Sassenach wrote:Well now that you've gotten that little rant off your chest perhaps you'd like to come out with some concrete figures to illustrate precisely where you'd weild the axe and how much money it would save. So far you've ranted and raved about Planned Parenthood, which accounts for a tiny trickle of funding, so where else would you find the money ? What cuts would you make to Social Security to bring it back into balance ? how much would you trim from medicare ? how many armoured divisions and aircraft carriers would you put into mothballs ? how far would you extend the state retirement age ? exactly how many people would you make redundant ? If you're not willing to answer these questions and show how you plan to make the necessary savings from the big ticket expenditure items then all you're doing is engaging in bluster and bullshit. So what's it to be ?

I don't think you're going to be able to answer those questions in a way that manages to cut enough spending to bring the books back into balance. Or rather, I don't think you can come up with a plan that's even remotely feasible electorally. I also don't think you're unaware of this problem, which is why you concentrate on vagueness, trivialities and irrelevant folksy metaphors.

And, what taxes would YOU raise to balance things? Please understand we have a current deficit of $1.6T, so you better get cracking!

Well I think you'd have to look at a repeal of the Bush tax cuts, certainly for the upper end but also partially or maybe even fully for middle earners too since upper end taxes wouldn't be enough. Re-introduction of an inheritance tax would have to be looked at as well. But I never said I'd make up the shortfall solely through taxation, you just keep pretending that I did for some reason. What I said was that since cutting taxes has contributed so much to the deficit raising them again would have to be part of the mix for a sensible deficit reduction plan.

I'd also look to make substantial cuts in spending. Agricultural subsidies would be a good place to start since not only are they an egregious waste of money they're also the major stumbling block in international trade negotiations. The benefits of drastically slashing them could be enormous (except for politicians in farmers districts of course....). You currently spend more money on national defence than the rest of the world put together so you'd have to think that a lot of money could be trimmed here too. I'd probably arrive at a figure and then leave it to the generals to prioritise which areas to cut, but certainly you could shave a good 20% without any major hardships, and the same probably applies to most major spending departments, although I don't think it's wise to have an arbitrary target that applies to all of them equally. But the biggie of course is entitlement programs. I don't know enough about them to come up with a coherent plan out of thin air but obviously some pretty drastic structural reforms are required to drive down long term costs, which may include some form of means testing but could also require all kinds of other reforms.

Like I said, I'm not opposed to spending cuts by any means, neither am I saying that entitlements don't need to be looked at. But it'seasy for me to say these things because, as Randy rightly points out, I'm not American and so I don't have to either pay the taxes or suffer the effects of the reductions to my entitlements. Nor do I have to stand for election on such a platform. From what I'm seeing, those who do have to stand for election in America seem to be pretending that you can balance the budget without touching either taxes, the military or the major entitlement programs. This is clearly bonkers and I can't see how they can perpetuate the fantasy for long.

Oh, and one final point Steve, the cuts you just proposed wouldn't amount to anywhere near $1.6 trillion. Some of them aren't even cuts at all really. Abolishing the Dept of Education would save money for the federal govt but at the expense of passing on the costs to the states, which would then have to be raised through higher local taxes or borrowing. That is, it would unless you plan to seriously undermine the whole concept of public schools and leave education as a preserve of the affluent, which wouldn't play too well with the voters. Ending the war in Afghanistan would save money for sure, but it sill wouldn't really touch the sides of the enormous black hole into which you pour all your national security dollars. Ending corn subsidies is a great idea but it doesn't go anywhere near as far as my proposal to drastically cut or maybe even scrap all farm subsidies (not that my idea has a cat in Hell's chance of ever passing Congress). UN funding is a drop in the ocean. So where would you find the rest of the money ?

