Barack wants your money

[bobblehead]

The saddest part of this is that the majority of his audience has no idea what the term "Socialist" even means.

Do you know what socialism means, Howie? How do you explain the fact that you (along with the rest of the wing nuts) continually conflate socialism and capitalism?

the problem with liberals is that they think there is a 'set' amount of wealth and that wealth isn't actually created....if the plumber has a lot of wealth some little guy has none so it must be "spread" around. Newsflash...wealth is created, not some set amount that doesn't change throughout history.

Conservatives seem to forget that a critical component in the creation of wealth is the velocity of the money - the number of times it changes hands. By skimming a bit off the top earners, who would otherwise save it or put it into generic investments, and putting it in the hands of people who will spend it, the velocity of money is increased, increasing the total wealth. And with the numbers we are talking, the rich, as a whole, should do just as well, if not better than before.

And don't bother posting a strawman, I'm not advocating jacking the marginal rates on the high end up to some ridiculous level that could have a negative impact on this.

ok tex....devalue the dollar some more.

hell I'll add more to it I was going to stop there. Giving money to someone who spends it so the guys who earned it can earn it back again is not creating wealth. The guys who create wealth are the top end dudes who put capital together in projects...taking that capital away from them and giving it to spenders does not create wealth. They use the capital to lessen the cost of goods thus helping the lower class indirectly...while creating wealth.

[bobblehead]

The flaw in what you say, MadScientist, is that the great majority of these top earners are NOT retired fat cats or spoiled trust fund brats or whatever bogus image of the rich you are trying to palm off. Rather, most of them are small business owners--entrepreneurs who generally will NOT slow down the velocity of money as you describe, but maximize that velocity by investing in their own business--increases in employees, equipment, and inventory. THAT is what the socialist, Obama either SEEKS to disrupt or ignorantly would disrupt as a consequence of his programs and policies.

If they are investing in their business, then it is a business expense that isn't taxed. The tax is on net, not gross, so your argument is totally invalid, as usual.

sorry...did they change gaap to allow first year full expensing while I am in thailand....wooohooo.

[HowardRoark]

Apropos of this thread….a few good nuggets in this article:

http://www.realclearmarkets.com/articles/2008/10/our_everyone_gets_a_trophy_eco.htm

……When it comes to taxes in general, Barack Obama has made it plain that he would raise the tax rate on the highest earners, while John McCain comforts his supporters with a promise that he would penalize the earnings of the rich at a lower rate. Both candidates miss the disincentivizing nature of taxation.

Realistically, taxes should be seen as a price or a penalty against effort. This is important because no matter how many times politicians tell us they’ll stimulate the economy through income redistribution, the fact remains that economic growth is always and everywhere a function of productive work effort.

Or, as Andrew Mellon (Treasury secretary under presidents Harding, Coolidge and Hoover) noted in Taxation: The People’s Business: “when a man’s initiative is crippled by legislation or by a tax system which denies him the right to receive a reasonable share of his earnings, then he will no longer exert himself and the country will be deprived of the energy on which its continued greatness depends.”

Both Obama and McCain miss Mellon’s point because in quibbling over the correct rate for the most productive taxpayers, they’re advocating that success should be penalized at a higher rate than lack of success. That the vital, productive few create enormous opportunities for every American seems to concern neither.

[LL2]

The flaw in what you say, MadScientist, is that the great majority of these top earners are NOT retired fat cats or spoiled trust fund brats or whatever bogus image of the rich you are trying to palm off. Rather, most of them are small business owners--entrepreneurs who generally will NOT slow down the velocity of money as you describe, but maximize that velocity by investing in their own business--increases in employees, equipment, and inventory. THAT is what the socialist, Obama either SEEKS to disrupt or ignorantly would disrupt as a consequence of his programs and policies.

If they are investing in their business, then it is a business expense that isn't taxed. The tax is on net, not gross, so your argument is totally invalid, as usual.

sorry...did they change gaap to allow first year full expensing while I am in thailand....wooohooo.

No...you still have to do the depreciation over X number of years depending on the "investment."

[bobblehead]

The flaw in what you say, MadScientist, is that the great majority of these top earners are NOT retired fat cats or spoiled trust fund brats or whatever bogus image of the rich you are trying to palm off. Rather, most of them are small business owners--entrepreneurs who generally will NOT slow down the velocity of money as you describe, but maximize that velocity by investing in their own business--increases in employees, equipment, and inventory. THAT is what the socialist, Obama either SEEKS to disrupt or ignorantly would disrupt as a consequence of his programs and policies.

If they are investing in their business, then it is a business expense that isn't taxed. The tax is on net, not gross, so your argument is totally invalid, as usual.

sorry...did they change gaap to allow first year full expensing while I am in thailand....wooohooo.

No...you still have to do the depreciation over X number of years depending on the "investment."

