Defecit Hypocrisy

[Stevenson]

Like I keep saying, the Democrats are the party of fiscal, if not conservatism, then at least reasonableness:

NY Times:

"It was not long ago that Republicans succeeded in holding unemployment benefits hostage to a renewal of the high-end Bush-era income tax cuts and — as a little bonus — won deep estate tax cuts for America’s wealthiest heirs. Those cuts will add nearly $140 billion to the deficit in the near term, while doing far less to prod the economy than if the money had been spent more wisely.

That should have been evidence enough that the Republican Party’s one real priority is tax cuts — despite all the talk about deficit reduction and economic growth. But here’s some more:"

Link

I just don't see how you vote for these guys.

 

[EL PRESIDENTE]

They should let the cuts expire for all. By the dems extending them for a select the republicans fought the cuts for all. They are simply being equitable

x

 

[Stevenson]

Riiight, they were just trying to be equitable. They love fairness. That's why billionaires deserved tax cuts (that they didnt want and dont need) as much as you and I.

If you believe all they wanted was fairness, I have a bridge I would like to sell you.

 

[Denny Crane]

The estate tax is going up. I'm not sure where NYT gets its facts.

 

[andalusian]

Ah, the Bridge of Fairness. A close friend of the Imaginary Cap Space.

 

[EL PRESIDENTE]

I thought the estate tax thing was from congress not acting soon enough the year before

x

 

[BrianFromWA]

Agree on the OP's hypocrisy, but let's be real here...

"It was not long ago that Republicans succeeded in holding unemployment benefits hostage to a renewal of the high-end Bush-era income tax cuts and — as a little bonus — won deep estate tax cuts for America’s wealthiest heirs. Those cuts will add nearly $140 billion to the deficit in the near term, while doing far less to prod the economy than if the money had been spent more wisely.

Is the Bridge of Fairness a "shovel-ready" project? How's the Stimulus plan working? Sour grapes, NYT.

 

[Denny Crane]

I'm no fan of the republicans, and the lame duck congress wasn't exactly made up of people who were elected in November. I have some hope that the tea party oriented guys will stand by their campaign rhetoric and will force the republicans to bring some sanity to the spending and borrowing.

 

[EL PRESIDENTE]

BTW, I think the estate/death tax is a ludicrous concept within itself.

 

[GriLtCheeZ]

BTW, I think the estate/death tax is a ludicrous concept within itself.

Why do you hate America?

 

[EL PRESIDENTE]

Why do you hate America?

americans are uncultured bafoons!

 

[Stevenson]

americans are uncultured bafoons!

Do you mean buffoons?

 

[BLAZER PROPHET]

If we had a flat tax that was equitable to all we'd never have these threads.

 

[Denny Crane]

I've had this idea for taxation for a long time, since the 1980s at least. It basically goes like this:

A 20% flat tax on all transactions, including borrowing money.

A $4,000 per person flat tax refund. This means a family of 4 gets back $16,000.

The flat tax is regressive, sure. Poor people have to pay that tax on their meds and basic foodstuffs. But the $4K refund they get back covers a lot of the tax, if not all. In fact, many people will see a net gain in cash from the refund vs. what they pay in taxes - a negative income tax.

The refund is progressive. A person making $10K/year just got a 40% raise or 10 months rent, while a person making $1M sees the $4K as part of a mortgage payment or something.

The effect is to redistribute wealth, which the lefties seem to want. The downside is that it doesn't allow the lefties to reach out and touch people from far away by mandating behavior to get the tax break (refund).

The tax is on consumption. Rich people may hoard their money, but what good is it to have a lot of money if you don't spend it? Surely the 20% tax on a Cadillac or BMW or boat or big home or stock trade is going to get them to pay their fair share.

The 20% rate is probably too high, as it would add to the price of everything since the ore mine would be charged 20% for selling the ore to the steel mill which would be charged 20% for selling the steel to the auto makers. The right number might be in the 7% to 14% range.

The $4K would also replace a slew of social programs. Government is going to have to shrink by about 50% to be able to afford paying the refunds. Why do you need welfare programs if you're paying people this kind of cash?

 

[barfo]

I've had this idea for taxation for a long time, since the 1980s at least. It basically goes like this:

A 20% flat tax on all transactions, including borrowing money.

A $4,000 per person flat tax refund. This means a family of 4 gets back $16,000.

The flat tax is regressive, sure. Poor people have to pay that tax on their meds and basic foodstuffs. But the $4K refund they get back covers a lot of the tax, if not all. In fact, many people will see a net gain in cash from the refund vs. what they pay in taxes - a negative income tax.

The refund is progressive. A person making $10K/year just got a 40% raise or 10 months rent, while a person making $1M sees the $4K as part of a mortgage payment or something.

The effect is to redistribute wealth, which the lefties seem to want. The downside is that it doesn't allow the lefties to reach out and touch people from far away by mandating behavior to get the tax break (refund).

