Obama say he can finance his dreams from his father by taxing the rich at higher rates while cutting the taxes of 95% of the public, but has anybody made a new estimate of how much adjusted gross income the rich will have in 2009 and 2010?
For example, baseball players' salaries are coming down. Bobby Abreu, a very consistent player who made $16 million last year while hitting .296 with 20 homers and 100 RBIs, could only get a one-year $5 million dollar deal this year. I suspect that the real damage to baseball contracts will get done next year after a lot of skybox contracts aren't renewed this year.
Is Wall Street going to be handing out huge bonuses again this year?
Are oil companies going to be making vast profits?
So, there's no way Obama can cut taxes on the bottom 95% without running up huge deficits. Of course, those "unexpected" deficits will be redefined as additional "stimulus" due to the financial crisis. But that level of spending will then get built into expectations for the future.
For example, baseball players' salaries are coming down. Bobby Abreu, a very consistent player who made $16 million last year while hitting .296 with 20 homers and 100 RBIs, could only get a one-year $5 million dollar deal this year. I suspect that the real damage to baseball contracts will get done next year after a lot of skybox contracts aren't renewed this year.
Is Wall Street going to be handing out huge bonuses again this year?
Are oil companies going to be making vast profits?
So, there's no way Obama can cut taxes on the bottom 95% without running up huge deficits. Of course, those "unexpected" deficits will be redefined as additional "stimulus" due to the financial crisis. But that level of spending will then get built into expectations for the future.
My published articles are archived at iSteve.com -- Steve Sailer
Posts
44 comments:
I think the top 5% should pay 70% of the taxes. Fine by me! Tax the rich. Most of them are inheritors or high-IQ corrupt business people who have abused their workers.
i think the bottom 75% of earners should not vote. that would solve a lot of problems.
The top 5% of the population made 36.66% of all income in the U.S. in 2005.
Ending the Iraq war and raising their taxes will do plenty.
From what I know the very rich basically do not pay taxes. So Obama must be obfuscating his real target group: middle class whites.
If you factor in the leg-up that AA gives NAM's, whites are already racially discriminated against with taxes.
Top 5% of individual earners in the US is only about $100K. (
http://pubdb3.census.gov/macro/032006/perinc/new03_001.htm)
Most of the people making this much are professionals and small business owners.
I am in favour of a high tax on inheritance. Either spend your earnings before you die or let the government use to pay off debt.
You are correct, he is shooting at a falling target, and some Congresscritters are already calling him on his overly optimistic assumptions of future growth. This orgy of spending could not be coming at a worse time for our economy. It is as if he was really out to destroy our economy, wealth, and way of life.
Equality is great. Too bad we'll all be poor together.
They are going to tax energy producers and users. They claim it is a “carbon” tax, but it is really just a modification of the BTU tax that was put forward in the first Clinton administration and failed. By taxing energy, they tax everything that moves or lights or heats or cools, meaning just about everything. They think they can sell it with global warming and by stealth, and maybe they are right. The BTU tax failed cause too many folks figured it out, but back then there were more intelligent Americans around.
I'll give you my own fer instance:
For 2007 I paid about $15k in taxes on capital gains. For 2008 I made quarterly payments totaling $16k on what I estimated my capital gains taxes would be for that year. I will be getting all of that money back. And I will not be giving the gov't anything in quarterly estimated taxes this year because I do not expect any capital gains income. If I end up having any I'll pay whatever penalty I have to pay in April of 2010.
I wonder if there are any other Americans who will be getting big refunds on excess quarterly estimated taxes paid.
...And the trees are all kept equal
By hatchet, axe and saw.
Since we are all (in aggregate anyway) going to earning less this year, those who fail to adjust (down) their federal income tax withholding are probably going to be owned a big chuck of overpaid taxes come April 2010. President Obama wants you to have that cash now! Redo those W-4 forms, or however withholding is set these days. You know you need the money.
And of course any income that had been generated through exercising stock options won't be happening this year at least.
I'd be much more in favor of a more steeply progressive tax, say another 1/2 point for every 250k, so that someone making $5mill would pay an extra 10%, while the hit on people earning less than $1m would be mild. I just don't believe that any real long term benefits to society are happening as a result of the efforts of people making multi-millions of dollars - in fact I'd say they're the ones doing the most damage.
It doesn't really matter, because federal spending is not revenue-constrained. Taxes exist only to make room for spending by reducing demand. With demand this low, there's no reason to collect much in the way of taxes at all. We sould be reducing taxes, particularly the regressive payroll tax, until the economy recovers.
