Perhaps but if they can't drive anything, then that's pointless. Giving handouts doesnt work either. Look at Bush's 2001 tax rebate checks. Then look at this year's rebate checks. What happened? Obama's tax breaks for the poor are really handouts and giveaways. Sure its great to help the middle class, but when many don't pay income tax already then what?
Perhaps but if they can't drive anything, then that's pointless. Giving handouts doesnt work either. Look at Bush's 2001 tax rebate checks. Then look at this year's rebate checks. What happened? Obama's tax breaks for the poor are really handouts and giveaways. Sure its great to help the middle class, but when many don't pay income tax already then what?
So our federal government gets screwed, so then what? We take more from the rich to make that up.
Why shouldn't people who earned the wealth be able to "control it"? And what do you mean by "control the wealth"? Why should people who don't earn anything control other people's money?
Wrong. It's entrepreneurs that drive the economy. The "low class" are just riding the coattails of someone who's willing to risk their money and provide them a job.
Since "tax cut tax cuts" doesn't work you're going to assume "tax increase tax increase" is the way to go?
Standard economic theory holds that those 'rebate' checks bounce around the economy 7 times
And btw - if you make minimum wage and have no dependents (claim yourself) this is what your paycheck looks like ...
Gross pay: $286.00
Federal income tax: $17.80
Social Security: $17.73
Medicare: $4.15
North Carolina: $14.00
Net pay (take home): $232.32
Payroll Withholding Tax Calculator
There is a withholding of 10% (or 6% if you claim yourself) for Federal tax unless the individual pays no withholding the previous year (no tax liability) and files an updated W-4 claiming exempt status.
You avoided my question.
Here. I'll type it very slowly for you ...
Feel free to explain as to the meaning of GDP increasing 42% while individual income tax receipts only increase 21% in the last 8 years. Extra credit will be given if your response includes reference to the doubling of the Federal Debt over the last 8 years with an 'IOU' obligation to social security now approaching $3 trillion.
VooDoo Economics does not work.
Bush's 2001 rebates didnt work so well. That's why he pushed harder for the cuts that came in 2003. Marginal rates cuts have more of an effect. Now whether the effect is good or bad is up to you to decide.
Don't expect much from the 2008 rebates either.
Although press stories emphasizing that the rebates induced additional consumer spending were technically correct, they missed the important point that the spending rise was very small in comparison to the size of the tax rebates.
No, not when our economy is in a sh!thole. Government shouldn't raise taxes when the economy is bad.
I'm a supporter of trickle down, but I wonder if any studies have been done to show that they are essentially equal. What I mean is that if you tax the rich/businesses more, they hire less but the lower people spend more so they rich can hire more and make more money. Or if you tax the rich/business less, they hire more, creating more jobs for lower income people and the now the lower income have more jobs and income thus buy more.
Seems like it doesn't matter what way it is executed so long as it is done in moderation -- is there a tipping point somewhere?
Seems like it doesn't matter what way it is executed so long as it is done in moderation -- is there a tipping point somewhere?
Control in this case is analogous to "own." And there are a multitude of reasons why the concentration of wealth is a bad idea.
To start, especially for the free market capitalists here, you might want to look up the Heckscher-Ohlin model of international trade. Because the US is factor rich in capital, capital does very well with free trade. However, most Americans have little to no capital. This applies even more so if you consider that most Americans' only real equity is their home, which is now an extremely illiquid asset. Those Americans that labor for a living will get destroyed by countries that are labor rich, such as China, as they can produce goods more efficiently.
Secondly, money is not just a cotton cloth with pretty ink. Money represents much more. Money is the means to influence, power, and control. To concentrate so much power and control in the hands of very few people is to replace one governing entity with another.
Thirdly, we have no protection from the ruling class. As much as conservatives despise the government, at least we have a constitution to protect us from it. Many corporations (and therefore board of directors) work with budgets and power that many countries would envy. The government is our only counter-valence to protect us from the ruling class. By promoting the concentration of unregulated power, you put your fate in the hands of people who are not personally accountable to you. I'd choose the entity that at least is supposed to have our united interests at heart.
