The 2% Illusion

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Dec 10, 2005
24,087
6,898
136
Originally posted by: Skoorb
I love how canceling"tax breaks" is not the same as raising taxes, as if a certain tax rate is written in the bible and anything less is an unnatural tax break.

I love how people talk about these "tax breaks" for people in the top 2%, but if you're making $100k through ~$500k (through earned income), you're an AMT tax payer, so the ignorant masses think you got some kind of massive tax cut when in reality, you probably just saved bupkiss. The real tax savings came from those making a majority of their money through passive income.

Plus, it's all bullshit trying to single out one group. If you need more money and want to raises taxes, raise taxes for EVERYONE; this is a mess where everyone should be chipping in. Even if the people just above the poverty line are just giving $1, at least they are getting something.
 

Xavier434

Lifer
Oct 14, 2002
10,377
1
0
Originally posted by: CycloWizard
Originally posted by: Xavier434
But apparently some people think you can make a poor man rich by making a rich man richer. We've all seen how that has worked out as of late...
The fallacy here is that the government can make someone rich or improve their quality of life. Not only is that not what the government is supposed to be doing, they are terrible at it. I saw people here earlier complaining that we should have taxed Bill Gates more rather than let him give 95% of his money to charity - why? Private charity is demonstrably more efficient than government at lifting up the needy and causing real change. Until people realize that government is often the problem and not the solution, we'll continue to circle the drain.

The government has not made me rich (nor should it), but they have improved my quality of life a lot. They are not as inefficient as you may think. Such accusations are case dependent.
 

winnar111

Banned
Mar 10, 2008
2,847
0
0
Originally posted by: Brainonska511
Originally posted by: Skoorb
I love how canceling"tax breaks" is not the same as raising taxes, as if a certain tax rate is written in the bible and anything less is an unnatural tax break.

I love how people talk about these "tax breaks" for people in the top 2%, but if you're making $100k through ~$500k (through earned income), you're an AMT tax payer, so the ignorant masses think you got some kind of massive tax cut when in reality, you probably just saved bupkiss. The real tax savings came from those making a majority of their money through passive income.

If by bupkiss you mean tens of thousands of dollars..in any case the Democrats are the AMT party.
 

Zebo

Elite Member
Jul 29, 2001
39,398
19
81
FAIL - you only look at simplistic AGI

One could REALLY raise taxes and collect corresponding revenue by eliminating and reducing exclusions, exemptions, deductions and depreciation schedules.

This is what I'm watching for. Nuts and bolts not the paint job.
 

BigDH01

Golden Member
Jul 8, 2005
1,630
82
91
Originally posted by: CycloWizard
As Lincoln said, "You cannot make a weak man strong by making a strong man weak and you cannot make a poor man rich by making a rich man poor." I thought this piece might be enlightening for a lot of people here.

Not really. Once again, he claims that without a low income tax that the incentive to generate wealth will be destroyed. He apparently neglects to tell people that the rich in the US paid a much higher marginal rate in the past than they do now. And guess what, people still created businesses and jobs. The government is not taking all of your money, if you earn a million next year, for every dollar beyond that you earn, you still get to keep most of it. There is still an incentive for you to earn more.


The author clearly indicates that he has no idea what Marxism really is. In that way, he is no different from many people on this board that keep throwing around the term "Socialism" but always back down and ignore my request to 1) describe it and 2) detail how the United States is transforming into a Socialist nation by increasing progressive tax rates (a concept embraced by even Adam Smith). And if the author wants to maintain a veil of impartiality, he probably shouldn't write articles like this.

The America of now is one where Orwellian logic rules. Forced redistribution of wealth is fairness. Taxes are patriotic. The free market should be a regulated market. Big government is good for you. Politicians know what kind of healthcare is best for you. Choice should be limited, except when it comes to abortion. Power comes from being powerless. Progressive education is designed to promote progress toward socialism. Race doesn?t count unless a person of color tells you it counts. Higher education gets lower each year. Those who create our problems should be asked to solve them. Religion should be a private matter that does not inform public morality. Liberal is radical. Free speech is selective speech. Courage is impetuousness.

Yeah, sounds like a reasonable guy. Let's break it down...

