Bill Kristol tells GOP to come back to the table.

Greg wrote:

But, no. Letting the temporary tax rates expire is not raising taxes in my book. Passing the Democratic proposal would be raising taxes in my book.

What, exactly, do you think is the Democratic proposal?

I ask because I think what you think are the Democrats raising taxes is actually just the expiration of a sh*tload of temporary tax cuts. The Bush era tax cuts, the estate tax cuts, and the payroll tax cuts were all designed to be temporary. It just so happens that they're all going away next month.

The only actual tax increases kicking in next year are for Obamacare and, unless you make more than $250,000 or make most of your income from investments, they aren't going to affect you. Not that that even matters since those taxes aren't part of any Democratic proposal.

Greg wrote:

I thought that the democratic proposal included 1.6T in tax increases on the 'wealthy', and $400 billion in cuts over the same 10 years. I thought that the $400 billion cut in Medicaid had to do with the ACA implementation, not the fiscal cliff resolution. I am confused.

Yeah, it is confusing...

The $1.6 trillion isn't a tax increase. What's happening is that the Bush era tax cuts are expiring at the end of December. Those tax cuts reduced the rate that everyone paid in income tax. Obama has proposed to extend those tax cuts for anyone making less than $250,000 and let them expire for anyone making more than $250,000. The result will be that people making over $250,000 will pay the pre-Bush tax rate of 39.6% instead of the post-cut 35%.

Technically, Obama is proposing to cut taxes for 98% of taxpayers since, by law, the Bush era tax cuts are going away.

The $400 billion in cuts to Medicaid are cuts. You might be thinking of the $700 billion and change that is coming from Medicare. Except those really aren't cuts, per say. They are a reduction in payment to service providers and savings generated by efficiencies and reduced fraud.

Greg wrote:

Is this criticism really fair when the republicans have put limiting deductions on the table which would increase the effective tax rate without raising marginal rates?

There is simply no way that the country can pay down its debt by only cutting spending. There has to be additional tax revenues.

The problem is that Norquist's pledge doesn't allow for any change to the tax code that increases the amount of tax revenue generated. If the revenue goes up then he deems it to be a tax increase.

Either way, I simply don't trust the Republicans to touch the tax code. Given their history and their ideology, the primary result of their "reforms" would most likely be a dramatic reduction in taxes for the wealthy and corporations.

Greg wrote:

Agreed. I like the solution of raising the retirement age for social security and medicare. It seems fair and I will need the extra 2 years - retirement age pushed to 69 years old to save enough money to retire anyhow. I think that 75 is the new 65.

You can also do things like means test and eliminate the cap on the Social Security tax. Right now people only pay into the SS fund on the first $105,000 they make.

OG_slinger wrote:

What, exactly, do you think is the Democratic proposal?

I ask because I think what you think are the Democrats raising taxes is actually just the expiration of a sh*tload of temporary tax cuts. The Bush era tax cuts, the estate tax cuts, and the payroll tax cuts were all designed to be temporary. It just so happens that they're all going away next month.

Agreed. The increases in revenue are the planned expiration of the Bush and Obama (payroll tax) temporary tax cuts.

The above is quite distinct and separate from the Democratic proposal put forth by the Treasury Secretary on Thursday which is to raise 1.6T in taxes over the next 10 years. $400 Billion in unspecified spending cuts over the next 10 years. Spending 150 Billion in stimulus over the next 3 years with the first $50 billion to be spent in 2013. Delaying sequestration for 12 months. I view passing the Democratic Proposal as a tax hike because it is not a passive action, it will require new legislation to implement.

My personal position is that we need more revenue and we need to cut spending across the board, no sacred cows. Two thirds of what I want is scheduled to happen January 1st. Only entitlement reform will not automatically happen.

Greg, what exactly is wrong with a tax hike after 20 straight years of cuts? And one that only raises the top rate by 10% (3.6% max, 36% to 39.6%)? In budgets, any budgets, can you make the budget work by *never* increasing income commensurate with customer growth (at least)?

What is your base stance on taxes, anyway? We're back in the early 60's, tax-wise. How low do you want to go? Even Laffer notes that each incremental change after reducing taxes has *less* effect than the ones done with higher taxes; isn't it obvious that we've hit the point where cutting taxes is not helping us improve the economy, after thirty years of it?

Government spending under Obama has *dropped*, and the economy still has issues. We've cut taxes continuously, with one exception, since 1982, and the economy has crashed several times since then. Rather than flourishing, we've seen that the theory that these tax cuts is based on does not work when it's the only driving factor for fiscal policy (the Republicans spend like drunken sailors when they get control, nullifying any possible gains from tax cuts according to Laffer's thinking.) In fact, last year, not only were there no tax increases as the President asked for (modest though they were), but spending cuts were the only means used to try to cut the deficit. And look how that worked out. That was the President giving in to Republican orthodoxy. That's not compromise; what you see this week, that's the *start* of compromise. The Republicans must slaughter *their* sacred cow, too, or we're going over the cliff and the President wins anyway.

