TAX THOSE RICH BASTIDS

[Timminz]

tax_rate = 5 * ln(annual_income)

math solves everything

Maybe it's been too long since I took a math class, but wouldn't that be a hugely oppressive tax rate?

Almost 50% on people earning only $20,000/year?

[esiemer]

disclaimer: i typed this quickly b/c i don't have much time, sorry for sloppy quotes and such

Well, BigBallinStalin, I'm glad you replied. I don't have much time right now, so apologies if I don't cover everything.

You asked me what's "fair"? I think that is too debatable a question, my point was I want a strong and secure country that is solvent.
Then you said something about diminishing returns with taxes, which I think means you are hinting at the Laffer Curve. So can we agree that wherever the "sweet spot" is on the Laffer Curve is fair? The problem is that it is very hard to objectively quantify that sweet spot with so many variables out there. So where do you think the sweet spot is? Where exactly is the pt where we begin to see diminishing returns?
I'll admit I took the short cut to the last time we had a balanced budget, but it you want to approach it a different way, have at it, I'm all ears.

I don't think we need to keep raising taxes to balance the budget. I want a smaller government. I want less expenditures. I'm glad you agree we should cut the military down because we are spending way too much on it. It's gonna cause some short term unemployment problems though.
The other big chunk of non-discretionary spending is Social Security, Medicare and Medicaid. And we can argue all day about cutting those, but it ain't gonna happen in real life. Our politicians can't even raise the retirement age, which is pathetic.

I say no, keep taxes and tax breaks the same, and instead cut expenditures and open up more opportunities for freer trade domestically and abroad.

I'm cool with that, as long as we let the Bush Tax cuts to expire like they are supposed to. Like we were promised they would.

GDP growth was exceptionally good after the recession starting in 2002 up to 2008--which in turn led to lower unemployment and yada yada.

Prove it. Especially show me how many jobs were lost or created under Bush's 8 years.

The "rich" giving you jobs which create more jobs is shown to be self-evident, but of course it isn't the only way, right? Expenditure from consumers aids the system too. There's multiple systems at work, but by crippling one, it starts to fail.

I used to believe your first sentence too, but I have never been able to find any proof of it, could you prove it to me?

Also, this conversation really depends on how one defines "rich." For tax purposes, it's anyone who makes over $138,000 per year

That number is cool with me, but does that boil this whole discussion down to where is the sweet spot of diminishing returns on the Laffer Curve? Is that all we are trying to find? Is that the only thing this thread is looking for? How much should we tax those who make over 138k?

Ah, yes, the "common goods are provided by the government because the government deems that such goods can only be provided by the government itself" argument.

Not sure where you are going with this. I think the government is there to provide infrastructure, security and stability. In areas such as military and health care, they can do it better than private means. This can be proven by comparing our country's Health Care expenditures and coverage with any other Western developed nation. As far as having local militias... dude, really?
The rest of the stuff you said here about our military and other nations providing for themselves is spot on.

Prove it. (about Universal Health care being fiscally and morally and quantifiably better)

You can start by reading "Best Care Anywhere" by Phillip Longman:
http://www.amazon.com/Best-Care-Anywher ... 0977825302

It is about the VA, our very own American Socialist Healthcare that outperforms Private Insurance Healthcare by every important metric.
Then, if you still need convincing, you can just look at this:

from this webpage (this info can be found many other places tho, im just did a quick google search): http://www.examiner.com/extreme-weight- ... -the-world
Look, we spend more and get less!!! That is fiscally irresponsible!! This cripples business!!

Your story is personal, thus limited by its own subjectivity. You can't take your own life story and apply it to everything.
If you didn't care about being taxed 50%, then why don't you pay an extra 11% right now?

First off, I only put my story on here to stem the tide of comments that say: you would feel different if you made lots of money!!
Second, me alone paying extra won't help our country, which is what I want: a fiscally responsible solvent and strong country.
Its also important to ask questions and think critically and be suspicious of the government, but many go too far and become paranoid to the point where they stop believing in math and facts (like our healthcare is fiscally irresponsible, tax cuts do not cause more tax revenue, rich people are not being taxed to death-in fact they are taxed less now than they were under Reagan).

Clamoring on and chest-thumping about your $200k per year while asserting that "I herp; therefore, I derp" isn't really productive.

Dude, you made it all the way to the end being rational and making good points, then you go off the deep end. I do not make 200k per year. I plan on one day making that. I don't herp, I research and look at facts and my opinion changes over time as I learn more. Rather than trying to herp derp me, why don't you just stick to the facts?
I'm a grown up, if I'm wrong on something I would rather learn from you or anyone else than continue being wrong.

