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styndall


Feb 11, 2012, 7:27 PM
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guangzhou wrote:
petsfed wrote:
Funny but true:

My dad heard that argument from one of his coworkers in the private sector and he replied "I did!"

And his coworker was all kinds of happy for him until my dad said "So my pay tripled, but my work load and job description remained unchanged, and now the company I work for is billing the government for 4 times what the government was paying me in the first place, for the SAME JOB".

My dad's a pretty conservative guy (we don't talk about social issues around him, for instance), but he's spent the last 30 years working in infrastructure in one fashion or another, and he believes that privatization and contracting has made it incredibly wasteful.

It is true though that you can triple your income by switching to the private sector, so it baffles me that people complain of government incompetence when the fact remains that the government can afford to retain only the least competent employees.

I don't agree that the government only retains the least competent. Some very dedicated public service workers out there who could be making much more in the private sector bu choose not to.

Your dad's job is a good example. Yes, the private sector is charging 4 time what he made, but the government is still saving money by contracting out because of other expenses associated with government employees. (Retirement, medical, and other )

In America, we pay Federal Tax, State Taxes often, County Taxes, Property taxes, and then pay sales tax on good we buy. For our taxes we get the privileged of paying high tuition at State Universities, deteriorating Infa structure because the Federal government has to spread the fund across the entire country, and other issues to long to list.

Well, we sort of stopped paying much in the way of taxes - recall that this is the state of income taxes in the US:



This is a sort of 'get what you pay for' situation. Or, more accurately, it's a 'defund government agencies until they can't do their jobs, then use that fact to justify further stripping them of funding' situation.


petsfed


Feb 11, 2012, 9:52 PM
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guangzhou wrote:
Your dad's job is a good example. Yes, the private sector is charging 4 time what he made, but the government is still saving money by contracting out because of other expenses associated with government employees. (Retirement, medical, and other )

You might've noticed that he got out of state work in 1987. When retirement, medical and all of that other shit was standard for all engineers, private or public. I'm willing to concede that wages don't reflect all of the cost of employing somebody, but if my Dad's state benefits in 1987 were around 3 times as much as he was getting paid at the time, we sure as hell weren't seeing them. I actually recall hearing my dad say, while I was in high school, that hourly billing for him worked out to be around $300/hr. That meant he was worth $600,000 a year to that company. Of course, his wages were less than a sixth of that. I also know, from having been party to discussions about how much our insurance and retirement packages were actually worth if we had to pay out of pocket, that it wouldn't cost the company even a third of that hourly billing total, even without the volume discount on insurance packages that they got.

So no, try again.

As far as budget shortfalls go, we were doing well circa 1999, but I think I already pointed to the reason our infrastructure fell into disrepair: people decided they didn't like paying for government services, and said "gosh, when was the last time I heard about a bridge collapsing? I don't think all the money we put into repairs actually does anything!"

Can you imagine if one of your employees said "Oh, the roof never leaks, why are we paying the repair guys to work on it?"? Honestly, if I hired someone that dumb but didn't realize it at the time, I'd turn a critical eye on everything I'm doing, just to make sure that I'm not also consistently showering with a plugged in toaster.

We have seen catastrophic tax cuts, mostly to shore up support from people who apparently can't plan for their next birthday party, let alone think about what they're leaving to their grandkids.


Partner j_ung


Feb 12, 2012, 6:05 AM
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styndall wrote:

I don't understand this graph. This appears to say that during several years there were people paying more then 90% of their income in taxes.


johnwesely


Feb 12, 2012, 11:41 AM
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j_ung wrote:
styndall wrote:
[image]http://yglesias.thinkprogress.org/wp-content/uploads/2009/03/top_rates.jpg[/image]

I don't understand this graph. This appears to say that during several years there were people paying more then 90% of their income in taxes.

It is the top marginal tax rate, so 90% of their income above a certain level.


styndall


Feb 12, 2012, 12:07 PM
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j_ung wrote:
styndall wrote:
[image]http://yglesias.thinkprogress.org/wp-content/uploads/2009/03/top_rates.jpg[/image]

I don't understand this graph. This appears to say that during several years there were people paying more then 90% of their income in taxes.

Yeah, sorry - it's the top marginal rate, not the actual percentage of income people paid in taxes.


