30 year plan to pay off debt (1 Viewer)

[laska]

restore Bush tax cuts of 2001/2003 over 4 year period

eliminate corporate and capital gains taxes over 4 year period

raise taxes on income over $85,000 by 10 percent over 4 year period

lower f.government spending by 2.5 percent every year for 20 years and then freeze real spending for the next 10 years.

raise SS age age to 75 for those 55 and younger and raise the SS age two years and means test immediately.


SOME BROAD IDEAS FOR SPENDING CUTS INORDER TO MAKE THESE FUTURE DECLINING BUDGETS:

eliminate all corporate subsidies

eliminate all agricultural subsidies

create structure to foster healthy lifestyle to reduce health costs

smart defense cuts

create structure to drastically reduce pork

create structure to drastically reduce welfare corruption

create structure to drastically reduce buracratic inefficiency

support structures that facillitate international free trade

 

[Iriemon]

restore Bush tax cuts of 2001/2003 over 4 year period

eliminate corporate and capital gains taxes over 4 year period

raise taxes on income over $85,000 by 10 percent over 4 year period

lower f.government spending by 2.5 percent every year for 20 years and then freeze real spending for the next 10 years.

raise SS age age to 75 for those 55 and younger and raise the SS age two years and means test immediately.


SOME BROAD IDEAS FOR SPENDING CUTS INORDER TO MAKE THESE FUTURE DECLINING BUDGETS:

eliminate all corporate subsidies

eliminate all agricultural subsidies

create structure to foster healthy lifestyle to reduce health costs

smart defense cuts

create structure to drastically reduce pork

create structure to drastically reduce welfare corruption

create structure to drastically reduce buracratic inefficiency

support structures that facillitate international free trade

Those are all good thoughts. It is easy to balance the budget and pay down the debt. All it takes is some politicians with the guts to do it. That is what we have been missing in Washington for the past 5 years.

 

[128shot]

Those are all good thoughts. It is easy to balance the budget and pay down the debt. All it takes is some politicians with the guts to do it. That is what we have been missing in Washington for the past 40 years.

I fixed a little error in there

 

[Kandahar]

raise taxes on income over $85,000 by 10 percent over 4 year period

*cringe*
That would most likely result in a net decrease in federal tax revenue.


The other ideas are all excellent though, and would do a great deal to reducing our debt. If I may add a couple:
Sell off unused public property (including unused foreign military bases), which is estimated to be between $10-20 trillion.
Privatize social security and medicare, so that our government isn't crippled by rising entitlement spending over the next few decades.

 

[Iriemon]

I fixed a little error in there

LOL -- I might agree -- but the Govt's budget was (miraculously) balanced and in surplus as of 2000, brief as tho' the moment was.

 

[gwynn]

eliminate corporate and capital gains taxes over 4 year period

raise taxes on income over $85,000 by 10 percent over 4 year period

Why both? Capital gains recipients and high income earners are usually the same people. It is possible for anyone with a reasonably high income to make a fortune off of capital gains alone, I do not see why you would eliminate taxes on this.

eliminate all corporate subsidies

eliminate all agricultural subsidies

This can be done, but must be done over a long period. For example, agriculture in California receives huge water subsidies. In order to eliminate them you would need to have a limited period subsidy which paid for part of the cost to switch to drip irrigation. Then you could phase water subsidies out over a few years. To do otherwise would just bankrupt them.

create structure to drastically reduce pork

This is probably the most important issue. Unfortuneately I think it will take reform of the electoral system and campaign finance to do away with government spending and subsidies to areas that do not need them. Both seem to be non-starters in Washington.

 

[laska]

Why both? Capital gains recipients and high income earners are usually the same people. It is possible for anyone with a reasonably high income to make a fortune off of capital gains alone, I do not see why you would eliminate taxes on this.

The elimination of capital gains tax should increase the incentive to invest in capital, and it should benefit long term economic growth and increase the government tax receipts, at least in theory it seems to me. It also seems that capital gains is a difficult tax to make fair because of inflation and the reflection of true income as some investments will lose money(sort of like taxing those that gamble at casinos.) My thought process on raising the income rates on the higher income is that at least not all of this taxable income is used to invest in capital as with the capital gains tax, some would be used to buy goods and services, and these taxes would not only pay off the governments obligation, but it stays in the economy as redistributed wealth, other people will still use this income to buy goods and services and invest in capital. I am not confident on this as I do not have a clear knowledge of the market system yet. I could definately be missing something. Just took an economic class recently and have been trying to learn this stuff. I guess my main overall goal after paying off debt would be to have a flat 5 percent federal tax, no capital gains tax, local and state governments combined 5 percent tax, much smaller and more focused, efficient government with balanced budgets.