The tax is on consumption. Rich people may hoard their money, but what good is it to have a lot of money if you don't spend it? Surely the 20% tax on a Cadillac or BMW or boat or big home or stock trade is going to get them to pay their fair share.

The 20% rate is probably too high, as it would add to the price of everything since the ore mine would be charged 20% for selling the ore to the steel mill which would be charged 20% for selling the steel to the auto makers. The right number might be in the 7% to 14% range.

The $4K would also replace a slew of social programs. Government is going to have to shrink by about 50% to be able to afford paying the refunds. Why do you need welfare programs if you're paying people this kind of cash?

You are going to give the poor $4000 per year, and take $800 of that back in tax, and you wonder why you need welfare programs?

barfo

 

[jlprk]

The tax is on consumption. Rich people may hoard their money, but what good is it to have a lot of money if you don't spend it? Surely the 20% tax on a Cadillac or BMW or boat or big home or stock trade is going to get them to pay their fair share.

I thought the 20% is income tax. Now you say it's sales tax?

The 20% rate is probably too high, as it would add to the price of everything since the ore mine would be charged 20% for selling the ore to the steel mill which would be charged 20% for selling the steel to the auto makers. The right number might be in the 7% to 14% range.

Now it's value-added tax?

 

[Denny Crane]

What part of "20% flat tax on all transactions" implies an income tax?

 

[Eastoff]

I've had this idea for taxation for a long time, since the 1980s at least. It basically goes like this:

A 20% flat tax on all transactions, including borrowing money.

A $4,000 per person flat tax refund. This means a family of 4 gets back $16,000.

The flat tax is regressive, sure. Poor people have to pay that tax on their meds and basic foodstuffs. But the $4K refund they get back covers a lot of the tax, if not all. In fact, many people will see a net gain in cash from the refund vs. what they pay in taxes - a negative income tax.

The refund is progressive. A person making $10K/year just got a 40% raise or 10 months rent, while a person making $1M sees the $4K as part of a mortgage payment or something.

The effect is to redistribute wealth, which the lefties seem to want. The downside is that it doesn't allow the lefties to reach out and touch people from far away by mandating behavior to get the tax break (refund).

The tax is on consumption. Rich people may hoard their money, but what good is it to have a lot of money if you don't spend it? Surely the 20% tax on a Cadillac or BMW or boat or big home or stock trade is going to get them to pay their fair share.

The 20% rate is probably too high, as it would add to the price of everything since the ore mine would be charged 20% for selling the ore to the steel mill which would be charged 20% for selling the steel to the auto makers. The right number might be in the 7% to 14% range.

The $4K would also replace a slew of social programs. Government is going to have to shrink by about 50% to be able to afford paying the refunds. Why do you need welfare programs if you're paying people this kind of cash?

I do not like encouraging population growth with tax incentives.

 

[Denny Crane]

How does it encourage population growth? Having a kid is a lot more effort than $4K is worth.

 

[jlprk]

What part of "20% flat tax on all transactions" implies an income tax?

"Flat tax" is usually used to mean income tax, but upon inspection of your wording, I now see that you were using it for value-added tax. Does this proposed VAT replace income tax or supplement it? If the latter, Republicans and most Democrats would call it a tax increase (though the $4000 exemption might make it revenue-neutral).

 

[Denny Crane]

"Flat tax" is usually used to mean income tax, but upon inspection of your wording, I now see that you were using it for value-added tax. Does this proposed VAT replace income tax or supplement it? If the latter, Republicans and most Democrats would call it a tax increase (though the $4000 exemption might make it revenue-neutral).

By flat, I mean there's not 10% on some transactions, 15% on others, 20% on the rest.

And yeah, it's a VAT that would replace income tax.

The theory behind it is that if the purpose of taxation is to redistribute wealth, then do it as directly as possible and without any strings attached.

 

[MARIS61]

The estate tax is going up. I'm not sure where NYT gets its facts.

Wherever they get them, they have been phenomenally accurate for decades.

 

[jlprk]

The theory behind it is that if the purpose of taxation is to redistribute wealth, then do it as directly as possible and without any strings attached.

That's like saying, if the purpose of a hospital stay is to distribute medical care, then give everyone the same medicine regardless of their diagnosis. Obviously, you can't redistribute anything without paying attention to who's getting how much of it.

In your plan, a family of 4 spends 80,000 in one year, owes 20% of that = 16,000 tax, but gets 4 x 4000 = 16,000 credit, and pays nothing.

x = income
f = family members
to owe any tax, .2x > 4000f
rearranged equation is x/f > 20,000

Tax will be owed if income per family member > $20,000. Families under $20,000 will see a tax decrease. Families just over that will see a tax increase.

Wealthy families way over that will supposedly see a tax decrease. But they currently really pay way under 20%, despite their supposed tax bracket, due to deductions, write-offs, credits, and exemptions. Republican campaign contributors would not allow those to be eliminated. Analysis would have to be done to see who pays more and who less.

 

[MARIS61]

I have some hope that the tea party oriented guys will stand by their campaign rhetoric and will force the republicans to bring some sanity to the spending and borrowing.

