The Bush Tax cuts...

[CorvallisBMW]

I'm curious as to how some of our conservative member on this board feel about these tax cuts being extended in the wake of the overwhelming victory by Republicans in November on the basis of cutting the deficit.

The CBO (Congressional budget office) estimates the tax cut for the wealthiest Americans (top 2% of income earners) to be $140bn over the next 2 years of the extension. Included in the bill is also a revision of the estate tax which lowers the rate from a maximum of 55%, beginning at $1M, to a maximum of 35%, beginning at $5M. That is estimated to cost $88bn over the next two years.

http://money.cnn.com/2010/12/07/news/economy/tax_cut_deal_obama/index.htm?hpt=T2

So after lots of pandering and yelling about deficits and high debt and a need to reign it in, the republicans just fought hard for and negotiated a $226bn tax break for millionaires and only millionaires... Adding $226,000,000,000 to the national debt. I'll also point out that according to the CBO, tax breaks for wealthy individuals is the least effective way of stimulating the economy:
http://cbo.gov/ftpdocs/118xx/doc1187..._Testimony.pdf

If you voted Republican in the last election, hoping to see a reduction in deficit spending and the national debt, how do you feel about this? I'm not trying to stir up shit, I just can't see how anyone can take these guys seriously. The only reason they won is because there was a serious grass-roots movement for fiscal responsibility that helped put them in to office. Now they turn around and borrow hundreds of billions of dollars from China and give it away to rich people, knowing full well it will do little if anything to help the country recover... It doesn't make any sense to me :loco:

[z31maniac]

I'm torn. As I agree that the tax rates did not need to go higher on anyone, period.

However, the cuts for the middle class cost SUBSTANTIALLY more than the cuts for the rich, yet you completely ignore this fact (over the course of 10 years, the tax cuts for the middle class would cost 4.5 times MORE than the cuts for the wealthy). The Republicans said "all or nothing" they didn't fight for only the rich, unfortunately, it looks like they gave away plenty of other stuff to get it.

I hope you're sitting, because this is an unlikely POV for me. But I actually think the "payroll tax holiday" should be MUCH MORE aggressive than a 2% reduction in SS taxes. I would go for a complete "tax holiday" on the federal income tax (and yes have to borrow it for the year). My gut tells me if people were able to take home a lot more money next year, pay off some debt, get some money in the bank it would be a huge positive for the country. For me alone, no federal income tax for the year would add nearly $8k to my take home pay next year. I could get a lot done with that, and nearly all of it would be used to "stimulate the economy."

And mainly from the improved mindset people would have, or consumer confidence if you will.


EDIT: The estate tax? I don't think there should be one period. Why you aren't allowed to pass on your accumlated wealth to your family is beyond me. The money was already taxed when it was earned by the deceased, why does it get to be taxed again?

[mrsleeve]

I'm torn. As I agree that the tax rates did not need to go higher on anyone, period.

However, the cuts for the middle class cost SUBSTANTIALLY more than the cuts for the rich, yet you completely ignore this fact (over the course of 10 years, the tax cuts for the middle class would cost 4.5 times MORE than the cuts for the wealthy). The Republicans said "all or nothing" they didn't fight for only the rich, unfortunately, it looks like they gave away plenty of other stuff to get it.

I hope you're sitting, because this is an unlikely POV for me. But I actually think the "payroll tax holiday" should be MUCH MORE aggressive than a 2% reduction in SS taxes. I would go for a complete "tax holiday" on the federal income tax (and yes have to borrow it for the year). My gut tells me if people were able to take home a lot more money next year, pay off some debt, get some money in the bank it would be a huge positive for the country. For me alone, no federal income tax for the year would add nearly $8k to my take home pay next year. I could get a lot done with that, and nearly all of it would be used to "stimulate the economy."

And mainly from the improved mindset people would have, or consumer confidence if you will.


