Raising the debt ceiling

[timm]

Many very rich are in your number 2 these days. Be good to get statistics.

Thats a good one...You are right - statistics would be a good thing... unfortunately, statistics are only as good as the person putting them together and the slant that they want to put on them. My question was related to people's viewpoints - not necessarily what is happening. I am not sure that most are in number 2.... I am guessing it is more like the millionaire pays 150K in taxes as opposed to 280K because of possible write offs. Is that his fair share yet? I don't know how to answer that really.... Now if someone does have statistics they'd like to share.... All I know is that when I go to my CPA - I can't write off many losses ... why? because I 'make too much'.... Now, do I make a LOT? Well, I don't think so - but statistically, my family income is probably in the top 3% -- and that is about enough so that I will probably be able to retire at age 65... So from my experience - the more you make - the fewer tax breaks there are.

Maybe as you go up the ladder, own businesses - there are more tax 'breaks'. But, then all I hear in my state is that the business tax is too high which is why a lot of businesses leave....

 

[tsv_1]

Thats a good one...You are right - statistics would be a good thing... unfortunately, statistics are only as good as the person putting them together and the slant that they want to put on them. My question was related to people's viewpoints - not necessarily what is happening. I am not sure that most are in number 2.... I am guessing it is more like the millionaire pays 150K in taxes as opposed to 280K because of possible write offs. Is that his fair share yet? I don't know how to answer that really.... Now if someone does have statistics they'd like to share.... All I know is that when I go to my CPA - I can't write off many losses ... why? because I 'make too much'.... Now, do I make a LOT? Well, I don't think so - but statistically, my family income is probably in the top 3% -- and that is about enough so that I will probably be able to retire at age 65... So from my experience - the more you make - the fewer tax breaks there are.

Maybe as you go up the ladder, own businesses - there are more tax 'breaks'. But, then all I hear in my state is that the business tax is too high which is why a lot of businesses leave....

Some of it depends on how (and where) you keep your holdings. Many of the very wealthy have already retired and pay no payroll tax and minimal income tax (shelters etc). Also, congrats on being in the top 3%... though still technically in the 99% with the rest of us roust-abouts

 

[timm]

Some of it depends on how (and where) you keep your holdings. Many of the very wealthy have already retired and pay no payroll tax and minimal income tax (shelters etc). Also, congrats on being in the top 3%... though still technically in the 99% with the rest of us roust-abouts

put it this way .... I don't have CLX's !!! ...that was a joke not meant to be at anyone's expense ...or to start class warfare here on our kum-baya site!!

 

[tsv_1]

put it this way .... I don't have CLX's !!! ...that was a joke not meant to be at anyone's expense ...or to start class warfare here on our kum-baya site!!

the joke went completely over my head... I read your comments as just stating fact. No offense taken... 'cause I missed the joke that wasn't intended to offend... or something like that.

 

[Gordon Gray]

Hi Timm,

Regarding your second to last post, here's some info regarding Major Corporations, profits, and taxes. Or should I say no taxes.

Goggle "corporations no tax paid".

Profits as follows. List includes DuPont ($2.1), Boeing ($9.7), Verizon ($32.5) , Honeywell International ($4.9), and General Electric ($10.5) to name a few. And the apparent "winner" is Wells Fargo at ($49.4)

The numbers listed are in billions, if I did my math correctly, over the last three years.

GG

PS: For the record, numbers came from the "thinkprogress.org" website. Assuming these numbers are accurate, maybe there's some good reason for this but, on the surface, it does boggle the mind.

 

[eknuds01]

Regarding taxation... I would just like to ask a couple of questions - and maybe some can reply... I always here this 'fair share' concept... that those that earn more should pay more. So it boils down to math and semantics.... When people say the rich are not paying their fair share ... what do they mean exactly - read the story problems below...and as a precursor - I am no expert with taxes....

Example 1:
Guy makes one million - pays 280,000 in taxes (lets just call it 28% tax bracket)
Guy makes one hundred K -- pays 28,000 in taxes (28% tax bracket for simplicity)

Did the millionaire pay his 'fair share' above?

OR
Example 2:
Guy makes one million - pays 15,000 in taxes because he has so many write offs.
Guy makes 100k - pays 28,000 because he has no write offs.

Is this what the 'fair sharers' are saying ? or do they truly believe that if a guy makes 1 mill - and has 720K in the bank at the end of the day -- he should really sign up for more - because he can afford it....

