Seriously, what's wrong with reducing the corporate tax rate to 15% (or less)?

[werepossum]

I never offered that we should seize & redistribute wealth, merely tax higher incomes at higher rates as an issue of economic self defense for working people. Although the mechanism is poorly understood, extreme concentration of wealth & income creates extreme instability in any economic system, apparently through the mechanism of substitution of excessive credit for wages. It's what happened in 1929, and again at the end of the housing bubble. When wealthy interests are allowed to do that, the effects are disastrous & long lasting. As their holdings increase, the ability to make a profit increases inversely, simply because the ability of the general population to support such profit taking has been diminished. So they take greater risks in the extension of credit, create elaborate mechanisms to conceal that risk, until it falls down simply because of the inability to pay.

It's not like the post WW2 period, when taxes were much higher for enormous incomes, wasn't a period of strong innovation & growth, at all. The notion that innovators will not innovate in the face of high taxes is completely unsupported. The notion that such is the source of most corporate profit in this country is also erroneous. Although the financial sector comprises 10% of GDP, it comprises 40% of corporate profits, and what they "innovate" hasn't been shown to be of real societal benefit, at all.

The notion that I want something for myself is erroneous. As I've said several times, I've done well, and with a little more luck will continue to do so. OTOH, as a member of the middle class, I see the explosive inequality in this country as tearing us apart, as depriving many younger people of the very opportunities that I had. Wealthy people are disinclined to invest in productive endeavors when they can make handsome returns from purely financial transactions which often amount to little more than asset stripping & transfering funds from institutional investors like pensions, 401K's & endowments into the pockets of hedge funds & private equity firms. It is, in all too many ways, a form of looting and of class warfare. "Growth" is meaningless to working people when they don't get a share of it, which is increasingly the case. "Growth" is less than meaningless when the labor participation rate is forced down even when so-called "growth" is occurring.

In the face of increasing concentration of ownership, of increased offshoring, of increased automation we face some stark choices. If we can't reverse those trends, and I suspect that will be extremely difficult, we need to accept the need for greater redistribution of income if we're to continue to have a broad middle class at all, a society where opportunity is also broad as well. We can't possibly thrive as a nation when having a job is a necessity and yet a matter of luck & privilege regulated by scarcity at the same time.

Translation: I don't want to seize and redistribute wealth, I just want to tax higher incomes and higher rates and give that money to people with lower incomes. As long as I don't call it wealth seizure and redistribution, I can continue lying to myself and anyone else with a very weak mind.

I actually agree with you on the dangers of wealth concentration, and I support policies that inherently increase the value of labor such as import tariffs (making it less profitable to move wealth-creating jobs to cheap labor markets) and curtailment of illegal immigration (which likewise increases the supply of labor, thus devaluing it.) However I understand one vital thing you miss. A broad middle class formed by redistributing others' earnings isn't a true middle class, it's an enormous welfare state.

The more we punish hard work and reward or reduce the penalties for not working hard, the fewer people will work hard. The less we reward risk-taking and the more we reduce its rewards, the less risk-taking we will have.

 

[Jhhnn]

You are now claiming that the rich need to have the money taken away from them because as they aquire wealth they aquire too many assets (holdings) making it harder for them to make more money. That is absolutely obsurd. If that were true, they would take even more risks as you have now cut their profits.

Which was exactly what they did during the boom phase, although they managed, as usual, to take their cut off the top & transfer losses into other people's money & onto the taxpayers. The income & income share of America's wealthiest spiked sharply in 2006 & 2007.

The problem was GDP was stagnant till those rates were cut. Since then we have almost doubled GDP every decade.

I will take the rollercoasters, because the stability you refer to equates to equal suffering for all. BYW, we typically a couple recessions per decade and that has been the trend for almost the last 200 years.

Uhh, this isn't an ordinary postwar recession, at all, but rather the inevitable consequence of the greatest looting spree in the history of finance, greater than that leading to the crash of 1929. We just dealt with it differently- ie, the bailout & FRB actions. W/o that, it'd be 1931 all over again, maybe worse.

