Shifting the tax burden to the wealthy class does NOT harm the economy

[g5000]

The MID is paid for by higher tax rates and higher house prices.

Who benefits from higher house prices?

Bankers who lend the money, real estate agents, and home builders.

And that is how the MID is a massive transfer of wealth from the common man up the food chain. That money you think you are keeping in your pocket is zeroed out by higher tax rates and higher home prices, all to make rich people richer.

Reagan was right to try to eliminate it.

 

[g5000]

I was just speaking to a US Senate staffer this morning who was caught off guard and impressed by how well informed I was about the tax expenditure scam.

 

[g5000]

If he is making 100 million a year he WOULD be paying the 90% rate on income ABOVE a certain level.
But his taxes are indeed progressive as his income goes up the scale.
The more he makes the more he pays in taxes ( unless he is a cheating Republican ).

This is exactly why taxes on consumption are superior to taxes on production.

If you knew the next $100,000 you would earn would only net you $10,000, then you won't bother. A 90 percent tax makes people LESS productive. Only a retard believes a 90 percent top tax bracket makes people more productive.

The more you tax something, the less of it you get. So tax consumption, not production.

 

[mikegriffith1]

How many times does this myth have to be debunked? Seriously? Before you run with this stuff, does it ever occur to you guys to do some fact-checking, maybe like break down and read the other side?

Now, in the '50s and early '60s, there was no Medicare tax, no needlessly costly EPA regs, no needless costly OSHA regs, and there were huge loopholes for the rich as well so they could shield much of their money from confiscatory taxation.

Do you know who else believed in taxing the rich at sky-high rates? Stalin, Lenin, Castro, Mao, and so forth. How'd that work out?

 

[g5000]

If he had 100 million dollars a year coming in from his factory, and the government lets him keep 10 million, he has LOTS of motivation to expand his operations and start more.

If a producer will only net $10,000 out of his next $100,000 of income, he has NO motivation to bother. You have it exactly backwards.

 

[Arizona Willie]

Your response went into crazy land when you said the government raises EVERYONE'S RATE.

It doesn't work that way and you know it.

It takes an act of Congress to raise rates and Congressmen don't do that easily so we wind up running deficits because people aren't paying enough.

Yes the government, on one hand, does use tax policy to encourage people to do some things such as buying an energy efficient refrigerator or windows. Because it saves more in the long run than it costs in the short run.

And, in this country, it was decided long ago that PROGRESSIVE taxes were the only FAIR way to go and not everyone with the same income does or should owe the same amount of taxes.

We also give tax deductions for children which is just as bad, or worse, in some senses than giving one for energy saving home modifications.

YOUR Congressmen are the one's responsible and the Republicans have dominated Congress for quite a few years. There were a couple where Dems had a TECHNICAL majority but that was because of the Blue Dog Democrats who are actually southern Republicans who run as Democrats.

Would you mind explaning ( show your work ) how the mortgage interest deduction transfers money from me to a multi-millionaire?

I've done it countless times on this forum.

An allegory:

Bernie and Ted earn identical incomes.

Bernie and Ted's fair share of the federal budget is $1000. This means Bernie and Ted are each responsible for $500 at tax time.

But wait! Ted bought the right kind of refrigerator the government wanted him to buy. He gets a tax deduction! Ted also bought other government-approved products. Because that is what tax expenditures are: A massive government behavioral control program.

Ted's tax burden is now $400 instead of $500, thanks to tax expenditures awarded to him. "Woo hoo!", exclaims Ted, "I get to keep more of my own money!"

But Ted is wrong.

Since the federal tax burden for Ted and Bernie is $1000, and Ted is only paying $400 and Bernie is paying $500, tax revenues are going to come up $100 short. There will be a $100 deficit due to Ted's tax expenditures.

What to do...what to do...

So the government raises everyone's tax rates by 5 percent.

Now Bernie owes $525, and Ted owes $425 ($525 - $100 deduction).

Has Ted really saved $100? Nope. His taxes are only $75 lower now, and Bernies are $25 more. And their total tax payment is still $50 short of the goal of $1000.

After the 5% tax hike, Ted's $100 deduction is paid for by each of them paying $25 more, plus a $50 deficit.

And that is how our current tax structure is actually managed, boys and girls. We have this ridiculous system whereby two people earning identical incomes pay radically different taxes, and we have a budget deficit. And everyone's tax rates are higher than they would be.

