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KCMax
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Politics

Postby KCMax » Fri Dec 21, 2012 10:57 am

So President Obama offers what many think is a pretty fair deal for Republicans - tax rates for those making $400k go back to Clinton-era levels, everyone else gets the Bush tax cuts forever. He has put entitlement cuts on the table (much to the chagrin of some liberals). And Boehner counters with a tax increase only for millionaires that had no chance of passing the Senate much less being approved by President Obama - and even THAT fails to get a majority of support among Republicans enough to garner a vote because its a tax increase.

The GOP is in full implosion mode. A majority of Americans now feel the GOP is too extreme, and should concede more than the Dems on the fiscal cliff. Boehner looks utterly powerless. And now I'd expect Obama to be working to peel off moderates to get his plan approved.

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Re: 2012 Election

Postby Highlander » Fri Dec 21, 2012 11:16 am

KCMax wrote:So President Obama offers what many think is a pretty fair deal for Republicans - tax rates for those making $400k go back to Clinton-era levels, everyone else gets the Bush tax cuts forever. He has put entitlement cuts on the table (much to the chagrin of some liberals). And Boehner counters with a tax increase only for millionaires that had no chance of passing the Senate much less being approved by President Obama - and even THAT fails to get a majority of support among Republicans enough to garner a vote because its a tax increase.

The GOP is in full implosion mode. A majority of Americans now feel the GOP is too extreme, and should concede more than the Dems on the fiscal cliff. Boehner looks utterly powerless. And now I'd expect Obama to be working to peel off moderates to get his plan approved.


All I wanted was the 250,000 limit raised to something more reasonable (like $400,000) to reflect the reality of what wealth is and isn't nowadays - making 250,000$ per year does not make one anything close to wealthy. I'd also like to see a more graduated progression rather than lumping everyone together that makes over a certain threshold. There's a big difference between $250,000 and $2 million per year.

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Re: 2012 Election

Postby grovester » Fri Dec 21, 2012 12:16 pm

Everybody's first 250k is taxed the same. If you made 350k, you'd pay at worst another 3 grand in taxes. While a person may not feel "wealthy" I'd imagine they could afford to pay it.

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Re: 2012 Election

Postby bobbyhawks » Fri Dec 21, 2012 12:22 pm

Highlander wrote:
KCMax wrote:So President Obama offers what many think is a pretty fair deal for Republicans - tax rates for those making $400k go back to Clinton-era levels, everyone else gets the Bush tax cuts forever. He has put entitlement cuts on the table (much to the chagrin of some liberals). And Boehner counters with a tax increase only for millionaires that had no chance of passing the Senate much less being approved by President Obama - and even THAT fails to get a majority of support among Republicans enough to garner a vote because its a tax increase.

The GOP is in full implosion mode. A majority of Americans now feel the GOP is too extreme, and should concede more than the Dems on the fiscal cliff. Boehner looks utterly powerless. And now I'd expect Obama to be working to peel off moderates to get his plan approved.


All I wanted was the 250,000 limit raised to something more reasonable (like $400,000) to reflect the reality of what wealth is and isn't nowadays - making 250,000$ per year does not make one anything close to wealthy. I'd also like to see a more graduated progression rather than lumping everyone together that makes over a certain threshold. There's a big difference between $250,000 and $2 million per year.


I'd like people to stop classifying things as "wealthy" and "not wealthy." A "wealthy" person can clearly afford to pay more taxes, but so can some more well off people that nobody would consider to be "wealthy." To me, wealthy is hardly defined by income, but rather how much you are worth. Someone can make $1 million in a year and be worth $100k at the end of it. Someone can make $100k and be worth $10 million at the end of that year. Granted, there is no easy way to do it, but I would like for tax brackets to be defined by net worth. This would result in another level of money sheltering and off-shoring, but it is a way to not penalize the small businesses or newly successful as much as those sitting on stockpiles of inherited money earning capital gains in a privately managed equity fund. It actually would incentivize people to spend their money to fall below certain thresholds, which would in turn stimulate the economy. I don't in any way think that making $250k a year makes one "wealthy," but I do think that most people can afford to pay an incrementally higher rate above that number.

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Re: 2012 Election

Postby chrizow » Fri Dec 21, 2012 12:24 pm

a household income of $250K a year puts you in the top 2-3% in the US. in my opinion, that should be considered "wealthy." not hedge fund-manager wealthy, but wealthy. median household income in the US in 2011 was $49K per year.

