But what I don't understand is why these rallies are being held to protest, among other things, "higher taxes." (Higher spending is another matter.) There is a widespread perception that Obama is raising taxes willy nilly, so maybe this is worth clearing up.
As far as I know, there are five individual tax provisions in the president's budget that could be described as a tax increase. So yes, there will be some higher taxes. What's confusing to me is that the vast majority of these taxes affect only those households with an annual income of greater than $250,000. And the vast majority of these increases would have happened anyway if the Bush tax cuts were allowed to expire on schedule.
But let's go through them one by one. The five tax increases that I see are:
1. Eliminating the Advance Earned Income Tax Credit. This isn't a proposal to eliminate the EITC -- it's just a proposal to eliminate a particular way of claiming the EITC that is extremely complicated, that almost no one uses, and that leads to a high level of tax error. As far as I know, eliminating this is not controversial.
2. Letting the top two income tax rates revert from 33 to 35% and from 36 to 39.6%, respectively. This is obviously a tax increase. But it is also (1) Something that would happen anyway were the Bush tax cuts to expire on schedule; (2) Something that isn't happening till 2011; (3) Something that Obama repeatedly said he would do; and (4) Something that will affect only those households with annual income over $250,000.
3. Eliminating the phaseout of personal exemptions and itemized deductions for high-income taxpayers. (This is complicated because it involves ... a phaseout of a phaseout of a complicated law. Explanation here.) But the end result will affect the exemptions and deductions of only those households that earn more than $250,000 a year.
4. Limiting the top charitable deduction rate to 28%. I've written about this many times elsewhere and I think it's a tempest in a teapot.
5. Increasing the top capital gains and dividends tax rate to 20%. Again, this (1) will start in 2011; (2) would have happened were the Bush tax cuts allowed to expire on schedule; and (3) affects only those families with annual income above $250,000. And for a sense of how this top rate compares historically, consult this chart (particularly the Reagan years):
So are the majority of the protesters worried about taxes that won't affect them? Perhaps when the tax-day protesters worry about higher taxes, they mean to protest anticipated future taxes that will result from higher present debt. (I'm certainly concerned about that!) But I'm not sure a protest in favor of the abstract notion of Ricardian equivalence has the same drama as a protest against higher taxes. Or am I missing something?
One cannot talk about taxes without talking about spending and the opposite is true as well. One must also consider the effects of inflation.
Personally, I will be joining this protest today, because I believe that these principles of protectionism and socialism will ultimately hurt our economy and freedom in general. There is also something to be said for concern about an issue even if it doesn't directly concern you. The primary risk in a democracy is that the majority will oppress the minority. My personal taxes may not be strongly affected, but I should not be so selfish as to be unconcerned as long as it doesn't affect me. I should also not be so naive as to believe that it would not begin to affect me directly or indirectly in time.
This is a protest about more than just the Obama administration. US taxes have been out of control since before the first world war. This protest is against taxes and spending, and only indirectly about administrations which support them.
Please expound on this part because I think it's at the crutch of this discussion: "I should not be so selfish as to be unconcerned as long as it doesn't affect me. I should also not be so naive as to believe that it would not begin to affect me directly or indirectly in time."
What folks on this side are trying to figure out is why Tea Partyers care so much about the wealthy's tax rates; and why do they continue to think tax breaks for wealthy will eventually come back to help them. Our feeling is that the wealthy have had recent tax breaks w/ no subsequent benefits to the economy, quite the opposite (the image is the wealthy person buying foreign and/or luxury goods with their extra cash vs. reinvesting in the economy). There is an underlying feeling here that the wealthy are no longer interested in being entrepreneurial or stewards of our economy. So, I would like to hear more about why regular folks care about the wealthy paying a bit more at this juncture. Remember, we're talking about personal income taxes, not business taxes. Thanks.
I would be happy to expound on these points, thank you.
1. Selfishness - Selfishness in America is often linked with bigotry. This is a form of selfishness which says that one group must make sacrifices more my group. Many times this is in response to a perceived injustice. We see this in both race and sex discriminations, where the oppressed becomes the oppressor, or attempts to. The same is true with wealth. Wealth envy is a bigotry with little to no opposition in today's popular culture, but it is just as unfair. The biggest risk with a democracy is that the majority will oppress the minority. We currently do that with the wealthy and are attempting to do it more. Bill Gates has no responsibility to pay for my lifestyle. I would love it if he did. I could always use some more money, but if I pass a law saying he must give me what he has earned, then I am a thief. I have often wondered whether a bill that said "The riches 10% must give all its money to the poorest 90%" would pass. Sadly, if put to a popular vote, I think it would. That is why I oppose taxation of any group of people disproportionately. Bill Gates has more money than me. He can afford to pay more than me, but what right do I have to make him pay so that I don't have to?
2. Cause and Effect - We cannot honestly think that putting extra taxes on any group will not affect other groups. Extra taxes on the poor means that employers must pay their employees extra, so that they can live. Extra taxes on the rich means that businesses need to increase prices in order to stay afloat. I work primarily with computers. If we tax Bill Gates, then Microsoft needs to charge more for their software, which means that everything I do for my job cost more. That means that everyone who uses my services pays more. We could pass a law that Microsoft can't raise their prices, take more of their freedom and their money, but what happens if they fail? If we take their money and deny them extra income to compensate, so that Microsoft fails, what happens to our business world? Our current mindset is that we wouldn't let them, so we give them bailouts and more government control. Taxing any of us affects all of us. Taxing Bill Gates may not affect me as much as just taxing me, but it does affect me. Remember that the arguement is for fewer taxes in general. Tea Party goes were generally unhappy with Bush before being unhappy with Obama. I want tax rates lower for every bracket than either of them offered.
A side note about the economy is that money is indestructible. If rich people squander their money, it doesn't go away. It just changes hands. If Britney Spears buys a million dollar necklace for her dog, then she gives a million dollars to a jeweler, who in turn spend it himself. The money stays in the economy, creating jobs all the way. One could easily argue as well, that celebrities who waste their money in such a way sent it to a person who will treat it more judiciously.
Incidentally, I also have no problem with buying foreign goods. Foreign goods are often cheaper than domestic goods because they are made by poorer people. If an American loses a job, he can find another or go on welfare. If someone from the 3rd world loses his job, he and his extended family can easily starve. In the long run, both jobs should be preserved. Our economy is more global than ever, and the chain of cause and effect is far reaching. When I buy cheaper goods from India, I have more money to spend elsewhere, and that person from India now has money to spend, and the person he gives it to has money to spend. It may eventually even come back to America. If we believe that our industries and services are the best in the world, then it should.
Most of all though, I think the issue of taxation and spending is not one of economics, but freedom. If the government could prove to me that by taking 100% of my money, I could live in a better house that they chose for me and drive a nicer car that they bought for me, then I still wouldn't do it. My freedom does not have a price. If having 100% taxes makes me a slave, what does having 40% (taking federal, medicare, social security, state, county, local, etc into account) make me?
Fox news watchers.
How do you think they plan to repay the trillions upon trillions of debt we are piling up? By taxing us - we aren't stupid.
An entity without a finite lifespan (a country or corporation) does not pay back debt. The USA is not like you, it does not have to plan for retirement or payback its loans. These entities will always operate with leverage or debt. So the idea that taxes will be raised to pay back debt is the wrong way to look at it. What you need to be concerned with is the debt burden increasing the interest rate that the market will require to loan to the US. The offset to this of course is the rate of real GDP growth. So long as GDP growth outpaces the growth in interest payments we are ok. IF the spending ends up being truly stimulative it MAY pay for itself... admittedly that is a big IF at this point.
The GDP is contracting, and the national debt will be 13 trillion dollars by September 30. And it is a fallacy that a government must be in debt, that is the lie that the banking cartels have fabricated to enslave the U.S. with its money-as-debt. Taxes will be raised to pay back this national debt, since countries soon will be looking to dump U.S. securities rather than buy more.
Ralph -
Yes GDP is contracting and if it continues 'We The People' will loose trillions of dollars anyway. I am not saying that government spending is the solution, I am only saying we should look at this objectively and find a solution that does the least harm and you should consider deficit spending as one tool.
A government with excellent credit, like the US, would be complete idiots not to carry at least some very cheap debt.
As for the rest of your response, about banking cartels enslaving the US ... Well you just can't rationally debate the irrational.
Pay attention. When the president is moving his lips, he's talking.
How were we ever going to pay for the war in Iraq? That was just spending, not investing like so much of the new budget is.
What are we protesting? Here's my questions:
Do you have children?
Can you do basic math?
If we can barely afford the half trillion we pay in interest on the national debt now, what do you think will happen when the debt is doubled in ten years?
Start doing some addition. National debt now is 11 trillion. Add in the 3/4 trillion TARP and the 3/4 trillion stimulus. Now add in the half trillion omnibs and a budget with a 1.75 trillion dollar deficit. Now add in the 1/2 to 1 trillion dollar deficits predicted by the CBO for the next ten years. Then consider that the Federal Reserve has comitted trillions to buying up toxic debt. Some economists have estimated 8 to 12 trillion.
