Well the debates are over, the pundits and talking heads have spoken; and the winner is…… Nobody. And why is that; because we have 19 days until the election and the only vote that counts is YOURS; not the polls, not the media, not your crazy buddy at work… yours and yours alone.
But one thing you have to remember is that this election as a whole; meaning Presidential and Congressional, will have an historic impact on our country. There is a distinct possibility that we could have the ‘perfect storm’ between the executive and legislative branches of government. The Democratic party could possibly had control of both houses of Congress and the While House; giving them unlimited power to change law and even constitutional amendments; with little to no resistance, and that is scary!
And why is this scary? Well let’s first take a look at Obama’s most recent statement of ‘spreading the wealth around is good for everyone’; how is punishing accomplishment and hard work good for everyone? First, Obama’s tax-rate increases on income will fall heavily on small businesses, which create the majority of net new jobs. Here’s why: According to Internal Revenue Service data, half of all business income is taxed at individual rather than corporate tax rates, and about two-thirds of all flow-through business income is earned by small-business owners with annual incomes exceeding $200,000. The bottom line: Up to one-third of all business income is taxed at the two marginal rates Obama wants to raise.Second, history demonstrates the economic folly of raising capital-gains taxes at any time, and the economic benefit of keeping them permanently low. By influencing the incentives for people to invest, the capital-gains tax directly impacts the demand for — and value of — equities. Similarly, it influences the rate of investment, particularly in new, high-risk ventures. But Obama wants to RAISE capital-gains taxes. But the bigger question is where will it stop? So today it’s $200,000; maybe tomorrow it is $100,000; or less.
And why would I say that; very simple, Obama has outlined numerous spending increases:
A $65 billion-a-year health plan
$15 billion in green energy spending
$85 billion in tax cuts and credits
A $25 billion-a-year increase in foreign aid
$18 billion a year in education spending
$3.5 billion for a national service plan
Put it all together, and we are talking about a $200 billon plan, $800 billion over four years. And that does not even include fixing the alternative minimum tax, a $50 billion-a-year item that will assuredly get passed.
Big question… HOW IS HE GOING TO PAY FOR ALL THAT???
Taking Obama’s statement of cutting taxes on 95% of Americans; there is no way that raising taxes on only 5% of the country will pay for an ADDITIONAL $200 billion in spending; the numbers do not add up. Even if he took ALL of the income of the Forbes 500 riches Americans he could only run the government for a few months; at Today’s spending levels; not counting an additional $200 billion in spending AND a reduction in tax revenues.
It is very simple… to get to a balance budget and have a surplus you can only do two things; increase revenue and reduce spending. In these economic times increasing revenue, i.e. taxes; is not advisable; however decreasing spending is advisable and warranted.
You owe it to yourself and your family to ‘peel the onion’ back on the rhetoric preached by these candidates and really get to know them and what they stand for.
Thursday, October 16, 2008
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Counter to the impression that's being conveyed, finding 200 billion over 4 years without tax increase isn't that hard.
Just get the troops out of Iraq within 2 years and you're there (see http://zfacts.com/p/447.html).
They've severely dented Al-Qaida's operations there, but they're not winning against sundry insurgents. Co-opting local warlords is doing that (thanks to gen. Petraeus' insight). They're mainly filling the gap until the Iraqi military can do the job (again).
Then again you can borrow the money and increase the national debt (see http://zfacts.com/p/318.html). Not ideal, but you can carry over your debts until you can wrap up the Iraq adventure.
And besides, if you're worried about spending, how about the $ 700 billion that was approved recently to bail out the banks?
That 200 billion is a lot of money, but it's going to be well spent. Especially in a recession.
I think you missed something; that was $200 billion in ONE year; not over four years. Over four years it would be closer to one trillion, which is a big pill to swallow; especially in light of the $700 billion bail out, which I do disagree with.
But my point is; that Obama knows that if he is elected President he will inherit the $700 billion bailout; and yet he still he wants to increase spending.
Whereas there are logistical costs of the war in Iraq that could be reduced; there are also some fixed cost of having a military that can not be reduced. And furthermore, Obama wants to redeploy these troops into Afghanistan; so there will be no overall costs reduction of pulling troops out of Iraq.
