The fiscal cliff

[diggitydot]

1. "Entitlement" is a Fox News-borne phrasing that conveniently applies to humans but not to corporations, who receive "credits" and "bailouts".
2. Who wants to fall off the fiscal cliff? It's nothing more than a political pissing contest by a bunch of people who really have no interest in properly doing their jobs. Congress should see pay cuts, pension loss and healthcare impacts that everyone else has.
3. You made money? Congratulations! Pay taxes on it. Hiding it in investments and off-shore banks doesn't make it any less yours. CEO packages are set up so that they get a "pittance" of several million in salary and the rest is in equity, stock and options, totaling well over twice what the actual salary is. Yes, it is risk-based but by and large you know what you're getting - however they are only taxed on the salary. Tax the full compensation.
4. "Job creators", my ass. Leave the tax credits in place and those people and corporations will keep it. Trickle down economics are bullshit and fail.

We need far fewer politicians and far more economists working on this.

Word to every last bit.

[bobk]

I am just getting really tired of people conflating raising taxes with raising revenue.

Or, conversely, that cutting taxes will starve the government of revenue.

[PrincessFiona]

The Democrats plan will cost us quite a bit. Dh was crying over $1000/mo. Maybe he got it wrong...

[PrincessFiona]

The thing is.... those multi-millionaires will still have their offshore accounts, investment income and loopholes. My guess is they won't pay more. We will...and dh is working mire and harder for less pay. I feel stressed and unhappy. Im double-checking dh's estimate.

[spotty_dog]

I am just getting really tired of people conflating raising taxes with raising revenue.

Hm, could you explain? I think it seems fairly reasonable to intermix the two in any given conversation, given that tax receipts (corporate, personal income, payroll, and excise taxes) account for some 94% of federal revenues? http://www.taxpolicycenter.org/brief...rs/revenue.cfm

[spotty_dog]

The Democrats plan will cost us quite a bit. Dh was crying over $1000/mo. Maybe he got it wrong...

As compared with the Republican plan, or the fiscal cliff, or this year's taxes?

If you look at bobk's link, there's a link on that page to the calculator they used to create their graphic. There, you can input your own family's figures and compare between: 2012 tax law, 2013 tax law (the fiscal cliff), the Democratic plan, and the Republican plan. I'm going to go put in our 2011 figures and see what it would mean for us...

[bobk]

Hm, could you explain? I think it seems fairly reasonable to intermix the two in any given conversation, given that tax receipts (corporate, personal income, payroll, and excise taxes) account for some 94% of federal revenues? http://www.taxpolicycenter.org/brief...rs/revenue.cfm

I believe she's just saying that raising taxes does not guarantee more money for the government. Raising taxes creates disincentives to earn more and make investments, which put other people to work who pay taxes. The net effect is that the government brings in less revenue (these losses exceed any gains made by the tax increase).

[GrayMatterWife]

Hm, could you explain? I think it seems fairly reasonable to intermix the two in any given conversation, given that tax receipts (corporate, personal income, payroll, and excise taxes) account for some 94% of federal revenues? http://www.taxpolicycenter.org/brief...rs/revenue.cfm

Shorthand: the more your pay in taxes, the less you have to invest and use for growth. Slower investment returns and growth, lower earnings and profits. Lower earnings and profits, lower tax revenue. We will never tax tax ourselves to prosperity. No society ever has. Screaming that the rich should pay more only means, in real dollars, that the government will have less revenue. More control, but less revenue. Want more revenue to the government? Lower taxes, create incentives to invest and grow, and everyone will have better returns, including the government.

People are going to be pissed in the end. Most people's retirement, in one way or another, rests on American capitalism via 401Ks, etc. What happens when corporations are taxed more? Nothing good for your retirement. But, of course, that is a fantastic way to grow government control and dependency.

[GrayMatterWife]

I believe she's just saying that raising taxes does not guarantee more money for the government. Raising taxes creates disincentives to earn more and make investments, which put other people to work who pay taxes. The net effect is that the government brings in less revenue (these losses exceed any gains made by the tax increase).

Better stated.

[spotty_dog]

I believe she's just saying that raising taxes does not guarantee more money for the government. Raising taxes creates disincentives to earn more and make investments, which put other people to work who pay taxes. The net effect is that the government brings in less revenue (these losses exceed any gains made by the tax increase).

Yes, that makes sense that the two can't be interchanged perfectly. However, I don't buy that increased tax rates will always have the effect of a net loss in revenues.

[GrayMatterWife]

I believe economics, math and human nature. And history.

[GrayMatterWife]

The thing is.... those multi-millionaires will still have their offshore accounts, investment income and loopholes. My guess is they won't pay more. We will...and dh is working mire and harder for less pay. I feel stressed and unhappy. Im double-checking dh's estimate.

Of course they won't pay more. They are rich for a reason. They understand economics and have the resources to avoid (legally and otherwise) paying taxes. Honestly, this is all a little silly. Obama wants a bigger govenment and a more dependent society in order to redistribute resources, and he will attempt to accomplish that by trying to create a war in the House by dividing Republicans. This is just divisive, nasty, Chicago-style politics framed around class warfare. He is a small person with small politics and small ideas, with a huge goal. He has no interest in solving the problem--he wants to use the crisis to increase his power.

[bobk]

Yes, that makes sense that the two can't be interchanged perfectly. However, I don't buy that increased tax rates will always have the effect of a net loss in revenues.

You're right and I didn't mean to imply that was always the case. The problem is that there's no clear way to quantify the effect of a change in tax policy. There are so many variables involved that we can only make educated guesses. If it were an exact science, there would be very little debate about it. My bias is that with everything else being equal, lower taxes are preferable. I share GMW's frustration that liberals almost always view tax increases as more money for government, while a tax cut means less.

[spotty_dog]

I believe economics, math and human nature. And history.

I'd love some examples of tax increases universally leading to revenue decreases -- or the converse. I'm finding the opposite so far. For example, in 1942 tax revenues totalled a bit over $14 billion. The Revenue Act of 1942 raised taxes and in 1943 and 1944 revenues skyrocketed to $24B and then up to $43B. In 1993 receipts totalled $842B. The Omnibus Budget Reconciliation Act of 1993 raised taxes and in 1994 and 1995 receipts were up to $923B then $1 trillion.

Oh, here, instead of me picking over historical tables from the Office of Management and Budget, here's a report from the Department of Treasury about historic tax bills and their revenue effects: http://www.treasury.gov/resource-cen...ents/ota81.pdf

But really, as the article said that I posted earlier, asking whether we should raise or lower taxes, enact austerity or provide stimulus, is like asking whether a car should turn right or left. It depends on where the car is and where it's going. But it seems pretty solidly supported to state that WHEN the economy is in a recession, THEN we should provide stimulus and cut taxes. However, when tax rates on the wealthiest individuals are already pretty darned low...the top tax bracket used to be 70%!...then I find it very hard to swallow a need to cut them further.

[Sheherezade]

Once again, this thread has had me looking for a "like" button on many post. Carry on, all.