It is a two way street however the taxing the rich lack of effectivness is cut and dry, the safety net is the biggest clusterfuck, huge waste of money that has become a hammock more than a net.
Yet they continue to make the tax issue the biggest issue even though the safety net is strangling the people paying for it.
No it’s not, and I’m really getting sick of having to repeat myself. Higher taxes on the rich have gone hand in hand with the greatest periods of economic growth in U.S. history.
I’m not denying some parts of the safety net probably need to be reworked, but broad safety net is necessary for a booming economy, that’s also a historical fact. You help people get back on their feet so they can eventually re-enter the workforce and contribute to the overall economic growth of the nation, this isn’t rocket science. I mean shit, fiscal conservatives always love to cite Reagan as the godfather of this ideology, but they either don’t know, or simply don’t like to talk about the fact that he slashed taxes and had a huge deficit when he left office. In fact, show me one instance where lower taxes and a reduced net at the federal level has actually lead to economic growth, I’d love to see it.
Going hand in hand is not cause and effect. Taxes started in 1913 and the Great Depression started after that so I guess I can say taxes went hand in hand with the depression.(?)
And for your request; anytime before 1913. There wasn’t growth every year but was that because the rich weren’t taxed enough?
You seem fairly intelligent I can’t believe you think that taking money from people is what drives an economy.
The marginal tax rate for the highest earners in the U.S. was cut from 73% in 1921, to 25% by 1925.
“The top marginal tax rate was cut from 73% to 58% in 1922, 50% in 1923, 46% in 1924, 25% in 1925, and 24% in 1929.”
Source: Andrew Mellon - Wikipedia
Lower taxes worked then because people had to spend money in the area directly around them, which put the money back into the economy. People don’t have to do that anymore, and many don’t.
It’s not just taking money from them, if you don’t spend it in the right places then yeah, it’s wasted money. But taxes are lower than they’ve been in the past 80 years, noone is saying lets take every penny that the rich earn. But that we should bring the tax levels up to their historical norms, what has been proven to actually work.
“if you don’t spend it in the right places then yeah”
That is what kills it for me. Call me crazy(everyone else does) I do not trust the overwhelming majority of the current people in DC. It is not just that I don’t trust their soul, I don’t trust their brains either. If they truly cared about the people and had the brains to help, we would not be in this mess. It just goes against my gut… and brain.
I’m right there with you, I don’t trust them either. That’s why I get into these arguments a lot. If people were more educated about this stuff (not talking about anyone here, despite our differences in opinion, at least you guys pay attention to the stuff. so many people in my generation just don’t care about politics and don’t stay informed, then wonder why we have the shittiest representatives ever) then we might be able to develop a culture where the most sound and qualified candidates are actually able to get elected, not the one with the biggest budget who can talk the most shit about their opponent in commercials.
The thing about the economic situation is that slashing spending is just going to make the economy stagnate(and this is a shitty analogy, but it’s the closest one I’ve come up with that accurately explains our situation). A depressed economy is like a car with a dead battery, you can try and rip seats out and other shit to make it lighter and easier to pull, but until you jump the battery (economic stimulus) that thing isn’t going anywhere. Again, not a perfect analogy but it’s the best one I’ve found.
I hate to say it but the rich will find ways around the tax hikes anyways. They need to be careful how much they raise them as well. Many wealthy people have been leaving their home countries in Europe because the tax rates are so high I could see that start happening here. Also what stops the ultra rich from retiring tomorrow so they no longer collect a salary and just avoid paying taxes. Regardless taxes need to go up across the board.
I disagree with more economic stimulus. I say let the system fail so we feel the pain and learn from our mistakes instead of repeating them.
Ditto, but that would cause the wealthy folks pain and they aren’t having it. They would rather directly give politicians money for guaranteed returns than to pay taxes and hope for the best. It’s smart on one level but can only go on for so long before society implodes under the pressure they are placing on the majority.
If they really cared about raising taxes on the rich they’d ditch the capital gains 15% BS. I say if you make over $250k a year, income is income. Tax it all at the same rate.
I’m surprised to hear a fellow trader say that. Or are you just saying if they were really after increasing tax revenues that’s what they could do?
my wife and i had a long conversation about getting an employee or 2 next year to support our business ventures. we realized what we paid in all taxes last year would easily pay 2 people a pretty nice wage for doing secretarial type work. That figure represents all our taxes and obviously I’m not advocating no taxes but a swing of 5% could represent a decent amount of money. I highly doubt we will bring on 2 people next year as this would be our first employee…but I can be certain if the rates jump up in combination with new health insurance legislation taxes and changes to capital gains there is no way we would be comfortable taking on the responsibility of another person.
