Should the Republican Congress send a balanced budget amendment to the States?

[bripat9643]

Democrats are responsible since almost all the spending goes to Democrat created social programs and Democrats fight tooth and nail to prevent any cuts in the budget.

A completely bogus statement.

$1.2 trillion of spending goes to tax expenditures, many of which were put there and are defended by Republicans.

A mortgage interest deduction is no different than a food stamp, and it costs megatons more than food stamps. As does the employer-sponsored health insurance income exemption.

So-called "tax expenditures" are not government spending. Allowing you to keep your income isn't a government expense, that is, unless you buy they notion that all your income belongs to the government.

 

[nodoginnafight]

Democrats are responsible since almost all the spending goes to Democrat created social programs and Democrats fight tooth and nail to prevent any cuts in the budget.

A completely bogus statement.

$1.2 trillion of spending goes to tax expenditures, many of which were put there and are defended by Republicans.

A mortgage interest deduction is no different than a food stamp, and it costs megatons more than food stamps. As does the employer-sponsored health insurance income exemption.

Agree - it's all about getting your hand into the goody bag. Everyone has their own rationalization as to why they "DESERVE" some of the goodies.

 

[g5000]

Republicans like to pretend their handouts are "getting to keep more of your own money", but that is a lie.

Did I call it, or what?

So-called "tax expenditures" are not government spending. Allowing you to keep your income isn't a government expense, that is, unless you buy they notion that all your income belongs to the government.

 

[g5000]

Tax expenditures are spending, and they are paid for by higher tax rates and borrowing. Simple fact.

 

[EdwardBaiamonte]

This isn't 1995 nor is it the Gingrich Congress. The Republicans have had plenty of opportunities to try it again, particularly when they controlled both Houses of Congress and the White House for six years during the Bush Administration. Instead, they doubled the national debt and have continued to give Obama budgets with deficits of hundreds of billions of dollars.

so what?? if it was a politicially viable idea(after Newt) Republican politicians would have appeared to support it, obviously. What is certain is that Republicans have tried 30 times since Jefferson to end the madness while Democrats have opposed 30 times in favor of continuing the madness.

Democrats know they are doomed if ever the day comes when they have to tax enough to pay for their subversive, crippling welfare entitlement programs!

 

[Wry Catcher]

.

I happen to be a firm believer in requiring our federal government to balance the budget on an annual basis. To not do so opens the door to accumulating a massive federal debt, as has happened, depriving our nation’s younger generation of their economic liberty in that they are now in debt to the tune of $127 Trillion! See You Think The Deficit Is Bad? Federal Unfunded Liabilities Exceed $127 Trillion

My personal choice for a balanced budget amendment is following what our Founders intended, and is reflected in the FAIR SHARE BALANCED BUDGET AMENDMENT which follows.


The Fair Share Balanced Budget Amendment


“SECTION 1. The Sixteenth Amendment is hereby repealed and Congress is henceforth forbidden to lay ``any`` tax or burden calculated from profits, gains, interest, salaries, wages, tips, inheritances or any other lawfully realized money.


NOTE: these words would return us to our founding father’s ORIGINAL TAX PLAN as they intended it to operate! They would also end the experiment with allowing Congress to lay and collect taxes calculated from lawfully earned "incomes" which now oppresses America‘s economic engine and robs the bread which working people have earned when selling their labor!

"SECTION 2. Congress ought not raise money by borrowing, but when the money arising from imposts duties and excise taxes are insufficient to meet the public exigencies, and Congress has raised money by borrowing during the course of a fiscal year, Congress shall then lay a direct tax at the beginning of the next fiscal year for an amount sufficient to extinguish the preceding fiscal year's deficit, and apply the revenue so raised to extinguishing said deficit."


NOTE: Congress is to raise its primary revenue from imposts and duties, [taxes at our water’s edge], and may also lay miscellaneous internal excise taxes on specifically chosen articles of consumption. But if Congress borrows and spends more than is brought in from imposts, duties and miscellaneous excise taxes during the course of a fiscal year, then, and only then, is the apportioned tax to be laid.


"SECTION 3. When Congress is required to lay a direct tax in accordance with Section 1 of this Article, the Secretary of the United States Treasury shall, in a timely manner, calculate each State's apportioned share of the total sum being raised by dividing its total population size by the total population of the united states and multiplying that figure by the total being raised by Congress, and then provide the various State Congressional Delegations with a Bill notifying their State’s Executive and Legislature of its share of the total tax being collected and a final date by which said tax shall be paid into the United States Treasury."


