GOP And Taxes

Just to get people to think about just how damn difficult this tax and budget business is going to get, I'd like to propose this:
Getting the GOP to agree to tax increases on the rich and not gutting social security and medicaid/medicare is like trying to get a Fundamentalist Christian to acknowledge Evolution or one of you to become an entirely different religion.

You are not dealing with facts and numbers here, you're dealing with a religion.  You can't go so far as to call it an ideology because of the faith backed nature of it.  Listen up, the Earth was not created six thousand years ago and supply side economics does not work.  Neither of them works because they ignore reality and facts in favor of faith.  Now why in the hell supply side has become a religion is way beyond me, but then Creationism is also.  Now I suppose that since there have been a couple books around for thousands of years that talked about the Garden there is some damned excuse for Creationism still being around, but for Cripes Sake this supply side nonsense only has St Ronnie, not God on its side.

None of that matters because it still is a religion and pushing the GOPers out of it is going to take a hell of a lot more than being nice to them.  What it is going to take is a choice between damnation and survival - most of them are way too big of cowards to chose martyrdom.  Now, you figure out what that is going to take.  Mr President and fellow Dems?

How To Ruin The Job Creators

The President-elect ran a campaign determined to mine enthusiasm for raising the top marginal tax rate from 35% to 39%.  The GOP has assured us that such behavior will mean economic Armageddon through the ruination of the people who "create" jobs.  Some sort of magic occurs at 35%.

I do not and no one I know hires a fourth person to do three people's work, that is just stupid.  Everyone I know of that hires people hires someone because three people can't do four people's work, which means that there is that much demand for the product.  If you're going to follow along on this "job creators" theme you're either telling people that rich people having some more money means they will gratuitously hire or that they spend enough money in the market place to drive that kind of demand.  I think we've dealt with the gratuitous hiring part but the demand part is ought to be as easy, 2% of the taxpayers do not buy all that much of anything (well, most yachts).

So what is the real impact?  Let's start with what marginal rate means - anything above an amount.  So, $250,000, after deductions, is taxed at the previous rates and anything above gets hit.  This would mean that of $260,000 after deductions $10,000 would be taxed at 39%.  Follow along, 10,000 x 0.39 is 3,900 and 10,000 x 0.35 is 3500 which is a grand total of another $400.  Holy shit, your taxes on Adjusted Gross Income of $260,000 will go up $400 and with that you will buy... what?  OK, sure we all know this is more about millionaires than than that 250K bunch so here's that number (assuming - ridiculously - that you somehow have $1M in ordinary income) $750,000.  Alrighty, more simple damn math: 750,000 x 0.39 is 292,500 and 750,000 x 0.35 is 262,500 so your 750K costs you $30,000 more.  That will buy one car that these people won't be seen driving or at the Federal Minimum Wage of $7.25 earning you $1580 at 40 hours for 52 weeks a whole $15,080, just less than two jobs washing the cars they actually would buy.  (no, we're not talking take-home pay)  Why does that millionaire need two additional minimum workers?  Nobody will tell you, they just squeal "job creators."

If people don't have goddam money they don't spend it on products and services.  Those people are called consumers and they produce jobs by consuming.  If 80% of the consumers are competing for 7% of the wealth there isn't going to be a lot of consuming going on out of that share.  What is actually the case is that the "job creators" are destroying jobs by sucking every last cent out of the economy.  It isn't the conservatives' bug-a-boo government that is sucking the life out of the economy, it is their protected class that is doing it.  It is real damn simple - the money is not moving around in the economy.

You can feel free to call it socialism, communism, or "punishing success" to advocate using the one tool the governement has at hand to change economic behavior, taxation, to address this concentration of wealth - but real simply, capitalism can't survive under the current conditions.  Most of the country can do pretty well under capitalism, those who can't can be addressed with an adequate safety-net, but we have today the Reaganism version of capitalism to live with and it ain't working.  Welcome to The Gilded Age aka Robber Baron Era.

People have serious doubts that the President can stick to his 39% rate which will do spit to address the problem and are worried about the safety-net...  Christ on a pogo stick.  Liberals seem to think this recent election did more than stave off absolute disaster.  Can this nation get any stupider about its plutocrat enabling?