[got tonkaed]

Well, what's "fair," right? There are diminishing returns with taxes. Enacting higher taxes and less tax breaks for the "richer" are only useful if we assume that all that money would be better spent elsewhere. But it isn't. It goes to a wasteful and reckless organization, which itself has led some of us to the reasoning that now we need higher taxes for it to balance its own budget.

I say no, keep taxes and tax breaks the same, and instead cut expenditures and open up more opportunities for freer trade domestically and abroad.

The major philosophical difference here is going to arise from your efficiency argument. While it is a metric by which you can judge any particular economic decision or the sum of a group of decisions it is not the only metric. You could just as easily argue the idea that governments are able to make inefficient decisions that serve to benefit groups of people and thusly argue against your position.

There is sort of a joke about statisticians that they are very good at proving exactly what they want to prove, but nothing else. While you can argue efficiency is the best metric to use, to quote you, you have to "prove it". I am a big fan of efficiency, i use it alot in my posts to be honest, but when you are talking about government spending, it is evident that governments do not act in that manner.

It is not wrong to seek efficiency. But to argue that a lack of efficiency therefore equals wrongness, when an entity puts itself in a position to embrace certain levels of inefficiency is unbalanced.

I am in agreement about the idea that we should promote trade and cut expenditures. But what do you plan on cutting and why?

[PLAYER57832]

In other words, too often "efficiency" just means someone pulling more money off of others. That may be a great way to enhance a few people's pockets, but is not necessarily good for national or world economies overall.

Example:
Better agricultural practices lead to efficiency in our country. This competes with local farmers in areas that don't have the infrastructure or other things (education, for example) necessary for such efficiency. Our answer? To force these countries to "open their markets" in the interest of "free enterprise"? The result? In the short term, loads of food, often even free food, in cities. Farmers, meanwhile wind up no longer being able to provide for themselves. This ultimately adds to the overall poverty of a country. Haiti is a prime example. (earlier in this century).

When "efficiency" winds up cutting out people's employment and there is no other employment available, it is not beneficial overall. When that "efficiency" just means quicker use of resources, the impact is outright negative. However, because those costs are not taken into account, the bigwigs continue to claim benefit... even while they are driving us further and further into deep holes.

[PLAYER57832]

Universal, single payer health care is the most efficient and fiscally responsible way to run a country, as well as being the only morally acceptable choice. If you are for our current American system, then you are against balanced budgets and the teachings of Jesus.

Prove it.

Not a problem.. just look at any other industrialized nation in the world. The systems vary, but they ALL do it better than we do.

[esiemer]

Universal, single payer health care is the most efficient and fiscally responsible way to run a country, as well as being the only morally acceptable choice. If you are for our current American system, then you are against balanced budgets and the teachings of Jesus.

Prove it.

Not a problem.. just look at any other industrialized nation in the world. The systems vary, but they ALL do it better than we do.

Exactly. And that is not even looking into factors that are very hard to measure, such as increased stress on patients due to imminent financial ruin hampering their ability to get well and work, which negatively impacts the economy.
Or, bankruptcies from medical bills (a uniquely American phenomenon) taking money out of the economy.

[GreecePwns]

But that money DOES go back into the economy [(unless of course they're putting the money under their mattresses, which nearly all don't because it's just stupid--unless it's gold ]

How do you think that money for inheritance builds?

Saving money is done by spending it on stable investments over long periods of time. It goes into buying bonds and stocks (something that again benefits the economy and in some cases the government itself). Savings even in banks is also beneficial for the economy. All the above provide long-term stability and sustainable economic growth.

And what's so great about increasing the incentives for short-term consumption compared to long-term investment? Consumption is way too high proportionally for the US anyway. By decreasing interest rates, the Fed just incentives people to spend money for the short-term.

When it comes to government revenues and tackling the deficit, which is priority #1 in my eyes, collecting money through sales taxes is a more effective measure. There are two effective ways to stimulate an economy in my eyes: through public works or through lowering taxes on those that will spend money. It doesn't necessarily involve deficit spending/borrowing, as a well-run government, when expanding its expenses or lowering revenue, will find a way to compensate for it through increasing revenue in other areas or cutting unnecessary expenses in other areas. And if both methods of stimulating the economy are accompanied by methods of paying for it that don't involve drastic cuts or raises in taxes (i.e. a mix of both), the government retains its fiscal integrity and the economy isn't destabilized as much.

Reckless consumption and poor investments over time will just keep the poor poorer. There should be higher incentives to save, payoff personal debts, and decrease unnecessary consumption (like building unnecessary bridges, fixing good condition roads, etc.)

People and businesses should live within their means. Government should strive to create the most efficient economy possible, and adjust its means (increase or decrease revenue/expenditure) in order to do this.