Randy scares me. I could go line-by-line on his rant, but I'm afraid he'd find out where I live, but Steve, "Lower taxes do not result in lower revenue." I know this has become a Republican mantra, but come on. Think about sales tax, if you lower the sales tax rate from 6% to 3%, do you think that revenue won't go lower? Don't you think that the lowering of the payroll tax this year and next from 12.4% to 10.4% has lowered payroll tax collections?

I imagine the people who truly benefit from this sort of misinformation look down at the Republican rank and file with a bemused smile. They nudge their buddies and say, "can you believe they actually believe this BS?" I could make analogies to feudal lords, serfs and the catholic church, but instead I'll say that this mantra is something you accept as a Republican true-believer, and it is simply an issue of faith: you may not be able to prove it, but that doesn't make it not true to you. I get it. But please forgive the non-believers, but men of reason require proof (and mathematical reason).

Sassenach wrote:Well I think you'd have to look at a repeal of the Bush tax cuts, certainly for the upper end but also partially or maybe even fully for middle earners too since upper end taxes wouldn't be enough. Re-introduction of an inheritance tax would have to be looked at as well. But I never said I'd make up the shortfall solely through taxation, you just keep pretending that I did for some reason. What I said was that since cutting taxes has contributed so much to the deficit raising them again would have to be part of the mix for a sensible deficit reduction plan.

Raise your own taxes. None of the things you propose would affect me and yet I oppose them. Why? Because I don't believe taxes are too low. I believe our government wastes too much money. What I know and cannot be refuted is that Obama has spent more money than any President in history and has shown zero interest in cutting spending. All he wants is to raise spending and raise taxes.

You currently spend more money on national defence than the rest of the world put together so you'd have to think that a lot of money could be trimmed here too. I'd probably arrive at a figure and then leave it to the generals to prioritise which areas to cut, but certainly you could shave a good 20% without any major hardships, and the same probably applies to most major spending departments, although I don't think it's wise to have an arbitrary target that applies to all of them equally.

I've said I have no problem cutting bases. i would also be quite happy to not police the world, unlike our current President. I would refine our defense contracting parameters. I have inside info that the process is a complete wreck. The way we do this is insane.

That said, we have to not over cut on defense. Nature abhors a vacuum. If we step back, someone will step up--and they will not be so close to benign as we are. History tells us that.

From what I'm seeing, those who do have to stand for election in America seem to be pretending that you can balance the budget without touching either taxes, the military or the major entitlement programs. This is clearly bonkers and I can't see how they can perpetuate the fantasy for long.

You didn't read Ryan's proposal, clearly. He begins the process of touching "the third rail" by going after Medicare. Today, three GOP Senators (Lee, Paul, and Graham) announce a proposal for Social Security reform--means testing, raising retirement age, etc. Meanwhile, Democrats keep proposing . . . more spending!

Oh, and one final point Steve, the cuts you just proposed wouldn't amount to anywhere near $1.6 trillion. Some of them aren't even cuts at all really. Abolishing the Dept of Education would save money for the federal govt but at the expense of passing on the costs to the states, which would then have to be raised through higher local taxes or borrowing.

Oh, I'd get to $1.6T, trust me. And, abolishing the Education Department would be a cut. I would end many of the programs it oversees and all of those federal employees would be gone. That's real money. The States would have choices to make. Spending on education has increased greater than inflation and what do we have to show for it over the last 40 years?

Ending the war in Afghanistan would save money for sure, but it sill wouldn't really touch the sides of the enormous black hole into which you pour all your national security dollars.

Money is money. If we save x billions in Afghanistan, Iraq, and Libya, that is money saved. Period.

Ending corn subsidies is a great idea but it doesn't go anywhere near as far as my proposal to drastically cut or maybe even scrap all farm subsidies (not that my idea has a cat in Hell's chance of ever passing Congress). UN funding is a drop in the ocean. So where would you find the rest of the money ?

