Please explain the justification for the Bush tax cuts

reply to post by Curiousisall


Tax cuts to the wealthy doesn't even create jobs...what boss do you know uses his personal money to invest in the business? Maybe in stock to make himself richer but that's it. The ideology is the rich pay for campaign funds which gives them power over laws which in turns give them power over taxation. The sad part is these greedy people are complaining about Obama planning on not renewing it...if I make half a million a year what does relinquishing the tax cut do to me? nothing! maybe not being able to take a vacation or two...but after bills I'd still be filthy rich America is ran by greed.

Originally posted by OldDragger
reply to post by camaro68ss

 

The tax cuts to be renewed don't have to be for everyone.
The rich make more, they should pay more.
Wasn't the average refund on the order of $200.00? I'm pretty sure that's what I got and I',m in the 33%
rate. That didn't make any difference to me, though I guess the idea is the aggregate amount.
Why are people against taxes on principle? Of course it takes MORE money today than in 1796!
The founders rebelled against taxation without representation! Not taxes in general.
Sure I'd like to have more money, but I also believe in supporting my country, to the benefiet of all of it's citizens!

The rich already do pay more. Both in aggregate, and in percentage. All it takes is a quick look at the tax tables to see that.

I'm not 'against taxes'. My father worked in highway construction for a few decades...I know how much infrastructure costs, and I understand that government employees want to be paid.

I *am* against raising taxes in the middle of a recession / depression. It's bad economic policy, regardless of your ideological stripe. I'm also firmly convinced that the government has grown far too large, and that we've become far too beholden to it...which makes me very skeptical / cynical about giving it more of my (or anyone's) money.

Here is an analogy to demonstrate how our tax system works:

Once upon a time, ten men go out for beer every day and the bar tab comes to $100. If these men paid their bill the way Americans pay their taxes, it would go something like this:

The first four men (the poorest) pay nothing at all.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.

And that's the way they decided to do it, each and every day. The ten men drank a beer in the same bar after work each day, and they were all quite happy with this arrangement. That is, until one day the owner of the bar decided to be nice to them. He said: "‘since you are all such good customers, I’m going to reduce the cost of your daily beer by $20. Drinks for the ten now cost just $80". Good news!

The buddies still wanted to pay their bill the same way and so the first four men were not affected. They would still drink for free. But what about the other six men – the paying customers? How could they divide the $20 windfall so that everyone would get his ‘fair share?’ They realized that $20 divided by six is $3.33. But if they subtracted that from everybody’s share, then the fifth man and the sixth man would each actually end up being paid to drink his beer! So, the bar owner suggested that it would be fair to reduce each man’s bill by roughly the same amount, and he proceeded to work out the amounts each should pay. Which was:

The fifth man, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33%savings).
The seventh now pay $5 instead of $7 (28%savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare their savings.

The sixth man said "Hey, I only got a dollar out of the $20, but the tenth guy got $10!"

The fifth man said "Hey, that’s right! I only saved a dollar, too. It’s not fair that he got ten times more than I did!"

The seventh man shouted "That’s true! Why should he get $10 back when I got only two? The rich people get all the breaks!"

"Wait a minute" yelled the first four men in unison. "We didn’t get shinola! The system exploits the poor!"

The nine men then surrounded the tenth and beat him up.

The next night the tenth man didn’t show up for drinks, fearing for his safety, so the other nine men drank beers without him. But when it came time to pay the bill, they discovered something important. They didn’t have enough money between all of them for even half of the bill!

And that, my friends, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. However, tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.

Hope you enjoyed that. I'm not sure who wrote this, but I've had it on my PC for a while......

P

The people who pay the highest taxes get the most benefit from a tax reduction. However, tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.
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They are allready doing that, despite the tax decreases! Think outsourcing and registering in Dubai.
The thing with corporate America is no amount of profit is ever enough for them! They feel no resonsibility to our nation, only to their bottom line.
Furthermore, it's doubtful that corporations would just bail on the worlds largest economy and never do business with America.

reply to post by Zanti Misfit


trickle down economics actually involves tax cuts and incentives for businesses with the idea that this will trickle down into the population in the form of lower prices for goods sold to the public, as well as more jobs being made available to the public.

Trickle down, guys! It's like when a homeless man on the street asks for some change and you trickle down a few cents. The idea is, the more you get paid, the more likely you'll be able to trickle down a few extra pennies.

