Democrats & Liberals Archives

Penny-wise, Pound-Foolish

Matthew Yglesias passes on an excellent point on this debate. It seems like Republicans and conservative Democrats were willing to give 75 billion dollars a year, to a tune of three-quarters of a trillion dollars, to ensure that Rich folks could leave all of their money to their children without federal estate taxes. But spend less than thirty billion dollars a year to give everybody healthcare? That we can’t afford.

This won't be a long entry, so let me just make my point quickly: The Rich folks in America don't need our help. They'll have the best healthcare, the best lawyers on their side, and their income, if spent wisely, will keep them the rest of their days. When they die, their kids will get free income, which by definition of the law governing estate taxes, would likely be enough to fulfill their needs for the rest of their lives, or at least make their current situation much more comfortable.

But this measure was so offensive to some that they had to call it a Death Tax (presumably the same tax that funds the Death Panel, which presumably meats on the Death Star) It was so necessary to end this terrible tyranny of taxation, that the Republicans were willing to give up 75 billion dollars a year in revenue, even in a time of great big deficits, in order to correct the injustice.

Hooray for moneyed aristocracy!

But now that we're prepared to reform healthcare, at a much, much lower price, and bend down the costs of healthcare for all, well, we can't afford that, not can we?

That's the screwed up nature of their priorities. There are more than enough rich, and we will see their kids inherit more than enough money from them. But there are also far too many uninsured, and far too many who are insured, but don't get the healthcare they pay for.

So let's be frank here: when rich people's money is on the line, no expense can be spared. When the health of tens of millions of Americans is at stake, we must close the purse-strings.

If that is not the attitude of the Republicans, of the conservative Democrats, then they have plenty of explaining to do about how the obvious facts stack up, because otherwise, I'm confused as to just how they can say that this is not as callous and cruel a balance of power as it sounds.

Posted by Stephen Daugherty at September 7, 2009 3:17 PM
Comments
Comment #287656

Well, there are plenty of us who don’t share the belief that it is an “expense” when the government doesn’t take money away from people, or that the government is “giving” whatever it doesn’t confiscate.

This is a fundamental difference in belief about the role of goverment. If you believe that everything belongs to the government and what we’re allowed to keep depends on the largesse of elected officials, then this is where it leads you.

The GDP of the US last year was aroung 14 trillion dollars. I’m not one who believes that the federal government “gave” us whatever percentage of that they didn’t skim off for themselves.

Posted by: Paul at September 7, 2009 4:07 PM
Comment #287659

In both cases, the liberals wish to take property from those that have earned it and give to those that have not. The rich you refer to have already paid income tax on the monies that their children stand to gain. Why tax it again because “they don’t need it”? I dont “need” the medical insurance I now enjoy, yet the liberals think that I should have my monies taken away from me to provide services for someone else. Your need has little to do with my property rights.

Posted by: submarinesforever at September 7, 2009 4:20 PM
Comment #287660

Why do liberals always seperate people into classes: rich and poor, white and black, those who have and those who have not. Whatever happened to the american dream of being the best you can be. There are legal aliens who come to this country and are successful and the left will try to keep everyone down and tell them they can’t make it on their own,they need the help of the government. Of course, help comes in the form of taking away from those who are successul. I get so tired of hearing this same mantra from the left and I believe there is a majority of americans who feel the same way.

Posted by: propitiation at September 7, 2009 4:36 PM
Comment #287662

The government has never been able to earn money “well” in excess of what it spends. So if it is always net negative they can only take more from the tax payer to give it to another tax payer. The better arguement here Steve might be Wall Street bonuses which are out of control when there are no results to substantiate the payout. I am betting you’ll find more there year in and year out than in taxes that impact the transfer of wealth.

Posted by: Edge at September 7, 2009 4:48 PM
Comment #287664

I was going to respond but I believe it was already well said above. Big government always requires big taxes and since nearly half of adult American’s already pay no taxes they must take more from those of us who work and earn more than they do to keep them voting their way..

Posted by: Royal Flush at September 7, 2009 6:00 PM
Comment #287665

S.D.
Your Robinhood ideals are not going to fly.

Posted by: KAP at September 7, 2009 6:21 PM
Comment #287666

Paul-
The Bush tax cuts are deficit tax cuts, which means the government pays its bills by issuing debt which is bought.

That bought debt will ultimately be redeemed at a certain interest rate. You will foot the bill on that. You, the taxpayer, will pay for your tax cut with interest, because it was a loan taken out in times of debt rather than a rebate given in times of surplus.

In my mind, deficit spending is for emergencies, for times when the money cannot be raised any other way. The stimulus bill, TARP and other funds, were necessary to prevent an economic disaster of greater proportions, one that would have ultimately lead to even greater deficits as our spending remained the same, but our revenues dried up.

Republicans, though, took Reagan and Dick Cheney’s lead. Deficits didn’t matter, as long as it was a Republican taking them out.

Our new spending is rather minimal actually. In fact, forcing it to go through reconciliation to pass may end up making Healthcare Reform Deficit neutral. Three percent of the deficit is New spending on things like energy, healthcare, and other programs.

But that doesn’t fit the nice neat stories that folks like you are told. So maybe, despite the fact that it’s really much closer to the truth, it will get disregarded, because after all, despite doubling the debt, after starting from a surplus, the Republicans couldn’t possibly be bigger spenders than the Democrats.

submarinesforever-
If you don’t tax the folks who have more than they need to support a system, you support it on the backs of those who can’t afford it. Is that your preferred alternative?

I know Republicans are allergic to tax hikes. Sorry folks, you’ll just have to break out in hives. Sooner or later, we’re going to have to confront the deficit.

Now we should cut whatever spending we can agree to as unnecessary, and we should cut waste and fraud and all those things. But once that is done, we should be willing to pay for the rest. If the cost is too high, then people might scale back what they want from the government.

But if the cost is to be borne, let’s not target the people who actually need the money for food, housing and other items first. I mean, I think that point would be obvious, but we’ve been conditioned over the last generation to think of those already fortunate souls first, rather than take care of Public interests in general.

Propitiation-
Oh, blaming us liberals for the fall of western civilization? Maybe you should listen to Democratic Party rhetoric. We talk about the American dream. We talk about responsibility. Maybe it’s politically incorrect to talk about rich and poor, but they exist, don’t they? Those who don’t have enough, and those blessed beyond their needs? And despite all the rhetoric from the right, there are still conflicts and controversies between the races? Why not resolve them, rather than pretend they’re not there.

You can feel whatever you want about the majority of Americans. But it’s not an accident that they voted us to victory twice, that they elected Barack Obama. They are sick of being told that in order to fulfill their interests, they have to give the Rich and powerful everything they want. That’s your “populism”.

Not taking, in fact giving plenty to the successful has not lead to more people following them up to success. The opposite in fact. What we need is a system, like that FDR and JFK and others built up, which rewards good work, good education, and good commitment, rather than rewarding people for being already heavily rewarded as it is.

The rich remained rich in the times before Reagan stepped in and help them, and their taxes are much more than Obama’s even thinking of making them.

The real question here is whether the government’s supposed to help the vast majority of people. or whether it’s a battleground for extra power and money for those who already have it in plentiful supply.

Which do you think is better?

Edge-
I picked this particular example because it is simple and evocative of the misplaced priorities of what is affordable. There’s a big anti-middle class bias in the government right now, and it seems that among some, helping out the bulk of Americans is considered so much more unreasonable than helping the few who are already powerful and wealthy to gain more of each.

Posted by: Stephen Daugherty at September 7, 2009 6:47 PM
Comment #287667

Royal Flush-
That’s income taxes. They instead see hundreds of dollars go out in medicare taxes, which are capped for the rich.

They also pay more in sales taxes, given the marginal utility of their incomes.

I think you should more carefully research this “lucky ducky” line of argument.

KAP-
Tell me then- it wasn’t your party who, despite how your brackets actually stacked up, sold the tax cuts the American people by saying you’d let them keep more of their money?

The difference between my populism and yours, is tha yours requires me to give the money to the rich first, so that it will trickle down at some later date.

Posted by: Stephen Daugherty at September 7, 2009 6:53 PM
Comment #287668

Stephen

Your argument is invalid. It is one of those meaningless comparisons.

You could keep on taking from “the rich” to pay for anything you consider valuable. It seems very attractive if you don’t have any experience and don’t understand the dynamics of human systems.

But your argument is not about health care. It is simply redistribution. Let’s ask the simple question. How much is too much?

I don’t like anybody who is richer than I am either. Maybe we should tax them to even it out. Yes, Oprah makes too much. Tax her. Yes the Kennedy’s inherited too much money, give them $40,000 and call it even. They don’t work hard enough to deserve all that money.

Obama made more than $4 last year. Claw that back. The Clintons made $20 million. That is $19,775,000 more than they deserve. Take it back.

You guys believe all wealth belongs to the government and people should only get to keep what politicians decide they deserve. That is a ground-truth, rock bottom difference between left-liberals and others.

Of course, as experience shows, they don’t live that way. Pelosi is loaded. Clintons are multimillionaires. Half of Obama cabinet seems to have made the big bucks in investment banking.

But Democrats advocate high taxes because they don’t pay them. Think of all those caught in the net. How about Charlie Rangel? He writes the tax laws, but “forgets” about nearly $700,000. Since he didn’t know he had it, maybe we should just take that too. That could pay for some health care.

If liberals want to give more money to Washington, let them. The “excess money” from Hollywood alone could fund health care reforms.

Posted by: Christine at September 7, 2009 7:02 PM
Comment #287669

S.D
As I told you before I HAVE NO PARTY AFFILIATION,and no Stephen robbing from one to give to another is not the answer, fair taxation for everyone is the answer but I guess that’s to hard for liberals to grasp, they would rather live in your fantasy Robinhood world.

Posted by: KAP at September 7, 2009 7:07 PM
Comment #287671

Stephen

Medicare taxes are NOT capped for the rich. I made decent money and near the end of the year I stop paying SS taxes, but the medicare taxes just keep on coming.