Where do you idiot pundits ridiculing protestors think all that money will come from? Do you think God will open up the heavens and dump gold down on our heads?
We can't get loans for all that money. They're going to print it out of thin air. Does the word Zimbabwe mean anything to you? How about two words: Weimar Republic?
I think all you so-called journalists, this POTUS and congress (and several before them) truly think we the people are dumb as a post. We aren't, hence the protests.
First a countries debt should always be measured as a percent of GDP not in absolute dollars.
Zimbabwe & Weimar Republic are not good examples for our debt situation.
You ask about basic math... I ask you this, if you have an investment opportunity that will return 10% and you can borrow at 5%, how much money would you borrow? $1 Trillion? $2 Trillion? You see, it is not the magnitude of the borrowing (untill it effects your borrowing rate), it is the effectiveness of the spending that should be your issue.
At the risk of parroting "soup" to a certain extent here, what the Tea Party protesters fail to consider -- or even allow for the possibility of -- is that the money added to the deficit could actually be an investment that pays substantial returns.
The very premise of GOP tax philosophy is that any dollar spent is a dollar entering a black hole from which it never, ever returns. GW Bush is, of course, the most recent example of that, lowering tax rates for the highest earners twice in his first term while actually increasing spending -- to the tune of about $500,000,000,000 borrowed every year of his presidency on average. And what did we get? Well, look around today.
However, applying GOP debt to debt in general is a false argument.
Investing tax dollars now into what could return GDP to levels closer to our days of prosperity. Why would you prevent that?
Don't try and turn your perceptions into everyone's reality. Investment works, has worked in the past, and can work now.
I don't think that anyone is arguing against investment, just in who does the investing. The government may invest my money, maybe for a while, or they may just squander it, then tax me more to pay back the debt they accumulated, then squander the extra tax too.
Even if the government could invest my money just as effectively as I could, I'd rather they just let me do it.
When higher spending rates are funded by borrowing from the Federal Reserve, that is taxation. In fact, its a hidden tax.
When the Fed prints more Federal Reserve notes to fund the stimulus package or any other package, this necessarily devalues the dollar.
The people who print the money (the Feds) and the borrowers (Federal Government) get the full benefit of the those dollars. However, as those dollars flow through the economy everyone elses' dollars are worth less.
Since we have no choice in if this happens or not, it is compulsory. As we all know taxes are compulsory. The government is devaluing the dollar to increase their spending, and since we have no choice in the matter, it is a tax. It is literally money taken out of our pockets by reducing our purchasing power and increasing price inflation.
I think over all people are protesting both taxation and spending. look if anyone thinks people who make under 250k won't see any tax increases, you all are dead wrong. what about the tax increase on tobacco for instance, what about the proposed taxes on "big oil" where do those tax increase hit? the consumer- therefore they are in fact raising taxes on everyone. call it what you will, but when you tax businesses as Obama will, business will pass that along to consumers in the form of price increases, which in effect is taxing the population. moving on to spending by the government, how do you think they will pay for this 780 billion they spent and the proposed 2 trillion dollar deficit? what is the ONLY way government raises revenue and capital? that's right YOUR money in the form of taxes. not to mention once we increase the size of government, that new cost will become the base line for future budgets, therefore requiring more tax increases in the future to pay for these programs. So people who are educated and understand what is going on with this administration are protesting they don;t like the "change" we were promised by this administration., after all just because you change something, doesn't necessarily make it better. There are many people who do not wish the government to mandate their education, health care, retirement, how banks do business or have the ability to fire auto Executives or any other executive for that matter. this is a power play for more government control of our lives plain and simple and I for one do not wish to be a soldier in that army.
Uh, what are they protesting? How about the fact that this untenable run-up in federal spending and debt will ultimately require that WE, the taxpayers, pay for it. Those of us with a shred of fiscal sanity left (that excludes most of Congress) aren't fooled by the distraction ploy of a small near-term tax cut.
So the message in these protests is simple: STOP SPENDING!
There are too many misconceptions out there about these protests.
First, just because protesters disagree with Obama's spending plans does not mean we agreed with Bush's plans. Most protesters will agree that both presidents are/were on the wrong track when it comes to fiscal responsibility.
Second, you cannot only protest taxes without protesting spending. They're the same issue. Over spending today will cost us in the future, whether through hidden taxes like inflation, or through income taxes, or through sneaky moral taxes like sin taxes.
I disagree with both Obama and Bush (and most presidents prior). I don't see any difference between their plans for out of control spending. We need to show our local representatives that we disagree with what's going on in Washington, and hope they take notice and bring our message back to DC with them.
These "Tax Protesters" are simply the buttoned-down-collar version of the G-20 protesters. The main difference being golf lessons were incorporated into their potty training.
The protests do not appear to be limited to tax increases even though tax day was chosen as the day to speak out. Many are opposed to the rapid expansion in the size of government and the resulting increase in government spending that will likely be offset by future tax increases.
If you wanted to narrowly analyze tax increases, you could have looked to the increase on the tobacco tax, which not only broke an Obama campaign promise, but also will disproportionately affect the poor. Instead you chose to put up straw man arguments and knock them down one by one. That's like bragging about beating a five-year-old at connect four.
Also, you fail to entertain the notion that rescinding a tax break is tantamount to an increase because those affected will actually pay MORE in taxes. Nice sleight of hand!
Mr. Clarke, I believe you are missing something. Unless there is some secret savings account that we don't know about, all the spending that you elude to in your first paragraph, without elaborating will necessarily result in higher taxes. There is no way that the government can expand spending at the rate it is, without finding some way to fund it...enter higher taxes. Just because taxes are not rising for the majority of us at the moment, one cannot ignore the surety that they will soon.
In addition, those of us joining Tea Parties today are asserting our preference for smaller government and less socialistic policies from government in general, not specifically from the viewpoint of a particular political party. We are re-affirming our beliefs in the principles of the founders of our great country and asking our elected representatives to honor those principles. All are welcome. Mr. Clarke, I encourage you to attend a Tea Party and bring an open mind, you might just find out that you agree with a lot of what you will hear there.
Looks like Conor has drunk the Obama kool-aid. No one believes the garbage about taxes only going up on those making over $250,000. Taxes are going up on anyone who spends any money on anything. Those higer taxes will be buried in higher prices on gasoline, energy, food, clothes, cars, and anything else someone might buy. The politicians like to pretend that these aren't taxes but people like those attending the tea parties aren't that stupid.
In fact, the less money a person makes the harder the Obama tax increases are going to hit them. This is going to be the most devastating tax increase on the poor in history.
When spending goes up - everyone pays for it.
It's not the people who spend one hundreth of one percent on necessities who will be hit by Obama's devastating tax and spending increases - it is the person who spends everything he makes just to get by. They'll go bankrupt under this president.
Spending has been out of control since 1950. This isn't about Obama being the first of anything. It is in hope that he will be the last of the big spenders.
wonder how long Obama will be able to hide behind the " problem i inherited" and start taking responsibility for the problems he is creating.. can you say NEVER?
now he says he'll overhaul the tax code and still promising to "tax businesses that ship jobs over seas"
HEY OBAMA- we aren't dumb enough to fall for that- we know that the USa has one of the highest tax rates on business in the world. tax them and more will leave. then what? we all sit back and wait for good old Uncle Sam to take care of us? and we all become Gov't employees? RIGGGHHHTTTT. you aren't fooling anyone but the people you educate (govt educated public school)and the people you let come into this country illegally.
get out of our pockets.
its time for the Fair tax.. www.fairtax.org
Two items to note
1. Future taxes will have to be collected to pay off the debt that is being accumulated. If not, money will have to be "printed" (reserves increased) to pay for the Gov't deficit. If the latter, the resulting inflation is a "tax" in that it devalues your money at roughly the same rate as the money creation rate (This is not an ad hoc response, this has long been known and practiced, - look at Latin America 15 years ago or elsewhere). In short, "there ain't no such thing as a free lunch."
2. the tea party symbol is a proxy for arbitrary government confiscation of income (remember the original tea party was over the creation of a monopoly on tea, and only indirectly related to taxes.)
Thanks!
Craig
Mr. Clarke, It would seem that you are slightly clueless to the reason for the Tea Parties. It is more then being about taxes, but since that is the part you want to attack, I will be glad to give you a simple and straight up answer.
First and formost the Federal Income Tax is discriminatory in nature as the more you make the higher the rate. So much for everyone being equal.
Second believe it or not it is those that have the money to open up business that gives us jobs. Everytime the Federal or State Governments have introduced or increased taxes it has effected the employee either through lower or no raises or lay off as the employer has to cut back some where to keep profits acceptable. This is especially true where share holders are involved.
To put it logically every tax hieght no matter who it effects directly will eventually effect all indirectly. Historical and factual evidence supports both statements.
In ending please do some research before openning up such a subject. To those that use logic with factual evidence it really makes you look uninformed.