Really solid economics, not greed based or anything!

Originally posted by OmiOra
reply to post by Curiousisall

 

Tax cuts to the wealthy doesn't even create jobs...what boss do you know uses his personal money to invest in the business? Maybe in stock to make himself richer but that's it.

Actually, I've known, and worked for, several bosses who did, indeed, use their personal money to directly invest into their business. Most small businesses work on exactly that model.

In the spirit of denying ignorance...you might be interested in knowing that selling stock isn't just a way to make stockholders wealthy...that's actually a side effect. A company's primary purpose for selling stock is to raise operating cash...so while 'the boss' may buy the stock to get rich from it (presumably through either dividends, or through resale), by doing so, he is, in fact, using 'his personal money' to invest in *a* business, even if it's not *his* business.

The ideology is the rich pay for campaign funds which gives them power over laws which in turns give them power over taxation. The sad part is these greedy people are complaining about Obama planning on not renewing it...if I make half a million a year what does relinquishing the tax cut do to me? nothing! maybe not being able to take a vacation or two...but after bills I'd still be filthy rich America is ran by greed.

You should read more of Robert Heinlein. Of course America is motivated by greed. So is France, China, and every Republic of Unpronouncablestan on planet Earth. Greed is one of the great motivators for the human race. To quote The Master Himself, "Never appeal to a man's "better nature." He may not have one. Invoking his self-interest gives you more leverage.". Oh...you were expecting a Biblical quote or something?

reply to post by OldDragger


it sounds like your in the same brackets as me. That return your talking about is for the end of the year. you paid $200 to much in taxes and you got it back. with the new tax incress you will see $175 less a month! $2,100 less a year! Thats a new TV

People know better how to spend their money than government bureaucrats. That is the simple answer. When people are not punished for being productive it helps the economy. People that think otherwise are just wrong and the proof is right here, today, and in your face. The current dominant economic philosophy - Keynesianism, post Milton Friedman Fascist-Neoliberalism - has failed disastrously and will eventually stop the market from functioning altogether.
The bigger issue is what we can do to reduce spending in government. How about lowering taxes across the board?
How? Stop the war. We can save trillions of dollars by reducing our global empire and ending war. Stop trying to find "fair" ways of increasing taxes and start looking for ways to reduce the size of government.

Its pretty simple actually . When the government takes anyone's money it instantly dissaperes into a black hole of stupidity. When it does not , people have more to spend . When people have more to spend the economy flourishes and in the end since more people are working more hours the net taxes the government takes in goes up.

reply to post by camaro68ss


What is being proposed and fought by the right is that taxes for those making more than $250,000 a year be expired, not for everyone, I think people overlook this point when they argue against it.

Originally posted by frimilden
reply to post by camaro68ss

 

What is being proposed and fought by the right is that taxes for those making more than $250,000 a year be expired, not for everyone, I think people overlook this point when they argue against it.

I understand this but why do you want to tax the rich more? they are the ones that spend the most and feed this economy the most? why not just cut goverment more?

Its always lets tax more! never lets spend less!

the Bush tax-cuts and the extension of those cuts are based on the idea that the tax rates and unfair taxes like the Estate Tax needed overhauled in the first place,

the 10% capital gains and lower stock dividend tax helps the many who have IRAs,
(not so much for the people that let the fund managers do their investment homework for them)


today, the Bush Tax cuts should remain in effect, for the same reason ; it makes the tax rates more in line with
the economy.

although President Øbama seems to have the liquidation of the 'middle class' one of his 'CHANGE' promises
and higher taxes, and more fees, assays, and tolls are on the way to being enacted under his socialist
Øbama-care, and his soon to appear 'Austerity' programs styled after the Greek/Spanish policies being rolled out

Originally posted by St Udio

the 10% capital gains and lower stock dividend tax helps the many who have IRAs,
(not so much for the people that let the fund managers do their investment homework for them)

not true. IRA's are not taxed until the money is withdrawn and, at that time, the individual pays ordinary income tax rates, not long term gains rates.

reply to post by camaro68ss


I completely agree with you that government should be cut, it is to big. But lets face it, that will not happen, neither right nor left will cut it, they all love their pet projects and pork more than they let on.