I pay enough in SS to fund a couple of poorer people who will get more “back” than they contribute. I will never get my money back. They will live off my contributions. I can understand that helping them out. They don’t have to thank me, but how am I ripping them off by working hard enough to make more money?

I have the option of taking partial retirement. I could work half as much. Then I wouldn’t reach the limit of SS. It would increase equality in a small way. Would that make the poor better or worse off?

What if everybody in my situation decided to increase our leisure time by working less, earning less and paying less in taxes? You would be happy to get rid of some of the petty-rich, right?

Think about that w/o the hate of class warfare and tell me what I should do.

A little dose of reality would help liberals make better decisions.

Posted by: Christine at September 7, 2009 7:13 PM
Comment #287672

Clinton is not a good example of someone who wouldn’t like the ‘death tax’ to remain in effect. He has made himself more than clear on the subject numerous times. He sees the benefits of those who make it pay it, because those who don’t make it can’t pay it. Simple mathematics.

Posted by: Marysdude at September 7, 2009 7:13 PM
Comment #287673

Stephen, if government measures which don’t add defecits and don’t result in increasing debt are really your issue, then we can play ball.

This notion that the way to decrease defecits and debt is to astronomically increase them, however, doesn’t stand up to even minimal scrutiny, especially since this spending under Obama hasn’t had the effects that were promised by the projections of Obama’s own advisors. Seen the unemployment rate lately?

Lots of us wouldn’t have the problems with taxation that we do if we didn’t see our taxes going to waste in all of these massive bumbling government programs. It’s the same reason you think twice before loaning money to somebody with a gambling problem when he tells he needs it “to pay his rent.” While you might want to help the guy out, yes, you do feel like it’s your money and not his. Selfish? Sure, if you want to see it that way, but you’re not going to be so eager to part with your dollars if you’ve been burned over and over again before by the same guy telling the same story.

Posted by: Paul at September 7, 2009 7:16 PM
Comment #287675

Nearly everyone’s comments above miss the elephant in the room for the tired old ideological arguments of the Left and Right.

If the nation’s economy fails, everyone who hasn’t found a way to secure their wealth overseas, will lose portions of their wealth, and those without wealth will know the definition of destitution and powerlessness.

Our nation is on track at this very moment to collapse before it reaches the 20 trillion national debt which current fiscal and monetary policy will achieve by 2020. Everyone will lose, except the most clever of criminals who find ways to park it overseas and not get caught.

So, while folks argue socialism vs. fascism, capitalism vs. communism, our nation ignores the realities and pragmatism which are mandated by those realities.

The Left wants to scream against spending cuts, and the Right wants to scream against tax increases. Arithmetic doesn’t change. To halt the debt rising BOTH spending cuts and tax increases will be required. Everyone will experience the tightening or our national belt, if we do the Correct pragmatic thing by cutting spending and raising taxes where the spending cuts and raising taxes can be most afforded and the deficits zeroed out.

There are only two rules for this pragmatic solution. Rule one: The economy must be kept viable during the spending cuts and tax increases. Rule two, the spending cuts and tax increases must zero out the deficits before either the interest payments create defaults against our creditors, and, before the next big recession/depression occurs (which takes past the point of no return on the size of our national debt by even more borrowing to stimulate the economy.

America can still save its economic future. But, the clock is running out. And the Democrats and Republicans are the ones running out that clock, blocking each other from taking the necessary steps to save our nation’s future.

Obama screwed the pooch when he didn’t veto the Democrat’s and Republicans pork spending bills early this year. And now Republicans will wage a no lies or deceptions barred campaign to prevent tax increases, or even allowing tax cuts to expire. And the Democrats in Congress have proven already that they will knowingly spend our future into oblivion if given half a chance.

It’s real. Democrats and Republican’s children alike will not see an economic future anywhere near as full of opportunity and sufficiency as we have experienced since WWII, if the ideologues of the Left and Right have their way. And they are having their way.

A thorough surprise 2010 election that results in the wholesale ejection of Democratic and Republican incumbents is the only wake up call I believe our Two Party system will pay attention to. Therefore, it is up to you, the reader, to vote for the solution, or to keep the darkening clouds on the horizon building for your children, and their children.

Posted by: David R. Remer at September 7, 2009 7:46 PM
Comment #287676

Isn’t it always the same old story. Take from those who are productive and give to those who aren’t with the politicians as the middle man.

We were told by Obama that since American’s, with money, weren’t spending it the government would have to spend it on their behalf and send them the tax bill later. Now, we read that Obama wants American’s to save more and might urge legislation to favor that. This man has no brain, no logic, and no business being chief executive. I sometimes wonder who ties his shoelaces…one of his kids?

Posted by: Royal Flush at September 7, 2009 7:51 PM
Comment #287677

Stephen and Other Robin Hood Libs

Let me give you a precise tax incentive/work question. I have worked all my adult life and have enough for retirement, with or w/o SS. In the last couple of years, I have begun to build a small business doing something I enjoy doing. Almost to my surprise, it is beginning to make money. While it hasn’t created any full-time jobs, we did pay out almost $45,00.00 to workers. That would count as one job paying the median wage.

I am torn between the desire for leisure and the aspiration to create something lasting. I don’t need the work and I am old enough that I don’t need to build a business for myself, but I would like to leave something for my kids and grandchildren.

So let me sum up. I CAN build a profitable business. My belief is that it could be worth millions based on current trends, but I don’t have to. If I calculate that I can pass my work on to my family, I will do it - happily. Otherwise, I will just live off the fat of the land, consuming resources instead of making them and stop being a productive member of society, putting the skills developed over a lifetime on ice.

You understand. Individuals have the power to withhold their work and their innovation. They can NOT use their most valuable skills. And there is nothing government can do about that. If you make it unprofitable for me to work, I don’t work. If you make it hard to create jobs, I don’t bother. Millions of people are making calculations like this every day.

The productive people of this country really do have the ability to kick back, just by kicking back.

Posted by: Christine at September 7, 2009 8:06 PM
Comment #287678

Once again California leads the way. Their electorate will not tolerate any new taxes or fees and government is responding by cutting back to bare essentials. I have to laugh when I hear of cut backs of “non-essential” personnel. Hell fire, if they aren’t essential why were they hired in the first place?

Do you personally know any business that employs “non-essential” workers? Are they still in business?

The federal government should be compelled to follow the example in California forced upon it by the electorate. Is there a slim chance the electorate could do the same with our bloated federal government? Perhaps with enough changes in 2010 as Mr. Remer suggests, we could.

Posted by: Royal Flush at September 7, 2009 8:08 PM
Comment #287680

Very well stated Christine and an argument that I fully understand and endorse.

Posted by: Royal Flush at September 7, 2009 8:12 PM
Comment #287685

Stephen:

In 2010 estate taxes go to zero. However, at the same time there is a loss of stepped up basis. This concept basically changed when taxes are paid.

For instance, take the situation of a wealthy person who dies in 2010, Currently if the wealth person’s estate is primarily in Real Estate or is the owner of a business, there is a strong likelihood that the business would need to be sold to pay estate taxes.

Then because there is a stepped up basis, should the heir sell the business or security, the cost basis would be the value of the asset on the day of death.

However in 2010, there is no estate taxes due. However when the heir decides to sell an asset they must go back to the original tax basis.

In your article you are looking at one side of the equation. Wealthy heirs will pay plenty when they sell. We can fiddle with the numbers (different capital gains rates on inherited assets sold). However there is so much needless cost because of the current system.

Let me give you an example. Many times elderly buy life insurance, simply to pay for the estate taxes so that a family business can survive. This new to the united states concept eliminates the need to buy financial products to make sure the family farm passes to the next generation.

This is an important improvement in Estate Tax Law. It can be done in a revenue neutral way that would have huge benefits for families

Posted by: Craig Holmes at September 7, 2009 9:11 PM
Comment #287686

David,

I agree with you on the voting out incumbents, but find it a negative proposition. Who are we going to vote FOR?

Christine,

You sum it up in one line:

“If you make it unprofitable for me to work, I don’t work.”

I suspect that applies to everyone except slaves and the starving. Even to you’re part time workers.

Yet, in this communist environment, you are turning a profit. You do choose to work. You envision a potential for millions.

This is the classic “crying wolf”. In reality, you move on undeterred, but in your politics you scream about economic annihilation. A not uncommon position I hear from the business class.

Stephen is talking about the very top echelon’s of wealth being able to pass on their vast wealth to their children UNTAXED. He is not talking about destroying small business incentives. If you don’t understand the nature of this “Death Tax”, you don’t understand his point. I’m not sure “work” is involved here.

Even as business has decried the burden of health insurance rising costs in competing with foreign companies, there is now the specter of destroying business, somehow, by attempting to actually stem these costs. It boggles the mind, if one doesn’t recognize the rhetoric.

Posted by: gergle at September 7, 2009 9:19 PM
Comment #287688

Craig,

Ummm, this isn’t about the family farm.


http://www.factcheck.org/article328.html

Estate tax rates and complexity have driven a vast array of support services to assist clients with a perceived eligibility for the estate tax to develop tax avoidance techniques. Many insurance companies maintain a network of life insurance agents, all providing financial planning services, guided to avoid paying estate taxes. Brokerage and financial planning firms also use estate planning, including estate tax avoidance, as a marketing technique. Many law firms also specialize in estate planning, tax avoidance, and minimization of estate taxes.

The first technique many use is to combine the tax exemption limits for a husband and wife either through a will or create a living trust. Many, but not all, other techniques do not really avoid the estate tax, rather they provide an efficient and leveraged way to have liquidity to pay for the tax at the time of death. It is very important for those whose primary wealth is in a business they own, or real estate, or stocks, to seek professional advice or they may run the risk of the estate tax forcing their heirs to sell these things at an inopportune time. In one popular scheme, an irrevocable life insurance trust, the parents give their children (within the allowed yearly gift tax limit) money to buy life insurance on the parents in an irrevocable life insurance trust. Structured in this way, life insurance is free of estate tax. However, if the parents have a very high net worth and the life insurance policy would be inadequate in size due to the limits in premiums, a charitable remainder trust may be used. This is where a large asset is flagged to be donated to a charity, sold, and invested. The investment income buys life insurance but the principal goes to the charity when the parents die. Meanwhile the children get the full amount as well in life insurance proceeds. This is a large reason for many charitable gifts, and proponents of the estate tax argue the tax should be maintained to encourage this form of charity.