Oh, so his point was completly wrong is what you are saying.

[MadScientist]

Apropos of this thread….a few good nuggets in this article:

http://www.realclearmarkets.com/articles/2008/10/our_everyone_gets_a_trophy_eco.htm

……When it comes to taxes in general, Barack Obama has made it plain that he would raise the tax rate on the highest earners, while John McCain comforts his supporters with a promise that he would penalize the earnings of the rich at a lower rate. Both candidates miss the disincentivizing nature of taxation.

Realistically, taxes should be seen as a price or a penalty against effort. This is important because no matter how many times politicians tell us they’ll stimulate the economy through income redistribution, the fact remains that economic growth is always and everywhere a function of productive work effort.

Or, as Andrew Mellon (Treasury secretary under presidents Harding, Coolidge and Hoover) noted in Taxation: The People’s Business: “when a man’s initiative is crippled by legislation or by a tax system which denies him the right to receive a reasonable share of his earnings, then he will no longer exert himself and the country will be deprived of the energy on which its continued greatness depends.”

Both Obama and McCain miss Mellon’s point because in quibbling over the correct rate for the most productive taxpayers, they’re advocating that success should be penalized at a higher rate than lack of success. That the vital, productive few create enormous opportunities for every American seems to concern neither.

Good idea to quote Hoover's treasury secretary for relevancy in a time of economic crisis

Even if you buy into the concept of marginal rates impacting the desire to earn more, the rates in the early 20's were something like 70%. Do you really think there is that much difference in motivation for a person who pulls in $1 million weather he keeps $64000 or $50000 of his next $10000. I flat out dispute your assumptions with the rates we are talking about.

As for penalizing success, where does this success come from? The success of the rich is dependent on the success of the country as a whole. So what they pay is the price of doing business in the US. Its the cost of keeping the conditions that allow for their successes in tact. By putting your blinders on and looking at this only as a fairness for the rich issue, you are seriously missing the big picture. You are trying to set the US up to fail like the levees in NO, and lead the economy to collapse like the bridge in MN.

[HowardRoark]

By putting your blinders on and looking at this only as a fairness for the rich issue, you are seriously missing the big picture.

Funny, that's exactly what I believe too, only the opposite of how you do. Obama never brings up economics, only "fairness." I see it not as a fair issue at all. I see it as a system that will raise all ships. I think the guy who makes $2 million a year, but employs 60 people is more important than that same guy paying a "fair" amount of taxes that keeps half those 60 out of work, but giving them somekind of bogus tax credit.

BTW, prosperity is right around the corner.........

[mraynrand]

Do you really think there is that much difference in motivation for a person who pulls in $1 million weather he keeps $64000 or $50000 of his next $10000. I flat out dispute your assumptions with the rates we are talking about.

Seems to me a problem often is that Libs aren't very good at math.

incentive to work longer hours at diminished returns is only a part of the issue. Taxation on productivity, and it's effects is a huge issue. In crease taxes on businesses and you change the ball game. Businesses will look to save money by 1) cutting jobs, 2) Increasing prices, 3) moving business to areas with lower taxes. This is what businesses do. Why? Because they are trying to stay competitive. Som when Obama says he wants higher taxes on businesses (and doesn't even understand the Laffer curve - and when told how it works STILL wants to tax higher 'because it's fair') AND AT THE SAME TIME want to 'keep businesses here' by preventing any tax breaks on foreign stationed businesses, he is killing business from both ends. If he wants businesses to remain, you have to keep takes lower so that businesses can remain competitive.

[HowardRoark]

And another thing......my Dad always told me when I was a kid that life wasn't fair. I think maybe we need someone like him running for President. No trophies for everyone. Put a video on you-tube.....who cares, doesn't make you Steven frickin Spielberg. Life ain't fair.

[MadScientist]

And another thing......my Dad always told me when I was a kid that life wasn't fair. I think maybe we need someone like him running for President. No trophies for everyone. Put a video on you-tube.....who cares, doesn't make you Steven frickin Spielberg. Life ain't fair.

So stop bitching about the taxes being raised on the rich.

[MadScientist]

By putting your blinders on and looking at this only as a fairness for the rich issue, you are seriously missing the big picture.

Funny, that's exactly what I believe too, only the opposite of how you do. Obama never brings up economics, only "fairness." I see it not as a fair issue at all. I see it as a system that will raise all ships. I think the guy who makes $2 million a year, but employs 60 people is more important than that same guy paying a "fair" amount of taxes that keeps half those 60 out of work, but giving them somekind of bogus tax credit.

BTW, prosperity is right around the corner.........

The counter argument is that when that guy pays the 'fair' amount of taxes that you deride, there is more money being spent by consumers, so there is enough demand for the guy to employ 90 people. So the guy still makes as much, if not more than before, but more people are working. Getting money in the hands of consumers is a more effective way to raise all ships.

