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Avatar of GI KoreaBy on September 21st, 2011 at 5:06 pm

Are the Rich In the US Paying Enough Taxes?

» by in: Politics-US

Here is a fact check from the AP on the often heard rhetoric that the rich don’t pay enough taxes:

President Barack Obama says he wants to make sure millionaires are taxed at higher rates than their secretaries. The data say they already are.

“Warren Buffett’s secretary shouldn’t pay a higher tax rate than Warren Buffett. There is no justification for it,” Obama said as he announced his deficit-reduction plan this week. “It is wrong that in the United States of America, a teacher or a nurse or a construction worker who earns $50,000 should pay higher tax rates than somebody pulling in $50 million.”

On average, the wealthiest people in America pay a lot more taxes than the middle class or the poor, according to private and government data. They pay at a higher rate, and as a group, they contribute a much larger share of the overall taxes collected by the federal government.

The 10 percent of households with the highest incomes pay more than half of all federal taxes. They pay more than 70 percent of federal income taxes, according to the Congressional Budget Office.  [Associated Press]

This argument about the rich not paying enough taxes is really annoying me because overall the rich are paying their fair share in taxes.  A more accurate argument would be that some of the rich are not paying their fair share just like some people in other income brackets are not either.

If you read the rest of the article it explains how rich people that live off investment income like President Obama’s buddy Warren Buffet who pays only 15% in taxes on that income.  If Warren Buffet paid himself a salary he would be taxed at the 35% level.  Very few people are wealthy enough to do this and thus the reason why overall the rich are paying their fair share.  At the same time the article also points out how 46% of taxpayers pay no income tax after deductions.

It seems to me that to solve the income tax versus capital gains tax problem with people like Warren Buffet is to charge them at a higher level for the capital gains tax if they are paying no income tax.  Maybe 20%?   As far as people paying no income tax it seems to me that everyone should at least pay something in tax.  Maybe there should be a tax reform to where everyone has to pay at least 5% in income tax after deductions?

I also think that letting the Bush tax cuts expire is a good idea when combined with a drop in the capital gains tax to maybe 10%?  I think this would cause people to invest money knowing that they are paying less in capital gains taxes to compensate for their increased income taxes?

Anyone have any better ideas other than playing the class warfare card?

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  • JoeC
    6:56 pm on September 21st, 2011 1

    “As far as people paying no income tax it seems to me that everyone should at least pay something in tax.”

    Everybody does pay taxes. Just in different proportions on different scales.

    The very rich pay less on income taxes because less of their wealth comes from income and they earn and keep most of it in investments and assets.

    The upper middle class’s wealth is progressively more in income and less in investments and assets. They ‘feel’ the income tax more.

    That lower 46 percent paying no ‘income’ taxes with deductions are the people who see themselves as just getting by. Many of those deductions, which generally are offered to everyone, are more significant to them to help them compensate for burdens, losses and offer them incentives to reach for that next level of investment and asset holders that can pay more taxes.

    But those lower end ‘non-tax-payers’ still pay taxes. They are subsistence purchasers of gas and food and all other goods, services and commodities that are taxed. They are contributors to and simulators of the economy. Even when you give people unemployment compensation it still goes back into the economy.

    So, you see, taxes really are progressive all up and down the scale. It’s just convenient for some people to get caught up on the part we call ‘income’ tax.

    BTW. That suggestion about increasing capital gains tax could turn the mob against you in some parts.

  • someotherguy
    7:29 pm on September 21st, 2011 2

    For one GI, get your class distinctions straight. “Rich” usually refers to upper class not middle / upper middle class. Middle / upper middle pays plenty in taxes, sometimes I think too much, Upper class pays near nothing in taxes.

    “his argument about the rich not paying enough taxes is really annoying me because overall the rich are paying their fair share in taxes.”

    Are you familiar with how this works in real life? They don’t pay 15% tax, they pay 0~4% if that. It’s only 15% if they take it OUT of the fund as cash via selling, if it’s left inside it’s 0% and if they transfer / swap it then it’s 0%. Financing managers have been using this trick to pay essentially near zero tax for a very long time.

    It goes like this.
    You make $20,000,000 in a year from your hedge fund (private fund not required to report assets). Now if you take out that $20,000,000 then you must pay 15% or $3,000,000. But if you leave it in then for that year you pay $0 and can use the money to grow the fund further.

