Payroll ‘Tax Cut’ Paid For By Mortgage Hike

Discussion in 'Politics' started by Stephanie, Dec 21, 2011.

  1. Stephanie
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    Stephanie Diamond Member Supporting Member

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    Sweetness and light adds their own commentary in the articles, but this explains a lot..

    SNIP:
    December 21st, 2011
    From, of all places, the Associated Press:


    Payroll tax cut bill boosts cost of new mortgages
    By ALAN FRAM | AP – Sat, Dec 17, 2011

    WASHINGTON (AP) — Who is paying for the two-month extension of the payroll tax cut working its way through Congress? The cost is being dropped in the laps of most people who buy homes or refinance beginning next year.
    The typical person who buys a $200,000 home or refinances that amount starting on Jan. 1 would have to pay roughly $17 more a month for their mortgage, thanks to a fee increase included in the payroll tax cut bill that the Senate passed Saturday. The White House said the fee increases would be phased in gradually…

    And never mind that will the current price of houses, most mortgages would probably be for twice that amount, if not more.

    Two more months of the Social Security tax cut amounts to a savings of about $165 for a worker making $50,000 a year.

    Which is just going to make the economy skyrocket and employers start hiring like mad.

    Meanwhile, the payroll tax — which is not even really a tax, but a contribution to your Social Security and Medicare insurance — is the only "tax" that almost half of the country pays to the federal government. (Since 47% pay no income tax at all.)

    So what this really comes down to is Obama and the Democrats want people who are hardworking and responsible enough to qualify for a mortgage these days to pay for the Social Security and Medicare for their constituents.

    the rest at.
    http://sweetness-light.com/archive/payroll-tax-cut-paid-for-by-mortgage-hike
     
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    Last edited: Dec 21, 2011
  2. The T
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    The T George S. Patton Party Supporting Member

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    Doing all they can to bring the economy down, aren't they?

    I don't want to hear anyone on the left bitch about the housing market and what the left in the Congress has done to it.

    Bawney Fwank is leaving at an oppertune time, isn't he?
     
  3. WillowTree
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    WillowTree Diamond Member

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    Well the good news is that some of the younger people realize the demoncrats are destroying social security and are making plans for their future. That's the good news.
     
  4. The T
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    The T George S. Patton Party Supporting Member

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    At least the ones that haven't bought the Statist line indoctrination in Gubmint schrools.
     
  5. Trajan
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    Trajan conscientia mille testes

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    they also increasing the MIP, or in common terms mortgage insurance % for FHA backed loans. it was .55% in april, went to 1.05% in august now is 1.55%....the idiots are shooting themselves in the foot. no one will refi into an fha loan at that %.
     
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  6. Stephanie
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    Stephanie Diamond Member Supporting Member

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    Where are all the libs on the board crowing about their dear leaders tax cuts.??

    seems to be avoiding this thread like a plague..
     
  7. Wiseacre
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    Wiseacre Retired USAF Chief Supporting Member

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    Hard to understand why we would want to increase the costs of buying or refinancing a home at a time when we need more homebuyers to get the housing industry on their feet. It's only for Fannie, Freddie, and FHA loans, IOW gov't backed loans, which begs the question: will buyers avoid those lenders, will they much choice, and if they do how much less revenue will we get than expected? This has pure stupidity written all over it.
     
  8. ladyliberal
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    ladyliberal Progressive Princess

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    Either you haven't been following the payroll tax debate closely, or you are trying to deliberately mislead people. Democrats proposed raising taxes on millionaires (or, if you prefer, partially undoing the Bush tax cut for them) in order to pay for the payroll tax cut:
    Democrats weigh dropping millionaire tax proposal - Yahoo! News

    The change to raising revenue via fees rather than taxes was added in order to achieve Republican support (which it did, in the Senate). Indeed, the notion of revenue through fees rather than taxes is associated with conservatives.

    "Sweetness and Light" have their facts wrong:

    They say that the payroll tax isn't a real tax. This is, of course, untrue.

    They say "And never mind that will the current price of houses, most mortgages would probably be for twice that amount, if not more." This is ungrammatical, but it is hard to imagine a plausible scenario where something would be doubling during the time period affected by the fees.

    They say that the payroll tax is the only federal tax that about half of Americans pay. They seem to have pulled that number out of thin air by assuming that everyone pays payroll taxes. Of course, some people don't pay either payroll or income taxes, so actually about 34% of people pay payroll taxes but not income taxes (Who Pays Taxes? Not As Many As You Think : NPR). And about 0% of people pay *only* payroll taxes, since almost everyone pays federal excise taxes.

    They say exactly 0% of mortgages won't be affected by this rate increase. Fox News says about 10% won't be affected (Mortgage Fees Would Rise Under Payroll Tax Cut Deal | Fox News), the 10% which don't rely on the federal subsidies. Indeed, this fee increase is not a net tax on mortgages but rather a reduction in the current federal subsidy.

    They suggest that this rise in fees is similar in some sense to what caused the economic meltdown. In fact, the meltdown, complex as it was, owed more to over-subsidizing mortgages than under-subsidizing them.

    I'm not sure what value Sweetness and Light is adding here. They took an AP story with zero factual inaccuracies, and added mostly factually inaccurate statements, along with some editorializing.
     
  9. Wiseacre
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    Wiseacre Retired USAF Chief Supporting Member

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    Well, you can parse it out anyway you want to, say whatever you like, but the end result is that extending the payroll tax cut is going to cost around $150 billion. And the way they want to pay for it will add that much in aggregate costs to buy or refi a home. That's crazy, you don't want to do anything to hurt housing sales at a time like this.
     
  10. 8537
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    8537 Senior Member

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    Republicans had a choice: Pay for it via additional fees on government-sponsored mortgages to middle income folks or via a small increase in taxes for the top 1%.

    They chose the mortgage fees.
     

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