It's like we're at the point now where half the population believes that government fiscal policy should never include *income*. It's bizarre. Taxes are tools, just like spending cuts and spending itself, and to remove one tool from the box under the guise that it's somehow overused (when in fact it's at the lowest level in 50 years or so) is irresponsible.

The problem with raising the retirement age on Social Security is it's based on the idea that we're living longer now. Fine, but the increase in life isn't across the board. The poorest people have had hardly any increase in average life expectancy at all, meaning that an increase in the retirement age for Social Security will have them working until they drop dead.

Here's an article about this point: http://www.washingtonpost.com/blogs/...

Also lost in this overall conversation is the fact that there are different kinds of spending and not all spending is either bad or contributes to the economy in a meaningful way.

When you spend (even deficit spend) to build a Hoover Dam, Interstate Highway System, or improve education standards, the result of that spending has a multiplying effect on the growth of the economy. Likewise, when you spend on programs that reduce poverty and increase economic mobility, you drastically reduce the amount of money you will need to spend keeping people in prison.

On the other hand, if you put yourself into a deficit hole by purchasing Maginot Line projects like the F-22 fighter or cutting taxes on upper income brackets who are mostly just socking it away in T-bills now, the effect of those deficit increasing measures has a far smaller multiplier.

What we need more than anything else is an honest accounting of how we arrive at the deficit and a sober analysis of productive and unproductive economic measures. Do we need another aircraft carrier just because it "creates jobs" when those jobs and resources would be more appropriately allocated fixing the $1 trillion worth of infrastructure repairs the American Society of Civil Engineers estimates we need in this country?

It is all fine and good that people have their "sacred cows", but much of what folks characterize as "sacred" isn't beef at all, but pork. And now is the time for Americans to recognize it.

Ok, I can accept repealing tax cuts for the one percent IF we also consider raising rates on everyone else. Since the Bush tax cuts were supposed to be temporary, why are they only going away for some people? You can talk about "only a couple percentage points" but those percentage points equal tens if not hundreds of thousands of dollars. Meanwhile, the overall hit to a middle class family would "only" be a couple thousand. Painful sure but probably not devastating. If I need to skip a vacation or two, go out to eat less, or only buy games on Steam sales to ensure my kid doesn't grow up to face a Grecian style meltdown, I'll take that bargain.

I'm not saying we let those middle class cuts happen all at once - we can raise rates slowly over several years.

jdzappa wrote:

Ok, I can accept repealing tax cuts for the one percent IF we also consider raising rates on everyone else. Since the Bush tax cuts were supposed to be temporary, why are they only going away for some people? You can talk about "only a couple percentage points" but those percentage points equal tens if not hundreds of thousands of dollars. Meanwhile, the overall hit to a middle class family would "only" be a couple thousand. Painful sure but probably not devastating. If I need to skip a vacation or two, go out to eat less, or only buy games on Steam sales to ensure my kid doesn't grow up to face a Grecian style meltdown, I'll take that bargain.

I'm not saying we let those middle class cuts happen all at once - we can raise rates slowly over several years.

Austerity doesn't work.

Yes theoretically thats 'fair' but kicking a economy while its down doesn't get it going much faster.

Like its been said 1000's times over in these threads already the 'job creators' are a myth so its time they pay a reasonable income tax instead of padding their Swiss accounts.

Higher taxes for the middle class? you just said it right in your own post. Less consumer spending which this economy doesn't need.

Robear wrote:

Greg, what exactly is wrong with a tax hike after 20 straight years of cuts? And one that only raises the top rate by 10% (3.6% max, 36% to 39.6%)? In budgets, any budgets, can you make the budget work by *never* increasing income commensurate with customer growth (at least)?

Robear, I am sorry that I am not making myself clear.

My strong preference is to let the Bush tax cuts and Obama payroll tax cut expire as scheduled. We need both increased revenue and decreased spending. Everyone's taxes should go up.

In my opinion, the current democratic proposal does not go far enough in raising revenues or cutting spending. Bring back Clinton era taxes with no more gimmicky sun setting.

jowner wrote:
jdzappa wrote:

Ok, I can accept repealing tax cuts for the one percent IF we also consider raising rates on everyone else. Since the Bush tax cuts were supposed to be temporary, why are they only going away for some people? You can talk about "only a couple percentage points" but those percentage points equal tens if not hundreds of thousands of dollars. Meanwhile, the overall hit to a middle class family would "only" be a couple thousand. Painful sure but probably not devastating. If I need to skip a vacation or two, go out to eat less, or only buy games on Steam sales to ensure my kid doesn't grow up to face a Grecian style meltdown, I'll take that bargain.

I'm not saying we let those middle class cuts happen all at once - we can raise rates slowly over several years.

Austerity doesn't work.

Yes theoretically thats 'fair' but kicking a economy while its down doesn't get it going much faster.

