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On July 20 2012 05:37 xDaunt wrote:Show nested quote +On July 20 2012 04:37 Defacer wrote:On July 20 2012 02:35 xDaunt wrote:On July 20 2012 02:19 paralleluniverse wrote:On July 20 2012 02:16 xDaunt wrote:
I can't take it anymore. I'll explain why what Obama said about "no one getting there on their own" is ridiculous and worthy of the ridicule that it is receiving. At best, it is a ludicrous strawman argument of the highest order. No one is arguing that the government has no role in providing basic infrastructure or that the basic infrastructure is unimportant. At worst, it demonstrates true antipathy towards fundamental American values.
For the life of me I don't understand how Obama could be stupid enough to go down this road. Elizabeth Warren already tried it out and got burned for it. This is an election where the economy is going to be the number one issue and there are already serious doubts about Obama's leadership on the economy. Obama's comments are precisely the type of thing that will drive voters away and sink him. I can't take it anymore. You've made 2 long paragraphs on Obama's statement, giving not a single reason why his statement is wrong. You may want to read a little bit closer. I'm not taking issue with the "factual accuracy" so much as the merits of the argument itself. I think you're reading way too much into some campaign trail hyperbole. All Obama seemed to be saying is that everyone benefits from the government, even so-called 'self-made' men and the extremely successful. He's just responding to the anti-government anti-tax hysteria that seems to have gripped the far right. I disagree. If all that Obama was saying was that everyone needs government to some degree for providing public goods and services, he very easily could have said as such without overtly (or accidentally, if you prefer) shitting on the accomplishments of entrepreneurs and others who have done well for themselves.
You actually think he hates small business owners? What he said makes perfect sense. I dont understand people that sensationalize things like you do. You hear something, then select a few words from the middle of it, take it out of context and just let your imagination run free. He has zero motive to "shit all over entrepeneurs" as you put it. This is like a witch hunt. Its so unbelievably ridiculous.
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On July 20 2012 05:37 xDaunt wrote:Show nested quote +On July 20 2012 04:37 Defacer wrote:On July 20 2012 02:35 xDaunt wrote:On July 20 2012 02:19 paralleluniverse wrote:On July 20 2012 02:16 xDaunt wrote:
I can't take it anymore. I'll explain why what Obama said about "no one getting there on their own" is ridiculous and worthy of the ridicule that it is receiving. At best, it is a ludicrous strawman argument of the highest order. No one is arguing that the government has no role in providing basic infrastructure or that the basic infrastructure is unimportant. At worst, it demonstrates true antipathy towards fundamental American values.
For the life of me I don't understand how Obama could be stupid enough to go down this road. Elizabeth Warren already tried it out and got burned for it. This is an election where the economy is going to be the number one issue and there are already serious doubts about Obama's leadership on the economy. Obama's comments are precisely the type of thing that will drive voters away and sink him. I can't take it anymore. You've made 2 long paragraphs on Obama's statement, giving not a single reason why his statement is wrong. You may want to read a little bit closer. I'm not taking issue with the "factual accuracy" so much as the merits of the argument itself. I think you're reading way too much into some campaign trail hyperbole. All Obama seemed to be saying is that everyone benefits from the government, even so-called 'self-made' men and the extremely successful. He's just responding to the anti-government anti-tax hysteria that seems to have gripped the far right. I disagree. If all that Obama was saying was that everyone needs government to some degree for providing public goods and services, he very easily could have said as such without overtly (or accidentally, if you prefer) shitting on the accomplishments of entrepreneurs and others who have done well for themselves.
He did not "[shit] on the accomplishments of entrepreneurs". That's what you want to read into what he said, instead of what he actually said.
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On July 20 2012 05:40 Velocirapture wrote:Show nested quote +On July 20 2012 05:13 JonnyBNoHo wrote:On July 20 2012 04:32 aksfjh wrote:On July 20 2012 03:07 JonnyBNoHo wrote:On July 20 2012 02:24 paralleluniverse wrote:On July 20 2012 01:59 JonnyBNoHo wrote:On July 19 2012 22:09 paralleluniverse wrote:On July 19 2012 09:37 JonnyBNoHo wrote:On July 19 2012 09:03 sunprince wrote:On July 18 2012 12:59 JonnyBNoHo wrote:
[quote]
No it's double taxation. The term is not misapplied either - you'll find it used in textbooks aplenty.
If I invest in a corporation by lending to it, the interest expense is 100% tax deductible for the corporation while taxed at ordinary income rates for the individual. Here the cash flow generated by the business is only taxed once - at the individual level.
If I invest in a corporation by buying shares, corporate profits are taxed. If I receive any cash from the corporation I have to pay dividend taxes. So here the same cash flow is taxed twice (corp profits and dividends).
