That was 2 days ago. And the link is to Fox since you apparently don’t trust the reporter for ABC News. Why do you refuse to accept reality?
Cool. Of course, I’ll believe it when I see it. And I strongly suspect I won’t see it. Our President has a tendency to say a lot of things while actually never meaning them or doing them.
So, Terr, what is wrong with the tax system being progressive? You keep talking about what is “fair”, but I do not see what is wrong with those households that make less (on average) than $49,000 only pay ~10% of their income, while those households that make on average $1,200,00 per year pay ~30% of their income. Do you think everyone should pay the same rate? Would it be fair to make those families that make less than $15,000 a year pay 30 percent also? What would be fair in your book?
For me, a progressive tax system is fair because the wealthy get more benefit from the infrastructure in this country than the poor do. Business owners and people with investments in this country get much more benefit from the infrastructure, the military (free trade), and the educated workforce in this country than a poor person working at Walmart. Is this fair?
Anyway, as a liberal I don’t think that we need to triple rates on the top 1%, and my main beef with the tax system is the low rate on long term capital gains and some dividends (35% for the top marginal rate is actually fine IMLHO - L is for liberal). That said, I don’t see what the big deal is asking for another 3% on the top marginal rate. It should not be that big a deal and will probably not harm the economy since most of the investment these days is happening overseas anyway.
Finally, one thing I do believe in is that the revenue stream should more or less match the expenditures. If we were running surpluses, we could cut everyone’s taxes including the top 1%. Feel the need to give drug benefits to the elderly on the taxpayer’s dime and fight a bunch of wars around the globe? Well, we better raise taxes to pay for these programs. Should the rich bear the entire burden for these programs? No, at least IMHO, but they should bear more of the burden than the poor simply because they can. Should we get rid of these expenditures and thus sidestep the whole tax discussion? Maybe, but it’s too late now. Much (if not the majority) of the current deficits can be laid at the feet of the Republican administration and congresses in the early 2000’s (Medicare part D, Bush tax cuts, wars in Iraq and Afghanistan and the associated veteran’ benefits). What debt can’t be laid at their feet is mostly due to the decreased revenue during the current downturn.
Even addressing that is buying into Terr’s framing. Nobody has called for the top 1% to pay triple what the middle class pays.
What would be fair in my book is eliminating income tax completely, because it is one of the most inefficient and counterproductive methods of taxation, in my opinion. So - now that I answered that, what would be “fair” in your book? 10-15% vs 30% is obviously not “fair”. But if you add a few percent to that 30% it becomes “fair”?
Why not? The criteria seems to be “they can afford it” - they can afford tripled rates, can’t they?
Since adding that 4% on the “rich” will be a drop in the bucket towards the goal of “revenue matching the expenditures”, what are your other proposals to reach that goal?
That’s a real nice story. You want to answer my question now?
So explain to me, what is the difference in principle between paying double what the middle class pays and paying triple?
The story answers your question. If you’re getting handouts, and they get cut off, that’s not a “sacrifice”.
Because of Mitt Romney. By running for president as a billionaire in the post-Bush tax cut era, he singlehandedly exposed the enormous inequities in our current tax code. People making six figures a year working as lawyers and doctors (i.e. making all their money from their salaries) who are paying 30-40% of their income in federal taxes should be absolutely furious at the Republicans for passing tax cuts that allow billionaires and hedge fund managers to pay <15%. Because the public is going to automatically lump them in with the Mitt Romneys of the world.
Fairness-wise, I think it’s fine for the top marginal tax rate to revert from the Bush level to the Clinton level, but far more important is to revoke the ultra-low rates for dividend and capital gains income for high earners. We should also replace the Alternative Minimum Tax with the Buffett rule, so that everyone above a given income (adjusted for inflation) pays a reasonable minimum tax rate. Billionaires should not be paying less than half the effective tax rate of dentists and surgeons.
So you’re doubling down on ignorance. Got it.
