Return to the Hot Topics Forum | Post a Follow-Up

 o
Truth about taxes

Posted by david52 z5CO (My Page) on
Thu, Apr 12, 12 at 11:57

"Since everyone is filing their returns this week, what better time to call out the charades both parties peddle on taxes? The big Republican lie is that we don't need to raise taxes at all, even as the boomers retire and we double the number of people on Social Security and Medicare. The big Democratic lie is that we can get America's fiscal house in order by raising taxes only on people who earn more than $250,000 a year. More than most political deceptions, these two warp the debate in ways that make pragmatic progress impossible.

Let's start with the GOP lie (which I should note for the False Equivalency Police is the more egregious). Taxes are going up in the next decade no matter who is in power, because even after we eventually enact sensible restraints on the growth of Medicare and Social Security, the tidal wave of new retirees means the math doesn't work at current levels of taxation.

Don't take my word for it. When I was writing my 2009 book, "The Tyranny of Dead Ideas," I spoke with Dan Crippen, the former Congressional Budget Office chief who was a top adviser to John McCain's 2008 presidential campaign. (Our ground rules were that I could not attribute these comments to Crippen until after the campaign, because a "straight talker" like McCain could not be seen to be advised by someone who actually talked straight on taxes! The passage below is drawn from the book.)

Are taxes going up? I asked.

"Yeah," Crippen said. "I think it is inevitable."

"If you were a betting man at this point, are taxes going to be higher as a share of GDP in 2020?"

"Definitely."

"How much higher?

"I don't know."

"Ballpark."

"Twenty-two [percent of GDP]," he said. "But 2020 is still a little bit at the front end of the boomers. You can figure 24, 25 by 2030."

Bear in mind that this year taxes will run about 16 percent of GDP. Paul Ryan's budget, which Mitt Romney endorses, assumes they'll be at their recent historic level of 19 percent of GDP in perpetuity, though the Tax Policy Center reckons Ryan's proposals will, in fact, leave taxes at more like 16 percent. Bottom line: Mitt Romney has a secret plan to borrow trillions for the baby boomers' retirement from China!

"Let's say we're at 22 in 2020, up from 18-ish today," I asked Crippen. "Is that some disaster for the economy? Will it really make a big difference?"

"Probably not," he said. "Depends on how you do it, of course."

Douglas Holtz-Eakin, another former CBO director who advised McCain, basically told me the same thing. I asked Holtz-Eakin back then why tax-cutting mania persists among Republicans. After all, the impact of further marginal rate cuts can't be great when rates are already much lower than they were back when Ronald Reagan sensibly sliced them from 70 percent. And, as Holtz-Eakin himself understood, taxes would soon have to go up to fund the boomers in any event.

"It's the brand," Holtz-Eakin told me. "And you don't dilute the brand."

Democrats, of course, aren't allergic to taxes in general - they just act as if they only need to be raised on the rich. Now, make no mistake, I'm for well-off Americans contributing more to the fiscal adjustment the country needs. As I wrote recently, I'd see Obama on the Buffett Rule and raise him a Dimon Rule - as in JP Morgan Chase CEO Jamie Dimon's support for a new higher rate for earnings above $10 million a year. Harry Reid should put Dimon's idea to a vote next Monday along with Buffett's.

But raising taxes on the top, while an important part of a fiscal fix, won't suffice to fund the boomers, shrink the deficit and pay for fresh investments in R&D, infrastructure and education. Acknowledging this fact doesn't help Democrats win elections, however. And President Obama wants to keep (for this term, at least) his vote-winning promise not to raise taxes on any but the top.

I know it isn't easy for politicians to tell hard-pressed Americans the truth: that funding an aging America while also investing in the future means we'll all have to pay a little more.

But no one forced Obama to boast in the last campaign that he'd "tell you what you need to hear, not just what you want to hear." Guess he didn't mean that to apply to things people really, really don't want to hear.