But Conor, Obama's doing nothing about the new higher tax rates on income and capital gains. Why not protest that? Why not insist that the President try to take less of what we earn - not more?
And, sure, let's start protesting the higher taxes we know must be coming, given all the spending promises the President has made.
And finally, there are certainly tax increases being imposed at the state and local levels. I know some folks who are ready to storm the streets and protest higher taxes are protesting the increases in city wage taxes, state income taxes, property taxes and the like.
Are there a host of reasons that folks might be protesting? Sure. But higher taxes (or the expectation of higher taxes) at all levels of government is only one of many issues.
Taxation and spending are not, as you suggest, 'another matter'. Actually increasing taxes along with increasing spending would at least be more honest.
What Obama and Congress are proposing is, in the words of Senator J.W. Wimpy, that: "America would gladly pay at some undisclosed later date for additional spending today."
To some extent, some people may be sympathetic with this. I am not personally a Keynesian, but if we embrace the notion that the economy can be injected with money in order to cure it of the illnesses that ail it, temporary deficit spending makes sense.
The problem is that some of the new spending is not temporary spending, and despite what the aforementioned Senator stated, we are not simply talking about spending today, but spending which will likely increase spending over the longterm and will need just need to be paid back, but will need to be paid and paid again.
Look people. Most rational Americans know what this so called "protest" is all about. It's all about frustrated, angry, bitter, and inflexible REPUBLICANS who are still smarting from losing the presidency to a Democrat.
When will the right-wing radicals wake up? The majority of the country is supporting Barrack Obama's approach in trying to fix the economy that Bush and the dastardly Republicans gave us. And now, these same Republicans are crying about how Obama is trying to fix the mess.
I laugh at these right wing dunderheads. The neither understand what it is to be an American, nor do they love their country. All they care about is the Republican agenda which excludes all those they hate, and embraces all those who only care for themselves.
Thank goodness that McCain loss. We would not only be in worse shape then we are in now, we'd also be facing WW III in the face.
Its the spending! Which inevitably leads to taxes!!! People are not stupid - they know the deal... unless they choose to be in denial because they are so enamored with our new leader.
Why are they upset about taxes that only affect households with >$250K?
1) Most two-professional-income households are in that space, especially if you assume some investments).
2) They are the people who actually pay income taxes in our system. Why would non-payers care? Take a look at who these people are. They understand the impact of taxing and spending on their own balance sheets.
Likely there are lots more reasons. But they are looking at a real decrease in income.
BTW, thanks, your article has some nice raw data.
1 - My household income IS > $250,000. I achieved this by working hard after moving to this country penniless as an immigrant.
2 - The increase in spending will result in higher taxes not only for me but my children and my grand-children.
3 - Not raising taxes willy-nilly? What was that proposal for 90% taxation on the AIG bonuses - APPROVED by this administration and not given enough time to be read before voted on?
4 - Cap & Trade - translates to taxes on consumer goods to ALL PEOPLE.
5 - Nationalization of industry - at what cost to us? If you want an example of public - government partnership - look at Fannie & Freddie. How well did that go?
FYI - the government's ONLY revenue is Taxation. If you honestly think that all this spending will not result in higher taxation for ALL Americans at some point, you should consider some refresher classes in simple arithmetics. I do hope that this clarifies the motives for the protests somewhat to you.
Why does everyone keep mentioning the $250,000 income floor as if that makes a difference? The American dream is to improve your economic situation -- and, possibly, eventually earn over $250,000 per year. To treat the "rich" (and who determines that threshold, by the way?) differently, is what many have an issue with. What incentive is there to strive to make more money if, as soon as you cross some arbitrary income level, you lose a greater percentage of your money to taxes?
And consider that this imaginary "richness" line varies depending on the cost of living where someone lives. $250,000 in Grand Rapids, IA, most likely buys a lot more than $250,000 in New York City. And I won't even discuss the effect of inflation on how we calculate "rich." Once we write a law, the thresholds don't change, no matter how much the value of money does.
We need to stop demonizing people who worked hard and achieved the American dream. Treat EVERYONE as Americans.
Dear author-- Please stop with the straw man arguments. They are protesting ridiculous spending and lack of cuts, not just taxation.
Take a look at what it takes to get IMF support in an indebted country. The IMF tells the government to run a budget surplus and cut back social spending. The US came up with the IMF rules and does not even follow them itself.
P.S. What is the qualification to get a job as a reporter at the Atlantic besides a socialist leaning? Don't worry - I am unlikely to offer any competition to you - due partly to the fact that I can count, Add, subtract, multiply etc.
I'm not sure if you're being intentionally dense or not, but here's the point: The Obama Administration has already effectively initiated higher taxes through his deficit spending.
Deficit spending has increased substantially; there are now more dollar bills out there, but the total value of all the money has not increased. Thus, the value of each dollar is less than it was before.
As mentioned by other commenters, this is a stealth tax, because no one has to actively hand over any money to the government. But the government has effectively taken wealth from citizens and transferred it to the government. This is taxation.
What's worse, this is a totally flat tax. The poor are taxed just as much as the wealthy. As the wealthy have more money, they can afford to lose more and thus the poor are harmed more.
Don't you care about poor people??
Here is a simple one for you to figure out. THE CONSTITUTION. IT HAS BEEN USURPED SO MANY TIMES WE CAN'T EVEN COUNT.
That is why I am attending this tea party. I want the United States to come first...not the UN.
I want common sense back in government. You can't spend more than you take in without going bankrupt....easy...huh!
I want our judges to stop making the law and start to enforce the laws on the books.
I want transparency in our government...not some bill signed in the middle of the night and no one was allowed to read it. If I have to pay for it...I want to know what the heck it is.
I want the USA back as the "best" country on the globe...I don't want people to apologize for it.
All these supposed tax cuts...do the math. We are on a spending spree. We spend...not cut.
I don't want our private companies unionized or nationalized. I want them to remain private...it encourages investment. Look at our stock market...it sucks.
I want what our Founding Fathers put in the Constitution and I want it adhered to.
Last...but not least...I don't want myself...much less our service people referred to as right wing radicals. We want our country back...If I wanted France...I would move there.
AND...STOP THE STUPID CAP AND TRADE. We can't afford it..it's a backdoor tax for the UN along with the Global Poverty Act.
PPS...GET RID OF THE THIEVES IN THE CONGRESS...EITHER PARTY...DOESN'T MATTER..GET THEM GONE.
So much tax, so little wealth...
Lets look at how much our government costs and how many of us are there willing and able to pay for it; then our tax rate is just arithmetic.
The only assumptions I'm making are: 1) we must trust our government (when they say we can afford them), and 2) as a generation we must at least pay our costs, and leave the next generation at least the level of opportunity we were given.
Let's assume that from today forward the future will take care of itself; that we need to cover only current liabilities, entitlements and other obligations over which Congress has made mandatory in the future.
Before we die, we need to pay about $56 trillion (plus the cost of any new programs); if you can believe data on US gov web sites, and have a big enough calculator then you can add up our country's current liabilities and unfunded commitments (Medicare, Medicaid, SS...). If you can believe Peter G. Peterson, and former US Secretary of Commerce, David Walker, Former US Comptroller General, then $56 trillion is about right and will grow by $2 trillion/year even with a balanced federal budget.
Now it simple to spread the tax across the "rich":
If "rich" means the top 1% of taxpayers in terms of AGI (1,357,192 single and joint returns) then they can handle the burden by paying $3,551,450/year each of the next 20 years. Well, maybe not since that's 269% of their entire income as a class; so let's keep hunting.
If "rich" means the top 5% of taxpayers (6,785,958; includes the 1% group above) then they can handle the burden by paying $710,000/year each of the next 20 yrs. Or maybe not since that's 162% of their entire income as a class; darn, let's keep hunting.
If "rich" means the top 50% of taxpayers (68 million) then they can handle the burden by paying an average of $71,000/year each for the next 20 years.
Hey they can do it-- as a class it's only 68% of their AGI! And that's even less than the 80% some want to stick 'em with.
By the way, the top 1% includes people with income of $389,000/year and above; top 5% includes those with income $154,000/year, and top 50% includes those taxpayers with individual or joint income of only $32,000/year.
So there it is: individual and joint filers making $32,000 or more a year are declared RICH. Problem solved if each pays only 68% of their AGI in income taxes each year for the next 20 years, plus whatever future program costs Congress enacts.
Gosh, what are we worried about? Let's party!
Forgotten Man
Just a simple question. If we are all equal, why do we have different tax brackets. Why should I have to pay a higher percentage than someone who earns less than me.
As an example if Joe makes $50k for the year and pays 20% , he pays $10k in tax
if Harry makes $100k for the year and pays 20% , he pays $20k in tax
if Bob makes $1mm for the year and pays 20%, he pays $200k in tax .
in this example, Harry pays 2x what Joe does , and Bob pays 20x what Joe does.
Isn't this a more "FAIR" way of doing it. The rich ARE ALREADY paying more in taxes, a lot more ! Does one have to fail math in order to become a liberal ?