The rich never suffer during economic hard times, anyway, because they're rich. If anything, their power increases because they're the only ones with liquidity.

 

[Matt1970]

Which was exactly what they did during the boom phase, although they managed, as usual, to take their cut off the top & transfer losses into other people's money & onto the taxpayers. The income & income share of America's wealthiest spiked sharply in 2006 & 2007.



Uhh, this isn't an ordinary postwar recession, at all, but rather the inevitable consequence of the greatest looting spree in the history of finance, greater than that leading to the crash of 1929. We just dealt with it differently- ie, the bailout & FRB actions. W/o that, it'd be 1931 all over again, maybe worse.

The rich never suffer during economic hard times, anyway, because they're rich. If anything, their power increases because they're the only ones with liquidity.

So what would you like to have done with this increased revenue from increased taxes on the rich?

 

[Jhhnn]

Translation: I don't want to seize and redistribute wealth, I just want to tax higher incomes and higher rates and give that money to people with lower incomes. As long as I don't call it wealth seizure and redistribution, I can continue lying to myself and anyone else with a very weak mind.

I actually agree with you on the dangers of wealth concentration, and I support policies that inherently increase the value of labor such as import tariffs (making it less profitable to move wealth-creating jobs to cheap labor markets) and curtailment of illegal immigration (which likewise increases the supply of labor, thus devaluing it.) However I understand one vital thing you miss. A broad middle class formed by redistributing others' earnings isn't a true middle class, it's an enormous welfare state.

The more we punish hard work and reward or reduce the penalties for not working hard, the fewer people will work hard. The less we reward risk-taking and the more we reduce its rewards, the less risk-taking we will have.

Like I said, stark choices. If you think that America's wealthiest will give up the profits from offshoring, automation & the hiring of illegal imported labor, you're delusional. They'd rather have the welfare state, so long as they can loan the govt the money to do it, and so long as the benefits of it to the general population are lower than what they'd have to provide otherwise, like from hiring Americans.

They'll necessarily need to give up much of the profit from financial manipulation, because they're sucking that well dry as we type.

It's not like the welfare state stifles ambition or innovation, anyway, other than in the minds of conservatives. Our european cousins have a much more expansive welfare state while providing their share of innovation, as well. They see itas providing better opportunities for potential innovators, meaning everybody, not less.

This whole notion that vast fortunes are created from hard work is goofy. It's not like billionaires work thousands of times harder than middle or working class people, at all, so we should quit pretending that they do. In general, I'd contend that the people who work the hardest are those at the bottom of the economic foodchain, not the top.

 

[Jhhnn]

So what would you like to have done with this increased revenue from increased taxes on the rich?

Build things, fund research & education- restore & maintain our infrastructure, both physical & human. They sure as hell aren't doing it, despite all the worshipful prose spewed out about job creators.

 

[Matt1970]

Actually many do. A lot of large corporations pay for higher education of their employees. They will sponsor buildings, stadiums, parks, and even roads that help offset tax expenditures.

 

[Jhhnn]

Actually many do. A lot of large corporations pay for higher education of their employees. They will sponsor buildings, stadiums, parks, and even roads that help offset tax expenditures.

Not to match the amount they'd otherwise pay in taxes if the Bush cuts were rescinded, obviously.

Stadiums? For the advertising value of naming rights, huh? The rest? to gain favorable treatment from politicians now beholden to them for favors in their states & districts in many instances, I'm sure.

 

[LunarRay]

Yet once that ceiling is reached, expenditures must match income to maintain the non profit status. In practice, Unions never get there, basically existing hand to mouth with small buffers. They spend what they get, particularly over any time frame longer than a few months or years. Which was what I said in the first place.

I don't know.

I picked up some bits on Non Profit financial reporting from a meeting or something and deduced the rest...