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Re: 2012 Election

Postby Highlander » Fri Dec 21, 2012 12:32 pm

bobbyhawks wrote:
Highlander wrote:
KCMax wrote:So President Obama offers what many think is a pretty fair deal for Republicans - tax rates for those making $400k go back to Clinton-era levels, everyone else gets the Bush tax cuts forever. He has put entitlement cuts on the table (much to the chagrin of some liberals). And Boehner counters with a tax increase only for millionaires that had no chance of passing the Senate much less being approved by President Obama - and even THAT fails to get a majority of support among Republicans enough to garner a vote because its a tax increase.

The GOP is in full implosion mode. A majority of Americans now feel the GOP is too extreme, and should concede more than the Dems on the fiscal cliff. Boehner looks utterly powerless. And now I'd expect Obama to be working to peel off moderates to get his plan approved.


All I wanted was the 250,000 limit raised to something more reasonable (like $400,000) to reflect the reality of what wealth is and isn't nowadays - making 250,000$ per year does not make one anything close to wealthy. I'd also like to see a more graduated progression rather than lumping everyone together that makes over a certain threshold. There's a big difference between $250,000 and $2 million per year.


I'd like people to stop classifying things as "wealthy" and "not wealthy." A "wealthy" person can clearly afford to pay more taxes, but so can some more well off people that nobody would consider to be "wealthy." To me, wealthy is hardly defined by income, but rather how much you are worth. Someone can make $1 million in a year and be worth $100k at the end of it. Someone can make $100k and be worth $10 million at the end of that year. Granted, there is no easy way to do it, but I would like for tax brackets to be defined by net worth. This would result in another level of money sheltering and off-shoring, but it is a way to not penalize the small businesses or newly successful as much as those sitting on stockpiles of inherited money earning capital gains in a privately managed equity fund. It actually would incentivize people to spend their money to fall below certain thresholds, which would in turn stimulate the economy. I don't in any way think that making $250k a year makes one "wealthy," but I do think that most people can afford to pay an incrementally higher rate above that number.


You'd have to include age in that equation. At 55, I don't want to spend my money. I want to save it for retirement so I am not a burden on my children and even yourself. That's why I hate, as much as you do, the categorization of people as wealthy or non wealthy. Making $250k at 55 is a lot less "wealthy" than making $250k at 35 with many years of earning to come. Making $250 k is much less wealthy than someone making $5 million yet the administration wants to throw all these people in the same bucket with a rather whopping 39% income tax. Even if you make over about $150k per year, you are already getting hit by not being eligible for many tax deductions people under that amount have available to them. I believe college tuition is one of those deductions - and it's significant.

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Re: 2012 Election

Postby lock+load » Fri Dec 21, 2012 12:37 pm

Highlander wrote:You'd have to include age in that equation. At 55, I don't want to spend my money. I want to save it for retirement so I am not a burden on my children and even yourself. That's why I hate, as much as you do, the categorization of people as wealthy or non wealthy. Making $250k at 55 is a lot less "wealthy" than making $250k at 35 with many years of earning to come. Making $250 k is much less wealthy than someone making $5 million yet the administration wants to throw all these people in the same bucket with a rather whopping 39% income tax. Even if you make over about $150k per year, you are already getting hit by not being eligible for many tax deductions people under that amount have available to them. I believe college tuition is one of those deductions - and it's significant.


$250k a year is weathly at any age. It may not seem like it to you, but $250k so dwarfs what most americans will ever earn in a year. I completely understand how it doesn't "feel" wealthy, but try living on $49k for a year and I think your perspective will change fast.

I agree that it is absurd that the marginal rates top out at a relatively low amount. I'd like to see a return to the pre-Reagan rate structure with a lot more brackets and rates continuing to increase into the millions of income.

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Re: 2012 Election

Postby Highlander » Fri Dec 21, 2012 1:01 pm

grovester wrote:Everybody's first 250k is taxed the same. If you made 350k, you'd pay at worst another 3 grand in taxes. While a person may not feel "wealthy" I'd imagine they could afford to pay it.


That extra hundred grand would cost one 6k more, not 3k. $39000 vs 33000. The current highest tax rate is 35% but it doesn't kick in until 350,000. What has been proposed is 39% on everything over 250,000. It's too high whether you think 250k is wealthy or not.

