is the job of the wealthy. Plus, nobody thinks the tax breaks for the wealthy will pay for themselves either.. You DO know that the HOLE Bush blew into the Clinton surplus happened BECAUSE of the Bush tax cuts... And, the jobs STILL traveled overseas... How do you reconcile that?
Out of one side of your mouth you talk about spending money we DON'T have and burdening our grandchildren with the debt, and out of the other you want to add $700 BILLION to it, in the HOPES it creates jobs... How do you reconcile that?
Me? I'm not so sure... My solution... Create jobs FIRST, and then get rewarded... Wassa matter with that? You DO notice that I'm not AGAINST these tax cuts... I'm just for earning 'em.
excon
Hello again, tom:Quote:
Originally Posted by tomder55
While we're at it, it's time to debunk that crap too... The new key word the right has glommed onto is "uncertainty" - and then they hammer us to death with it.. Kind of like death panel... It ain't true, but it works..
If you think businessmen wait till they have CERTAINTY in the marketplace BEFORE they invest, you're dreaming... As you should know, there hasn't been certainty in the marketplace for 75 or more years - yet business found a way to invest... As I've said before to you, businessmen don't look to see what politicians are doing before they invest. They look at the market. They look at DEMAND for their product.. Nobody hires people because they think the tax rate is better. They hire people because DEMAND for their product is up. It's the ONLY reason they hire.
Clearly, if businessmen WAITED till politicians ACT, we'd have been in the toilet a long time ago. As a right wing type person, I'da figured you'd know that.
excon
The middle class are the consumers. They are the driving force in the economy. Right now they are afraid of what's to come. They are holding dollars and spending more wisely. Also paying off high interest credit cards and consumer loans. They aren't really buying anything until they know what's ahead.Quote:
Originally Posted by excon
As far as tax credits for jobs created. I would be against it. Once you create that scheme then the government will tell you who you should hire and we are back at square one. If you want a tax credit for hiring then Id meet you half way. Give a tax break dollar for dollar on education for the purpose of job training. Nobody seems to be doing that any more and skilled labor is waning fast. We need skilled labor force and its those jobs that can affect the economy. Before when unions were strong they built the skilled labor force. Now since unions had gotten greedy their influence have gone to the wayside. And no one has picked up the ball and ran with the education platform. Many jobs out there today expect experience. The problem comes when there are no experienced labor out there. Jobs are changing constantly and an educated labor force is needed with the skills of the latest technology. Its up to business to provide that.
The Obots wasted more than that in a year spreading asphalt on paved roads .
But I am not Adding $700 Billion to the debt by seeking status quo. To let the tax bill expires amts to a massive increase in taxes at exactly the wrong time.
Every time supply side taxe cuts have been tried they increase the revenues into the Federal coffers and stimulate growth . So I have a proven solution that works as opposed to tax increases that historically slow down the economy .
How would your system work ? Would a boss have to get an employee , set that employee ,start paying all the various obligations that a part and partial with the payroll system first... then perhaps take the time and expense to train the employee... would there be a minimum time of employment before the employer is entitled to the tax break ? Then what ? Will the employer now have to petition the government for reimbursement from taxes already paid or will this employer be subject to the increased taxes until the next quarter ? Year ? Lets say this employer hires in good faith and then because of demand or other business realities has to let a percent of their employees go ? Will the employer then have to return the tax break to the government ?
How many new IRS employees would be needed to handle these constant adjustments ? As it is the IRS is going to be underemployed because they will need to process all those additional 1099's their offices will be flooded with.
My own view is the tax system is already way to incenticed with exceptions and breaks ,and conditions . The best tax system for both business and individual would be a system that elimated the complexity in the current code that is nothing more than a create work for accountants charade.
Corporate tax rates are too high bottom line... Business in this country pay higher rates than any of our world competitors save Japan.
And taxing a business person making $250,000 ,and calling that person rich is one of the biggest jokes that has come out of this administration. At least a millionaires tax should not kick in until that person actually is a millionaire.
Hello again, tom:Quote:
Originally Posted by tomder55
I don't know HOW the details would work out. I just know it COULD work, and I see in your answer, a basis to make it work.
I agree with the above... But, without hiring people directly, that's the ONLY way government has to "create jobs".
excon
I've addressed that before too. My comments stand . Leading business people in the country have all said the same thing ;that regime uncertainty is one of the biggest reasons they aren't moving on the investment front. It is also a major reason why consumers will be sitting on the sidelines and curtailing their spending this season.Quote:
Originally Posted by excon
Are you saying business aren't concerned at all with potentially huge increases in costs? (taxes ,new spending related to Obamacare and FinReg) .Even Obama buttboy Jeffery Immelt has said he just wished he knew what the rules were.