And by the way , as someone stated above, if you don't think at least the next 5 generations are goiung to pay for this bailout thru taxes, you are absolutely kidding yourselves.
Read the stimulus, see where they are spending your money. They have spent $32 Billion since 1976 to find an alternative to fossil fuel, $32 BILLION !!!!! SO, WHERE IS THE ALTERNATIVE ???? WAKE UP AMERICA !!!
The author of this post is focussed on 'income' tax. Obama has already raised tobacco tax which, like tea, affects a lot of low income people.
As for income tax, discrimination against any class of people is still descrimination. There's an underlying prejudice against people that many labeled 'wealthy.' Who says $250k a year is wealthy? In today's world, taking location into consideration with a family....??!
Obama should know better as a minority that it is easy to get the majority to pick on the minority. But it still doesn't make it right, does it?
Regardless if Bush's tax cuts expired, they are still high anyway. Let's get a real fair tax in our system where the real wealthy cannot use loopholes to get out of taxes and the higher-middle-class which produces most of our jobs aren't hit the hardest.
p.s. I don't watch Fox or get my info from any infotainment on television.
If you are interested, we have the audio for the Tea Party robo calls that have been going out this past week all across the nation.
Here is the link: http://thinkdodone.typepad.com/ccd/2009/04/tea-party-robocall-audio-found.html
Shaun Dakin
CEO
StopPoliticalCalls.org
Obama dilemma – dammed if you do and dammed if you don’t. If the President does expend a stimulus are we at risk of a depression? If he does spend a stimulus then we are doomed to higher taxes. There will always be those who will complain no matter what he does.
I have been trying to respond to comments by email but since a couple of general points keep coming up I will also respond here.
One is the level of taxation being determined by the level of spending. I address this in the last paragraph of the post and don't think it's something I left out, much less something I tried to avoid. I agree that the rate of spending is more important than temporary changes in the tax law. The rate of spending worries me for this reason.
But my sense is that (1) a lot of people are under the impression that Obama is raising taxes across the board and IN THE PRESENT; and (2) a lot of coverage of the protests does not make a distinction between taxes in the present and taxes in the future. But I'm open to being wrong about both those points.
Other people bring up the tobacco tax. I've written about the tobacco tax previously and won't repeat it here. I limited this post to items in the budget. I don't think the tobacco tax was in the budget, although I could be mistaken about that. (I went back and checked and couldn't find it.) Let me know if that's the case.
You all realize the Boston Tea Party was a protest over a tax DECREASE, right? You all realize that for 99% of you your taxes will go DOWN under Obama's budget, right? Oh the irony.
And let's all snuggle down and listen to the fairy tale of how all these marvelous changes planned in the "budget" are going to me magically paid for by the Tax Fairy, who will wave its wand and suddenly there will be money to take care of every ill in our society!
Let's put it in another perspective--your personal expenses are going up, right? There are some home improvement projects you'd like to do, right? To do that, wouldn't it be nice if you got a raise at work? Or would you be able to do all that if your boss cut your pay by about 33%?
'plain it to me, Lucy.
Wrong, smug misguided Liberal. The Boston Tea Party was a protest against the Tea Act and other laws passed by Mother England. Colonists did not like the idea of British Parliament being able to tax them willy nilly - you know, "without representation." It was never about the amount of taxes (yes, it was quite low), but rather about the tyranny of a government run amok.
Obviously you never hope to make more than 250k, otherwise you would be pretty upset as well. To that I say "aim higher!!!. I guess it's easy to have someone else foot the bill. As far as charities are concerned they are all screwed--they won't get a dime from most of us. We should all leave this country and leave you to your third world socialist sewer.
Bottom line is, the Administration knows all these risks and consequences and believes they are worth it to create a massive overhaul in multiple areas of our government.
It's happening, and the right and left are both crossing their fingers, hoping the fallout to this huge inherited mess will not be another huge mess. Maybe Obama is the true Maverick.
In the bigger scheme of things, isn't it about time the pendulum swung the other way anyway? Yin and yang, checks and balances and all that jazz?
And let's not forget what's really important in life......
1. Taxes used for PORK!? (doen't matter if tax is 'less or more')
2. California sales tax increasing (for everyone)
3. "Steal from rich" is NOT what I want. (we can protest to show support for >250K people)
Even the "$" from my post has been stolen.
That's supposed to say ">$250K/yr" (not ">250K people")
:)
Two can play at this game. If you don't want to pay a cigarette tax then DON'T BUY CIGARETTES. Maybe I don't want my taxes or health insurance premiums to pay for your lung cancer treatments.
Nice tax-free health insurance you've got their spoony. You realize that the Health Insurance premiums paid by your employer are actually a form of income. That'd be a nice thing to tax.
Hey, you're using a computer, that uses nasty ol' electricity produced by nasty ol' carbon-dioxide-belching powerplants, we should tax that, to "protect the environment".
You're right though, the government should really take a firmer hand in social engineering through taxation. I wonder what other fun, but possibly dangerous things we can make money...err...stop people from doing. Maybe we should make driving over the speed limit a federal crime and put a surcharge on all speeding tickets.
(Don't know why I'm wasting my time with another of these silly liberal outlets … )
Let's clarify some points:
1. The Big O may not have raised taxes already but look out, he's going to have to in order to fund all the wonderful projects he has in mind. Then, you'd better hold on to your wallet.
2. Don't you think somebody ought to be protesting against the mindless, out-of-control spending that is going on? What happened to the promises of "no more earmarks?"
3. Barney and Chris certainly need to give an ear to the people. We may not can hand them the buckets of cash they're accustomed to, but we sure as hell represent the common man!
But, if the protest doesn't change things in Washington, will someone please pass me a pen? I'd like to sign up for the next round of "bail outs," please
"What's confusing to me is that the vast majority of these taxes affect only those households with an annual income of greater than $250,000"
1. I dont understand why that would make it ok. Is it ok because you dont make that much? Does that make it right?
2. let's say you have a twin brother that has the same job as you EXCEPT he works other jobs as well so he can save more for retirement and save more for his kids college. Why should he have to pay a higher percentage to taxes? Makes no sense. Obama stated he wants to reward people for working hard. Where is the reward in that?
It kind of looks like you missed the AJC article you cite first which makes it clear that the primary protest is against the high levels of government spending - including Bush's TARP bill.
Where taxation comes in for Mr. Armey and I'm sure for some tea-partiers was also clearly laid out when he said:
the real rate of taxation is the level of government spending, because there are only three ways for the government to spend money it does not have: print, borrow or tax. Today we are spending, and tomorrow it will have to be paid back with higher taxes and inflation.
Beyond that, the little I've read about the tea parties makes it sound like the "lower taxes" drive is as much about local and state taxes as it is about Federal taxes, perhaps more so. It seems to me that I recently heard that 11 states are planning to raise one tax or another in the near future.
I found the opposing AJC opinion piece by Karl Frisch fascinating. According to Wikipedia:
Astroturfing is a form of propaganda whose techniques usually consist of a few people attempting to give the impression that mass numbers of enthusiasts advocate some specific cause.
This is easy to do if you, say, have the same few people call radio stations over and over pretending to be different listeners; or if you have the same few people post comments on many different blogs pretending to be different writers; or the same few people photocopy the same letter thousands of times and flood Congressional offices with them.
It's a lot harder to do when "advocating some specific cause" means actually producing warm bodies. When the cameras are rolling it's awfully difficult for "a few people" to somehow appear to be "mass numbers of enthusiasts". So it seems to me that the grass-roots-ness of the tea parties is going to rest on how many people show up - not on who encouraged them to do so.
I eagerly await the usual fight over how many people were actually at the protests. I predict MSNBC will report a couple dozen and Fox will report thousands.
Eliminating the Advance Earned Income Tax Credit
TEA TAX Protestors are very justified in proclaiming that the tax code is too complicated and results in an amazing amount of taxes collected by all taxing authorities. This elimination of the AEIT is simply a case of an arcane tax code that runs into the tens of thousands of pages. It is a stretch to oversimplify the TEA protestors by offering the intellectual facts of a few programs that are being modified today. The total emphasis of the TEA protest is the extreme amount of spending and the night that follows day of tax increases to support it.
Letting the top two income tax rates revert from 33 to 35% and from 36 to 39.6%,
This is obviously a tax increase. But it is also;
(1) Something that would happen anyway were the Bush tax cuts to expire on schedule;
Why do you assume that the will of the people is to allow the tax cuts to expire? The economy would be better served to keep the tax cuts and lower the proposed spending.
(2) Something that isn't happening till 2011;
So, I guess your argument is that if we have long enough to think about these increases it will not matter or become palatable to the majority that do not pay income taxes to begin with.
(3) Something that Obama repeatedly said he would do;
President Obama’s repeated desire to tax and spend his way to an unstated version of social reform in a misguided effort to redistribute the wealth in America is not something that I would label as a valid argument for increasing taxes.
(4) Something that will affect only those households with annual income over $250,000.