EDIT: The estate tax? I don't think there should be one period. Why you aren't allowed to pass on your accumlated wealth to your family is beyond me. The money was already taxed when it was earned by the deceased, why does it get to be taxed again?

X2 I could not have said it better myself.

Oh the tax withholding's on this fridays paycheck (2 week pay cycle) for me is going to be about 3800 bucks federal portion of that is gonna be about 1700ish of that I think.

[joshh]

It'll be a pointless venture either way if they don't learn to work within a real budget. In other words I don't see things getting better from this alone because our politicians will still juice the system and we as tax payers are paying for some seriously ridiculous things.

[LBJefferies]

I'm cool with tax cuts for anybody so long as they are accompanied by spending cuts. Instead of doing that however, Obama decides he's going to extend unemployment benefits along with the tax cuts. GREAT IDEA! :down:

[ck_taft325is]

I'm torn. As I agree that the tax rates did not need to go higher on anyone, period.

However, the cuts for the middle class cost SUBSTANTIALLY more than the cuts for the rich, yet you completely ignore this fact (over the course of 10 years, the tax cuts for the middle class would cost 4.5 times MORE than the cuts for the wealthy). The Republicans said "all or nothing" they didn't fight for only the rich, unfortunately, it looks like they gave away plenty of other stuff to get it.

I hope you're sitting, because this is an unlikely POV for me. But I actually think the "payroll tax holiday" should be MUCH MORE aggressive than a 2% reduction in SS taxes. I would go for a complete "tax holiday" on the federal income tax (and yes have to borrow it for the year). My gut tells me if people were able to take home a lot more money next year, pay off some debt, get some money in the bank it would be a huge positive for the country. For me alone, no federal income tax for the year would add nearly $8k to my take home pay next year. I could get a lot done with that, and nearly all of it would be used to "stimulate the economy."

And mainly from the improved mindset people would have, or consumer confidence if you will.


EDIT: The estate tax? I don't think there should be one period. Why you aren't allowed to pass on your accumlated wealth to your family is beyond me. The money was already taxed when it was earned by the deceased, why does it get to be taxed again?

Agreed.

Hopefully, and this is a big hope, the 140b over the next two years, at least half see's it's way back into the US Economy in some way or another.

[e30e]

I'm cool with tax cuts for anybody so long as they are accompanied by spending cuts. Instead of doing that however, Obama decides he's going to extend unemployment benefits along with the tax cuts. GREAT IDEA! :down:

How do you expect the laid off people to have christmas, it was purely a political move to appear that he's working with the republicans.

[CorvallisBMW]

I'm torn. As I agree that the tax rates did not need to go higher on anyone, period.

However, the cuts for the middle class cost SUBSTANTIALLY more than the cuts for the rich, yet you completely ignore this fact (over the course of 10 years, the tax cuts for the middle class would cost 4.5 times MORE than the cuts for the wealthy). The Republicans said "all or nothing" they didn't fight for only the rich, unfortunately, it looks like they gave away plenty of other stuff to get it.

I hope you're sitting, because this is an unlikely POV for me. But I actually think the "payroll tax holiday" should be MUCH MORE aggressive than a 2% reduction in SS taxes. I would go for a complete "tax holiday" on the federal income tax (and yes have to borrow it for the year). My gut tells me if people were able to take home a lot more money next year, pay off some debt, get some money in the bank it would be a huge positive for the country. For me alone, no federal income tax for the year would add nearly $8k to my take home pay next year. I could get a lot done with that, and nearly all of it would be used to "stimulate the economy."

And mainly from the improved mindset people would have, or consumer confidence if you will.


EDIT: The estate tax? I don't think there should be one period. Why you aren't allowed to pass on your accumlated wealth to your family is beyond me. The money was already taxed when it was earned by the deceased, why does it get to be taxed again?

I agree with you on the payroll tax. Everything I've heard and read from leading economists say that it would be the best way to put money back in to people's hands (and the economy) right now..