    But you need to pay the rent on your apartment, and the lease on your car, and food, any bills, and buy things. If your not getting the money from your fund then where do you get cash? Simple you borrow it.

    Go to your friendly bank, usually the holding the value of the fund. Take a secure loan out for $10,000,000 against the value of your fund. Now since the loan is secured against the fund, the interest is ridiculously low, barely above prime rate. And *BAM* now you have money to pay for things.

    But you say, you need to pay back that loan, and you will. At the end of the next year, you claim the $10,000,000+interest as a deduction against the capital gains of $10,500,000 (and whatever extra for the interest). All those things you spent that $10,000,000 on would be claimed as expense deductions for your business, you’d only have to pay taxes on the money required to pay for things you couldn’t find a pay to claim as expenses. Essentially you’ll pay 15% tax on $500,000, or $75,000.

    Now this all requires an immense amount of paperwork, and your going to need an expert accountant to work the numbers so that everything is an “expense”, these aren’t cheap. Assuming $10,000 retainer fee per month, plus an additional $5,000 per month of costs and $20,000 additional costs during “tax time”, you’d pay $200,000 per year for accounting fee’s. Per year your paying $275,000 in expenses instead of $3,000,000 (slightly higher due to needing similar accounting just to manage it). That is a %1090.9 reduction in costs.

    The kicker, none of this is available to you unless you have a few million USD to put into that hedge fund. A HF manager won’t even talk to you unless your offering six digit numbers, and they won’t take you seriously unless your offering seven digits.

    This is how the “rich” stay rich, they have the financial resources to hire the experts that know how to work the library sized tax code to ensure they pay the absolute least. They hire the people required to file the volumes of paperwork, who can spend the weeks worth of man-hours tabulating and computing everything, tracking and manipulating. And then they have the financial clout and resources to ensure the politicians stay on their side whenever they create new tax laws.

  • wamille
    7:31 pm on September 21st, 2011 3

    Is invested money not taxed first? If so, then the money invested is being taxed twice, correct? The first tax coming through income gained from employment, and the second time that money is taxed is upon realizing the capital gain. So a rich person pays 35% on income and 15% on any capital gain.

    Regarding those with massive amounts of invested capital… what happens when they lose money in the market? Is there a capital loss where they can recoup that money?

  • someotherguy
    7:43 pm on September 21st, 2011 4

    “Is invested money not taxed first? If so, then the money invested is being taxed twice, correct? The first tax coming through income gained from employment, and the second time that money is taxed is upon realizing the capital gain. So a rich person pays 35% on income and 15% on any capital gain.

    Regarding those with massive amounts of invested capital… what happens when they lose money in the market? Is there a capital loss where they can recoup that money?”

    No your thinking like middle class here, where your money is paid to you as income. Rich people don’t use salaried income, and whatever they do have is chump change to their real financial investments.

    The seed money is usually old money, or for some of the new rich money earned from stock options / company IPO’s.

    The tax we’re talking about is not for the principle, the seed of the investment, its for the growth of the investment. If I have a $200,000,000 investment (this is small btw) and my hedge fund manager gets me a 10% growth (after their cut) then my fund is now worth $220,000,000. That is a $20,000,000 gain for that year, but is non-taxable as long as it stays inside the fund. If I were to sell off the stocks / bonds / commodities or whatever then I would have to pay the 15% capital gains tax at the end of the tax year. That is unless I can find a way to deduct it away, typically in the form of business expenses. Then I’d only have to pay for the portion I can not deduct away.

    You do this anyway, when you sit down and do your taxes at the end of the year you have a deductions column. Yourself + dependents, then various federal / state deductions for mortgage, education and what not. Works the same for business’s, and every financial investor is considered “self employed” for the taxes on their investments. They can claim their apartment rental as a business expense, they claim their cars and living expenses as a business expense. It totals into the millions of USD and is used to get their net taxable income to near 0$.

    They made $20,000,000 that year, but on paper they made $500,000. And the IRS only see’s what’s on paper.

  • JoeC
    7:48 pm on September 21st, 2011 5

    #3

    Nope. A capital loss grants you and additional deduction but that is not a direct recoup of that money.

    But that is to be expected. Investing is like gambling. You are taking risks of loss.

