History US tax rate history - A return to the glory days

[Dale]

I wonder what portion of businesses go overseas due primarily to our excessively high tax rate on businesses.

 

[turbo]

I wonder what portion of businesses go overseas due primarily to our excessively high tax rate on businesses.

Maybe you could find out and report back when you have some information.

 

[Dale]

So turbo-1, are you ever going to answer the question I have asked you twice, or are you going to continue to avoid it?

Would you personally work overtime if you were going to be paid at 50% of your base salary? How about 9%?

 

[WhoWee]

Because the people at the top have benefited disproportionately from the Bush cuts and the policies that allowed Wall Street and banks to wreck our economy and destroy jobs. It would be a good idea to keep some money in the hands of lower wage-earners who spend most of their income. Their consumerism is the driving force in our economy, and you can't create new jobs without a sustained short-term demand for goods and services.

Do you have any support for this turbo? It seems to me the tax incentives provided to families making less than $50,000 per year are quite lucrative - EITC especially - plus the Making Work Pay credit? Further, when you consider nearly 50% of all possible tax payers contribute little to nothing - or actually receive tax payments via re-distribution - how are the benefits of people at the top disproportionate - what are percentages? Again, please support your very specific claim (my bold).

 

[Ryumast3r]

That's an example of a clueless taxpayer not taking advantage of the tax code (individual filing), not a function of a nice raise cutting your income because you inched into a higher marginal rate (only charged on the earnings that exceeded that margin). There are some folks here that are only too happy to obfuscate and play semantic games, so let's not feed the trolls. M'kay?

That was my point, was that it's always possible to lose money, but that's not because of the tax-bracket, that's because you/your tax person was stupid.

So turbo-1, are you ever going to answer the question I have asked you twice, or are you going to continue to avoid it?

Would you personally work overtime if you were going to be paid at 50% of your base salary? How about 9%?

His original point was about a pay-raise, not about overtime.

 

[Dale]

His original point was about a pay-raise, not about overtime.

In my experience people generally only get significant pay raises for doing more work and taking more responsibility. So the overtime analogy is germane, particularly wrt the two examples I mentioned for which turbo called me a liar.

 

[Averagesupernova]

There is a shortage of engineers, so productivity would go down if I (and others) am not willing to work.

So let me get this straight. Somehow it is unacceptable to allow the market to adjust itself in pay increases for engineers so there is no longer a shortage?

 

[loseyourname]

I would like to expand this. Any company that is US-based and starts exporting jobs overseas ought to be taxed very heavily. My wife works for New Balance, and they do all they can to keep their manufacturing based in New England. They have moved some production off-shore in the past, in part because they couldn't comply with complex environmental regulations, but they maintain 3 manufacturing plants in Maine and two in Mass. Now, why doesn't the military buy training/exercise footwear from New Balance? Where is the money going? Nike, Reebock, Asics, etc? I apologize for pulling the thread off the subject of tax rates, but why can't companies like New Balance be given a fair shake when they keep so many (rare) shoe-making jobs right here in New England?

DLA-issue boots are currently purchased from Altama, I believe. At least that's what I was issued the last time I was actually issued boots. They're made in the USA, as any Berry Amendment-compliant item has to be, which means all clothing issued by the military is manufactured in the USA. As it stands, most servicemen I know of buy their own boots anyway, and the New Balance boots are actually extremely popular.

 

[WhoWee]

DLA-issue boots are currently purchased from Altama, I believe. At least that's what I was issued the last time I was actually issued boots. They're made in the USA, as any Berry Amendment-compliant item has to be, which means all clothing issued by the military is manufactured in the USA. As it stands, most servicemen I know of buy their own boots anyway, and the New Balance boots are actually extremely popular.

They purchase their own boots? Is this a matter of personal choice/variety/options? Is there a reimbursement?

 

[loseyourname]

They purchase their own boots? Is this a matter of personal choice/variety/options? Is there a reimbursement?

Well, I'm an officer and we actually purchase all of our uniforms, including boots, though we still get issued personal equipment like canteens and magazine holders and body armor. Enlisted personnel are given a uniform allowance, but officers pay for it themselves. You're issued boots in either basic training or through your commissioning source, but after that, you buy them yourself. It's a matter of personal preference what you buy but the boots obviously have to meet specs. Only the Marine Corps requires everyone to purchase exactly the same boots.

