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Gregg
4-16-12, 11:02am
From a piece on CNN (http://www.cnn.com/2012/04/16/politics/crowley-buffett-rule/index.html):

"A minimum 30% tax on million-dollar incomes won't do much to eat away at the nation's debt, it won't create jobs, and no one expects it to get through the Democratic-controlled Senate, much less the Republican-majority House."

So what do you think? A good rule with no support? A misguided attempt by people who really don't understand the economy? Is it now just the President's turn to play some election year politics?

Personally, I think it started out as the second and moved to the third. 60% of Americans disagree with me (Gallop: 60% support it, 37% oppose).

Alan
4-16-12, 11:07am
I agree that it may have started out as the second and then became the third.

I also think that the 60% who support it have simply bought into the "fairness" mantra, not considering the fact that if it were 'fair', it would by definition be 'without bias'. Doesn't the government support Truth In Labeling laws?

By the way, do you know who else paid a lower effective tax rate than his secretary?

peggy
4-16-12, 12:09pm
I paid a higher tax rate than Romney, and it's my privilege to be able to support multiple homes and elevators for cars for the super wealthy. I mean, do you know what a stable of horses costs these days? !Splat!

A percentage of income is a percentage of income. All income. Just close the loopholes and tax ALL income at the same rate, including capital gains, then I'd be happy. It should be a sliding rate, cause, 10% of 1000 means a whole lot more than 10% of a million, to the individual. But even then, if you tax it all fairly, then the upper rate doesn't need to be 30%.
And that bull about them being 'job creators' is just that. BS Individual tax rates don't have squat to do with job creating except for the gardener and pool boy. Taxing Romney fairly wouldn't make him less of a business man. He'd still like firing people at the higher rate. :0!

Gregg
4-16-12, 12:29pm
A percentage of income is a percentage of income. All income. Just close the loopholes and tax ALL income at the same rate, including capital gains, then I'd be happy.

It's not perfect, but I'm still generally a fan of a flat tax. And yes, on all income sources. That means Warren Buffett's dividends, his secretary's salary or my 401k disbursements. I don't know the math exactly, but it seems like 15% should be enough to run the government on and doesn't sound like an unfair number.

Gregg
4-16-12, 12:32pm
By the way, do you know who else paid a lower effective tax rate than his secretary?

Well, according to those pesky watchdogs at ABC News, HE (http://abcnews.go.com/blogs/politics/2012/04/president-obamas-secretary-paid-higher-tax-rate-than-he-did/) did.

ApatheticNoMore
4-16-12, 1:22pm
I think I'm looking at a higher tax rate than that on some income probably as well. Second year in a row I'm filing an extension because I just don't understand my taxes still. They actually got more confusing that before, income started appearing in weird places, noone knew where it was coming from and going to. Sigh, this too shall pass.

txgran
4-16-12, 1:32pm
From a piece on CNN (http://www.cnn.com/2012/04/16/politics/crowley-buffett-rule/index.html):

"A minimum 30% tax on million-dollar incomes won't do much to eat away at the nation's debt, it won't create jobs, and no one expects it to get through the Democratic-controlled Senate, much less the Republican-majority House."

So what do you think? A good rule with no support? A misguided attempt by people who really don't understand the economy? Is it now just the President's turn to play some election year politics?

Personally, I think it started out as the second and moved to the third. 60% of Americans disagree with me (Gallop: 60% support it, 37% oppose).

I'm with the 60%......the rich should pay their fair share.

Tradd
4-16-12, 1:56pm
I think the first thing that needs to be done is closing a lot of the loopholes and maybe even doing away with a lot of deductions.

One deduction I wonder about is the charitable one. I never take it, because for me to itemize as a single with no dependents doesn't make financial sense. For you average income folks, does the charitable deduction make much of a difference for you tax-wise, or is this something that only really benefits higher income people?

bae
4-16-12, 2:17pm
I'd think you'd want to take a step back, and talk about what "fair" means first...

Gregg
4-16-12, 2:19pm
I'm with the 60%......the rich should pay their fair share.

Care to elaborate on what that might be?

herbgeek
4-16-12, 3:15pm
If we want to talk about fair share, how about we include those 49% of folks who don't pay income taxes AT ALL? The top 10% of earners pay 70% of all the taxes. How is that not fair?

Source: http://www.ntu.org/tax-basics/who-pays-income-taxes.html

ApatheticNoMore
4-16-12, 3:36pm
The only way to get them would be to eliminate the credits middle class people with kids take (mostly the child credit and mortgage interest probably). Like I found out from doing the math it is not possible to fall below the tax threshold if you work full time, no deductions, no kids (even if you earn minimum wage). So you have to ask if you really want to eliminate mortgage interest and kid deductions and find someone who will campaign on that? (good luck with the latter)

loosechickens
4-16-12, 3:41pm
Well, since those extremely wealthy folks were doing just fine, even when their tax rates were well above 50%, and since societies really work best, especially democratic societies, when the middle class is healthy and prosperous, and since the extremely wealthy in our society have reaped a disproportionate amount of the gains in these past decades while the middle class has kind of taken it in the shorts, it's a start.

The folks with the huge amounts of money have the wherewithal to buy the politicians with their campaign donations to vote for policies that tilt the playing field firmly in the direction of those big money folks. It's time that some attention was paid to making things better for the 99%, rather than even more benefits for the 1%.

We are a part of that fortysome percentage of households that paid no Federal tax this year. So mixed in with the poor, who simply have too little income to owe tax, middle class working people who manage to fall in that group because of children or mortgage deductions, you can add a number of people, many millionaires, who pay no Federal taxes, too. If your income is derived from capital gains, dividends, tax exempt investments, limited partnerships that are taxed advantageously, etc., you can have quite a nice income, but the "wage slaves" in the middle class will be paying through the wazoo, while you sail through, courtesy of the very rich who managed to buy politicians who write the tax code, paying literally, nothing. The superrich didn't INTEND those tax laws for folks like us, but if your income comes from the same sources that the superrich get their income from, you ride on their coattails with those preferential tax laws.

We just finished doing our taxes this year. We are quite comfortable......enjoyed that nice Princess cruise down through the Panama Canal in January, living very nicely. Because of our tax code (which really wasn't designed for us, but since we ARE the investor class, however small), we, this year, paid no Federal income tax at all.

Capital gains shielded from even the lower rate by tax regulations intended to allow the very rich to harvest capital losses on stocks you have every intention of dying owning, and passing to your children whose cost basis will reset at the valuation at the time of your death, thereby having had the advantage of those "losses" without ever suffering the real loss, limited partnerships with their advantageous tax benefits, investments in tax-free municipal bonds, and the preferential way stock dividends are taxed (paying on only half your dividends), if we HAD a secretary with the same income, but derived from a paycheck, she or he would have paid quite a bit of Federal tax.

The tax playing field is tilted against income derived from work and toward income derived from dividends and capital gains. It isn't right that the very rich pay less percentage of their income than people making only a tiny fraction of their income, and SOME of the rich agree with that and are willing to see increased fairness. Others want to grasp hold of every cent they can, regardless of whether they have enough to live a thousand lifetimes already.

It is not fair that we had a comfortable income this year, yet owed no Federal taxes at all. It is not fair that the very wealthy pay a lesser rate than the people who work for them. It is not fair that access to politicians ensures that the tax laws are made in the favor of the very rich, or those whose income is derived from investments rather than from working.

Even though it is to my personal disadvantage, I would like to see that changed. My income from capital gains and dividends spends exactly the same as if those dollars were obtained by a paycheck. They don't give me half as much groceries at the grocery store for those dollars. Why should those dollars be taxed at half the rate (or even allowed to be free of tax at all) because we didn't EARN them, but simply sent our money out to work. Income is income.

It's time for this change. I agree with the Buffett rule. Completely.

Alan
4-16-12, 3:49pm
Even though it is to my personal disadvantage, I would like to see that changed. My income from capital gains and dividends spends exactly the same as if those dollars were obtained by a paycheck. They don't give me half as much groceries at the grocery store for those dollars. Why should those dollars be taxed at half the rate (or even allowed to be free of tax at all) because we didn't EARN them. Income is income.

It's time for this change. I agree with the Buffett rule. Completely.
How many times should the same dollar be taxed? If you, as a partial owner of a company, invest your money in the form of stocks or bonds, which then generates a 10% annual return, should it be subjected to the highest corporate tax rate in the world prior to you receiving it only to then have it taxed again at a 25 to 30% rate? Exactly how many slices of the pie should the government take before you are allowed to enjoy the crumbs?

loosechickens
4-16-12, 4:01pm
That argument might hold some water, Alan, if hardly any corporations really PAID those corporate tax rates, but since something like 2/3 of corporations pay none at all, and even multinational corporations pay a tiny fraction of that marginal rate, it's more like a shell game, that argument.

Should our corporate marginal tax rate be lowered and the loopholes that make most corporations pay only a fraction of the marginal rate be done? Sure. Let's go.

Hey, the very, very rich have managed in many ways to gull people into believing that their pockets weren't being picked. But it may be that the "pickees" are getting fed up. Especially since the slice of the pie that those very, very rich people have has gained steadily in size. And that if anyone is getting "crumbs", it's NOT them, hahahaha.

gotta go......carry on.....back tonight to see how the discussion went.

txgran
4-16-12, 4:15pm
Well, since those extremely wealthy folks were doing just fine, even when their tax rates were well above 50%, and since societies really work best, especially democratic societies, when the middle class is healthy and prosperous, and since the extremely wealthy in our society have reaped a disproportionate amount of the gains in these past decades while the middle class has kind of taken it in the shorts, it's a start.

The folks with the huge amounts of money have the wherewithal to buy the politicians with their campaign donations to vote for policies that tilt the playing field firmly in the direction of those big money folks. It's time that some attention was paid to making things better for the 99%, rather than even more benefits for the 1%.

We are a part of that fortysome percentage of households that paid no Federal tax this year. So mixed in with the poor, who simply have too little income to owe tax, middle class working people who manage to fall in that group because of children or mortgage deductions, you can add a number of people, many millionaires, who pay no Federal taxes, too. If your income is derived from capital gains, dividends, tax exempt investments, limited partnerships that are taxed advantageously, etc., you can have quite a nice income, but the "wage slaves" in the middle class will be paying through the wazoo, while you sail through, courtesy of the very rich who managed to buy politicians who write the tax code, paying literally, nothing. The superrich didn't INTEND those tax laws for folks like us, but if your income comes from the same sources that the superrich get their income from, you ride on their coattails with those preferential tax laws.

We just finished doing our taxes this year. We are quite comfortable......enjoyed that nice Princess cruise down through the Panama Canal in January, living very nicely. Because of our tax code (which really wasn't designed for us, but since we ARE the investor class, however small), we, this year, paid no Federal income tax at all.

Capital gains shielded from even the lower rate by tax regulations intended to allow the very rich to harvest capital losses on stocks you have every intention of dying owning, and passing to your children whose cost basis will reset at the valuation at the time of your death, thereby having had the advantage of those "losses" without ever suffering the real loss, limited partnerships with their advantageous tax benefits, investments in tax-free municipal bonds, and the preferential way stock dividends are taxed (paying on only half your dividends), if we HAD a secretary with the same income, but derived from a paycheck, she or he would have paid quite a bit of Federal tax.

The tax playing field is tilted against income derived from work and toward income derived from dividends and capital gains. It isn't right that the very rich pay less percentage of their income than people making only a tiny fraction of their income, and SOME of the rich agree with that and are willing to see increased fairness. Others want to grasp hold of every cent they can, regardless of whether they have enough to live a thousand lifetimes already.

It is not fair that we had a comfortable income this year, yet owed no Federal taxes at all. It is not fair that the very wealthy pay a lesser rate than the people who work for them. It is not fair that access to politicians ensures that the tax laws are made in the favor of the very rich, or those whose income is derived from investments rather than from working.

Even though it is to my personal disadvantage, I would like to see that changed. My income from capital gains and dividends spends exactly the same as if those dollars were obtained by a paycheck. They don't give me half as much groceries at the grocery store for those dollars. Why should those dollars be taxed at half the rate (or even allowed to be free of tax at all) because we didn't EARN them, but simply sent our money out to work. Income is income.

It's time for this change. I agree with the Buffett rule. Completely.

Very well stated......

Gregg
4-16-12, 4:26pm
By the time my dollars arrive at the bank I've already been taxed on them at a few different levels. I then use those dollars to pay my property taxes. Or fill my tank and pay fuel/wheel tax as I do. Or I stop at the store for shampoo and pay sales tax along with the product. Or I pay my cell phone bill which has more silly little nickle and dime taxes than I can even fathom... Under our current system it is nearly impossible to transfer money from one entity or person to another without additional taxation at every step and I believe the few transactions so far immune are part of proposed revisions (services, interstate transactions, etc.). My pie has diminished significantly before I ever get to take a bite.

HKPassey
4-16-12, 4:34pm
I think the first thing that needs to be done is closing a lot of the loopholes and maybe even doing away with a lot of deductions.

One deduction I wonder about is the charitable one. I never take it, because for me to itemize as a single with no dependents doesn't make financial sense. For you average income folks, does the charitable deduction make much of a difference for you tax-wise, or is this something that only really benefits higher income people?

If you have enough deductions to make itemizing worthwhile, yes, it can make a difference even for lower-income folks, especially if you tithe. This year was an ugly tax year for me: I lost my home to a fraudulent loan, so goodbye mortgage tax deduction. Lost my health insurance, so goodbye to self-employed premium deduction. Had to liquidate IRA funds to pay basic bills. "Income" from settling a debt I couldn't afford to pay in full (and two more to go - even if I could find the money to settle, I couldn't afford the taxes). Taxes on unemployment income... the list goes on. I made less this year than any year in the last decade, yet more in taxes. Ouch.

HKPassey
4-16-12, 4:36pm
An interesting angle to this debate can be found in The Spirit Level, a book examining the societal costs of income/wealth inequality. It's hard to fully consider the "fairness" question without looking at that aspect.

Yossarian
4-16-12, 5:26pm
That argument might hold some water, Alan, if hardly any corporations really PAID those corporate tax rates, but since something like 2/3 of corporations pay none at all, and even multinational corporations pay a tiny fraction of that marginal rate, it's more like a shell game, that argument.



You can cherry pick some years where there are timing differences between book and tax income or skew the stats with a large number of small companies that really have no income or pay it all to the owners in salary, or whine about the deferral on taxation of foreign earnings when most of the rest of the world doesn't tax foreign earnings at all. But for the most part corporate income is taxed.

Here is an open invitation to anyone who thinks dividends are taxed too low- run all your income through a corporation, have the corp pay tax at 35% corporate rates, and then pay yourself a dividend that is then taxed at 15%. Then you too can have a 15% tax rate. See how great that would be? - hint, if you think it would be you need help with math.

You can change the system, but you have to change the system, you can't just change parts or you end up with the Frankenstein system we have now.

LDAHL
4-16-12, 5:32pm
Would this new rule replace the AMT, or would it function as an alternative alternative minimum tax?

ApatheticNoMore
4-16-12, 5:39pm
The AMT does need to go (a more convoluted secret taxation system you could hardly devise), but sure replace it with higher progressive taxation, reduce deductions.

bae
4-16-12, 6:01pm
Well, since those extremely wealthy folks were doing just fine, even when their tax rates were well above 50%, ....

That's not exactly a fair comparison of tax rates, is it?

When the tax rates on "the extremely wealthy" were higher, the structure of the tax code itself was more-than-a-bit different, so simply loooking at notional rates doesn't tell you the story.

To compare honestly between different eras, you'd want to look at the actual effective rates paid, bottom-line.

As I suspect most people understand.

bae
4-16-12, 6:03pm
An interesting angle to this debate can be found in The Spirit Level, a book examining the societal costs of income/wealth inequality. It's hard to fully consider the "fairness" question without looking at that aspect.

Ah yes, now we see it. It's unfair that some people have a great deal of wealth. We need to spread that wealth around....

bunnys
4-16-12, 7:17pm
I do not understand the rationale of expecting the very poorest people in our society to have to pony up and pay more taxes than they already do. (Yes, they do pay taxes. Sales tax, gas tax, utility taxes, etc.) So many of them have multiple part time jobs with no benefits making minimum wage and must run households and raise children and pay health costs on those paltry hourly wages. Still, people want the poorest to cough up more and "pay their fair share" whatever that means. This mentality seems so utterly heartless to me.

flowerseverywhere
4-16-12, 7:18pm
Ah yes, now we see it. It's unfair that some people have a great deal of wealth. We need to spread that wealth around....

after taking a big cut to run an inneficient government that pays for many worthless programs and a military machine.

If the wealthy are taxed more it is not going to do a bit of good if spending is not cut as well. We have this giant deficit and need to bite the bullet. Do we really need a department of education and legislators making laws about schooling at the federal and state levels? If we simplify the tax code maybe the huge IRS budget can also be cut.

Sometimes we forget all the philanthropy that many wealthy people are involved in without first siphoning through our tax system and having someone else determine what the good causes are. Someone in my town gave $500,000 towards a new YMCA- I imagine they are quite wealthy to be able to do that. Many of our local businesses sponsor music performances, scholarships, baseball teams etc. The whole community benefits. If by doing so they pay less in taxes I am all for it.

There are a lot of good people doing a lot of good in this world spending money supporting good causes, paying for their kids education, helping their elderly parents, and helping establish programs that help people help themselves.

Yossarian
4-16-12, 7:22pm
"pay their fair share" whatever that means

So what does that mean? Should the amount of tax you pay have any relation to the amount of government services you consume? Should we take money from those that have it just because they have it or should it matter how they got it? Which is more important, income or assets? What exactly do you think makes it a "fair" share?

iris lily
4-16-12, 7:43pm
Y'all are wrong! WRONG I TELL YOU!!!!!

The Buffet Rule means that you always take a clean plate when you go back for seconds, and never never never drool into the community food supply on a buffett line.

I really thought that you guys knew these things...

bae
4-16-12, 7:58pm
What's really funny is that within *minutes* of the Senate vote on this today, I received bulk emails from various progressive organizations complaining about the vote failing, and asking for funds to defeat The Forces Of Evil in the upcoming elections.

Go figure...

The whole issue is clearly yet another attempt to divide us all, to raise money for politicians, and to keep stirring the pot.

Alan
4-16-12, 8:19pm
Y'all are wrong! WRONG I TELL YOU!!!!!

The Buffet Rule means that you always take a clean plate when you go back for seconds, and never never never drool into the community food supply on a buffett line.

I really thought that you guys knew these things...
Oh, everybody knows that. This is about the sliding scale they charge you at the door. Half the diners eat for free and the few percent they dislike the most, who are already paying for 70 or so percent of the evenings meals, get to pay an additional premium for the privilege of dessert.

ApatheticNoMore
4-16-12, 8:47pm
They pay for what, their own wars? Who benefits from those anyway?

Who paid for the federal reserve bailout of all the banks, and then much of the European banks? (which may have really be an indirect bailout of who knows what). 1.2 trillion? Who benefited?

Maybe worse if you believe things like this:
http://dailybail.com/home/holy-bailout-federal-reserve-now-backstopping-75-trillion-of.html

Absolutely massive bailout of the financial system (likely continues with more and more and more).

jp1
4-16-12, 11:25pm
How many times should the same dollar be taxed? If you, as a partial owner of a company, invest your money in the form of stocks or bonds, which then generates a 10% annual return, should it be subjected to the highest corporate tax rate in the world prior to you receiving it only to then have it taxed again at a 25 to 30% rate? Exactly how many slices of the pie should the government take before you are allowed to enjoy the crumbs?

Or alternatively, which income should be taxed at a higher percentage. Income derived from the sweat of one's labor or income derived from opening an investment account statement and smiling?

jp1
4-16-12, 11:26pm
So what does that mean? Should the amount of tax you pay have any relation to the amount of government services you consume? Should we take money from those that have it just because they have it or should it matter how they got it? Which is more important, income or assets? What exactly do you think makes it a "fair" share?

It's impossible to know how much government services anyone takes. How could one even begin to calculate the benefit the oil companies get from our military presence in the middle east. I'd be willing to guess, though, that it far outstrips whatever taxes they pay.

jp1
4-16-12, 11:26pm
If we want to talk about fair share, how about we include those 49% of folks who don't pay income taxes AT ALL? The top 10% of earners pay 70% of all the taxes. How is that not fair?

Source: http://www.ntu.org/tax-basics/who-pays-income-taxes.html

Of course the people who scream about all those who "don't pay taxes" ignore the fact that a sizeable chunk of the non-tax-payers are retired and living off a relatively small social security income and students. In other words, people who DID pay taxes for most of their lives or those who WILL pay taxes most of their lives.

And as Tradd mentioned, there are a lot of us with no children and no mortgage deduction who are only able to take the standard deduction. I make a high 5 figure income and pay a way higher percentage tax rate then Buffet. And that doesn't even take into account the very regressive withholding taxes for social security and medicare, which don't get taken out of investment income.

iris lily
4-17-12, 12:12am
Oh, everybody knows that. This is about the sliding scale they charge you at the door. Half the diners eat for free and the few percent they dislike the most, who are already paying for 70 or so percent of the evenings meals, get to pay an additional premium for the privilege of dessert.

ha ha ha ok.

Gregg
4-17-12, 9:30am
I do not understand the rationale of expecting the very poorest people in our society to have to pony up and pay more taxes than they already do. (Yes, they do pay taxes. Sales tax, gas tax, utility taxes, etc.) So many of them have multiple part time jobs with no benefits making minimum wage and must run households and raise children and pay health costs on those paltry hourly wages. Still, people want the poorest to cough up more and "pay their fair share" whatever that means. This mentality seems so utterly heartless to me.

I know of no one proposing that the burden on the poor should be increased. Economic equations are neither heartless or compassionate in their own right. That type of consideration comes from the parameters set by those who apply the rules to society. Even flat tax advocates who propose a percentage straight across the board all have lower limits below which a person would not be expected to pay. Some people misinterpret that as compassion, but in reality it is simply a practical matter. It doesn't make any sense to force someone to pay when doing so will place them in a position of needing more assistance that will cost society more than those people paid in the first place.

iris lily
4-17-12, 10:47am
I know of no one proposing that the burden on the poor should be increased. ...