Get enough "drops" to get to a balanced budget. I would cut Amtrak, privatize any museums or entities (think USPS) that lose money, and keep on cutting until I balanced the budget.

geojanes wrote:. . . but Steve, "Lower taxes do not result in lower revenue." I know this has become a Republican mantra, but come on. Think about sales tax, if you lower the sales tax rate from 6% to 3%, do you think that revenue won't go lower? Don't you think that the lowering of the payroll tax this year and next from 12.4% to 10.4% has lowered payroll tax collections?

Let's talk about sales tax. If you raise it from 5% to 6.25% does it raise 25% more revenue?

I doubt it. That's what our state did. What is the result? People buy more stuff in NH, where there is no sales tax. In fact, our governor has asked NH to collect the tax for MA.

When you raise your sales tax, you encourage bartering, buying off the Internet, and traveling out of state to make big purchases. When you lower sales taxes, you encourage people to "buy local." Here's a real-life example of the "brilliance" of raising taxes:

After two-months of fence-sitting, Illinois Governor Pat Quinn today signed controversial legislation requiring Internet retailers like Amazon.com and Overstock.com to collect Illinois’ 6.25% sales tax if they have affiliate sellers in the state. House Bill 3659, the Mainstreet Fairness Bill, was passed by the state’s lame duck legislature in early January. Since then, the bill has been the subject of fierce lobbying by traditional bricks and mortar retailers, who supported it, and Illinois-based Internet-only businesses, who warned that if Quinn didn’t veto it some of them would flee the state. Had Quinn done nothing, the bill would have become law tomorrow without his signature.

Amazon has already said it will terminate its Illinois affiliates, just as it has said it will drop 10,000 California based “associates” if similar legislation pending in that state becomes law. Affiliates are paid a fee by Amazon and other retailers for sales brought in through advertisements and links on the affiliates’ web sites. In an escalating PR war, Wal-Mart, Sears, Best Buy and Barnes & Noble have all issued public invitations to Amazon’s spurned associates to join their affiliate marketing programs instead. Yesterday, the Alliance for Main Street Fairness, a bricks and mortar retailers organization, even announced a new web site to connect affiliates “about to get thrown under the bus” by online-only sellers with retailers who already collect sales taxes on line. Quinn’s office said today that the affiliate matchmaking service had been launched at his request.

In a statement, Scott Kluth, founder and CEO of Chicago-based CouponCabin.com called the Governor’s approval of the bill “deeply disappointing” and said he is “actively exploring” moving his seven year-old business to Indiana. Kluth, a long time resident of Chicago, had previously threatened such a move, telling Forbes, “I can see Indiana from the roof of our business.”

Will it help Illinois or reduce jobs? I'll take the latter position.

I imagine the people who truly benefit from this sort of misinformation look down at the Republican rank and file with a bemused smile. They nudge their buddies and say, "can you believe they actually believe this BS?"

Yeah, but people who believe the government is an independent entity that benignly grants money that it creates to those who cannot or will not earn their own are brilliant.

Let's play dueling caricatures.

How many poor people hire employees? How many poor people sign paychecks? Taxing the rich until they are not rich is no answer. Encouraging hard work is.

I could make analogies to feudal lords, serfs and the catholic church, but instead I'll say that this mantra is something you accept as a Republican true-believer, and it is simply an issue of faith: you may not be able to prove it, but that doesn't make it not true to you. I get it. But please forgive the non-believers, but men of reason require proof (and mathematical reason).

I'm sure you plan to introduce "men of reason." I look forward to it. Your progressive, spread the wealth and all will benefit is the myth and I'm sure you do not intend anyone to believe it is "reason."

Steve, you are just plain wrong to assert as bald fact that cutting taxes does not reduce revenue. The reality is that sometimes it will increase revenue, and sometimes it will not. Dogma is not helpful.

In the early 2000s, the Bush tax cuts did not see revenue go up, but fall. So if you accept the idea of the Laffer Curve, what does that suggest?

