I'm Sick Of Hearing About The Poor, Poor Millionaires
Conservatives and corporate-owned Democrats are in a tizzy. The House is moving its version of healthcare reform forward, and it (gasp!) raises money by (double-gasp!) taxing rich folks. Not by very much, as these things go -- but you certainly wouldn't know that from hearing Republican politicians and their enablers in the news media. As far as they're concerned, Democrats are going to raise everyone's tax rates (yes, even YOURS!) until they rival Denmark's (complete with Fox News graphics, in case you missed the point). While the tactic is new, the strategy is an old one, and can be summed up as: "Who will stand up for the poor, poor millionaires and billionaires?"
You know what? I'm sick of this nonsense. I really am. Starting, first and foremost, with the term "class warfare." I keep waiting for some Democrat (Jim Webb would be a good choice, in my opinion) to stand up and say something like the following -- to either some clueless, overpaid, inside-the-Beltway media type, or some clueless, bought-and-paid-for Republican officeholder:
"I'm sorry, did you just say 'class warfare'? Your use of this term is highly offensive to me. In case you have forgotten, we are at war. We are currently waging war in Iraq and Afghanistan. The vice president's son is currently serving in a war zone, as are thousands of other brave American men and women who wear the uniform of the United States of America. And you have the gall to sit there and call a discussion of marginal tax rates 'warfare'? Please show me the video highlights of this war, if you would. Where are the clips of armed guerrillas laying siege to the Hamptons? Where are the battlelines where people are dying in the hills of Bel Air? Where are the armed insurrectionists? How many casualties has this class warfare cost? Where are the pitchforks and torches and mobs in the streets? If you don't have video of such battles raging right now to show me, then I would insist you not refer to a debate in Congress over making the ultra-wealthy pay the same tax rate they did under Bill Clinton -- a tax rate much less than they paid under Ronald Reagan, I might add -- as any type of 'warfare,' because it insults me and it insults the men and women who are putting their lives on the line on foreign soil right this very minute to preserve your ability to say such repugnant things."
As I said, Senator Jim Webb would be my first choice for delivering this message, for obvious reasons. Sometimes, as Robert A. Heinlein said, you have to step on people's toes until they apologize.
A few facts are in order here. What is causing apoplexy in Republicans is a plan to raise the income tax rate for people making over $280,000 a year by one to five percentage points. Right now, the wealthiest of the wealthy in America pay 35 percent income tax. What is being proposed is raising this back to where it was before Bush lowered it -- to a high point of 39.6 percent. Not, as Republicans will tell you "almost as high as Denmark's." Denmark's highest income tax rate is 60 percent. Plus (a fact they conveniently ignore), in Denmark you pay a "Value Added Tax" (or national sales tax) of 25 percent on everything you buy. So don't worry, nobody in America is going to be paying anything like what the Danish pay.
Nancy Pelosi has even already walked these numbers back. She's now proposing taxing only single people who make more than $500,000 and couples who make more than one million dollars every year. In other words, Joe The Plumber should relax, because his taxes aren't going up a dime. He would be part of the ninety-nine-percent-plus of the American workforce who would not have their taxes changed one tiny little bit under this plan.
This stuff seems obvious to me, but then I turn on the television, and listen to "journalists" who have apparently beamed in from Mars. Or Pluto, since they seem to be speaking Plutocrat as their first language. Ahem. Seriously, when is some Democrat (Al Franken springs to mind for this one) going to ask one of these blow-dried talking heads "Excuse me, but in the interests of full disclosure, you really should tell the viewers how much money you make per year. You seem to be championing low taxes for the ultra-wealthy, but I detect more than a hint of protecting your own self-interest in this discussion." I'd pay good money, so to speak, to hear someone (anyone!) say that to one of these "journalists" on television. It would put things in some sorely needed perspective. "Did you make more than a million bucks last year? How many millions did you make? Why didn't you share that with your viewers at the beginning of your comments?"
But perhaps that's a tad too confrontative, eh? OK, how about laying it on the line in a calm and rational manner, then. Democrats have been terrified -- absolutely terrified -- to raise any taxes at any time, because the Republicans have used it so effectively as an iron club, for so many years now. But healthcare reform has to be paid for somehow. Now that the House has thrown down the gauntlet, we need to hear a few Democrats defending this action, instead of eternally shying away from it. Democrats, so far, have seemed to think that if they don't talk about it, nobody will notice that they're raising taxes on the rich. This is wrong -- Republicans have been waiting to pounce on this particular issue ever since Nancy Pelosi was sworn in as Speaker of the House, and they are now gleefully doing so. The only way this is going advance politically is if a few Democrats defend the policy to the public, and calm everyone down a bit. Here's an example of what I'm suggesting:
"President Obama promised during his campaign not to raise taxes on people making less than a quarter of a million dollars per year. We are going to help him keep that promise. Others have been suggesting that we tax everyone's health care benefits to pay for health care reform. We're not going to do that, because it would affect union members and other hardworking Americans -- lots of policemen and firemen, and others who make up the backbone of the middle class in America. We think they've been taxed enough. We think that the millionaires and billionaires who have made out like bandits under Republican tax cuts for the past eight years can afford to go back to paying what they paid under Bill Clinton. We want to repeal the Bush tax cuts on the extremely wealthy, because we think it is more important to provide access to healthcare to all Americans than it is to help people like John McCain buy another house or airplane. Everyone is having to sacrifice in this economy. Millions have already sacrificed by losing their jobs. Millions have lost their health care. Millions of sick people are sacrificing their health, because they cannot pay for treatment. Millions more have had to take pay cuts, and are relieved just to still have a job. The American people have sacrificed, and continue to make tough decisions daily -- because some can't afford both medicine and food. And we simply do not think that asking millionaires to pay an extra few percent of their million-dollar incomes is asking too great a sacrifice from them. We think it's about time they sacrificed a little bit, for the good of the country, and gave back the Bush tax cuts."
