Nytebyrd Wrote:I tried reading this post straight through until I realized I didn't need to. I was glad that I scrolled back up to see that it had disintegrated into a public/private school debate. Local education should always be one of the focuses of a national election!

Nyte... as you're obviously new to this board (8 posts), welcome. You may have experience on other boards that you feel carry over to this one... I believe most of us would tell you that much like Rice itself, this board is just "different". IMO, we are a little more personal in that many of us know eachother by handle, and a surprisingly large number of us by name and face. As a result, you get more of the coctail party or pub crawl random chatter than on some boards. We veered off topic to education because it IS an issue people will vote on (the topic wasn't JUST the presidential election... and there will be MANY local elections decided at the same time)... one of our more respected young posters recently joined the teaching ranks... and another of our slightly more senior and respected posters has semi-retired from the business world and gone back to teaching in college... As a parent, I'm interested in education, and feel I have a somewhat unique perspective. Again... welcome... but get used to OT discussions, even in an OT thread.

back on topic...
The higher the top marginal tax rate, the greater the incentive to avoid it. This is done by hiring more or better lawyers or accountants... absorbing greater inefficiencies to avoid the tax (spending 70 cents to make a dollar rather than 50 cents) or in a worst case scenario... moving a company and its jobs overseas to avoid the taxes... and yes.... 3% on a multi-billion dollar company over even just a few years is REAL money, and will have consequences.

Stop talking about quartiles and quintiles and the guys making 250k. the guy making 250k is earning 200k more than the average earner... but is earning MILLIONS less than the top earners. We all will admit that the guy making 250k is "among" the top wage earners, and a bump in his taxes from 36-39% will result in only a $7500 increase in his (already) 90,000 tax bill. THAT isn't the guy that politicians are expecting to pay for their programs. They expect (and TELL us) that the guy earning $2.5mm (or 25mm) will foot the bill... but as should be obvious to EVERYONE by now, the Alternative Minimum Tax was designed to limit the deductions of the top wage earners to a point where they would AT LEAST pay roughly 25%. They didn't institute this because there weren't very many top wage earners able to claim deductions that put them in the same bracket as someone earning 50k. There were TONS of them. and THIS has ALL been at a bracket of less than 40%. Stop talking about the top bracket of wage earners, and instead talk about those people ACTUALLY subject to the top bracket. I'm betting that the vast majority of the top quartile, and perhaps the largest group by total dollars doesn't pay anywhere near the top bracket.

So businesses can avoid paying taxes in a variety of ways... primarily by passing the burden onto their consumers... and even the simply super-wealthy can pretty commonly limit their tax burden to 25%. By far the greatest tax burden is placed on (depending on how you define "rich") the upper-upper middle class... but NOT the upper class....

and we're surprised when the divide between the upper class and the rest of us is widening?? I can't believe we even have to talk about this sort of thing.

McCain's plan doesn't offer a break to the upper class... and Obama's plan doesn't tax them. Amusingly, Obama's plan will actually INCREASE the divide between the wealthy and the middle class.... Not nearly as much as some would say, or as others have done... but to deny that the truly rich can avoid taxes no matter where you set the bar, while the working "rich" cannot is stupid.

If we are to have a progressive tax plan (not my choice... but talking about what is, not what I'd like) WHY aren't we talking about progressing the AMT?? I'm betting that if we set the minimum rate of the AMT at 15% for incomes less than 250k, at 20% for incomes less than 500k, at 25% for less than $1mm and at 30% for >$1mm... and maybe even 33% >5mm. I mean, if the top bracket is 36%, and we have someone earning more than $5mm/year (CLEARLY a top earner)... why should we NOT expect them to have the highest percentage tax burden?? We'd take in MUCH more revenue from those that can MOST afford it. Sure, they'd still avoid many taxes... but at least the burden would be heaviest at the TRUE top, and not simply the guys fortunate enough to be doing well, but not so fortunate as to be killing them.

Boston Owl Wrote:EDIT: Obama's Social Security plan does not levy the tax for incomes between $102 and $250k, but he does propose a 2 to 4 percent (not a 12.4 percent!) marginal Social Security tax on incomes above $250k. (Source: http://ap.google.com/article/ALeqM5hyEHa...9272EV02). Sorry, but you still have a long way to go to justify your 70 percent figure.