Like its been said 1000's times over in these threads already the 'job creators' are a myth so its time they pay a reasonable income tax instead of padding their Swiss accounts.

Higher taxes for the middle class? you just said it right in your own post. Less consumer spending which this economy doesn't need.

Like I said, roll them in over several years so we don't sink the economy. But this idea that the rich can solve all of our problems is pure fantasy. Even if we taxed them at 100 percent it wouldnt fix the deficit. Additionally, the ultrarich can just leave the country or hire an army of accountants and lawyers to make sure they don't really pay those higher rates.

Here are several other reasons why I think America needs to accept higher taxes on everyone except the desperately poor:

1. We're at war - everybody should be contributing to that effort. I'd be happy if we just raised rates across the board to cover current campaign expenses in Iraq and Afghanistan.
2. Nobody was feeling financially crippled during the Clinton years - why would returning to those rates cripple us now?
3. Social welfare states are expensive and the average German, Dutch or Swedish middle class family pays much higher taxes than their American equivalent. If we have a mandate to pay for more healthcare, expanded unemployment, free college, etc, somebody needs to pay for it.

jdzappa wrote:
jowner wrote:
jdzappa wrote:

Ok, I can accept repealing tax cuts for the one percent IF we also consider raising rates on everyone else. Since the Bush tax cuts were supposed to be temporary, why are they only going away for some people? You can talk about "only a couple percentage points" but those percentage points equal tens if not hundreds of thousands of dollars. Meanwhile, the overall hit to a middle class family would "only" be a couple thousand. Painful sure but probably not devastating. If I need to skip a vacation or two, go out to eat less, or only buy games on Steam sales to ensure my kid doesn't grow up to face a Grecian style meltdown, I'll take that bargain.

I'm not saying we let those middle class cuts happen all at once - we can raise rates slowly over several years.

Austerity doesn't work.

Yes theoretically thats 'fair' but kicking a economy while its down doesn't get it going much faster.

Like its been said 1000's times over in these threads already the 'job creators' are a myth so its time they pay a reasonable income tax instead of padding their Swiss accounts.

Higher taxes for the middle class? you just said it right in your own post. Less consumer spending which this economy doesn't need.

Like I said, roll them in over several years so we don't sink the economy. But this idea that the rich can solve all of our problems is pure fantasy. Even if we taxed them at 100 percent it wouldnt fix the deficit. Additionally, the ultrarich can just leave the country or hire an army of accountants and lawyers to make sure they don't really pay those higher rates.

Here are several other reasons why I think America needs to accept higher taxes on everyone except the desperately poor:

1. We're at war - everybody should be contributing to that effort. I'd be happy if we just raised rates across the board to cover current campaign expenses in Iraq and Afghanistan.
2. Nobody was feeling financially crippled during the Clinton years - why would returning to those rates cripple us now?
3. Social welfare states are expensive and the average German, Dutch or Swedish middle class family pays much higher taxes than their American equivalent. If we have a mandate to pay for more healthcare, expanded unemployment, free college, etc, somebody needs to pay for it.

See Cheese's response for some good points.

I agree somewhat on the overall. Even taxes for the middle class of Americans is fairly low comparative to the rest of the world.

This is a long term question America has to come to terms with. You want social programs? they require taxes so start paying at a closer rate the rest of the first world does.

Thing is this is not a good time to start asking the middle class to stump up the cash. Get the economy fixed and people employed again and you can come back to that question.

as for 1-3
1. I think thats why Obama is trying to wind down the wars? It would of made sense to tax people higher in the good times when those wars were going on not now in bad times compounding the economic situation.

2. Unemployment. People had jobs in Clinton era. Employ everyone at Clintons levels again and you can come back and start talking about middleclass taxes.

3. Kinda talked about this higher up. America has a no tax but yes please social services culture. They need to decide what they actually want. Funny part is the democrats seem to be aware of the simple math and want to get to some acceptable medium ground. The Republican approach still seems to be magical math of cut taxes.... booming economy don't worry about all the middle parts!!!!!

jowner wrote:
jdzappa wrote:

Ok, I can accept repealing tax cuts for the one percent IF we also consider raising rates on everyone else. Since the Bush tax cuts were supposed to be temporary, why are they only going away for some people? You can talk about "only a couple percentage points" but those percentage points equal tens if not hundreds of thousands of dollars. Meanwhile, the overall hit to a middle class family would "only" be a couple thousand. Painful sure but probably not devastating. If I need to skip a vacation or two, go out to eat less, or only buy games on Steam sales to ensure my kid doesn't grow up to face a Grecian style meltdown, I'll take that bargain.

I'm not saying we let those middle class cuts happen all at once - we can raise rates slowly over several years.

Austerity doesn't work.

Yes theoretically thats 'fair' but kicking a economy while its down doesn't get it going much faster.

