US Politics Mega-thread - Page 1011

On April 23 2014 06:38 RvB wrote:

The household debt service ratio is low because of the incredibly low interest rates as well. There might be problems when interest rates start rising again, although on the other hand they'll start rising only when there's less unemployment.

On April 19 2014 05:47 JonnyBNoHo wrote:

Posted before. Not bullshitting. + Show Spoiler +

On April 23 2014 08:00 IgnE wrote:


So the graph you posted from that report is misleading in a number of ways, foremost among them being that this is an "ideal" case where the income is a family income for a number of dependents wherein the family qualifies for all of the various programs that the graph is taking into account (SNAP, CHIP, Section 8, Medicaid, Temporary Assistance for Needy Families, etc.). Considering that in 2007 only ~6% of people who were married were living below the poverty line, we can assume that perhaps a majority of people working at Walmart don't qualify for most of these benefits. Another significant plurality, if not majority, do not have kids, and so do not qualify for more of those benefits.

When you factor in how many people who are eligible for such programs don't enroll, you are looking at even fewer people reaping in all the extra disposable income that you are arguing all of these sub-$10 wage earners at Walmart are raking in. The report itself says in the opening paragraphs that "the majority of lower-income families do not receive means-tested transfers, either because they do not meet additional, nonfinancial eligibility requirements or because they are eligible but do not apply for benefits. Of those who receive transfers, the majority participate in only one program." The report goes on to state that only about 21% of taxpayers who were eligible in a sample of tax returns received SNAP benefits. On page 20 of 53, the report states that only 38% of families with income under 250% of poverty level participated in one or more programs, and that the majority only participated in one program. Figures 5 and 6 on pages 32 and 33 of 53 are much more meaningful graphs of marginal tax rates, showing that only the 90th percentile of low-income families, which includes huge families who don't make very much money, and perhaps are hit doubly by payroll taxes with two earners, hit marginal tax rates above 60%.

You said that the marginal tax rates in the income ranges we were discussing approaches 100%. The report explicitly finds that the effective marginal tax rate for most people who would be affected by the proposed wage increase is between 30 and 35%. You posted this misleading graph either without reading the report or deliberately omitting its findings. You argued that raising the wages of Walmart employees was a regressive tax of ~1.4% on customers and wouldn't materially benefit those working there because the marginal tax rate was approaching 100%. That is complete bullshit. Even if the effective marginal tax rage

On April 23 2014 09:47 IgnE wrote:
30% is vastly different from 100%. The proposition was to increase the median wage at Walmart to around at least $12. Framing the discussion by citing a 100% marginal tax rate for the "needy" is just outright mendacious.

Currently the marginal tax rate including benefit cuts is close to 100%.

On April 23 2014 10:35 IgnE wrote:
Except it's not close to 100%. Even the 90th percentile of people who receive benefits only pay a ~60% marginal tax. Unless you are talking about the rara avis who stacks every benefit loss and every tax increase into one package. But that would be like talking about a black swan.

The simulated marginal tax rates include the combined effects of federal individual income taxes, state individual income taxes (under provisions in effect in 2006), federal payroll taxes, and the reduction in SNAP benefits. The marginal tax rates were based on taxpayers’ total compensation before their employers’ share of payroll taxes was deducted.

including additional programs would generally increase estimates of marginal
tax rates.

On April 23 2014 10:54 JonnyBNoHo wrote:



Hardly an exhaustive list of benefits. Also:
Other parts of the report that include more / other benefits do approach 100%.

On April 23 2014 11:16 IgnE wrote:


Ok but you didn't post the graph where they only included SNAP. That graph looks different from the one you posted. If you had looked deeper you would see the more widely cited 30% and the overall conclusion that most people pay roughly 30% marginal tax at that income.

Other parts of the report include more/other benefits that reach up to 60%, and mention in passing that benefits can approach 100% before going into analysis that for the large majority of people 100% marginal tax is not a reality. I do not understand why you persist in this. Just look at the summary on page 1.

