patrick.net

Wow--you're really reaching now. You're complaining about something that might happen in the future. And I still hate that people call it a tax hike. The law was written with a start and stop date--it was always temporary. The tax cut period is over and now we're back to level.

I don't recall Obama ever promising to extend the Bush tax cut. Even so, I don't really care what was promised in the strictest term, I hate to think the president is obligated to follow through on things that was talked about two years ago. I only care about making the right decision right now based on current facts. If the right decision is opposite to what was promised, I rather have the president make the right choice instead of making a choice based on promise.

Having said that, tax on dividends potentially looks pretty brutal going forward Thanks for pointing it out so I can plan for it accordingly.

(40%+ coporate income tax rate fed and state and then another 39.6% + 9.8% tax on dividends, why even bother to be profitable and distribute in America).

Corporation 100 net income
Federal/State income tax (40) Fed and State/foreign
Net Income after tax 60
Dividends tax fed (24)
Dividends tax state (6)
Income/Distribution net of taxes 30
Government take 70

SF ace says

(35% coporate income tax rate and then another 39.6% tax on dividends, why even bother to be profitable and distribute in America).

Exactly. High taxation always works as a disincentive.

The 2001/2003 cuts were voted in by a republican congress and republican president. And this is Obama's fault because..."

According to wikipedia: "The Congressional Budget Office estimated that the tax cuts would increase budget deficits by $60 billion in 2003 and by $340 billion by 2008."

But that's okay by you, because you have demonstrated a hatred of all things Obama and lack the ability to think for yourself. Do you wonder why we don't take your posts seriously, rayray? You have nothing new or interesting - or pertinent - to say.

Yawn.

so, let me get this straight, you blame Obama for a future tax hike because the chosen one Bush didn't have the intestinal fortitude to make his taxs cuts without gimmics, etc. like the sunsets on them?

At some point, don't you smell what your shoveling?

There goes another Obama campaign promise.

As long as the Bush cuts are retained for the 28% brackets and below there will be no broken campaign promises.

The increased taxation on the upper classes is a necessity given the increasing centrifugal economy we are living within.

I know your ideology has blinded you to this fact RayAmerica, but the taxation level is rather orthogonal to the real economy. Prices (largely real estate) just compensate and life goes on.

This is why the Norwegian economy is not crippled with its high taxation. Same thing with Germany's:

Time to find me a cash paying job.

Vain says

Time to find me a cash paying job.

Returning to the taxation levels of the 90s is not the end of the world. SHeez. People who supported the war and tax cuts at the same time are mentally challenged, in denial, or have a larger agenda of destroying the ongoing viability of the current welfare state, something they cannot achieve directly.

"Should any political party attempt to abolish social security, unemployment insurance, and eliminate labor laws and farm programs, you would not hear of that party again in our political history. There is a tiny splinter group, of course, that believes you can do these things. Among them are H. L. Hunt (you possibly know his background), a few other Texas oil millionaires, and an occasional politician or business man from other areas. Their number is negligible and they are stupid." -- Eisenhower in a private letter to his brother in 1954.

Unfortunately, these millionaires funded a slew of propaganda mills -- Heritage, AEI, Hoover, Discover Institute, FOXNEWS, etc -- so the number of anti-government types as described in this letter is no longer few. But they are still stupid, usually in the sense of one's ideology making one stupid.

"Liberal misconceptions foster economic irresponsibility, social conflict and political incoherence. By undermining capacities for self-reliance, voluntary cooperation, moral realism and informed altruism, they degrade the character of people.

The Liberal Mind, The Psychological Causes of Political Madness, by Lyle Rossiter, M.D.

The increase in personal income tax should be good for home prices in the sub-million dollar mortgage market. Hey, every little bit counts...

