Author Topic: Boehner: We're ready to be led on taxes  (Read 3931 times)

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Re: Boehner: We're ready to be led on taxes
« Reply #75 on: November 14, 2012, 03:25:40 PM »

Offline Interceptor

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I don't see how you consumption as less desired behavior than forming companies.
Companies are ostensibly creating wealth, which makes us all richer. That's my feeling on it. We do have to fund society somehow, so I figure consumption as the person without a chair when the music stops.

Re: Boehner: We're ready to be led on taxes
« Reply #76 on: November 14, 2012, 03:32:19 PM »

Offline kozlodoev

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It makes no difference to people that were going to hire anyway; they already needed the hire for something.
It does. It lowers the marginal cost of adding an unit of labor for everyone, therefore it makes firms who were already looking to hire likely to hire more workers.

The only straight-up benefit is to people who wouldn't hire otherwise.
The biggest straight-up benefit is to people who were previously unemployed, since going from zero income to full salary income certainly dwarfs the profit gain of a regular profit-maximizing, cost-minimizing firm.
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Re: Boehner: We're ready to be led on taxes
« Reply #77 on: November 14, 2012, 03:33:11 PM »

Offline crownsy

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That's done though, through sales tax, property tax (which essential taxes you for consuming the land your property is located on), ect.
So tax it more. I'm fine with that.

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Also It could trigger a flight from cash. If people were taxed on what they consumed, how long before companies structured compensation not around cash, but benifits?
They already do that. The ludicrous notion that employer-provided health care is pre-tax, has given us our silly HC system. It's something that will need to be dealt with.

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Valuation and Liquidation would become a problem quite quickly too. Cash is easy to track and report. Consumption, not so much unless it's done at point of sale, which most states already impose a tax on.
VAT handles this by taxing the entire supply chain.

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It's also such a tough sell to people, Would people accept "hey, there's no income tax, but to make it up, 20% tax on all purchases in addition to your state income tax"
I technically didn't say to get rid of income tax, but yes.

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Conceptually I'm not opposed though. but as a practical matter i think Vertical and Horizantal fairness concerns, valuation problems, and implementing it in the first place mean we'll never see it.
I have a feeling that circumstances of getting our finances in order as a country, may ultimately result in this. We could do something else -- I don't have a crystal ball -- but this is something that works elsewhere.

Sure, In much smaller economies. Scale matters, both for fairness and tracking concerns.

Also I'm still not sure how you sell this to the average voter, doubly so if your not going to replace the income tax.

How do you balance fairness across statelines, for example? A mere 3-5% diffrence is currently driving population curves to diffrent states, and now certain states (if we're assuming we need to replace the lowest tax bracket and expand the base) will have a 15% consumption tax added on and that just accounts for the lowest tax bracket, not FICA or SS taxes. To replicate them your talking 22% tax on consumption or so.

So lets say your a Massachussets representitive. You know, mathmaticaly, that 22%+6.25%, combined with the repeal of the federal income tax (lets say for sake of numbers) actually works out better for your state's tax base than seperate Tax rate bands.

Can you imagine selling that to the average voter?

"hey, just because you are now going to pay 26 dollars in sales tax Per 100 spent, I'm actually lowering your taxes!"

People would never buy it. And any high income tax payer who consumes at a higher rate will be revolt.

Nevermind, people would Flee to states with no sales tax, or states would be forced to give up thier own consumption revenue to keep resident's and buisnesses local.

Again, I'm not 100% opposed to the theortical IDEA of a consumption Tax, but i think the implementation problems would be huge.
 

Also: how would you track non-retail cash sales? wouldn't a high consumption tax increase black market activity?
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Re: Boehner: We're ready to be led on taxes
« Reply #78 on: November 14, 2012, 03:33:14 PM »

Offline nickagneta

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Not really. The issue at hand here is getting a bunch of people without jobs hired, so in this sense you're not concerned much about companies maintaining payroll and folks that are already hired.

Of course, I don't see this being a sustainable long-run solution, since those people have to _stay_ hired, but there's no doubt that it's not less focused than building a bridge (after the bridge is built, you're exactly where you started; except you have a bridge as opposed whatever the free marked decided to produce; pretty much a lateral move).
But this isn't just a tax break, it's a tax break to counteract a tax hike. Taxes are putting downward pressure on actors that are impacted by them, but who can't take advantage of the hiring deduction because they aren't hiring anyone. It makes no difference to people that were going to hire anyway; they already needed the hire for something. The only straight-up benefit is to people who wouldn't hire otherwise.

I don't see how this isn't inferior to something like a bridge. We have lots of unemployed people, particularly in the construction sector. Not only does employing the unemployed to do something (that needs to be done anyway, in most cases) reduce unemployment, but it puts money in the pockets of people who are going to spend it in the real economy, so now we have multiplier effects in play.