Edit: It's kind of enraging that you paste an out-of-context quote unrelated to the graph and then say that they only counted SNAP benefits. They did a number of simulations, including ones where they only counted SNAP benefits. The graph you posted uses all of the programs that I cited earlier. Talking with you is like pulling teeth. I can't tell if you are just profoundly stupid or merely disingenuous.

The Congressional Budget Office (CBO) finds that
working taxpayers with income below 450 percent of federal poverty guidelines (commonly known as the federal
poverty level, so abbreviated as FPL) face a marginal tax rate of 30 percent, on average, under the provisions of
law in effect in 2012. That estimate takes into account federal and state individual income taxes, federal
payroll taxes, and the reductions in benefits from the Supplemental Nutrition Assistance Program (SNAP,
formerly known as the Food Stamp program) that occur when earnings increase.

On April 23 2014 11:40 JonnyBNoHo wrote:

The graph I first posted included more programs and went nearly up to 100% marginal tax rate. The graph I used was consistent with my message.

The data you cited "Even the 90th percentile of people who receive benefits only pay a ~60% marginal tax" only included the SNAP benefits.

The 30% number from the summary is an average including people that make up to 450% of the poverty line - well beyond struggling cashier at Walmart - and only included SNAP benefits.
Edit: Removed the insult

On April 23 2014 12:05 IgnE wrote:


Since the vast majority of people receive benefits from one or no programs and since SNAP is a high-cost benefit, the SNAP analysis is a good proxy for reality. Looking through most of the data, the ~30% rate is roughly accurate for everyone up to 450% of poverty, although it does approach 50% for some benefits users. 50% is still very different from 100%. You must have also ignored the part where they said increasing marginal tax rates have no perceptible impact on young males' willingness to work more (or seek higher wages).

On April 23 2014 12:33 JonnyBNoHo wrote:

One or no programs given what the CBO was looking at (not all programs). I was also commenting on people who are using benefits, not all Walmart employees or all minimum wage earners.

Disincentives to work are a different topic. Why wouldn't I ignore it?

Edit: CBO also used self-reported data that, according to them, under-reported program use. They also point out that people with children are more likely to use multiple programs.

On a friendly note, as I said at the start, I do think you brought up some good points. 100% marginal tax rate was a bit of hyperbole, even if they can go that high (or higher!) on occasion and tend to be higher for the more needy.

Albuquerque police said an officer shot and killed an auto theft suspect early Monday, the third shooting by officers in the troubled department in just over a month and the first after a federal investigation faulted the department for excessive force and a culture of abuse and aggression.

Gordon Eden, police chief of the New Mexico city, said the shooting occurred Monday morning during a chase.

"An officer pursued on foot when the suspect stopped, turned and pointed a handgun at close range," Eden said.

Police identified the woman as Mary Hawkes, the daughter of Danny Hawkes, a retired magistrate judge in Valencia County, south of Albuquerque.

Court records show Mary Hawkes had two previous run-ins with the law as an adult, one for drinking in public and another for shoplifting, according to the Albuquerque Journal. As a juvenile, she was charged in 2011 with attempted criminal sexual contact of a child under 13. She was convicted of a lesser battery offense and sentenced to two years of probation.

No further details about the shooting were immediately available. Phone calls and e-mails to the Albuquerque Police Department were not returned.

On April 23 2014 15:36 Danglars wrote:
"Corporate welfare?" What is that?

On April 23 2014 16:58 Danglars wrote:
It's been previously mentioned on this same page. Do you care to comment on the remaining question?

On April 23 2014 06:46 JonnyBNoHo wrote:

Employers increase insurance payments by ~$6K, employees by ~$2.5K. That's a net increase to workers even accounting for their greater premium outlays.

I don't see what profits have to do with my point about non-cash benefits. Regardless, your graph doesn't say it's in real terms, and it shows profits up something like 2.5X, not 25X. Additionally profits are cyclical, affected by both international and domestic markets and interest rates. Profits at a high today doesn't mean that they'll be higher tomorrow!


Not sure what your problem with the graph is. Debt service ratio is around a 30 year low - that's very substantial.