When poverty is defined as relative want rather than existential need, states decay and societies decline. In the fifth century, Athenians were content to be paid to go to the theater; by the fourth, they were paid also to vote — even as they hired mercenaries to fight and forgot who won at Salamis, and why. Flash mobbing did not hit bulk food stores. The looters organized on Facebook through laptops and cell phones, not through organizing during soup kitchens and bread lines. Random assaults were not because of elemental poverty, but anger at not having exactly what appears on TV.
Obesity, not malnutrition, is the affliction at Wal-Mart. In our strange culture, that someone drives an overpriced BMW apparently means that our own Toyotas don’t have air conditioners or stereos. But that John Edwards or John Kerry or Al Gore has a huge house doesn’t mean that mine is inadequate — or the tract homes that sprout in my community for new arrivals from Mexico are too small.
Of course, the elite have responsibility to use their largess wisely and not turn into the Kardashians. But that a fifth of one percent of the taxpayers are finding ways not to pay at the income tax rate on their large incomes does not hurt the republic as much as 50% of the population paying no income tax at all. The latter noble sorts do not bother us as much, but their noncompliance bothers the foundations of our society far more than that of the stingy, but minuscule, number of grasping rich.
Yup.
Reading this, and Monty’s daily DOOM at Ace’s place, http://minx.cc/?post=321824 makes me dream that maybe the McGuffinite for space exploitation would somehow pop into existence in a Cartesian “I think therefore I am” self-fulfilling way under a space program administered by a vice-President Gingrich, following the old recipes from “A Step Farther Out” to ride to the rescue of today’s zero-sum world.
It’s not just 50% paying no income tax, but government benefits that same 50% demands and the punitive taxes they demand on the rest of us to pay for those benefits.
As we get poorer due to policies it just builds the… Envy and Marxism.
“The first step in community organization is community disorganization.”
Um, do we really want to push this “50% paying no income tax” meme?
President Obama has been long pushing his “evil Bush-era tax cuts on the rich!” mantra that it has become not just his Great White Whale, but Ahab’s obsession that it wasn’t the whale (or the tax cuts) but the malevolent power behind the whale or the tax cuts, that the tax cuts are the “pasteboard mask” behind the real Evil.
Besides cutting taxes “on the rich”, the Bush tax cuts cut taxes for a good number of po’ people, bringing us to this situation (along with the weak economy) that 50 percent of us pay no income tax, although I am thinking everyone receiving a W-2 statement is reporting FICA (Social Security) tax, which is pretty large, pretty much is thrown in with General Revenue as there is no Algore “lock box”, and to most people looking at their meagre net pay stub, is a distinction without a difference.
Former Speaker Nancy Pelosi, bless her black little heart, wanted the Bush tax cuts to simply expire for everybody, which according to revenue-neutral scoring (no economic multiplier or demultiplier) would bring in a cool 4 trillion dollars over 10 years, pretty much plugging the worst bleeding of our debt situation, sticking “the rich” for about 1 trillion of that but socking those 50% not paying any income tax with about 3 trillion of the bill.
Something in me wanted that to happen, that all those people who bought into this chant “rich! rich!” (rhymes with the Medieval mob chanting “witch! witch!”), that they would have seen the Bush tax cuts expire, good and hard, and say, “Hey, wait a minute, I’m rich?”
But the President campaigned and has stuck by his campaign promise of “tax relief for middle class families (i.e. 3/4 portion of the Evil Bush Tax Cuts but the rich paying their ‘fair’ (increased) share (raising only 1/4 the money to close the Deficit Gap under optimistic assumption that raising their rates will bring in even that much revenue).”
Much as I don’t like to direct criticism at my Libertarian/Conservative/Right Blogosphere friends (yeah right, Paul, you are saying, yeah right), there is something hollow about Rand and Jerry Pournelle and Glenn Reynolds, expecially, bringing up the “50% of (somebody — low-pay wage earners? People early-retired or on extended unemployment owing to the economic conditions) not paying any income tax at all.” America’s cute little Grandma from San Francisco left to your own plan would have remedied this situation, but is that what you guys want?