The short answer, of course, is - Yes.

To Pay Taxes, Or Not To Pay ...

There is no doubt in my mind that more Americans should be paying Federal Income Taxes.  The operative word in that sentence is "should."  There is a damn good reason why the word isn't "can" without severe economic consequences.  It has everything to do with how the economic pie is carved up and what the reality of Taxes, in general, is in this model of economic dysfunction.

The first thing to address is what those non-Fed paying are paying and one my move out of Oregon has emphasized to me.  Most Americans pay sales tax and depending on the model in operation in a State, just how much the low and middle income pay for their State's operation.  This mess of a tax seems to range from about 5% to 7+% and though what is subject varies, food groceries are mostly out, every day needs are hit along with the more major purchases like vehicles and this hits a much larger share of income for low and lower middle income groups than anybody else.  There is an unholy mix of sales tax along with State income taxes and most of them are pretty damn regressive.

If you take a wage or salary anything up to $110,000 is subject to a tax of about 14% and there is no deduction on that (that rate can easily revert to the 15.3% rate).  You can go ahead and consider Mitt's published rate of about 14% on his millions of income.  Unless you're a church or favored Corporation you pay property tax and whether you own, "own", or rent you're paying these.  There are, of course, all kinds of specific taxes and fees like gas taxes and maybe the most insidious and nasty where tip receiving employees have their minimum wage slashed.

If you look at wages and salary that have been flat or falling versus inflation over the past 30 years you begin to get a sense of the impact of Federal Income Tax.  But that is really only a small part of what is going and talking about a symptom wealth distribution and, yup, taxes.  In 2007 the top 1% had 43% of the financial wealth in the US compared to the lowest 80% at 7% of the wealth.  Take into consideration that conditions have severely worsened since then.  There are structural reasons for this and there are policy and tax reasons for this.  I believe you can make the case that the structural reasons have much more to do with policy and tax policy than world conditions and even if they do not they are huge contributors.

It is frequently asserted that economics is not a zero sum game, as though this somehow mitigates conditions and quite basically ignores that at any given moment economics is exactly a zero sum game.  At any given moment there is exactly so much wealth within the system and how that wealth is distributed has everything to do with whether or not people earn money and spend that money and get taxed on those earnings.  If 80% of the population is competing for 7% of the wealth the system produces  they are going to take small portions and have small portions of a system that supports us all.

I really don't care what economic model one hews to from communism to unfettered libertarian capitalism the simple fact is that wealth is produced and protected by the infrastructure and various agencies.  These systems must be paid for, somehow, money has got to be put into creating and maintaining them.  If not enough people can afford or are willing to pay the piper the thing falls apart.  If you cut the share in wealth of the general population they cannot afford to support those essentials and if you allow the small percentage of the population to refuse the thing is broken.  The reason you have inability and the ability to refuse is all about the share of wealth.  If you concentrate sufficient wealth at the top you give them the ability to keep it that way and refuse responsibility through application of minor amounts of that wealth to the political system.

It has taken decades to get to this point and trying to do something real about it in a sudden manner, even if possible, would have undesirable consequences to the economy.  Forcing wealth back down into the general population will take time even if it is seriously addressed.  The problem is the the will to do it will take an awful lot work and time - the thinking that has led to this mess has been inculcated over decades and become some perverted common sense.  Waiting for politicians is simply foolish, they will react to common sentiment not common sense and worse yet - that sentiment has to overcome the political advantages of wealth.  Yeah, I think most Americans should pay taxes and that involves being able to pay them and that means that the real Takers in the economy have to give up quite a lot.  A hell of a lot which is just chump change in their world.  So don't hold your breath or any stupid like that...

By the way, if you're not in the top 1% or even better 0.1% you're getting hammered by percentage of income paid in taxes compared to them.  Absolutely hammered.

Remember Capital Gains Taxes?

I hope you remember all the economy building and jobs creation that was coming from the continuous slashing of Capital Gains Taxes. You do remember? Notice any of either?

What you may have noticed is that the share of wealth held by the very top surged and everybody else lost. Well, you would have noticed if you'd paid attention. Everybody with lots of money sure noticed and paid attention - enough attention that Capital Gains Taxes are once again strangling growth...

