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Post by Chesapeake on Aug 26, 2014 14:52:47 GMT -5
The last time I felt good about a presidential vote was when I voted for Hubert Humphrey.
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Post by Fingerplucked on Aug 26, 2014 16:06:39 GMT -5
You have to be careful what you make of the 50s. There was a lot going on. We had pent up demand from the scarcity of basic products that had been diverted to the war effort, and prior to that, pent up demand from a decade in or near depression. We had excess capacity from the factories that were no longer needed for the war effort. We had a returning male workforce whose immediate impact was to begin the baby boom. We had free secondary education for that returning workforce. We had a new interstate highway system. The list goes on .... But I think most importantly, we had no competition. Most of the rest of the industrialized world was decimated. We were in a position where it was almost impossible to fail.
I think we prospered because of the combination of factors we had, a combination that would be impossible to duplicate today by any political party or agenda.
You could make a pretty good argument for any single factor (as long as it's the lack of competition, IMO) but that wasn't the world we were living in. It was the perfect storm for prosperity because of a half dozen or more factors all falling in to place.
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Post by Deleted on Aug 26, 2014 16:39:37 GMT -5
John, do you mean the lowest realized rate? We for sure don't have the lowest corporate tax rates. Our rate on the books is around 40%, according to KPMG here: www.kpmg.com/global/en/services/tax/tax-tools-and-resources/pages/corporate-tax-rates-table.aspxUKs is 20%. Germany has 29.58%. Japan has 35% and change. Republic of Korea has 24.2%. Now, does that mean corporations pay 40%? See here: www.forbes.com/sites/christopherhelman/2013/04/23/which-corporations-pay-the-most-taxes/"So what do you think, is $6 billion a lot, or a little to pay Uncle Sam? After all, Apple did chalk up $39 billion in net income for 2012. That means that it paid about 17% of its income to its home government." Does that mean Apple had to hire a fleet of accountants to work the law to get it's bill from 40% to 17%? How much time and capital did that cost Apple, who could have put the money to better use? So, why the hell we don't cut our corporate tax rate to, oh, a flat 20% and be done with the loop holes, excemptions and other mechanisms that eat up corporate revenue to work through, and government revenue to check up on, is beyond me.
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Post by Rob Hanesworth on Aug 26, 2014 17:50:54 GMT -5
John, In your Sanders example he says absolutely nothing about how our corporate tax rate compares to other nations. He may be saying it 'all over the internet' but not in your example. Here is says it used to account for a higher percentage of federal revenue than it does now. No mention of other countries. I was using that as an example. Do you want me to find a better one, or will you accept that actual point of my post -- that the problem according to Sanders is that we don't have a high enough corporate rate? Of course, you could argue that Sanders also wants to do away with the corporate tax. I don't think that's his point, but you could argue that direction if you really want to rebut my initial post. I get your point, and I don't care if you bother to dig up another example or not. I am just cranky enough to think that when you use an example, it should be an example of what you say it is.
