Deficit Dodge Ball

[Mursilis]

Originally posted by: frostedflakes
Taxes are definitely going to have to go up, the lower and middle class folks who thought we could pay for all of these programs by taxing only the rich will be in for a rude awakening. I'd expect we'll see an overall income tax increase sometime during his second term (obviously it would be political suicide if he tried to push it through in his first).

I expect we won't. Even if Obama doesn't have to worry about re-election after '12, Congress does.

 

[piasabird]

If the Economy does not improve by O'Bamas first term in office, there will be no Second Term for O'Bamma.

In the USA voters vote for their pocketbooks.

 

[LTC8K6]

Still projections, not actual numbers. Could be better, could be worse.

It shows the better and worse predictions...

 

[Fern]

Obama's proposal is based on a sound intuition: Do we really believe it's fair that when a married couple with a taxable income of $50,000 gives $1,000 to charity, they get a tax benefit of $150, while a couple earning $1 million making exactly the same contribution gets back $350? Is it fair that the higher-income couple also gets a bigger tax advantage on their mortgage payments?

You know, it would be nice if people who write about this stuff, like the author above, actually took the time to get clue about what they are talking about. I guess they feel there's no need to let the facts get in the way of a good story.

The couple earning the $50K is below the threashold for phase-out of itemized deductions.

OTOH, the million dollar couple will have $25,201 of their itemized deductions 'kicked-out. ($1 million less $159,950 = $840,050 x .03 = $25,201). That would completely wipe out their deduction but for the rule below.

You can't wipe-out more than 80% of the deduction, so they get to deduct 20% of $1,000 or $200.

$200 x .35 = $70.

So, the rich couple get back $70, while the $50K couple get back $150, more than twice as much (using his example).

Otherwise, yeah we all know the whole 'not raising taxes except on the rich' is bunch of nonsense given all the stuff this admin wants to purchase and bailout .

Fern

 

[Xellos2099]

The poor don;t give a shit really since they don't really pay income tax as most of them are cancel out by standard deduction, exemption and child tax credit. It would be the middle class who will realize they will pay more income tax due to their decision. Then again, some people believe that UHC is inalienable right so they might pay the tax without complain, but I doubt it.

 

[Mursilis]

Originally posted by: Fern

Obama's proposal is based on a sound intuition: Do we really believe it's fair that when a married couple with a taxable income of $50,000 gives $1,000 to charity, they get a tax benefit of $150, while a couple earning $1 million making exactly the same contribution gets back $350? Is it fair that the higher-income couple also gets a bigger tax advantage on their mortgage payments?

You know, it would be nice if people who write about this stuff, like the author above, actually took the time to get clue about what they are talking about. I guess they feel there's no need to let the facts get in the way of a good story.

The couple earning the $50K is below the threashold for phase-out of itemized deductions.

OTOH, the million dollar couple will have $25,201 of their itemized deductions 'kicked-out. ($1 million less $159,950 = $840,050 x .03 = $25,201). That would completely wipe out their deduction but for the rule below.

You can't wipe-out more than 80% of the deduction, so they get to deduct 20% of $1,000 or $200.

$200 x .35 = $70.

So, the rich couple get back $70, while the $50K couple get back $150, more than twice as much (using his example).

Otherwise, yeah we all know the whole 'not raising taxes except on the rich' is bunch of nonsense given all the stuff this admin wants to purchase and bailout .

Fern

And you're a CPA or something like that, right? I remember something along those lines.
Interesting - thanks.

 

[Fern]

Yeah, I'm a tax CPA

 

[MovingTarget]

Originally posted by: BoberFett
"No republic has long outlived the discovery by a majority of its people that they could vote themselves largesse from the public treasury." - Alexander Tytler


Everyone wants the government to provide their benefits but nobody wants to pay the bill.

This may be true in general, but in terms of healthcare, I believe that there are a significant percentage of people who actually would want to pay for these benefits via taxes as an alternative to today's broken system. There was a thread to this effect recently about raising taxes for increased services.

Besides, if given the choice, who doesn't like 'free'* stuff.

*not that free really exists outside of the other AT forum...

 

[Mursilis]

Originally posted by: MovingTarget

Originally posted by: BoberFett
"No republic has long outlived the discovery by a majority of its people that they could vote themselves largesse from the public treasury." - Alexander Tytler


Everyone wants the government to provide their benefits but nobody wants to pay the bill.

This may be true in general, but in terms of healthcare, I believe that there are a significant percentage of people who actually would want to pay for these benefits via taxes as an alternative to today's broken system. There was a thread to this effect recently about raising taxes for increased services.

Besides, if given the choice, who doesn't like 'free'* stuff.

*not that free really exists outside of the other AT forum...

Don't hold your breath. The free rider problem is very real, and people are pretty shameless about wanting something for nothing, especially if they've been told it's a "right". How many people willing pay over the required amount for taxes as it is? I've never seen actual numbers, but I'd be willing to bet it's less than 5%.