I think this site deals with labor union reporting etc... http://www.dol.gov/olms/regs/compliance/highlights_10.htm#3

The IRS says:

Section 501(c)(5) provides for exemption of labor, agricultural or horticultural organizations. To be exempt, an organization must meet the following requirements:

• The net earnings of the organization may not inure to the benefit of any member; and
• The objects of the organization must be the betterment of conditions of those engaged in the pursuits of labor, agriculture, or horticulture, the improvement of the grade of their products, and the development of a higher degree of efficiency in their respective occupations.

http://www.irs.gov/charities/nonprofits/article/0,,id=96169,00.html

So aside from the above I've no idea about ceilings or any of that..

 

[nehalem256]

No-

http://blog.thomsonreuters.com/inde...abor-force-participation-rate-at-27-year-low/

So it dropped down to 64%. Which still puts in 5% above where it was in the 60s. If it dropped a further 5% that would make unemployment fall to 3.2%, which would be an all time low.

 

[jstern01]

Actually many do. A lot of large corporations pay for higher education of their employees. They will sponsor buildings, stadiums, parks, and even roads that help offset tax expenditures.

Other than offset about some of the cost of higher education (realize that getting a degree from (freshman to graduation) can cost around 40K, most corporations might pay 50% of that.

As for stadiums, parks and roads, that pure bunk. No corporation pays any significant amount for those items, generally they license the naming rights for pennies on the dollar for marketing exposure. Perfect example is the Orlando Arena, Amway Arena the total outlay for that 500 million facility (so far estimates by some accountings is as high as $800 million) by the city and county. Amway corporation cost 50 million.

 

[nehalem256]

Other than offset about some of the cost of higher education (realize that getting a degree from (freshman to graduation) can cost around 40K, most corporations might pay 50% of that.

So it would cost people $5,000/yr out of pocket. I managed that when I was 18. Stop whining.

 

[jstern01]

So it would cost people $5,000/yr out of pocket. I managed that when I was 18. Stop whining.

Difference is that you did not have a family, job, taxes, mortgage and commitments to various conflicting appointment, meetings. At 18, you are still sucking at the teats of your parents and living off them. Most 18 years get college paid for, or subsidized by their parents.

Oh, and suck it up buttercup.

 

[Jhhnn]

So it dropped down to 64%. Which still puts in 5% above where it was in the 60s. If it dropped a further 5% that would make unemployment fall to 3.2%, which would be an all time low.

In the 60's, wages were much, much higher than they are today in a relative sort of way. The pie was distributed a lot differently, and the very changes in economic policy you advocate are the changes that brought more & more people, particularly women, into the workforce. The purchasing power of the median male income has fallen considerably since then, and that decrease was imposed rather than voluntarily acquired. Well, unless you consider that unwittingly voting against one's economic interests is truly voluntary in a knowing way.

 

[jstern01]

In the 60's, wages were much, much higher than they are today in a relative sort of way. The pie was distributed a lot differently, and the very changes in economic policy you advocate are the changes that brought more & more people, particularly women, into the workforce. The purchasing power of the median male income has fallen considerably since then, and that decrease was imposed rather than voluntarily acquired. Well, unless you consider that unwittingly voting against one's economic interests is truly voluntary in a knowing way.

Remember taxes were much higher during the 60's. Yet we had pretty steady economic growth. In fact according to this link, since the 1960's tax rates for the middle, lower have gone down, while they have risen for the rich. But for the ultra rich have dropped significantly.

http://visualizingeconomics.com/2007/11/03/nytimes-historical-tax-rates-by-income-group/

 

[Jhhnn]

So it would cost people $5,000/yr out of pocket. I managed that when I was 18. Stop whining.

As posted elsewhere, youth unemployment is currently enormous, with entry level jobs quite scarce.

If there's whining going on, you're part of the din, complaining about having to actually *pay taxes*, the lowest in the first world, as a result of being relatively successful against the odds. Odds aren't about "hard work", either, but about statistical probability, about luck more than anything else. Lots of people have worked a lot harder than either one of us only to end up with a lot less.

You're probably more lucky than good, which can be a tough thing to accept when putting on airs of moral superiority.

