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How would the Buffett Rule Help?

Posted by nikoleta (My Page) on
Thu, Mar 22, 12 at 11:16

Liberals insist we have a REVENUE problem and propose the "Buffet Rule" to raise more revenue. Conservatives insist we have a SPENDING problem and want limits on government spending.

What would the "Buffet Rule" do for revenue? It would add another $47 billion over 11 years. Do we know government would spend it more wisely than the folks who earned it? Do we know that it would not do our economy more good if left in private hands?

FTA:

"So much for the idea that we could pay for Obama’s never-ending spending spree by eating the rich:

A bill designed to enact President Obama’s plan for a “Buffett rule” tax on the wealthy would rake in just $47 billion over the next 11 years, according to an estimate by Congress’ official tax analysts obtained by The Associated Press.

That figure would be a drop in the bucket of the over $7 trillion in federal budget deficits projected during that period. It is also minuscule compared to the many hundreds of billions it would cost to repeal the alternative minimum tax, which Obama’s budget last month said he would replace with the Buffett rule tax."

Since a billionaire is a THOUSAND times richer than a millionaire, I think Mr. Buffett and his fellow billionaires belong in a separate, "billionaire" category all by themselves. It is the only way to accurately reflect what an extraordinary income gulf lies between a million dollar income, and a billion dollar income. If we must demand more revenue, let's have a "Buffet Rule" that requires billionaires to really man up and pay their fair share. None of this hiding behind far, far, far less wealthy folks in the million dollar group.

Here is a link that might be useful: Buffett Rule Bust


Follow-Up Postings:

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RE: How would the Buffett Rule Help?

yep does nothing!


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RE: How would the Buffett Rule Help?

Yes, the tax on billionaires should be much higher. Thanks for pointing this out.


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RE: How would the Buffett Rule Help?

Liberals insist we have a REVENUE problem and propose the "Buffet Rule" to raise more revenue. Conservatives insist we have a SPENDING problem and want limits on government spending.

Smart people realize we have BOTH a revenue and a spending problem. Stop spending so much on WAR for one thing.


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RE: How would the Buffett Rule Help?

Yea, we have a revenue problem.

Almost half of the country doesn't pay a DIME in federal income taxes--talk about not paying their fair share!

We have a SPENDING problem.

We are spending more than we have and it is irresponsible.

Anyone that thinks the wasteful and arrogant federal government needs more revenue should put their money where their mouth is and send them more--of THEIR money.


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RE: How would the Buffett Rule Help?

We have a problem with spending and revenue. Revenue is down because of tax cuts and the economic recession. Spending is up because of the wars, defense spending, and healthcare costs. The Buffet rule would help reduce the deficit by requiring millionaires who have done VERY well during this recession and who pay low taxes overall on their investment income to pay an extra amount. I don't see whats wrong with that.


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RE: How would the Buffett Rule Help?

I wonder if those who think it's just a spending problem have any idea what type of cuts would have to be made to get the US out of the financial mess created over the last 15 years or so.

It simply is not possible without some sort of revenue contribution as well. As far as I'm concerned there are a large number who really don't care about the debt problem, even if they say they do, as long as it means they don't have to pay anymore in taxes.


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RE: How would the Buffett Rule Help?

  • Posted by sweeby Gulf Coast TX (My Page) on
    Thu, Mar 22, 12 at 13:37

You're right Demi -- We DO have a revenue problem.

When almost half the households in this country don't pay income taxes because they don't have ENOUGH REVENUE, that's a huge problem.

But then, wasn't this thread about the Buffet Rule? Not income inequality? Or is it that they go hand in hand...


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RE: How would the Buffett Rule Help?

It helps because just as if you spent like a drunken sailor 4 years ago and brought a house you could not afford (tax cuts) and 2 cars (2 wars) you could not afford you still have to pay for them.

So the Buffett Rule helps to pay these debts just as if you would have to get a second job or a better job to pay the debts. You do realize what needs to be paid is bills with interest that was made by the War looking for WMDs that did not exist and tax cuts that were not needed?

