Three years ago, the economy was in a mess and the government essentially borrowed a metric boatload of money to try to stimulate our way out of it. While there’s a certain ambiguity about whether that worked or not, it’s unquestionable that the markets have pretty much recovered. At the heart of the economic downturn, I, as a very middle class American, had, on paper, lost several tens of thousands of dollars. I fortunately did not lose my job and didn’t have to liquidate any assets, so all those investments have now recovered and bit more besides. So I personally regard the funds spent by the government in avoiding permanent hideous economic disaster as money well spent.
Now we’re heading into possible default and the sticking point seems to be the Republican’s insistence on No New Taxes, even though we’re now paying what are historically pretty low taxes. As for me, I’m worried about rising gas prices, fuel oil prices, and food prices, but my tax bite isn’t something I get too worked up about except for a week or so around April 15th. Realistically, if it went up $500.00/year or $1000/year, I’d curse a bit (or possibly more than a bit), pay it, and get on with my life. And I’m far below Obama’s target range of taxable people.
Now if we do have a default, I can easily see another big market crash. So let’s weigh the possible outcomes. A mildly unpleasant increase in taxes each year, or a completely disastrous plunge in the markets that could cause a 20 or 30% hit to our collective net worth.
Me, I’m willing to pay the taxes. Because the alternatives really, really suck. And, as a fiscally conservative person, I’m in favor of paying off debts once they’re incurred.
What’s the problem with the rich? They can spare it even easier than I can.
The problem is why should the rich pay, or that’s their opinion. You say rich can afford it more than you can, I believe it, but I would also bet there are some people poorer than you, that are looking at you and saying, ‘Why can’t you give me some of your stuff’?
Would you be willing to pay more to support those poorer than you?
Well, I can say it’s not ALL the rich. Warren Buffett has been outspoken about his own low rate of taxation and why it should be higher. In his own words, there’s no reason he should pay a lower percentage of his income in tax than his secretary.
I’m in one of the brackets that should probably see a mild increase in tax rates. It would suck to get a tax hike, but I see the necessity. I also agree for the folks in the even higher brackets.
In the pessimistic case, I don’t want a horde of poor, illiterate bumpkins attacking me and mine for being ‘haves’ after our society collapses from a congenital case of idiocy.
In the optimistic case, I understand the many benefits tax dollars have given me (public education, roads, police, etc) and realize that my tax burden is lower than for almost any person of comparable means from the last century.
Mostly they aren’t. They are opposed to paying MORE taxes, especially if they think they are just going to be soaked so that the government can simply spend more.
Then you are in the minority. Most people don’t want to pay more taxes, especially if they see the government as wasting their money and unlikely to take those new taxes and attempt to substantially fix the various problems. If you could convince people that more taxes would not equal more entitlements or more military or more of whatever pet peeve any given person has against government spending then it would be easier to sell new taxes…especially if you didn’t just single out one group (a.k.a. The Rich™) to take on the burden of more taxes.
The trouble is that an increase in taxes (ANY increase in taxes, regardless of whether it’s on The Rich™ or on everyone) would be a huge political hit on the Republicans, who have all signed their names to various political tracts saying they won’t support new taxes. It would be similar to the political hit that Democrats would take if there were substantial cuts to various entitlement programs or stuff like Social Security. Me, I’d be willing to have my taxes go up if there were meaningful cuts to spending (including military spending) across the board, and if I could be convinced that those cuts would actually happen and be followed through on.
One thing I was reading earlier is that even if they DO get the debt limit increase, without demonstrating that we are willing to address problems with spending we are STILL going to be downgraded by places like S&P and Moody’s…which means that this isn’t going to be a magic fix that keeps our AAA standing if they just pass some BS legislation to up the debt limit.
I’m with you here…I’m willing to have actual tax increases across the board, close loopholes and increase government revenues substantially. But only IF there are real and meaningful cuts across the board to spending. Sadly, both political parties would take major hits for making such a compromise, especially with their bases, so it seems unlikely to happen. I doubt we will default…what will most likely happen is some compromise that allows the debt limit to be raised temporarily or by a small amount, and perhaps some face saving stuff for both parties and the Prez (who will take a large hit if this happens, since he’s sort of painted himself into a corner just like the Republicans and Democrats about wanting a ‘grand bargain’)…and the problems will all still be with us. I don’t see how we can get around that with the fringe on both sides pushing their parties into positions from which no meaningful negotiation can happen because anything that would be acceptable to the fringe is going to be completely unacceptable to the other side and vice versa.
