Questions to Consider

>> Tuesday, September 27, 2011



But I have to present it...

No one gets rich without the blood, sweat and taxes of ALL Americans?

If I make a million dollars day-trading.... I have no factory, no product ships over any highway... and thieves like Warren tell me that government has a right to expect and insist I "pay it forward"? To who? The poor? Did the poor help me make my trades? Did they tell me when I should sell or buy? Did they offer stock tips? At present government is entitled to 15% capital gains tax on long terms trades... on money that has already been taxed once! That percentage jumps considerably higher for short term (of which day-trading is) capital gains. Even at that, the question still remains to be answered by ANY Republican candidate, 'how much of every dollar I earn should I be allowed to keep?'

Ideologues like Elizabeth Warren will say: 'you can have whatever is left after all the underachievers, moochers, and government spendthrifts and wastrels, are appeased.

48% of wage earners pay no federal income tax at all (after IRS refunds); many of that 48% get more back than what they paid in via EITC. What happens when that number breaks the 50% threshold? A permanent underclass dependent upon government handouts and a permanent party power-structure in Washington... Freedom in America will be, effectively, dead. Our Republic will be finished.

As it stands now 86% of all federal income taxes are paid by the top 25% of wage earners. The top 50% of wage earners pay 96% of all federal income taxes. What happens when the top 55% of wage earners are paying ALL federal income taxes? Refer to the previous paragraph: the republic will be dead. American will be dead.

When is a rich person's "fair share" paid in full? When 50 cents of every dollar is going to the government (including income, capital gains, state, city, & local taxes)? 60 cents? 70 cents? 80 cents? 90 cents out of every dollar? How much of one's labor is considered inviolable to government forfeiture?

And just who is rich?

Elizabeth Warren is the worst kind of thief. She doesn't steal to satisfy a personal need, she steals to make herself feel good about helping those she deems 'downtrodden.'

She wants you to give her money so she can steal from you when she wins.

Well, we have enough of those in Washington already. 

26 comments:

Bloviating Zeppelin September 27, 2011 at 2:15 PM  

Warren is another DO-NOTHING who produces nothing, made nothing, built nothing, never met a payroll, never had to manage a fleet of vehicles, a big room of employees, handle workers comp issues. Instead, she is an attorney and professor.

Another professional student and GOWP.

Wow. I'm impressed.

BZ

BenT - the unbeliever,  September 27, 2011 at 3:11 PM  

"To who? The poor? Did the poor help me make my trades? Did they tell me when I should sell or buy? Did they offer stock tips?"

No but the United States still provides incalculable services to your hypothetical investor.
1. The Security and Exchange Commission keeps the companies you invest in from lying to you.
2. The judicial branch provides redress if you are scammed.
3. The FDIC guarantees your money.
4. The Defense dept. makes sure invaders don't ransack our country and carry away your property.
5. The Executive branch and law enforcement in all forms keep the plebeian hordes from storming your mansion with flaming torches and pitchforks.
6. The Treasury Dept. creates and manages the currency you use to invest, keeping the exchange rate stable.

As you can see your mythical investor is no island.

BenT - the unbeliever,  September 27, 2011 at 3:28 PM  

"48% of wage earners pay no federal income tax at all (after IRS refunds); many of that 48% get more back than what they paid in via EITC. "

1. The EITC was enacted under Pres. Gerald Ford (republican) after Pres. Nixon introduced the idea. and was expanded under Reagan, Clinton and Bush II. So this is hardly a pure liberal program.

2. If 48% of the country make so little that a tax refund rebates all their income taxes plus some then we have a problem of poverty not tax avoidance.

3. And still those that get a refund on their income tax still pay Social Security and Medicare taxes, which for most people is about 15% of their income.

4.But even that 48% is a lie because half of that number is seniors who have little income except for social security.

BenT - the unbeliever,  September 27, 2011 at 3:36 PM  

"As it stands now 86% of all federal income taxes are paid by the top 25% of wage earners. The top 50% of wage earners pay 96% of all federal income taxes."