I listen to what business owners are saying... you not so much
Hello again, tom:Quote:
Originally Posted by tomder55
I AM a business owner. Nuff said.
excon
I have watched your debate with interest and you have the psychology of the tax cuts all wrong. If you reduce tax on the lower income earners you create demand because these people don't keep the money, they spend it. So how come your politicians don't know this and do what they need to do, reduce tax on lower incomes. It has already been said here that these people pay less tax anyway than the high income earners, so you are not giving away much but the psychological effect is to boost both spending and expectation.
I am cynical enough to think that in your system reducing tax on low income earners isn't popular because there are no votes in it.
Wrong most low earners already pay no Federal taxes.
Nearly half of US households escape fed income tax - Yahoo! Finance
The truth is that apx.only half the population contribute to the Federal coffers.
I think you have the idea of low earners wrong, I'm speaking of those below the threshold of the tax cuts who may not actually be on the bread line. If your system doesn't actually tax half of the income earners, and I doubt that is the correct intrepretation of the statistics, then perhaps it needs a serious overhaul.Quote:
Originally Posted by tomder55
What is the point of having a system which doesn't achieve what it sets out to do and that is to have income earners contribute to the maintenance of the nation. You object to the nanny state but you have a worse nanny state than any of us, refunding tax credits.
Yes our system is in serious need of overhaul... I mentioned just one of them related to deductions . It's the correct interpretation all right. The vast majority of the tax revenues collected by the Federal Government is collected from the people everyone claims is screwing them .
But as you know ,the income tax is not the only form of pocket picking our various authorities have devised. The Federal Government still gets their share from the poor in the separate contributions the lower income earners are forced to contribute to the 'entitlement ' system. I'm not naiive enough to believe that these contributions are going towards retirements since the Feds steal this money and add it to the general revenue.
They also pay a larger percentage of their incomes to local taxing authorities for sales tax than the higher income earners.
They are subject to local income and property taxes.
And of course these corporate taxes everyone loves so much get passed onto them in the transfer to the costs of products.
Hi TomQuote:
Originally Posted by tomder55
It's a shame that you haven't separated the concept of contribution from the concept of entitlements. We all know taxation is theft and no more so that the flat rate tax implicit in such taxes as fuel excise and sales tax. We have long minimised but not totally eliminated local taxing authorities because we so often see their efforts as regressive. It is not difficult to eliminate collection of tax from low income earners so that the burden of lodging returns is eliminated, you just set the threshold higher in recognition of the outcomes. Please don't invent any new taxes as we have idiots here who think such things have to be tried.
It was sold to the country as that ,but when Social Security was challenged in court ,the Roosevelt cabal quickly changed their story and said the collection was a tax. This is the same bait and switch the Obots are using on ObamaCare.Quote:
It's a shame that you haven't separated the concept of contribution from the concept of entitlements
The politicians here still talk about there being a Social Security "Trust Fund" ,and perhaps on paper there is...
However ,their borrowing against it to support their spending makes it for all practical purposes non existent .
Same here... there is serious talk of VAT being implemented . They also have their eyes on peoples personal retirement funds ,as 401K accounts represent one of the few untapped sources for their theft.Quote:
Please don't invent any new taxes as we have idiots here who think such things have to be tried.
There is one way to make an instant solution to the economy that no one seems to be talking about. Sure some will have to sacrifice but in the long run it will set the compass of the economy on fire again. Since they moved gasoline to the comodities market it is being held hostage ever since. If they let it go back to private hands as it was before gas would be around .80 cents per gallon. And since this economy runs on fuel it would represent a major windfall for the consumer. If you touch it its more then likely been delivered by a big rig somewhere along the line. For that matter you could even drop it back to where the market would hold it at and set a $1.00 per gallon tax and start paying off the national debt and we would all still be ahead of the game.
On a personal note I also suppot abolishing the tax codes and the IRS and would like to see the fair tax happen. That too would free up a lot of dollars being wasted on hiding the money and shell games.
Hello again, dad:Quote:
Originally Posted by califdadof3
That looks to me like a tax on the middle class. I'd rather soak, I mean tax the rich... That's not a mistake... The superrich have gotten spectacularly richer over the last four decades while their fellow citizens either treaded water or lost ground. The top 1 percent of American earners took in 23.5% of the nation's pretax income in 2007 — up from less than 9% in 1976. It's time they paid their fair share.