Until and unless Democrats start saying things like this, this tax increase is simply not going to happen. Democrats have to get over their knee-jerk reaction to being labeled "tax and spenders" by their opposition. Democrats have to stop scurrying away from the issue like cockroaches when the light hits them, and get out there and defend it. If higher taxes for millionaires are the way to pay for healthcare reform, then let everyone know it, and know why.
The poor, poor millionaires already have plenty of people beating their chests and rending their garments in public. Republicans and mainstream media "journalists" are already doing a dandy job of this. Democrats have to stand up and say, in response, "I'm for the little guy. I don't want to tax the average worker any more than they already are taxed, so I do not support taxing the middle class' healthcare benefits. Instead, I think the ultra-wealthy can pay a few percent more each year to fix the healthcare system in America. I don't think that's too much to ask of them, and I will fight any attempt to move this tax burden away from the wealthy down to the little guys. That may have worked in the past, but it's not going to work this time!"
Cross-posted at The Huffington Post
-- Chris Weigant
Chris, you'll excuse me for lacking any sympathy with Americans subject to a health care surcharge as part of a public option:
In other words, if you make a half million or more your taxes will go up about $4.11 a day to give Americans health insurance.
That's a Starbucks venti latté. Per day. How many times have you heard Dave Ramsey tell everyone to give up their daily coffee habit and bootstrap themselves out of poverty?
Sauce for the goose, I say. The rich aren't entitled to an extra latté.
Breaking news, Chris:
Special note to philistine, who commented over at the Huffington Post:
Really? Winston Churchill said this and Heinlein ripped it off (you're right, it was Lazarus Long who said it, although he used the line in other places as well, I think)? You're probably right.
As Mark Twain said, "Immature humorists borrow, mature humorists steal."
Heh heh.
-CW
Osborne Ink -
I remember, a few decades ago, when Bill Gates was making the astronomical sum (for then) of $40 million a year. We calculated out the financial impact of a cup of coffee. It went something like this: If you see a beggar on the sidewalk, and took him and bought him a cup of coffee, it would be (to you) inconsequential financially -- a few coins from your pocket. The same fiscal impact you or I would have from buying that cup of coffee, if you were Bill Gates, would be the equivalent of buying the beggar a new Porsche. You or I could buy a down-and-out guy a cup of coffee every single day, and would barely notice the fiscal drain. Gates could buy a new Porsche every day, and it would have the same impact to his finances.
Mind-blowing.
-CW
Strange as it may seem to ya'all, I am in complete agreement.
Not over the HealthCare boondoggle, because it's pretty much already DOA.
But, like you CW, I do find it hard to garner up any sympathy for the millionaires. They should be taxed like we vote here in Florida. Early and Often... :D
No sympathy from me for them. As mentioned in a previous posting....
"My give-a-damn's busted."
Michale.....
Are you listening to yourselves? Ok, Someone please tell me when the last time you heard about a friend or someone you knew getting a job from a poor person. Anyone? No? There's a reason...People who produce and create value earn their wealth. Those who make poor decisions and worse, fail to take responsibility for those poor decision and instead throw themselves upon the mercy of others create nothing. Since when is the government, creator of such success stories as the public school system, medicare, social security and...wait for it...the VA suddenly the pinnacle of efficiency? The government is no more the answer under this president than it was under any of the 43 before him. Of course, over time, our general laziness coupled with the increasing sense of entitlement to all things material have grown into a mass appeal for a nanny-state; one which will care for us from the cradle to the grave. And who will pay for this? Why the Rich of course. They have oodles of money, much more than they ever could use. Why not the Rich? They won't even miss it.
Who's the moron that said that the cost of a late per day was all that was required? Really? Is that all. Ok, for starters, let's get granular for a second and say the Shareholders of Starbucks, which includes a majority of the few pension funds that remain in existence - they might get a little ticked off. Of course, the loss of those cups of coffee are nothing when compared with the increased tax the company will pay in order to cover the budget shortfalls that occur after the second wave of enrollment hits the government program. When will that happen? Why as soon as employers realize that they can't afford the cost of private insurance and it's easier to dump everyone into the government system. Pan back and look at the big picture for a second.
The only reason we even have a country is because business owners and entrepreneurs decided that they could do better than the whatever option existed at the time, and when no option existed, they created one. Innovation will continue and thrive provided government intervention is kept to a minimum. But if the kind intentions behind all of these government entitlements are eventually going to result in the suffocation of our nation under a weight of tax liabilities and overdraft notices from our foreign creditors.
The wealthy are wealthy because they produce more than they consume and they create value that others desire and are willing to pay for. So why is explaining this simple concept to liberals like explaining heaven to bears? If every millionaire suddenly disappeared along with whatever company they created or invested in, this nation would turn upon itself and die in a month.
Get over yourself and stop whining. The sooner the majority of the poor start to realize that their only safety net is the one that they create for themselves through hard work and determination, the better off everyone will be. No tell me about the blind mother of 6 who has 4 handicapped children or some other nonsensical example to make a point. There will always be exceptions, but no exception is sufficient to bankrupt the nation in the name of the common good.
We are created equal, but after that, you're on your own.
CW had commented that there should be some more heart-wrenching stories about Healthcare issues.