In the USA, the rich are getting much richer already. Some create jobs for others, some are just rentiers. Some spend money, but sometimes they spend it on flashy foreign items which doesn't help the economy much. even if marginal rates were higher it's not a massive disincentive to work - If you are on $1M and you go up to $2M, your take-home will still be very high at a 35% marginal rate.

Besides, what are the things that enable the rich who are productive to be so. An education system to produce people able to be employed. Regulatory systems to protect their business. Legal systems and law enforcement to help protect their property. Transport networks to enable trade. etc etc etc. They gain a lot from the system, even if they don't do so directly in all cases.

Steve, of course there is not a one for one relationship to rate and income because taxes impact behavior, but, within reason, increases will raise revenue, decreases will decrease revenue. Deep down, Republicans know this, but the rank and file chose to believe something else based on their faith in the ideology.

Regarding your example Illinois example, I'm not sure of its relevance. Taxes are a cost of doing business and costs of doing business do impact employment. Again, its not a simple formula, but there is an impact that is complicated and non-linear.

How many poor people hire employees? How many poor people sign paychecks? Taxing the rich until they are not rich is no answer. Encouraging hard work is.

This part, however is so messed up, it's hard for me to keep my lid on. First, the richest of us pay some of the lowest tax rates. So how about taxing the rich until they pay as much as the average working man? Give him credit, Warren Buffet disclosed the 17.7% net federal rate he paid in 2007, which is pretty freaking low when you consider at the time he was the richest person in America, and much less than what his secretary paid. In fact, our tax system encourages rich people NOT to work. When work is taxed at 35% (more with payroll taxes) and dividends and capital gains are taxed at 15%, what are we thinking? Work is the good thing, not sitting on your ass collecting a check! Come on Steve, you're with me on that. Finally, a lot of employers are poor. They are called small business people who pour everything they have into their work and their business and risk it all on a dream. Happens all the time and it's pretty awesome. The US system of taxation and the cozy confines of corporate America abuses these people in favor for the likes of Warren Buffett, Jamie Dimon, Bill Gates, and tens of thousands unnamed hedge fund managers, who employ very few and produce even less.

Even though the whiff of class warfare in this discussion makes you uncomfortable, at a fundamental level, Steve, I think you and I agree. Reward work, have people pay their fair share. Who can argue with that? But when you relate those principles to reality, it's like we're living in two different worlds, your up is down, your black is white. And while I'm surprised, I shouldn't be. This is the difference between faith and reason. The difference between ideology and reality. In my mind you and the Republican rank and file are stuck with this faith in a ideology that promises to get the country to a better place for all, but only creates a better place for the chosen few, and it's a tragedy that long-term hurts all of us.

Mention of Buffet by George, and of my wanting to wage 'class war' earlier on reminds me of what Warren said on the matter:

“There’s class warfare, all right,” Mr. Buffett said, “but it’s my class, the rich class, that’s making war, and we’re winning.”

http://www.nytimes.com/2006/11/26/busin ... .html?_r=1

And as is true in so many wars, the people fighting them, people like Steve, don't personally see any of the benefits of the struggle.

danivon wrote:Steve, you are just plain wrong to assert as bald fact that cutting taxes does not reduce revenue. The reality is that sometimes it will increase revenue, and sometimes it will not. Dogma is not helpful.

In the early 2000s, the Bush tax cuts did not see revenue go up, but fall. So if you accept the idea of the Laffer Curve, what does that suggest?

Nothing.

As I've said we had a recession at the end of Clinton/beginning of Bush, and then we had 9/11. Revenues take a hit when the economy goes down. And, in fact, one of the problems with "soak the rich" is that their incomes are not as steady as the non-rich. They take risks. They succeed and fail. They stop risking and live off savings.

Cutting taxes can reduce revenue. Raising taxes can reduce revenue. Cutting taxes can increase revenue. Raising taxes can increase revenue. Happy?

Besides, what are the things that enable the rich who are productive to be so. An education system to produce people able to be employed.