Like its been said 1000's times over in these threads already the 'job creators' are a myth so its time they pay a reasonable income tax instead of padding their Swiss accounts.

Higher taxes for the middle class? you just said it right in your own post. Less consumer spending which this economy doesn't need.

Exactly--you skip a vacation or two, that means the hotel and the other vacation-based industries hire less people. You go out to eat less, less food service workers have jobs. You only buy games on sale, less game designers' kids grow up with the chance to take vacations or go out to eat.

The middle class spends its money on things like vacations and restaurants and entertainment. The upper class spends its money acquiring more and more of the means of production. So when you kids grow up, they don't find themselves in a Greek-style meltdown: they find themselves in the world of Atlas Shrugged where the rich can say "what do you have to offer me?" and all they can say in response is "I'll clean the stables for your dressage horse."

If you really care about your kids and the world they'll inhabit someday, you'll realize that as worker productivity goes up and the means of wealth production become concentrated in fewer and fewer hands, the leverage your kids will have to make any kind of life for themselves will be gone. What job will they have? Hotel manager? Sorry--way more managers than open spots because only the rich go on vacations now and we only need a few high end hotels instead of lots of regular ones. Your kids will become entrepreneurs and open a restaurant? Have fun competing with all the other restaurants chasing a limited number of rich people--unlike Monty Python's Meaning of Life, someone ten times as rich doesn't eat ten times as often. Your kid wants to become a programmer? Have fun competing with the kids of all those hotel managers and restaurant owners who told their offspring "kid, my job won't exist by the time you've grown up."

Also, the only way a Greek-style meltdown will happen to your kids is if you live in one of these states that wants to secede and that actually happens. The reason Greece is happening is because members of the EU can walk away from places like Greece in a way the rich states in the USA can't walk away from the poor ones.

tl;dr: don't confuse a lack of wealth in society with an unbalanced distribution of wealth in society. Sure the economy sucks, but not if you're rich. It's magical thinking to believe that there's no way an economy could wind up in a situation where for some people it's better to reign in hell than serve in heaven. It's facing reality to realize that if someone is offered a bigger slice of a smaller pie--i.e., the chance to get richer even as the overall economy gets smaller--they're going to do just that.

Greg wrote:

Robear, I am sorry that I am not making myself clear.

Well, now it's clear. Thanks.

Greg wrote:

The above is quite distinct and separate from the Democratic proposal put forth by the Treasury Secretary on Thursday which is to raise 1.6T in taxes over the next 10 years. $400 Billion in unspecified spending cuts over the next 10 years. Spending 150 Billion in stimulus over the next 3 years with the first $50 billion to be spent in 2013. Delaying sequestration for 12 months. I view passing the Democratic Proposal as a tax hike because it is not a passive action, it will require new legislation to implement.

I don't think it is, Greg, at least not a great deal of it. $960 billion of that $1.6 trillion is letting the Bush era tax income cuts expire for people making more than $250,000. That $960 billion also includes letting the all the changes Bush introduced for capital gains and dividend tax rates expire and go back to their 1990s levels. I know there's also been some discussion about setting up another, much higher capital gains tax rate for people who make more than $1 million and I have absolutely no problem with that. Income is income.

$600 billion is slated to come from future changes to the tax code, which I believe will include finally trying fix (or at least patch) the Alternative Minimum Tax, having the Estate Tax return to 1990s levels (something that is going to happen under existing laws next year anyway), and other changes.

jdzappa wrote:

But this idea that the rich can solve all of our problems is pure fantasy. Even if we taxed them at 100 percent it wouldnt fix the deficit. Additionally, the ultrarich can just leave the country or hire an army of accountants and lawyers to make sure they don't really pay those higher rates.

As is the fantasy that the rich create jobs, that corporations are taxed and regulated too much, and that the rich will simply flee the country if they have to pay their fair share. Besides, no one is remotely talking about taxing the rich at 100%. The proposals on the table are to increase their income tax 3.6% and have the taxes they pay on capital gains and dividends return to pre-Bush tax cut levels. That isn't exactly a policy of eating the rich...

As others have pointed out, the rich benefited fantastically from decades of tax cuts and changes to financial laws. That has resulted in a virtually all gains in income since the 1970s going straight to the wealthiest Americans and a very rapid increase in income inequality. And while the middle class was hammered by the financial crisis--losing their jobs and even their house--the rich barely noticed it.

So now we have a weird, bifurcated economy. One one hand you have the corporations and the wealthy. Things are going fantastic for them. Profitability is the highest it's been since the 1950s and the stock market is over 13,000. On the other hand, you have everyone else and things aren't so great for them. Their wages have been stagnate for years, they are swimming in debt, they are underwater on their houses, and they are under constant threat of losing their jobs.

