Republican Tax Bill Is A Prelude To Higher Taxes
Yesterday the Republican controlled U.S. Senate passed a gigantic tax bill. The House will today agree to it and Trump will sign it as soon as possible.
The bill lowers the corporate tax rate from 35% to 21%. It lowers the top tax bracket from 39.6% to 37%. It will burden at least half of the poor people. It is wholesale looting:
When fully-phased in, the bill will give 83 percent of its benefits to the top 1 percent. Incredibly, it raises taxes on half of working families.
Republicans always argue along the fraudulent theory of supply side economics. They claim that higher income for companies will allow them to invest more and to thereby increase economic activity. It is a stupid argument. There is no empirical data to support it and no real social scientist takes it seriously. Most companies do not lack money. They can also borrow at record low rates. No company holds back on investing if there is additional profitable demand for its products. Without additional demand there is simply no justification for any additional investment.
Demand can not increase if the people have no money to buy. To increase demand, disposable income has to rise via higher wages, more welfare distribution or less taxes in the lowest tax brackets. (An increase of consumer debt can only work so long and has negative long term consequences.)
The new tax law will increase the federal deficit by roughly $1.5 trillion over ten years. The giant rise in debt is intentional. It will be the justification for step two of the republican plan to bring the U.S. back to the Gilded Age. Speaker Paul Ryan already announced such plans:
Congressional Republicans and the Trump administration are eyeing sweeping legislative and regulatory changes to the country’s welfare system next year.Speaker Paul Ryan (R-Wis.) said he wants to use the fast-track reconciliation process next year for entitlement reform, with a focus on promoting work and career-based education.
...
There’s broad support in the Republican conference for changing the federal safety net to impose stricter work requirements on programs like Medicaid and food stamps.
For now the Republicans will likely hold back on medicare and social security. These are earned benefits, not "welfare". Even Republican voters want to keep them without major changes. Any attempt to touch these programs would lead to a heavy electoral backlash. It is thereby unlikely that the Republicans will be able to steal enough from the poor to compensate for all the money they now hand to the rich. Instead they will increase the federal debt.
While most voters do not like the current tax bill, the Republicans might benefit from it in the 2018 midterm election. Most of the negative effects of the bill will only be felt in 2019 and later years. It is those future years that the republicans have to fear. As long as interests rates are low an increase in federal debt has little effect. But when interest rates rise, as they will, the federal budget situation will become way more difficult.
The mini-Reagan in the White House and Republican Congress members like to compare their current bill with Ronald Reagan's 1981 tax bill. That one went into a similar direction than the current one. The top tax rate decreased from 70% to 28%. But by 1982 and in later years Reagan had to introduce the highest tax increases ever to keep the budget at least somewhat stable. Tax revenue as a percentage of GDP did not decrease at all under Reagan.
The two steps of decreasing taxes and slashing welfare the Republicans planned for will likely be followed by third (and forth) step that will decrease the impact of the original bill. Historically the overall positive and/or negative impact of this pandering to their rich sponsors will likely be much less than both sides of the aisles are predicting.
Posted by b on December 20, 2017 at 19:54 UTC | Permalink
next page »thanks b... i have grown very tired about all the talk on tax breaks and etc... would usa people like to have any kind of gov't and infrastructure paid for thru taxes? what is wrong with taxes to support a functioning gov't? i understand many people in the usa would like to have a medical system like the one in canada, or an educational system like those in Scandinavia, but it does require revenue that the gov't gets somehow... opps... better hand it all over to the corporations and not impose any limitations on any of them... yes - this is very pro business - pro corporate run world.. is that what americans want? well - it looks like they have it already.. and how is it working out? the same kleptomaniacs are calling the shots.. trump epitomizes this too... i can never wrap my head around usa politics... maybe psychohistorian will have something relevant to say..
Posted by: james | Dec 20 2017 20:54 utc | 2
You are much less good on economic issues than foreign policy issues.
Posted by: jfb | Dec 20 2017 21:03 utc | 3
Chronic poverty is indeed a giant problem in the US. BUT one could also say that enabling the cycle of poverty through government handouts does little to sate the yearning in the human soul to work and provide for their family. The Rethugz theory on entitlement reform will no doubt be laughable in its outright stark meanness, but if there was a way to get people back to work, I think the ailing western spirit inundated with advertisement of a faraway celebrity culture, would be all the better for it.
Posted by: NemesisCalling | Dec 20 2017 21:16 utc | 4
The Democratic Party secretly loves this bill. Their billionaire owners/funders get huge benefits while the Democratics can blame the lack of federal money on the Republicans. They have plenty of energy to scream, "Russia, Russia, Russia!" but not much to actually fight something that's a huge negative for the majority of their voting base.
Posted by: WorldBLee | Dec 20 2017 21:16 utc | 5
This is the usual taking from Peter to pay Paul scenario. It's a false savings and you only end paying more later. Trump get's a zero from poor people like me for this.
Posted by: Fernando Arauxo | Dec 20 2017 21:32 utc | 6
Taxes pay the interest the Federal reserve demands on the money it prints for the Treasury. Lowering taxes increases the printing of fake money and the more fake money the higher the inflation and the higher the inflation the more homeless, and the more homeless, the easier it is for the wealthy to get someone to fix the furnace when it quits on Christmas day. Bitcoin not fake government printed money, likely will stop the wars and achieve peace.
Posted by: fudmier | Dec 20 2017 21:41 utc | 7
I forgot to add this link
https://journal-neo.org/2017/12/20/russia-and-china-challenge-dollar-domination/
Posted by: fudmier | Dec 20 2017 21:44 utc | 8
It's long past time to start hanging these plutocrats from lamp posts.
Posted by: SlapHappy | Dec 20 2017 21:48 utc | 9
I'll again point to this chart that apparently few bothered to click on yesterday as it nicely details who benefits from the so-called tax bill.
Posted by: karlof1 | Dec 20 2017 21:50 utc | 10
@SlapHappy, #10
They sold the lampposts to China. And cut the trees down, lumber went to Japan.
I suggest just dragging them through the streets. Plenty of pot holes to beat them to death.
Posted by: Red Ryder | Dec 20 2017 21:51 utc | 11
The first Gilded Age was leading to a socialist revolution in the USA, until FDR's New Deal legislative reforms blunted that momentum. Contrary to libertarian economic theories, the zenith of American economic growth (1950s-60s) occurred during a period marked by high tax rates and strong labour unions.
The US right wing attempted a coup against FDR, and never accepted the New Deal. They felt the socialist/ reform movement should be violently suppressed. In line with that, the thinking today may stress that the militarized police forces can deal with street protests while the surveillance apparatus can assist in identifying and neutralizing leaders and movements which might threaten the laissez-faire free market model.
Andre Vltchek had a recent piece on the ultimate steady-state of a Gilded Age laissez-faire style economy:
http://www.informationclearinghouse.info/48449.htm
Posted by: jayc | Dec 20 2017 22:07 utc | 12
someone wrote:
"Taxes pay the interest the Federal reserve demands on the money it prints for the Treasury"
The Fed turns every penny it "earns" over to Treasury less expenses. There Is no interest expense to Treasury, just the cost of running a central bank service, which it could do itself.
Yes, the US Government (Treasury) pays the Fed to print paper currency (which doesn't create $, just moves already existing $ from a checking account at the Fed to a Petty Cash account) just as it pays General Dynamics et al to manufacture bombs.
We Americans are obsessive about privatization of everything, so no surprise that we outsource our central banking.