I guess we could tax the poorest half of our country more, but I don't know why. The poorest 50% of the country will never pay 50% of the federal revenue.

In fact if you look at income, the top 25% of the country takes in over 90% of the US income each year, so why aren't the top 25% paying 90% of the federal revenue?

Low capital gains taxes that's why! An investor can bring home a million dollars in income and pay $150,000 in taxes. And 35 factory workers can bring home a million dollars in income and pay $300,000 in taxes.

BenT - the unbeliever,  September 27, 2011 at 4:09 PM  

"When is a rich person's "fair share" paid in full? When 50 cents of every dollar is going to the government (including income, capital gains, state, city, & local taxes)? 60 cents? 70 cents? 80 cents? 90 cents out of every dollar?"

Well from the 1940's thru 1960's the top tax rate for income over $1million was 90% and the US seemed to prosper. And America paid off it's debts from World War II.

In 1964 the top rate was lowered to 74% for those making over $500,000. And since then it has fallen to 50% in 1982 and 39% for top earners in 1994 and now the top rate is 33%.

In that same period tax rates for other brackets have fallen too. It's all in an easy to read chart at Wikipedia.

And it tells the problem plainly. All those bridges and roads built during the Eisenhower days are collapsing because the federal government isn't getting the money from the populace like it was during those years.

None of us today pay tax rates like our parents and grandparents did. ... But the situation is even worse when you consider these details in line with other facts of today's income.

Today's workers salaries and incomes are not increasing like they were for our parents and grandparents [chart] Since the 1970's income growth has been stagnant for the bottom 80% of America, that means even though we pay lower taxes than our parents, today's taxes bite us harder and harder because of inflation.

That same growing income inequality paired with low top tax rates means that the government revenue falls faster and faster.

Perhaps we need to return to the tax rates of the 1950's and 60's when we paid off our debts with high tax rates.

BenT - the unbeliever,  September 27, 2011 at 4:15 PM  

"At present government is entitled to 15% capital gains tax on long terms trades... on money that has already been taxed once!"

Money doesn't stop and start. You get money from investments and it's taxed, you spend that money on groceries and it's taxed, the grocer buys products and it's taxed, the wholesaler pays employees and it's taxed, the employees invest the money in their 401k and it's taxed when it's withdrawn.

Investors, especially professional investors, are saying they should get special preferential treatment on their income. I have no idea why.

Jim September 27, 2011 at 11:33 PM  

Ben, you forgot to mention the Internet allowing day traders to be day traders that was created by government-funded research.

Otherwise, very well said. I would also add that capital gains has NOT already been taxed. The principle yes. The gain, no.

Edwin Drood September 28, 2011 at 8:09 AM  

How can anyone with the power of logical thought think that it was government infrastructure what made entrepreneurs rich? If that was true then why isn't everyone rich, we all enjoy the same government don't we?

Using Mrs Buffets logic we should tax the poor, it is them who take the most in welfare and police action. They use our prisons way more 100k a year per inmate. They rely on public transportation, they need healthcare.

When compared to the rich they can't even create there own jobs, they rely on someone else.

Of course this is all ridiculous but at least it shows how ridiculous Buffets logic is.

ELAshley September 28, 2011 at 8:38 AM  

Did I malign the EITC as a 'hated' liberal program? It doesn't matter who thought it up, who penned it, who signed it into law, or who reaffirmed it. It's wrong. You need to get past this hangup you have about me and other conservatives; that simply because a conservative thought it or installed it we automatically agree with it.

"But even that 48% is a lie because half of that number is seniors who have little income except for social security." This is simply idiotic. I could easily say that this number is also wrong because *half* of *that* number is comprised of young blacks who can't find a job anywhere. It doesn't matter which 'free of federal income tax liability' constituency group you pull out of the hat, they all still add up to 48%. 48% of American wage earners pay no federal income tax (after returns) to the federal government. Social Security and Medicare are separate issues.

"In fact if you look at income, the top 25% of the country takes in over 90% of the US income each year, so why aren't the top 25% paying 90% of the federal revenue?"

And this beautifully illustrates the evilness of your position. Men like Warren Buffet, then, should only be allowed to keep .001% of his holdings. After all, no one should be able to keep 52.23 billion-- no could possibly have a need for that much cash. And even at .001% he would still get to keep 56 million dollars. And Gosh! No one really needs that much money either. So why doesn't the government just confiscate it all and send out a check every month to Mr. Buffett that will allow him to keep himself in the lifestyle to which he has become accustomed...... no, wait... let the man live off the standard monthly social security stipend. It's only fair, after all. Take it all away, and force him to live like all the other poor dupes he robbed of meaningful wages throughout his lifetime.

I don't care how much or how little a man makes. No government has the moral right to take a larger percentage of ANY man's labor than the laborer himself. This is called theft. It's evil.

You want to position yourself as a moral man, and part of a moral society because you want to take care of the poor and downtrodden. Bravo! But you become the very thing you hate when you, by the artifice of oppressive progressive taxation, keep the rich on a sliding scale of taxation (upward) dependent upon what new spending the government feels it just can't live without.

It is immoral. And, as I've already articulated, it's downright evil. Puff yourself up all you want, and give yourselves awards for being the most humane and generous (with other people's monies) of political persuasions all you wish. But God only demands 10%. And He's not short of cash.

Government has a SPENDING problem... not a revenue problem. It seeks to right phantom wrongs with theft.

BenT - the unbeliever,  September 28, 2011 at 11:26 AM  

"48% of American wage earners pay no federal income tax (after returns) to the federal government."

You are wrong it's not wage earners it's people who file income tax returns. 20% of Americans are seniors with little income other than Social Security. They file tax returns, but we don't charge them income tax on Social Security. It's criminal!

And then we have the nation's poor. According to the recent census the US has a poverty rate of 15%.

So add 20% and 15% and the real number of Americans not poor or elderly on SS that pay no income tax is 13%.

Edwin Drood September 28, 2011 at 12:22 PM  

A family of 4 earning 47k a year doesn't have to pay federal income tax.

Average house hold income is 48k.

Average US household is approx. 4 (not counting all the single parents, but they don't pay taxes either)

So when combined with retirees and the poor at a minimum 45%-50% of people don't have to pay any federal income taxes.

Jim September 28, 2011 at 11:18 PM  

ED at 8:09 AM, OMG!

"Men like Warren Buffet, then, should only be allowed to keep .001% of his holdings. After all, no one should be able to keep 52.23 billion-- no could possibly have a need for that much cash."

Geezus, ELA, are you that addled? Or are you simply the master of straw men?

We're talking 4.6% here. "Oppressive progressive taxation"?

Thank God you are here, Ben. I couldn't do this by myself.

A large majority of Americans favor higher taxes on higher income earners in order to help America's financial situation. What's the matter with you guys?

Marshall Art September 29, 2011 at 2:49 AM  

Jim,

I believe you are mistaken about capital gains taxes. The shareholders are owners of the company who receive their cut of the already taxed profits of that company and then are taxed again. This article explains it well.

Without asking for the polling data, your claim about the majority of Americans favoring a tax hike on the wealthy is the result of liberal brainwashing. We know that taxing all the wealthy at 100% will not help in any significant way. But worse, if we assume the claim is correct, that speaks ill of the large majority of Americans that they would be so covetous.

The issue isn't that we have a debt that we lack funds to cover, it is that people like you have voted for the types of politicians that felt the federal government should be involving themselves in so many places that the debt would grow as it has. I do not give Republicans a pass, either, but the difference is I don't elect any to do such things. Some do such things in spite of what I'd prefer.

Spending cuts is what is needed, as well as tax and regulation reduction. But spending is the easiest. Every group involved in a federal program knows damned well they can get by with less, so right off the bat, savings can be had without eliminating anything.

But eliminate we must and there are plenty of places that can be 86'd with no gripes from that same large majority of Americans. From simple things like funding for PBS, NEA and the like, to doing away with unnecessary outfits like the EPA, which is doing much to delay our economic recovery.

ELAshley September 29, 2011 at 8:55 AM  

Jim, you said...

"A large majority of Americans favor higher taxes on higher income earners in order to help America's financial situation."

You're right. A majority of Americans DO favor higher taxes on higher income earners. The rhetoric of the left has infected even the ranks of conservative voters. BUT... Simply because a majority favors a thing, it doesn't make that thing right.

And no straw men, Jim. Simply a question... how much is enough for the federal government? There doesn't seem to be an answer.

If you don't know this, you should, but unless government is reformed (within the confines and context of our constitution, of course) government will simply waste what it's taken in then demand the rich... yet again... pay their "fair share."

That's the question, Jim. How much is a "fair share"? Ben reminded us that there was a time when "fair share" meant 90% of ones total earnings forfeited in taxes. That such a rate was exacted by ANY government, let alone ours...! It's evil, Jim. thank God all you want for Ben's voice, but to lose 90% of ones earnings in taxes IS evil.

If you can't see that this is fundamentally evil... then there is no hope for you. You lament that you couldn't do "this" without Ben's help? Do what? push the thought that every penny earned is subject to forfeiture at the whim of a benevolent government?

No straw man here, Jim. I just want to know where it ends, and just what, in clear, concise, real-world numbers, a "fair share" is.

You say you're talking 4.6%? Well, that's a nice cutesy number! But let's add it to the numbers many of the rich are already paying. Depending upon which state a "rich" wage earner lives, he's already paying upwards of 50% in total tax liability. So yes, let's add another 4.6 percent and push it closer to 60%

All you, Ben, Obama, and everyone else on your side of the fence in between can see as a solution to America's debt crisis is bleeding the rich... hoping to exercise the "evil" festering in their veins.

Why can't you see that government needs to be considerably smaller? What can't you see that a lot of what government has done goes against the constitution of our United States? Why? Because this is a politically ideological issue for you, not a matter of supporting or defending the constitution.You offer benevolence with one hand and a knife in the back with the other.

Obama and every progressive under him desires to set fire to the constitution; sweep it away into the dust bin of history. What you want is to rewrite the rules upon which and by which this nation was founded and successfully governed for more than 200 years. You do not believe in America as it was founded. You believe in an America our constitution does not describe. You're the embodiment of Geppetto... carving out your own vision... hoping to see it come to life. The only problem with that is in order for your vision to live, the original must die.

ELAshley September 29, 2011 at 9:01 AM  

"exercise the "evil" Should read exorcise

BenT - the unbeliever,  September 29, 2011 at 12:32 PM  

Simply a question... how much is enough for the federal government? There doesn't seem to be an answer.

Here's my answer. The US government should have a level of taxation adequate to supply the services the public demands. When the country faces unexpected costs (wars, disasters, recessions) the government should raise additional revenue to cover these costs. The US taxation system should be equitable and just. Equitable in that it does not single out a specific portion of the economy or class of people. And just in that it does not place an overwhelming burden on the poorest and most disadvantaged portion of the nation.

"Why can't you see that government needs to be considerably smaller? "
Why can't you see that our government is already as small and streamlined as it can be?

The US government had fewer personnel in 2010 (4.4million) than it did in 1962 (5.3million). [chart] Any entrepreneur will tell you that personnel costs are the biggest expense for any business.

Republicans have been on a cost cutting meme since 1985 when Grover Norquist began Americans for Tax Reform. How can you think that 20 years of opposition to taxes hasn't caused government agencies to streamline and economize?

Since the 1950's the federal government has taken 15%-20% of GDP in revenue, Yet in that time we've had multiple wars, disasters, recessions, plus the populace has demanded more and more governmental services. The fact is that the government's yearly deficit comes from the fact that there are not enough tax revenues to pay for the basic governmental services that we demand. And the long term debt comes from our unwillingness to accept higher taxes to pay for unexpected expenditures like the Afghanistan/Iraq Wars (cost: $3-Trillion).

So if you believe, as I do, that more revenue is needed to pay off our long-term debt and eliminate the deficit then where in the economy do you look -- the sector of the economy that is showing record profits, and the portion of the population whose incomes continue to grow twice as fast as the rest of the population.