BostonOwl - I've got to correct your edit here. Obama has proposed nothing specific in terms of the rate he is envisioning. That is a big part of that actual AP article, about how nebulous his Social Security tax proposal really is for the $250k+ crowd. If you read the article, you have folks tied to the campaign SUGGESTING that it MIGHT be 2% or 4%, or could be less than the current 6.2% for individuals. But I don't think Obama has even said explicitly (or on his site) that it will be less than current rates. We have nothing to go on. In fact, I'm curious if the employer portion also will be added to the figure or not? (Going to your argument about whether it's 12% or not.)

I know the conversation has moved away from this, but just trying to set the facts straight. Or maybe the lack of facts.

georgewebb Wrote:Of course, some people actually believe that cutting everyone's taxes by $1 is better than cutting some people's taxes by $2 and everyone else's by $3. This position only makes sense if you don't really like tax reduction in the first place -- or stated conversely, if you believe that taxes are good in themselves, and not merely a necessary evil.

...

- If the figures presented are true, if each candidate's plans would actually materialize, then either plan would reduce taxes for everyone. Good. That means that under either plan, every single person would be better off than they are now.
- The McCain plan would produce a greater total benefit than the Obama plan.
- Yet Democrats argue that the Obama plan is better because under the Obama plan, NO ONE gets a much bigger break than anyone else. They mae even tout the UNIFORMITY of the plan as a greater virtue than tax reduction itself.

To that mindset, it is more important to slice the pie up just so than it is to just bake a bigger pie. (Which make sense from their perspective, since slicing the pie up is the gleeful and jealously guarded job of politicians, interest groups, bureaucrats and other leeches on society; while baking pies is the job of people who actually work for a living.) I'd rather see government help make the pie bigger - while also making its own slice as small as possible.

Your analogy and arguments are faulty, I'm sorry to say, and indicative of how many anti-tax advocates mischaracterize facts and the arguments of their opponents.

Obama's plan does not make everyone better off, because it raises tax rates on the highest earners. (Go back and look at the figure again.) But you are correct that "the McCain plan would produce a greater total benefit than the Obama plan" -- if "total benefit" means tax reductions only and not any benefits that tax revenues can be used for. (Old Sammy makes an important observation on this point a few posts prior.)

But I dispute that "Democrats argue that the Obama plan is better because under the Obama plan, NO ONE gets a much bigger break than anyone else." This is overly broad at best and incorrect at worst.

Supporters of Obama's plan, including me, argue that it's better because it provides more tax relief to the vast majority of earners, among other things. (Go look at the figure again and the report from which it originates. Am I wrong?) Yes, that comes at the expense of a greater tax burden on a minority of the highest earners (including me). And it happens that the plan provides less total tax relief. But I (and others) think these drawbacks are worth it because of the greater relative relief Obama's plan provides to the vast majority of wage earners.

Which makes your $1/$2/$3 analogy an incorrect characterization of the situation. It's a straw man argument.

Following your structure and keeping it simple, what Obama's plan does is to provide $2 to, say, 4 out of 5 households, while taking $2 away from the richest 1 of 5 households. McCain's plan, on the other hand, gives $1 to 4 of 5 households and $3 to the richest 1 of 5 households.

Household 1 (poorest): $2 from Obama, $1 from McCain
Households 2-4: $2 from Obama, $1 from McCain
Household 5 (richest): -$2 from Obama, $3 from McCain

McCain's plan maximizes the size of the pie, as I like to say in the courses I teach: McCain provides a $7 pie, while Obama provides a $6 pie.

The difference is in the size of the slices. Obama's plan gives the poorest (i.e., not the richest) 4 of 5 households larger slices.

georgewebb, and anyone else reading this: You are certainly entitled to believe that a tax plan should provide the greatest total relief -- "help make the pie bigger," as you put it. Big pies are indeed delicious.

And others (like me) can believe that the size of the slices, and who gets which slice, can matter more than the overall size of the pie. Perhaps bigger slices to 4 of 5 eaters is desirable -- even if the fifth eater, who's not very hungry to begin with, gets screwed.

What we should not do is misrepresent the facts, draw false analogies, and set up straw man arguments.