Putting your life in the hands of a bunch of inbred racist hicks seems downright suicidal to me.

 

[MARIS61]

The refund is progressive. A person making $10K/year just got a 40% raise or 10 months rent, while a person making $1M sees the $4K as part of a mortgage payment or something.

The effect is to redistribute wealth, which the lefties seem to want. The downside is that it doesn't allow the lefties to reach out and touch people from far away by mandating behavior to get the tax break (refund).

The tax is on consumption. Rich people may hoard their money, but what good is it to have a lot of money if you don't spend it? Surely the 20% tax on a Cadillac or BMW or boat or big home or stock trade is going to get them to pay their fair share.

Surely not.

Take Paul Allen for instance.

A tax on what he spends (and we know he likes to spend) would be a nano-fraction of a what a tax on his yearly income would be.

It would redistribute more wealth to the wealthy, and pretty much crush what's left of the lingering middle-class.

 

[Denny Crane]

Surely not.

Take Paul Allen for instance.

A tax on what he spends (and we know he likes to spend) would be a nano-fraction of a what a tax on his yearly income would be.

It would redistribute more wealth to the wealthy, and pretty much crush what's left of the lingering middle-class.

How does he get his income? Every stock sale would be taxed, every dollar he borrows against his assets would be taxed. Buying the Blazers, he'd have paid 20% tax on that, too.

 

[Denny Crane]

That's like saying, if the purpose of a hospital stay is to distribute medical care, then give everyone the same medicine regardless of their diagnosis. Obviously, you can't redistribute anything without paying attention to who's getting how much of it.

In your plan, a family of 4 spends 80,000 in one year, owes 20% of that = 16,000 tax, but gets 4 x 4000 = 16,000 credit, and pays nothing.

x = income
f = family members
to owe any tax, .2x > 4000f
rearranged equation is x/f > 20,000

Tax will be owed if income per family member > $20,000. Families under $20,000 will see a tax decrease. Families just over that will see a tax increase.

Wealthy families way over that will supposedly see a tax decrease. But they currently really pay way under 20%, despite their supposed tax bracket, due to deductions, write-offs, credits, and exemptions. Republican campaign contributors would not allow those to be eliminated. Analysis would have to be done to see who pays more and who less.

Currently a family of 10 with one wage earner making $106K pays 15% in FICA alone.

The way I'm looking at it, the government spends $3.9T (Obama's latest budget proposal) for 310M people, or $12,580 per person.

Refund $4K or even $6K of that $12,580, and there's still plenty for government to spend.

Realistically, the government should be spending no more than $9K per person if it doesn't want to be borrowing $1.5T every year.

 

[barfo]

How does he get his income? Every stock sale would be taxed, every dollar he borrows against his assets would be taxed. Buying the Blazers, he'd have paid 20% tax on that, too.

Well, that would certainly have some interesting outcomes. For example, the stock markets would take a huge hit. All the hedge funds would go belly up. No one would buy stocks except those planning to hold them for a very long time.

And taxing loans at 20% would pretty much kill what's left of the housing market and most business expansion projects.

Other than the economic consequences, I think your plan has a lot of merit.

barfo

 

[Denny Crane]

Well, that would certainly have some interesting outcomes. For example, the stock markets would take a huge hit. All the hedge funds would go belly up. No one would buy stocks except those planning to hold them for a very long time.

And taxing loans at 20% would pretty much kill what's left of the housing market and most business expansion projects.

Other than the economic consequences, I think your plan has a lot of merit.

barfo

When buying a house, it's a matter of what you can afford as payments. The down payment is after tax income. The principal you pay off is after tax income, too. It's not going to hurt a thing.

The stock market is little more than legalized gambling as it is set up. Buying and holding stocks for a very long time is what the stock market is supposed to be.

Doesn't it bother you that Exxon makes $billions in earnings and pays $0 in taxes?

 

[barfo]

When buying a house, it's a matter of what you can afford as payments. The down payment is after tax income. The principal you pay off is after tax income, too. It's not going to hurt a thing.

Ok, let's say I want to buy a house. Price of the house is $1 million. If I'm a typical homebuyer, I scrape together 20% for a downpayment and pay the rest over time. Now I have to scrape together 20% downpayment and 20% tax. Doubling the upfront cost isn't going to depress sales? I find that rather difficult to believe.

Plus there is now a huge disincentive to move from house to house, as it costs 20% each time - and you don't get that back when you sell. Just as with the stock market, you have to wait until prices go up by 20% just so you can break even. Maybe your answer to that is the same - people should buy a house and stay there instead of moving around?

The stock market is little more than legalized gambling as it is set up. Buying and holding stocks for a very long time is what the stock market is supposed to be.

I don't necessarily disagree with that sentiment, but "supposed to be" according to who?

Doesn't it bother you that Exxon makes $billions in earnings and pays $0 in taxes?

Sure. But there are lots of ways to address that. Some of them are better than others. I'd be inclined to start by removing whatever loopholes they are using to avoid paying tax.

barfo