 

[WhoWee]

Well, I'm an officer and we actually purchase all of our uniforms, including boots, though we still get issued personal equipment like canteens and magazine holders and body armor. Enlisted personnel are given a uniform allowance, but officers pay for it themselves. You're issued boots in either basic training or through your commissioning source, but after that, you buy them yourself. It's a matter of personal preference what you buy but the boots obviously have to meet specs. Only the Marine Corps requires everyone to purchase exactly the same boots.

Has this been the practice for a long time? I can understand underwear and socks, but uniforms doesn't seem fair. However, when you compare a career officer to a police officer I guess it makes sense? Actually, I know a few police officers that have had to purchase their own vests - seem to recall about $600 to $700 each?

Just out of curiosity, are there any uniform service companies that provide uniforms?

 

[loseyourname]

I'm not sure what you mean by a uniform service company. I buy the combat uniforms directly from the Military Clothing Sales stores on post. I bought my dress uniform from Marlowe White. I bought my stetson (a 1st Cavalry Division requirement) from U.S. Cavalry. Altogether, everything I've purchased has probably cost around $1500 or so, including three pairs of boots, two hot-weather and one cold-weather. I don't even want to think about what it would cost to purchase my own personal protective equipment, such as the body armor. I've purchased my own gloves and ballistic eyewear for about $130, but the central issue facility on post does issue that. I just prefer the ones I bought myself. As a tanker, I actually wear nomex coveralls as my normal field uniform since we need to wear fire-retardant gear in the tank. I didn't have to buy that, though you can and some people do in order to get ones in a digital camo style. The ones issued are just plain green, but I personally prefer those ones anyway. It's also tanker tradition to get special tanker boots after qualifying on crew gunnery for the first time, and as the senior in rank guy in my crew, I'm expected to buy them for anyone new in my platoon, but you know, that's just meant to be a gesture of kindness, a sort of "welcome to the club" thing.

 

[WhoWee]

I'm not sure what you mean by a uniform service company. I buy the combat uniforms directly from the Military Clothing Sales stores on post. I bought my dress uniform from Marlowe White. I bought my stetson (a 1st Cavalry Division requirement) from U.S. Cavalry. Altogether, everything I've purchased has probably cost around $1500 or so, including three pairs of boots, two hot-weather and one cold-weather. I don't even want to think about what it would cost to purchase my own personal protective equipment, such as the body armor. I've purchased my own gloves and ballistic eyewear for about $130, but the central issue facility on post does issue that. I just prefer the ones I bought myself. As a tanker, I actually wear nomex coveralls as my normal field uniform since we need to wear fire-retardant gear in the tank. I didn't have to buy that, though you can and some people do in order to get ones in a digital camo style. The ones issued are just plain green, but I personally prefer those ones anyway. It's also tanker tradition to get special tanker boots after qualifying on crew gunnery for the first time, and as the senior in rank guy in my crew, I'm expected to buy them for anyone new in my platoon, but you know, that's just meant to be a gesture of kindness, a sort of "welcome to the club" thing.

There are companies that purchase uniforms (all types) and provide a pick up/drop off laundry service. They also mend as necessary. I know quite a few professional managers that use this type of (rental) service.

 

[Al68]

That's AI for yah.

Yeah, I can be a smarta$$ sometimes. I consider any statement claiming "there's no way" something could happen as a challenge.

BTW, it's not AI, it's Al, as in Al Pacino. I know it's hard to tell the difference on the screen.

 

[Ivan Seeking]

https://www.youtube.com/watch?v=JTzMqm2TwgE

 

[Al68]

https://www.youtube.com/watch?v=JTzMqm2TwgE

That presentation is the economics equivalent of the http://en.wikipedia.org/wiki/Chewbacca_defense" .

Sounds good, unless you actually listen to what he's saying and try to make sense of it. Then it falls apart like the nonsense it is.

He talks about connecting dots, then doesn't connect them. Then he pretends that he did, relying on the fact that his intended audience has no desire (or ability) to think for themselves. Typical left-wing fraud. And far too transparent for PF, IMHO.

 

[Ryumast3r]

I'd say it's quite a bit better than the Chewbacca defense.

Points 1 and 2 are spot on, the numbers may be a little off (not exactly double, etc), but it's basically totally true (I've looked it up before, cannot be arsed to look up the numbers right now but I will if you really really want me to).

3, the headline is correct: money = power, at least in our system.

4 isn't entirely true, but there is validity in that statement. Less money overall from less taxes = more money problems in the government, compound this with the fact that GDP as a whole went down in the recession, and less pieces of a smaller pie = deficit.