So sure, I consider it better than nothing, but I think it's an inefficient use of funds.
I think you are underplaying the fact that there might be a lot of companies on the bubble of hiring someone and that the tax break could be the deciding factor in quickening that decision to hire or expand or possibly generate a decision to hire two people rather than one or many people rather than a few.

Also, the general outlay of the tax break to the company is probably offset by an increase SS tax revenue, increased payroll tax revenue, a lessening of unemployment insurance benefits paid out by the federal government(possibly, hopefully) and a new employee that may now have more income and more disposable income to spend in the economy.

All in all I see it as a good way to promote American job creation and grow the economy faster than just waiting for a company to hire people without any benefit other than the one they expected.

Re: Boehner: We're ready to be led on taxes
« Reply #79 on: November 14, 2012, 05:05:33 PM »

Offline Neurotic Guy

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I think Boehner will be extremely smart politically and will set up a great next couple of years for his new congress if he not only appears reasonable heading into negotiations, but comes out strong if/when his caucus (and Tea Party) again assume a blocking posture. 

Boehner will win widespread support going toe-to-toe with the Tea Party if he and the Pres negotiate a reasonable deal.  In fact, I wouldn't be shocked if Boehner actually wants that type of fight -- it will establish him as a strong and pragmatic leader and will boost confidence in the new congress.  Will be great for America.

Re: Boehner: We're ready to be led on taxes
« Reply #80 on: November 14, 2012, 05:15:52 PM »

Offline Interceptor

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Can you imagine selling that to the average voter?
I never said it would be easy...

I think you are underplaying the fact that there might be a lot of companies on the bubble of hiring someone and that the tax break could be the deciding factor in quickening that decision to hire or expand or possibly generate a decision to hire two people rather than one or many people rather than a few.
That would have to be a serious tax incentive. Labor is expensive.

I think Boehner will be extremely smart politically and will set up a great next couple of years for his new congress if he not only appears reasonable heading into negotiations, but comes out strong if/when his caucus (and Tea Party) again assume a blocking posture. 

Boehner will win widespread support going toe-to-toe with the Tea Party if he and the Pres negotiate a reasonable deal.  In fact, I wouldn't be shocked if Boehner actually wants that type of fight -- it will establish him as a strong and pragmatic leader and will boost confidence in the new congress.  Will be great for America.
Boehner wants a deal, you'd better believe it. It is not his natural inclination to be a roadblock. But he also wants to keep his job.

Re: Boehner: We're ready to be led on taxes
« Reply #81 on: November 14, 2012, 05:45:52 PM »

Offline D.o.s.

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Fun fact:

The reduction in top tax rates appears to be uncorrelated with saving, investment, and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie. However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution.

Via the CRC.
http://www.ombwatch.org/files/budget/pdf/CRS-Taxes_and_the_EconomyAn_Economic_Analysis_of_the_Top_Tax_Rates_Since_1945-R42729_-09-14-2012.pdf

But, you know, it would be a shame to bring facts, or research, into a discussion that seems to be rooted in that famously incorrect phenomenon known as Common Sense.
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Can't read the entire thread but cone people.

Re: Boehner: We're ready to be led on taxes
« Reply #82 on: November 14, 2012, 05:47:20 PM »

Online BudweiserCeltic

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I don't think it's efficient to simply give breaks for "new hires", but a system that is in place that considers size of company, revenue, and put some sorts of limits depending on some of this factors works.

I tell you right now, my company is quite eager to hire more workers, as it is we have to make due with what we have. If some incentive gets put in place that would offset the labor cost of additional workers, we could hire 10 more people for example, cut down on overtime to finish up work, and in the end help you run a more efficient and productive company.

But there has to be a threshold of some form. I think this would be an awesome idea at least to extend to small businesses.

Re: Boehner: We're ready to be led on taxes
« Reply #83 on: November 14, 2012, 05:54:47 PM »

Offline foulweatherfan

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Fun fact:

The reduction in top tax rates appears to be uncorrelated with saving, investment, and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie. However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution.

Via the CRC.
http://www.ombwatch.org/files/budget/pdf/CRS-Taxes_and_the_EconomyAn_Economic_Analysis_of_the_Top_Tax_Rates_Since_1945-R42729_-09-14-2012.pdf

But, you know, it would be a shame to bring facts, or research, into a discussion that seems to be rooted in that famously incorrect phenomenon known as Common Sense.

Yeah, that study came up in a different thread awhile back.  While it seems like a pretty devastating blow for commonly held right-wing beliefs on the impact of upper-income tax rates, unfortunately it turns out that it is actually Teh Bias, for reasons to be determined later or constructed on the fly.

Re: Boehner: We're ready to be led on taxes
« Reply #84 on: November 14, 2012, 05:58:56 PM »

Offline foulweatherfan

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That study aside, I am optimistic about Boehner working with the President this time - he was willing to do it last time around, but got squelched by the Tea Party faction. 

