# Does Paul Ryan want to make the US a tax-free zone for billionaires? **URL:** \ **Category:** Politics & Elections\ **Created:** [August 15, 2012, 7:48pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597 "2012-08-15T19:48:28Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![Jas09](https://avatars.discourse-cdn.com/v4/letter/j/d07c76/32.png) [@Jas09](https://boards.straightdope.com/u/Jas09)\ **Post date:** [August 16, 2012, 2:37pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/21 "2012-08-16T14:37:01Z")
**Debaser** - does Romney/Ryan’s plan make any of the distinctions you outline? My understanding is it doesn’t. Do you still support it without those caveats, and with the understanding that cutting taxes this way in a revenue-neutral plan means they have to go up on earned income? ETA: I just did quick search and it looks like Romney’s plan only cuts rates to zero for AGI under $200,000. Of course it also repeals the AMT and calls for 20% marginal rate cuts across the board (over current rates) - so I’m not really sure how the math could possibly work to make it revenue neutral. ---
**Author:** ![Debaser](https://avatars.discourse-cdn.com/v4/letter/d/3da27b/32.png) [@Debaser](https://boards.straightdope.com/u/Debaser)\ **Post date:** [August 16, 2012, 2:37pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/22 "2012-08-16T14:37:31Z")
> [@ElvisL1ves](#): > > You don’t “earn” interest. You earn wages. Interest and capital gains are \*unearned \*income, which is a highly appropriate name, too. Yeah! To hell with anyone who has a bank account. Let’s find the nearest tree and string them up! :rolleyes: But your silly statement actually sort of backs up what I’m saying. I’d argue that Warren Buffet “earns” his returns more than Romney, since Buffet is actively managing his empire and constantly changing it. You would make an argument that he should pay a higher tax. This would give capital gains a sense of fairness that they lack now. Why should Warren Buffet pay the same rate as a retired worker who has his $500,000 invested in an index fund? ---
**Author:** ![Debaser](https://avatars.discourse-cdn.com/v4/letter/d/3da27b/32.png) [@Debaser](https://boards.straightdope.com/u/Debaser)\ **Post date:** [August 16, 2012, 2:41pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/23 "2012-08-16T14:41:31Z")
> [@Jas09](#): > > **Debaser** - does Romney/Ryan’s plan make any of the distinctions you outline? No, it doesn’t. > [@](#): > > My understanding is it doesn’t. Do you still support it without those caveats… Yes. My first choice would be something more nuanced. But if the choice is current capital gains or zero, I choose zero. We tax people in different ways all the time. Some states have a sales tax, some states don’t. There are plenty of ways to skin a cat. Another good idea would be to get rid of income and capital gains altogether and do a sales tax nationally. That way, rich or poor, you only pay taxes when you spend and we encourage everyone to save. Of course, you’d need an exception for the first 50K or so to keep the half of people who don’t pay income taxes now still not paying taxes. > [@](#): > > … and with the understanding that cutting taxes this way in a revenue-neutral plan means they have to go up on earned income? No. You can cut spending. ---
**Author:** ![Euphonious\_Polemic](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/euphonious_polemic/32/3002_2.png) [@Euphonious\_Polemic](https://boards.straightdope.com/u/Euphonious_Polemic)\ **Post date:** [August 16, 2012, 2:44pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/24 "2012-08-16T14:44:43Z")
> [@Debaser](#): > > I’m in favor of a zero percent capital gains in many situations with some caveats. > > Most people work to earn their income through some sort of employment. Romney inherited some wealth, but most of his money was made in his career at Bain Capital. Once you’ve earned that wealth it should be yours and not taxed again. Romney is not being taxed on money that he has already earned. This would be the case if there was a wealth tax in place - ie if the government charged him a percentage every year of the money that he has stashed in his mattress. This does not occur. Taxes are levied on money _earned_. When Romney has money in investments, he _earns_ new money. This new, earned money is the only money that is taxed. He is not taxed on his capital investment. He is taxed on the money he _makes_ from his capital investment. If he loses money on a capital investment, he can take a tax _deduction_. On another note, I’m amused by anyone who posits that one reason not to tax dividends or interest income or capital gains is that if you eliminate these taxes, then people will invest more money, and thus create jobs. Tell me… Is there anyone out there who has money to invest, but is keeping it under their bed in a box for the sole reason that if they invest it, they will have to pay a small amount of tax on the profits they will make from it? In other words, they are voluntarily forgoing a profit because they’ll have to give up **15% of that profit?** ---