And the rube with the deductions isn't getting as much as he thinks he is.

Now along comes a deficit hawk who wants a balanced budget. And so taxes are raised 10%.

Now Bernie is paying $550 instead of the original $500. And Ted is paying $450 (after taking out his deduction).

We now have a balanced budget. But look. Ted's $100 deduction has really only netted him $50. And where did that $50 come from? It came out of Bernie's pocket!

And this is why tax expenditures are no different than food stamps or Obamaphones. Someone else has to pay for them with higher tax rates. And you aren't making out as much as you think you are.

But wait! It gets worse!

http://www.taxpolicycenter.org/Uplo...erest-Deduction-Affect-the-Housing-Market.pdf

One widely cited 1996 study by Dennis Capozza, Richard Green, and Patric Hendershott estimated that eliminating the mortgage interest and property tax deductions would reduce housing prices in the short term by an average of 13 percent nationwide, with regional changes ranging from 8 to 27 percent.

Mortgage Interest Deduction: $484 billion

The MID cost taxpayers $484 billion between 2010-2014.

Guess how much the budget deficit was for 2014?

$483 billion.

And that is just ONE tax expenditure, kids.

The Real Estate special interests spent $26,723,151 on House campaign contributions, $11,255,447 on Senate campaign contributions, and $95,563,540 on lobbying in 2014, for a total of $133,542,138.

They didn't spend that money for nothing, boys and girls. It netted them a profit of $96 billion, every penny of which came out of YOUR pockets.

 

[Arizona Willie]

Nope, he still has to pay the upkeep on the mansion and yachts just like you have to keep paying your house payment.

And, once again, you don't understand illustration of principles and want to make take everything literally.

==========

If he had 100 million dollars a year coming in from his factory, and the government lets him keep 10 million, he has LOTS of motivation to expand his operations and start more.

If a producer will only net $10,000 out of his next $100,000 of income, he has NO motivation to bother. You have it exactly backwards.

 

[bedowin62]

Your response went into crazy land when you said the government raises EVERYONE'S RATE.

It doesn't work that way and you know it.

It takes an act of Congress to raise rates and Congressmen don't do that easily so we wind up running deficits because people aren't paying enough.

Yes the government, on one hand, does use tax policy to encourage people to do some things such as buying an energy efficient refrigerator or windows. Because it saves more in the long run than it costs in the short run.

And, in this country, it was decided long ago that PROGRESSIVE taxes were the only FAIR way to go and not everyone with the same income does or should owe the same amount of taxes.

We also give tax deductions for children which is just as bad, or worse, in some senses than giving one for energy saving home modifications.

YOUR Congressmen are the one's responsible and the Republicans have dominated Congress for quite a few years. There were a couple where Dems had a TECHNICAL majority but that was because of the Blue Dog Democrats who are actually southern Republicans who run as Democrats.

Would you mind explaning ( show your work ) how the mortgage interest deduction transfers money from me to a multi-millionaire?

I've done it countless times on this forum.

An allegory:

Bernie and Ted earn identical incomes.

Bernie and Ted's fair share of the federal budget is $1000. This means Bernie and Ted are each responsible for $500 at tax time.

But wait! Ted bought the right kind of refrigerator the government wanted him to buy. He gets a tax deduction! Ted also bought other government-approved products. Because that is what tax expenditures are: A massive government behavioral control program.

Ted's tax burden is now $400 instead of $500, thanks to tax expenditures awarded to him. "Woo hoo!", exclaims Ted, "I get to keep more of my own money!"

But Ted is wrong.

Since the federal tax burden for Ted and Bernie is $1000, and Ted is only paying $400 and Bernie is paying $500, tax revenues are going to come up $100 short. There will be a $100 deficit due to Ted's tax expenditures.

What to do...what to do...

So the government raises everyone's tax rates by 5 percent.

Now Bernie owes $525, and Ted owes $425 ($525 - $100 deduction).

Has Ted really saved $100? Nope. His taxes are only $75 lower now, and Bernies are $25 more. And their total tax payment is still $50 short of the goal of $1000.

After the 5% tax hike, Ted's $100 deduction is paid for by each of them paying $25 more, plus a $50 deficit.

And that is how our current tax structure is actually managed, boys and girls. We have this ridiculous system whereby two people earning identical incomes pay radically different taxes, and we have a budget deficit. And everyone's tax rates are higher than they would be.

And the rube with the deductions isn't getting as much as he thinks he is.