Oh I don't know. There is one point of view that holds EVERYONE w should have some skin in the "Tax Me" game. I realize it's not practical to require someone below the poverty line to cough up a few bucks for income taxes, they just don't have it, but I like the philosophy of it. Everybody plays, everybody pays.

Yossarian
4-17-12, 10:55am
How could one even begin to calculate the benefit the oil companies

Companies don't receive any benefits. Ever. All tax burdens fall on people- employees, investors or consumers.

In most cases a consumption oriented tax could be tailored to more readily reflect government usage than one based on income.

peggy
4-17-12, 12:53pm
..... but I like the philosophy of it. Everybody plays, everybody pays.

Yea, kind of like health care with the affordable care act. Everyone plays so everyone pays! Glad you finally see the light Iris L.;)

stuboyle
4-17-12, 1:08pm
I'm getting into this conversation late but one thing they never mention is that by the time you get your dividend, its already taxed at the corp tax rate of 35%, though the corporation probably pays a someone lower rate, then you pay our 15% tax, so its double-taxed.

I general, I am for all tax hikes which increase other taxes and against those which increase mine :)

peggy
4-17-12, 1:13pm
Companies don't receive any benefits. Ever. All tax burdens fall on people- employees, investors or consumers.

In most cases a consumption oriented tax could be tailored to more readily reflect government usage than one based on income.

Of course they do. Benefits aren't just in dollars. Benefits come in the form of an educated, safe work force, good roads to get that work force to your business and goods out. Benefits like a police force and fire protection for your work force and your goods and place of business. A stable economy is another benefit. And these are just the benefits here at home. Overseas the benefits are not being shot at, or held hostage to unreasonable blackmail to do business. And you and I both know our government advocates for our business overseas constantly. In fact, that is a large part of what Our government does 'overseas'.
A safe, stable work environment and economy is the best benefit of all. And, despite what some may think, the government providing a safe, stable work environment and economy for the workers too is also a huge benefit for business.
But, when that delicate balance between corporate interest and worker interest is skewed, as it has been happening in the last 3 decades, the whole house of cards comes crashing down. A strong middle class is essential for a strong economy, which is essential for strong business, which is the best benefit of all, for everyone.
Buffet understands this principle. Actually, most smart business people understand this, but in this grab-what-you-can environment, greed trumps everything. Why try to fix this and stop the giant suck from the middle class to the upper tiers when all your friends around you are busy raking in the dough while they can? Rape and pillage then simply move on to the next big economy. China perhaps, or India. The world is flat, after all.

Gregg
4-17-12, 1:18pm
Peggy, I agree that a lot of the things you listed benefit companies, but things like an educated workforce are a benefit to the society as a whole. The fact that a company would derive a benefit from it is just a result of them being part of the whole, not a benefit geared specifically to that kind of entity or made to be exclusive of anyone/anything else.

Yossarian
4-17-12, 3:00pm
Of course they do. Benefits aren't just in dollars.

No distinction. All tax burdens are borne by and benefits accrue to people- employees, investors or consumers. Business is not something apart from people. To say something benefits "business" just means it benefits the people involved in or with that business.

bae
4-17-12, 3:05pm
To say something benefits "business" just means it benefits the people involved in or with that business.

But if you draw the distinction, then you can play divisive politics with "evil business" vs. "the people". Handy, that!

peggy
4-17-12, 3:39pm
Now where did I say business was evil? I never said that, or even implied it, but I guess 'reading between the lines' helps to further divide us and continue the wall between our common goals. Right/conservative victimization is such an easy card to play, you can pull that one out of the deck for just about anything you disagree with. Handy that!

Gregg- yes, they ARE a part of the whole. What benefits business benefits the country as a whole! It's all connected. We are all connected. When one part fails, we all fail, and when one part succeeds, we all succeed. Success doesn't have to always come with piles and piles of cash. And even though the part that fails may seem small (middle class family who after all don't have piles and piles of cash to buy the wealthy man's widgets) all together, the whole middle class, it does represent piles and piles of cash which the wealthy businessman needs to be successful.

Wanting a fair tax code isn't the same as saying business is evil. (although asserting that is sure useful for stopping conversation) And I'm smart enough to not be BS'd by the completely goofy mantra of 'poor corporation taxed so much we really need to give them a break cause they are job creators and all that cash has been taxed already (as if every dollar any of us has hasn't been taxed many times over)'. Did I cover them all? I won't even give space to the "Well I'll just take my money(ball) and leave the country (go home).

I just want what's fair. I want a strong economy, strong business and a strong middle class which keeps it all afloat. I know, and you know, the wealthy aren't selling useless widgets to each other. They need this strong economy to get and maintain their wealth. They benefit from a strong economy, and a happy workforce.
Doesn't it scare you even a little bit that the big corporations, who are now people, apparently with more power than any one person could ever imagine, are not only buying politicians to write tax code and laws that give them more while draining the middle class, are also backing the Republican drive to weaken the power of the workers/unions? It's not enough that they will win, but everybody else must lose!

txgran
4-17-12, 4:46pm
"Doesn't it scare you even a little bit that the big corporations, who are now people, apparently with more power than any one person could ever imagine, are not only buying politicians to write tax code and laws that give them more while draining the middle class, are also backing the Republican drive to weaken the power of the workers/unions? It's not enough that they will win, but everybody else must lose!"


Applause! Applause!

bunnys
4-17-12, 5:29pm
I know of no one proposing that the burden on the poor should be increased.


Post #11 in this thread called for the 49% of the population who currently don't pay income tax to begin coughing it up. That would include the poor, some of whom not only don't pay income tax but get an earned income tax credit.

I am against a flat tax because the wealthier one becomes the lower percentage of income must be spent on the necessities of life (food, shelter, health care, clothing, etc.) Because they have more disposable income (by definition income they can fritter away in any manner they choose,) I feel the fair thing is to expect them to pay a heavier burden in tax.

My belief is that when "defining" fair as many in this thread have inquired about, it is inherently more fair for those who make more money to be expected to pay more and a higher percentage of their income (regardless of how it is "earned") to taxes.

Ultimately this boils down to a philosophical difference between two camps and how they see "fair." One one side are those who believe that "fair" and "equal" are synonymous. On the other side is the camp that believes "fair" should be defined more closely with "best." Some people are really good at making money. Others are really good at sports or scholarly pursuits or engaging with other people. In life, it's naive to think that the playing field is equal for all. And it's not fair to hold those who aren't good at making money easily to the same standard as a person who finds it easy and even effortless to make a bunch of money, regardless of the circumstances.

It is folly to think that someone in one camp can convince someone in the other camp that their position is correct, regardless of how well though out and logical their arguments are. Just like it would be pointless for me to read a book written in a language other than English. I don't think that way and so I'm never going to be able to understand the other perspective.

ApatheticNoMore
4-17-12, 6:00pm
"Doesn't it scare you even a little bit that the big corporations, who are now people, apparently with more power than any one person could ever imagine,

Definitely. In fact people are simultaneously stripped of power by the repressive apparatus of the government (aware of, notice the civil liberties situation, what they have in mind for protestors etc.). So corporations are simultaneously empowered (all rights are theirs including infinite money funneling into the government) while people are scared.


are not only buying politicians to write tax code and laws that give them more while draining the middle class, are also backing the Republican drive to weaken the power of the workers/unions? It's not enough that they will win, but everybody else must lose!"

Exactly. They (the corptocracy - a select set of large corporations) win regardless. We have imperialist wars for oil regardless of who gets elected. Banks get bailed regardless of who gets elected. We have no real environmental policy regardless (though this one is less ingrained than the others). The real wins and the real system continues in the interest of a select set of businesses regardless, but then it's all about destroying a few ameliorative programs in the mean time which they don't really need to destroy because they can really continue on profitably without doing so, but hey might as well. And maybe that is where the repressive apparatus is needed, when you can no longer even buy someones compliance with the payoff of a puny safety net, then what?

Lainey
4-17-12, 9:07pm
Of course the people who scream about all those who "don't pay taxes" ignore the fact that a sizeable chunk of the non-tax-payers are retired and living off a relatively small social security income and students. In other words, people who DID pay taxes for most of their lives or those who WILL pay taxes most of their lives. .

This fact bears repeating. Often. So we can finally put this meme about the 47% who don't pay federal income tax in context: they don't pay because They Are Too Poor. Why is that something to be upset and jealous about?

jp1
4-17-12, 9:53pm
About 22%, or almost half, of the 47% is people on social security. And as Andrew SUllivan points out in this link, http://andrewsullivan.thedailybeast.com/2011/07/who-pays-taxes.html it's only federal income tax upon which 47% of the population doesn't pay taxes. The vast majority of those people still pay quite a bit of other taxes. Even people in the bottom 20% income-wise still pay 13% of their income in total taxes.

And while people at the lower end of the income spectrum pay less in federal income taxes, as figure 3 on the following link shows, the lower income earners actually pay more in state and local taxes as a percentage of income. Not to mention that only people at the very high end of the income spectrum pay less then average in payroll taxes (social security and medicare withholding) Figure 2 on this link. http://www.cbpp.org/cms/index.cfm?fa=view&id=3505

ApatheticNoMore
4-17-12, 10:46pm
This fact bears repeating. Often. So we can finally put this meme about the 47% who don't pay federal income tax in context: they don't pay because They Are Too Poor. Why is that something to be upset and jealous about?

Again it is not that easy, like I said California minimum wage, 40 hours a week, standard deduction, no kids, gets you in a position you CAN'T ESCAPE federal income taxes, not even with the earned income credit (and yet that *IS* poor, I'm definitely going to define living here on minimum wage as poor ok). Those who escape federal income taxes might be poor but claiming all the poor are escaping federal income taxes is just not true. I think people who criticize "people not paying taxes" think it's about poor people, but they are actually criticising deductions, since that is what makes the tax rate zero, just being poor is not going to do it.

mm1970
4-18-12, 3:57am
How many times should the same dollar be taxed? If you, as a partial owner of a company, invest your money in the form of stocks or bonds, which then generates a 10% annual return, should it be subjected to the highest corporate tax rate in the world prior to you receiving it only to then have it taxed again at a 25 to 30% rate? Exactly how many slices of the pie should the government take before you are allowed to enjoy the crumbs?
Well, that's the big question, isn't it? For me anyway.

WHEN is it the same dollar? If you invest $100 and you earn a 10% return, that $10 - is that the "same" money or is it NEW money? Right or wrong, the government mostly taxes you whenever money changes hands. So you earn your income and get taxed. You buy goods with that money and it gets taxed. You save the rest. Your savings get loaned to companies who make a profit and they (sometimes) get taxed. The companies pay their employees who pay income tax. Your savings net you a return and you get taxed on that.

You die and leave your money to your kids, but it changes hands (it's new money to them), so it gets taxed. When is it the same dollar and when is it a new dollar?

flowerseverywhere
4-18-12, 5:17am
well it has served one purpose, it has given more fuel to the partisan fire.

If it was passed, this would be a very small amount in relation to the bigger money picture. Like rearranging the deck chairs on the Titanic. Do something that might make a real difference in the long run.

mtnlaurel
4-18-12, 9:52am
Again it is not that easy, like I said California minimum wage, 40 hours a week, standard deduction, no kids, gets you in a position you CAN'T ESCAPE federal income taxes, not even with the earned income credit (and yet that *IS* poor, I'm definitely going to define living here on minimum wage as poor ok). Those who escape federal income taxes might be poor but claiming all the poor are escaping federal income taxes is just not true. I think people who criticize "people not paying taxes" think it's about poor people, but they are actually criticising deductions, since that is what makes the tax rate zero, just being poor is not going to do it.

Damn, I just looked up California Minimum Wage = $8/hr.
That's $64 a day. $320 a week. $16,640 Gross over 52 weeks in calendar year.

..... So blood CAN be squeezed from a turnip!

That's just not right to me.

Gregg
4-18-12, 10:27am
I am against a flat tax because the wealthier one becomes the lower percentage of income must be spent on the necessities of life (food, shelter, health care, clothing, etc.) Because they have more disposable income (by definition income they can fritter away in any manner they choose,) I feel the fair thing is to expect them to pay a heavier burden in tax.

I've never really been able to think of that approach as "fair" bunnys. First, knock out the extreme. If someone is below the point of being able to provide for themselves they won't pay taxes. Period. Moving on (with a somewhat oversimplified example, but you get the idea)...

Let's say I'm middle class and you are successful beyond your dreams. I make $100,000/year and you make $100 million. I spend 10% of my income ($10K) on food every year. Under your premise you would need to spend $10 million on food or you would be penalized. To take it all the way, what happens if you actually DID spend 10% of your income on food, just like I did. It certainly wouldn't be fair to penalize you then, would it?. What about other (Federal) expenditures? We both drive our cars on the same highways. Why should it cost you $10.00 in taxes for every mile you drive when it only costs me $.10? What about defense? Does the military do more to protect my house than it does yours? Probably not. Even under a flat tax you would be paying exponentially more for all those services than I would. If the flat tax was 15% I would be paying $15,000 per year and you would be paying $15,000,000. Do you think you would be deriving 1,000 time the benefits I would or could it be that you are, in effect, subsidizing the benefits I get? At what point do you guess you would get tired of doing that?




My belief is that when "defining" fair as many in this thread have inquired about, it is inherently more fair for those who make more money to be expected to pay more and a higher percentage of their income (regardless of how it is "earned") to taxes.

If I had a deer in the headlights emoticon I would insert it here. I absolutely agree that there is a symmetry to make more, pay more, but in terms of absolute dollars, not dollars AND percentage. This country provides a lot of opportunity to its citizens. Those that have the wherewithal to take advantage of it owe something for the opportunity. That is why an approach like a flat tax makes sense. If you want to make $100K or $100M you know that part of it will go toward supporting the opportunity you had for the next guy. And yes, under that plan the more you make, the more you pay. What I can not stomach is the Robin Hood approach of forcibly taking ever larger slices of someone else's pie as they become successful. Fair is to set the slice taken as the same size (percentage) for everyone. If your pie gets bigger so does the slice you hand over, but the approach of trying to make everyone's bite end up the same usually doesn't work out so well.

ApatheticNoMore
4-18-12, 11:47am
If it was passed, this would be a very small amount in relation to the bigger money picture. Like rearranging the deck chairs on the Titanic. Do something that might make a real difference in the long run.

What exactly would you propose, going after social security? Tax cuts are a large part of why we are in deficits. Now you might propose something like ending the wars (Ron Paul actually said he could massively reduce the deficits with no Social Security cuts). I would definitely agree with ending the wars, but I'm not sure even it is without economic consequences, see I think they have decided to conquest the whole middle east for oil for strategic reasons (really better than green energy and conservation? really? is it really really what we want? was the choice ever given? who bought out that choice - Exxon?) Maybe in order to save revenues abolish homeland security? That I would like to see :). Hey in order to save money on the deficits we would like to get rid of fascist policies ... wouldn't that be nice. But maybe even fascist policies are strategic :\ Anyway is anyone proposign this? (besides Paul)

Now to some extend the government may not need any of our taxes at all and can keep spending, when it can just print money afterall, but hmm .... it's doing it to some degree and well it did it for the banks (not TARP, what the Fed did).

loosechickens
4-18-12, 12:18pm
O.K. Sorry, folks.....having to do a major edit on this post because what I stated as a yearly amount is really what is likely to come in over ten years......post is now edited to be accurate.

Let's see. The same Republican Congressmen and commentators who are sneering at this 47 billion dollars over ten years that the Buffet rule would bring in to the Treasury, as though it's chump change, not enough money to even matter, etc., are the SAME folks who talked of a tiny percentage of that amount of dollars going to Planned Parenthood as a HUGE amount of money, a significant expenditure that the country simply couldn't afford.

So, perhaps a little "reframing" is in order. The money that the Buffet rule would bring in EVERY year, would be enough to fund many years of allocations to Planned Parenthood, you know, the ones that represented such a HUGE expenditure of taxpayer dollars every year, that we couldn't "afford". And since that money going to PP was considered SO significant an amount of money, perhaps that will help them realize just how useful the Buffet rule might be as a way of raising needed revenue, since it is so much in excess of that amount.

So, sometimes 47 billion dollars is just an insignificant dribble of money, and sometimes, something that is a tiny fraction of that amount is HUGE.........I guess everything really IS relative. Or how, exactly, one wants to frame thoughts about dollars.

And over, say, TEN years, or more, well that "chump change" that isn't going to make any difference supposedly, will add up to a LOT, unless you are one who throws around 47 billion dollars as just "insignificant" and the folks who are paying it wouldn't even notice the little burp in their balance sheets.

As someone said once.......you can fool some of the people all the time, and all of the people some of the time, but you can't fool all of the people all of the time, and the fooling that has been going on in these past few decades while the very richest of the rich have gathered ever more for themselves at the cost of the middle class, may be about to end.

flowerseverywhere
4-18-12, 1:07pm
What exactly would you propose, going after social security?

no. But a more balanced approach is in order. Not the smoke and mirrors of proposing ideas to get votes, especially when you know there is no chance they will get passed. Increasing taxes for the rich may not be a bad idea, however doing that and not reducing spending is.

You noted a lot of good ideas to decrease spending. The postal service is holding rallies now to protest stopping Saturday delivery. That would be a good idea as they operate at a deficit. Raising rates for junk mail to help the postal service.

what about duplicate services. " The GAO says the government might save tens of billions of dollars simply by eliminating duplicate and overlapping federal programs."

http://www.usatoday.com/news/washington/story/2012-02-27/GAO-report-duplicate-spending/53275924/1

wasteful government spending, the 2011 wastebook released by Sen. Coburn. Some of this might be funny if it wasn't so tragic. :

http://www.coburn.senate.gov/public//index.cfm?a=Files.Serve&File_id=b69a6ebd-7ebe-41b7-bb03-c25a5e194365

just like a household, city, state or business they need to figure out how to spend less.

Spartana
4-18-12, 1:07pm
From a piece on CNN (http://www.cnn.com/2012/04/16/politics/crowley-buffett-rule/index.html):

"A minimum 30% tax on million-dollar incomes won't do much to eat away at the nation's debt, it won't create jobs, and no one expects it to get through the Democratic-controlled Senate, much less the Republican-majority House."

So what do you think? A good rule with no support? A misguided attempt by people who really don't understand the economy? Is it now just the President's turn to play some election year politics?

Personally, I think it started out as the second and moved to the third. 60% of Americans disagree with me (Gallop: 60% support it, 37% oppose).

Haven't read all the posts yet, but I think the wealthy should pay taxes on the same scale and manner based on their income as everyone else with one (and only one) exception - job creation. If they can prove that they created X number of jobs in this country (no off shoring) to US citizens (no illegal aliens or foreign nationals) then they should get some sort of tax break. And I'm talking about "real" jobs, not just using their money as buying power for high end luxury goods and services as a means of "job creation". That doesn't cut it. It takes the same amount of labor to create a Rolls Royce as it does a Hyundai Accent. For the cost of buying one Rolls, you could buy dozens (hundreds?) of Hyundais thus creating many, many more jobs. Now I'll read all the posts!

flowerseverywhere
4-18-12, 1:12pm
O.K. Let's see. The same Republican Congressmen and commentators who are sneering at this 47 billion dollars per year that the Buffet rule would bring in to the Treasury, as though it's chump change, not enough money to even matter, etc., are the SAME folks who were talking of the 300 million dollars going to Planned Parenthood as a HUGE amount of money, a significant expenditure that the country simply couldn't afford.


LC, where did you get that number? Even over ten years it is big, however I found much lower numbers. And I don't dissagree with what you are saying.

http://www.reuters.com/article/2012/04/16/us-usa-tax-buffett-idUSBRE83F05H20120416
"The Buffett tax would raise $47 billion from 2012 through 2022 if imposed on taxpayers earning more than $1 million, or $500,000 for married individuals filing separately, according to a March memo from the Joint Committee on Taxation, a nonpartisan body that estimates tax changes for lawmakers."

bae
4-18-12, 1:19pm
It takes the same amount of labor to create a Rolls Royce as it does a Hyundai Accent.

Actually, I suspect you'd find that Hyundais are produced largely by robot labor, and relatively swiftly. Whereas a Rolls Royce has a huge number of hours of skilled hand labor involved in the production.

Spartana
4-18-12, 1:21pm
If we want to talk about fair share, how about we include those 49% of folks who don't pay income taxes AT ALL? The top 10% of earners pay 70% of all the taxes. How is that not fair?

Source: http://www.ntu.org/tax-basics/who-pays-income-taxes.html

If you are married, have several kids, write offs for home mortages, and for 401Ks or Trad IRAs even a middle income earner can get down to the zero % tax bracket.
Standard deductions alone are pretty high for many people with kids, and itemizing means even more write offs for most.

Standard Deductions:

2012 2011 2010 2009
Single $5,950 $5,800 $5,700 $5,700
Married filing jointly $11,900 $11,600 $11,400 $11,400
Married filing separately $5,950 $5,800 $5,700 $5,700
Head of household $8,700 $8,500 $8.400 $8,350

Personal exemption $3,800 $3,750 $3,650 $3,650

A dependent child can increase the standard deduction by $950 or the amount of earned income plus $300, whichever is greater. That increase has a maximum of $5,700.[/I][/B]

In addition there are many people who are retired who live off already taxed income from things like savings, Roth IRA, non or partially taxable Soc. Sec. benefits, etc... many have middle income levels but low or even zero % taxes. I am in this catagory in that I am in the zero % tax bracket this year (same as last year). Have a government pension that is only partially taxable (some of it was paid by me out of previously taxed income when working), a non-taxed disability pension from the VA, and previously taxed savings and bonds. So even though I have a income that would normally put me in a much higher tax brackett, I am able to pay no taxes at all (heck, didn't even have to file) because my write offs, combined with my standard deduction and personal exemption amount, meant I was below the taxable amount for both fed and state income taxes.