50%. And reality.
Nope. I’ve seen lots of polls over the years that have shown people underestimate how much taxes are paid by “the rich”. This predates Romney, even if he may have exacerbated the problem.
The story was about stopping a stipend once the recipient died. Unless you’re planning to kill everyone on Social Security, Medicare, and Medicaid, then no, it really doesn’t answer my question.
No, but I’d argue that Mitt Romney is pretty much singlehandedly responsible for people’s current belief that a typical tax rate for someone in the top 1% of annual income is <= 15%. Some people may have had a vague notion of the rich having lots of tax shelters and loopholes available to them before that, but now people have a hard number of what very rich people are paying. And it’s a low number.
“If you’re getting handouts, and they get reduced, that’s not a “sacrifice”.” - that answers your question. In terms of “entitlement reform” - the part of the “entitlement” that the recipient paid for - such as the sum of Social Security contributions with reasonable ROI - is not a handout. The rest of it is.
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Maybe I misunderstand how polls work, but I always answer the poll before reading the rest of the thread. Reading everyone else’s responses and then answering the poll seems to not be in the spirit of an IMHO poll.
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The poll was going on without clarification, despite being asked for several times, regarding how (s)he was handling taxes paid by corporations. I think if it was made clear to those reading the poll that taxes paid by corporations who then distributed dividends to 1% or above individuals (or interest or capital gain income) would be handled not as an expense to the corporation but as individual tax paid by the 1%er, many would have given different answers. Certainly I would have. It is of note that Romney’s reported 14% was based on income tax alone. Minimally he likely “paid” (via the fact that the companies that are the source of his income paid taxes) another 8% indirectly. Note that even Romney was not stupid enough to try to play that as his tax burden.
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Agreed however that the general public does not appreciate the difference between the 2% (Obama’s definition of wealthy in these fiscal cliff posturings), the 1%, and the 0.1 and 0.01% who have increasingly accumulated a larger and larger share of the wealth and income of this country.
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The bottom line is that in our supposedly progressive system of taxation the 1% pay (not counting taxes paid by corporations as art of doing business before they distribute profits to shareholders, etc.) only about 3% more than the the average tax payer. It did not used to be so. That graphic (which includes giving credit for corporate taxes) shows how the effective tax rate for most everyone has stayed flat since the 70s, except a modest decline for the 1% and a HUGE drop for the top 0.01%.
If you raised the top bracket to 90% or something, then you could say the rich were getting the shaft. The actual increase is a pinprick at most. Now raising the tax rate on people just barely getting by is giving them the shaft.
I am not going to slog through all three pages of replies, but the first page seems to overlook
the fact that the way it is written OP should only be taken to mean what percentage of their
income the rich actually pay in Federal taxes, not what their statutory Federal tax rate is.
It is certain the average payment is a hell of a lot less than the ~29.5% statutory.
I selected the 20% option, and I would not be suprised if it was around 15%.
And as you read on you will find out you’re wrong. Which was the point.
Since everyone seems to have ignored this post, I’ll bring it up again. Tax policy is not random - the reason you cut taxes in a recession caused by a drop in consumption is to increase consumption. (A recession caused by lack of investment is another matter, and this one isn’t one of those.) Increasing taxes on those making under $250K a year will decrease consumption (though the breakpoint might be a bit lower.) Increasing them on the 1% won’t affect consumption at all.
The proof that this is what the tax cuts are about is that Obama did the payroll tax cut, which was nearly invisible so he didn’t get as much credit as sending a check, because the behavioral economists told him that this increases consumption more than a check would, which tends to go into savings or paying down debt.
The European austerity program has involved not just spending cuts but also across the board tax increases. Hasn’t helped much, has it.
And there is also the fact that each incremental dollar is worth a lot less to the rich person than the poorer person. That is why progressive taxation makes sense - it is closer to equalizing the pain, which decreases faster than linearly with increasing income.