5 May not be entirely caused by the first, second, third, or fourth, but definitely results in #6, but is made easier by the fact that #1 and #2 happened. It is mostly a product of a lot of propaganda that's been going around demonizing unions since Reagan's time.

6 is a result of a weak middle class, which is caused mostly by more money not going to the middle class, also number 5 weakens the middle class further since unions are inherently a way (and one of the best really) for middle/lower class individuals to gain access to more benefits/money.

And his conclusion is correct: The only way to have a good recovery is to have a strong middle class.

The dots don't necessarily all connect in a linear fashion, but he does make very valid points.

Now that I've made a little more sense of this for you Al68, perhaps you'll come up with a real argument, instead of just saying it's "fraud."

 

[talk2glenn]

Al is correct; the video is nonsense.

Points 1 and 2 appear to follow only when you compare median income to average GDP. Obviously, because the distribution of incomes is titled to the left, median income will be lower than average income and, by simple definition average GDP.

In point of fact, since 1980 median income has risen by approximately 33%. Over the same period, the size of the labor force has increased by about 50%, as well. Accounting for both trends absorbs the majority of the change in GDP. It is complete nonsense that the "rich" have captured all of the gains from growth over the past three decades. Frankly, you'd have to be an idiot to regard that as fact after even the most cursory critical examination. Even if it were true that inflation adjusted earnings were flat over that period, you have access to comforts and conveniences available at cheap prices that were either prohibitively expensive or flat out impossible in 1980. Think about your smart phone, your home pc, the internet, etcetera. We are all in all likelihood better off at the median than even the top 20% were in 1980.

These arguments always rest on an appeal to envy: the architect points to the fact that some people are doing very well to distract from the fact that everybody is doing pretty well, and then argues that we need to change the system to prevent those people from continuing to do very well. Inevitably, this leads to everybody doing less well, not just the intended targets of the reform. In the abstract, even if it is true that some people in the economy enjoy a majority of its fruits (even while everybody else continues to see their lives improve, or gets a piece of the fruit, however slight), why does it follow that this is a "bad thing"?

Point 3 fails on its face, as well. Since 1980, the effective tax rate on the top quintile (the top 20% of income earners) has increased from 15.7% to 17.5%, while the effective rate on the bottom 20% has fallen from 4.1% to 1.5%. In fact, the taxes on the super poor have been slashed, by about 60%. Taxes on the super rich have increased by about 13%. This is because whatever monetary advantages the rich may have, politically, is more than offset by the popular value of the bottom 51% in terms of raw votes. Politicians spend lavishly on two popular categories: the old, and the bottom 60% One group votes, and the other is big enough to carry elections.

The rest claims to follow from points 1 through 3 and are therefore irrelevant. I will simply add that, whatever its other virtues, the argument that a strong middle class is a necessary prerequisite of strong economic growth is laughable on its face. The big growth stories of the latter half of the 20th century - Japan, China, and India - did so from basically agrarian societies with no middle class to speak of. In point of fact, the only prerequisites of accepted note are strong and consistent legal institutions, the protection of property rights, and capital mobility. Since 1980, the United States has systematically attacked all 3, to its detriment. This is the real root cause of any national economic anemia; the post-WW2 histories of Germany and Britain are an excellent case study. The minutia is just technical detail.

 

[WhoWee]

https://www.youtube.com/watch?v=JTzMqm2TwgE

What does Robert Reich's opinions have to do with the OP - care to elaborate?

I do enjoy listening to him though - especially when he says stuff like this:

http://michellemalkin.com/2009/01/2...m-skilled-workers-and-white-male-contractors/

"I am concerned, as I’m sure many of you are, that these jobs not simply go to high-skilled people who are already professionals or to white male construction workers…I have nothing against white male construction workers, I’m just saying there are other people who have needs as well"

PLEASE make sure you listen to his words on this video link.

 

[Al68]

And his conclusion is correct: The only way to have a good recovery is to have a strong middle class.

First, that was not a "conclusion" from anything else he said, it was an assertion with no specified relation to the preceding points. Second, it's a statement that nobody on the planet has ever disagreed with, equivalent to concluding "the sky is blue", fraudulently implying that others thought otherwise.

The dots don't necessarily all connect in a linear fashion, but he does make very valid points.

He claimed to be connecting dots, not stating unrelated points, some of which are true. The connections are implied, not stated, resulting in deception combined with plausible denial.