Posted by: gergle at September 7, 2009 9:34 PM
Comment #287690

“business would need to be sold to pay estate taxes.”

So What? Businesses also get sold or mortgaged to buy out inheritors who want to cash out. Except for the slave-owners, all of our other ancestors came here to get away from hereditary aristocracies. Do you understand that the system of inherited wealth requires a permanent class of servants who have to be imported over and over again since hereditary involuntary servitude is illegal? Most people I know expect their children to make their own way unless they are handicapped or mentally challenged.

Posted by: ohrealy at September 7, 2009 9:48 PM
Comment #287691

Gergle

Working is fun sometimes, but taking responsibility for building a business is not always pleasant. I am just saying that in my own case I am on the fence. I certainly will not bother to work hard if someone takes too much of my money and/or doesn’t allow me to pass most of it on to my kids.

I have the power to create jobs - or not. Government can influence the decision. If they tax me too much, I do less. If you drown me in paperwork, I don’t bother.

I can tell you in very concrete terms that if we did the kinds of things Stephen talks about, I will not go through all the trouble and several jobs will not be created. Thousands of dollars in taxes will not be paid in because they won’t be earned.

Money itself is not a big motivator for me anymore. It is what they call a hygiene factor. There has to be enough otherwise I feel like a chump. It is not like I will give up working immediately, but you make decisions one day at at time. Waking up and trudging off to work is not always fun. I have the option of not doing it. If that is what you want, tax the crap out of what I produce.

BTW - I don’t understand your reference to a communist environment. I suppose it is some kind of hyperbole, but it is not important to the argument, so I am ignoring it. If it is indeed an important part of your statement, please tell me why and I will address it.

BTW 2 - IMO you have to be able to pass around $10 million to kids tax free if you want to maintain businesses. Otherwise it might be necessary to sell productive assets to pay taxes. You can tax the INCOME from those assets if you want. But sometimes assets don’t produce much consumable income.

I am not an expert, since I am just learning, but one of my friends has a S corporation that produced $300,000 in taxable income but really only yielded around $60,000 in money he could spend. He had to sell assets to pay taxes.

In my own small business last year I made $16k on one transaction which was exactly offset by an investment I made related to that money. Yet I got stuck for taxes this year on the 16 and had to depreciate the investment. That meant I had to dip into my own pocket to pay taxes on money I didn’t have in hand.

Most people just earn wages and live in ignorance of these concerns. They don’t understand these things and/or how you can go out of business making money too fast and getting stuck for taxes when you really don’t have much cash flow. these are the kinds of concerns that make me think twice before going into business and creating jobs for others. And if you want to government to take it all from me, why bother?

Posted by: Christine at September 7, 2009 9:58 PM
Comment #287696

Christine,

I suggest you read my response to Craig.

Yet I got stuck for taxes this year on the 16 and had to depreciate the investment. That meant I had to dip into my own pocket to pay taxes on money I didn’t have in hand.

Not to nit pick, but what did you expect? To not pay tax on a $16,000 profit? If you depreciated the investment, you deferred taxes and lowered your tax base. You benefited from that. I’m not sure what you meant by “you had to”. Tax planning is a part of any business, that doesn’t mean that any tax at all is a horrible burden does it? It seems to be your argument.

Posted by: gergle at September 7, 2009 10:19 PM
Comment #287697

Christine-
First, don’t confuse people with that BS about redistribution. I want some, not all. This isn’t about the kind of socialist confiscation you’re trying to scare people with.

This is about the Rich taking on a greater burden. But it’s not a burden without blessings.

Look at the sorry state of our economy. Why do people depend so much on credit nowadays? Because businesses have done everything they could to suppress wages and benefits.

But more than that, the system has been designed for the last generation to encourage people to endebt them, and then to inflate profits for those doing the endebting by making sure that debt was an endless burden of fees.

The system had been built up on circulating IOU’s, debts, as if they were worth something, even apart from some person being able to pay it off. It’s a system based on a deliberate disconnect with reality that is elaborated into a system that every so often collapses of the weight of its own fictionality.

Or, put another way, last year’s crash was essentially the financial community being too clever by half, and finally getting confused itself as to what exactly everything it was selling was worth.

We might not have seen as much apparent economic growth. We might even have seen a recession. But it would have been much more real, and the toxic confusion that we found ourselves dealing with wouldn’t have come to pass.

As for Charlie Rangel? If he’s guilty, let him be held accountable. You overestimate how eager Democrats are to defend their own just for the sake of defending them. Yes, John Murtha, too.

As for Hollywood? I don’t know why you folks shouldn’t be friendlier with them. After all, you too employ people who make tons of money scaring people with fake stories!

KAP-
You know me. I categorize people by their expressed beliefs. If I occasionally call you a Republican, it’s only because of the similarity of your positions.

As for fantasy worlds? I think it’s a pure fantasy to believe that balancing the budget can be achieved purely through budget cuts and spending freezes. When will folks like you stop with this silly allergy to moderate taxation, to taking in enough money to pay for the government we get?

Christine-
They will work for their own contributions as well. But this isn’t about class warfare.

This is about the simple blunt fact that the interests of most people are those of the middle class, and all too many government decisions have punished those who aren’t a big powerful corporation, or a person making money.

The inequity between how much of an inheritance tax break one group of people gets, and the healthcare system they claim we can’t afford is a prime illustration of just what some claim is affordable.

But if you really look at it, how many people benefit, in their finances, in their wealth, from that inheritance tax abolition? Very few. From Healthcare? Very many.

What good has it done this country to see healthcare costs rise faster than inflation? What has it gained us? In analyzing such policy, political dogmas are insufficient, and misleading.

The Republicans need a dose of reality: the wealth hasn’t trickled down. It’s demonstrably pooled at the top, more so than at any time since the Great Depression. That’s not coincidence.

Ultimately, people must have money to pay for products, or pay off debts for what they finance. When you don’t give people enough money to do that, they can’t spend enough money at businesses to lead those businesses to return on their investment. The banks that invest in them can’t get their loans back. It’s a vicious cycle of cut-off circulation. And like any part denied good bloodflow, business and productivity atrophy.

What you have to realize is, the real class warfare has been against the middle class and poor, as the Rich have seen their interests indulged to trillions of dollars worth of excess. But for that wealth and comfort, they’ve seen the rest of the country break down like a poorly maintained engine.

You can’t, ultimately get something for nothing, or expect people to run an economy out of a deficit of finances.

It may be painful for some who have benefited from years of iniquity, but the middle class needs to revitalized, or we’ll be stuck in the economic doldrums for some time to come.

Paul-
Look, you folks tried letting the market hash everything out. Result? You turned a bad situation worse, brought it to a point of crisis. All that bailout spending and stimulus was meant to counter the after-effect of the Republican’s failures.

We’re investing in the things that will result in America’s gain: healthcare reform to reduce healthcare costs, energy alternatives to reduce dependence on fossil fuels and foreign oil, among other things. Instead of investing in preserving the status quo, the Democrats are taking the ten percent we’re almost completely responsible for, and using it to change the game for the better.

About 38% of the budget deficit is the recession. How much would we be seeing, if we’d let the recession get out of control, let the financial systems crash? We acted to reduce that.

About 33% was Bush policies. An added 20% were continued Bush Policies, including the war and TARP.

When it breaks down what’s going on, is we’re paying the bill for the Republican’s own gambles, their own excesses. And you’re complaining about our meeting of your obligations.

Just makes me feel warm and fuzzy inside.

Royal Flush-
Productive? That crap on Wall Street is what they call productive.

Besides, can you tell me when your average American stopped being productive? The way the guy who gets higher taxes is productive is by sitting in a room all day and telling the rest of us how to be productive.

Make disrepectful jokes all you want. The real disrespectful joke is the elitism hidden in what the Republican Party calls populism. Here’s a hint: it’s not populism if the first option you come up with to benefit the masses is to throw money at their upper-crust.

Craig Holmes-
Less than two percent of the population actually pays estate taxes. And most of them own more than a family business. You can probably get around that problem if it does exist, with a few well-written exceptions.

Posted by: Stephen Daugherty at September 7, 2009 10:31 PM
Comment #287700

SD;

“Maybe it’s politically incorrect to talk about rich and poor, but they exist, don’t they?”

Yes they exist, and they will continue to exist as long as liberals are willing to give a handout to classes of people. The goal of liberal theology is keep the downtrodden poor. What government program has ever made an American citizen rich?

“But it’s not an accident that they voted us to victory twice, that they elected Barack Obama.”

This statement shows your lack of understanding of what actually happened. Obama promised “Change”, that is change from the previous administration. But, people are learning, he is not the “messiah” we were led to believe. He has continued the same Bush policies and added some. Bush and many republicans lost because of their intrusion into American’s lives, their unchecked spending, and voting for stimulus packages, that no one wanted. You add these two things together and this is the reason democrats are in control. This was not a mandate to be stupid and that is just what Pelosi, Reid, and Obama are doing. You know this to be the truth, but you, as a liberal cannot bring yourself to admit it. This light is ringing true to many who voted for Obama. By your logic, if the conservatives make gains or take control of the congress in 2010, it would be because they thought the democrats screwed up. Would you be willing to acknowledge this for the same 8 months you have reminded us of your victory?

“What we need is a system, like that FDR and JFK and others built up, which rewards good work, good education, and good commitment, rather than rewarding people for being already heavily rewarded as it is.”

Good work: in case you haven’t noticed, jobs are being lost, and the anti-capitalists that Obama has surrounded himself with, will never create jobs.

Good education: the American taxpayers have thrown billions into education, but it appears money is not the problem. DC spends more money per student than any other state and yet they have the worst performance and the highest dropout rate.

“The rich remained rich in the times before Reagan stepped in and help them, and their taxes are much more than Obama’s even thinking of making them.”

Are we talking about the rich like the Kennedy’s, who have passed their money from one generation to another through trust funds, or are we talking about entrepreneurs who have gotten off their lazy rear ends and started to work, and actually accomplished something. Does a liberal have the ability to understand the term “personal responsibility?

