A community of 30,000 US Transcriptionist serving Medical Transcription Industry

Taxing the richest and the deficit


Posted: Nov 12, 2010

From Robert Reich-Christian Science Monitor

The economics are clear:

First, the top 1 percent spends a much smaller proportion of their income than everyone else, so there’s very little economic stimulus at these lofty heights.

On the other hand, giving the top 1 percent a two-year extension would cost the Treasury $130 billion over two years, thereby blowing a giant hole in efforts to get the deficit under control.

Alternatively, $130 billion would be enough to rehire every teacher, firefighter, and police officer laid off over the last two years and save the jobs of all of them now on the chopping block. Not only are these people critical to our security and the future of our children but, unlike the top 1 percent, they could be expected to spend all of their earnings and thereby stimulate the economy.

Their incomes of the top are already soaring (Wall Street is reading a 5% boost in bonuses, executive salaries and perks are back on the trajectory they were on before the collapse, and the stock market is booming), so it’s hard to argue much hardship.

Besides, only earnings over $500,000 would be affected because — remember — we’re talking about the marginal tax rate.

Finally, the Bush tax cuts didn’t trickle down anyway. To the contrary, between 2001 and 2007, the median wage dropped. And Bush’s record on jobs was pitiful.

The top 1 percent now takes in almost a quarter of all national income (up from 9 percent in the late 1970s), and its political power is evident in everything from hedge-fund and private-equity fund managers who can treat their incomes as capital gains (subject to a 15 percent tax) to multi-million dollar home interest deductions on executive mansions.

;

Would you say it would be fair for everyone to - pay the same percentage?

[ In Reply To ..]
Just a question. People really have a big problem with the rich not paying more taxes (even thought they are the ones paying most of our taxes now), so do you think that maybe everyone should have to pay the same percentage on what they make. Wouldn't that be fair? Just think of how many people recieve huge income tax checks with all that they payed in plus a few thousand for the earned income credit. Wonder how many teachers, firefighters, police officers they could rehire. We all know that will never happen, though.

I like the idea of a straight percentage....I am also interested... - sam

[ In Reply To ..]
a consumption tax vs. an income tax. That way people on welfare would have to pay a tax on the TVs and stuff they buy like the rest of us. In other words..pay their own way whether working a minimum wage job or sitting on the couch. Anyone who consumes anything would be contributing to the tax base. Those who consume more, pay more. The rich will still pay more because they buy the high dollar houses, the high dollar cars, etc.

Seems that a consumption tax is more fair across the board. Of course, Democrats (the ones in charge) don't like that, because you can't apply class warfare to it in order to keep people poor and on a check (and in their voting base).

Reality bites.

Correct me if I'm wrong but are you saying - Backwards Typist

[ In Reply To ..]
those on welfare don't pay taxes on TVs? Why not?

Are you essentially speaking of a cap-and-trade tax? That would hit everybody for as many times as manufacturers buy and/or sell a product. That would catch every consumer...and more than once.
No, what I meant was that we would all be paying... - sam
[ In Reply To ..]
the same tax...none of us would pay income tax and all of us would pay a consumption tax (probably wrong word...also called national sales tax...means that every person who buys anything in the US is taxed on it...illegals included). One replaces the other. I believe it is intended on new items only, not used items. Most lower income folks buy used cars...would not be taxed. A "used" house vs. a new house...not taxed. And the plan I saw did have rebates for the lowest tax bracket so they would essentially not pay much at all if any in taxes, the same way they do now. That would be offset (there is no offset now other than trying to make it up by taxing the upper tiers so much they end up offshoring) by everyone in the US who buys anything adding to the pot. Now we have millions who don't, either illegal, through loopholes, etc. That has nothing to do with cap and trade the way I understand cap and trade.

The other alternative would be a flat tax and I am not opposed to that either. I think our present tax system is severely broken. It is convoluted, it is not fair across the board, and I for one think it should change. Just my opinion, of course.