As others have pointed out, the true engine of our consumer-based economy are the consumers. Not the couple of thousand obscenely wealthy folks, but the 300,000,000 other folks who tend to spend most of what they make. Given the slow recovery and our anemic economic growth, the last thing we should be thinking about is decreasing the purchasing power of all those consumers by raising their taxes in the name of "fairness" or "spreading the burden". If you are really concerned about that, then you should be in favor of having the rich immediately pay back all the money they got to keep because of the Bush tax cuts. We could use that trillion dollars right about now.

CheezePavilion wrote:
jowner wrote:
jdzappa wrote:

Ok, I can accept repealing tax cuts for the one percent IF we also consider raising rates on everyone else. Since the Bush tax cuts were supposed to be temporary, why are they only going away for some people? You can talk about "only a couple percentage points" but those percentage points equal tens if not hundreds of thousands of dollars. Meanwhile, the overall hit to a middle class family would "only" be a couple thousand. Painful sure but probably not devastating. If I need to skip a vacation or two, go out to eat less, or only buy games on Steam sales to ensure my kid doesn't grow up to face a Grecian style meltdown, I'll take that bargain.

I'm not saying we let those middle class cuts happen all at once - we can raise rates slowly over several years.

Austerity doesn't work.

Yes theoretically thats 'fair' but kicking a economy while its down doesn't get it going much faster.

Like its been said 1000's times over in these threads already the 'job creators' are a myth so its time they pay a reasonable income tax instead of padding their Swiss accounts.

Higher taxes for the middle class? you just said it right in your own post. Less consumer spending which this economy doesn't need.

Exactly--you skip a vacation or two, that means the hotel and the other vacation-based industries hire less people. You go out to eat less, less food service workers have jobs. You only buy games on sale, less game designers' kids grow up with the chance to take vacations or go out to eat.

The middle class spends its money on things like vacations and restaurants and entertainment. The upper class spends its money acquiring more and more of the means of production. So when you kids grow up, they don't find themselves in a Greek-style meltdown: they find themselves in the world of Atlas Shrugged where the rich can say "what do you have to offer me?" and all they can say in response is "I'll clean the stables for your dressage horse."

If you really care about your kids and the world they'll inhabit someday, you'll realize that as worker productivity goes up and the means of wealth production become concentrated in fewer and fewer hands, the leverage your kids will have to make any kind of life for themselves will be gone. What job will they have? Hotel manager? Sorry--way more managers than open spots because only the rich go on vacations now and we only need a few high end hotels instead of lots of regular ones. Your kids will become entrepreneurs and open a restaurant? Have fun competing with all the other restaurants chasing a limited number of rich people--unlike Monty Python's Meaning of Life, someone ten times as rich doesn't eat ten times as often. Your kid wants to become a programmer? Have fun competing with the kids of all those hotel managers and restaurant owners who told their offspring "kid, my job won't exist by the time you've grown up."

Also, the only way a Greek-style meltdown will happen to your kids is if you live in one of these states that wants to secede and that actually happens. The reason Greece is happening is because members of the EU can walk away from places like Greece in a way the rich states in the USA can't walk away from the poor ones.

tl;dr: don't confuse a lack of wealth in society with an unbalanced distribution of wealth in society. Sure the economy sucks, but not if you're rich. It's magical thinking to believe that there's no way an economy could wind up in a situation where for some people it's better to reign in hell than serve in heaven. It's facing reality to realize that if someone is offered a bigger slice of a smaller pie--i.e., the chance to get richer even as the overall economy gets smaller--they're going to do just that.

You make some good points Cheeze but I still don't see how raising taxes solely on the rich alone is going to address a lot of those issues. And I'm still not seeing why the vast majority of Americans get a free pass when it comes to paying for the needs of society. Taxes for the working and middle classes are just as historically low as they are for those bloodsucking one percenters. Millions are barely paying any income taxes now - I recognize they pay into entitlement programs and state taxes but they're not paying much for defense, roads, etc.

Here are some more specifics on middle class tax rates from the Center on Budget and Policy Priorities. I was having trouble posting the graphs but it's worth looking at the link below to see them.

http://www.cbpp.org/cms/index.cfm?fa...

Federal taxes on middle-income Americans are near historic lows, according to the latest available data. That’s true both for federal income taxes and total federal taxes.

■Income taxes: A family of four in the exact middle of the income spectrum will pay only 5.6 percent of its 2011 income in federal income taxes, according to a new analysis by the Urban Institute-Brookings Institution Tax Policy Center. [3] Average income tax rates for these typical families have been lower during the Bush and Obama Administrations than at any time since the 1950s, as Figure 1 shows. (As discussed below, 2009 and 2010 were particularly low because of the temporary Making Work Pay Tax Credit.)
■Overall federal taxes: Overall federal taxes — which include income as well as payroll and excise taxes — on middle-income households are near their lowest levels in decades, according to the latest data from the Congressional Budget Office (CBO).

Federal Income Taxes Have Declined Significantly in Recent Decades

Federal income taxes on middle-income families have declined significantly in recent decades. In 2000, the year before the 2001 tax cut enacted by President Bush and Congress, the median-income family of four paid 8.0 percent of its income in individual income taxes, according to Tax Policy Center estimates — a smaller share than in any year since 1967 (except for 1998 and 1999).