Capital gains are a bit more squishy to show as double taxation since the only cash flow is at the investor level when an asset is bought and sold. However, the value of a firm is the sum of all future after tax cash flows (profits) discounted over time. So the value of the company already includes taxes. So when you tax cap gains you are taxing future expected profits (that will already be taxed). If that sounds too theoretical think of it this way - if it turns out that those future expected profits were imaginary the shares will fall to $0 - and the cap gain tax the government collected will be wiped out by cap losses. So cap gains only exist if profits exist - which are already taxed - and therefore double taxation exists. Try actually reading and responding to the points in the links I provided, instead of assuming I don't know what you're talking about. Your explanation is simply incorrect, for reasons that the links explain. Ok. First your blogspot article: As I said, I’ve heard it twice just this week where a conservative states unequivocally that a person who earns capital gains pays the 15% rate on top of any income tax rate. It’s not a straw man – it’s a very real misconception held by some conservatives. That would be a misconception - though I've never heard that one before. There is another double taxation argument that basically says the corporation has already paid its taxes on profits, and the price of my shares of stock reflect it. To then tax me on the increased value of my stock is a form of double taxation. There is truth in this argument, but it’s also a bit of a distraction.
As the individual shareholder I am not personally taxed twice. The corporation has paid its taxes and I pay my own capital gains tax. Yes, the value of my share is discounted based on the amount of corporate taxes paid, but I am not paying tax twice. The corporation, similarly, is not taxed twice. Not to mention, this argument only applies to capital gains earned through the purchase/sale of stock and would not apply to other capital gains like interest earned. Here's the problem: the taxation on the corporation does matter. If you own a small business as the sole owner as a sole proprietorship you ARE the business. The profit the business generates is your income and you pay taxes on it as your own income. The business itself pays no taxes. Corporations, on the other hand, are taxed themselves and any income that flows to the owner is taxed a second time as dividends. So two taxes on one stream of income (double taxation). The CTJ article makes 3 arguments: my replies follow.1) Some corporations pay no tax.This is irrelevant! The corporation pays the taxes it is supposed to. If you don't like the 'loophole' it uses then argue to close the loophole. 2) 2/3 of dividends are paid to tax-exempt entities. Another irrelevant argument! 3) Third, a capital gain from selling a corporate stock is not necessarily a form of corporate profit. Yes it is. As the CTJ article correctly points out the value can come from expected future profits. Therefore, and as I said in my previous response, the capital gain can only exist if the expected profits come true. And if they do, they will be taxed! This is a pointless semantics argument. Why does it matter that capital gains is "double tax"? Surely, the only thing that should matter is how much tax is paid and who pays it. And it seems that you've agreed to the argument that businesses shift the cost of their taxes onto the shareholders and customers. So how is it double taxation when businesses have shifted the burden of the tax onto others? You can't have it both ways. The cost of all taxes get shifted to some extent. Regardless, the point of the double taxation argument is that tax rates can appear lower than they really are. Since the argument about 'fair share' often revolves around effective tax rates the double taxation argument is used to illustrate that effective tax rates do not include all the explicit and implicit taxes that a taxpayer is paying. The same can be said about tax-exempt bonds where the tax is implicit. How can I shift my income tax onto you? The burden of the capital gains tax ultimately falls on people. Tax rates are lower than what they historically are, and I don't see how "double taxation" should come into the argument. What is of interest is how much tax does one have to pay, how much revenue is the government making, and is it good economics to increase/decrease taxes. A discussion of these 3 points doesn't need to refer to "double taxation". I admit I haven't read far back enough to see who brought the issue up in the first place. It is relevant to the first point "how much tax does one have to pay" because double taxation or implicit taxes make it *appear* that someone is paying a lower tax rate than the underlying economics dictate. That's the extent to which it matters. Tax shifting occurs not when the tax itself is shifted but when the underlying economic burden of the tax is shifted from one party to another. So when your taxes go up it is not only you that suffers, but everyone you would have done business with (but can't now) as well. I'm glad you pointed out that last paragraph, because that's also exactly how government spending works as well. So when the government collects that dollar in taxes and spends it on something else, it's benefiting more than that dollar. It's all about a tradeoff, and sometimes the economic activity from spending that dollar through the government is more than the activity lost by collecting that dollar. Yes, absolutely. You can certainly make the argument that raising taxes on capital gains (or anything else) is worth it because you'd rather the government have the money. My issue was with arguing that a certain person (Romney or the 1% in general) wasn't paying his 'fair share' largely because of a low tax rate on investments. It is my experience that most people who feel the top 1% are not paying their fair share see the progressive tax code, which the vast majority of us are beholden to, as the most fair system. This essentially means that at the end of the day, one way or another, we all need to be paying approximately our tax bracket percentage. For people like Romney this is close to 35% and he pays 13.9%. Now, understand that this is an emotional and focused view. Most middle class people I think understand that you have to create incentives for the rich to take risks (low capital gains taxes for example) but most see this as a deal with the devil and thus all the hate.
I completely understand that sentiment. But the public should be aware that the 13.9% rate is due to quirks in accounting rules and definitions and that the underlying economic reality is that Romney has paid a higher percent of his income in taxes than 13.9%.
The reality is that the last thing we want to do is encourage businesses to structure deals in such a way that a higher tax rate is paid while overall taxes paid are lower.