Bitcoin is a scam. State money brings many Trillions of $, Euro, Yen, etc. of production into being every year, something Bitcoin will never do. Bitcoin is a virtual shiny object that will separate a lot of financially-ignorant gamblers er, people from their money.
Have you ever used Bitcoin for an online transaction? It's as much fun as a root canal.
Posted by: paulmeli | Dec 20 2017 22:20 utc | 13
jayc @13--
"The US right wing attempted a coup against FDR, and never accepted the New Deal."
Correct. But FDR didn't do squat to prosecute any of the golpistas and several were integrated into the government to lead the war effort; Henry Wallace correctly described them as American Fascists. The only plausible reason I've arrived at for FDR's seeming ineptness is that he sympathized with their plight. Indeed, the entire myth erected around FDR needs to be dispelled since it amounts to yet another Big Lie. To understand who FDR really was, it's required to look into his actions before and during WW1; he was a disciple of Mahan; a Superimperialist disguised as an Internationalist; he began the Cold War in 1943; and laid the ground for the National Security State that would circumvent any further attempts at enforcing non-belligerence on the Outlaw US Empire through any additional Neutrality Acts.
The so-called tax cuts and attempts to kill Obamacare shine a bright light onto the philosophical outlook of the Deep State that can now be compared with the socioeconomic direction espoused for their people by Putin and Xi. Xi's and the CCP's as announced during their recent Party Congress is distilled into the concept of Win/Win. Interestingly, Putin directly echoed Xi's words--some are almost exactly the same--in his annual press conference when he answered what his primary campaign goals would be:
"Specifically, this has to do with infrastructure development, healthcare and education. This is also about high technology, as I have already said, and improving labour efficiency.
"There is no doubt that the ultimate goal of all these initiatives should be to increase household incomes in our country."
Note that the Deep State's program is exactly the opposite of Putin and Xi's plan to increase their citizenry's wellbeing.
Posted by: karlof1 | Dec 20 2017 22:48 utc | 14
Those who seek and complain for a better US governance they, they are not well informed, or don’t have any idea that this system was created to and for the benefit of an oligarchy. Only thing that can save this people and thier country is a grass rout revolution against the system. Unfortunately the minute you start complaining they will label you and shout you up as a lefty.
Posted by: Kooshy | Dec 20 2017 22:51 utc | 15
Posted by: WorldBLee | Dec 20, 2017 4:16:50 PM | 6
Nailed it
Posted by: jo6pac | Dec 20 2017 23:00 utc | 16
Trump and the GOP are destroying what's left of the public commons. Even if the russians didn't put him in office, they must be grinning from ear to ear now. Train accidents, bridges collapsing left and right, airports electrical blackouts, child poverty rates above 30% and close to third world levels, polluted drinking water in thousands of cities, southern populations with hookworm and scurvy, thousands dying from opiod overdose in states like Kentucky, etc. When the front goy and his hedge fund hyena friends are done the republic will be but an empty shell. Soon the empire won't be able to produce enough stormtroopers for it's full spectrum wars... I'm glad I left Murikkka before the coming collapse, there won't be much resources available to the underclass beside plenty of ammunitions, antidepressants and opiods to have fun. Scathing UN report on poverty in the United States. https://www.theguardian.com/world/2017/dec/15/extreme-poverty-america-un-special-monitor-report
Posted by: Augustin L | Dec 20 2017 23:11 utc | 17
Trump and the GOP are destroying what's left of the public commons. Even if the russians didn't put him in office, they must be grinning from ear to ear now. Train accidents, bridges collapsing left and right, airports electrical blackouts, child poverty rates above 30% and close to third world levels, polluted drinking water in thousands of cities, southern populations with hookworm and scurvy, thousands dying from opiod overdose in states like Kentucky, etc. When the front goy and his hedge fund hyena friends are done the republic will be but an empty shell. Soon the empire won't be able to produce enough stormtroopers for it's full spectrum wars... I'm glad I left Murikkka before the coming collapse, there won't be much resources available to the underclass beside plenty of ammunitions, antidepressants and opiods to have fun. Scathing UN report on poverty in the United States. https://www.theguardian.com/world/2017/dec/15/extreme-poverty-america-un-special-monitor-report
Posted by: Augustin L | Dec 20 2017 23:11 utc | 18
I've spent a fair amount of time with welfare recipients in many states. Overwhelmingly clear is the disincentive to stop. We hustle daily to keep our business alive, but for most current recipients, they cannot ever because then they'd lose their flow. Welfare encourages the whole poor-me cycle and cannot easily let people go.
I watched Canadian medical abuse expand for years. Now I'm watching the lowest earning 20% in the states scream for the same, regardless of cost.
I'd advocate for an annual 10% random eviction from welfare. If they're decent people with bad luck, society will support. If they're awful people who intend to steal, they can try homelessness in San Diego.
Lower taxes, cut all social services.
I'm exhausted by financing their graft.
Security cannot be found in depreciating fiat, no matter how hard these baby boomers want me to believe.
Posted by: TSP | Dec 20 2017 23:20 utc | 19
Deficit to rise $1.5T over ten years? I doubt it. Bush doubled it from $5T to $10T. Obama double that from $10T to $20T. And Team Trump once said they could have a balanced budget in 10 years. I'm thinking Trump may follow his predecessors and have doubled the debt after his term (if he's around and in place in 8 years).
I spoke to a coworker who's a Republican (and listens to Flush Rimshot - aka Rush Limbaugh) about this. I told her I was glad the election (here in AL) was over. She ignored this and said it's good the bill passed. I pointed out the deficits; she pointed to the Democrats. I reminded her it was Cheney who said deficits don't matter.
Posted by: Curtis | Dec 20 2017 23:34 utc | 20
Yep its gonna be an interesting rubber meets the road scenario when all the amerikans who have been relentlessly indoctrinated into masochistic conservatism find the ground rushing up to meet them as they fall face first into poverty.
I have no doubt the 'all assistance is parasitism' and 'income support enables low wages' types will have a bit of a rethink as tech eats further and further into formerly upper middle class jobs.
amerikans in their eagerness to to be all front, bugger the back, have long characterised the average working class family as 'middle class' - call em average and they'll more readily accept their lot is the most probable motive for that, but now the jobs that were long considered to be primo - the best of the middle class gigs, those ones that cost hundreds of thousands to learn, such as lawyers, accountants, engineers, even the formerly sacred DOCTOR are gonna be found surplus to requirements, right at the time when all available federal revenue will be fed into the maw of the machinery for imperial oppression.
The biggest hurt is gonna be on local initiatives. As I understand it, the rethug tax plan is going to double dip state taxes. Somewhere like California which has maintained a sort of neolib-lite infrastructure enabling it to offer a much reduced type of health, education and welfare program of the same basic shape as that the rest of the whitefella world offers its citizens, is gonna be hit really hard. The new tax structure severely limits the amount of deductions that can be made against state taxes that have been paid. In other words bourgeois Californians are gonna be taxed twice on any income which they have already paid more than ten grand state taxes upon.
Philosophically I find that horrific as the closer an entity is to the people it services, the better its chances of being effective, but even setting aside any syndicalist type issues, something such as this flies directly in the face of alleged republican aversion to favouring the federal government ahead of states' rights.
This promises to be an interesting conflict between nurture & nature.
Will amerikans' "better dead than red" programming cause them to quietly starve rather than resist, to kick the soup bowl outta the hands of the earnest xtian do-gooder because "we don't allow charity in this family" or some similar nonsense; or will the instinctive demand for adequate nourishment generate meaningful insurrection?
