Tax Cuts, Real and Imaginary: Obama's spending programs in disguise.

[Silver]

http://www.theweeklystandard.com/Content/Public/Articles/000/000/015/533kqlep.asp

"Thirty years of Republican tax policy have now completely eliminated federal income taxes on the poor and lower middle-income Americans, and almost eliminated them on middle America.

The latest data from the Congressional Budget Office and the Internal Revenue Service show that the lowest 40 percent of income earners as a group actually receive net payments from the federal income tax system. (They get 3.8 percent of total federal income tax revenues instead of paying any income taxes.) The middle 20 percent of income earners pay 4.4 percent of federal income taxes. Thus the bottom 60 percent of income earners together, on net, pay less than 1 percent of all federal income taxes. (These workers earn 26 percent of national income.)

The data show that the top 1 percent of income earners now pay 40 percent of all federal income taxes, which is almost double their share of the national income. The top 10 percent pay 71 percent of federal income taxes, though they earn just 39 percent of the nation's pretax income.

This is a result of the across the board income tax rate cuts adopted by Ronald Reagan and the current President Bush, plus the Earned Income Tax Credit first proposed by Reagan in the 1970s, and the child tax credit enacted into law as part of the 1994 Contract With America.

Barack Obama claims to be proposing income tax cuts for low and moderate income and middle class workers, but Reagan Republicans have already eliminated most of their income tax liability. What Obama is calling tax cuts for the middle class is really a slew of refundable federal income tax credits that would primarily go to those who are paying little or no federal income taxes now. Such credits would primarily not reduce tax liability, but instead be checks from the federal government for child care, education, housing, retirement, health care, even outright giveaways. These are not tax cuts. They are new federal spending programs hidden in the tax code."

[Oakbone]

Robin Hood would be proud

[Elad]

Well, you're in law, you drive a fancy car, you post it on the boards, you live in NY...you make money..deal with it? You're more fortunate than others. I don't support the bums trying to climb up without trying, but I feel a lot more for the mother of two working a couple of jobs than I do wondering if it's going to dent your six-figures

/rant off

I'd think that about anyone really...don't get me wrong, I and most others envy your position, and I'd probably be upset if I were you too, but still. Guess it depends on what side of the fence you're on..

[Relapse]

Poor poor rich people, I feel sad about them paying so much in taxes. Even more when I watch what they spend on their daughters sweet 16 party. And even more when I look at the underpaid CEOs and what they get as bonuses.

I think as a middle class worker, since I don't get taxed at all according to those facts, should donate some of my income to the rich. They look like they have it bad as they pass me in their bmw on the way to their beach house.

[Roxie]

DANG I LOVE SUPER SWEET SIXTEEN

ITS A GREAT SHOW

[Drekor]

Taxing the rich has it's limits, you're talking about people that often run large businesses and such and they'll simply past the cost down the ladder to the consumer where that extra money low-middle incoming earners get will just get sucked right back up. Kinda pointless...

[Aradorn]

fairtax.org

[Silver]

fairtax.org

I would love this.

[Soushia]

Taxing the rich has it's limits, you're talking about people that often run large businesses and such and they'll simply past the cost down the ladder to the consumer where that extra money low-middle incoming earners get will just get sucked right back up. Kinda pointless...


I don't know that I agree all that much with that. After all, when a CEO gets a $63 million bonus at the end of the year do you think they take that from the stockholders dividend pool or their overall earmarked labor percentage? Last time I checked, middle-class labor was losing their 401k while bonuses were getting paid to the top 1%.

As far as "money not trickling back down"...

If I make $2mil per year and my tax burden (after writeoffs) goes from $185k to 400k, I am still going to be putting gas in my car, starbucks in my hand, and pizza down my gullett. Granted, I might have to cut back and only buy a BWM 5 series instead of a 7 series...but I don't see how that quantifies into the middle class suffering.

[Splicer]

Unless that person is making 2 million a year in capital gains, he's paying a lot more than 185k a year.