Partner j_ung


Feb 12, 2012, 12:37 PM
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Ah, got it. Duh. Thanks.


guangzhou


Feb 12, 2012, 9:07 PM
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Re: [petsfed] So happy Mitt will be president [In reply to]
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In reply to:
Your dad's job is a good example. Yes, the private sector is charging 4 time what he made, but the government is still saving money by contracting out because of other expenses associated with government employees. (Retirement, medical, and other )

In reply to:
You might've noticed that he got out of state work in 1987. When retirement, medical and all of that other shit was standard for all engineers, private or public. I'm willing to concede that wages don't reflect all of the cost of employing somebody, but if my Dad's state benefits in 1987 were around 3 times as much as he was getting paid at the time, we sure as hell weren't seeing them. I actually recall hearing my dad say, while I was in high school, that hourly billing for him worked out to be around $300/hr. That meant he was worth $600,000 a year to that company. Of course, his wages were less than a sixth of that. I also know, from having been party to discussions about how much our insurance and retirement packages were actually worth if we had to pay out of pocket, that it wouldn't cost the company even a third of that hourly billing total, even without the volume discount on insurance packages that they got.

Let's start with a state paying retirement benefits and medical insurance for 20 t0 30 years based on what their employees earned at the time of retirement.

Private sector, the retirement funds get invested in various pension plans and 401 are are paid out as they go. Once you retire,t he company no longer pays you, the retirement package take over. (Usually based on investments).

Private sector then also has to use some of it's revenue from that billing from all the other support, secretaries, admin staff, insurance, marketing, the list is petty long.

In reply to:
So no, try again.

Try what exactly?

To convince you the government is bad at control it's budget. Even the government knows it. Talk to any federal employee about all the measure initiated every year to control fraud wasted and abuse.

The study of Boston infrastructure has been redone a dozen or so times now. The study cost millions of U.S. dollar every-time and comes up with the same results. Fix the infrastructure. What does the government do, institute another study to investigate the result of the previous study, AGAIN.

In reply to:
As far as budget shortfalls go, we were doing well circa 1999, but I think I already pointed to the reason our infrastructure fell into disrepair: people decided they didn't like paying for government services, and said "gosh, when was the last time I heard about a bridge collapsing? I don't think all the money we put into repairs actually does anything!"

Budget shortfall started before 1999, the effects were just being felt by the public in 1999. Actually, also in 1989 just prior to the first Gulf War.

In reply to:
Can you imagine if one of your employees said "Oh, the roof never leaks, why are we paying the repair guys to work on it?"?

My business doesn't have a full time repair or maintenance guy. We source out the work as needed. Why, because a full-time repair or maintenance guy would have nothing to do 99% of the time.

The government on the other hand would have those repair guys all the time just in case, then when the work needed to be done, they would source half of it out because the private sector could do it more efficiently and faster.

If more money led to a more efficient and streamlined government, I would be happy to pay higher taxes at the Federal Level, but I don't believe more money will fix how the government make decision.

Infrastructure is a good example. Money is one part, but politicians also don;t want to be known as the guy who's cause all the rush traffic delay on the bridges and tunnels.

Politicians don't want want to be spending money on something mundane like fixing infrastructure because the general public wouldn't care and would complain about all the money they are spending on a bridge.

In reply to:
Honestly, if I hired someone that dumb but didn't realize it at the time, I'd turn a critical eye on everything I'm doing, just to make sure that I'm not also consistently showering with a plugged in toaster.

If one of my employees didn't understand why I did regular maintenance inspections or work, I would teach him why instead of being overly critical. Not everyone can afford to stay in Universities for nearly a decade studying what is happening in the world and studying how to do it theoretically correctly. Some people actually have to live in the real world instead of academia's version.

In reply to:
We have seen catastrophic tax cuts, mostly to shore up support from people who apparently can't plan for their next birthday party, let alone think about what they're leaving to their grandkids.


Allfred


Feb 13, 2012, 5:34 AM
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Re: [j_ung] So happy Mitt will be president [In reply to]
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j_ung wrote:
styndall wrote:

I don't understand this graph. This appears to say that during several years there were people paying more then 90% of their income in taxes.