ApatheticNoMore
4-18-12, 1:27pm
no. But a more balanced approach is in order. Not the smoke and mirrors of proposing ideas to get votes, especially when you know there is no chance they will get passed.

It is a bit of an election year ploy. I have doubts it could get passed as well, though with a Dem congress maybe (yes I know at one point they had a Dem congress with this president). With a Rep congress and this president continuing the Bush cuts was signed off on, they just should have let those expire and we wouldn't even be debating this. But that said I don't think increased taxes on wealthier people are a bad idea, and no I don't think a 30% rate is extortionary, not even.


Increasing taxes for the rich may not be a bad idea, however doing that and not reducing spending is.

Are there really very many easy spending cuts? Well unless you go after the disaster that is the war on terror. Post 9-11 policy is a giant cluster, no doubt about it.


The postal service is holding rallies now to protest stopping Saturday delivery. That would be a good idea as they operate at a deficit. Raising rates for junk mail to help the postal service.

The postal service problems are an issue of their own. HOWEVER the postal service is not taxpayer funded so are there any real expenditures savings there? Anyway from the postal service side (and I haven't heard anything to refute it) they are going bankrupt because they are forced to fund 90 years worth of future employee medical services in 10 years. NO business operates under this, none of them. Do you think Fed Ex and UPS are under those obligations? No way the post office is being um I better lay off the term strategically, but yea deliberately bankrupted it seems. But again it's not a taxpayer issue one way or other.


what about duplicate services. " The GAO says the government might save tens of billions of dollars simply by eliminating duplicate and overlapping federal programs."

If the issue is just government waste, and really true waste, then eliminate it. Really who is against that, well actually every little fiefdom benefitting from it is against it but ...

I really truly don't think there is enough "waste" to bring the budget into better balance by just eliminating waste (unless you start considering most of our military budget waste, which frankly yes, but really EVEN THEN ...).

loosechickens
4-18-12, 1:44pm
It looks like you answered your own question, flowers everywhere. Sorry. I should have said ten years, which would make this "insignificant" amount only about 4.7 billion per year which still makes it maybe fifteen times the amount those same people said was a "huge" amount of money when they talked about PP. I am sorry. I read it wrong, but regardless, money is money so hard to believe that the same folks seem to value dollars differently depending on what they are talking about. No wonder our heads can't stop spinning.

Gregg
4-18-12, 2:01pm
My own question isn't so much regarding how much the Buffett Rule would generate as it is...

1. Is the means for generating that additional revenue a fair and moral way to do so? (Trying to be sure it is not a case of the end, or perhaps some even darker rationale, being used to justify the means.)

2. If revenue is increased will that lead to an equal or greater increase in spending?

A "NO" answer in either case will cause me to be in opposition to this "rule".

bunnys
4-18-12, 3:43pm
Even under a flat tax you would be paying exponentially more for all those services than I would. If the flat tax was 15% I would be paying $15,000 per year and you would be paying $15,000,000. Do you think you would be deriving 1,000 time the benefits I would or could it be that you are, in effect, subsidizing the benefits I get? At what point do you guess you would get tired of doing that?





Those that have the wherewithal to take advantage of it owe something for the opportunity...What I can not stomach is the Robin Hood approach of forcibly taking ever larger slices of someone else's pie as they become successful.

Gregg: Please realize I totally undersand your logic. I just don't agree with it.

Yes, you would be paying more of your income toward income taxes but you would but you wouldn't be paying exponentially more. For it to be exponentially more your percentage of income paid would have to increase at an exponential rate--as I understand math. Right? With your flat tax system, you'd be paying the same percentage as me, not exponentially more. And with my system, you'd only be paying exponentially more if the marginal tax brackets were set up in an exponential manner. We're not talking that here, we're talking just a few percentage points higher.

I was going to agree with you and say, "yes, I'd grumble and complain because nobody likes to pay more taxes, right? But I'd pay it because I'd believe the system would be set up fairly." But the more I think about it, I know I don't actually feel that way. Actually, I have no problem paying taxes because I like the benefits I (and all other Americans and our country in general) get from the government by paying taxes. I'm ok with it and I would be ok paying more taxes even knowing that the benefit wouldn't only be enjoyed by me personally.

I think your "wherewithal" point pretty much sums up the difference between our positions on this issue and illustrates my point about how useless it is for us to try to convince the other side that our respective position is the correct one. You believe people who don't make $100M per year only do so because they don't have the wherewithal to buckle down and pull themselves up by their bootstraps and get to work. I believe that's a small part of the reason people do well. I also KNOW the playing field is absolutely unequal and that it's naive and actually kind of a cop out to claim it is. The reality is that some people have many more advantages (intelligence, stable childhood, education, contacts) that pretty much set them up for success. From the very beginning some are set up for success and so because the likelihood they're going to succeed is greater, the should pay a higher percentage of their income.

Gregg
4-18-12, 6:57pm
I think your "wherewithal" point pretty much sums up the difference between our positions on this issue and illustrates my point about how useless it is for us to try to convince the other side that our respective position is the correct one. You believe people who don't make $100M per year only do so because they don't have the wherewithal to buckle down and pull themselves up by their bootstraps and get to work. I believe that's a small part of the reason people do well. I also KNOW the playing field is absolutely unequal and that it's naive and actually kind of a cop out to claim it is. The reality is that some people have many more advantages (intelligence, stable childhood, education, contacts) that pretty much set them up for success. From the very beginning some are set up for success and so because the likelihood they're going to succeed is greater, the should pay a higher percentage of their income.

Bunnys, I know we probably won't agree on this and I appreciate you understanding my logic. Truthfully, I'm trying hard to understand yours. Nothing you have said raised any hackles on me... until the paragraph above. Allow me to make a couple comments regarding that...

1. Please don't tell me what I believe. I will be happy to share that on my own.

2. The "wherewithal" to succeed includes a lot of things beyond just money. In fact money is well down the list of what it takes to succeed (if it makes the list at all). Sure, in some cases people use family money to get a head start. So? If my family would have had any I would have used it. In far more cases the ones who succeed have a drive and a willingness to keep going.

Success at all levels is usually the result of more than one star aligning, some you can control, some you can't. Being at the right place at the right time is not something that is handed out to the wealthy and withheld from the poor. If you take the time to talk to people you know who YOU consider successful I bet you will hear a lot more about their ambition and how they stuck it out than you will about privileged backgrounds. I bet a lot of them will tell you they got to the right place and hung on for the right time.

3. This whole concept of a level playing field is kind of absurd and completely unattainable. No two people are alike. No two people's situation is alike. No two people's parents, schools, neighborhoods, mentors, heroes, opportunities, incomes, expenses, bodies, taste buds, fingerprints, snowflakes, whatever. The playing field will NEVER be even. It makes no difference at all what your goal is, there will ALWAYS be someone who starts off closer to the target, and someone who starts farther away, than you did. There's no use wringing your hands about that because it will always be the case.

I won't even begin to say I understand the "from the very beginning" aspect of your comments as it relates to taxation, but I would certainly appreciate it if you would clarify that for me. As it reads now it almost sounds like you are proposing a caste system or a sperm tax or ??? I don't think that's really what you meant.

An example: I had dinner with two guys the other night. The first was from a moderately privileged background. Educated, professional parents, good schools all the way through, very upper-middle class. Compared to me and my farm raised, no college degree, very lower-middle class background this guy had the world on a string. The other guy, who we were both there to meet, is from the Republic of Namibia and was raised in the Namib Desert there. Let me tell you, I came out of the womb with life completely dialed in compared to this guy. So who was better off and who needed help?

The privileged fellow is a sales rep for a solar manufacturer. I started the company that's looking to help develop solar energy in Africa. The fellow from Namibia is the parallel there to the Secretary of Energy here. Each of us were presented with different opportunities starting at birth and we each chose radically different paths that happened to cross at dinner. I'm pretty sure none of our parents looked at us as toddlers and saw where we would be as adults. You just can't predict or control such things. Had we all started off at the same point I have no way of guessing where we would be now, but I'm pretty sure that really cool dinner would have never taken place.

Communism is the largest scale attempt to level the playing field. It doesn't work and it never will. I'm not saying you're a communist bunnys, I'm saying that trying to get everyone to the same starting line isn't the answer. What we need to do is find a way to make sure anyone with a desire is not hindered by the government and we need to be able to provide a safe, secure, comfortable environment for everyone else. We need to foster an environment that provides opportunity for everyone, but it doesn't always have to be the same opportunity in every single case. Even in Namibia, which makes rural Mississippi look like a Four Seasons, its all about opportunities. We need to provide them, but you have to remember that you can't control what people do with them. That's what the old saying about leading a horse to water is all about.

ApatheticNoMore
4-18-12, 7:39pm
I think it's incoherent to begin arguments on the basis of who had more advantages (not to deny that some have more advantages, I use the term priviledge at times, but I mean it narrowly (like just economically for instance). To figure this out in all realms would take omniscience! That a life of abject poverty is unlikely to be one with many advantages, yes we can go that far). It's as incoherent as thinking the marketplace is some grand reward machine perfectly metering out justice. Is that really a very scientific or economic view of the marketplace? (even a perfect marketplace which of course we dont' have). Figuring out whether wealth in general, in the abstract, was somehow deserved or not on some basis of justice just breaks down into incoherence. We've heard of laudable rich people, we've heard of scumbag rich people, we've heard of meh rich people, and anyway wealth only rewards a very narrow realm of human virtue even in the ocassional cases that the two coincide anyway!

It is best to argue for a welfare state on the basis of it benefitting many people (and generally the vast working majority), on the basis of even the poorest deserving to have *something* (in many realms) in this life (well why don't they?), on the basis of benefitting the larger society, on the basis of those who truly are downtrodden, on the basis of values beyond just the work ethic, on the basis if you are radical of all the deliberate advantages (and not some murky non-levelness) the rich have (we bailed the bankster rich, didn't we?), in some cases on the basis of all other retirement schemes failing (for the most part they probably will for most). Not on the phantom chasing of perfect justice somehow acheived by the welfare state OR the marketplace. That you will never have.

Yossarian
4-19-12, 8:33am
The reality is that some people have many more advantages (intelligence, stable childhood, education, contacts) that pretty much set them up for success. From the very beginning some are set up for success and so because the likelihood they're going to succeed is greater, the should pay a higher percentage of their income.

How does one distill this unfair advantage (as it must be "unfair" if it is "fair" to take away the proceeds) from personal effort and an appropriate level of reward for success?

bae
4-19-12, 11:27am
How does one distill this unfair advantage (as it must be "unfair" if it is "fair" to take away the proceeds) from personal effort and an appropriate level of reward for success?

Jeder nach seinen Fähigkeiten, jedem nach seinen Bedürfnissen.

LDAHL
4-19-12, 12:06pm
Jeder nach seinen Fähigkeiten, jedem nach seinen Bedürfnissen.

Of course, this paradigm requires an adequate ratio of ability to need to be sustainable.

mtnlaurel
4-19-12, 12:07pm
Jeder nach seinen Fähigkeiten, jedem nach seinen Bedürfnissen.

To save anyone else the Google-time, first hit from Wikipedia...
"From each according to his ability, to each according to his need (or needs) is a slogan (http://en.wikipedia.org/wiki/Slogan) popularised by Karl Marx (http://en.wikipedia.org/wiki/Karl_Marx) in his 1875 (http://en.wikipedia.org/wiki/1875) Critique of the Gotha Program (http://en.wikipedia.org/wiki/Critique_of_the_Gotha_Program).[1] (http://en.wikipedia.org/wiki/From_each_according_to_his_ability,_to_each_accord ing_to_his_need#cite_note-CGP_P1-0)"
http://en.wikipedia.org/wiki/From_each_according_to_his_ability,_to_each_accord ing_to_his_need

Gregg
4-19-12, 12:44pm
Of course, this paradigm requires an adequate ratio of ability to need to be sustainable.

And if I'm not mistaken the need typically grows at roughly the same rate at which the ability shrinks quickly destroying the delicate balance.

"While I see many hoof marks going in, I see none coming out. It is easier to get into the enemy's toils than out again."

Aesop - Just for something a little less...communistic.



ETA: And a personal favorite of mine...

"The more one considers the matter, the clearer it becomes that redistribution is in effect far less a redistribution of free income from the richer to the poorer, as we imagined, than a redistribution of power from the individual to the State."

Bertrand de Jouvenel

loosechickens
4-19-12, 2:51pm
I find myself amused that a discussion regarding whether or not immensely rich people, those with taxable incomes after all deductions of over a million dollars per year should pay at least as much of a percentage of their income as ordinary, middle-class working Americans. Especially when that 30% tax level would be far lower than the top tax bracket for ordinary wage earners in this country, and wouldn't even be affecting highly paid attorneys, doctors, etc., but only those really, really, really rich people who have the ability to arrange their investment income into everything from Swiss bank accounts, to Cayman Island corporations, to utilization of every possible tax avoidance loophole that could have been shoehorned into the tax code by politicians anxious for that next big campaign donation from the sugar daddies.........

Somehow goes almost immediately to..........."oh my God, the sky is falling in, the next thing you know, Karl Marx is coming......."

It's laughable, folks......and what is most laughable is that even the richest of us, (even bae, since he's indicated that he's given away a good part of his hundreds of millions), would even breathe the air with these people, who wouldn't even NOTICE that 30% bite of income taxes, when many middle-class and upper middle- class familes trying to put kids through college, etc., pay that much of a percentage of their income in Federal income taxes every year.

You'd think there would be a revolt among pretty well paid folks, who ARE paying these kinds of rates, as they watch folks with hugely larger incomes walking away paying far, far less of a percentage of their income than them. If I were a really well paid professional, say, pulling down four or five hundred thousand dollars a year working my butt off for that income, it would p*ss the heck out of me that Mitt Romney, with twenty or thirty MILLION dollars of income after all deductions, that just rolls in, was paying less than half the percentage of Federal income tax on that income, as me.

Ya gotta chuckle.....because one thing the Republican very, very rich are really good at is marketing. And they market their story very well.......anybody who thinks they should pay as much as a salaried person making a fraction of their income is a socialist, communist, admirer of Karl Marx, who just wants to take away from the "hard working" and give to the "freeloaders", and they manage to even get the people who ARE paying that 30% because they are actually out working and EARNING that money, rather than just sitting on the pile they have, not to mention all the ordinary people who pay through the nose themselves and struggle every day, to support these fat cat greed machines in their plans... (Sorry, but anyone who is immensely wealthy yet not willing to even pay a percentage in taxes as people with far, far, less income is greedy in my book)....Amazing......

ApatheticNoMore
4-19-12, 3:13pm
Really marginal taxes are beyond 30% for most working people now, take the 25% bracket and then you add on Social Security and Medicare taxes and you are well over 30 there, which I'd be ok with if Social Security and Medicare taxes were just funding that I suppose (and not the federal budget in general).

Alan
4-19-12, 3:34pm
I find myself amused that a discussion regarding whether or not immensely rich people, those with taxable incomes after all deductions of over a million dollars per year should pay at least as much of a percentage of their income as ordinary, middle-class working Americans. Especially when that 30% tax level would be far lower than the top tax bracket for ordinary wage earners in this country, and wouldn't even be affecting highly paid attorneys, doctors, etc., but only those really, really, really rich people who have the ability to arrange their investment income into everything from Swiss bank accounts, to Cayman Island corporations, to utilization of every possible tax avoidance loophole that could have been shoehorned into the tax code by politicians anxious for that next big campaign donation from the sugar daddies.........

I guess the point that no one seems to want to acknowledge is that those "immensely rich people" already are paying more than the 15% rate through the vehicle of double taxation at the source, which may equal as much as 50%. How much more should a gain on investment cost them?


Somehow goes almost immediately to..........."oh my God, the sky is falling in, the next thing you know, Karl Marx is coming......."
Because the shared principle between the two is the same. If you base your argument for higher taxation on the "richest of us.......... who wouldn't even NOTICE that 30% bite of income taxes", you're simply re-stating the Marxist Creed using populist hyperbole.


(Sorry, but anyone who is immensely wealthy yet not willing to even pay a percentage in taxes as people with far, far, less income is greedy in my book)....Amazing......
Didn't you regale us recently with the fact that your portfolio is steadily increasing in value, to the point that you could never spend all of it given your lifestyle, and that you still paid no federal income taxes this past year? Personally, I wouldn't call that greedy, but you may certainly disagree.

ApatheticNoMore
4-19-12, 3:39pm
Because the shared principle between the two is the same. If you base your argument for higher taxation on the "richest of us.......... who wouldn't even NOTICE that 30% bite of income taxes", you're simply re-stating the Marxist Creed.

I don't think Marx would have said anything like that.


Didn't you regale us recently with the fact that your portfolio is steadily increasing in value, to the point that you could never spend all of it given your lifestyle, and that you still paid no federal income taxes this past year? Personally, I wouldn't call that greedy, but you may disagree

I'd mostly call it horribly horribly unfair (the no taxes) - everything seems to depend on how expert the tax evasion advice you get is. If you have some great tax expert advising you, you don't pay taxes, and if not you get screwed in ways you didn't even know were possible. But the average middle class person tends not to have the divining rod or expertise to choose grand all knowing magical tax poobah wizard.

Midwest
4-19-12, 3:49pm
Ordinary wage earners pay don't pay anything near a 30% federal tax rate even if you include social security.

Family of 4, standard deduction, kids over 17, $60,000 gross income would pay $4,014 in federal tax. Federal tax of $4,014 based on taxable income after the standard deduction of $12,750 and their exemptions of $14,800. Effective tax rate 6.7%. If you add employee payroll taxes, you are 12%.

Same family with $30,000 in gross income pays 244 in federal tax (assuming they don't qualify for the earned income credit). If they qualify for the EIC, tax rate is negative. Without the benefit of the EIC, they pay 1% of their income in federal tax. Add the employee payroll tax, and their effective rate is 6.5%.

Those are the worst case scenarios for those families tax wise. If they itemize, qualify for various credits, etc, their tax rates will be even lower. None of these requires a magical tax accountant to achieve. Its just a fact that families under $60k pay very little in federal income tax.

ApatheticNoMore
4-19-12, 4:18pm
I usually end up paying around 25% of my overall income in taxes (marginally it's DEFINITELY over 40%) - but the 25% is overall (after the standard deduction and the exemption for myself) not marginal taxes - of course it does include state taxes which are not low here - so maybe only like 20% is going to the Feds. Single, no deductions beyond the standard. So tell me again how absolutely outrageous 30% is for the super rich?

LDAHL
4-19-12, 4:47pm
I don't think Marx would have said anything like that.

You're right. He would never have settled for 30%.

The Wall Street Journal has an interesting Karl (Rove, not Marx) piece today on the various arguments the president has made for the Buffet Rule over time:

1) We need the extra revenue to make "investments" that will create jobs.

2) We need the extra revenue to reduce the deficit.

3) Making rich people pay a greater percentage of thier income is "fair".

I could see how you might argue the first two propositions, although my understanding was that the total impact would be fairly marginal. I don't see how you could ever use the tax code to enforce fairness in the redistributionist sense. Government will never be able to resist adding complexity that can be exploited by people looking to minimize their tax liability.

ApatheticNoMore
4-19-12, 4:50pm
You're right. He would never have settled for 30%.

Really I'm not sure he would have wanted anything of the sort, more like worker control over the means of production :).

loosechickens
4-19-12, 5:42pm
I do NOT think it fair that we owed no Federal income tax this year, while a person with earned income of similar amount would have paid several thousand. Because we are NOT greedy is why I support changes that would not give such unfair preference to unearned income. It might be in MY interest, but it is not good for our country or fair to working people.

Alan
4-19-12, 6:30pm
Really I'm not sure he would have wanted anything of the sort, more like worker control over the means of production :).
No, it's actually the second 'plank' of his '10 Planks', memorialized in the Communist Manifesto. http://www.marxists.org/archive/marx/works/1848/communist-manifesto/ch02.htm

It's interesting to see how many of the 'planks' have already been instituted, in whole or part, in the United States and other western countries.

ApatheticNoMore
4-19-12, 7:24pm
I disagree that almost any have.


1. Abolition of property in land and application of all rents of land to public purposes.

no


2. A heavy progressive or graduated income tax.

this is debatable, and 30% is not heavy (based on what middle class people are already paying now!) and that's merely a proposal. A somewhat progressive income tax (with many loopholes) that we have, whose progressivity is somewhat offset by all the other regressive non-income taxation in existence.


3. Abolition of all rights of inheritance.

no, how heavy inheritance hits mostly depends on your ability to set up trusts I think


4. Confiscation of the property of all emigrants and rebels.

may have a point there. It is costly to leave, and property will be confiscated in drug raids and so on.


5. Centralisation of credit in the hands of the state, by means of a national bank with State capital and an exclusive monopoly.

We have a central bank, but we don't actually have the kind of central bank talked about here. Banks are not nationalized. Money creation is actually run through nominally private (bank of american, wells fargo, chase etc.) banks who profiteer from it. Now a lot of credit is government *backed* these days but even that throws off privitized profit (like the housing market, ginnie mae, fannie mac etc.). If you are looking for a word to best describe this, I think corporatism is the best word.


6. Centralisation of the means of communication and transport in the hands of the State.

tricky when the state was actually the main player in the invention of the major means of communication in the world today, so that's kinda a thorny problem in and of itself eh? Roads have long been public, Ike's fault for the interstate highway system?


7. Extension of factories and instruments of production owned by the State; the bringing into cultivation of waste-lands, and the improvement of the soil generally in accordance with a common plan.

erm? I suppose by some wild stretch something like emminent domain could be likened to the cultivation of waste-lands but it's a stretch. Of course soil is not improving.


8. Equal liability of all to work. Establishment of industrial armies, especially for agriculture.

not really, though we do have prison labor.