Now that I've made a little more sense of this for you Al68, perhaps you'll come up with a real argument, instead of just saying it's "fraud."

That video contains far too much nonsense to address it all, but I'll try to address this:

6 is a result of a weak middle class, which is caused mostly by more money not going to the middle class, also number 5 weakens the middle class further since unions are inherently a way (and one of the best really) for middle/lower class individuals to gain access to more benefits/money.

There seems to be an absurd but popular misconception that wealth is something that exists a priori, and who "gets" it is the relevant issue, and is a result of government economic policy. That's complete nonsense. Wealth is created, not "gained access to" (unless we're talking about a natural resource instead of produced wealth). Produced wealth simply does not exist prior to having a rightful owner. This misconception appears to be so ingrained in left-wing ideology that they are unable to comprehend that it's obvious nonsense, even when pointed out. And I honestly don't know how to explain it without knowing the reason for the apparent lack of comprehension.

 

[Tosh5457]

The argument that raising taxes on the riches hurts more poor than not doing it could be true some time ago, but not today. Companies cash reserves and lliquid assets have been growing excessively since the early 80s (can't find another chart that shows it since the 80s).

http://www.clevelandfed.org/research/trends/2011/0111/01regact-1.gif

If CEOs don't want to invest (and use that money to speculate in financial markets instead, which isn't productive), why should taxes be lower? This is not a taxes problem, it's a problem caused by stagnated economy. This is just one of the big problems you don't see economists talking about, like you don't see many economists talking about the productive sector of US shrinking while the financial (non-productive and heavily debt-dependant) sector grows excessively, since the 80s:

[PLAIN]http://www.kauffman.org/uploadedImages/Financial-Sector-as-Percentage-of-GDP.jpg

What contributes for US debt? Households, having troubles keeping the same standards of living, and the financial sector:

[URL]http://www.contrahour.com/.a/6a00d8341d7ef253ef010536ecdd7c970b-800wi[/URL]

US's economy can't keep growing like that.
Everyone should read http://monthlyreview.org/press/books/pb1849/" by Fred Magdoff and John Bellamy Foster. I've never seen a better explanation of the flaws of capitalism and the causes of our current problems. In some years or decades we're all going to realize how these economists were right, and mainstream economics was wrong...

Sorry for the big offtopic.

 

[CAC1001]

This Robert Reich video has numerous fallacies. Note how he pulls two stunts, which is to cite wages and act as if America is divided into fixed classes. Wages are not incomes. Wages are a part of incomes. Incomes are wages plus the various fringe benefits that people get. In certain areas, wages have been stalled, yes, even though incomes per capita have been going up, but that is because of the rising cost of healthcare which is making it where more and more of a person's income is having to go towards healthcare costs instead of wages.

And "the top 5%" are not a fixed class. There is not a permanent poor class, a permanent middle-class, and a permanent rich class that people are born into, there are income quintiles. The actual people in those income quintiles change all the time. Many of the people currently in the top 5% were in the bottom earners ten, twenty, or thirty years ago, and probably quite a few in the middle-income quintiles or even lower-income quintiles now are folks who were in the highest-earning quintiles up until the recession hit.

So when Leftists say things like, " 'The Rich' have gained X amount over the years," it's really a nonsensical statement, because "The Rich" are oftentimes the same people who were "The Poor" some years ago. Also, Mr. Reich might bother looking at just who has gotten the major tax cuts over the years. We currently have 50% of Americans paying ZERO Federal income tax, with more of the overall tax burden being shouldered by the highest-earning 5%.

President Bush cut taxes for everyone, with some of the biggest percentage cuts going to the bottom earners. And he did things like double the Child Income Tax Credit from $500 per child to $1000 per child. It is through these various tax credits that many people end up paid by the federal government as opposed to paying it. No politician could say it, but really what needs to be done at some point is to re-levy taxes on this 50% not paying anything. I'm not saying lower and middle-income people should pay high taxes by any means, but the ones not paying anything, that needs to stop, especially the ones getting paid by the government. There also is the problem in that while the amount of tax revenue as a percentage of the GDP that the government takes in has stayed relatively uniform, government spending per capita has continually been increasing over the years. In addition, he seems to expect equal gains across the economy. Of course the wealthier are going to gain more than the lower earners, otherwise they would never have gotten wealthy in the first place. And also, again, "The Rich" aren't a fixed class.