 

[Iriemon]

The elimination of capital gains tax should increase the incentive to invest in capital, and it should benefit long term economic growth and increase the government tax receipts, at least in theory it seems to me. It also seems that capital gains is a difficult tax to make fair because of inflation and the reflection of true income as some investments will lose money(sort of like taxing those that gamble at casinos.) My thought process on raising the income rates on the higher income is that at least not all of this taxable income is used to invest in capital as with the capital gains tax, some would be used to buy goods and services, and these taxes would not only pay off the governments obligation, but it stays in the economy as redistributed wealth, other people will still use this income to buy goods and services and invest in capital. I am not confident on this as I do not have a clear knowledge of the market system yet. I could definately be missing something. Just took an economic class recently and have been trying to learn this stuff. I guess my main overall goal after paying off debt would be to have a flat 5 percent federal tax, no capital gains tax, local and state governments combined 5 percent tax, much smaller and more focused, efficient government with balanced budgets.

Fallacious argument used to justify lowering taxes for the very wealthy, IMO. A good reason why guys like Kerry and Cheney only pay 13% tax rate on their income.

It *may* be true that lower taxes on capital gains tax would encourage more investment. So what? Lower taxes on income would encourage more work. Why not lower the SS tax instead? Poor folk can't afford to invest, rich folk do that. Why should they pay lower tax rates? That is a regressive tax system.

After repeal of the Estate tax, and repeal of the capital gains tax, you have the scenario where someone who has done nothing more in life other than having the talent and hard work of being born into the right womb being in the taxed preferred situation of receiving their inheritance tax free and receiving the investment income tax free. This person gets a to live a tax free existance. Which is great, except everyone else has to pay higher taxes to make of for the free loader.

Why should our society give special preference to those folks? Seems to me, if anyone, society should be giving tax breaks to people who go out and bust their ass working.

 

[laska]

Fallacious argument used to justify lowering taxes for the very wealthy, IMO. A good reason why guys like Kerry and Cheney only pay 13% tax rate on their income.


It *may* be true that lower taxes on capital gains tax would encourage more investment. So what? Lower taxes on income would encourage more work. Why not lower the SS tax instead? Poor folk can't afford to invest, rich folk do that. Why should they pay lower tax rates? That is a regressive tax system.

If it works in theory, and I am not knowledgabele enough to know if it really does, then the poor benefit by a little bit more downward pressure on prices as greater investment in capital should create greater efficiency in producing goods and services. The poor also may have retirement plans and houses so they would also benefit. Greater investment in capital increases the ability of creating greater wealth, which raises standards of living across the board and increases tax receipts. The negative is the rich will not pay their fair share of taxes. Or we can make sure they do and the rest of us will also pay more in higher prices, lower government tax receipts, lower income in retirement plans, and lower worth in home investment.


It seems to me there is a thresh hold where higher taxes become an incentive problem and the taxes would actually lower tax receipts. Where is the threshold I am not sure.

I also must say I am uncomfortable with the plan I put forth as I do not like progressive or regressive tax systems. Maybe eliminate the ten percent tax increase, and tax capital gains at ten percent if the capital gains is over $200,000 in a given year would be more fair.

 

[laska]

A few changes to my original plan.

A flat tax with no deductions of 10 percent on the first $28,000 of income, 18 percent on income between $28,000 and $85,000, and 38 percent on income that is over $85,000. So someone making $100,000 would pay ten percent on the first 28,000, and so forth. These are just estimated rates that I figured would be in the ballpark of needed government tax receipts.

elimination of corporate tax

elimination of capital gains tax except on income above $200,000 and then 10 percent on this.

2.5 percent decrease in spending each year for twenty years.

pay off debt as quickly as possible and then lower tax rates.

 

[Iriemon]

A few changes to my original plan.

A flat tax with no deductions of 10 percent on the first $28,000 of income, 18 percent on income between $28,000 and $85,000, and 38 percent on income that is over $85,000. So someone making $100,000 would pay ten percent on the first 28,000, and so forth. These are just estimated rates that I figured would be in the ballpark of needed government tax receipts.

elimination of corporate tax

elimination of capital gains tax except on income above $200,000 and then 10 percent on this.

2.5 percent decrease in spending each year for twenty years.

pay off debt as quickly as possible and then lower tax rates.

I think you are in the ballpark, this coupled with a reasonable spending cut (maybe 5% across the board) would come pretty close to balancing the budget, I reckon. You don't need to cut spending after that, just level it out and economic growth will create a surplus from increased tax revenues.

This is not a "flat" tax, however. A flat tax applies the same rate to all levels of income.

Why should folks who get their income from investments (primarily the very rich) get a big tax break compared to those who work for their money? Why should a worker pay up to 38% so a trust fund baby pays only 10%? Make the trust fund baby pay the same rate of tax as folks who work, and you might be able to drop that 38% rate a couple points.