This argument is a favorite of the spend now and pay for it later crowd. There are a lot of entrepreneurs that have sporadic income or large income for one year and very little for the next couple of years. The income producing citizens of this country should not be penalized for being successful and employing worker bees. Setting a cap for success is not a good idea. Perhaps a flat tax with a VAT on all purchases would suffice it the transfer of wealth (entitlement programs) are reduced to a level that are sustainable by a lower tax burden.
Eliminating the phaseout of personal exemptions and itemized deductions for high-income taxpayers.
Same Argument as above – simplify and flat tax. Make it possible for everyone to understand. Eliminate the greater portion of the IRS.
Limiting the top charitable deduction rate to 28%.
In a conversation with our local Congressman lately I had the opportunity to ask him what he thought about the 28% cap rate. His reply was that it will go hand in hand with the proposed 28% limitation on deductions that will include your mortgages. Again it is meant to punish the “bad” people who earn and produce the jobs. The people proposing all of these will never admit to the power grab by controlling the companies and the individuals that are producing this income that needs to be sheltered from the governmental agencies that are touted as being better at regulating where this money should be spent.
Increasing the top capital gains and dividends tax rate to 20%
As a self made entrepeneur, I have paid higher rates for capital gains in the early 90’s. The thought of working hard and paying taxes for 20 years only to have the government demand almost a third of my lifes work due to my temerity in selling my company was a heartbreaker.
Money earned and assets created belong to the individual or company that did the work. I have yet to see any one at my door step with a check when times were hard or lending a helping hand that last hour of a 20 hour work day. The successful person does not need to be punished for working extra hours or taking financial risks beyond those taxes required to support our military and provide basic infrastructure to joint ventures that the states deem necessary. The 10th amendment is alive and well in TEXAS.
Yes, Mr. Clarke. With all due respect, you are missing the point big time. I just returned from a lively Tea Party in Central NJ. Were we protesting the runaway spending that has put our yet-unborn children and grandchildren into five figures of debt the second they enter the world? Of course.
But the protests today are about more than that. It's about the federal government's assault on our personal income, on private business big and small, on our health care decisions, on our freedom of speech and that of personalities on the airwaves with differing views, on the Constitutional right to bear arms, on the Constitutional right for states to make laws their own citizens see fit and *not* an overreaching federal bureaucracy, on the push to grant voting rights to illegal aliens.
What we're protesting, Mr. Clarke, is the radical restructuring the Obama administration is conducting to make this country something completely distinct from what our Founders and Framers of the Constitution envisioned.
Does that make sense now?
http://VocalMinority.typepad.com
The Jewish Republican's Web Sanctuary
They also envisioned slavery. Maybe that's why the protesters are mad because a descendant of slaves is in the White House that was built by slaves. Yes, I pulled the race card and no I'm not "of color". But I can hear. People are more apt to talk in front of me because of the reason I stated.
The main reason no one likes Obama IS because of his color. Plain and simple. Bush spent WAY more than the Obama administration and there were not these types of protests. In fact, I don't recall ANY protests against Bush until after there was considerable time spent in Iraq during the war.
Just go on and say that you don't want a BLACK President spending because of the stereotypes that exist about black people, spending, and money. It's strange how of all the cities that hold this demonstration, I have not seen any people of color. And I'm not sure if there are many homosexuals who are protesting....
Makes one wonder.
I am not a liberal. In fact I think the "liberal", "conservative" argument is dead and just plain stupid. My parents are Republicans and have been since I was born and even they are tired of the "liberal"/"republican" arguments.
This whole thing is just ignorant...you old people need to wake up!
I'm not sure where your estimate of Obama's budget is coming from. He is set to spend more than any other president in history, more even based on GDP since WWII. I think the reality of rapidly increased spending is undeniable. For the record, I think Bush's was too high too.
The entire race issue is severely unfortunate. I only know one person who opposes Obama because he is black (half black). As for the lack of black protectors against Obama, that is a different matter. I did actually see a few at the Tea Party, though admittedly not many. Black approval of Obama was at 96% at one point. That is crazy high. That is way more than just a democratic leaning. That is more than any political stances have been able to sway. People are arguing about the man's supposed race while he takes our freedoms away at an unprecedented rate.
Whenever someone reduces something as complex and broad reaching as these tax increases to 5 short paragraphs, it shows their lack of understanding and the fact that they think the rest of us are idiots! Not only will these increases affect more than those whose AGI is >$250K, but these increases will also affect small businesses that file as S-corps, LLCs, etc. These companies will be forced to cut jobs or not be able to create new jobs, which is just the opposite of what "Slobama" is trying to stimulate right now. Small businesses are the backbone of the American economy, and that's who will be hit hardest by these tax increases.
And the Liberal News Organizations in the country really wonder why they are going under. Better Red than Dead, ObamaZombies.....
We are protesting this government just like you libs did when Bush was in Office. The difference is conservatives do not HATE Obama, just socialism. If that shoe fits you should not be too ashamed to wear it, if you believe in it.
I have no problem with rich people, just poor people who think they deserve a handout and rich people (Pelosi, Reid, Obama and others) who try and not act rich, by using just speeches and words.
Poor people don't think they deserve a hand out. But rich people always think that there should always be poor people because they couldn't be rich without poor people.... Totally crazy! What else is weird is that even if the "playing" field was level now and everyone payed the same taxes, there would still be a big gap of poor and rich. The rich take advantage of the poor, NOT the other way around. And even WHEN the tax rate goes back to the Clinton Era, the rich who are complaining about the taxes going back, will STILL have a higher income than the poor..!!!!!!!!!!!!
Wow, so I make $400,000 and have to pay higher taxes. And then some smuck makes..let's say $50,000, a good living some would say...um, there is no way EVEN with the tax increase, that the person making $400,000 will make anywhere near the $50,000.!!!!
You will still have more money and capitalism will still be alive!!!!!!!!!
Yea, let's honor the people that break the backs of the hard working poor!!!!
Yea, let's honor the constitution that allowed slavery!!!
No I don't agree with ALL of the President's agenda, nor did I agree with all of Bush's but what the Tea Party is doing is just strange when no one worried about this under Bush.
It seems las if many would be in favor of a flat tax with NO deductions which certainly would be simpler... but I am sure there would be many special interests who would try to cut a deal to deduct there favorite expense.
Cigarette tax? Easy to avoid. Perhaps we should encourage the poor to smoke so they will die at an earlier age and thus not be such a drain on the hardworking citizens.
Thank you for this article, because, regardless of previous complaints, this actually answered a lot of questions I had about the anticipated changes in the tax code.
I am so tired of seeing great articles followed by comments of anonymous dissent, as if your prepubescent screennames somehow encapsulate your essence. The only thing more cowardly is an apparent inability to care about anything other than personal gain based on some illusion of an American dream that might come true for you someday, maybe when you are all thin, rich and pretty.
I am an average American. I am what used to be middle class, and I have gladly paid taxes for 24 years, not just because I have a patriotic duty, or even because compared to other countries I really don't pay very much, but because I think education, health care and public safety are as important as any war we ever fought. Economically they are without a doubt a much better investment (ask the French).
I live in Richmond, California and our roads, bridges, education, public safety programs and health care are now in a condition that threatens our security. But I'm sure if I dream about buying a McMansion hard enough, and we work hard enough, it will come true. Meanwhile, in reality, my husband's company grew insolvent and we were able to sell it just before the credit crunch. Now my husband works for the company he created and thanks God everyday for being employed.
I shop at the local grocery store. I choose from drastically unregulated food that skips inspection en mass, and is hopefully imported from the country the sticker says, but how would I know? My kids like peanut butter. What do you think, should I risk it this week?
Apparently my dad is the only one who is insufficiently supported by the government programs for medical treatment and retirement he was promised (not to mention his supposed vet benefits). Someday you expect me to look him in the eye and tell him he is just going to have to die early, since I have to choose between him and my own kids (we've actually had this conversation by the way).
I must be the only one with a relative in prison; I have another one who served in prison and is having an impossible time re-entering society, but that's their problem, right?
There are a lot of veterans out there who were promised respect as a result of laying their lives on the line, but, since that's not REALLY a priority, I guess that can wait. I mean, the Vietnam vets are in their 60s now, the WWII vets in my family are long dead, so if we deny them health care they should all be dead soon and that will fix the problem.
I have family members with medical problems, I have school debt, we might be facing a home foreclosure, but that's not your problem, you're doing great.
I mean, you work hard, you came from a good family, you are a good person, you voted the right way. You have a right to be angry. All those stupid people with jobs and families who never did a thing wrong either, obviously there is something wrong with them because the American dream works. And if it isn't working for them, then it's their fault.
It doesn't matter anyway, right. I mean, in a world full of winners and losers, you have to win, no matter what. Not everybody can have a home, not everybody can be employed, not everybody can be free. There are only so many seats in a classroom and so many seats at the dinner table. So you're going to have to step on somebody's neck to get ahead somehow. May as well do it now and get it over with. Taking care of your own is the Christian thing to do.
