The Smartest Guy in the Room Speaks

Off Topic Politics & World Issues
41

[quote]swoleupinya wrote:

[quote]ZEB wrote:

[quote]swoleupinya wrote:

Obama and the democratic leadership are advocating for additional tax cuts to those earning under $250k and an expiration of the Bush tax cuts… although, they seem to have caved early to pressure from the republicans last year and their fallback position was to extend (allow to continue) the Bush tax cuts to those earning under $250k and allow all of the other elements of the Bush tax cuts to expire.

[/quote]

Yes by all means let’s cut taxes for those who contribute least to the economy and take more from those who contribute most. If the democrats ever tried to run a business that way they’d be bankrupt quickly and only partially because they’d have to pay their own heinous tax rates.

All politics aside how does it ever help to punish those who are responsible for creating jobs. I just wish that question could be answered clearly ONE TIME by someone advocating higher taxes on small business people.

[/quote]

Zeb,

According to the IRS, 2% to 3% of businesses who file as an S-corp or an LLC declare over $250,000 in taxable income. Considering that small businesses account for somewhere between 75% and 85% of jobs in the US, I think you’re argument here is baseless.

I’m getting ready for a long drive for a family Thanksgiving trip, so I don’t have a ton of time to research… I do remember a recent report/survey/research piece that came out showing that the percent of spending predicted (via past trends) out of a tax break rises as income declines… with a sharp drop off above $300,000 in earnings… what this means is that when you give tax break to people with lots of money, they are a lot less likely to spend it than if you gave the break to someone with less money.

Imagine that.

Also, you should consider the possibility that as someone’s capital holdings increase, the value of each dollar they hold increases. For example, if I have ten dollars, and someone else has 200 dollars, each 10 dollars that they have is worth more in the aggregate… capital leverage. Not only that, but as someone’s capital holdings increase so does their dependency on the common wealth (roads, postal, military, etc…). This is one of the founding principles of the progressive tax.

If you introduce a flat tax, you are essentially multiplying the leveraged value of dollars as capital holdings increase, in a manner that does not reflect fairly on reliance on the common wealth. [/quote]

  1. Putting money in a bank or investment (not spending) isn’t the same as putting it under a mattress like you were implying. People putting money in the bank is an important part of the economy. Probably more important that supporting Cheetos and fast food with that money.

  2. A flat tax causes people to pay more in tax as they earn more. Besides, if this were about taxes reflecting use of the system, people who rely on social programs should be taxed more. So, until you are for increasing taxes on the jobless and such, you can take your pseudo “not fair” and shove it up the ass your talking out of. Because the truth is that you don’t care in the slightest about the fairness of taxation essentially by definition.

  3. To further extend on this point, if you honestly believed in taxation being based on usage, every use of public service would be taxed. You would pay a tax for each use of the library or when you visited the park. That would be taxation based on usage in the ultimately only fair way. And that would be nothing more than a capitalist system. So once again, as soon as you start crying about “not fair” I’m forced to laugh at you. Taxation and public use is for the expressed purpose of not having a system based on usage.

  4. In the last paragraph you have reduced your argument to using taxation to make the disparity between what you make and the people you are jealous of “more fair”. I’d just like to point out that this essentially abandons the notion of what works best, what makes the economy work, what is right and wrong, and instead is only a attempt to justify the use of violence to take other people’s earnings so it’s easier economically for you.

  5. Next, your notion that the wealthier a person gets the less likely they are to use the money is directly in opposition to the notion that the wealthier a person gets the more they use the public systems. Which is it? You are wrong about one of those two which forces me to question if you have any idea what you are talking about.

You, like most liberals, have equated not taking money from people to proactive action by the government. In that sentence you have conveyed the notion that production first belongs to the government. And further that individuals receive property rights from said government.

This is one of the biggest problems I have with the news these days. When they say “tax cuts will cost us x amount”. That is 100% fundamentally flawed. It is assuming that money is the governments and what you have is what they allow you to keep. This is the exact polar opposite of the notion of freedom, liberty, and natural rights this country was founded on. People have rights and they allow the government certain things. Period. NOT the other way around.

By the very structure of your wording it is obvious you miss the whole point of being American.

42

[quote]DoubleDuce wrote:

  1. Putting money in a bank or investment (not spending) isn’t the same as putting it under a mattress like you were implying. People putting money in the bank is an important part of the economy. Probably more important that supporting Cheetos and fast food with that money. [/quote]

Considering the stagnation in the credit market, right now it’s considerably less important.

You have no idea what I care about, and you would be better served arguing the issues instead of what you might perceive to be my motivations. You could also tone down the language a bit.

To your actual point here, reconsider the leveraging affect of capital accumulation.

Nobody is “crying” here. In fact, the only one of us bringing an excessive amount of emotion to the table is you.

As a citizen of the US, I own a portion of the common wealth equal to one share, where everyone who is a citizen has one share. I expect that my share will be equally represented by the arbiter of the common wealth (the government) and acceptable use of that common wealth be given freely and equally to all who own a share of it. The fact is, though, that as your capital increases, your impact on the common wealth increases in a disproportionate ratchet. Hence, the progressive tax. Most civilized countries have recognized this affect.