9. Combination of agriculture with manufacturing industries; gradual abolition of all the distinction between town and country by a more equable distribution of the populace over the country.

not really


10. Free education for all children in public schools. Abolition of children’s factory labour in its present form. Combination of education with industrial production, &c, &c.

to some degree yea

Anyway this conversation is so ridiculous at this point that I'm defending Marxism, which isn't actually anything I particularly favor. I think what is defendable to some degree is some European style welfare state measures, and also small scale socialism as in worker co-ops ala Mondragoon etc., and also unions.

loosechickens
4-19-12, 10:11pm
There hasn't been this much hysteria on the right about socialism, commies, Karl Marx, etc., since the days of ole Joe McCarthy, and I see that they are dredging up much of the same scare tactics, (and considering some of the folks touted by people like Glenn Beck), even the same people and books much lauded by the John Birch Society, etc. back then......

If we have ANYTHING in this country, it's about as far from socialism or Karl Marx, as it could be......we've been moving far more toward the dog eat dog social Darwinism of the very far right wing folks than anytime certainly in MY lifetime. I'd laugh, but it's serious.

Yossarian
4-19-12, 10:48pm
I find myself amused that a discussion regarding whether or not immensely rich people, those with taxable incomes after all deductions of over a million dollars per year should pay at least as much of a percentage of their income as ordinary, middle-class working Americans. Especially when that 30% tax level would be far lower than the top tax bracket for ordinary wage earners in this country, and wouldn't even be affecting highly paid attorneys, doctors, etc., but only those really, really, really rich people who have the ability to arrange their investment income into everything from Swiss bank accounts, to Cayman Island corporations, to utilization of every possible tax avoidance loophole that could have been shoehorned into the tax code by politicians

For the record I defended Kerry here when it came out that he and his immensely rich wife only paid about 14%. There were good reasons for it, but I guess it is always more fun to try to grab your pitchfork than use your brain.

Yossarian
4-19-12, 10:54pm
I do NOT think it fair that we owed no Federal income tax this year, while a person with earned income of similar amount would have paid several thousand. Because we are NOT greedy is why I support changes that would not give such unfair preference to unearned income. It might be in MY interest, but it is not good for our country or fair to working people.

Put up or.... :moon:

https://www.pay.gov/paygov/forms/formInstance.html?agencyFormId=23779454

And are you still claiming residency in that state tax haven?

bae
4-19-12, 11:33pm
... only those really, really, really rich people who have the ability to arrange their investment income into everything from Swiss bank accounts, to Cayman Island corporations, to utilization of every possible tax avoidance loophole that could have been shoehorned into the tax code by politicians anxious for that next big campaign donation from the sugar daddies.........


Hogwash.

While "everybody knows" that the wealthy take advantage of strange and mysterious "tax loopholes" and offshore bank accounts, that isn't reality, and hasn't been for ages. It's just another divisive myth, for the usual divisive reasons.

I have had access to simply the best tax attorneys on the planet. There are no such legal loopholes or evasive techniques of any real-world utility to most wealthy people. And you can take that to the bank.

I have asked on these forums time and time again for specific examples, and the only one usually offered is "oh, well, they can deduct 'paper' capital losses". Showing a distinct lack of understanding, methinks....

loosechickens
4-19-12, 11:45pm
Yep, we are still residents of that reddest of states, Texas, where ALL those far right, "business friendly", free market right wing ideas of governance hold sway. All the stuff you guys believe in most, shines brightly in Texas. If we give up our nomadic life, we will probably settle in CA, but since you pay CA tax based on your Federal return, probably not much would change except that we wouldn't be throwing our Presidential vote away. Not much chance President Obama will carry Texas, that wonderful example of right wing governance run amuck. ;-)

loosechickens
4-19-12, 11:49pm
Maybe you just need Dick Cheney's or Mitt Romney's tax attorneys, bae, and they can show you how to have tens of millions in income every year and pay less than 15 percent in Federal taxes. You may be paying way too much.

iris lily
4-20-12, 12:11am
... It might be in MY interest, but it is not good for our country or fair to working people.

Wait, so YOU may support issues that are best for the country but are not in your immediate financial self interest? Yet you malign voters in flyover country who do the same. You've said that many voters do not truly understand the issues because they vote against themselves, and you talk about them as if when they become informed or smarter they'd allow Nanny G to do what is best for them.

I guess it's ok that persons of superior intellect recognize issues that are best for the country as a whole and lobby accordingly, but poor fools in Kansas need to just give in to Nanny G who has only their best interests at heart. There's no accounting for their distaste of that teat.

loosechickens
4-20-12, 1:47am
You may miss the point, Iris Lily. It is possible that they may be both voting against their own self interest AND against the society and their country as well, after being shrewdly manipulated by a few emotional hot issues, like guns, gays and religion. And in the interest of a small handful of extremely self interested folks who would sell their country down the river without even blinking as long as the money and power is held in their hands. It's not rocket science. G'nite

bae
4-20-12, 2:17am
Maybe you just need Dick Cheney's or Mitt Romney's tax attorneys, bae, and they can show you how to have tens of millions in income every year and pay less than 15 percent in Federal taxes. You may be paying way too much.

Come now. It is trivial to arrange that, it's in the tax code, all simple and easy, with no smoke or mirrors required.

But that's not the sort of bogus mysterious tax loophole secrets the class warfare fans keep trotting out.

As you well know.

peggy
4-20-12, 8:35am
If it's so simple, bae, then why hire/gain access to armies of the best tax attorneys in the country? Anyone smart enough to amass great wealth surly can do a simple return with basic instructions. How many thousands and thousands of pages is the tax code? Surly there is one or two little loopholes tucked in there for which we hire armies of the best tax attorneys in the country.;)

flowerseverywhere
4-20-12, 9:02am
I am surprised at the level of personal attacks that are taking place here.

Don't a lot of states as well as the federal government give you a tax credit for certain things you invest in that are for the good of society? I am thinking historic preservation projects, low income housing, energy projects (like windmills) or other clean energy projects. Also, some people invest heavily when they do have income in tax free bonds. What about charitable deductions, too. If you have enough money you can donate a lot to charities. Even at my middle class income charitable deductions make a difference, although we are the middle class who pays tax.

I recently read a book by Neil strauss called "emergency" and he outlined how difficult it is for Americans to have offshore accounts and secret Swiss bank accounts today.

Gregg
4-20-12, 10:31am
There hasn't been this much hysteria on the right about socialism, commies, Karl Marx, etc., since the days of ole Joe McCarthy...

Hysteria is a little strong, at least if you get outside the sensationalist, fear monger media and go to the sources where average people speak their minds. Here, for example. My question is this LC, is it just possible that there is a valid reason so many folks are chiming in on this debate (nationally)? There are apparently millions of people who think there is. They can't all fit neatly into one of the caricature portrayals. Only a few could be great manipulators hell bent on ruling the world. A few more might be apathetic super-rich. None I know are zombies blindly following the landed gentry. None, to my knowledge, are inbred. Etc. Overall, it's just not a group of people that are generally slow on the uptake.

Yes, some of their (our) words have been heard before, but I would suggest your responses here are also delivered with a familiar drumbeat. It's worth stepping back a little and asking just what it was that raised the red flags. Are you really sure there aren't legitimate underlying issues that are making your opposition nervous and that it is nothing more than partisan paranoia? Dismissing the idea that "the state" is overstepping its authority is, at least according to much popular literature, what allows the state to do that very thing. The reason the watchdogs are cautious is because once you surrender any fraction of liberty its really costly to get it back.




Ya gotta chuckle.....because one thing the Republican very, very rich are really good at is marketing. And they market their story very well.......

It's true. Republicans are much better at marketing than Democrats. If the Dems were better they would immediately publish an extensive list of very wealthy donors who intentionally overpaid their taxes. You know, the ones who wrote that big 7 or 8 figure check over and above what they owed because their secretary paid more and the tax code just didn't offer any other way for them to chip in their fair share. It's a really long list....right?

ApatheticNoMore
4-20-12, 11:15am
I am surprised at the level of personal attacks that are taking place here.

yea really, now everyone is a Marxist.


Don't a lot of states as well as the federal government give you a tax credit for certain things you invest in that are for the good of society? I am thinking historic preservation projects, low income housing, energy projects (like windmills) or other clean energy projects. Also, some people invest heavily when they do have income in tax free bonds. What about charitable deductions, too. If you have enough money you can donate a lot to charities. Even at my middle class income charitable deductions make a difference, although we are the middle class who pays tax.

Actually it is VERY HARD to get charitable deductions to make a difference if it is your only itemization. You have to give A LOT to charity on a middle class income to do that. For single people the standard deduction was $5,800, $11,600 married. So .... if your single and give $6000 to charity have at it, or married and give $12,000 to charity. Most middle class people are not giving that much to charity (in fact it beats what many contribute to their own retirement accounts which of course aren't itemizable :( ). See what I mean most of these deductions only make any sense at all to the middle class if you are able to itemize.


Hysteria is a little strong, at least if you get outside the sensationalist, fear monger media and go to the sources where average people speak their minds. Here, for example. My question is this LC, is it just possible that there is a valid reason so many folks are chiming in on this debate (nationally)? There are apparently millions of people who think there is. They can't all fit neatly into one of the caricature portrayals. Only a few could be great manipulators hell bent on ruling the world. A few more might be apathetic super-rich. None I know are zombies blindly following the landed gentry. None, to my knowledge, are inbred. Etc. Overall, it's just not a group of people that are generally slow on the uptake.

Yes they may get a world with no government benefits, but I'm not sure most will actually like it when they do. Now there is plenty, plenty, of government involvement that I can do the unintended (only I suspect it's not) consequences analysis on. Like the government basically owns the housing market by now. Was that necessary? Were private (at least nominally private aka the banks) lenders really some horrible horrible thing for the housing market? I dont' think so. Was there perhaps some freezeup in lending, yea but more so, noone is going to lend at conditions that keep current housing prices (especially in bubble markets) propped up. Enter the government. Was this a bailout? Yes I think so. Ok but back to my point, the things that are going to get cut are ultimately not things like this, it's ultimately social security and so on. People will have a world that no tax revenue funds, but will they like it? The ultimate truth is most people have not saved enough to do retirement alone with no social security. A few may have pensions (oh the irony if the right wing charge to cut ends up being mostly cheered for by those with government jobs!! who aren't even making it in the private sector), most people even the savers (and many arent' savers), but even the savers will not likely end up accumulating enough on the only sometimes matched 401k and so on to do retirement alone. So how to you fund the government if noone is willing to pay taxes? 30% like I said is not much more than my only middle class income is paying, is somewhat progressive. Now if the entire charge to defund government was aimed: we'll do the least damage to the poorer people in society while doing so, then hmm, as in first we'll defund everything benefitting the richer people, these farm subsides to giant agribusiness they have to go first, department of energy subsidizies to fossil fuels have to go first, etc. etc.. Then I think the poor would still be hurt by government defunding but if at least the aim was to do the least damage to them while attaining libertopia it would be one thing. But that's not the way it is going to play out. In fact the average persons money has alrelady been stolen in so many ways but they dont' know. The BIG ENTITIES have ALREADY been bailed (the banks etc.) with money we did not have (on debt, on money creation). And now there will be nothing left for joe schmoe poor or middle class, and we'll make sure no taxes will even be paid so that there will be anything left.


Dismissing the idea that "the state" is overstepping its authority is, at least according to much popular literature, what allows the state to do that very thing. The reason the watchdogs are cautious is because once you surrender any fraction of liberty its really costly to get it back.

Where was the outcry on NDAA? Oh I know many people were against it in principle and that is good, but even then how much did they do? I'm sure a few did a lot, most did not do much. I wrote my congress people, the president, called them, went to a protest (in which everyone left etc. :( ). I didn't do enough, how many even did this? The ACLU is in one constant never ending battle for our civil liberties these days (and I don't just mean some lefty issues the ACLU may get involved in, I mean REAL civil liberties fights, on what I would almost universally consider civil liberties). How many know? How many care? But 30% taxes are the epitomy of government tyranny, reallly? Taxes especially very direct ones (not hidding somewhere 50 miles deep within the tax codes) even compared to another way the government takes your money (inflation and money creation) are benign. It's much easier to just plan to hand 30% over to the government in taxation than it is to plan for say hyperinflation or even long run ordinary run of the mill high inflation (hey maybe especially for the middle class but hey).

[ETA: social security and medicare are currently self-funded through payroll taxes though (and if the cap was raised on the income subject to Social Security taxation, Social Security could be self-funded under current conditions pretty much indefinitely. So then you ask what is worth still funding in the Federal government that isn't self-funded? Food stamps, unemployment, welfare, other general aid, regulation of environmental/worker protections, national parks, green policies (at current far outweighed by non-green policies), medicaid. I'm not sure this actually amounts to that much money. Minimal defense? Well fine it should be less than most other countries in the world pay for theirs since it's been overfunded for years, so drastic cuts.]

Midwest
4-20-12, 12:44pm
yea really, now everyone is a Marxist.



Actually it is VERY HARD to get charitable deductions to make a difference if it is your only itemization. You have to give A LOT to charity on a middle class income to do that. For single people the standard deduction was $5,800, $11,600 married. So .... if your single and give $6000 to charity have at it, or married and give $12,000 to charity. Most middle class people are not giving that much to charity (in fact it beats what many contribute to their own retirement accounts which of course aren't itemizable :( ). See what I mean most of these deductions only make any sense at all to the middle class if you are able to itemize.

Many middle class, however, are able to itemize and take full advantage of these deductions. If you have a house with a mortgage and/or live in a state with an income tax, you are probably itemizing.

With regard to your comment on retirement accounts, you don't itemize those because unless it's a roth, you aren't paying tax on them anyway. If your income is low enough, you even get a credit for those retirement contributions against your taxes.

If we want to fix the deficit, we need to fix spending and everyone needs to pay at least some income tax. The rich may, in fact need to have their rates raise. But, we also need some reforms at the other end of the spectrum.

When a significant part of the population pays no income tax, that's a problem. Despite assertions to the contrary in this thread, middle class people aren't paying 30% of their income in federal taxes.

The class warfare proposed by the buffet rule is simply a misdirection.

ApatheticNoMore
4-20-12, 1:31pm
When a significant part of the population pays no income tax, that's a problem. Despite assertions to the contrary in this thread, middle class people aren't paying 30% of their income in federal taxes.

Well I'm 20%. I just looked at a paycheck. So it came out to 19.6% I have paid so far of my income for federal taxes when you include SS and medicare (I am currently contributing 12% to my 401k - I don't expect anyone to be impressed by that, I'm not, I could do better :). But taxes would be higher without that). That's overall, not marginal. I consider my income middle middle class for living in California (it's not cheap to live here, I mean sure this income might be ALL THAT somewhere in the country but ...).

A 60k income for a family would not be easier to do here, it's doable, it's just tought. So if you want to rent a house that's 2k a month, 3k to buy. Noone on a 60k income has any business buying a house here (unless they have a good inheritence or something, then well sure, have at it). Sure you could rent a 1 bedroom for 1k, you want to raise a family in that? It's doable but if you go with the renting a house for 2k a month then maybe 500 a month in medical insurance to cover a family (and that's not the fanciest of plans). So your up to 1/2 your GROSS on housing and medical. Then are you saving anything, paying any taxes, food, car expenses etc.. Am I really supposed to be eaten up with envy if one of my neighbors is raising a family on 60k a year here and not paying a massive amount in taxes? It's not a great income, not for a family.

bae
4-20-12, 2:04pm
If it's so simple, bae, then why hire/gain access to armies of the best tax attorneys in the country? Anyone smart enough to amass great wealth surly can do a simple return with basic instructions. How many thousands and thousands of pages is the tax code? Surly there is one or two little loopholes tucked in there for which we hire armies of the best tax attorneys in the country.;)

A rather bold claim was made:


... only those really, really, really rich people who have the ability to arrange their investment income into everything from Swiss bank accounts, to Cayman Island corporations, to utilization of every possible tax avoidance loophole that could have been shoehorned into the tax code by politicians anxious for that next big campaign donation from the sugar daddies.........


These loopholes do not exist, nor are the foreign account evasion techniques legal (heck, my wife used to work for the FBI tracking down funds Very Bad People had squirrelled away in that manner...).

I ask for specifics, no response is given other than generalities of the form: "well, there must be!".

For those interested, go to the Intuit Turbotax web site to their free tax estimator:

http://turbotax.intuit.com/tax-tools/calculators/taxcaster/

Enter in the data for a married couple filing jointly, with no deductions at all, and $1 million dollars of dividend or long term capital gain income, and tell me how much tax that couple pays, and what the rate ends up being.... It will take you 60 seconds. I just did my own taxes, and it took mere moments to fill out the forms for this.

Now consider a second path: what happens if you invest in public-activity muni bonds...

You'd think Simple Living fans, who presumably have read and thought about "Your Money or Your Life" would know this stuff, it isn't rocket science.

Midwest
4-20-12, 2:34pm
Well I'm 20%. I just looked at a paycheck. So it came out to 19.6% I have paid so far of my income for federal taxes when you include SS and medicare (I am currently contributing 12% to my 401k - I don't expect anyone to be impressed by that, I'm not, I could do better :). But taxes would be higher without that). That's overall, not marginal. I consider my income middle middle class for living in California (it's not cheap to live here, I mean sure this income might be ALL THAT somewhere in the country but ...).

A 60k income for a family would not be easier to do here, it's doable, it's just tought. So if you want to rent a house that's 2k a month, 3k to buy. Noone on a 60k income has any business buying a house here (unless they have a good inheritence or something, then well sure, have at it). Sure you could rent a 1 bedroom for 1k, you want to raise a family in that? It's doable but if you go with the renting a house for 2k a month then maybe 500 a month in medical insurance to cover a family (and that's not the fanciest of plans). So your up to 1/2 your GROSS on housing and medical. Then are you saving anything, paying any taxes, food, car expenses etc.. Am I really supposed to be eaten up with envy if one of my neighbors is raising a family on 60k a year here and not paying a massive amount in taxes? It's not a great income, not for a family.

According to your check you are paying 20% which is a long way from 30%. I can back into the income required to do that and it's well above the median US household income of $50k. The claims in this thread insinuate the average middle class person is paying 30% in federal income tax is entirely wrong. Even a single person with no kids taking the standard deduction doesn't pay 30%.

I don't fault my neighbors living on $60k or those making a million. It's a lot easier, however, to go after those evil rich people than to admit that a significant portion of the populace pays no federal income tax at all. Many get a refund for taxes they didn't even pay due to refundable credits.

We have a huge deficit problem in this country and Obama's Buffet rule isn't the answer.

peggy
4-20-12, 3:06pm
yea really, now everyone is a Marxist.



Actually it is VERY HARD to get charitable deductions to make a difference if it is your only itemization. You have to give A LOT to charity on a middle class income to do that. For single people the standard deduction was $5,800, $11,600 married. So .... if your single and give $6000 to charity have at it, or married and give $12,000 to charity. Most middle class people are not giving that much to charity (in fact it beats what many contribute to their own retirement accounts which of course aren't itemizable :( ). See what I mean most of these deductions only make any sense at all to the middle class if you are able to itemize.



Yes they may get a world with no government benefits, but I'm not sure most will actually like it when they do. Now there is plenty, plenty, of government involvement that I can do the unintended (only I suspect it's not) consequences analysis on. Like the government basically owns the housing market by now. Was that necessary? Were private (at least nominally private aka the banks) lenders really some horrible horrible thing for the housing market? I dont' think so. Was there perhaps some freezeup in lending, yea but more so, noone is going to lend at conditions that keep current housing prices (especially in bubble markets) propped up. Enter the government. Was this a bailout? Yes I think so. Ok but back to my point, the things that are going to get cut are ultimately not things like this, it's ultimately social security and so on. People will have a world that no tax revenue funds, but will they like it? The ultimate truth is most people have not saved enough to do retirement alone with no social security. A few may have pensions (oh the irony if the right wing charge to cut ends up being mostly cheered for by those with government jobs!! who aren't even making it in the private sector), most people even the savers (and many arent' savers), but even the savers will not likely end up accumulating enough on the only sometimes matched 401k and so on to do retirement alone. So how to you fund the government if noone is willing to pay taxes? 30% like I said is not much more than my only middle class income is paying, is somewhat progressive. Now if the entire charge to defund government was aimed: we'll do the least damage to the poorer people in society while doing so, then hmm, as in first we'll defund everything benefitting the richer people, these farm subsides to giant agribusiness they have to go first, department of energy subsidizies to fossil fuels have to go first, etc. etc.. Then I think the poor would still be hurt by government defunding but if at least the aim was to do the least damage to them while attaining libertopia it would be one thing. But that's not the way it is going to play out. In fact the average persons money has alrelady been stolen in so many ways but they dont' know. The BIG ENTITIES have ALREADY been bailed (the banks etc.) with money we did not have (on debt, on money creation). And now there will be nothing left for joe schmoe poor or middle class, and we'll make sure no taxes will even be paid so that there will be anything left.



Where was the outcry on NDAA? Oh I know many people were against it in principle and that is good, but even then how much did they do? I'm sure a few did a lot, most did not do much. I wrote my congress people, the president, called them, went to a protest (in which everyone left etc. :( ). I didn't do enough, how many even did this? The ACLU is in one constant never ending battle for our civil liberties these days (and I don't just mean some lefty issues the ACLU may get involved in, I mean REAL civil liberties fights, on what I would almost universally consider civil liberties). How many know? How many care? But 30% taxes are the epitomy of government tyranny, reallly? Taxes especially very direct ones (not hidding somewhere 50 miles deep within the tax codes) even compared to another way the government takes your money (inflation and money creation) are benign. It's much easier to just plan to hand 30% over to the government in taxation than it is to plan for say hyperinflation or even long run ordinary run of the mill high inflation (hey maybe especially for the middle class but hey).

[ETA: social security and medicare are currently self-funded through payroll taxes though (and if the cap was raised on the income subject to Social Security taxation, Social Security could be self-funded under current conditions pretty much indefinitely. So then you ask what is worth still funding in the Federal government that isn't self-funded? Food stamps, unemployment, welfare, other general aid, regulation of environmental/worker protections, national parks, green policies (at current far outweighed by non-green policies), medicaid. I'm not sure this actually amounts to that much money. Minimal defense? Well fine it should be less than most other countries in the world pay for theirs since it's been overfunded for years, so drastic cuts.]