We simply can not have a cradle to grave economy; we have a history of people going to great links to immigrate; both legally and illegally to America for a better life for themselves; not to have a government give them everything.
We need to give people a ‘hand up’ not a ‘hand out’
Something I just can’t understand is Obama’s desire to increase spending on education to help people get ahead in life, right? I mean that is the desire of getting a college education; isn’t it? To get a better job…but; if you get this better job and make more money; won’t Obama tax you more? Huh? So does he think that those he helps get a better education OWE him something for that; and so he’ll take more money from them? Just a thought.
Redistribution of wealth? Of course. That has been our way for a long, long time.
Do YOU want to pay the same tax rate as someone who earns 1000 x the amount you do? Those oilmen for instance? Who get their wealth from the $4+ a gal gas you're buying?
Our graduated income tax is proof that the American people do believe in redistribution of wealth. We believe that the working people of America deserve to keep more of what they earn than the financeers on Wall Street with their golden parachutes.
We have inheritance taxes because we don't want a group of people at the tax to have a concentration of unearned wealth.
We have allowed the Republicans to interrupt the fair redistribution of wealth in this country to the point where the difference between the bottom 95 % of Americans and the top 5% is the greatest it has been in any society since the time of the French Revolution. We need to close that gap up by taking some of the money the extremely rich (like Cindy McCain) have stolen from the rest of us. You don't think the rich got rich by the sweat of their collective brow, do you? The work of ordinary people is what creates wealth - the rich use their power to keep more than their share of it.
That's why we wanta graduated income tax. Barack Obama wants to take some of that wealth back from the hands of the Wall Street financeers and corporate CEO's and give it back to the people whose actual 8 to 5 workday created it. Good old Joe the Plumber is too lacking in education to realize that he's just the one who would benefit from Obama's plan.
Redistribution of wealth looks good to me! It's the American way.
Even my dad, who fixed cars for a living, thought it was good citizenship - and a good thing - to pay taxes! It's the best way to buy what we need to run a country. But it should be fair. Don't let the Republicans fool you - they don't want you have your fair share. Barack does.
Redistribution of wealth has been that way for a long time?? Huh? Read what some of the framers and founders of our constitution had to say about that:
“When the people find that they can vote themselves money, that will herald the end of the republic.”
-Benjamin Franklin
“To take from one, because it is thought his own industry and that of his fathers has acquired too much, in order to spare to others, who, or whose fathers, have not exercised equal industry and skill, is to violate arbitrarily the first principle of association, the guarantee to everyone the free exercise of his industry and the fruits acquired by it.”
-Thomas Jefferson, letter to Joseph Milligan, April 6, 1816
So no it has not been that way for a long time.
Your Dad sounds like a good American and I agree with him, EVERYONE should pay taxes, and I do mean EVERYONE. But I disagree with your statement of
‘Our graduated income tax is proof that the American people do believe in redistribution of wealth’
I believe that everyone should pay their fair share to help pay for the freedom’s we have. The term ‘freedom isn’t free’ doesn’t just apply to our military; it applies to our way of life; and we simply can not have a cradle to grave economy; we have a history of people going to great links to immigrate; both legally and illegally to America for a better life for themselves; not to have a government give them everything.
We need to give people a ‘hand up’ not a ‘hand out’
Do you know how Cindy McCain’s family made their money... selling beer! Her Dad was the owner of Hensley & Co which he founded in 1955 with a loan of $10,000, From Wikipedia…
It originally had 15 workers, sold 73,000 cases of beer a year, and had a 6 percent market share. The company saw decades of steady growth, aided by the Phoenix area becoming one of the fastest-growing regions of the country while the company still maintained exclusivity with Anheuser-Busch Jim Hensley's tireless sales efforts and the generous wages and benefits he gave employees were also key success factors. Regarding technology, Hensley & Co. were the first Anheuser-Busch distributor to invest in refrigerated warehouses, which subsequently became standard in the industry. By 1970, Hensley & Co. had 20 percent market share; by 1980, that had grown to 50 percent, the business had become quite successful
Bad rich guy… started a business, grew it and give his employee’s generous wages and benefits, yeah let’s punish people like that.