If we had a serious third voice in the presidential campaign, Romney and Obama wouldn't be able to sustain these deceptions. The right kind of independent candidate would explain that the real question on taxes, once the economy is back on track, is this: Given that taxes have to rise, how should we raise the revenue we need in ways that are best for the economy? The answer would involve lower taxes on payrolls and corporate income, and higher taxes on dirty energy and consumption.

Unless the Americans Elect process attracts a truth-telling candidate of stature in the next six weeks (a prospect that seems increasingly unlikely), you can kiss that - and many other much-needed debates - goodbye.

Here is a link that might be useful: link to column


Follow-Up Postings:

 o
RE: Truth about taxes

That assumes that the taxpayers SHOULD be funding the baby boomers and retiring generations for living expenses and their health care.

I contend that people should be responsible for their own later years and prepare for it.

It's the right thing to do--not depend on someone else to fund your living expenses and health care in your old age.

There is no need to raise taxes.
More people should pay their share (almost half do not pay any federal income tax) and less money spent.


 o
RE: Truth about taxes

Yes, but when one works out how much money each person should have to insure their own retirements and medical expenses, - call it a million in todays dollars, and then compare that with current wages, and see how that works out.

Invested, of course, over a life time in that rock-solid stock market.


 o
as well

Oh, so the baby boomers who ran up the huge deficit and are allowed, under the Ryan plan, to enjoy their retirement benefits, get to stick the coming generation - not only with their debt to pay, but then have to cover their own retirement, on their own.

And the wealthiest get even more tax cuts.

IOW, that old saw about 'personal responsibility' has never been so clearly stated as hey, I got mine, you're on your own.


 o
RE: Truth about taxes

I have one easy to answer question.

How many of you have paid the required State Use Tax?

Yes. I did file my State Use Tax Form.

No. I don't pay that tax. I already pay enough tax.


 o
RE: Truth about taxes

Yes, Brush, I have. We live near the border to New Hampshire, which has no sales tax, and they have bigger appliance stores etc than around here. We pay largely because we suspect the IRS keeps a closer eye on these things in states neighboring tax-free states.


 o
RE: Truth about taxes

Businesses in California had better file and pay use taxes. The State Board of Equalization audits and imposes penalties for non-reporting and non-payment.

I shop and purchase locally and pay sales taxes so no need to worry about use taxes.


 o
RE: Truth about taxes

Those people that pay no taxes are just taking advantage of legal tax deductions...just as you do I'm sure Demi. There is NO difference.

I know much about planning for your retirement. A million dollars in investment income will net, if invested wisely, at best 35K-40K a year in interest. To live on that you need to erode the capital. Which is fine.

500K gets you maybe 15K in interest which means you for sure need to erode the capital.

How many people do you think there are that can manage a MILLION dollars or even 500K in investments?

I don't believe in "welfare" for the elderly but programmes like SS and Medicaid are essential.

For those who smugly think otherwise you need to think of the impact to society if these programmes did not exist.


 o
RE: Truth about taxes

Chase, I'm not suggesting it be done overnight.

We've spoiled people since Roosevelt.
They EXPECT a check from the government and do not plan.

People with those amounts of money are usually fairly smart to begin with unless they won the lottery or are professional sports players, actors, or criminals.

Quite often lottery winners, actors, sports players and criminals wind up with no money BECAUSE they aren't smart and do not know how to handle that kind of money.

But people that earned it over time, or were smart enough to make it in a short period of time, prepare themselves to handle their finances, or at least understand enough about them to have a keen and watchful eye over who they hire to help them invest that kind of money.

Certainly people that have paid into social security should get at least what they put in (I would be happy to take out what was contributed, and not a dime more, and be done with it). As it is, it is unsustainable, just like the pension programs that are coming home to roost.


 o
RE: Truth about taxes

Amazing, isn't it? That all these private pension plans are going belly up, and the only one left standing is social security and other gvt backed plans.

And the 'conservative' solution, is, of course, to privatize that as well, and shift all that money to Wall Street.

