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Of course you realize, this means class war!

Discussion in 'Tilted Philosophy, Politics, and Economics' started by Baraka_Guru, Sep 20, 2011.

  1. What strikes me is that Fleming appears to be blurring the lines between his corporate profits and his personal income from those profits. Lumping together wages paid, business expenses and feeding his family? Maybe the IRS should look into his bookkeeping practices?
     
  2. Aceventura

    Aceventura Slightly Tilted

    Location:
    North Carolina
    Look beyond the superficial. Obama has almost no support for his jobs bill. His jobs bill is not serious. His jobs bill is political theater. His jobs bill is designed for his re-election bid, not passage into law. Even Harry Reid in the Senate is not taking it seriously or with any urgency at all.

    http://abcnews.go.com/blogs/politics/2011/09/obamas-jobs-bill-pretty-well-jammed-in-the-senate/
     
  3. redux

    redux Very Tilted

    Location:
    Foggy Bottom
    If you look at the tax system closely, you will see that most of the uber-rich pay a lower rate on a significant portion of their earnings than the middle class -- a 15 % capital gains rate vs the middle class bracket, where nearly all of the earnings are in the form of taxable wages at a 25% rate.

    Add to that the 6+% FICA tax on wages under $100k (approx), the imbalance is even greater, given that wages over $100k and capital gains are not subject to this tax.

    I read this somewhere and it hit the mark for me:

    Whenever I hear one of the rightwing conservative pundits whine about how any attempt to redress some of the imbalances in the tax system constitutes an act of 'class war', I get a mental image of a large man kicking a little guy in the guts repeatedly and then when the little guy lands a blow, the large man cries assault.​

    As the article that baraka posted earlier, the uber-rich won the war:

    http://www.guardian.co.uk/commentisfree/cifamerica/2011/sep/19/class-war-america-republicans-rich

    The conservatives continue to politicize every attempt at addressing the issue as "class warfare" and govt stimulus and small business tax incentives as (gasp) "European socialism"... and as a result of that intransigence, there is uncertainty and a continuing cost to the economy and most hard working Americans.
     
  4. Aceventura

    Aceventura Slightly Tilted

    Location:
    North Carolina
    The "uber-rich" pay in taxes what they are willing to pay.

    Over several years i wonder if some simple points will ever sink in. The "uber-rich" have choices regular people will never have. It is because of those choices the class warfare rhetoric is a waste of time. If you raise the capital gains rates to what the "uber-rich" finds unreasonable the "uber-rich" won't realize capital gains. Or, the tax impact will be priced into their decisions, "trickling down" to the average consumer. For example if commercial real-estate with large unrealized capital gains is being held by a "uber-rich" person, they have the choice of not selling. But, they can still get cash out of their investment if needed, one way is by simply using debt. Or, what we would find is that the cost to rent and buy commercial real-estate goes up, basically offsetting the cost of the tax increase to the "uber-rich" person. Short of the government simply going in and confiscating wealth, the "uber-rich" can sit back and snicker at these attempts at "tax fairness". The only real tax fairness is having a tax code that strives to be neutral.
     
  5. Baraka_Guru

    Baraka_Guru Möderätor Staff Member

    Location:
    Toronto
    "Fairness," of course, is relative. Just ask monarchs and libertarians.
     
  6. redux

    redux Very Tilted

    Location:
    Foggy Bottom
    Perhap your "simple points" are baseless ideological rhetoric that you never cannot or will not document, much like your flat tax that we discussed months ago for which you could not or would not provide a model that works.

    Are you really suggesting that the "uber rich" did not realize capital gains in the 90s? Or that the lower capital gains rate and the lower marginal tax rate (2+% lower) on top wage earners enacted in 01 and 03 "trickled down" and stimulated the economy...to the tune of an 8+ million private sector job loss and more than $1 trillion contribution to the debt.

    Or perhaps that job loss (more than the last four recessions combined) and revenue loss wont ever sink in.
     
  7. Aceventura

    Aceventura Slightly Tilted

    Location:
    North Carolina
    Tax policy should reflect actual costs to govern and should be apportioned in a simple unbiased manner.

    In many states/counties, I think their property tax systems reflect fairness and are much less prone to abuse than our federal income tax system is. In many cases poor people do not directly pay property taxes but they do receive benefit of government service - in the case of fire protection it is theoretically equal (I was raised near Chicago and everyone knows Mayor Dailey Sr. always got his roads shoveled first after a big snow, but otherwise...)
    --- merged: Sep 26, 2011 11:41 PM ---
    Your buddy Warren Buffet didn't.
     
  8. roachboy

    roachboy Very Tilted

    so effectively, ace supports all the current modes of class warfare republican style.
    and like a typical petit-bourgeois, he thinks the problem is that people like him are the real victims of it, and not the poor or otherwise disadvantaged. o no.
    it's poujadisme. a pure amurican restatement.
     
