Do tax cuts for the rich hurt you personally?

[Mikkel]

Not sure what your point is.
The claim was that when there are tax cuts, and tax revenue goes down, social spending also goes down. This is patently false, as demonstrated by the figures I posted.

My point is that even if social spending DOESN'T go down when we institute tax cuts, that isn't necessarily a good thing. It means we run larger deficits and create a bigger national debt, which is, by most standards, bad. So even if people aren't being directly hurt from tax breaks, it is still bad for the country and the economy.

On the flip side, does raising taxes for the rich actually hurt anybody? It's hardly like the rich need that extra money to live. It might mean they'll have to take out a loan before buying their next yacht, but MOST people wouldn't consider that such a crime, don't you think? Those extra taxes can help pay for those social programs that continually cost more, regardless of tax breaks, and get the country out of debt.

 

[M14 Shooter]

My point is that even if social spending DOESN'T go down when we institute tax cuts, that isn't necessarily a good thing. It means we run larger deficits and create a bigger national debt, which is, by most standards, bad. So even if people aren't being directly hurt from tax breaks, it is still bad for the country and the economy.

Depending on any number of other factors, you might be right.
But, that depends on, well, any number of other factors.

On the flip side, does raising taxes for the rich actually hurt anybody? It's hardly like the rich need that extra money to live. It might mean they'll have to take out a loan before buying their next yacht, but MOST people wouldn't consider that such a crime, don't you think? Those extra taxes can help pay for those social programs that continually cost more, regardless of tax breaks, and get the country out of debt.

The less money the rich have, the less they can invest (in any number of ways) in the economy. The less they invest, the slower the economy. A slower economy hurts everyone.

 

[Mikkel]

The less money the rich have, the les they can invest (i any number of ways). The less they invest, the slower the economy. A slower economy hurts everyone.

That sounds exactly like Herbert Hoover's solution to the great depression. Guess what? It didn't work. Trickle down economics just doesn't work, no matter how many times you say it.

 

[M14 Shooter]

That sounds exactly like Herbert Hoover's solution to the great depression. Guess what? It didn't work. Trickle down economics just doesn't work, no matter how many times you say it.

Its worked each of the three times its been tried (1961+ 1981+ 2001+)

Fact of the matter is, poor people dont start business, employ people and invest in exapnding the economy -- rich people do. How do you give them more money to do this with? Lower their taxes.

 

[Engimo]

That sounds exactly like Herbert Hoover's solution to the great depression. Guess what? It didn't work. Trickle down economics just doesn't work, no matter how many times you say it.

Exactly. If you want to improve the economy, give breaks to those that are poorer. Anyone who has taken a basic macroeconomics course would know that the marginal propensity to consume is much higher for those with lower incomes than those with higher incomes. That is, there is a greater economic "efficiency" in giving (or taking less money from) to those that are poor.

Richer people have a tendency to save more of the money that they get (or purchase bonds), as opposed to poorer people who spend nearly all of their income on consumer goods/putting money back into the economy.

 

[M14 Shooter]

Exactly. If you want to improve the economy, give breaks to those that are poorer

I thought the "poor" and "middle class" carried the tax burdern?
If you cut their taxes, who will pay for all the social programs they use?
If the poor and middle class carry the burden, and you cut their taxes, what happens to the deficits?

who has taken a basic macroeconomics course would know that the marginal propensity to consume is much higher for those with lower incomes than those with higher incomes. That is, there is a greater economic "efficiency" in giving (or taking less money from) to those that are poor.

There's a lot more to growth than simple 'consumption'.
As consumption goes up, business must expand. Expansion of business necessitates capital. More capital means more investment; less capital means less investment. Less investment means less expansion.

ople have a tendency to save more of the money that they get (or purchase bonds), as opposed to poorer people who spend nearly all of their income on consumer goods/putting money back into the economy.

You men they have a greater propensty to invest in any number of ways. Investment only makes the economy stronger.

 

[Engimo]

I thought the "poor" and "middle class" carried the tax burdern?
If you cut their taxes, who will pay for all the social programs they use?
If the poor and middle class carry the burden, and you cut their taxes, what happens to the deficits?

If you want a stronger economy, cutting the taxes of the middle/lower class (while raising the taxes of the upper class, if you want to maintain social programs) is the most efficient way of doing it. Trickle-down or Supply-side economics is horrendously inefficient.

There's a lot more to growth than simple 'consumption'.
As consumption goes up, business must expand. Expansion of business necessitates capital. More capital means more investment; less capital means less investment. Less investment means less expansion.