[Elad]

More pro-Silver posts please. I don't want it to look like I attacked him or something with my original post.

And yes, I love sweet 16 too..but probably for other reasons :X

[Soushia]

Unless that person is making 2 million a year in capital gains, he's paying a lot more than 185k a year.

If you are making $2mil per year and don't have a good financial planner moving that money into Roth IRA's, real-estate (via an LLC), and some charity to mitigate yearly tax burden then you should be dragged out behind the shed and beaten repeatedly in the head with a tack hammer.

[Spiker]

The truth is ppl who make > $100k pay more in taxes than alot of ppl make.

A guy making 100k is taxed 21,978 for income tax. How many people making 21,978 does it take to equal the amount the 100k guy pays in tax?
$100,000 per year is taxed $21,978
$21,978 per year is taxed $2,895.

$21,978 / $2,895 = 7.6 ppl.

In other words the guy earning 100k pays the equivlant tax to 7.6 ppl earning $22k.

What is middle class? 50k?

$50k earning = $8,844 tax. $21978 / $8844 = 2.4 50k earners
It takes 2.4 ppl earning 50k to match the tax of 1 person earning 100k.

Higher earners already pay a higher percentage + plus they pay based on a higher amount. Let me put it this way, 15% of of 100k is still alot more than 15% of 20k. But in fact the 100k person pays a higher percentage already.

In California the 100k doesn't go that far.
100,000 - 21,978 = 78022.
100,000 - CA State @9.4% (9400)

78022 - 9400 = $68622 available after income taxes in CA
Remember you pay taxes yearly on your cars, home, and of course sales tax. There are also taxes on gasoline, tobacco, alcohol.

If you guys think the luxury car driving car isn't doing enough to help pay for our government, maybe you should calculate how much you pay to keep our government running, then consider the idea of the government spending less.

Why should high earners be taxed any higher than they already are? Because you are jealous that they drive a nice car, or that they are highly trained, highly valued.

It is a selfish view if you haven't worked the math to think that the rich should contribute more so YOU can contribute less. The rich already do contribute more!!!

Soushia's 6.3 mil exec would pay $2,183,597 in income taxes. That is equal to 100 of the 100k earners. So that one guy pays 100 times more for our government to operate than the 100k earner, and he pays as much tax as 754 people who earn $22k per year.

http://www.moneychimp.com/features/tax_brackets.htm?year=2008&status=S&income=6,300,000&tax=118,597

Single Filing Status

(Tax Rate Schedule X)
10% on income between $0 and $8,025
15% on the income between $8,025 and $32,550; plus $802.50
25% on the income between $32,550 and $78,850; plus $4,481.25
28% on the income between $78,850 and $164,550; plus $16,056.25
33% on the income between $164,550 and $357,700; plus $40,052.25
35% on the income over $357,700; plus $103,791.75

[Soushia]

That is an excelent breakdown. However...now we are comparing "net" -vs- "gross".

As a "middle class" filer, the ONLY thing you have to claim worth squat is kids...who are a ginormous expenditure in the first place, as well as some property value depreciation depending on where you live.

What I would love to see is what the average tax breaks/ tax writeoffs for the average filing person in those 3 brackets.

Other than being below the poverty line (what is that now? 17k/yr) and qualifying for the EIC (earned income credit), the tax system is totally geared to the wealthy.

I already did my 1st quarter filing for 2008 (my first year as an LLC), earned almost $26,000 and paid no taxes (all paid via 1090). Yet I have almost $4,000 in tax credit towards the rest of my filing. So by extrapalation (ignoring thresholds and caps) I am on target to earn $104,000 for the year, I will pay ZERO taxes, and get a refund of $16,000.

Now for the love of god tell me how that makes sense!

[Relapse]

If you guys think the luxury car driving car isn't doing enough to help pay for our government, maybe you should calculate how much you pay to keep our government running, then consider the idea of the government spending less.

Why should high earners be taxed any higher than they already are? Because you are jealous that they drive a nice car, or that they are highly trained, highly valued.

