Obama's Speech: Dysfunctional Three Ring Circus

[WhoWee]

I found a transcript - with a few comments added (in green) by the poster.
http://www.maggiesnotebook.com/2011/07/obama-speech-transcript-7-25-11/

I noted this speech differed greatly from the one then-Senator Obama made when President Bush wanted to raise the limit.

The one component that bothers me about this speech is the description of the effect on interest rates - blaming the Republicans for a downgrading of the US - when the fact is he has presided over Quantitative Easing - the printing of money AND coupled with downward pressure on interest rates.

WHEN (not if) interest rates increase - President Obama appears ready to blame the Republicans. Please label IMO.

 

[Ryan_m_b]

Potentially dangerous question but what is the rational behind tax breaks for the rich in the US? I can't figure it out at all

 

[WhoWee]

Potentially dangerous question but what is the rational behind tax breaks for the rich in the US? I can't figure it out at all

That's a valid question. Please consider this - people who don't pay any federal income taxes (nearly 50% of "taxpayers") don't need tax breaks - although they may qualify for a redistribution of tax revenues collected from others.

As for the 50% who do pay federal income taxes - they are the only ones who really need special consideration of deductions - things like depreciation schedules. When President Obama talks about the corporate jet owners enjoying tax breaks - he's talking about the number of years the cost of the asset is accounted for - basically 5 years or 7 years - it's a very minor detail.

 

[Willowz]

Republicans new tactic.

Blame it on Obama!

 

[Willowz]

http://www.bloomberg.com/news/2011-07-26/republican-leaders-voted-for-drivers-of-u-s-debt-they-now-blame-on-obama.html"

“In Washington, more spending and more debt is business as usual,” the Republican leader from Ohio said in a televised address yesterday amid debate over the U.S. debt. “I’ve got news for Washington - those days are over.”
Yet the speaker, House Majority Leader Eric Cantor, House Budget Chairman Paul Ryan and Senate Minority Leader Mitch McConnell all voted for major drivers of the nation’s debt during the past decade: Wars in Afghanistan and Iraq, the 2001 and 2003 Bush tax cuts and Medicare prescription drug benefits. They also voted for the Troubled Asset Relief Program, or TARP, that rescued financial institutions and the auto industry.

[...]

“Blaming Bush for the structural deficits we’ve known would come since the early 1990s is beyond irresponsible.”

 

[Ryan_m_b]

That's a valid question. Please consider this - people who don't pay any federal income taxes (nearly 50% of "taxpayers") don't need tax breaks - although they may qualify for a redistribution of tax revenues collected from others.

Why don't 50% of taxpayers pay federal income tax?

As for the 50% who do pay federal income taxes - they are the only ones who really need special consideration of deductions - things like depreciation schedules. When President Obama talks about the corporate jet owners enjoying tax breaks - he's talking about the number of years the cost of the asset is accounted for - basically 5 years or 7 years - it's a very minor detail.

Complicated subject so what taxes is Obama proposing that Republicans are objecting to?

 

[russ_watters]

Potentially dangerous question but what is the rational behind tax breaks for the rich in the US? I can't figure it out at all

What tax breaks for the rich are you referring to? You're aware that everyone gets tax breaks, right? And as a percentage of an individual's taxes paid, most go to the poor and middle, not the rich.(if you were referring to deductions)

Why don't 50% of taxpayers pay federal income tax?

Tax breaks and direct payments from the government (welfare, food stamps, etc).

 

[Ryan_m_b]

What tax breaks for the rich are you referring to?

I probably worded that completely wrong. I don't know a lot about the issue but constantly hear that richer Americans and corporations often end up paying less tax than those poorer than themselves.

 

[drankin]

I probably worded that completely wrong. I don't know a lot about the issue but constantly hear that richer Americans and corporations often end up paying less tax than those poorer than themselves.

Take the media hype with a grain of salt. Less wealthy pay less taxes. As you descend the income ladder the money starts going the other way into the pockets of those who don't work.

 

[Fredrik]

Potentially dangerous question but what is the rational behind tax breaks for the rich in the US? I can't figure it out at all

They believe that it will create jobs, and in general make America a better place to live in, except of course for losers who deserve to suffer anyway, just because they're losers.

The republicans have even stopped using words like "rich" in their speeches. They are now calling rich people "job creators". Seriously.