You cannot say stop spending and expect what you spent to go away. Why do everybody have to pay more? Because when our government sneezes we get a cold because we were stupid enough to elect them. It is our fault rich and poor so we have to bring in more revenue to pay what we owe and bring spending under control.

Do people not understand that a part-time job is not a lot of money but it helps if you need more to pay the bills you get every little bit that is necessary.

You do not say that "Oh well we will take it from Seniors and the poor children that the conservatives have insisted that should be born regardless of the woman's finances."


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RE: How would the Buffett Rule Help?

perhaps we can bring back the half penny to satisfy Demi's thirst for taxes from those not taxed.


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RE: How would the Buffett Rule Help?

Great idea, Labrea.

It all adds up.

1/2 cent is better than nothing.


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RE: How would the Buffett Rule Help?

Regarding taxes. IMO, the Bush tax cuts should be allowed to expire, initially for the top income earners, and after a few years, for the rest of us.

Regarding spending, the Republicans are using this Recession to acheive something they have wanted to do since Social Security, Medicare, and Welfare were started - destroy them and at the same time, destroy the regulatory agencies in our Federal government. No more EPA, FDA, FTC.. etc.
They extrapolate economic conditions and lack of revenue during a Recession in order to paint the most dismal picture possible. The Ryan plan ver 2 will end Medicare and will not even fund our regulatory agencies moving forward. They want to make it appear as though there is no way, none at all, for Medicare to be solvent. They call Social Security a Ponzi scheme, and use that argument to get young people, those who have the least aversion to seeing programs to help the elderly, die on the vine.
Warren Buffet is a wealthy man and a man of conscience. he well understands that while the wealthy can afford to pay a few percent off of their large incomes, it is different for
those who are not doing well financially, have no retirement plan, are elderly or sick without health insurance coverage, or are lost their homes and their jobs. They should not bear the burden of the Bushcrash like an old wooden cross on their backs as they plod onward to their demise.

I want universal healthcare and if we can't have it I am OK with Obamacare. I will fight for the preservation of Social Security and Medicare, and regulations that ensure clean air and water, safe food, and fair play in the financial and credit markets.
Many of those who fight for big oil, Wall street, the big banks, and making sure the rich continue to get richer because they are supposedly going to create jobs in this country, have allowed themselves to be manipulated. It's hard to speak with them because they have been whipped up into a frenzy by the media.


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RE: How would the Buffett Rule Help?

Well said Heri .........


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RE: How would the Buffett Rule Help?

I agree, except that only that I tolerate the health care reform plan that Obama was forced to settle for.

Like most Americans who do not like this plan, I feel it should have, instead, been a universal health care plan and I'm beyond disappointed that what we ended up for is what we have today.

I feel that Obama should have fought the conservatives more vigoriously, as I hope and suspect he would today if he could do it all over again -

But I suppose that like everybody else, I have to accept that he did the best he could with who he had to work with. It's a start. It's just too bad that we couldn't start with what it is we certainly will end up with some day - universal health care.

History will explain why that wasn't possible, and no etch a sketch will be able to rewrite that history.


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RE: How would the Buffett Rule Help?

I understand why the top 1% vote Republican. I'd like to think that if I were one of those top 1% I would be like Buffet and think I should pay more. But, it's hard for me to imagine being that rich, so who the heck knows how I would feel.

I understand why if you own a business where if there were less regulation you could make more money (at the expense of something like the environment) you would vote Republican.

Because when it comes down to it, we vote for our best interests.

But, what I just cannot understand is why working people who are not rich vote republican. I really want to understand this. As the new kid, I was really hoping to gain some understanding of this issue. Unfortunately, I've not been able to understand it from posts here either. There's lots of "get government out of my life" and Obama bashing, but there's never an explanation of how Republican politician's ideas work for the common working person. And, of course, there's never an explanation of how Obama's policies have hurt them.

I admire Buffet for caring. I admire him for his willingness to say he should be paying more in taxes than his secretary. And, please don't give me that BS that he can write a check if he wants. He's talking about changing the system for everyone's benefit.

If taxing the ultra rich more doesn't solve the whole problem because of course you have to look at spending too, that doesn't mean you don't take every path to a solution. Sometimes more than 1 solution is necessary but you don't not implement any one solution just because it doesn't solve the entire problem.