Plus, if these lower rates are supposed to encourage the superrich to create jobs, they've HAD these rates for the last 10 years, and we LOST jobs. What's up with that?
excon
Yes the term Social Security must have entered our language about the same time it did yours along with income tax. When it was implemented we were told that when our population reached 20 million there would be no need for income tax, now it's true tax has been greatly reduced from the heady days of 95% but the Social Security contribution has long since being merged and now we have entitlements, but rather than giving discounts against a rate what we do is manipulate the thresholds so that our top rate has remained much the same for a long time but you have to have an above average income to pay it.Quote:
Originally Posted by tomder55
VAT or GST has proven to be one of the better ideas where it is traded off for a lot of inefficient taxes like sales taxes and stamp duties, it certainly traps those who are able to manipulate their declared income or the cash economy. The trap lies in the level of documentation, as you are finding out with the Obama health care legislation but if you keep small business out of it, and work with gross figures not transactions it can work well. As to retirement we have taken a liberal view and reduced taxes associated with such contributions to promote the idea of people not being dependent on government in the long term. What this means is the individual retains control so long as the funds are quarantened and has a favourable tax regime but withdrawal has a penelty componentQuote:
Same here... there is serious talk of VAT being implemented . They also have their eyes on peoples personal retirement funds ,as 401K accounts represent one of the few untapped sources for their theft.
Its because they found something better then tax breaks. Its called outsourcing. The cheap labor overseas is what is driving the jobs from here. We can't compete with 10 cents an hour.Quote:
Originally Posted by excon
Hello again, dad:Quote:
Originally Posted by califdadof3
Then extending the Bush tax cuts for the wealthy is nothing more than a gift for the people who need it the LEAST, that you and I, and our children will be paying for, for a long time to come. I don't like it one bit.
The tax cuts for the wealthy were passed, if you recall, because there was a period of prosperity, and a huge surplus.. It made sense to give some back... Now, the surplus has been replaced with a deficit, and we're in a slump. It makes sense for the rich to give some back.
excon
Come on, ex, none of it makes any sense, when those cuts were made it was made obvious that it was temporary, just like prosperity, now they want tax cuts without prosperity. All this has proved is that you should never cut taxes. Where I come from we understand the process better, the idea is to cut the maximum fleece with a minimum of bleetingQuote:
Originally Posted by excon
The tax cuts came in the wake of the Clinton recession . It led to a quick recovery and a period of strong growth. There is no such thing as a permanent tax rate as you know so calling them 'temporary' is a political game. What is being proposed here is a tax increase. And as I've pointed out already... I can't think of any economist who thinks tax increases is a good idea in a recession.
You see Tom there's the rub, if they had been permanent look at all the debate that would have been avoided and you could have had a different debate, something about paying the piper, so let's see now; you had a recession under Clinton and a depression under Obama and a war fueled period of growth in between and you do think some sort of fiscal measure isn't needed because your economy is over stimulated to the point of inflation.Quote:
Originally Posted by tomder55
Taxation is the only tool you have left, all the others have been stripped away, the alternative might be cutting jobs in the public sector
I think the Bush tax cuts for the wealthy should be allowed to expire, they will just make the debt worse without benefiting the economy. I would cut taxes for the middle-class and introduce a national sales tax similar to the goods and services tax in Canada. It was very unpopular but it got Canada out of debt. Americans need to get over their sense of entitlement about not paying their fair share of taxes. If Canadians and Europeans can pay, so can Americans. Unfortunately, American politicians don't seem to have the will to do things that are necessary but unpopular.
Yes the GST is a good idea and it is a growth tax so the better the economy the greater the revenue, we found when we implemented it here that the potential revenue was vastly underestimated, pointing to a cash economy that was much bigger than estimated. The negative impacts were also vastly overestimated as it allowed general tax cuts to be made and a fairer tax regime to be implemented. Look at our economy today, we don't talk about recession, but how to control inflation. The truly wealthy have an ability to use loop holes to reduce tax anyway so the lower the tax rate the less incentive to do so. People need to realise the debate is wrongly oriented, tax is not 100% and you need income to pay tax, so concentrate on generating income, tax doesn't drive the businessQuote:
Originally Posted by earl237
Huh ? You know why there is a risk of inflation. Our Fed and Treasury have been lousy managers of our monitary policy;letting the dollar steadily decline ;and now with QE2 ,potentially pushing the dollar over the cliff. I took some satisfaction watching the President getting lectured by the likes of Hu Jintao (the phony hypocrite) and Angela Merkel at the G20 meeting last week.Quote:
and you do think some sort of fiscal measure isn't needed because your economy is over stimulated to the point of inflation.
It was comical having our
President being the only world leader thinking that pumping money into the economy would fuel a recovery .He and Bernanke got the wrong ideas about the way FDR handled the 1930s depression.
The truth is that his policies turned it into a decade long event . Obama and Bernanke are hell bent on repeating the mistakes .
Now that I think of it... what Roosevelt did is what is being proposed by various posters on this thred.
Amity Shlaes - Obama threatens to follow in FDR's economic misstepsQuote:
Roosevelt, too, pursued the dual purposes of revenue and social good. In 1935 he signed legislation known as the "soak the rich" law. FDR, more radical than Obama in his class hostility, spoke explicitly of the need for "very high taxes." Roosevelt's tax trap was the undistributed-profits tax, which hit businesses that chose not to disgorge their cash as dividends or wages. The idea was to goad companies into action.