There is the tale of Gary Reinbach. A 22 year old admitted to the hospital with liver problems brought on by alcoholism. Reinbach died because he couldn't have a liver transplant. This should be a poster-case for the Democrats. Those that support ObamaCare should be screaming from the rooftops about Reinbach and how despicable it was that Reinbach wasn't allowed a liver transplant. Democrats should rally around Reinbach because he is the victim of the dreaded disease that is alcoholism..
Oh... Wait...
Gary Reinbach lived in the UK and was part of the "vaunted" and "admirable" European style healthcare programs that the supporters of ObamaCare have touted as being a model system, the systems to emulate.
This "vaunted" and "admirable" Healthcare program denied Reinbach a liver transplant because his condition was brought on by heavy drinking since the age of 13. Despite never having been hospitalized previously, Reinbach was denied the lifesaving transplant.
Now, I don't know about ya'all, but I find it a tad disconcerting to have some "morality" committee sitting in judgment and deciding who lives and who dies. (Unless, of course, the WHO that is dying are terrorists, but that's another debate...)
Is this the kind of healthcare program that we in the USA should try and emulate?? Seriously??
Michale.....
@StopWhiningAlready
I agree with much of what you say. You sound like me, after I have had one tee meeny martoonies.. :D
We are created equal, but after that, you're on your own.
I especially like that line. It's so dead on ballz accurate (an industry term) it's scary..
Who's the moron that said that the cost of a late per day was all that was required?
But as for this, that "moron" I believe was CW, the host of our little slice of heaven.. I would think a modicum of respect would be in order, solely on that basis alone..
Other than that, I really can't find much fault with anything you say..
As John McClane said ever so grasciously....
"Welcome to the party, Pal!!!!"
:D
Michale.....
Just finished reading the comments over at HuffPost (and approving a new commenter's first post here, sorry for the delay StopWhiningAlready).
But before I get to serious responses, I just have to say that this web site and your humble narrator value all Canadian women, whether elles sont Québécoises, they are Newfies, or they are from one of the other fine provinces of our Northern neighbor. So there!
:-)
-CW
Hey, I never even used the word latte! Come on, guys, it's only a few comments up the page...
"What a maroon!" (Bugs Bunny, if I'm not mistaken...)
Heh heh.
But seriously, StopWhiningAlready (do you mind if I call you SWA? It's just a mouthful to type, that's all), while Horatio Alger stories are great, do you really believe everyone in America starts out equal?
This is one thing which annoys me -- the equation of "if you're poor, it's your fault." [Full disclosure, I'm not poor, not rich, doing OK.] Puh-LEEZE. If you're brilliant and hardworking, you don't always wind up on top. And the converse is also just as false -- if you're rich, you are not always brilliant and hardworking and adding a bunch of jobs to society as you pull up your bootstraps.
I have two words for this entire idea: Paris Hilton.
Most businesses start out not by wealthy people, I'll give you that, a lot become wealthy because of the businesses they create. But how do most of them create this business? With a bank loan. And do the banks discriminate as to who gets those loans? Or is everyone with a good idea treated equally by the banks?
The progressive tax system was created on two rationales: those with more can afford a bigger bite, because those with more (on average) consume more government services. Things like air traffic control (wealthy travel more). And the Coast Guard (wealthy have more pleasure boats to rescue).
Also, like the estate tax, the progressive income tax was created to avoid ever having an American aristocracy, where almost all the wealth was concentrated in a few hands and passed down from generation to generation (as in Europe in the past). Once again, Paris Hilton. This was done on purpose, because having an aristocracy is incompatible with the ideals of democracy. This actually works to ensure that everyone does have a more level playing field when born, and the Paris Hiltons of the world have to (boo hoo!) start out with only 10 billion in the bank, instead of 20 billion.
As for the argument against small business owners (mostly raging over at HuffPost, where I still can't post comments), give me a break. I've filled out Schedule C since I was 19 years old, so go peddle that foofaroo somewheres else, pal. When you become a business, the entire tax system starts working FOR you instead of AGAINST you. The only thing you pay taxes on is your PROFITS, not your gross income. You can write off everything under the sun, and not pay any taxes on it at all. The only thing a small business owner pays taxes on is the money they make as a profit (in other words, their own salary, in essence). So when you hear people talk about small businesses that "make over $250,000 a year" what they are really talking about are businesses which PAY THEIR OWNER more than $250,000 a year. They can do this making $300,000 in receipts, or $10,000,000 in receipts, because profit is a different thing than business income. ANY money reinvested in the business (like hiring a new employee) isn't counted in that $250K. So it's apples and oranges.
Also, the commenter let slip that he pays 35% income tax. Which means he makes (as profit, and AFTER personal deductions are subtracted) over $372,950 per year. Note that, due to the progressive nature of the system, he only pays the full 35% on every dollar made above $372,950, every dollar he makes below that is taxed at a lesser rate.
And don't even get me started on the disgrace that is "capital gains taxes" -- paid at a rate about half of what anyone who makes a salary pays. The wealthy mostly don't make money from doing things, but from moving money around by buying and selling stocks and the like. The profits they make off this activity is taxed at half the rate workers who do and make things have to pay. So how exactly is that fair? Isn't income treated equally? Aren't we all equal under the law? Well, everyone is equal except the extremely wealthy, who can make money just by buying and selling things -- who get taxed at half the rate everyone else pays.
The real question here is: were the 1950s a prosperous decade? Was there a massive expansion of the middle class and economic good times?
The top tax rate bracket back then was 91%.