They're looting the country, folks. Elect them again, after the Bush fiasco, and let them finish it up. They aren't hiding it, they're openly declaring that they will dismantle the government.


 o
RE: Truth about taxes

and the flock continues to follow. Just amazing, isn't it?


 o
RE: Truth about taxes

Demi, is it truly your contention that everyone in the United States can earn enough money to put aside 500K to a Million in retirement savings if they wanted to?

Do you understand what that means in terms of salaries for the services we all depend upon. Are we are willing to pay Walmart packers, car wash attendants, waitresses, hotel cleaning staff, lawn maintenance, farm workers and on and on that kind of money? Or are are we willing to do without all the services and products low wage job brings us?

Yes I know you said it's a matter of choice, they could all be Waltons if they wanted to be and worked for it BUT if those jobs don't exist, at the low wages that are paid, then your lifestyle and mine takes a big leap south......a huge leap south.

Be careful what you ask for ...you may get it.


 o
RE: Truth about taxes

Cannot look out for you own best interest. Even when the figures and words flowing from their mouths, they put it in writing and still the flock follows.

Demi is right. People are not smart enough. When you cannot navigate the background noises to figure out what is best for your own survival you cannot be very smart.


 o
RE: Truth about taxes

Chase, of course not everyone has the talent or ability to make a million dollars to retire on.

You don't have to.

You can live frugally.

I will tell you this--there is no finite pie, and many, many more people could have some money put back and in the bank, or at least more to blow--but they would have to make different decisions and sacrifices.

They can postpone having sex until they can accept that they might procreate, they can not get married or shack up and have children they have to feed on a limited budget, they can go to school and work a job or two and get a better job after more education.

They can pick up and travel to a different part of the country (we still have bus lines) for a better job.

They can get roommates or live at the Y while they save money, and they don't have to have a cell phone, Iphone, plasma tv or beer.

They can get off the internet and spend that time being compensated for something by someone. I haven't had anyone knock on my door wanting to weed my beds or clean my windows since I've lived here. That used to happen all the time. Why would anyone do that when all they have to do is sign up for a government check?

I'm saying, we're a product of our choices (except for those that have no choice, like physically or mentally disabled people and those that care for them) and if you don't like the position you're in, examine what you could do to change it and when people are honest they realize they COULD change things but choose not to.

Like picking up and moving somewhere, or not quitting work at 5 and popping back a beer and watching tv at night.
Or like not having two cars and one parent stay home with the children instead of complaining about child care costs.

Or, being very careful about who you procreate with and make sure the person has enough integrity to at least do their share in taking care of children they create so it's not all dumped on one parent if the relationship fails.

Of course, we don't all make the best decisions, but those decisions ARE IN OUR HANDS.

There's nothing wrong with living in a tiny house built by your own hands and living in a frugal manner. I know an elderly couple that retired on $50,000 about thirteen years ago.

They are the parents of a friend of mine. The lady wore two "uniforms," jean capris and a white shirt in the summer and black slacks and a sweater in the winter. They bought day old bread and used every free government service they could get. They even got a designer dog for free because it had a heart condition, and then got free vet care for the dog (it died early). They bought a used car and built a house with only the basics. They had a good life and played cards and fished in their retirement.

People don't NEED a half million or million dollars unless they want to lead a lifestyle like they see on television and like they THINK they need.

Of course I know that expenses are continuing to rise, and that's why I'm more concerned with getting health care costs and oil prices and inflation (which I believe is coming) under control so that people DO have a fighting chance, even those that make the lowest wages.

I happen to think that we should have a president in the White House that is more concerned with getting costs under control and people back to work than worrying about passing out checks and redistributing wealth.

Tiny House


 o
RE: Truth about taxes

Demi, all well and good. People can do all of those things but will still need programs like SS, medicare etc to make it through their retirement years.

There is no way on earth that the couple you refer to retired thirteen years ago on 50k and are making it without the benefits of SS and medicare.... no way on earth.