Details details.
The only thing old money hates more than new money is new old money. Thus, inheritance taxes.
But I digress. I think Obama is half-smart. On the one hand, he's a slick operator who knows how to reward his friends. But on the other, he's a skinny kid who has no idea how wealth is created. He imagines, in this wide-eyed, cargo-cult kind of way, that business entities just print their own money for him and his social engineer buddies to tax. As more bubbles are liquidated thru his term (and elsewhere, Mexico devolves into a failed state, pan-Arabic nationalism erupts, European tribalism resurgent, etc.), he'll be as impotent and clueless as Carter. So the good news is, four years isn't so long a time.
--Senor Doug
Dale Franks at the Q&O took a stab at the fundamental math:
http://www.qando.net/?p=1195
"After Dale played with the numbers [xls] for awhile, he arrived generally at the conclusion that the absolute most that could be raised was in the neighborhood of $85 Billion, and at worst around $55 Billion. On average, Dale calculated that approximately $65 Billion was the likely amount of new tax revenue that could be expected if all payers in the 2006 cohort behave exactly as they did then."
"Anonymous said...
Either spend your earnings before you die or let the government use to pay off debt."
Which gives the government every incentive to kill you. In the able hands of wise emperors like Caligula, Nero, and Caracalla, this worked out really well for Rome.
I'd heard that California (among others) was going to be back in crisis mode sometime in the summer when they discover that tax receipts are coming up short, somewhere in the neighborhood of 6-7 billion. Sorry I don't have a link, but I think I'd read it over at Mish's somewhere.
Raising taxes on the rich and cutting military spending won't be nearly enough to make up the gap. Watch for the Feds to dramatically overstate deflation much as they understated inflation in order to further gut SS and Medicare; but that's only if they feel shame. They might just fold those taxes into the regular taxes and get rid of the funding protections for the FICA programs, since only by biting into that soft, juicy middle class can they even come close to paying for their dreams.
Taxing inheritance sounds good in theory, but is completely futile. There will always be ways around it. A dying man will just transfer his money to family members before he kicks the bucket, and sell the mansion to his son for $1.
"I am in favour of a high tax on inheritance. Either spend your earnings before you die or let the government use to pay off debt."
This jealousy and hatred of inheritance is why the poor will always remain poor. The rich get richer and other families rise in social class largely because of inter-generational support.
I'm sorry that your old man kicked you out of the house the day after your 18th birthday, but that doesn't mean that you have a right to steal my inheritance to pay for your social engineering schemes.
I think we need to start a National Service program. Those who can pay taxes should and those who cannot should be made to clean bedpans in old folks homes.
Am I the only American left who really thinks we should slash about 95% of federal spending?
Just saying...
What's everyone have against inheritance?
There are some very good long term reasons not to punish bequeathal.
Let's pass the hat around, buy a dozen copies of Steve's book, and have them couriered overnight to the media, the "Two Degrees of PNAC" commentariat who gave Obama a free pass in particular, so they cannot deny having been briefed on Obama.
America just handed the keys to the world economy to a guy who felt like a spy behind enemy lines the one time he ever earned a thin dime in the public sector.
Q: Why is Aspirin being taxed by Obama?
A: It's white and it works.
I agree the super rich, 'wall street' east liberal inner party rich will NOT get taxed signifigently. this will fall most heavily on what remains of the white middle and white upper middle class.
Inheritance is for losers. Anyone defending their "right" to an inheritance is basically admitting that they can't cut it on their own. Tax it or let it be - either way most people that inherit money manage to piss it away and those that don't would have been fine without it.
You mentioned Bobby Abreu. I notice that Manny Ramirez resigned with the Dodgers yesterday, and he's going to make slightly less than what he did with his contract that just expired.
I think anonymous meant "private sector" and not "public sector" in the sentence "America just handed the keys to the world economy to a guy who felt like a spy behind enemy lines the one time he ever earned a thin dime in the public sector."
Leastways, I sure hope he did.
Most of this discussion has been about income taxes. Exxon paid $32.36 billion in taxes in the second quarter of 2008 alone. That won't be happening this year. Also this year, a lot of other corporations are going to pay less taxes. A lot less gasoline/energy taxes will be collected because prices and demand are down. Less FICA taxes will be collected because fewer people are working. Less sales tax revenue will be coming in because people aren't buying anywhere near as much stuff. The federal and state deficits are going to be ginormous.
"I think the top 5% should pay 70% of the taxes. Fine by me! Tax the rich. Most of them are inheritors or high-IQ corrupt business people who have abused their workers."
I'm humor-impaired sometimes and fail to recognize irony, but I'd nonetheless like to point out that this is pretty much the case now. According to the National Taxpayers Union, the top 5% of tax filers paid 60.14% of all income tax revenues in the 2006 fiscal year. Of course you gotta remember that this only counts people who pay income tax; Warren Buffett, Bill Gates, and nominees to the Obama cabinet don't.
I'm going to go out on a limb and guess that everyone posting in this thread wanting to tax the hell out of inheritance stands to inherit squat, and everyone defending it stands to inherit a sizable wad, with absolutely no exceptions. Am I right?
I don't stand to inherit squat, and I think inheritance taxes are absolutely vile. Again, it's just old money making sure there's never any such thing as new old money.
--Senor Doug
It is as if he was really out to destroy our economy, wealth, and way of life.
I'm glad you finally figured that out.
I paid 150k+ in taxes last year, this year i will pay $0.00 since i'm unemployed with no real prospects of employment (can you guess my industry?) Most of the people I know are in exactly the same or very similar situation. The fall in tax revenue from wall street will be nothing short of catastrophic.
Inheritance is for losers. Anyone defending their "right" to an inheritance is basically admitting that they can't cut it on their own.
You're full of shit. Anyone denying property rights is basically admitting to being a commie.
I'm with Doug, except I think taxation in general is vile. It's theft.
Am I the only American left who really thinks we should slash about 95% of federal spending?
You'd think we could get a lot done with $200 billion (yes, 5% of the budget at this point is $200 freaking billion), but prospects for shrinking government at this point are so dim, it feels like talking about "if I could fly..."
Inheritance is for losers. Anyone defending their "right" to an inheritance is basically admitting that they can't cut it on their own. Tax it or let it be.
All the things that would enable one to "cut it on [one's] own" are just as inherited, whether through genes or culture.
I'm with Doug, except I think taxation in general is vile. It's theft.
No. It's robbery.
I am in favour of a high tax on inheritance. Either spend your earnings before you die or let the government use to pay off debt.
That's ridiculouly arbitrary. A person who dies at 55 is effectively taxed at twice the rate of someone who dies at 80 (and can therefore skip a generation in his bequeaths).
Either spend your earnings before you die or let the government use
If they're my earnings, what gives you the right to tell me how to spend them?
I'll give my money to anybody I damn well please.
You can try to stop me if you're feeling lucky.
Inheritance is for losers. Anyone defending their "right" to an inheritance is basically admitting that they can't cut it on their own.
You're full of shit. Anyone denying property rights is basically admitting to being a commie.
Estates were often accumulated through capital appreciation, which is already taxed lower than any other wealth-generating activity. Earned income is taxed at up to 35% (soon 39.6%), a rate that doesn't even include the 14% payroll tax. Cap gains are only 15% max (20% under Obama's plan). And you're saying these people should receive this money (taxed originally at only 15%) tax-free? Hissssssss.
It's not a question of "property rights." It's a question of how to equitably apportion the cost of government. Transfers in wealth are taxed, whether it's from my customer to me, or from me to my heirs, what's the difference?
And a question: why do we always refer to increases in taxation as ((New Tax Rate/Old Tax Rate)-100%), so that an increase of the cap gains rate from 15% to 20% is said to be a "33% increase" but an increase in the income tax rate from 35% to 39.6% is "only" a 13% increase?
Since the earned income is already getting taxed higher wouldn't it be fair to base it on the amount the government is "generously" allowing you to keep? Thus a marginal rate increase on earned income to 39.6% from 35% is worse than the increase on cap gains from 15% to 20% because the earned income is already getting soaked.
Mark said...
It's not a question of "property rights." It's a question of how to equitably apportion the cost of government. Transfers in wealth are taxed, whether it's from my customer to me, or from me to my heirs, what's the difference?
I don't mind the cost of government, I do mind that Obama and many other politicians want to raise taxes to pay welfare. That is my objection to any tax increase, even if I am in the wage earner category.
I can't believe it took Obama so long to figure out that cratering federal tax receipts wipes his entire agenda off the map. It really, and stunningly, seems as though he thought that the U.S. was some type of caste system where the 'permanently rich' would just sit there like good little sitting ducks, forking over some limitless stash of earnings every year regardless of the economy. P.S. Always get a huge kick out of lower and middle class people in this country who wear mediocrity and poverty as a badge of honor in a non fixed class society.
Post a Comment