Ex. If I own an apartment complex that has appreciated in value I can cash out by either selling the property (and paying the capital gains tax) or refinance with a larger mortgage. Selling will mean more taxes paid but refinancing will show a higher tax rate.
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On July 19 2012 09:37 JonnyBNoHo wrote:Show nested quote +On July 19 2012 09:03 sunprince wrote:On July 18 2012 12:59 JonnyBNoHo wrote:No it's double taxation. The term is not misapplied either - you'll find it used in textbooks aplenty. If I invest in a corporation by lending to it, the interest expense is 100% tax deductible for the corporation while taxed at ordinary income rates for the individual. Here the cash flow generated by the business is only taxed once - at the individual level. If I invest in a corporation by buying shares, corporate profits are taxed. If I receive any cash from the corporation I have to pay dividend taxes. So here the same cash flow is taxed twice (corp profits and dividends). Capital gains are a bit more squishy to show as double taxation since the only cash flow is at the investor level when an asset is bought and sold. However, the value of a firm is the sum of all future after tax cash flows (profits) discounted over time. So the value of the company already includes taxes. So when you tax cap gains you are taxing future expected profits (that will already be taxed). If that sounds too theoretical think of it this way - if it turns out that those future expected profits were imaginary the shares will fall to $0 - and the cap gain tax the government collected will be wiped out by cap losses. So cap gains only exist if profits exist - which are already taxed - and therefore double taxation exists. Try actually reading and responding to the points in the links I provided, instead of assuming I don't know what you're talking about. Your explanation is simply incorrect, for reasons that the links explain. Ok. First your blogspot article: Show nested quote +As I said, I’ve heard it twice just this week where a conservative states unequivocally that a person who earns capital gains pays the 15% rate on top of any income tax rate. It’s not a straw man – it’s a very real misconception held by some conservatives. That would be a misconception - though I've never heard that one before. Show nested quote +There is another double taxation argument that basically says the corporation has already paid its taxes on profits, and the price of my shares of stock reflect it. To then tax me on the increased value of my stock is a form of double taxation. There is truth in this argument, but it’s also a bit of a distraction.
As the individual shareholder I am not personally taxed twice. The corporation has paid its taxes and I pay my own capital gains tax. Yes, the value of my share is discounted based on the amount of corporate taxes paid, but I am not paying tax twice. The corporation, similarly, is not taxed twice. Not to mention, this argument only applies to capital gains earned through the purchase/sale of stock and would not apply to other capital gains like interest earned. Here's the problem: the taxation on the corporation does matter. If you own a small business as the sole owner as a sole proprietorship you ARE the business. The profit the business generates is your income and you pay taxes on it as your own income. The business itself pays no taxes. Corporations, on the other hand, are taxed themselves and any income that flows to the owner is taxed a second time as dividends. So two taxes on one stream of income (double taxation).
When you sell a small business, you also pay taxes on the money you gain from the sale, the same way that you do when you sell stock. Are you suggesting that taxes on the sale of a business also constitute double taxation?
On July 19 2012 14:13 JonnyBNoHo wrote:Show nested quote +On July 19 2012 12:55 sunprince wrote:On July 19 2012 10:43 BluePanther wrote:On July 19 2012 09:03 sunprince wrote:On July 18 2012 12:59 JonnyBNoHo wrote:No it's double taxation. The term is not misapplied either - you'll find it used in textbooks aplenty. If I invest in a corporation by lending to it, the interest expense is 100% tax deductible for the corporation while taxed at ordinary income rates for the individual. Here the cash flow generated by the business is only taxed once - at the individual level. If I invest in a corporation by buying shares, corporate profits are taxed. If I receive any cash from the corporation I have to pay dividend taxes. So here the same cash flow is taxed twice (corp profits and dividends). Capital gains are a bit more squishy to show as double taxation since the only cash flow is at the investor level when an asset is bought and sold. However, the value of a firm is the sum of all future after tax cash flows (profits) discounted over time. So the value of the company already includes taxes. So when you tax cap gains you are taxing future expected profits (that will already be taxed). If that sounds too theoretical think of it this way - if it turns out that those future expected profits were imaginary the shares will fall to $0 - and the cap gain tax the government collected will be wiped out by cap losses. So cap gains only exist if profits exist - which are already taxed - and therefore double taxation exists. Try actually reading and responding to the points in the links I provided, instead of assuming I don't know what you're talking about. Your explanation is simply incorrect, for reasons that the links explain. You might want to re-read what he wrote. He's correct. It can be considered a double taxation if it's taxed at the corporate level and then taxed again at the personal level. He's not referring to double taxation of the same person, he's talking about double taxation of the same corporate income. Double taxation is the opposite of pass-through taxation. If there isn't pass-through taxation on the income, then there is double taxation. Essentially all money earned by investment in a C-Class corporation is subject to double taxations -- once at the corporate income level and once at the personal income level. (edit: also that heathen republican blog appears to misunderstand what double taxation is -- it's not the idea that personal income gets taxed twice at the personal level, but rather that personal taxes are imposed on something that was already taxed at the corporate level... the other cited article talks about a misunderstanding of double taxation. they are right that double taxation does not multiply to make the income rate 45% on the personal level, however that's not really what his argument was here) Let me put it this way, would you argue that sales tax is a form of double taxation? You could make that argument if you want to, sure. The point is that if you want to talk about who pays their 'fair share' you should talk about all the taxes they pay - both explicitly and implicitly. Otherwise you end up just talking about who pays their fair share of a particular tax which is an odd concept and has little to do with paying your fair share to society.