I also think that any raise in taxes of ANY kind at the federal level should be put to a vote of the people like it is in states, counties, etc., as long as our "representatives" seem to have a penchant for not listening when we say no.

I think the author should go back to the drawing board and research - Backwards Typist

[ In Reply To ..]
This article was copied from someone else's article. I know I read it somewhere else, and I didn't agree with it then and I don't agree with it now.

Who do you know that spends all their earnings? I don't know of anyone that does that, except those that are oblivious to the problems of today.

Teachers, firefighters, and police jobs were saved by the stimulus when the government gave states the funds to apply to those jobs, so they didn't have to lay off the above. The only ones that may have lost their jobs were the ones that didn't cut it and were laid off.

The Bush tax cuts did trickle down. Between June 2003 and July 2007 (after the dems started their partisanship policies - the party of No back then), was 4.2%, which rose to 7.2% after the dems took office. After that, we all know where unemployment went.

Finally, the mansions and capital gains - the rich have every right to claim the mortgage deduction just like you and I. Capital Gains is treated as income and is taxed over and above regular income. If the rich are paying #35% in income taxes, add another 15% in capital gains taxes. If you or I would sell something that gained in value, we would be taxed the same. They get no extra benefit out of claiming capital gains.

Excellent post! I learned some things here. Thanks... - sam

[ In Reply To ..]
for posting!

Similar Messages:


IRS Boosted Auditing Of Richest Taxpayers Last YearApr 05, 2011
Geez, make Congress close the loopholes and they wouldn't have to work as hard trying to find money. IRS BOOSTED AUDITING OF RICHEST TAXPAYERS, ALMOST DOUBLING RATE LAST YEAR The Internal Revenue Service audited 18.4 percent of taxpayers reporting income above $10 million last year, up from 10.6 percent the previous year. Audit rates increased in 2010 for all income groups, except for people with no adjusted gross income, according to data released today in Washington ...

Taxing BusinessesDec 13, 2012
An article on NPR talking about how added tax on some small businesses could lead them to hire more people or buy new equipment.  It also talks about the flip side, how for some small businesses, the tax would make it harder for them to expand. "For some 97 percent of small business owners, that higher rate is irrelevant. They make less than $250,000 a year. And for those whose income works out to be just over that threshold, one way out of paying that higher tax rate could be to hire on ...

Taxing People Who Need BracesFeb 01, 2013
braces will cost more now due to ObamaCare's tax on "medical devices."  ...

Now, Congress Moving On To Taxing The Internet.Apr 18, 2013
I don't care how, just go. ...

Deficit QuestionDec 14, 2016
can anyone explain why the deficit/debt got so much worse while obama was president?   ...

Republicans Trying To Deepen DeficitJan 06, 2011
Health-Law Repeal Would Deepen Deficit, CBO Estimates January 06, 2011, 10:33 AM EST By Anna Edney Jan. 6 (Bloomberg) -- Repealing the health-care overhaul law would deepen federal budget deficit by $145 billion from 2012 to 2019, the Congressional Budget Office estimates. Individual insurance premiums would be “somewhat lower” than under current law, while coverage obtained through large employers would be “slightly” higher under an overhaul repeal, the CBO, the ...

Bipartisan Deficit CommissionFeb 06, 2010
Last month, a bipartisan commission went down in flames in the Senate after 7 republicans who sponsored the bill voted against it. Now, Obama is putting together a bipartisan commission and the republicans are still complaining it's not good enough. Obama is telling them to come to the table and present their ideas. They are saying no. And then accusing him of not listening. The problem seems to be that the republicans expect Obama to follow their platform (tax breaks for big busines ...

U.S. Deficit Commission Recommends Changes To SSNov 10, 2010
(The true suggestions will be coming out on Dec. 1.) U.S. Deficit Commission Recommends Changes to Social Security A draft proposal by the deficit commission suggests curbing Social Security benefits and raising the retirement ageto 68. It is currently 67 years for retirees to receive full benefits. The panel leaders also propose reducing the annual cost-of-living increases in Social Security. The increase to age 68 would be implemented by 2050 and then would increase again to 69 by 2075.&n ...