What we are talking about today is changing the top bracket from 35% to 39.6%, for people (according to Pelosi) who individually make over half a million, or couples that make over a cool million every year. It's not as earth-shattering as people think. If you look at the consolodation of wealth since Reagan started this back in the 1980s, I would have to say "it's about time" personally. We are in our eighth year of the FIRST TIME IN AMERICAN HISTORY of being at war and LOWERING taxes at the same time. That is the problem -- in all other wars, taxes went up to pay the bill. During WWII, the top tax rate was 94%.
So, I would have to conclude, I hear the whining coming from an entirely different direction, StopWhiningAlready. Although I would agree, if the whining stopped, that would be nice.
-CW
PS. I was contacted by the lawyers from SouthWest Airlines before I finished typing, and they said I had to use your full name and not their trademarked abbreviation...
do you really believe everyone in America starts out equal?
Yes... Everyone starts out equal...
Greasy, grimey and covered in gunk..
As Robin Williams said of his newborn son,
A little old man dipped in 40-weight.
However, I see what you are trying to say.
Physical being aside, some are born with more opportunities than others. That is true...
But when it is all said and done, we all enter the world greasy and grimey and ugly and we leave the world as worm food...
You can tell I am a lot of fun at parties, eh? :D
Michale.....
Michale -
Ugh. There's a mental image I could have done without.
I forget who said it (another comedian, I'm sure), but I thought it was:
"All babies look like Winston Churchill."
Heh.
The last two lines of today's "Full Disclosure" (there's a new column up, in other words...) were just for you, Michale!
And I'd also like to give a big shout-out to Elizabeth/LizM here, for thankfully posting a comment over at HuffPost explaining why I'm not jumping in the fray over there (which is up to 120 comments). Thanks, Liz!
I've got new hardware on order, the problem should be fixed (hopefully) within a week. Until then, although I hate it, I cannot post comments at HuffPost. Sorry, again, for the interruption in service.
-CW
Yea, I saw and read that one first.. I think you'll like the comment I made.. :D
Michale.....
I'd like to address one point from HuffPost commenter JNarragansett.
Just in case anyone wonders what he's talking about, allow me to run it down briefly. American citizens are taxed no matter where they live in the world. Gasp! Theoretically, though. But, for paying these taxes, they get the privilege of voting, no matter where they are in the world. Other countries, in general, do not tax their citizens overseas. But, also, those expatriates cannot vote (otherwise the city of Boston would elect the Republic of Ireland's government).
But it's not as clear-cut as that. Up to an exclusion (was $70,000 when I was overseas, probably about $100K now), you are not taxed on your income at all. Let me say that again. Joe American lives in Otherstralia (hypothetically). He makes the equivalent of $90,000 there. American income taxes he pays -- zero. His wife, Jane American, makes $150,000. So she is taxed for the $50,000 above the limit. But wait! Say she's liable for $5,000 tax. But she still pays nothing to the US, because there is a tax agreement between Otherstralia and the US, and so she gets to subtract the $35,000 she pays in Otherstralian taxes before she owes the US a dime. This is somewhat of an oversimplification, but as you can see, you have to be raking in a pretty darn big paycheck before you would have to worry about Uncle Sam taking a bite. This is especially true since almost every other industrialized country on the planet has MUCH higher taxes (especially on the upper incomes) than we do. We pay pathetically small amounts of taxes in comparison to the rest of the world.
So, while he (technically) has a point about Uncle Sugar taking a bite out of expats' salaries, in reality (1) that's what you pay so you can still vote for president no matter where on Earth you happen to be for the election, and (2) the bite is non-existent until you are making a LOT of money overseas. Meaning it falls in the same category as what is addressed in the column.
Just to clear that up, for everyone.
-CW
First, I apologize about the moron and latte comment, firstly because I should have used more restraint and secondly for the poor spelling. I have several comments to your retort, however I cannot respond this second. Bar exam studies call. Alas...I will be back and unleash whatever clever rhetoric my mush-like brain can support at the time.
StopWhiningAlready -
Fair enough. I read every comment, although I don't promise to respond to every one. So even if it's a little late, don't worry, I'll see it.
As long as you get it in before the August congressional break, OK?
:-)
-CW
Didn't that August recess get canceled?
Barack Obama says that Congressional leadership is willing to keep Congress at work for a couple of weeks.
"The wealthy are wealthy because they produce more than they consume and they create value that others desire and are willing to pay for."
Baloney. Nobody in this country gets rich by producing. They get rich by owning production. It's the very definition of "investor class."
And why am I getting yelled at about Paris Hilton's latté? Let go of the Starbucks image for a second and you'll realize you're stuck on "rights."
Does Paris Hilton have more right to that $4.11 than a child with the flu? If your answer's yes, then I feel sorry for you.
Didn't that August recess get canceled?
It just occurred to me how apropos the term "recess" is, when referring to Congress...
:D
Michale.....
Which reminds me of another witty saying...
[I think this was Mark Twain, but it could have been Will Rogers, and I'm too lazy to look it up right now.]
"America has no permanent criminal class. Except Congress."
heh heh.
-CW
"America has no permanent criminal class. Except Congress."
And ANOTHER thing we agree on! :D
Michale.....
CW et all,
Using Paris Hilton as your straw man, despite the fact that both her frame and her IQ are so very closely resemble straw, is weak and geared toward garnering an emotional rather than a logical response. So, dismiss Hollywood from consideration (the majority of which are out there beating the drum for all things "Universal") and we can get back to reality for a second.