1) Orwellian logic - Yes, surely the Bush administration was model of truth and transparency and never used propaganda and misinformation to further their goals. Every politician and political party does this, but the fact that he says this about an Obama election raises some huge red flags and lets me know of the bat that this guy is a partisan hack, nothing more.

2) Forced redistribution of wealth is fairness.... Even Adam Smith said this was fair.

The necessaries of life occasion the great expense of the poor. They find it difficult to get food, and the greater part of their little revenue is spent in getting it. The luxuries and vanities of life occasion the principal expense of the rich, and a magnificent house embellishes and sets off to the best advantage all the other luxuries and vanities which they possess. A tax upon house-rents, therefore, would in general fall heaviest upon the rich; and in this sort of inequality there would not, perhaps, be anything very unreasonable. It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.

The US has used progressive taxation in the past and in a much more punishing and progressive manner. To say that Obama is now the harbinger of redistribution is a lie and ignores the last century of US tax policy.

3) Paying your taxes is patriotic... so he believes the antithesis is true? If I quit paying my taxes would you call me a patriot? There is nothing patriotic or non-patriotic about it, it is fulfilling my civic and lawful duty.

4) The free market should have some regulations in place. You see the CDS catastrophe approaching? CDSs were used because they didn't fall under insurance regulations. You see banks leveraging themselves 40, 50, 60:1? Yep, result of deregulation. Oh yeah, and regulation prevents the formation of cartels and monopolies, which inevitably result in a purely unregulated market. Yes, the government can actually encourage competition.

5) Big government is good for you... in some ways, absolutely. Many people here seem to think that government is the worst evil imaginable. Simply untrue. Bad government is intolerable, this is true, but the idea of government is invaluable. Look at some of the most prosperous nations on the planet (eg. Singapore, Ireland). They often involve active government involvement in things like setting wages in a neo-Corporate environment. In fact, many of these nations destroy the US in terms of per capita GDP (nominal and PPP). Of course, these governments are usually very transparent in their operation and not nearly as corrupt. As I said, government isn't the problem, bad government is.

6) Politicians know what health care is good for you. In one very important way, this is true. They know that having healthcare is better than not having healthcare, which is really superfluous since we all have emergent healthcare. If we can reduce the amount of GDP spent on healthcare, why not at least try preventative care?

7) What choice is limited? And does he believe the antithesis? Should everyone have free choice in everything (whatever that means) but not abortion?

8) Power comes from being powerless. What does this mean exactly? Are the poor somehow in a position of power over the rich elite that currently pull the strings in Congress?

9) Education to Socialism. Anti-intellectualism is certainly nothing new, but coming from a Prof it's certainly arrogant. Reading some of his articles, I might make the alternate claim that taking his classes leads to Fascism. He's certainly quick to attack the progressive system from which he collects a paycheck. Or perhaps other professors shouldn't be allowed to express their views.

10) Race doesn't count.... how does this involve the government? If you know someone that is offended by racial slurs, I would recommend you not make one to them. How is this Obama's problem?

11) Higher education gets lower each year... I have no idea what this means. Lower what? Elevation, frequency, cost, height? Doesn't make any sense.

12) I certainly don't agree with helping bankers and then relying on them to fix a problem they created. But this is a result of politicians of both administrations. And why do we think that an unregulated market that went out of control with greed (and those CEOs that will inevitably just be hired by boards whom are populated by their friends) will solve this problem in the future.

13) Religion should be private. What's the issue here? Is he suggesting that we let religion govern public discourse and resolution? If so, which one?

14) How is liberal radical? Someone from that side of the aisle just got elected.

15) Free speech is selective speech. How so? I haven't noticed anyone telling me I can no longer say something that I could say before Obama got elected.

16) What courage is he referring to?

Face it, the guy that wrote the article you posted is nothing original. He's simply another partisan hack, and we have plenty of those to go around. He parrots others, but for being a professor, I'm disheartened by his inability to do any sort of quantitative examination of the problem (for instance, ignores 100 years of progressive and often repressive tax rates). But I suppose hiding your worn ideology in verbose articles is standard fare these days for people too busy to question their own ideas and the world around them. He certainly spent more time writing that article than actually determining if our country is on a path to "Marxist utopia."
 