  9. Aceventura

    Aceventura Slightly Tilted

    Location:
    North Carolina
    Your views along with the views of some others here often require a form of irrational behavior that I do not see in my day to day dealings. I am curious how you see this example:

    A person has $1 million dollars to invest over 10 years.

    Option A is putting the money into US treasuries earning 3% per year, with 100% probability of the return of the $1 million - let's call this a virtual risk free investment - all other thing being equal, blah, blah, blah...

    We introduce risk.

    Option B is putting the money to work in a private enterprise earning (dividend or income) 3% per year with a 50% probability of $500,000 being returned or a 50% probability of $1.5 million being returned.

    Clearly there is no right or wrong answer, option A or B simply depends on an individual risk tolerance.

    But now add in a 35% capital gains tax. With this tax if there is a $500,000 capital gain, there is a $175,000 tax.

    With the 35% capital gains tax there is clearly a correct answer, a rational person would take option A.

    Tax policy has an influence on economic behavior.
    An excessive capital gains tax rate will be avoided by rational people up to the point where a risk adjusted return equalizes with a risk free return.
    Capital gains taxes can be avoided - easily.

    From a broader point of view, does our economy benefit more from people buying treasury bills or investing in private enterprises - oh, perhaps the type that may create jobs and taxable wealth.

    I am just a simply person, no MBA or other advance degrees or anything like it, but perhaps simply what you call a "republican style" outlook. So I am curious how does the pseudo-intellectual crowd view this?
     
  10. roachboy

    roachboy Very Tilted

    ace--where do you come up with these stupid analogies?
    do you have a book of stupid analogies you use?
     
  11. Aceventura

    Aceventura Slightly Tilted

    Location:
    North Carolina
    It is called the "real world".

    The day I decided to invest my life's savings in my business - I had a choice. I could either put it at risk in my business or I could invest it in things like triple A rated bonds and other virtually risk free investments. Every day in my business i face decisions of how to allocate capital - do I re-invest - do I take money out and invest in other things....come on Roach??? Perhaps I don't get what you are saying.
     
  12. Bodkin van Horn

    Bodkin van Horn One of the Four Horsewomyn of the Fempocalypse

    Nevermind that treasuries are subject to capital gains taxes too...
     
  13. Aceventura

    Aceventura Slightly Tilted

    Location:
    North Carolina
    Is that it?
     
  14. Bodkin van Horn

    Bodkin van Horn One of the Four Horsewomyn of the Fempocalypse

    I fail to see the point of your example.
     
  15. Aceventura

    Aceventura Slightly Tilted

    Location:
    North Carolina
    From post #29:

    Primarily related to the long standing disagreements with many here on the impact of tax policy on behavior. However, I know my view. I specifically asked for the point of view of those who I consider to be "psuedo-intellectuals" or those who have strongly held theoretical views with no apparent experience.
     
  16. Bodkin van Horn

    Bodkin van Horn One of the Four Horsewomyn of the Fempocalypse

    But both of your investment examples are subject to similar taxes and you used an inaccurate figure for capital gains tax.
     
  17. dippin Getting Tilted

    Oh, give me a fucking break with this whole "I am just a regular guy with real world experience."
    Interest on treasury bills is taxed at the regular income tax rate, which is higher than the capital gains tax. That alone should prove your example wrong and that you have no idea what you are talking about.
     
  18. Bodkin van Horn

    Bodkin van Horn One of the Four Horsewomyn of the Fempocalypse

    Except that you yourself are a pseudo-intellectual who holds belief with no apparent experience. The examples you offer for their elucidatory relevance generally demonstrate the fact that you don't really know what you're talking about.

    Investors will invest where there is money to be made. They invested when capital gains rates were higher. The types of taxes relevant to this discussion eat into money that was already made. Assuming that this remains the case, altering rates could have the effect of disincentivising certain types of investments over others, but it shouldn't dissuade anyone sitting on $10 million from finding a productive place to put that money.

    Also, your example is flawed because investment in treasuries is not risk free. Even if there's no real risk of default, there is a very real interest rate risk and managing these risks would require a more complicated set of choices than your A and B.
     
  19. Baraka_Guru

    Baraka_Guru Möderätor Staff Member

    Location:
    Toronto
    You know, this is a lot like asking, "What benefits the human body more, eating food or eliminating waste?"

    It's really tempting to say that eating food is better because it gives nutrients and energy! But, holy shit, eliminating waste is pretty important too.

    It's a good thing we don't have to pick one over the other.
     
  20. Bodkin van Horn

    Bodkin van Horn One of the Four Horsewomyn of the Fempocalypse

    That, and investment in treasuries can contribute to job creation and taxable wealth and investing in private enterprises need not actually contribute to job creation and taxable wealth.