If that's the case, then there shouldn't be any problem with capital gains being a "double tax". However, since most people don't see sales taxes as a double tax, then it is fundamentally disingenous to argue that capital gains is a double tax while ignoring the massive number of other taxes that could be viewed as "double taxes" using the same argument.
The point I'm getting to is that 1% lobbyists use this "double tax" argument as a rhetorical tactic in order to convince people that capital gains taxes should be lower or non-existent. The fact is, this is bullshit, and we should follow the model you suggested of considering all taxes in order to fully understand whether people are paying their fair share.
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On July 20 2012 08:14 sunprince wrote:
When you sell a small business, you also pay taxes on the money you gain from the sale, the same way that you do when you sell stock. Are you suggesting that taxes on the sale of a business also constitute double taxation?
Just my two cents - it's not double taxation because the gain on sale would be counted as your income. Corporate taxes are double taxation because C corporations don't distribute all of their earnings to shareholders. It's part of the whole "corporations are people" thing.
But to complain about double taxation isn't a rhetorical device or bullshit. The real question is does the double taxation really discourage people from making investments? Most empirical evidence says no, investors are not motivated by tax savings.
The place where it hits hard is the hurdle rate for big financial institutions. When you raise capital gains taxes, lots of money from mutual funds or pension funds dry up because it makes it much harder for them to justify marginal investments that might not exceeed the return they need for clients.
This is a much more complicated issue than it first appears when you get into the dirty details. This is NOT a 1% vs 99% issue, which is one of the problems with the way modern finance has dispersed risk.
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On July 20 2012 09:13 coverpunch wrote:
But to complain about double taxation isn't a rhetorical device or bullshit. The real question is does the double taxation really discourage people from making investments? Most empirical evidence says no, investors are not motivated by tax savings.
Investors are not motivated by tax savings ? Let's eliminate the tax exempt status of municipal bonds, educational institutions, etc to test this "empirical evidence" coming straight out of your tail end. This is a big part of why "rich" people pay lower rates than their secretaries, however if you eliminate this feature, municipalities and educational institutions will have to raise even more $$ because the interest rates they have to pay for borrowing will immediately increase by over 200 basis points.
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United States9232 Posts
On July 20 2012 05:47 stk01001 wrote:Show nested quote +On July 20 2012 05:06 FabledIntegral wrote:On July 20 2012 04:19 paralleluniverse wrote:On July 20 2012 03:07 JonnyBNoHo wrote:On July 20 2012 02:24 paralleluniverse wrote:On July 20 2012 01:59 JonnyBNoHo wrote:On July 19 2012 22:09 paralleluniverse wrote:On July 19 2012 09:37 JonnyBNoHo wrote:On July 19 2012 09:03 sunprince wrote:On July 18 2012 12:59 JonnyBNoHo wrote:
[quote]
No it's double taxation. The term is not misapplied either - you'll find it used in textbooks aplenty.
If I invest in a corporation by lending to it, the interest expense is 100% tax deductible for the corporation while taxed at ordinary income rates for the individual. Here the cash flow generated by the business is only taxed once - at the individual level.
If I invest in a corporation by buying shares, corporate profits are taxed. If I receive any cash from the corporation I have to pay dividend taxes. So here the same cash flow is taxed twice (corp profits and dividends).
Capital gains are a bit more squishy to show as double taxation since the only cash flow is at the investor level when an asset is bought and sold. However, the value of a firm is the sum of all future after tax cash flows (profits) discounted over time. So the value of the company already includes taxes. So when you tax cap gains you are taxing future expected profits (that will already be taxed). If that sounds too theoretical think of it this way - if it turns out that those future expected profits were imaginary the shares will fall to $0 - and the cap gain tax the government collected will be wiped out by cap losses. So cap gains only exist if profits exist - which are already taxed - and therefore double taxation exists. Try actually reading and responding to the points in the links I provided, instead of assuming I don't know what you're talking about. Your explanation is simply incorrect, for reasons that the links explain. Ok. First your blogspot article: As I said, I’ve heard it twice just this week where a conservative states unequivocally that a person who earns capital gains pays the 15% rate on top of any income tax rate. It’s not a straw man – it’s a very real misconception held by some conservatives. That would be a misconception - though I've never heard that one before. There is another double taxation argument that basically says the corporation has already paid its taxes on profits, and the price of my shares of stock reflect it. To then tax me on the increased value of my stock is a form of double taxation. There is truth in this argument, but it’s also a bit of a distraction.