StageLeft

No Lifer
Sep 29, 2000
70,150
5
0
One thing's for sure: When the gov uses terms like accountability and transparency, quick, go to the store and buy some KY because you're gonna need it. Such terms are not used without them following up on a significant request, are they?
 

sciwizam

Golden Member
Oct 22, 2004
1,953
0
0
Looks like one of the promised tax cut for small business is being postponed..

Text

A tax cut deferred

Obama's budget plan closes the deficit in part by postponing a promised tax cut well into his second term.

The focus on tax cuts was central to Obama's campaign against John McCain, and his surprising strength in polls on the question of taxes.

One of those promised cuts -- the second bullet point in his campaign economic plan -- was a pledge to "eliminate all capital gains taxes on startup and small businesses to encourage innovation and job creation."

That cut has been deferred, a Republican source notes: The elimination only begins phasing in, according to the budget overview (PDF, page 122) in 2014, well into Obama's second term.
 

BigDH01

Golden Member
Jul 8, 2005
1,630
82
91
Originally posted by: winnar111
Originally posted by: BigDH01
Originally posted by: Genx87
Originally posted by: MovingTarget
No, it will not pay for the programs that he wants to implement. However, it is a good start.

Where does it end?

Slippery slope fallacy. And a worthless one at that. Taxes for top earners in this country have been much higher in the past. If anything, tax rates for these individuals have been trending downward, especially in the last 30 years. If high tax rates for the rich = Socialism (which many uneducated people here seem to think), then surely Conservatives look at the 50s as the golden age of Socialism in the US, correct?

Why do you think John Kennedy passed the largest tax cut in history?

Yeah, cut the top bracket to 70%. Probably still above the Laffer Curve optimal (x' = 0). Although today, we are almost certainly below optimal.

So you do admit that currently raising the top bracket just a little will still leave a tax rate not at all comparable to what the US used to experience? It is your contention then that the US used to be much more Socialistic (if taxes are how we measure that) than today?
 

sciwizam

Golden Member
Oct 22, 2004
1,953
0
0
Originally posted by: Skoorb
I love how canceling"tax breaks" is not the same as raising taxes, as if a certain tax rate is written in the bible and anything less is an unnatural tax break.

Pelosi: "It's not about raising taxes." "It's about ending a tax cut."

House Speaker Nancy Pelosi on Thursday attacked House Republicans who have criticized President Obama's proposal to raise taxes on the wealthy to fund his health care plan.

If anything, Pelosi said, Obama was being generous.

"Quite frankly, I would have done it faster," she said, noting that the phaseout of top-tier tax breaks will take years to complete.

"It's not about raising taxes," Pelosi said. "It's about ending a tax cut."

Pelosi also says Democrats are not going to slow walk health reform.

"It's very clear that it is the priority of this Congress and this president as we move forward," she said. "I would say to those who criticize this investment that this is a priority, the health of our people."
 

StageLeft

No Lifer
Sep 29, 2000
70,150
5
0
Originally posted by: sciwizam
Originally posted by: Skoorb
I love how canceling"tax breaks" is not the same as raising taxes, as if a certain tax rate is written in the bible and anything less is an unnatural tax break.

Pelosi: "It's not about raising taxes." "It's about ending a tax cut."

House Speaker Nancy Pelosi on Thursday attacked House Republicans who have criticized President Obama's proposal to raise taxes on the wealthy to fund his health care plan.

If anything, Pelosi said, Obama was being generous.

"Quite frankly, I would have done it faster," she said, noting that the phaseout of top-tier tax breaks will take years to complete.

"It's not about raising taxes," Pelosi said. "It's about ending a tax cut."

Pelosi also says Democrats are not going to slow walk health reform.

"It's very clear that it is the priority of this Congress and this president as we move forward," she said. "I would say to those who criticize this investment that this is a priority, the health of our people."
Yep, transparency fail.