If I seem cold blooded about this it is because these choices have been equally stark everywhere else, but in most parts of the 'developed' world citizens have backed support for the strugglers long before things got to this stage. Their backing it in most cases wasn't because they were concerned they may need support for themselves, but because they didn't want to be a part of a society where any human went homeless or hungry.
Of course that has been severely tested in the last decade or so, but nowhere more so than amerika; so like I said it will be interesting to see if that stern & unsympathetic piousness of "every person for themselves" maintains when it is themself.
Posted by: Debsisdead | Dec 21 2017 0:01 utc | 21
@ 20 TSP
"I'd advocate for an annual 10% random eviction from welfare. If they're decent people with bad luck, society will support. If they're awful people who intend to steal, they can try homelessness in San Diego."
I’d advocate a 50% random jailing of investment bankers, hedge fund sharks and private equity asset strippers for “sweating the assets” to the degree that work is only slightly better paid than welfare. I’d start with Icahn, Peltz, Schwarzman/Peterson, Blankfein, one of the dudes from KKR, and Soros before I got random.
Posted by: Lochearn | Dec 21 2017 0:14 utc | 22
Karloff1 @ 15
"The only plausible reason I've arrived at for FDR's seeming ineptness is that he sympathized with their plight."
Yep. Nailed it. No elite in the US (or very nearly none) has ever been prosecuted for treason or crimes against humanity, which they engage in on a constant basis. Patriotism and self-sacrifice are only for us. Their club circles the wagons and protects itself no matter what.
Which is why Smedley Butler's claim of an elite coup went away like a puff of smoke.
Lochearn @ 23
+10
Posted by: paulmeli | Dec 21 2017 0:19 utc | 23
@13 jayc.. you might be right about that.. i don't know the history as well as an american might.. i just started reading hillburns biography on johnny cash.. it's quite a good read.. apparently cashs dad applied for some land fdr had set up for helping out farmers in the 30's in an area called dyess, arkansas - about 50 miles from memphis.. his family were some of the few lucky ones and managed to eek out a living.. as a consequence johnny cash was a firm believer in supporting the government where a government would try to help those who were willing to work towards helping themselves.. it seems like after ww2 and that, a change of attitude developed over the usa whereby it was every man for himself as opposed to the gov't being involved in assisting it's people to a better future.
@16 kooshy.. that sounds about right.. thanks for the viewpoint..
@20 tsp.. how do you feel about corporate welfare? do you give them a pass? i don't like your philosophy..
@22 debs.. bang on and my own sentiment as well..
Posted by: james | Dec 21 2017 0:23 utc | 24
@15 karlof1.. thanks for your post.. i missed that in my random reading..
@23 lochearn.. yeah - i agree with you strongly on that..
Posted by: james | Dec 21 2017 0:25 utc | 25
@ 15 karlofi1
FDR was, and still is, viciously attacked from the right and from the far left. Academics publish books in their dozens about him. They just love having a go at him, all wrapped up in ontological nuances - whatever they are. Funny how you and they don’t go after Reagan, who, rather than ushering in three decades of relative prosperity for the ordinary man and woman as FDR did, brought the bankers back to the head of the table, sacked the air traffic controllers en masse, and started dealing drugs and weapons. And that was just the entrée.
Posted by: Lochearn | Dec 21 2017 0:55 utc | 26
About outsourced lamposts: just for the heck of it, I used the fact that I still remember Polish language to compare the prices of pitchforks. Sadly, they are three times more expensive in USA, comparing Home Depot with Polish online outlets of agricultural supplies. Domestically produced stuff made of forged steel with thick sharpened prongs is pretty impressive, of course, if you want to splurge you can buy imports from Finland at roughly the same price as Home Depot. Can destitute masses fork 50 USD's per person just to scare a bunch of politicians (and police, as they are at it)?
Concerning higher or lower taxes, IMHO it is more important what is government spending than what is the revenue. I mean, is my state government increasing spending on prisons and decreasing on education, or vice versa? Back in the old country, the government is proud to match NATO minimum of 2% GDP spend on military, and actually reaching 2.25%, yea! while having perhaps the lowest percentage spent of healthcare, 6.4% vs. 6.8% in the neighboring Czech republic. USA exceeds 17% via stupendous feats of waste and abuse, and the "public part" is actually larger than the entire spending in Poland, AND the private part is larger than anywhere in the Solar System.
In any case, USA is perhaps not at the very pinnacle in wasting revenue, but they have a good chance if you restrict yourself to OECD. And among largest cities of various nations, NY subways is second, behind Mexico city, in the percentage of delayed trains, both around 1/3 of all rides. In Moscow it is one in 500 rides. Plus the size of Moscow system increases by nearly 10% every year, linking the new suburbs, and New York system is practically unchanged for 40 years (or is it 50?).
So what is most missing in USA is a vision of a country and society that works. Then people may be more willing to vote for higher taxes and be more hostile to political forces that do not want the country to be in working order.
Posted by: Piotr Berman | Dec 21 2017 0:58 utc | 27
And for those claiming the tax cuts will make their way back to the States to rebuild crumbling infrastructure and finance industry, I hope they got another thought coming. The Orange front goy and the exceptionals surronding him got played by Xi in China, they left the middle kindgom with a poisonous gift that will hasten America's demise. By lifting restrictions on foreign investments China's betting they will receiving a huge chunk of Trump's tax cuts. Maybe this was the MAGA plan of hedge fund hyenas like Barack, Icahn and Mnuchin all along when they hitched their wagon to the Make america gilded again train. You can bet hedge fund hyenas will continue to do God's work by sending most of their capital to build China... Can't fix stupid, at this point it's terminal.
https://www.washingtonpost.com/world/after-trump-visit-china-to-ease-some-foreign-investment-restrictions/2017/11/10/29f5b658-c5d7-11e7-a441-3a768c8586f1_story.html?utm_term=.28bfb08d5c03
Posted by: Augustin L | Dec 21 2017 1:24 utc | 28
Under Trump we all see that Forrest is not burning it is burnt.
May read about death of SSE under strangulation of Wall Street parasite. Financial hookworms.
https://contrarianopinion.wordpress.com/economy-update/
Posted by: Kalen | Dec 21 2017 1:26 utc | 29
Congress is being audacious. By diverting so many-borrowed- billions into the pockets of the rich it is literally making the US National Debt, reckoned in tens of trillions of dollars and constituting a mortgage on the resources and capacities of the people, in legal terms ‘odious.’
And odious debt need not be paid. It is well within the moral rights of a nation saddled with debt, incurred in its name but against its interests, to refuse to pay that debt. This is well understood in international law, and precedents have been set on numerous occasions in the past.
Can a debt, incurred to pay for “Defense” provided by contractors sponsoring Congressmen, against a phony threat, itself the result of a plot to recruit, arm and supply mercenary forces, financed by another portion of that debt, be considered to be anything other than contrary to the interests of those scheduled to repay it and to finance it, and therefore, and quite clearly odious?
Can a debt incurred to gratify lobbies such as AIPAC, which finance and intimidate Congressional voters, thus preventing them from serving the interests of the people, be considered to be in the interests of taxpayers, the victims of a regressive system of taxation, which weighs most heavily on those least able to bear its burdens, the debt which supplies Israel with billions annually in subsidies, be said to serve the interests of the working people who for generations to come will be required to finance it?
The wager being made by those ruling the United States is one familiar to us all. They understand very well that the debt is odious, and ought not to be paid by any population aware of its own interests. They understand that any future government would be perfectly at liberty to repudiate the Debt either in full or by radically re-structuring it. They know that that what they are doing is daylight robbery.