This post is ridiculous and judging from the responses, you are along in your robin hood mentality.

“The real question here is whether the government’s supposed to help the vast majority of people. or whether it’s a battleground for extra power and money for those who already have it in plentiful supply.

Which do you think is better?”

I am willing to answer your question:

1. It is not the responsibility of the government and is not promised in the constitution that all men would have equal wealth.

2. It is not a question of power and money to those who work, it is a question of power attained by greedy politicians who steal money from working Americans for the purpose of building their own power base.

Which do you think is better?


Posted by: propitiation at September 7, 2009 11:04 PM
Comment #287701

Gergle

I would have preferred to just match the cost with the income. IRS doesn’t allow it. I am not saying it should be tax free, but it is also true that the taxes due were more than the money I received. Too much of that sort of “profit” could put you out of business.

Stephen
I don’t care about the super rich. Tax the crap out of them for all I care. I bet most are Democrats anyway.

I am talking about the almost rich or little rich. These are the ones who own the businesses, take the risks and create most of the new jobs.

All that I am telling you – again – is that these people have the power to create jobs or not. If you make it hard for them, they stop doing it. You might feel compassion for the lowest 20%, but they don’t work very much or produce new jobs. The government doesn’t punish them. They don’t work.

You need the innovators but you cannot force innovation. I am sharing with you actual experience about starting businesses that create jobs.

My point about Rangel, Murtha and other Democrats is that they don’t seem to pay the taxes they want to impose on others. Beyond that, most of these politicians have not actually created any new jobs. They don’t know what it is like to be in business. If you want an interesting read, Google what George McGovern wrote about business, AFTER he retired from politics and tried to open a small B&B.
“In retrospect, I wish I had known more about the hazards and difficulties of such a business…. I wish that during the years I was in public office I had this firsthand experience about the difficulties business people face every day. That knowledge would have made me a better Senator and a more understanding presidential contender… To create job opportunities, we need entrepreneurs who will risk their capital against an expected payoff. Too often, however, public policy does not consider whether we are choking off those opportunities.”
Stephen – not trying to give you a hard time, but have you ever tried to run a business? Many people are attracted to running their own business in theory, but go for the regular wages after getting a real taste. That is why wage earners deserve to make less than business owners, everything else being equal.

RE Hollywood – Hollywood is a special sub-case. Most businesses build over a long time, a little at time. Actors can make fantastic money with a couple of lucky breaks. The average American millionaire doesn’t make her million until she is almost sixty years old. If a leading man or woman actor hasn’t made by the time they are twenty-five, they probably never will. This big difference makes Hollywood types less serious about money and more likely to think it comes from luck or good looks, since for them it does.

Read a little re real millionaires - http://moneycentral.msn.com/content/SavingandDebt/P80541.asp

Posted by: Christine at September 7, 2009 11:04 PM
Comment #287703

SD
Thanks. The response has been typical parroting of dis-information and thoughtless rhetoric. If one believes in equality of opportunity then one must logically support a confiscatory tax on dynastic wealth. If one supports what amounts to an American hereditary aristocracy then one has no claim to the ideals that brought forth this nation. This aristocracy,left unchecked , will do tremendous damage to the country and world if left unchecked. Sooner or later, a correction will occur. Taxation is the mildest form of correction . Other past methods have included the guilotine and the firing squad.

Posted by: bills at September 7, 2009 11:12 PM
Comment #287704

Christine,

“I don’t care about the super rich. Tax the crap out of them for all I care. I bet most are Democrats anyway.”

Good point Christine, a good example would be that cook by the name of Charlie Rangel, dem rep, who won’t even pay his own taxes and yet wants to tax others. What an indefensible crook? He is a typical liberal, “do what I say, not what I do”.

Posted by: propitiation at September 7, 2009 11:15 PM
Comment #287708

Bills, it’s astounding to hear someone say that a “confiscatory tax” on the rich has anything to with creating “equal opportunity.” If the government took every single dollar away from Bill Gates and Warren Buffett, would that give you or me any more opportunity? More opportunity for what? It would certainly destroy a number of charitable insitutions, research centers, and arts foundations, and I suppose that pulling off such a coup might achieve a certain kind of equality—egual misery for a whole lot of people whose lives depend on these “dynastic” fortunes.

“Equal opportunity” itself is nothing but an empty and meaningless feel-good phrase anyway, and it has no connection to reality. All of those firing squads and guillotines you speak of have never achieved any such thing.

When and where has there ever been genuine “equal opportunity?” If there is such a place, it’s got to be a shanty-town built on a garbage dump and surrounded by barbed wire.

Posted by: Paul at September 8, 2009 12:21 AM
Comment #287715
Why do people depend so much on credit nowadays? Because businesses have done everything they could to suppress wages and benefits.

No, it is because they are morons. Or, more importantly, were never taught about the realities of credit. Instead they are told they can ‘have it now and pay for it later’ and to someone with no understanding of individual responsibility (our fault for not pointing that out to them at any time in their lives) they just keep racking up the debt figuring they will either a) strike it rich or b) it will be taken care of by someone else.

And because we do, it continues.

We are now told that we can’t exist as a country without so much credit. Does a society built upon credit sound like a good idea? If you were setting out to build a nation from scratch, would you suggest that as a good idea?

So why are we not only NOT teaching people that credit is bad but engaging in the most reckless AND selfish paths towards insolvency that we have been one for the past 25 or so years? It continues and we allow it.

We must cut spending, if you don’t support spending within your means then you have no right to complain that Bush didn’t either. Neither party now has the political courage or capacity to stop it and neither party can say anything ill of the other party’s propensity for spending their grandchild’s money…

Change? No, we don’t even have any of that any more…

Posted by: Rhinehold at September 8, 2009 4:45 AM
Comment #287719

Stephen,
I didn’t see where anyone slammed you for calling 75 billion, three quarters of a trillion - so allow me: Check your math!

The whole argument that the money has already been taxed is illogical. When it changes hands as profit it is eligible to be taxed again. Otherwise if I sell a widget for a million dollars profit I could just say the buyer already paid taxes on that money so I’m good.

Posted by: Schwamp at September 8, 2009 10:17 AM
Comment #287725

Schwamp-
I’ll correct the error: I left out “over a ten year period (10*75=750, 750 billion is three quarters or 75% of one trillion)

Rhinehold-
The Credit Card Companies could have done that themselves. After all, they’ve got their hand on the spigot, and could deny cards to those who had bad enough credit. Then market forces alone would teach people.

But the Credit Card companies did two things: they sought out the credit risks, and they also acted to basically do their best to categorize just about everybody as a credit risk. Why? So they could charge higher interest rates and through trickery of accounting post those as income.

You want a good idea of how the companies worked, then understand that your rate could be hiked by a credit card company simply for being late on another bill, and that you could be charged retroactive rate hikes on debt you had already accrued- something unthinkable anywhere else.

The whole system was set up to be predatory towards debtors, to encourage unnecessary indebtedness. You blame it on people being morons, but people are going in there with some rather reasonable assumptions about how credit cards should behave that aren’t borne out in reality.

Credit itself is not bad. In a modern economy, waiting for people to save up, or businesses having to wait for cash on hand to pay employees or do other things would slow the pace of growth considerably.

What went wrong here was that the rules that defined the shape of the marketplace allowed an emergent situation to build up where entire sectors were essentially poldered off from market realities, bubbled off from the reality that debts that are no good ultimately are not a sound basis for writing up profits.

I think the big problem here is that folks like you assume that the market has to operate according to rational sensibilities, that people have to do the smart or the wise thing, that the smart or the wise thing for one person is necessarily the same as the smart or wise thing for society as a whole.

Democrats like myself recognize that the market’s human, and therefore in need of some kind of regulation. We can’t act as if there’s some magic logic to the markets that if just left alone will solve all problems.

Christine-

I am talking about the almost rich or little rich. These are the ones who own the businesses, take the risks and create most of the new jobs.

Read this. Few, very few small businesses would be subject to the estate tax. Low three digits. But under Republican plans?

To see why, consider how few small business owners and farms pay the tax: in 2004, only about 340 small farm or business estates—where farm or business assets worth less than $5 million made up more than half of the total estate—paid any estate taxes; only 440 estates comprised primarily of a farm or business of any size paid the tax. Had the per couple exemption been $7 million in 2004, a mere 30 small farm or business estates and 110 estates with more than half their assets tied up in farms or businesses of any size would have paid the tax. To quote Henry Aaron of the Brookings Institution: “To use the easily handled problems of family farmers and small-business owners as justification for repealing the entire tax, thereby giving an enormous tax cut to a few extremely wealthy households, is simply dishonest demagoguery.”[16]

While few business owners or farmers pay the tax now, thousands of small businesses could end up facing higher taxes under repeal. This is because the president’s proposal would eliminate the ”stepped-up basis” rule, under which someone who inherits a small business does not owe capital gains taxes on the increase in the business’ value while the decedent owned it. Regardless of the merits of a switching to a stepped-up basis, it is clear that this change will raise taxes on the very estates repeal proponents claim they want to protect. According to Paula Calimafde, chair of the Small Business Council of America, about 40,000 estates take advantage of this “stepped-up basis” rule each year. By her account, while “proponents of repeal tout the benefits of estate tax repeal to the small business owner��?in fact, repeal will actually harm most small business owners.”[17] John Buckley, chief Democratic tax counsel for the House Ways and Means Committee, argues, “There is no question that there will be vastly more losers than winners from estate tax repeal,” and predicts that almost five times as many estates could be affected under the new rules. He sees “little question that the number of farm estates facing tax increases from carryover basis would exceed the number of farm estates receiving a benefit.”

As for your point about Murtha and the others? I don’t care if they’re hypocrites. Your argument is fallacious.

Just because a candidate fails to pay their taxes doesn’t mean they failed to pay them on purpose (which would mean that there was no intent, and therefore no willing breach of personal principle).

Even if they did fail on purpose, it’s problematic to draw that the policy itself is wrong on that account. That would be like, for example, arguing that age-of-consent laws should be struck down because Mark Foley supported them.