Check out this link. put 5,000,000 in the salary box and watch the effective tax rate (listed below the year) change as you scroll left and right through the years.
http://www.usatoday.com/...x-rates-spending.htm


petsfed


Feb 13, 2012, 8:19 AM
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guangzhou wrote:
Try what exactly?

The date when my father transitioned from state employment to private employment is critical, since that's when retirement plans in the private sector were still (mostly) deferred payment, the same as a state employee. And it still remains the case that an equivalent engineer in the private sector can make quite a bit more than one in the public sector, more even than the benefit gap would reflect.

Unrelated note, who is attempting to commit fraud on infrastructure contracts? Not in the sense of "prove it!" but rather is it the government workers or the contractors submitting bids that are committing fraud?


scrapedape


Feb 13, 2012, 4:48 PM
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Most socially awkward president since....?

http://www.youtube.com/...mw&feature=share


Gmburns2000


Feb 13, 2012, 5:14 PM
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Little known fact about Romney: he declined his salary in his first year as governor of MA. This decision surprised the shit out of Lt. Gov Kerry Murphy Healey, who didn't want to give up her salary. She did it anyway in the end.

He didn't need the salary, of course, so it didn't matter much to him, but the fact of the matter was that he cut his own budget before he cut anyone else's. So there's one instance where a govt employee definitely made less than a private-sector employee for sure.


curt


Feb 13, 2012, 5:30 PM
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Gmburns2000 wrote:
Little known fact about Romney: he declined his salary in his first year as governor of MA. This decision surprised the shit out of Lt. Gov Kerry Murphy Healey, who didn't want to give up her salary. She did it anyway in the end.

He didn't need the salary, of course, so it didn't matter much to him, but the fact of the matter was that he cut his own budget before he cut anyone else's. So there's one instance where a govt employee definitely made less than a private-sector employee for sure.

Of course, John F. Kennedy (a Democrat) did the same thing 50 years ago as president of the United States.

Curt


Gmburns2000


Feb 14, 2012, 3:55 AM
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curt wrote:
Gmburns2000 wrote:
Little known fact about Romney: he declined his salary in his first year as governor of MA. This decision surprised the shit out of Lt. Gov Kerry Murphy Healey, who didn't want to give up her salary. She did it anyway in the end.

He didn't need the salary, of course, so it didn't matter much to him, but the fact of the matter was that he cut his own budget before he cut anyone else's. So there's one instance where a govt employee definitely made less than a private-sector employee for sure.

Of course, John F. Kennedy (a Democrat) did the same thing 50 years ago as president of the United States.

Curt

Yeah, I knew it wasn't a new idea, but I still think it's a rarity. However, in the spirit of his brother, Ted Kennedy used to pay for his Senate staff out of his own pocket so that he could keep talent around him. It was his belief that a govt salary wasn't enough to keep them around for more than a few years.


scrapedape


Feb 14, 2012, 5:06 AM
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Gmburns2000 wrote:
Ted Kennedy used to pay for his Senate staff out of his own pocket so that he could keep talent around him. It was his belief that a govt salary wasn't enough to keep them around for more than a few years.

When you talk about a Kennedy wanting to "keep talent around him," I have to wonder just what that means...


traddad


Feb 14, 2012, 5:18 AM
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Just a personal observation where N=1: My mom-in-law is a staunch anti-Obama conservative. She opined this last weekend that she was going to sit this election out. She called the Republican field a "bunch of clowns" and heaped a particular ration of shit on Mitt. As a working class Republican, she has no faith that Romney even thinks about working class people, much less gives a shit.

Methinks this will be a HUGE issue for this guy:


Also. Too:


Oh yeah...she thinks Santorum's overt religiousity is off-putting and scary, to say the least.


Allfred


Feb 14, 2012, 5:41 AM
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traddad wrote:
Just a personal observation where N=1: My mom-in-law is a staunch anti-Obama conservative. She opined this last weekend that she was going to sit this election out. She called the Republican field a "bunch of clowns" and heaped a particular ration of shit on Mitt. As a working class Republican, she has no faith that Romney even thinks about working class people, much less gives a shit.