It would be easy to argue for more spending in a way that actually makes sense, but you aren't listening anyway, are you? It's a lot easier just to hate all the stupid people from some anonymous location backed by corporate-constructed pre-packaged arguments spoonfed by a foreign media mogul instead.
Besides, that way you can pretend that you are doing great and that you don't have old people, vets and ex-cons in your family too.
Good luck with that.
Your state is in the crapper because it can't control spending on an ever growing bureaucracy while being locked out of raising property taxes by a ballot measure that changed your state's constitution.
California then had some brilliant idea to raise income and other taxes on the "rich", and now you're all confused as to why ultra-liberal actors and directors, whom support your state's out-of-control spending, are making their films in tax-free Vancouver.
You have a fantastic court system that supports all of your NIMBY craziness, so that no development can happen anywhere. And you're surprised to find that the few "McMansions" that are built in your state go for the same price as a couple of square blocks of property in Detroit.
Why are you locked into living in a state that is falling apart? Vote with your feet, take the money you got from the sale of your husband's company, take the skills that the both of you have learned, and move to a part of the country that's growing. Has California robbed you of your pride and self-determination?
Yea Jessbartwilliams, welfare is horrible...oh as long as I'm not the one on welfare!!! I remember working for the welfare department before I got my degree and an old caucasion woman coming in in a HUGE hat and large dark sunglasses. She was ashamed because she had been wealthy and was applying for Medical. She expressed her embarrassment and asked that her name not be called out loud.
I remember telling my mother about the incident (without mentioning the woman's name) and she told me..."Be careful how you treat people, because you never know when you are going to be on the other side of the counter"...
That stuck with me and is something I am trying to instill in my own children.
Now that we see the economy in this rut people are going nuts. The "wealthy" are protesting because they think that the average middle class and poor person doesn't work hard.
Seems like the same argument people made about slaves...which turned into a stereotype about blacks...lazy, not hard working...you can achieve if you work hard.
There are lots of people who work hard who will never become Paris Hilton....that doesn't make them less than anyone who makes more...
I hope that your personal situation gets better, and more people need to understand what you and other families are going through.
Top Five positives about Obama tax plan and tea parties:
5) dialogue like this is how we get all the talking points out and learn from one another
4) until there is a better way, we'll be paying taxes like we have been for well over the last 200 years--taxes are taxes and it will be a long time before there are no taxes
3) at least our taxes are not going to another country or a king like George; they're going back to the American people (or so they are suppose to)
2) more help than harm toward fighting crime--more poverty, more crime
1) welcome back middle class
That's the point that many do not see. Including many in my "conservative" family. Taxes are taxes!!!!! They are not going away. The thing that gets me is that many people in the higher income bracket, who will still be fine if taxes were raised are against the taxes being raised even if it means that the middle class and poor will benefit from this stimulus package.
They speak that they are for America, but in actuality they are for the "rich, white, straight,conservative" American!
They are not for ALL of America because if they were they would see that these tax increases are not new! They are what it will return to like it was in the early 90's. Incomes are way higher than what they were in the 90's! Wow, get it together people!
Oh, and just a word, please stop...Obama is the Anit-Christ signs. If you're gonna protest something, that is so NOT effective!
It is difficult if not impossible to convey the lessons learned in a lifetime of self reliance to the entitled unwashed. Why do I owe you something other than the same opportunity that I had. Educate yourself, work hard, take the hard knocks that life gives you and make something work out for yourself.
The Obama governmental budgets will require me to spend more time and money trying to stay ahead of my basic needs than in the past. Trillions of dollars wasted (as proposed) - No great projects completed - squandering the wealth of the nation. The road to hell is paved with good intentions.
Any business person knows that you cannot allow so many people with a hand in the pot grabbing money. This is going to written down in history as the Folly of Obama. Congress spends the money - Obama just sets out a proposed Budget. The Democrats in Congress and the Senate have as much or more blame as Obama.
The TEA parties are not going far enough. It is a treacherous thing that the Federal Government is propsong to do with this uncontrolled spending and the taxes that will follow. We as taxpayers have the duty to resist the selling of our country to the highest bidder. We will be indentured servants to the bonds that are being sold to create this spending spree. And to top it off - what great project is it accomplishing?
I quote Lamza :
"3) at least our taxes are not going to another country or a king like George; they're going back to the American people (or so they are suppose to)"
Look into this one. Aside from Iraq, your taxes are paying for healthcare, schools, jailing for millions of illegals all over this country, may as well be going to other countries !!
What an utter mess of a thread. I pity you if you're actually reading and responding to all this, Conor.
So, to summarize the previous near-incomprehensible posters, either:
1. They think they're going to make over 250k at some point in the future, and going back to the marginal tax rate of 39% on income over 250k that we've had for much of the last century is utterly unacceptable. Right.
2. They're flat-tax dead-enders who abhor any kind of progressive tax to begin with. Great.
3. (What they're mostly claiming) We're deficit spending to get out of a recession, and they're outraged because Ricardian equivalence means taxes might go up at some point in the future (though this isn't necessarily true). In other words, things that Obama or somebody else may or may not do in the future that nobody's proposed is an affront to the principles of this country, and now's as good a time as any to protest them. And the same people who don't give a rat's ass about global warming's potential impact on their children are absolutely incensed about the potential tax burden on their children.
Oh, and every single one of these people was outraged at Reagan's and Bush's tax cuts because they hate deficit spending that much. Yep. Every one of them. Nobody in this thread that cheered on the past eight years, nope.
4. (What it actually is) The frustrated tantrums of people who find themselves out of power and unable to influence the direction of the country after their way was tried and found lacking. As evidenced by the fact that not a single poster here came up with any coherent economic plan for deficit reduction. Perhaps the protests would be something besides a laughingstock if they were actually advocating *for* something.
Adam: Most of us are FOR fiscal responsibility; FOR a smaller (less expensive and less intrusive) government; FOR individual rights; FOR accountability from Congress; FOR our Constitutional rights; FOR rugged individualism; FOR the opportunity to advance oneself without fear of being demonized for being successful; We're not partisans, we will support those who hold these values, regardless of where their names appear on a ballot. What are you for?
To Adam: You've chosen to miss the point completely. The simple plan for deficit reduction: Stop the crazy and needless spending of money we don't even have. I don't think its asking too much. And please don't give the argument that Obama inherited a huge deficit from the Repubs. A wrong followed by an even more egregious wrong doesn't make a right. (And yes, I objected to the deficit spending of the last admin too)
ADAM,
So, to summarize the previous near-incomprehensible posters, either:
Agreed – some of this is total dribble – extruded from a pile
1. They think they're going to make over 250k at some point in the future, and going back to the marginal tax rate of 39% on income over 250k that we've had for much of the last century is utterly unacceptable. Right.
Your argument is that being overtaxed and having our money squandered in the past justifies continuing that disservice today?
2. They're flat-tax dead-enders who abhor any kind of progressive tax to begin with. Great.
Flat tax dead-ender - Such a great term – what nomenclature would you attach to the taxing system we have today – fair – balanced? Try calling the IRS for an answer to a difficult tax question. My view is that the method of taxation in use today is too difficult to follow and inherently unfair to the taxpayer. A flat rate Income Tax coupled with a consumption (VAT) tax along with property tax will hit all taxpayers with the larger consumer paying more taxes as they consume more. I am not advocating for this particular tax program, just cannot fathom the 65,000 pages of our existing tax code.
3. (What they're mostly claiming) We're deficit spending to get out of a recession, and they're outraged because Ricardian equivalence means taxes might go up at some point in the future (though this isn't necessarily true). In other words, things that Obama or somebody else may or may not do in the future that nobody's proposed is an affront to the principles of this country, and now's as good a time as any to protest them. And the same people who don't give a rat's ass about global warming's potential impact on their children are absolutely incensed about the potential tax burden on their children.
You seem intent on mixing several ideas together here. Try to present a cogent though process.
FDR did his best to spend us out of the Great Depression and failed miserably. Can you present any evidence of any government that bought/spent it’s way out of a major recession?
I can see that you assume Trillions of Dollars squandered on inumerable pork projects is not going to cause taxes to be raised to pay back foreign governments that purchased our securities. In the past, when we had deficit spending we owed that money to ourselves, in todays environment we are spending other monies that we are have to borrow.
Now to the rat’s ass portion of this meandering paragraph. Global Warming – I cannot argue – This is beyond my pay grade - we would have a huge impact if we allow the total destruction of a majority of the cows in India, coal burning plants in China and India, stopped all air flights and resorted to a negative birth rate globally. I can only hope and do my part to not add to the carbon footprint I leave on this earth.
Oh, and every single one of these people was outraged at Reagan's and Bush's tax cuts because they hate deficit spending that much. Yep. Every one of them. Nobody in this thread that cheered on the past eight years, nope.