Or it would be like arguing that public lewdness laws should be abolished because Larry Craig did the kind of tap dance that wouldn’t have been welcomed on a old vaudeville stage.

Tax policies have their own justification on separate grounds, just as lewdness and age of consent laws have their own separate supporting premises arguing for them. That a supporter of either one might be a hypocrite does not invalidate that support.

As for whether businesses deserve more money? That’s a loaded question. A fair share, yes, a large share, yes. But such talk of shares ignores something critical: the person who this business is going to, whether they were taxed or not, did not necessarily have to do the work necessary in pulling it together.

It’s funny to call the inheritance tax the death tax- the dead, unless the Egyptians were on to something, are taxed at 100%. They lose everything.

This is a tax on inheritors, those who often get these large sums for free, who could have been sitting on a beach in the Bahamas while the original owner did all the hard work- or alternatively , they could have helped every step of the way.

Getting back to what I said earlier, though, with probably tens of thousands of small businesses out there, there are ridiculously few businesses that will actually fall under the law.

Posted by: Stephen Daugherty at September 8, 2009 1:28 PM
Comment #287726

Christine,

If a person is inventive…if a person is entrepenurial…if a person is innovative, and they allow taxation to circumvent those talents and traits, they deserve to fail. Not to worry, if one drops out for lack of stick-to-it-iveness, someone else will take up the slack. Do you honestly believe everyone who has started a business or other enterprise, in the history of the world, has not had to deal with adversity?

The successful ones hit the brick wall, bounce off, look for a way over it or under it, and try again. Those unwilling to do that…fail.

Posted by: Marysdude at September 8, 2009 1:31 PM
Comment #287728

Marysdude wrote; “If a person is inventive…if a person is entrepenurial…if a person is innovative, and they allow taxation to circumvent those talents and traits, they deserve to fail.”

Question…how does one “not” allow taxation? Let’s frame your statement in a slightly different way…
If a person is inventive…if a person is entrepreneurial…if a person is innovative, and they fail should they be rewarded with part of what I earn?

Posted by: Royal Flush at September 8, 2009 4:14 PM
Comment #287730

Huh?!? A reread might be in order…either I lost you or you lost me, but either way it is apples and oranges.

Posted by: Marysdude at September 8, 2009 4:58 PM
Comment #287734

propitiation-
First, let me state my opinion so I can define it for myself.

I believe people should enjoy the fruits of their labor. But I believe civilization, and the government programs we ask for have a price. I see it as fundamentally irresponsible to push perpetual tax revolt, without having first bitten the bullet and made the spending cuts necessary to make these measures deficit neutral.

I believe that more people should have the chance to improve their fortunes. Most folks will not get rich. But move up a little in the world? That can happen, and has happened a lot in the past. The trick is, today’s economy is rigged against that. The elites in this society have made it tougher and tougher for the middle class to make more money, keep more money, stay out of debt, and not get wiped out by various misfortunes.

I believe in capitalism. I just don’t believe a fair, equitable capitalist economy just self-organizes itself, without at least some rules in place to define the market.

No society can get away with not having the government define what’s proper behavior in a market place, at the very least. Contracts have to honored. Dishonesty and predatory behavior has to be discouraged. Disclosure of fundamentals for investors, and product information for consumers is critical. We can’t just throw this system together ad hoc unless we’re looking to have a big damn mess.

That said, I appreciate the necessity for free market dynamics, within those sorts of limits. I appreciate the wisdom of the crowds. I just think that sometimes we need to remember that we must seperate the truly, generally wise behavior (that which is good for society), from what we could call the “street-wise” behavior, which is what you have when the masses are adapted to a dysfunctional market, doing the best to serve their own interests in a rough, cynical, problematic market.

You talk of a theology of liberalism. I’d say the theology is yours. The Republicans have embraced the invisible hand of the market as if God is the only being and good is the only result that could invisibly influence the markets. In fact, markets can encourage damaging, bad behavior, so long as its profitable in the short term. Perhaps over time it is punished, but you get into situations where rather than being evened out by the “corrections”, the market is just falling into one delusion after another.

The devil can be the one with the invisible hand - good outcomes are not the only kind that can emerge from a market.

In short, I have no theology on the markets. I’m not a marxist, I don’t think the economy is simple enough for centralized control above certain scales. But I’m no free-market fundamentalist, either. I don’t have an abiding faith that something positive or even really sentient drives the behavior of the market as a whole, anymore than the behavior of ants is consciously dictated, or always positive (think Amdro).

I believe in many of the things you believe in. But many folks like you have become so wrapped up in Right-Wing Propaganda, that I could yell it loud enough to shake the rafters, and many of y’all would just think it a deceptive ruse. That doesn’t matter; I believe what I believe.

You know what I think is Ironic? That you think it’s an insult to call somebody “Robin Hood”. Last I checked, he was a hero. Who’s your hero, Gordon Gekko? Take from those who have less, to give to those who have more? Like it or not, believe it or not, that’s been the elitist policy your party’s followed.

The fact that folks in your party are itching to abolish a tax that only really affects the top few percentage of earners should give you pause. If taxes are so terrible, why do the Republicans drop so much of its burden on the middle class and poor?

The effects the Republicans seek are always second hand. We’ll give trillions in tax breaks to mainly top earners. Then when they feel like it, they invest or spend. These, the people who already have more than enough to invest and spend, but don’t. They’ll untighten restrictions on pollution, restrictions on economic behavior, this, that, and the other, and maybe we’ll get jobs. Or maybe the jobs will go overseas, because they were doing that favor, too. Not to worry! The jobs will come back with the economic benefits.

Now things are worse. And you expect us to take the blame, simply because we happen to be around when the consequences of your Party’s policies unfold? We’re losing hundreds of thousands of jobs every month because somebody let the economy become dependent on big damn bubbles, because we couldn’t do anything to puncture all the economic fictions we were dependent on.

I think it’s long past time for this country to start building an economy based on substantive improvements in its people’s standard of living, rather than on the numbers game in Wall Street.

One step will be improving healthcare for the average person. There are all kinds of economic downsides to letting healthcare costs have their corrosive effect. The system was built, like the credit system, essentially to endebt people permanently, because those debts could be counted towards profits even if they were unlikely to be repaid. Two thirds of bankruptcies are healthcare related.

And what happens when a person doesn’t get good healthcare? We lose productivity. We can lose their cognitive function. We can even lose them, seeing them medically retired, or just plain dead, their families and children put in uncertain economic straits.

There’s no such thing as a free lunch, and the costs saved by having a crappy healthcare system are swallowed up by the costs incurred by it.

Posted by: Stephen Daugherty at September 8, 2009 5:37 PM
Comment #287738

That was a nice response Mr. Daugherty. Can we all be honest with the numbers of those “legal” American’s who want but can’t afford health care? The real number is between 12 and 15 million. This could be addressed and resolved by spending around $30 to $40 billions.

When politicians address the actual numbers without all the BS attached I believe we will have a nationwide consensus and actually fix “the problem” without further endangering our fiscal mess.

Do you realize that in California only six of around 1300 health insurance companies are allowed to compete? Fix this problem along with some of the good cost savings features being discussed in congress and we’ll really have something to be proud of.

Posted by: Royal Flush at September 8, 2009 7:51 PM
Comment #287739

SD

First let me say, I have not said what party I belong to, if any. In fact I have condemned both republicans and democrats for uncontrolled spending.

Secondly, your logic does not make sense. How can you claim to be a capitalists and believe americans should be allowed to enjoy the fruits of their labors and in the same breath justify the giving of tax dollars to those who have no desire to work or improve their lives in any way?

The liberal theology (I use that term because their goals are their religion)is to make America into another European country. It is virtually impossible for an individual to start a business in Europe, unless you have connections with family, prestige, or old money. The goal of liberalism is to destroy the economy of America.

Universal healthcare is a smokescreen. The real goal is power, and control of money. Is there nothing about Obama’s plans the scares you?

Posted by: propitiation at September 8, 2009 8:03 PM
Comment #287741

Good points RF.

SD

If you are so concerned about the price of healthcare, then I am sure you would be in favor of insurance company competition, by ignoring state boundries. Further, I am sure you would be in favor of tort reform. These two things alone would cut the cost of healthcare. If not, perhaps you could explain why you would be against these two changes.

Posted by: propitiation at September 8, 2009 8:10 PM
Comment #287742
If a person is inventive…if a person is entrepenurial…if a person is innovative, and they allow taxation to circumvent those talents and traits, they deserve to fail.

This reminds me of that famous Kurt Vonnegut story, “Harrison Bergeron.” Know it? You might be the most talented and hard-working ballerina in the world, but if somebody ties heavy weights to your arms and legs, you’ll have a lot of trouble dancing.

Marysdude, you don’t have to be a business owner at all to know that we all have a vested interest in as many business owners succeeding as possible. Saying they “deserve to fail” is saying that everybody who works for them, and everybody who depends on the goods and services they bring to communities, also deserves to fail.

What is the first thing a depressed part of an inner city tries to do? Bring in businesses. And that’s because jobs follow businesses, renewal of communities is made possible by businesses. Anything that decreases the possibility of a business surviving is bad for everybody, not just the business ower who can’t figure out at way to take the risk of opening and running a business worth his while.

Posted by: Paul at September 8, 2009 8:27 PM
Comment #287744

Marysdude

Let me be clear. I am already a success in that I have enough assets to afford to retire today w/o the need for Social Security. BTW - I will be eligible for the top SS benefit, which I will indeed take. I might invest it in something productive or I might just behave like a Democratic victim-voter and p*ss it away on booze, fancy clothes and big cars and there is nothing anybody can do about it. See, this is a problem with the tax and forget policy. You may encourage the wrong kind of behavior.

I have the option of working on a business that will create jobs for others and keep me in the economy paying taxes rather than living off the fat of the land. This, IMO, will be fulfilling but also a lot of work. I can go either way on this. One thing that tips the balance in the favor of the business is that I could pass along a legacy to my family. If you take that away, there is no reason to continue to work and innovate, except for the fun and it might not always be that much fun.