**Author:** ![ElvisL1ves](https://avatars.discourse-cdn.com/v4/letter/e/5daacb/32.png) [@ElvisL1ves](https://boards.straightdope.com/u/ElvisL1ves)\ **Post date:** [August 16, 2012, 2:45pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/25 "2012-08-16T14:45:50Z")
> [@Debaser](#): > > :rolleyes: > > But your silly statement :Shrug: Tell the IRS. That’s \*their \*definition. ---
**Author:** ![Jas09](https://avatars.discourse-cdn.com/v4/letter/j/d07c76/32.png) [@Jas09](https://boards.straightdope.com/u/Jas09)\ **Post date:** [August 16, 2012, 2:47pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/26 "2012-08-16T14:47:13Z")
> [@Debaser](#): > > No. You can cut spending. Revenue-neutral, not deficit-neutral. Same answer? ---
**Author:** ![BobLibDem](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/boblibdem/32/3149_2.png) [@BobLibDem](https://boards.straightdope.com/u/BobLibDem)\ **Post date:** [August 16, 2012, 2:51pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/27 "2012-08-16T14:51:52Z")
> [@Euphonious\_Polemic](#): > > Tell me… Is there anyone out there who has money to invest, but is keeping it under their bed in a box for the sole reason that if they invest it, they will have to pay a small amount of tax on the profits they will make from it? In other words, they are voluntarily forgoing a profit because they’ll have to give up **15% of that profit?** Very well said. If we believe Republicans, the wealthy would rather have 100% of zero than 85% of something. ---
**Author:** ![Euphonious\_Polemic](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/euphonious_polemic/32/3002_2.png) [@Euphonious\_Polemic](https://boards.straightdope.com/u/Euphonious_Polemic)\ **Post date:** [August 16, 2012, 3:05pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/28 "2012-08-16T15:05:37Z")
> [@Debaser](#): > > Yeah! To hell with anyone who has a bank account. Let’s find the nearest tree and string them up! How about if we have them pay an appropriate tax on the income they EARN from their investment in the bank account? The same way I pay an appropriate tax on the money I EARN from working. How would that be? And I have to say, this continual equating of “appropriate taxes should be paid on a variety of types of income” with “we hate the rich, string them up” is becoming exceedingly tiresome. ---
**Author:** ![Ludovic](https://avatars.discourse-cdn.com/v4/letter/l/7ab992/32.png) [@Ludovic](https://boards.straightdope.com/u/Ludovic)\ **Post date:** [August 16, 2012, 3:11pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/29 "2012-08-16T15:11:23Z")
> [@BobLibDem](#): > > Very well said. If we believe Republicans, the wealthy would rather have 100% of zero than 85% of something. It’s not theoretically impossible that this is sometimes the case. There are risks to investment, and the extra 5-10% one might be taxed in a high versus low tax environment might make the difference between an enterprise that’s worth pursuing and one that isn’t. The downside is the same: you lose all your cash. The upside is different: you gain 5-10% less profit. That may change the equation for some people. However, that’s in theory. In practice, at least for the past 15 years, taxes on investment profit have decreased while investment has also decreased. ---
**Author:** ![Ludovic](https://avatars.discourse-cdn.com/v4/letter/l/7ab992/32.png) [@Ludovic](https://boards.straightdope.com/u/Ludovic)\ **Post date:** [August 16, 2012, 3:19pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/30 "2012-08-16T15:19:42Z")
> [@Debaser](#): > > I’d like to see the difference between long term and short term capital gains enhanced. The most equitable (heh) situation I see is one in which all income is considered equal, but indexed for inflation. So if I held a stock for 10 years and it has doubled, but inflation has only gone up by 50%, then when I sell it, it gets taxed as ordinary income, but the first 50% of the appreciation is ignored. And of course the hotshot fund managers who get millions per year in short term gains would basically have to pay for it as normal income. The downside of this is it would increase the incentive to play political games with the measurement of the inflation rate. ---