Methinks this will be a HUGE issue for this guy:
[image]http://www.batterypark.tv/wp-content/uploads/2012/01/romney-bain-capital-money-shot_0-crop-285x300.jpg[/image]

Also. Too:
[image]
http://2.bp.blogspot.com/-e2bapOTsRx0/Tygqxtf-FeI/AAAAAAAAAZU/4hBQrbZmHjk/s1600/I_ride_inside_2_nate_christensen_flickr.jpg[/image]

Oh yeah...she thinks Santorum's overt religiousity is off-putting and scary, to say the least.

These guys were thinking the same thing. From Sunday and Monday:

krugman wrote:
For something has clearly gone very wrong with modern American conservatism.

...tinfoil hats have become a common, if not mandatory, G.O.P. fashion accessory.

...How did American conservatism end up so detached from, indeed at odds with, facts and rationality? For it was not always thus. After all, that health reform Mr. Romney wants us to forget followed a blueprint originally laid out at the Heritage Foundation!

My short answer is that the long-running con game of economic conservatives and the wealthy supporters they serve finally went bad. For decades the G.O.P. has won elections by appealing to social and racial divisions, only to turn after each victory to deregulation and tax cuts for the wealthy — a process that reached its epitome when George W. Bush won re-election by posing as America’s defender against gay married terrorists, then announced that he had a mandate to privatize Social Security.

Over time, however, this strategy created a base that really believed in all the hokum — and now the party elite has lost control.


http://www.nytimes.com/...e-syndrome.html?_r=1

friedman wrote:
one wonders whether the G.O.P. shouldn’t just sit this election out — just give 2012 a pass.

...There’s a reason for that: Their pile is out of date. The party has let itself become the captive of conflicting ideological bases: anti-abortion advocates, anti-immigration activists, social conservatives worried about the sanctity of marriage, libertarians who want to shrink government, and anti-tax advocates who want to drown government in a bathtub.

http://www.nytimes.com/...r=rssnyt&emc=rss


scrapedape


Feb 14, 2012, 8:18 AM
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traddad wrote:
Methinks this will be a HUGE issue for this guy:


What's the big deal? It's not like they were using them to light their cigars.


flesh


Feb 15, 2012, 1:02 AM
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Allfred wrote:
j_ung wrote:
styndall wrote:
[image]http://yglesias.thinkprogress.org/wp-content/uploads/2009/03/top_rates.jpg[/image]

I don't understand this graph. This appears to say that during several years there were people paying more then 90% of their income in taxes.

Check out this link. put 5,000,000 in the salary box and watch the effective tax rate (listed below the year) change as you scroll left and right through the years.
http://www.usatoday.com/...x-rates-spending.htm

I'm sure that most business owners never paid 90% effective. If tax rates were even close to that high, every business would be focused on finding each and every loophole. Also, for personal income, this would cause business owners to contribute an inordinate amount of money to the tax defered retirement accounts. It's possible to contribute hundreds of thousands a year, legally, tax defered as a business owner. There would be alot more tax fraud as well.

Economically, this would be horrible. The cash markets would be overrun and the people who truly needed to earn money on their cash, savings, cd's etc. would get no return. A larger issue is that the business owners would have access to substantially less cash to invest into growing/expanding/starting companies. This would be bad for everybody, long term. Anywhere over a 30% effective rate I'd guess would throw business owners into a frenzy and businesses would be collapsing left and right, in this economy where many businesses are struggling, barely making it. All anyone would think about was how to find new tax loopholes, we would find a way to pay less, it would become one of our biggest cost cutting departments within our companies. This would create more inefficiencies/costs.

The world is much different now. Business is global, because of internet and insanely cheap international calling. We must compete with other countries, not to ensure that we remain at the top, but because if we don't, we will lose what we already have.

I've had a hypothetical 50% plus effective rate conversation with a number of my close friends, most business owners, guess what we all agree on?

If it happened, we would relocate to a country with low rates. We would continue to do business in the us from another country. We make great money, but not crazy, mitt money. Many biz owners who have a model that would allow them to move, would. If you could move somewhere and put an extra million a year in your pocket, would you? Many will, obviously. There goes billions more leaving our country. Like manufacturing to China, what if it was banking, internet, or any business that can be done by phone overseas. This is reality, it's common sense, our rates must be competitive internationally now, we don't hold all the cards anymore.