 

dullard

Elite Member
May 21, 2001
25,069
3,420
126
Originally posted by: sciwizam
Looks like one of the promised tax cut for small business is being postponed.
Isn't it hard to say that it has been postponed when he already passed half of it?
Individuals who invest in small businesses over the next few years will get a nice break on their capital-gains taxes. If you buy stock in a small business, hold it for at least five years, and then sell it, current tax law allows you to exclude 50% of your gains (within certain limits). The stimulus bill increases that exclusion to 75% - but only for stock issued after the bill is enacted.
And, in case you can't do math, you have to hold it for 5 years, this is year 2009, so 2009+5 = 2014. I guess I have a hard time seeing anyone investing in a startup now and having significant capital gains before that time anyways.
 

quest55720

Golden Member
Nov 3, 2004
1,339
0
0
He is also going after the rest of us with his bull crap Cap and Trade garbage. That is just a direct tax on almost every single person out there. Every day that passes just proves I made the right vote with McCain. The democrats are trying to bankrupt the country with record spending. Now they are going to try and steal with new taxes on what little money we have left in our pockets after a hard days work.
 

SirStev0

Lifer
Nov 13, 2003
10,449
6
81
Originally posted by: BigDH01
Originally posted by: CycloWizard
As Lincoln said, "You cannot make a weak man strong by making a strong man weak and you cannot make a poor man rich by making a rich man poor." I thought this piece might be enlightening for a lot of people here.

Not really. Once again, he claims that without a low income tax that the incentive to generate wealth will be destroyed. He apparently neglects to tell people that the rich in the US paid a much higher marginal rate in the past than they do now. And guess what, people still created businesses and jobs. The government is not taking all of your money, if you earn a million next year, for every dollar beyond that you earn, you still get to keep most of it. There is still an incentive for you to earn more.


The author clearly indicates that he has no idea what Marxism really is. In that way, he is no different from many people on this board that keep throwing around the term "Socialism" but always back down and ignore my request to 1) describe it and 2) detail how the United States is transforming into a Socialist nation by increasing progressive tax rates (a concept embraced by even Adam Smith). And if the author wants to maintain a veil of impartiality, he probably shouldn't write articles like this.

The America of now is one where Orwellian logic rules. Forced redistribution of wealth is fairness. Taxes are patriotic. The free market should be a regulated market. Big government is good for you. Politicians know what kind of healthcare is best for you. Choice should be limited, except when it comes to abortion. Power comes from being powerless. Progressive education is designed to promote progress toward socialism. Race doesn?t count unless a person of color tells you it counts. Higher education gets lower each year. Those who create our problems should be asked to solve them. Religion should be a private matter that does not inform public morality. Liberal is radical. Free speech is selective speech. Courage is impetuousness.

Yeah, sounds like a reasonable guy. Let's break it down...

1) Orwellian logic - Yes, surely the Bush administration was model of truth and transparency and never used propaganda and misinformation to further their goals. Every politician and political party does this, but the fact that he says this about an Obama election raises some huge red flags and lets me know of the bat that this guy is a partisan hack, nothing more.

2) Forced redistribution of wealth is fairness.... Even Adam Smith said this was fair.

The necessaries of life occasion the great expense of the poor. They find it difficult to get food, and the greater part of their little revenue is spent in getting it. The luxuries and vanities of life occasion the principal expense of the rich, and a magnificent house embellishes and sets off to the best advantage all the other luxuries and vanities which they possess. A tax upon house-rents, therefore, would in general fall heaviest upon the rich; and in this sort of inequality there would not, perhaps, be anything very unreasonable. It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.

The US has used progressive taxation in the past and in a much more punishing and progressive manner. To say that Obama is now the harbinger of redistribution is a lie and ignores the last century of US tax policy.

3) Paying your taxes is patriotic... so he believes the antithesis is true? If I quit paying my taxes would you call me a patriot? There is nothing patriotic or non-patriotic about it, it is fulfilling my civic and lawful duty.

4) The free market should have some regulations in place. You see the CDS catastrophe approaching? CDSs were used because they didn't fall under insurance regulations. You see banks leveraging themselves 40, 50, 60:1? Yep, result of deregulation. Oh yeah, and regulation prevents the formation of cartels and monopolies, which inevitably result in a purely unregulated market. Yes, the government can actually encourage competition.