Regarding public schools and infrastructure, well the U.S. has some of the highest per pupil spending with not necessarilly the best results, and if one compares on a state-to-state level, it depends. Some states spend more and get better results, some states spend less and get better results. Washington D.C. has the highest per pupil spending with some of the worst results. As for infrastructure, well we had a $820 billion stimulus of which only a fraction was allocated for infrastructure work.

 

[WhoWee]

The argument that raising taxes on the riches hurts more poor than not doing it could be true some time ago, but not today. Companies cash reserves and lliquid assets have been growing excessively since the early 80s: http://www.tradersnarrative.com/wp-content/uploads/2010/06/corporate%20cash%20hoard%20record%20Jun%202010.png"

If CEOs don't want to invest (and use that money to speculate in financial markets instead, which isn't productive), why should taxes be lower? This is not a taxes problem, it's a problem caused by stagnated economy. This is just one of the big problems you don't see economists talking about, like you don't see many economists talking about the productive sector of US shrinking while the financial (non-productive and heavily debt-dependant) sector grows excessively, since the 80s. Everyone should read http://monthlyreview.org/press/books/pb1849/" by Fred Magdoff and John Bellamy Foster. I've never seen a better explanation of the flaws of capitalism and the causes of our current problems. In some years or decades we're all going to realize how these economists were right, and mainstream economics was wrong...

I couldn't open your link.

However, I would agree there is a "flaw" from the average American perspective. That is, Capitalism is a global system - not just US based. Accordingly, when labor in the US prices itself out of the market and the tax policy becomes too harsh - capital flees the country in search of more productive locals- IMO.

 

[Tosh5457]

And also, again, "The Rich" aren't a fixed class.

I'm pretty sure most rich people come from rich families.

 

[Mech_Engineer]

I'm pretty sure most rich people come from rich families.

You're going to need to provide a link proving that. "I'm pretty sure" won't cut it.

 

[turbo]

I'm pretty sure most rich people come from rich families.

With rights to inheritance firmly protected by right-wingers. The GOP chants about "death taxes" are pretty lame. Wealthy people have all kinds of ways to shelter their assets, set up trusts, etc, and the GOP would have us believe that when a wealthy person dies, the government swoops in and scoops up all their assets. Sadly, some US voters swallow that with no education or knowledge on the law.

It is lost on many tea-partyers that inheritance taxes apply only to pretty large estates, and only on people who have failed to shelter their assets and incomes appropriately. The "death tax" is pretty much an "ignorant and failed to plan tax".

 

[Tosh5457]

You're going to need to provide a link proving that. "I'm pretty sure" won't cut it.

Hehe I knew someone would say that. I looked for a link proving that, but couldn't find any. I read that in a book some time ago, but can't remember what book was that

 

[CAC1001]

I'm pretty sure most rich people come from rich families.

Actually, it's the opposite, most wealthy people are self-made:

http://blogs.wsj.com/wealth/2008/01/14/the-decline-of-inherited-money/?mod=WSJBlog

http://blogs.wsj.com/wealth/2008/04/11/earners-vs-heirs/

 

[WhoWee]

With rights to inheritance firmly protected by right-wingers. The GOP chants about "death taxes" are pretty lame. Wealthy people have all kinds of ways to shelter their assets, set up trusts, etc, and the GOP would have us believe that when a wealthy person dies, the government swoops in and scoops up all their assets. Sadly, some US voters swallow that with no education or knowledge on the law.

It is lost on many tea-partyers that inheritance taxes apply only to pretty large estates, and only on people who have failed to shelter their assets and incomes appropriately. The "death tax" is pretty much an "ignorant and failed to plan tax".

Here a tax - there a tax - everywhere a tax-tax (is that catchy or what?).

http://online.wsj.com/article/SB10001424052748703675904576063903166546250.html

Why should anyone have to spend time and resources to hide their assets and protect future generations from the Government? Isn't it bad enough we're passing on over $14Trillion in debt (and increasing) to our future generations?

I need to disclose my recent professional (20 hour) re-certification in this area (estate planning) and can site case studies for the next several pages.

Accordingly, please consider the family with $3.0 to $5.0 million in property, plant and equipment (maybe an older and struggling paper mill, fabricating or a meat plant?) but only $50,000 to $100,000 in cash and no current ability to borrow at a bank. How do they protect themselves from a 55% estate tax?

 

[Ryumast3r]

We currently have 50% of Americans paying ZERO Federal income tax, with more of the overall tax burden being shouldered by the highest-earning 5%.

Source on this please? I'm interested to see this, as I have seen that number thrown around a lot but have not personally seen anything reflecting that.