I had assumed that the great economy we rode through for the last decade or so was evidence that we were on the right track. Seven or Eight years ago the issue of fraudulent home loans to people flipping homes or buying homes and installing renters as a way of fraudulently cashing out on home values was being discussed in meeting that I had with mortgage lenders. The federal mandates put forth by the Fannie mae and Freddie Mac crowd sponsored by the Barney Frank and Sen Dowd was limiting how much effort the lenders were willing to put into the screening effort. It was possible to end up in a discrimination lawsuit if you looked to hard at some of these applications. It is difficult for me to see why you are outraged at the Republican Presidents who were in charge of such strong economies.
4. (What it actually is) The frustrated tantrums of people who find themselves out of power and unable to influence the direction of the country after their way was tried and found lacking. As evidenced by the fact that not a single poster here came up with any coherent economic plan for deficit reduction. Perhaps the protests would be something besides a laughingstock if they were actuall y advocating *for* something.
I am advocating – No bailouts – let them fail. They would be absorbed. Keep taxes low – it will stimulate the investment. When you lead the entitled non taxpaying majority into power, it is normal that you “pay” them to stay in power. The problem is that portion of the population does not produce the jobs or the income needed to pay for the needs of the nation.
As many have already pointed out, the out of control spending increases will likely lead to future taxes that will effect more than just people who make over $250K. If not then they will likely lead to monetization of the debt and inflation, which is an effective tax on anyone with savings or with incomes that don't increase to keep pace with inflation.
In response to "affects only those families with annual income above $250,000"
1 - Some of the currently planned tax increases do hit people who make under $250K
2 - Some of the people protesting do make over $250K or can reasonably see themselves making that much in the future.
3 - People who make under $250K can realize that "soak the rich" is neither fare nor good for future growth.
As for "Something that would happen anyway were the Bush tax cuts to expire on schedule"
That's pretty much irrelevant. The tax increase is still a tax increase.
As for "will start in 2011", that's not exactly very far away. If your going to stop it you need to get momentum going against the idea.
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I recomend Don Don Boudreaux's letter to the New York Times on this issues
"...But is it really so absurd for ordinary Americans to be furious that Uncle Sam now promises to run up $9.3 trillion in debt during the next decade - an unfathomable sum that will inevitably lead to much higher taxes or higher inflation or both? Is it small-minded to oppose corporate welfare for automakers, banks, and insurance companies? Is it lunatic to fear further socialization of medical-care provision? Do these concerns really signal that those of us who hold them are, as Mr. Krugman alleges, "refusing to grow up"?..."
http://www.cafehayek.com/hayek/2009/04/tead-off.html
"Bush created this mess! Bush created this mess!"
While I agree that Bush and company did not leave us much to cheer about on the fiscal front, how about all you leftist lemmings take a chill pill and ponder the fact that under Obama, in less than 100 days, we have now QUADRUPLED the WORST of the so-called Bush deficits. Also consider that the worst of these deficits came at the END of the Bush era, when, hmmmm, which party was in control of Congress?
While Obama doesn't deserve all the blame, he's certainly the great enabler in this colossal financial mess. Pelosi and Reid get major supporting actor awards, along with chief puppeteers David Axelrod and Rahm "never waste a good crisis" Emanuel.
The irony is that we may all owe these clowns in DC a debt of gratitude, because it's thanks to these guys that the silent majority has FINALLY been shaken out of its stupor. Perhaps there is hope now, for the first time in decades, that we can finally turn our country back toward the principles embraced by our founding fathers, who must all be turning in their graves right now.
The bottom line of these TEA Party protests is this: The vast majority of the politicians in office today, especially the corrupted career politicians, need to be tossed out on their duffs and replaced with people that retain a shred of fiscal sanity amidst this madness. We need people in Congress who understand that without a vibrant private sector you can never hope to achieve even a fraction of all the hopey-changey ideals that Obama supposedly wants to see to fruition (many of which should not be any of the federal government's business in the first place).
Wild spending and the corresponding tax burden we're saddling on future generations is precisely the opposite of what we should be doing. It's as if Congress and the White House took their fiscal cues from Jihadist operatives looking for a way to cut us down. Wake up, America!!
Thank you for the sober exegesis of the implications of Obama's economic plan.
The paltry attendance (the entire nationwide attendance barely equals a single Obama campaign rally), despite the 24/7 promotion and participation by Fox News celebrities, Limbaugh, Malkin et al speaks for itself. And the messages on the signs and in the speeches refute the claim that this is about fiscal irresponsibility.
America HAD its tea party on November 4. Either respect the will of the people, or secede, as Gov. Perry is threatening to do. (Don't let the door hit you on the way out, Rick.) If you don't like the democratic system, leave.
You overlooked the fact that Goldman and JP Morgan have already indicated that they will soon be repaying the TARP funds. Classic Keynesian economics: the government provides short-term spending to cover a shortfall in demand, until equilibrium can be restored. Doesn't that demonstrate that Obama's policy worked EXACTLY as designed?
Of course, these people will never be satisfied with anything this president does. It's a visceral, irrational hatred.
Came upon this thread linked from Sullivan. Man, now I know why he doesn't allow comments now.
I think I'll address JoeBob, because, although I don't agree with him at least he organized his thoughts in a coherent manner while addressing Adam.
1."Your argument is that being overtaxed and having our money squandered in the past justifies continuing that disservice today?"
So a highest marginal tax rate of 35% is just right but a highest marginal tax rate of 39.6% is socialist? What would be the right level for the highest marginal tax rate, both to responsibly pay what we owe now and to continue social programs deemed necessary. Cut taxes too much and you're gonna see STEEP cuts in the Big 4. Most of the budget goes to those programs, and not to "pork projects" as many would try and get you to believe.
2. "Flat tax dead-ender - Such a great term – what nomenclature would you attach to the taxing system we have today – fair – balanced? Try calling the IRS for an answer to a difficult tax question. My view is that the method of taxation in use today is too difficult to follow and inherently unfair to the taxpayer. A flat rate Income Tax coupled with a consumption (VAT) tax along with property tax will hit all taxpayers with the larger consumer paying more taxes as they consume more. I am not advocating for this particular tax program, just cannot fathom the 65,000 pages of our existing tax code."
I actually kind of agree with you on this point. While, I do favor a progressive tax, I think pretty much everyone can agree on tax code simplification. In my ideal world, I'd want a lower, more gradual income tax rate (that didn't end at $400,000), get rid of all deductions except for charitable giving, dependents, and MAYBE home ownership. For people who are very concerned with the debt, however, any tax code changes will have to be at least revenue neutral for the time being. After we get the debt and deficit under control maybe things can be different.
3. "You seem intent on mixing several ideas together here. Try to present a cogent though process.
FDR did his best to spend us out of the Great Depression and failed miserably. Can you present any evidence of any government that bought/spent it’s way out of a major recession?
I can see that you assume Trillions of Dollars squandered on inumerable pork projects is not going to cause taxes to be raised to pay back foreign governments that purchased our securities. In the past, when we had deficit spending we owed that money to ourselves, in todays environment we are spending other monies that we are have to borrow."
Actually, FDR did a decent job in spending us out of the Depression until he went back to a more fiscally austere policy after the 1936 election. Although, people can take their Keynesian impulses a bit to far, in general, picking up the slack in demand during a recessionary period is the right thing to do. And to answer your other question, yes, I can present evidence of a government spending it's way out of a recession. It's called World War II. New Deal critics always talk about how the New Deal didn't get us out of the Depression, that it was WWII. But what was WWII, economically speaking, except a massive government spending/jobs project the likes of which we've never seen before, or hopefully ever again.
Also, again, the deficits are caused by Big 4 spending, not pork projects or even really discretionary spending. It's a complete strawman to beat up on that people beat up on because it's easy to say that it's bad. What we really need to decide is how to get healthcare in order and save money on military expenditures.
"I had assumed that the great economy we rode through for the last decade or so was evidence that we were on the right track. Seven or Eight years ago the issue of fraudulent home loans to people flipping homes or buying homes and installing renters as a way of fraudulently cashing out on home values was being discussed in meeting that I had with mortgage lenders. The federal mandates put forth by the Fannie mae and Freddie Mac crowd sponsored by the Barney Frank and Sen Dowd was limiting how much effort the lenders were willing to put into the screening effort. It was possible to end up in a discrimination lawsuit if you looked to hard at some of these applications. It is difficult for me to see why you are outraged at the Republican Presidents who were in charge of such strong economies."
We didn't really ride a great economy for a decade. The last (mild) recession ended in late 2001 early 2002. And again, the federal mandates are a small and unimportant in the grand scheme of things. The real problem was the absurdly low interest rates, that Greenspan kept down even after the recession was over. Lots of easy money, lots of easy loans, lots of money to be made on the securitization of those easy loans. Companies might be scared of a discrimiation lawsuit, but they're not that scared. They did it because there was money to be made and little oversight, plain and simple.
And finally, the best economy we had was during the Clinton years (and he did a lot of things I disagreed with)... I know, I know, it was because of Reagan. If the economy recovers under Obama that'll probably be because of Reagan too.