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Re: 2012 Election

Postby grovester » Fri Dec 21, 2012 1:04 pm

The math has to work, that's where the 250k number come from. Trust me, if they could make the math work while only raising taxes on millionaires, they would have.

PS, my mistake on the rates, I was thinking 36 to 39. The point remains though, people making 350k can afford it.

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Re: 2012 Election

Postby Highlander » Fri Dec 21, 2012 2:00 pm

grovester wrote:The math has to work, that's where the 250k number come from. Trust me, if they could make the math work while only raising taxes on millionaires, they would have.

PS, my mistake on the rates, I was thinking 36 to 39. The point remains though, people making 350k can afford it.


Well. In 5 minutes, I'm off to KC to contribute liberally to the KC economy. I'll worry about taxes when I get back.

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Re: 2012 Election

Postby grovester » Fri Dec 21, 2012 2:05 pm

Enjoy your Nutcracker, Highlander!

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Re: 2012 Election

Postby aknowledgeableperson » Fri Dec 28, 2012 8:39 am

How far are we going to go as we fall down the fiscal cliff? Deal agreed to and signed before Tuesday? Which side wins?

I think no deal. If there is a deal the income tax increase is only above $1M.

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Re: 2012 Election

Postby knucklehead » Fri Dec 28, 2012 9:54 am

It is not clear that republicans in the house can agree to any deal.

The republicans hold a majority of the seats in the house, even though more people voted for a democratic house candadate than a republican candadate.

How does that happen? Gerrymandering at state legislature level, where people tend to vote republican more for some unknown reason. Since most people are not able to even name their state house representatative or state senator, elections at that level seem to be pretty much on auto pilot.

The problem is that the house districts are so polarized politically, that the biggest threat facing a house republican is a primary threat from the right.

In republican primaries, the true wackos are a majority. The GOP house members are scared to vote for anything that could be called a tax increase.

So the Bush tax cuts have to expire before they can vote for anything reasonable. Then they can vote for a tax cut for the middle class and say they tried to pass a tax cut for the wealthy but the stinking democrats would not go along.

Even then, the republicans may be so wacked out they try to throw a wrench in the deal by grandstanding on the debt limit increase. It would be a huge mistake nationally for the republicans. But why the heck would the GOP house members care? It would help them in their own primaries and they basically are only in it for themselves. They are probably willing to sell out future GOP presidential candadates to help their own chances of withstand a primary challenge from the right.

On the other point, if you make $250,000 a year you are rich. When I lived in Martin City, I went to my local VFW every friday night. People at that level view everyone living in a $300,000 house as rich. Here is a general rule, if your house has more bathrooms than people living in the house, you are rich. It is amazing how out of touch some suburbinates are with how average people think. Who the heck do you think lives in all those smaller 1950s era houses you see around town in the older inner ring suburbs? If you live in a house worth $80 K, of course you think people living in $300 K houses are rich.
Last edited by knucklehead on Fri Dec 28, 2012 10:02 am, edited 1 time in total.

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Re: 2012 Election

Postby beautyfromashes » Fri Dec 28, 2012 11:20 am

lock+load wrote:$250k a year is weathly at any age. It may not seem like it to you, but $250k so dwarfs what most americans will ever earn in a year. I completely understand how it doesn't "feel" wealthy, but try living on $49k for a year and I think your perspective will change fast.

Say a person starts a business and the first two years they lose their shirt, take money out of their retirement fund to get it started paying the huge penalty all in the name of 'the American Way'. Then, in year 3, they finally start to take off and make $250K for the year because they busted their butt, worked long hours and put everything they had into turning the business around. You want to tax them high on that 3rd year? Entrepenuer business owners very rarely have a linear income. Some years you make very little and then the next you do well. It's the incentive of doing something for yourself and making it big that causes people to start businesses. And now we want to disencentivize that by sticking small business owners with increased taxes?

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Re: 2012 Election

Postby beautyfromashes » Fri Dec 28, 2012 11:21 am

lock+load wrote:$250k a year is weathly at any age. It may not seem like it to you, but $250k so dwarfs what most americans will ever earn in a year. I completely understand how it doesn't "feel" wealthy, but try living on $49k for a year and I think your perspective will change fast.

