Re: Is Bush the worst president ever? [1/2]
Listen, I'm not anti/pro-whatever President. But the basic concepts of microeconomics and income taxes as well as macroeconomics and budgets aren't very difficult -- especially not in a progressive income tax system wtih capital gains.
The only "distribution of wealth" tax is the inheritance tax. In some legal texts, its an illegal tax. But it remains because -- and at 55% -- because people don't like the offspring of wealthy people to get their money.
BTW, you should read up on the investment tax laws of the UK. They are far more pro-wealth than the US, and benefit the "rich-wealthy" far more. You can lose money and you get credits against future capital gains -- or outright lack of any capital liability from a tax standpoint -- after 3 years.
Furthermore, you should research who is paying what taxes from 1970-2000. It's proportional. The more you raise taxes "on the rich," the less people who are trying to acquire wealth (the income earners) can't.
First off, those with wealth do not pay income tax. And if capital gains taxes are high enough, it's better for them not to invest.
So, secondly, when you take incentive for investments away, you get less jobs.
Worst than that, these so called "rich" taxes against the "evil people" are actually levied just as equally against the middle to upper income earners. Every discretionary dollar you tax that they could have invested is now one less dollar that not only don't create a job, but doesn't allow them to acquire wealth.
If you don't have wealth you must have income to acquire wealth, and increased income taxes only take away from that discretionary income to acquire wealth. Which is why as the taxes go up and more and more is shared by the income earners, only those with existing wealth actually get to keep their money.
The fact that the overwhelming majority of people can't even separate income from wealth when it comes to taxes makes me want to ram my head into a wall and put me out of my misery!
Furthermore, that's just the microeconomics of it.
Macroecomonically, even the wealthy actually don't have "more money" -- they have "more money" as a "percentage" in circulation. The amount of "money" in circulation is fluid. The more you tax, the less it multiplies, the less there is. As I said, this is nothing new and has been talked about since Alexander Hamilton. There is a balance in aggregate taxation where the circulation and multiplier is ideal -- beyond that, you actually get less.
JFK (a Democrat), Reagan and W. have all proven that we are beyond that point of diminishing returns. Increased income taxes actually reduce circulation, overall wealth available (let alone the chance of those who don't have it from acquiring it) and reduce the federal revenue in collected taxes. It's a lose-lose-lose situation, but people keep voting for it because they think there is this magical concept that the higher the income tax, the more money the federal has.
Raising income taxes gives you maybe 2-3 years of increased revenue from existing circulation, then a major drop as the circulation is constrained. Lowering income taxes literally takes 2-3 years before the circulation is increased once again. As I said before, I'm surprised that federal revenue has come back up this quickly after the tax cuts -- although there were some made before 2003 as well, but not nearly as much.
People keep asserting that is impossible, "you can't have it both ways," but that's based on the assumption that money is finite and by rasing tax percentage the federal revenue will increase. People don't realize that unless you have a pure socialist economy with no currency, the private sector defines 100% of the value and circulation of money.
Progressive Tax in Microeconomics 101 Example:
Income tax brackets are 20% on $10-20 and 40% on $20+.
It costs $20/day to live.
Someone who makes $30/day brings home $24.00 minus $20 and has $4.00 of discretionary income.
Someone who makes $60/day brings home $42.00 minus $20 and has $22.00 of discretionary income.
There is about 25% re-investment (yes, this is over-simplified, but far more complex than "there is a finite amount of money and raising income taxes always increases federal revenue and penalizes the rich").
I now raise the income tax to 50% on $20+.
Now the $30/day person brings home $23.00 and has $3.00 of discretionary income, $1.00 less than before.
The $60/day person brings home $38.00 and has $18.00 of discretionary income, $4.00 less than before.
Re-investment drops below 20%.
I now lower the income tax to 30% on $20+.
The $30/day person brings home $25.00 and has $5.00 of discretionary income, another $2.00 more than the last increase.
The $60/day person brings home $46.00 and has $26.00 of discretionary, another $8.00 more than the last increase.
Re-investment is over 30%.
What's all this mean?
1) I've now just given the "rich (income earner)" 4x the tax break than the "middle class." If I give it on the $10-20 bracket, the "rich" still get the exact same as the middle class (both currently pay $2.00 of the $10-20).
2) Who can afford to give up more? Well, that's not really the question ...
3) The real question is how many new jobs to I kill? Whether we're talking 50 $30/day earners or just 1 $60/day earner, both of them invest most of their discretionary income. That's new jobs no longer being creates in both cases.
Which is also a simple statement many people make.
Listen, I'm not anti/pro-whatever President. But the basic concepts of microeconomics and income taxes as well as macroeconomics and budgets aren't very difficult -- especially not in a progressive income tax system wtih capital gains.
Sigh, you keep over-simplying things into nothing of what I said. Companies pay tax on what expenditures they don't make, so it makes sense to keep recycling net profit beyond revenue minus operating costs into additional operating costs -- typically private sector positions. But they don't come back right away.
The US has constantly been losing jobs in a global economy. Adding to the fact is that being good in math and science is wholly unaccepted in generation X and, even more so, Y. We are graduating few and fewer engineers (not technologists, major difference) each year and the immigrants have also gone down.