You suckers suck so bad that you make sucking eggs look like and accomplishment.

Gee, it's not real hard to find, the IRS has all of it, just without detail on the top 0.01%ers. Somebody needs to point and laugh - I'm just having trouble doing it through all the tears.

Tax Cuts Good - Drool, Slobber

Maybe somebody ought to ask what conditions exactly need to occur where tax cuts are not the answer?

Tax cuts were wonderful for St. Ronnie and they were to pay for themselves - never happened. GWB inherited a government mostly paying for itself and the GOP figured that was a time for tax cuts. Once a war/s started happening and a hole opened up, they extended them because - well, because they're good and wars are good. When the Obama Admin looked at huge deficits and falling revenues they offered to tax the top 2% of earners and that wasn't the right GOP time because ... some horse manure about job creators.

So, when you've got money it is good to cut, when you don't have money it is a good thing to cut, and when the rich have tanked the economy it an even better time to cut. When isn't it? Taxes are at a low since 1950 and ... tax cuts. No matter their so-called Golden Years involved much more serious tax rates - that don't count. In fact, nothing that was shitty about the 1950s counts unless Truman was in office.

If you ask the Tea Party about the real numbers - you get mumble, drool, and spit flecked rhetoric. If you ask another large percentage you get .... DUH.

Other than blaming it on some sick inherited gene I can't figure out why I continue to give a damn.

Tax Bracket Stupidity

Marginal Tax Rate[3] Single Married Filing Jointly or Qualified Widow(er) Married Filing Separately Head of Household
10% $0 – $8,350 $0 – $16,700 $0 – $8,350 $0 – $11,950
15% $8,351– $33,950 $16,701 – $67,900 $8,351 – $33,950 $11,951 – $45,500
25% $33,951 – $82,250 $67,901 – $137,050 $33,951 – $68,525 $45,501 – $117,450
28% $82,251 – $171,550 $137,051 – $208,850 $68,525 – $104,425 $117,451 – $190,200
33% $171,551 – $372,950 $208,851 – $372,950 $104,426 – $186,475 $190,201 - $372,950
35% $372,951+ $372,951+ $186,476+ $372,951+

If you look at this table of Federal Tax Brackets you begin to understand how the government looks at wealth. Keep in mind that "marginal tax rates" apply only to the portion of income that exceeds the ceiling of the previous bracket. The gazillionaire pays 10% on his Adjusted Gross up to $8,350 and then he pays 15% on the amount from 8,351 on to ... etc. Once you make $372,951 you pay 35%, after all your deductions and excluding capital gains (on which you pay 15%) right up to ... well, gazillions.

Now somehow there is sufficient difference, $25,600, in incomes between 10% and 15% to justify a 5% increase in tax liability. There is no difference in income once you make $372,951, the government can't see it. As an individual you'll sure the hell see a difference in how you're treated and frankly the budget deficit sees it. If you toss the Alternative Minimum Tax into the picture you'll pretty quickly start to get some negative ideas.

Don't get me started on the idea that the SS/FICA tax with employer "contributions" at nearly 16% applied to all income up to $106,000 and nothing beyond doesn't have implications.

Which part of the fact that tax policy is not just about a budget, but also about behavior is it that misses most people? You do understand that in a given year there is a finite amount of income to be made in this year and that when some one person takes out huge amounts there is less left to go around. The fact that things like AMT and tax brackets aren't tied to median income amounts each year but rather to fixed dollar amount further states the problem.

Deficit Idiocy

Sometimes you want to smash your head into something when you hear about "popular" concerns like the deficit.

This graph of what programs people want cut versus their percentage of the budget from The Washington Independent (h/t Newshoggers) ought to create that reaction amongst everybody including the GOP. The problem is that each little bunch has their preferred devils and their angels and none of it has anything to do with reality. Can this deficit spending continue? No, it cannot and this graph makes it obvious that taxes are the only solution that the public will tolerate despite their denials.

If you're gonna Teabag this post, point out which of these you propose to affect.

Masters Of The Universe Need Friends, Too

Now I'd guess that laying any more tax on multi-billionaires than a carpenter would make no sense in the world of the Confederate Party of Republicanism. You could bring up small business, who in the face of a double hit on FICA/SS of 15.7% might scoff at the idea that a tax increase on hedge fund managers from 15% to 40% was a horrid thing.