For years, it's amazed me that so many people complain about the pay in their field, private or public. Do something else, end of story. If you don't like it, don't ask those who were willing to do what it takes to give you a raise.
If it doesn't work the first time, do it again.

My father worked for UP railroad, received his MBA in 1970. Hired right out of shool, lol, he climbed the corporate ladder for 21 years. He saved his pennies, eventually he was offered a buyout. Between savings and his buyout he had about 250k in 1991 and six kids. He immediately moved back to his home state with our family and attempted to start a jewelry business, failed. Then a voicemail business, when it was new, failed. Next, a chemical cleaning business for commercial buildings, failed. There goes 150k of his savings and three years. We were eating ramen noodles at home. Anybody ever say the fourth time's the charm? He had little money left, he invested 10k into a utility cost consulting business, his fourth client a few months in, paid him 750k, quarterly, over five years. He made great money doing it for 15 or so years, sold it for just under a million a few years ago, cash.

He never gave me more than clothes and food, no car, wouldn't help with college, nothing. I had work done on my four front teeth from a skate boarding accident in elementary, when I was 18 they started falling apart, it looked horrible. It was 1500 to fix them, he had the money, he told me it was up to me, he wouldn't help. At the time, I was upset with him. I couldn't afford college on my own and he wouldn't pay. He made too much for me to qualify for loans. He could easily afford all these things but wouldn't give it to me? What the heck? It seemed like everyone I knew was getting help in some way shape or form.

In hindsight, I'm thankful he did what he did. I worked full time and paid cash for my first year in college, always looking for a business to start, I found one after a couple years of due diligence. It worked, three years later, a 2nd worked as well, last year two more. He set such a great example, it offends me that people don't respect people like him. It seems like many people would love to raise his taxes by huge margins. Consider this, would he have had 250k if he had been taxed alot higher? What if it was enough he never made it to business four? He ran out of capital? Since the utility cost business, he's succeded in 3 others.

I can think of a half dozen ways off the top of my head that a hard working, sharp individual could make six figures, right now or in a short period of time. If you can't, ask those who do, study those who do, it's all out there and comes quickly when you definitively decide that you're willing to do what it takes. You just can't do what you want to do, you have to do what pays. You'll have the time and money to pursue your other interests, in many cases.


Toast_in_the_Machine


Feb 15, 2012, 4:47 AM
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flesh wrote:
I've had a hypothetical 50% plus effective rate conversation with a number of my close friends, most business owners, guess what we all agree on?

If it happened, we would relocate to a country with low rates. We would continue to do business in the us from another country. We make great money, but not crazy, mitt money. Many biz owners who have a model that would allow them to move, would. If you could move somewhere and put an extra million a year in your pocket, would you? Many will, obviously. There goes billions more leaving our country. Like manufacturing to China, what if it was banking, internet, or any business that can be done by phone overseas. This is reality, it's common sense, our rates must be competitive internationally now, we don't hold all the cards anymore.

Consider this an invitation to fuck off and take your friends with you. Like now. Go for it. If you think that you can get a better life elsewhere than the US then go for it. Quit bitching like a hippy liberal complaining about the US war machine and just leave already.

If the economic benefit of the taxes paid (infrastructure, safety via a war machine like no other, police protection, education, etc.) isn't greater than the cost, then you are free to leave. Make that good economic decision and go. Just don't try make it look like you are doing your patriotic duty to complain that you might leave. Your Blazing Saddles Bart "everybody hold still or the nigger gets it" routine has been played out. The US is already tilted way to having lower taxes on people who make lots of money. If you don't see that and only see WIFM then you are welcome to vote yourself off the island and find your own tribe elsewhere in such tax havens as Somalia.

The world may be flat and capital has more movement now than ever before, and yes, there are strains on the nation state due to new economic realities. However, if the same person who bitches about potential economic disaster that is a large deficit (due to war and tax breaks on "business owners") isn't willing to kick in a few scheckels to pay for the protection that that war provided then you are welcome to leave. You can take your narrow, only self centered self and go pollute another society. I'm not telling you to leave, I'm saying that you should indeed make what you see as the right economic decision.