The Bush tax cuts further reduced middle-income tax obligations. This year (i.e., when people pay income tax on 2011 income) the Tax Policy Center estimates that the median-income family of four will pay 5.6 percent of its income in federal income taxes.

The 5.6 percent rate (as well as the other rates discussed here for both 2011 and other years) is the effective tax rate, or the percentage of its income that a family pays in taxes. It is well below the 15 percent marginal tax rate — the rate paid on a filer’s next dollar of income — that a family of four in the exact middle of the income spectrum faces. A family’s effective tax rate typically is significantly lower than its marginal tax rate, because the family takes the standard deduction (or, in some cases, itemized deductions), personal exemptions, and tax credits such as the child tax credit, and because a portion of the family’s taxable income is taxed at lower rates. (For the median-income family, some of its income is not taxed, some is taxed at a 10 percent rate, and some is taxed at a 15 percent rate.)

jdzappa wrote:

You make some good points Cheeze but I still don't see how raising taxes solely on the rich alone is going to address a lot of those issues. And I'm still not seeing why the vast majority of Americans get a free pass when it comes to paying for the needs of society. Taxes for the working and middle classes are just as historically low as they are for those bloodsucking one percenters. Millions are barely paying any income taxes now - I recognize they pay into entitlement programs and state taxes but they're not paying much for defense, roads, etc.

Who is saying that raising taxes on the rich is going to solve everything? No one is.

We're trying to raise taxes on the rich because that's the only way the country can achieve the opposite goals our politicians want it to: grow the economy and shrink the deficit. Forcing the middle class and the poor to pay more taxes now will simply send our economy into a recession. And we know what that means: less tax revenues and higher deficits.

We're trying to raise taxes on the rich now because they've gotten away with a decade of massive tax cuts that didn't do what the conservative pundits said it would do: there aren't millions of new jobs, the economy isn't growing at 5 or 6 percent, and the amount of tax revenue the government takes in hasn't skyrocketed. We're also trying to raise taxes on the rich because they can afford it.

And, ironies or all ironies, a major reason why so many Americans aren't paying any income tax is the Bush tax cuts. The other, of course, is that they aren't making enough money.

jdzappa wrote:

You make some good points Cheeze but I still don't see how raising taxes solely on the rich alone is going to address a lot of those issues. And I'm still not seeing why the vast majority of Americans get a free pass when it comes to paying for the needs of society. Taxes for the working and middle classes are just as historically low as they are for those bloodsucking one percenters. Millions are barely paying any income taxes now - I recognize they pay into entitlement programs and state taxes but they're not paying much for defense, roads, etc.

It's not about what they're paying in taxes, it's about what they're buying with the money left over after taxes. Even if they're not paying much for defense, roads, etc., they're also not buying things that will give them a return on their investment. At best most middle and working class people can hope to buy their kids a college education. Rich people buy their kids the store where those other kids will shop, or the apartment building where those kids will pay rent, or the land development company that will build them their house, or even the business where those kids will go to work. Even if a middle class person can afford to buy their kids a small business, that even looks scary these days.

I guess a lot of my thinking comes from 4x games: it's not just about this turn, it's about how this turn sets you up for next turn, and the turn after that. In like, Master of Orion, the Psilons would prefer everyone just peacefully expand because the more time that passes before everyone has to put resources into building fleets instead of doing research, the more their research advantage over everyone pays dividends until they're just unstoppable.

Very few of us turn our labor directly into wealth. Most of us don't go fishing and then eat the fish to feed ourselves. We work for someone or we sell something to other people. You don't negotiate with a fish. A fish doesn't consider firing you as a fisherman and going with the other guy who is offering a bigger piece of bait on his hook. At the end of the day most of us engage in exchange with other people (and even our fisherman probably work for the owner of the boat) with the raw materials coming from property other people own or extraction rights or something. So most of our economic activity isn't about Man vs. Nature, it's about people doing business with other people to exchange things, like money for labor.

When you engage in exchange with other people, that's about leverage. And as the rich keep getting richer and richer, they get more and more leverage because the rich increasingly need any individual middle/working class person less than vice versa (the person who is looking to put food on the table needs the deal to get done way more than the person who needs to put a dressage horse in his stable); the more leverage you have, the more advantageous the terms you can demand. The more advantageous the terms you can demand, well, the richer you get.

See the feedback loop? Dirty liberals like me don't have to go to things like calling them bloodsuckers. All I'm doing is looking at the economy as a big game, and the thing about games is just because you can't win this turn doesn't mean you haven't set yourself up to win on a future turn. If they're bloodsuckers, they're not rampaging vampires that kill all at once. They just take a little bit of blood this round, and next round you're a little more anemic than you were last round while they're a little bit stronger this round.