The outcome was not what the New Dealers envisioned. Horrified by what they perceived as an existential threat, businesses stopped buying equipment and postponed expansion. They hired lawyers to find ways around the undistributed-profits tax. In May 1938, after months of unemployment rates in the high teens, the Democratic Congress cut back the detested tax. That bill became law without the president's signature
Read the rest... there are interesting quotes by prominent business people of today and the 1930s about regime uncertainty also .
History shows that tax increases never stimulate an economy... nor does excessive pump priming with borrowed or printed currency.
Yeah yeah I get it... it feels good to "soak the rich" because people think they are responsible for the economic situation today. Me ,I blame it part on the natural business cycle and a large part on government policies that were enacted to "command" the housing market towards a specific goal.
Tom you don't get it, for the rich tax rates aren't what it is about because they have discovered tax havens so raising a tax rate just collects the unprepared.Quote:
Originally Posted by tomder55
The housing market is just one aspect of economic activity. You can't expect to have a housing market led recovery when the market is oversupplied with cheap houses. What you need is a method of preventing foreclosures so that the pool of cheap housing doesn't grow. That might be a legislated moritorium on foreclosures or the government acquiring all those mortgages before forced foreclosure. There is a basic problem, with housing prices low the mortgages are more than the property value. If you had a system where the borrower could not walk away, you might be able to get more emphasis on restructuring. Here's a thought for you, why doesn't your government invite migrants to buy up the cheap housing with government loans. I'm sure you know migration feeds economic growth and with a fresh pool of cheap labour you could bring some of your industries back from overseas.
Yes, you had some foolish policies which came from social engineering, but politicians will always back a dream. When a government implements social policy it should come with guarantees, an insurer of the last resort.
Here is what they should've done with the stimulus funds...
Buy up toxic assets like foreclosed homes ;hire construction crews to bull doze them to get the excess inventory off the market .
I think in most cases bubbles are caused by government command manipulations .
Nope, they are caused by personal greed, the impression that someone can make a quick buck or have the opportunity to get an asset that makes them appear wealthy - case in point the dot-com boom (see irrational exuberance)Quote:
Originally Posted by tomder55
I would argue that the Clintoon's and Greenspan's attempt to keep interest rates artificially low caused the dot come bubble. It burst when the Fed made a series of adjustments and raised rates.
Then you don't understand technology and business. Interest rates had nothing to do with the dot com boom.
Like you said, unadulterated greed. Someone on another site (grammarmudge.cityslide.com) said: "The guys who wrote the sub-prime mortgages were sleazy, but not illegal (in most cases - some exceptions). The real bad actors were the investment bankers who securitized the bad paper, and then paid the ratings agencies to give them the highest AAA ratings, knowing full well they were garbage, and then selling the worthless stuff to pension funds, municipalities and others.Quote:
Originally Posted by NeedKarma
Putting the blame on Congress is a right wing talking point to divert from the truth.
Were the regulators sloppy? Yes. Did Congress push too hard to promote home ownership? Yes. Did Congress issue fraudulent ratings for toxic bonds? NO. Did Congress pay millions for these ratings? NO. Did Congress gain BILLIONS OF DOLLARS by selling this known garbage to unsuspecting victims? NO!
The core problem is NOT Congress - it is the FRAUD perpetrated by Wall Street investment banks and Wall Street ratings agencies. It's really as simple as that."
Over 1999 and early 2000, the Fed increased interest rates six times. That was seen as a correction for the fact that there was too much money looking for a home. The Dot com collapse happened in March 2000 . It is not greed... capital is always looking for the best investment... What ? You mean you wouldn't change banks for a point or two difference in a CD ?
After the collapse the Fed went right back to an easy money policy ,and again the die was cast... Money looking for investment ,and Government policies encouraging that the money go into the real estate market because administrations for the last 20 years bragged about the increase in home ownership in the country .
Not the cause. Read more here: Dot-com bubble - Wikipedia, the free encyclopediaQuote:
Originally Posted by tomder55
I know you believe that the government has to control everything but I believe in personal responsibility. People excited by this new emerging technology bought in without doing their due diligence i.e. checking the business plan of the companies they invested in. Yes some people made money (I made a little) because they got out knowing that it was unsustainable.
Quite the opposite... command economy is a socialist dogma.Quote:
I know you believe that the government has to control everything
By extension the people who bought homes were irresponsible investors too. I thought the mimi was that they were duped suckers.Quote:
People excited by this new emerging technology bought in without doing their due diligence i.e. checking the business plan of the companies they invested in. Yes some people made money (I made a little) because they got out knowing that it was unsustainable
Everything you've written as causes relate to the government, never once did you mention a person's choices in the market.Quote:
Originally Posted by tomder55
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