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Post by PaulKay on Sept 3, 2014 16:30:28 GMT -5
So I sent this post text to my representative... Paul Ryan. And low and behold I got a reply. But unfortunately it was mostly just his current policy position reiterated. Probably done by a staffer. But at least they took the time to reply...I'll give them that. I guess it was too much to ask that it change his thinking on the issue or address it directly. CONSTITUENT HOTLINE: 1-888-909-RYAN (7926) paulryan.house.gov | RSS | YouTube | Twitter Paul Kucharski W316S8811 Laurens Parkway Mukwonago, WI 53149-8250 Dear Paul: Thank you for contacting me with your thoughts regarding tax reform. I appreciate you taking the time to share your views on this important issue. There are countless challenges facing our nation. It is nearly five years after the financial crisis, and many families have still not recovered. Economic growth is too slow, too many families are stuck in foreclosure, students continue to struggle with meeting their tuition payments, and millions are seeing their medical care costs skyrocket as a result of President Obama's health care law. Unfortunately, President Obama and his party have turned to more taxes, more spending, and more regulation. And, as we have seen, maintaining the status quo has not improved the economy. President Obama and Congressional Democrats promised if Washington took a firmer hold of the economy, working families would be better off. However, in the first few years of his administration, the economy grew at less than half the average of all other recoveries since World War II. Meanwhile, the national debt continues to climb. In May 2013, the Congressional Budget Office (CBO) projected the federal government would add $6.3 trillion to the national debt from 2014 to 2023. But in February 2014—not even a year later—the CBO revised its forecast to $7.3 trillion—a $1 trillion increase. Currently, our national debt is well above $17 trillion. Without action, our country will face a debt crisis that will stall our economy and destroy the safety net that protects those who are the most vulnerable. This debt crisis is one of the most pressing problems we face today. Fortunately, it is not too late for us to reverse course. For four consecutive years, I have introduced and passed budget resolutions that would tackle the looming debt crisis and restore economic growth. The budget that my House colleagues and I recently introduced for Fiscal Year 2015, "The Path to Prosperity: a Responsible, Balanced Budget" offers an alternative that will provide for the nation's needs, allow families and job creators to rebuild the economy, and finally balance the budget. The Path to Prosperity will reduce our deficits by $5.1 trillion over ten years. On the current path from fiscal year 2015 to fiscal year 2024, spending will grow, on average, by 5.2 percent per year. Under this budget, spending will grow, on average, by 3.5 percent per year—which is hardly draconian despite what critics often claim. Among other things, this budget will cut wasteful government spending, fix our broken tax code, protect and strengthen important priorities like Medicare and national security, and reform welfare programs like Medicaid to ensure that they are available to those in need. By balancing the budget and tackling our debt, the Path to Prosperity will grow our economy today and ensure our children and grandchildren inherit a stronger, more prosperous America. Specifically, The Path to Prosperity would simplify the tax code to make it fairer for American families and businesses. Our plan would reduce the corporate tax rate to 25 percent and transition the tax code to a more competitive system of international taxation, creating a level playing field between American businesses and their foreign competitors, which would help keep jobs in the U.S. The tax code for individuals would also be simplified, consolidating the current seven individual-income-tax brackets into two brackets—setting the first bracket at 10 percent and the top bracket at 25 percent. Economists have shown that lowering overall rates and broadening the tax base will promote economic growth and support job creation the private sector. By implementing these reforms to our tax code, we can protect the American dream for generations to come. Our tax system should be simple, fair, and promote economic growth; but the U.S. tax code fails on all three counts. It is notoriously complex, patently unfair, and highly inefficient. The tax code's complexity distorts decisions to work, save, and invest, which leads to slower economic growth, lower wages, and diminished job creation. It is estimated that individuals, families, and employers spend over 6 billion hours and over $160 billion a year trying to understand a labyrinth of rules. Over the past decade, more than 4,400 changes have been made to the tax code, which averages to more than one per day. This budget proposes to solve these problems by calling for a reformed tax code. Currently, the U.S. corporate tax rate is just over 39 percent—the highest rate in the industrialized world. Additionally, the top federal rate on smaller, unincorporated businesses reaches 44.6 percent. Roughly half of all U.S. active business income and half of private-sector employment are derived from these businesses—such as partnerships, S corporations, and sole proprietorships. These high tax rates discourage investment and job creation, distort business activity, and put American businesses at a competitive disadvantage. It is also important to note that in Wisconsin; approximately 9 out of 10 businesses file their taxes as individuals. These small businesses, known as "sub-chapter S corporations," limited liability corporations (LLCs) and partnerships employ more than half of all private sector workers. With two-thirds of the net new jobs in America being created by small businesses, raising taxes on these businesses would kill job creation—especially at a time when some of our foreign competitors are lowering their tax rates on business as low as 15 percent. By making the tax code more conducive to innovation and investment, we can stimulate job growth and get the economy back on the road to recovery. This budget came before the House on April 10, 2014, and was passed by a vote of 219 – 205. I was encouraged that my colleagues chose to support commonsense spending restraint, much-needed economic growth, and a balanced budget. Ultimately, a budget is more than just a list of numbers: it is an expression of our governing philosophy. This budget offers the American people a brighter future. It would stop spending money we do not have, create jobs, and expand economic opportunity. And most importantly, it would restore the promise of this exceptional nation. I understand that not everyone shares my views on how to address the challenges facing our nation, and I respect these differences of opinions. Although some of us may disagree, I am committed to civil debate and a desire to overcome our nation's greatest financial and economic challenges. This budget is offered in recognition of that need—and in a spirit of good will. Thank you again for sharing your thoughts with me . To read more about this budget, you are welcome to visit the House Budget Committee website: budget.house.gov/fy2015/ . Again, if you wish to share additional information with me, please feel free to contact me by calling, emailing, writing, or faxing me. You are also welcome to visit my website: paulryan.house.gov/ , which has regular updates on my actions in Congress. Please be advised that mail sent to my Washington office is subject to an additional two-week delay due to increased mail security. Thank you again for reaching out to share your views. I am always happy to respond and be of service to you. Sincerely, Paul Ryan Serving Wisconsin's 1st District
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Post by Doug on Sept 3, 2014 18:07:17 GMT -5
I didn't realize that Ryan was a left wing socialist.
