Why isn't the GOP talking about cutting taxes right now?

[WillowTree]

Can you give me a primer on it; getting ready for the quarterly aduits and I don't think CSPAN is part of the review pack.

google cut cap and balance. it's easy

A constitutional amendment to balance the budget. I'd have to see the language but I like the idea.

The bill would cut fiscal year 2012 spending by $111 billion, cap future spending at 18 percent of GDP, and propose a balanced budget amendment to the Constitution.

I don't see the screaming for tax cuts I was asking about.

Maybe it's because they're smart enough to know everyone just agreed to extend the Bush Tax Cuts. Ya think?

 

[NYcarbineer]

If it will fix everything...why not do it now?

Because now the GOP is focused on taking political advantage of the deficits that their previous tax cuts created.

Yes, it is diabolical.

 

[Zander]

If it will fix everything...why not do it now?

Because now the GOP is focused on taking political advantage of the deficits that their previous tax cuts created.

Yes, it is diabolical.

Not true. The Bush tax cuts increased revenue more than enough to pay off the debt they created. The problem was the Republican Congress increased spending massively. Then Pelosi and Reid doubled down on spending.

Spending is the problem- not tax cuts. Now we've painted ourselves into a corner and there are no easy answers. It is not a partisan issue- it is an AMERICAN issue.

 

[Robert]

Apparently tax increases won't help either. It's hard to figure out the GOP position. Obama has offered to cut spending and the GOP wants, apparently to do nothing on the revenue side.

Odd.

Not really. The GOP is afraid the TPM and other radical right ideologues will send them packing next year if they vote to raise taxes.

As well they should, its interesting to note isn't that the left doesn't have any one group insuring their elected officials do the right thing why is that?

 

[DavidS]

This is really not the time for Partisan bickering and childish zings, we're far past that point. There are no good choices. The time for good choices was years ago. I was and still am a fan of the Bush tax cuts. They were not the problem; a few years after the cuts, tax revenues were up considerably. The problem was a reckless Congress (surprise! they were republicans!) which allowed spending to rise even more! And you can’t just blame it on the wars. That contributed, but it was not even close to the lion’s share. If we had held the line on spending, we would have paid off the entire debt and been in good shape when the crisis hit in 2008.

So now we have decisions to make; Either we willingly cut the deficit by a far more significant amount than anyone is discussing, or we hit the wall at some point and become Greece. We have painted ourselves into the corner with difficult and disastrous choices. We have condemned ourselves to a slow-growth, Muddle Through Economy for another 5-6 years, at best, as we are forced to right-size government. If we raise taxes to partially solve the problem, we have to recognize that higher taxes will result in slower private growth. That’s just the rules. There are no easy buttons to push.

So, we must cut spending and the deficit, and yes, it is going to slow the economy for a period of time.

It depends on how high the taxes are. If the taxes are raised to 90%, yes, absolutely that'll slow the economy to a halt. If the taxes are raised up to 5%, on anyone who earns $250,000 ***NET*** per year (net = final number after all deductions and before taxes). 5% on $250,000. That's $12,500. It's nothing to them.

It sounds good, just an additional 5% tax! Who could object? But the fact is higher taxes stifle job creation, always.

Here is a very helpful equation: GDP = C + I + G + net exports

The I in the equation is investments. That is what produces the tools and businesses that make “stuff” and buy and sell services. Increasing government spending, G, does not increase productivity. It transfers taxes taken from one sector of the economy and to another, with a cost of transfer, of course. While the people who get the transfer payments and services certainly feel better off, those who pay taxes are left with less to invest in private businesses that actually increase productivity. Over the last two decades, the net new jobs in the US have come from business start-ups. Not large businesses (they are a net drag) and not even small businesses. Understand, some of those start-ups became Google and Apple, etc.; but many just become good small businesses, hiring 5-10-50-100 people. But the cumulative effect is growth in productivity and the economy.

If you take an additional $12,500 in taxes from a small business that nets $250K a year- you take that money away from investment and that means fewer jobs.