Fourth, history is littered with societies that failed when too much power was concentrated in the hands of too few. Do you really think it's a good idea to have a small class of rulers and a large class of peasants? The funny thing you'll see is that the true rich and ruling class don't constantly complain about the poor or welfare. The truly powerful understand that it is better to ensure that the poor have food and distraction rather than discover that the only thing that stands between your home and an armed angry mob is a piece of paper that claims you are the owner.
Fifth, since you didn't read my article, I'm assuming you also ignored my post. The bottom quartile of wage earners only earned 4% of all income. They did earn something. These are the working poor. Their labor contributes to A) their corporations and B) their society. In some ways, handing capital to these people is acknowledging that they are going to get f**ked by the international free market while taking capital from people who are benefiting greatly. This is done for the aforementioned reasons. Judging by the pace of wealth concentration, I'd hardly consider taxation to be a huge burden.
If you'll notice, the constant rambling of people who hate wealth redistributions usually comes from those firmly in the middle-class. It's a ruse. The middle-class, along with the working class, has fared worse since the adoption of trickle down economics. Faster than the wealth pie has been growing, the rich have been gobbling it up. In our international economy, people who have no capital in our country are placed in an extreme disadvantage. Taking some of that wealth (certainly not a crippling amount) and giving it to those without capital is a method to promote the general welfare.
Listen, I despise the idea of "welfare queens" abusing the system and leeching off the system. People should not be rewarded for having children, etc. I just recognize the reality of the present situation. The poor aren't in control, the wealthy are. My cause is the cause of the working poor and the middle-class and we have far more to fear from the ultra wealthy than we do from welfare recipients. Jesus, look at how their poor decisions have almost sent our country into another depression. I also recognize that a society where wealth is so unevenly distributed is a society destined to failure or adopt slavery.
Besides, the discussion is moot. Even under a flat tax system, the rich are going to end up paying most of the federal tab. Simple mathematics. And we do need at least some federal tax, right?
Wow, for once we can have an intellect discussion here. Here is my 2 cent. I believe that during economy hardship, increasing tax rate made the situation worse most of the time. I will give an example, in Chicago, we have the highest sale tax rate in the whole country, 10.25%. If one were to made a major purchase like a HDTV or furniture, people would try to get out of the Cook Country limit for the purchase so they can save on the tax. Something cost $1,000.00 would cause $102.5 tax in Cook county, not a pretty sight. Base on this, we can tell higher tax rate would only push business opportunity away into other. The same can be apply to income tax, if we increase the tax rate on the business that with a profit of $250,000.00 or above, they would react in a way to keep their profit high in order to please the stockholder or the value of the stock would tumble. They would try laiding off people or made the price of the goods higher in order to cover the cost in the tax. Which is not really good to the already slow economy.
- Oct 30, 2000
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Why give another handout to those that are all ready getting handouts?
The small amount is not being turned into spending that will create new jobs and it is not being pooled with other handouts to increase economic activity.
How many plan on living on handouts because they know that the government will provide a safety net?
Our tax system has not become more progressive. I'm not sure if you were the one trying to argue this in another thread a few months back, but it's simply not true.
As far as trickle down economics goes, it's been widely discredited for going on two decades. Simply put, giving rich people more money has not made the rest of us more rich. Shocking, I know.
Well, gave more money to the rich is not suppose to made normal people richer. Rather, it is to promote business growth for the rich so they would hire more people, thus increase employment in the working class.
The overall system may not when you include capital gain but the federal income tax system has. The % of federal income tax recipts paid for by the lower income earners is decreasing and will continue to do so under Obama when he passes his refundable credits.
And nowhere in my response was I arguing about trickle down or supply side economics.
So if a plumbing company that has 10 drains to clean each day, gets a tax cut, and hires more plumbers to clean the same 10 drains?
NOPE
imo tax breaks turn into profit not jobs.
Yes, this is because wealth inequality is growing more extreme. As more wealth is concentrated in fewer hands, fewer people will comprise the bulk of federal taxation. As wages for middle and lower income Americans remain stagnant or decline, they will be paying a lesser percentage of federal taxes. This has nothing to do with tax structure, it merely speaks to wealth inequality.