 

[Lithium381]

My remedy is first off, to stop making things worse. When you find yourself in a hole you don't argue about whether you should dig a little more slowly or a little more quickly, you stop digging and take some time to figure out how you got into the hole and how you can get out. There are no easy answers; much of our problem has been looking for easy answers. We can't cut our government in half in any meaningful time frame; our government is simply far too big a part of our economy. We'd be in depression. And we can't raise taxes and/or increase government to get out. The bigger the cart, the fewer people left to pull the cart. The steps I would take (off the top of my head) are:
1. Crack down on illegal immigration. We have a surfeit of labor when we need labor to be more highly valued. I'd establish a path to citizenship AFTER I closed down the border, but it would be what citizens pay PLUS back taxes and penalties PLUS penalties for coming here illegally, only for productive people without criminal records, require speaking and reading/writing legible English, and with a healthy multi-year probationary period. I won't cut off my nose to spite my face by kicking out otherwise law-abiding illegals and importing less Americanized if more law-abiding replacements, but American citizenship is precious and should be valued accordingly.

I agree.

2. Take a hard look at where we need legal immigration increased (such as specific fields of PHDs) versus where business would like to cut costs and then temporarily increase those visas while simultaneously using tax cuts and retargeting spending to incentivize the private sector and public universities to provide more of these fields. Lower general legal immigration quotas, and revise the process. I don't want to know that your cousin is already here or that you're from a critically under-represented country or ethnic group, show me what you bring to the party that I need. And if all you can bring to the table is diversity, sorry. You may want to reapply when I'm not broke and hurting. The one exception might be Asians; we can use some more Asians. And Jamaicans. And hot chicks in general. You want rich guys to start spending money, bring in some hot chicks.

Agree. But once we curb the illigal immigration problem, we should UP the quotas on legal immigration for those with value.

3. Start phasing in real reciprocal trade agreements with other nations. If your nation has a 25% import tariff, inspection fee, or duty on our imported goods, we now have the same 25% import tariff, inspection fee, or duty on goods imported from your nation. To hell with free trade, that's a race to the bottom; I want duty-free trade with only those nations with equivalent or better labor rates and standards of living.

That's asking for a lot. I don't see this hard-line 1-to-1 requirement helping us.

4. I'd increase foreign aid, but make it only in kind. We'll give Egypt a billion dollars worth of Fords or Maytags or Century Wreckers; we won't give them a billion dollars borrowed so that they can cut their best deal elsewhere. Want to build a domestic automobile industry? Fine, but I'm not funding my competitor. And that aid will be dependent on how each nation behaves; if you continually undercut us in the UN or in other ways, you obviously don't need our help. That way we get a nice boost to our manufacturing economy and also a recurring parts sales stream.

Lets fix our own problems at home first, not throw money to other countries. I understand that world stability helps us in the long run but lets be smarter about how we "invest" in other countries.

5. I'd start a dialog with business leaders about what they need, what they want, to manufacture in this country. Then I'd present a list of things I want and do some horse trading. I'll give you tax breaks, but I'll tie them directly to payroll increases. (Head count, not total outlay. $100 million in CEO-level bonuses is NOT equal to 2,000 $50K jobs.) You want this regulation eased, maybe I want 10% cleaner exhaust or 10% better energy efficiency. (Note: This already happens, but the payoff is in campaign donations and jobs for otherwise unemployable relatives and mistresses.)

6. I'd draft a simple plan dropping corporate taxes over ten years to zero while raising short term (say, a year or less) capital gains to be taxed as wage income. Make your money however you want and legally can, everyone gets treated the same. The only corporate taxes I'd have in the end would be on excess payroll on the executive level (I'd have to study the issue to determine how to craft proper guidelines) and on money sent out of the country. Build it here and sell it tax free; import your gidgets and I want Uncle Sam's cut of that money. Stock options tied to company performance I'd tax as wage income; stock options not tied to company performance, so that however the stock price fares the recipient enjoys a nice profit at no risk or investment, I'd tax as wage income plus a 10% penalty, just like early 401K withdrawals. Long term capital gains I'd tax as maybe 3/4 of wage income, after indexing for inflation.