Troy says

There goes another Obama campaign promise.
As long as the Bush cuts are retained for the 28% brackets and below there will be no broken campaign promises.
The increased taxation on the upper classes is a necessity given the increasing centrifugal economy we are living within.
I know your ideology has blinded you to this fact RayAmerica, but the taxation level is rather orthogonal to the real economy. Prices (largely real estate) just compensate and life goes on.
This is why the Norwegian economy is not crippled with its high taxation. Same thing with Germany’s:

Norway is a small, oil-dependent economy with no crime and no military, hardly a comparison.
Germany's GDP per capita is less than the US, and I wouldn't exactly envy their position right now given all of Europe's fiscal difficulties.
The upcoming tax increases amount to about $100 billion (probably more including state increases). This is money being sucked out of the economy in a time of economic weakness. We have already 'spent' that money on the 'stimulus' so it's not like it's going to be recycled.
Even liberal Christina Romer put the tax multiplier at 3:1, so that's about $300 billion in a $14 trillion economy. We can expect about 2% GDP loss from the tax increases alone.
Liberals can have their head in the sand and believe it's just super rich millionaires who just used that money to wipe their ass, but that's not the case. Extracting $4k extra a year on someone who makes $350k a year owning a small business not only decreases their spending/personal investment, if the business they own requires capital equipment (which most do), it lowers their rate of return on investing in capital equipment (which is often a precursor to hiring).
Example: I can invest in $100k of capital equipment which I would depreciate over 10 years ($10k deduction a year). I expect to make about $25k of cashflow each year from it. Taxes on that $15k (25k-10k) go from say 35 to 40%, so after tax is return is smaller. The amount of time it takes to get back the original investment is longer. May tip the decision to not invest in the equipment (and since you don't invest, you also don't need some guy to run the equipment).
In the 90's, we had free trade liberalization, a tech boom, and a capital gains decrease in 1997. We also had lower state taxes and fees.
The most obvious comparison with now is 1937, just a matter if that's 'priced in' or not yet.

Honest Abe says

“Liberal misconceptions foster economic irresponsibility, social conflict and political incoherence. By undermining capacities for self-reliance, voluntary cooperation, moral realism and informed altruism, they degrade the character of people.
The Liberal Mind, The Psychological Causes of Political Madness, by Lyle Rossiter, M.D.

ya know, abeabe, to be considered "well-read" and be taken seriously, you might want to read something with a message other than Lib bad/conservo good. These books have warped your little mind and turned it to conservative mush.

The Bush tax cuts were borrowing money from the future to put into the pocket of the relatively rich now. They were not "payed for." To have those cuts at the same time that off budget wars were occurring, and then unpaid for prescription benefits were given, was truly astonishing.

The astonishing part is how they somehow mange to get a huge chunk ( of relatively ignorant ) Americans to go along with it. Now after the economy has gone over a cliff, and Bush and then Obama spend a lot trying to keep it from going all out "depression," then FINALLY these same mostly republican voters ( good family values Christians ) are up in arms over the deficit.

I know that I have my lens too, but give me a break.

Oh, and Obama actually always promised to let the Bush tax cuts for the rich expire. If he allows other tax increases from congress, maybe it's so that he can promise ( and deliver ) tax cuts again in 2012 as he did in 2008. That's right democrats finally stole that from the republican play book: lower taxes (pay the voters) if you really want to win elections.

The hell with Obama. I say we lay him off, make no changes, and his would be salary needs to go in a SAVINGS account. Yes. Save :)

Vain says

The hell with Obama. I say we lay him off, make no changes, and his would be salary needs to go in a SAVINGS account. Yes. Save

It's time the rich, super rich, and the corporations pay their fair share. Too long have they had a break at everyone's expense. Too long have they used "drill baby drill," wars, and tax cuts that only favor the rich, super rich, and the corporations killing the planet while running up the deficit to insane levels. All the while they've been laughing all the way to the bank (usually foreign to avoid taxation on savings and investments) gathering up the money without paying workers their fair share of the spoils.

It's class warfare they attempted to win, now it's our turn.

Honest Abe says

“Liberal misconceptions foster economic irresponsibility, social conflict and political incoherence. By undermining capacities for self-reliance, voluntary cooperation, moral realism and informed altruism, they degrade the character of people.
The Liberal Mind, The Psychological Causes of Political Madness, by Lyle Rossiter, M.D.

Thanks for posting this Abe. This sounds like a great book. I put it on my short list of books to read in the near future. BTW, you might want to ask ellie "I never, ever insult anyone" mae a reference as to what book she's read recently that is from a conservative perspective instead of liberal minded mush. Don’t hold your breath for a for a meaningful response. LOL

PS: I don’t believe she likes books very much.