 

[russ_watters]

I probably worded that completely wrong. I don't know a lot about the issue but constantly hear that richer Americans and corporations often end up paying less tax than those poorer than themselves.

I figured, based on the wording. The left has been pretty successful selling some lies about that. For example, you may have heard about Bush's, "tax cuts for the rich" and not even realized his tax cuts were for everyone and as a percentage of income or taxes paid, actually favored the poor.

 

[Vanadium 50]

II don't know a lot about the issue but constantly hear that richer Americans and corporations often end up paying less tax than those poorer than themselves.

It is certainly possible for a millionaire to have a bad year, and have no income - and therefore pay no income tax.

The federal income tax is very progressive, I posted the breakdown in the past. The top 1% in income pays more than the bottom 95%. One consequence of this is that any income tax cut will predominantly benefit "the rich", as the poorest half wasn't paying it to begin with. It;s already cut as far as it will go for them.

 

[daveb]

I probably worded that completely wrong. I don't know a lot about the issue but constantly hear that richer Americans and corporations often end up paying less tax than those poorer than themselves.

It's not that they necessarily pay less, it's that due to certain tax breaks that can be capitalized upon only be the wealthy, some pay at a lesser rate than those who make less. The real famous instance is when http://www.washingtonpost.com/wp-dyn/content/article/2007/06/27/AR2007062700097.html" payed a tax rate of 17.7% on his taxable income as opposed to his secretary who was taxed about 30%. This is what people who want to tax the rich think of.

 

[russ_watters]

Note that that Buffets stat is based primarily on social security, which is capped for the rich and the poor get back more than the rich do percentagewise. It makes a feature that is progressive look regressive.

 

[drankin]

I just have to laugh at the political diversion. Rich people not paying enough taxes is not the problem. Sure gets us poorer folk all riled up though. Irks our sense of justice. But, that isn't the countries problem! We spend too damn much. Squeeze more tax money out of everyone isn't going to fix the problem.

 

[dlgoff]

Unfortunately.

You know what I do when I hear this crap? Head for the fridge for another beer.

I had a slight hangover this morning.

I think I'm going to block the Fox News channel as it's costing me plenty to finance my beer drinking. Don't they ever quite complaining /bashing? I want the news not their BS.

 

[Ryan_m_b]

Cheers for clearing that up someone everyone

 

[Astronuc]

Start from the bottom and cut.
http://www.federalbudget.com/

It is not enough to reduce the deficit. The deficit must be eliminated, and the debt reduced.


This doesn't help either - http://www.census.gov/indicator/www/ustrade.html

 

[BobG]

Potentially dangerous question but what is the rational behind tax breaks for the rich in the US? I can't figure it out at all

The rationale behind tax breaks is to encourage money to be invested into something that benefits the nation. For example, you want cleaner energy, so give tax breaks to those that invest in clean energy technology. Or you give tax breaks for sending yourself or your kids through college, since a college education should increase the quality of the nation's workforce.

In practice, Congressmen sell tax breaks for votes. They vote in tax breaks that will help the industries in their local area, which raises employment, makes the area more prosperous, etc. So if you're a Congressman from a district that has coal mines, you try to convince the rest of the nation's Congressmen to give tax breaks to people that invest in coal powered plants.

So, regardless of the intended rationale, the tax breaks can often go off on tangents and serve no purpose other than to increase the chances of re-election of a few key Congressmen with enough seniority and power to wind up on key committees.

Or, tax breaks can go to people that can offer the most help in re-electing the Congressman, which would be people willing to donate large amounts of money to election campaigns, or at least to political action committees since there's limits to how much money a person can donate to a single candidate.

Or, as WhooWee mentioned, rich people are taxed so much that Joe Six Pack feels sorry for their misery and will only vote for Congressmen that will make a life a little more bearable for the nation's suffering rich. And when people earning 87% of the nation's income have to pay 97% of the nation's taxes, then they're definitely suffering.

That's at least a partly facetious answer. While I couldn't care less about people earning several hundred thousand dollars a year, you don't actually have to earn all that much before you're paying enough taxes per year that you could buy a new car with that amount of money. But I, like every other American, am not rich. Rich people make more than I do, lazy people make less than I do, while I'm just one of those poor, but honest folk that work hard for a living only to see the government take huge chunks of my hard earned money.

 

[WhoWee]

The rationale behind tax breaks is to encourage money to be invested into something that benefits the nation. For example, you want cleaner energy, so give tax breaks to those that invest in clean energy technology. Or you give tax breaks for sending yourself or your kids through college, since a college education should increase the quality of the nation's workforce.