 

[talk2glenn]

This data is from 2004. With the combined stimulus legilsation, I wouldn't be surprised if that 3% figure had reached zero or turned negative for 2011. But the 3% should be more persistent, assuming no change in existing tax laws (eg, "Bush tax cuts").

 

[CAC1001]

Source on this please? I'm interested to see this, as I have seen that number thrown around a lot but have not personally seen anything reflecting that.

http://www.taxpolicycenter.org/UploadedPDF/412106_federal_income_tax.pdf

 

[WhoWee]

http://www.taxpolicycenter.org/UploadedPDF/412106_federal_income_tax.pdf

From the link: my bold

"The
proliferation of those tax expenditures, now totaling
nearly $1 trillion annually, has reduced income taxes for
most Americans and pushed many off the tax rolls entirely. TPC estimates that 45 percent of households will
owe no federal income tax in 2010 (see table) and that more
than 90 percent of them will get government payments
through refundable tax credits."

 

[Vanadium 50]

Source on this please? I'm interested to see this, as I have seen that number thrown around a lot but have not personally seen anything reflecting that.

You can get this from the IRS' web site. Lots and lots of spreadsheets there.

Here's the approximate breakdown:

• 30% "pays" negative income taxes - i.e. gets a refundable net tax credit.
• The next 20% pays no income tax.
• The next 40% pays half the income tax.
• The last 10% pays the other half.

 

[Al68]

It is lost on many tea-partyers that inheritance taxes apply only to pretty large estates, and only on people who have failed to shelter their assets and incomes appropriately. The "death tax" is pretty much an "ignorant and failed to plan tax".

I'd say that's lost on many left-wingers, far more so than tea-partyers. Most tea partyers know full well that the Kennedy's aren't the ones paying it.

Right-wingers are often chastised for using family farms, instead of the Kennedy's, as an example, then accused of being for the rich for opposing the "death tax", under the left-wing assumption that it's a tax on the "super-rich", then accused of not realizing that the really rich aren't the ones paying it. Duh!

 

[russ_watters]

https://www.youtube.com/watch?v=JTzMqm2TwgE

Hmm... so basically, the middle class hasn't managed to improve itself, yet has managed to cut its contribution to tax revenue, while the rich, which is responsible for all of our economic advancement in the past 20 years has been forced to pay an ever-increasing share of the revenue both in absolute (total $$$) and fractional ($$$ per person) terms. So I think I agree with him: the rich are getting soaked while the middle class and poor are coasting along and dragging the country down.

...oh, and of course, the statement about dropping federal services is a lie - we all understand that, right? You can't have a tax revenue and spending that increases faster than inflation while simultaneously having a decrease in services unless someone is stuffing that money under a mattress. Perhaps what he meant to say is the typical services of the government are being swamped by our ever-increasing "entitlement" spending?

 

[WhoWee]

Not that Robert Reich isn't entertaining - the CBO report might be more productive:

http://www.cbo.gov/
"CBO'S 2011 LONG-TERM BUDGET OUTLOOK

The nation's budget outlook is daunting. Without significant policy changes, an aging population and rising per capita health care costs will lead to surging federal debt, according to CBO's latest Long-Term Budget Outlook."

...
Please read the full report - including their conclusion:

"To keep deficits and debt from climbing to unsustainable levels, policymakers will need to increase revenues substantially as a percentage of GDP, decrease spending significantly from projected levels, or adopt some combination of those two approaches. Making such changes while economic activity and employment remain well below their potential levels would probably slow the economic recovery. However, the sooner that medium- and long-term changes to tax and spending policies are agreed on, and the sooner they are carried out once the economy recovers, the smaller will be the damage to the economy from growing federal debt. Earlier action would permit smaller or more gradual changes and would give people more time to adjust to them, but it would require more sacrifices sooner from current older workers and retirees for the benefit of younger workers and future generations."

 

[Char. Limit]

Not that Robert Reich isn't entertaining - the CBO report might be more productive:

http://www.cbo.gov/
"CBO'S 2011 LONG-TERM BUDGET OUTLOOK

The nation's budget outlook is daunting. Without significant policy changes, an aging population and rising per capita health care costs will lead to surging federal debt, according to CBO's latest Long-Term Budget Outlook."