  • someotherguy
    7:48 pm on September 21st, 2011 6

    And when I say “rich” I’m not talking about run of the mill lawyers, doctors, or the like. Not even actors / sports stars or entertainers. I’m talking financial managers, brokers, and investors. I’m talking people making $20~50,000,000 USD per year on the low end and $1~5,000,000,000 USD on the high end (yes that’s another set of zeros). These people make such ridiculous amounts of money but pay nearly nothing in taxes. Their reaping the rewards of a stable government, yet paying nearly nothing to support that government.

    The middle class of the USA is taxed out, the lower class, well you can’t really tax people who don’t have much to begin with. The only set of people not paying is the big money rollers, the ones who have the financial resources to keep their *reportable* earnings at a low amount.

  • someotherguy
    7:50 pm on September 21st, 2011 7

    @5,

    Its crazy how they can claim the value of a loan against the value of what they take out and write it all off as business expenses.

  • wamille
    7:59 pm on September 21st, 2011 8

    Damn… too bad I wasn’t born rich. More power to people who are born of old money. Would I want the government to take my money because I was born into it? No. Why should I begrudge someone who was lucky enough to be born into it. Be happy you live in a free country… U.S. or South Korea. We hit the lotto not being born in North Korea, Cuba, Venezuela, etc. I think I’m right by saying America has the most obese poor people in the world. That proves we are a rich country… our poor are fat!!! And most “poor” Americans have big screen tv’s, cars, microwaves… indoor plumbing, electricity, telephones.

  • Teadrinker
    8:00 pm on September 21st, 2011 9

    #6,

    Excellent points.

  • 코리아
    8:03 pm on September 21st, 2011 10

    It’s very complicated and intricate, but in a short answer, assumed capital losses can usually be deducted from income taxes (assumed meaning cash out from all investment properties resulted in a loss from investment amount). It’s a fairly common practice for those near the top tier income bracket line (well-off but not super rich) to assume their losses as a way of reducing net income to stay in lower tax brackets.
    As for the system mentioned by someotherguy, if their intention was to shield long term gains from taxation, then the fund if question would be considerably risk adverse and “safe”. The initial money was probably taxed as income, however there are other ways to reduce or eliminate that as well.
    How to tax citizens really is the biggest question faced by any government. Personally, I do generally support a tiered, flat tax brackets (the original intention of our system), greatly reducing deduction and code loopholes and a greater emphasis on operational taxes (sales, vice, etc.) I know these systems aren’t perfect either and frankly the rich will always have the advantage.

  • someotherguy
    8:18 pm on September 21st, 2011 11

    @10,
    “How to tax citizens really is the biggest question faced by any government. Personally, I do generally support a tiered, flat tax brackets (the original intention of our system), greatly reducing deduction and code loopholes and a greater emphasis on operational taxes (sales, vice, etc.) I know these systems aren’t perfect either and frankly the rich will always have the advantage.”

    I could get with this. I don’t begrudge people from making money, I get angry when their actively working to avoid paying their share which is resulting in a higher burden for everyone else. They reap the largest gains and thus should pay the largest amount. And what their doing isn’t so much as shielding long term gains as to reduce expenses. Tax’s are seen as an expense, it’s financially cheaper to use the load / deduction route then to pay the 15% capitol gains tax directly. You don’t take out $20,000,000 in capital gains, pay tax, then reinvest it again, like people think you would. You keep it inside the fund, and if you need to move your position you just do a swap (swap your stocks / bonds with someone else’s at the market value). A little more cumbersome then sell / buy, but shields you from tax liability as no cash is ever created.

    @8,
    I realize your trolling at this point in time and just trying to stir up stuff.

    “Why should I begrudge someone who was lucky enough to be born into it”

    At no point in time did I begrudge someone who’s parents have money. There is an inheritance tax, that itself is often avoidable by keeping the family wealth in funds and transferring their value to next of kin before death. Reduce the “estate” of the dying elders to as much as possible prior to their death so that the tax paid on that estate is as small as possible.

    But this isn’t about inheritance tax, this is about people with very large amounts of money finding various ways to dodge / write-off their tax debt. We are a country and have a government. That government spends money and provides for the common security of the country. Now while we may argue over how much the government should spend, we did elect the people doing the spending. There is a cost for this security and it is the duty of every citizen / resident to shoulder their portion of this cost. When the majority of your country’s wealth holders are allowed to avoid their burden, then it creates strife and economic issues. The middle class can not support the burden of the nation on their own. It’s that simple.