But it is their calculation that, given total surveillance of the population, given a massively armed police system (including the armed forces and mercenaries at their command) and the compliance and assistance of the media, the Academy and the intelligentsia- they are beyond the reach of democracy. That no popular movement could succeed and, if by any miscalculation it were to win an election it would never be allowed anywhere close to the levers of power.
And just to remind themselves that this is so-and that it is the fate of the people to allow themselves to be milked until the fat turns into blood- they look at the model that they have built in Honduras.
Posted by: bevin | Dec 21 2017 1:38 utc | 30
The effective tax rate for the largest corporations has been for a while in the teens and below. At least now some of the small businesses can be a bit more competitive.
The bottom line however is the tax code is this huge mass of complexity, riddled with loopholes, credits and exemptions that only those with giant resources in terms of accountants and tax attorneys can take advantage. It would be much better to simplify it all and create a level playing field for small vs large and wage earners vs the 0.1% who make most through carried interest and other types of investment income, like the recently enabled pass-thru real estate trusts breaks to get Sen. Corker's vote as it benefits him and several senators in a big way. I am intrigued by the idea of eliminating all income taxes - both for individuals and corporations and replacing it with a consumption tax and a wealth tax. There are many studies done that show they are more effective and benefit the bottom 90% more as they don't have much assets.
The core issue for federal government spending is health care costs. It already consumes more than a third of federal government expenditures and has doubled every 8 years for the past 40 years. In another two doubling periods it will become so large that it will collapse federal finances. Neither Obamacare nor any other proposal addresses healthcare costs. The US spends per capita twice what Canada, Germany, France and Sweden does and yet delivers poorer care. If healthcare costs where brought in line to what Canada & UK spends per capita that would mean a 50% cut in current expenditures. There's no political will for something like that. As it is non-discretionary spending is significantly smaller than all the entitlement programs. You can only squeeze so much there.
Maybe b or someone else who lives in Canada or Australia or Europe can explain how they can spend half what the US spends per capita and deliver better healthcare. It is not socialized medicine, since we have Medicare which is socialized medicine for seniors, yet per capita expenditures on Medicare is still twice what it is in other western countries. There is something else that is fundamentally different that causes US costs to be twice other western countries.
Posted by: ab initio | Dec 21 2017 1:43 utc | 31
One needs to give credit where credit is due. The schemers did an excellent job in the fleecing of the working class with those getting fleeced performing along the lines of a Joe the Plumber.
This is a brilliant scam and one needs to bow in respect in the face of something so preposterous. Here is why:
This so called 'Tax Reform Bill' for the 99% is nothing but a mandatory loan. For up to five years, 99%ers are given a 'tax break-loan' that will not only have to be paid back after max five years, but there will be a penalty tax increase for those who received the tax break-loan while making less than $100,000. Ten years after they received the first tax break-loan installment, they will have to pay the equivalent of a 25% tax increase from day one on.
The scheme of the future: Mandatory Loans with payday loan interest rates.
'Rude Awakening' will not cut it by light-years.
Posted by: nottheonly1 | Dec 21 2017 1:56 utc | 32
Lochearn | Dec 20, 2017 7:55:13 PM | 27
Reagan's been a recipient of poison from my pen on many an occasion. I was unfortunate enough to see/experience his governance in California before he was lied into the Presidency. Of course, DCI GHW Bush actually ran Reagan's presidency.
Posted by: karlof1 | Dec 21 2017 2:00 utc | 33
Recall what Il duce and his last mistress looked like, beaten to death, their heads reduced to skin bags of broken bone and scrambled brains, hanging upside down by wires from a telegraph pole after the Italians figured out what fascism had really brought them?
I don't think the MIC gave Trump his electoral victory because they LIKED him.
Posted by: Whyawannaknow1 | Dec 21 2017 2:13 utc | 34
Piotr Berman | Dec 20, 2017 7:58:43 PM | 28
So what is most missing in USA is a vision of a country and society that works. Then people may be more willing to vote for higher taxes and be more hostile to political forces that do not want the country to be in working order.
Good point. I think that’s becoming a general reality (decline) in a good deal of western societies. The government's directly reflect the attitudes of the wealthy and to a lesser degree the electorate.
As usual the U.S. is the leader of the pack; Detroit, Chicago, Baltimore, New York, and San Francisco.
The U.S. is a fraction of an inch from a full blown police state.
I talked to my sister yesterday (she lives in Oregon) and asked her, her impression of life in the U.S.
She basically said the infrastructure (my words) is failing fast; particularly for the elderly. My sister is 68 with a good job; but looking to retire at 70 and her major concern is housing affordability.
The tax bill just passed is the final gutting of what's left of the middle and lower middle class.
Things are relatively good here in S.E. Asia; Myanmar being the exception.
Still very affordable with very low inflation.
Posted by: V. Arnold | Dec 21 2017 2:33 utc | 35
Why should corporations pay taxes at a higher rate then their foreign competitors, and then to add insult to injury, be required to provide health insurance to their employees unlike any other country in the world?
In fact why should corporations be taxed at all, since they are providing employment (a good thing) to people who DO pay taxes? In fact many municipalities offer no-tax incentives to corporations to lure them to their communities for just that reason -- to provide employment.
There are tens of millions of corporations in the US employing many millions of people, with small corporations employing more than half the workforce. They need a break, and the boost they are being given here will contribute to higher employment which should be a major goal, not paying taxes.
Posted by: Don Bacon | Dec 21 2017 3:46 utc | 36
Don Bacon | Dec 20, 2017 10:46:12 PM | 37
That's ridiculous; trickle down is a fraud.
You're proposing a neo-liberal wet dream.
Posted by: V. Arnold | Dec 21 2017 3:59 utc | 37
"In fact why should corporations be taxed at all, since they are providing employment (a good thing) to people who DO pay taxes?" Don Bacon | Dec 20, 2017 10:46:12 PM | 37
I think that a convincing justification is that the company owners can park profits in company accounts and thus defer the taxes until the time when they will spend those profits. Compare with the situation when they pay the tax whether it is booked as a retained profit, or if it is paid to the owner as a dividend or interest, this amounts to interest free loan, while the government has to pay interest on its loans. Secondly, this deferring may have a form of not paying taxes on some profit ever, contradicting a reasonable principle that the size of taxes should be related to the ability to pay them.
Posted by: Piotr Berman | Dec 21 2017 4:17 utc | 38
Allow me to add a few facts for discussion:
National Debt by Presidential Administrations (in trillions of dollars)
President Start Years End Change
Reagan $1 $8 $2.9 +190% (nearly tripled)
Bush I $2.9 4 4.4 +50% (half again)
Clinton $4.4 8 5.8 +30% (less than 1/3 added)
Bush II $5.8 8 12 +108% (a little more than doubled)
Obama $12 4 18 +50% (1/3 added)
http://www.treasurydirect.gov/govt/reports/pd/histdebt/histdebt.htm
The Fourteenth Amendment, which granted full citizenship to former slaves also has this inserted:
”[t]he validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”
So, we cannot just kiss off the debt without a new Constitutional Amendment. A while back, some economists were suggesting that since the Constitution still grants Congress the SOLE authority to mint and value our currency, we could mint a bunch of Billion Dollar coins and pay off the debt for a few hundred bucks.
But of course, a sizable portion of our national debt is owed to USAmericans/institutions. 55.9% as of last year.