+1
People just don't realize what this country would look like without government benefits. Roads, schools, libraries, food safety, police, fire, etc....is all government benefit. And of course medicare, medicaid, SS are the big ones most think of when they think of government benefits.
Unfortunately, the meme of 'evil government' is an easy one to pull out for the low information voter audience who usually is the target of this advertising. That's where we get the tea party pictures of signs saying 'keep the government out of my medicare' and the like. They are fed, then regurgitate the evil government mantra without a defined enemy. Just 'big government'. But if you ask them if the upgrade to the old highway they drive on everyday is evil, or if the library or local grade school is evil, they would likely look at you as if you were crazy. Is the county extension agent evil? The park rangers? All these cost money. Lots and lots of money.
This is a 21st century nation, being run on last centuries dollars. Sure, we can cut some areas, but we need to raise taxes too if we want to continue to enjoy what we have enjoyed so far, at the level we have enjoyed it, which in my opinion is fine. I'm an American living in America. I expect, as most other Americans expect, a certain standard of living. That's what makes America great, and the envy of the world.

flowerseverywhere- we are pretty used to being called Marxist, or fascists, or nanny liberals whenever 'some' have no better argument. We just pretty much ignore it, and realize most of these folks would never say something like this to our faces. It's a political discussion and often those can get heated, although i haven't really seen any 'unbelievable' attacks in this discussion.

ApatheticNoMore
4-20-12, 3:12pm
According to your check you are paying 20% which is a long way from 30%.

It's called progressivity in the tax code and it's not extreme progressivity - me 20%, a millionaire 30%. I mean you know to only go up 10% in brackets from that huge a jump in income, that is what I call very mildly progressive. A steeper curve would be top brackets as they have been historically.


I can back into the income required to do that and it's well above the median US household income of $50k.

Median incomes in many parts of California tend to be, the same way in some expensive east coast cities (notably New York but even Boston etc. isn't super cheap).


The claims in this thread insinuate the average middle class person is paying 30% in federal income tax is entirely wrong. Even a single person with no kids taking the standard deduction doesn't pay 30%.

Well I said 20% is acheived easily, trust me low level managers I had were earning FAR more than me. Loose was making the claim about people earning a lot from wages, and yes you can be taxed a lot from making a lot from wages.


We have a huge deficit problem in this country and Obama's Buffet rule isn't the answer.

Part of it?

You know actually I don't have a dog in the fight as far as deductions since I never get any. So which one should we get rid of - the housing deduction or the deduction for kids or both? Which one of those should we eliminate as the answer to our deficits? But you know I'm not as as purely self-centered as all that, I realize it does cost some money to raise kids (but at the same time we should not be encouraging excess population - so maybe cap out at replacement rate - 2 kids?). I have heard the budget could be a lot closer to balanced if all deductions were eliminated which seems to be the policy most people want rather than 30% taxes on millionaires, they would rather get rid of all their deductions (since complaining about people not paying is ultimately complaining about deductions - since like I said a person without kids or deductions earning minimum wage still owes taxes - they eke a little blood out of even that stone). Ok I can live with no deductions clearly. Can they?

By the way even using deductions to lower income below paying much taxes can only be done to some degree in a certain income range, beyond that it's go straight to the AMT, do not pass go. The AMT is catching a lot of non-rich people now.

flowerseverywhere
4-20-12, 4:54pm
we are close to the median household income and paid less than 9% in federal taxes, but we do have state income and property taxes.

Bae, your example was interesting- it still is a lot of money.

Peggy, it may be different in other areas but here our library is funded by all the people who live in our school district. Everyone pays a few dollars. There are fundraising efforts, and almost $38,000 from fees and fines (stupid tax)

There is a great book out I referenced before "emergency" by Neil strauss. He outlines how he tries to get citizenship in another country so he can have swiss bank accounts and meets lots of wealthy people doing the same. Also, we have some friends who tried to get us to invest in some gas leasing deal. We read the glossy brochures but didn't undertstand it and we don't have the money to invest in such stuff but there were some tax breaks associated with it under new energy tax breaks. And like bae said, some people have invested in tax free bonds for one.

There is a huge difference between legal tax avoidance and illegal tax evasion.

Gregg
4-20-12, 5:53pm
There is a huge difference between legal tax avoidance and illegal tax evasion.

It seems like that would be a little more obvious that it apparently is. Thanks for making it clear flowers.

bae
4-20-12, 6:02pm
It seems like that would be a little more obvious that it apparently is. Thanks for making it clear flowers.

"Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant" Justice Learned Hand, Comm’r v. Newman, 159 F.2d 848, 850–51 (2d Cir. 1947)

ApatheticNoMore
4-20-12, 6:11pm
I'm skeptical most people really know what to do to minimize tax liability. Really dont' make any major financial moves without consulting tax advisors, you are probably doing it wrong.

bae
4-20-12, 6:25pm
I'm skeptical most people really know what to do to minimize tax liability. Really dont' make any major financial moves without consulting tax advisors, you are probably doing it wrong.

Well, to be fair, a significant portion of the US population believes that the motions of the planetary bodies influence their individual fates, or in UFOs, or ESP... So it isn't terribly surprising to me that some folks have a hard time doing their taxes, even with Turbotax holding their hand.

ApatheticNoMore
4-20-12, 6:30pm
Well do Turbotax BEFORE each financial move (after is too late), even then you have to know that you may be subject to things you never thought you would ever be subject to and didn't know about.

bae
4-20-12, 6:37pm
Well do Turbotax BEFORE each financial move (after is too late), even then you have to know that you may be subject to things you never thought you would ever be subject to and didn't know about.

Perhaps this is indicative that some sort of radical simplification of the overly-complex tax code is in order...

Gregg
4-20-12, 6:47pm
Perhaps this is indicative that some sort of radical simplification of the overly-complex tax code is in order...

There is a certain elegance to 15% of all income received by anyone above the poverty line. But that's just me, I love one line answers to essay questions.

Yossarian
4-20-12, 7:40pm
"Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant" Justice Learned Hand, Comm’r v. Newman, 159 F.2d 848, 850–51 (2d Cir. 1947)

It's worse than that. Hand's quote is usually employed in the context of structuring transactions that take advantage of favorable rules. The pitchfork crowd is really worked up over basic tax policy, but they are ironically ignorant or callously mislead. As you fairly pointed out, some people's tax rate is lower simply because they earn income that is taxed at a lower rate, not that they employ some nefarious tax scheme (note to LC, income earned in a Swiss bank account or a Cayman partnership is taxable in the US the same as if the money was held in a US entity, and no one is defending tax fraud). But there are typically reasons why there is a lower rate. Yes Kerry held a bunch of tax exempt bonds, but there is an additional economic tax implicit in the lower interest rate you get from them. Yes dividends (currently) and capital gains are taxed at a lower rate, but they bear some additional indirect payment through the double tax system that puts the economic tax rate much higher. The tax code is actually full of rules that distort capital allocations AWAY from dividends, even at 15%, because people who have a choice and employ those evil tax planners know that and try to avoid the very income that uninformed get worked up over. Yet some people would prefer to wallow in demagoguery about the nominal headline rate without addressing the substance.

Lainey
4-20-12, 7:56pm
. As you fairly pointed out, some people's tax rate is lower simply because they earn income that is taxed at a lower rate,.. But there are typically reasons why there is a lower rate. .


They have better lobbyists.

bunnys
4-20-12, 8:53pm
How does one distill this unfair advantage (as it must be "unfair" if it is "fair" to take away the proceeds) from personal effort and an appropriate level of reward for success?

That's impossible. There is no way an equation could be developed to measure personal effort.

But the comment you quoted was not stated clearly. I should have added to the end, "tied to their level of success."

I am arguing that those who earn more income should pay a higher percentage of their income to taxes in part because a lower percentage of their income is necessary for them to pay for the necessities of life and they have more disposable income. Additionally, I just think it's ethically right for those who benefit from our economic system to contribute to making life a little less difficult for those don't benefit from it. If I didn't feel that way I would say that as a nation we should dismantle ALL social welfare programs and all regulations passed curb the natural tendancies of business that were passed during the Progressive Era.

Would you want to eliminate all Social Security, minimum wage, workplace safety, child labor laws and welfare and just let business go wild doing whatever they wanted unchecked to make money? If not, where would you draw the line? Isn't any line arbitrary?

I am of the Robin Hood camp. And unapologetic about it. But let's be clear here. This is not about communism or socialism or killing the work ethic. No one is proposing anything even close to that. I just want to raise taxes a few percentage points on the wealthiest people in our society. And I don't think that families living below the poverty level should be required to pay any income taxes.

bunnys
4-20-12, 9:38pm
Bunnys, I know we probably won't agree on this and I appreciate you understanding my logic. Truthfully, I'm trying hard to understand yours. Nothing you have said raised any hackles on me... until the paragraph above. Allow me to make a couple comments regarding that...

1. Please don't tell me what I believe. I will be happy to share that on my own.
I was stating what you believe based on the arguments you presented earlier. Was I wrong to assume that you were arguing your own position? You were offended that I presumed to state what you believe. For that I apologize. Are we going to argue the points of the issue or bristle indignantly because of semantics?

2. The "wherewithal" to succeed includes a lot of things beyond just money. In fact money is well down the list of what it takes to succeed (if it makes the list at all). Sure, in some cases people use family money to get a head start. So? If my family would have had any I would have used it. In far more cases the ones who succeed have a drive and a willingness to keep going.
I didn't say wherewithal meant money. I said it meant will, grit, discipline and much bootstrap pulling-up. Yeah, it's great that some richies can use family money to get a head-start. Too bad those children of crack-addled mothers whose fathers were killed before they were born and who were raised without one good adult role model to keep them from dropping out of high school didn't just have more drive even if they don't have more family money.

Success at all levels is usually the result of more than one star aligning, some you can control, some you can't. Being at the right place at the right time is not something that is handed out to the wealthy and withheld from the poor. What evidence are you basing this claim on? My entire point is that all those things I listed in my earlier post (education, stable childhood, etc.) are exactly what amount to the "right place at the right time." If you don't feel this way, how do you define the "right place at the right time?" If you take the time to talk to people you know who YOU consider successful I bet you will hear a lot more about their ambition and how they stuck it out than you will about privileged backgrounds. I bet a lot of them will tell you they got to the right place and hung on for the right time. I can prove any point I want if I rely on anecdotal evidence to make that point. That doesn't mean my point is true for anyone beyond me and my example.

3. This whole concept of a level playing field is kind of absurd and completely unattainable. No two people are alike. No two people's situation is alike. No two people's parents, schools, neighborhoods, mentors, heroes, opportunities, incomes, expenses, bodies, taste buds, fingerprints, snowflakes, whatever. The playing field will NEVER be even. It makes no difference at all what your goal is, there will ALWAYS be someone who starts off closer to the target, and someone who starts farther away, than you did. There's no use wringing your hands about that because it will always be the case. I am not suggesting we should pretend that we're going to level the playing field so everyone can have an even shake. But I do think we should try. I do believe in Affirmative Action. I do believe in Head Start. I do believe in the Pell Grant. I believe in plenty of those types of programs. The playing field is NOT level. But we can try and even out some of those peaks and valleys. But let's also try to make up for that inherent unfairness by making the people who are richest pay more.

I won't even begin to say I understand the "from the very beginning" aspect of your comments as it relates to taxation, but I would certainly appreciate it if you would clarify that for me. As it reads now it almost sounds like you are proposing a caste system or a sperm tax or ??? I don't think that's really what you meant. No, I mean from their infancy when I say "from the very beginning." They've had advantages their entire lives.

Communism is the largest scale attempt to level the playing field. It doesn't work and it never will. I agree, communism kills the profit motive. I fully believe in limited capitalism. I'm not saying you're a communist bunnys, No, I'm not a communist. But why are you even bringing that up as a possible explanation for my ideas? What I'm suggesting doesn't even come close to communism. I'm saying that trying to get everyone to the same starting line isn't the answer. I've said several times that I don't think this is possible. Why do you still think I think this? What we need to do is find a way to make sure anyone with a desire is not hindered by the government (I think we need to use government to protect workers from exploitive business. I have no worries whatsoever that business isn't going manage to make a profit unless government gets out of the way. But this isn't really part of the original discussion.) and we need to be able to provide a safe, secure, comfortable environment for everyone else. We need to foster an environment that provides opportunity for everyone, but it doesn't always have to be the same opportunity in every single case. Even in Namibia, which makes rural Mississippi look like a Four Seasons, its all about opportunities. We need to provide them, but you (do you mean me personally? Or are you saying "one?")have to remember that you can't control what people do with them. That's what the old saying about leading a horse to water is all about.

Hey Gregg: As I said in the beginning we aren't coming from the same place and there is no way you're going manage to convince me of your position or that I will be able to convince you of mine. Although I do think we both did an admirable job of explaining our positions to each other.

Ulitmately, I think the difference here lies in the fact that you and I come from philosophically seperate camps that look at the world in profoundly different ways. That's ok.

Hope my voice above wasn't too harsh. You said you were a little put off by my earlier comments so I really don't want you to bristle further. However, the nature of this kind of discussion often does lead to that, huh? It's been interesting talking with you about this.

loosechickens
4-20-12, 10:53pm
I dont think any of those folks NEED to resort to tax fraud. When you are the ones with the campaign money, access and clout, you just see to it that the tax rules that benefit YOU and folks like you become legal and written into the tax regulations. When you can control what legal IS, you have no problems.

dmc
4-21-12, 8:03am
I'm one that is also in favor of a flat tax. And do away with all the deductions. No mortgage, kid, charity, ect. If you make a dollar, pay a percentage to run the government. And I mean everyone. Maybe if everyone paid there would be a little more interest in the amount of government spending.

Yossarian
4-21-12, 8:54am
I just think it's ethically right for those who benefit from our economic system to contribute to making life a little less difficult for those don't benefit from it.

I can go along with making sure people who can't do well are taken care of, but IMHO your ideas of reallocation based simply on outcomes lacks the morality you think they do. We aren't talking ethics of caring for your neighbor, you are endorsing violence to reallocate the fruits of labor without any justification other than the desire for someone else's stuff.

Yossarian
4-21-12, 9:07am
I dont think any of those folks NEED to resort to tax fraud. When you are the ones with the campaign money, access and clout, you just see to it that the tax rules that benefit YOU and folks like you become legal and written into the tax regulations. When you can control what legal IS, you have no problems.

I wish I could create one of those online counters so I could track the number of times you've been asked for specifics on this and you have simply given insubstantial rhetoric. This is a smart crowd here, we can get past some meaningless campaign tripe. So what are these great tax rules that you are referring to? And don't say dividend rates, because there are lots of places in the tax code that push people into dividends- and they have to be pushed because it's a horrible tax result that people with access to planning and choices run from.

I think things like the step up at death might be a fair issue, but that doesn't affect your annual rate which is the topic at hand. From a budget point of view the big issues are really things like the healthcare exclusion, mortgage interest deduction, retirement savings exclusions, but those don't really fit your narrative since they are widely accessed. So please save us the meaningless tin foil had stuff and honor us with some specifics.

flowerseverywhere
4-21-12, 9:23am
I dont think any of those folks NEED to resort to tax fraud. When you are the ones with the campaign money, access and clout, you just see to it that the tax rules that benefit YOU and folks like you become legal and written into the tax regulations. When you can control what legal IS, you have no problems.

when I read your quote it brought me back to when I was a child in the 50's. My mother used to tell us "the rich get richer and the poor have children. The only way to get ahead is to have a profession. If you have children without being married to someone who has a decent job you are resigning yourself to a life of poverty. If you have money you can have great influence in how your own life will turn out. Never take on debt except to buy a house"
I only knew one person who was divorced when I was a child and you did not have children unless you were married to their father. Or you married their father. You took care of your family.

Somewhere this message got lost.

The war on poverty has failed. More people are in poverty than in the 60's when these social programs really increased. We need to do something different because all these social programs are not working.

There will always be rich people and always poor people. Unless we put all the money in a pot and divvy it up it's the way it is going to be.

Gregg
4-21-12, 12:08pm
I am arguing that those who earn more income should pay a higher percentage of their income to taxes in part because a lower percentage of their income is necessary for them to pay for the necessities of life and they have more disposable income.

The average grade in our schools is a "C". If all students who put forth the effort to get straight "A" report cards would simply hand over an appropriate percentage of their work to all "F" students then everyone would have a "C" and we would all be much happier.




Additionally, I just think it's ethically right for those who benefit from our economic system to contribute to making life a little less difficult for those don't benefit from it. If I didn't feel that way I would say that as a nation we should dismantle ALL social welfare programs and all regulations passed curb the natural tendancies of business that were passed during the Progressive Era.

Would you want to eliminate all Social Security, minimum wage, workplace safety, child labor laws and welfare and just let business go wild doing whatever they wanted unchecked to make money? If not, where would you draw the line? Isn't any line arbitrary?

I find it extremely ironic that in one paragraph you talk about "those (who) don't benefit from (our economic system)" and in the very next paragraph you put forth a laundry list of benefits provided to every member of our society specifically derived from our economic system. Your list covers multiple items that are provided to workers, the members of society who actually contribute. It also lists one blanket term, "welfare", through which those who do contribute support those who can't/don't/won't.

There are countless benefits provided to ALL members of our society by the government that are available to people regardless of their level of contribution. National parks, a strong national defense, access to airports, representation, the Strategic Petroleum Reserve, Fannie Mae & Freddie Mac, Department of Energy Grants, the Center for Disease Control, the National Oceanic and Atmospheric Administration, the interstate highway system, the Federal Reserve, FEMA, the Small Business Administration, Medicare/Medicaid, the Supreme Court, public education and on and on and on. ALL of those programs and thousands and thousands more are FULLY SUPPORTED by people who take advantage of our economic system and then pay their taxes. They are all made available to ANYBODY in this country, even those who pay nothing in taxes and so do not support the programs. It is egregious to say there are people in this country who do not benefit from being here.




I am of the Robin Hood camp. And unapologetic about it.

It's that first seemingly innocuous little word in "take from the rich and give to the poor" that is the problem. Take. To get into one's hands, possession, control, etc., by force or artifice: to take a bone from a snarling dog. To seize or capture: to take an enemy town; to take a prisoner. There are many examples of governments that elected to take legally acquired assets from its citizens by force, through legislation or otherwise. If you take a close look I'm not sure the desired outcome was achieved in any of those cases. But I'm sure it will be different this time.

Alan
4-21-12, 12:19pm
The average grade in our schools is a "C". If all students who put forth the effort to get straight "A" report cards would simply hand over an appropriate percentage of their work to all "F" students then everyone would have a "C" and we would all be much happier.


750 (Sorry for the small image, click on it for a larger version)

ApatheticNoMore
4-21-12, 12:34pm
750 (Sorry for the small image, click on it for a larger version)

Yes, life is just like a schoolroom, well for some people I guess. Those who say grades are a way to instill constant competition even in early life may have a point though. Remember always seek extrinsic motivation, it tends to lead to actual dislike of anything you have to do that's purely extrinsicallly motivated (even in those cases when it is not in itself dislikable) but ...

The thing about doing well in school is it doesn't even map all that well to sucess in the real world. It conditions people, but conditions them to what?

creaker
4-21-12, 12:51pm
The average grade in our schools is a "C". If all students who put forth the effort to get straight "A" report cards would simply hand over an appropriate percentage of their work to all "F" students then everyone would have a "C" and we would all be much happier.

As another scenario they could also just sell the highest grades to the highest bidders and let the rest of the students scramble for whatever grades are left.

Alan
4-21-12, 12:56pm
Yes, life is just like a schoolroom, well for some people I guess. Those who say grades are a way to instill constant competition even in early life may have a point though. Remember always seek extrinsic motivation, it tends to lead to actual dislike of anything you have to do that's purely extrinsicallly motivated (even in those cases when it is not in itself dislikable) but ...

The thing about doing well in school is it doesn't even map all that well to sucess in the real world. It conditions people, but conditions them to what?
But of course the discussion is not about schoolrooms, unless as an example of 'fairness' or 'spread the wealth' run amuck.

Alan
4-21-12, 12:59pm
As another scenario they could also just sell the highest grades to the highest bidders and let the rest of the students scramble for whatever grades are left.
Or, you could also encourage students to do their best and have their grades reflect their abilities rather than their desires. You might even consider a good grade to be a reward for excellence rather than mediocrity.

Radical, I know.

ApatheticNoMore
4-21-12, 2:40pm
The war on poverty has failed. More people are in poverty than in the 60's when these social programs really increased.

How can you even compare America circa 2012 to America circa the 60s? Loss of manufacturing base, union jobs, jobs for people without degrees (and I guess now many with) ... all this is nothing? I mean at least America circa 1960 and 1980 was closer (close but not really). And I very much doubt a lot of money is spent on the poor. A lot of money *IS* spent on medicare and social security, which do reduce poverty, but not much is spent on programs exclusively for the poor (a fraction of what is spend on bankster and corporate bailouts I'm willing to bet).

If you are actually are dealing with deep behavioral patterns, man noone knows how to change those. Really. A better society wouldn't hurt :) But at this point more and more people are falling into poverty (do ALL of them have deep seated problems?).


We need to do something different because all these social programs are not working.

Mostly have been cut to the bone anyway, that was Clinton's welfare reform.


There will always be rich people and always poor people.

Actually I don't think very many people really disagree with this as such.

But the middle class, what remains of it, has a giant target on their back and is going down, but they think they have no stake in the game. Hmm.

loosechickens
4-21-12, 2:46pm
I'm honestly sick of this whole subject. And, no, I'm not going to spend hours Googling to buttress what I've said here. Most of us know it is true, because we feel it in our lives, and those whose ideological views are more in the dog eat dog view will always have wonderful talking points to muddy the waters. But the truth is that a LOT has changed in this country in the past thirty years, really since conservatives have gained power, from Reagan, on. And most of the actual growth in wealth and income during those years has gone to the very richest of the rich, who are the people who pull the conservative strings, despite the fact that a number who follow them don't really realize that, or somehow think that someday they are going to join them.