Consumption produces capital. Ever hear of this thing called "profit"? If poorer people are spending more money, then firms have greater profits which can be used to invest back into the firm, in a much more direct way than through the rich.

You men they have a greater propensty to invest in any number of ways. Investment only makes the economy stronger.

No, the rich have the greatest propensity to propagate leakages in the economy - they purchase bonds and put money in savings accounts to a greater degree than poorer people do.

 

[Mikkel]

Its worked each of the three times its been tried (1961+ 1981+ 2001+)

Fact of the matter is, poor people dont start business, employ people and invest in exapnding the economy -- rich people do. How do you give them more money to do this with? Lower their taxes.

Wrong again.

As you can see from this lovely report with it's interesting graphs, there has been no correlation between tax cuts for the rich and economic growth, or an increase in average American prosperity:

http://www.rationalrevolution.net/war/trickle_down.htm

"There is no realistic way for “Trickle-Down” economics to work to increase the income of the working classes of America. In fact I am certain that the developers of the theory of “Trickle-Down” economics were fully aware of this and that “Trickle-Down” has in fact worked as intended. This means that the intent behind implementing “Trickle-Down” was to benefit the wealthiest Americans at the expense of working class Americans. “Trickle-Down” hasn’t failed, as many modern economists have suggested, it has succeeded in its goals, which is the increase of economic inequality and the shift of a greater portion of America’s wealth into the hands of the wealthiest Americans."

It was only intended to help the rich, and that's all it does. Nothing more.

 

[hipsterdufus]

Well, even then...

So, it went from 0.18% of the wealthy to 0.22%.

You make is sound like the wealthy not paying taxes is common, and after the tax cuts, it's pervasive. I guess you -could- say that the increase (+22%) is significant, but the number of wealthy not paying taxes (0.22%) is not.

That's if you just look at the proportion that pay zero taxes.
If you look at the whole picture, 162,000 of Americans earning over $200,000 a year were in the lowest tax bracket.

Among that high-income group, however, almost 83,000, or one in 33, paid less than a dime in taxes for every dollar of income. An additional 79,000 paid less than 15 cents. The average for all Americans was 13 cents.

http://www.nytimes.com/2005/07/03/business/03tax.html?ex=1137906000&en=3bb978af4229a56a&ei=5070

People earning more than $1 million in 2005 paid on average 11.2% of their income in taxes.

I don't know about you, but I pay a lot more than that!

http://taxprof.typepad.com/taxprof_blog/2005/12/tax_policy_cent_2.html

 

[M14 Shooter]

Wrong again.

As you can see from this lovely report with it's interesting graphs, there has been no correlation between tax cuts for the rich and economic growth, or an increase in average American prosperity:

Funny.
At a glance, I dont see anything regarding the effect of the tax cuts on economic growth; your report focuses on income.

Why are you using a study on income to try to disprove a claim regarding economic growth?

 

[M14 Shooter]

That's if you just look at the proportion that pay zero taxes.
If you look at the whole picture, 162,000 of Americans earning over $200,000 a year were in the lowest tax bracket.

http://www.nytimes.com/2005/07/03/business/03tax.html?ex=1137906000&en=3bb978af4229a56a&ei=5070

People earning more than $1 million in 2005 paid on average 11.2% of their income in taxes.

I don't know about you, but I pay a lot more than that!

http://taxprof.typepad.com/taxprof_blog/2005/12/tax_policy_cent_2.html

I'm assuming you're talking about the % of gross income to the total federal income tax paid.

I rarely pay over 5%. Right now, with a few deductions left to finalize, in 2005 I am at 4.9%. If you're paying more than 11.2% you're doing something very wrong.

 

[The Real McCoy]

I love watching one conservative toast a crowd of liberals in an economic debate.

Keynesian/demand-side/bull$hit economics are simply that: bull$hit. History has proven the effectiveness of supply-side/Reaganomics. Now if we can only slash gov't spending and balance the budget, we'll be in business.

 

[M14 Shooter]

I love watching one conservative toast a crowd of liberals in an economic debate.

Keynesian/demand-side/bull$hit economics are simply that: bull$hit. History has proven the effectiveness of supply-side/Reganomics. Now if we can only slash gov't spending and balance the budget, we'll be in business.

Yes.
If only the GOP controlled congress of 2006 was thje GOP-controlled congress of 1996. Right now, they remind me of the Dems, 1980-1994.