It is funny how for this bunch anything that dings the uber-wealthy is bad for the little guy, the guy they're actually looking out for. You know, like the way the wealthy have cleaned up and everybody else watched wages flat line or go in the toilet.

What I'd like to know is how this idjit Cantor managed these lines with a straight face and the rest of the room didn't dissolve in laughter?

How Do You Limit Greed

Greed. There it is, the word that has come to define the building blocks of this current economic debacle. I have been holding forth for years that there is something obscene going on it this country with the economic structure as is. We have allowed a situation to exist where our allocation of wealth toward the top has surpassed third rate third world dictatorships. It takes the bottom half of the economic strata to make what the top one percent do, and that is, for god's sake, what the tax form says they make. Not only is the game fixed, the measuring stick that says it's this bad is fixed.

If ethical sense or the government isn't driving the compensation rates how to approach it? Be under no delusion that I have a problem with people getting rich or that I am jealous of them. What I object to is the crushing of everyone downstream in that pursuit. I am quite comfortable asserting that ethical sense has played absolutely no part in the accumulation of wealth over the last thirty years. I have no problem with the idea that government setting compensation rates is socialism and not really applicable to our system. That does not mean that we're helpless in this regard.

We have used taxes to both encourage and to discourage behavior for a very long time. What we have done for the last thirty years is encourage the accumulation of extravagant amounts of wealth, there is absolutely no downside to it. Thirty Six percent marginal rates may sound discouraging and fifteen percent capital gains may seem stiff, but we levy much more discouraging taxes on those who will never see one hundred thousand dollar incomes. Reality is a bitch and it's damn real to be not rich in this country. Sales taxes eat you on virtually all your income, FICA/SS gets you for 15.7% of all your income, state income tax eats some more, sin taxes and necessity taxes pile up and pile on, unemployment and workman's comp slide by your notice but you're paying for it. You should certainly feel for wealth and do all in your power to enable them, they'll ship your job overseas or insource it if it can't move. But you buy the game sold you, the creators of wealth, the masters of the universe need not be accountable.

There is a tool that discourages the non-disbursement of wealth and it is called taxes. With progressive rates you don't discourage creation, not unless you set the sky high marginal rates too low. You avoid that by tying them to the median income and at certain multiples you make it unreasonable to try for more. That is simply behavior modification - don't go on about targeted goals, not in the face of tobacco taxes and alcohol taxes. Don't even go there in the face of 15% capital gains taxes.

So, you think maybe now you know how you do limit greed? Now just try to get somebody to pay attention to you...

Tom Butler Tells Baker City Part Of The Story

Baker City Herald; June 12, 2007; Issue23
"Tax proposals shouldn't fly, Butler thinks
Mike Ferguson, mferguson@bakercityherald.com

Mike and I know each other pretty well and I have reason to trust his reportage, so here's Rep Butler as I derived him from Mike's report. Don't blame Mike for my stuff, I'll use quotes if anybody is getting quoted.

First up, I don't think Tom has ever seen a tax break for big business or wealthy individuals he doesn't like. Butler opposes raising the $10 corporate minimum tax, a level he admits is low, but he does want you to know that corporate filing fees have been raised 500% since the $10 minimum which began in the 1930s. Yes, 500% no doubt sounds like quite the bash on corporations - except the fee is $50. How do I know that? I pay both. Of the price to satisfy government to allow me to be in business this amounts to almost exactly 1%. Me, 1%; oh boy am I impressed.

He doesn't like the boost in weight and mile tax on trucks that operate in Oregon "The increase would make Oregon the nation's most expensive state to operate a commercial tractor-trailer, he said." Has Tom looked at the roads lately? Sure, studs are hard on the roads, but check which lane is thrashed, the right one. The truck one. Chains aren't exactly nice to roads, either. The most expensive in the nation? Let me see, deep frost penetrations, lots of mountains, lots of miles with essentially nothing there thus lots of mileage. Oh my, I pay about $240 for tags for a 1950 COE (cab over engine) 18,000 pound gross dump truck that gets the kind of miles you might expect in a year - few.