I'll grant you one point. You are correct that we aren't all born equal in so much as genetically every person has traits that are unique to them. Some are more brilliant than others, some are better athletes, etc, etc. However, all that amounts to is potential for greatness and little more. Where exactly is it written that anyone is guaranteed success? It is having the ability to succeed, accumulating the knowledge to put that ability to use and, over time, accumulating the common sense to understand the difference between aspiration, fascination and determination that results in the differences, economic and otherwise, later in life. (hang on..i'm just getting warmed up)
So, now let's go back to your example of Paris Hilton for a second. Regardless of what I think of her personally, somehow, she managed to generate an income of more than $20 million dollars last year exclusive of any inheritance she may have at her disposal. Is she running the Hilton Hotel Empire? Nope. She's selling B-movies (in some cases X-movies), clothing accessories, and putting her name on a host of products that moronic individuals choose to purchase at a premium solely for that reason. That's her skill-being well-known. As a result, her efforts employ a whole lot of people who earn a living as a result. Now of course, you're going to immediately point out that only starving children in third world countries work for her at pennies per hour (though I've yet to see them running behind her at parties, spare panties in hand just in case they are in need), but there are also others who own factories, manage media, and on up and down the chain that participate as well. That's commerce. Generating interest, right or wrong, is what keeps a lot of people employed in this country - including you CW. With that in mind, you and she are no different.
Now, let's stick with your straw-girl example. Maybe in our eyes, the world in which she lives is almost unfathomable, with so many millions at her disposal. However, she's a pauper compared to others. Sticking with the Hollywood ilk...maybe she feels poor in comparison to the likes of Angelina Jolie. After all, Mrs. Jolie/Pitt is an actress and apparently a pretty good one. She gets paid more than $20 million per film. Why not poor Paris? Shouldn't she make that much too? She can stand in front of a camera memorize stuff, right? People think she's pretty too, so what's the big deal? Maybe we should tax Angelina and use the money to give to the Paris Hilton's of the world because of Paris could afford the kind of lessons that Mrs. Jolie/Pitt had, maybe she could do so well. And besides, Mrs. Jolie-Pitt won't miss the money...She's rich.
To your next point...Bank Loans: Only wealthy non-minorities get them?
C'mon, competition is competition. Businesses are in business to make money. School lesson for the day: If a bank can lend money, it will charge as much as it can without losing that potential customer to the next guy who will charge less for taking the same level of risk that the customer will pay the money back. How do we measure risk? Credit scores are a good means of doing so, since they are applied to everyone universally (oh crap, there's that word again - "Universal" - maybe it isn't always good, particularly when it is applied against the liberal mind). You insinuate, though I know won't come right out and actually proclaim openly, that there is actually prejudice in the lending industry. Well, maybe we should just lend to everyone regardless of credit score. (No, you can't do that, the Government would have to force banks to do that, otherwise why would they take the risk?) Enter the Community Reinvestment Act and similar actions, among the most recent of which virtually forced banks to dedicate a percentage of their lending to people with substandard credit scores that would otherwise not be able to afford to purchase a home. (Well what about the down payment? Poor people can't afford to save that much money?) No problem, create new loan products requiring no down payment and lend up to 150% of the value of the residence. After all, if we refuse, they'd call us prejudice. Barny Frank and Reverand Al Frankin would hold rallies accusing us of keeping minorities from realizing the American Dream. After all...Everyone has the Right to own a Home.
(Buzzer sound.....) Sorry, you are incorrect. The answer we were looking for was "Common Sense, Commmon Sense").
No, everyone does not have the RIGHT to own a home. What have we learned from your second straw-man argument alluding to prejudice in the lending system? We've learned that when you give someone something that they have no right to in the first place, nor have they saved and placed a vested personal financial interest, which is mutually at risk with the Bank's money, and the Banks lend huge sums to people who haven't earned the right nor shown the requisite personal responsibility to handle such sums, that the borrowers, when faced with difficulty, will just as soon go back to the life they led before such a gift was thrust upon them and allow the home to go into foreclosure and disrepair rather than pay for it.
I now take a breath, and pause for a moment to reflect on the next wonderful topic: Your Love for the Progressive Tax System. For this, however, I'll defer to Ken Kamershen, PhD from the University of Georgia. Try as I might, I could never top his analogy and must therefore give all the credit to him for this fine example of why the Progressive Tax System Sucks. Ken...
Ken says...
Suppose that every day, ten men go out for beer and the bill for all ten
comes to $100. If they paid their bill the way we pay
our taxes, it would go something like this
The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.
So, that's what they decided to do. The ten men drank in the bar every day
and seemed quite happy with the arrangement, until one day, the owner threw
them a curve. 'Since you are all such good customers, he said, 'I'm going to
reduce the cost of your daily beer by $20. Drinks
for the ten now cost just $80.
The group still wanted to pay their bill the way we pay our taxes, so the
first four men were unaffected. They would still drink for free. But what
about the other six men - the paying customers? How could they divide the
$20 windfall so that everyone would get his 'fair share?'
They realized that $20 divided by six is $3.33. But if they subtracted that
from everybody's share, then the fifth man and the sixth man would each end
up being paid to drink his beer. So, the bar owner suggested that it would
be fair to reduce each man's bill by roughly the same amount, and he
proceeded to work out the amounts each should pay.
And so:
The fifth man, like the first four, now paid nothing (100% savings)
The sixth now paid $2 instead of $3 (33%savings).
The seventh now pay $5 instead of $7 (28%savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).
Each of the six was better off than before. And the first four continued to
drink for free. But once outside the restaurant the
men began to compare their savings.
'I only got a dollar out of the $20,'declared the sixth man.
He pointed to the tenth man,' but he got $10!'
'Yeah, that's right,' exclaimed the fifth man. 'I only saved a dollar, too.