Now, maybe you disagree with that characterization of how things are. However, if you don't, there are only so many places things can go from here. We can tax the rich and redistribute to the poor to offset the effect of their use of their extra money to capture the means of wealth production. We can encourage the middle and working classes to take some personal responsibility and stop having kids, and instead let the richer members of society take care of reproduction, as inheritance is one means of redistributing wealth. Or we can watch our society become one of the Haves and the Have Nots and lose our middle class. You just don't strike me as the type to choose for American society to change that radically.

In the end, my argument doesn't depend on the 1% being evil, mustache twirling top-hat wearing villains. It depends on realizing the things about the free market I think we all agree on can have major effects on society when we consider what those forces of the free market produce in the aggregate. This is not about fairness as in "why should he have so much while I have so little?" or that kind of direct class warfare. This is about asking ourselves what kind of society we want to leave to our kids.

Taxing the rich is going to work because they are not driving the economy. They funnel money elsewhere, and buy more expensive commodities that they use less which I think is really key.

If you buy a $90k car it should be the equivalent boost to the economy as 3 people buying $30k cars. Except it doesn't because the 1 expensive car gets used only on weekends and the other 3 cars are everyday vehicles. The everyday vehicles drive business for mechanics, gas stations, parking lots, tire stores, etc that the stagnant expensive car does at a much slower rate. Even if the $90k car is a commuter car, it is not going to be able to impact the economy at the rate of 3 cars.

I don't see how the economy can grow if it is stagnant. It is becoming much more apparent to me that the middle and lower classes are much better at keeping the economy mobile.

A bit of an aside, but I think it's pertinent to the discussion.

How much do the proposed 'increases' actually affect the rich? Maybe I read too much Robert Kiyosaki*, but my understanding is that most of the money the rich earn is tied up in corporations and trusts anyway, so anything they earn in a way that can be taxed is probably only a teeny percentage of what they really earn.

So talking about a 3.6% increase of base tax isn't an increase on 100% of their income but somewhere between 0.001 and 20% of their real income. (arbitrary numbers)

*Rich Dad's Conspiracy of the Rich is actually keeping me awake at night at the moment. A pinch of salt and all, but it's chilling.

Hooray. Looks like the democrats are starting the "we showed you ours, now show us yours game" with the republicans. About damn time.

MrDeVil909 wrote:

A bit of an aside, but I think it's pertinent to the discussion.

How much do the proposed 'increases' actually affect the rich? Maybe I read too much Robert Kiyosaki*, but my understanding is that most of the money the rich earn is tied up in corporations and trusts anyway, so anything they earn in a way that can be taxed is probably only a teeny percentage of what they really earn.

So talking about a 3.6% increase of base tax isn't an increase on 100% of their income but somewhere between 0.001 and 20% of their real income. (arbitrary numbers)

*Rich Dad's Conspiracy of the Rich is actually keeping me awake at night at the moment. A pinch of salt and all, but it's chilling.

It really depends upon who you ask. Warren Buffet, for example has been open that based on how he makes income, and manages to get rebates and breaks, he pays a lower rate of taxes than his employees.

As an example, Rick Wagoner, former CEO of GM was not drawing a salary from GM at various times, his compensation was in assets, stocks, and bonds and all taxed lower than the income tax rate. The corporation can also enjoy tax deductions for incentives to that CEO-cars, use of jets, bonus stock. It is estimated that at points over the past 5 years GE paid negative taxes through these loopholes.

A trickle down Reagan-ominist or "crazy twat" as many might call them would state this gives GE and the CEO the capitol and incentives to spend that wealth by hiring more people and putting that money into the economy. That unravels when you see that over a 10 year period CEO pay went up about 30 percent, corporate taxes went down, and unemployment ballooned.

This may not be the perfect setting for this, but am I the only one who would rather the government to not have social security / Medicare when I retire? I'm not ideologically opposed, and I don't expect every Tom and Jane to scrape by enough to not need those programs, but between all the talk about the demographic challenges to those programs and all the deficit discussions the last tenish years, I don't expect that all the money I'm paying in will in any way be available for me down the road. So why not phaseit out?

I propose that anyone already or very soon to receive benefits should have no change to their plans, and to taper away by age those younger and more time to adapt. For instance, those in their 50s would only, at retirement age, receive 90%. Those in their 40s, 70%, and so on, until the program either no longer around, or the times become better for the programs. If the news is true that Medicare is already going bankrupt, why not play along?

The biggest trouble, of course, is how then to meet the same societal need, preventing elderly starvation and unacceptable medical conditions, without a society-wide "giveaway"? I get quite interested in the original conditions and aims under which these programs were established when asking these questions.

MrDeVil909 wrote:

So talking about a 3.6% increase of base tax isn't an increase on 100% of their income but somewhere between 0.001 and 20% of their real income. (arbitrary numbers)

It's not even an actual 3.6% increase. It's 3.6% on the income above a certain point, but given that they make enough to be hit by that, they also benefit completely from all of the other cuts theoretically being put in place for everyone except the top bracket.

