In an attempt to try and be positive, in thinking about all the wonderfulness that was supposed to come from the Obama Health Care package, I received yet another emotional smackdown as to the garbage that the 2400+ page bill known forever as the Obama Care Bill. (You know, for a bunch of people who claim to want to save the environment, they sure wasted a lot of paper on this one...)
Yet another report has come out of one of the secret little parts of the bill no one knew to talk about because no one could read it before it was passed. Aparently one of the provisions that is in the bill is that anything a business purchases that is over 600 dollars will need to have a 1099 form filled out from the supplier and the purchaser and sent in with their taxes each year. According to this article small businesses will have to get the form from Apple if they buy a computer. A laundromat will have to file a form for their soap purchases from their supplier. Why all the paperwork?
Well, because the government estimates that 300 billion dollars a year in revenues are lost because people don't declare their taxes properly. In this way they feel they will make businesses pay more taxes. What they don't take into the equation is that someone down the line is paying taxes on these otherwise exempt items in the form of sales tax. This goes back to opening the door for Obama's socialist value added taxation. In the end this whole thing is a huge door, wide open, to higher taxation the likes that this country (outside of maybe Obama's dysfunctional home of Chicago) has ever seen.
No proof, just an estimate. So why is this in the health care bill then? Because this is part of how the government "guesses" that they can help pay for the whole program. So, just when you thought that individual tax payers are going to the be ones to bear the brunt of the burder, small businesses are going to be crushed either under the mounds of new paperwork, or in any possible additional value added taxation that is sure to come online through this whole thing. And to think, some people try to NOT pass off the health care bill as a socialist program....
Typical. When the government, owned by banks and corporate interests, tightens up tax enforcement they always do it on the little guy. The big corporations pay no taxes at all because they have written loopholes into the laws that exempt them. The wealthy pay a far smaller percentage of their income in taxes than the rest of us. It's corruption, not Democrat vs. Republican or conservative vs. liberal.
ReplyDeleteVAT is an interesting idea, but we don't need it. If we enforced the tax law on corporations, repealed the Reagan and Bush tax cuts on the rich, cut the "defense" budget by 50% and removed the salary cap on social security, we could get the government out of the red without raising taxes on ordinary Americans. Of course, that will never happen so we can blame the other party, claim things are socialist or make up some other bogus myth, but it's really corruption. The love of money is the root of our government's evil.
Taxing businesses out of their money to pay for government programs is very much socialist Charles. To borrow your terms, it is cronnie socialism. rather than just take it over, something the people are decidedly against, they are slowly leading the people down the path towards socialism.
ReplyDeleteThe pied piper story is quite relevant here. Sure it is corruption but in my mind whether you call it corruption or socialism they accomplish the same end. In both cases the government does what is best for government, government gets bigger, the people are taxed heavier, till the government takes over industry after industry.
I suppose you are right in someways Charles but I have yet to determine how what you believe is the solution is any different than what you are complaining about. You don't like corrupt government because they take the money away from the people... yet under a socialist government the government is still taking the money away from the people accept they are not going through the back door to get it. Either way the people are screwed out of the rewards for their labor.
Slowly the IRS has become a socialized accounting firm. At some point there will be so many government forms that each business will have to fill out the government will be our supervisors running every aspect. Its like the movie Office Space but on a governmental level.
Taxing big business to pay for social programs is a liberal and socially responsible thing to do. Taxing small business is extremely counterproductive. When the government fails to distinguish between the two and imposes the same taxes and regulations on Mom & Pop stores as on Exxon-Mobil, then you can be really sure that the tax law in question was written by lobbyists.
ReplyDeleteThe difference between corrupt government taxing people and socialist governments (hypothetically since we've never had one) taxing people is that in the former case, the tax burden falls on lower and middle income people and the revenue is used to line the pockets of big business through giveaways, corporate welfare, sweetheart contracts, and huge programs that provide no real benefit to the nation. In the latter case, the tax burden falls on the wealthy and the large corporations and the revenue is used to improve the lives of ordinary citizens through access to health care, education, and projects that actually provide benefit to the nation. The other difference is that crony capitalism is run by business for business and the public has no say in it. In a social democracy, the people through their representatives decide how money is raised and spent.
We could certainly simplify the IRS code. No other nation has a tax code anywhere near as complex as ours. All we need to do is eliminate all the exclusions, deductions, and other tricks and simply assess a progressive percentage of income from all sources so that people whose incomes are near the poverty level pay nothing and those who are making millions pay 90% or so.
Charles-
ReplyDeleteThe following quote from your last response has reminded me of some ideals I have always wanted a socialist to clarify for me.
"All we need to do is eliminate all the exclusions, deductions, and other tricks and simply assess a progressive percentage of income from all sources so that people whose incomes are near the poverty level pay nothing and those who are making millions pay 90% or so."
Socialists claim that their systems do not encourage mediocrity in citizens... but if we implemented the tax system you outlined, then citizens receive the best rewards when they do the least. Don't work harder at your job because the more you make, the more the government takes from you. Don't start a business because your family will not profit from it, but you will essentially become a welfare check for your employees. Why invent something new, you will receive no added benefit for your hard work.