It's unfair that he got ten times more than I!'
'That's true!!' shouted the seventh man. 'Why should he get $10 back when I
got only two? The wealthy get all the breaks!'
'Wait a minute,' yelled the first four men in unison. 'We didn't get
anything at all. The system exploits the poor!'
The nine men surrounded the tenth and beat him up.
The next night the tenth man didn't show up for drinks, so the nine sat
down and had beers without him. But when it came time
to pay the bill, they discovered something important. They didn't have
enough money between all of them for even half of the bill!
And that, boys and girls, journalists and college >> professors, is how our
tax system works. The people who pay the highest taxes
get the most benefit from a tax reduction.
@StopWhiningAlready
I heard "beer".. Then what?? :D
Seriously, that's a helluva analogy.. Kudos to you for finding it...
Michale.....
Thank you for that lovely analogy Ken.
As for you, CW, you claim to have been filing a schedule C since the age of 19. Hmmm...so you enjoy paying taxes on both corporate earnings as well as your own personal salary? As a corporate filer, you experience the wonders of double-taxation. Now, maybe you meant to say "1040-S", in which case you aggregate both business and personal income together, which makes it much easier to push the total income into the higher brackets. Regardless of how much of that income the owner actually retains for him/her self, the end result is the owner ends up paying more tax en total because there is more total income to tax, then carves out his portion from that now smaller pie. But hey, he's wealthy right? He won't miss it. All we're talking about is a latte.
What I find infuriating is the concept of the refundable tax credit, which is to paying taxes what toilet splash-back is to dropping the proverbial deuce. For the uninitiated, this is when someone who pays zero income taxes actually receives a tax refund. These credits are the weapon of choice in the Democratic arsenal for rallying the voters, particularly since now more than 50% of the American population doesn't even pay income taxes.
(Wait...you mean even if I don't pay taxes, I can get a refund as long as I keep reproducing and require state-run services?)
You betcha!
(But isn't that paying people to vote for the Democratic Party but for the wrong reasons?)
You betcha! It's more than that actually. It is wealth redistribution in it's purest and most unholy form. Only now it will be even more unholy, since along with that annual allowance for being such a good voter, people can demand Universal Health Care as a right as well.
I won't touch your Capital Gains claims, except to say that if we didn't make it easier for people to move in and out of stocks, investment in business which employ about half the nation would significantly decrease. Why penalize someone for taking risk and investing in someone else's idea? Why penalize seeking profit?
Finally, your claim that the 50's was the most productive time despite the 91% tax bracket is flawed...immeasurably flawed. For starters, go back and reread your history books. Growth occurred as a result of returning soldiers to the US, however the workforce didn't grow significantly. The change was in the member of the household who was working. Housewives went back home and dads went from the battlefield to office or factory or wherever else they were before the war. However, they did have cash in their pockets in the form of savings and post military duty pay, which translated into added non-taxed dollars that could be spent.
(dramatic pause)
(Did you say..."non-taxed"?)
I did, though it may be a misnomer since much of the extra dollars were in accumulated savings and may have already been taxed when first paid. Military pensions did add quite a bit to the regular earnings, so it was as if a majority of American Families suddenly had more income than they were used to and could afford what they hadnt' been able to afford previously (Because they paid into a tax system that topped out at 91%).
So the housing boom and the baby boom both took off, creating more jobs and greater, more wide-spread demand for goods and services. Of course, this couldn't last forever, because wages can only rise so much before it becomes untenable. Hence, the tax CUT that followed. People had to keep up with all those new houses, cars, babies, etc, and most importantly with the Jones. So many people had started out from the same post-war position, it became very easy to feel like everyone had the same stuff; almost as if that's the way it had always been. Of course, it hadn't. But hey, we're Americans, our memory is only as good as whatever distraction happens to get in the way.
Of course, in keeping up with the Jones, people all felt as if they deserved to have whatever anyone else had and therefore spent as if the money would never end. Savings rates plummeted and the lessons learned in the 30's dwindled away, as people chose instead to focus on shiny cars and fancy vacations. Some of those vacations were spent where? You Guessed it...Hilton Hotels, where a guy had an idea that he would cater to the growing class of vactioners and provide them with a home away from home in his hotels around the world. Of course, you knwo this man as Conrad Hilton. In the meantime, he employed thousands of workers who in turn spend those wages at the businesses nearby and on goods and services produced all over the globe. He created commerce. Unfortunately, he created something else, which may have been what you were alluding to in your post. We can thank him for dedicating a portion of his legacy to one of his dearest and most precious grand-daughters...The lovely Paris Hilton.
My good CW, now you have the rest of the story.
I eagerly await your response.
StopWhiningAlready -
OK, since I extended the extra time to you, I've got to ask for some myself. I'll get to your comments later, promise.
While skimming what you wrote, though, I did have to say one thing (in her defense, actually):
I thought Paris Hilton did a better job acting in the remake of "House of Wax" than most people gave her credit for.
Just wanted to say that...
More later, promise.
-CW
One more thing (this is tangental to the main points you raise)...
I've filed as a sole proprietor (self-employed) and as a partnership (um... sched. K, I think?), but never as a corporation. So I'm unaware (on a personal level) of corporate taxes. Just wanted to toss that out there.
-CW
...so long as it's before the end of the august recess. You're on your own as for claims for PH's acting abilities. And as for the tax filing comment, I was just responding to your previous comment that you had filed a schedule C since the age of 19. I figured you hadn't and instead were filing something else, but the strong proclamation on your end wasnt supported by the degree of familiarity I would have anticipated from someone who had been wrestling with that particular tax form for ? years. My point being - you cannot claim that business pay no tax, support the claim by stating that you know because you've been claiming and paying as a particular type of business, only to retreat later stating that you'd actually never paid taxes as a business at all (and thus have no actual, first hand knowledge of what you were talking about).