As the individual shareholder I am not personally taxed twice. The corporation has paid its taxes and I pay my own capital gains tax. Yes, the value of my share is discounted based on the amount of corporate taxes paid, but I am not paying tax twice. The corporation, similarly, is not taxed twice. Not to mention, this argument only applies to capital gains earned through the purchase/sale of stock and would not apply to other capital gains like interest earned. Here's the problem: the taxation on the corporation does matter. If you own a small business as the sole owner as a sole proprietorship you ARE the business. The profit the business generates is your income and you pay taxes on it as your own income. The business itself pays no taxes. Corporations, on the other hand, are taxed themselves and any income that flows to the owner is taxed a second time as dividends. So two taxes on one stream of income (double taxation). The CTJ article makes 3 arguments: my replies follow.1) Some corporations pay no tax.This is irrelevant! The corporation pays the taxes it is supposed to. If you don't like the 'loophole' it uses then argue to close the loophole. 2) 2/3 of dividends are paid to tax-exempt entities. Another irrelevant argument! 3) Third, a capital gain from selling a corporate stock is not necessarily a form of corporate profit. Yes it is. As the CTJ article correctly points out the value can come from expected future profits. Therefore, and as I said in my previous response, the capital gain can only exist if the expected profits come true. And if they do, they will be taxed! This is a pointless semantics argument. Why does it matter that capital gains is "double tax"? Surely, the only thing that should matter is how much tax is paid and who pays it. And it seems that you've agreed to the argument that businesses shift the cost of their taxes onto the shareholders and customers. So how is it double taxation when businesses have shifted the burden of the tax onto others? You can't have it both ways. The cost of all taxes get shifted to some extent. Regardless, the point of the double taxation argument is that tax rates can appear lower than they really are. Since the argument about 'fair share' often revolves around effective tax rates the double taxation argument is used to illustrate that effective tax rates do not include all the explicit and implicit taxes that a taxpayer is paying. The same can be said about tax-exempt bonds where the tax is implicit. How can I shift my income tax onto you? The burden of the capital gains tax ultimately falls on people. Tax rates are lower than what they historically are, and I don't see how "double taxation" should come into the argument. What is of interest is how much tax does one have to pay, how much revenue is the government making, and is it good economics to increase/decrease taxes. A discussion of these 3 points doesn't need to refer to "double taxation". I admit I haven't read far back enough to see who brought the issue up in the first place. It is relevant to the first point "how much tax does one have to pay" because double taxation or implicit taxes make it *appear* that someone is paying a lower tax rate than the underlying economics dictate. That's the extent to which it matters. Tax shifting occurs not when the tax itself is shifted but when the underlying economic burden of the tax is shifted from one party to another. So when your taxes go up it is not only you that suffers, but everyone you would have done business with (but can't now) as well. How much tax you pay in this case nominally is simply 15% of your capital gains, which can be compared with previous higher capital gain tax rates. What's the use of trying to work out how much you really pay, accounting for the hard/impossible to know tax shifting effect, unless you want to see how much more money you will have if capital gains tax is abolished? Capital gains tax isn't the only tax that has flow on effects, in fact, it's not the the only thing that has flow on effect. Basically everything has flow on effects. It's not "normally" 15%. It's 15% if you fall into particular criteria. If you are not within the particular criteria you do not qualify for that tax rate. Why do we have it like this? Because the criteria mandates your investment be in domestic companies - thus the money is used to spur the economy. You raise the tax rate and you thusly decrease investment in the U.S. economy (not specifically responding to you, especially since you aren't apparently in the U.S.). Almost all tax breaks or incentives exist so that investment gets pumped into the American economy rather than overseas. Actually, all long term capital gains are taxed at 15%, the only criteria is that it meets the definition of a "capital gain". There's already natural incentive to keep investments in the US because you have to pay both foreign and US tax on foreign investments,effectively getting double taxed. There are things that help offset this, like foreign tax credits, but the rules are complex (depending on the country) and it doesn't always work out ideally. The 15% rate is really designed to just help corporations and wealthy invidivuals to maximize their profits, it's not designed as an incentive to invest only domestically. The low rate is also there to help offset the risk of making investments, in that you can just as easily lose a ton of money, so you get rewarded for taking the risk with a lower tax rate. In a lot of situations when you make money from a foreign country and take that money into the US it's considered a dividend or ordinary income so it does get taxed at a different rate, but again if it's considered a long term capital gain the rate is 15%, period.
You're right, I was totally thinking of qualified dividends.
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It's very simple. Voteing for the one who will leave me alone and let me play my video games in peace-- GL Mitt.
I don't really like him or his party, but Obama is kind of a socialist, and keeps raising taxes (see his healthcare bill)
I want nothing to do with goverment, and hate goverment regulation- Obama is a regulator (see EPA).
Hope Obama loses, nice guy- but not good for this video gamer.
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On July 20 2012 09:22 Kaitlin wrote:Show nested quote +On July 20 2012 09:13 coverpunch wrote:
But to complain about double taxation isn't a rhetorical device or bullshit. The real question is does the double taxation really discourage people from making investments? Most empirical evidence says no, investors are not motivated by tax savings.