...
Please read the full report - including their conclusion:

"To keep deficits and debt from climbing to unsustainable levels, policymakers will need to increase revenues substantially as a percentage of GDP, decrease spending significantly from projected levels, or adopt some combination of those two approaches. Making such changes while economic activity and employment remain well below their potential levels would probably slow the economic recovery. However, the sooner that medium- and long-term changes to tax and spending policies are agreed on, and the sooner they are carried out once the economy recovers, the smaller will be the damage to the economy from growing federal debt. Earlier action would permit smaller or more gradual changes and would give people more time to adjust to them, but it would require more sacrifices sooner from current older workers and retirees for the benefit of younger workers and future generations."

Without significant policy changes, an aging population

an aging population

Our population really needs to stop doing that!

 

[daveb]

Our population really needs to stop doing that!

Maybe Nolan and Johnson had it right (see "[URL .[/URL] By the way, IMDB shows a remake of the movie in the works.

 

[Char. Limit]

Nah. It can be solved if we as a country just have more children (and raise them better). It will take over 20 years to fix, but it will also be a GOOD fix.

 

[WhoWee]

Nah. It can be solved if we as a country just have more children (and raise them better). It will take over 20 years to fix, but it will also be a GOOD fix.

Well, that's one long term strategy - you better get started as the heaviest part of the debt is falling squarely on you and your kids unfortunately.

 

[mege]

With rights to inheritance firmly protected by right-wingers. The GOP chants about "death taxes" are pretty lame. Wealthy people have all kinds of ways to shelter their assets, set up trusts, etc, and the GOP would have us believe that when a wealthy person dies, the government swoops in and scoops up all their assets. Sadly, some US voters swallow that with no education or knowledge on the law.

It is lost on many tea-partyers that inheritance taxes apply only to pretty large estates, and only on people who have failed to shelter their assets and incomes appropriately. The "death tax" is pretty much an "ignorant and failed to plan tax".

Why must someone 'shelter' their assets? So, creating a family corporation is the only way to do proper inheritance now? If the tax is really just a 'failed to plan' tax then something is horribly wrong.

I forget the cutoff now, but federal inheritance tax kicks in at $700,000 total assets? That's really not that much considering many career folks are going to retire with at least that much with minor effort. So a 65 year old middle-manager croaks, has a million dollar nest egg, had his will all lined up and the government takes half of it. What's the failure to plan there?

 

[OmCheeto]

Source on this please? I'm interested to see this, as I have seen that number thrown around a lot but have not personally seen anything reflecting that.

I always get depressed when I look into the numbers regarding income and taxes, and very seldom get involved in what I consider tunnel vision tax discussions.

Counting both income and payroll taxes, less than 13 percent of households would not pay tax

from CAC1001's link
http://www.taxpolicycenter.org/Uploa...income_tax.pdf



The misleading key words that has been bandied about here are "income tax".

If one counts all taxes: Federal, State, and Local, I'm sure that number drops to near zero.

On the following link: http://cfo.dc.gov/cfo/frames.asp?doc=/cfo/lib/cfo/09STUDY.pdf

one can extract from a city of your choice, who's paying how much.

Philadelphia is first on the lists, so I'll go with them:

ESTIMATED BURDEN OF MAJOR TAXES FOR A HYPOTHETICAL FAMILY OF THREE, 2009
income____tax burden
$25,000___16.4%
$50,000___13.7%
$75,000___12.4%
$100,000__12.1%
$150,000__10.9%

One of the federal tax numbers that is interesting to look at from one of the http://www.taxpolicycenter.org/numbers/displayatab.cfm?DocID=2974&topic2ID=150&topic3ID=159&DocTypeID=1":

23,767,000 filers, or 14.7% if the total filers, had an average income of $5788 , with a negative tax burden of $51.

bugeyes mine

I wonder what their state and local tax burden in the DC study would have been.

Oh. And here's some more http://www.dailyfinance.com/2011/06...low-taxes-on-the-rich/?icid=sphere_copyright".

 

[Al68]

...And here's some more http://www.dailyfinance.com/2011/06...low-taxes-on-the-rich/?icid=sphere_copyright".

LOL, you certainly labeled that link correctly: I had to stop reading after this in the first paragraph:

"In May, America's debt slammed against its officially set limit of $14.3 trillion, and almost everyone agrees that the federal government needs to come up with a lot more money."

On second thought, you left out the word "delusional".

 

[OmCheeto]

LOL, you certainly labeled that link correctly: I had to stop reading after this in the first paragraph:

"In May, America's debt slammed against its officially set limit of $14.3 trillion, and almost everyone agrees that the federal government needs to come up with a lot more money."