-SWA
SWA -
I think we're kind of talking past each other here. And I will gracefully let that question mark remain unnumerated (if that's even a word)...
[Update: Upon reflection, I think it should be "unenumerated"...]
I was just trying to clarify something. The IRS divides businesses into three main categories. Self-employed, partnership, and corporation. Self-employed folks fill out Schedule C. Partnership fills out (I think) Schedule K and K-1. Corporations (which have many sub-categories) fill out their own version of the 1040 form (1060? something like that), and you have to be incorporated to use this. I've never incorporated, that's all I was saying. I have indeed paid taxes as a business, but not all businesses pay taxes (if you have a loss, or don't make any money, you don't pay taxes). So I'm not trying to claim any knowledge that I don't personally have, that's all. Hope this clears it up... don't read too much into my Schedule C knowledge, is all I'm saying, when talking about corporate taxes, as they're two different things.
Still don't have time now to tackle your beer analogy, but I will get to it.
-CW
CW,
To your point that we're talking about different taxes, and that those (business owners) who don't earn a profit don't pay taxes, that's untrue. Owners of C-corporations organized as non-publicly traded closely held businesses pay taxes on the salary they pay themselves (both as income tax to the owner/recipient and in the form of employment taxes such as FICA, FUTA, SUTA) regardless of whether the company itself makes a profit. In fact, even if the company makes a profit, but doesn't want to pay all that extra money out, the company will be penalized and taxed if it retains its earnings beyond a level dictated in the statute, so there's no way to avoid it. In addition, here's a little list of all the taxes we pay as Americans. Ridiculous...
Accounts Receivable Tax
Building Permit Tax
Capital Gains Tax
CDL License Tax
Cigarette Tax
Corporate Income Tax
Court Fines including speeding tickets(indirect taxes)
Dog License Tax
Federal Income Tax
Federal Unemployment Tax (FUTA)
Fishing License Tax
Food License Tax
Fuel Permit Tax
Gasoline Tax (42 cents per gallon)
Hunting License Tax
Inheritance Tax
Interest Expense (tax on the money)
Inventory Tax I
RS Interest Charges (tax on top of tax)
IRS Penalties (tax on top of tax)
Liquor Tax
Local Income Tax
Lottery Tax (ok, not a real tax, but cost of a ticket could be construed as a tax on stupid people who cannot do math)
Luxury Taxes
Marriage License Tax
Medicare Tax
Property Tax
Real Estate Tax
Recreational Vehicle Tax
Road Toll Booth Taxes
Road Usage Taxes (truckers)
Sales Taxes
School Tax
Septic Permit Tax
Service Charge Taxes
Social Security Tax
State Income Tax
State Unemployment Tax (SUTA)
Telephone Federal Excise Tax
Telephone Federal, State and Local Surcharge Taxes
Telephone Federal Universal Service Fee Tax
Telephone Minimum Usage Surcharge Tax
Telephone Recurring and Nonrecurring Charges Tax
Telephone State and Local Tax
Telephone Usage Charge Tax
Toll Bridge Taxes Toll
Tunnel Taxes
Trailer Registration
Tax Utility Taxes
Vehicle License Registration Tax
Vehicle Sales Tax
Watercraft Registration Tax
Well Permit Tax
Workers’ Compensation Tax
So we are taked when we make money, spend money, save money, invest money -- and die. Where is the value in return? Maybe Government as nanny state isn't the answer.
StopWhiningAlready -
OK, sorry for the delay. I've been struggling with hardware and software updates, but am now back up and running.
I actually agree with you, up to a point, on the homeownership thing. I think politicians of BOTH parties latched onto the homeownership numbers in America as some sort of holy grail. Clinton did it, and so did Dubya Bush. They got what they wanted -- they could appear in public and proclaim "homeownership numbers are higher now than they've ever been in history!" I'm sure if you took the time, you could find this quote -- verbatim -- from both Clinton and Bush. But to achieve this political goal, they both wound up cutting some corners. We're living with the fallout.
But there is indeed discrimination in bank lending. This has been proven over and over again, even recently. Stings have been done where a black man and a white man -- with EQUAL credit ratings and paperwork -- go into a bank. The white guy gets offered a loan. The black guy doesn't. So please explain this, if lending is so colorblind.
And since you were doubtlessly in the back of my mind when I wrote about beer yesterday, allow me to address what I have to admit is a pretty good analogy -- your ten guys having a round of beer.
Let me paste it in here, so I don't have to keep scrolling back and forth:
The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.
Ah, but that assumes equal treatment by the government, which simply does not exist in this country. For just one example of this, compare police response times in poor neighborhoods with wealthy neighborhoods, in the same police district. Or pothole repair in those same neighborhoods. Not to mention schools. So I would add to your analogy what each man actually got.
The first four men would have to fill out many forms, even though their beer was free, and they would receive mugs of dishwater with the word "beer" hastily written on the side, after waiting two weeks. The fifth guy would recieve near-beer, and get a headache. The sixth guy would receive an off-brand domestic lite beer. The seventh guy would get a Budweiser. The eighth guy would receive a Heineken. The ninth guy would receive a Guinness. The tenth guy would be served before anyone else, and receive a bottle of single-malt whiskey, with its label removed, and the word "beer" hastily written on the side. The tenth guy would also have to fill out a lot of forms, but he would pay someone else to do this for him. He would get the single malt because he had spent a lot of money lobbying Congress to change the beer distribution laws to add a loophole for people in his exact circumstance.