 

[MovingTarget]

Originally posted by: Mursilis

Originally posted by: MovingTarget

Originally posted by: BoberFett
"No republic has long outlived the discovery by a majority of its people that they could vote themselves largesse from the public treasury." - Alexander Tytler


Everyone wants the government to provide their benefits but nobody wants to pay the bill.

This may be true in general, but in terms of healthcare, I believe that there are a significant percentage of people who actually would want to pay for these benefits via taxes as an alternative to today's broken system. There was a thread to this effect recently about raising taxes for increased services.

Besides, if given the choice, who doesn't like 'free'* stuff.

*not that free really exists outside of the other AT forum...

Don't hold your breath. The free rider problem is very real, and people are pretty shameless about wanting something for nothing, especially if they've been told it's a "right". How many people willing pay over the required amount for taxes as it is? I've never seen actual numbers, but I'd be willing to bet it's less than 5%.

I'm not denying the free rider problem at all. However, I'm just saying that many are beginning to feel that it is the lesser of two evils, namely a national system (of whatever form) and the current situation where many simply do not pay at all. The free rider issue is still a huge problem even in our private system today (see emergency room use, denial of care laws, bankruptcy from medical bills, etc.)

I'm not holding my breath. Although these people are much more prevalent nowadays, I still do not think that the Obama administration is going to accomplish its goal here. I do believe that we will see some sort of national system eventually, but I'll be well into middle age by then. Sigh.

 

[GTaudiophile]

Originally posted by: ElFenix

Originally posted by: GTaudiophile

The savings as a result of no debt interest payments alone would do wonders for funding.

wat?

I think the US spends nearly 800 Billion a year on federal debt interest payments.

http://www.federalbudget.com/

No federal debt = no interest payments on debt = lots of money available that use to not be.

 

[frostedflakes]

Yeah, it blows my mind how much we spend on interest alone. Money down the drain, basically, and it's only going to get worse with how much Obama's been tacking onto the national debt.

 

[Craig234]

Originally posted by: Mursilis

(And BTW for the various die-hard partisans, I'm not blaming either party specifically - they've both had amble chance to prove they're fiscally irresponsible, and they're both equally guilty.)

No, they're not. Democrats are not blameless, but they're far from equal in guilt.

 

[Craig234]

Originally posted by: BansheeX

Originally posted by: Skoorb
Democrats are tax and spend, republicans are spend and borrow. Maybe Obama can be the first republican democrat, but I doubt it. Ultimately taxes will likely go up to help pay for this huge increase in government under Obama.

It's far more trivial a difference than that. They both do pretty much the same thing, the only difference is Dems campaign on it being a good thing, then do it, while Republicans campaign on it being a bad thing, then do it. The voter hasn't quite figured out how to spot the sincere Republican when it's actually a pretty easy litmus test: do they receive campaign financing from a lobby group? If so, they are not sincere.

Taxes (physical appropriations) serve more of a redistribution purpose, they don't have much to do with the cost of government in a fiat environment unless the cut in taxes corresponds with a cut in spending. This is why it is accurate and common to hear libertarians say that the cost of government is not what it taxes, but what it spends. One of the funny sleight of hands Bush did was lower taxes slightly, but borrow and inflate way, way more than that. It gave him the appearance of being Santa Claus to the sheeple, but in reality the amount he was giving back in the present was negated and then some by the amount he was taking from the future.

You're forgetting a key difference - they both spend a lot, but on very different things.

Democrats tend far more to spend on things that are investments and that help people.

 

[winnar111]

Originally posted by: Craig234

Originally posted by: BansheeX

Originally posted by: Skoorb
Democrats are tax and spend, republicans are spend and borrow. Maybe Obama can be the first republican democrat, but I doubt it. Ultimately taxes will likely go up to help pay for this huge increase in government under Obama.

It's far more trivial a difference than that. They both do pretty much the same thing, the only difference is Dems campaign on it being a good thing, then do it, while Republicans campaign on it being a bad thing, then do it. The voter hasn't quite figured out how to spot the sincere Republican when it's actually a pretty easy litmus test: do they receive campaign financing from a lobby group? If so, they are not sincere.

Taxes (physical appropriations) serve more of a redistribution purpose, they don't have much to do with the cost of government in a fiat environment unless the cut in taxes corresponds with a cut in spending. This is why it is accurate and common to hear libertarians say that the cost of government is not what it taxes, but what it spends. One of the funny sleight of hands Bush did was lower taxes slightly, but borrow and inflate way, way more than that. It gave him the appearance of being Santa Claus to the sheeple, but in reality the amount he was giving back in the present was negated and then some by the amount he was taking from the future.

You're forgetting a key difference - they both spend a lot, but on very different things.

Democrats tend far more to spend on things that are investments and that help people.

Like oil drilling.

Oh wait...