BenT - the unbeliever,  September 29, 2011 at 12:36 PM  

"but to lose 90% of ones earnings in taxes IS evil."
That 90% tax rate was only applied to the income over the $1-million mark.
Today the first $10,000 in income everyone, even millionaires, pays 10% tax on.

For every dollar from $10,001 to $100,000 everyone pays 15% tax.

Then from every dollar a person makes above $100,001 up to $250,000 they pay 25% in tax.

And currently the last tax bracket kicks in a $250,001 at 33%.

Pres Obama's plan would institute a new bracket starting at $1,000,001 at a 37.5% rate.

Under the new plan someone making $5-million in income each year will see their taxes increase from $1,619,500 to $1,803,500. A increase of 3.68% of their yearly income. This is not an unequitable or unjust change to our taxation system.

ELAshley September 29, 2011 at 1:16 PM  

"Why can't you see that our government is already as small and streamlined as it can be?"

This statement perfectly illustrates the divide between Liberal and Conservative ideologies.

But to answer, government is NOT as small and streamlined as it can be. Not by a long shot.

BenT - the unbeliever,  September 29, 2011 at 1:38 PM  

Illustrate, explain or substantiate your claim.

So far all you've presented is a feeling, and the emotional statements of right-wing talking heads.

Marshall Art September 29, 2011 at 1:48 PM  

Ben,

Your last two comments contain some grave errors.

The first is the assumption that what the federal government does should be dictated by the "demands of the people". Why have a Constitution at all? It was designed to dictate the duties of the federal government, not delegate that task to the "demands of the people", particularly when "the people" can be fickle. The federal government and "the people" are supposed to work within the parameters of the Constitution short of any amendments to it.

Thus, for whatever programs instituted by the federal government and still in effect that do not align with its duties as spelled out by the Constitution, there existence proves the federal government isn't streamlined at all. Not even close.

What's more, regardless of whether or not we have fewer government employees now than in times past, if we have those programs in existence, we have too many government employees. Another sign we are not the least bit streamlined. Smaller than before does not equal small as it should be.

Another error is in your description of "unexpected costs". First of all, war is the business of the federal government. By that I mean it is one of the Constitutionally mandated concerns of the federal government and to prepare for war and execute them when they occur should not be something that catches us off guard. It is notable that we tend to find ourselves in war during times of reduced spending on the military. I've read two separate articles that speak to this, one by Victor Davis Hanson. If need be, I'll find it. But the point is that proper expenditures by the federal government in this area does not leave us with our pants down financially.

The other "unexpected costs" are not the fed's problem. Disasters can likely be handled more often by the states in which they occur if the states aren't burdened by the effects of bad federal policies. To what extent is in question because of those policies. And recessions? The government has historically been proven to only exacerbate recessions. Recessions are part of the natural ebb and flow of a free market economy and do not last long without government intervention. Indeed, I believe it was Harding who lowered taxes to successfully relieve the pressure of a recession he faced. Letting the free market work is the best antidote for recessions, not gov't intervention.

All in all, what you and Jim are defending is the demand for more taxes for things that you had no business demanding of the federal government in the first place. That is, you can demand what you want, but the federal government is supposed to be bound by the parameters laid out in the Constitution, barring amendments. So, you can't whine about what you should be getting, and then after getting it, whine about who should pay for it.

Third is equity in taxation. There is no equity or fairness that does not include everyone. This is why a flat tax with no deductions is the definition of tax fairness. Buffet himself has indicated how he pays far more in taxes than his secretary ever will, even if his goofy notion of tax rates is truthful. The key is that the government should not be spending what it can't take in and if the people demand more, they must be refused based on the rate of revenues.

And BTW, we are still within that 15-20% of GDP from what I understand.

BenT - the unbeliever,  September 29, 2011 at 3:11 PM  

What a curious view of government Marshall has.

The founding fathers didn't see a need for an air traffic safety administration so we shouldn't have one. or a security and exchange commission to regulate the financial markets, or a food and drug administration, or an interstate highway system, or a space program, or well anything after the 1800's.