Keithustus wrote:

The biggest trouble, of course, is how then to meet the same societal need, preventing elderly starvation and unacceptable medical conditions, without a society-wide "giveaway"? I get quite interested in the original conditions and aims under which these programs were established when asking these questions.

You don't. Which is exactly why people started clamoring for a system that ensured old people, those that were too sick/injured to work, and the children of such didn't just starve or die. A first world country--or, if you prefer, a Christian nation--doesn't just cast aside its elderly and feeble population once they are no longer productive. Hell, there's plenty of archaeological evidence that even early man cared for the old and sick and simply didn't toss them in the midden.

There's also plenty of information out there about Social Security and how it got started. You might want to begin by Googling Dr. Francis E. Townsend. He's the chap who kicked everything off way back in 1933 with a simple newspaper editorial.

billt721 wrote:
MrDeVil909 wrote:

So talking about a 3.6% increase of base tax isn't an increase on 100% of their income but somewhere between 0.001 and 20% of their real income. (arbitrary numbers)

It's not even an actual 3.6% increase. It's 3.6% on the income above a certain point, but given that they make enough to be hit by that, they also benefit completely from all of the other cuts theoretically being put in place for everyone except the top bracket.

Precisely.

Someone who makes $250,100 would pay exactly $3.60 more in federal income taxes than he would have last year.

Paleocon wrote:
billt721 wrote:
MrDeVil909 wrote:

So talking about a 3.6% increase of base tax isn't an increase on 100% of their income but somewhere between 0.001 and 20% of their real income. (arbitrary numbers)

It's not even an actual 3.6% increase. It's 3.6% on the income above a certain point, but given that they make enough to be hit by that, they also benefit completely from all of the other cuts theoretically being put in place for everyone except the top bracket.

Precisely.

Someone who makes $250,100 would pay exactly $3.60 more in federal income taxes than he would have last year.

*slow clap*

I always enjoy when people talk like they explain marginal tax rates.

edosan wrote:
Paleocon wrote:
billt721 wrote:
MrDeVil909 wrote:

So talking about a 3.6% increase of base tax isn't an increase on 100% of their income but somewhere between 0.001 and 20% of their real income. (arbitrary numbers)

It's not even an actual 3.6% increase. It's 3.6% on the income above a certain point, but given that they make enough to be hit by that, they also benefit completely from all of the other cuts theoretically being put in place for everyone except the top bracket.

Precisely.

Someone who makes $250,100 would pay exactly $3.60 more in federal income taxes than he would have last year.

*slow clap*

I always enjoy when people talk like they explain marginal tax rates.

But that $3.60 will break the family farm.

Paleocon wrote:
edosan wrote:
Paleocon wrote:
billt721 wrote:
MrDeVil909 wrote:

So talking about a 3.6% increase of base tax isn't an increase on 100% of their income but somewhere between 0.001 and 20% of their real income. (arbitrary numbers)

It's not even an actual 3.6% increase. It's 3.6% on the income above a certain point, but given that they make enough to be hit by that, they also benefit completely from all of the other cuts theoretically being put in place for everyone except the top bracket.

Precisely.

Someone who makes $250,100 would pay exactly $3.60 more in federal income taxes than he would have last year.

*slow clap*

I always enjoy when people talk like they explain marginal tax rates.

But that $3.60 will break the family farm.

Think of all the jobs that could have been created! I'm going Galt!

Paleocon wrote:
billt721 wrote:
MrDeVil909 wrote:

So talking about a 3.6% increase of base tax isn't an increase on 100% of their income but somewhere between 0.001 and 20% of their real income. (arbitrary numbers)

It's not even an actual 3.6% increase. It's 3.6% on the income above a certain point, but given that they make enough to be hit by that, they also benefit completely from all of the other cuts theoretically being put in place for everyone except the top bracket.

Precisely.

Someone who makes $250,100 would pay exactly $3.60 more in federal income taxes than he would have last year.

Someone else who understands tax brackets? I apologize in advance for the day we meet, when I high-five you so hard it shatters your arm.

edosan wrote:
Paleocon wrote:
edosan wrote:
Paleocon wrote:
billt721 wrote:
MrDeVil909 wrote:

So talking about a 3.6% increase of base tax isn't an increase on 100% of their income but somewhere between 0.001 and 20% of their real income. (arbitrary numbers)

It's not even an actual 3.6% increase. It's 3.6% on the income above a certain point, but given that they make enough to be hit by that, they also benefit completely from all of the other cuts theoretically being put in place for everyone except the top bracket.

Precisely.

Someone who makes $250,100 would pay exactly $3.60 more in federal income taxes than he would have last year.

*slow clap*

I always enjoy when people talk like they explain marginal tax rates.

But that $3.60 will break the family farm.

Think of all the trains that could have been built! I'm going Galt!

ftfy