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Post by lar on Sept 3, 2014 21:24:47 GMT -5
For just a minute or so I'd like to get back to the post that started this whole converstaion. It suggested that we tax corporations on their assets rather than their income.
The problem with that idea is that many corporations have few, if any, actual assets other than inventory and accounts receivable. Some time ago business woke up to the idea that you could buy assets, fixed assets that is, but you couldn't invest in them. A dollar removed from the company's assets stops working. It just lays there doing nothing.
Conversely, a company that rents/leases equipment and real estate keeps it's cash assets employed.
Yes, inventory and accounts recievable can be and are taxed (property tax; and in many places that doesn't simply include real property).
I work for a capital equipment manufacturer. Some of our sales are outright purchases but quite a number are financed via leases. We don't lease but our customers who are seeking leases find their own financing.
I would also like to comment on the idea of moving manufacturing operations to other countries. China is a big one these days because of their location and the potential of their economy.
In the 60s Milwaukee was one of the industrial centers of the country. In the 70s the large manufacturers began to relocate to the sun belt. There were tough economic times around here for a while. Gradually manufacturing started up again. Not on the same scale but while the companies were smaller there were a lot more of them. Milwaukee had a ready and skilled workforce. Thousands of people went back to work, 30 or 40 at a time.
The same kinds of things have been happening since manufacturing moved offshore. Yes, jobs have been lost. Many have been replaced.
One thing that is not commonly known is that the dirty word "multinational firm" now applies almost as much to companies with a handful of employees as it does to the big guys.
In our industry, for example, we have found that the cost of shipping a 30,000 to 40,000 pound piece of equipment across the ocean prices our equipment out of the market in the Pacific Rim countries. So we have a plant in China and aother one in Thailand. They aren't taking American jobs. In fact they are creating them.
Those Asian plants sell to Asian customers; China, Cambodia, Viet Nam, South Korea, you name it. Our company would not be able to sell equipment in those places. It would be too expensive for two reasons; shipping costs and quality. The Asian markets are far less quality concious than the domestic market.
How does this create jobs in Milwaukee? It doesn't cost much to ship brain power across the ocean. Most of our products, regardless of where they are built, are engineered in Milwaukee. We may not have as many factory workers but we do have engineers. Interestingly enough we have found that not only is the build quality in Asia lower than is acceptable in the U.S. but the Chinese engineers we employ are simply not as skilled as their American counterparts.
The reason I mention all of this is that the issue of companies locating manufacturing facilities overseas is far more complicated than many people realize. In manufacturing the American workforce used to be employed by a relative handful of very large companies. Today, that workforce is employed by thousands of companies. Do the words "too large to fail" from our recent economic woes sound familiar. We still have too many companies that fit that description but not nearly as many as there used to be.
Many of the manufacturing jobs that are said to have been exported, were unskilled jobs. That's particularly true in the textiles industry. The jobs that exist here increasingly call for higher skill levels and technical expertise than those jobs that are now being performed overseas. And the pay rates are comensurate with that.
All is not either hunky or dory but the situation is not as grim as many would paint it to be.