The premise of this post is wrong. I tried to confirm it and can't. The truth is there will be an amazing political opportunity for Obama. When the Bush tax cuts expire, if left alone then yes this would happen:

The 10% bracket rises to an expanded 15%
- The 25% bracket rises to 28%
- The 28% bracket rises to 31%
- The 33% bracket rises to 36%
- The 35% bracket rises to 39.6%

But guess what (lol), it will be an opportunity for Obama and congress to lower taxes again, effectively reimplementing the bush tax cuts but only for the lower two or three of these brackets. Ahhh,.... politics. What an incredible opportunity !!

I love it. That is so awesome !!!!

RayAmerica says

PS: I don’t believe she likes books very much.

I do too like books! I have one holding up my family room couch at this moment.

Good try rayray. I like it how you reference me in almost every post and write my name with little love notes. It's cute.

RayAmerica says

BTW, you might want to ask ellie “I never, ever insult anyone” mae a reference as to what book she’s read recently that is from a conservative perspective instead of liberal minded mush. Don’t hold your breath for a for a meaningful response.

Abe ... see what I mean?

elliemae says

I do too like books! I have one holding up my family room couch at this moment.

Ray, I have also asked for some recommendations for books. I have gotten one suggestion, ONE. Not six, or four, or even two...ONE. It was a book by Krugman, who, as you know is one of those intelligent but economically illerate economists - hahaha.

The lefties can't stand the truth, common sense, supply and demand, personal responsibility, the law of unintended consequences and prefer to shoot the messenger instead. Ignorance is strength.

So to you feel good liberals, I have a question: OTHER than Krugman...any suggestions for books to read ?????

Does it have to be a book in the "telling me what I want to hear" category ? Or can it be any book.

Honest Abe says

So to you feel good liberals, I have a question: OTHER than Krugman…any suggestions for books to read ?????

I'd suggest Freakonomics

E-man .... thanks for the recommendation. I'll check it out.

E-man, The Richest Man in Babylon is a great book, one of my favorites, along with Think and Grow Rich, The Millionaire Next Door and anything by T. Harv Ekler.

Much of the underlying content of those books is related to PERSONAL RESPONSIBILITY, CAUSE AND EFFECT, MAKING RESPONSIBLE CHOICES, SAVING AND INVESTING, LIVING BELOW YOUR MEANS, LEARNING "HOW MONEY WORKS", STAYING OUT OF DEBT, THE RULE OF 72, THE TIME VALUE OF MONEY, ETC.

Notice how many of those issues are shunned, scorned and ridiculed by liberals. After all, liberals want a parental government to assume all those obligations. There is a name for that type of dependent existence: The Nanny State.

In my reading it became pretty clear that people could choose to be in control of their own lives (freedom)...or give up control to the state (which ultimately leads to tyranny). Well DAH, its a pretty simple choice, isn't it?

SF ace says

That’s the only fair route. It was a temporary tax cut afterall

"Fair". LOL. Tough to get that black Amex if your taxes go up 360bps or 10%?

Here's the deal. If you want to really damage the economy all you have to do is raise taxes on wage earners, who are already strapped. The rich, by definition, are not financially strapped. Quite the opposite as their share of the national income continues to rise.

You want "fair"? Raise taxes until those lines on the graph meet in the middle.

I'd say "fair" is the tax code of the 1950s or early 1960s...

I think you guys took "fair" a little too literally. There is no such thing as fair taxation, someone will be paying more and some less. I get that. I think it is more administratively practical to just not extend any part of the Bush tax cuts, not pick and choose the part that favors A, B or whatever. Whatever was gained/given the last 9 years by Bush tax cut is just taken back, sounds like a good start to me.

"Anyway regarding fair, how fair is it that a blue collar worker creates $100 an hour worth of wealth but only gets paid $20 an hour? There’s nothing unfair about taxing rich people more money however it really is besides the point. ONLY A PROGRESSIVE TAX SYSTEM CAN BE SUSTAINED! Without it, the economy is nothing more than a closed ended game of Monopoly."

That is too simplistic, the only reason why someone is getting paid $20 in the first place is somebody have to risk the capital. Do you alienate your top customers or do you want to make them happy? If you are the San Jose, do you kiss up to Cisco or do you have the balls to tell them to pay more tax. If I was running an insurance business, I sure as heck would kiss up to the agents that have the biggest insurance books. If you don't, they'll take the book somewhere else. That's the reality.