But as far as tax cuts for the wealthy? It's widely known that investing by companies, banks, private individuals and all other sorts of entities is very limited right now. Everyone is just sitting on their money, kind of afraid to spend it and unsure of what to do. Giving a tax break to millionaires only means they will have more money to sit on, which doesn't do anyone any good.

Give a tax break to someone who makes $50K a year and I guarantee they'll spend every penny of it. Give a tax break to someone making $5M a year and they'll probably just put it in the bank (which isn't lending...)

Same goes for the unemployment benefits. Every single dollar goes straight back in to the local economy. In fact if you read the CBO report, they estimate that for every $1 spent on unemployment benefits, $2 of economic payback is created.

Yes I fully realize that the middle class tax cuts cost more than those for millionaires. But that's because they cover 98% of the population, not just 2%. They may cost 4.5 times more, but they cover 50 times more people. Also, as pointed out by the CBO, they are far better at stimulating economic growth.

[shiftbmw]

OP, you're confused because you view a tax cut as a form of government spending.

The government takes a shitload of money to cover a lot of bullshit, inefficient, wasteful programs and such that are completely unnecessary. I prefer that they take less from taxpayers and eliminate these types of programs.

[joshh]

I agree with you on the payroll tax. Everything I've heard and read from leading economists say that it would be the best way to put money back in to people's hands (and the economy) right now..

But as far as tax cuts for the wealthy? It's widely known that investing by companies, banks, private individuals and all other sorts of entities is very limited right now. Everyone is just sitting on their money, kind of afraid to spend it and unsure of what to do. Giving a tax break to millionaires only means they will have more money to sit on, which doesn't do anyone any good.

Give a tax break to someone who makes $50K a year and I guarantee they'll spend every penny of it. Give a tax break to someone making $5M a year and they'll probably just put it in the bank (which isn't lending...)

Same goes for the unemployment benefits. Every single dollar goes straight back in to the local economy. In fact if you read the CBO report, they estimate that for every $1 spent on unemployment benefits, $2 of economic payback is created.

Yes I fully realize that the middle class tax cuts cost more than those for millionaires. But that's because they cover 98% of the population, not just 2%. They may cost 4.5 times more, but they cover 50 times more people. Also, as pointed out by the CBO, they are far better at stimulating economic growth.

I have to point it out to you yet again but it's their money and if they want to save it that's entirely up to them. Just because someone who is rich saves their money as opposed to giving it out for redistribution saves it means they are evil as usual.

Then why don't we invest in unemployment? Because regardless of what the CBO says it's not a way to stimulate the economy when you have to borrow the same money you're trying to stimulate the economy with. It's part of the reason we're in this situation in the first place.

[NKRoberts]

OP, you're confused because you view a tax cut as a form of government spending.

The government takes a shitload of money to cover a lot of bullshit, inefficient, wasteful programs and such that are completely unnecessary. I prefer that they take less from taxpayers and eliminate these types of programs.

Yeah I agree with this!

[z31maniac]

But as far as tax cuts for the wealthy? It's widely known that investing by companies, banks, private individuals and all other sorts of entities is very limited right now. Everyone is just sitting on their money, kind of afraid to spend it and unsure of what to do.

And that has to do with many of the legislative desires of Congress. Cap-and-tax, healthcare, DREAM act (so stuff that has already or is trying to be passed) all of which will have a huge ecomonic impact on business. No one wants to move until they KNOW what these economic costs will be.

SOmething that I've heard argued by Republicans, that I honestly haven't researched and need to, is that many small business owners handle the taxes for their business on their personal tax returns. So raising taxes on families that make more than $250k ($200k individual) will end up taxing many small businesses.


ANother thing I would like to see, but I'm not even sure how you would go about it, is to see where the RICH families are located across the country. If you are an individual who lives in Tulsa and makes $200k+ a year, yes you live a pretty comfy lifestyle. If you make $200k and live in Manhattan, you have a small apt and ride the bus/subway to work.

Also I'd like to see what types of small business file on their personal returns and what kind of money we are talking about. Or what the limit is for being able to file on your personal returns vs having to file taxes for the business.