On second thought, you left out the word "delusional".

I actually didn't read the article, but only watched the video.

But I see that the video seems to have taken excerpts from the article. The following is something I've been writing my congressmen about:

But base pay is only a fraction of (Ralph)Lauren's income. He also owns about $3.42 billion worth of stock in his company. In 2003, President Bush lowered the top capital gains rate to 15%, meaning that, if Lauren were to sell shares that he had held for at least a year, he would pay taxes on his profits at the same rate as someone who makes $8,400 per year. In 2010, he did just that, selling $850 million in shares -- and paying just 15% on the proceeds.

Even though I'm an investor now, and would see my profits drop, it strikes me as illogical for the richest people to pay the same tax rate as the poorest.

 

[Al68]

Even though I'm an investor now, and would see my profits drop, it strikes me as illogical for the richest people to pay the same tax rate as the poorest.

Me, too, but that's not the reality of the situation. Even in that example, the rich paid proportionately higher taxes than the poor, and that example was nonsense.

In reality, rich people don't just pay proportionally more, they pay a much higher percentage in taxes, and a disproportionately higher share of the total tax burden. This has been shown repeatedly in this forum, but here's the same link to CBO data I have provided many times: http://www.cbo.gov/ftpdocs/88xx/doc8885/EffectiveTaxRates.shtml.

Of course that still ignores the fact that the bulk of taxes collected "from the rich" is not taken from their pockets, it's taken from their investment capital. Unlike the poor and middle class, rich people invest most of their money. Capital gains taxes in particular come from the investment capital of rich people, not their pockets or fat cat cigar funds.

 

[russ_watters]

Even though I'm an investor now, and would see my profits drop, it strikes me as illogical for the richest people to pay the same tax rate as the poorest.

Like your comment above about payroll taxes, it is only illogical if you consider a lot of different forms of received money and taxes paid to be identical. The reason people talk about the federal income tax differently from the payroll tax is the federal income tax is what you pay to fund the normal functions of government. The payroll tax is basically funding a federally run insurance and investment company. The reason that it is important to separate SS, in particular, from regular taxes is that it was sold to the American people as a retirement savings plan, where what you pay in determines what you get out. If the pay-in is divorced from the pay-out, it just becomes another type of welfare. I'm sure liberals and poor people would love that, but it would be a much harder sell for conservatives and middle class+. And the reason including it makes the numbers seem less skewed is because the rich are mostly ineligible for the program.

 

[OmCheeto]

Me, too, but that's not the reality of the situation. Even in that example, the rich paid proportionately higher taxes than the poor, and that example was nonsense.

In reality, rich people don't just pay proportionally more, they pay a much higher percentage in taxes, and a disproportionately higher share of the total tax burden. This has been shown repeatedly in this forum, but here's the same link to CBO data I have provided many times: http://www.cbo.gov/ftpdocs/88xx/doc8885/EffectiveTaxRates.shtml.

Of course that still ignores the fact that the bulk of taxes collected "from the rich" is not taken from their pockets, it's taken from their investment capital. Unlike the poor and middle class, rich people invest most of their money. Capital gains taxes in particular come from the investment capital of rich people, not their pockets or fat cat cigar funds.

Ok then. Round and round we go.

As I've pointed out before, from your link, the top 5% of wage earners take home, after taxes, in one year, what the bottom 20% take home, after taxes, in 20 years.

I would do the math, as to what the deficit would now be if we'd kept multiple tax brackets. With the top one being at around 50%, but I've been summoned to the river.

And nothing, absolutely nothing, trumps life.

Salam

 

[Al68]

Ok then. Round and round we go.

As I've pointed out before, from your link, the top 5% of wage earners take home, after taxes, in one year, what the bottom 20% take home, after taxes, in 20 years.

I never said otherwise. You just pointed out something that neither supports your position nor refutes mine in any way.

The reason we go "round and round" is that after I showed your first claim to be utterly false, you just switched to a completely different claim, as if your second claim were the one in dispute, or supported your first claim in some way. Neither is true.

 

[turbo]

Ok then. Round and round we go.

As I've pointed out before, from your link, the top 5% of wage earners take home, after taxes, in one year, what the bottom 20% take home, after taxes, in 20 years.

I would do the math, as to what the deficit would now be if we'd kept multiple tax brackets. With the top one being at around 50%, but I've been summoned to the river.

And nothing, absolutely nothing, trumps life.

Salam

Please don't be too sensible. You'll be called a Marxist Commie.