  • Avatar of GI KoreaGI Korea
    7:37 am on September 22nd, 2011 12

    Someotherguy, the President’s rhetoric as well as his economic plan are not focused on the mega-wealthy. As his economic plan shows he is considering wealthy being those making over $1 million a year. The AP fact check article shows that those making over $1 million year are paying 24.4% in income tax while those making $100,000 to $125,000 paid on average 9.9 percent in federal income taxes. Those making $50,000 to $60,000 paid an average of 6.3 percent. Here is more from the article:

    The 10 percent of households with the highest incomes pay more than half of all federal taxes. They pay more than 70 percent of federal income taxes, according to the Congressional Budget Office.

    So the rich as defined by the President are paying more then their fair share in income and federal taxes.

    If he focused his attacks on the mega-wealthy that are not paying income taxes then I wouldn’t have a problem with the criticism. That is why I am offering alternative tax ideas to get these people to pay more in taxes instead of paying lawyers and accountants. My idea of increasing capital gains taxes on those not paying income tax is one idea. Putting a minimum on the percentage of your tax bill that can be deducted is another one.

    Also I still believe that everyone should pay something in income taxes so you don’t end up with 46% of the people paying nothing in income taxes.

  • Jeff
    8:39 am on September 22nd, 2011 13

    http://www.fairtax.org.

    Simple, effective and low calorie.

  • setnaffa
    9:21 am on September 22nd, 2011 14

    Flat tax. Same rate for everyone. Deductions for things like charitable giving, mortgages, and other things the government wants to encourage.

    Stop “punishing success” and paying people to sit on their fat, well, you know…

    This is easy but the fact is most politicians don’t have the stones to do it…

    Because then, EVERYONE has skin in the game and won’t be voting for bigger government…

  • kushibo
    11:15 am on September 22nd, 2011 15

    God forbid we start thinking that the groundwork for the success of the successful comes from the infrastructure (structural, educational, medical, etc.), stability, good government relations with other countries that provide relatively smooth trade, projected power, etc., that are paid for by governing bodies with our taxes and that those who are the most successful are benefiting the most and thus perhaps to pay the most. I’d hardly call asking them to pay for what is helping them in the first place is “punching success.”

  • kushibo
    11:17 am on September 22nd, 2011 16

    I’d also add that while I am sympathetic to the idea that the rich “create jobs,” lately one has to wonder just where they’re creating them. The uber rich are taking advantage of their own personal economies of scale and taking their dollars to China to do build the stuff once built by Americans. We need to bring back the middle-class and lower-upper-class entrepreneur.

  • ChickenHead
    11:39 am on September 22nd, 2011 17

    Setnaffa,

    Flat taxes are a problem because the economy is unavoidably structured around a certain minimum cost of living… with many expenses being mandatory constants rather than rising in correlation with income.

    If the tax rate is 10%, $50 is a real burden to a guy who makes $500/week… and must spend what is left just for essentials like rent on a crappy place, low-end food, minimal utilities, and gas to get to work in an economy car…

    …but a $500 weekly tax bill isn’t noticed by a guy earning $5000/week… who can buy a nice house, eat out every night, leave the lights on, and fill up his tank with $4/gallon gas for an hour of work… and still save more each month than the guy just getting by.

    This is the reason for a progressive tax. It does not attempt to bill everyone equally. It attempts to burden everyone equally.

    This gives some relief to the large population of guys just getting by with the sacrifice of the much fewer guys who are living well but will now have to buy a Porsche instead of a Ferrari.

    So a progressive tax, rather than a flat tax, is really better for a correct society.

    The shape, slope, and offset, of the progressive tax curve is the real question here… with the shape and offset being pretty easily and fairly calculated based on the cost of essential goods and services… though the slope of the curve might be rather hard to determine… as there are many factors that influence themselves before reaching equilibrium.

    Politics, of course, warp all of these calculations.

    If fairness, especially to upper-income earners, is the goal… and it should be… it would be much more productive to force the non-taxpaying half of the American population to quit being dependent, get a job, and start paying some taxes… but that is a generational project… and the last couple generations of politicians have been breeding for dependence rather than productivity.