And the same could be said of "not-rich" people who save. THEY SHOULD BE SPENDING TO SAVE THE ECONOMY according to your logic.

Your plan is short-sighted.

The "not-rich" people who save would be better off too. Since they already save, a decreased tax burden would allow them to spend if they so choose to or save if they so choose too. In general though, the people who live paycheck to paycheck don't have much discretionary income, while those with higher income do. Telling these people to just live with less is closer to phatscotty's "telling people when they can and can't spend money" crap than what I'm saying is. It's still a universe off though.

The government and its services already run themselves like a business. They're on average more inefficient and don't face the threat of bankruptcy.

The problem with publicly run "businesses" is that they have no need to reduce costs, because that would reduce their budget or money received--the entire incentive-system is screwed up, and because they're a monopoly--there's no competition forcing them to improve. Publicly run businesses have no need to improve quality because their customers are involuntary forced to pay for their services (taxation), and once again it's a monopoly--no competition, thus no need to improve. There's no market forces acting as a balancing force on monopolies that forcibly extract wealth from their customers.

This applies to commodities specifically. In a case like health insurance, the government, in a single-payer system, needs only to provide the money and take in what it lays out as opposed to private insurance which needs to take in what it lays out plus make a profit (which usually is around 30 percent of revenue). This also applies to Social Security, but then the government borrows the money, a practice which only creates inflation. Social Security would be fine for generations if its excesses were simply left alone and everyone were taxed. The only argument against such a Social Security would be an ethical one, not an economic one. Where does the government have a monopoly on that you believe it shouldn't?

Yeah, flat taxes aren't my preferred method of involuntary extracting wealth from people either.

If you want more purchasing power, then the current monetary policies need to be readjusted. That's the first thing the US government should be doing, but it really isn't doing so fast enough. The monopoly on monetary supply needs to be readjusted, or the Fed requires more regulation.

If you wanted higher consumption, then allow deflation to occur. It would benefit consumers the most, and hurt producers--with the more inefficient ones being weeded out. It would be interesting, but it's never been allowed to happen ever, so people are reasonably scared.

One of my very conservative economics professors said something I've never heard of today. Apparently, banks in other nations are only in charge of limiting inflation, while the Fed is in charge of limiting inflation AND unemployment, and that the Fed should be in line with the other nations' banks. I'll be honest. I don't know what the effects of this would be (higher unemployment? Wouldn't that lead to a need to be a welfare state?) but I've never heard anything like that before so I'm taking it with a grain of salt. I don't even know what the banks of other nations do in this regard.

I disagree. If someone has no money and keeps spending money, then they need to sell assets and/or reduce unnecessary expenditures. A goal should be set for decreasing government expenditures in sections A, B, C, etc, by X% in the next 10 years. Then the objectives on how to do so should be drawn up, critically examined, then carried out for each section--just like an efficien and effective business does it.

It seems our views are compatible here. I am flat-out against an across the board cut, but I would like to see cuts in certain places, and while increasing taxes won't get the agreement of everyone, there are certainly places where the government can get more money out of that even libertarians would most certainly agree to.

Simply throwing money at people doesn't do long-term good... you wouldn't happen to be a Neo-Keynesian, would you? Because you sound like one...

I don't like labels, and I especially don't want to apply one to myself considering I'm just finishing up my final semester of undergraduate school.

[jimboston]

blah blah blah blah blah

fixed

I will start with one axiom often ignored by the right.

Definition of the term axiom:
1. A self-evident or universally recognized truth; a maxim.
2. An established rule, principle, or law.
3. A self-evident principle or one that is accepted as true without proof as the basis for argument; a postulate.

If you look at history, one marker of a society about to collapse is increased wealth disparity. The rich get richer and the poor get poorer.

So this is a "universally recognized truth"... yet it is "ignored by the Right".

Yet if it was universally acknowledged as the truth... then the Right (by definition) would not ignore it.

That said... I believe wealth disparity to be one reason a society might collapse. I don't believe it to be the sole reason. Nor do I believe it to be a marker for all societies that are about to collapse.

Guess it's not really an axiom... huh.

Everyone from Marx to Machiavelli acknowledged this fact.

... and this is key because we all agree with everything these two fellas thought. There's no way one could possibly disagree with either, and certainly not with both.

... even though you could eliminate every welfare payment and still not make a dent in the deficit...

Define "welfare"... I think you're using a very very narrow definition of term. It's not just payments made by the Welfare Dept. It's grants to non-profits. Subsidized Housing. School Lunch Programs. Free Health Care. Special Education Programs. Etc. Etc. Etc.

I am not (nor have I ever) suggested we get rid of all of this.