For instance, the Social Security System collects far more than it spends, so it buys bonds, which means US Debt... $2.8 trillion at last count. That’s almost as much as we owe to the (privately owned) Federal Reserve System at $2.5 trillion.
And $6 trillion is owed to foreign investors. We wouldn’t be doing our international prestige much good if we just kissed them off. Though, our international prestige is obviously not a National Priority ;-)
https://www.thebalance.com/who-owns-the-u-s-national-debt-3306124
Posted by: Daniel | Dec 21 2017 4:28 utc | 39
Here's a link to TRNN and Bill Black on the new tax bill;
http://therealnews.com/t2/story:20764:Trump%2C-GOP-Pull-Off-Their-Tax-Heist
Lies and more lies and outright fraud.
Posted by: V. Arnold | Dec 21 2017 4:33 utc | 40
Expanded Medicare For All will save the average USian over $4,000 per year compared to what we currently pay, even after factoring in any tax increased to fund it.
AND, it would add ZERO dollars to the National Debt since it's fully funded up front. In fact, it would save the government money compared to what it currently spends since it is less expensive than what government currently buys.
Hence, this will meet the fiscal conservative demands, AND achieve the progressive goal of healthcare being a basic human right. The ultimate "bipartisan" issue!
Remember when the VERY conservative Tax Policy Center generated the BS report on the Bernie Sanders Expanded Medicare For All policy that claimed it would cost the US $18 Trillion?
That was the figure that Chelsea Clinton, HRC and the her PR team in the Corporate Media cited.
Well, after real economists tore TPC a new one for their fraudulent "study," they went back over their calculations and corrected it.
"TPC found that the average tax burden would increase by about $9,000 in 2017 but the average amount of benefits would increase by more than $13,000. As a result, households would on average receive a net income gain of almost $4,300 under Sanders’s proposals, TPC said.
"Households in the bottom fifth of income would on average receive a net gain of more than $10,000, and those in the middle fifth of income would have an average gain of about $8,500."
But of course, some would pay more. "Those in the top 5 percent of income would see a net loss of about $111,000." (and almost all of that is really the top 1%, but TPC wants its readers to feel they are an oppressed minority).
So, whenever you hear someone ask "where will the money to pay for universal healthcare come from?," the appropriate response is "what will you do with the thousands of dollars you will save?"
http://thehill.com/policy/finance/279201-study-most-would-see-net-benefits-from-sanderss-proposals
Oh, and of course Tax Policy Center got major funding from the insurance and pharmaceutical industries (as did HRC and both Party Flavors in Congress), which is why the generated their initial bogus claim:
Posted by: Daniel | Dec 21 2017 4:34 utc | 41
BTW: the US does have a "socialized medicine" program. That would be the VA, which owns the facilities and employs all the healthcare staff. And despite the negative publicity about serious problems mostly caused by underfunding, it's the second most popular healthcare system in the US ranked by its users.
The most popular? Why, Medicare of course.
Medicare is not "socialized medicine." It is a single payer system in which consumers/patients are free to hire any doctor they choose and go to any healthcare facility they choose that has agreed to participate. If we had universal Medicare For All, then pretty much every doctor and facility would participate.
Medicare already exists, so is obviously a solid base for an Expanded Medicare For All System. But Kaiser Permanente has been positioning itself to be another possible base. You see, Single Payer doesn't necessarily mean that payer is the government.
Oh, and Kaiser is the third highest ranked healthcare provider in the US.
Posted by: Daniel | Dec 21 2017 4:41 utc | 42
b - your stats are just more fake news. Only 50% of Americans actually pay any taxes other than SS/Medicare payroll taxes. So it is perfectly true to say that the top 50% of taxpayers get 100% of the benefits. Is that fair?
Everything you wrote is based on such illogic, and anyone familiar with 4th grade math will understand that when presented with details. But it appears that you base your arguments off of MSM headlines, who are famous for twisting the truth so far as to be unrecognizable when compared with reality.
It's also unfortunate that you seem to truly believe in Marx's famous creed - "From each according to his ability, to each according to his needs" - which will eventually lead to poverty for all.
Posted by: DonFromWyoming | Dec 21 2017 4:42 utc | 43
@ Piotr Berman #39
I think that a convincing justification is that the company owners can park profits in company accounts and thus defer the taxes until the time when they will spend those profits.
CEOs are rewarded for expanding company business, not sitting on current levels. That's any size business, and most business in the US is small, hoping to become big.
Posted by: Don Bacon | Dec 21 2017 4:51 utc | 44
@ V. Arnold
"Trickle down is a fraud."
I didn't say trickle down, that's you.
I said: Corporations need a break, and the boost they are being given here will contribute to higher employment which should be a major goal, not paying taxes.
Posted by: Don Bacon | Dec 21 2017 4:55 utc | 45
Don Bacon | Dec 20, 2017 11:55:24 PM | 46
Different words, same results.
Reagan 2.0
Posted by: V. Arnold | Dec 21 2017 5:00 utc | 46
@46
Watch the video I linked; Bill Black is an expert in the law and has sent many bankers to jail; well worth a listen.
Posted by: V. Arnold | Dec 21 2017 5:05 utc | 47
V. Arnold @38
No. You're the one being ridiculous as it doesn't fit your ideological conception. So name calling is all you can resort to. It is nonsense that lowering corporate taxes on small business is neo-liberal.
Don Bacon @37 is spot on. Half the employment in the US is provided by small business. That's the person with a carpet cleaning business, or a plumbing or a general contractor business. That's the person who has a medical waste disposal business or an auto body shop. These are companies below $200 million in annual revenues. They are at an unfair competitive disadvantage as the tax code favors large corporations who can hire armies of tax attorneys and accountants and pay an effective rate in the teens. The regulatory burden on small business is huge because they don't have the extra resources to fritter away on massive compliance costs.
Neo-liberal has many definitions. In any case when government intervenes to support the few they have an unfair competitive advantage. There are over 6,000 commercial banks in the US. But only a handful - the big money center banks are TBTF. They have a government enabled back stop and blank check. The thousands of other banks don't. If they screw up they go belly up. They don't get bailed out by Uncle Sam.
If you want to level the playing field. Then for a start enforce Robinson-Patman. Have a flat corporate tax with no exemptions, credits and deductions or even better no corporate tax. Favor domestic production over imports as the Chinese do in government contracts. And have the government focus on what it should do like building good infrastructure and stop meddling in the ebb & flow of competitive enterprise. Bailing out Wall Street with taxpayer money only means bad actions get rewarded, which will naturally lead to even worse actions by these behemoths.
Posted by: ab initio | Dec 21 2017 5:05 utc | 48
Daniel @43
All well and good. But why does the US health care service cost twice per capita as Germany's or Canada's? So what if you had Medicare for all and it costs double what other western countries pay per person. Unless you believe that Medicare for All will cut current health care expenditures in half. How does that happen?
Posted by: ab initio | Dec 21 2017 5:13 utc | 49
It feels hard to wade into the middle of this posting and comments.....all of which are insightful....one at a time
To b I want to say that the title of your posting in my mind should say that the prelude is to US default instead of higher taxes.
The UN vote on Thursday will draw the lines and national investment, you would think, will follow. There are options now that didn't exist before in relation to international transaction clearing mechanisms and alternative places to store your national excess foreign currency reserves instead of US Treasuries.
What is a trickle now of alternative financial dealing may turn into a river soon.
And when the buying of US Treasuries stops, so does the funding for more war to prop up private finance running our world...unless it is the last before sticks and stones again eons from now.