Former Speaker Nancy Pelosi, bless her black little heart, wanted the Bush tax cuts to simply expire for everybody, which according to revenue-neutral scoring (no economic multiplier or demultiplier) would bring in a cool 4 trillion dollars over 10 years, pretty much plugging the worst bleeding of our debt situation, sticking “the rich” for about 1 trillion of that but socking those 50% not paying any income tax with about 3 trillion of the bill.
That claimed $4 trillion over 10 years number is only valid if static analysis of tax rates and tax revenue worked. It doesn’t.
If you want to increase tax revenues, the time proven method is to do the things that stimulate the economy. Raising tax rates is historically proven not to stimulate the economy but to actually slow things down. The result is that you never get the amount of increased revenue the rates promise.
The country and perhaps the world is on the edge of bankrupsy. There are many things we can no longer afford to do. Among those things are paying out “earned income tax credits” and other wealth transfers that in many cases completely offset any payroll taxes low income people pay. When the country is running a deficit of over a trillion dollars a year, every line in the budget needs to be reviewed and many reduced or eliminated entirely.
However, the powers that be still refuse to face economic reality. Last week, the House passed a continuing resolution that included increased funding for disaster relief with reductions to other parts of the budget to pay for it. Unfortunately, the Senate wants not only the increased disaster spending but no reductions to pay for it. Put simple, they want to just keep borrowing and printing more money instead of taking even a small step towards economic reality.
“that someone drives an overpriced BMW apparently means that our own Toyotas don’t have air conditioners or stereos.”
There will always be someone with more stylish clothes, hotter girlfriends, or a bigger penis. Money won’t always be the deciding factor in the haves and have nots.
There also isn’t some nobility scale where the less money a person has the more moral and noble a life they lead or that the more money someone has the less noble and moral they are. People are people and you can be a dick if you are rich or poor.
“Of course, the elite have responsibility to use their largess wisely and not turn into the Kardashians.”
It is great to see things like the Gates foundation, why would we want the government to take all that money and choose how to spend it?
Paul Milenkovic Says:
“Um, do we really want to push this “50% paying no income tax” meme?”
Good point. It is important to recognize the other taxes people pay. When one starts adding up all of the various taxes, it is easy to get to the point of Taxes Enough Already.
“Former Speaker Nancy Pelosi, bless her black little heart, wanted the Bush tax cuts to simply expire for everybody,”
Maybe that would be a good idea for the Republicans. Their position could be all of the Bush tax cuts go or none of them do. It might force people to realize that the Bush cuts to tax rates overwhelmingly favored the bottom end of the scale.
Former Speaker Nancy Pelosi, bless her black little heart, wanted the Bush tax cuts to simply expire for everybody
Current law is for them to expire for everybody. It will take a majority of the House, 60 votes in the Senate and the President’s okay to renew any of them.
The best case scenario, in terms of the deficit, is for the GOP to insist on extending all of them, and Obama to insist on not extending them for incomes over $250k, with the result that nothing happens and they expire across the board.
It might force people to realize that the Bush cuts to tax rates overwhelmingly favored the bottom end of the scale.
Favored how? The top 2% of the income scale reaped 25% of the savings.
It might force people to realize that the Bush cuts to tax rates overwhelmingly favored the bottom end of the scale.
Favored how? The top 2% of the income scale reaped 25% of the savings.
The bottom tax rate dropped from 15% to 10%, a 50% reduction.
Old tax rate brackets 15%, 28%, 31%, 36% and 39.6%
New tax rate brackets 10%, 15%, 25%, 28%, 33% and 35%
“That claimed $4 trillion over 10 years number is only valid if static analysis of tax rates and tax revenue worked. It doesn’t.”