If I owe a debt and I can get some money from a source (extra job or whatever) to help pay down that debt, I do that. I don't say, well it's not enough to pay off the entire debt, so forget it.


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RE: How would the Buffett Rule Help?

I guess it all depends on how you feel about being miserly, while allowing the cuts to take away necessary programs that help the less fortunate.

Republicans want to gut everything we need, and keep the higher bracket tax cuts in place and the free flowing subsidies free flowing. They've become accustomed to living in such high style, and feel the middle class owe them this forced alimony.

Meanwhile, many necessary programs will suffer, like education, our disintegrating infrastructure, the demolition of our middle class, our environment, and all the safety nets that help those unable to support themselves... and more.

And that still leaves huge debt for our progeny to fulfill, even though they had no hand in the ruination, and no choice in footing the bill.

I'd never even make it to the Buffet stage, giving it all to help others. Different priorities suit different people, I guess.


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RE: How would the Buffett Rule Help?

At the risk of provoking Hay, the tax policy I would like to see is a tax on every stock transactions. It has been bounced around by many as a way to make Wall Street pay for their own bailout and reduce the deficit and as a way to put some brakes on these automated short term trades chasing after small profit margins and speculative trades that harm small and moderate investors and benefit large corporate traders. Its been estimated that a 0.5% tax could raise as much as $150 billion a year. Britain already levies a 0.5% tax on stock transactions which raises $40 billion a year and Sarkozy (France) and Merkel (Germany) announced a similar plan for the 27 countries of the EU. If you could get EVERY developed country to impose this across the globe so that investors couldn't escape it, we might actually be able to pay down our debt and get the world on solid financial footing.

It is controversial and there are diverse opinions on the benefits and negative impact on such a tax. The tax will likely be passed on to everyone and impact retirement funds. The linked article notes those arguments and links to several other discussions on both sides. The fact is we already pay sales taxes on transactions so its not like this is a radical idea. You might ask instead why stock traders get away with not paying a tax. That of course gets to the question of who runs the country and how policy favors folks who have money and influence. Ineptocracy indeed.

Most of us pay state and local sales taxes on most things we buy, and most casino gambling is subject to state taxes ranging from up to 6.75 percent in Nevada to 55 percent on slot machines in Pennsylvania.

But speculative purchases of stocks, bonds and other financial instruments in the United States go untaxed but for a tiny fee (less than a half-cent) on stock trades that helps finance the Securities and Exchange Commission.

In Britain, by contrast, a 0.5 percent tax on stock transactions raises about $40 billion a year. President Nicolas Sarkozy of France and Chancellor Angela Merkel of Germany recently announced plans to introduce a similar tax in the 27 nations of the European Community.

It is variously called a “transactions tax,” a “financial transactions tax,” a “security transaction excise tax” or a Tobin tax (after the Nobel Prize-winning economist James Tobin, who famously argued for its application to foreign exchange purchases in the late 1970s).

By any name, Wall Street hates it, because it would cut into trading profits. But proponents like Dean Baker, co-director of the Center for Economic and Policy Research assert that it would primarily affect short-term “noise traders” and discourage speculation rather than productive investment.

Less speculation could lead to less volatility in prices, encouraging long-term investors.

Further, a sales tax on Wall Street of 0.5 percent could raise up to $175 billion in tax revenue a year, even if, by discouraging frequent trades, it cuts the total number of transactions in half.

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Professor Angel also points out that a tax on financial transactions will be passed on, at least in part, to all investors, with negative consequences for retirement savings. But all taxes are passed on, at least in part, to consumers. I agree with Professor Pollin when he argues that the effect of a financial transactions tax on most people would be very small compared with other sales taxes.

Economists point out that sales taxes discourage consumption, which is better than discouraging investments that can pay off in the future. But many consumption decisions that ordinary people make have important consequences for future productivity.

As Professor Pollin points out, current sales taxes bite those who buy materials to increase energy conservation in their homes or purchase a more fuel-efficient car.