Socialists scream equal treatment for all citizens, but that is not true with what you just stated. The rich will be punished because they have money. The rich either worked hard to get their money, or they were born to it. Either way you discriminate because they worked harder than everyone else, or because they were born to the wrong parents. Seems pretty hypocritical to fight against hatred and discrimination because someone was born with a certain skin color, but support hatred and discrimination towards those born to rich parents.
Your tax system would tax the rich into poverty. It would remove the wealthy class, but instead of making everyone middleclass, the middleclass would then be the wealthy ones, and would get all their money taxed away and then everyone will be equally poor. No one will dare try to improve themselves or their situation.
Why not support a flat tax or a system where only purchases are taxed, that way even drug dealers end up paying taxes as well when they buy their Mercedes and designer clothes or authentic NBA jerseys? Those seem much more fair to me but I have yet to hear a socialist support these ideas.
The tax system I outlined was pretty much exactly the one in place from the 1940's through the early 1970's. During that period the marginal tax rate on the wealthiest Americans was 90% or more and we enjoyed great prosperity and a high standard of living without the extreme disparities in wealth and income we have today.
ReplyDeletePerhaps we should talk a bit about tax rates. A progressive tax doesn't mean that all of your income is taxed at the highest rate, it means that the income over a particular amount is taxed at that rate. Let's take as an example a tax system that reached it's maximum of 90% when income reaches $2 million. Stephen Hemsley CEO of United Health Care "earned" $102 million in 2009. The $100 million of his income over $2M would be taxed at 90% leaving him practically destitute with only some $10-12 million to feed his family.
The mistake a lot of conservatives make is assuming that wealthy people will use their excess income to invest and thus create jobs - the old 'rising tide lifts all boats' theory. In fact, they will probably do their best to avoid all future tax and make as much money as possible on derivatives, speculative investments, and other useless gambling. If we had a tax rate this high, the money currently wasted on executives would probably be reinvested in the company and might create some jobs.
Wow Charles that was a dodge of a response. Your explaination failed to reconcile the hypocrisy in your stance. Your plan prmotes slothful citizenship. It is counter productive.
ReplyDeleteCharles-
ReplyDeleteYou still will encourage people to earn less, so they can keep more of their money. If I know I will not be taxed as long as I do not make more than $25,000.00 why would I earn one penny more and be subject to, say, even a 1% tax that would then give me less money than if I had earned the $25,000.00? by earning that penny I just lost $250.00.
I personally do not think that rich people will reinvest their money into jobs. I really don't care if they do or not. They earned or maybe their grandfather earned it and it should stay as long as possible in their control. i think all political ideals believe in providing for their posterity, I just don't understand why anyone would feel good about taking someone elses' hard earned money to support another person's posterity. I will work as long as I can to provide an inheritance to my children and if it is large enough to support my family the next 6 generations then that is wonderful. If not, then my kids will have to do what I could not. I will not steal the money from someone elses child.
Again, please explain to me how socialistic systems will not encourage a true welfare state, where people do as little as possible so they can get more money?
Another of the common fallacies of conservative economic thought is the idea that people will work as little as possible given the opportunity and that providing a social safety net or a progressive income tax will cause a reduction in productivity. It simply isn't the case as a casual look at any Western European country will tell you.
ReplyDeleteAs long as there are decent jobs available, people will work to make their lives better and provide a better life for their family regardless of whether there is a social safety net or whether it puts them into a higher tax bracket. A well constructed progressive income tax system won't have the sudden huge steps (per the Reagan "reforms") but will very gradually increase the tax burden as income increases and will exempt completely those whose income is barely able to cover the necessities of life.
You mention inheritance as well Crayon Face, and that's another major failure of conservative economic policy. Sure if you have created a good successful small business or a successful family farm, you should be able to pass that on to your children intact, but why should Bill Gates be permitted to hand his kid several hundred billion dollars? We had a very fair estate tax at one point but conservatives, misled as usual by wealthy interests, insisted that we allow multi-millionaire to hand over their riches to their children free of taxes. It was and is a dumb idea. The children of the very wealthy already have a leg up, they don't need to become filthy rich when daddy dies. We need to start thinking about the good of the country instead of pretending that we are all independent individuals who are each entitled to grab whatever we can and hold on to it regardless of the fate of our fellow citizens or our nation.
At what point will you stop coveting your neighbor's money? Why is Bill Gates money public property and not yours? Why do you hate rich people?...and don't say you don't because you think it is your right to spend their money. They may be selfish in keeping their money to themselves, but how are you any different? You are trying to take their money and spread it around so YOU get some. You can claim you want it for the underprivileged but admit that you wish life was easier for you too.
ReplyDeleteWhy don't you want money from movie stars? They have more money than most business owners and don't work nearly as hard for it? Or do you not want to piss off the supposed supporters of liberal ideals?
The fact that in this country we can grab want we can is what makes us what we are. The pilgrims and all immigrants since have come here because there is no limitation placed on you because of your birth. No King to tell you how to worship God, no social caste that kept you from accomplishing your dreams. No one taking your livelihood and saying it belongs to someone else. God Bless America, Land of the FREE!