Look, one thing that Michelle Bachmann had over Sarah Palin is that if Congresswoman Bachmann would face Katie Couric in an interview, the good Member of Congress could at least tick off Right Blogosphere talking points.
I spend a lot of time on the Right Blogosphere, maybe more time than I should, and I am very well aware the talking point about static analysis and how raising taxes may not raise anywhere near the revenue it is promised to do. If I ran for President, I think I would do at least as well as Michelle Bachmann in that I would know the talking points. In fact, my post is chock full and repleat with qualifications that letting the tax cuts lapse may not raise anywhere near the 4 trillion over the magic 10 years.
So if someone wants to repeat that point for emphasis, they are welcome to do so, but don’t go about it as if I wasn’t clued in already about the static-tax-analysis thang.
And as to the blanket assertion regarding static analysis flat out not working, it is probably a little more complicated than that. I can be convinced that it is flat out true for “the rich! the rich!” because the definition of being rich is that you have enough financial resources to hire smart accountants and game the system. I am not entirely flat-out sure that it is true for po’ people — I think you can tax them and raise revenue.
The important point to make is that Mr. Obama says that he only wants to raise taxes on “the rich! the rich!”, but if he really wants to raise revenue, a lot of po’ people will see their taxes go up. A lot. I think the Conservative/Libertarian/Right Blogosphere needs to rope-a-dope this issue better, because the flip-side of Mr. Obama picking on “the rich!” is our side taking him at his word (remember Mr. Romney’s remark about taking Mr. Obama at his word?) and getting all in a lather that taxes would increase on corporate jets, when the jets thing is only a rhetorical device and Mr. Obama has other intentions.
“The bottom tax rate dropped from 15% to 10%, a 50% reduction.”
Careful, people — that would be a 33% reduction in rate. Going from 10% back up to 15% would be a 50% increase, but the original lowering from 15% down to 10% was only a 33% reduction.
This is one of these things taught at public institutions of higher learning to STEM majors.
“Favored how? The top 2% of the income scale reaped 25% of the savings.”
Um, Jim, this is also something taught to STEM majors when we require them to take courses in Econ and then apply it to Engineering.
Money has a great deal more marginal utility to a po’ person than “the rich!, the rich!” Yes, 25 percent of the total dollar tax cut (yeah, yeah static analysis, I know, I know) went to “the rich!”, which means that a full 75 percent was spread around among po’ people, where it had a much bigger influence, both in number of people and the effect on each of those people. Thus not only did the less-well-off get the lion-share of the cut, the couple hundred a month saved by a person of modest means helped a large number of people out with the grocery and gas budget whereas the thousands of dollars a month that went to a small number of rich people did what, allow them to buy a second yacht?
So why not support Mr. Obama in wanting to extend the (Bush) “middle class tax cuts” (again) and in wanting to harvest a cool trillion (lately it is up to 1.5 trillion) from rich people? Why not indeed? Because rich people are rich because they have ways of spreading their costs unto others, so to the extent that these rich taxes don’t have Laffer Curve effects, you are really placing indirect taxes on po’ folk.
As to Laffer Curve effects, Mr. Obama’s proposed taxes could put a lot of wealthy people in high-tax states into the territory of 50% marginal tax rate or more. Not just Warren Buffet but people in your community — like your doctor and others. I can’t speak for you, but I would like my doctor better compensated than an auto mechanic, but if you have seen the way Medicare trims reimbursements (OK, a bit off subject), there is a move afoot to treat doctors and auto mechanics equally. Places that do that (England, cough, Former Soviet Union, cough) can be scary places to get medical care.