I'm just curious... This is typical politics quite frankly - Some people deal in percentages... some deal in real dollars... and then the numbers get twisted based on whatever side you seem to favor. I just really don't know the answer when people make the arguement that rich people don't pay their fair share... Is it example 1 or example 2?

Timm -

Good question and I've always thought it was the percentage that angered many. We've all heard the story about Buffet being 'upset' over his tax rate being lower than this secretary's. However, perhaps it's not that simple because, and this is hardly a shock, our tax code is enormously complex. I know my bracket is 25 or 28%, but my effective tax rate is much lower than that. No, I am not rich. No, I don't hide money in banks located on islands far away (why should my money go on vacation!). No, I don't live off of interest or capital gains from stock/bond funds.

I am no tax expert nor am I well versed in the in all of the variables that go into making an economy chug along successfully. I don't think tax rates (raising or lowering), in and of themselves, are a guarantee that the economy will automatically improve. You can probably find periods where taxes were raised, and everything worked out fine and also find periods where taxes were cut and things were OK.

I've always liked the idea of a national sales tax (consumption tax) but, again, I am no expert on the matter. I think that making the tax code much simpler and more transparent would make things a lot easier. One would think that a number of loopholes would be closed down. Or maybe it isn't that simple.

 

[Len44]

Well folks, the flat tax I think I can pretty well live with. However, the "consumption tax" is another matter. Let's say a fellow makes a cool million this year. Now, let's say his buddy makes 100k. Now, both buy CLXs. The proportion of their respective incomes is noticeably different. The gent with the million dollar income will hardly feel any pain in the wallet, however, his buddy will spend about 20 percent of his income on the speakers.

Likewise, it is utterly ridiculous for SS payroll taxes to be capped at $106,900. That's just crazy! Let's have NO cap, and include bonuses and stock options, etc. in the equation. Heck, might even make a dent in the so-called SS "crises."

 

[eknuds01]

Well folks, the flat tax I think I can pretty well live with. However, the "consumption tax" is another matter. Let's say a fellow makes a cool million this year. Now, let's say his buddy makes 100k. Now, both buy CLXs. The proportion of their respective incomes is noticeably different. The gent with the million dollar income will hardly feel any pain in the wallet, however, his buddy will spend about 20 percent of his income on the speakers.

Likewise, it is utterly ridiculous for SS payroll taxes to be capped at $106,900. That's just crazy! Let's have NO cap, and include bonuses and stock options, etc. in the equation. Heck, might even make a dent in the so-called SS "crises."

You might be over simplifying the consumption tax. Let me re-iterate (for the 78th time) that I have no accounting degree, tax law background, nor am I an economist, but your example may not capture the entire story behind the motivation of the national sales tax. From what I've read, there are a number of other factors to consider - namely no payroll or income taxes (I am referring, at least in part, to something like the Fair Tax plan) nor are there taxes on capital gains, estates, etc.

There are also supposed to be some special rebates that are kicked for people based on how much income is brought in. Other metrics such as life-time income (instead of annual) are supposed to espouse the benefits of the fair tax approach.

Based on the example you've written down - yes, if that alone is how the national sales tax is to be administered it's probably very regressive. However, it seems that there are some additional rules and provisions that make something like the fair tax about as progressive as our current system but now you don't have the myriad of issues such associated with the status quo.

 

[tsv_1]

You might be overly simplifying the consumption tax. Let me re-iterate (for 78th time I have no accounting degree, tax law background, nor am I an economist) but your example may not capture the entire story behind the motivation of the national sales tax. From what I've read, there are a number of other factors to consider - namely no payroll or income taxes (I am referring, at least in part, to something like the Fair Tax plan) nor are there taxes on capital gains, estates, etc.

There's also supposed to be some special rebates that are kicked for people based on how much income is brought in. Other metrics such as life-time income (instead of annual) are supposed to espouse the benefits of the fair tax approach.

Based on the example you've written down - yes, if that, alone, is how the national sales tax is to be administered it's probably very regressive. However, it seems that there are some additional rules and provisions that make something like the fair tax about as progressive as our current system but now you don't have the myriad of issues such associated with status quo.

There are other "hidden" benefits to a Fair-Tax plan as well... it encourages re-use of products (only new goods are taxed) so it's potentially greener and it would also pull in revenue from the wealthy who, under the current tax code, pay little or nothing - but under a consumption plan would pay the embedded tax every time they buy the mistress a new diamond or that new Ferrari.