**Author:** ![Debaser](https://avatars.discourse-cdn.com/v4/letter/d/3da27b/32.png) [@Debaser](https://boards.straightdope.com/u/Debaser)\ **Post date:** [August 16, 2012, 3:24pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/31 "2012-08-16T15:24:16Z")
> [@Euphonious\_Polemic](#): > > Romney is not being taxed on money that he has already earned. Not sure why you are lecturing me on this since it’s clear from my post that I understand this completely. > [@](#): > > Taxes are levied on money _earned_. When Romney has money in investments, he _earns_ new money. This new, earned money is the only money that is taxed. He is not taxed on his capital investment. He is taxed on the money he _makes_ from his capital investment. If he loses money on a capital investment, he can take a tax _deduction_. Uh-oh. **ElvisL1ves** is going to be all over you for saying people _earn_ money on investments! > [@](#): > > Tell me… Is there anyone out there who has money to invest, but is keeping it under their bed in a box for the sole reason that if they invest it, they will have to pay a small amount of tax on the profits they will make from it? In other words, they are voluntarily forgoing a profit because they’ll have to give up **15% of that profit?** Sure there is. They can do things with it that don’t result in the US capital gains tax, like invest it overseas for instance. ---
**Author:** ![Debaser](https://avatars.discourse-cdn.com/v4/letter/d/3da27b/32.png) [@Debaser](https://boards.straightdope.com/u/Debaser)\ **Post date:** [August 16, 2012, 3:27pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/32 "2012-08-16T15:27:02Z")
> [@Jas09](#): > > Revenue-neutral, not deficit-neutral. Same answer? There’s a thousand ways you could do it in a revenue neutral way. You could implement a wealth tax, a sales tax, a sales tax just on items over 10,000 to just hit the rich, a VAT. Not sure what the point of this question is. ---
**Author:** ![Debaser](https://avatars.discourse-cdn.com/v4/letter/d/3da27b/32.png) [@Debaser](https://boards.straightdope.com/u/Debaser)\ **Post date:** [August 16, 2012, 3:29pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/33 "2012-08-16T15:29:27Z")
> [@Ludovic](#): > > And of course the hotshot fund managers who get millions per year in short term gains would basically have to pay for it as normal income. This is a loophole that should be closed immediately. In fact, it’s not even really a loophole, just a bunch of people basically making up a new rule as they go along and the IRS for some reason ignoring them. Clearly the fund managers who pay cap gains instead of income tax are being compensated for their work. They aren’t investors. I have no idea why the IRS allows this but they should stop it tomorrow. ---
**Author:** ![BobLibDem](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/boblibdem/32/3149_2.png) [@BobLibDem](https://boards.straightdope.com/u/BobLibDem)\ **Post date:** [August 16, 2012, 3:36pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/34 "2012-08-16T15:36:59Z")
> [@Debaser](#): > > Not sure why you are lecturing me on this since it’s clear from my post that I understand this completely. Not apparent at all from your post 19: > [@](#): > > Once you’ve earned that wealth it should be yours and not taxed again. ---
**Author:** ![Euphonious\_Polemic](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/euphonious_polemic/32/3002_2.png) [@Euphonious\_Polemic](https://boards.straightdope.com/u/Euphonious_Polemic)\ **Post date:** [August 16, 2012, 3:41pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/35 "2012-08-16T15:41:35Z")
> [@Debaser](#): > > Not sure why you are lecturing me on this since it’s clear from my post that I understand this completely. You might understand, by it’s apparent that many do not. > [@Debaser](#): > > Uh-oh. **ElvisL1ves** is going to be all over you for saying people _earn_ money on investments! Putting words in other people’s mouths, supposing what they might say, is not a worthy form of debate, and lends nothing to the conversation. > [@Debaser](#): > > Sure there is. They can do things with it that don’t result in the US capital gains tax, like invest it overseas for instance. And I guess if they make overseas income that should have been legally reported to the IRS, they can just take advantage of a tax amnesty later on, right? ---
**Author:** ![Debaser](https://avatars.discourse-cdn.com/v4/letter/d/3da27b/32.png) [@Debaser](https://boards.straightdope.com/u/Debaser)\ **Post date:** [August 16, 2012, 3:42pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/36 "2012-08-16T15:42:23Z")
> [@BobLibDem](#): > > Not apparent at all from your post 19: > [@Debaser](#): > > Once you’ve earned that wealth it should be yours and not taxed again. Give me a break. Here’s the full quote of what I actually said: > [@Debaser](#): > > Once you’ve earned that wealth it should be yours and not taxed again. > > But, it’s true that money tends to grow over time. If Romney earns interest on that money should it be taxed? I then get into answering that question in my post. What are you two doing? Only reading the first two lines of my post and then responding? ---