And on the CEO ‘Golden Parachutes’; I completely agree they are WAY out of line; but it is NOT the CEO’s fault, it is the shareholders; THEY have to vote on those packages.
Below is our current tax rates; as you can see it is a base plus percentage system; meaning you pay X amount of taxes PLUS an additional % over a certain amount of income. Currently it tops out a $357,700 for both individuals and families filling joint returns, and they pay a base tax of X and an additional tax of 35%. Obama says he would hike taxes on people making more than $250,000, including the amount they pay on capital gains. Currently, the top income tax rate is 35 percent. Under Obama, that would go back up to 39 percent. So the max ceiling would drop from $357,700 to $250,000; believe me there are a ton more people making closer to $250k then there are to $357k. But again, why punish success and accomplishment? What is the incentive to get a head in life under Obama’s plan?
Why would I want to go from my present income and/or start a business and take my income over $250k, JUST to get taxed more?
Joe the plumber was right; taking money from the people who have worked hard and done good with the express purpose of giving to someone simply because they have a pulse is a socialism.
Table 1.–Federal Individual Income Tax Rates for 2008
If taxable income is: Then income tax equals:
Single Individuals
Not over $8,025.................................................................. 10% of the taxable income
Over $8,025 but not over $32,550...................................... $802.50 plus 15% of the excess over $8,025
Over $32,550 but not over $78,850.................................... $4,481.25 plus 25% of the excess over $32,550
Over $78,850 but not over $164,550.................................. $16,056.25 plus 28% of the excess over $78,850
Over $164,550 but not over $357,700 ............................... $40,052.25 plus 33% of the excess over $164,550
Over $357,700 ....................................................................
$103,791.75 plus 35% of the excess over
$357,700
Heads of Households
Not over $11,450................................................................ 10% of the taxable income
Over $11,450 but not over $43,650.................................... $1,145 plus 15% of the excess over $11,450
Over $43,650 but not over $112,650.................................. $5,975 plus 25% of the excess over $43,650
Over $112,650 but not over $182,400................................ $23,225 plus 28% of the excess over $112,650
Over $182,400 but not over $357,700................................ $42,755 plus 33% of the excess over $182,400
Over $357,700 .................................................................... $100,604 plus 35% of the excess over $357,700
Married Individuals Filing Joint Returns and Surviving Spouses
Not over $16,050................................................................ 10% of the taxable income
Over $16,050 but not over $65,100.................................... $1,605 plus 15% of the excess over $16,050
Over $65,100 but not over $131,450.................................. $8,962.50 plus 25% of the excess over $65,100
Over $131,450 but not over $200,300................................ $25,550 plus 28% of the excess over $131,450
Over $200,300 but not over $357,700................................ $44,828 plus 33% of the excess over $200,300
Over $357,700 .................................................................... $96,770 plus 35% of the excess over $357,700
Exactly. You've made our point. Benjamin Franklin and Thomas Jefferson were of another time and place - but they didn't believe in inherited wealth, so I suspect (but can't prove) that they would approve of where America has come with her graduated income taxes and inheritance taxes. And with our tax laws that reward the wealthy for charitable contributions. Our best "capitalists" have always recognized the importance of "redistributing" their wealth - Andrew Carnegie, the Rockerfeller foundations, the Annenburg Challenge, Bill Gates foundations. It's not good for American democracy to have a permanent wealthy class where power is concentrated, so we have always had checks and balances within our laws that worked against the tendency for some families and individuals to hold a disproportionate amount of the wealth. So when you acknowledge the existence of our graduated income tax system, you make my point. For a long time Americans have believed that the wealth of society wasn't the product of just individuals who by birth, skill, or luck became rich. Wealth is produced by the workers of the country. Those people who worked in the Hensley's brewery deserve a share in the success of the company. That may smack of socialism, but unfettered capitalism doesn't work. We've discovered that.
p.s. You asked, "Why would I want to go from my present income and/or start a business and take my income over $250k, JUST to get taxed more?"