I don’t know how you can fail to understand. Would you continue to work if you were not paid or paid you in money that expired at the end of year.

In this case, I don’t have to speculate about what others might do. I have the power to create jobs, or not. If I can pass a reasonable amount to my family, I will create wealth. If not, I will get in the line with you and use it up. Which would you prefer? Maybe you can take my place and work for nothing and I can live off the surplus wealth you create. Good luck with that.

So I suggest those of you who want to tax me into indolence get off your butts so that you can make enough money to support me and all the others who just don’t want to work. If you are not currently making enough to produce that surplus, I suggest you don’t really understand wealth creation and maybe should consider learning more about it.

Stephen
If you put the inheritance exemption at $10 millon I don’t have a problem and make sure it was adjusted for inflation. But I cannot trust the taxing politicians. I get stuck with the alternative minimum tax, which was aimed only at a dozen millionaires but has since come down to millions of reasonably well off people.

Taxes aimed at the rich tend to hit the middle class. It is like the old Three Stooges pie throwing. The big guy ducks and the tax pie hits the little guy in the face.

Your logical fallacy is exactly wrong. Read it again. I am precisely NOT saying that just because rich Democratic politicians cheat on their taxes, that is it okay. In fact, that seems to be the argument THEY would make. My position is that it is NOT okay that Democrats cheat on their taxes and just because they do doesn’t make it okay for others, but it does explain why they don’t care about raising taxes, since they don’t pay them anyway.

Posted by: Christine at September 8, 2009 8:51 PM
Comment #287745

stephen

“to ensure that Rich folks could leave all of their money to their children without federal estate taxes.”

the key word being THIER money. not yours, or the gov’ts, thiers. they earned it, they they should be able to do whatever they wish with it when they die. don’t like it. TOUGH SH#T, get over it, it’s not yours.

Posted by: dbs at September 8, 2009 8:54 PM
Comment #287750

I think an important point being missed here is that rich folks’ money is still circulating, and only crazy people have their excess wealth sewed up in their mattresses where it’s not doing anybody any good.

Anybody with a mortgage, or even a credit card, is deriving a benefit from money that belongs to others richer than themselves.

Money skimmed by the government from this system of circulating and growing wealth is only being redirected, not created. We all recongize that a certain amount of this redirection is needed. It’s highly questionable, however, that the government is always or even usually better at intelligently targeting this money than people who have something directly at stake in making sure that there is a return on every dollar.

Posted by: Paul at September 8, 2009 11:01 PM
Comment #287752

I’ve never quite understood the concept of excess wealth.

In a hyper-inflationary economy and collapsing government, sewing up hard assets in a mattress might be a good idea.

Even the casual reader of politics knew and understood that the Death Tax was a special interest lobby nugget for the extremely wealthy.

While I think it’s fair to wonder if Health care costs will actually be lowered (or at least the rate of increase). What is important to me is portability, elimination of pre-existing clauses, and universal health insurance to make the pool large enough to pay for itself. Health care rationing on some other basis than wealth must also be an agenda, at some point.

The game of pool definitions, via exclusions and denial of legitimate claims to turn a profit, has to stop.

Posted by: gergle at September 8, 2009 11:42 PM
Comment #287759

Christine

Democrats are in power at the moment…the spotlight is on them, and that is as it should be. But, being corrupt on taxes…being corrupt in business…being corrupt in religion…being corrupt in politics, is NOT a Democrat phenomenon. People in high places are sometimes tempted beyond their capacity to resist. Those people, be they Rangle or DeLay should pay for their transgressions. Meanwhile, when someone who is corrupt causes something good to happen does not mean the good thing should be abandoned. If you want a piece of Rangle, go after him, and I’ll help you. I don’t want corruption in high office any more than you do. Your position that because Rangle is a bad taxpayor and that his national tax positions are wrong because he is a bad guy does not float.

Posted by: Marysdude at September 9, 2009 6:42 AM
Comment #287763

Royal Flush-
One of the key components of a number of the key health reform plans is setting up an exchange, where multiple insurance companies compete for the consumers dollar. The much misunderstood public option is one voluntary aspect of that, meant to put pressure on these insurance companies to lower their rates, raise their efficiency.

propitiation-
I believe in a model of capitalism where everybody’s better off when you don’t have a large segment of the population unable to buy into or participate within the economy. Institutionalized poverty is a drag on productivity, a drag on the consumer markets, and a drag on those of us who have to deal with the rise in crime and social unrest caused by extremes of poverty.

As for liberal theology- YOU say it’s a theology. For people like me, it’s just politics, and its accorded appropriate reverence. Which is to say not nearly as much as you think.

As for this?

The goal of liberalism is to destroy the economy of America.

Well, if that’s the case, you darn Republicans have beaten us to the punch! But that’s hardly the case. The reality is, nobody wants to do something so politically stupid as wreck the economy. The main differences between the parties is their philsophy. Being that this is a practical endeavor, there is the capacity for one side to be more right than another, and as of right now, the Democrats have a better handle on things.

What’s a smokescreen here is all the BS that the Republicans throw up (including this charge that we want to destroy the economy) in order to avoid their own accountability for failing their stewardship of the economy.

As for tort reform? There, too, accountability is a factor. Some defensive medicine - that is, due diligence in making sure people remain healthy under their care - is not a bad thing. What we need is to stop treating people when they come to a crisis, and start treating them when they’re still healthy.

Posted by: Stephen Daugherty at September 9, 2009 9:15 AM
Comment #287781

Mr. Daugherty wrote; “One of the key components of a number of the key health reform plans is setting up an exchange, where multiple insurance companies compete for the consumers dollar.”

What he wrote was in response to my citing California as an example of non-competition with only six of nearly 1300 health insurance companies being allowed to compete in that state.

I would ask, why do we need another layer of government in the form of an “exchange” to force competition? All that needs to be done is abolish the regulations that now prohibit competition. Could it be more simple? Would the resistance to such changes be possibly tied to power and greed?

Let me for just a moment lapse into common sense about Medicare which is my primary coverage at age 68. I know full well that I am getting a tremendous health care bargain and paying far less in premiums than I should be with the young worker paying for much of my care. Thank you!

Another reason I am getting such a deal is that the cost of my care is carried on the government’s books as an “unfunded liability” which now totals about $37 trillion.

It is true that Medicare covers those with pre-existing conditions, is portable, and quite liberal in what it covers. Let us suppose for just a moment that our private insurance companies could operate in the same fashion and incur huge liabilities that far exceed their assets. Could they be just as generous. Of course they could. But…they would be bankrupt just as Medicare is.

When Medicare began in 1965 there were 5 workers for every Medicare recipient. Today there are only four and the Medicare Board of Trustees expects that by 2030 (just 20 short years away) there will only be 2.4 workers for every recipient.

I can not see any common sense in advocating we duplicate this coming train wreck with Medicare in a scheme of national health care for everyone. It is totally irrational to believe that Medicare can ever be financially sound without a severe reduction in coverage and huge increase in payroll tax.

I understand that the under age 65 crowd want the same benefits as I have with Medicare. Why wouldn’t they? And, I wonder if they understand what that will cost them if their coverage is actually paid for in payroll premiums.

My friends, nothing is ever truly free. Someone must always pay. I am not paying my fair share for Medicare and the debt keeps rising. Add another 50 million to the ranks of the “privileged” and it will fail much sooner.

Think of Medicare as a cruise ship with a gaping hole in its hull. One hundred passengers are enjoying the cruise because 400 passengers are below decks bailing water.

Posted by: Royal Flush at September 9, 2009 2:21 PM
Comment #287783

Mr. Daugherty wrote; “One of the key components of a number of the key health reform plans is setting up an exchange, where multiple insurance companies compete for the consumers dollar.”

What he wrote was in response to my citing California as an example of non-competition with only six of nearly 1300 health insurance companies being allowed to compete in that state.

I would ask, why do we need another layer of government in the form of an “exchange” to force competition? All that needs to be done is abolish the regulations that now prohibit competition. Could it be more simple? Would the resistance to such changes be possibly tied to power and greed?

Let me for just a moment lapse into common sense about Medicare which is my primary coverage at age 68. I know full well that I am getting a tremendous health care bargain and paying far less in premiums than I should be with the young worker paying for much of my care. Thank you!

Another reason I am getting such a deal is that the cost of my care is carried on the government’s books as an “unfunded liability” which now totals about $37 trillion.

It is true that Medicare covers those with pre-existing conditions, is portable, and quite liberal in what it covers. Let us suppose for just a moment that our private insurance companies could operate in the same fashion and incur huge liabilities that far exceed their assets. Could they be just as generous. Of course they could. But…they would be bankrupt just as Medicare is.

When Medicare began in 1965 there were 5 workers for every Medicare recipient. Today there are only four and the Medicare Board of Trustees expects that by 2030 (just 20 short years away) there will only be 2.4 workers for every recipient.

I can not see any common sense in advocating we duplicate this coming train wreck with Medicare in a scheme of national health care for everyone. It is totally irrational to believe that Medicare can ever be financially sound without a severe reduction in coverage and huge increase in payroll tax.

I understand that the under age 65 crowd want the same benefits as I have with Medicare. Why wouldn’t they? And, I wonder if they understand what that will cost them if their coverage is actually paid for in payroll premiums.

My friends, nothing is ever truly free. Someone must always pay. I am not paying my fair share for Medicare and the debt keeps rising. Add another 50 million to the ranks of the “privileged” and it will fail much sooner.

Think of Medicare as a cruise ship with a gaping hole in its hull. One hundred passengers are enjoying the cruise because 400 passengers are below decks bailing water.

Posted by: Royal Flush at September 9, 2009 2:43 PM
Comment #287803

Stephen:

We have a fundamental difference of opinion. IMHO a person EARNS his/her money the money belongs to that person before it belongs to the government for redistribution. If you are for the death tax, why not make it universal and apply one rule to everyone so that we are treated equally? Equal rights and responsibilities would be achieved. I find it odd that liberals want to make and apply rules that effect everyone….else.