I give you this. It's an excellent picture of how, factually, the middle class is being hollowed out by these conservative ideas, that have been kicking around and gaining traction in recent decades. And, then, I'm off.......because real life is out here being wasted while I'm in here hitting my head against a proverbial brick wall. Those who might actually be interested in understanding what has happened in this country in recent decades, can click here. Those of you who believe wholeheartedly in that "free market", "cream rises" world, keep on keeping on, I guess.

http://currydemocrats.org/american_pie.html

bae
4-21-12, 3:31pm
Most of us know it is true, because we feel it ...

When I see folks repeatedly falling into the use of thought-terminating cliches, refusing to address refuting information, refusing to provide specifics, relying on handpicked examples and nonrepeatable experiments, being unwilling to test, and using all the other shop-worn techniques of distraction and avoidance, I know I am dealing with people who have been inculcated with a belief system, and factual honest open discourse is of no further use.

Lainey
4-21-12, 4:02pm
When I see folks ... refusing to provide specifics...

??
loosechickens just provided the link with all kinds of specifics. Is there any you care to refute?

Yossarian
4-21-12, 4:08pm
??
loosechickens just provided the link with all kinds of specifics. Is there any you care to refute?

No one disputes that there are disparities in income, which is all that link shows, so it doesn't really address anything at issue.

Lainey
4-21-12, 4:15pm
No one disputes that there are disparities in income, which is all that link shows, so it doesn't really address anything at issue.

It shows much more than that - namely, that borrowing money to give tax cuts to the wealthy does not - repeat, does not - provide job growth in the U.S.
So, it's not about how much "effort" one is willing to put in, it's about these economic myths that continue their zombie-like existence.

bae
4-21-12, 4:24pm
??
loosechickens just provided the link with all kinds of specifics. Is there any you care to refute?

"Many orthodox people speak as though it were the business of sceptics to disprove received dogmas rather than of dogmatists to prove them. This is, of course, a mistake. If I were to suggest that between the Earth and Mars there is a china teapot revolving about the sun in an elliptical orbit, nobody would be able to disprove my assertion provided I were careful to add that the teapot is too small to be revealed even by our most powerful telescopes. But if I were to go on to say that, since my assertion cannot be disproved, it is intolerable presumption on the part of human reason to doubt it, I should rightly be thought to be talking nonsense. If, however, the existence of such a teapot were affirmed in ancient books, taught as the sacred truth every Sunday, and instilled into the minds of children at school, hesitation to believe in its existence would become a mark of eccentricity and entitle the doubter to the attentions of the psychiatrist in an enlightened age or of the Inquisitor in an earlier time." - Bertrand Russell

peggy
4-21-12, 8:49pm
"Many orthodox people speak as though it were the business of sceptics to disprove received dogmas rather than of dogmatists to prove them. This is, of course, a mistake. If I were to suggest that between the Earth and Mars there is a china teapot revolving about the sun in an elliptical orbit, nobody would be able to disprove my assertion provided I were careful to add that the teapot is too small to be revealed even by our most powerful telescopes. But if I were to go on to say that, since my assertion cannot be disproved, it is intolerable presumption on the part of human reason to doubt it, I should rightly be thought to be talking nonsense. If, however, the existence of such a teapot were affirmed in ancient books, taught as the sacred truth every Sunday, and instilled into the minds of children at school, hesitation to believe in its existence would become a mark of eccentricity and entitle the doubter to the attentions of the psychiatrist in an enlightened age or of the Inquisitor in an earlier time." - Bertrand Russell

And your quote about the existence, or non existence of god has what context in this discussion? That quote is about the dogma of belief in a god, or other invisible, imagined deity.

peggy
4-21-12, 8:57pm
When I see folks repeatedly falling into the use of thought-terminating cliches, refusing to address refuting information, refusing to provide specifics, relying on handpicked examples and nonrepeatable experiments, being unwilling to test, and using all the other shop-worn techniques of distraction and avoidance, I know I am dealing with people who have been inculcated with a belief system, and factual honest open discourse is of no further use.

"And I usually use myself as a model, posing in front of a mirror as I dab the strokes on the canvas."
Cleo Moore

txgran
4-22-12, 9:16am
I'm honestly sick of this whole subject. And, no, I'm not going to spend hours Googling to buttress what I've said here. Most of us know it is true, because we feel it in our lives, and those whose ideological views are more in the dog eat dog view will always have wonderful talking points to muddy the waters. But the truth is that a LOT has changed in this country in the past thirty years, really since conservatives have gained power, from Reagan, on. And most of the actual growth in wealth and income during those years has gone to the very richest of the rich, who are the people who pull the conservative strings, despite the fact that a number who follow them don't really realize that, or somehow think that someday they are going to join them.

I give you this. It's an excellent picture of how, factually, the middle class is being hollowed out by these conservative ideas, that have been kicking around and gaining traction in recent decades. And, then, I'm off.......because real life is out here being wasted while I'm in here hitting my head against a proverbial brick wall. Those who might actually be interested in understanding what has happened in this country in recent decades, can click here. Those of you who believe wholeheartedly in that "free market", "cream rises" world, keep on keeping on, I guess.

http://currydemocrats.org/american_pie.html


ahh...........facts, the chart pretty well says it all.

Gregg
4-22-12, 10:21am
If anyone knows of an example in history where a society was rejuvenated through forceful capture of the assets of the wealthy and a subsequent redistribution to the 'lower classes' please let us know. I don't believe there are any. The attempt ultimately fails every single time. Or the society does.

It absolutely amazes me that the entire Democratic position appears to be based on the "fact" that wealth is a zero sum game. It's not. Wealth CAN be created. Do the top few percent control a big share of the pie? Yes, obviously they do. Did they get it by taking it out of the pockets of the middle class. No. It's wealth that the middle class (or anyone else) never had because it was created. If you want to effect some good for the middle class through policy it needs to be in a way that will cause the assets held by that class to increase in value. Housing, for example. That's where the middle class holds their wealth and it is a declining value asset. As long as that is the case we can not reverse the course, except at gunpoint, of course.

When the economy is slow and inflation is low, or worse, when we experience deflation of a prime asset class, alot of the gains in wealth become relative (as shown in all of LC's charts). If my neighbor and I start out with exactly the same net worth, but I rent and he owns his house and that house decreases in value then I have advanced to where I have a bigger share of the American pie, but I didn't necessarily gain anything. If you want to show dramatic changes in all of the charts in LC's post just kick inflation up to 7% or so for a few years. The very small billionaire class will still gain the most in terms of absolute dollars if you do that, but a gigantic shift will take place on the pie chart when the largest asset held by hundreds of millions of middle class homeowners starts jumping in value. The math works like this...

If every single one of the 403 billionaires in the US (according to Forbes (http://wiki.answers.com/Q/How_many_billionaires_are_in_the_US)) all make huge gains and increased their wealth by a full $1 billion that is an increase in wealth of $403 billion.

If 150 million homeowners all experience an average increase in the value of their home of $25,000 that would be an increase in wealth of $3.75 trillion.

In this example almost 90% of the increase in wealth would go to homeowners and the majority whom are in the middle class. That would be a healthy redistribution of wealth, it would radically change all those pretty pie charts and Congress wouldn't even have to pull a gun.

creaker
4-22-12, 11:16am
We have a lot of examples in the world where little redistribution of wealth takes place - I think that as a country we're just moving more toward these models. We've had a long trend where global differentials in labor and productions costs have been used to turn profits, eventually those differences will equalize. Whether that's a good thing or not I guess would depend on where you're standing.

Yossarian
4-22-12, 11:37am
We've had a long trend where global differentials in labor and productions costs have been used to turn profits, eventually those differences will equalize. .

True that, and when you combine it with the rise of the tech/information economy it is not hard to see what the impact is. The Google guys didn't take money from the steelworkers, and that shift in wealth isn't attributable to tax rates. However if we suppress the upside of the economic trends all we have left is the downside.

Lainey
4-22-12, 2:06pm
.

... The Google guys didn't take money from the steelworkers ... .

No, but Bain Capital did: http://www.phoenixnewtimes.com/2012-04-19/news/american-parasite-mitt-romney-s-years-at-bain-capital/

Best article I've read yet summarizing the wealth-destruction by Bain Capital.

Lainey
4-22-12, 2:23pm
If anyone knows of an example in history where a society was rejuvenated through forceful capture of the assets of the wealthy and a subsequent redistribution to the 'lower classes' please let us know. I don't believe there are any. The attempt ultimately fails every single time. Or the society does.

It absolutely amazes me that the entire Democratic position appears to be based on the "fact" that wealth is a zero sum game. It's not. Wealth CAN be created. Do the top few percent control a big share of the pie? Yes, obviously they do. Did they get it by taking it out of the pockets of the middle class. No. It's wealth that the middle class (or anyone else) never had because it was created. If you want to effect some good for the middle class through policy it needs to be in a way that will cause the assets held by that class to increase in value. Housing, for example. That's where the middle class holds their wealth and it is a declining value asset. As long as that is the case we can not reverse the course, except at gunpoint, of course.

When the economy is slow and inflation is low, or worse, when we experience deflation of a prime asset class, alot of the gains in wealth become relative (as shown in all of LC's charts). If my neighbor and I start out with exactly the same net worth, but I rent and he owns his house and that house decreases in value then I have advanced to where I have a bigger share of the American pie, but I didn't necessarily gain anything. If you want to show dramatic changes in all of the charts in LC's post just kick inflation up to 7% or so for a few years. The very small billionaire class will still gain the most in terms of absolute dollars if you do that, but a gigantic shift will take place on the pie chart when the largest asset held by hundreds of millions of middle class homeowners starts jumping in value. The math works like this...

If every single one of the 403 billionaires in the US (according to Forbes (http://wiki.answers.com/Q/How_many_billionaires_are_in_the_US)) all make huge gains and increased their wealth by a full $1 billion that is an increase in wealth of $403 billion.

If 150 million homeowners all experience an average increase in the value of their home of $25,000 that would be an increase in wealth of $3.75 trillion.

In this example almost 90% of the increase in wealth would go to homeowners and the majority whom are in the middle class. That would be a healthy redistribution of wealth, it would radically change all those pretty pie charts and Congress wouldn't even have to pull a gun.

It amazes me that Republicans pretend that middle-class wealth wasn't destroyed by the raiding of pension funds and loading healthy companies with debt forcing them into bankruptcy. See again the article I posted about Bain Capital, and then multiply that by the other finance companies doing the same thing - and yes, no guns pulled, and a scant few (e.g. the unrepentent Andy Fastow) sent to prison.

ApatheticNoMore
4-22-12, 2:54pm
If anyone knows of an example in history where a society was rejuvenated through forceful capture of the assets of the wealthy and a subsequent redistribution to the 'lower classes' please let us know. I don't believe there are any. The attempt ultimately fails every single time. Or the society does.

At a certain level of wealth inequality can you even have a healthy society? Well look certainly you can't when short sighted wealth captures the political system (cough, cough, that would be now). But also if you become a banana republic with a few rich people and many many poor. Um what is the status of civil liberties of the democratic process etc. etc. in THOSE countries? At a certain point you are dictatorial just to keep the masses from revolting. Ever been countries with civil liberties, in which the democratic process actually worked with this level of wealth inequality? Probably not because at a certain level of wealth inequality the democratic process will likely decide to redistritube some wealth :). But if not that, you do have to keep down revolution.


It absolutely amazes me that the entire Democratic position appears to be based on the "fact" that wealth is a zero sum game. It's not. Wealth CAN be created. Do the top few percent control a big share of the pie? Yes, obviously they do. Did they get it by taking it out of the pockets of the middle class. No.

Maybe, maybe not. Are BPs profits taken out of the pockets of the middle class. Well it is not a middle class thing, they have taken from us all. It is wealth creation in private pockets through destruction of the commons (which btw is SO MUCH that is wrong with modern captialism, much of what the harshest critics critique, the destruction of the world by the economic system is precisely this). What about agribusiness profits from conventional farming? Same thing. We all know about bankster profits, clearly they have got us coming and going. They pocket profits in the boom and then when those profits prove to have been acheived through deception, pocket bailouts in the bust (not just their bailouts were illegitimate the boom profits also were really, although at least letting them go broke or be nationalized ...). Many of our big businesses seem quite corrupt not to mention the FIRE economy. Most mid-size businesses are rather mundane (they aren't necessarily destroying the planet wholesale or engaged in chicanery). Although I will say outright that anecdotally every business I've ever worked in when it reached a certain size had quite a decent part of it's sales coming from government for what it's worth (and I don't consider that by itself immoral or anything. Some were probably prompted to do so in self-defense from the government - yea I'm speaking of actual historical timelines of businesses I have known here. I'm just showing how business and government are all wrapped up in each other even when it's not corrupt - when it's corrupt, oh boy!). But yea many businesses mundane. Great innovators are the exeception. A google or something more the exception than not and maybe pure ephimerialization (Bucky Fuller), money created through idea generation, something existing where it didn't before. When you start dealing with the pure physical world though, more for some can become less for others, it's a finite planet, that's that capture of the commons stuff.


If you want to effect some good for the middle class through policy it needs to be in a way that will cause the assets held by that class to increase in value. Housing, for example. That's where the middle class holds their wealth and it is a declining value asset. As long as that is the case we can not reverse the course, except at gunpoint, of course.

That is a disasterous way to help the middle class. I mean really the housing bubble - disasterous. That such policies are actively pursued and they were, whether or not they are to give money to the middle class (may have been as much for the banksters as anyone but it did create a middle class wealth ILLUSION) is just ugh. What the middle class needed was real wage increases. Housing is both an asset and an expense for the middle class and some kind of shelter is a *necessary* expense too. Let that sink in, who really wants their expenses to increase? Do we go around saying we want higher food prices etc.? (well some of us do because we want externalities fullly internalized, but it's not a popular position). Expense increases in such a case can accomplish good, but expense increases are not BY THEMSELVES a good. So middle class person buying their first house, with housing prices increased will pay far more for it in terms of downpayment (ha downpayments what a quaint old-fashioned notion - but if he has a downpayment it won't go as far!), in terms of monthly nut, in terms of taxes (property taxes based on property value), and especially in terms of interest owed over the life of the loan (for two reasons, downpayment covering less of the loan and higher cost meaning more money lent)! So who is really getting rich here? The homeowner or the banks? Hmm ..... Now there is a way to win a housing bubble, get in while it's cheap, sell out at the peak etc.. But that doesn't mean the majority wins from housing bubbles. In fact housing bubbles actually *ARE* true ZERO SUM wealth. Higher housing prices also increases rents for those who seem at first glance outside the game entirely (the renters). So no, you want to help the middle class: increase wages, not housing prices (the last decade is testament to that). How? Not so easy, but pro-worker policies could probably help.

Yossarian
4-22-12, 4:02pm
No, but Bain Capital did: http://www.phoenixnewtimes.com/2012-04-19/news/american-parasite-mitt-romney-s-years-at-bain-capital/

Best article I've read yet summarizing the wealth-destruction by Bain Capital.

Unless you just fell off the turnip truck or make buggy whips for a living none of this should be an issue. There are no guarantees of success, moving assets to their highest and best use adds value, and no matter how much you wish the world revolved around you it doesn't.

Gregg
4-23-12, 9:19am
At a certain level of wealth inequality can you even have a healthy society?

"A certain level" is a little to broad a concept to address, but unless you wish to return to a purely tribal existence inequality of wealth within society is a given. Even in a tribal situation someone is the keeper of the fire and that asset could be leveraged. Guess we have to go back farther than that...



Are BPs profits taken out of the pockets of the middle class?

No, they are not. BP, et al, certainly make profits because the middle class and everyone else buys their product, but it is because you give money to them (of your own free will, no less), not because they take it from you. If you want to change anything, don't buy what they're selling. You have the option. Would life be less convenient without your car and the gas that runs it? You bet. That's why we all keep buying from the BPs of the world, but you need to remember, it ain't Momma's milk their selling, it is purely a choice made out of convenience. You won't die without it, no matter how dramatic some folks try to make it sound, any more than you would die without a washing machine or a 60 second microwave meal for lunch. We've been on the treadmill before, but the simple truth is that if enough consumers stopped buying what they sell they would either change products or go out of business.




That is a disasterous way to help the middle class. I mean really the housing bubble - disasterous.

A bubble can be disastrous, but I'm not talking about a bubble. A bubble is a short cycle of unsustainable inflation. A long cycle of steady inflation is not a bubble, it's appreciation. Outcomes on either end of the economic spectrum will hurt most participants in an economy. A bubble because most will not recognize it as such and so will not get out before it bursts or, as was so common in the housing market, they will try to get in by speculating when the only remaining profit avenues are cannibalistic. On the other end, deflation or stagnation also hurt most people with modest assets because the things that are typically held as their largest assets are not increasing in value or are even declining. We are in a stagnant economic period right now and, in the case of housing, there are still pockets of deflation. Until that is corrected the middle class will continue to lose ground. The Buffett Rule will do nothing to change that.

jp1
4-23-12, 10:20am
Unless you just fell off the turnip truck or make buggy whips for a living none of this should be an issue. There are no guarantees of success, moving assets to their highest and best use adds value, and no matter how much you wish the world revolved around you it doesn't.

So, putting $8m down on a company, paying yourself over 4 times that amount in the first year and then driving a company that was highly productive into bankruptcy because you saddled it with astronomical debt is your idea of moving assets to their highest and best use? Interesting viewpoint.

Gregg
4-23-12, 12:55pm
What may be more interesting is the fact that the left is constantly bringing up the KB Toys / Bain Capital deal as a way to slander the Republican front runner. I'm assuming that is the deal you had in mind jp1 since it is the only Bain deal that anyone ever brings up. Political mudslinging is the only apparent goal. What fails to get mentioned is that Mitt Romney left Bain years before that deal and not long after he left he placed his assets in a blind trust. That means that he would not have known if his positions had been divested or not and certainly would not have had knowledge of the company's dealings from the inside.

I won't attempt to defend Bain because I have no way of knowing what the intentions of the principals were at the time. I do know they also owned a large stake in a KB competitor, Toys R Us, and that by closing one company the competitor was made stronger, the jobs there more secure, the stock price (and corresponding value of employee retirement funds) was raised, etc. Did the loss on one hand balance out with the gain on the other? I'm not sure, maybe. What I do know is that there are at least two sides to every story and that the truth almost always lies somewhere in the middle. And yes, it is quite possible that taking all the assets out of KB Toys and putting them into Toys R Us or some other portfolio company was the highest and best use of that asset by Bain Capital given the growing competition from internet sellers and the trends away from sticks and bricks locations.

ApatheticNoMore
4-23-12, 1:08pm
I don't believe that instead of public policy to shift off fossil fuels we should all just stop buying gas. That's ridiculous. And by the way it's not even EFFECTIVE, if some people stop buying gas other people will just make up the shortfall.

Geez, even when I think the system needs to be defunded (and I do, as too much of value is being destroyed), I don't think "why not buying gas, that's the answer", because again someone will just end up using it.

Gregg
4-23-12, 2:06pm
I don't believe that instead of public policy to shift off fossil fuels we should all just stop buying gas. That's ridiculous.......I don't think "why not buying gas, that's the answer", because again someone will just end up using it.

And the beat goes on.

Remember the Golden Fluffo shortening that Mike Wallace pushed in his early days? Not many do. Guess what, people stopped buying it and look where it is, or rather isn't, now. There wasn't anything so glamorous as a boycott, it was just a matter of more and more people switching to other products until Proctor & Gamble (who made it) finally decided to shut it down and make something else. Capitalism at work.

ApatheticNoMore
4-23-12, 2:47pm
And you expect that to happen for petroleum in the global economy?

creaker
4-23-12, 3:13pm
And you expect that to happen for petroleum in the global economy?

Maybe when they find something to compete with petroleum - so far they haven't and I don't expect they will.

Alan
4-23-12, 3:26pm
Maybe when they find something to compete with petroleum - so far they haven't and I don't expect they will.

Natural Gas? Methanol?

bae
4-23-12, 3:49pm
Maybe when they find something to compete with petroleum - so far they haven't and I don't expect they will.

I expect that "they" will, once supplies dwindle and prices raise.

Right now though, at today's prices, petroleum represents a great bargain, when you look at the amount of energy embodied in a barrel of oil.

creaker
4-23-12, 3:53pm
Natural Gas? Methanol?

Even with the current boom of natural gas, I believe the quantities just aren't there. And refitting a petroleum based infrastructure would be costly.

LDAHL
4-23-12, 4:04pm
Maybe when they find something to compete with petroleum - so far they haven't and I don't expect they will.

It is difficult to say what is impossible, for the dream of yesterday is the hope of today and the reality of tomorrow. - Robert Goddard (1882-1945)

Midwest
4-23-12, 4:49pm
Natural gas vehicles are already coming on line. With the massive supply of natural gas in North America that can't be easily transported overseas at present, it makes economic sense to begin using natural gas to supply our transportation needs.

http://online.wsj.com/article/SB10001424052970203986604577257770238882852.html

Gregg
4-23-12, 4:53pm
And you expect that to happen for petroleum in the global economy?

Petroleum replaced a means of getting work done that fell out of favor with enlightened societies, including ours: slave labor. As resource wars, the poisoning of our air and water, geopolitical conflicts caused by single resource players, economic downturns based on scarcity (real or imagined) and all the other lovely side effects of fossil fuel dependence become less and less tolerable it too WILL fall out of favor. There will be things that are taken for granted tomorrow that we can't even imagine today so I don't know what the ultimate replacement will be. Perhaps rather than a replacement source of energy we will just eliminate the need for most of it. Regardless, the next step will have to involve combinations of the several sources we have now before any replacement is simply swapped out for oil. But the short answer is, yes, I do expect that to happen to petroleum in the global economy. You just might not like the timeframe.

creaker
4-23-12, 5:32pm
Natural gas vehicles are already coming on line. With the massive supply of natural gas in North America that can't be easily transported overseas at present, it makes economic sense to begin using natural gas to supply our transportation needs.

http://online.wsj.com/article/SB10001424052970203986604577257770238882852.html

We're using it for other's needs as well - I've heard we're importing oil and using the cheaper natural gas to crack the oil into gasoline, which we're then exporting.