For instance, if you filed on your personal taxes with a business that grossed say $750k, that seems like a lot of money, until you realize the "business" had $675k in expenses/inventory/overhead, so in reality, the proprietor made less than $100k before they pay there self-employment tax, SS/Medicare taxes, etc.

In reality, both sides are pulling a few points and making it a black/white issue when there is obviously many more facets that affect the debate. Not that is any different than usual though.....

[LBJefferies]

But as far as tax cuts for the wealthy? It's widely known that investing by companies, banks, private individuals and all other sorts of entities is very limited right now. Everyone is just sitting on their money, kind of afraid to spend it and unsure of what to do. Giving a tax break to millionaires only means they will have more money to sit on, which doesn't do anyone any good.

Sorry but that's wrong. The only way to sit on money is to literally keep it in a shoe box under your bed. Even if lending is low, there is still some of it going on and if there is more money in the bank lending will increase. Millionaires are the best people to have money right now because they don't need to worry about saving money to feed their families and put their kids through college. They are more willing to invest and take risks because they essentially don't need the money.

Tax cuts of any kind and for anybody are a good thing.

[sn8kbit]

A few issues I have, from a new guy:

A) This isn't a tax cut, it's maintaining the current rates. I'm still trying to wrap my head around just how this will add to the current deficit, considering it's currently unearned non-existing revenue. The thought of "Well, we would have 700 bil, now we won't, so it automatically increases our current debt." Makes no sense to me unless, the backroom forced deals like Obamacare relied on the potential funds (albeit partially) to pay for these types of programs, and rolled it off until 2011. The only thing I can relate it to is losing a 4k a month contract a few years back. I didn't go into immediate 48k in debt for the next 12 months, I simply had to adjust my spending to adjust for the lower revenue. Then again, I didn't spend it before I had it either.

To be clear, there is no "fair tax" on any income earner. Call me a supporter of HR 25, called the "Fair Tax", I liken it more to "reasonable tax". Additionally, consider small business "investments" to include new employees and expansion. Yes, employees can be considered investment, attitude and work ethic can make impressions and increase business, allowing for more employees. This stimulates economy more than any collected tax revenue disbursed as unemployment insurance. That's one more "tax payer" now, instead of another "tax paid by you" handout. Sounds cold, sure, but the longer you sustain an individual, the less incentive to do for themselves. Welfare has always worked, right?

It's time we stop punishing success in this country, and rewarding apathy and laziness under the guise of "helping the helpless". I think you'll find this would also lessen some welfare programs and even lighten the illegal immigration problem also. Personal opinion, most of the "helpless" living on the government tit are only helpless because we allow it.

B) Unemployment extension as stated can be confusing. It's not extending those at the previously extended limit. Those on 99 weeks are through. What it does create is an extension for benefits to those who have not reached the 99 week limit.

I can only agree with Obama's statement about the deal with regards to time. Something needs to be done immediately. Neither group is happy about it, but it gives and additional 2 years of time to hash it out, get it right (or wrong, depending on your slant), all while relieving stress on all of us, temporary as it is.

Tax on income is control, plain and simple. Don't pay, go to jail. You'll never see an income tax go away (unfortunately) because then the government can't control any individual.

Pick it apart as you will, just my personal views on the matter, as I'm neither Republican or Democrat, but we have to quit spending first with money we don't/might have.

[CorvallisBMW]

OP, you're confused because you view a tax cut as a form of government spending.

The government takes a shitload of money to cover a lot of bullshit, inefficient, wasteful programs and such that are completely unnecessary. I prefer that they take less from taxpayers and eliminate these types of programs.

No, I'm not. I never said one was the same as the other.

They both do add to the national debt however. And seeing as how these tax cuts were not paired with any spending cuts, it works out to have the same effect.

Whether you take $100 out of your savings account (spending) or take in $100 less on a paycheck (tax cut), you still have $100 less.