First of all, you can't hire someone on $12,500 a year. Second of all, a small business does not get taxed. Taxes for LLC's and S-Corps pass through the corporation into the shareholders. If I earn $250,000 net and I'm a 100% shareholder, the profit is added onto my personal income, not corporate income. That's in addition to whatever salary I pay myself and let's just say a business that earns $250,000 a year, net, I don't pay myself, then I have to pay 38% tax instead of 33% tax. So instead of paying $82,500 in taxes, I pay $95,000 in taxes. And you think THAT difference is going to make me not hire more people to work for me? Really?

Sorry, I disagree with you

 

[DavidS]

Increase of the working age population?

I don't see how that bumps up the economy but you're the expert.

I would imagine that creating new industries would be one way to increase the number of people working--productivity--but I guess you were including that.

So tax cuts do nothing to grow the economy? Is that what you're saying?

Creating new industries just leads to a bubble. When was the last time our economy was good without relying on a bubble?

I don't think that is necessarily the case. The guys making airbags for cars...are they in a bubble? The guys making wind turbines; that doesn't seem like a bubble to me. Twenty years ago, neither existed...did they not?

I think that the real bubble folks are the ones creating new devices that do nothing. My condo recently forced me to start buying liability insurance. So if the fire place I don't have burns the building down or melts the waterbed I don't have, the damage caused to the other floors of the condo are taken care of. The price of the policy? A mere $25,000. The first ember of a fire would do more damage than that yet I'm just having to fork over another $22.33 a month for this "security" and peace of mind. Bull-to-the-Shit. The investors in the insurance agency are living in a bubble because eventually these worthless policies will be done away with. But new industries that make stuff that people need are not bubbles in my view.

Airbags are made in China. So I don't care about that. And yes, wind turbine along with other clean energy is the next bubble. If oil prices reach $150 next Spring as predicted, then alternative energy will be the next bubble.

 

[Sallow]

If it will fix everything...why not do it now?

They have been.

 

[Toddsterpatriot]

If it will fix everything...why not do it now?

Haven't some been calling for cutting our highest in the world corporate tax rates?
I think we should cut corporate rates and cap gains to 10%.

 

[Sallow]

If it will fix everything...why not do it now?

Haven't some been calling for cutting our highest in the world corporate tax rates?
I think we should cut corporate rates and cap gains to 10%.

See?

 

[Toddsterpatriot]

If it will fix everything...why not do it now?

Haven't some been calling for cutting our highest in the world corporate tax rates?
I think we should cut corporate rates and cap gains to 10%.

See?

Glad to help.

 

[NYcarbineer]

If it will fix everything...why not do it now?

Haven't some been calling for cutting our highest in the world corporate tax rates?
I think we should cut corporate rates and cap gains to 10%.

Yeah, we could be like Ireland. Remember the Ireland story, some of you, from a few years back?

Ireland was the economic darling of the free world, and the tale was, it was all about Ireland cutting its corporate tax rates. Big story!!

How's that workin' out now?

 

[Toddsterpatriot]

If it will fix everything...why not do it now?

Haven't some been calling for cutting our highest in the world corporate tax rates?
I think we should cut corporate rates and cap gains to 10%.

Yeah, we could be like Ireland. Remember the Ireland story, some of you, from a few years back?

Ireland was the economic darling of the free world, and the tale was, it was all about Ireland cutting its corporate tax rates. Big story!!

How's that workin' out now?

The tax cuts worked great.
Unemployment was the lowest in the EU.
You think that was the cause of the real estate bubble? LOL!

 

[blastoff]

Cut spending and cut taxes. I can only dream.

But a true NIGHTMARE to lefty idiots.

 

[Zander]

It depends on how high the taxes are. If the taxes are raised to 90%, yes, absolutely that'll slow the economy to a halt. If the taxes are raised up to 5%, on anyone who earns $250,000 ***NET*** per year (net = final number after all deductions and before taxes). 5% on $250,000. That's $12,500. It's nothing to them.

It sounds good, just an additional 5% tax! Who could object? But the fact is higher taxes stifle job creation, always.

Here is a very helpful equation: GDP = C + I + G + net exports

The I in the equation is investments. That is what produces the tools and businesses that make “stuff” and buy and sell services. Increasing government spending, G, does not increase productivity. It transfers taxes taken from one sector of the economy and to another, with a cost of transfer, of course. While the people who get the transfer payments and services certainly feel better off, those who pay taxes are left with less to invest in private businesses that actually increase productivity. Over the last two decades, the net new jobs in the US have come from business start-ups. Not large businesses (they are a net drag) and not even small businesses. Understand, some of those start-ups became Google and Apple, etc.; but many just become good small businesses, hiring 5-10-50-100 people. But the cumulative effect is growth in productivity and the economy.