The tax structure itself has grown more regressive.
In other words, the tax structure has grown more regressive and wealthy inequality is growing rapidly.
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Those that play the tax credit game, hope that if the credit is for another plumber, the company will go out and find an extra few drains for that plumber.
Fern
Elite Member
- Sep 30, 2003
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I still contend we do not have the data to answer Atomic Playboy question.
1st is only a survey.
But the real problems are much deeper.
When you get to wealthy preople, the picture is very highly complicated for a number of reasons:
1. Who owns the assets?
Unlike most of us, with stock accounts and a home or two that we own in our own name, Their assets are usually spread out through many different kinds of entities. This is done for estate tax and liability reasons, among others.
An example would be irrevocable trusts. While we might consider those assets "theirs", legally they are not. They won't show up on any form/survey. Technically, we might consider their beneficial interest as their property, but it will be valued very rarely (like upon death or gift) and is rather complicated. We'll never be able to get that quantified.
2. Closely held corporations etc
Assets held in corps or LLC's ("C" and "S" types) and partnerships; and I don't mean publically traded as those values are readily obtained. But closely held corps, and these are extremely difficult to value. While some value for their stock would be included, if that outside value (the stock) matched up with the inside value (net assets held within the corporate entity) it would be a miracle. Inother words, the combined value of the outstanding shares would not likely equal the value of (net) assets held within the company.
3. What value to use?
Book/cost vs FMV. While an age old controversy, we in the US still mandate book or historical cost accounting in finances. I.e., even if there were NO seperate entity complications, the only available value for assets for assets (in most cases) in the cost value; again if that matched actuall FMV is would be a miracle.
3. Who paid what in taxes?
Many of the sperate legal vehicles used to *hide* or protect assets pay their own income taxes. Even if you could somehow allocate all those asets held with in to an actual person, it would be another tremendous task to allocate all those entities tax payment further to the individuals.
BTW: That survey goes to the fed, no? Well they can't get individual IRS/tax info as it is illegal.
I've worked in a number of other countries, we are by far the most likely to employ complicated structure.
Many other countries have a wealth tax in addition tp income tax. The wealth tax is part of the tax return. Nothwithstanding the ownership and valuation complications, they have a pretty convenient and effective method to determine the data Atomic Playboy asks about. We simply don't. The best we have are guesses.
Fern
Muse
Lifer
- Jul 11, 2001
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I like what he's saying will be his tax policies. I'm not so sure about his health care proposals. However, I think he may be taking the expedient tack on health care. He doesn't want to get up the dander of the insurance industry or the AMA, now does he? We shall see what transpires.
I think the issue of a closely held c corp is that it most likely carries substantial assets and unrealized gains that have most likely never been taxed - simply carried forward for years. Even with declining real estate values this year major assets built 10 or 20 years ago are being written off at their original basis (except for those that may have fallen in the whole 1980's ACRS stuff). The asset may have 1/25 of the original 1988 value left on the books today in a closely held corp because they have depreciated the actual cost over the last 20 years. That thang is worth a boatload, now.
IIRC, the slick move 20 years ago would have been to hold the asset personally and lease it back to the corp. The lease payments retire your debt and the income is offset by depreciation and interest on the loan. Upon disposal the individual would only be taxed at the current capital gains rate on the accelerated basis and wouldn't have to deal with the 'double taxation' c corp thing.
Most likely the decision was made years ago not to convert to s status. Everybody has their own strategies. I tend to want to take my tax 'bite' now because you never know what the future holds - but I go the other way, too. I've got a little of that useless mountain dirt in the Blue Ridge that I bought 20+ years ago. If you're from the western piedmont you know how that's going.
If I was smart I'd bundle it up, unload it, take my tax bite and move on, but that's not gonna happen. I could say "Obama's going to raise my taxes 33%!" but all things being relative that's nothing compared to the gains I hope to realize down the road.
btw - The Fed study is pretty good - as is the IRS information. The 'information' is available in the way that it is bundled without identification of any specific individual.
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