Out Of Their Anti Tax Minds

[fskimospy]

This is largely true. The only thing holding back Obama from passing full-on socialized medicine (with Hillarycare criminal penalties for daring to use your own money to provide for your own health care) is that Democrat politicians' highest priority, just like Republican politicians' highest priority, is ensuring their own re-election, and preferably advancement. Passing such a bill would have ensured Republican control of Congress in 2010, probably with a filibuster- and veto-proof Senate majority, and a Republican in the White House in 2012. Good little socialists should be proud of Obama, he got the very most he could have gotten without ensuring that Republicans swept in and dismantled it all.

Well you're right that politicians #1 priority is ensuring that they stay in office, but your ideas for what would have happened in the Senate would actually have been all but physically impossible. Only 19 Democratic seats were up for election in 2010, meaning that only if they had lost every single one would the Republicans have had a filibuster proof majority, and it was completely impossible for them to have a veto proof majority.

EDIT: And even a filibuster proof majority victory would have had to include Republicans winning Senate seats that the Democrats won by 33 points in the 2010 election as it actually happened. Pretty amazingly unlikely.

 

[Fern]

Hah, you misspelled "credit". How embarrassing.

LOL

Fern

 

[Fern]

I think your version of history is getting fuzzy.

Todays Obama care is yesterday's Repub Care.

http://www.kaiserhealthnews.org/Stories/2010/February/23/GOP-1993-health-reform-bill.aspx

From you link:

In November, 1993, Sen. John Chafee, R-R.I., introduced what was considered to be one of the main Republican health overhaul proposals: "A bill to provide comprehensive reform of the health care system of the United States."

Titled the "Health Equity and Access Reform Today Act of 1993," it had 21 co-sponsors, including two Democrats (Sens. Boren and Kerrey). The bill, which was not debated or voted upon, was an alternative to President Bill Clinton's plan.

It didn't go anywhere. It didn't have broad Repub support.

Fern

 

[fskimospy]

From you rlink:



It didn't go anywhere. It didn't have broad Repub support.

Fern

That's not why it didn't go anywhere. It certainly had considerable Republican support. When something is cosponsored by almost half of your caucus, including the leadership, it has support. I don't know why you keep trying to deny this.

Are you trying to say that the Republican party has not become much more conservative now than it was in 1993? If so, what are you basing this on?

 

[Fern]

-snip-
Accelerated depreciation is a subsidy. When and why was the accelerated depreciation first put into existence? Why was it extended? What is the base deduction--the deduction allowed prior to the change(s) made?

Accelerated depreciation was not allowed because it better reflects the real world. Originally part of the Job Creation and Worker Assistance Act of 2002, it was extended by the Economic Stimulus Act of 2008 and further extended by Obama's stimulus.

Depreciation is a valid deduction, accelerated depreciation is a valid deduction, but lets not pretend that accelerated depreciation of corporate jets isn't a type of gov't subsidy.

Nope, no and no.

Acelerated depreciation has been around practically forever. And I don't mean just GAAP (Generally Accepted Acounting Methods), but for use in income taxation as well.

Here, read this:

Tax deductions for depreciation have been allowed in the U.S. since the inception of the income tax. Prior to 1971, these deductions could be computed in a variety of manners over a wide range of lives, under old Bulletin F. In 1971, Congress introduced the Class Life Asset Depreciation Range (ADR) system in an attempt to simplify calculations and provide some uniformity. Under ADR, the IRS prescribed lives for classes of assets based on the nature or use of the asset. Such classes included general classes (such as office equipment) and industry classes (such as assets used in the manufacture of rubber goods). Taxpayers could use their choice of several methods of depreciating assets, including straight line, declining balance, and sum of years digits. Asset costs and accumulated depreciation were tracked by “vintage accounts” consisting of all assets within a class acquired in a particular tax year. All vintage accounts for the same year were assumed placed in service in the middle of the year; however, a taxpayer could elect the modified half year convention with potentially favorable results.

In 1981, Congress again changed the depreciation system,[2] providing generally for shorter lives for recovery of costs. Under the Accelerated Cost Recovery System (ACRS), broad groups of assets were assigned based on the old ADR lives (which the IRS has updated since). Taxpayers were permitted to calculate depreciation only under the declining balance method switching to straight line or the straight line method. Other changes applied as well.

The present MACRS system[3] was adopted as part of the Tax Reform Act of 1986.

BTW: Declining Balance depreciation and sum-of-the-years depreciation are both types of accelerated depreciation.

And yes, acclerated depreciation does reflect 'real word' much better. For any type of tangible equipment that is unquestionable. For real estate? Straight line may be more accurate, depending upon the building use among other things. But the latter is irrelevent since only staright line is allowed for purposes of computing income tax anyway.