Investors are not motivated by tax savings ? Let's eliminate the tax exempt status of municipal bonds, educational institutions, etc to test this "empirical evidence" coming straight out of your tail end. This is a big part of why "rich" people pay lower rates than their secretaries, however if you eliminate this feature, municipalities and educational institutions will have to raise even more $$ because the interest rates they have to pay for borrowing will immediately increase by over 200 basis points.
If we taxed yields on muni bonds, it would be taxed as ordinary income because it's interest, not capital gains. If you buy and sell muni bonds right now, you have capital gains or losses. Jesus.
And the rest of your post isn't coherent but I'll answer anyways. What I meant is that taxes aren't a deciding factor when rich people decide to invest. If you raised capital gains taxes even to 70%, it's not like rich people would instead just stuff their mattresses with money. But what you change is where they invest.
To reiterate, the real problem wouldn't be rich people because some of them still like to take big risks (e.g. private equity, VCs). The bigger problem is that it shifts the analysis for institutional investors, who mostly get their funds from the 99% that have their savings in 401k's or mutual funds or pensions. Raising the capital gains tax may still be a desirable thing to do in the end but you have to factor in what effects it will have on those funds and the market.
To put it shortly, there are no easy answers on tax policy. Raising capital gains tax is not an obvious solution.
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On July 20 2012 10:06 SayGen wrote:
It's very simple. Voteing for the one who will leave me alone and let me play my video games in peace-- GL Mitt.
I don't really like him or his party, but Obama is kind of a socialist, and keeps raising taxes (see his healthcare bill)
I want nothing to do with goverment, and hate goverment regulation- Obama is a regulator (see EPA).
Hope Obama loses, nice guy- but not good for this video gamer.
Obama is not a socialist by any reasonable definition of the word. Not that there's anything wrong with that in my opinion. But Obama is simply not a socialist.
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On July 20 2012 10:43 DoubleReed wrote:Show nested quote +On July 20 2012 10:06 SayGen wrote:
It's very simple. Voteing for the one who will leave me alone and let me play my video games in peace-- GL Mitt.
I don't really like him or his party, but Obama is kind of a socialist, and keeps raising taxes (see his healthcare bill)
I want nothing to do with goverment, and hate goverment regulation- Obama is a regulator (see EPA).
Hope Obama loses, nice guy- but not good for this video gamer. Obama is not a socialist by any reasonable definition of the word. Not that there's anything wrong with that in my opinion. But Obama is simply not a socialist.
Socialism is achieved by punishing haves and taking away from them to give to the poor (robin hood effect) once the playing field is level you take away the capability to reobtain wealth (no private property) to create one overall poor class. Obama has done and said too many things that are unconstitutional- he also lied to me. He promised not to raise my taxes, but then did his healthcare thing.
Never before has an American been forced to buy a product on the condidtion of breathing.
Sure you have to have car insurance if you drive in America, but you don't HAVE to have a car.
I can't avoid his healthcare bill.
I'm tired of being lied to, I don't want to have to spend my precious time looking into politics, I just want to be left alone.
Mitt promises less government and less regulations. I'll give him a chance though from what the main stream media says- mitt can't win.
/shrug oh well rooting for the under dog is fine with me.
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![[image loading]](http://talkingpointsmemo.com/images/mandate-biggest-tax.png)
also - like HELL you can get by without a car. In most of the country you most definitively HAVE to have a car
if you don't want to bike an hour to the grocery anyway
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On July 20 2012 09:13 coverpunch wrote:Show nested quote +On July 20 2012 08:14 sunprince wrote:When you sell a small business, you also pay taxes on the money you gain from the sale, the same way that you do when you sell stock. Are you suggesting that taxes on the sale of a business also constitute double taxation?
Just my two cents - it's not double taxation because the gain on sale would be counted as your income. Corporate taxes are double taxation because C corporations don't distribute all of their earnings to shareholders. It's part of the whole "corporations are people" thing.
Small businesses don't distribute all of their earnings to the owner either. Some of that may used for expansion, capital investment, held as cash reserves, etc.
On July 20 2012 09:13 coverpunch wrote:
But to complain about double taxation isn't a rhetorical device or bullshit. The real question is does the double taxation really discourage people from making investments? Most empirical evidence says no, investors are not motivated by tax savings.
It is a bullshit rhetorical device, because it specifically relies on hypocritical arguments to demonize capital gains taxes as "wrong". It's a red herring and distraction from the real issues, such as the point you mention about how it affects investments. Don't get me wrong, I lean libertarian and I don't support massive capital gains taxes, but I'd much rather that we stick to legitimate arguments (how CGTs affect the economy) rather than dragging in rhetorical crap like this.
On July 20 2012 09:13 coverpunch wrote:
The place where it hits hard is the hurdle rate for big financial institutions. When you raise capital gains taxes, lots of money from mutual funds or pension funds dry up because it makes it much harder for them to justify marginal investments that might not exceeed the return they need for clients.