If you think we can go back to the way it used to be, we can't, there are too many choices out there. There are countries that don't tax dividends and welcome your investment $$ and people can move them out and you end up getting nothing instead of something. We already see that in Coporations as it is race among tax controller to get the lowest effective tax rates and can easily apply to the rich. Why do you think every state competes with each other and redevelpment zone will welcome you (with tax breaks) if you can employ 500 people, it's because they want something rather than nothing.

SF ace says

I think it is more administratively practical to just not extend any part of the Bush tax cuts, not pick and choose the part that favors A, B or whatever.

How about picking and choosing to create a tax code that strengthens the US economy? Isn't that the job of the politicians?

I'm all for tax raises across the board since I think all taxes come out of rents in the end. But Obama was elected with the promise of not raising taxes on the middle class and below. Conveniently, the Bush tax cuts favored the upper class, so reversing those will result in the most bang for the buck.

We could use a few more tax brackets to smooth out the curve, too.

Right, and I suppose you think that poor, innocent people are subject to this suffering inflicted by various predators like: "Big Business", "Big Corporations", "greedy capitalists", "U.S Imperialists", "the oppressors", "the rich", "the wealthy", "the powerful" and "the selfish".

And I suppose you think that none of their agonies are attributable to faults or failings of their own: not to poor choices, bad habits, faulty judgement, wishful thinking, lack of ambition, low frustration tolerance, mental illness, poor work ethic, or defects in character.

And you blame faulty social conditions, poverty, disease, racial or sexual prejudice, ethnic and gender discrimination, capitalism, globalization, and imperialism.

And the cure? An endless and constantly growing intrusive, authoritarian, manipulative government that regulates and manages society the way they think society should be "managed". "Big Brother" knows how your life should be lived...much more than you do.

These distorted perceptions and its destructive agenda are surely the product of disturbed personalities.

Here, let me proof your work:

Honest Abe says

An endless and constantly growing intrusive, authoritarian, manipulative government that regulates and manages society the way they think society should be “managed”. “Big Brother” knows how your life should be lived…much more than you do. Currently this is the result of 30+ years of Conservative and Republican politicians going after the middle class while enriching their corporate masters and themselves.

There, that's closer to the truth.

Thanks for playing Abebabe.

Yeah, if more people had the right attitude and were more self reliant and responsible, then manufacturing would have never decreased here. (by the way, i personally don't blame republicans or democrats for globalization)

In a parallel universe where everyone has the right attitude, what does the US look like ? Is everyone a professional, because they all pulled themselves up by their boot straps while they were is school. No that doesn't work. We need workers. But what kind of living should workers make ? And don't they actually need to make enough so that they can consume enough to keep the economy steaming along ?

I guess maybe they should just work two or three jobs each, and be happy to do it. And they should stop complaining. Because even though we can't all be doctors, lawyers, engineers or investment bankers, if you aren't one of those you only have yourself to blame (sucka).

Honest Abe says

y, I have also asked for some recommendations for books.

The lefties can’t stand the truth, common sense, supply and demand, personal responsibility, the law of unintended consequences and prefer to shoot the messenger instead. Ignorance is strength. So to you feel good liberals, I have a question: OTHER than Krugman…any suggestions for books to read ?????

abeabe:

A few books for you to read: Any of the Bloom County books (full of truth, common sense, supply and demand...), Green Eggs and Ham, and for a little levity I'd recommend the Far Side series.

I find it amusing that you claim to want to learn more about personal responsibility when all you do is whine about being a victim of the libs. And - rayray, attempting to bait me doesn't work because you're a troll and (in case you haven't noticed) no one seems to take you seriously. Being obnoxious doesn't make you pertinent.

elliemae says

abeabe

elliemae says

rayray

I wonder why ellie finds it necessary to repeat first names? Maybe it stems from her "Mommy Mommy" days. I guess some people just never grow up. LOL

RayAmerica says

I guess some people just never grow up. LOL

Lookin' in the mirror & talkin' to yourself again, rayray?

elliemae says

Lookin’ in the mirror & talkin’ to yourself again

How old is that one? I'm guessing maybe a thousand years? At least make an attempt to be a little original, even if you have to copy from someone.

RayAmerica says

How old is that one? I’m guessing maybe a thousand years? At least make an attempt to be a little original, even if you have to copy from someone.

I refuse to have a battle of wits with someone who lacks ammunition.