To me though, the real kicker would be the influx of business and jobs here in the states - a massive economic boost... why? No corporate taxes. Businesses could setup shop anywhere they wish (probably guided more by local real-estate costs and talent pools) and not pay a dime of federal tax. Also what would you do if you suddenly brought home 90% to 100% of your paycheck versus 50% to 60%? You would BUY MORE STUFF - or at least most people would.

While I'm not a fan of the sponsers (especially that dreadful Michael Reagan) - I am absolutely intrgued by the plan itself. The simplicity, the "fairness", the magnetic attraction of businesses back to this country. Here's another fun-fact - it would replace the current system (IRS) system which costs $265 billion a year in compliance costs and still comes up $350 billion a year short of what is owed. Tell me the current system isn't horribly broken.

For it to be successful though it would have to be all or nothing. No hybrid plan of income tax and consumption tax... that would be the worst possible scenario (IMO).

Some interesting reading here IMO: http://www.fairtax.org/site/PageServer?pagename=about_faq_answers#45

 

[timm]

wow - some really great stuff here guys... I never thought of the sales tax that way - but, never heard a lot of the different angles of it....

Started thinking about the whole class warfare thing - and was that brought about by Marx?? if I recall? (now my name is on a list somewhere for being a communist!!)-- I always find it ironic when someone else has something - instead of people trying to get it - they focus on taking it away...so some type of equality or other can take place... which is why I cringe at the entire tax debate... It is usually about taking from others so things are better for the rest....as opposed to getting the rest up to the top of the hill... and to me, that seems like class warfare at its finest.... Now if you take that concept and look at our two political parties all I can do is shake my head because I'm not sure either of them have it right... Seems like people on this forum have a better handle on it!! One other thing ..

Regardless of the tax laws - I think it makes sense to invest in CLX's... Put your money into an investment that you enjoy - You don't have to worry about taxation on its value ...don't have to worry about a world collapse...and you better buy now before someone institutes some new crazy tax law!!! One other benefit -- you are decreasing your tax bracket because there is no investment income to report!! so the benefits are obvious... How can I sell this to the wife???

I don't know if it is Karma or what - but I ran across this quote today...

• "Until they become conscious they will never rebel, and until after they have rebelled they cannot become conscious."
- George Orwell, 1984, Book 1, Chapter 7

 

[Kevin]

I've been enjoying keeping up with all the posts, but work has been busy (which is a good thing) so I haven't had a chance to respond. A poll that simply asks if the rich should pay their "fair share" is greatly misleading, as I think someone has basically already pointed out. I would answer yes to that, and yet I believe they are already paying more than their fair share myself. I would think everyone would believe they should pay their fair share, the question is is "what is fair share". Timm- You're correct about your assertion that people try to take away as opposed to gaining themselves. I read a poll just a couple of weeks ago that asked college students something like this. Would you rather make a $100,000 a year and have your friends and neighbors make $150,000 or would you rather make $75,000 and have your friends and neighbors make $50,000. The majority answered that they would rather make the lesser amount ($75,000), but more in relation to their close peers. We really have become a keeping up with the Joneses society. I'm not anywhere close to the top wage earners, but as long as they made their money legally, I don't begrudge either their hard work, luck, and/or good fortune. If there are moral issues involved with how the money was made and that upsets people, then work to change the law to make those practices illegal. I'm all for that.

I find the history of the founding of our nation to be quite interesting, and though a bit late, fits in with our recent Thanksgiving holiday. Governor Bradford of the Plymouth colony, orginally set up a communal living system where all the land and products were equally shared, everyone receiving their "fair share". He soon found the colony faltering due to more and more lazy individuals not sharing in the work load and yet still receiving the fruits of the fewer laborers who were. It started destroying the will for anyone to work, knowing that others were getting a free ride off of their own blood and sweat. So Bradford incorporated a system of "to each his own", and the people of the colony either had to work or starve. The choice being an easy one for most, the colony once again prospered and grew. And so they sat down with their Indian brothers and had the great feast. Almost 400 years ago, some people learned a lesson that we still can't seem to grasp.

I need to leave the office now to start my weekend and enjoy the humble fruits from my own labor!