“But if you really look at it, how many people benefit, in their finances, in their wealth, from that inheritance tax abolition? Very few. From Healthcare? Very many.” IMHO this is a very strong set of statements. As long as many can benefit , few should lose their rights. Again, I view this as property rights. The monies and assets that have lawfully earned belong to an individual. If you want to tax this already taxed money, would it not be fairer to apply a simple income tax? I could at least understand this, but again to make everyone equal under the law, tax everyone in the same manner. I wonder who Karl Marx would agree with?

“Ultimately, people must have money to pay for products, or pay off debts for what they finance. When you don’t GIVE(emphasis added) people enough money to do that, they can’t spend enough money at businesses to lead those businesses to return on their investment. The banks that invest in them can’t get their loans back. It’s a vicious cycle of cut-off circulation. And like any part denied good bloodflow, business and productivity atrophy.” This may be a bit of a misstatement, money should not be GIVEN, but earned.

“This is a tax on inheritors, those who often get these large sums for free, who could have been sitting on a beach in the Bahamas while the original owner did all the hard work- or alternatively , they could have helped every step of the way.” I am sure you must personally know people that have started businesses from scratch. Most have spent many 16+ hour days, six and seven days a week getting the business up and running . The inheritors at least have sacrificed their time with parents, so that their parents could provide a better life for them. Few people have the drive, savvy and determination to make it. The only ones getting something free are the many that will benefit from the sacrifice of the few.

Christine:

I generally agree with you on most topics, but I have to point out what IMHO is a failing in your stance on this topic. You are correct as to how this tax will impact your decision making, and have expressed it very well. But then you say, “I don’t care about the super rich. Tax the crap out of them for all I care. I bet most are Democrats anyway. I am talking about the almost rich or little rich. These are the ones who own the businesses, take the risks and create most of the new jobs.” How can you not see that the super rich are in the same boat that you are in? Do you not believe that to become super rich, one will probably start off a little rich or even almost rich at some point? Will taxing the crap out of the super rich not discourage someone in your shoes from taking the next step and providing even more jobs than you can? Or should this law apply to everyone else? Who should not have equal property rights, and more importantly, why?

Posted by: submarinesforever at September 9, 2009 7:43 PM
Comment #287808

Submariner

I understand that it is unjust to tax the super rich. But I recognize that envy is a very strong human emotion and if we have to propitiate the green eyed envy god on some occasions. Lefties demand it and if differences get too great or too persistent, others pile on.

You make a good point about the taxes on the super rich hitting others

Posted by: Christine at September 9, 2009 8:51 PM
Comment #287916

Super-rich got it, poor saps don’t got it…how much more simple can it get? Please do the math…

Posted by: Marysdude at September 11, 2009 10:00 AM
Comment #287917

PS:

Many times the reason super-rich ‘got it’ was by taking it away from the poor saps in the first place. If they are willing to take it away, they should be willing to give some back…taxing the poor is one of the stupidest concepts I’ve ever heard of. And, if he poor are not taxed, where are the operating funds going to come from?

Posted by: Marysdude at September 11, 2009 10:02 AM
Comment #287943

Marysdude:

“Super-rich got it, poor saps don’t got it…how much more simple can it get? Please do the math…”. So basically if people have worked harder, smarter or even just got luckier than you, you should just be allowed to take their property. I must apologize for not applying math to rights.

“Many times the reason super-rich ‘got it’ was by taking it away from the poor saps in the first place. If they are willing to take it away, they should be willing to give some back…taxing the poor is one of the stupidest concepts I’ve ever heard of. And, if he poor are not taxed, where are the operating funds going to come from?”. So the super-rich have stolen all of their monies. Did not earn it, but stole it. The hard work, long hours and dedication and sacrifice should count for naught, because they did not earn their wealth? Again, I view my time, labor and earnings as my property. I asked Christine, “Or should this law apply to everyone else? Who should not have equal property rights, and more importantly, why?”. Your answer is seriously lacking, but immencely insightful. We should take their property because they have it and we don’t….rights be damned.

Posted by: submarinesforever at September 11, 2009 4:59 PM
Comment #287945

You’ve got me crying again. Let’s get this as clear as I can make it…LIFE AIN’T FAIR…period. Poor people have no money, so taxing them is simply a dumb idea. Rich people have money, so taxing them makes a lot of sense. I doubt that the rich have worked any harder or gotten any dirtier than the poor. The basic difference is the rich got theirs and the poor don’t. Can you not add? Zero and zero makes zero…one and one makes two. What is so difficult about this math test?

Posted by: Marysdude at September 11, 2009 5:07 PM
Comment #287952

Marysdude:

Thanks, you have made my point better than I could have. Apparently rights and fairness have no place to some(IMHO most) on the left.

Posted by: submarinesforever at September 11, 2009 7:36 PM
Comment #287959

Marysdude

An honest response. Thanks for not piling on with the usual BS about justice.

It reminds me of the famous bank robber Willy Sutton. When asked why he robbed banks, he responded “because that is where the money is.”

There is a moral hazard with taxing some people to pay for others and asking some to pay almost nothing. It shows how much we despise someone if we expect nothing of him.

I respect anyone who works for a living, no matter what they do or how much they make. the problem is that we talk about helping the working poor, but give most to those who don’t. If you are in the poorest 20%, you really have nothing asked of you. This is corrupting for both society and the “happy” recipients.

Posted by: Christine at September 11, 2009 9:24 PM
Comment #287963

Ahhh, the bootstrap speech. With the added moral hazard speech. Of course we’ve not seen any problems with moral hazards lately in the top 20% have we?


I respect anyone who works for a living, no matter what they do or how much they make. the problem is that we talk about helping the working poor, but give most to those who don’t. If you are in the poorest 20%, you really have nothing asked of you. This is corrupting for both society and the “happy” recipients.

Having a grasp of reality is important in life. Being detached from it can lead to all kinds of problems with forming an opinion.

Who is the bottom 20%?

According to the 2005 census, those making below aproximately $21,000 a year. That would be about 60,000,000 people in the US.

An interesting chart can be found here

One might notice how the bottom 20th percentile remains flat, while the top 20th climbs dramatically.

Hmmm. Since everyone knows those top 20ers in the fifties were a bunch of lazy louts, it must be the hard work of gen-XYZer’s that has earned them an ever inflating portion of the pie. Couldn’t possibly have anything to do with corruption, political influence or theft, now could it?

No body asks much of the McDonald’s workers except, “Could I get some fries with that?” Been to McDonald’s lately? Notice how it is no longer just high school kids working there? Middle aged and elderly people seem to be highly represented there these days. Nobody ever asks much of them. Right? One of my first jobs was working in a restaurant. Hardest job I ever had.

I guess it helps if one understands what and who the working poor actually are, and where most Americans actually live, before one simply condemns them as lazy.

Posted by: gergle at September 11, 2009 11:51 PM
Comment #287965

Gergle

Hours worked rises with income. The lower 20% doesn’t make more because they are working less.

I have been in all the quintiles during my lifetime. I worked at McDonald’s when I was young. It is not much fun, but then that’s what you have to do. Today there are few teenagers working there. It is mostly immigrants in my experience.

You are right that I have trouble understanding “the poor”. I didn’t enjoy being poor, so I stopped. If you don’t drink, abuse drugs, are very lazy or extraordinarily unlucky, I really don’t understand how you can stay poor in America.

For most people I do not believe becoming not poor has anything to do with theft, politics or corruption.

Posted by: Christine at September 12, 2009 12:23 AM
Comment #287971

Christine,

For most people I do not believe becoming not poor has anything to do with theft, politics or corruption.

The problem with that belief isn’t about the method of becoming “not poor”. It’s missing the fact that “most” Americans are not becoming “not poor”. They are dropping in wealth, or becoming poorer. That’s what that chart shows.

It therefore follows it’s their drug use and laziness, or at least, by your bigoted logic it does.

I suppose if one never questions why the top 20% are becoming richer and the bottom 20% are becoming poorer, one never has to question the economics, biases and skew of American politics and society.

By the way, for that top 20%, do you have anything like a fact to assume work hours rise with income?

My feeling is you are correct in assuming that about the lower 50%, but I seriously doubt that statement for the top 20 percent.

Posted by: gergle at September 12, 2009 10:23 AM
Comment #287982

Gergle

You chart shows most Americans are making more than ever. The poorest 20% are making not much more. The next 20% are making a little more. The next 20% are making pretty much more. The best off are making a lot more. That doesn’t indicate anybody is being cheated.

If you and I are making the same money and then you find a better job that pays twice as much, how am I being cheated?

We have had massive immigration. Presumably many of them as happy to be making much more in the U.S. than back home, but it is unlikely they can jump immediately into higher brackets.

We went down to Washington today and ran into a very big demonstration. It was one of those tea parties. Ew

The quintiles are not strictly speaking equal. Households are larger among higher income households. You can see the numbers here . He is a graph of hours worked per quintile here .

Beyond all this, income levels are often reported pre-tax. Having been in all five quintiles, I can tell you from experience that you pay a lot more in taxes as you make more money, no matter what people tell you. You also lose a lot of tax benefits. For example, a couple years ago I got a tax credit when I paid my daughters tuition. This year, in a higher tax bracket, I got nothing for my two sons. If you are poorer yet, you can get financial aid.


Anyway, I don’t see equality as a goal. While I would prefer not having too much differences, I would be very artificial and unjust if everybody made the same income or near it.

As someone who has been in all five groups, I can tell you that I worked up to it. I am worth more today (in the 80% quintile), in terms of the contribution I can make, than I was twenty years ago, when I fell into the 40%.

Posted by: Christine at September 12, 2009 6:22 PM
Comment #287999

Christine,

If the charts befuddle you, perhaps you should just stop for a moment and consider what has been happening in America over the course of the past thirty years or so…between Sam Walton and Ronald Reagan, labor unions (that bastion of middle class) were gutted into virtual non-existence. Deregulation of finance and business, plus providing tax favors to those companies shipping jobs and facilities out of country, have reduced the working wage to the lowest since Pre- World War Two (adjusted for inflation). Less work…less pay equals more poor. Now toss in the financial fiasco and the book cooking under Cheney/Bush, and you have tent cities springing up around cities like dandelions in my yard.