This effect is relatively marginal, because taxes only exist on actual gains and apply across the board for all sorts of investments (it's not like bank interest or other investments are tax exempt for the most part). Money for institutional investors won't dry out, as can be easily seen in European nations where capital gains taxes are far higher.
On July 20 2012 09:13 coverpunch wrote:This is a much more complicated issue than it first appears when you get into the dirty details. This is NOT a 1% vs 99% issue, which is one of the problems with the way modern finance has dispersed risk.
It's an issue where lobbyists on behalf of the 1% use disingenous tactics and misleading verbiage to win support for their interests from everyone else.
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a Lie is a lie.
Clinton lied. "I did not have sexual relations with that girl"
Bush lied and he was crucified about it. I couldn't even watch TV witohut hearing about it....
now Obama has lied.
3 presidents in a row have lied to us, and people still defend the liars.
I don't understand politics I guess. Shame an honest person can't run and win.
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On July 20 2012 10:43 DoubleReed wrote:Show nested quote +On July 20 2012 10:06 SayGen wrote:
It's very simple. Voteing for the one who will leave me alone and let me play my video games in peace-- GL Mitt.
I don't really like him or his party, but Obama is kind of a socialist, and keeps raising taxes (see his healthcare bill)
I want nothing to do with goverment, and hate goverment regulation- Obama is a regulator (see EPA).
Hope Obama loses, nice guy- but not good for this video gamer. Obama is not a socialist by any reasonable definition of the word. Not that there's anything wrong with that in my opinion. But Obama is simply not a socialist.
Really depends on how you define Socialism. The basic term means some state/government ownership over the means of production, but if we go by this definition, then technically every U.S. government official is a Socialistic (Including Romney)
If we go by the more mainstream definition, in which the government controls a majority of economic production, well then no, Obama obviously isn't a Socialist; neither is the Socialist Party of France for that matter. True Socialism died along time ago once people saw how inefficient it was.
What people need to realize is that Socialism=/=Welfare, and that's the crux of this whole Obama is a Socialist crap.
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On July 20 2012 10:23 coverpunch wrote:Show nested quote +On July 20 2012 09:22 Kaitlin wrote:On July 20 2012 09:13 coverpunch wrote:
But to complain about double taxation isn't a rhetorical device or bullshit. The real question is does the double taxation really discourage people from making investments? Most empirical evidence says no, investors are not motivated by tax savings.
Investors are not motivated by tax savings ? Let's eliminate the tax exempt status of municipal bonds, educational institutions, etc to test this "empirical evidence" coming straight out of your tail end. This is a big part of why "rich" people pay lower rates than their secretaries, however if you eliminate this feature, municipalities and educational institutions will have to raise even more $$ because the interest rates they have to pay for borrowing will immediately increase by over 200 basis points. If we taxed yields on muni bonds, it would be taxed as ordinary income because it's interest, not capital gains. If you buy and sell muni bonds right now, you have capital gains or losses. Jesus. And the rest of your post isn't coherent but I'll answer anyways. What I meant is that taxes aren't a deciding factor when rich people decide to invest. If you raised capital gains taxes even to 70%, it's not like rich people would instead just stuff their mattresses with money. But what you change is where they invest. To reiterate, the real problem wouldn't be rich people because some of them still like to take big risks (e.g. private equity, VCs). The bigger problem is that it shifts the analysis for institutional investors, who mostly get their funds from the 99% that have their savings in 401k's or mutual funds or pensions. Raising the capital gains tax may still be a desirable thing to do in the end but you have to factor in what effects it will have on those funds and the market. To put it shortly, there are no easy answers on tax policy. Raising capital gains tax is not an obvious solution.
Just because you can't read doesn't make the material not "coherent". I said nothing of capital gains. You commented about investors not being motivated by tax savings. My statement of the existence of tax exempt bonds clearly argues the opposite. These bonds pay lower interest rates than would be required if they were not tax exempt. The tax exempt nature is exactly whey they can get away with lower rates, and thus demonstrates that people do consider tax consequences in their investments.
Perhaps reading slower for better comprehension might help.
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On July 20 2012 10:43 DoubleReed wrote:Show nested quote +On July 20 2012 10:06 SayGen wrote:
It's very simple. Voteing for the one who will leave me alone and let me play my video games in peace-- GL Mitt.
I don't really like him or his party, but Obama is kind of a socialist, and keeps raising taxes (see his healthcare bill)
I want nothing to do with goverment, and hate goverment regulation- Obama is a regulator (see EPA).
Hope Obama loses, nice guy- but not good for this video gamer. Obama is not a socialist by any reasonable definition of the word. Not that there's anything wrong with that in my opinion. But Obama is simply not a socialist.
Not to derail but yes there is. If you can't gain anything from work you wouldn't work.
You give people an incentive/moticvation and they will act.
no motivation/incentive no action.
I may not know much about politics, but I know that socialism doesn't work and can't compete economically with capitalism. I did pay some attention in History class when the cold war was explained.