In practice, Congressmen sell tax breaks for votes. They vote in tax breaks that will help the industries in their local area, which raises employment, makes the area more prosperous, etc. So if you're a Congressman from a district that has coal mines, you try to convince the rest of the nation's Congressmen to give tax breaks to people that invest in coal powered plants.

So, regardless of the intended rationale, the tax breaks can often go off on tangents and serve no purpose other than to increase the chances of re-election of a few key Congressmen with enough seniority and power to wind up on key committees.

Or, tax breaks can go to people that can offer the most help in re-electing the Congressman, which would be people willing to donate large amounts of money to election campaigns, or at least to political action committees since there's limits to how much money a person can donate to a single candidate.

Or, as WhooWee mentioned, rich people are taxed so much that Joe Six Pack feels sorry for their misery and will only vote for Congressmen that will make a life a little more bearable for the nation's suffering rich. And when people earning 87% of the nation's income have to pay 97% of the nation's taxes, then they're definitely suffering.

That's at least a partly facetious answer. While I couldn't care less about people earning several hundred thousand dollars a year, you don't actually have to earn all that much before you're paying enough taxes per year that you could buy a new car with that amount of money. But I, like every other American, am not rich. Rich people make more than I do, lazy people make less than I do, while I'm just one of those poor, but honest folk that work hard for a living only to see the government take huge chunks of my hard earned money.

nice.

The truth of the matter is that if you don't have any money to spend - you won't be able to take advantage of tax incentives for spending. To compensate for the "unfairness?" of this - politicians started tinking up things like EITC to redistribute tax revenues to people who don't pay federal income taxes.

I chuckle to myself every time I hear someone ignorant of business expenses and tax codes say something approximating - "they just write it off" - as if the company didn't have to actually pay the bill first and the great privilege is something more than not paying tax on their expense - that is the "write-off" is actually nothing more than the accounting for the expense for tax purposes. In order to "write-off" an expense - you need to pay for the item - being allowed to account for an expense is certainly not a windfall.

 

[mheslep]

Start from the bottom and cut.
http://www.federalbudget.com/

It is not enough to reduce the deficit. The deficit must be eliminated, and the debt reduced.This doesn't help either - http://www.census.gov/indicator/www/ustrade.html

Ok, why not give it a go in your field. NRC budget for 2012 is ~$1B. How much would you cut it? For my part I'd begin by zeroing out NRC Chairman Jaczko's salary.

BTW, with regards to budget talks on the table so far, it has been mentioned in this thread that there would be such and such a cut to the debt. The cuts mentioned are actually to spending; none of them are anywhere close to being sufficient to reduce the debt.

 

[Char. Limit]

This won't change much budget-wise, but a nice symbolic gesture would be for every Congressman and Congresswoman (and the Prez) to forgo their salary this year.

Ah, who am I kidding? That would never happen.

 

[WhoWee]

This won't change much budget-wise, but a nice symbolic gesture would be for every Congressman and Congresswoman (and the Prez) to forgo their salary this year.

Ah, who am I kidding? That would never happen.

Welcome back - new laptop?

 

[Char. Limit]

Welcome back - new laptop?

Thanks! Actually, it's my iPod. Turns out my Internet still works on this thing after all... so I decided to throw myself into P&WA again.

 

[Evo]

What about celebrities? They're filthy rich, do nothing, unless you consider lip synching, reality tv, and standing before a camera doing something for the public good. Yet their tax accountants find them tax shelters & loopholes to protect their money.

 

[drankin]

What about celebrities? They're filthy rich, do nothing, unless you consider lip synching, reality tv, and standing before a camera doing something for the public good. Yet their tax accountants find them tax shelters & loopholes to protect their money.

Can you provide an example?

 

[Evo]

Can you provide an example?

Celebrity royalties flow into Dutch tax shelters - Business - International Herald Tribune

The rock powerhouse U2 has transferred lucrative assets to Amsterdam, as have other pop singers and well-known athletes, all of whom have used or continue to take advantage of the Netherlands' tax shelters, according to a Dutch tax lawyer who requested anonymity because of client confidentiality agreements.