Income tax cuts don't work like some people expect them to because they don't realize we have a progressive income tax system. That means someone who makes more than you always gets at least as much of a tax cut as you do.
Yes, because we keep taxing private sector discretionary income more and more to the point there is none. That means wealth cannot change hands -- those who have it have it, those who do not do not. You will never distribute wealth with incresed income taxes. And you can't take money away from people who just sit on their wealth, because they aren't doing anything with it -- not income, gains or otherwise.
The only "distribution of wealth" tax is the inheritance tax. In some legal texts, its an illegal tax. But it remains because -- and at 55% -- because people don't like the offspring of wealthy people to get their money.
BTW, you should read up on the investment tax laws of the UK. They are far more pro-wealth than the US, and benefit the "rich-wealthy" far more. You can lose money and you get credits against future capital gains -- or outright lack of any capital liability from a tax standpoint -- after 3 years.
I never said that was inflation -- that's why I don't bother with these discussions, people mis-quote me out of context of where I used a term.
Furthermore, you should research who is paying what taxes from 1970-2000. It's proportional. The more you raise taxes "on the rich," the less people who are trying to acquire wealth (the income earners) can't.
Healthcare, yes., but that's another story. Houses is debatable, as the market is currently inflated and was fairly stagnant until recently.
Ah ha! Now you get to it!
First off, those with wealth do not pay income tax. And if capital gains taxes are high enough, it's better for them not to invest.
So, secondly, when you take incentive for investments away, you get less jobs.
Worst than that, these so called "rich" taxes against the "evil people" are actually levied just as equally against the middle to upper income earners. Every discretionary dollar you tax that they could have invested is now one less dollar that not only don't create a job, but doesn't allow them to acquire wealth.
If you don't have wealth you must have income to acquire wealth, and increased income taxes only take away from that discretionary income to acquire wealth. Which is why as the taxes go up and more and more is shared by the income earners, only those with existing wealth actually get to keep their money.
The fact that the overwhelming majority of people can't even separate income from wealth when it comes to taxes makes me want to ram my head into a wall and put me out of my misery!
Furthermore, that's just the microeconomics of it.
Macroecomonically, even the wealthy actually don't have "more money" -- they have "more money" as a "percentage" in circulation. The amount of "money" in circulation is fluid. The more you tax, the less it multiplies, the less there is. As I said, this is nothing new and has been talked about since Alexander Hamilton. There is a balance in aggregate taxation where the circulation and multiplier is ideal -- beyond that, you actually get less.
JFK (a Democrat), Reagan and W. have all proven that we are beyond that point of diminishing returns. Increased income taxes actually reduce circulation, overall wealth available (let alone the chance of those who don't have it from acquiring it) and reduce the federal revenue in collected taxes. It's a lose-lose-lose situation, but people keep voting for it because they think there is this magical concept that the higher the income tax, the more money the federal has.
Raising income taxes gives you maybe 2-3 years of increased revenue from existing circulation, then a major drop as the circulation is constrained. Lowering income taxes literally takes 2-3 years before the circulation is increased once again. As I said before, I'm surprised that federal revenue has come back up this quickly after the tax cuts -- although there were some made before 2003 as well, but not nearly as much.
It's not "both ways," it's simple concepts of microeconomics and discretonary income along with the reality of macroeconomics and what the money multiplier does on aggregate circulation. Yes, you lower income taxes and you get increase multiplier, circulation and ... tada ... federal tax dollars actually collected!
People keep asserting that is impossible, "you can't have it both ways," but that's based on the assumption that money is finite and by rasing tax percentage the federal revenue will increase. People don't realize that unless you have a pure socialist economy with no currency, the private sector defines 100% of the value and circulation of money.
They have less total, yes. But they have more, percentage-wise.
Progressive Tax in Microeconomics 101 Example:
Income tax brackets are 20% on $10-20 and 40% on $20+.
It costs $20/day to live.
Someone who makes $30/day brings home $24.00 minus $20 and has $4.00 of discretionary income.
Someone who makes $60/day brings home $42.00 minus $20 and has $22.00 of discretionary income.
There is about 25% re-investment (yes, this is over-simplified, but far more complex than "there is a finite amount of money and raising income taxes always increases federal revenue and penalizes the rich").
I now raise the income tax to 50% on $20+.
Now the $30/day person brings home $23.00 and has $3.00 of discretionary income, $1.00 less than before.
The $60/day person brings home $38.00 and has $18.00 of discretionary income, $4.00 less than before.
Re-investment drops below 20%.
I now lower the income tax to 30% on $20+.
The $30/day person brings home $25.00 and has $5.00 of discretionary income, another $2.00 more than the last increase.
The $60/day person brings home $46.00 and has $26.00 of discretionary, another $8.00 more than the last increase.
Re-investment is over 30%.
What's all this mean?
1) I've now just given the "rich (income earner)" 4x the tax break than the "middle class." If I give it on the $10-20 bracket, the "rich" still get the exact same as the middle class (both currently pay $2.00 of the $10-20).
2) Who can afford to give up more? Well, that's not really the question ...
3) The real question is how many new jobs to I kill? Whether we're talking 50 $30/day earners or just 1 $60/day earner, both of them invest most of their discretionary income. That's new jobs no longer being creates in both cases.