Seriously… are you even reading what I write? What you are doing here is attributing all sorts of assertions and motivations to me that I have not represented. It’s called a straw man argument.

You are thinking in terms of a one-to-one ratio. As I noted above, we are talking about a ratchet affect here. I don’t know that there is any precise way of nailing down which is more important, capital investment (broad use of the term here) or consumer spending. However, I don’t think it’s unreasonable to look at the last twenty-five years of tax policy, which has largely seen an erosion of the progressive tax, and question the usefulness of the “trickle-down” concept.

Trickle-down seems to work when there is a robust and directed lending market. When liquidity is an issue, though, it falters… and dramatically. The last ten years have born this out.

[quote] You, like most liberals, have equated not taking money from people to proactive action by the government. In that sentence you have conveyed the notion that production first belongs to the government. And further that individuals receive property rights from said government.

This is one of the biggest problems I have with the news these days. When they say “tax cuts will cost us x amount”. That is 100% fundamentally flawed. It is assuming that money is the governments and what you have is what they allow you to keep. This is the exact polar opposite of the notion of freedom, liberty, and natural rights this country was founded on. People have rights and they allow the government certain things. Period. NOT the other way around.

By the very structure of your wording it is obvious you miss the whole point of being American.[/quote]

Again, a straw man argument.

You are not arguing with me, here. You are arguing with what you imagine I might be.

43

[quote]Zeb,

According to the IRS, 2% to 3% of businesses who file as an S-corp or an LLC declare over $250,000 in taxable income. Considering that small businesses account for somewhere between 75% and 85% of jobs in the US, I think you’re argument here is baseless.[/quote]

I have no idea where you gleaned those facts but they are not accurate. About half of small-business owners with 20-249 employees earned more than 250-k in 2007 according to the small business administration. That means that those people will be punished along with everyone else if Obama and the democrats get their way. You can’t be for this you are a logical individual.

I wish you a safe trip and a Happy Thanksgiving :slight_smile:

I’ve not read this information but it would come as no surprise to me. There are various ways to stimulate the economy. Tax breaks are the best. If those making less money decide to spend it then that creates jobs indirectly as more people are needed to sell them goods and services. But there is another way to create jobs and that is what higher income people do. While they may spend less they invest more. And when you invest you are creating wealth. If wealthy person “A” gets to keep 200-K of his money and decides to open an additional store to his already 4 store chain then that means he will hire 5 more employees. Those employees were either unemployed before, or they worked at lesser paying jobs. Either way they win. He now has an additional store, so he wins. The consumers in that new market he has entered win as they now have an additional choice and will probably pay less for that product as competition drives prices down. And don’t forget the effect of those 5 employees spending more of their money as you say those making under 300-k do.

Everyone wins: the consumer, the business person, the economy, the employees. The government even wins as the tax base is broadened. No one wins when the government is allowed to take more money. They have proven themselves very poor at managing large sums of cash - they waste it - but you know that already everyone does.

Yeah imagine that. A smaller government with more people employed.

That is patently unfair - You’ve included what they use and rationalized a tax hike on them, but you’ve not included what they actually give which negates any usage. As my example above clearly points out. If someone owns a small business that employs 30 people he/she is giving far more than they are taking. This makes the progressive tax system a very bad joke on those who actually produce something. A flat tax IS the only fair way to tax. With an exception for the lowest paid. And all loopholes are closed, tightly.

44

[quote]ZEB wrote:

That is patently unfair - You’ve included what they use and rationalized a tax hike on them, but you’ve not included what they actually give which negates any usage. As my example above clearly points out. If someone owns a small business that employs 30 people he/she is giving far more than they are taking. This makes the progressive tax system a very bad joke on those who actually produce something. A flat tax IS the only fair way to tax. With an exception for the lowest paid. And all loopholes are closed, tightly.

[/quote]

My last post tonight, because I really have a lot of shit to get done!

No, this calculation DOES include what they give… we’re talking about taxable income here, and it excludes payroll, investment back into the business, charitable giving, etc… We’re talking about the net value of their earnings.

You may find this unbelievable, since a few people including yourself have taken my position and extrapolated it into all sorts of other areas, but I used to be a flat-tax proponent. I was young and making a shit-ton of money… long story. The CEO of the company that I worked for at the time (a big-time Wall Street guy, Michael Liss) explained the above concept of the progressive leverage of accumulated capital.

45

[quote]swoleupinya wrote:

[quote]ZEB wrote:

That is patently unfair - You’ve included what they use and rationalized a tax hike on them, but you’ve not included what they actually give which negates any usage. As my example above clearly points out. If someone owns a small business that employs 30 people he/she is giving far more than they are taking. This makes the progressive tax system a very bad joke on those who actually produce something. A flat tax IS the only fair way to tax. With an exception for the lowest paid. And all loopholes are closed, tightly.

[/quote]

My last post tonight, because I really have a lot of shit to get done!