  • Frank Kim
    1:55 pm on September 22nd, 2011 18

    The upper-middle class have many tax deductions that allow us to pay much lower rate than the middle class. And this becomes more exaggerated as you go to higher levels of income because you no longer have to pay Social Security tax on that income and you have much more income from capital gains and dividends.

    This article clearly illustrates this thanks to the Tax Policy Center.

    http://krugman.blogs.nytimes.com/2011/09/21/millionaires-the-middle-class-and-taxes-actual-numbers/

  • Floridaegu
    3:05 pm on September 22nd, 2011 19

    Flat tax. No loopholes and everybody pays.

    Courtesy of the Cato Institute…

    http://www.youtube.com/watch?v=nhUOpNve1bY&feature=player_embedded

  • Sonagi
    4:35 pm on September 22nd, 2011 20

    Thank you, Joe C, Someotherguy, and Chickenhead for your informative contributions. CH, I must correct one misstatement:

    “it would be much more productive to force the non-taxpaying half of the American population to quit being dependent, get a job, and start paying some taxes… “

    As noted, the “non-taxpaying half” is actually the “non-federal income taxpaying half, and a fair number of household heads actually do work and manage to get full income tax refunds due mostly to deductions for dependents and child care tax credits, which as I understand it, can actually result in a net payment by the federal government if the credit amount exceeds taxes paid. Household heads filing with ITINs instead of SSNs, most of whom are in the country unlawfully, can even get child care tax credits. And all this time, you thought illegal immigrants were filing tax returns out of the goodness of their hearts. Nevertheless, the total amount of refunds to child care tax credit users is a drop in the bucket compared to the total taxes dodged by the richest, as explained by Someotherguy in #4.

  • John in CA
    5:08 pm on September 22nd, 2011 21

    someotherguy, THANK a LOT for the thorough writeup.
    I always find it so hilarious when the wannabe rich folks get swept up by the rhetorics from the uber-rich for policies that will hurt them (wannabe rich) and the nation in the end.

    #12
    “you don’t end up with 46% of the people paying nothing in income taxes.”

    I’m pretty sure the lower 46% would LOVE to be able to pay income taxes. But thanks to the policy pushed by the uber-rich, they can’t get decent jobs to pay the income tax.

  • Expat
    9:16 pm on September 22nd, 2011 22

    Bill Clinton just summed up the current bruhaha over tax class warfare pretty well. The well respected former President came out against any current tax increases and against class warfare over taxes. Looks like Obama is out there all alone, with his radical friends that is, on this one.

  • buddha
    10:53 pm on September 22nd, 2011 23

    most of the tax cheats are the same ones screaming people arent paying their fair share.
    charlie rangle
    john kerry
    oprah, bruce springstein to name a couple!
    celebrities who own mass acres and amounts of properties then use the loop hole of claiming its farmland to get around both state, federal, and local taxes and receive subsidies and tax breaks

    scum!

  • buddha
    10:59 pm on September 22nd, 2011 24

    and whoever john in ca is please spare us the violin music swan song BS
    you sound like the idiot above claiming welfare and food stamps are economic stimulators. same crap spewed by this administration

    nov 2012 cant get here fast enough!

  • a listener
    3:29 pm on September 23rd, 2011 25

    Nov 2000 can’t cant get here fast enough!
    Nov 2004 can’t cant get here fast enough!

    There I sound as stupid as you now.

  • a listener
    3:34 pm on September 23rd, 2011 26

    #23, Please do not post without proof of the fact that there are tax cheats on both sides of the political radar, you choose to only highlight some from one side regardless if all those people are actually more guilty than their political counterpartss.

  • Leimeng
    10:39 pm on September 23rd, 2011 27

    ~ People and liberals are missing the point. The money belongs to those who earn it.
    ~ As part of the ‘social contract’ every individual should pay the same percent on their income. Everyone one makes $100 should pay the same tax rate. Maybe 5% or 15%??? The bigotry of the regressive neanderthals says that one person who makes $100 should pay more than another person who makes $100. This is immoral and pure greed. It makes no difference if one individual earns that amount in one hour or ten hours.

  • someotherguy
    5:07 pm on September 25th, 2011 28

    What I find most interesting is that the ones who stand to gain the most from closing tax loopholes, the middle and upper middle class, are the ones crying the hardest against closing those holes.