They should get a refund based on the public education system.

Regulatory systems to protect their business. Legal systems and law enforcement to help protect their property. Transport networks to enable trade. etc etc etc. They gain a lot from the system, even if they don't do so directly in all cases.

And, the higher you raise taxes, the more diligent they will be to shelter their income. Tax reform is what we need, but, of course, that would mean resisting the lobbyists.

geojanes wrote:Steve, of course there is not a one for one relationship to rate and income because taxes impact behavior, but, within reason, increases will raise revenue, decreases will decrease revenue. Deep down, Republicans know this, but the rank and file chose to believe something else based on their faith in the ideology.

Caricature.

Here's what we know:

1. Zero taxation means anarchy.

2. 100% taxation means less productivity.

3. Somewhere between the two is the ideal.

4. The two parties ought to never agree on where that is. Why? Because then, as Pelosi said, elections don't matter.

5. Liberals and progressives believe the government spends money more wisely than those who earn it. They also believe the government is generally trustworthy.

6. Conservatives believe the government wastes money more than it spends it efficiently. They believe those who earn it have first claim on it, not the government. They are inherently mistrustful of government.

Regarding your example Illinois example, I'm not sure of its relevance. Taxes are a cost of doing business and costs of doing business do impact employment. Again, its not a simple formula, but there is an impact that is complicated and non-linear.

Because the morons, er, Democrats in Illinois presumed that Amazon was bluffing and that this would be a revenue enhancement. It wound up costing jobs and revenue. When you raise taxes, people move to avoid them. Thus has it ever been. That does not mean you should never raise taxes. It means it should not be the knee-jerk response to balance the budget.

How many poor people hire employees? How many poor people sign paychecks? Taxing the rich until they are not rich is no answer. Encouraging hard work is.

This part, however is so messed up, it's hard for me to keep my lid on. First, the richest of us pay some of the lowest tax rates. So how about taxing the rich until they pay as much as the average working man?

Try it. They will just go GE on you (you know, the company led by Barack's pal, Immelt, that makes billions and pays zero taxes).

Give him credit, Warren Buffet disclosed the 17.7% net federal rate he paid in 2007, which is pretty freaking low when you consider at the time he was the richest person in America, and much less than what his secretary paid. In fact, our tax system encourages rich people NOT to work.

I give Buffet zero credit. Nothing stops him from giving to the government. Bust out the checkbook, Warren and put a sock in your yap. Show me you want to pay more! What he wants is to FORCE others to pay more.

When work is taxed at 35% (more with payroll taxes) and dividends and capital gains are taxed at 15%, what are we thinking? Work is the good thing, not sitting on your ass collecting a check! Come on Steve, you're with me on that. Finally, a lot of employers are poor. They are called small business people who pour everything they have into their work and their business and risk it all on a dream. Happens all the time and it's pretty awesome.

Many of these people are the ones Obama is targeting. Oh, sorry. Didn't mean to use militaristic language.

The fact is that 47% of Americans pay zero income tax. None. The "payroll tax" is the only "tax" I know of that will pay most people more than they pay in.

Even though the whiff of class warfare in this discussion makes you uncomfortable, at a fundamental level, Steve, I think you and I agree. Reward work, have people pay their fair share. Who can argue with that? But when you relate those principles to reality, it's like we're living in two different worlds, your up is down, your black is white. And while I'm surprised, I shouldn't be. This is the difference between faith and reason.

Right. You have faith in government.

With reason, I understand it can't be trusted.

What is the objective of government? I say it is to stay out of the way, but be big enough to stop us from killing each other and protect our national borders. The federal government does a lot of things it was never designed or intended to do. This is where we disagree.

i also don't begrudge wealthy people their money. My suggestion to you and other left-leaning folks would be to go for a "wealth tax." It would force people to use their money or lose it.

My guess? They would send it overseas--just like they will if we start jacking up the individual rates.