We are, in short, fucked for any sort of meaningful deal and will get an ad hoc temporary solution that will keep things going but won’t address any of the underlying problems or issues. C’est la vie.
The Rich™ are not the root cause of the problems in the country, and they aren’t the solution. Just like the poor aren’t the problem and they aren’t the solution either. The solution isn’t just to keep on spending the way we were and simply squeeze The Rich™ for more money, it’s to get our spending under control and be realistic about what we can and can’t have the government do.
I don’t think the rich are so opposed to paying taxes. Or even “opposed”. I’m not rich, but I understand their point—that they shouldn’t be paying such a disproportionate share of them. I think if you had a flat tax—closing all the loopholes now exploited by the truly rich—that they be much happier paying taxes. And even agreeing to a tax increase if times called for it. Income tax isn’t the whole story, but it is grossly unfair when one person has to work 2 out of five days a week for the government (assuming a 40% tax) and someone has to work 1 day or less to meet his obligation as a citizen and contribute to the public coffers. Sure, there should be a cut off for the destitute, but an escalated tax structure is grossly unfair, not to mention easily abused.
This is, of course, ignoring the fact that when all taxes are factored in, we nearly have a flat tax system in America with all groups paying roughly around 30%.
(I looked for the cite and couldn’t find it. Anyone have it bookmarked?)
Flattening the federal taxes would disproportionately affect lower income groups unless tax forgiveness is somehow factored in.
True, but look at the current situation. It seems very clear that spending cuts alone aren’t enough to make a dent in the deficit. It seems to be “either suck it up and pay some taxes” or “have an economic meltdown that’s going to cost you far, far more.”
Does anyone have a cite showing that the rich are opposed to paying more in taxes, say a move back to the 1990s levels? Certainly some are, but some are not. Now, Republicans are deadset against the rich paying more in taxes, but that is a different matter.
I suspect all rich people know that they won’t be hurt by a small increase in the marginal tax rate. Those against it might be more concerned with reducing the size of government which sometimes gets in their way than giving up any money.
Enjoy what? What do you think that chart proves? We are in a recession, lots of unemployment, so government tax revenues are down. That doesn’t mean that tax RATES are at historically low levels, it means that the government is bringing in less. When someone says ‘Taxes are at a 50 year historical low’, that doesn’t mean (to me) tax revenue, but tax rate. YMMV but if that is what was mean then what was the point?
Obama this morning mentioned polls showing 80% of us are in favor of a budget solution which raises revenues, in other words, more taxes. At this point, more taxes can be easily sold as a way of avoiding cuts. No one is talking about growth, anywhere. It makes sense for the rich to pay more because the rich have gotten a lot more, while the poor and the middle class have seen wage stagnation.
You’re right on the (untaxed) money here.
Not so much here. The analogous Democratic position would be no cuts at all, on the grounds that there are plenty of people still suffering. The Dems are demonstrably behind fairly massive cuts, if not happily. If the proposal was for massive tax increases, say to 60% or 70% at the top bracket, then I can understand Republican opposition. Small increases, back to historical figures, or closing loopholes, not so much. The positions of the parties are not anywhere close to similar.
I suspect it depends on who ‘the rich’ is we are talking about. The super rich, like the oft quoted Buffet? He probably wouldn’t mind too much if he had to pay more in taxes than he current is paying (though if he REALLY thinks he’s paying too little then all he has to do is fire all his tax people and not bother with all those deductions and loopholes they find for him). But someone making $500k who is considered ‘rich’ is probably going to feel the bite of increased taxes, especially since the $500k- a few million in assets crowd doesn’t have an army of tax specialists to find creative ways to get out of paying large portions amounts of taxes. I know my dad, who is in the $500k group and who used to own his own business (a small business) was increasingly getting squeezed on taxes.
Again, I think it depends on who we are defining as ‘all rich people’, since different things are going to impact them in different ways. Bill Gates gives away to charity more than most ‘rich’ even have, so he probably wouldn’t be too upset by a ‘small increase’ in his marginal tax rate. A small business owner who is already paying what they feel are disproportionate taxes compared to the larger corporations they are competing against and who’s owners are paying a larger percentage of their income compared to their actual assets in taxes than someone like Buffet or Gates is…they are going to have a different take on a tax increase, especially if they see themselves being groups with richer folks and being singled out for a tax hike while the rest of us don’t have to pay for the problems the country faces. It might seem a bit unfair to them that they have to pay more while the other 98% of us don’t have to pay anything more to ‘fix’ our collective issues and problems.