Say a person starts a business and the first two years they lose their shirt, take money out of their retirement fund to get it started paying the huge penalty all in the name of 'the American Way'. Then, in year 3, they finally start to take off and make over $250K for the year because they busted their butt, worked long hours and put everything they had into turning the business around. You want to tax them high on that 3rd year? Entrepenuer business owners very rarely have a linear income. Some years you make very little and then the next you do well. It's the incentive of doing something for yourself and making it big that causes people to start businesses. And now we want to disencentivize that by sticking small business owners with increased taxes?
Last edited by beautyfromashes on Fri Dec 28, 2012 11:24 am, edited 1 time in total.

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Re: 2012 Election

Postby grovester » Fri Dec 28, 2012 11:21 am

aknowledgeableperson wrote:How far are we going to go as we fall down the fiscal cliff? Deal agreed to and signed before Tuesday? Which side wins?

I think no deal. If there is a deal the income tax increase is only above $1M.


If a deal is made, I don't see the tax threshold going much over 500k. The Dems have all the leverage and the math breaks down the higher it goes. They might go to 600 but only with serious concessions about future debt limit increases.

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Re: 2012 Election

Postby grovester » Fri Dec 28, 2012 11:23 am

beautyfromashes wrote:
lock+load wrote:$250k a year is weathly at any age. It may not seem like it to you, but $250k so dwarfs what most americans will ever earn in a year. I completely understand how it doesn't "feel" wealthy, but try living on $49k for a year and I think your perspective will change fast.

Say a person starts a business and the first two years they lose their shirt, take money out of their retirement fund to get it started paying the huge penalty all in the name of 'the American Way'. Then, in year 3, they finally start to take off and make $250K for the year because they busted their butt, worked long hours and put everything they had into turning the business around. You want to tax them high on that 3rd year? Entrepenuer business owners very rarely have a linear income. Some years you make very little and then the next you do well. It's the incentive of doing something for yourself and making it big that causes people to start businesses. And now we want to disencentivize that by sticking small business owners with increased taxes?


If they make 250k, they're taxes won't change at all. If they make 260k they will pay 4% more on 10k.

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Re: 2012 Election

Postby beautyfromashes » Fri Dec 28, 2012 11:31 am

grovester wrote:
beautyfromashes wrote:
lock+load wrote:$250k a year is weathly at any age. It may not seem like it to you, but $250k so dwarfs what most americans will ever earn in a year. I completely understand how it doesn't "feel" wealthy, but try living on $49k for a year and I think your perspective will change fast.

Say a person starts a business and the first two years they lose their shirt, take money out of their retirement fund to get it started paying the huge penalty all in the name of 'the American Way'. Then, in year 3, they finally start to take off and make $250K for the year because they busted their butt, worked long hours and put everything they had into turning the business around. You want to tax them high on that 3rd year? Entrepenuer business owners very rarely have a linear income. Some years you make very little and then the next you do well. It's the incentive of doing something for yourself and making it big that causes people to start businesses. And now we want to disencentivize that by sticking small business owners with increased taxes?


If they make 250k, they're taxes won't change at all. If they make 260k they will pay 4% more on 10k.


Who should pay more in taxes?

Person1:Entrepenuer business owner took out $500K from their IRA with a 20% penalty to start a business in New York City.
yr1- $60K
yr2- $60K
yr3- $300K

Person2: Upper level accountant in Dallas.
yr 1- $160k
yr 2- $160k
yr 3- $160K

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Re: 2012 Election

Postby lock+load » Fri Dec 28, 2012 11:37 am

beautyfromashes wrote:Say a person starts a business and the first two years they lose their shirt, take money out of their retirement fund to get it started paying the huge penalty all in the name of 'the American Way'. Then, in year 3, they finally start to take off and make over $250K for the year because they busted their butt, worked long hours and put everything they had into turning the business around. You want to tax them high on that 3rd year? Entrepenuer business owners very rarely have a linear income. Some years you make very little and then the next you do well. It's the incentive of doing something for yourself and making it big that causes people to start businesses. And now we want to disencentivize that by sticking small business owners with increased taxes?


The circumstance where a particular individual has uneven income year to year is not a good reason to have lower marginal tax rates at any particular income level. If this is truly an issue, income averaging needs to be incorporated into the tax code, not lower marginal rates.

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Re: 2012 Election

Postby beautyfromashes » Fri Dec 28, 2012 11:44 am

Here's what should happen:
Republicans agree to the Presidents tax increase plan in exchange for a balanced budget amendment.


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