OK, that's not perfect, but you can see what I mean. Government services, whether local, state, or national, are not given out or consumed equally by all. The relative wealth of the consumers almost always enters the equation somewhere, although it's not always obvious.
Or, perhaps, another way to address the faults of your analogy is to point out that the tenth guy may (on paper) seem like he's paying $59, but that when he actually pays his bill, he's only paying $12, and the bar owner gets stiffed (see: capital gains versus income taxes, and the Social Security cap on earnings, or the question "why does AT&T pay no taxes?" which addresses corporate loopholes).
Or, the tenth guy says "all my money's in Swiss banks, I don't have any actual dollars, sorry." (see: offshoring money). This would be the equivalent of the tenth guy "not showing up" the next night.
Capital gains is the one that really burns me up. EVERY way there is of making money in America is taxed (theoretically) on the same scale. Except one. What a surprise -- it's how the ultra-wealthy make money! Again, were the 1950s a decade of doom and gloom in the economy? Perhaps tax rates and expansion are not as inextricably linked as the wealthy have been telling us for the past few decades.
As for tax credits, the vast majority of them aren't refundable. The EIC is, and others may be, but most of them if you don't pay any taxes, you can't take them.
OK, I gotta take a break, I'll return to the fray later and address your other comments. But I'd like to throw out an analogy of my own first.
People keep saying "government can't create anything better than the private sector." Or "give me an example of government doing something better." Or other similar complaints.
I could talk about going to the moon here, versus what Richard Branson is doing. How long did it take private industry to follow in the footsteps of a successful government program?
But that's kind of a silly example, as is things like the military.
So here's one for doubters of the power of government ideas. Your tax dollars (or your parents', more like) went into researching a brand new technology. They developed this technology, deployed it for their own (military) purposes. Later, other uses were invented which rode on the backbone of this technology. So it was expanded. Private industry got interested. New ideas came up. The best new idea came from a European (yes, it wasn't even American) consortium funded mostly by either direct government money or university money. This radical new idea expanded the basic idea to an almost limitless scope. It is now the backbone of (I'm guessing, here) a multi-TRILLION dollar industry (mostly private, but the government occasionally gets good use out of it too).
You need look no further than the words on your screen to discover of what I speak. Look into DARPA (Pentagon research and development branch), and ARPAnet, and Ethernet, and (finally) the Internet. The great leap forward was done by CERN, in Switzerland -- the invention of the world wide web. Which created the medium (and the underlying backbone) you now see in front of you. Which was started as a government program to allow nuclear researchers to communicate easily with each other.
You can even extend the analogy to the story of Netscape, where a bunch of people being educated with public subsidy (University of Illinois, as I recall) had a great idea, put it out for free, and then started their own company and made a pile of money. None of which would have been possible without the dorm they lived in being at least partially paid for by tax dollars. The creation of the "browser" itself has its roots in tax dollars, too.
How's that for a "rest of the story"?
(more later, promise!)
-CW
chris, i think you're underestimating the extent of guy #10's advantages. he would actually create a beer PAC, hire lobbyists to create a tax loophole, then receive a no-bid government contract, outsource the brewing to guatemala causing guys 5 and 6 to lose their jobs, while writing off the profits as public service and taking free samples of the highest quality product for himself. then he'd hide most of the remaining profits in offshore tax shelters and spend a small percentage to organize complaints by guys 7 through 9 about how unfair it is having to pay higher taxes than the other guys.
Sorry Chris that I'm late to the game on this, but you are off big time on you small business explanation. I am a small business owner and like most small business owners I have a Subchapter S Corp. Yes you are correct that only the profits are taxed but you are flawed in your understanding of how small business's grow and create jobs. Since the tax cuts that you all complain about, I was able to create 19 new jobs (full time with bennies). In order to have that growth, I have to invest in my business, this generally means a small business loan. Those loan payments are NOT deductable, thus CASH FLOW does not follow profits. Profits are only on paper for for the years that it takes to pay down that debt. Since you have been a schedule C guy you should be aware that when lets say an extra 150k is added to you personal income (in profit) then the tax percent is now due on that money reguardless of debt service or not. Since we are investing in the business and creating jobs, the business must have the cash flow to bonus out the tax money. A tax increase will further squeeze out cash flow. In my business, one that has gone from 14 employees to 33 under the Bush tax cuts, we will either be forced to lay off in order to cover the increased tax burdon or we will have to stay stagnet, not invest, not grow and not create more jobs to increase cash flow to cover the additional tax. There are over 900,000 "S" corps in the US and we are among the largest creaters of jobs in the small business world. I started from nothing and I hope to continue to grow. Tax increases of any kind on growing small business' has a negative effect. I don't know what business you are referring to when you say that everything is deductable. As far as the 91% tax rate that you mention, there were infinitely more shelters as a result of that insanity so I would contend that those numbers were seldom actually collected. The $250k crowd is already paying an unfair % of tax and since nearly 64% of all American income tax is collected by the 250k and above group and nearly 40% of Americans are paying no net income tax, I think that "Fairness" needs to be extended both ways. Like many small business'we took risks others would not take, we had lots of sleepless nights because we put up our homes and everyting we had on the line to get to the 250k point. It seems that to the entitlement crowd that fairness is defined as "let someone else pay". Tax cuts have a powerful effect on our ability to create jobs. We are living proof. Personally, I think a lot of us are tired of the cries of "tax the rich". One last point, 250k on west coast or hear in the northeast doesn't make one rich!