CNG busses have made such a difference in Boston. Diesel is nasty in cities.

jp1
4-23-12, 9:44pm
What may be more interesting is the fact that the left is constantly bringing up the KB Toys / Bain Capital deal as a way to slander the Republican front runner. I'm assuming that is the deal you had in mind jp1 since it is the only Bain deal that anyone ever brings up.

Actually, no I was reffering to Georgetown Steel, the first example mentioned in Lainey's link, which happened when Romney worked there. Planet Money did an interesting episode a few weeks back where they looked into all the deals that took place at Bain during Romney's time there, which showed decidedly mixed results.

But regardless, an equally important question regardless of Romney and Bain would be whether there's a better way then the current equity capital "buyout" of companies with a small down payment and large debt being taken on by the purchased company. I honestly don't know what the right answer is since truthfully I'd rather err on the side of allowing businesses to make their own decisions, but it seems like there are a lot of examples of companies being bled dry by equity firms and either put out of business or of workers at formerly successful companies getting screwed over after equity firms have saddled them with too much debt and no cushion to survive changes or cyclical downturns in their competitive environment. Yet somehow the equity firm never seems to lose since they do like they did with Georgetown Steel in my example above and take out their profit early on in the game. What the solution is, I don't know.

Gregg
4-24-12, 9:31am
Actually, no I was reffering to Georgetown Steel, the first example mentioned in Lainey's link, which happened when Romney worked there.

Fair enough jp1, I'm sorry for jumping the gun. I also think that the approach you describe is problematic. What I can't really figure out is why the credit to take companies so far into debt is still so readily available when history shows it doesn't always work out so well? Why would banks keep lending when it becomes obvious the debt is going to have a significant negative impact on the borrower and there is a real risk they may not be able to pay it back? What's in it for the investment banks or other lenders that I'm missing? I guess its as simple as the lenders charging enormous fees up front then packaging and reselling the loans so an unlucky fool somewhere down the line is who actually gets stuck with the sour debt. If that is the case rules providing a little more transparency in lending might be helpful.

Gregg
4-24-12, 1:27pm
Interesting timing for this article (http://finance.fortune.cnn.com/2012/04/24/pay-gap-rich-poor/?hpt=hp_c1) from Fortune, via CNN. It talks a little about what the 1% are doing right that helps them get to that position. It's very short, only a page.

flowerseverywhere
4-24-12, 3:03pm
Gregg, interesting article that puts things in a different perspective. Unfortunately for young kids even with a degree it is tough to get a start down that path with all the student debt and unemployment.


Another big factor is number and timing of children an staying married. A smaller family in a two parent home has the potential to give more resources and attention to each child. Watching my kids and their friends they are having smaller families, later in life and focusing on giving them educational advantages (and they aren't the 1% but maybe the top 25% or so). Contrast that with last week when I subbed in inner city schools while they were training the nurses in new forms they had to fill out for medicaid, and the poorer schools were full of kids with multiple siblings with different names, younger parents and one adult in the home (every single case I saw was a mother or grandmother), almost all free lunch and breakfast kids. What chance do they have of every being lifted out of poverty as compared to the parents I see in my neighborhood and my kids and their friends. Some of the kids I saw in Kindergarden and First grade knew less than my two year old grandchild and had no preparedness for learning to read and do basic math. Of course there are huge exceptions to this informal observation- but it does explain some of the gap between the poorest and richest in our society. Perhaps it is what the bottom percent is not doing right.

Needless to say I did this as a favor for a friends and it was a real eye opener to me, who normally sticks to suburban middle class and above schools.

You can tax the 1% at 80% and it won't be enough to overcome todays social issues.

ApatheticNoMore
4-24-12, 5:32pm
Harvard's Lawrence Katz has calculated that even if all the gains of the top 1% were redistributed to the 99%, household incomes would go up by less than half of what they would if everyone had a college degree

So if everyone had a college degree suddenly all jobs would be the exact same ones that exist now that "require" college degrees? And where would all these additional high wage jobs come from? I mean if you only need so many whatevers now, why are we suddenly going to need so many more whatevers in the future just because everyone has a degree qualifying them to be a whatever? I mean you can take jobs from other countries to some extent (but that's not so easy to do while being high wage, only a few countries seem to have that down (like Germany) - while a whole bunch of other countries have mastered "the race to the bottom").

Gregg
4-24-12, 6:45pm
I have no idea how Lawrence Katz developed his formula regarding the effect of education on income, but had the impression that it was a very long term observation not terribly skewed by what has happened in just the past few years. Anyway, I could not possibly agree more with anyone who believes that job creation is the top priority right now, for everyone, not just recent college grads. Technically creation of an environment in which job creation is rewarded is what's needed, but I split hairs. From my POV the article was interesting simply because it starts to address an issue from the bottom up rather than the top down. I'm a glass half full kinda guy most of the time so reducing gaps by lifting the bottom up is a lot more appealing to me than doing it by knocking the top down. YMMV.

JaneV2.0
4-24-12, 7:45pm
My understanding is that progressive taxation is at least partially designed to temper the rise of the kind of robber-baron empires seen at the turn of the last century. Our post-war economy boomed with top-tier tax rates three times what earned income is taxed at today, so it's hard for me to see why anyone would complain about current rock-bottom federal taxation. I'd like to see a return to at least Reagan-era rates.

Personally, I don't care if people's passion and focus in life is amassing money; that's their business. But when they use the money they've accumulated using taxpayer-supported laws and infrastructure to pour money into the campaigns of the Scott Walkers of the world, funding union busters and job exporters and other malefactors, it becomes an issue for me. And now, with the Citizens United decision, there are absolutely no barriers to just outright buying an election, so that we have a de facto government of the very, very rich. Not what the Founding Fathers intended.

ApatheticNoMore
4-24-12, 8:23pm
Personally, I don't care if people's passion and focus in life is amassing money; that's their business.

It's a very bizarre focus in life beyond a certain point (a certain point of wealth of course but also a certain point of sacrificing other values for money), but yea really, who thinks about this stuff.


But when they use the money they've accumulated using taxpayer-supported laws and infrastructure to pour money into the campaigns of the Scott Walkers of the world, funding union busters and job exporters and other malefactors, it becomes an issue for me. And now, with the Citizens United decision, there are absolutely no barriers to just outright buying an election, so that we have a de facto government of the very, very rich. Not what the Founding Fathers intended.

+1 it's seems it's become a self-reenforcing feedback loop: buy off the government, government makes laws and spends money in your favor, use profits to buy off the government. Rinse repeat, forever, until maybe eventually the whole thing collapses. Meanwhile not a single policy on anything sane like protecting the environment sees the light of day (it might offend a big polluter somewhere who has .... bought off the government).

LDAHL
4-25-12, 9:49am
Personally, I don't care if people's passion and focus in life is amassing money; that's their business. But when they use the money they've accumulated using taxpayer-supported laws and infrastructure to pour money into the campaigns of the Scott Walkers of the world, funding union busters and job exporters and other malefactors, it becomes an issue for me. And now, with the Citizens United decision, there are absolutely no barriers to just outright buying an election, so that we have a de facto government of the very, very rich. Not what the Founding Fathers intended.

It will be interesting to see how Walker fares in the recall election this June. Either the government unions re-establish their closed shop status, or they and their supporters in the Democratic Party will lose a significant and reliable funding source permanently. The Democratic primary candidate most closely aligned with the unions is Kathleen Falk. She has pledged to veto any state budget that does not return to the status quo pro ante. She appears to be running behind Tom Barrett, the Mayor of Milwaukee.

With the implications for national trends, a lot of money is pouring into Wisconsin on both sides, and television stations in the larger markets are doing very well by the first amendment right now.

Gregg
4-25-12, 10:03am
It's a very bizarre focus in life beyond a certain point (a certain point of wealth of course but also a certain point of sacrificing other values for money), but yea really, who thinks about this stuff.

When you think of it in terms of accumulating more of anything than you can use there is an element that doesn't make much sense. At that point it really doesn't matter if its gold or cats or Gods or zucchini plants, I would think the psychology is the same.

Regarding taxation, I think our government takes in plenty of money right now and don't think anyone needs to pay more. The government needs to spend less. And it needs to spend in ways that offer more benefits to more people. If those kinds of changes are made and we are still going deeper in debt then higher taxes might make more sense.

dmc
4-26-12, 7:58am
Maybe it would help if old Warren would just pay what he owes.
http://www.huffingtonpost.com/2012/03/27/warren-buffett-netjets-taxes_n_1382591.html

Also if he thought that the government was doing such a fine job why is he donating the majority of his wealth to Bill Gates charity instead of letting it go to the gov in inheritance taxes.

peggy
4-26-12, 8:23am
Maybe it would help if old Warren would just pay what he owes.
http://www.huffingtonpost.com/2012/03/27/warren-buffett-netjets-taxes_n_1382591.html

Also if he thought that the government was doing such a fine job why is he donating the majority of his wealth to Bill Gates charity instead of letting it go to the gov in inheritance taxes.

Because we don't run the country on yard sales and donations?

Gregg
4-26-12, 8:38am
Also if he thought that the government was doing such a fine job why is he donating the majority of his wealth to Bill Gates charity instead of letting it go to the gov in inheritance taxes.

I'm glad the majority of his wealth is going somewhere that might do some good, but handing a chunk over to the government would silence a lot of critics. And who knows peggy, if we keep going like we are a yard sale may be exactly how we raise money. Whacha' give me for an Osprey?

JaneV2.0
4-26-12, 11:13am
I'm glad the majority of his wealth is going somewhere that might do some good, but handing a chunk over to the government would silence a lot of critics. And who knows peggy, if we keep going like we are a yard sale may be exactly how we raise money. Whacha' give me for an Osprey?

That's pretty much how we do health care now. Bake sales and car washes for kids with cancer. Ospreys? No problem. Buy two.
We should be ashamed of ourselves.

ApatheticNoMore
4-26-12, 1:52pm
Regarding taxation, I think our government takes in plenty of money right now and don't think anyone needs to pay more. The government needs to spend less. And it needs to spend in ways that offer more benefits to more people. If those kinds of changes are made and we are still going deeper in debt then higher taxes might make more sense.

Yea if only [incredibly unlikely hypothetical happened] then everything would be good. If only the sun became less bright global warming wouldn't be a problem. If only workers took over all the workplaces tommorow, we wouldn't have any need for overtime laws. "If all the world were paper, and all the sea were ink, and all the trees were bread and cheese ....". And if only the government really cut all of the things we might think it could cut (especially the military industrial complex IMO) then even worrying about how badly taxes were out of line with spending wouldn't be a problem. I mean idealism is fine, but I'm trying to extrapolate the LIKELY trend here. And this isn't going to end well .... Really should have just let the Bush tax cuts expire, was the least that could have been done.

By the way the U.S. may already have a flat tax if you take all taxes into account (and thus those who want flat taxes on the federal level are actually calling for regressive taxation, which wouldn't be surprising, a level playing field is never enough, too many want overt favortism for those that are already priviledged):
http://www.salon.com/2012/04/23/americas_true_tax_rate/singleton/

But I'm actually ok with social security being seperately financed, raise the cap on wages that are taxable by Social Security, and it can be near indefinitely (but oh horror some higher earning people might have to pay more taxes - because social security taxes would then be FLAT!). But really could well save social security for a really really long time. I don't actually speak about medicare because it's way too tied up in the mess that is the whole u.s. healthcare situation to likely have such an easy fix.

JaneV2.0
4-26-12, 2:19pm
"But I'm actually ok with social security being seperately financed, raise the cap on wages that are taxable by Social Security, and it can be near indefinitely (but oh horror some higher earning people might have to pay more taxes - because social security taxes would then be FLAT!). But really could well save social security for a really really long time. I don't actually speak about medicare because it's way too tied up in the mess that is the whole u.s. healthcare situation to likely have such an easy fix. "

I'll go further and say we should eliminate the cap on FICA taxes altogether along with making the rate progressive. Et voila'--no more funding problem. Al Gore was absoutely right-Social Security should be sacrosanct behind his hypothetical lock.

Gregg
4-26-12, 2:19pm
But I'm actually ok with social security being seperately financed, raise the cap on wages that are taxable by Social Security, and it can be near indefinitely (but oh horror some higher earning people might have to pay more taxes - because social security taxes would then be FLAT!). But really could well save social security for a really really long time.

All for it. Keep the rate flat, but eliminate the cap on both ends, collection AND payout. From what I've read that simple change would fund SS forever. The road block comes not when the conservative watchdogs complain about higher taxation, but when someone with a different political POV complains about the greedy people who would get to take more out just because they put 10 times or 100 times more in.

Yossarian
4-26-12, 10:28pm
That would make SS the biggest bait and switch ever. If you don't tie distributions to contributions, heck just go ahead send everyone envelopes of cash from day one and get this free cheese party really rocking.

ApatheticNoMore
4-26-12, 11:33pm
That would make SS the biggest bait and switch ever. If you don't tie distributions to contributions, heck just go ahead send everyone envelopes of cash from day one and get this free cheese party really rocking.

No the biggest bait and swith EVER EVER EVER is if there is little left for the generations after the boomers, after people have paid in their entire lives (but that's actually what is anticipated if you look at the Social Security statements, so that appears to be the current plan).

It's such horrible free cheese to want to implement changes that might allow the program to continue past the boomers, almost indefinitely. But just letting the boomers benefit from Social Security and there being NO SAFETY NET for old people afterwards despite having paid in all these years (basically supporting the boomers), is not free cheese AT ALL - why would anyone think so?

Yossarian
4-27-12, 7:11am
if there is little left for the generations after the boomers, after people have paid in their entire lives

That's me, post boomer generation. But my solution to the problem isn't to just screw the next generation down. People are living 15 years longer now than when SS was passed. We need to get away from the mindset that the solution is always to spend more. We can fix things by adjusting benefits to reflect the change in demographics.

Gregg
4-27-12, 8:28am
I don't like SS at all, but also don't think its a bait and switch. My generation, boomers, is the biggest generation to date because our parents fought a big war and really settled in when they got back home. We are also living longer than previous generations thanks to advances in medical care. The demographics are that simple. It's ridiculous to say the boomers are somehow evil and trying to screw upcoming generations. Anybody can figure out that if you have less people paying in than you have taking out AND those taking out are doing it for longer there is going to be a problem. Like ERG said, we need to make adjustments. IMO, we should eliminate the cap at both ends (contribution and distribution). Of the two parts of the FICA tax, the Medicare portion already has no upper limit. Only SS caps at $106,800. If you want to keep the program going in the future the simple move is to eliminate that cap. The increase in distributions wouldn't show up till later when the program is fully funded. Start it now and you'd have the advantage of the last 15 years or so of the boomer generation at full earning capacity paying in to support the older boomers and remaining members of the greatest generation.

Yossarian
4-27-12, 10:38am
If you want to keep the program going in the future the simple move is to eliminate that cap.

If you are going to move from a quasi pension scheme to a general welfare program, just roll it into the general fund and be done with it. I think it is a bad idea because once you unmoor the program, costs will likely just spiral higher, which is the the problem inherent in unfunded defined benefit plans. I wish there was a way to make this a funded plan or defined contribution plan but I don't see the political will.

ApatheticNoMore
4-27-12, 11:19am
To be honest I play with enough doomer scenarios that it may not even matter. But if it does.... I like Social Security, it protects old people from out and out poverty when they are often too old to be considered of value in the market (although the age that has gotten "too old" now due to age discrimination at this point is completely ridiculous - but those people are too young for Social Security anyway). Index funds and so on are not returning anything. You project the vast majority in plans with a zero rate of real return 20 or 30 years out and hmm. So much for employees paying the full cost of their retirement entirely by playing the stock market.

peggy
4-27-12, 11:36am
SS isn't a 'scheme'. I realize you are too young to know this but 'The Poor House' wasn't just a state of mind. It was an actual place where poor people, mostly elderly, went because they simply could not afford to live anywhere. I know young people all think they will be wildly successful and well off when they retire, every one of them thinks that, but the reality of life is, you probably won't be. I'm not saying you will be a failure. You can live a comfortable life, able to pay your bills and eat, but most won't be able, for one reason or another, to save what they need to fund life beyond working years, which are finite, despite your incredible good health now. Stuff just breaks down. And by the way, Boomers paid into SS too, all our lives, so the blame game just doesn't work there.
And pensions are going the way of dinosaurs. So what are the elderly to do? You can't just take away SS and re-boot. People need to eat, today as it turns out, and tomorrow and the next and the next day. They also need utilities, again today and tomorrow. And the elderly need more health care cause stuff does break down. And it's not just heart transplants for everyone, but everyday stuff they need which will enable them to live quite a while longer in relative good health.

SS is here to stay, thank goodness, so we need to start at that point and go forward to fix it. Begrudging people SS is ignoring history, as well as our own national ethics of moral obligation. Are we a third world country or are we the United States of America?

Stuff costs. That's a fact. We can't run a modern, progressive country on yesterdays dollars. Sure there is some waste and abuse, but not nearly enough to make up the short fall. The super wealthy need to stop whining and pony up some more. Not a lot, but some. NASA needs to stop whining and realize we simply can't aford to go to the moon right now (or Mars or anywhere else). The military needs to stop whining and cut the budget, and quit promoting wars and all the glittery gadgets that go with it. The big oil companies need to stop whining (as do we) and not expect subsidies (and we need to stop whining and realize what a gallon of gas really costs)

On the other hand, the nations infrastructure really needs to be addressed. That is going to cost a lot of money, so we just need to get on with it and stop whining. We are not about to let our elderly go hungry and homeless, so we just need to stop whining and fix it already, without all the political posturing and gamesmanship.

Gregg
4-27-12, 11:57am
To be clear, the only problem I have with SS is that it was set up to be supplemental retirement income, not the whole shebang. I couldn't tell you exactly where or when that started to change for so many people. I'm not even looking for anyone to blame. We need to deal with where we are and what's coming in a way that won't throw a whole generation of retirees under the bus and, unfortunately, that is going to have to include raising more money.



Stuff costs. That's a fact. We can't run a modern, progressive country on yesterdays dollars. Sure there is some waste and abuse, but not nearly enough to make up the short fall. The super wealthy need to stop whining and pony up some more. Not a lot, but some. NASA needs to stop whining and realize we simply can't aford to go to the moon right now (or Mars or anywhere else). The military needs to stop whining and cut the budget, and quit promoting wars and all the glittery gadgets that go with it. The big oil companies need to stop whining (as do we) and not expect subsidies (and we need to stop whining and realize what a gallon of gas really costs)

On the other hand, the nations infrastructure really needs to be addressed. That is going to cost a lot of money, so we just need to get on with it and stop whining. We are not about to let our elderly go hungry and homeless, so we just need to stop whining and fix it already, without all the political posturing and gamesmanship.

Ya know peggy, for a liberal you're ok sometimes.

creaker
4-27-12, 12:10pm
The big problem with SS has been the diversion of surpluses into the general fund and replacing them with IOU's. They knew the boomers were coming, but spent the money on other stuff instead on the misplaced notion that the next generation would be able pay for it.

Actually what's happened to this country over the past generation sounds a lot like the businesses Romnay is accused of taking over and gutting for profit.

Yossarian
4-27-12, 12:11pm
And by the way, Boomers paid into SS too, all our lives, so the blame game just doesn't work there.

It's not a matter of if, it's how much.


Begrudging people SS is ignoring history, as well as our own national ethics of moral obligation.

And on this point I invite you to man up and sell it straight. The history of SS is as a quasi pension plan where benefits (eligibility, payments, etc.) are at least indirectly related to contributions. If you want an all encompassing committment to fundng the elderly, step up and get a national consensus. Debased systems, be it healthcare or SS, just result in inefficiency.

peggy
4-27-12, 2:04pm
To be clear, the only problem I have with SS is that it was set up to be supplemental retirement income, not the whole shebang. I couldn't tell you exactly where or when that started to change for so many people. I'm not even looking for anyone to blame. We need to deal with where we are and what's coming in a way that won't throw a whole generation of retirees under the bus and, unfortunately, that is going to have to include raising more money.




Ya know peggy, for a liberal you're ok sometimes.


Well, what happened was pensions started going away. And health care costs went through the roof. If health care had risen only as paychecks and/or inflation, people would still be able to help themselves. But the rise was way out of proportion to the economy. And I think more elderly want to be independent. Where a few generations ago it was expected that the parents would come live with the kids, now they move to Florida to live independent lives. Unfortunately, or fortunately depending on how you see it, we are living longer, so more health care issues for the general population instead of the few who outlived everyone else. Men, for instance, will ALL have prostrate problems, with a very large percentage getting prostate cancer. In the past, a larger percentage simply died of old age before these problems arose, but now, thanks to modern medicine, you can expect to live until your prostrate is as big as a basketball! I think medicine is starting to take a more realistic view of this, in that they are just trying to control the symptoms without trying to cure. That approach could probably be applied to a lot of things, but, as a compassionate society, we aren't going to deny grandpa a good shot at cure if he really really wants it.
But, because folks are living longer and more advanced medicine is keeping some going who would otherwise depart, it is increasingly difficult to keep our parents at home even if we wanted to. My own father, who has alzheimers and parkinson's, is still himself, most of the time, but the combination of the two diseases makes it impossible to keep him at home. The physical care required is simply beyond me, my sisters or my mother. so he lives in a nursing home. they take very good care of him, but it's expensive. Insurance takes care of some and my mother the rest, thank goodness she can, but in a very few years there goes her nest egg. She will always have a home with me or my sisters, but she will be broke, relying solely on SS and medicare.