And again, depreciation != subsidy. Not even close.

Fern

 

[ProfJohn]

That's not why it didn't go anywhere. It certainly had considerable Republican support. When something is cosponsored by almost half of your caucus, including the leadership, it has support. I don't know why you keep trying to deny this.

Are you trying to say that the Republican party has not become much more conservative now than it was in 1993? If so, what are you basing this on?

Check out the congressional action for the bill:
http://thomas.loc.gov/cgi-bin/bdquery/z?d103:SN01770:@@@X

If it had wide support how come they never talked about it beyond the day after it was introduced?

Look more like a political ploy than anything else. A bill introduced for the sake of looking like you are doing something.

 

[werepossum]

Well you're right that politicians #1 priority is ensuring that they stay in office, but your ideas for what would have happened in the Senate would actually have been all but physically impossible. Only 19 Democratic seats were up for election in 2010, meaning that only if they had lost every single one would the Republicans have had a filibuster proof majority, and it was completely impossible for them to have a veto proof majority.

EDIT: And even a filibuster proof majority victory would have had to include Republicans winning Senate seats that the Democrats won by 33 points in the 2010 election as it actually happened. Pretty amazingly unlikely.

Good point. A fully Republican Congress would have had to waited until 2012.

 

[thraashman]

Good point. A fully Republican Congress would have had to waited until 2012.

Which is the same year that pigs fly and the world is going to end according to the Mayans. Any other ridiculous fantasies you have?

 

[Fern]

-snip-
Are you trying to say that the Republican party has not become much more conservative now than it was in 1993? If so, what are you basing this on?

Not sure if they are more conservative since 1993. I'd base that on the Bush years and people like McCain.

Fern

 

[ProfJohn]

Good point. A fully Republican Congress would have had to waited until 2012.

Republicans are almost certain to take control of the Senate in 2012.

There are 23 Democrat seats up and 10 Republican seats.

Republicans only have to win 3/4 of the following in order to tie or take the lead.
The +/- is how much McCain won or lost the state in 2008.
Missouri +.13%
Montana +2.3%
Nebraska +14%
North Dakota +8%

That is 4 right there.
Interesting stat: "over the past three decades, nearly three of every five truly competitive Senate races, decided by 53% to 47% or less, went the way of the presidential election winner in each state."
So if Obama wins he might hold the Senate, but if he losses then it switches for sure.

 

[ProfJohn]

Not sure if they are more conservative since 1993. I'd base that on the Bush years and people like McCain.

Fern

No, he is right.

Both parties have move to the left/right, at least in congress.

This mainly do to the elimination of Liberal Republicans and Conservative Democrats.

 

[fskimospy]

Check out the congressional action for the bill:
http://thomas.loc.gov/cgi-bin/bdquery/z?d103:SN01770:@@@X

If it had wide support how come they never talked about it beyond the day after it was introduced?

Look more like a political ploy than anything else. A bill introduced for the sake of looking like you are doing something.

Because the Democrats controlled the chamber, and the majority leader decides what bills come up for debate and vote.

 

[brencat]

Just saw this... cute cat!

 

[Shallok]

And again, depreciation != subsidy. Not even close.

Fern

I haven't said anything about accelerated depreciation (or depreciation) in general, only accelerated depreciation in the context of the specific case of corporate jets--in this case accelerated depreciation that was enacted in order to encourage businesses to buy jets in order to stimulate the economy.

If the tax code is changed in order to stimulate a business, then yes its a subsidy.

Again, please explain the difference between allowing a business to book an extra 20% of depreciation in the first year in order to stimulate the economy and the government sending a check to the business for the amount the tax liability decreased in order to stimulate the economy. Is it just that doing it through the irs makes you feel better?

Accelerated depreciation for corporate jets was not put into place to better reflect the real world, and when you are talking about a 5 year schedule for an asset that is going to be in service for 20+ years claiming anything about its depreciation reflecting the "real world" is a fucking joke. If you want to discuss the merits of various depreciation methods sometime, I'm game, but that is a separate conversation.

I know you are a tax guy, and that's great. I had a bunch of friends on the tax track, but please try to read what I've written and not whatever it is that you have been reading.

 

[fskimospy]

Not sure if they are more conservative since 1993. I'd base that on the Bush years and people like McCain.

Fern

By every measure I am aware of, they have. The most commonly used ideological measure is the DW-NOMINATE score, and the scores of Republicans (particularly in the House) have become radically more conservative in the last 20 years.

