GOP Rejects Obama Offer of $1.6 Trillion Tax Increase

[Crock Hunter]

Reagan did away with those loopholes and dropped the marginal rates, and revenues went up.

hummm... Let's see.. Reagan cut taxes in the 80s and the debt soared. . . in the 2000s Dubya cut taxes and the debt soared.. .

I guess you're saying that third time's the charm?

[Stinger]

The tax code in this country punishes the worker.

If tax breaks are given to those activities that are deemed to have special value, what does it say about those activities that are taxed at higher rates? Policymakers are indicating they consider the competing activities to be of lower value. That is precisely the issue with how we treat income.

The tax code says people should earn their income from almost any means other than labor. Wages and salaries are taxed at just about the highest rate of any income source. There are special low rates for dividends, capital gains, and interest income - especially from state and local debt - but if all you do is make your money from wages and salaries, you pay a higher tax rate.



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[Stinger]

dropped the marginal rates, and revenues went up.

Closed the loopholes, and revenues went up.

[Wneglia]

Some more context: Before and under Reagan, there were so many legal tax shelters available that virtually nobody paid the highest marginal rate. I remember one year back then when my taxable income was reduced by almost 90% through tax shelters, and even though those extremely high marginal rates existed, I paid almost no income tax. Reagan did away with those loopholes and dropped the marginal rates, and revenues went up.

Perhaps I'm unclear on your point. Are you saying that it's more complex than you told us on page 2 -

...Rates go down, revenues go up...

- And that I was correct there:

...what people really pay is more significant than what they can theoretically pay.

I agree that the arguments about marginal rates and revenues are complex, and that association is not the same as causation. With most of the historical tax cuts, more income was raised from the upper end than lower, for a variety of reasons. As Stinger pointed out, they were earning more money. Well, a good portion of that came from using capital saved from taxes for productive investments. Here is a good article from Slate that gives a fairly balanced view. Link

Vrede-remember a couple of years ago when I dreamed up a taxation system that addressed progressivity, enhanced revenues, simplicity, fairness, etc.

0-$50K 10%
$50K-$500K 20%
$500k-$5M 30%
$5M-$50M 40%
>$50 M 50%

There would be no deductions, credits, rebates, loopholes, and all income (earned and unearned) would be taxed.

[Wneglia]

There are lots of schemes, far fewer that have a realistic chance of passage. I'm for any that raise sufficient revenue, reduce intrusiveness and complexity, improve the economy for most of us, and reverse the transfer of wealth from the middle class to the uber-rich, not that those are entirely separable goals.

This would be the ideal time for Republicans to embrace and pass, untouched, Simpson Bowles. Then wait and see what the White House does.

[Wneglia]

This would be the ideal time for Republicans to embrace and pass, untouched, Simpson Bowles. Then wait and see what the White House does.

What would cause them to do that? They hated the tax increases and Pentagon cuts. It was DOA with both parties.

Here is an analysis of why

[Bungalow Bill]

The fact remains that the lowest top tax rate under Reagan was 28%. which is still
lower than Clinton's 39.6%. And the deficit fell every year under Clinton. Then Dumbya
decided it was time to give the money back and the rest is history. I guess it all matters
what one's definition of token is. If someone had their salary decreased by 16% or 25%,
I doubt they'd use the word token.

[Stinger]

The fact remains that the lowest top tax rate under Reagan was 28%. which is still
lower than Clinton's 39.6%. And the deficit fell every year under Clinton. Then Dumbya
decided it was time to give the money back and the rest is history. I guess it all matters
what one's definition of token is. If someone had their salary decreased by 16% or 25%,
I doubt they'd use the word token.

They were figuring that the debt they ran up with their No Billionaire Left Behind tax cuts would be repaid on the backs of the middle class.

"We're the only ones who gained wealth while the debt was running up because of the tax cuts that made us richer, but we want you peons to pay of the debt we benefitted from."

Kind of like the greedy Wall Streeters who took home billions wrecking the world's economy, and the taxpayers are the ones paying off the debts they created.

And they're probably right. It probably will get repaid on the backs of the middle class.

[bannination]

On the Fiscal Cliff, Republicans Got Nothin’

The reality should be seeping in to viewers of the Sunday shows that the Republicans don’t have a game plan. They don’t have a single, specific proposal to avoid the fiscal cliff. And even if they had one, they don’t have a roadmap to get there. They keep expecting Obama to come back with something more to their liking, which they’d also reject. Many Republicans literally don’t understand what is happening. Sen. Charles Grassley tweeted over the weekend that he was frustrated that President Obama hadn’t embraced the recommendation of the Bowles-Simpson Commission. Apparently, he is one of the many people in Washington who doesn’t understand that Bowles-Simpson recommended letting the Bush tax rates on the wealthy expire, while also proposing to cap or eliminate deductions primarily enjoyed by the wealthy.