He doesn't like the additional cigarette tax, he says it would push people to Other Tobacco Products site and OTP isn't taxed. He's a non-smoker - "no friend of the tobacco industry," which I might believe. What is galling is that he uses such an argument rather than the fact that the tax will fall on a lower income group with few numbers. He is perfectly willing to make the few numbers argument for the rich, I've heard him do it. And the simple fact that these are Oregonian's children, no smokers. About 60,000 of Oregon's uninsured children are eligible for Oregon Health Plan coverage, but, "their parents just aren't signing them up." He says. ( I think the tax stinks, I smoke, but for the reasons I put forward it stinks )

I'm afraid this guy represents me, oh well...

More Money, More Money

The White House is embarrassed, not to ask for more money for Iraq, but because Congress already said they'd 'lowballed' the escalation costs. The AP Story makes it pretty clear another $2 billion or so needs to be added to the $93.4 billion requested to run the show through September.

You needn't be bothered by that number, it certainly won't cause taxes to go up, and you won't be expected to pay it. Your children will be stuck with the bill, or grand kids. At some point this mess will hit a brick wall, called interest on the debt. That's awhile down the pike, but here's the bad news, we are fast approaching the point where we will not be able to tax ourselves out of the collision. Grover Norquist may have gotten his wish to drown the system in the tub.

Minimum Sense

The House lived up to its promise and passed a nice clean minimum wage bill, raise the minimum wage, period. The Senate put one together, same idea. Well, not gonna happen that way, no siree, not in our Senate. This is the responsible outfit, the six year guys, they know better than to go off half-cocked, you gotta look it over real careful like and make some changes.

Now just exactly who has suffered from the minimum wage being stagnant for over a decade? Who is it that has benefitted from the minimum wage being stagnant for over a decade? There is a case for saying there is membership in these classes. This ought to be a part of the consideration given this matter by the Senate. Workers suffered and business gained. So the Republicans in the Senate will make sure this doesn't move forward unless business gains. Even in labor intensive agriculture, labor is the smallest single component in the cost picture. Labor costs do not become significant until you get to high cost labor which is a completely different scenario than minimum wage labor.

The Republicans want a tax credit for small business. This is laughable on two issues, the government is going broke from tax breaks and the outfits they call small business are anything but the mom and pop concerns they want you folks to think of when they say it. Tell your Senators no. Tell your Representatives no. They'll send this back to the House to reconcile the two bills, the House needs to send the clean one back, that's it, period. If the Republicans want to play stupid games, there is less than year until the Senate election games start up, they can damn well be made responsible for their crap.

More Cigarette Tax

This would be a great time to tell you what a great idea additional tax on cigarettes for children's health care is ... not. Health care for children is a great idea, over due, as is some form of universal health care. Not just great ideas, wonderfully, stupendously, awesomely great ideas. Paying for them with additional cigarette taxes is errant nonsense. These are Oregonian's children, not cigarette smokers' children. On a pack of Camel straights @ $5.00 the tax is 24% of the cost, that's not the tax rate which is 31% and that is on top of the federal taxes. I mention Camel straights because I smoke 1/2 pack/day of them.

I make no claim that cigarettes aren't bad for your health, they absolutely are. There are some real basic problems with some of the claims, but that's small change. It cannot be shown that those costs are not recovered over time, there certainly are some issues about aging vs not that get lost. Even that is not the point. The point is that cigarette smoking has not squat to do with child health care. Yes, you can impose that tax by vote on a minority that hasn't enough votes to challenge it, because you can do something does not make it right or reasonable. It might not bother anybody that most smokers make less than the median income, but it sure seems an odd way to be progressive.

People make "fairness" claims about the social and health costs posed by cigarette smokers, as though voluntary choices like that only include smoking. Maybe those advocates would be well paid to take a look at the consumption of alcohol when they bring up those kinds of costs. It does pose a bit of a problem for the cigarette agenda, smoking pales in comparison. The single greatest hit in those costs is ... alcohol. Yes, there's an elephant in the living room and nobody notices. As far as personal health goes try on liver damage, brain cell death, nerve damage, esophagus and stomach damage, lowered immune system, circulatory damage, and pregnancy issues, then move onto mental health issues, including verbal and emotional components, neglect, irresponsible behaviors . From there add in car crashes, falls, assaults, lost work days. Then go take a look at the prison system and find how many crimes were committed under the influence. This stuff is advertised on TV and in magazines and its use is glorified, yes, in front of children. What works for alcohol is much better lobbying and advertising and a much larger constituency.

