R/R flip flop on lowering taxes for rich, or blatent lie?

Lie or flip flop?

  • Lie

  • Flip flop


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dank69

Lifer
Oct 6, 2009
35,204
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Romney and Ryan sat down with 60 Minutes to tell us that they will not lower tax rates for the rich:

ROMNEY: Well, fairness dictates that the highest income people should pay the greatest share of taxes, and they do. And the commitment that I've made is, we will not have the top income earners in this country pay a smaller share of the tax burden. The highest income people will continue to pay the largest share of the tax burden and middle income tax payers, under my plan, get a break. Their taxes come down, so we're not going to reduce taxes for high income people and we are going to reduce taxes for middle income people.
Source



Romney's tax plan would lower top marginal rate to 28%.
Ryan's tax plan would lower top marginal rate to 25%.

Source

If you go to Romney's website it flat out states that he wants to lower all marginal tax rates. Is this a flip flop or a blatent lie? Right now I'd say pants on fire.
 

Genx87

Lifer
Apr 8, 2002
41,095
513
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What does it matter the marginal rate when the rich derive a large % of their income from investment income which is 15%? You could have a top marginal rate of 99%. They dont pay it anyways.
 

nehalem256

Lifer
Apr 13, 2012
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Romney's tax plan would lower top marginal rate to 28%.
Ryan's tax plan would lower top marginal rate to 25%.

Quoting marginal tax rates as your only "evidence" for lowering/raising taxes on any group of people simply shows your ignorance of the US tax code.
 

crownjules

Diamond Member
Jul 7, 2005
4,858
0
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Quoting marginal tax rates as your only "evidence" for lowering/raising taxes on any group of people simply shows your ignorance of the US tax code.

You're right. They'll be paying much less once you consider all the loopholes they take advantage of and that much of their "income", as Genx points out, is only taxed at 15% because it comes from investments.

But the underlying point is not about the rates. It's the fact that Romney/Ryan are saying one thing and have proposals on record to do another.
 

EagleKeeper

Discussion Club Moderator<br>Elite Member
Staff member
Oct 30, 2000
42,591
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Obama also stated that he would cut the deficit.
and he also stated that he deserved to be a one term president if he did not do such.

saying one thing and doing the other.

What Obama has done is worse than what Romney is proposing>
 

Jhhnn

IN MEMORIAM
Nov 11, 1999
62,365
14,681
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Quoting marginal tax rates as your only "evidence" for lowering/raising taxes on any group of people simply shows your ignorance of the US tax code.

Failure to analyze the R/R tax proposals shows just how far in denial you really are.

Take the proposal where People who earn <$200K would pay no taxes on capital gains, dividends & interest. If your income were derived exclusively from that, you'd have ~$4M of working capital at 5% rate of return. Your net worth would obviously be much higher than that. You'd already be rich by middle income standards, but you'd pay no federal income tax.

If your investment income is $400K, your federal tax rate would be 7.5%. If it were $1M, your federal tax rate would be 12%, a $30K/yr tax cut over the ridiculously low 15% rate of today.

Basic math. Use it.

R&R are obvious liars.
 

EagleKeeper

Discussion Club Moderator<br>Elite Member
Staff member
Oct 30, 2000
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so you increase the cost of the risk of investment to make capital scare? Is that the point?

Investment capital is what drives/expands the country and the Dems want is dried up.
I do not see the SBA dumping money into the private sector for startups?
 

berzerker60

Golden Member
Jul 18, 2012
1,233
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so you increase the cost of the risk of investment to make capital scare? Is that the point?

Investment capital is what drives/expands the country and the Dems want is dried up.
I do not see the SBA dumping money into the private sector for startups?

Investment capital is worthless if there are no customers with money to buy the products made by new companies that would need investment capital. You don't get customers who have extra money when workers don't get raises for several decades and all of the economic growth of the entire country for those decades is in the pockets of a tiny tiny fraction of the nation, who then stick it in banks and investment accounts as investment capital.

Extremes are always dumb, which is why no one should suggest 100% capital gains taxes (and no one does) and no one should suggest 0% capital gains taxes (much the the Republican party does). We need to find a way to encourage that 1% to spend a large portion of their money in (preferably taxable) ways that will grow the economy and get it back into the hands of working Americans, who will then buy more things and grow the economy further. Higher capital gains taxes and a high marginal tax bracket would help with that goal.