It is a selfish view if you haven't worked the math to think that the rich should contribute more so YOU can contribute less. The rich already do contribute more!!!

A rich person contributes the same percentage of their income as me. Maybe a few percent more, but mostly the same. You can't really say all rich people are highly trained and highly valued. I doubt some major porn distributor or an executive who got rich from a stock scandal then got a slap on the wrist is a high value to society. Top value in society does not equal top pay. And you don't need to be highly trained to be rich.

I'm not jealous of the person driving the nice car. I just have no sympathy for them when they cry about taxes. We both contribute about the same percentage of our income. He does pay more in monetary means, but we both are able to make that money by living in the United States where are taxed fairly in my opinion. We both have the means to move to another country if we think we would live better lives.

I don't want higher taxes for anyone. I would just like the government to learn to spend the money we all give them with more consideration and thought.

[Spiker]

A rich person contributes the same percentage of their income as me. Maybe a few percent more, but mostly the same. You can't really say all rich people are highly trained and highly valued. thought.

Yer right they aren't all highly trained or highly valued, but they aren't on welfare either...

Actually the higher yer earning the higher percentage yer tax rate, so a rich person (defined as earning more???) does contribute at a higher percentage. Unless yer quote above is stating that a rich person and you contribute the same percent because you are in the same bracket.

If that is yer situation maybe we should raise taxes on YOU, so we can all sit around and do less, while you pay for our roads, schools, and communtiy outreach programs. Meanwhile maybe we should complain about the fact that YOU drive a nice care, and can stuff pizza down yer gullet, even after we tax you MORE. If only we could be like YOU, and keep YOU DOWN, we would feel better about OURSELVES. Har Har just joking Relapse, yer alright, I dun believe anything they say about ya, and this last paragraph were just fer fun.

Stepping on other peoples bubbles doesn't make yours rise any higher Oh but it makes you feel a whole lot better

[Diraker]

I favor a progressive tax system because those with more benefit more from the protection and services government provides. That those with more end up paying more.

[Konrad]

I favor a progressive tax system because those with more benefit more from the protection and services government provides. That those with more end up paying more.

That would be true if taxes simply went to basic public services and national and civil defense. That argument does not hold up when the majority of tax revenue goes to social welfare programs, government required retirement accounts, government sponsored education, pork-barrel spending programs, health care programs, and everything else that the government spends our tax money on that doesn't fall under the so called "neighborhood effect" of common benefits.

[Silver]

I don't want higher taxes for anyone. I would just like the government to learn to spend the money we all give them with more consideration and thought.

Turn this into a bumber sticker please!!!!

[Diraker]

For my entire lifetime republicans have failed to deliver on their claims of fiscal conservatism.

[Konrad]

For my entire lifetime republicans have failed to deliver on their claims of fiscal conservatism.

Besides the Reagan years, most undoubtedly. However, they are certainly a better alternative than the Democrats.

[Soushia]

For my entire lifetime republicans have failed to deliver on their claims of fiscal conservatism.


In my lifetime Republicans have become Democrats and Democrats have become Republicans. They all equally suck and those of you who desperately cling to a party affiliation as some form of identification are all kiding yourselves when you think one party represents your point of view or best interests...unless you work for a lobby.

[Diraker]

Equally suck in certain respects but, and I've said it a million times, the issues that matter most to me revolve around the Supreme Court. I think democrats and republicans differ here. And even though I favor democratic appointees they are by no means perfect or represent me 100% of the time.

[Soulein]

The libertarian Republicans and other more socially liberal Republicans need to wrest control of the GOP back from the Mega churches.

If I ever get into politics, this will be my goal.

[Oakbone]

In my lifetime Republicans have become Democrats and Democrats have become Marxists. They all equally suck.

Fixed that for you :)

[Mourne]

The libertarian Republicans and other more socially liberal Republicans need to wrest control of the GOP back from the Mega churches.

If I ever get into politics, this will be my goal.

phaaaaaaaaaaat