*Further disclosure* I don't drink, I haven't for almost 19 years, I do know something about it.

Do I want to duck responsibility for my smoking habit? No. I've smoked for over 35 years, though, and I'm healthier than the majority of the population and you'd better be in outstanding condition if you want to keep up with me. Since I can't afford to retire you don't need to worry about taking care of me in old age, besides I like my work.

If we're going to take on progressive ideas and institute policies on those ideas, let's do that exactly, do progressive things in a progressive manner. I'm sorry Gov. K. this idea sucks, but I voted for you and still would.

Blue Oregon is having a nice argument and they even have a poll. I don't like the idea over there either.

Casey Jones...Better Look Out...Blow Your Horn

There's a train wreck ahead, six years of BushCo neglect and a bit more of other's and we've got some problems that don't have good solutions. When you let things go on for too long the consequences keep building up and multiplying until however you deal with them, it hurts.

We've been stupid in Iraq until we now are caught in the middle of a civil war in a disintegrating country. We can stay and bleed and help Iraqis blow their country up or we can leave and watch them blow it up. Either way, the standing, reputation, and honor of the US is blasted and people and soldiers become casualties of meaninglessness. Probably the only two questions unanswered are how many American casualties and which Party gets blamed. Well, there's money, too.

Illegal immigration has become an issue with no good solution - in massive terms. The utter indifference of the US government has led to a situation where there are 12-20 million people in this country with no business being here. Wages have become dislocated, education is over-stressed, social services are hammered, the tax structure is a joke, organized and disorganized criminal behavior is rampant, employers are criminals and the legal ones are losing their butts. Somewhere around 6% of the population is a disenfranchised criminal serf class and that class has citizen children. It no longer makes any difference what solution is applied, someone is going to get hugely screwed and most solutions only encourage the problem.

The US debt, here's cause for real tears. The United States of America is not only broke, it's bankrupt if anybody flinches. There's no money for the programs that exist, much less adding new ones, there just plain isn't the income to cover the interest and run all our existing programs. This debt is so huge that if the Iraq war ended at New Years and you taxed the wealthy to the point of confiscatory taxes there still wouldn't be money. If you sunk the tax shovel deep into corporate soil there isn't money. Even driving down to poverty level income with harsh taxes won't do it. Going to the point of pain for earners above poverty will only start a turn around if there's fiscal sense in Congress. BushCo has guaranteed that a progressive social agenda is unaffordable and at some point taxes become economic disincentives. Then there's the Veto and the "tax and spend Democrats" label to be avoided.

Reasonable health care? See above. All three mean there's no escape from the status-quo slide, the Fed has huge liabilities for war casualties, there are 12-20 million serfs, and we're broke, anyhow.

Folks, the wheels are coming off, we're running out of track, and there's no nerve anywhere to deal with it. Casey, blow your horn...

The Working Poor and the Poor, Poor Pitiful Rich

OK, working poor, you can have your raise in the Federal Minimum Wage, just as long as the downtrodden rich folk get an Estate Tax break. Think this mess will pass? "I (Republican Representative X) voted for the Minimum Wage Increase Bill, so this certainly shouldn't be an election issue..."

Do you suppose the electorate is as stupid as they seem to think? Aw, c'mon, they don't think we're stupid ... Gay Marriage...Flag Burning...Terry Schiavo...Stem Cells...

Well, Iraq.

How much of a plan do the Democrats have to have? "We can do better together" might be enough.

Sen Wyden's Flat Tax Proposal

Sen. Ron Wyden D-OR has a tax proposal I find interesting and a good shot at addressing the inequities in the present system. This proposal reduces the Brackets to 3, treats all income the same, and preserves the useful and important deductions while reducing the deficit by $100 Billion in 5 years. As an elected Representative I would be in a position to help him bring this proposal into being and willing to put real energy into the issue. I applaud him and I hope you will let him know of your support.

http://wyden.senate.gov