Now along comes a deficit hawk who wants a balanced budget. And so taxes are raised 10%.

Now Bernie is paying $550 instead of the original $500. And Ted is paying $450 (after taking out his deduction).

We now have a balanced budget. But look. Ted's $100 deduction has really only netted him $50. And where did that $50 come from? It came out of Bernie's pocket!

And this is why tax expenditures are no different than food stamps or Obamaphones. Someone else has to pay for them with higher tax rates. And you aren't making out as much as you think you are.

But wait! It gets worse!

http://www.taxpolicycenter.org/Uplo...erest-Deduction-Affect-the-Housing-Market.pdf

One widely cited 1996 study by Dennis Capozza, Richard Green, and Patric Hendershott estimated that eliminating the mortgage interest and property tax deductions would reduce housing prices in the short term by an average of 13 percent nationwide, with regional changes ranging from 8 to 27 percent.

Mortgage Interest Deduction: $484 billion

The MID cost taxpayers $484 billion between 2010-2014.

Guess how much the budget deficit was for 2014?

$483 billion.

And that is just ONE tax expenditure, kids.

The Real Estate special interests spent $26,723,151 on House campaign contributions, $11,255,447 on Senate campaign contributions, and $95,563,540 on lobbying in 2014, for a total of $133,542,138.

They didn't spend that money for nothing, boys and girls. It netted them a profit of $96 billion, every penny of which came out of YOUR pockets.

Republicans have "dominated Congress" for almost 8 MONTHS, not "quite a few years". idiot

 

[bedowin62]

Nope, he still has to pay the upkeep on the mansion and yachts just like you have to keep paying your house payment.

And, once again, you don't understand illustration of principles and want to make take everything literally.

==========

If he had 100 million dollars a year coming in from his factory, and the government lets him keep 10 million, he has LOTS of motivation to expand his operations and start more.

If a producer will only net $10,000 out of his next $100,000 of income, he has NO motivation to bother. You have it exactly backwards.

every time a left-wing idiot cant make his case; in this example a guy getting schooled by somebody i dont always get along with, g5000, the left-winger starts crying "you dont understand"

 

[ClosedCaption]

No you dont understand. All of us should be happy the burden is shifted to us because if it was the other way around it would be wealth redistribution. AND the rich wouldnt be uber happy and its good for all of us to make sure they have all they need and get a belly rub.

 

[bedowin62]

there are almost no Blue Dog Dems left Willie; stop embarrassing yourself telling yourself lies

 

[bedowin62]

when there are no more left-wing gazillionaires left, having given all their fortunes away leading by example; i'll stop laughing at left-wing nutjobs on these boards

 

[Londoner]

Supply Side economics holds that by lowering the labor, tax, and regulatory burden of capital investment, we will see increased investment and hence greater economic growth.

Here's the problem. Suppliers also requires consumers - and consumers need sufficient wages to consume.

Reagan - the first president to fully use Supply Side economics - convinced us to reduce Union power and lower wages across the board so that our suppliers had more incentive to invest.

This created a huge initial shortfall in consumer demand, which was reflected in a crisis of overproduction. Reaganomics solved the problem by radically expanding credit so that hard working, cash-strapped families could borrow more and more money to continue purchasing what the capitalist was selling.

The result of Reagan's credit-based democracy or democracy-by-debt was an initial explosion of economic growth. We converted factories with high paying jobs into shopping malls filled with indebted credit-card shoppers. Americans no longer saved money. They went into debt so that the wealthiest Americans could live the corporate dream of low labor costs, subsidies and bailouts. FDRs Brownshirts were replaced by Reagan's lobbying industrial complex: corporations now own government. (This was the Reagan's goal. To put big business in charge of the economy. This is why Chaney put big oil in charge of writing energy regulations, and Goldman Sachs in charge of financial regulations. It's why Halliburton staffed the vice presidency and Wall Street staffs the Federal Reserve. Make no mistake: business rules this nation, yet they like to blame government for everything. Problem is: they own government.)

It took 30 years, but Reaganomics finally destroyed FDRs middle class with debt. Now the American consumer can't borrow enough in the aggregate to grow the economy. Things got so bad that we had to hawk the last thing left with any values, our homes.

When the system ran out of solvent borrowers, we started lending money to insolvent, jobless, non-creditworthy borrowers. We did anything and everything to avoid raising wages and benefits - we did anything to keep the economy going on credit.

