Republican Axioms - Taxes.

Discussion in 'Politics' started by Baruch Menachem, Jul 12, 2010.

  1. Baruch Menachem
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    Baruch Menachem '

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    I am going to make a bunch of threads, unless a mod stops me on this on what Republicans think of as obvious that Democrats seen not to understand. I am not bashing Democrats here. I am sure I could get a response at the same level where Republicans seem outrageously obtuse to the democrats here.

    Rule 1 on taxes is that they are a price and subject to marginal revenue constraints. Even if they are a monopoly price, they still follow the basic rules of a price.

    That is, as taxes increase, people respond to the rates in various ways. They evade, they do things or don't do things in order to to make for their own personal best interest, and that means they will do things to lower the tax bill even if it lowers income.

    I grew of age in the 70s when high marginal taxes reached into the upper levels of union worker income. YOu started seeing things like where wages went up, bad behavior by workers also went up, IE, absenteeism, and refusal of overtime beause taxes would eat up all the money you earned over a certain amount and then some.


    People began dropping out of the economy and going back to nature in a big way. Earning cash was counter productive.

    So over a certain level, higher taxes not only do not increase revenue, they harm the economy by making people not want to engage in taxable activity.

    after a point, the deficit in irrelevant to tax discussion, as raising the taxes to cover the deficit, wont.

    So taxes need to be at a place where economic activity is maximised. (Not necessarily government revenue, as with compounding, governments get better revenue with higher economic performance than with cash in hand)
     
  2. Avatar4321
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    Avatar4321 Diamond Member Gold Supporting Member

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    This is precisely why we need to cut spending in order to control deficits.
     
  3. NYcarbineer
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    NYcarbineer Diamond Member

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    I worked a union job in the 70's paying VERY high wages and that is pure bullshit.
     
  4. Mr Clean
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    Mr Clean Gold Member

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    It's almst like the whole concept of taxation just magically appeared in January 2009.
     
  5. Avatar4321
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    Avatar4321 Diamond Member Gold Supporting Member

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    That's a silly straw man. We've been overtaxed since Woodrow Wilson was in office.

    And it's precisely that we can look at the cause an effect of taxation on economics through history that allows us to know with certainty the effect on economies.
     
  6. Modbert
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    Modbert Daydream Believer Supporting Member

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    Federal taxes are at their lowest levels at 60 years. People bitching about federal taxes obviously need to reexamine things. If they're complaining about state taxes, then they obviously have no idea what they're talking about if they're blaming Obama or Congress.
     
  7. Mr Clean
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    Mr Clean Gold Member

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    And all of a sudden, now that we have Democrats running things, taxation is suddenly a problem.
     
  8. Avatar4321
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    Avatar4321 Diamond Member Gold Supporting Member

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    What part of "We've been overtaxed since Woodrow Wilson" is difficult to understand?
     
  9. MaggieMae
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    MaggieMae Reality bits

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    The premise is good, and maybe we'll get to a level playing field someday. But the purpose of taxes isn't to increase revenues (like a savings account), they're to pay for the programs government establishes. I'm really really anxious to hear the analysis of the deficit commission's findings. They've already hinted that major cuts in entitlements must happen, as well as tax increases. It's gonna be a rough road ahead, boys and girls.
     
  10. MaggieMae
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    MaggieMae Reality bits

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    I made most of my money in the 70's, too, and never turned down overtime nor bonuses. One year I did turn down a raise, though, because it would have put me in a higher tax bracket so I talked the bosses into leasing me a car instead (and they could take the tax deduction). Win-win!!
     

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