Also the federal government sometimes does invest directly in startups, such as with the program that invests in green energy startups. However, though that program has been a net profit for the government and thus saved tax dollars, it did include the fiasco with Solyndra, which definitely merits finding new safeguards to be sure it doesn't happen again.
 

dank69

Lifer
Oct 6, 2009
35,204
28,223
136
Troll poll is troll.
I'm sorry I didn't include the option 'I can use my conservative brain to reconcile why Romney is saying one thing in one place and saying the opposite in another' for you. It wouldn't have fit in the space provided anyway.
 

Jhhnn

IN MEMORIAM
Nov 11, 1999
62,365
14,681
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so you increase the cost of the risk of investment to make capital scare? Is that the point?

Investment capital is what drives/expands the country and the Dems want is dried up.
I do not see the SBA dumping money into the private sector for startups?

Capital isn't scarce- it's just being sucked into the black hole of a liquidity trap. Well, the part that isn't being offshored as fast as possible by the Mitt Romneys of the world.

That liquidity trap is self reinforcing- more saving, less investment, reduced employment, reduced demand. So some alternate method is needed to recirculate that money into the economy- taxes that allow increased govt spending which increases employment which increases demand.

Demand is the crux of the matter, and financialized capitalism can't increase that in a liquidity trap, in a situation where the private sector is undergoing massive deleveraging. The only reason we ever achieved such high leverage was in response to diminished returns of work & employment, anyway. America's wealthiest substituted lower interest rates, bigger lines of credit & longer to pay for wages for a very long time, and we see the results today.
 

Fern

Elite Member
Sep 30, 2003
26,907
173
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-snip-
Is this a flip flop or a blatent lie? Right now I'd say pants on fire.

His plan keeps tax rates for dividends and LT cap gains the same, they are not reduced.

From that angle he is correct, and consistent.

However, those making 'large' salaries would get a tax reduction. (Note that for most CEO's etc the bulk of their compensation is from stock options which are normally taxed as LT cap gain, so they get no tax reduction for that.) So, for those with 'fat' W-2's there is some merit to the claim that the 'rich' get a tax break. It mostly depends of your definition of "rich".

Fern
 
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Fern

Elite Member
Sep 30, 2003
26,907
173
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Failure to analyze the R/R tax proposals shows just how far in denial you really are.

You are making a lot of assumptions, as a professional who has followed tax proposals for many years I can assure you that is a dangerous game.

Take the proposal where People who earn <$200K would pay no taxes on capital gains, dividends & interest. If your income were derived exclusively from that, you'd have ~$4M of working capital at 5% rate of return. Your net worth would obviously be much higher than that. You'd already be rich by middle income standards, but you'd pay no federal income tax.

^ I consider this highly unlikely (and I think that's an understatement) because what you describe is not the intent of such proposals. We have had similar tax proposals for decades, and other countries actually have similar rules. The intent is to encourage savings/investment by middle class (and lower) taxpayers, not provide rich people with the equivalent of $2000,000 of tax-free income.

If your investment income is $400K, your federal tax rate would be 7.5%. If it were $1M, your federal tax rate would be 12%, a $30K/yr tax cut over the ridiculously low 15% rate of today.

Basic math. Use it.

Your first assumption was at least understandable, though wrong. This one isn't even supported by anything in Romney's plan. You're interpreting it to say that the first $200K in investment income is tax-free. No where does it say that.

Fern
 

Jhhnn

IN MEMORIAM
Nov 11, 1999
62,365
14,681
136
His plan keeps tax rates for dividends and LT cap gains the same, they are not reduced.

From that angle he is correct, and consistent.

However, those making 'large' salaries would get a tax reduction. (Note that for most CEO's etc the bulk of their compensation is from stock options which are normally taxed as LT cap gain, so they get no tax reduction for that.) So, fore those with 'fat' W-2's there is some merit to the claim that 'rich' get a tax break. It mostly depends of your definition of "rich".

Fern

You overlook the scenario I laid out, above, wrt "retirees" whose income is derived solely from interest, dividends & capital gains. It covers a lot of trust funders, as well.

Is enormously reducing their federal tax bill, sometimes to zero, "consistent" with not cutting effective rates? Really?
 

Jhhnn

IN MEMORIAM
Nov 11, 1999
62,365
14,681
136
Your first assumption was at least understandable, though wrong. This one isn't even supported by anything in Romney's plan. You're interpreting it to say that the first $200K in investment income is tax-free. No where does it say that.

Incorrect-

Eliminate taxes for taxpayers with AGI below $200,000 on interest, dividends, and capital gains

http://www.mittromney.com/issues/tax

That's exactly what it says.
 

