Obama, Edwards Craft Tax Hike Plan to Destroy Wealth and Savings

If the company cut my pay - yes. If the gov't asked me to pay more tax - no.

Huge difference. If every high income earner pays it, it has nothing to do with my employer. Id work just as hard because Im still better off than 99% of the population and Im in the same boat as every other high earner.

You're talking apples and oranges and you know it.

 

You get to deduct your state and local taxes. The rest of it is a choice you make. If we are going to have an income tax (a ridiculous concept if you ask me), it should be apportioned evenly.

 

To me, it's not that rich people "need" the money. It's about economic growth. Lower tax rates promote growth.

Many countries around the world have income and corporate tax rates competitive with the U.S. now. By increasing tax rates we may fall behind.

I am all for progressivism in tax rates (as long as they dont get too high), but we need to make the code simpler. It is way too complicated.

 

Did you know that the US is now 2nd in the world (to Japan) in business tax rate? Surprised me.



Edit: I know there are other countries not included, and at least Venezuela has a higher business tax rate.

 

Not if you're subject to AMT. Not if you don't itemize.

 

Wow I didn't realize it was that bad. There was an article in the WSJ about how the rest of the world is adopting Reaganomics while tax cuts dont seem like a posibility here.

 

it doesn't matter, i still pay the same amount of tax no matter how my accountant sliced it.

 

In interest of full disclosure, most of Europe relies heavily on a Value-added Tax, which would have a similar effect to a business income tax for manufacturing or import businesses.

 

Crazy, I blame this on spending. I don't want U.S. to be a socialistic country, I don't believe in entitlement, I do believe that there needs to be some massive overhaul in tax rate.

I think a new tax system needs the following: a national sales tax, with higher tax on luxury goods (might be hard to define).

Some sort of way to deter savings, yeah I know the cry of American's are in debt and we're all corporate slaves etc etc. However, I know people putting money in a bank and just let it sit there does not help the economy. Come up with a system to promote investment and deter savings.

 

You kidding? Where do you think banks get money to loan out. That's right savings. Less money in banks means the supply of money that can be loaned out declines. Thus making it more expensive to borrow and leading to higher interest rates. Higher interest rates lead to less investment since its more expensive to borrow money.

Quite the opposite we need to ENCOURAGE savings. There's a gigantic savings gap in this country. Too much savings is a bad thing if it trades off with consumption. But we have plenty of that right now and could use some savings.

Also considering how mad everyone is that the Fed has an abnormally low federal funds rate, your plan would make that even worse because in order to counter rising interest rates in borrowing the fed would be forced to introduce more money into the money supply to lower the federal funds rate.

 

What I am hoping for is less traditional savings and increase in investments. I do not want a tax system that necessarily awards consumption (hence the nation wide sales tax). While there might be less money sitting in Bansk to lend out, it could be offset a higher amount liquidity in private funds.

Major non deposit based lenders such as Countrywide can securitize loans not just with the major banks (BOA, HSBC, Citi and Chase) but also private investment funds.

Increase in money needed for investment should also spur greater venture capital money. What I'm hoping for is to take the investment capital from traditional institutions (who due to need to hit earnings numbers and satisfy share holders) might be more conservative with the lending. Instead of having money sitting in the Bank to loan and letting banks to loan it out, I want people to throw more money in the market.

I do admit, I haven't really thought this trhough And yes, even as I write this, I can see how this can back fire really badly throw us into a horrible depression. But damn it, this country has gotten stagnant and is in a steady decline, time to roll some mother f__cking dice.

 

We have problems but our economy isn't "stagnant." The GDP growth rates we've seen since the early 90s (outside of the 01 recession) have been incredible and unprecedented. Productivity growth in this country has been growing at rates we haven't seen since the introduction of electricity. Growth has been amazing. At the same time, consumption spending has almost gotten ridiculous. No one saves anymore. Your plan almost seems pointless. Savings are at an all time low in this country and the plastic revolution of credit cards has basically sucked out what little savings there might be.

Not to mention, its pretty a pretty basic financial rule that you need a level of debt in order to function properly. Companies can't run on 100% equity which is what you're proposing. That's madness. There's a reason why there's a debt-equity ratio. You need to leverage your company with debt and ownership probably wouldn't be a fan of ceding away control of a company just to raise money, hence the need for an affordable option to pick up debt. No sane corporation would forgo debt for exclusive equity.

We need savings now. That's why people support national sales taxes because they tax consumption and encourage people to save in some capacity. We need savings, period. Greenspan (who people either love or hate here apparently) used to harp all the time about the need to close the savings gap in this country. In fact, Greenspan cited record low bank reserves as a justification for the easy money policy that he pursued. This policy would be magnified many times over if we were to discourage savings even more.

 

Largest debt-free publicly traded companies:

Microsoft
Google
Apple
QUALCOMM
Walgreen
Texas Instruments
eBay
Gilead Sciences
Caremark Rx
Stryker Corp.
Adobe Systems
Chicago Mercantile Exchange
Thermo Fisher Scientific
Broadcom

I'd say some of those are doing pretty well.

 

Its a lot harder for small business to raise equity. They rely heavily on debt. Also, just for the average person, higher interest rates make everything harder (from buying houses to cars, etc..)

This would have a bigger impact on smaller entities.