... but please let's be sure we know what we are talking about here.

I personally think paying a few deadbeat parents is better than letting kids starve.

You are entitled to that opinion.

Why must I pay for your opinion?

Hey... why not take the kids into orphanages and then let the deadbeat parents starve? That would be my solution. The kids would be better off in well run facilities, then living with parents who prefer to buy smokes / liquor / drugs... before buying cheerios.

Ironically, its cheaper to just pay people off than to truly fix the problems making them poor.

Prove this!

Typical Liberal Lie. It's only expensive if you make it expensive, and set the "rules" such that it is easy for people to take advantage of them and hard to catch them. The rules could be easily weighted in the other direction.

Anyway, when I say the wealthy cost us more than they contribute, I mean externalities and enviromental damage mostly. blah, blah, blah, environment... blah, blah, blah.

Ah... finally addressing the question.

... but wait... what kind of answer is this?

OK... so yes... "rich" people "damage" the environment more so than poor people... I might agree to this in part. They have a higher "carbon footprint" by heating/cooling larger houses, flying everywhere, running big TV's, driving big cars, etc.

... but yet "poor" people do not have NO carbon footprint. For argument's sake I will agree it may be much smaller than that of a "rich" person... but you have to grant that it's not zero.

So... let's use logic and math here...
Rich person pays a lot already... and has very very high carbon footprint.
Poor person pays NOTHING already... and has a low carbon footprint.

Hmmmm... who is 'costing more than they contribute' in this math?

The other part they ignore is why so many people need to have subsidies and who they are. Though Phattscotty and, it seems, you, like to talk about those who "don't work" as if they were the problem, the real truth is that most of those getting subsidies are working. Sometimes working fulltime, often working more than one part-time job. That AND talking care of kids, etc.

In principal I have no problem helping out people who are working and trying and just not making it. I don't think we need to subsidize their lives... but I have no problem helping.

That said... in my job I see, with my own eyes, abuse. I have seen it and reported it, and seen ways it can be addressed... and no one in gov't I have spoken to gives a flying f*ck. In fact... people who work in these "social welfare" agencies are often measured not by how quickly they help someone get back on their own feet, or how few people need help... rather they are measured by how many people they help / how many do need help. The more people that need help the bigger the budget. The bigger the budget the more they get paid. The people who manage are welfare systems are incentivized to grow the welfare system.

it means that taxpayers are artificially supporting the companies with our tax dollars.

In part maybe... it also means that taxpayers are artificially supporting the low costs of goods & services provided by those companies. If McDonald's had to pay people more, the costs the food goes up. My tax dollars aren't paying McDonald's additional profit... we are paying more people to eat that shit.

Hey... if we cut welfare, those workers would INSIST on better pay... or they would work harder to find better paying jobs.

blah, blah, blah... more talking in circles... blah, blah, blah

blah, blah, blah... healthcare talk... blah, blah... unrelated to original question...

OK TO SUMMARIZE PLAYER

"Rich people are evil... and even though I define "rich" as multi-millionaires... I still want to tax people who make $200K a year. They aren't evil... but they are kinda evil... and like I think poor people are good... so there!"

[john9blue]

tax_rate = 5 * ln(annual_income)

math solves everything

Maybe it's been too long since I took a math class, but wouldn't that be a hugely oppressive tax rate?

Almost 50% on people earning only $20,000/year?

that's because i'm dumb and wrote "ln" instead of "log"

[Night Strike]

Universal, single payer health care is the most efficient and fiscally responsible way to run a country, as well as being the only morally acceptable choice. If you are for our current American system, then you are against balanced budgets and the teachings of Jesus.

Prove it.

Not a problem.. just look at any other industrialized nation in the world. The systems vary, but they ALL do it better than we do.

And how many of those countries have a population of 300 million and over 50% of their population paying 0% in income taxes?

[GreecePwns]

Universal, single payer health care is the most efficient and fiscally responsible way to run a country, as well as being the only morally acceptable choice. If you are for our current American system, then you are against balanced budgets and the teachings of Jesus.

Prove it.

Not a problem.. just look at any other industrialized nation in the world. The systems vary, but they ALL do it better than we do.

And how many of those countries have a population of 300 million and over 50% of their population paying 0% in income taxes?

Ahhhh I see...it's more taxes you want.

[esiemer]

Universal, single payer health care is the most efficient and fiscally responsible way to run a country, as well as being the only morally acceptable choice. If you are for our current American system, then you are against balanced budgets and the teachings of Jesus.

Prove it.

Not a problem.. just look at any other industrialized nation in the world. The systems vary, but they ALL do it better than we do.

And how many of those countries have a population of 300 million and over 50% of their population paying 0% in income taxes?

