President's Debt Commission are once again part of the President's Deficit Reduction plan. But more on that in a minute...
I think what's gotten so many Republicans in an uproar is this from the President's Deficit Reduction plan:
It's that part in bold that's the kicker - "explain why somebody who's making $50 million a year in the financial markets..." - in other words investors. It's not the marginal tax rate that the President is proposing to increase...atleast not immediately. It's the capital gains tax on investment income that's in question. Now, why is this important? Paraphrasing from the book, "Bad Money," by Kevin Phillips:Middle-class families shouldn’t pay higher taxes than millionaires and billionaires. That’s pretty straightforward. It’s hard to argue against that. Warren Buffett’s secretary shouldn’t pay a higher tax rate than Warren Buffett. There is no justification for it.
It is wrong that in the United States of America, a teacher or a nurse or a construction worker who earns $50,000 should pay higher tax rates than somebody pulling in $50 million. Anybody who says we can’t change the tax code to correct that, anyone who has signed some pledge to protect every single tax loophole so long as they live, they should be called out. They should have to defend that unfairness -- explain why somebody who's making $50 million a year in the financial markets should be paying 15 percent on their taxes, when a teacher making $50,000 a year is paying more than that -- paying a higher rate.
It wasn't that CEOs and hedge fund managers were making profits from producing goods in the U.S. Manufacturing as a percentage of GDP has been on the decline since 1950 (pg 31) - 29.3% in 1950 to just 12% in 2005 - whereas financial services had been on a slow uptick - 10.9%, 13.6%, 14% and 15% between 1950-1980. By 1990, financial services had surpassed manufacturing and has never looked back since. So, what has this to do with taxing the rich? Only that the wealthiest among us and only the wealthy can take advantage of tax shelters that most of us can only dream of. As such, the weathy are able to hide their taxable income thereby reducing or in some cases completely eliminating their tax liability. Yes, the wealthy still pay a higher gross percentage of federal income taxes, but those who pay income taxes via their profits from (long-term) capital gains do in some cases end up paying taxes at a lower rate than the average worker.In 1988, finance became the chosen sector of the U.S. economy. Product innovation, the ultimate paper entrepreneural opportunity, followed an economic policy that aimed to achieve growth by wealth creation. By 2007, the results in terms of wealth and profits were staggering. Financial services became Wall Street's new profits machine.
So, getting back to the Debt Commission's proposals (which fell only 3 votes shy of the required 14 votes of 18 votes needed before the recommendations could be submitted to Congress for debate), although their recommendations didn't specifically mention changing the capital gains tax, the Commission did recommend changing the tax code, specifically: capping taxes at 21% of GDP, eliminating the Alternative Minimum Tax and raising the earnings subject to the payroll tax to $190,000 in 2020. It is worth noting that none of the changes to the tax code except for temporarily lowering the payroll tax to 3.1% and possibly changes to the capital gains tax would go into effect until January 1, 2013 at the earliest.
Last edited by Objective Voice; 09-20-11 at 05:30 PM.
I don't want to see religious bigotry in any form. It would disturb me if there was wedding between the religious fundamentalists and political right. The hard right has no interest in religion except to manipulate it. ~ Billy Graham in Parade magazine February 1, 1981.
#2 won't cost any jobs ($300/employee is a minimal expense) and will prevent fraud that can kill people. Lead is highly toxic
If those are the best you can come up with, it looks like the rightwing is just whining again about hobgoblins
Most people are of average intelligence.
Except people on the internet. The typical internet user has an IQ of 147 and a 9 inch penis. Present company included.
I may be wrong.