Mostly good, but a little to steep on the "penalties" and such, but I like the idea on the CG

7. I'd put a virtual freeze on government hiring. When someone leaves, he doesn't get replaced, and if necessary we would transfer to fill essential positions.

YES!!!! Shrink the public sector and grow the private sector!!

8. I'd immediately cut every department 5% over two years, with the understanding that the next five years after that we would cut 1% a year. Find the fat, guys, we all have it.

That's very reasonable

9. I'd begin pulling out of every foreign base except South Korea, the only ally currently at war and at risk of being invaded, Afghanistan, and Iraq. Iraq I would put on a training-only, payment basis, where the host nation pays our actual cost if they want us there. I'd offer the same deal to other places, but the vast majority of our bases are neither needed nor wanted except for the revenue we spend maintaining it. Otherwise, if you want us to have a base in case Russia or Red China invades, you can maintain it to our standards and we'll execute a reciprocal agreement - if we're obligated for fight for you, you're obligated to maintain a proportionally sized and equipped force and you're obligate to fight for us. I'd take a portion of the money saved and use it to defend our own border, and I'd take another portion and fund a large fleet of fast heavy haulers so that we can deliver and maintain a fighting force where it's needed, when it's needed. Without the need to maintain so many bases, we could easily cut our overall forces and still increase our combat and combat support troops.

10. I'd start requiring all government grants, purchases, and tax breaks to be for American-made products or American-owned service companies. If the UN wants to make a major stink, I'm fine with getting the US out of the UN and the UN out of the US. About the only thing we have left is that we're the world's most profitable market and I'm tired of giving other nations better terms to come take a piece of it. A leaner group of nations made up of like-minded democratic republics - the UK, the EU, Japan, South Korea - would serve us better anyway, without such atrocities as Yemen or Saudi Arabia chairing the Commission on Human Rights.

11. I'd start phasing out that portion of the EITC beyond what the taxpayer actually paid. No wealth transfers.

I like that, no negative taxes! Wealth transfers are neccesary. I used to be a hard-line and refuse to accept it, but am now starting to realize that it's required. .

12. I'd start removing the cap on payroll taxes. Yes, it sucks that Social Security won''t be there for you if you don't need it. Our previous politicians (which YOU helped elect by action or inaction) spent that money, now it's just another entitlement and just another tax. I want to eventually transition it to an individual account in approved investments similar to that Congress enjoys, but just at the moment we can't afford it.

13. After the first year of actually spending less than the year before, I'd come back to the people and ask to sunset the Bush tax cuts on everyone. We've all dug a hole, and we all need to help pull ourselves out of it. It's going to be a tough few years as we transition back to less consumption and more production, but in the end we'll own our own nation again.

Polititians won't go for this because it will hurt them personally even though it would beneifit the country as a whole. . . . sad really.

EDIT: Forgot to add: 14. Ask Congress for a clean bill legalizing pot and a clean bill legalizing gay marriage. If nothing else that should keep them too busy to commit much Congressiony mischief. And if I get them, I can move all those LEOs chasing pot dealers to preventing the BATFE from arming the cartels and all the gay weddings and honeymoons will be a nice boost to the economy.

Yep, this will help reduce the cost of prison and "investigations" to ZOMG how the 16yo got some MJ!!!!

Mind you, that's all off the top of my head.

 

[JohnOfSheffield]

Translation: I don't want to seize and redistribute wealth, I just want to tax higher incomes and higher rates and give that money to people with lower incomes. As long as I don't call it wealth seizure and redistribution, I can continue lying to myself and anyone else with a very weak mind.

I actually agree with you on the dangers of wealth concentration, and I support policies that inherently increase the value of labor such as import tariffs (making it less profitable to move wealth-creating jobs to cheap labor markets) and curtailment of illegal immigration (which likewise increases the supply of labor, thus devaluing it.) However I understand one vital thing you miss. A broad middle class formed by redistributing others' earnings isn't a true middle class, it's an enormous welfare state.

The more we punish hard work and reward or reduce the penalties for not working hard, the fewer people will work hard. The less we reward risk-taking and the more we reduce its rewards, the less risk-taking we will have.