Your questions have no relevance to my point. If anything, having more people means you could provide health care cheaper.

Why do you think America can not do what other countries do, but do it better?

We could use all the money we are spending right now on Medicaire/Medicaid?SChip/etc and create a single payer nationalized system. Can you imagine how much time and money American businesses would save if they didn't have to deal with providing employers healthcare?

I'll give you a hint: it would raise the income and productivity level of every Small Business owner in the country, and they would save more money than if we keep the top tax rate at 35%, or whatever your scheme is.

TL;DR Your question is irrelevant, single payer health care would increase wealth for people who work hard and provide more jobs than any tax cut you are proposing.

[BigBallinStalin]

But that money DOES go back into the economy [(unless of course they're putting the money under their mattresses, which nearly all don't because it's just stupid--unless it's gold ]

How do you think that money for inheritance builds?

Saving money is done by spending it on stable investments over long periods of time. It goes into buying bonds and stocks (something that again benefits the economy and in some cases the government itself). Savings even in banks is also beneficial for the economy. All the above provide long-term stability and sustainable economic growth.

And what's so great about increasing the incentives for short-term consumption compared to long-term investment? Consumption is way too high proportionally for the US anyway. By decreasing interest rates, the Fed just incentives people to spend money for the short-term.

When it comes to government revenues and tackling the deficit, which is priority #1 in my eyes, collecting money through sales taxes is a more effective measure. There are two effective ways to stimulate an economy in my eyes: through public works or through lowering taxes on those that will spend money. It doesn't necessarily involve deficit spending/borrowing, as a well-run government, when expanding its expenses or lowering revenue, will find a way to compensate for it through increasing revenue in other areas or cutting unnecessary expenses in other areas. And if both methods of stimulating the economy are accompanied by methods of paying for it that don't involve drastic cuts or raises in taxes (i.e. a mix of both), the government retains its fiscal integrity and the economy isn't destabilized as much.

But if you want to encourage an increase in consumption to stimulate the economy, then a sales tax would just hamper such efforts. It also would marginally diminish the real wages of the poorer more so than the rich, which is something that should be avoided.

The problem with public works is evident in the New Deal and how such efforts did not get the US from the depression. If you'd like some reading material on that, please let me know. They do a much better and more thorough job than I could at the moment.

Another thing with public works is that it extracts wealth from the economy and distributes it in places where it might not even be necessary--like building way too costly bridges in areas that don't need a $50ml bridge, just a $20ml one. Or building a silly 30 mile-long guard rail in between the median on the highway--it's not too effective in stopping the occasional car from flying across the highway, and the extremely high cost itself isn't worth the decrease in the already small chance of that health hazard.

For more effective ways on improving the economy, monetary policy needs to be addressed first. The Fed has failed tremendously, and it continues to fail. ATM I've no idea how to fix such a problem, because my knowledge on the topic is largely based on seminars and conversations with the experts on that topic.

Reckless consumption and poor investments over time will just keep the poor poorer. There should be higher incentives to save, payoff personal debts, and decrease unnecessary consumption (like building unnecessary bridges, fixing good condition roads, etc.)

People and businesses should live within their means. Government should strive to create the most efficient economy possible, and adjust its means (increase or decrease revenue/expenditure) in order to do this.

You're assuming that the government can determine what those means are in an inexpensive and reliable method. It can't, and it's a balancing act. With a command economy (or total government control which delegates what those means are), it fails, so now most countries are working with a mixed economy (command and market). What the world has seen is that when the government lets people make their own decisions (or decentralize decision making), things are left to market forces and operate on their own.

Then the big leap of faith is, is government even necessary at all? Where's that sweet spot on limiting government (or that point between command and market economies)?

And the same could be said of "not-rich" people who save. THEY SHOULD BE SPENDING TO SAVE THE ECONOMY according to your logic.

Your plan is short-sighted.

The "not-rich" people who save would be better off too. Since they already save, a decreased tax burden would allow them to spend if they so choose to or save if they so choose too. In general though, the people who live paycheck to paycheck don't have much discretionary income, while those with higher income do. Telling these people to just live with less is closer to phatscotty's "telling people when they can and can't spend money" crap than what I'm saying is. It's still a universe off though.

Maybe we've got a misunderstanding here. From what I remember reading, you were talking about increasing incentives for people to consume more products. I was saying that's not a good solution because it only creates an artificial demand for such products. This is in turn is just a poor expenditure of people's money.

What I'd like to find out is if the government encouraged everyone to save more, to not consume but to pay off their personal debts (through whatever policies they have available), and if deflation were allowed to occur, I wonder if the lack of growth in the US GDP in the short-term would be offset by a higher purchasing power for USD currency-holders, a higher long-term stability, and a weeding out of unnecessary industries/businesses.