And now we are lying in that bed. The capitalist has cheap labor but the middle class is dead.

Bad things happen to economies that try to replace wages/benefits with credit & subprimes.

America swallowed poison in 1980.

 

[bedowin62]

Supply Side economics holds that by lowering the labor, tax, and regulatory burden of capital investment, we will see increased investment and hence greater economic growth.

Here's the problem. Suppliers also requires consumers - and consumers need sufficient wages to consume.

Reagan - the first president to fully use Supply Side economics - convinced us to reduce Union power and lower wages across the board so that our suppliers had more incentive to invest.

This created a huge initial shortfall in consumer demand, which was reflected in a crisis of overproduction. Reaganomics solved the problem by radically expanding credit so that hard working, cash-strapped families could borrow more and more money to continue purchasing what the capitalist was selling.

The result of Reagan's credit-based democracy or democracy-by-debt was an initial explosion of economic growth. We converted factories with high paying jobs into shopping malls filled with credit-card shoppers. Americans no longer saved money. They went into debt so that the wealthiest Americans could live the corporate dream of low labor costs, subsidies and bailouts. FDRs Brownshirts were replaced by Reagan's lobbying industrial complex: corporations now own government.

It took 30 years, but Reaganomics finally destroyed FDRs middle class with debt. Now the American consumer can't borrow enough in the aggregate to grow the economy. Things got so bad that we had to hawk the last thing left with any values, our homes.

When the system ran out of solvent borrowers, we started lending money to insolvent, jobless, non-creditworthy borrowers. We did anything and everything to avoid raising wages and benefits - we did anything to keep the economy going on credit.

And now we are lying in that bed. The capitalist has cheap labor but the middle class is dead.

Bad things happen to economies that try to replace wages/benefits with credit & subprimes.

America swallowed poison in 1980.

such moronic stupidity. When really WHEN is the Left ever going to take responsibility for ANYTHING?

still ranting bout the dead dude that so many Democrats in Congress voted to support his policies the term Reagan Democrat was coined to refer to them?

FOR THE SAKE OF ARGUMENT. let's just assume everything you just posted is the absolute truth; when are you losers going to own up to the fact you cant get people to believe in this superior ideology and economic policy you Progressives say you have in mind???

 

[peach174]

Giving Washington more money is like buying a drunk a drink. First the President and congress must show they can say "no" and control spending.

Yep, defense spending is out of control.

While you ignore the ones that are even higher.

 

[bedowin62]

Again; for the sake of arguemnt let's say left-wingers get their wish to downsize the military like they insist we so desperately need to. Would a nice high-paying union job be waiting for all the people put out of work by drastic cuts to defense corporations? oh WAIT!! many of those defense-related jobs already ARE high-paying union wages! how about the soldiers, sailors, marines and airmen put out of a job?

and that's not even considering the whole global security portion of it.

libs are losers who lie to themselves

 

[2aguy]

"Contrary to what Republicans would have you believe, super-high tax rates on rich people do not appear to hurt the economy or make people lazy: During the 1950s and early 1960s, the top bracket income tax rate was over 90%--and the economy, middle-class, and stock market boom."

THE TRUTH ABOUT TAXES: High Rates On Rich People Do Not Hurt The Economy - Business Insider

The true driving force of the economy is the middle class - not the wealthy. This economy depends on consumer spending. That is why you all should care about income inequality. Despite productivity skyrocketing over the previous decades, wages have remained mostly flat in the lower class and most of the income gains have gone to the top 1%.. The middle class is shrinking and the U.S. has the worst child poverty rate in the developed world.

Wealth And Inequality In America - Business Insider

To sustain a 90% tax bracket this is the formula....first, destroy the industrial base of every other country in the world and decimate their populations. Second) raise your own taxes to 90%.........

And then Kennedy lowered the tax rate and the economy boomed.....and then Reagan did it and the economy boomed.....

If the middle class is suffering, it is because they are being taxed to death....nickle and dimed but taxed for every last thing they do....and the rich can absorg the taxes and fees, the middle class can't...

Cut government spending, cut taxes for everyone....and the economy will boom again.

 

[2aguy]

When the American economy was rockin' and rollin' back in the 60's and 70's we had a top tax rate on the wealthy of 91% and a 10% usery law that prevented charging more than 10% interest.

The peasants were also allowed to deduct 100% of the interest they paid on everything on their income taxes both state and federal.

