Biden on charitable donations and taxes

weslinder · Sep 21, 2008

F.D. Khan said:

Thoughts?
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I agree completely, and I know more rice farmers than hedge fund managers. We haven't had such Hooverian rhetoric from a Presidential candidate since Hoover. John McCain should bring it up. I'm sure he remembers the Hoover campaign.

To the original topic:

This doesn't surprise me at all, but it's not just a Biden issue or an Obama issue. It is an issue with all big government-types. From George Will, about an academic book on the topic:

Bleeding Hearts but Tight Fists

By George F. Will
Thursday, March 27, 2008; A17

Residents of Austin, home of Texas's government and flagship university, have very refined social consciences, if they do say so themselves, and they do say so, speaking via bumper stickers. Don R. Willett, a justice of the state Supreme Court, has commuted behind bumpers proclaiming "Better a Bleeding Heart Than None at All," "Practice Random Acts of Kindness and Senseless Beauty," "The Moral High Ground Is Built on Compassion," "Arms Are For Hugging," "Will Work (When the Jobs Come Back From India)," "Jesus Is a Liberal," "God Wants Spiritual Fruits, Not Religious Nuts," "The Road to Hell Is Paved With Republicans," "Republicans Are People Too -- Mean, Selfish, Greedy People" and so on. But Willett thinks Austin subverts a stereotype: "The belief that liberals care more about the poor may scratch a partisan or ideological itch, but the facts are hostile witnesses."

Sixteen months ago, Arthur C. Brooks, a professor at Syracuse University, published "Who Really Cares: The Surprising Truth About Compassionate Conservatism." The surprise is that liberals are markedly less charitable than conservatives.

If many conservatives are liberals who have been mugged by reality, Brooks, a registered independent, is, as a reviewer of his book said, a social scientist who has been mugged by data. They include these findings:

• Although liberal families' incomes average 6 percent higher than those of conservative families, conservative-headed households give, on average, 30 percent more to charity than the average liberal-headed household ($1,600 per year vs. $1,227).

• Conservatives also donate more time and give more blood.

• Residents of the states that voted for John Kerry in 2004 gave smaller percentages of their incomes to charity than did residents of states that voted for George Bush.

• Bush carried 24 of the 25 states where charitable giving was above average.

• In the 10 reddest states, in which Bush got more than 60 percent majorities, the average percentage of personal income donated to charity was 3.5. Residents of the bluest states, which gave Bush less than 40 percent, donated just 1.9 percent.

• People who reject the idea that "government has a responsibility to reduce income inequality" give an average of four times more than people who accept that proposition.

Brooks demonstrates a correlation between charitable behavior and "the values that lie beneath" liberal and conservative labels. Two influences on charitable behavior are religion and attitudes about the proper role of government.

The single biggest predictor of someone's altruism, Willett says, is religion. It increasingly correlates with conservative political affiliations because, as Brooks's book says, "the percentage of self-described Democrats who say they have 'no religion' has more than quadrupled since the early 1970s." America is largely divided between religious givers and secular nongivers, and the former are disproportionately conservative. One demonstration that religion is a strong determinant of charitable behavior is that the least charitable cohort is a relatively small one -- secular conservatives.

Reviewing Brooks's book in the Texas Review of Law & Politics, Justice Willett notes that Austin -- it voted 56 percent for Kerry while he was getting just 38 percent statewide -- is ranked by the Chronicle of Philanthropy as 48th out of America's 50 largest cities in per capita charitable giving. Brooks's data about disparities between liberals' and conservatives' charitable giving fit these facts: Democrats represent a majority of the wealthiest congressional districts, and half of America's richest households live in states where both senators are Democrats.

While conservatives tend to regard giving as a personal rather than governmental responsibility, some liberals consider private charity a retrograde phenomenon -- a poor palliative for an inadequate welfare state and a distraction from achieving adequacy by force, by increasing taxes. Ralph Nader, running for president in 2000, said: "A society that has more justice is a society that needs less charity." Brooks, however, warns: "If support for a policy that does not exist . . . substitutes for private charity, the needy are left worse off than before. It is one of the bitterest ironies of liberal politics today that political opinions are apparently taking the place of help for others."

In 2000, brows were furrowed in perplexity because Vice President Al Gore's charitable contributions, as a percentage of his income, were below the national average: He gave 0.2 percent of his family income, one-seventh of the average for donating households. But Gore "gave at the office." By using public office to give other people's money to government programs, he was being charitable, as liberals increasingly, and conveniently, understand that word.
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F.D. Khan · Sep 21, 2008

F.D. Khan said:

I don't know the breakdown of how those figures are created but i'm sure much of it is significantly skewed by the .1 or less % of people that perhaps run hedge funds or recieve stock as their massive compensation. As a hedge fund managers compensation is a shift from limited to general partners, its considered an investment and therefore if held over a year must pay capital gains tax which at the long-term highest level is now 15%.

The Jim Simons and Steve Cohen's of the world would skew that figure to give the illusion that the top 1% are paying less. I really don't think that top 1% figure pay less can be true for most reasonably successful people that are making $250k a year. Raising their taxes due to a small fractional group skewing the figures I think does not provide justice.

More concerning to me than direct taxes, are indirect taxes and increases on the cost of goods and services due to Obama/Biden's perspective on free trade, and the burden of additional rules and requirements that will force them to pass those costs on to consumers. As lower income people spend a disproportionate amount of their income on consumption, this will ultimately indirectly cost them more. Maybe I should start a new thread on this subject.

Thoughts?
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What I forgot to add is that if we limit this loophole for these investment partnerships (i.e. hedge funds), they they will simply set up shop in the UK or other nations. So those people that skew the numbers have the ability to shift locales and therefore the US won't even get the 15% of the billion dollar guys compensation and instead gets zero while those people making $250k a year get taxed at a much higher rate which was justified by people that are no longer american taxpayers.

The idea sounds good but on a practical level I don't think it will have the desired effect. It may actually reduce absolute total taxable revenues which is truly not what we need at this time.

SamFisher · Sep 21, 2008

F.D. Khan said:

What I forgot to add is that if we limit this loophole for these investment partnerships (i.e. hedge funds), they they will simply set up shop in the UK or other nations. So those people that skew the numbers have the ability to shift locales and therefore the US won't even get the 15% of the billion dollar guys compensation and instead gets zero while those people making $250k a year get taxed at a much higher rate which was justified by people that are no longer american taxpayers.

The idea sounds good but on a practical level I don't think it will have the desired effect. It may actually reduce absolute total taxable revenues which is truly not what we need at this time.
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There are many hedge funds that operate here that are already incorporated offshore.

It's not exactly a new idea.

F.D. Khan · Sep 21, 2008

SamFisher said:

There are many hedge funds that operate here that are already incorporated offshore.

It's not exactly a new idea.
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But doesn't it make it more attractive to do so if the rules are changed or taxes are increased on them? I don't really appreciate from a personal standpoint that friends of mine that make a LOT more than I do pay a lot less in taxes, but even 15% on an absolute level of what some of these guys make is great revenue to the US government.

I just don't want those huge absolute revenues to the US government leaving when the US taxpayer is taking on some pretty big undertakings
over the last few days and we will need all that we can get.

IROC it · Sep 22, 2008

bigtexxx said:

Tim McVeigh was in the military, too. Both him and Jeremiah Wright share a hatred of America (well, before McVeigh was executed)
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Dude... don't take left turns like that.

sook · Sep 22, 2008

roflmao ^^

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