PS: Hambone has argued several times for the importance of recognizing distributional issues and the consequences of tax rates within the top quartile. He's certainly right that there may be interesting things going on between the well-to-do and the really well-to-do. While I find that interesting, I don't think it impacts the argument I've made above. My points still stand.

If we want to argue about the progressive (and convoluted) tax system in the US, perhaps we should chew on some numbers presented here. I'm not saying that I agree with everything put out by this organization (never heard of them before, but looking at it, it seems to be a right-leaning "non-partisan" organization), but the facts come from the IRS.

And considering the the lower half of income earners in the US pay only 3% of total income taxes, how much more can Obama relieve their burden at this point? The shift in responsibility for total taxes up the income ladder in the past 3 decades is quite astounding. Even if he considers the bottom 75% of wage earners, the other 25% is paying 86% of taxes.

I'd love to see some more apples-to-apples comparisons of figures over time than what is shown in this release, to see how things have really shifted. There is a bit of what I might consider selective quoting to make their case here, and I'd love more comparisons to see how overall income levels have also shifted.

Hambone10 Wrote:If we are to have a progressive tax plan (not my choice... but talking about what is, not what I'd like) WHY aren't we talking about progressing the AMT??

That sounds like another patch on top of a system that's already horribly patchworked. I vote for a consumption tax to replace income taxes. (See, Optimistic Owl and I agree on something other than Rice athletics!) Exempt groceries, medical care and rent, tax everything else. The effect will be mildly progressive.

The only drawback I see is transition. It would probably phase in, so we would have both consumption and income taxes in place at the same time. No guarantee one would go away.

Old Sammy Wrote:You could argue, I suppose, that the use government puts those funds to is somehow less efficient an economic choice, but unless you're willing to abrogate every government service and pay your own private army, police force, etc., you have to concede some need for government services. The discussion then becomes which ones and how should they be funded.

OptimisticOwl Wrote:Shoot the wolves...

In the last five years, within a mile of my house, two new shopping centers were built, over 120 acres of land - Lowes, Target, Penney's, Belk, OfficeMax, dozens of other businesses. six restaurants, five hotels. In construction, they provided jobs for hundreds of carpenters, electricans, truck drivers, HVAC, surveyors, lawyers, etc, and now they provide hundreds of jobs for managers, clerks, warehousemen, waiters, etc. They were not built by 10,000 middle class people each putting up $3,000. They came about because a rich man persuaded some other rich people to join with him in a for-profit endeavor. Repeat, for-profit. Without rich people trying to make a profit, things like this don't happen. Take away either their capital or their willingness to use it here for this, and it doesn't happen. So when we raise the capital gains taxes, it chips away at both of these. If they cannot make a sufficient return off their money building shopping centers here, they will put their capital to work elsewhere. Thousands of lower income people will be hurt by the lack of work. Why invest in a project with a projected 10% aftertax return when you can earn 6% elsewhere with no risk, maybe with a tax break? Maybe you don't like rich people, but many of them are pretty smart. Smart enough to do the math.

Obama wants to shoot the wolves. Maybe just cripple them a little bit...why? For votes? "Tax the Rich" and "Save the Deer" both play well to mass audiences.

I don't have to like the wolves to know they have a place in the order of things. I don't have to be a wolf either.

A disclaimer here - I am not in the income range that Obama says would be affected. I make a lot less than $250K/year. A lot, lot less. But i do own mutual funds, and pay taxes on capital gains. Occasionally i invest in real estate on a small basis. If higher taxes make that too much risk for too little aftertax return, i will stop.

No one is going to shoot the rich. The Bolsheviks tried that and it didn't work. (Though in the extreme, it could happen - see, e.g., Robespierre. A good reason not to let the income gap get too wide.) Your shopping center needed more than investors - it needed customers - you know, those people who aren't rich.

Why invest in a project with 10% return when you could get an assured 6%? Maybe because 10 is bigger than 6, and that's an appropriate risk premium.

GWB proved in 2000 and 2004 that "tax the rich" really doesn't sell, probably because most of the people who aren't rich dream some day of approaching some level of wealth.

My disclaimer - if 2007 is any indication, I am just barely in the income range Obama says would be affected. But that's OK. I use a lot of government services and don't mind paying for them.

My eco prof made the point that some taxes are needed, to pay for the things that are impractical to do individually, like military defense and fire/police protection. A lot of the government services you are happy to pay for do not fall in those categories. But as you say, the discussion then becomes which ones and how they should be funded. Personally, I could do with a lot less government help.

RE: wolves. You have taken this far too literally. To shoot the wolves, literally eradicate them as we did in Yellowstone, is not what Obama et all want to do with the rich.. They just want to bleed them, maybe cripple them by reducing the capital they would have available for investment and/or reducing their incentive to invest in certain ways. I don't believe this is his goal - it is just an unintended consequence of achieving his primary goal, which is to get enough votes (mostly from people who don't understand or use capital investment) to be elected. It is that that he either doesn't understand or doesn't care that bothers me.

Investment decisions are not made solely on expected return. Things like risk, time periods, difficulty of investing, etc, are part of the decisions of every investor. An aftertax return of 6% in municipal bonds might seem quite attractive compared to a 10% PROJECTED return in three years from a shopping center investment. It might not compared to an PROJECTED 18% return - the difference being the extra taxes deducted from the identical pretax return. If it results in the diversion of capital from these projects, then they won't get done. Thousands of people who would have gotten work/income won't - but they won't know what they missed or why.

You are quite right about the customers - in fact that was the whole point of my little analogy. Wolves, worms, trees, are all part of a balanced ecology, just as rich, middle clas, and poor are all part of a balanced economy, and to damage any part is to damage the whole. I know your mission to to eradicate poorness, so there are no poor people, but these terms are all relative, not absolute. Poor in America is pretty well off compared to most of the world. A rising tide lifts all boats, and that includes the boats of the rich as well as the boats of the poor. You can raise minimum wage to $200K/year, and we will still have rich, middle and poor.

Hambone is right. The "rich" (high income) will not pay the high rates because the "rich" (Democrat and Republicans alike) will use the "tax breaks for the rich" to reduce their liability. John Kerry, in his released tax returns in 2004, showed a tax of $590,000 on income of $5,000,000. Do the math. He used thoose "tax breaks for the rich". Quite legally, and I have no quarrel with his use of them. I expect every high income and most medium income income taxpayers to do the same. I expect you will, I know I will, most of the people on this board will. If you have only wages and use the standard deduction you won't, other wise you will.

I was watching Hannity and Colmes a couple of weeks ago when Hannity made remarks about Obama's tax increase. Colmes, as is his job, jumped immediately to BO's defense by pointing out that "only a few" taxpayers would be affected. It raised this question with me - if "only a few" is good, wouldn't less be better? How about raising taxes on only those with $5mm or more? Why not limit it to the top 400? 200? It becomes clear that if taxing fewer people is what makes a tax "good" and "fair", then wouldn't taxing ZERO people be the best and fairest?

gsloth Wrote:

Boston Owl Wrote:EDIT: Obama's Social Security plan does not levy the tax for incomes between $102 and $250k, but he does propose a 2 to 4 percent (not a 12.4 percent!) marginal Social Security tax on incomes above $250k.

BostonOwl - I've got to correct your edit here. Obama has proposed nothing specific in terms of the rate he is envisioning. That is a big part of that actual AP article, about how nebulous his Social Security tax proposal really is for the $250k+ crowd. If you read the article, you have folks tied to the campaign SUGGESTING that it MIGHT be 2% or 4%, or could be less than the current 6.2% for individuals. But I don't think Obama has even said explicitly (or on his site) that it will be less than current rates. We have nothing to go on. In fact, I'm curious if the employer portion also will be added to the figure or not? (Going to your argument about whether it's 12% or not.)

I know the conversation has moved away from this, but just trying to set the facts straight. Or maybe the lack of facts.

Fair enough.

Obama has not proposed a specific Social Security tax rate for incomes above $250k. While the AP article and the excellent and reputable Tax Policy Center report I linked to earlier assume 2-4 percent, you're right that his plan is nebulous. (See http://www.taxpolicycenter.org/UploadedP...idates.pdf)

On the question of whether to add the employer's contribution to Social Security tax to the employee's burden: The answer depends, of course, on the relative elasticities of supply and demand in the relevant markets for labor! I'm too lazy right now to look up the latest empirical literature on Social Security tax incidence. Though the law says that employees and employers split the tax equally, who actually pays depends on economic forces. Bow down before the power of supply and demand.