Posted by: psychohistorian | Dec 21 2017 5:37 utc | 50
@ ab initio with a number of questions and, IMO, misperceptions about how the world works
Why is American health care so expensive? It isn't health care to begin with. It is a contrived big business model (as you talk about with unfair competition with smaller vendors) that is designed to make money first and foremost, followed by maintaining control of if/how/where "health care" evolves and lastly by providing profitable health care services at the least cost.
And that is before you discuss the impact of the insurance industry and its profit model.
Do you see a pattern here yet? It is all about profit/money and insuring ongoing control of the model that optimizes those values. I call fealty to the God of Mammon.
ab inition wrote
"
The regulatory burden on small business is huge because they don't have the extra resources to fritter away on massive compliance costs.
"
I want to suggest that regulation of business is a very desired part of any government we might want that is public oriented. That said, The current regulatory structure and content is developed by and for the abuse of the big companies again.....and for profit.
I posit we eliminate the anti-social incentives that having private finance brings to our social structure and try having finance be a public utility with control by sovereign governments that supposedly are accountable to the public they represent.
Posted by: psychohistorian | Dec 21 2017 5:55 utc | 51
psychohistorian | Dec 21, 2017 12:55:12 AM | 52
You're a braver man than I Gunga Din.
ab's reading comprehension sucks; I won't waste the electrons to answer.
Cheers PH
Posted by: V. Arnold | Dec 21 2017 6:03 utc | 52
psychohistorian @52
You know that most of current regulation of business is filing zillions of forms and paying all kinds of fees. And new forms after the most recent catastrophe and media outcry. Just like take off your shoes after a shoe bomber gets on a plane. Like a real terrorist is gonna do that again.
Finance as a public utility. Yes in some utopian world where the omniscient bossman in government knows just the right entrepreneur to finance and just the right "public works" program to fund. The reality that we see today is the revolving door. The fox in charge of the regulatory henhouse. But that's not a problem that even more governmental power and regulation cannot fix! Even better for the oligarchic foxes.
Posted by: ab initio | Dec 21 2017 6:10 utc | 53
@ ab initio again because my into was too harsh.
While I agree the the big TBTF banks are causing the biggest crimes against humanity, I believe that private banking is a license to steal from the public at large and the usury is immoral.
Usury is viewed by some as the measurement of risk related to a potential investment. Risk in this case, within only the context of usury, is measured as failing or succeeding in monetary terms. It seems a very superficial measure of success and failure especially in the context of the investment being an educational program or other "Commons" related activity.
It is way past time to put the tools of finance in the public Commons, IMO
Posted by: psychohistorian | Dec 21 2017 6:14 utc | 54
Instead of becoming a left wing blog that denies the deleterious effect on the individual to have to accomodate a government and thus not date and marry as advantageously as otherwise (and denies the sucking sound of US capital finally wanting to go home (imagine that), why isn't b discussing how Q implies Soros and Bin Talal are both under arrest at Camp David now?
Sure, it may be a big hoax, but if it's true you're missing out on the story of the century. There's good reason to believe Bin Talal is now a prisoner of the US military. He was and is best friends with the Bushes and Clintons. That's discussion worthy.
Posted by: B Logical | Dec 21 2017 6:17 utc | 55
@ ab initio who wrote
"
Finance as a public utility. Yes in some utopian world where the omniscient bossman in government knows just the right entrepreneur to finance and just the right "public works" program to fund.
"
The reality is that today you do not have a clue who is deciding which entrepreneur to finance and which public or private program to fund. Sorry, but we have had a couple of centuries of plutocrats that own finance AND governments....so its their hen house.
It is time for another way that is utopian in your mind only
Posted by: psychohistorian | Dec 21 2017 6:20 utc | 56
Fueled by drug crisis, U.S. life expectancy declines for a second straight year
American life expectancy at birth declined for the second consecutive year in 2016, fueled by a staggering 21 percent rise in the death rate from drug overdoses, the Centers for Disease Control and Prevention reported Thursday.The United States has not seen two years of declining life expectancy since 1962 and 1963, when influenza caused an inordinate number of deaths. In 1993, there was a one-year drop during the worst of the AIDS epidemic.
b | Dec 21, 2017 2:56:34 AM | 58
That is a tragedy, albeit, not surprising.
It's an open secret the U.S. is in decline across the board.
The only thing I worry is my family living in the states; so far so good; but breakers ahead on a lee shore...
Posted by: V. Arnold | Dec 21 2017 8:13 utc | 58
To reduce concern to the confines of the family is understandable but offers a grossly narrow perspective.
Posted by: Quentin | Dec 21 2017 8:21 utc | 59
@ B Logical | Dec 21, 2017 1:17:28 AM | 56
Q who? Did you check what in particular of the many claims of this event came true? Until now? May give a hint to how serious one should take this potential hoax, no?
Posted by: Hausmeister | Dec 21 2017 8:24 utc | 60
Quentin | Dec 21, 2017 3:21:21 AM | 60
In the end, what else is there, besides family; both stateside, and here in my adopted country?
Posted by: V. Arnold | Dec 21 2017 8:47 utc | 61
psychohistorian 52
The drug companies falsifying Linus Pauling's health findings on vitamin C , says it all - really .
How many trillions would they have lost if Pauling's work had been fairly appraised and how much ill health ( and cancer ) would have been ameliorated . QUI BONO ?
Posted by: ashley albanese | Dec 21 2017 10:47 utc | 62
There are commenters here who seem confused about the interests of large corporations (such as, say, News Corporation, Disney, Sony, Lockheed Martin, Boeing) that have grown to the size they are through mergers, takeovers, colluding with competitors to stop other companies from entering their industry and threatening their profit levels or lobbying governments to subsidise them (or bail them out as the case may be), and the interests of small companies, often owned and managed by the same person or small group of persons who more often than not are preyed upon, chased out or gobbled up by the bigger companies that then turn them into tax shelters so that the predators may minimise their tax obligations.
I would give the little guys tax breaks and provide advice up to the level where they are viable profit earners on their own but no more. (Though problem is determining that level where they become viable - even very large car manufacturers like GM, Ford and Toyota still rely on government subsidies running into the hundreds of millions in many countries where they have factories. And most governments are happy to supply such subsidies because hosting major car manufacturers is seen to be prestigious, a sign you've become part of the developed world.) However large corporations that have grown fat on hoovering up smaller companies in their industry, turning them into tax shelters or parking their profits into offshore funds through transfer pricing arrangements, while at the same time pressuring governments to lower corporate tax rates and erode social security, are the ones that should be paying the taxes they already owe, let alone pay more tax.
And let's not forget that it is government regulation, the rule of law and in particular the law of contract that provide the framework in which so-called free markets can operate.
Sorry if I'm starting to sound Abraham-Lincoln-like - something just got a-hold of me while I was reading the various comments here.
Posted by: Jen | Dec 21 2017 10:55 utc | 63
B @ 58, V Arnold @ 59:
That US life expectancy is in decline is tragic indeed - and yet that Washington Post article is deliberately missing something.
It notes that the greatest drug mortality is among people aged 25 - 54 years, that men are twice as likely to die from drug overdoses as women across all age groups, and that West Virginia, then Hampshire and Ohio are the states with the highest levels of drug-overdose deaths per 100,000 people. If we take these statistics along with others not mentioned, might we not see that what is fuelling the rise in opioid (ie, painkiller) related deaths is class warfare of the super-rich 1% against the 99% poor and the New Poor (the former US middle class)?