Some democratic senators are looking to drop the medical device tax out of law and thus pull funding out of the supposedly paid for healthcare law…where will that funding be made up? They will go back to the “rich” well. I wouldn’t have as big a problem with taxes if I at least knew there was some reasonable limit in sight.
Is anyone actually worried about the “fiscal cliff”? Are funds being moved from one place to another? Or are you guys just keeping stil?
I am just fed up with the wealthy paying lower tax rates than I do since they don’t work for their money, while the hole in the federal budget gets bigger and bigger every year since the Bush tax cuts. The guy who gets raped in this country on taxes the worst is the guy making $250k a year with no wealth or investments, say a doctor with a shitload of student loans. He is paying 40+% whereas the billionaire who hasn’t worked a day in his life makes money off his money, and pays little or no taxes depending on his investment structure. The main counter-argument is that it’s double taxation for those who save their income and invest it and then get taxed off the proceeds, which is why I’d put the 250k a year filter on it.
The fiscal cliff will be settled after the first of the year. It’s typical political BS preventing them from signing a deal now. Any deal signed now would be a tax INCREASE, and whoever signs it is worried about getting hammered with shady ads a year and a half from now about how they signed a multi-billion dollar tax increase. If we wait til the first, taxes go automatically up for everyone, and then any deal signed is a tax CUT, which they can make their own BS ads promoting being in favor of.
It’s sad that the permanent campaign trumps actually governing, even just after an election and with matters this serious, but such is the state of affairs since Citizens United.
That said, I’ve been doing hit and runs on TVIX to take advantage of said clusterfuck. Basically an ETF that tracks volatility in the market. I’ve gotten in and out +10% twice now.
VIX has been riding fairly low, bonds have been flat for almost a year…I’m anxiously watching to see if the bond bubble pops. Money to be made shorting there perhaps, or long wherever the bond profits end up eventually.
As for the wealthy…if they were creating good jobs HERE I’d be all for cutting their taxes or not even taxing them. The economy can’t stay flat forever and IMO when that QE money begins to cycle the poor & middle class (probably even upper middle) aren’t poised to handle the inflation.
Inflation traditionally helps the poor and lower middle class because it devalues wealth and debt and levels the playing field a bit. If you know inflation is coming you might as well run up the credit card instead of building your savings because money now is worth more than money later. That said, the system is rigged so that the super rich never lose…inflation will also send securities through the roof so they win too.
IMO that “inflation traditionally” comment is anecdotal, while it sounds nice it may reflect a horribly flawed American ideology. If the diluted currency (attempted inflation) fails to reach the lower classes because the wealthy are investing this money for paper gains (or in jobs overseas), how would dilution then make paying down debt easier for the average stiff? Inflation (especially post NAFTA) does not spread evenly and historically inflation has proven in the long haul to act as a regressive penalty against the very people that cannot afford it.
Inflation reduces the spending power of paper, while increasing the price of assets. This is why some say inflation is regressive, it punishes low wage workers, people who can’t afford assets. Deflation on the other hand reduces the price of assets, while increasing the spending power of paper. This actually would empower the low wage workers and punish the wealthy that own assets…eventually.
I know it’s more complicated than that, the above is surely an oversimplification. I understand in deflation there initially is massive job loss and a painful delay before any positive results show themselves. There is also a delay with inflationary policy, we’re seeing that right now with a relatively flat economy despite MASSIVE injections of fresh money. You could school me on the pitfalls of deflation in terms of foreign trade I’m sure, I would gladly welcome that interaction. 
One concern I have, what if a foreign country were to dump their USD on our goods (assuming we still make any 
) and flood the economy with our own currency. The lower-middle class are just not capable of handling that inflation, wages have been flat at best for decades for most of our population.
Inflation is also the invisible tax. If you paid $8 sales tax for a $100 widget and now that widget costs $200 because of inflation you are now paying $16 in tax. What a great way to increase tax revenue! Same widget but twice the revenue. Brilliant!
It’s tricky. On one hand real assets get more expensive, but on the other hand real debts get cheaper. The guy who really wins with inflation is the guy who owns a shitload of property, mortgaged out the ass.
What I’m saying though is that without a widespread wage increase debt only becomes cheaper for some. Inflation will always produce short term winners & losers, this has much to do with timing and remaining solvent. Not to be overlooked, inflation also tends to push a currency closer to or beyond its anticipated intrinsic value. One thing we agree 100% on is that bank leveraged income properties are likely to be king! I need to get in on some of that action soon!
Looks like they’ve come together on an 11th hour deal to avoid the fiscal ciliff: