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Thread: US Debt Could Double in 25 Years With Current Policies

  1. #151
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    ttwtt78640's Avatar
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    Re: US Debt Could Double in 25 Years With Current Policies

    Quote Originally Posted by iguanaman View Post
    I like this plan to cut our debt in half this year.


    How the US Nation Debt could be paid-off NOW

    Those people would never miss that 15%. Since we have been so nice as to allow their net worth to increase by 5 times since 1985 with our ever lowering tax rates, don't you think they could help old uncle sam out of this pickle?
    I'm tired of people ranting about how the rich CAN'T bail us out if we needed them too. It's a lie
    I don't want them to but they could pay off our debt tommorow and not change one thing in their life. Where do you think alot of that money we owe was spent?
    The right way out of the debt problem is growth, nothing shrinks our debt faster than rising GDP's We certainly can't do what the Europeans did and make severe cuts.
    Well golly Gomer, if the 90% "non-rich" majority can simply force the 10% "rich" minority to pay not only higher tax rates on income, but to tap into their "fair share" of the "rich's" accumulated wealth, then the "non-rich" NEVER have to pay any more taxes at all! What a wonderful idea! Just turn IRS into a very well armed Robinhood force, take it ALL from those anonymous "rich guys" and auction all but one mansion, a single limo and a modest stock portfolio and the "non-rich" would be set up to have untold gov't benefits bestowed upon them for life. USA, USA, USA...
    Last edited by ttwtt78640; 06-11-12 at 10:16 AM.
    “The reasonable man adapts himself to the world: the unreasonable one persists to adapt the world to himself.
    Therefore all progress depends on the unreasonable man.” ― George Bernard Shaw, Man and Superman

  2. #152
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    Re: US Debt Could Double in 25 Years With Current Policies

    Quote Originally Posted by iguanaman View Post
    Those people would never miss that 15%. Since we have been so nice as to allow their net worth to increase by 5 times since 1985 with our ever lowering tax rates, don't you think they could help old uncle sam out of this pickle?
    Although I believe a tax revenue component will be necessary to help the nation address its long-term fiscal challenges, I believe the nation would be taking a dangerous path in deciding to shift taxation from income or consumption to accumulated assets or wealth. Whether or not the targets of this wealth tax could "afford" it is an entirely different issue.

    The precedent that would be established would be damaging. The precedent would signal that published U.S. tax rates are not credible. In other words, if one paid one's taxes according to the law, that would no longer mean that one would face no additional tax liability for that tax year. Instead, one could be subjected to additional tax liability on a retroactive basis. A wealth or accumulated assets tax is a retroactive tax on past income (the after-tax share).

    Suddenly, there would be much greater uncertainty about the U.S. tax code. The message would be that U.S. taxes are higher than what the law suggests. Worse, both the true tax rate and the timing of the tax would be unknown. That degree of uncertainty would, in the long-run, have an adverse impact on savings and investment. The nation's better short-term position (reduced debt) would amount to a Pyrrhic victory.

    The long-term cost of foregone growth would be higher. A hollowing of the nation's capital base could reduce the innovation and productivity that are key to long-term robust growth. Even after 30 years, the nation's GDP could be nearly 15% smaller than it would otherwise be were a 0.5% shaved off the growth rate. A smaller economy would mean less tax revenue than would otherwise be the case.

    That those who advocated such a tax would assert that it was "one-time" would matter little. The precedent would exist that in the face of future fiscal challenges, the nation could resort to another "one-time" tax.

    In the end, I don't believe a wealth tax should be a substitute for the structural reforms (tax changes, discretionary spending reforms, and mandatory spending reforms) that will be needed to put the nation on a fiscally sustainable course for the long-term.
    Last edited by donsutherland1; 06-11-12 at 10:52 AM.

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