5) Big government is good for you... in some ways, absolutely. Many people here seem to think that government is the worst evil imaginable. Simply untrue. Bad government is intolerable, this is true, but the idea of government is invaluable. Look at some of the most prosperous nations on the planet (eg. Singapore, Ireland). They often involve active government involvement in things like setting wages in a neo-Corporate environment. In fact, many of these nations destroy the US in terms of per capita GDP (nominal and PPP). Of course, these governments are usually very transparent in their operation and not nearly as corrupt. As I said, government isn't the problem, bad government is.

6) Politicians know what health care is good for you. In one very important way, this is true. They know that having healthcare is better than not having healthcare, which is really superfluous since we all have emergent healthcare. If we can reduce the amount of GDP spent on healthcare, why not at least try preventative care?

7) What choice is limited? And does he believe the antithesis? Should everyone have free choice in everything (whatever that means) but not abortion?

8) Power comes from being powerless. What does this mean exactly? Are the poor somehow in a position of power over the rich elite that currently pull the strings in Congress?

9) Education to Socialism. Anti-intellectualism is certainly nothing new, but coming from a Prof it's certainly arrogant. Reading some of his articles, I might make the alternate claim that taking his classes leads to Fascism. He's certainly quick to attack the progressive system from which he collects a paycheck. Or perhaps other professors shouldn't be allowed to express their views.

10) Race doesn't count.... how does this involve the government? If you know someone that is offended by racial slurs, I would recommend you not make one to them. How is this Obama's problem?

11) Higher education gets lower each year... I have no idea what this means. Lower what? Elevation, frequency, cost, height? Doesn't make any sense.

12) I certainly don't agree with helping bankers and then relying on them to fix a problem they created. But this is a result of politicians of both administrations. And why do we think that an unregulated market that went out of control with greed (and those CEOs that will inevitably just be hired by boards whom are populated by their friends) will solve this problem in the future.

13) Religion should be private. What's the issue here? Is he suggesting that we let religion govern public discourse and resolution? If so, which one?

14) How is liberal radical? Someone from that side of the aisle just got elected.

15) Free speech is selective speech. How so? I haven't noticed anyone telling me I can no longer say something that I could say before Obama got elected.

16) What courage is he referring to?

Face it, the guy that wrote the article you posted is nothing original. He's simply another partisan hack, and we have plenty of those to go around. He parrots others, but for being a professor, I'm disheartened by his inability to do any sort of quantitative examination of the problem (for instance, ignores 100 years of progressive and often repressive tax rates). But I suppose hiding your worn ideology in verbose articles is standard fare these days for people too busy to question their own ideas and the world around them. He certainly spent more time writing that article than actually determining if our country is on a path to "Marxist utopia."

Great Post and I am only commenting on it because no one in here is actually going to read it or take the time to address any of the points you just made.

I imagine someone will probably take a line or one point and comment on it, somehow thinking that it therefore invalidates your entire post. I just wanted to jump in here before they did.
 

winnar111

Banned
Mar 10, 2008
2,847
0
0
Originally posted by: BigDH01
Originally posted by: winnar111
Originally posted by: BigDH01

Slippery slope fallacy. And a worthless one at that. Taxes for top earners in this country have been much higher in the past. If anything, tax rates for these individuals have been trending downward, especially in the last 30 years. If high tax rates for the rich = Socialism (which many uneducated people here seem to think), then surely Conservatives look at the 50s as the golden age of Socialism in the US, correct?

Why do you think John Kennedy passed the largest tax cut in history?

Yeah, cut the top bracket to 70%. Probably still above the Laffer Curve optimal (x' = 0). Although today, we are almost certainly below optimal.

So you do admit that currently raising the top bracket just a little will still leave a tax rate not at all comparable to what the US used to experience? It is your contention then that the US used to be much more Socialistic (if taxes are how we measure that) than today?

The government collected less revenues as a % of GDP in the 1960s with that tax rate than they did in the 2000s with Bush's tax rates. There were millionaires paying $0 in taxes in those years.

The difference is the Medicare industry complex evolved from $.1 billion to $400 billion over those years.
 