So, that's what happened. Life happened. Or rather the realities of life happened. We did away with the poor house, but in doing that we accepted the responsibility. And really, SS wasn't intended to be the sole support, but it has become so for many simply because there isn't anything else. This isn't a demographic that can simply go out and get a job, or make more money, or just not get sick.


"Ya know peggy, for a liberal you're ok sometimes."


Thanks gregg. Actually, I'm not unlike most liberals. Most liberals aren't bleeding heart anyone's. Now days, we're pretty much where republicans were not that many years ago. *

*:idea:it would seem, history tells us that the push to the right coincided with the downward spiral of the economy, infrastructure, politics, moral direction.....;)

JaneV2.0
4-27-12, 2:19pm
Absolutely. I'm a proud (mostly) Eisenhower Republican.

ETA: My g-grandmother spent some years of her (apparently miserable) life in a poorhouse. Not a family tradition I'm eager to honor.

Yossarian
4-27-12, 2:47pm
OK, devil's advocate - anyone know what the cost differential is between group housing and individual housing? Everyone here apparently considers it abhorent, but what are we talking, a free place to eat and live? Throw in some healthcare and how bad is it? Personally I think more communal housing would be better for us. You are of course free to disagree when spending your own money, but if the public is footing your food and rent why can't we look for efficient ways to do it? If you can live separately for the same cost that may be better, but why should the public pay more to get you that luxury?

chanterelle
4-27-12, 3:35pm
OK, devil's advocate - anyone know what the cost differential is between group housing and individual housing? Everyone here apparently considers it abhorent, but what are we talking, a free place to eat and live? Throw in some healthcare and how bad is it? Personally I think more communal housing would be better for us. You are of course free to disagree when spending your own money, but if the public is footing your food and rent why can't we look for efficient ways to do it? If you can live separately for the same cost that may be better, but why should the public pay more to get you that luxury?


Hey! it's Newt's 1990's era orphanage solution, only this time we warehouse our elderly poor. Cool!
Yes, since it's not your money, after working and paying taxes for a lifetime, or raising your children you have no say in where or how you live, because when you take government "charity" you become a second class citizen. Low income
removes your pride and independence.

Of course, since the government can't possibly run anything properly, building, equiping and running these places will just have to be privatized and since all govt workers ar just so over paid these places will be staffed with non-union low wage workers ...all the better to make sure that we have the next generation of elderly poor to fill these warehouses..
Really, it's not like SSI money goes back into the local economy in the form of food or clothing purchases. It doesn't pay rent or taxes on purchases or bus fare, haircuts, or gas or anything...society doesn't benefit at all from SSI. Such a waste.

ApatheticNoMore
4-27-12, 3:59pm
I'm not sure exactly what you are talking about, old folks homes are not particuarly cheap I don't think. Or is this just an argument for getting roommates? Or should the government build giant warehouses to warehouse the old? Somehow that doesn't sound very appealing ...

If this is just some argument that there should be cheaper ways to feed and house yourself and meet the basic necessities in life than there are. Yes, well ... wouldn't want wage earners to have that option though - they might quit!

Yossarian
4-27-12, 4:06pm
Really, it's not like SSI money goes back into the local economy in the form of food or clothing purchases.

Sure, just like healthcare costs, or military spending, or fancy GSA parties. It's all good, right? Maybe that's the solution to everything- the more the governemnt gives away the better we all are because hey, it all goes back in the economy. :doh:

JaneV2.0
4-27-12, 4:15pm
Tent City, here I come!

(BTW--good post, Chanterelle.)

chanterelle
4-27-12, 4:23pm
Sure, just like healthcare costs, or military spending, or fancy GSA parties. It's all good, right? Maybe that's the solution to everything- the more the governemnt gives away the better we all are because hey, it all goes back in the economy. :doh:

What nonsense, the military and pharma's bloated costs do not come into play here ...local economies, meaning local jobs, local sales tax revenues, goods and services, local property taxes and rents, everything that a population spends on...the things that keep the basic economy chugging along. Keeping senior citizens above the poverty line and marginaly healthy is basic common economic sense if nothing else.

Yossarian
4-27-12, 4:27pm
It was just an inquiry into why the "poor house" was a bogeyman. Some have claimed in the healthcare debate that we should remove the profit seeking entities from the equation. If you do that with nursing homes you basically have a govenrment owned operation to house and medicate the old folks. A modern day poor house so to speak.

Yossarian
4-27-12, 4:32pm
What nonsense, the military and pharma's bloated costs do not come into play here ...local economies, meaning local jobs, local sales tax revenues, goods and services, local property taxes and rents, everything that a population spends on...the things that keep the basic economy chugging along.

Stop, you are killing me. Every place is local to the people who are there.

JaneV2.0
4-27-12, 4:33pm
I have a friend whose elderly sister lives in a HUD-subsidized apartment. It sounds like a nice enough place with a sense of community among all the seniors. Most of the very old already live communally, so that part isn't much of a stretch. Personally, I dread living on top of a bunch of people, but it will probably come to that in the end. http://www.kolobok.us/smiles/big_standart/flag_of_truce.gif

creaker
4-27-12, 5:18pm
I thought this was interesting:

http://www.elderweb.com/book/export/html/2806

One thing I didn't know - many programs to help the elderly prior to SS were denied if there were children or relatives capable of providing.

LDAHL
4-28-12, 9:52am
Whether you believe Americans are capable of saving and managing the decumulation of retirement assets for themselves, or that government must step in and do it for them, we ultimately depend on the performance of the economy to provide the wherewithal for the needed dividends or taxes. Part of the solution may be to link government benefit increases to economic growth. I think the Swedes do something like that with a notional account system for their national pension.

Apart from injecting a bit of reality into the ongoing debate, there might be some political benefit to making the interests of the recipients more consistent with those of the providers. We might spend less time arguing about symbolic but fiscally trivial items like the Buffet Rule and more time discussing strategies that could really matter.

ApatheticNoMore
4-28-12, 10:34am
Whether you believe Americans are capable of saving and managing the decumulation of retirement assets for themselves, or that government must step in and do it for them

What a silly blanket statement, rather depends on under what conditions. Doesn't it all? Some people earn so little that they will never be able to save for retirement. Even those that do, under very little real rate of return it is going to be harder. Even then I am not convinced impossible. But under a scenario of very little real rate of return with the costs of things needed by the elderly increasong more than inflation. Hmm, when you reach the point that 80-90% of people can't save for their retirement maybe time to call game over. Certain positions would just blame these people for not being the virtuous 10-20% though.



we ultimately depend on the performance of the economy to provide the wherewithal for the needed dividends or taxes.

True it is probably why the whole thing is ultimately unsustainable, since this economy is unsustainable, and then much will have to change (they'll um still be the need to meet the basic needs for old people who can't provide immediate income through their labor). No I'm not envisioning ice floes even in that situation. But not sustainable because natural limits are reached, and not sustainable because of deliberate pursuit of plutocracy and bad fiscal policy are different things (cutting taxes in general but especially cutting of payroll taxes - yes those taxes that most directly fund social security and medicare - is just bad fiscal policy).

Gregg
4-28-12, 11:13am
What nonsense, the military and pharma's bloated costs do not come into play here ...local economies, meaning local jobs, local sales tax revenues, goods and services, local property taxes and rents, everything that a population spends on...the things that keep the basic economy chugging along. Keeping senior citizens above the poverty line and marginaly healthy is basic common economic sense if nothing else.

Nonsense? I was in a town last week who's LOCAL economy is VERY closely tied to a large defense contractor with a plant there. That company is the largest employer in town (by far) and provides the jobs that are at the top of the scale for pay and benefits. Those ARE local jobs. With those paychecks the people buy their local goods, hire their local services, pay their local taxes... Without those jobs the farmer's market, the art gallery, the dental clinic, the cafe and all the other local businesses in the "basic economy" would chug along right into their graves.

There are very few, if any, local economies in this country that exist without influence and input from larger scale state, regional, national and even global forces. When it comes for caring for the elderly that is a good thing because there are very few, if any, local economies that have the money and the resources to do much of that. Best be careful what you wish for.

ApatheticNoMore
4-28-12, 12:35pm
And there isn't anything else that federal government money could possible be used to do, but fund more "defense" department than even the pentagon asks for? There is a certain point where you know very well what you are asking for and can still wish for ... collapse (but even then it doesn't mean you wish for dumb ineffectual unjust ways to bring it on just because - as in lets reduce the funding for social security even more for a tax cut today!).

Gregg
4-28-12, 6:15pm
There is a certain point where you know very well what you are asking for and can still wish for ... collapse

Are you SURE that is what you want? Not a very pretty picture, but I suppose it would take care of the sticky issue of the elderly living too long.

Yossarian
4-28-12, 7:24pm
I've been watching a few episodes Doomsday Preppers so I'm ready.:moon:

jp1
4-29-12, 10:02pm
While it is certainly possible that a collapse could result in something better rising from the ashes it's equally likely that something worse, possibly much worse, could fill the void after an uncontrolled collapse. One only has to look to German history not quite 100 years ago to see just how bad things could turn out after the collapse. Hopefully we'll never have to find out what would happen in the US after a collapse.

bae
4-29-12, 10:47pm
While it is certainly possible that a collapse could result in something better rising from the ashes it's equally likely that something worse, possibly much worse, could fill the void after an uncontrolled collapse.

I think that the odds of a positive eventual outcome after a collapse are pretty darned low, if you look at history. Best to avoid.

A fellow once said, in a really decent speech:



You and I have a rendezvous with destiny.

We'll preserve for our children this, the last best hope of man on earth, or we'll sentence them to take the last step into a thousand years of darkness.


http://www.youtube.com/watch?v=qXBswFfh6AY

Gregg
4-29-12, 11:28pm
I have to agree that fastidious, self-imposed austerity measures now are far preferable to attempting a phoenix impersonation later.

creaker
4-29-12, 11:46pm
I have to agree that fastidious, self-imposed austerity measures now are far preferable to attempting a phoenix impersonation later.

That is assuming that self-imposed austerity measures aren't just a more controlled form of collapse - in an economic model dependent on growth, aren't austerity measures a move in the wrong direction?

Gregg
4-30-12, 9:01am
That is assuming that self-imposed austerity measures aren't just a more controlled form of collapse - in an economic model dependent on growth, aren't austerity measures a move in the wrong direction?

For starters we should probably consider broadening our economic base as opposed to a pure reduction. Some aspects of our economy (and our society) may benefit from lateral moves. Agriculture is king in my area and a prime example. We could begin a shift from global industrial ag to more localized producers and suppliers. Not a complete shift, but enough to make the base more stable. Subsidies that currently offer the most benefit to multi-national corporations could be shifted to some form of stimulus that would benefit smaller producers and companies and thus encourage a shift to a more local or regional model. Leaving environmental and health benefits out of it for now, the economic benefits would include more dollars remaining in local economies which should reduce the need for some federal programs allowing the budget to shrink. It would also support a wider job base which should remain more stable over time thereby reducing the need for federal unemployment assistance. In a way it would be a partial controlled collapse in one sector offset by growth in another.

Yossarian
4-30-12, 9:40am
in an economic model dependent on growth, aren't austerity measures a move in the wrong direction?

No. You seem to think government spending creates growth. Every dollar the govt spends is taken from somewhere else where it is likely doing more good. You can make a colorable claim that during certain short periods govt spending may provide a buffer of some kind, but only at the cost of reduced future growth.

bae
4-30-12, 9:58am
No. You seem to think government spending creates growth. Every dollar the govt spends is taken from somewhere else where it is likely doing more good.

I thought it was well known that it is more efficient to take a dollar from a citizen, run that dollar through half a dozen layers of administrative overhead, then spend it on Something Important, an to simply allow the citizen to spend the dollar directly.

I got dinged on an audit for an energy-assistance program one of my non-profits was administering for the State a few years ago. The average grant per client was about $200. I was allocating $7.00 per grant for our overhead, which is what it cost us according to my data. The State auditor told me that wasn't sustainable, and I'd have to start charging ~40% of the grant amount for overhead, or they'd have to take the program away and give it to someone else who could do a better job wasting money on handling fees...

jp1
4-30-12, 10:02am
Our economy isn't dependent on growth because of gov't spending. Our economy is dependent on growth for survival because of the way the money is created. Every dollar in existence was loaned into being by the federal reserve and has to be paid back with interest. Obviously that's not possible unless there's an ever increasing amount of dollars. If those dollars, along with hard work or natural resource utilization, are used to create something of value the system will continue to work, and grow. The alternative is bad debts getting written off and that money destroyed. Since the powers that be don't seem to want that to happen, because they and their bankster buddies are the ones holding the debt, we will continue to have the federal reserve creating more and more debt in the form of dollars so that the bad debt can be refinanced over and over until growth makes the debts payable. It's questionable whether that will work out given the vast vast amount of questionable debt that's already out there.

creaker
4-30-12, 10:29am
No. You seem to think government spending creates growth. Every dollar the govt spends is taken from somewhere else where it is likely doing more good. You can make a colorable claim that during certain short periods govt spending may provide a buffer of some kind, but only at the cost of reduced future growth.

Most entitlements get spent as consumer dollars - consumer spending is like 70% of the economy. I think this creates more jobs than some corporation buying a synthetic CDO betting on how someone else's portfolio is going to move. Almost all entitlement dollars handed out this month are sitting on business's balance sheets next month.

The problem is everyone got greedy and worked to pump a lot of borrowed money into the system and we now have an economy dependent on those borrowed dollars and where a huge amount of government revenue is used to pay interest on that debt. The only way to correct this is to shrink the economy which will break a system which requires ever increasing growth. Capitalism functions on boom and bust, I don't think we're going to be able to play the numbers to avoid the bust, although austerity is more of a controlled crash.

Yossarian
4-30-12, 11:14am
Most entitlements get spent as consumer dollars - consumer spending is like 70% of the economy. I think this creates more jobs than some corporation buying a synthetic CDO betting on how someone else's portfolio is going to move.

Not me. I will take a system of market based investment decisions over a government distribution system any day. Are there bumps in the road? Sure. But in the long run I think more jobs will come from individual liberty than centralized social entitlemnents. By your logic the USSR should have in fact buried us by now.

creaker
4-30-12, 11:39am
Not me. I will take a system of market based investment decisions over a government distribution system any day. Are there bumps in the road? Sure. But in the long run I think more jobs will come from individual liberty than centralized social entitlemnents. By your logic the USSR should have in fact buried us by now.

That's not what I'm saying at all - I'm saying we've dug ourselves into a hole and we can't just dig ourselves out of it.

So when would you end SS, Medicare, etc?

USSR was an oligarchy where a few were profiting from everyone else, that part of it is still there although there was some turnover in the players. And it's where we are now.

Gregg
4-30-12, 11:49am
The only way to correct this is to shrink the economy which will break a system which requires ever increasing growth. Capitalism functions on boom and bust, I don't think we're going to be able to play the numbers to avoid the bust, although austerity is more of a controlled crash.

Economies cycle, plain and simple. Government intervention has the potential to moderate the highs and lows, but as often as not either amplifies or extends them. Part of the beauty of capitalism is that the most opportunity exists when we're at the bottom. The same can not be said for government entitlements.

Yossarian
4-30-12, 11:54am
That's not what I'm saying at all - I'm saying we've dug ourselves into a hole and we can't just dig ourselves out of it.

Maybe I don't follow you. You said "in an economic model dependent on growth, aren't austerity measures a move in the wrong direction?" I said no, government spending doesn't produce long term growth, it crowds it out. There may be cases where that is an acceptable cost, but in the long term I don't think you get more growth by giving the government control over more of the economy. In what hole does that change?

creaker
4-30-12, 5:40pm
Maybe I don't follow you. You said "in an economic model dependent on growth, aren't austerity measures a move in the wrong direction?" I said no, government spending doesn't produce long term growth, it crowds it out. There may be cases where that is an acceptable cost, but in the long term I don't think you get more growth by giving the government control over more of the economy. In what hole does that change?

We got growth because the government injected huge amounts of debt into the economy. How do you correct that without seriously impacting the economy?

I'm saying at least in the short term, austerity would choke the amount of consumer dollars out there and affect not only those consumers but those further up the chain as well. Long term, I don't know - are there any examples out there?

creaker
4-30-12, 5:41pm
Economies cycle, plain and simple. Government intervention has the potential to moderate the highs and lows, but as often as not either amplifies or extends them. Part of the beauty of capitalism is that the most opportunity exists when we're at the bottom. The same can not be said for government entitlements.

So you think collapse is the way to go?

Gregg
4-30-12, 6:29pm
So you think collapse is the way to go?

If you mean a controlled collapse (aka a contraction) of a relatively significant percentage of the federal government, then yes I do. It's likely to happen on its own if we don't take action. I would much prefer that we retain some control and execute a "soft landing".

Part of the confusion may be the term austerity itself. In the classic sense it involves a reduction in spending and so also the programs/benefits that the spending provided in addition to debt reduction. I agree that deficit reduction is probably not a good idea right now. We need a productive economy that generates revenue to do that and we don't have one. The one advantage to our debt right now is that the interest is at historically low rates so reducing it doesn't have to be the top priority in the short term. After that even cutting spending can be confusing. It might make sense to keep the same budget we have right now, even with some deficit spending included, but reorganize what we spend money on. Infrastructure development spending is an investment. It will help this country get more done and do it better and so will generate revenue in the future. That is a reasonable kind of spending. There are examples of government spending that do not shine so brightly. Those are what needs to be cut, or collapsed, as the case may be.

Yossarian
5-1-12, 9:54am
The one advantage to our debt right now is that the interest is at historically low rates so reducing it doesn't have to be the top priority in the short term.

We don't need short term thinking, we need to get things fixed now while we can still make choices. If you wait until rates are a problem it's probably too late. From Ben:

By definition, the unsustainable trajectories of deficits and debt that the CBO outlines cannot actually happen, because creditors would never be willing to lend to a government with debt, relative to national income, that is rising without limit. One way or the other, fiscal adjustments sufficient to stabilize the federal budget must occur at some point. The question is whether these adjustments will take place through a careful and deliberative process that weighs priorities and gives people adequate time to adjust to changes in government programs or tax policies, or whether the needed fiscal adjustments will come as a rapid and painful response to a looming or actual fiscal crisis

...

Sustained high rates of government borrowing would both drain funds away from private investment and increase our debt to foreigners, with adverse long-run effects on U.S. output, incomes, and standards of living. Moreover, diminishing investor confidence that deficits will be brought under control would ultimately lead to sharply rising interest rates on government debt and, potentially, to broader financial turmoil. In a vicious circle, high and rising interest rates would cause debt-service payments on the federal debt to grow even faster, resulting in further increases in the debt-to-GDP ratio and making fiscal adjustment all the more difficult.

http://www.cnbc.com/id/41491193

Gregg
5-1-12, 10:32am
We don't need short term thinking, we need to get things fixed now while we can still make choices. If you wait until rates are a problem it's probably too late.

Exactly.

Yossarian
5-1-12, 10:46am
It is sometimes hard for people to grasp the budget issues with all the zeros attached. We focus a lot on family budget issues here, so maybe it helps to convert it to scale:


UNITED STATES OF AMERICA
U.S. Tax revenue: $2,170,000,000,000
Federal budget: $3,820,000,000,000
New debt: $1,650,000,000,000
National debt: $14,271,000,000,000
Recent / April 2011 budget cut: $ 38,500,000,000

Now, let’s remove 8 zeros and pretend it’s a household budget:

Annual family income: $21,700
Money the family spent: $38,200
New debt on the credit card: $16,500
Outstanding balance on the credit card: $142,710
Amount of April 2011 belt tightening $ 385

But the way I understand it the current part of the $385 is only about 1/10, so call it $4.

Would that make our frugalistas happy?

Alan
5-1-12, 11:16am
It is sometimes hard for people to grasp the budget issues with all the zeros attached. We focus a lot on family budget issues here, so maybe it helps to convert it to scale:


UNITED STATES OF AMERICA
U.S. Tax revenue: $2,170,000,000,000
Federal budget: $3,820,000,000,000
New debt: $1,650,000,000,000
National debt: $14,271,000,000,000
Recent / April 2011 budget cut: $ 38,500,000,000

Now, let’s remove 8 zeros and pretend it’s a household budget:

Annual family income: $21,700
Money the family spent: $38,200
New debt on the credit card: $16,500
Outstanding balance on the credit card: $142,710
Amount of April 2011 belt tightening $ 385

But the way I understand it the current part of the $385 is only about 1/10, so call it $4.

Would that make our frugalistas happy?

And the effect of the Buffett Rule on your annual family income? $47
It does nothing to correct the problem, but does make for good political theater.

ApatheticNoMore
5-1-12, 11:54am
Letting the Bush tax cuts expire would have done a lot more than the Buffet rule yes. But it still doesn't solve the problem? Well of course not. But hey hard to propose an alternative solution that even does at much as that would to bring revenues in line with spending. I mean really propose any alternative solution that even does as much to balance the budget as that does (and then you get into political feasibility. Is anything political feasible anymore but catastrophe? seriously? ending all the wars isn't generally considered politically feasible for instance).


We don't need short term thinking, we need to get things fixed now while we can still make choices.

Really basically my thinking on EVERYTHING - insulate every house in America while natural resources are still relatively plentiful and the economy not in total collapse yet etc.. Just do it. But mine is doomer thinking for sure :). But yes I wonder how long the window of choice on many things will persist.

Gregg
5-1-12, 2:00pm
I mean really propose any alternative solution that even does as much to balance the budget as that does (and then you get into political feasibility. Is anything political feasible anymore but catastrophe? seriously? ending all the wars isn't generally considered politically feasible for instance).

2012 Dept. of Defense Projected Spending - $707.5 Billion
2013 Dept. of Defense PROPOSED Budget - $200 Billion

A nice simple 1/2 trillion dollar savings. We tell the Joint Chiefs that they have to make sure our shores are defended. They're sharp guys, they will get it done for $200B. Would be quite the wake up call for Saudi Arabia, Tajikistan, Israel, Denmark, etc!

You're right about the political feasibility of ending wars. What say not one voter in this country votes for the guys who perpetuate that attitude. That would be as quick a turn around as the budget.