My answer: Because you get to keep the rest of it! Just as you did before Bush put those tax cuts into effect. Did the economy get BETTER after those tax cuts? Not from what I see. But if people who make less than $250,000 can pay their mortgages and buy more cars, then we all benefit, right?
p.s. here's an interesting website regarding the gap between rich and poor and the place of inherited wealth in that spreading distance between the two extremes:
http://blogs.wsj.com/wealth/2008/01/14/the-decline-of-inherited-money/
Wikipedia has an interesting article on Progressive taxation.
http://en.wikipedia.org/wiki/Progressive_taxation
I think one of the key things you are missing with your references to Rockefeller, Gates and others is the fact that THEY choose who was to benefit from their charity. It wasn’t mandated on them from the government; or based on a certain income dollar amount; but given away based on their own sense of right and wrong and their desire to give someone a hand up as opposed to a hand out.
I think some quotes from good ole Abe Lincoln are appropriate here:
• You cannot help the poor by destroying the rich.
• You cannot strengthen the weak by weakening the strong.
• You cannot bring about prosperity by discouraging thrift.
• You cannot lift the wage earner up by pulling the wage payer down.
• You cannot further the brotherhood of man by inciting class hatred.
• You cannot build character and courage by taking away men’s initiative and independence.
• You cannot help men permanently by doing for them, what they could and should do for themselves.
Again, wealth is relative; if you’re making $15,000 a year; then you think someone making $30,000 is wealthy, and so on.
I will give you there are ‘bad apples’ on Wall Street and in the business sector; but to simply pick a dollar amount such as $250K and call that wealthy is incredibly short sighted; because what’s to stop that dollar amount from being lowered?
NebraskaVoice: there has always been a cut-off point. All Obama is doing is to raise it since it no longer reflects the realities of today's economy. The principle is the same whether the cut-off is $100K or $150K or $250K.
There were different rules in force before the "temporary" tax cuts were made under Bush. They are expiring. Do we want to go back to Bush's plan which increased the volume of money held by the top 1%? Or do we want to go back to the previous rules?
Bascially Obama's plan only takes away cuts that were made under Bush, whose economic policies have brought us to disaster. And he has protected the middle-class from the impact by keeping those tax cuts in place for them, and expanding the definition of the middle-class by raising the bar to $250,000.
So you're arguing two different things here. Unbridled capitalism which no one realistically advocates any more. Or which set of guidelines should be applied.
Don't you see that? The gap between the poor and the rich has grown so egregiously, that basically the middle class is being shoved down to the poverty level. That's what Obama's plan would change. It's Joe the Plumber, and Mary the teacher, and Sally the social worker and you, my friend, unless you're at the top lf the ladder, which is unlikely since that pool isn't very large, would would get to keep "more of YOUR money" while Exxon wouldn't bloat with profits and Wall Street wouldn't throw wild parties at California spas that cost more than your whole neighborhood lives on in a year.
Think! think! Don't be fooled by the party of the wealthy who want to keep the fruits of your labor in their pockets.
Again, you can not lay the whole economic issue at the foot of Bush; this ball started rolling with Carter with the CRA. Which was changed under the Clinton administration, and it was the Bush Administration who tried to head this off in 2003; but Barney Frank and others stop them. See this post:
http://nebraskavoice.blogspot.com/2008/10/truth-behind-housing-meltdown.html
Regarding your statement of:
The gap between the poor and the rich has grown so egregiously, that basically the middle class is being shoved down to the poverty level.
Tell me whose fault is that? Is it Joe the plumber that has been working hard his whole life and has an opportunity to achieve a life long dream of owning his own business? Or is it the individual’s who have always dependent on the government for a hand out and isn’t motivate enough to get ahead. Don’t you get that this is America and EVERYONE can get above their raisen. Obama is a testament to that, look at where he started and where he is.
Or are you really going to tell me that it is the amount of taxes someone is paying OR not paying that is making them rich or poor? Huh? That makes no sense, taxes will not make are break anyone.
Redistribution of wealth is just another name for more welfare and we already have too much of that, along with section 8, food stamps, Medicaid, Pell grants and so on.
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