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Obama Announcing New Tax - 'The Buffett Rule' Tax.

Discussion in 'Political Discussion' started by IcyPatriot, Sep 18, 2011.

  1. IcyPatriot

    IcyPatriot ------------- PatsFans.com Supporter

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    #87 Jersey

    Should be a fun week when this gets announced. in fairness it seems like a reasonable tax - investment income should be taxed the same as earning income. This tax will insure the higher wage earners at least pay the same level of tax as the middle class people. I also believe more people should pay taxes even if it's merely a 5% rate. The tax breaks over the last decade or so have hurt our deficit more than any corporate taxes. I need to find that article and post it also.

    News from The Associated Press

  2. IcyPatriot

    IcyPatriot ------------- PatsFans.com Supporter

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    #87 Jersey

    Here is the other article that perhaps goes with the one above ... a good read.

    Ever-increasing tax breaks for U.S. families eclipse benefits for special interests - The Washington Post

  3. Wolfpack

    Wolfpack Banned

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    Uh, no it shouldn't.

    Great idea, crackhead. Raise tax on the people who create jobs by investing.
  4. Ilikehappyppl

    Ilikehappyppl Rookie

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    So where are the jobs then???:bricks:Since the tax rate is low atm?


    That's what I thought, you could lower there taxes to 0% and it wouldn't change a thing, greed is greed and sheep are sheep.......;)


    Edit:Also no need to be rude to others and call them names cause they disagree with you,or share a different opinion.
    Last edited: Sep 18, 2011
  5. chicowalker

    chicowalker On the Roster

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    Actually, he's only capable of being rude and calling people names when they disagree with him.
  6. Wolfpack

    Wolfpack Banned

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    The economy is in the crapper right now, no doubt, thanks in large part to B. Hussein Obama. But that doesn't mean that the solution is to discourage investment.
    No no, that "crackhead" remark is in reference to Obama, not IcyPatriot.
  7. Ilikehappyppl

    Ilikehappyppl Rookie

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    I agree don't discourage investment but I think you have to kinda force some peoples hand, what I mean is, let's say you invest a ton of money in the system that should give you a big tax break, now lets say you invest very little and hold onto you money, you should have to pay more taxes for being greedy and just holding onto money, being rich is a responsibility I know some people don't like that POV but it is what it is.

    We need to encourage people to spend, and the best way to encourage them is to either take there money when they choose to sit on it or scare them by threatening to take there money in the from of taxes. As of right now the top 5% have more money then they have ever had in any generation and they are just sitting on it, think of all the wonderful things we could be doing if you would invest there money! The rich have to understand they are the key to all this, when they decide to step up and be leaders the rest will follow suit, rest assured.

    I don't agree with raising the capital gains tax, I do however would like to see income tax go up instead unless they invest more money, then there tax rate could go down depending on how much they invest.

    Sry my bad for misunderstanding.
  8. Nikolai

    Nikolai Football Atheist PatsFans.com Supporter

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    #54 Jersey

    Yeah, I'm not getting how discouraging investment is going to help things, but I'm just a schlub on a message board.

    If you want to use the government to encourage investment (the wisdom of which is up for debate), raise non-investment taxes.
  9. PatsFanInVa

    PatsFanInVa PatsFans.com Supporter PatsFans.com Supporter

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    Nic, a few things -

    1) the "AMT for millionaires" isn't the capital gains tax... Icy did reference that second part and indeed income realized from cap. gains might be included in the gross income figure (i.e., income independent of source.) But this is not an across-the-board capital gains tax increase so it approaches what you pay for money you make by working.

    2) The idea that taxing capital gains unquestionably discourages investing is dependent on the premise that people mainly put new money into capitalizing markets. Now remember, we're over on the "supply side" to start with... but the market (as the figures from the DOW and S&P display,) while not exploding, has sufficient liquidity and has recovered a good chunk of what it's lost. A tax on realized gains -- i.e., taking money off the table -- will encourage money in that species of investment to remain there once invested.