The government and its services already run themselves like a business. They're on average more inefficient and don't face the threat of bankruptcy.

The problem with publicly run "businesses" is that they have no need to reduce costs, because that would reduce their budget or money received--the entire incentive-system is screwed up, and because they're a monopoly--there's no competition forcing them to improve. Publicly run businesses have no need to improve quality because their customers are involuntary forced to pay for their services (taxation), and once again it's a monopoly--no competition, thus no need to improve. There's no market forces acting as a balancing force on monopolies that forcibly extract wealth from their customers.

This applies to commodities specifically. In a case like health insurance, the government, in a single-payer system, needs only to provide the money and take in what it lays out as opposed to private insurance which needs to take in what it lays out plus make a profit (which usually is around 30 percent of revenue). This also applies to Social Security, but then the government borrows the money, a practice which only creates inflation. Social Security would be fine for generations if its excesses were simply left alone and everyone were taxed. The only argument against such a Social Security would be an ethical one, not an economic one. Where does the government have a monopoly on that you believe it shouldn't?

That's the common goods problem. I'll start a new thread on that later, and get got_tonkead involved as well. Let's just focus on taxes for now.

Yeah, flat taxes aren't my preferred method of involuntary extracting wealth from people either.

If you want more purchasing power, then the current monetary policies need to be readjusted. That's the first thing the US government should be doing, but it really isn't doing so fast enough. The monopoly on monetary supply needs to be readjusted, or the Fed requires more regulation.

If you wanted higher consumption, then allow deflation to occur. It would benefit consumers the most, and hurt producers--with the more inefficient ones being weeded out. It would be interesting, but it's never been allowed to happen ever, so people are reasonably scared.

One of my very conservative economics professors said something I've never heard of today. Apparently, banks in other nations are only in charge of limiting inflation, while the Fed is in charge of limiting inflation AND unemployment, and that the Fed should be in line with the other nations' banks. I'll be honest. I don't know what the effects of this would be (higher unemployment? Wouldn't that lead to a need to be a welfare state?) but I've never heard anything like that before so I'm taking it with a grain of salt. I don't even know what the banks of other nations do in this regard.

There's what's called fractional reserve banking, which means that if you deposit $1000 in a bank, it can then lend out that $1000 to three other people. The Fed (or FDIC) sets the limits on how much cash a bank should have on hand (it's about 10%... I think...).

So, banks and the Fed don't limit inflation, they actually are the primary source of it--especially when the Fed lowers interest rates (more money flowing in the system) or through quantitative easing (PRINT MORE MONEY).

I think what your teacher is talking about is letting the USD balance itself instead of letting banking institutions and the Fed tamper with it, but then again, I don't think he's really proposing that, so.. I dunno, don't have enough info.

I disagree. If someone has no money and keeps spending money, then they need to sell assets and/or reduce unnecessary expenditures. A goal should be set for decreasing government expenditures in sections A, B, C, etc, by X% in the next 10 years. Then the objectives on how to do so should be drawn up, critically examined, then carried out for each section--just like an efficien and effective business does it.

It seems our views are compatible here. I am flat-out against an across the board cut, but I would like to see cuts in certain places, and while increasing taxes won't get the agreement of everyone, there are certainly places where the government can get more money out of that even libertarians would most certainly agree to.

Simply throwing money at people doesn't do long-term good... you wouldn't happen to be a Neo-Keynesian, would you? Because you sound like one...

I don't like labels, and I especially don't want to apply one to myself considering I'm just finishing up my final semester of undergraduate school.

I'll address cuts in another post that's going to be geared at got_tonkaed.

And for labeling, good response. As Soren Kierkegaard once said, "Once you label me, you negate me."

A more fun one is by Groucho Marx: "I'd never join a club that would allow a person like me to become a member."

[BigBallinStalin]

@esiemer

Man, now you got me running around getting sources and data for you...

But I really appreciate the honesty, and I apologize for casting the herpaderp curse on you.

I'll look at that thing you mentioned about health care too.

I'll share what I've got this Friday or Saturday because I've got tests this Thursday in economics and marketing.

_______________________________________________

@got_tonkaed

I'm largely in agreement with you, and I forgot to mention the question of effectiveness with efficiency. I don't think that the government does an effective and efficient job in providing certain services compared to privately run organizations.

Granted there are common goods problems like water, national security, infrastructure (roads and power), etc that require close examination, but that's another fun topic that we'll put on the backburner for now.

Anyway, this Friday, I'll get to this answering your question: "I am in agreement about the idea that we should promote trade and cut expenditures. But what do you plan on cutting and why?"