No, this calculation DOES include what they give… we’re talking about taxable income here, and it excludes payroll, investment back into the business, charitable giving, etc… We’re talking about the net value of their earnings.[/quote]

Exactly and that makes no sense. They give more to society and the economy directly and because of that gift the government says “give more”. How is that even remotely fair? And on the other end of the spectrum we have a large growing group of people who pay nothing and are a drag on both society and the economy. They are rewarded for this by taking from those who have contributed. Is there any wonder this economy is on the fritz?

I don’t think that I’ve done this. I’ve been very careful to respond to only what you’ve written.

[quote]but I used to be a flat-tax proponent. I was young and making a shit-ton of money… long story. The CEO of the company that I worked for at the time (a big-time Wall Street guy, Michael Liss) explained the above concept of the progressive leverage of accumulated capital.
[/quote]

What’s interesting is that you’ve described a perfect example of what I was talking about on another thread. People make up their beliefs based upon what will either hurt or help them personally. If you were still making tons of cash you would once again feel that a flat tax is the best way to go - Excellent example, thank you.

Happy Thanksgiving!

46

swole:
i am on my phone and cannot quote the post.

  1. a temporary condition that is a terrible thing to base law as permenant as istitution of a progressive tax.

2-3) i assumed nothing about what you care about. i merely took a claim you made to its logical end to note your hypocricy. you wanted to taxe the rich more for disprotportionate use of the system while reducing tax on poor whom also use a disproportionate amount of the system.

capital investment always leads to an increase in taxation. it may just be indirect. but this point is mute because your initial condition that using the system more justifies an increase in taxation is invalid.

  1. No i assumed nothing. just noted that this whole part of the argment revolved around what you deemed a fair distribution of wealth. there was no other basis for this part of your argument.

lastly, no i assumed nothing. i just noted the necessary viewpoint of your argument. you label government letting people keep money as a pro-active step. that may sound like i am arguing semantics but the truth is that the perspective of that statement shows a fundamental devide in our basic understanding of what government is and is not.

47

also, a flat tax RATE is a progressive tax. you just dont think it is progressive enough.

48

Swole, you are right, as a citizen you have are one unit whose rights need to be protected. That does not give you or any other number of units the right to steal other peoples life, to give to someone you think deserves it. By taxing and giving entitlement programs you are stealing someone’s life, they gave part of their life to EARN that income, and you are taking it away FORCEBLY, to give part of it to some group deemed entitled. WITHOUT just compensation to the person you took it from. The 5th ammendment states:

“No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation”

Lets for now focus on “nor shall private property be taken for public use, without just compensation”, All entitlement programs are a direct violation of this. Taken from one to give to another is not just compensation.

Maybe you should read the consititution and the amendments. Start there and understand what the country was founded on.

49

Let me add one more thing. Who in their right mind thinks it is smart to tax a business? Who would think it is smart to tax their employer? That is just begging to have people fired.

Tax consumption and watch jobs come back. Then watch tax revenue increase.

These liberals who care about the poor really don’t seem to care about my job. If my employer’s tax goes up they will be forced to cut people. Quit putting my job on the line, I can not afford to be unemployed and I really doubt you want to pay for me.

p.s. Right now while going to school I am working at wal-mart. It is not a good job but it is the only job around and let me tell you if you do favor raising taxes on the rich my job will be on the chopping block. This isn’t some academic exercise this is real life and people will get fucked over if you raise taxes. You may think it is wrong but that is how the world works.

p.s.s. If this administration has such a hard on for tax increases why not just raise all our taxes by 1%, that should offest the costs till we get a real president in their to do some spending cuts.

50

[quote]John S. wrote:
Let me add one more thing. Who in their right mind thinks it is smart to tax a business? Who would think it is smart to tax their employer? That is just begging to have people fired.

Tax consumption and watch jobs come back. Then watch tax revenue increase.

These liberals who care about the poor really don’t seem to care about my job. If my employer’s tax goes up they will be forced to cut people. Quit putting my job on the line, I can not afford to be unemployed and I really doubt you want to pay for me.

p.s. Right now while going to school I am working at wal-mart. It is not a good job but it is the only job around and let me tell you if you do favor raising taxes on the rich my job will be on the chopping block. This isn’t some academic exercise this is real life and people will get fucked over if you raise taxes. You may think it is wrong but that is how the world works.

p.s.s. If this administration has such a hard on for tax increases why not just raise all our taxes by 1%, that should offest the costs till we get a real president in their to do some spending cuts.[/quote]

John,

Good post for the most part, however I don’t agree with a consumption tax, however it would be better than the over taxation that we now have. One more point Obama and his cronies would never raise taxes across the board by 1% that fly’s in the face of the class warfare that the democrats have waged for the past 40 years or so. If do not demonize thr rich then they risk losing the vote of all the people who resent those of us who have actually made a buck. So they have to keep that going.

51

The only really truly efficient and “equitable” tax is a lump sum tax where everyone pays the exact same amount, regardless of income.

52

Buffet = great businessman, shitty macroeconomist

53

The tax dollars have to come from somewhere, gripe about big Government all you want, the bottom line is no party that takes the axe to the ‘Big Three’ is going to get re-elected.