Part of the problem is that you live in a city that is predicated upon the principle that your money is their money. NYC blesses people with the opportunity to live there. The poor get all kinds of help. Everyone else gets all kinds of taxes.

In my mind you and the Republican rank and file are stuck with this faith in a ideology that promises to get the country to a better place for all, but only creates a better place for the chosen few, and it's a tragedy that long-term hurts all of us.

I'm not rich and I'm not hurt. What "hurts" is the clown in the White House who is spending money that my great-grandchildren will be paying back and dragging the US through the mud across the globe. His vision is to "redistribute the wealth." That's sure helping the economy and the country, isn't it?

geojanes wrote:And as is true in so many wars, the people fighting them, people like Steve, don't personally see any of the benefits of the struggle.

Because I believe that by spending less than I make, saving, and planning for the future, I can "win." I know, I know, it's crazy. I should just wait on the government to take care of me.

geojanes wrote:So how about taxing the rich until they pay as much as the average working man?

A great reason for the "flat tax". Three tiers, no deductions for anyone.

10% - up to 50K
15% - 50K to 150K
25% - 150K and up.

This would reduce the IRS considerably (and a savings along with it!), and bring in that revenue much more equitably with the "working man" the George mentions. This would simplify the tax system as well. No more difficult hassles concerning the impending 15APR deadline. Just think, you make 100K throughout the year, and you pay your payment based upon your income. The tax deadline comes around, and you verify your income and your taxes paid. It could be done on 1 page!

I'm in... Who is with me?

Doctor Fate wrote:

danivon wrote:In the early 2000s, the Bush tax cuts did not see revenue go up, but fall. So if you accept the idea of the Laffer Curve, what does that suggest?

Nothing.

As I've said we had a recession at the end of Clinton/beginning of Bush, and then we had 9/11.

And the effects of those hit tax revenues for nearly a decade afterwards? I think that's unlikely.

More likely is that you have moved along the curve to the point where reducing taxes will reduce income (and increasing them may either keep it steady or increase it). At the very least you can't make assumptions the other way, you'd be better off getting some evidence.

(by the way, evidence is not the same as repeating your opinions)

Revenues take a hit when the economy goes down. And, in fact, one of the problems with "soak the rich" is that their incomes are not as steady as the non-rich. They take risks. They succeed and fail. They stop risking and live off savings.

Hmm. I've known several 'non-rich' people with very unsteady earnings. The rich are (especially the asset rich) more able to cope with such variations - and so more likely to be able to accept a modest tax rise

Which is what bugs me. You say I want to 'soak the rich'. A return to slightly higher rates, as seen under Clinton or Reagan, is not 'soaking' them. It's still at the low end compared to in the 60s and 70s, and would not bring penury unto them or the nation. Your desire to knock down straw men seems to be insatiable.

Cutting taxes can reduce revenue. Raising taxes can reduce revenue. Cutting taxes can increase revenue. Raising taxes can increase revenue. Happy?

Always happy, Steve, nice to see you embrace reality for a brief moment. I'm sure it will be brief, though.

And, the higher you raise taxes, the more diligent they will be to shelter their income. Tax reform is what we need, but, of course, that would mean resisting the lobbyists.

No problem with the latter part. Closing loopholes is a never-ending task. Dealing with offshore activities will always be an issue. But ultimately people will always try and pay as little tax as they can, whatever the tax rates, as long as the effort costs less than the benefit.

The main way to avoid taxation would be to move to a tax haven. Those are being slowly eked out, and the US is pretty low-tax anyway. Besides, where else to do business, right? The problem is over-estimated (and under-enforced when it comes to tax loopholes) if you think it means an exodus or that people will cease to innovate.

bbauska wrote:

geojanes wrote:So how about taxing the rich until they pay as much as the average working man?

A great reason for the "flat tax". Three tiers, no deductions for anyone.

By definition, that is not a 'flat tax'.