 

[Len44]

We really have become a keeping up with the Joneses society. I'm not anywhere close to the top wage earners, but as long as they made their money legally, I don't begrudge either their hard work, luck, and/or good fortune. If there are moral issues involved with how the money was made and that upsets people, then work to change the law to make those practices illegal. I'm all for that.

Neither do I (begrudge).

However, if there is anyone in America that thinks what the Wall Street Dudes (WSDs) did to this country was legal, I am astonished. Not only was it illegal, it was immoral and a betrayal of their countrymen. Some might even consider them financial terrorists. I know I do!

Example: Just today it was disclosed that several Big Banks, like Bank of America, Citibank, Wells Fargo, and others illegally foreclosed on our brave servicemen and servicewomen. Shameful! These guys were bailed by the taxpayers, then went right back to mega $$$$$ bonuses to the idiots that caused the financial rises in the first place. I certainly DO understand the rage of the OWS folks.

Man, when I get to be in charge, there are going to be some BIG TIME changes made, starting with those WSDs!

 

[twich54]

Man, when I get to be in charge, there are going to be some BIG TIME changes made !

Len, just don't mess with my second amendment rights !!

 

[Len44]

Len, just don't mess with my second amendment rights !!

No problem.....unless of course we are talking about Uzis / automatic weapons for deer hunting...

Interestingly, here is another area where leaving regulation to the states has resulted in some rather interesting situations.
One example:
"Firearm owners are subject to the firearm laws of the state they are in, and not exclusively their state of residence. Reciprocity between states exists in certain situations, such as with regard to concealed carry permits. These are recognized on a state-by-state basis. For example, Idaho recognizes an Oregon permit, but Oregon does not recognize an Idaho permit. Florida issues a license to carry both concealed weapons and firearms, but others license only the concealed carry of firearms. Some states do not recognize out-of-state permits to carry a firearm at all, so it is important to understand the laws of each state when traveling with a handgun."

And then there is this hysterical (and quite laughable) quote found at Yahoo, prior to the 2008 election:

"...rest assured if Obama is elected firearm ownership will never be the same!"

I am unaware of any significant change to the 2nd Amendment as a result of Barrack Obama's election as President...

 

[Gordon Gray]

There hasn't been. Pure hype and fear propagated by the NRA I suspect.

Although, the bullet manufacturers certainly made out big time.

GG

 

[timm]

Maybe he figured he would leave guns alone so he could tax them? I know ......way out of line there.

 

[Gordon Gray]

Well he certainly sustained employment within the ammunition manufacturer sector of the economy.

 

[twich54]

Well he certainly sustained employment within the ammunition manufacturer sector of the economy.

as well as the gun mfg, for post Obama election of '08 saw the greatest surge in weapons purchasing in recent memory.

Now lets get something straight___________ don't think that for one minute our president wouldn't make changes if he could and with that being said re-election is less than a year away so now is not the time for HIM (he's got Eric Holder and buch of other closet bums to do it for him)to pick a fight with pro gun owners (yeah guess what, lots of them are Dems as well !).

Once he gets re-elected to his final term all bets are off and given the state from which came from (Il.) I wouldn't trust him with my second amendment rights as far as I could throw him !

Myself a life long NRA member acknowledge full well some of the ridiculus stances they have taken too, but they remain my strongest supporter of my rights.

 

[Len44]

as well as the gun mfg, for post Obama election of '08 saw the greatest surge in weapons purchasing in recent memory.

Now lets get something straight___________ don't think that for one minute our president wouldn't make changes if he could and with that being said re-election is less than a year away so now is not the time for HIM (he's got Eric Holder and buch of other closet bums to do it for him)to pick a fight with pro gun owners (yeah guess what, lots of them are Dems as well !).

Once he gets re-elected to his final term all bets are off and given the state from which came from (Il.) I wouldn't trust him with my second amendment rights as far as I could throw him !

Myself a life long NRA member acknowledge full well some of the ridiculus stances they have taken too, but they remain my strongest supporter of my rights.

Oh come on, Dave. You guys are too frickin' suspicious. Actually, contrary to what some seem to believe, President Obama is NOT the anti-Christ.

 

[twich54]

Len, you're right........ I am suspicious ! if no other reason while in the state Gov't of Illinois (arguably the most anti gun state in the union) he voted anti-gun whenever he had a chance, he actually endorsed a total ban on the mfg, sale and possession of hand guns and like most non gun owners he too is clueless. i doubt he would know a forcing cone from a snow cone !