If you take an additional $12,500 in taxes from a small business that nets $250K a year- you take that money away from investment and that means fewer jobs.

First of all, you can't hire someone on $12,500 a year. Second of all, a small business does not get taxed. Taxes for LLC's and S-Corps pass through the corporation into the shareholders. If I earn $250,000 net and I'm a 100% shareholder, the profit is added onto my personal income, not corporate income. That's in addition to whatever salary I pay myself and let's just say a business that earns $250,000 a year, net, I don't pay myself, then I have to pay 38% tax instead of 33% tax. So instead of paying $82,500 in taxes, I pay $95,000 in taxes. And you think THAT difference is going to make me not hire more people to work for me? Really?

Sorry, I disagree with you

You can disagree all day, it won't change the facts.

"Investment" is not limited to adding employees directly. If the government takes an additional $12,500 from you in your hypothetical example, that is $12,500 you (and millions of other entrepreneurs) no longer have available to purchase equipment, computers, pencils, advertising, etc.. That is why whenever tax rates increase - the amount of cash available for "investment" decreases- and unemployment increases because of it.

 

[candycorn]

Creating new industries just leads to a bubble. When was the last time our economy was good without relying on a bubble?

I don't think that is necessarily the case. The guys making airbags for cars...are they in a bubble? The guys making wind turbines; that doesn't seem like a bubble to me. Twenty years ago, neither existed...did they not?

I think that the real bubble folks are the ones creating new devices that do nothing. My condo recently forced me to start buying liability insurance. So if the fire place I don't have burns the building down or melts the waterbed I don't have, the damage caused to the other floors of the condo are taken care of. The price of the policy? A mere $25,000. The first ember of a fire would do more damage than that yet I'm just having to fork over another $22.33 a month for this "security" and peace of mind. Bull-to-the-Shit. The investors in the insurance agency are living in a bubble because eventually these worthless policies will be done away with. But new industries that make stuff that people need are not bubbles in my view.

Airbags are made in China. So I don't care about that. And yes, wind turbine along with other clean energy is the next bubble. If oil prices reach $150 next Spring as predicted, then alternative energy will be the next bubble.

So anything invented from this point forward is a bubble? Okay. Weird!

 

[candycorn]

It sounds good, just an additional 5% tax! Who could object? But the fact is higher taxes stifle job creation, always.

Here is a very helpful equation: GDP = C + I + G + net exports

The I in the equation is investments. That is what produces the tools and businesses that make “stuff” and buy and sell services. Increasing government spending, G, does not increase productivity. It transfers taxes taken from one sector of the economy and to another, with a cost of transfer, of course. While the people who get the transfer payments and services certainly feel better off, those who pay taxes are left with less to invest in private businesses that actually increase productivity. Over the last two decades, the net new jobs in the US have come from business start-ups. Not large businesses (they are a net drag) and not even small businesses. Understand, some of those start-ups became Google and Apple, etc.; but many just become good small businesses, hiring 5-10-50-100 people. But the cumulative effect is growth in productivity and the economy.

If you take an additional $12,500 in taxes from a small business that nets $250K a year- you take that money away from investment and that means fewer jobs.

First of all, you can't hire someone on $12,500 a year. Second of all, a small business does not get taxed. Taxes for LLC's and S-Corps pass through the corporation into the shareholders. If I earn $250,000 net and I'm a 100% shareholder, the profit is added onto my personal income, not corporate income. That's in addition to whatever salary I pay myself and let's just say a business that earns $250,000 a year, net, I don't pay myself, then I have to pay 38% tax instead of 33% tax. So instead of paying $82,500 in taxes, I pay $95,000 in taxes. And you think THAT difference is going to make me not hire more people to work for me? Really?

Sorry, I disagree with you

You can disagree all day, it won't change the facts.

"Investment" is not limited to adding employees directly. If the government takes an additional $12,500 from you in your hypothetical example, that is $12,500 you (and millions of other entrepreneurs) no longer have available to purchase equipment, computers, pencils, advertising, etc.. That is why whenever tax rates increase - the amount of cash available for "investment" decreases- and unemployment increases because of it.