There is a government assisted housing project down the road from work that, no lie, I think every single person living there has a hoverround powered wheelchair. I was driving by the projects to get lunch one day a few months back and it looked like a mobility scooter-show in the parking lot. One guy had his chair coated in fur, with Cadillac wheel covers tacked to the sides, and assorted bling hanging off it. And the chair wasn’t some little seat your sit upright in. No, it was a huge recliner with leg rests so he could kick all the way back as he was roving around the parking lot with his power-assisted krew of homies. And these weren’t retiree aged people I’m talking about; most all looked to be in their 30’s-40’s. When I saw the movie Wall-E and the people in their power chairs I immediately thought about those people in the projects down on Forest Ln and Greenville Ave.
The bottom tax rate dropped from 15% to 10%, a 50% reduction.
75% of Americans pay more in payroll taxes than income taxes, and the Bush cuts gave them no relief from their #1 tax burden. High income households, by contrast, pay lots of income tax, and benefitted far out of proportion to their share of the population. That was the whole point: supply siders (like Bush and the rest of the GOP) care about the top marginal rate, and the way it allegedly discourages economic activity. It’s surely just a coincidence that they, their donors, friends and neighbors are all the primary beneficiaries of their ideology.
Depending on one’s family, the Earned Income Tax Credit can completely offset what they paid in payroll taxes.
Now, it’s true there are more taxes than just federal income taxes and payroll taxes, so it’s hard for someone to completely escape paying something. I do with the people on the other side of the argument would grant this point as well. The extent of the other taxes depends on where you live. Here in Colorado, this is a partial list of the taxes my wife and I pay each year:
1. Federal income tax
2. Social Security tax
3. Medicare tax
4. State income tax
5. Property tax
6. Vehicle use tax
7. Sales tax (almost 8% for applicable purchases)
8. Gasoline tax
9. Taxes on electricity, gas, water and sewage on my utility bill.
10. Multiple taxes on cell phones
11. Taxes on Internet access, DirectTV and land line
Like I said, that’s a partial list of the taxes that quickly came to mind. No doubt I’m leaving out some others at the moment and it doesn’t include various “fees” that the government has levied to get around state and local tax limitations. Now we can ask the question: “How much of my money should we be allowed to keep?”
In a typical year, my wife and I pay over $50,000 a year in taxes on a combined income of about $150K. This wasn’t a typical year – we converted some old IRAs to Roth IRAs and had to kick in an addition $28,000 between the federal and state income taxes.
And when should the government have to cut back in the face of a slowing economy like everyone else? My hours at work were cut almost 20% when the economy slowed and my income dropped accordingly but the demand for ever increasing taxes never did.
Quite frankly, I’m tired of pulling the wagon for a bunch of ingrates. My wife is planning on retiring at the end of the year and I’m looking forward to the lower tax bite.
“75% of Americans pay more in payroll taxes than income taxes, and the Bush cuts gave them no relief from their #1 tax burden.”
Moving the goalposts ^^. You make a good point but your previous comment was that the rich were the beneficiaries of the Bush tax cuts.
“It’s surely just a coincidence that they, their donors, friends and neighbors are all the primary beneficiaries of their ideology.”
/yawn. This whole stereotype that all the rich people are Republicans is getting old. There are just as many if not more rich people who are Democrats and just as many if not more big corporations run by Democrats than Republicans.
Jim, has a poor person ever given you a full-time job?
Poor people give the wrong people jobs all the time in a voting booth.
“75% of Americans pay more in payroll taxes than income taxes, and the Bush cuts gave them no relief from their #1 tax burden.”
Jim, I am shocked, shocked that you would come out that way against . . . (cue Law and Order “dum dum” chords) Social Security.
If you take away the payroll tax where people contribute to The System, Social Security truly becomes nothing but a welfare program. The dignity in receiving Social Security is what you have paid into the system. As the benefits you receive for Social Security are capped, so is the amount of tax you pay in, so how can any president offer relief to the payroll tax, apart from Mr. Bush’s reduction in income tax at the lower end, without harming the system.
Jim, it pains me to do this, but I am going to have to report you to AtackWatch for disrespecting Social Security.