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Post by brucemacneill on Sept 20, 2011 15:11:08 GMT -5
Don't at all mean to start a political thread. I just wondered after reading this on CNBC, is this news? Is there anyone here who doesn't know that rich people pay more taxes than poor people? Is this a necessary news story, especially from a financial news outlet? Why would they bother to write this? I'm asking seriously, can anyone give a reason for this article? www.cnbc.com/id/44591639 |
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Post by fatstrat on Sept 20, 2011 15:17:52 GMT -5
If I may, POLITELY AND RESPECTFULLY. I think the DNC or who ever is in charge, seeing his dwindling support numbers, wants Obama to not run again. They may be turning on their own man.
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Post by paulschlimm on Sept 20, 2011 15:41:44 GMT -5
The President said this:
"Middle-class families shouldn't pay higher taxes than millionaires and billionaires," Obama said Monday. "That's pretty straightforward. It's hard to argue against that."
Yes, a rebuttal is newsworthy if the facts don't support his assertion.
That said, and I've said here before, given the country's current financial state, we need both spending cuts and tax increases over the short-term to dig us out of this hole.
What noone really talks about is the magnitude of the proposed tax increases. If anyone is advocating a massive tax hike, I haven't read about it. Links, anyone?
What I'm less comfortable with is where that increased revenue would go. There's an age-old expression called, "pouring good money after bad," and I reckon I just don't trust the fellers in DC to come up with a good plan for it.
Jaded. Acknowledged.
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Post by omaha on Sept 20, 2011 15:47:54 GMT -5
The "big lie" in all this has to do with taxing dividend income.
Its completely misleading to say its taxed at 15%.
Yes, to the recipient of dividend income, they pay 15%, but that's after the company who earned the money already paid corporate income tax on the same money. Its taxed twice.
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Post by brucemacneill on Sept 20, 2011 15:52:34 GMT -5
Well, I see I missed one thing, which is it's from AP and just picked up by CNBC so the article was for general consumption which makes more sense than it being a "Financial news" story. This, the soundhole, being a group of reasonably informed people, I just wondered if this was "News" to anyone but seeing it as a general news story, I guess it's for the less informed and if I could I'd just delete the question now.
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Post by theevan on Sept 20, 2011 16:01:00 GMT -5
The comparison is apples and cantaloupes as pointed out by Omaha.
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Post by Jawbone on Sept 20, 2011 16:19:32 GMT -5
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Post by millring on Sept 20, 2011 16:27:15 GMT -5
There are just so many things wrong with the entire premise. As stated ably by Omaha (and echoed by Evan) Buffett is playing a game that is almost entirely false.
That's bad enough, but take the premise further....
If the ONLY hope we have for getting out of debt and/or deficit reduction is by economic growth (and it is), then one has to ask....if you had $100 to invest, would you take investment advice from Warren Buffett or from the US gov't? Exactly. So, on what basis, exactly, is Buffett himself asserting the absurd probability that taking money from him and his ability to invest it -- and giving that money to the government to invest -- is going to do anything toward growing us out of our crisis?
We ALL owe the government the money. There's an absurd bit of radio theater making the rounds of right wingery -- a radio interview with congressman Jan Schakowsky in which she is asked the question, "What percentage of a person's pay do they deserve to keep?". The reason it is making the right wing rounds is because Jan boldly answers "Well, certainly not all of it!". That, of course, is the correct answer -- though apparently not to the right wing (The right wing host thinks we deserve to keep all of it.....and then backtracks and says 'of course, we need to pay for security yada yada")
But even accepting the premise that we all purposely, or against our will and better judgement but losing in the democratic process, now owe the government's debt to the tune of more than we can pay, we STILL and NOW have to consider what is the wisest means of doing so. And muzzling the ox that pulls the plow is probably not that wise way.
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Post by Fingerplucked on Sept 20, 2011 16:35:16 GMT -5
The "big lie" in all this has to do with taxing dividend income. Its completely misleading to say its taxed at 15%. Yes, to the recipient of dividend income, they pay 15%, but that's after the company who earned the money already paid corporate income tax on the same money. Its taxed twice. Isn't that true of wages as well, or am I missing something? |
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Post by Supertramp78 on Sept 20, 2011 16:39:44 GMT -5
Jeff, all money is taxed over and over again. By your argument the employees of that company shouldn't have to pay income tax on their salaries because that's after the company who earned the money already paid corporate income tax on the same money! So what? To the guy who gets the dividend, it is income. Plain and simple. Tax it. Is 15% too low? Beats the hell out of me.
Obama i strying to justiy a $1.5 trillion tax increase (over ten years) and he's pulling out every argument he can to convince people. Now a lot of that comes from closing tax loopholes (even the GOP has said that closing loopholes would be allowed within the confines of their no tax blood oath) and cutting subsidies to oil companies (which sounds good until gas prices go up and the cost of everything else in the world goes with it).
I kind o flike John's idea from weeks ago that there be a *minimum* tax that everyone pays regardless of your income level. You want to live here? Put some skin in the game. But overall, the tax income is going to have to come up from the historically low percentages it is at now (which, like the GOP likes to say about the stimulus plan, hasn't worked to stimulate the economy).