My problem with them not expiring the cuts for the rich is that the money will not Trickle down as they like to justify it bye. It will be invested overseas or sit in a high yield account for years and years, it will not help this country out. I am firm believer that cutting taxes on the CEOs and Wall Street movers whose actions have sliced jobs and wages and nearly destroyed the American economy is not something that should be done in the middle of a depression.

They spend a much smaller portion of their money then say the middle or upper middle class does. That means continuing the cuts will not stimulate the economy or create any jobs. However one of things it will do is blow a hole in the budget of over $35 billion this year and $700 billion in the next 10 years. Where will the money come from then? China. We will end up borrowing more and sinking our selves into much more debt and be beholden to a foreign country more than we already are. The rich would get a giant $31 billion just next year alone, and that money will most assuredly end up overseas in bank accounts not trickling down.

Originally posted by Curiousisall
Please explain the justification for the Bush tax cuts

No 'justification' required. You earn it .. you keep it.
No one has a right to steal your hard earned money simply because they want it.
FAIRNESS is just that simple.

First I do not understand the concept of giving the rich more money will create jobs.

You aren't 'GIVING' the rich more money. That's just wrong.
They are 'KEEPING' the money they have earned. It's just that simple.

How does taxing the rich de-incentivise them to become rich?

Read Atlas Shrugged.
Why should I work hard if looters are just going to come along and steal what I produced?
I'm not going to reward their bad behavior by making more for them to steal.

Originally posted by Crakeur
reply to post by Zanti Misfit

 

trickle down economics actually involves tax cuts and incentives for businesses with the idea that this will trickle down into the population in the form of lower prices for goods sold to the public, as well as more jobs being made available to the public.

Excatty right . And remember consumption = production . heheheh Its now clear where the brains behind ATS lies lol

reply to post by frimilden


Why is that money in over seas banks? because they get taxed to hell and they get to keep more of it there. why do they move jobs overseas? because they get taxed to hell here and make more money over there. Rich people dont sit on there money. sitting on money doesnt make you more rich. you say the rich are greedy? they need to spend money opening up new buildings and branches to make money. that makes more jobs. my family owns a company and thats all my dad wants to do is reinvest his money to grow the company and make more money. if he gets these taxes raised thats going to slow down that process

reply to post by Curiousisall


To understand the rationale of the tax cuts for the "rich" you have to understand who the rich are in terms of tax law.

The vast majority of the rich are not folks like Paris Hilton or some dude running a hedge fund. The vast majority of the rich are small business owners. The gent with the plumbing supply store, running a painting company a family that has a couple of bakerys. They make more than $250/year and as a consequence are considered "rich" by current tax law.

When you raise taxes on those folks, it has a direct impact on employment. The painting guy is far less likely to hire more painters, putting on a new crew. He is less likely to give his existing staff a raise and is less likely to investment in better/new equipment, keeping cash flowing to the providers of those goods and services.

Folks like to bandy about all of this talk about the rich, when in fact some guy who runs his own store and brings in $300K/year is not rich. He needs to invest in his business, he needs to save should something happen to his facilities. On paper he's rich.

If the government wanted to classify the rich differently, say folks who make over a certain amount in investment income, that would be different and a bit less troublesome than simply taking net income and lumping Joe the plumber into the same bucket as Gordon Gecko.

The challenge of course is that there are very few Gordon Geckos and they have the ability to hide their money and put it into investment vehicles with minimal tax implications. You want to see how to do that, chat with a few of the great champions of the working man, any Kennedy, John Kerrry or Herb Kohl. You'll find that their overall marginal tax rate is in the 20% range, yet they are the same gents who want to raise Joe the Plumber's rate. Joe will never get his marginal rate down because it will take a lot or a very long time for the vast majority of his income to come in the form of investment income taxed at capital gains rates. Because there are few Geckos and the need of the government to tax and spend is so great, the definition of "rich" continues to drop to place more folks in the top bracket.

The only solution to the tax issue is to eliminate the income tax and move to a flat consumption tax with deductions eliminated. Spend more, pay more

Originally posted by frimilden
They spend a much smaller portion of their money then say the middle or upper middle class does. That means continuing the cuts will not stimulate the economy or create any jobs.

How much they spend and if it stimulates the economy or not is irrelevant.
It's THEIR money. They have a right to keep what they earn.
No one has a right to steal it from them.
That's just turning them into slaves of the state.

Work hard citizen. Work for the gov't.
Work citizen and don't mind that red boot at the back of your neck.