This is where I get a bit confused.

Again, if it means more hires, they should be shouting "cut taxes" from the rooftops.

I don't think it means anything when you cut taxes. If I have a side business and you cut my taxes, I'm not necessarily going to hire people just because I can. I'll pocket the windfall, perhaps buy some more stock...maybe.

It's not a guarantee.

Just like raising taxes isn't a guarantee that there will be slower hiring.

I will agree that if you have less money in the hands of business owners, they will LIKELY not hire more people but I doubt they will start firing people based on having to ante up another $5K a year. Maybe but I don't think so. They still need to compete with others.

 

[candycorn]

If it will fix everything...why not do it now?

Haven't some been calling for cutting our highest in the world corporate tax rates?
I think we should cut corporate rates and cap gains to 10%.

Really? When and who? Apparently the leadership isn't behind it. Why?

 

[candycorn]

Actually that suggestion *is* being made.

In Demo-speak "spending cuts" are defined as not increasing spending as much as last year.
By that logic, 'not raising taxes' would be defined as a tax cut, wouldn't it???
















Reaching? or just too much wine?

Maybe...I see where you're going so maybe I'm just as drunk.

But seriously, if the slashing of taxes was such a silver bullet, wouldn't McConnell, Bohener, Limbaugh, Ryan, et. al. be screaming it right now?

I think tax cuts aren't being mentioned because most sane people realize revenue stream (without having to increase it substantially) and cutting unnecessary spending........

Not sure what you meant there. Can you elaborate?

 

[candycorn]

google cut cap and balance. it's easy

A constitutional amendment to balance the budget. I'd have to see the language but I like the idea.

The bill would cut fiscal year 2012 spending by $111 billion, cap future spending at 18 percent of GDP, and propose a balanced budget amendment to the Constitution.

I don't see the screaming for tax cuts I was asking about.

Maybe it's because they're smart enough to know everyone just agreed to extend the Bush Tax Cuts. Ya think?

So no more tax cuts? Ya think?

 

[Zander]

First of all, you can't hire someone on $12,500 a year. Second of all, a small business does not get taxed. Taxes for LLC's and S-Corps pass through the corporation into the shareholders. If I earn $250,000 net and I'm a 100% shareholder, the profit is added onto my personal income, not corporate income. That's in addition to whatever salary I pay myself and let's just say a business that earns $250,000 a year, net, I don't pay myself, then I have to pay 38% tax instead of 33% tax. So instead of paying $82,500 in taxes, I pay $95,000 in taxes. And you think THAT difference is going to make me not hire more people to work for me? Really?

Sorry, I disagree with you

You can disagree all day, it won't change the facts.

"Investment" is not limited to adding employees directly. If the government takes an additional $12,500 from you in your hypothetical example, that is $12,500 you (and millions of other entrepreneurs) no longer have available to purchase equipment, computers, pencils, advertising, etc.. That is why whenever tax rates increase - the amount of cash available for "investment" decreases- and unemployment increases because of it.

This is where I get a bit confused.

Again, if it means more hires, they should be shouting "cut taxes" from the rooftops.

I don't think it means anything when you cut taxes. If I have a side business and you cut my taxes, I'm not necessarily going to hire people just because I can. I'll pocket the windfall, perhaps buy some more stock...maybe.

It's not a guarantee.

Just like raising taxes isn't a guarantee that there will be slower hiring.

I will agree that if you have less money in the hands of business owners, they will LIKELY not hire more people but I doubt they will start firing people based on having to ante up another $5K a year. Maybe but I don't think so. They still need to compete with others.

I'll tell you what I think the situation is, in my own opinion.

Tax cuts increase the deficit in the short run. So the reason we can't cut taxes now is because it would be politically impossible for Republicans to be screaming from the rooftops about "balancing the budget" and "Cutting spending"; then go out and call for tax cuts that will increase the debt.

The country has painted itself in a corner. We can't raise taxes, and we can't cut them. So we need to cut Gov't spending by 1-2% of GDP per year until we "right-size" the government. It is going to be a low or negative growth economy for the 5-6 years.

Tax increases always lower GDP, the question is by how much? So the real question is this: are we willing to take the double wammy of tax increases (that result in lower GDP) and lower government spending (also lowers GDP). Time will tell...