Used to be that way, welcome to the future.

It's not like that anymore, they will take your cash and work as long as they can use you, if they can't they'll shut down and move.

Now, no one wants trade restrictions but when we do all of the buying and they use us to get theyr economy going into hyperspace...

You tell me, big man, what the fuck are we going to do?

Back in my day you worked in the mine or joined the armed forces after school, one in a thousand got a better job, i wan't one in a thousand.

Now you go to school and then you cash your welfare check.....

How the fuck are you supposed to fix that?

 

[cybrsage]

As posted elsewhere, youth unemployment is currently enormous, with entry level jobs quite scarce.

I would guess it varies wildly by area. In my area, the local Sheetz is hiring, as is the Rita's shaved ice. One of the grocery stores (Weis I think, not sure) is also hiring. They are all part time, low pay jobs, but they are also normally the realm of the youth.

I cannot speak for other areas (obviously), so I suspect some areas have nothing while other areas have a lot.

 

[JohnOfSheffield]

I would guess it varies wildly by area. In my area, the local Sheetz is hiring, as is the Rita's shaved ice. One of the grocery stores (Weis I think, not sure) is also hiring. They are all party time, low pay jobs, but they are also normally the realm of the youth.

I cannot speak for other areas (obviously), so I suspect some areas have nothing while other areas have a lot.

No you fucking retard of a wise and beautiful woman, seriously, this isn't funny.

Shut the fuck up if you don't have an answer becaus werepossum knows everything so FUCKING well and will surely present an answer worthy of fifty men.

My son and my son in law are both working, my daughter is home with a kid until her studies are finished then she'll work too. I got this for my family.

She has about 30 20 year old friends, all with higher education, you're gonna fix it for them or are you just assuming that they don't want to work?

They'll get build jobs as they come around but are they useless human beings? i could employ the rest in my not yet to be determined business. I might have to take one or two down to the cliffs and push him right off out of sheer frustration though.


So you tell me, motherfucker, what should i do, just say no to drugs... i got that one but other than that... ?

Need someone who's extremely hard working and can explain quantum theory in a far away land?

 

[JohnOfSheffield]

I would guess it varies wildly by area. In my area, the local Sheetz is hiring, as is the Rita's shaved ice. One of the grocery stores (Weis I think, not sure) is also hiring. They are all party time, low pay jobs, but they are also normally the realm of the youth.

I cannot speak for other areas (obviously), so I suspect some areas have nothing while other areas have a lot.

Is this in a real city or fantasy land because i can think of at least three people to send to you.

 

[DCal430]

I wouldn't mind eliminating Sales and Corporate Income tax and implementing a 25% subtraction method VAT this would include food too.

 

[JohnOfSheffield]

I wouldn't mind eliminating Sales and Corporate Income tax and implementing a 25% subtraction method VAT this would include food too.

Yeah, that is because you are insane.

 

[nehalem256]

Translation: I don't want to seize and redistribute wealth, I just want to tax higher incomes and higher rates and give that money to people with lower incomes. As long as I don't call it wealth seizure and redistribution, I can continue lying to myself and anyone else with a very weak mind.

It worked with the Republicans and the refundable EITC.

 

[cybrsage]

No you fucking retard of a wise and beautiful woman, seriously, this isn't funny.

Potty mouth AND a direct personal attack upon me at the same time. Is that what they teach you in the special forces, to lose control of your temper and do stupid things because of it?

So you tell me, motherfucker, what should i do, just say no to drugs... i got that one but other than that... ?

Need someone who's extremely hard working and can explain quantum theory in a far away land?

Your unemployed compatriots either live on the government dime, live on the street, or take the low paying, part time jobs that are available if they are willing to take them. Which of those choices have they selected?

 

[cybrsage]

Is this in a real city or fantasy land because i can think of at least three people to send to you.

South Central Pennsylvania. All over the Harrisburg-Lancaster-York area. If they are willing to work part time, and can get a work visa, tell them to come over. They cannot be criminals, though, you can keep the criminals over there with you. Law followers and hard workers are always welcome.