Personally, if all of the self centered numnuts who think because they run a business or own capital that they provide a benefit to society above and beyond anyone else left the US, I believe it would be a better country.


scrapedape


Feb 15, 2012, 4:48 AM
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Re: [flesh] So happy Mitt will be president [In reply to]
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First of all, let me say that I'm in no way defending the idea of a 90% marginal rate. But there are a couple of places that I think you go wrong here.

flesh wrote:
Economically, this would be horrible. The cash markets would be overrun and the people who truly needed to earn money on their cash, savings, cd's etc. would get no return. A larger issue is that the business owners would have access to substantially less cash to invest into growing/expanding/starting companies.

In the situation you've described, it seems like debt financing would be readily and cheaply available. You basically said so yourself when you noted that savings and CDs would be delivering very little return.

In reply to:
I've had a hypothetical 50% plus effective rate conversation with a number of my close friends, most business owners, guess what we all agree on?

If it happened, we would relocate to a country with low rates. We would continue to do business in the us from another country.

As a US citizen, I believe you are required to file and pay taxes on income earned anywhere in the world. Also, the US taxes corporate income of foreign corporations in the US. So I'm not sure how this would really help you without getting into some shady business.


Allfred


Feb 15, 2012, 5:28 AM
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flesh wrote:
Allfred wrote:
j_ung wrote:
styndall wrote:
[image]http://yglesias.thinkprogress.org/wp-content/uploads/2009/03/top_rates.jpg[/image]

I don't understand this graph. This appears to say that during several years there were people paying more then 90% of their income in taxes.

Check out this link. put 5,000,000 in the salary box and watch the effective tax rate (listed below the year) change as you scroll left and right through the years.
http://www.usatoday.com/...x-rates-spending.htm

I'm sure that most business owners never paid 90% effective. If tax rates were even close to that high, every business would be focused on finding each and every loophole. Also, for personal income, this would cause business owners to contribute an inordinate amount of money to the tax defered retirement accounts..

I didn't read any farther than this. The link gives you the background on how that chart was created. It's based on personal income, I don't know why you are thinking about business owners per say.

Anyway you could also look at the historical tax rates from another source like this: http://www.taxfoundation.org/taxdata/show/151.html but then all you get is tabular info.

Now look at the debt as a percent of gdp over time. and notice when the slope changes from decreasing to increasing.


Again look at those tax rates above. What happened with tax rates at about the time that our debt changed from decreasing to increasing.


Allfred


Feb 15, 2012, 5:28 AM
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Re: [Toast_in_the_Machine] So happy Mitt will be president [In reply to]
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Toast_in_the_Machine wrote:
flesh wrote:
I've had a hypothetical 50% plus effective rate conversation with a number of my close friends, most business owners, guess what we all agree on?

If it happened, we would relocate to a country with low rates. We would continue to do business in the us from another country. We make great money, but not crazy, mitt money. Many biz owners who have a model that would allow them to move, would. If you could move somewhere and put an extra million a year in your pocket, would you? Many will, obviously. There goes billions more leaving our country. Like manufacturing to China, what if it was banking, internet, or any business that can be done by phone overseas. This is reality, it's common sense, our rates must be competitive internationally now, we don't hold all the cards anymore.

Consider this an invitation to fuck off and take your friends with you. Like now. Go for it. If you think that you can get a better life elsewhere than the US then go for it. Quit bitching like a hippy liberal complaining about the US war machine and just leave already.

This is a much better answer.


styndall


Feb 15, 2012, 9:01 AM
Post #123 of 206 (1661 views)
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Re: [flesh] So happy Mitt will be president [In reply to]
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flesh wrote:
Allfred wrote:
j_ung wrote:
styndall wrote:
[image]http://yglesias.thinkprogress.org/wp-content/uploads/2009/03/top_rates.jpg[/image]

I don't understand this graph. This appears to say that during several years there were people paying more then 90% of their income in taxes.

Check out this link. put 5,000,000 in the salary box and watch the effective tax rate (listed below the year) change as you scroll left and right through the years.
http://www.usatoday.com/...x-rates-spending.htm

I'm sure that most business owners never paid 90% effective. If tax rates were even close to that high, every business would be focused on finding each and every loophole. Also, for personal income, this would cause business owners to contribute an inordinate amount of money to the tax defered retirement accounts. It's possible to contribute hundreds of thousands a year, legally, tax defered as a business owner. There would be alot more tax fraud as well.