Entertainment companies and others that benefit handsomely from Dutch shelters include EMI, the record label, and CKX, the entertainment company that owns stakes in "American Idol," the Elvis Presley estate

continued...

http://www.nytimes.com/2007/02/04/business/worldbusiness/04iht-taxhaven.4461776.html

 

[WhoWee]

What about celebrities? They're filthy rich, do nothing, unless you consider lip synching, reality tv, and standing before a camera doing something for the public good. Yet their tax accountants find them tax shelters & loopholes to protect their money.

Aren't the celebrities in CA the only ones propping up inflated real estate prices, keeping the doors open on Rodeo, as well as the big restaurants? My guess is their agents, attorneys, accountants, and managers take a healthy share pre-tax as well.

 

[Evo]

Aren't the celebrities in CA the only ones propping up inflated real estate prices, keeping the doors open on Rodeo, as well as the big restaurants? My guess is their agents, attorneys, accountants, and managers take a healthy share pre-tax as well.

I don't know that celebrities are mainly in CA, they're all over the country, athletes, reality tv stars, music stars, etc... we're not talking Hollywood of the 30's-40's.

 

[WhoWee]

continued...

http://www.nytimes.com/2007/02/04/business/worldbusiness/04iht-taxhaven.4461776.html

Opps - you're talking about U2 and the Stones. They are global citizens - unrestricted by the rules of anyone country. Wasn't the top tax rate 90% in the UK in the late 1960's - just before the "British Invasion"?

 

[Evo]

Opps - you're talking about U2 and the Stones. They are global citizens - unrestricted by the rules of anyone country. Wasn't the top tax rate 90% in the UK in the late 1960's - just before the "British Invasion"?

No, those are just 2 rock groups mentioned. Read about the American celebrities.

 

[WhoWee]

I don't know that celebrities are mainly in CA, they're all over the country, athletes, reality tv stars, music stars, etc... we're not talking Hollywood of the 30's-40's.

Still, I don't think they keep as much as they'd like us to believe and as a group - they spend.

 

[daveb]

Ok, why not give it a go in your field. NRC budget for 2012 is ~$1B. How much would you cut it? For my part I'd begin by zeroing out NRC Chairman Jaczko's salary.

Oddly. most of the NRC's budget is recovered through licensing fees.http://www.nrc.gov/about-nrc/plans-performance.html"

 

[Evo]

Still, I don't think they keep as much as they'd like us to believe and as a group - they spend.

Here are some that messed up with bogus tax shelters or just refused to pay taxes at all and owe millions to the IRS.

http://www.foxnews.com/entertainment/2010/04/14/hollywood-uncle-sam-taxes/

 

[Ivan Seeking]

Once again, our good Senator Merkley's [D] office is the first to respond in specific terms.

Thank you for contacting me with your support for raising our nation's debt limit in a responsible manner. Like many Oregonians, I also believe that Congress must immediately act to raise our nation's debt limit to avoid throwing our economy back into a recession.

I have been deeply frustrated by some proposals which would raise our nation's debt limit only after requiring draconian cuts to domestic spending, which could result in hundreds of thousands of jobs lost, and dismantling programs like Medicare. Without a doubt, bringing our nation's annual deficits down is a priority. But we must do so in a balanced way that does not cost jobs now or damage our long-term economic competitiveness. Most importantly, Members of Congress should not be holding our nation's economy hostage by threatening to allow a default on obligations which we have already made.

Congress needs to act in a fiscally responsible manner when making policy decisions. Yet, it is important to recognize that our recent annual deficits are largely the result of massive tax cuts on the wealthiest among us, the cost of two long wars, and a new Medicare drug benefit, none of which was paid for. While our spending on non-defense programs is at the same level it was in 2001, defense spending has risen 74 percent, and spending on mandatory programs like unemployment insurance is up more than 30 percent due to the financial crisis and recession. At the same time, our revenue, reflected as a percentage of gross domestic product (the nation's total economic output), is at its lowest level since 1950, again as a result of the financial crisis and recession, as well as the Bush tax cuts. It is simply irresponsible for some in Congress to push for cuts in basic programs that middle class families and retirees rely on to educate our kids, protect our air and water, and provide a safety net for those in need – while continuing to hold special interest tax loopholes and tax cuts which benefit the very wealthy and well-connected off limits as a part of the deficit debate.

As the Senate continues to debate and work through budget issues, I will certainly take your views into consideration. Thank you for sharing your thoughts and please keep in touch.

All my best,

Jeffrey A. Merkley
United States Senator