 

[Navy Pride]

80 percent of income taxes in this country are already paid by the top 5 percent of the wage earners............To say that tax cuts are only for the rich is left wing talking points and political spin..........

No one in his right mind or who knows about the tax cuts believe it.....

 

[ptsdkid]

LOL
What arbitrary income figure did you choose to arrive at that precise statistic?

****The arbitrary income figure I used to come up with that precise figure was 99.94%. Actually, I heard it from Walter Williams today filling in for Rush Limbaugh. Since all Conservatives are as honest as the driven snow--I'll lay money on the fact that Walter was telling the truth over the National airwaves. Wouldn't want the liberal ACLU attornies suing him for pulling a Dan Rather on us.


They don't HURT me, no. But they most definitely AFFECT everyone.

*****Look through the threads and you'll see others posting that the top 50% wage earners among us pay over 96% of the taxes in this country. So you must be praising these rich people for paying so much in taxes, while people like yourself either pay no taxes or are grateful enough to get a tax cut along with the rich people like Kennedy and Kerry.

 

[Kandahar]

****The arbitrary income figure I used to come up with that precise figure was 99.94%. Actually, I heard it from Walter Williams today filling in for Rush Limbaugh. Since all Conservatives are as honest as the driven snow--I'll lay money on the fact that Walter was telling the truth over the National airwaves. Wouldn't want the liberal ACLU attornies suing him for pulling a Dan Rather on us.

That doesn't answer the question. 99.94% is not an income, which is measured in dollars. Where did you come up (or he) come up with this definition of "rich"? It sounds to me like he just pulled a number out of his ass.

And if you think that "all conservatives are as honest as the driven snow" - especially those working for braindead idiots like Rush Limbaugh - you are such an idiot that I don't know if there's any hope for you. My suggestion is open a book, or read what INTELLIGENT people of all political views have to say, rather than the hate-filled garbage that Limbaugh spews.

*****Look through the threads and you'll see others posting that the top 50% wage earners among us pay over 96% of the taxes in this country.

I haven't disputed that the wealthy pay most of the taxes, so what's your point?

So you must be praising these rich people for paying so much in taxes,

Actually it's quite unfair. Taxes should be flat.

while people like yourself either pay no taxes or are grateful enough to get a tax cut along with the rich people like Kennedy and Kerry.

It'd be the latter. What's your point? Why are you always so eager to preach the Gospel According To Rush Limbaugh even when people agree with you?

 

[Stinger]

Look it up if you're curious.

You must have already if you are making a statement of fact, so let's see the supporting evidence.

It's a fact.

Not at this point.

How do rich people not pay taxes? For instance when they fill up their yatchs how do they not pay the federal fuel tax?

 

[ptsdkid]

That doesn't answer the question. 99.94% is not an income, which is measured in dollars. Where did you come up (or he) come up with this definition of "rich"? It sounds to me like he just pulled a number out of his ass.

And if you think that "all conservatives are as honest as the driven snow" - especially those working for braindead idiots like Rush Limbaugh - you are such an idiot that I don't know if there's any hope for you. My suggestion is open a book, or read what INTELLIGENT people of all political views have to say, rather than the hate-filled garbage that Limbaugh spews.

It'd be the latter. What's your point? Why are you always so eager to preach the Gospel According To Rush Limbaugh even when people agree with you?

*****What question was asked about my statement that 99.94% of the taxes paid in this country are paid by the wealthiest among us? I believe that fact has been repeated here numerous times.
Braindead idiots like Rush? Rush gives out more facts, more legitimate news, and more hard hitting facts in his first five minutes of each show--then the entire liberal media spews out in a week. Them the facts sport, and his 22 million a week listening fanfare helps to cement the notion that he is the best. The most listened to radio talk show in the history of the world, with no spin, no deception, and no bullshit--much to the chagrin of the weak-assed, anti-American, weasel-infested liberal contingent among us.
FYI--I read a current events book, or a historical book, or a political science book about every two days or so. I would just love to have you suggest an author or a particular book that I may just learn something from. Go ahead, knock yourself out sport. Who is your political idol? Don't tell me it's that anti-American Noam Chumpsky. Perhaps you've taken a liking to Michael Moore or Howard Dean. Whatever, you're a born loser.