It's like you literally can't read. 90% was the top marginal rate for income taxes - no one would have ever paid that percentage in effective tax.

EDIT: Or maybe you don't know how marginal rates work? I'm sort of mixed here.


(This post was edited by styndall on Feb 15, 2012, 9:01 AM)


Partner cracklover


Feb 15, 2012, 10:08 AM
Post #124 of 206 (1644 views)
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Re: [flesh] So happy Mitt will be president [In reply to]
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Allfred wrote:
j_ung wrote:
styndall wrote:

I don't understand this graph. This appears to say that during several years there were people paying more then 90% of their income in taxes.

Check out this link. put 5,000,000 in the salary box and watch the effective tax rate (listed below the year) change as you scroll left and right through the years.
http://www.usatoday.com/...x-rates-spending.htm

One interesting thing about the link is that it shows quite clearly how tax rates have gotten more and more regressive. That is, if you put in a low salary, the effective tax rate goes up over the last 3/4 of a century. But as you try out higher and higher salaries, you note that the effective tax rate drops. And the higher the salary, the more it drops.

So, over the last 3/4 of a century, more and more of the tax burden has been shifted onto the middle and lower-middle class, as opposed to the highest wage earners.

GO


guangzhou


Feb 15, 2012, 6:21 PM
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Re: [scrapedape] So happy Mitt will be president [In reply to]
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scrapedape wrote:
First of all, let me say that I'm in no way defending the idea of a 90% marginal rate. But there are a couple of places that I think you go wrong here.

flesh wrote:
Economically, this would be horrible. The cash markets would be overrun and the people who truly needed to earn money on their cash, savings, cd's etc. would get no return. A larger issue is that the business owners would have access to substantially less cash to invest into growing/expanding/starting companies.

In the situation you've described, it seems like debt financing would be readily and cheaply available. You basically said so yourself when you noted that savings and CDs would be delivering very little return.

In reply to:
I've had a hypothetical 50% plus effective rate conversation with a number of my close friends, most business owners, guess what we all agree on?

If it happened, we would relocate to a country with low rates. We would continue to do business in the us from another country.

As a US citizen, I believe you are required to file and pay taxes on income earned anywhere in the world. Also, the US taxes corporate income of foreign corporations in the US. So I'm not sure how this would really help you without getting into some shady business.

As an employee of the American International schools, I earned a salary overseas. The Federal Government gave me a 90,000 USD tax deduction. After the initial 90,000 USD, I was taxed at the amount over. (All American get this deduction if they work and live overseas.)

Another-words, if I earned 97,000 USD as a teacher, the Federal government only expected me to pay taxes on the 7,000 USD over the initial 90,000.

I never made over 90,000 USD as a teacher.

Now, as a business owner, I still get the deduction on the salary I pay myself. The Business I own isn't an American business, so it doesn't pay American taxes.

My Salary is much less then 90,000 USD and will always be, for tax reasons. My state has a waiver system for those of us who live overseas, so I don't pay state taxes.

Actually, even my photography income which is represented through an American stock Agency, Alamy, is not taxable in my case because of where I reside. (Uless my combined income is over 90,000.

If business owners moved their companies overseas, they could easily create foreign companies. A few countries welcome these companies because they provide jobs to it's citizen's.

I have no doubt America is one of the greatest countries in the world, I would jump on a plane and fly home to protect it from Enemies foreign or Domestic today if needed. I also know that the world is full of great places and opportunities. The love it or leave it attitude of the late 1970s is hard for me to understand.

My foreign company spent nearly $150,000 with American companies last year. (Small in the big picture). A $150,000 that helped the American economy just a little. 150,000 all taxable at both state and federal levels)

We spent another $100,000 in Spain and nearly that in Italy, helping both of those economies just a little. Add 250,000 in Indonesia, 15 full-time employees earning above average wages and full benefits, a five part-time employees earning well above minimum wage and you could say my business is helping the local economy here. Before we even talk about import taxes, local services, and various other business taxes.

Yes, even a small scale operation like mine work on the international level in today's economy. Climbing gym, gear importer, wholesale operation) Every-time you buy a carabiner or other piece of climbing gear, chances are you helping another countries economy a little bit, even with American Climbing companies. Many of those companies moved various part of their operations to save money, save on taxes. (Federal and State)

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