[MadScientist]

Do you really think there is that much difference in motivation for a person who pulls in $1 million weather he keeps $64000 or $50000 of his next $10000. I flat out dispute your assumptions with the rates we are talking about.

Seems to me a problem often is that Libs aren't very good at math.

incentive to work longer hours at diminished returns is only a part of the issue. Taxation on productivity, and it's effects is a huge issue. In crease taxes on businesses and you change the ball game. Businesses will look to save money by 1) cutting jobs, 2) Increasing prices, 3) moving business to areas with lower taxes. This is what businesses do. Why? Because they are trying to stay competitive. Som when Obama says he wants higher taxes on businesses (and doesn't even understand the Laffer curve - and when told how it works STILL wants to tax higher 'because it's fair') AND AT THE SAME TIME want to 'keep businesses here' by preventing any tax breaks on foreign stationed businesses, he is killing business from both ends. If he wants businesses to remain, you have to keep takes lower so that businesses can remain competitive.

If you are going to comment on a typo, you shouldn't make them yourself.

If the tax situation (loopholes closed) is changed so there is no advantage to moving, then it doesn't matter if taxes are raised because the companies won't move. As for the options for keeping profits up, you missed the option of increasing sales. By focusing on increasing consumption, profits can be maintained or increased, even with a tax increase.

[texaspackerbacker]

The flaw in what you say, MadScientist, is that the great majority of these top earners are NOT retired fat cats or spoiled trust fund brats or whatever bogus image of the rich you are trying to palm off. Rather, most of them are small business owners--entrepreneurs who generally will NOT slow down the velocity of money as you describe, but maximize that velocity by investing in their own business--increases in employees, equipment, and inventory. THAT is what the socialist, Obama either SEEKS to disrupt or ignorantly would disrupt as a consequence of his programs and policies.

If they are investing in their business, then it is a business expense that isn't taxed. The tax is on net, not gross, so your argument is totally invalid, as usual.

I've come to have a bit of respect for your ability to reason, MS--even leftist that you are. But this isn't even close to your usual standard.

As you said yourself, it's all about "velocity of money"--and my old favorite, the Keynesian Multiplier. The pittance of tax savings is irrelevant compared to the beneficial effect of the investing in the form of job creation, geometrically greater total income for many individuals, secondary, tertiary, etc. consumption, investment, etc.

[Tyrone Bigguns]

Som when Obama says he wants higher taxes on businesses (and doesn't even understand the Laffer curve - and when told how it works STILL wants to tax higher 'because it's fair') AND AT THE SAME TIME want to 'keep businesses here' by preventing any tax breaks on foreign stationed businesses, he is killing business from both ends. If he wants businesses to remain, you have to keep takes lower so that businesses can remain competitive.

I love how you present the laffer curve as if it is gravity. There are plenty of economists that deride and ridicule it. The U.S. treasury put out their study showing that government revenue decreased because of Kemp/roth tax cut.

The CBO put out a study as well that casts severe doubt on the benefits of a tax cut.

Of course, the laffer will have its supporters. I'm not advocating one way or the other...but, please, stop with presenting it as sound economics that everyone should buy into.

As for Tyrone, i find it troubling you would use a concept invented by a muslim. America doesn't need any of that type of stuff.

[mraynrand]

Do you really think there is that much difference in motivation for a person who pulls in $1 million weather he keeps $64000 or $50000 of his next $10000. I flat out dispute your assumptions with the rates we are talking about.

Seems to me a problem often is that Libs aren't very good at math.

incentive to work longer hours at diminished returns is only a part of the issue. Taxation on productivity, and it's effects is a huge issue. In crease taxes on businesses and you change the ball game. Businesses will look to save money by 1) cutting jobs, 2) Increasing prices, 3) moving business to areas with lower taxes. This is what businesses do. Why? Because they are trying to stay competitive. Som when Obama says he wants higher taxes on businesses (and doesn't even understand the Laffer curve - and when told how it works STILL wants to tax higher 'because it's fair') AND AT THE SAME TIME want to 'keep businesses here' by preventing any tax breaks on foreign stationed businesses, he is killing business from both ends. If he wants businesses to remain, you have to keep takes lower so that businesses can remain competitive.

If you are going to comment on a typo, you shouldn't make them yourself.

If the tax situation (loopholes closed) is changed so there is no advantage to moving, then it doesn't matter if taxes are raised because the companies won't move. As for the options for keeping profits up, you missed the option of increasing sales. By focusing on increasing consumption, profits can be maintained or increased, even with a tax increase.

Companies will move if it more advantageous to move. Fine, close the loopholes. They will still move if it's cheaper to make shit overseas because of high taxes. Just like businesses flee states with punishing tax structures and oppressive unions, like Ohio and Michigan.
Sales always increase when you have to raise prices due to increased taxes. Right.