Zebo

Elite Member
Jul 29, 2001
39,398
19
81
Originally posted by: dullard
Originally posted by: sciwizam
Looks like one of the promised tax cut for small business is being postponed.
Isn't it hard to say that it has been postponed when he already passed half of it?
Individuals who invest in small businesses over the next few years will get a nice break on their capital-gains taxes. If you buy stock in a small business, hold it for at least five years, and then sell it, current tax law allows you to exclude 50% of your gains (within certain limits). The stimulus bill increases that exclusion to 75% - but only for stock issued after the bill is enacted.
And, in case you can't do math, you have to hold it for 5 years, this is year 2009, so 2009+5 = 2014. I guess I have a hard time seeing anyone investing in a startup now and having significant capital gains before that time anyways.

My point. Obama is BlackBush. Tax workers not business owners and the rich who don't derive their income from wages (if they are smart).

Obama is adding to the already biggest loophole/advantage in the tax code - the tax-free compounding of income and eventual, a relatively low tax rate upon withdrawl, SS and Medicare tax free rate called capital gains, when asset is sold/realized - will only increase the chasm.

Increasing marginal income tax rate is window dressing for the leftists who voted for him.
 

CPA

Elite Member
Nov 19, 2001
30,322
4
0
It also looks like Obama is bringing back the marriage penalty. New rates for married couples making $250K and new rates for singles making $200K. Might was well stay unmarried and get a nice tax break.
 

Xavier434

Lifer
Oct 14, 2002
10,377
1
0
Originally posted by: CPA
It also looks like Obama is bringing back the marriage penalty. New rates for married couples making $250K and new rates for singles making $200K. Might was well stay unmarried and get a nice tax break.

Back? It never left. It just changed. I have remained unmarried because I will be losing thousands in taxes if I got married. I run my taxes along with my domestic partner's taxes every year both single and as if we are married to compare the results. Every year is the same thing. Thousands of dollars lost if we were to get married.
 

CPA

Elite Member
Nov 19, 2001
30,322
4
0
Originally posted by: Xavier434
Originally posted by: CPA
It also looks like Obama is bringing back the marriage penalty. New rates for married couples making $250K and new rates for singles making $200K. Might was well stay unmarried and get a nice tax break.

Back? It never left. It just changed. I have remained unmarried because I will be losing thousands in taxes if I got married. I run my taxes along with my domestic partner's taxes every year both single and as if we are married to compare the results. Every year is the same thing. Thousands of dollars lost if we were to get married.

point taken. I'm looking it at if from the perspective of a married couple who can't take advantage of this because if I filed Married filing Single, I get dinged with forfeited deductions. I was also surprised at the narrow difference of the two wage ceilings. If it was $250K married, $150K Single, I would have not had blinked an eye.
 

Genx87

Lifer
Apr 8, 2002
41,095
513
126
Originally posted by: CPA
It also looks like Obama is bringing back the marriage penalty. New rates for married couples making $250K and new rates for singles making $200K. Might was well stay unmarried and get a nice tax break.

<tinfoil hat>

voting demographics show a higher % of singles vote democratic, a higher % of married vote republican
</tinfoil hate>
 

alchemize

Lifer
Mar 24, 2000
11,489
0
0
Originally posted by: CPA
It also looks like Obama is bringing back the marriage penalty. New rates for married couples making $250K and new rates for singles making $200K. Might was well stay unmarried and get a nice tax break.
I saw that. Under his plan, it would make fantastic sense for me to get divorced. My wife has no income and 4 kids and gets all the free moneys that poor people deserve. I get to lower my taxes. Win win!
 

JS80

Lifer
Oct 24, 2005
26,271
7
81
Originally posted by: alchemize
Originally posted by: CPA
It also looks like Obama is bringing back the marriage penalty. New rates for married couples making $250K and new rates for singles making $200K. Might was well stay unmarried and get a nice tax break.
I saw that. Under his plan, it would make fantastic sense for me to get divorced. My wife has no income and 4 kids and gets all the free moneys that poor people deserve. I get to lower my taxes. Win win!

Sadly enough, if my wife gets pregnant this year we will seriously consider the fake divorce strategy.
 

Xavier434

Lifer
Oct 14, 2002
10,377
1
0
Domestic Partnership + vows + "wedding" ceremony + no papers

That is the answer. All the perks. None of the problems...unless you are Christian.

You also need to legally cover yourself when it comes to things that are assumed if you are married like getting a will and such, but that really isnt a big deal.