Posted by: Jen | Dec 21 2017 11:10 utc | 64
B @58
Wasn't the drop in Soviet life expectancy one of the signs of its future demise? I seem to remember that's how Emmanuel Todd got it - increased infant mortality, high suicide rates and the like.
Posted by: Clueless Joe | Dec 21 2017 11:13 utc | 65
ashley albanese | Dec 21, 2017 5:47:23 AM | 63
The drug companies falsifying Linus Pauling's health findings on vitamin C , says it all - really.
Wow, blow me away; Linus Pauling's vita-c studies were hugely important.
I lived in Oregon and am well familiar with his studies, which were spot on!
Vitamin C is an extremely important adjunct to one's life.
Thanks so much for that post.
Posted by: V. Arnold | Dec 21 2017 11:14 utc | 66
Jen | Dec 21, 2017 6:10:59 AM | 65
With out a doubt! Hear, hear!
Posted by: V. Arnold | Dec 21 2017 11:17 utc | 67
Lest it should pass unacknowledged; today is the Winter Solstice; cheers to the event and all who post here...
Posted by: V. Arnold | Dec 21 2017 13:08 utc | 68
@69
One of the "holidaze" I like.
Happy Solstice!!!111
Posted by: Forest | Dec 21 2017 13:23 utc | 69
Forest | Dec 21, 2017 8:23:37 AM | 70
Kudos to you kindred soul...
Posted by: V. Arnold | Dec 21 2017 13:29 utc | 70
Daniel @40 Makes note that the $2.8 trillion taken from social security was used to buy 'bonds'. This seems to indicate all social security administration has to do is sell some bonds when the short fall comes. When the Reagan regime set out to use social security funds to offset their deficit, they issued (till this day) special federal notes that gamblers call (IOUs). The republican plan to destroy social security is about dead beating the SS IOUs to keep from raising taxes on fat cats. Social Security is not broke .... America is BROKE!
So when the issue is giving tax cuts to billionaires, wasting trillions on endless pointless winless wars, or spending trillions bailing out the big banks, well, 'supply side economics' and deficits don't matter.
Oh, but now we just HAVE to cut social security and medicare for the middle class, and raise taxes on the poor and the middle class (maybe a nice VAT national sales tax on the production and consumption of useful products and services, right), because you see, suddenly deficits matter.
Posted by: TG | Dec 21 2017 13:58 utc | 72
The rich will always blame the poor for being poor. Sick system all around. This talk about how much or little of their crummy petrodollars they will claw back from you to blow people up worldwide will continue it's current bloody course so long as the private Federal Reserve manipulates and controls monetary policy. I'll be a happy camper the day a plurality of Americans can realize that and take collective action to end it once and for all.
Posted by: str8arrow62 | Dec 21 2017 14:21 utc | 74
EVery so often, some news analysts will briefly mention that St. Ronnie's large 1981 tax cuts, which were supposed to trickle down to the middle and lower income demographics and magically there would be huge revenues coming into the US Treasury, did not work as touted. And St. Ronnie instead ended up demanding high tax increases, in 1982, iirc.
But analysts should be tying these Trump tax cuts to what happened under St. Ronnie EVERY TIME THEY"RE DISCUSSED.
Perhaps Trump and Republicans moved a little too soon to pass the Magical Thinking Tax Cut bill, as there seems to be widespread public skepticism about how well it will work out, especially for those not in the One Percent of wealth holders. If analysts actually made a point of mentioning the St. Ronnie tax debacle every time Trump's debacle is discussed, there would only be one percent approval for these cuts.
And, as they're been doing since FDR proposed SocSec, the Repubs and some stupid Corporatist Dems will now begin the drum beats for austerity and cuts or destruction of SocSec, Medicare, beginning with ruining Medicaid.
Bernie, stay healthy, please!!! Keep building the infrastructure for supporting Medicare for All Improved and win the 2020 presidential election.
Posted by: jawbone | Dec 21 2017 14:49 utc | 76
Trying to reform the Federal government is like trying to revive a decaying corpse.
Posted by: Perimetr | Dec 21 2017 14:55 utc | 77
Corporations derive their profits from having a healthy well educated public not just to consume their products, but also to manufacture, transport, warehouse & distribute products and services.
It is the corporations who make the most use of public transport infrastructure such as roads bridges etc & it is certainly corporate heavy transport which is the chief cause of degrading that infrastructure requiring expensive cyclical maintenance. This is why corporations should pay taxes, they get a private benefit from use of public assets.
There is absolutely no rationale for giving the corporations a free ride, especially given the disgusting way that business (and in this small to medium business is probably more culpable than the crooked mega-corps) regard citizens. They poison, destroy, endanger with unsafe practises and chisel. The only way that is kept a little at bay is through public funded enforcement. To suggest that corporations are goodfellas who contribute and don't steal, murder and maim is delusional.
Posted by: Debsisdead | Dec 21 2017 15:44 utc | 78
V. Arnold @ 62
What a shame that you can't look outside the family bubble.
Posted by: Quentin | Dec 21 2017 16:08 utc | 79
Re the assertion that low wage earners pay no Fed income taxes is a load of BS. If you work at all you pay close to what Buffet pays as a percentage. Payroll taxes alone count for about 6% of income and if you include the employer's share as coming off of your bottom line, that climbs to over 10%. Last time I crunched the numbers a flat tax of about 13 - 14% on ALL declared income would fully fund even the current bloated budget - no deficit. Even with deductibles I pay over 13% and I'm nowhere near the top brackets. So who doesn't pay taxes on all of their declared earnings? the very poor are only part of it...The US tax code needs an overhaul but also needs to start with some honest numbers and count all income the same.
Of course the GOP and ilk always like to include payroll funded programs in with total Fed spending, but than fail to include these payments as part of the individual's tax contributions. Makes it look like Soc spending is out of whack with receipts and defense spending is smaller % than it really is. Eliminate these programs and keep the payroll taxes in place?! I'll see ya on the barricades.
Of Fed spending, what do working poor actually use? Public schools, roads, and when they get old SS and medicare. They pay taxes toward SS and Medicare, pay taxes toward highway upkeep, pay local sales and property taxes (even if they rent) used to fund fire dept and local roadways. Then consider a portion of their SS gets spent by the Govt in the general fund and replaced with worthless non-tradable securities in the SS Trust fund, they wind up sending some to State Dept, military, courts, Intel agencies, research grants, aid to foreign countries, etc - in short a whole bunch of programs they never use or benefit from aside from possibly a stint in the military that is just as liable to get them killed or cost them their mental health.
When the top .1% own 90% (and increasing) of the country's wealth but only pay 50% (and dropping) of the taxes it doesn't look very unfair in that direction.
Posted by: Miller | Dec 21 2017 16:14 utc | 80
1. Tax cuts and growth
Here is a chart of federal tax receipts going back to 1940, personally, I like using inflation adjusted or current dollars, 'percent GDP' is a dog chasing its tail.
There was good revenue growth in the 1980/90's, Clinton moderately increased taxes, GWB moderately cut taxes, and Obama left most of GWB's tax cuts in place.
The 1950's was a fairly flat decade, if others see different things, that's fine.
(BTW I am a Republican but I do NOT worship at the altar of tax cuts, I believe God will punish us for Yemen, I worship the God of justice.)
2. Impact of national debt: Japan or Tsunamis?
The $1.5T is on top of the projected $9T guesstimate. It looks like the Federal reserve can keep interest rates artificially low forever. So maybe we will become like Japan, low interest rates with very little growth or low interest rates with vicious boom / bust cycles. We must have low interest rates, otherwise our annual debt service will become $1T or $2T.