As for taxing corporations; why shouldn't they be taxed? Arguing the tax rate doesn't come close to addressing the real issues. The tax rate may be high but corporations have lots of ways to minimize income, and therefore, taxes. Those companies that do buy fixed asset have a depreciation write off. They write off the interest on their debt. They are given tax incentives for investing in more workers and in upgrading equipment.
In theory I am for a flat tax. No deductions, no social engineering via the tax code. Just a flat tax. But (there's always a "but" isn't there?) what happens when something like that is introduced? Government would have to find a way to fund those things that are now funded by special sorts of taxes (like the fact that your employer now pays for half of your social security). How about corporate philanthropy? Does no more deduction mean no more funds for that? And that's only the tip of the iceburg.
The tax code is ridiculously bloated and complex. It should never have gotten to this point in the first place and it needs to be fixed. But I'm not convinced that any of the propose fixes are going to make anything better and I'm very concerned that in the process the burden is going to be shifted. Let's face it, government is not going to stop spending anytime soon and the money has to come from somewhere.
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Post by Deleted on Sept 3, 2014 21:34:04 GMT -5
I didn't realise that Lar was an anarcho-syndicalist
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Post by lar on Sept 3, 2014 21:52:03 GMT -5
I didn't either, James. Perhaps because I don't even know what that is. However, if it doesn't involve physicla pain, is pleasant, has no dues or commitments and impresses single ladies; I'm in!
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Post by Deleted on Sept 3, 2014 21:57:37 GMT -5
I'm not fit to engage you on matters economical Lar but I'm totally down with your rules for recreation.
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Post by lar on Sept 3, 2014 22:04:28 GMT -5
I wouldn't say that I know much about economics. My approach tends to be from inside the trenches rather than sitting on the outside looking in.
I find a lot of things economists say to be fascinating until I sit down and try to look at it from a real world perspective. I never seem to be inhabiting the same world they are.
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Post by Doug on Sept 3, 2014 22:45:00 GMT -5
Because no corporation ever pays any tax they just pass it on to the consumer. And if they are a food corp or other that makes products for the poor then you are just taxing the poor.
But I don't see how a bunch of taxes are constitutional. I mean taxing any communication device, company, or product is a violation of the first amendment. The ability to tax is the ability to destroy. And taxing paper, books, computers, pens, internet service etc is abridging the freedom of speech.
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Post by PaulKay on Sept 4, 2014 8:51:37 GMT -5
For just a minute or so I'd like to get back to the post that started this whole converstaion. It suggested that we tax corporations on their assets rather than their income. The problem with that idea is that many corporations have few, if any, actual assets other than inventory and accounts receivable. Some time ago business woke up to the idea that you could buy assets, fixed assets that is, but you couldn't invest in them. A dollar removed from the company's assets stops working. It just lays there doing nothing. Conversely, a company that rents/leases equipment and real estate keeps it's cash assets employed. Yes, inventory and accounts recievable can be and are taxed (property tax; and in many places that doesn't simply include real property). I work for a capital equipment manufacturer. Some of our sales are outright purchases but quite a number are financed via leases. We don't lease but our customers who are seeking leases find their own financing. I would also like to comment on the idea of moving manufacturing operations to other countries. China is a big one these days because of their location and the potential of their economy. In the 60s Milwaukee was one of the industrial centers of the country. In the 70s the large manufacturers began to relocate to the sun belt. There were tough economic times around here for a while. Gradually manufacturing started up again. Not on the same scale but while the companies were smaller there were a lot more of them. Milwaukee had a ready and skilled workforce. Thousands of people went back to work, 30 or 40 at a time. The same kinds of things have been happening since manufacturing moved offshore. Yes, jobs have been lost. Many have been replaced. One thing that is not commonly known is that the dirty word "multinational firm" now applies almost as much to companies with a handful of employees as it does to the big guys. In our industry, for example, we have found that the cost of shipping a 30,000 to 40,000 pound piece of equipment across the ocean prices our equipment out of the market in the Pacific Rim countries. So we have a plant in China and aother one in Thailand. They aren't taking American jobs. In fact they are creating them. Those Asian plants sell to Asian customers; China, Cambodia, Viet Nam, South Korea, you name it. Our company would not be able to sell equipment in those places. It would be too expensive for two reasons; shipping costs and quality. The Asian markets are far less quality concious than the