As far as fats' (or should we say strats'?) idea that the Dems want Obama to drop out? Who knows. Not really part of the story here. But if he were, I'm sure Hillary would step in and probably win seeing that she is right now the most popular pol in the country. Imagine that.
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Post by omaha on Sept 20, 2011 16:41:00 GMT -5
The "big lie" in all this has to do with taxing dividend income. Its completely misleading to say its taxed at 15%. Yes, to the recipient of dividend income, they pay 15%, but that's after the company who earned the money already paid corporate income tax on the same money. Its taxed twice. Isn't that true of wages as well, or am I missing something? No, that's not true. Salaries and wages are a deductible expense for businesses. |
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Post by omaha on Sept 20, 2011 16:42:01 GMT -5
Jeff, all money is taxed over and over again. By your argument the employees of that company shouldn't have to pay income tax on their salaries because that's after the company who earned the money already paid corporate income tax on the same money! No, they didn't. See my comment to Jim above. |
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Post by Supertramp78 on Sept 20, 2011 16:45:52 GMT -5
But seriously, what does that have to do with anything? If the company deducts it or not? the company pays taxes. They make a profit. they give some of the profit to investors. that's their income. it shouldn't be taxed? those guys take that money and buy a car. should they pay sales tax? If they hire a guy to mow the lawn, should that guy have to pay income taxes on it?
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Post by millring on Sept 20, 2011 16:49:46 GMT -5
I kind o flike John's idea from weeks ago that there be a *minimum* tax that everyone pays regardless of your income level. You want to live here? Put some skin in the game. I still think it's a good idea. I think it's one of our biggest problems we face with our economic set-u. More than half of us are dependent upon entitlements of some kind and we've lost the mental connection that those entitlements cost SOMEBODY something. We have WAY too many people who think government money is free.... ...because it has been. It's been credit for so long now that we don't have the argument anymore over we can afford the next entitlement we want to pile on our shoulders. In fact, we've totally lost the ability for frugality to be the moral high ground. If we think the entitlement is a worthy....or even moral...choice (as we have with healthcare) we actually have the audacity to look down on those who dare to question whether we can afford it. Such stinginess is usually met with a "so you want our babies to die eating lead paint while working in the dark, gassy coal mines? huh? well, do you?! I thought so." In fact, that's the most infuriating element of these new campaign speeches that Obama has launched. ALWAYS and without exception, disagreement with his plan is characterized as the opposition choosing to harm the citizenry. It's just such BS and it's not the Obama I voted for, either. It's just old fashioned class warfare....even though he attempts to rhetorically insulate himself from the charge. |
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Post by millring on Sept 20, 2011 16:53:42 GMT -5
And, of course, that brings up the other BS factor with Obama's plan. You cannot tax a corporation. To do so is simply taxing the people who use the goods and services of the corporation. In other words, though it makes Democrats feel really, really good to stick it to one of their life-long demons -- corporations (especially successful ones) -- in truth, they are merely raising taxes on the middle class.
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Post by theevan on Sept 20, 2011 16:53:51 GMT -5
Time to beat the flat tax drum again. The ultimate "skin in the game" taxation scenario, eh?
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Post by omaha on Sept 20, 2011 16:57:29 GMT -5
Consider this hypothetical (and ridiculously simplified) P&L statement:
Sales: $10,000
Expenses:
Salaries and Wages : $5,000
Cost of Goods Sold : 2,000
Rent and Utilities : 1,500
Advertising : 500
Total Expenses: $9,000
Gross Earnings : $1,000
Federal Income Tax : $350 (assuming the top marginal rate of 35%)
Earnings after Taxes: $650
Dividends Paid : $500
Retained Earnings : $150
*****
So, the company pays out $500 in dividends to shareholders, each of which is subject to a 15% rate. So that works out to an additional tax of $75, taking the total tax paid on $1000 in earnings to $425...or 42.5%....which is a higher rate than that paid by "Warren Buffett's secretary", or anyone else who is paying taxes based on earned income.
Which gets to the point: The distinction between the taxes paid by the corporation and the taxes paid by the shareholder on the same dollar of earnings is entirely arbitrary. Therefore, to say that dividends are undertaxed (which is Buffett's position) is equally arbitrary.
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Post by Supertramp78 on Sept 20, 2011 16:58:57 GMT -5
There is a guy at my office who is even farther to the left than me (imagine that) and he hates the idea of a flat tax but for the life of him he has yet to come up with a good reason for feeling that way. He keeps thinking that rich people will pay less under a flat consumption tax. I just can't see it. I still haven't heard of a good argument against it and several really compelling arcuments for it.
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Post by Fingerplucked on Sept 20, 2011 17:00:28 GMT -5
Isn't that true of wages as well, or am I missing something? No, that's not true. Salaries and wages are a deductible expense for businesses. Well that's not right. I don't think it should be deductible. Once we get that fixed, I can agree with you and we can eliminate the income taxes I'm paying. |
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Post by paulschlimm on Sept 20, 2011 17:01:05 GMT -5
+1
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