My reference to 500k plus in savings was to illustrate what you would need if there was no such thing as SS and medicare. You know it and I know it.


 o
RE: Truth about taxes

There is no way on earth that the couple you refer to retired thirteen years ago on 50k and are making it without the benefits of SS and medicare.... no way on earth.

*

Yes, you are right.
And I don't think they could have made it without social security and medicare but they paid in. The mother didn't stay sick long so I'm not sure how much medicare she actually used. He worked for over fifty years so he paid in a lot to social security.

My point is, people can make it if they WANT to and if they plan. You don't have to have social security and medicare.

I don't think we're going to have it, as they exist now, anyway.

So instead of sitting around waiting on the federal government to take your money, use if for something else and dole it back to you as they see fit and how they see fit, I suggest people take a long hard look at providing for their own future.

I also suggest that they consider doing something about costs rather than sitting back and watch them escalate and wait for the GUVMINT to pay the bill. I can assure you, as long as the GUVMINT pays the bill, people won't care how much is charged.

Just ask the GSA.


 o
RE: Truth about taxes

They bought day old bread and used every free government service they could get.

Wait, I don't understand. I thought your point was there shouldn't be any of those "free government services". They should have somehow saved enough money to make it on their own. Without any help from the government. Isn't that what you want? Did you tell these parents of your friend that you did not want to be paying for these services they were using?


 o
Beans and Franks

My point was that people don't need a million dollars to retire.

Or even half a million.

These people paid into the system and depended on it.
She died early and he is still collecting social security, but he worked for fifty years.

I have said that I don't think our society should actually be in the business of forcing people to give them money, then dole it back out to them. That's a Nanny State and assumes people aren't disciplined enough to provide for themselves.

As long as people know the Nanny State will be sending them a check, what incentive to they have to be disciplined and save on their own, additionally? (other than people like me, there are some of us and I'm sure plenty on this forum).

But because the government has confiscated money from my paycheck, you'd better believe I want what's been paid in. I don't want more than I paid in, which is what a lot of people are getting and will get.

That's beside the point.

My point is that people have choices in life and they don't need to save a million or even a half million dollars to make it in their later years. They may have to work, they may have to live in a more frugal manner than they planned.

But it can be done.


 o
RE: Truth about taxes

Demi, yes they paid in but if you do your homework you would know that 3people get much more out than they pay in.

In Canada there are two levels of "old age security" one we pay into like SS and the other is automatic once you reach 65.

If I had my way both would be dealt with by a means test. I do not buy into the school of " I paid into it therefore I'm entitled."

My good fortune is not entirely of my own making. I was privileged to grow up in a country that made it possible for me to have what I have in so many ways. I'm ok with paying back so others can have it a bit easier in their retirement years. I'm ok with knowing my fellow Canadians have access to healthcare without fear of the cost even if that means I pay a bit more in taxes.

I'm so lucky that I have no reason to be resentful of what others get in terms of making their life a bit better.


 o
RErerere: Truth about taxes

You know I don't know a single person that thinks that their SS check is going to be enough money for them to live on when they retire. But I also know a lot of people that do not have a lot of extra income to save for retirement either. And they don't live extravagently. They are frugal. But their limited dollars can only go so far.

You try to make it sound like the majority of people think SS is going to support them in an extravagent lifestyle and it's just not true. Just one of those things you keep repeating, but it doesn't make it true.


 o
RE: Truth about taxes

Some are not going to be happy until the gap between the haves and have-nots is even greater, like the class divisions and economic conditions found in our neighbor to the south.

Endorsing policies that lead to even greater income inequality - I can't inflict that pain on my fellow citizens. We're supposed to be a global leader, yet so many would willingly return us to conditions that existed in the Great Depression before the election of Franklin Roosevelt. Hoovervilles, and hobo camps; encore performances in the 21st century.


 o
RE: Truth about taxes

Posted by jillinnj (My Page) on
Thu, Apr 12, 12 at 22:36

You try to make it sound like the majority of people think SS is going to support them in an extravagent lifestyle and it's just not true. Just one of those things you keep repeating, but it doesn't make it true.