I originally raised the issue in the context of disputing mebehutchi's claim that top marginal tax rates will reach 70 percent. I find that figure implausibly high, and still do, even if you adopt the assumptions least helpful to my position. To wit:

-- Obama's proposed top marginal tax rate: 39.6 percent
-- Suppose Obama extends the Social Security tax in full to incomes above $250k, labor supply is perfectly inelastic, and thus employees pay it all: 12.4 percent
-- Medicare payroll tax, assumed to be paid in full by employees: 2.9 percent
-- Top state-level marginal tax rate (Vermont): 9.5 percent

Total top marginal tax rate (worst-case scenario): 64.4 percent.

Now, that's close to 70 percent, which perhaps makes my dispute with mebehutchi seem a little silly on my part. But remember that this is a worst-case scenario: a well-to-do person lives in Vermont, where labor supply is perfectly inelastic, and Obama (and Congress) go all Social-Security tax happy. I think a more likely scenario is one in which the top marginal tax rate ends up 50-60 percent in total.

Yes, that's high. And in my dispute with mebehutchi, I have probably missed the forest for the trees, as they say. Those folks lucky and skilled enough to make the big bucks will take home less than half of the dollars they make above $250k. All of us should take seriously the economic disincentives such a high marginal tax rate creates, and weigh those impacts against the benefits that the added tax revenues could create.

But we should also keep things in historical perspective. Top marginal tax rates and Obama's proposal are among the lowest in the past century. For example, the top federal marginal tax rate was above 90 percent throughout the 1950s. Despite such a punishing rate, the 1950s were a period of tremendous GDP growth, if I remember correctly. (Perhaps growth would have been even greater without such high tax rates at the top.) Obviously, the top rate, including payroll and state taxes, is much lower now, which is almost certainly a good thing economically.

Old Sammy Wrote:

Hambone10 Wrote:If we are to have a progressive tax plan (not my choice... but talking about what is, not what I'd like) WHY aren't we talking about progressing the AMT??

That sounds like another patch on top of a system that's already horribly patchworked. I vote for a consumption tax to replace income taxes. (See, Optimistic Owl and I agree on something other than Rice athletics!) Exempt groceries, medical care and rent, tax everything else. The effect will be mildly progressive.

The only drawback I see is transition. It would probably phase in, so we would have both consumption and income taxes in place at the same time. No guarantee one would go away.

I agree with you... but I'd prefer a patch to nothing while we argue about how to make the dramatic change to a consumption tax (assuming that we'd (congress.. not us) even agree to THAT, which I doubt)... or worse yet... continuing to tax the 100-500k (or whatever the range is) out of existence without taxing the $1mm plus (again, or whatever the number is)

Boston, while i don't disagree with the analysis... I WOULD have to add this... bold edits are mine

Boston Owl Wrote:Household 1 (poorest): $2 from Obama, $1 from McCain
Households 2-4: $2 from Obama, $1 from McCain
Household 5 (richest): -$2 from Obama, $0 from McCain
Household 6 (the REALLY rich): $0 from Obama, $0 from McCain.

I could argue that increasing taxes on the really rich might make some tax incentives they currently DON'T use economically viable, and thus increasing the taxes on the rich actually DECREASES the taxes on the REALLY rich... but though it makes financial and logical sense, I can't substantiate it. Keeping existing incentives is not the same as creating new ones. You aren't cutting the taxes on the rich by stopping a previous cut from expiring. Kind of like the old argument that decreasing the size of a planned increase in spending is somehow a spending cut. No revenue is lost from keeping previous cuts... and if we're REALLY honest... as there are MANY more households in 1-4 than in 5... We're really talking about more like -10 or -20 for household 5 to give households 1-4 $2

Obama's plan is tax the fairly rich, and POTENTIALLY give to everyone else... including the super-rich. Obama's proposal about windfall profits (has he gone away from that yet??) is an equal tax on EVERYONE, but because it will be passed on based on comsumption, actually becomes regressive. The rich might use a large multiple of the gas used by an average person, but even Al Gore's energy multiple is lower than his income multiple.

