CBO: Top 40% paid 106% of income taxes...

[Oklahomahawk]

We've been over this before. People who don't pay personal federal income tax still pay payroll, sales, and state income taxes. Their tax burden is hardly "nothing."

Just so I am clear on this, as I don't normally get involved in serious economics discussions but normally discussions that are more "socio-economic trends", sturg, does the term you used "free loaders" apply to the wealthy freeloaders who hide much of their income in offshore accounts, etc. or does it only apply to the poor freeloaders, whether they are truly just lazy jagoffs or really are trying and legitimate victims of an ever increasingly effed up system?

[50PoundHead]

Well thanks for the number, but holy ****.

So, someone makes $400K… You want to start by taking $280K of that? That's before state, local, sales, excise, social security, medicare taxes, etc.

Would that type of a tax rate result in a tax cut for everyone else? Or is that in addition to the current revenues? Is there ever a plan to CUT spending?

I think someone else pointed it out, but the marginal rate is only applied to the increment of income affected, not the entire income. In other words, the first $X of income would be taxed at a given percentage, the second increment above $X would be taxed at the next highest rate, and so on. The marginal rate reductions (the highest I remember was 90% and it wasn't because my parents were paying it) were accompanied by a broadening of the tax base in the 1980s so lower rates were assessed against incomes that weren't reduced as much for tax purposes. A lot of folks here are too young to remember, but you used to be able to write off interest on your credit cards up until the 1986 changes. Pretty much the only interest you can write off now is first/second mortgages and interest paid if you run your own business. You could also deduct sales taxes paid to your state.

[weso1]

I think the current income tax rates are fine. I actually think most liberals would be just fine with 36-39%. I think the question really should be what should the cap gain tax rates be and the like and what should the tax shelters be? Unfortunately there isn't a simple answer. I understand everyone wants fairness, but fairness isn't necessarily the best thing for the economy and thus the best for the country as a whole. Liberals get way too caught up in their contempt for rich people in this argument. The argument always gets turned into the big bad evil rich people, when it really shouldn't be about that.

[Julio3000]

I think the current income tax rates are fine. I actually think most liberals would be just fine with 36-39%. I think the question really should be what should the cap gain tax rates be and the like and what should the tax shelters be? Unfortunately there isn't a simple answer. I understand everyone wants fairness, but fairness isn't necessarily the best thing for the economy and thus the best for the country as a whole. Liberals get way too caught up in their contempt for rich people in this argument. The argument always gets turned into the big bad evil rich people, when it really shouldn't be about that.

The wealthiest Americans are paying historically low tax rates. Many of us believe that should be changed, and the equation be balanced as it was before. That's not punishing the rich, or bringing morality into the equation at all.

[weso1]

The wealthiest Americans are paying historically low tax rates. Many of us believe that should be changed, and the equation be balanced as it was before. That's not punishing the rich, or bringing morality into the equation at all.

I'm just saying that it might not necessarily be the smartest thing to do. It's not as simple as some make it out to be.

[sturg33]

Wasn't it Obama, who was asked why he would raise capital gains when history concluded it that economic conditions got better when they were lower… He said he didn't care, that he would do it out of fairness?

[BedellBrave]

The wealthiest Americans are paying historically low tax rates. Many of us believe that should be changed, and the equation be balanced as it was before. That's not punishing the rich, or bringing morality into the equation at all.

"Should" is a moral term in this case. "The wealthiest Americans should pay a higher rate" is a moral statement, expressing a moral standard. Not saying it is wrong. But let's not think it is morally neutral.

[zitothebrave]

Wasn't it Obama, who was asked why he would raise capital gains when history concluded it that economic conditions got better when they were lower… He said he didn't care, that he would do it out of fairness?

I feel like this statement is made often without looking at historical context. You know with your certainty, you'd think that the economy would have exploded when the cap dropped in 2003.

[Metaphysicist]

Wasn't it Obama, who was asked why he would raise capital gains when history concluded it that economic conditions got better when they were lower… He said he didn't care, that he would do it out of fairness?

That definitely sounds like a direct quote.

[Julio3000]

Wasn't it Obama, who was asked why he would raise capital gains when history concluded it that economic conditions got better when they were lower… He said he didn't care, that he would do it out of fairness?

History concludes that?

[sturg33]

That definitely sounds like a direct quote.

Considering I did quote him, no it wasn't a direct quote. Thanks.

Here is the direct quote.

[Metaphysicist]

Considering I did quote him, no it wasn't a direct quote. Thanks.

Thanks for clarifying.

[Julio3000]

So, sturg, does history conclude that?

[sturg33]

So, sturg, does history conclude that?

The one time the capital gains tax rate was increased since 1981 was in 1987, from 20% to 28%. From 1987-90, capital gains revenue fell from $33.7 billion to $27.8 billion, with an average annual decline of -12.8%.

Capital gains tax rates were cut from 28% to 20% in 1981, again from 28% to 20% in 1997, and from 20% to 15% in 2003. Capital gains tax revenues grew by an annual average of 15.8% from 1981-84, 17.8% from 1997-2000, and 25.5% from 2003-06.

But hey, then it wouldn't be fair.

[zitothebrave]

And the increased capital gains increases of 97and 2003 sure have helped make the the economy so much better today. Lulz.

[sturg33]

And the increased capital gains increases of 97and 2003 sure have helped make the the economy so much better today. Lulz.

Is this a serious post?

Tax revenues went UP when rates went DOWN. That means that the investments were much more successful and/or there were a lot more investments made.

[zitothebrave]

So you think the economy today is the best in the history of America? Lulz.

[sturg33]

So you think the economy today is the best in the history of America? Lulz.

No I don't think that all... But if you want them paying more taxes, that's exactly what happened.

It literally is impossible to please you people. When actual data shows that rich people paid more taxes, that's still not good enough for you.

Do you think less investments are good for the economy? Do you understand why the economy sucks right now? It has nothing to do with frickin capital gains taxes.

[zitothebrave]

I think that the investor class is the problem with the economy now. Yes. Not all of them of course. But all the investor class is out there to do is to make money on the backs of other companies. And then ditch those companies.

For example, Carl Icahn wants Apple to buyback a healthy chunk of their stock, the only people that benefits are the people with tons of stock in Apple. Doesn't help Apple or their employees, just the richest. If Apple took their cash and invested it in the company that benefits Apple and their employees it works out for everyone but the evestros. That's what needs to happen, not the foolish stock buy back that's what ultimately led Blackberry to their doom.

[sturg33]

I think that the investor class is the problem with the economy now. Yes. Not all of them of course. But all the investor class is out there to do is to make money on the backs of other companies. And then ditch those companies.

For example, Carl Icahn wants Apple to buyback a healthy chunk of their stock, the only people that benefits are the people with tons of stock in Apple. Doesn't help Apple or their employees, just the richest. If Apple took their cash and invested it in the company that benefits Apple and their employees it works out for everyone but the evestros. That's what needs to happen, not the foolish stock buy back that's what ultimately led Blackberry to their doom.

So you don't want private companies to be able to make decisions they see fit? Who cares if it's for them to make money, that's why they are in business.