*

WHAT? I never said or implied such a thing; who can live extravagantly on social security?

Where did I say anything like that?

I explained how people don't NEED a half million dollars to live frugally. I didn't say how well you could live on social security.

Where do you get this stuff and why do you say I keep repeating it when I never said it to begin with?

Read my posts, Jillinnj and take your prejudice about me and what you think I think out of your posts.

Weird.


 o
RE: Truth about taxes

Demi on another thread you stated categorically that you wanted to see SS and medicare abolished completely. I have neither the energy nor the time to go find that statement but I recall it clearly.

I never said that people NEEDED a million or 500K to retire. How dare you twist my words. How dare you suppose to know what I think. Read my posts.


 o
RE: Truth about taxes

I did say that I wouldn't mind seeing it abolished, but not for those that have already paid into it Chase, and that's a lot of people !

I don't have a problem with it if it's administered in a better fashion and the age is raised and it becomes viable.

But on the principle--yes, I think people should take care of themselves and not expect their taxpaying citizens to subsidize their lifestyles except for a safety net, on a temporary basis.

People should save themselves, and we should work to ensure that costs are reasonable. With so many at the trough since the government is involved in just about every aspect of our lives, that's probably not ever going to happen.

But in Demiworld, people should take responsibility for themselves, and when they have problems after trying and making good decisions, THEN the government can help, and certainly individuals and the community charities can and should help.

I don't DARE suppose to know what you think or try to twist your words.

If that's not what you meant, then you just said so.

I thought you meant for people to live a good life in retirement that's about what they needed.

I wasn't trying to "twist" anything but only show that people don't need that much money.

And yes, for the lifestyles that probably some of us here live and many others, those amounts are very reasonable.

PS--how many times have I been misrepresented and MY words twisted here? Just about every day someone says I say something I NEVER SAY but what they THINK I meant.

You used those figures, I'm not interested in going back and arguing with you, but don't assume I'm like some of you here and wanting to twist anyone's words.

I WANT to understand what all of you mean, and I'm happy to be corrected if I do not understand.

There is no interest in playing games, so don't assign that stance to me, please.


 o
RE: Truth about taxes

cat fight!

Social Darwinism seems to be the operative acceptible process of running the country among regressives. Progressives are becoming a lot more conservative in light of these regressive policies designed to roll back the social fabric in this country.


 o
RE: Truth about taxes

WHAT? I never said or implied such a thing

Because you keep saying things like this:

As long as people know the Nanny State will be sending them a check, what incentive to they have to be disciplined and save on their own, additionally?

and this

You can live frugally.

over and over and over again.

If it's not what you mean, stop saying it.


 o
Mew Mew Mew Mew

Marshall, I never did it and don't want to start it now.
Life is too short for this stupidity, actually.
I sure hope that people that don't understand this yet don't get a wakeup call like some of us have. Or a reminder.

Until they do, pettiness can overtake a person, particularly those that have lived it their entire lives.

It's beneath my dignity, but when attacked by a cat's claws, I will not run.

And yes, you can assume I think I'm superior in that regard, catty ladies, because you don't see me attacking your character and criticizing you personally for giving your opinion on a topic.


 o
Pay Attention!

jillinjj, I'm not sure how in the world you arrive that I have said that I think people can live extravagantly on social security because I also said that people can live frugally and that people that know they are going to be receiving a government check don't have an incentive to be disciplined to save on their own for retirement.

Tell me, EXACTLY, how you arrived at that allegation about what I said and meant.

Because I never said anyone could live extravagantly on social security.

Honestly, your comments and allegations don't make sense.

That's your problem, not mine, because I've gone out of my way to explain it several times.

And I'm not going to "stop saying" anything, dear.