    3) Per (2), if I have 70% of my portfolio in traditional equities (the stock market) do I really rebalance to 70% alternatives (real estate), cash and equivalents, commodities, metals, whatever? Do I really believe my return on equities won't make up that difference in realized gains over time? For that matter, if I have a million bucks in gold, and liquidate it to turn it into cash then not re-invest it, don't I have to pay the cap. gains tax on that just like capital gains on equities? I don't actually have this answer, but it would be one solution to your objection: if you have to pay that tax regardless of which asset class we're talking about, unless it's re-invested within a year (I believe that's the test for capital gains,) doesn't it only apply to money that is pulled out of the economy to buy the monopoly guy a new monocle?

    Just thinking out loud here. A lot would depend on the tax rates for the same transactions internationally. Perhaps capital would flee to Europe (ahem) or to China, assuming both regions have less "threatening" climates for the same transactions. It does seem to me, however, that while China is already a place where our jobs end up, by the mechanism of offshoring, the American citizen investing in a Chinese company would still have to pay his millionaire's tax in America, unless living abroad.

    It would seem that by taxing the individual realizing the capital gain, you're able to "do the damage" domestically, because whereas a corporate tax affects an entity that can suddenly flee the country (a somewhat overstated effect,) a tax on citizens would mean that individuals would have to make a decision to emigrate with their millions or billions, and forego their local restaurants, stores, friends, and identity, to evade the tax.

    I don't fool myself that there aren't some millionaires that are craven enough to exile themselves for the sake of some difference in marginal return on money, I do think there are counter-incentives on the individual side that more than make up for that risk.

    To posit otherwise is to throw up our hands and admit that we can never have a progressive system of taxation -- which we do, in fact, have. That's the whole nut of the "rich should pay their share" argument. While the marginal rate on earnings is slightly higher than among the teeming maggotry like ourselves, the rate on unearned income (i.e. investment income) is lower than the lowest bracket among working people, and that's where the rich make their real money.

    So an AMT among millionaires and billionaires would institute progressive taxation on the individuals to whom all the advances in wealth and income have redounded over the last generation.

    The question is whether, as a class, the wealthy will simply throw up their hands, declare "Game over, Man!", and move to Barbados or somewhere.

    PFnV
    Last edited: Sep 19, 2011
  10. DarrylS

    DarrylS PatsFans.com Supporter PatsFans.com Supporter

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    Everyone wants to talk about Ponzi Schemes the tax cuts by Bush were supposed to enhance economic growth by reinvesting in America, the only thing that happened was that the rich got richer and the rest of us watch.

    Bush started the "class war" on america, by only giving out tax cuts for the rich (preemptively will acknowledge the kneejerk response of PF 13 that there were miniscule tax cuts for the rest of us)... but something is very wrong with a tax code that allows for over 1400 millionaires not to pay taxes.. and for most of us to pay a higher percentage of taxes of the uber rich.
  11. PatriotsReign

    PatriotsReign On the Roster

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    I wouldn't want to see any tax increase on our middle class since our middle class has been beaten into the ground more than any other income group.

    Make employers pay taxes on $$ used to pay employees health insurance premiums and the cost for health insurance will be passed on to employees. Remove the mortgage interest deduction and you'll essentially reduce home owner's income significantly.

    My question is why are people even discussing increasing taxes on our middle class when it's out of the question? Obama PROMISED not to raise taxes on the middle class, didn't he?
  12. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

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    401Ks fundamentally changed the nature of investments to the benefit of the wealthy and the detriment of the middle class (who fared better with pensions). There is no risk of discouraging investment as long as investment is seen as yielding a better return than savings. Investment has steadily increased since at least the early 1960s, despite capital gains at times being higher than it currently is. There are many ways to promote investment (such as 401Ks). The principal investors are not heavily influenced by capital gains (as long as they stay reasonable), in my opinion. Certainly, Warren Buffet seems to agree, and he would be one who is in the know.
    Last edited: Sep 19, 2011
  13. PatriotsReign

    PatriotsReign On the Roster

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    Our wealthy class have never created any jobs...never have and never will.

    Jobs are never created because business owners have more money/capital. They are only created due to increased demand.

    The only thing that creates jobs is increased demand for goods and services. And that means an increase in consumption. Since our middle class generates the vast majority of consumption, they are in fact the "job creators".