Basically the score is an algorithm based on how a member of Congress votes that allows comparisons between different years. It goes from 1(most conservative) to -1 (most liberal) The mean DW-NOMINATE score in 1993 for Republicans in the House was about .36 or so. The mean score for a Republican in the House in 2009 was projected at .48, and I imagine after the 2010 election it's over .5. The mean score for a Democrat in the House in 1993 was about -.35, and in 2009 it was projected to be at about -.41.

Both parties have become more polarized for various reasons, but the evidence clearly points to the Republicans having become more radical over the last 20 years both in absolute terms and in comparison to the Democrats. The average Republican has become more conservative than the average Democrat has become liberal.

 

[Fern]

I haven't said anything about accelerated depreciation (or depreciation) in general, only accelerated depreciation in the context of the specific case of corporate jets--in this case accelerated depreciation that was enacted in order to encourage businesses to buy jets in order to stimulate the economy.

As the information I provided above demonstrates, accelerated depreciation has been around much longer than corporate jets. So, accelerated depreciation was not enacted to encourage businesses to buy jets.

I'm unaware of anything that's ever been enacted to specificially encourage the purchase of corporate jets. AFAIK, there is no special legislation for them.

If the tax code is changed in order to stimulate a business, then yes its a subsidy.

We have many different words in the English language for a reason - to more accurately communicate.

In politics we have increasingly seen words basterdized to generate a political affect. I wouldn't be surprised if when a politician speaks of "subsidies" many people think Uncle Sam is actually writing out a check. Of course, that's what the politician wants, they're promoting confusion.

A FAR better term would be "tax breaks". (Even though there is none specifically for jets)

Again, please explain the difference between allowing a business to book an extra 20% of depreciation in the first year in order to stimulate the economy and the government sending a check to the business for the amount the tax liability decreased in order to stimulate the economy. Is it just that doing it through the irs makes you feel better?

The objective is too more accurately determine profit/loss. Acc. dep. does that for the reasons I've previously explained.

Yes, politician can and do monkey with deductions to encourage businesses to run and buy stuff. A far better example is the section 179 election which allows for the full expensing of equipment in the year of purchase. Basically it is a 'timing difference'. The total amount deducted doesn't change, you just get it faster meaning you benefit from the time value of money (you're saving some interest).

Accelerated depreciation for corporate jets was not put into place to better reflect the real world, and when you are talking about a 5 year schedule for an asset that is going to be in service for 20+ years claiming anything about its depreciation reflecting the "real world" is a fucking joke. If you want to discuss the merits of various depreciation methods sometime, I'm game, but that is a separate conversation.

Again, accelerated depreciation was not put into place specifically for jets. You keep acting like it was.

Looks to me like corporate jets are depreciated over 7 - 12 years, depending upon which rules apply. IDK if 7-12 years is too short or not. I know some aircraft are last longer than that, but do not know if the age of the jet means so much maintenance costs that it's value is low etc.

Now we have seen, at times, useful lives being adjusted, perhaps even to encourage sales. E.g., at one time real estate was 15 years. Clearly the building is good for longer than 15 years. But on the other hand, you cannot get a loan (notwithstanding residential prop) for anything longer than 15 yrs. While this doesn't make sense from the pure accounting POV, it does make economic sense. Over those 15 years you're going to be making actual cash outlays (mortgage payments which are non-deductible), so they more-or-less matched the deduction to those expenditures (putting them on a cash basis).

Obama started all this crap himself. There is no subsidy for corporate jets. Corporate jets have no special benefits that I can see; they are treated like any other asset used by a business to earn it's profit. It's just that "corporate jets" sound sexy. It's an emotional ploy of no substance or validity.

Fern

 

[Shallok]

As the information I provided above demonstrates, accelerated depreciation has been around much longer than corporate jets. So, accelerated depreciation was not enacted to encourage businesses to buy jets.

I'm unaware of anything that's ever been enacted to specificially encourage the purchase of corporate jets. AFAIK, there is no special legislation for them.

I've grown tired of this. Look at the three stimulus bills of the past 10 years and their creation of a special and temporary increase in depreciation of certain assets and the provision added to the tax code in 1987 changing depreciation schedules for corporate jets to 5 years while leaving commercial jets untouched.

Or don't and keep tilting at windmills.

I, though, am tired of seeing your response to the gov't allowing bonus depreciation (or countless other changes to the tax code) in order to stimulate the economy somehow magically instead being done to better reflect the real world. Or are you going to start claiming that the 2008 stimulus which allowed the accelerated depreciation (referred to as bonus depreciation) for assets placed into between Dec. 31, 2007 and Jan. 1, 2009 still somehow was done to reflect the real world?

 

[Fern]

-snip-

You started out on "accelerated depreciation" and now you're on to other unrelated provisions.

Section 179 and/or "bonus depreciation" != accelerated depreciation. They are different things.

Fern