My own research emphasizes that parental expenditures on children, as well as public spending on health and education, represent a form of investment in human capital.

Most state and local sales taxes are very regressive, with low-income families paying more as a percentage of their income. A proposed national sales tax, or a value-added tax, would have an even more negative impact on families at the bottom.

Our current tax policies favor speculative investment in financial instruments over productive investments in human capabilities. This imbalance helps explain why nurses’ unions in the United States have been particularly outspoken advocates of a financial transactions tax.

Here is a link that might be useful: A tax on Stock Transactions?


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RE: How would the Buffett Rule Help?

  • Posted by sweeby Gulf Coast TX (My Page) on
    Fri, Mar 23, 12 at 13:09

A tax on financial transactions...

An intriguing premise KT -- I think I like it!


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RE: How would the Buffett Rule Help?

The OP misframes the positions of liberals. The democrats want to return to previous tax rates AND cut spending and they proposed to do this gradually over a number of years. The republicans want to cut taxes and cut spending and do it all in one budget cycle.

It should be pretty easy to figure out which one will work and which one won't.


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RE: How would the Buffett Rule Help?

"Should" being the key word, Joepyeweed. It's as clear as glass to me.


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RE: How would the Buffett Rule Help?

  • Posted by vgkg 7-Va Tidewater (My Page) on
    Fri, Mar 23, 12 at 18:07

Romney is already burdened enough at 13.9% tax, but not to worry, he'll cut himself some slack once he's prez.


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RE: How would the Buffett Rule Help?

"So the Buffett Rule helps to pay these debts just as if you would have to get a second job or a better job to pay the debts."

$47 billion over 11 years is around 4 billion a year.

How much does our government spend in a day? Here's a link that says it spends FOUR BILLION DOLLARS EVERY DAY. At best, the Buffet Rule would do no more than pay for a single day of government spending out of 365. Big deal.

Here is a link that might be useful: $4 billion a day?


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RE: How would the Buffett Rule Help?

We could toss in the $500 mil (conservatively) we could have saved in the absence of the Solyndra fiasco. Still not enough.

The way I see it, its kinda like Walker and Wisconsin. Take away from one group and justify it however you can.

Seems like cutting waaay down on government waste is a more logical place to start.


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RE: How would the Buffett Rule Help?

Seems like cutting waaay down on government waste is a more logical place to start.

*

Ya think? ;)

One can always hope.


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RE: How would the Buffett Rule Help?

Nik government is like a bucket with a hole in the bottom.
It doesn't matter the amount poured in it goes out faster than you can fill it.
I made the comment on another thread somewhere here that the waste has to be made a big issue before we can ever see any progress.
I don't know that any amount of money....even 10000000 tril
wouldn't be sucked up by government leechers.
Its like giving your pay check to the worse money manager you know in your family.
I was told I was a pessimist because I was thought to be saying then lets do nothing but ...wonder how much is in Medicare fraud? Special interest fraud. Salary fraud.
The largest tax hikes in history would not bail us with all the waste.


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RE: How would the Buffett Rule Help?

Repeal the Bush Tax Cuts.

Add a surtax on those earning more than a million a year.

Cut 20% from defense, bring our sons and daughters home.

Extend the retirement age for Medicare and Social Security, remove the income cap. Pay for more fraud prosecution.

Trim the huge subsidies for agribusiness, (Mohair, anybody?), earned income credit, heating allowances, and some of the other programs that are either obsolete or grown into mini industries on their own.

Takes an effort from both ends of the equation.


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RE: How would the Buffett Rule Help?

Oh good grief. You could make the same case for any group's tax obligation. That's not a reason not to collect the tax. It adds up. That's how taxes work. You cut some and you collect taxes some. The amount is certainly more substantial than the pittance Republicans want to cut from PBS or NEA to balance the budget.


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RE: How would the Buffett Rule Help?

Do both - make cuts (waste, military) and raise revenue. We need both.

Unfortunately conservatives only want to play a shell game when it comes to raising revenue. They are hampered by a stupid pledge they made to Grover Norquist (not the American people) about raising taxes. They always have to run to him to see if they propose is "ok". Then he gives them "permission" or not.


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