__________________________________________________

[thegreekdog]

I don't think taxing the rich is the best answer to our country's problems. Again, please, for my sake at least, keep in mind what the federal government's definition of "rich" is.

However, some arguments I've heard:

- The rich can afford to pay more taxes (even the rich admit it). And by the rich, they mean Hollywood actors and producers, media moguls, and people like Bill Gates and Oprah Winfrey who have everything they could possibly want. Except that by "rich" the government means pretty much anyone making over $120K a year.
- Trickle down economics doesn't work... taxing the rich won't mean a loss of jobs. I don't know if trickle down economics work because I'm not an expert in economics. I do know that a company that pays a 35% federal tax rate, a 10% state tax rate, and sales tax on its purchases (gottonkaed, the corporate tax burden in the United States is second only to Japan... which is one of the main reasons companies in the US are doing things overseas... you're not usually wrong, but you're wrong about this one), is not likely to go out and hire more people without first raising prices. I also understand that companies rely on employees to provide the products and services, so it's definitely a give and take and the "working class" which includes those guys making $120K a year by the way, are certainly not "dependent" upon the rich.
- The rich take up more resources and use more government services, so they should pay more. They already pay more. I don't know the actual statistic, but there is some staggering percentage of US federal taxes that are paid by the richest 1%.

[got tonkaed]

I do not feel I have made a comment discussing corporate tax rates. It is possible I have made a comment that could be inferred to be related to corporate tax rates, but as far as I am aware, the only areas in which I have posted about is related to individual taxation rates.

[thegreekdog]

I do not feel I have made a comment discussing corporate tax rates. It is possible I have made a comment that could be inferred to be related to corporate tax rates, but as far as I am aware, the only areas in which I have posted about is related to individual taxation rates.

You are correct, apologies.

I don't know the relative personal income tax rates of other countries. However (and I believe I posted the backup stats elsewhere) a "rich" employer who lives and works in New York City could be paying upwards of 55% of his or her income to a government entity through taxes (counting federal, state and local personal income taxes and federal, state and local unemployment compensation taxes, Medicare, etc.)

[PLAYER57832]

I don't think taxing the rich is the best answer to our country's problems. Again, please, for my sake at least, keep in mind what the federal government's definition of "rich" is.

However, some arguments I've heard:

- The rich can afford to pay more taxes (even the rich admit it). And by the rich, they mean Hollywood actors and producers, media moguls, and people like Bill Gates and Oprah Winfrey who have everything they could possibly want. Except that by "rich" the government means pretty much anyone making over $120K a year.
- Trickle down economics doesn't work... taxing the rich won't mean a loss of jobs. I don't know if trickle down economics work because I'm not an expert in economics. I do know that a company that pays a 35% federal tax rate, a 10% state tax rate, and sales tax on its purchases (gottonkaed, the corporate tax burden in the United States is second only to Japan... which is one of the main reasons companies in the US are doing things overseas... you're not usually wrong, but you're wrong about this one), is not likely to go out and hire more people without first raising prices. I also understand that companies rely on employees to provide the products and services, so it's definitely a give and take and the "working class" which includes those guys making $120K a year by the way, are certainly not "dependent" upon the rich.
- The rich take up more resources and use more government services, so they should pay more. They already pay more. I don't know the actual statistic, but there is some staggering percentage of US federal taxes that are paid by the richest 1%.

#1 While our official corporate tax rate is high, the real rate that most companies pay is not. Many of the biggest corporations actually pay no tax or very little tax.

#2. As I have said before, setting 150K as the definition of "wealthy" within the US is dumb. I am not sure even those making 1 million right now would be considered "wealthy". I would set it more like 2 million... and I would not count some real estate assets. (I mean, even a fairly modest home in Santa Barbara costs a half million!). In truth, the disparity of incomes is so high within the US that even one set amount doesn't make sense. A decent one bedroom apartment in Santa Barbara (not Montecito, CA) can easily cost 700-800 a month (and that is probably a low estimate). By contrast, you can buy a luxury home with an indoor pool for less than that a month. (under 200K to buy.. if you look for foreclosures, you can get some REAL bargains).

#3 paying more than someone else doesn't mean paying enough. Whether a company is paying enough depends on what they cost the rest of us. Employers that hire workers who have to be subsidized to get housing, food, etc cost the rest of us. Employers that pollute cost us. Those who use resources that are not replaceable (any mining operation and some agriculture) is taking from future generations. That those employers are then able to turn around and offer goods at a seemingly lower price is merely illusion. The fact is that neither the cost paid by the customer nor the amounts paid by the company are really enough to pay for what they cost the economy, people as a whole.