Sure seniors had a poverty rate above 40% in the 1930's and 40's but that was no reason to implement such an unconstitutional system as Social Security.

It's like you completely miss the founding document before the Constitution -- the Declaration of Independence. Governments are responsible to the needs of the governed, and when governments don't represent the people, then the governed have the right to change their political system. Well America has done that over the last 200 years. We have changed our political system so that it continually represents the will of the public. So though those founding fathers may have only seen a need for national defense, today we see a need for national healthcare and education and social security.

"But the point is that proper expenditures by the federal government in this area [war] does not leave us with our pants down financially."

America doesn't have a rainy day war fund, so when we engage in military action it always adds to the national debt. The Afghanistan and Iraq Wars have added $3-Trillion over the last ten years. Plus even with minor conflicts military actions cost.

When you fire a bullet you have to buy a new bullet to replace the one you fired. When you transport troops half way around the globe it costs in machine wear and tear and fuel. Those costs are never recovered.

War is a monstrously expensive undertaking that America has never budgeted for, and in the last decade we haven't even raised taxes to cover these increased costs.

Jim September 29, 2011 at 10:55 PM  

El said, "We know that taxing all the wealthy at 100% will not help in any significant way." I don't know anybody who has suggested that anybody be taxed at 100%. But adding 4.6% will reap billions over 10 years.

"Simply because a majority favors a thing, it doesn't make that thing right. "

Using that same argument on Health Care, El?

"I believe you are mistaken about capital gains taxes. The shareholders are owners of the company who receive their cut of the already taxed profits of that company and then are taxed again."

Marshall, you are the one who is mistaken. You apparently don't know the difference between dividends and capital gains, fairly elementary concepts in finance. While there IS an argument to be made that taxing dividends is double taxation, the same is NOT the case for capital gains.

If I buy 100 shares of XYZ with my already-taxed money for $10,000 and sell it for $12,000, my $2,000 capital gain has not been previously taxed. The $2,000 is income and should be subject to tax.

"how much is enough for the federal government? There doesn't seem to be an answer."

The answer is enough to stop having deficits. That can't be done through cuts alone. You can't simply cut the budget by 40% (remember, we borrow 40 cents out of every dollar we spend).

"90% of ones total earnings forfeited in taxes."

I wish you folks would stop saying things that prove without a doubt that you don't know what you're talking about (see capital gains, above). No wonder you think taxation is thievery.

Ben has never suggested that this country has taxed anybody 90% of their income and this country has NEVER done so. Are you at all familiar with the concept of "marginal tax rates"?

"Depending upon which state a "rich" wage earner lives, he's already paying upwards of 50% in total tax liability [emphasis added]."

Again proof that you don't know what you are talking about. Please show me the tax return of anybody who is paying 50% of total income in taxes.

"All you, Ben, Obama, and everyone else on your side of the fence in between can see as a solution to America's debt crisis is bleeding the rich"

Another straw man. I'll let Ben speak for himself, but I imagine that he would agree with me that raising the marginal tax rate of the wealthiest is only a part, and not the largest part, of finding a solution. Getting out of Iraq, Afghanistan, and a lot of other countries would help, restructuring the tax code could help. Finding efficiencies in government could help. But most importantly, getting people to work so they can add to the tax base is maybe the biggest part of the solution.

To be continued....

ELAshley September 30, 2011 at 8:20 AM  

"El said,"

No... actually, Jim, it was Marshall who said that.

Jim September 30, 2011 at 8:58 PM  

Yep, got mixed up. Had Marshall then changed it. I think it was the terrible "echo" on this page. :-)

Marshall Art October 2, 2011 at 10:07 PM  

"It's like you completely miss the founding document before the Constitution -- the Declaration of Independence. Governments are responsible to the needs of the governed, and when governments don't represent the people, then the governed have the right to change their political system."

I didn't miss a thing, Ben. The Constitution dictates the limitations of how and when the federal government meets those needs. It defines what needs the federal government will address and if the people feel the government needs to go beyond the dictates of the Constitution, then there is an amendment process for that purpose. Indeed, the very Declaration to which you refer states

"Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes;"

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