Now, he can simultaneously gain some significant political capital, start the process of realigning the GOP with the broader electorate, secure a more positive legacy as Speaker, and push back against a faction that mostly prefers the guy angling for his job (Cantor), all in one fell swoop.  And again, the default is that the tax cuts expire anyway, just more broadly than either side wants. 

He won't want to look buddy-buddy with Obama, but he'll play ball I think - too much to lose by not doing so.

Re: Boehner: We're ready to be led on taxes
« Reply #85 on: November 14, 2012, 05:59:34 PM »

Online LooseCannon

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Boehner will win widespread support going toe-to-toe with the Tea Party if he and the Pres negotiate a reasonable deal.  In fact, I wouldn't be shocked if Boehner actually wants that type of fight -- it will establish him as a strong and pragmatic leader and will boost confidence in the new congress.  Will be great for America.

Based on past history, I can't see Boehner fighting hard for a bill that a majority of House Republicans will vote against.  A reasonable, pragmatic compromise would probably be all Democrats plus 30-40 Republicans in the House, if you can find 30-40 Republicans willing to compromise on a moderate bill.  I just can't see Boehner leading that moderate faction that probably doesn't exist.
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Re: Boehner: We're ready to be led on taxes
« Reply #86 on: November 14, 2012, 06:02:39 PM »

Offline D.o.s.

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Fun fact:

The reduction in top tax rates appears to be uncorrelated with saving, investment, and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie. However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution.

Via the CRC.
http://www.ombwatch.org/files/budget/pdf/CRS-Taxes_and_the_EconomyAn_Economic_Analysis_of_the_Top_Tax_Rates_Since_1945-R42729_-09-14-2012.pdf

But, you know, it would be a shame to bring facts, or research, into a discussion that seems to be rooted in that famously incorrect phenomenon known as Common Sense.

Yeah, that study came up in a different thread awhile back.  While it seems like a pretty devastating blow for commonly held right-wing beliefs on the impact of upper-income tax rates, unfortunately it turns out that it is actually Teh Bias, for reasons to be determined later or constructed on the fly.

Oh. My bad.

It will definitely be interesting to see the GOP rebranding efforts between now and 2016, since they seem to have realized that curmudgeonly old white dudes (and the women who love them) don't win elections anymore.
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Can't read the entire thread but cone people.

Re: Boehner: We're ready to be led on taxes
« Reply #87 on: November 14, 2012, 06:06:11 PM »

Offline BballTim

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Fun fact:

The reduction in top tax rates appears to be uncorrelated with saving, investment, and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie. However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution.

Via the CRC.
http://www.ombwatch.org/files/budget/pdf/CRS-Taxes_and_the_EconomyAn_Economic_Analysis_of_the_Top_Tax_Rates_Since_1945-R42729_-09-14-2012.pdf

But, you know, it would be a shame to bring facts, or research, into a discussion that seems to be rooted in that famously incorrect phenomenon known as Common Sense.

  Haha. That would make a great slogan, "ignore your common sense and believe whatever study I can find that supports my argument".

Re: Boehner: We're ready to be led on taxes
« Reply #88 on: November 14, 2012, 06:11:47 PM »

Offline Neurotic Guy

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Fun fact:

The reduction in top tax rates appears to be uncorrelated with saving, investment, and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie. However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution.

Via the CRC.
http://www.ombwatch.org/files/budget/pdf/CRS-Taxes_and_the_EconomyAn_Economic_Analysis_of_the_Top_Tax_Rates_Since_1945-R42729_-09-14-2012.pdf

But, you know, it would be a shame to bring facts, or research, into a discussion that seems to be rooted in that famously incorrect phenomenon known as Common Sense.

  Haha. That would make a great slogan, "ignore your common sense and believe whatever study I can find that supports my argument".

I would be hesitant to ignore EITHER common sense or studies done by non-partisan, highly regarded congressional support services.   It would seem that common sense would support the notion that you neither blindly accept nor reject such information.

Re: Boehner: We're ready to be led on taxes
« Reply #89 on: November 14, 2012, 06:18:24 PM »

Offline nickagneta

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Fun fact:

The reduction in top tax rates appears to be uncorrelated with saving, investment, and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie. However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution.

Via the CRC.
http://www.ombwatch.org/files/budget/pdf/CRS-Taxes_and_the_EconomyAn_Economic_Analysis_of_the_Top_Tax_Rates_Since_1945-R42729_-09-14-2012.pdf

But, you know, it would be a shame to bring facts, or research, into a discussion that seems to be rooted in that famously incorrect phenomenon known as Common Sense.

  Haha. That would make a great slogan, "ignore your common sense and believe whatever study I can find that supports my argument".
Another good slogan could be  "let me arbitrarily disregard good studies simply because I want to listen to the propaganda I have been fed for years"....both sound like good slogans.

 

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