Tackling The Deficit-Fix-It WeekJun 29, 2010
The first of the series this week. http://www.msnbc.msn.com/id/31510813/#37983994 ...

CBO Deficit Projections That Just May Suprise You.Jul 14, 2010
Here is a graph depicting baseline deficit as affected by the economic downturn with comparisons made between the percentages of projected impacts (2009 to 2019) of the wars in Iraq and Afghanistan, the Bush tax cuts, Obama's recovery measures, TARP, Fannie and Freddie.  Can you guess which one has the broadest and most far reaching damaging impact?  Fascinating stuff.  http://www.cbpp.org/cms/index.cfm?fa=view&id=3036     ...

11 Things The GOP Doesn't Want You To Know About The Deficit...smSep 08, 2012
1.  The deficit has grown mostly because of the recession. (The deficit has ballooned not because of specific spending measures, but because of the recession.  The deficit more than doubled between 2008 and 2009 as the economy was in free fall and laid-off workers paid less in taxes and needed more benefits.  The deficit then shrank in 2010 and 2011.) 2.  The stimulus cost much less than Bush's wars and tax cuts.  (Republicans frequently have blamed the $787 billio ...

Candidates' Deficit Plans Don't Add UpOct 01, 2012
As the government closes the books Sunday with a $1.1 trillion deficit for the year, which required borrowing 32 cents for every dollar it spent, budget analysts have little confidence in either presidential candidate's plan to address the accumulating debt, now at about $16 trillion. The Republican nominee promises to balance the budget in eight years to 10 years, but he also offers a mix of budgetary contradictions: higher Pentagon spending, restoring cuts that Democrats made in Medicare ...

Anyone Have A Child Or Know About Attention DeficitOct 20, 2014
Was just talking with my friend tonight. I have known as she has also for years that her 1st grader was not 100% "right," something was off with him. Tonight she tells me someone is finally maybe listening to her about him. He is in his own little world. I do not think autism because of the fact he will halfway interact "sometimes," does not reject a hug or kiss and maybe I am wrong but I thought autistic children were like that. I could be wrong. His teacher is every day trying to tell the moth ...

Deficit Commission Final VoteDec 03, 2010
Guess it's back to the drawing board. It's true that a commission that began with only limited authority failed in its most significant goal, which was to win at least 14 votes among the 18 members. Fourteen votes were needed to send the package to Congress as an official recommendation and force a vote on the proposals. It's also true that prominent members of Congress on the committee took a walk on the commission report. That group included Rep. Paul Ryan (R-Wisc.), who will ...

Comission Gives More Details On Cutting The DeficitNov 11, 2010
I have a feeling these suggestions won't go very far....especially the gas tax. If it isn't the people against some of the cuts, it will definitely be the federal employees against a wage freeze. I think the Congress will also be against their pet earmarks.  In my opinion, I think the federal employees could and should allow a wage freeze. The rest of America had to swallow it, why shouldn't they? As for earmarks, I think only the frivolous ones, like the ones stu ...

More Good News! Jobs Up, Deficit Down!Oct 07, 2012
The Congressional Budget Office has released its estimate for the fiscal year 2012, just ended on September 30 and the news is good. The federal deficit was just under $1.1 trillion, compared to just under $1.3 trillion at the end of fiscal year 2011, a reduction of $207 billion. As a percentage of the GDP, the 2012 deficit dropped to 7.0 per cent, down from 8.7 percent in 2011 and 9.0 percent in 2010. The actual deficit numbers will be released later this month by the Treasury DepartmentThe Sep ...

Budget Deficit Shrinks By $200 BillionOct 13, 2012
It starts with the figures released in 2009, when the deficit reached a record high of $1.4 trillion. Why is the column in red? Because, thanks to fiscal years, Obama inherited a deficit of nearly $1.3 trillion from Bush/Cheney the moment he took the oath of office. This year, however, according to the official data published by the Treasury Department, the deficit is 1.089 trillion.   A big number, but going down--no thanks to those helpful Republicans in Congress. ...