Posted by: Christian Chuba | Dec 21 2017 16:19 utc | 81
@Debs #79
Corporations pay their share of highway costs via fuel taxes, that's the way it works.
Regarding "There is absolutely no rationale for giving the corporations a free ride" there absolutely is a rationale, and that is offering employment to people who then support society via taxation. Poor people don't provide employment, corporations do, and small corporations in our communities provide half the national employment. Trump has put jobs ahead of taxes, which is a good thing.
Should corporate behavior be regulated? Absolutely, but that's a different subject.
Posted by: Don Bacon | Dec 21 2017 16:22 utc | 82
@83 It's not only corporations providing employment. The government provides a lot of employment too. Some of it is useful some less so.
"Over 1,400,000 Americans are now on active duty; another 833,000 are in the reserves, many full time. Another 1,600,000 Americans work in companies that supply the military with everything from weapons to utensils. (I’m not even including all the foreign contractors employing non-US citizens.)"
Posted by: dh | Dec 21 2017 17:04 utc | 83
@Don Bacon #83
Small business employ far more than the big corporations, and only about 20% of small businesses are incorporated.
The drop in pass through pay might help some of them, and the corporate rate is a lot different for different corporations depending on whether most of their operations are domestic or foreign. The code could take that into account and favorably lower taxes for corporations that have more of their manufacturing and supply chain in the US, in fact the opposite is true and I'll wager even this tax "reform" fails to address that dynamic.
Bottom line corporations should pay the same as the individual rate with strict limits/definitions on what can be claimed and what expenses can be declared as not part of their profit. Don't like it? Change your ownership structure to something with a lot more personal liability and pocket more of the $.
Ultimately if elections were publicly funded a great deal of the divisiveness and inequality would disappear from the tax code. There would still be poor and wealthy, but the inequality in government representation would shrink.
For everyone who thinks the country is going down the toilet, how much $ did you contribute to ANY of your elected officials or their opponents? The country has never been running better or better run that right now.
Posted by: Miller | Dec 21 2017 17:11 utc | 84
@ 85
Suck a cock asshole.;..
How much blood and money have you given?
@ 84
Welfare right?
Posted by: Forest | Dec 21 2017 17:24 utc | 85
"Reagan tax increase" is complete horse shite.
Congress increases taxes. Reagan neither proposed or favored that tax increase.
Your statement is false.
Posted by: John | Dec 21 2017 17:29 utc | 86
CEOs are rewarded for expanding company business, not sitting on current levels. That's any size business, and most business in the US is small, hoping to become big.
Posted by: Don Bacon | Dec 20, 2017 11:51:27 PM | 45
Where is this nugget of wisdom coming from? Do you read business pages? They are perhaps least propagandistic sections in major newspapers etc.
1. CEO can manipulate board membership and the "formula" used to reward them. Than the raiders and shorts complain and so on.
2. If a company has large earning, "parking them" is a frequent strategy, and the case of Apple was widely discussed. However, small/medium businesses are also describe as exploiting different rates used for personal and corporate income, getting personal income classified as salary, capital gains or interest and so on.
3. If CEOs are interested primarily in increasing the company size, or market share etc., why they ever consider buy-backs of common shares? Or down-sizing? There are many types of business strategies.
"Poor people don't provide employment, corporations do..."
That really asks for so-called Pigovian taxes: taxes that "penalize bad behavior", like smoking, drinking and gambling. If you look at crime, health, creating jobs etc., being poor is a bad behavior and it should be taxed appropriately, e.g. by increasing the indirect taxes that the poor cannot avoid, or structuring fines and tickets in a way that is particularly painful for the poor and so on. Those strategies are widely used in USA, but judging on the numbers of the poor, there is still more to do. Just abolish taxes on corporate income, capital gains, inheritance, interest and replace with federal sales tax.
Posted by: Piotr Berman | Dec 21 2017 17:35 utc | 87
The days are going to be longer,thank you.(win.sto.)Trump still believes the zionists will stay his ship.God damn.
Posted by: dahoit | Dec 21 2017 17:45 utc | 88
@Forest #86,
pound sand, asswipe.
The closest I'll be getting to that is walking past the entrance to Abercrombie and Fitch.
I don't contribute anything anymore - gave the Greens some $ about 20 years ago last time. My local politicos aren't going to support Democracy if they don't have to, they can get their operating and retirement $ plenty from deeper pockets than mine. For the record I am no fan of the status quo, but I have no illusions about the why of it, who my enemies are, or what it will take to fix it.
Posted by: Miller | Dec 21 2017 17:52 utc | 90
ot - does anyone have nikki haleys list of the naughty 128 that voted against her and trumps threats? i am kinda curious to see what my dumb fuck leaders here in canada did or didn't do.. thanks..
Posted by: james | Dec 21 2017 17:54 utc | 91
@92 Yes it will be interesting to see the list. I expect to see Canada and the UK just behind Iran and North Korea. :)
Posted by: dh | Dec 21 2017 17:58 utc | 92
@92 James here are the countries that voted with the US...I'm guessing Canada abstained.
Guatemala
Honduras
Israel
Marshall Islands
Micronesia
Nauru
Palau
Togo
Posted by: dh | Dec 21 2017 18:13 utc | 94
james @92--
Canada abstained. Vote board at top of this item. By my back of envelope calculation, nations representing about 90% of global population voted against Trump's attempt to sow more chaos and provide political protection to the Zionist Abomination.
Posted by: karlof1 | Dec 21 2017 18:14 utc | 95
Tax bill and "big fight" between the two corporate political parties in the USA over said bill coincides with the announcement of officially entering the war in Yemen. Coincidence?
Posted by: joe defiant | Dec 21 2017 18:19 utc | 96
Niki Haley thinks the US was singled out
:-))
What is next - the UN moving from New York?
Posted by: somebody | Dec 21 2017 18:22 utc | 97
Re: 92
https://www.ynetnews.com/articles/0,7340,L-5060274,00.html
The nice: USA, Israel, the best of Central America: Guatemala, Honduras, the pearls of the Pacific: Marshall Islands, Micronesia, Palau, and the true triumph of our diplomacy: Togo.
I am sorry to say, but this time Tuvalu abstained, perhaps they overspend on influencing US elections while imitating Russian trolls and now they cannot afford a representative in NYC. However, it seems that they were present but abstained, like Kiribati, Vanuatu, Fiji etc., including Poland, Hungary and Canada. Is it enough to rename Canada as New Trumpland, or not?
Posted by: Piotr Berman | Dec 21 2017 18:27 utc | 98
Forest @ 90
Nope. Days are getting shorter over here. There must be something wrong! UFOs?
:-)
Posted by: E | Dec 21 2017 18:33 utc | 99
The comments to this entry are closed.
When "Tax Cuts" are less popular than previous Tax Increases - as several polls have shown - it's once again clear that our plutocracy does as it wishes, regardless of the will of the citizens.
Meanwhile, the Expanded Medicare For All that is favored by 88% of likely Democratic voters is also favored by a majority of Republican voters who earn the median individual income or less! And that's with all the misleading, negative coverage it's gotten over the years.
And while the tax cuts on corporations and the rich are permanent, this bill's "cuts" for people who actually work for a living will expire within several years BY DESIGN! And Ryan is already discussing cuts in "Entitlement" programs (which again are widely popular) to mitigate the increase in National Debt that he knows these tax cuts will produce.
Posted by: Daniel | Dec 20 2017 20:37 utc | 1