    When I say “rich” I’m not referring to 200K, 250K, 500K or even 1mil a year earners. While that is a good deal of money, its no where near enough to dodge the tax bullet. The most they could possible do is put the majority of their money into an IRA in their kids name, otherwise all the money their investing / saving will be come from net-tax dollars. Thus their paying their dues.

    Then you have the 10mil+ earners who’s “salary” is only 250K/year on paper and the rest is stock options and other financial non-cash compensations. Their paying tax on the 250K/hr but dodging the tax’s on the other $9,750,000 their making. This directly results in the previous 200~500K a year being forced to pay higher taxes to compensate for the previous 10mil earner dodging theirs.

    You would rather tax the people making nearly nothing, or too unproductive / lazy to make anything. You can’t squeeze money from poor people, just like you can’t squeeze water from a stone.

    And GI,you might want to gcut the strawman. I never mentioned Obama or class warfare or anything else you posted. I merely listed EXACTLY how you can earn millions to billions of USD and not pay taxes on it. What I listed isn’t the only way, but it’s the most blatant. It’s all legel, and it was made legal by the same people doing it or being financed by the people wanting to do it.

    And while I abhor the stupidity that is the liberal mentality, I’m completely baffled on why what is supposed to be the smart people, the conservatives, are so easy to confuse and blind. You’d go around blaming the evil “liberals” for taking all your money, when really its your own groups supporters who are the ones doing this.

  • Glans
    9:56 pm on September 25th, 2011 29

    Why should military pay be taxed at a lower rate than the capital gains of millionaires and billionaires?

  • someotherguy
    10:17 pm on September 25th, 2011 30

    @29,

    I’m against military pay being taxed period.

    Their not regular citizens and are contributing their share by volunteering to server.

  • Glans
    11:34 pm on September 25th, 2011 31

    @ 30, Should teachers, firefighters, police officers, nurses, be taxed at a higher rate than the capital gains of billionaires?

  • someotherguy
    7:11 pm on September 26th, 2011 32

    @31,

    Nope, and it’s why I support removing many of the loop holes currently present. Most of what Obama actually proposes is closing loop holes not raising taxes. The GOP, and some Dems don’t want this, it hurts their support base. Thus the way to defeat any proposed tax change is to twist it and represent it as “raising taxes”.

    Funny part is, right now we have three options facing this country, reduce spending on military / social programs, increase tax revenue, some combination of the previous two. No matter how you twist it, reducing spending on military / cutting social programs will hit the middle class / upper middle class much harder then it’ll hit the investment bankers. Increasing revenue via taxing will also hurt the middle / upper middle as their the ones actually paying taxes, the investment bankers don’t pay tax. Increasing revenue via closing loopholes won’t effect the middle class / upper middle class, they don’t have enough money to qualify for those holes. What closing loopholes does do is hurt the investment bankers, and they find this unacceptable and will leverage their rather large power-base to press politicians to oppose any such changes.

    So … the largest voter block of the GoP is the middle class / upper middle class, and the GoP has convinced them to vote for something that’s against their best interest. I’m still scratching my head on this.

    And no, firefighters / police / nurses / teachers do not face nearly the same thing as a service member. Their civilians who work for the government. Soldiers (and others) are military, military is not a job, don’t think of it as a job.

  • Glans
    9:40 pm on September 26th, 2011 33

    @31 we have another choice. Rebuild and improve our infrastructure. Interest rates are low now. This is the time to borrow money and put the unemployed to work.

  • someotherguy
    10:38 pm on September 26th, 2011 34

    @33,

    Except our nation has borrowed too much in the past. Borrowing unnecessarily is a bad idea. That being said, we will have no choice but to borrow for the next 2~6 years to get out of the mess we’re in. Economic cycles do not run on nice political timelines, things we do today will not take effect for three to four years. Things we did last year will happen next year so forth. We’re stuck with the situation were we got used to spending income we didn’t have while giving tax breaks to investment bankers and hedge-fund managers. This worked fine when our economy was healthy, but once it soured (as all economy’s will eventually) those spending habits caught up with us.

    What we should of been doing is spending additional income by buying back our debt and lowing our debt load, not giving refunds and tax breaks. We have to pay interest every year on the bonds we sold, failure to do this is what Greece is facing now and is a VERY VERY bad thing. Pay down the principle and our yearly interest payment goes down, this is a big plus for the long run. Yet politicians have duped all y’all into thinking short term only.