A Progressive Deficit Reduction Plan....smNov 29, 2012
A Progressive Deficit Reduction Plan Repeal all of the 2001 and 2003 Bush tax breaks for the top two percent.  Repealing the 2001 and 2003 tax breaks for the top two percent would reduce the deficit by about $1 trillion over the next decade.  After President Clinton increased taxes on the top two percent, the economy added over 22 million jobs.  After President Bush reduced taxes for the rich, the economy lost over 600,000 private sector jobs.  Create an emergency de ...

Some Interesting Articles On Cutting The Budget DeficitNov 28, 2010
All these articles are quite long but are worth reading every word. Remember, nothing is written in stone. All can be tweaked. I found some of the ideas very good, and some 'not so good.' All in all, it's good that there's plenty of input happening and hopefully, our government will READ (if that's possible) them and debate/compromise on them. The first one is from the Brookings Institute which gives quite a few plans from various Senior Fellows: http://www.brookings.e ...

Bernake Sounds Warning On Growing DeficitApr 14, 2010
Federal Reserve Chairman Ben S. Bernanke warned Wednesday that Americans may have to accept higher taxes or changes in cherished entitlements such as Medicare and Social Security if the nation is to avoid staggering budget deficits that threaten to choke off economic growth. "These choices are difficult, and it always seems easier to put them off -- until the day they cannot be put off anymore," Bernanke said in a speech. "But unless we as a nation demonstrate a strong commitment to fiscal re ...

CBO Finds Dem Bill With Public Option Reduces Deficit Oct 21, 2009
http://www.cnn.com/2009/POLITICS/10/21/health.care.cbo/index.html   ...

Cool Debt Clock. Watch Our Deficit Rise.Mar 23, 2011
On the left side is also more statistics on unemployment real and reported, births, etc. Near the bottom is corporate assets, small business assets, personal assets. There's also a lot more. Check it out. The moving numbers may get ya dizzy, though.    http://www.usdebtclock.org/ ...

Deficit Recution Commisions Seeks Increase In Its BudgetJun 08, 2010
I find this hilarious (for want of a better word).  It was a twitter that flashed by and I was curious so went to the site.   The whole article is in PDF here: http://taxprof.typepad.com/files/tax-notes-today_-2010-tnt-1...pdf   Deficit Reduction Commission Seeks Increase in its Budget Eric Kroh, Fiscal Commission Bemoans Lack of Resources, 2010 TNT 106-2 (June 3, 2010): Saddled with a tight deadline and great expectations, members of President Obama's deficit reducti ...

Budget Deficit/Econ Growth In Plain SpeakSep 28, 2012
Sharp kid. See link.  ...

Senator Lieberman Calls For Obama To Be More Involved In Deficit NegotiationsDec 03, 2012
Sen. Lieberman calls for Obama to be more involved in deficit negotiations By Alexander Bolton - 12/02/12 06:00 AM ET Sen. Joe Lieberman (Conn.), the independent Democrat who has played roles in past Senate compromises, says President Obama needs to get more involved in the fiscal cliff talks. Lieberman, who brought Republican senators on board with the 2009 economic stimulus package and a 2005 deal on judicial nominees, says it’s time for Obama to gather congressional leaders arou ...

David Axelrod Smacks Karl Rove’s ’shamelessness’ On DeficitJan 16, 2010
By Sahil KapurFriday, January 15th, 2010 -- 9:17 am President Barack Obama's chief political strategist on Friday slammed his Bush administration counterpart Karl Rove for allegedly making up "his own facts" about Democrats. In an op-ed published in the Washington Post, David Axelrod accused Rove of hypocrisy and "shamelessness" for insinuating Sunday in a Post expose that Congressional Democrats "will run up more debt by October than Bush did in eight years." "[G]iven the shape in which ...