NOTE: our founder’s fair share formula to extinguish an annual deficit would be:

States’ population

---------------------------- X SUM TO BE RAISED = STATE’S FAIR SHARE

Total U.S. Population


The above formula, as intended by our founding fathers, is to insure that those states who contribute the lion’s share of the tax are guaranteed a representation in Congress proportionately equal to their contribution, i.e., representation with proportional financial obligation!


Note also that each State’s number or Representatives, under our Constitution is determined by the rule of apportionment:


State`s Pop.
------------------- X House size (435) = State`s No. of Representatives
U.S. Pop.


"SECTION 4. Each State shall be free to assume and pay its quota of the direct tax into the United States Treasury by a final date set by Congress, but if any State shall refuse or neglect to pay its quota, then Congress shall send forth its officers to assess and levy such State's proportion against the real property within the State with interest thereon at the rate of ((?)) per cent per annum, and against the individual owners of the taxable property. Provision shall be made for a 15% discount for those States paying their share by ((?))of the fiscal year in which the tax is laid, and a 10% discount for States paying by the final date set by Congress, such discount being to defray the States' cost of collection."


NOTE: This section respects the Tenth Amendment and allows each state to raise its share in its own chosen way in a time period set by Congress, but also allows the federal government to enter a state and collect the tax if a state is delinquent in meeting its obligation.


"SECTION 5. This Amendment to the Constitution, when ratified by the required number of States, shall take effect no later than (?) years after the required number of States have ratified it.


JWK


“…..with all these blessings, what more is necessary to make us a happy and a prosperous people? Still one thing more, fellow-citizens—a wise and frugal Government, which shall restrain men from injuring one another, shall leave them otherwise free to regulate their own pursuits of industry and improvement and shall not take from the mouth of labor the bread it has earned. This is the sum of good government, and this is necessary to close the circle of our felicities“. Thomas Jefferson, First Inaugural Address

Not just no, but HELL NO!

We do not live in the 18th Century, no matter how the reactionary right spins the issues, the world is a much different place than it was 200 + years ago.

Right, now the politicians can spend us into bankruptcy. There is no effective constraint on their larceny. That would have been unthinkable in the 18th century.

Blame the problem on Bush/Cheney who cut taxes and engaged in a long and unnecessary war of choice. Then and only then can we have a real debate on reform. Your idea of reform is to cut benefits to the needy, raise their taxes too, and give corporations and the very wealthy more and more and more.

You're a fool, and fools are necessary for the power elite to keep and gain power.

Look in the mirror and consider the absurdity of your post. The fact is, Congress could end the entire food stamp program and at the same time reduce the amount of federal taxes now paid by the people of the states by the same total and have the people keep this money in their own pocket. This would allow current food stamp money to remain in the states and each state may then meet their own responsibilities [with respect to "food stamps"] as intended under federalism, our Constitution's plan which is summarized as follows:


“The powers delegated by the proposed Constitution to the federal government are few and defined. Those which are to remain in the State governments are numerous and indefinite. The former will be exercised principally on external objects, as war, peace, negotiation, and foreign commerce; with which last the power of taxation will, for the most part, be connected.


The powers reserved to the several States will extend to all the objects which, in the ordinary course of affairs, concern the lives, liberties, and properties of the people, and the internal order, improvement, and prosperity of the State." ___ Federalist No. 45


One of the immediate savings would be is getting rid of the thousands of federal employee parasites who now administer the food stamp program and live large on the taxpayer's money with their outrageous salaries and pension program which the surfs in the states are taxed to finance.


The federal department of education is another parasitic organization there to redistribute money taxed away from the people of the states and has approximately 5,000 parasites sucking the blood from the people's paychecks, some of whom can barely meet their own economic needs.


Why do you support this parasitic infestation in Washington which is sucking the life's blood from the hard working American People?


JWK







They are not “liberals”. They are conniving parasites who use the cloak of government force to steal the wealth which wage earners, business and investors have worked to create

In my considered opinion, the ideas of governance suggested by Callous Conservatives in a libertarian framework is a fantasy. Being pragmatic, my vision of their vision is chaos.

 

[nodoginnafight]

The only thing the Republicans have tried to do is change the payee on the checks they write

 

[g5000]

I want you to imagine two next door neighbors, Robert and William. They each have an annual household income of $50,000.

Now I want you to imagine the cost of the stretch of road in front of their two houses represents their total tax burden. For the purposes of this illustration, it does not matter what the total cost is. That stretch of road represents all the costs of the services the government provides. Defense, infrastructure, post offices, food stamps, whatever.

Most budget battles are over how much the government does and how much it spends, and that is all well and good. But the point of this exercise is to demonstrate that no matter what the size of the budget is, these neighbors of equal incomes should have an equal tax burden.

Let’s say the stretch of road in front of both houses costs $10,000. Therefore, each neighbor’s share of the burden should be $5,000, or 10 percent of their incomes.

But thanks to government tax expenditures, that is not the case in America.

What are tax expenditures? They are those tax deductions, exemptions, and credits you take when you file your income taxes. Some pundits like to portray this process of taking advantage of exemptions, credits, and deductions as “getting to keep more of your own money”, but they are either deliberately misleading you, or they are woefully misinformed.

I am not saying you should leave money on the table. If the government puts it there for you to take, you would be a fool not to take it. But I am going to show you it is not really your money.

As it happens, Robert has a mortgage and so he gets a $500 mortgage interest deduction. He also has two kids, and gets another $1000 child tax credit.

Robert's tax bill, therefore, is reduced from $5,000 to $3,500. This is the part where those pundits jump up and down with glee and say Robert is getting to keep $1,500 of his own money.

Now let's look at William's situation and see whose money it really is that Robert is getting. William is a renter (or he has paid off his mortgage). And he is childless. So William cannot take those deductions.

The government still needs a total of $10,000 from Robert and William to pay for that stretch of road in front of their houses. How will the government make up for the $1,500 it is giving back to Robert?

It will have to get that money from William, if there is to be a balanced budget. Otherwise, the government will have to run a deficit and borrow the money from places like China or the Federal Reserve.

If the government wants to balance the budget, it will have get $6,500 out of William instead of $5,000. It accomplishes this by raising the tax rate considerably. Instead of a 10 percent rate, which is what William would have had under a system of equality, the government will have to raise the tax rate to 13 percent.

William's tax rate just jumped 30 percent to pay for Robert's deductions and credits! So while disingenous pundits cheer that Robert “gets to keep more of his own money”, they are ignoring that William is having to give up more of his money to keep the budget in balance.

In the real world, taxpayers will not stand for a 30 percent jump in taxes. They won't even stand for a 10 percent jump. In fact, there are quite a few politicians saying we need to lower everyone's tax rates even more, even though we are running annual deficits!

Since the taxpayers will only stand for so much in the way of a tax hike, the only other means to pay for all these deductions, credits, and exemptions is for the government to borrow the money that it is giving back to Robert.

Today, the government is handing out $1.2 trillion every year in these tax expenditures. This is the only real figure in this allegory. Every time you take advantage of a deduction or exemption or credit, you are responsible for everyone's tax rates being higher than they should be, and for the excessive annual deficits.

We live under an insane system where two people earning identical incomes are paying radically different amounts in taxes.

This is also true for businesses. Two businesses earning identical incomes are paying radically different corporate income taxes.

This insanity must end.

If we eliminated $1.2 trillion in government handouts, not only would be no longer have a deficit, we would be running a surplus. We could then use that surplus to lower everyone's tax rates and pay down the debt, and once the debt was paid off, we could further lower everyone's tax rates.

We whine about someone getting food stamps or welfare, and fail to see that every one of us is greedily demanding our own form of government handout. Capital depreciation deductions, mortgage interest deductions, employer-sponsored health insurance income exemptions. Most of these tax expenditures are highly regressive. The more income you have, the bigger the tax break you get.

 

[g5000]

A number of exclusions, deductions, preferential rates, and credits in the federal tax system cause revenues to be much lower than they would be otherwise for any given structure of tax rates. Some of those provisions—in both the individual and corporate income tax systems—are termed “tax expenditures” because they resemble federal spending by providing financial assistance to specific activities, entities, or groups of people. Tax expenditures, like traditional forms of federal spending, contribute to the federal budget deficit; influence how people work, save, and invest; and affect the distribution of income.

The Distribution of Major Tax Expenditures in the Individual Income Tax System Congressional Budget Office


Tax expenditures are a massive government behavioral modification program.

It amazes me whenever someone claiming to be a conservative supports them.

 

[g5000]

So like I keep saying...Republicans prefer to redistribute wealth through the tax code. It's sneakier that way. And their way means higher tax rates for everyone, not just the rich.

 

[Nosmo King]

What would a balanced budget amendment do to the bond market?

 

[g5000]

What would a balanced budget amendment do to the bond market?

It would be harder for the FOMC to adjust interest rates as there would no longer be any monetizing of federal debt.

ETA: And yet states with balanced budget amendments still issue bonds.

 

[TooTall]

So like I keep saying...Republicans prefer to redistribute wealth through the tax code. It's sneakier that way. And their way means higher tax rates for everyone, not just the rich.

The Bush tax cuts LOWERED tax rates for every single taxpayer.

 

[bripat9643]

Tax expenditures are spending, and they are paid for by higher tax rates and borrowing. Simple fact.

ROFL! No, they are not spending, anymore than a business declining to collect some fee it formerly charged would be considered spending by the business.

Liberals are always trying to change the definition of words to justify their idiocies.

 

[Mac1958]

What would a balanced budget amendment do to the bond market?

It would be harder for the FOMC to adjust interest rates as there would no longer be any monetizing of federal debt.

ETA: And yet states with balanced budget amendments still issue bonds.

Yeah.

And the money would still need to go somewhere. So munis and corporates would be come more and more attractive. Build America Bonds.

War bonds, too. Goodness knows we love our wars, that would be an exception to the BBA. And/or temporary war taxes.

This can be done, the kinks could be worked out. But our "leaders" don't have the balls, and they need to buy influence.

.

 

[g5000]

Tax expenditures are spending, and they are paid for by higher tax rates and borrowing. Simple fact.

ROFL! No, they are not spending, anymore than a business declining to collect some fee it formerly charged would be considered spending by the business.

False analogy. Read posts 148 and 149.

You are quite wrong.

 

[g5000]

If a restaurant let people who wear red ties eat for free, then anyone not wearing a red tie would have to pay more to offset the free meals given to the red ties, or the restaurant would go into debt.

That is how tax expenditures work. We are all restaurant (government) customers, and yet some of us are getting a discount while others are having to make up the difference.

But those who aren't getting the discount refuse to pay 100 dollars for a burger, and so the restaurant IS going into debt.

 

[TooTall]

There is nothing in H.R. 25 to withdraw from Congress' power the power to lay and collect taxes calculated from lawfully earned "incomes". Stop posting propaganda! Make references to the actually wording contained in H.R. 25, and then we can discuss it in an intelligent manner.


JWK

Text - H.R.25 - 114th Congress 2015-2016 FairTax Act of 2015 Congress.gov Library of Congress

SEC. 101. INCOME TAXES REPEALED.

Subtitle A of the Internal Revenue Code of 1986 (relating to income taxes and self-employment taxes) is repealed.

Just as I stated, there is nothing in H.R. 25 to withdraw from Congress' power the power to lay and collect taxes calculated from lawfully earned "incomes". To do so requires a constitutional amendment! The section you cite is not a constitutional amendment.


JWK

The 16th Amendment allowed the federal government to lay and collect taxes on incomes. The Congress sets the tax rate that people pay. That rate is constantly being changed. The Bush tax cuts come to mind. The Fair Tax would have Congress set the tax rate to ZERO.
In order for Congress to repeal a Constitutional amendment, they would then have to pass a bill to do so and send it to the states for ratification. If it was not ratified in 7 years, the Fair Tax would expire.

 

[g5000]

So like I keep saying...Republicans prefer to redistribute wealth through the tax code. It's sneakier that way. And their way means higher tax rates for everyone, not just the rich.

The Bush tax cuts LOWERED tax rates for every single taxpayer.

Like I said, there are those who call for lower taxes while we are still running deficits, and yet still give away the store with tax expenditures.

As I said...insanity.

 

[bripat9643]

Tax expenditures are spending, and they are paid for by higher tax rates and borrowing. Simple fact.

ROFL! No, they are not spending, anymore than a business declining to collect some fee it formerly charged would be considered spending by the business.

False analogy. Read posts 148 and 149.

You are quite wrong.

Your analogy is false because most government spending does not go for infrastructure. It goes to provide sustenance to parasite, or it goes to government activities that are absolutely harmful to the taxpayers.