domestic market. How does this create jobs in Milwaukee? It doesn't cost much to ship brain power across the ocean. Most of our products, regardless of where they are built, are engineered in Milwaukee. We may not have as many factory workers but we do have engineers. Interestingly enough we have found that not only is the build quality in Asia lower than is acceptable in the U.S. but the Chinese engineers we employ are simply not as skilled as their American counterparts. The reason I mention all of this is that the issue of companies locating manufacturing facilities overseas is far more complicated than many people realize. In manufacturing the American workforce used to be employed by a relative handful of very large companies. Today, that workforce is employed by thousands of companies. Do the words "too large to fail" from our recent economic woes sound familiar. We still have too many companies that fit that description but not nearly as many as there used to be. Many of the manufacturing jobs that are said to have been exported, were unskilled jobs. That's particularly true in the textiles industry. The jobs that exist here increasingly call for higher skill levels and technical expertise than those jobs that are now being performed overseas. And the pay rates are comensurate with that. All is not either hunky or dory but the situation is not as grim as many would paint it to be. As for taxing corporations; why shouldn't they be taxed? Arguing the tax rate doesn't come close to addressing the real issues. The tax rate may be high but corporations have lots of ways to minimize income, and therefore, taxes. Those companies that do buy fixed asset have a depreciation write off. They write off the interest on their debt. They are given tax incentives for investing in more workers and in upgrading equipment. In theory I am for a flat tax. No deductions, no social engineering via the tax code. Just a flat tax. But (there's always a "but" isn't there?) what happens when something like that is introduced? Government would have to find a way to fund those things that are now funded by special sorts of taxes (like the fact that your employer now pays for half of your social security). How about corporate philanthropy? Does no more deduction mean no more funds for that? And that's only the tip of the iceburg. The tax code is ridiculously bloated and complex. It should never have gotten to this point in the first place and it needs to be fixed. But I'm not convinced that any of the propose fixes are going to make anything better and I'm very concerned that in the process the burden is going to be shifted. Let's face it, government is not going to stop spending anytime soon and the money has to come from somewhere. I agree that there are many companies that don't have a lot of assets to tax, that was why I included the idea of a value added tax to the stuff they make as well. VATs are common in Europe, but frowned upon here. I see it as a way to level the playing field for company taxation regardless of where the stuff is made. As for moving production off shore, I agree that companies that relocated factories to be close to the customer makes sense. But there are far more who just move off shore and import the stuff back into the country to sell. Those are the ones that are doing the most harm to jobs in the U.S. I can't fault them for doing it in their own interest, but it doesn't change the macroeconomic impact.
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Post by lar on Sept 4, 2014 21:22:36 GMT -5
VAT or sales tax. In the end it's the same thing. The idea is that economic value is added when a manufacturer converts raw materials or an assemblage of parts into a different form. And that's true. Economic value is created. However, during the process of that value creation jobs are created and taxes are paid by workers who produce the product, by the owner of the real estate the plant sits on, by the utlities that sell power, water, phone and internet services to the company, and sales tax on consumables purchased by the ccmpany but that are not directly used in the manufacturing process.
There is an argument that by virtue of their existence and productivity companies already contribute mightily to tax revenue.
I believe the discussion shounot be about what taxes ought to be collected and how they should be collected. It's moot. Taxes don't lead the parade. They follow. Government decides what it wants to spend and then attempts to adjust revenues accordingly. Along they way the've allowed other things to invade the process. We've used the tax code to promote a variety of ideas and to create a disincentive to people who don't behave in an approved manner.
What needs to be discussed is the idea of what constitutes a fair tax rate. I don't have any hard and fast ideas about that. Like most people I believe that I sacrifice a larger portion of my income to taxes than I should. And I believe I'm justified in feeling that way.
Just think, if a "fair" rate was introduced and then left alone (something politicians hate to do) it would automatically index itself to inflation and to changes in the economic climate. Government would then need to budget according to it's income level as opposed to the present method of spending as much as it thinks it can get away with.
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Post by Doug on Sept 4, 2014 21:26:26 GMT -5
The only fair tax rate is if every individual pays the same amount. Anything else is social engineering.
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