[Reality]

So Banni, what's the dem plan other than tax the rich and eiliminate the ceiling on the deficit. Where's the detail that's any better than what the pubs have presented. Have you noticed Geithner has already started the blame game? Wonder why Obam didn't stay in Washington to defend his position?

Just think, if you eliminate the celing on the deficit there will be no need for a budget. Each government agency can spend whatever they want since no one needs to keep score.

[bannination]

So Banni, what's the dem plan other than tax the rich and eiliminate the ceiling on the deficit. Where's the detail that's any better than what the pubs have presented. Have you noticed Geithner has already started the blame game? Wonder why Obam didn't stay in Washington to defend his position?

Just think, if you eliminate the celing on the deficit there will be no need for a budget. Each government agency can spend whatever they want since no one needs to keep score.

The very second post on this thread debunks that. You should try learning sometime.

[Wneglia]

Reagan did away with those loopholes and dropped the marginal rates, and revenues went up.

hummm... Let's see.. Reagan cut taxes in the 80s and the debt soared. . . in the 2000s Dubya cut taxes and the debt soared.. .

I guess you're saying that third time's the charm?

Debt is related to 2 factors:
1. revenues
2. spending

If you always spend more than you take in debt is naturally going to increase.

The revenues during the Bush years increased:


The top 1% of taxpayers went from paying 38.4% of overall taxes to 39.1%, while the bottom 50% saw their share drop from 3.4% to 3.1%.

[Reality]

Banni said "The very second post on this thread debunks that. You should try learning sometime."

Your link was written, and or approved, by the ST who defends a no restriction debt limit. What do you think he is going to say?

Bani , you consider learning to be always sourced by the links you provide. There's a another world out there. You should try to be a part of it.

Your boy G said raising the debt limit allows the USG to pay existing obligations. If that is true why does the limit keep getting raised? Do you think it's because the USG keeps adding new obligations before meeting it's existing obligations? Isn't that the basic problem? What's an existing obligation today was an add on after the last raise in the limit. Those that propose raising the limit say we are meeting existing obligations while foregtting what has been added to the existing deficit that created the need to raise it again.

[Colonel Taylor]

Holy crap this is getting old let me handle the budget for a week and I'll have it under control in a few days. These politicians are a waste.
Simple start for ever penny you want to raise taxes by raising rates or loop holes you cut spending. You go back to what the spending was the years before. I doubt there is a department who can't cut 5-10% from their budget. Come on have you never been to a government office or worked off a Government contract?!?!? It's the ole NIMBY syndrome.

[billy.pilgrim]

Reich has always been able to lay it out sweet and simple

[Stinger]

When is a counterproposal not really a counterproposal?

When it comes from the Pubs.

1. It's not really a proposal -- it's just a set of headline numbers without specific policies. The letter says Republicans want to cut $900 billion from mandatory spending and $300 billion from discretionary spending, but they don't say what or how they want to cut. The letter nods toward a proposal sketched out by Erskine Bowles, the cornerstone of which is a gradual increase in the Medicare age, but it lacks specifics.

But they don't endorse specific loophole closures or propose a new rate structure.

Last week, the President put forward a reasonably specific list of policies. He didn't just propose to raise $1.6 trillion in new revenue and cut $400 billion from mandatory spending over ten years. He proposed specific changes to tax rates and deductions to produce the new revenues, and the entitlement cuts are laid out in his budget (most of the savings come from reductions to Medicare provider payments). Republicans didn't like those proposals, but this letter is not responsive to them.

2. The description of tax reform makes little sense. It's feasible to raise $800 billion from base broadening over ten years, but not to raise $800 billion and finance a significant cut in tax rates....

3. The proposal does not fully avert the fiscal cliff. Republicans describe their proposals as a way to "avert the fiscal cliff." But this proposal would only partly delay the implementation of austerity measures (tax increases and spending cuts) into future years when the economy is stronger.

Bloomberg



Come on, Republickens.

[Bungalow Bill]

Things were going pretty well during Clinton's last few years, deficit wise, but
then Bush came along and didn't want anything to do with a surplus, so he
cut taxes and then got us into two wars. Dumbya, the "gift" that keeps on
giving.




http://www.nytimes.com/2011/07/24/opini ... 4sun4.html

[Wneglia]

Fantasy of 91% marginal tax rates

[Apache]

The discharge action very well may shake this loose. I dont understand this kind of bull head thinking. After their defeat, you would think the Pubbies would stand up and listen a little!!

[Wneglia]

Fantasy of 91% marginal tax rates

Odd, I was the one on both pages 1 and 2 that posted that "effective tax rates" matter more than marginal tax rates in response to posts of yours. Thanks for the indirect acknowlegment.

True-"effective tax rates" are more important.