#4. A lot of traditional western economics is truly based upon a "colonizing" type attitude.. use it and leave it. Minerals and trees are there to be taken. We now understand that reforesting is beneficial, yet many of our laws still actually force companies to cut in order to pay taxes. (just as an example) Other countries are no longer willing to just let bigwig rich guys come in and exploit the population. When they do, they want to be the exploiters themselves and not just let the wealth go off to the US and Europe. Even worker conditions are changing, though much more slowly. And, the main reason workers in other countries are not demanding the same safety protections US workers do is education.

The claim that we have to allow our workers to endure unsafe conditions so that a corporation can compete overseas is one of the most evil arguments there is (note.. the people making this are not necessarily evil, they just pretend the results of their actions are other than they really are). That workers in other areas are desperate enough or ignorant enough to risk their health and that of their children for far less than American workers does not mean it is good or right or even beneficial to the world as a whole. Those kinds of "trade-offs" are considered "OK" because too often the people making these decisions don't even have to look into the results of their decisions.

In fact, if you want to find real evil.. just look at all the debate against global warming and other scientific findings. It is NOT a cooincidence that ignorance of real science goes hand in hand with the worst of corporate abuse.

[thegreekdog]

I'll address those paragraphs that had to do with mine:

As to your #1 - The companies that do not pay high taxes in the United States either do not make a lot of income (from a books and records perspective or a tax perspective) or do not have a large presence in the United States.

As to your #2 - Assets are not included in the personal income tax. Income is the only thing included. Therefore, the value of my home is not included (except for the mortgage interest deduction I get... but only if I make less than a certain amount of money).

[Aradhus]

I'll address those paragraphs that had to do with mine:

As to your #1 - The companies that do not pay high taxes in the United States either do not make a lot of income (from a books and records perspective or a tax perspective) or do not have a large presence in the United States.

Surely they don't pay high taxes because the US govt is trying to get them to employ within the united states.

[thegreekdog]

I'll address those paragraphs that had to do with mine:

As to your #1 - The companies that do not pay high taxes in the United States either do not make a lot of income (from a books and records perspective or a tax perspective) or do not have a large presence in the United States.

Surely they don't pay high taxes because the US govt is trying to get them to employ within the united states.

Unfortunately, this is not the case. You would think that would be the strategy, but it's not.

[PLAYER57832]

I'll address those paragraphs that had to do with mine:

As to your #1 - The companies that do not pay high taxes in the United States either do not make a lot of income (from a books and records perspective or a tax perspective) or do not have a large presence in the United States.

That last part is the key. A lot of what most people, even what businesses that are less wealthy, wind up making is not "officially income". In short.. you are not really disagreeing with what I am saying, just explaining it another way.

[Aradhus]

So what are tax breaks, subsidies, etc?

[PLAYER57832]

So what are tax breaks, subsidies, etc?

greekdog can answer more fully, but one example is that companies can deduct expansion. This one seems to make sense, except that it has often wound up encouraging companies to invest in things that are not truly beneficial or profitable.
Some are seemingly small, but add up, such as various employee expenses. Vehicles, meals, all of that is sometimes deductable. They have curtailed some entertainment deductions, but a lot of other things remain.

[thegreekdog]

I'll address those paragraphs that had to do with mine:

As to your #1 - The companies that do not pay high taxes in the United States either do not make a lot of income (from a books and records perspective or a tax perspective) or do not have a large presence in the United States.

That last part is the key. A lot of what most people, even what businesses that are less wealthy, wind up making is not "officially income". In short.. you are not really disagreeing with what I am saying, just explaining it another way.

What? First of all, there are rules against excessive excutive compensation (and the deductibility of executive compensation). I'm not familiar with them, but they exist. Second, like I said in another thread - what are companies permitted to deduct that you find objectionable? I want details of what specifically companies are getting away with. What are the tax loopholes. Second of all, the reason that companies like Google don't pay taxes is that their operations are overseas (for tax reasons of course and also because there are other things in the US that cost a lot of money... like salaries... compared to other countries). We've also discussed this before.

So what are tax breaks, subsidies, etc?

Subsidies are taxable income. Tax breaks are taxable income depending upon the jurisdiction. So, if Company X gets a credit in Pennsylvania, it has to take the value of that credit into income for federal purposes (and in all other states).

As a related aside - When I criticize politicians for making the "tax loophole" argument, this is what I'm talking about. Player thinks companies get invalid deductions. Aradhus thinks companies get tax breaks and subsidies that they don't pay tax on. Both are not true.

As another related aside - I heard on the radio today that the best thing the United States can do to slow down the Chinese economy is to export the Environmental Protection Agency, Food & Drug Administration, and other regulators. I laughed out loud. It's a great idea.