Until Ronald Reagan created the largest tax increase on the middle class in history when he took the interest deduction away, except for your home mortgage -- and he WANTED to take that away too.

Having a high tax rate on the uber wealthy serves two purposes.

1) It raises more money to pay down the country's debt -- thanks to Bush's Follies.

2) It motivates the wealthy to use their remaining money to start more businesses and expand the one's they own in order to get more money.

If a man has 100 million dollars rs a year coming in from his factory, and the government lets him keep 92 million, he has little motivation to expand his plant or start another business.

If he had 100 million dollars a year coming in from his factory, and the government lets him keep 10 million, he has LOTS of motivation to expand his operations and start more.

He still owns his yacht and mansions and now needs more money to KEEP them just like his employees need to make money to pay their rent / house payment.

He's still a rich man, nobody took his factory away from him, but with a high tax rate he pays more to society for the better life he is receiving from society. And that helps society.

Proof of my statement is that when we HAD high tax rates on the wealthy ... they DID expand their businesses and start more. Times were booming.

But, since Reagan and the massive give aways to the wealthy under the pretense it would create more jobs ( which has been proven untrue ) we have cut the taxes on the wealthy and they just hide their money overseas and sit on their wealth.

The conservatives claim that giving welfare to the poor encourages them not to work.

Well, tax cuts for the rich are the same thing as welfare to the poor --- only it's welfare for the RICH.


===============

It's kind of weird how good it was then and now how bad it is today since the rich have been getting away with this crap.

We spent far more on infrastructure, science, r&d and education when we had the revenue to do so.

 

[HereWeGoAgain]

If he is making 100 million a year he WOULD be paying the 90% rate on income ABOVE a certain level.
But his taxes are indeed progressive as his income goes up the scale.
The more he makes the more he pays in taxes ( unless he is a cheating Republican ).

The numbers I used were not meant to be literal but to show the general principle and I think most people were smart enough to understand that.

And then there's g5000.

Oh well

============

If a man has 100 million dollars rs a year coming in from his factory, and the government lets him keep 92 million, he has little motivation to expand his plant or start another business.

If he had 100 million dollars a year coming in from his factory, and the government lets him keep 10 million, he has LOTS of motivation to expand his operations and start more.

That is not how a 90 percent top tax rate works, bozo.

If someone ripped me off they way you describe? I'd just say **** it and shut down the business,whats the point.
And the stock holders might be a problem as well.
Who the hell is going to invest in a company with no return?

 

[2aguy]

When the American economy was rockin' and rollin' back in the 60's and 70's we had a top tax rate on the wealthy of 91% and a 10% usery law that prevented charging more than 10% interest.

The peasants were also allowed to deduct 100% of the interest they paid on everything on their income taxes both state and federal.

Until Ronald Reagan created the largest tax increase on the middle class in history when he took the interest deduction away, except for your home mortgage -- and he WANTED to take that away too.

Having a high tax rate on the uber wealthy serves two purposes.

1) It raises more money to pay down the country's debt -- thanks to Bush's Follies.

2) It motivates the wealthy to use their remaining money to start more businesses and expand the one's they own in order to get more money.

If a man has 100 million dollars rs a year coming in from his factory, and the government lets him keep 92 million, he has little motivation to expand his plant or start another business.

If he had 100 million dollars a year coming in from his factory, and the government lets him keep 10 million, he has LOTS of motivation to expand his operations and start more.

He still owns his yacht and mansions and now needs more money to KEEP them just like his employees need to make money to pay their rent / house payment.

He's still a rich man, nobody took his factory away from him, but with a high tax rate he pays more to society for the better life he is receiving from society. And that helps society.

Proof of my statement is that when we HAD high tax rates on the wealthy ... they DID expand their businesses and start more. Times were booming.

But, since Reagan and the massive give aways to the wealthy under the pretense it would create more jobs ( which has been proven untrue ) we have cut the taxes on the wealthy and they just hide their money overseas and sit on their wealth.

The conservatives claim that giving welfare to the poor encourages them not to work.

Well, tax cuts for the rich are the same thing as welfare to the poor --- only it's welfare for the RICH.


===============

It's kind of weird how good it was then and now how bad it is today since the rich have been getting away with this crap.

We spent far more on infrastructure, science, r&d and education when we had the revenue to do so.

Watch shark tank.....they are billionaires and building businesses is what they do.......they could retire and never work a day in their lives...and they put in more hours than 10 democrats on welfare.........

Raising taxes does not create jobs or help anyone...