 

[Befuddled_Stoner]

Is giving money to the rich, via tax breaks and such, a more efficacious boost to the economy than giving the same sum to the less affluent classes? As Engimo said, the poor have a greater propensity to consume, while the rich are more likely to make a few big purchases and curtail the money’s velocity. Doesn’t money given to the poor trickle up, through increased profits and such, much faster than it trickles down when given to the rich? So many years under the Bush administration makes me think that all the primo investment opportunities would be cashed by the flood of tax cuts, leaving no place to put that money but poor investments and bank accounts. Yes, more moola in the hands of the rich increases investment capital which then increases the number of people hired, but when does the benefit of yet more cuts for the rich taper off? I’m prone to thinking it already has, but I’d be willing to look at evidence to the contrary.

I know it is possible for the upper class to grow too big, ‘cuz it leads to aristocracy and things like the Great Depression, but is it possible for the middle class to grow too big? What would be the negative reverberations of increasing the middle class at the cost of the upper class? Could it possibly be worse than erroring on the side of giving too much money to the upper class at the cost of the middle? Are a few big businesses, fueled, I presume, mostly by the funds of the wealthy, inherently better than more small businesses, fueled by the money and efforts of the middle class?

Answering the poll, yes, tax cuts for the rich have hurt me. Congress recently decreased the funding for college tuition (making me pay more for my education) in order to offset budget deficits from decreased revenues.

 

[ptsdkid]

Is giving money to the rich, via tax breaks and such, a more efficacious boost to the economy than giving the same sum to the less affluent classes? As Engimo said, the poor have a greater propensity to consume, while the rich are more likely to make a few big purchases and curtail the money’s velocity. Doesn’t money given to the poor trickle up, through increased profits and such, much faster than it trickles down when given to the rich? So many years under the Bush administration makes me think that all the primo investment opportunities would be cashed by the flood of tax cuts, leaving no place to put that money but poor investments and bank accounts. Yes, more moola in the hands of the rich increases investment capital which then increases the number of people hired, but when does the benefit of yet more cuts for the rich taper off? I’m prone to thinking it already has, but I’d be willing to look at evidence to the contrary.

I know it is possible for the upper class to grow too big, ‘cuz it leads to aristocracy and things like the Great Depression, but is it possible for the middle class to grow too big? What would be the negative reverberations of increasing the middle class at the cost of the upper class? Could it possibly be worse than erroring on the side of giving too much money to the upper class at the cost of the middle? Are a few big businesses, fueled, I presume, mostly by the funds of the wealthy, inherently better than more small businesses, fueled by the money and efforts of the middle class?

Answering the poll, yes, tax cuts for the rich have hurt me. Congress recently decreased the funding for college tuition (making me pay more for my education) in order to offset budget deficits from decreased revenues.

**Let me start from your last statement and work backwards. Budget deficits are not a result of decreased revenues. Revenues have been steadily increasing for quite a while now. The deficits are a direct result of increased spending, and for that I do blame Bush and the Congress. I hope Bush will address that spending problem in his State of the Union speech.

I have a totally different take on your idea of our upper class. I see the upper class as being the hallmark of achievement or success--to be emulated by the middle and lower classes of society. The upper class (or rich) provide jobs for the middle and lower class among us. Bush's tax cutting initiatives involve a cut for all tax paying Americans, so everyone benefits. Those crying tax cuts for the rich either do so because of envy or because they are uninformed of the amount of taxes the rich pay in the first place.

The monies saved from the tax cuts by the rich, the middle class, and the lower class is reinvested back into the economy, thus making it the economic boon that we see today.

I think what your saying in your first paragraph is that too long of a tax cut in time will actually see the rich stop investing and start spending on frivolous or luxury items instead.
I need only to refer you back to the eighties when Ronald Reagan brought the top marginal tax down considerably (forget the percentages offhand) and we got to see an amazing economic boon. It's hard to fix or stop something that seems to be working well as planned.

 

[Stinger]

Fair enough:

Here's some data from the IRS in 2002 stated in the following article:



http://www.nytimes.com/2005/07/03/business/03tax.html?ex=1137906000&en=3bb978af4229a56a&ei=5070

Hmm

"On a worldwide basis, 2,551 such individuals and couples paid no tax in 2002, down from 2,875 in 2001, but up from 2,022 in 2000. There were 37 such examples in 1977, the first year the agency disclosed such data."


So it goes up and down but currently is going down as opposed to the claim made.

"The second measure, giving a fuller picture, was expanded income, which also includes money from sources like tax-exempt interest and untaxed Social Security benefits. By this measure, 5,650 well-to-do individuals and married couples paid no federal income tax in 2002, up from 4,910 in 2001 and 2,766 in 2000. There were 85 such examples in 1977."