Who do you think you are to come on this forum and tell me stop saying anything when you apparently can't understand plain English?


 o
take your own advice

You have on several occasions said to me "Stop it". That's ok, but I can't do the same? Interesting.

When one says over and over again that people expect a check from the gov and should instead live frugally that STRONGLY IMPLIES you think they expect to live extravagantly on DEMI's dime. If you can't understand the implications of what you say, I can't help you. And I'm done trying.


 o
RE: Truth about taxes

Demi, I stand by what I said. You misrepresented my words, something that you constantly blame others for.

Not only that, you say that everyone can save enough to handle retirement without the benefits of SS and Medicare and that is simply not so.

The wages we are prepared to pay people for all the services we enjoy, and need, make it impossible for them to save the type of money required to live even a frugal life.

If we paid a wage that allowed people in lower income jobs enough to save for their retirement it would cost us, as consumers, a whole bunch more than the taxes we pay for our social programmes.

We need people in menial jobs in order for us to function as a society. The least we can do is provide the social safety net needed for them to live out their old age with a minimum amount of comfort.


 o
RE: Truth about taxes

The least we can do is provide the social safety net needed for them to live out their old age with a minimum amount of comfort.

Well said, Chase.


 o
RE: Truth about taxes

Which is exactly the original intent of SS.

Take that - and other safety nets - away and we really are a lesser people.


 o
RE: Truth about taxes

But think of the commissions the big banks and investment houses could make if all that money was invested in the stock market.


 o
RE: The truth about taxes...

It's not for their lack of trying.


 o
RE: Truth about taxes

When one says over and over again that people expect a check from the gov and should instead live frugally that STRONGLY IMPLIES you think they expect to live extravagantly on DEMI's dime

*

No it does NOT IMPLY THAT.

Never said it.

What are you thinking?

You don't have to live extravagantly to live off someone else.

I did not say it, I did not imply it, and I did not intend to imply it.

I have family and friends living off of social security and I know full well none of them live extravagantly.

I would never say something I don't believe or don't mean.

So now you are saying my words "STRONGLY IMPLY" I meant that.

Did it ever occur to you, jillinjj, that because of the way YOU think and the way YOU think of me, that you wrongly INFERRED and attributed words to me I never, ever said?

Try it.

Chase, go ahead, I told you I didn't misrepresent your words, or mean to. You made a statement about people and an amount of money to retire, I wasn't arguing, I was pointing out that people can get by with much less than wha society and our habits and our neighbors dictate that we need. That's why I attached the link on the Tiny House. That had nothing to do with your words, and I don't believe I brought you into my point, personally.

If you want to accuse me of something I did not do, or did not mean to do, have at it.

Demi's a little punching bag today, but that's okay, I've worked out at the gym, punched out plastic instead of other people, and I'm a happy thinker.

Have a great weekend you angry people.


 o
RE: Truth about taxes

Yup, I must say the all facts are quite true, but it is a bitter truth that we are still pursuing them. Tax Payers are still suffering with high deductions.

Here is a link that might be useful: Manange your finance with chartered accountants toronto


 o Post a Follow-Up

Please Note: Only registered members are able to post messages to this forum.

    If you are a member, please log in.

    If you aren't yet a member, join now!


Return to the Hot Topics Forum

Information about Posting

  • You must be logged in to post a message. Once you are logged in, a posting window will appear at the bottom of the messages. If you are not a member, please register for an account.
  • Please review our Rules of Play before posting.
  • Posting is a two-step process. Once you have composed your message, you will be taken to the preview page. You will then have a chance to review your post, make changes and upload photos.
  • After posting your message, you may need to refresh the forum page in order to see it.
  • Before posting copyrighted material, please read about Copyright and Fair Use.
  • We have a strict no-advertising policy!
  • If you would like to practice posting or uploading photos, please visit our Test forum.
  • If you need assistance, please Contact Us and we will be happy to help.


Learn more about in-text links on this page here