    Any who, you can’t cut your way, nor can you spend your own out of the current economic situation. It’s the natural correction for all the past spending, it’s coming and there is nothing nobody can do. Postponing it will only make it worse. This is the fault of both the left and the right, so body escapes this looking good. Only way to get clear is to close those damn loopholes, aka “Bush Era cuts”, and cut down unnecessary spending, including social programs. It sucks but we already spent this money, now we gotta pay for it.

  • Glans
    2:49 am on September 27th, 2011 35

    @ 34, We spent our way out of the Great Depression, with huge federal programs from 1941 to 1945. And the highest marginal tax rate was:
    1940 79%
    1942 88%
    1944 94%
    Only in 1964 did it drop to 77%.
    That’s right, the greatest boom in our history was a time of high taxes on the rich.

  • Retired GI
    3:35 am on September 27th, 2011 36

    Question Glans: Was it high taxes on the rich OR was it high taxes on all? I only ask because you lefty types are always condeming the rich. Like they stold something from you. I’m not rich, but I don’t hate the rice like the left seems too. They do the hiring, they own the businesses, and Construction firms that you want to employ to build the infrastructor.
    So you want to employ them and tax them at what 88%, 94%? Not a good motivating factor for hiring Glans. Add Obama care for the workers and I don’t see any bids for the jobs.

  • Glans
    3:51 am on September 27th, 2011 37

    Retired GI 36, you want to see historical income tax rates, visit the repository of all knowledge. Lower taxes on the rich ==> lower economic performance. Paradoxical but true.

    In some countries, the Party does the hiring, it owns the businesses and construction firms. If you had been born in such a country, you might not join the Party, but you’d love the Party. You’d thank it for your job, your home, your security; you’d hate its enemies. And you’d think all these attitudes were your own, freely chosen by your own independent thinking.

  • setnaffa
    7:01 am on September 27th, 2011 38

    Glans has “misunderestimated” History. It was WW2, not the New Deal that lifted America out of the Depression…

    Hoover “guessed wrong” after the Stock Market crash to create the Depression; and FDR’s spending prolonged the misery. Read about his plans to stack SCOTUS, too…

    You’d think we as a nation would be able to learn basic economics; but the “Progressives” are so arrogant (Psalm 14:1, Romans 1:22) and think they are the only smart folks in the room…

  • Retired GI
    2:07 pm on September 27th, 2011 39

    #38 Setnaffa, Now THAT, is the story that I have heard. I wanted to hear what Glans would say. He said what I thought he would. I am surprised to hear someone come out with this side.
    Thanks to “Fox” I have heard before, what you stated so well Setnaffa. But no where else.

    I will have to look it up and find sources. There are far too many like Glans who believe that the socialistt way is the only way, even with evidence of the contrary in North Korea.

    If the Federals can give it to you, they can take it away as well. Thus my hate for the UN and their desire to end the 2nd amendment in America. When it goes, the others will follow. Obama and Clinton are doing their best to make it happen also. Need to vote that Socialistt out of the White House.

  • Glans
    2:58 pm on September 27th, 2011 40

    setnaffa 38, I said, “We spent our way out of the Great Depression, with huge federal programs from 1941 to 1945.” I knew I could count on you to identify the federal programs of those years. You agree with me, that deficit spending by an enlarged federal government ended the Great Depression. This time, we can do it with programs that rebuild our infrastructure without destroying other countries’ infrastructure.

  • setnaffa
    7:20 pm on September 27th, 2011 41

    Glans, your type of humorless mirth resulted in the deaths of about 6 million Jews and 4 million other “undesirables” in the Nazi death camps.

    The reason America left the Depression was 14% of our men were in uniform and all of our factories were producing goods. The post-war boom was directly a result of our government selling our manufacturing expertise and output to other countries because of the rest of the industrialized world having been reduced to rubble.

    You lie as easily as your father on the other side. If you can’t figure out why socialism ALWAYS produces shortages, famines, and death camps, at least have the courtesy to shut up while your betters are in the same room.

    Or better yet, go spend a month in Zimbabwe or North Korea. Lots of deficit spending there.

  • Glans
    4:01 am on September 29th, 2011 42

    setnaffa 41, you have insulted my father. You are garbage.

 

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