OneOfTheseDays

Diamond Member
Jan 15, 2000
7,052
0
0
Fern is basically attempting to blow smoke up everyone's asses because he is a tax accountant. His very livelihood depends on the bloated, corrupt, tax code we have in place today.

Once we start making changes to make it fair, his job becomes less relevant. Hence the reason why he will fight tooth and nail to keep the status quo.
 

Fern

Elite Member
Sep 30, 2003
26,907
173
106
Incorrect-



http://www.mittromney.com/issues/tax

That's exactly what it says.

It also says this:

Maintain current tax rates on interest, dividends, and capital gains

So, we have contradictory clauses.

IMO, you're trying to read details into a one-line remark and that always leads to errors. As I've said, we've had numerous proposals for middle class etc to have a certain amount of investment treated as tax-free. They have NEVER permitted the 'loophole' you describe.

To interpret up to $200K of investment is tax free is not supportable. If that were the intention, and I'm sure it's not, the plan would simply say that directly.

Fern
 
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Fern

Elite Member
Sep 30, 2003
26,907
173
106
Fern is basically attempting to blow smoke up everyone's asses because he is a tax accountant. His very livelihood depends on the bloated, corrupt, tax code we have in place today.

Once we start making changes to make it fair, his job becomes less relevant. Hence the reason why he will fight tooth and nail to keep the status quo.

You're an idiot. I've called for tax reform here in P&N numerous times.

Eliminating tax on investment income would be contrary to my personal business interests as a tax accountant. Complications with capital gains (tracking basis in stock etc.) force many to seek out professional tax prep services. Any moron can deal with a W-2. Proposals to eliminate investment income on middle class are made not only to promote saving but for simplicity in tax reporting too. As I said, many other countries already do this. Both Germany and France had such a law when lived there. (I haven't checked their laws in a while, but I assume they still have it.)

In Germany, for example, this law basically allows those middle class employees with wages to avoid even filing a tax return. The withholding on your wages is considered sufficient.

Fern
 

Jhhnn

IN MEMORIAM
Nov 11, 1999
62,365
14,681
136
It also says this:



So, we have contradictory clauses.

IMO, you're trying to read details into a one-line remark and that always leads to errors. As I've said, we've had numerous proposals for middle class etc to have a certain amount of investment treated as tax-free. They have NEVER permitted the 'loophole' you describe.

To interpret up to $200K of investment is tax free is not supportable. If that were the intention, and I'm sure it's not, the plan would simply say that directly.

Fern

Those clauses are not contradictory at all, but rather misleading. Romney wants to exempt taxpayers who earn less than $200K from taxes on dividends, interest & capital gains entirely. He reiterates that in the tax policy pdf-

As president, Romney will seek to eliminate taxation on capital gains, dividends, and interest for any taxpayer with an adjusted gross income of under $200,000, helping Americans to prepare for retirement and enjoy the freedom that accompanies financial security.

http://www.mittromney.com/sites/default/files/shared/TaxPolicy.pdf

*Any* taxpayer, Fern, including the ones I mentioned earlier.

I realize that you don't want to believe it, but there it is. It's not what you want to believe it is, at all. If he just wanted to help people save for retirement, he'd want to raise the limits on tax deferred vehicles, broaden what the law defines as a tax deferred vehicle, so forth & so on.

What he proposes is like raising the personal exemption while keeping rates the same. It makes the personal exemption for the investor class quite large.
 
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Matt1970

Lifer
Mar 19, 2007
12,320
3
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Those clauses are not contradictory at all, but rather misleading. Romney wants to exempt taxpayers who earn less than $200K from taxes on dividends, interest & capital gains entirely. He reiterates that in the tax policy pdf-

I highly doubt that would pass even a filbuster proof Senate or Congress.
 

cybrsage

Lifer
Nov 17, 2011
13,021
0
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If you go to Romney's website it flat out states that he wants to lower all marginal tax rates. Is this a flip flop or a blatent lie? Right now I'd say pants on fire.

It is no more of a lie than Obama saying the Bush tax cuts were tax cuts for the rich...while pretending it was not a tax cut for everyone.

Maybe Obama's blazing pants were so darn hot, they caused other people's pants to catch on fire to. What do you think?
 

nehalem256

Lifer
Apr 13, 2012
15,669
8
0
It is no more of a lie than Obama saying the Bush tax cuts were tax cuts for the rich...while pretending it was not a tax cut for everyone.

Maybe Obama's blazing pants were so darn hot, they caused other people's pants to catch on fire to. What do you think?

I think Obama is walking around with his burning pants on the ground :D