OK so your gripe is we don't tax taxexempt bonds and all of SS benefits? That's your big gripe?

"The I.R.S. report said that "the most important item in eliminating tax" was taking income in the form of tax-exempt interest on state and municipal bonds."

Which pay less interest and carry less risk, do you suggest we outlaw these so the nasty rascally rich people, and in this case older retired people who have no income from labor but from such safe investments, pay more taxes?

"The four largest items that reduced income subject to taxation, the I.R.S. said, were miscellaneous deductions; interest paid on borrowing to finance investments; various tax credits; and large medical bills, which can be deducted once they exceed either 7.5 percent or 10 percent of adjusted gross income, depending on the taxpayer's circumstances."

All legal deductions. Deductions for losses and expenses which offset income. Also the wealthy give a lot to charity which they get deductions for. In fact most deductions are for things that the government wants us to do or engage in so if someone does enough of those to offset thier taxes what is the complaint?

Of course we can just go to a flat tax or an income tax.

 

[Stinger]

Is giving money to the rich, via tax breaks

Exactly how does that work? How do you give something to someone who already owns it?

and such, a more efficacious boost to the economy than giving the same sum to the less affluent classes? As Engimo said, the poor have a greater propensity to consume,

How about explaining that, how does a poor person "comsume more" than
a rich person?

while the rich are more likely to make a few big purchases and curtail the money’s velocity.

Like a big boat, that was sold by the dealer who employeed people, who had it trucked in which paid a trucker, who picked it up at the factory who paid people to make to it, which bought the materials from a company which paid people to make them and then he had it outfitted with radio's and engines and GPS systems and funiture and on and on and on.

Doesn’t money given to the poor trickle up, through increased profits and such, much faster than it trickles down when given to the rich?

No. But it we adopt your therory then why don't we tax the rich at 100% and really watch the economy take off.

I know it is possible for the upper class to grow too big, ‘cuz it leads to aristocracy and things like the Great Depression,

:rofl you think the Great Depression was caused by an aristocracy?

Answering the poll, yes, tax cuts for the rich have hurt me. Congress recently decreased the funding for college tuition (making me pay more for my education) in order to offset budget deficits from decreased revenues.

So you believe someone else should earn the money to pay for your college? And that government should take that money from them by force and give it to you?

 

[Engimo]

How about explaining that, how does a poor person "comsume more" than
a rich person?

By percentage. The Marginal Propensity to Consume is a percentage measure of how much of your total income is spent on consumption. A rich person, for example, might have a MPC of .5 while a poorer person would have an MPC of .9 or something like that, meaning that for every dollar given to a poor person, $.40 more is spent on the economy.

 

[Stinger]

By percentage.

Which is meaningless, we don't spend "percentages" we spend "amounts".

The Marginal Propensity to Consume is a percentage measure of how much of your total income is spent on consumption. A rich person, for example, might have a MPC of .5 while a poorer person would have an MPC of .9 or something like that, meaning that for every dollar given to a poor person, $.40 more is spent on the economy.

And if the rich person has $100,000 then he will spend $50,000 and if the poor person has $100 he will spend $9.

But then the rich person has also invested $30,000 in capital equipment and then employeed the poor person and combined capital and labor to create wealth which is divided into income for the poor person and a return on the investment of the rich person along with the taxes that are paid due to the economic activity.

Or we can adopt your plan and tax away all the money from the rich and give it to the poor, do you think that we will have a viable economy? How many rich people will start business and invest in equipment under your system to create jobs?

To me exactly were do you think rich people put their money, under the mattress?

 

[Engimo]

Which is meaningless, we don't spend "percentages" we spend "amounts".

No, it's not at all. If we're debating the efficiency of stimulating the economy, we get less out of a dollar given to a rich person than a dollar given to a poorer person. More of that dollar is guaranteed to go back into the economy when given to a poorer person. We're talking about per dollar, not totals.

And if the rich person has $100,000 then he will spend $50,000 and if the
Or we can adopt your plan and tax away all the money from the rich and give it to the poor, do you think that we will have a viable economy? How many rich people will start business and invest in equipment under your system to create jobs?

That's a cute straw man you've got there. When did I suggest or even hint at the idea that we should tax rich people 100%?

To me exactly were do you think rich people put their money, under the mattress?

In a sense, yes. That's the whole concept behind the MPC. Rich people have a lower MPC because the rest is saved. Investments, you see, count towards the MPC, while the leakages out of the economy count for the rest - purchasing bonds, placing money in savings accounts, etc.