    So if we have the choice of putting more money in the hands of the middle class or the wealthy, we should choose the middle class every single time, without exception.
    Last edited: Sep 19, 2011
  14. PatriotsReign

    PatriotsReign On the Roster

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    I think the bottom-line here is that no wealthy American should ever pay a smaller percentage of their income as a middle class American.

    I absolutely agree with that contention...I don't see why anyone could or would disagree.
  15. Harry Boy

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    Does anybody else find it disgusting to see how those Pigs we elect as our leaders spend that Tax Money including the Rat Bastards we elect as presidents.

    I think Buffett should immediatly donate several BILLION dollars of his own money to get the ball rolling, I would also like to see Barack & Lovely Michelle grab a COUPLE of planes and go on another nice vacation they deserve it poor Jug Ears is turning grey and Chellie is all f-cked up wondering why the people are all still eating French Fried Potatoes, she has suddenly realized nobody gives a sh!t what she has to say.

    Was Uncle Jeremiah Right when he said "God Damn America"

    Bring on the Bible Thumpers and the Flag wavers (Perry & Tea Party) give them a shot at it nothing could be worse than the gang of vile vermin rats we now have.

    :mad:
    Last edited: Sep 19, 2011
  16. sdaniels7114

    sdaniels7114 Rookie

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    If you ranked the people of the USA from richest to poorest and then redistributed all the money from the rich to the poor, IE Bill Gates was made broke and some bum from Detroit became a billionaire, in about 10 years things would be right back to where they were. Rich people find their way to wealth and that's it. While they're finding their way to wealth they do things like make railroads, invent airplanes and cell phones, cure disease... the list goes on and on. I'd speculate that we'd have already cured cancer and that everyone would be driving a flying car if we'd have never dropped those confiscatory tax rates from the 50's
  17. khayos

    khayos Rookie

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    Or, the people who received that money would spend like drunken sailors having fiscally mismanaged themselves already and then after 10 years they'd be in even worse straights with the value of assets collapsing as they'd been overvalued and we'd have a whole new class of poverty without any route to redemption.
  18. Harry Boy

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    I think they have already found a cure for Cancer "Cancer Is Big Business" and they aren't going to blow it like they did with The Polio Vaccine, the day after Jonas Salk announced he found the Cure for Polio the money stopped flowing and the Big Shots in the Polio Businsess were out on the street, the scum bags we have running these things today aren't about to let that happen again.
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    Last edited: Sep 19, 2011
  19. Real World

    Real World Moderator Staff Member

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    Investment earnings shouldn't be taxed at income rates. Investment earnings usually come from previously taxed dollars, and always come with risk. What I do feel though, is that the 15% tax rate on capital gains is too low a figure. I think a two tiered CG rate of 20% on the first $X of earnings, and a 25% rate on all BG earnings thereafter, would be a fairer rate. You don't want to discourage investment, by penalizing those who take risks. Payroll income doesn't come with the same risk associated with investments. I think it's usually the people who don't have investments, that think investment earnings should be taxed at payroll rates.

    I'm not sure where I'd peg the 20% tier, but I would make it a small sum, aimed strictly at lower to middle income earning investors. So 20% on the first $5,000, or maybe $10,000 dollars of earnings. That would help the moms and pops of the world who invest in a stock, property, or what have you. We want the smaller earner to be encouraged and better protected. The 25% rate would be for everything beyong that. Currently I think the rate is 15% which seems far too low imo.
  20. chicowalker

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    Your proposal is one reasonable alternative, but in an ideal world I think investment income should be taxed at the same rate as ordinary income.

    Yes, the income was already taxed usually, but that money isn't being taxed at all -- only the gains are.

    I also don't think the risk factor should matter -- the government shouldn't be playing favorites or adjusting tax rates depending on risk profiles -- that is factored into the investment decision.

    Like many things, maybe now isn't the right time to set all income equal, and maybe it should be phased in over time, but I don't see why the low income earner living paycheck to paycheck should be taxed at a higher rate than the company owner she works for. (And I say this as somebody who owns companies.)

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