Look... I'm not saying McCain has a good idea... but doing no harm is better than making things worse. Given that a fairly large percentage of the income of household 1, and likely households 2-4 goes towards fuel, I wonder if that doesn't have a HUGE impact on those figures.

A guy making 25k/yr might pay $1,500/year in gasoline... but the guy making 250k probably doesn't pay $15,000/year...

OptimisticOwl Wrote:I was watching Hannity and Colmes a couple of weeks ago when Hannity made remarks about Obama's tax increase. Colmes, as is his job, jumped immediately to BO's defense by pointing out that "only a few" taxpayers would be affected. It raised this question with me - if "only a few" is good, wouldn't less be better? How about raising taxes on only those with $5mm or more? Why not limit it to the top 400? 200? It becomes clear that if taxing fewer people is what makes a tax "good" and "fair", then wouldn't taxing ZERO people be the best and fairest?

Colmes is a moron. As usual, he set himself up for a (convincing) rebuttal just like the one you provided. (So, a side question: Why doesn't Hannity and good ol' Fox hire a liberal with a little more, ahem, intellectual firepower than Alan Colmes? Wouldn't that be fair and balanced? If I wanted to sponsor a even debate about baseball strategies, I wouldn't put Merissa Leebron up against Wayne Graham.)

The proper defense of Obama's tax proposal is the one I provided above. It affects all taxpayers, but in a different way from McCain's proposal. It provides more to 4 of 5 households and less to 1 of 5 households. You can agree or disagree with it in a reasonable, rational way.

Well...now neither of these guys in your example have to worry about higher gasoline prices...Obama is proposing that the big oil monopolies that control under 10% of the market cut checks to every american household for $1,000. I think he should seize the cash hoard on Microsoft's balance sheet while he's at it. I've never understood why when you make money in energy you are a villain but if you take a tech company public and you and all your investors go bankrupt you're a hero. What scares me about his tax plans is the increasingly socialist rhetoric that is attached. I really hope we don's see 65-70% taxation but the slope is slippery if this is the line of thinking.

Obama simply asks that big oil companies contribute a reasonable share of the windfall profits they receive from high oil prices over the next five years to pay for emergency assistance for families right now,” the campaign says.

extra post

Old Sammy Wrote:I vote for a consumption tax to replace income taxes. (See, Optimistic Owl and I agree on something other than Rice athletics!) Exempt groceries, medical care and rent, tax everything else. The effect will be mildly progressive.

The only drawback I see is transition. It would probably phase in, so we would have both consumption and income taxes in place at the same time. No guarantee one would go away.

We probably agree on a lot more than than either of us think.

I would exempt gasoline also, and the rent thing is tricky - if we extract a big sales tax from buyers but not renters, we could change back to a nation of renters instead of a nation of homeowners. I am sure that something could be worked out.

In transition, an estimated sales tax paid (or actual receipts) could be offset against the 1040 amount, paying the difference if positive. The really tricky part is making sure we don't end up with both, and/or making sure we don't go down the path again of adding exemptions and special treatments to benefit a lawmakers home state or campaign donors. I'm sure the Iowa delegation would want to exempt corn products and insurance, the Texas delegation would want exemptions on natural gas, etc. To make it work, we must follow the KISS plan - Keep It Simple, Stupid. Appropriate laws and/or constitutional amendments would be needed to make sure we didn't end up with both and that we didn't end up with another complicated mightmare. Few worthwhile things are easy.

OptimisticOwl Wrote:Hambone is right. The "rich" (high income) will not pay the high rates because the "rich" (Democrat and Republicans alike) will use the "tax breaks for the rich" to reduce their liability. John Kerry, in his released tax returns in 2004, showed a tax of $590,000 on income of $5,000,000. Do the math. He used thoose "tax breaks for the rich". Quite legally, and I have no quarrel with his use of them. I expect every high income and most medium income income taxpayers to do the same. I expect you will, I know I will, most of the people on this board will. If you have only wages and use the standard deduction you won't, other wise you will.

But HERE is my point OO

By the numbers, Kerry SHOULD have paid $1.8mm or so. I don't know of many people who earned $250,000 that paid less than 26k in taxes, do you?? "a guy I know" maxed out his deductions, got hit by the AMT and STILL ended up paying 28%.

How is it that a guy who makes $5mm ends up paying less than half the supposed Alternative MINIMUM tax?? He pays a lower percentage in taxes than someone who makes 30k/year!!!

His accountants are better than the rest of ours and/or $5mm allows you to be a "business" while $250k doesn't (and 30k certainly doesn't)

It takes raising the marginal tax rate from 36 to 39% on 173 of those making 250k JUST to make up for the $1.3mm in taxes that John Kerry was able to avoid.

Someone tell me how this is taxing the rich to pay for the poor??

Boston Owl Wrote:(So, a side question: Why doesn't Hannity and good ol' Fox hire a liberal with a little more, ahem, intellectual firepower than Alan Colmes? Wouldn't that be fair and balanced?

But where could you find a liberal with more intellectual firepower than Colmes? Al Franken? Michael Moore? Alec Baldwin?

OK, cool down, just funning you. For sure, Colmes is somewhat ineffectual. I think it is because his standard response starts with "What about...", essentially saying "yeah, you're right, but Republicans do it too, so you are a hypocrite to bring it up about liberals. But intellectually, i think he is the equal of Hannity, perhaps even superior. He just doesn't use it well. Of course, he is limited by his material, too.

kinderowl Wrote:[quote=Owl-88]
And, by that I mean, individual liberty, baby. And by that I also mean candidates who support gay rights.

As someone who has voted for the Republican in all but one Presidential election since 1980, I want you to know that as far as i am concerned, if two or more consenting adults of any orientation want to take on the legal reponsibilities of marriage, it is fine with me.

And just to answer the obvious question, the year was 2004, and I voted for a Democrat. A black democrat. He didn't win. (Duh!) But I thought he deseved some recognition.

Boston Owl Wrote:But we should also keep things in historical perspective. Top marginal tax rates and Obama's proposal are among the lowest in the past century. For example, the top federal marginal tax rate was above 90 percent throughout the 1950s. Despite such a punishing rate, the 1950s were a period of tremendous GDP growth, if I remember correctly. (Perhaps growth would have been even greater without such high tax rates at the top.) Obviously, the top rate, including payroll and state taxes, is much lower now, which is almost certainly a good thing economically.

More importantly, we need to keep things in geographical perspective. I can't relocate my plant from Illinois to 1950. But I can relocate it from Illinois to Ireland. While our tax rates are lower than they were in the 1950s (thanks to one large decrease under JFK and two under RR), the rates are much lower in other countries too.

For example, since the Clinton era our corporate income tax rates have not increased, but they have gone from among the very lowest in the OECD world to second-highest because of changes around us.

We need to be aware of these changes. We need to realize that other countries are lowering taxes to chase business, and it's working for them. Whether we lower ours to compete is a political choice, but we need to be certain we know the stakes before making that choice. It's not just how much the "rich" pay versus how much the "poor" pay. It may come down to whether there are any "rich" left to pay.

At least on the individual side, we will continue to tax US citizens even if they move away, so that threat is not as great as it is for other countries with different tax schemes. But higher corporate taxes will drive away businesses and higher capital gains and dividends taxes will drive away investment. For an economy that spends more than it makes and saves less than any other developed country, those are very dangerous things to allow to happen.

How are other countries doing it? Value added taxes. Should we do the same? Again, that's a policy decision. There is no one right answer. I tend to think "yes" but you are entitled to a different opinion. What we are all entitled to is to have these decisions made with all the facts on the table.

OptimisticOwl Wrote:

kinderowl Wrote:[quote=Owl-88]
And, by that I mean, individual liberty, baby. And by that I also mean candidates who support gay rights.

As someone who has voted for the Republican in all but one Presidential election since 1980, I want you to know that as far as i am concerned, if two or more consenting adults of any orientation want to take on the legal reponsibilities of marriage, it is fine with me.

I think that is the position of MANY Republicans/conservatives... at least the vast majority of the ones I know... just not "The Moral Majority"... Interestingly, I find plenty of supposedly liberal people who wish to control the personal lives of individuals as much as TMM.

One of the reasons i go to the church that I do is because when a certain denomination was Boycotting Disney for its stance on gay rights, my preacher did a sermon mentioning that Jesus never practiced the "Christian" art of boycott. IMO that's the difference between having your faith influence your politics, and having your politics influence your faith.