**Author:** ![Jas09](https://avatars.discourse-cdn.com/v4/letter/j/d07c76/32.png) [@Jas09](https://boards.straightdope.com/u/Jas09)\ **Post date:** [August 16, 2012, 3:46pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/37 "2012-08-16T15:46:31Z")
> [@Debaser](#): > > There’s a thousand ways you could do it in a revenue neutral way. You could implement a wealth tax, a sales tax, a sales tax just on items over 10,000 to just hit the rich, a VAT. > > Not sure what the point of this question is. The point is that in order to put in place these cuts in a revenue-neutral fashion new revenue has to come from somewhere. And the current proposal is to get them from removing “loopholes and deductions”, which basically means middle-class deductions like health insurance and mortgage interest. There just isn’t enough money in loopholes to get close to the kind of cuts being proposed. I fully agree that the carried interest rules should be discarded immediately. And I’d give Romney full credit if he proposed that, since it would affect him directly. As far as I know, he has [not proposed that change](http://www.washingtonpost.com/blogs/ezra-klein/wp/2012/08/15/what-is-the-carried-interest-loophole-and-why-doesnt-romney-want-to-close-it/) (Obama, on the other hand, [has](http://finance.fortune.cnn.com/2012/02/13/obama-budget-targets-carried-interest/)). ---
**Author:** ![Debaser](https://avatars.discourse-cdn.com/v4/letter/d/3da27b/32.png) [@Debaser](https://boards.straightdope.com/u/Debaser)\ **Post date:** [August 16, 2012, 3:46pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/38 "2012-08-16T15:46:34Z")
> [@Euphonious\_Polemic](#): > > You might understand, by it’s apparent that many do not. There’s no evidence anyone in this thread doesn’t understand this basic concept. > [@](#): > > Putting words in other people’s mouths, supposing what they might say, is not a worthy form of debate, and lends nothing to the conversation. You’ve got me there! > [@](#): > > And I guess if they make overseas income that should have been legally reported to the IRS, they can just take advantage of a tax amnesty later on, right? Taking cheap shots at what might or might not be in Romney tax returns is not a worthy form of debate, and lends nothing to the conversation. It’s true, even if you don’t like it, that rich people now are global. They own investments and companies that exist globally and they can and do move themselves and their investments to avoid high taxes. See France. ---
**Author:** ![XT](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/xt/32/456_2.png) [@XT](https://boards.straightdope.com/u/XT)\ **Post date:** [August 16, 2012, 3:58pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/39 "2012-08-16T15:58:39Z")
> [@](#): > > To review, Ryan wants to eliminate taxes on interest income, capital gains, dividends, and the estate tax. You are working off of his 2010 proposal from what I understand. He’s since released newer proposals that don’t eliminate things like capital gains taxes. According to a FactCheck article I was reading the other day the Dems are viciously attacking Ryan over earlier versions of his proposals, and deliberately ignoring the fact that they were a work in progress and that he’s continued to refine and submit the things with changes. Now, you might not like the new ones either, but they are different than the older ones, and my understanding is that he’s modified his earlier hard line stance in the face of reality. Not anywhere I can look it up right now, but I’ll see if I can dig up that FactCheck article later if you like. I realize that FactCheck is now on par with Fox News around here, but I still think it’s a valid resource for this sort of thing. ---
**Author:** ![BobLibDem](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/boblibdem/32/3149_2.png) [@BobLibDem](https://boards.straightdope.com/u/BobLibDem)\ **Post date:** [August 16, 2012, 4:03pm UTC](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597/40 "2012-08-16T16:03:50Z")
> [@XT](#): > > You are working off of his 2010 proposal from what I understand. He’s since released newer proposals that don’t eliminate things like capital gains taxes. According to a FactCheck article I was reading the other day the Dems are viciously attacking Ryan over earlier versions of his proposals, and deliberately ignoring the fact that they were a work in progress and that he’s continued to refine and submit the things with changes. Now, you might not like the new ones either, but they are different than the older ones, and my understanding is that he’s modified his earlier hard line stance in the face of reality. Not anywhere I can look it up right now, but I’ll see if I can dig up that FactCheck article later if you like. I realize that FactCheck is now on par with Fox News around here, but I still think it’s a valid resource for this sort of thing. They may have been proposals that he has modified or abandoned, but nonetheless provide insight into what his philosophy is. The early proposals are what he wants to do, the later ones are bending to the political realities. [Previous page](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597.md?page=1) [Next page](https://boards.straightdope.com/t/does-paul-ryan-want-to-make-the-us-a-tax-free-zone-for-billionaires/631597.md?page=3)