4. "I am advocating – No bailouts – let them fail. They would be absorbed. Keep taxes low – it will stimulate the investment. When you lead the entitled non taxpaying majority into power, it is normal that you “pay” them to stay in power. The problem is that portion of the population does not produce the jobs or the income needed to pay for the needs of the nation."
I understand this. It's terrible seeing these banks get rewarded for their failure- they're already licking their chops at the thought of the PPIP auctions. I think Obama is too beholden to the financial industry, just like Bush, just like Clinton, just like HW, and just like Reagan. I actually think a short period of nationalization would be best, and then dicing them up into smaller, more manageable pieces. But that's socialism right? And so are the bailouts. Is there a non-socialist plan that would prevent the deepening of the crisis (which large bank failures would almost certainly do)? I think that without any type of plan with a federal scope, the cascading defaults would be too great, and it'd be something our system would not be able to contain.
These "Teabaggers" are a direct result of this country's embarrassingly pitiful education system. They are advocating policy positions which are directly anathema to the vast majority of their interests, as usual.
They are protesting the national debt? They are protesting government spending? They are protesting against the cigarette tax? These are some of the most ignorant and uninformed people in the country, screaming about burning books and holding up blatantly racist and hateful signs.
Where have these people been for the last 8 years? Now they're outraged? Where was the moral outrage while we were torturing people? Where was the moral outrage when we were bombing and invading a country that did not pose a threat to us? What about all that money Bush spent to do those things? Where did they think that was going to come from? Did they really honestly believe we could cut taxes and spend all the money in the world and never have to pay for any of it?
Barack Obama ran and won a election based on his policy positions. The majority of the American people voted for him because they made the decision he was the best man for the job. He is now implementing many of those policies he ran on. None of these positions should be a surprise to anyone, because they got him elected. These people are protesting because they simply do not like the fact that they lost and the other guy won. And the other guy happens to be Black! Oh No! He has only been in office for a few months and has been forced to make many difficult decisions. Obviously, we would all prefer to not be in this terrible economic situation, but it is not of his own doing. We would rather not bail out entire industries, but If you had an infected leg and had to choose between dying and amputation, which would you choose? Neither one is a pleasant choice, but you have to do something. Cutting government spending is not an option. No one, save for a few right wing house members who couldn't govern themselves out of a wet paper bag, advocate such a stupid economic policy response to this crisis.
The fact is that the majority of Americans will see their taxes go down. If you happen to choose to smoke, that's your problem. We the tax payer end up paying for you health care at some point down the road anyway, so we might as well charge you for it directly, no? It is also true that even though taxes are being increased on the most wealthy, their taxes will still be lower then they were when Reagan was president! Remember him?
I assume every single one of these people will now forever renounce ever collecting any government service or assistance for the rest of their lives. No unemployment insurance, no medicaid, medicare, or welfare of any kind. Hell, might as well swear of police and fire department service and garbage pick up too right? Oh, and lets get rid of all government regulation! That would be swell wouldn't it? No government interference in our lives at all, except to tell us what church to go to and who to marry and what ethnic group to hate this year.
This kind of right wing mentality is why we are and will continue to fall behind the rest of the western world. People like this will stand in the way of progress to matter what the cost to themselves or the country because they are ignorant and hateful. Their children will never be able to compete with the rest of the world, and we will be doomed to serve each other hamburgers for the rest of our lives, because of these "Teabaggers".
They are advocating policy positions which are directly anathema to the vast majority of their interests, as usual.
I submit that they may understand their own interest better than you understand their interests.
They are protesting the national debt? They are protesting government spending? They are protesting against the cigarette tax? These are some of the most ignorant and uninformed
What's particularly ignorant or uninformed about protesting spending, debt, and taxes?
Where have these people been for the last 8 years? Now they're outraged?
The annoyance was building up, now you take all the spending and deficits from Bush and continue with spending and deficits, adding to the problem, and not just continuing with the problematic policies but making them much worse since deficits and spending will both be higher.
None of these positions should be a surprise to anyone, because they got him elected.
Obama talked about a net spending cut. I guess in important ways we aren't getting what we heard before Obama was elected.
The fact is that the majority of Americans will see their taxes go down.
That's questionable, esp. if you recognize that "cutting income tax" for someone who doesn't pay any income tax isn't a tax cut but rather a handout, and when you consider that cigarette taxes, and any possible carbon taxes will be a broad based tax increase, hitting many people (the former hitting tens of millions, and the later hitting almost everyone).
I assume every single one of these people will now forever renounce ever collecting any government service or assistance for the rest of their lives. No unemployment insurance, no medicaid, medicare, or welfare of any kind. Hell, might as well swear of police and fire department service and garbage pick up too right?
When an already bloated government spends additional trillions of dollars you aren't talking about just reasonable spending on the most important or popular programs.
Also protesting too much spending hardly creates a moral or rational requirement to forgo taking some of your money back, when you can't stop the government from taking it in the first place.
This kind of right wing mentality is why we are and will continue to fall behind the rest of the western world.
Over recent decades much of the western world has been falling behind us in relative terms, often because of bloated government with excessive regulation and taxes, but I suppose now we may join them in that, on some particular points of taxes and regulations we are already worse off.
Joe goes to Dr. O. and discovers he has some nasty stomach cancer. Dr. O. Tells him he needs serious surgery -- if he does nothing he will likely die.
Should Joe be mad at Dr. O.? Perhaps it is more reasonable to be upset with his two previous two physicians, Dr. B. and Dr. C. who let the cancer run rampant undiagnosed and untreated.
Will Dr. O's surgery work? Maybe. Maybe not. And if it doesn't work due to some skill failure, then Joe has a good reason to be upset with Dr. O. Being mad as Dr. O starts to operate seems a bit premature.
I can understand being upset with the state of our economy and the implications for taxpayers -- but do what is the alternative to the spending and bailouts? Anybody?
People want to believe that the alternative answer of 'not taxing' is going to somehow magically solve everything despite the fact that most economists believe that doing nothing (i.e. not spending/bailing out) would likely kill the patient.
If Dr. O is telling the patient that huge expansion of an already bloated federal government is the way to health, than Dr. O is a quack and we should be mad at him.
I doubt you agree with that, but certain you would at least recognize that as uncertain as medicine can be politics is even less certain, and also an issue reasonably less subject to deference to experts or powerful people than medicine. A doctor, while far from a perfect authority, is generally a reasonably good authority for medical issues within his specialty. A politician like "Dr. O", is not an authority that would normally get or should expect such deference.
but do what is the alternative to the spending and bailouts? Anybody?
That alternative is to not have the spending and the bailouts, or at least not have most of the additional proposed ones.
the fact that most economists believe that doing nothing (i.e. not spending/bailing out) would likely kill the patient.
That isn't true. Not pushing huge new bailouts and other spending isn't doing nothing. Not having such spending won't "kill the patient", and its not even true that most economist think it will.
One more thing to get upset about.
It is foolish to argue that the tea-party people are protesting only because Obama is Black.
It is equally foolish to believe that some part of the antipathy for government in some of the protesters is NOT due to an either outright or hidden kind of racism.
It is a well-known finding that , even in those who feel like they are being 'fair' about race judgments, that when things go bad, people are often more likely to make negative attributions to a member of a minority group.
My mom says she hates congressman Barney Franks, but according to her, NOT BECAUSE HE IS GAY. Although she has referred to him as a 'stuttering gay fag' -- you tell me that his sexual orientation isn't some part of her hatred...
This hidden bias against minority members can even be demonstrated in the most liberal groups of people such as college students at UCLA, so we don't have to wonder if it also exists in the mostly republican tea-party protesters.
One final note -- just because people are in some part motivated by racial prejudice does not invalidate their position -- they may also have noble/valid motives for protesting, but it is good to remember the entire picture may be quite complex.
It is equally foolish to believe that some part of the antipathy for government in some of the protesters is NOT due to an either outright or hidden kind of racism.
I wouldn't agree that its equal, but your right it is foolish to think that racism plays no part whatsoever for even a single protester.
But that isn't a relevant issue. Sure take 300,000 protesters and I'm sure you'll find a few racists, but racism is not a significant element of the protest. The idea that it is to a significant degree about racism is fairly clearly incorrect. Even if it wasn't so clear, a charge like racism generates more heat and distortion than light and understanding if you throw it around without serious evidence.
It would appear that a number of my fellow commenters are against big government, and current and future spending levels. These include people whose mom's are on Medicare, who rely upon huge farm subsidies, who believe in a gigantic defense budget, . . .
It's pointless to go on about profligate spending without doing something that few Americans (and judging from the signs and slogans, few teabaggers) like doing: looking into the details.
Give me my tax money back, and I can afford my mom's medical bills. Give me my tax money back, and I can afford slightly more expensive food. Stop attacking random countries, and we won't need such a large "defense" budget.
Somehow, the government has been able to take money from our pockets, give some of it back to us, and make us grateful for the "gift".
What are they protesting?
Multiple things but the image here is a good quick way to show one of them.
http://www.coyoteblog.com/coyote_blog/2009/04/why-people-are-angry.html