OptimisticOwl Wrote:

Old Sammy Wrote:I vote for a consumption tax to replace income taxes. (See, Optimistic Owl and I agree on something other than Rice athletics!) Exempt groceries, medical care and rent, tax everything else. The effect will be mildly progressive.

The only drawback I see is transition. It would probably phase in, so we would have both consumption and income taxes in place at the same time. No guarantee one would go away.

We probably agree on a lot more than than either of us think.

I would exempt gasoline also, and the rent thing is tricky - if we extract a big sales tax from buyers but not renters, we could change back to a nation of renters instead of a nation of homeowners. I am sure that something could be worked out.

I would consider buying real property to be an investment, not taxable consumption. Exempting residential rents passes the real property exemption on to residents.

Gasoline is taxed pretty heavily now, so it probably isn't a good idea to hit it with both consumption and excise taxes. Though it's a good conservation measure. Nothing like gas costing another $1/gallon to get people to conseve it.

Boston Owl Wrote:Obama's plan does not make everyone better off, because it raises tax rates on the highest earners. (Go back and look at the figure again.)

Apparently I gave him too much credit!

Boston Owl Wrote:But you are correct that "the McCain plan would produce a greater total benefit than the Obama plan" -- if "total benefit" means tax reductions only and not any benefits that tax revenues can be used for.

It seems fair to measure the "total benefit" of a tax reduction plan by how much it reduces taxes. If the argument is that taxes should not be reduced because just look at all the wonderful things government can do with the money, then I think the Pentagon, the farm lobby, the highway builders and others would agree!
And if the REAL argument is that taxes should not be reduced because the government can do wonderful things with the money if only the government were entrusted to "truly" smart people who would do the things that self-designated smart people consider wonderful, well ... I think P.J. O'Rourke said it best: "Giving money and power to government is like giving whiskey and car keys to teenage boys."

Boston Owl Wrote:But I dispute that "Democrats argue that the Obama plan is better because under the Obama plan, NO ONE gets a much bigger break than anyone else." This is overly broad at best and incorrect at worst.

Correction: Democrats argue that the Obama plan is better because it gives gives larger reductions to some people rather than others, whereas under McCains' proposal, the reverse is true.

Boston Owl Wrote:Household 1 (poorest): $2 from Obama, $1 from McCain
Households 2-4: $2 from Obama, $1 from McCain
Household 5 (richest): -$2 from Obama, $3 from McCain

McCain's plan maximizes the size of the pie, as I like to say in the courses I teach: McCain provides a $7 pie, while Obama provides a $6 pie.

Let's see: I could vote to make everyone better off, although by different amounts. Or I could vote to make some people better off by confiscating more from others - and with a smaller aggregate improvement. Seems pretty clear to me.

Boston Owl Wrote:And others (like me) can believe that the size of the slices, and who gets which slice, can matter more than the overall size of the pie.

Which is exactly the blinkered, pessimistic, zero-sum mindset that through human history has produced a range of inferior policy, waste, misery -- and ultimately, no greater equality.

Boston Owl Wrote:What we should not do is misrepresent the facts, draw false analogies, and set up straw man arguments.

I am not sure my post could be fairly characterized as
"mispresenting" facts. Apparently I erred in stating that Obama's plan reduces taxes for everyone - but since that error actually worked in favor of his plan, it is not an error that really deserves to be tarnished. I also stated that McCain's achieves a greater aggregate reduction, which is agreed.

As for "false analogy" or "straw man" labels, with all due respect, these seem a little heavy-handed. You have disputed the arguments quite well, but to imply that they were originally made in bad faith or with deliberate or even reckless disregard for logical integrity is a little undeserved.

OptimisticOwl Wrote:Shoot the wolves. They eat little baby deer, and nobody likes them anyway. nasty mean animals who hurt other animals. So we got rid of the wolves, and the deer population exploded. Not only did many deer starve, but the vegetation was stripped, forests died. Now, with more understanding that all parts of an ecolgy are needed for a healthy ecology, the wolves are being reintroduced into areas in which they were eradicated.

I usually don't have much to add to a political discussion, but this being Friday afternoon and all...

The was a badass wolf in the movie "300".

Back to your regular political programing.