EDIT: Can to Can't
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On July 20 2012 10:49 SayGen wrote:Show nested quote +On July 20 2012 10:43 DoubleReed wrote:On July 20 2012 10:06 SayGen wrote:
It's very simple. Voteing for the one who will leave me alone and let me play my video games in peace-- GL Mitt.
I don't really like him or his party, but Obama is kind of a socialist, and keeps raising taxes (see his healthcare bill)
I want nothing to do with goverment, and hate goverment regulation- Obama is a regulator (see EPA).
Hope Obama loses, nice guy- but not good for this video gamer. Obama is not a socialist by any reasonable definition of the word. Not that there's anything wrong with that in my opinion. But Obama is simply not a socialist. Socialism is achieved by punishing haves and taking away from them to give to the poor (robin hood effect) once the playing field is level you take away the capability to reobtain wealth (no private property) to create one overall poor class. Obama has done and said too many things that are unconstitutional- he also lied to me. He promised not to raise my taxes, but then did his healthcare thing. Never before has an American been forced to buy a product on the condidtion of breathing. Sure you have to have car insurance if you drive in America, but you don't HAVE to have a car. I can't avoid his healthcare bill. I'm tired of being lied to, I don't want to have to spend my precious time looking into politics, I just want to be left alone. Mitt promises less government and less regulations. I'll give him a chance though from what the main stream media says- mitt can't win. /shrug oh well rooting for the under dog is fine with me.
So you just defined socialism as something Obama is not doing. Great. So I guess you agree that Obama is not a socialist, because he hasn't done those things.
And to be fair, Obama openly said it was a penalty, not a tax...
Being forced to buy a product that you will use regardless whether or not you pay for it is really not that unfair. I'm not quite sure why people think it is. There is a reason you have to have car insurance if you have a car.
On July 20 2012 11:16 SayGen wrote:Show nested quote +On July 20 2012 10:43 DoubleReed wrote:On July 20 2012 10:06 SayGen wrote:
It's very simple. Voteing for the one who will leave me alone and let me play my video games in peace-- GL Mitt.
I don't really like him or his party, but Obama is kind of a socialist, and keeps raising taxes (see his healthcare bill)
I want nothing to do with goverment, and hate goverment regulation- Obama is a regulator (see EPA).
Hope Obama loses, nice guy- but not good for this video gamer. Obama is not a socialist by any reasonable definition of the word. Not that there's anything wrong with that in my opinion. But Obama is simply not a socialist. Not to derail but yes there is. If you can't gain anything from work you wouldn't work. You give people an incentive/moticvation and they will act. no motivation/incentive no action. I may not know much about politics, but I know that socialism doesn't work and can't compete economically with capitalism. I did pay some attention in History class when the cold war was explained. EDIT: Can to Can't
Yes and you clearly don't know much about socialism. Socialism =/= Communism.
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On July 20 2012 10:54 tso wrote:+ Show Spoiler +also - like HELL you can get by without a car. In most of the country you most definitively HAVE to have a car if you don't want to bike an hour to the grocery anyway
In well designed communities and cities, then a car is not needed. I live in Portland, you absolutely don't need a car here, the public transportation is great, and things are within walking distance or bus distance, or subway. A friend lives in the bay area for more than 8 years(she also lived in NY for a year during this time, no car), on her own, no car. She bikes or takes the Bart system.
Having to use a car just means you live in the middle of nowhere or in a very very poorly designed city. Las Vegas for instance, you need a freaking car. Or your in a suburb and need to commute to work, completely understandable. Otherwise a car is just something for convenience and luxury and not from necessity.
Silly to argue this, I'm just in a bad mood I guess lol, but I agree with you, the guy who posted that this healthcare thing is the only thing mandatory, what an awful post and awful reasoning.
Also more discussion on socialism, I give up on the term socialism, has been misused and thrown all over the place.
I consider myself a socialist, and yet people are calling Obama a socialist? What the hell does that make me then, so extreme left that I might fall of the face of the planet cause it is flat?? I mean freaking Mitt Romeny passed healthcare for his state, does that make him a socialist? I don't understand what this word means anymore, it's been thrown around and every democrat is being accused of it, yet only rep. I can find that ever identified as it is Bernie Sanders?
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On July 20 2012 08:14 sunprince wrote:
If that's the case, then there shouldn't be any problem with capital gains being a "double tax". However, since most people don't see sales taxes as a double tax, then it is fundamentally disingenous to argue that capital gains is a double tax while ignoring the massive number of other taxes that could be viewed as "double taxes" using the same argument.
The point I'm getting to is that 1% lobbyists use this "double tax" argument as a rhetorical tactic in order to convince people that capital gains taxes should be lower or non-existent. The fact is, this is bullshit, and we should follow the model you suggested of considering all taxes in order to fully understand whether people are paying their fair share.
The sales tax argument is irrelevant to whether nor not a capital gain is a double tax since any money received from the capital gain will still be subject to a sales tax if spent. "Double tax" is not something lobbyists imagined up!
Like I said at the start it's hard to see capital gains as double taxation but do we at least agree that dividends are double taxed?
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EPT