Do you honestly believe the American Dream is still available? Gramm/Leach/Bliley, Sam Walton and Ronald Reagan killed the American Dream so dead it’ll never become undead. We can hope that even without the Dream, Americans can survive in good health and will begin once again to help each other.

The poor are increasing, the rich are becoming filthier, and the middle class is disappearing, and you are still dancing to the conservative jig.

Posted by: Marysdude at September 13, 2009 7:07 AM
Comment #288011

Marysdude

I explained the charts to you. If you cannot understand them, I cannot help you any more.

The median income has risen since 1980. That means that at least half Americans are doing better in real terms than they had back then. I have never heard anybody explain away this improvement,although some ignorantly get it mixed up with average and tell me that it is because the rich got richer.

The “working wage” is a poor measurement because most Americans have moved beyond it. My father made a “working wage” but it wasn’t as good as you remember. His job is gone; it was automated out of existence in 1976. I have a good job, better than my father. I work, but I am not a “worker” in the sense you seem to think. In the old days, most Americans were “workers”. Today most are skilled managers, technicians or office staff. You have to count all the wages and other income made by all Americans. If you do that, you see the median income has rise.

I believe the American dream remains, at least how I define it. I grew up poor and made it precisely during the period you mention. I have three kids, all of whom are doing just fine. They easily found good jobs.

I believe that an underclass has developed. I am sure we disagree about the causes. I see its root in the “reforms” of the 1960s, when we decoupled money from work for the poor and inadvertently encouraged the rise of social pathologies such as illegitimacy.

Another cause of inequality has been immigration. In 1965 the US was more native (i.e. population born in the USA) American than in any time in its history. This changed with immigration reforms. Immigrants are generally good for our country, but they have to be integrated and that takes time. Until they learn the skills of America, they tend to make less money.

I really don’t think you understand the word “conservative” you throw as an epithet. In the American context, it means conserving the tradition of small, efficient government that decentralizes decision making to the extent possible allow the people to use their own imaginations, intelligence and innovation to create wealth for themselves and others.

We rely on government to actually enforce its own laws, but not expand to include solving all life’s problems. We learned in the 1960s the perils of government overreach when it tries to micomanage society.

Probably the biggest practical difference between us is that you seem to believe that there is some kind of near-perfect end state. I don’t. We will always be in the process of becoming. You also seem to trust those who will run government to make smarter choices than you and I can. I know a lot of people who work in government and a lot of politicians. They don’t seem superior to me as a group. I won’t speak for you.

Posted by: Christine at September 13, 2009 10:14 AM
Comment #288014

Royal Flush-
There are two factors in that trainwreck you neglect. The first is the Republicans knowingly and willfully added additional liabilities to the system, without creating a means of paying for them. The second is that healthcare costs are outpacing inflation. Since Medicare pays for healthcare, the increases in the costs for healthcare, period, are transitive to healthcare under medicare.

In other words, make healthcare cheaper, and you make medicare cheaper.

We’re not making a second medicare. The Public Option, which will cover maybe five to ten percent of Americans, will be premium funded.

The exchange is for the people who get kicked off of traditional plans for one reason or another. The Public Option, in essence, is a last resort. What the Insurance companies hate about it, is that if it’s successful, they will have to lower prices and improve care to compete. That will cost them money.

And it will save Americans money.

The Public Option is not a Duplication of Medicare, though that might be in the cards if the Insurance Exchange doesn’t work. You say medicare is unsustainable, but does spending one out of every five dollars on healthcare that doesn’t make us healthier qualify as sustainable? No. And, as a matter of fact, like I said earlier, it’s unsustainability is one of the main reasons for medicare’s current unsustainble fiscal situation.

You misunderstand the intent and the direction of Obama’s policies, and therefore fight a phantom created by your party to convince folks with your honest concerns of something that’s not true.

Posted by: Stephen Daugherty at September 13, 2009 11:20 AM
Comment #288015

submarinesforever-
You put your money in a bank. That money belongs to you, right?

What prevents a bank from charging excessive fees to siphon off more than their fair share? What prevents them from charging exorbinate rates on a loan? What keeps dishonest companies from getting your information and making fake charges on your account.

Let’s talk real estate. What sets a certain parcel of land, a certain house as yours, besides your own ability to keep it by force? What says that a person can’t set up a tent on your front lawn, that somebody taking oil or other material from beneath your property without paying you for it?

Let’s talk stocks and bonds. What forces a broker or a company you’re invested in to tell you the truth about how the business you put money into? What prevents them from acting again and again in their own interests, before taking care of your own?

What defines a business as legal entity capable of raising money, suing and being sued? What protects investors from direct liability in that suit?

What enforce the terms of a will, ensures that the right inheritances get to the right people?

The list of things the government is involved in can go on. So let me put this plainly: I believe that people don’t realize how pervasive the role of government actually is in what people believe to be entirely free market operations. They think the government’s not involved, but even if they got everything they wanted, it would be heavily involved. Ultimately, framed this way, the question is not big versus small government, but what constitutes good, productive involvement by government.

Posted by: Stephen Daugherty at September 13, 2009 11:34 AM
Comment #288021

Stephen

We agree that government has many of the legitimate functions you mention, chief of which is to protect property rights. Government has a duty to provide rules and enforce them.

We have problems with big government when it tries to get into management instead of rule setting and when it starts to try to dictate outcomes.

I see some of this problem in one of your examples, when you talk about banks “siphoning off excessive fees and taking more than their fair share.” The government’s role it to ensure transparency and protect contracted rights. If you put your money in the bank, the bank has to treat you according to the agreements you make. But the “fair” price is not government’s business.

For example, it cost the bank the same to manage your account if you have $10 or if you have $1,000,000. What is a “fair” price for the bank’s service? They lose money on the small accounts, so a fair price might be very high compared to the value. They make money on the big accounts, they might charge nothing or actually pay for the big ones.

Posted by: Christine at September 13, 2009 12:40 PM
Comment #288030

Stephen:

Christine answered you better than I probably can, but since you addressed me, I will add my two cents.

“You put your money in a bank. That money belongs to you, right?”. Absolutely.

” What prevents a bank from charging excessive fees to siphon off more than their fair share? What prevents them from charging exorbinate rates on a loan? What keeps dishonest companies from getting your information and making fake charges on your account.”. The federal laws prevent this, to an extent, but competition and my responsibility to know what is happening with the legal charges levied against me and my ability to withdraw my monies give me the leverage to find the best deal for me. Please note that I am combining my rights and responsibilities! I realize that I must take the responsibility for my choices and live with the consequences, what is wrong with that? As a nation of rights, we must be a nation of responsibilities.

“Let’s talk real estate. What sets a certain parcel of land, a certain house as yours, besides your own ability to keep it by force? What says that a person can’t set up a tent on your front lawn, that somebody taking oil or other material from beneath your property without paying you for it?”. I will enforce my property rights. The full force of the government should back me. Now my question to you is what should happen if the full force of the United States of America is used to deny my property rights? Apparently some on the left(IMHO most) are willing to deny those same property rights. I ask again, who should be denied their property rights…and more importantly, why?

I am not making my arguement against all government. I say that the government has a great responsibility in ensuring that all rights be enforced. I am asking you why should anyone have rights based on a sliding scale based on race, religion….or income? Using a Star Trek question, which is greater, the needs and rights of the many, or the one? I argue that if the answer is the needs/rights of the many, then there are no rights for the one.

Posted by: submarinesforever at September 13, 2009 3:26 PM
Comment #288063

Christine-
I don’t oppose the market setting most prices, and have said as much. But I would say to you, look at the Credit Card market, with its extreme interest rates, it’s willingness to raise them for any reason, it’s deliberate piling on of fees and penalties well in excess of what people are willing to pay.

That’s literally taking money out of people’s pockets. If not that, it’s helping to force people into bankruptcy, which damages their credit, and forces them to pay more for their cars, their homes, and everything else financed.

You see that FDIC label that gets attached to banks? That program, which involves the Government taking over and cleaning up the bank’s finances the bank(essentially nationalizing it) and selling it off to another private owner, would be called socialism today, and would be roundly criticized.

Yet that system is a prime reason why folks who invested their money in many banks still have their deposits, despite the irresponsibility of the banks who misused the bank’s funds.

It is also one of the crucial reasons why we aren’t in some kind of economic depression, why there’s some kind of a capitalist system still left. If some kind of system like this had been in place for the big financial monsters that now dominate banking, we might have avoided much of this crisis.

But that, of course, would be what the Republicans call socialism, to be denounced as teh evil.

I’m a pragmatist. Most of the reason why I avoid socialism is because much of it doesn’t work as promised. But some programs that you could call socialist, some programs that set prices can and do work.

One of the reasons I resent the Republicans in Washington so much is that they seem intent on doing what is politically correct, what fits their rigid ideology, rather than be flexible enough to entertain solutions to problem. But worse than haveing painted themselves into that corner, they want the rest of to join them, and using what little power they have left, that’s what they’re trying to force.

Needless to say, people like me are not amused. They had their chance to make their system work. Maybe the general theory might have worked, but they never got beyond the politics to the practicality. They seem to just want to wait for things to turn out for the best, spend that extra time digging through the manure to find that pony.

Maybe my people will take the wrong approach. But if so, there are plenty of Democrats willing to tell them they are wrong, and not simply wait around for Mr. Ed to stick his head out of the you-know-what-pile.

submarinesforever-
I know this: people do not always pay attention. Yes, they should pay it as much as they can, but we give people other jobs and other roles to play, and sometimes people don’t have time to look over the shoulder of everybody they’re dealing with.

So, in my mind, there should be somebody whose job it to look over their shoulder. And the banks should know it.

As for our property rights? Under most circumstances, I think Government should leave it alone. But under special circumstances, there are times where the Governments enforcement of your property rights must be counterbalanced with the public interest.

Eminent Domain is one of the simplest examples, spelled out in the Constitution. I believe, though, that there must be a reason that the government should limit your property rights. Mostly it has to do with what belongs to all of us: the environment, like the rivers, the oceans and the air, resources that are scarce, yet indivisible, like the radio spectrum. The protection of species close to extinction is necessary, because that is a resource held in common, one that can never be brought back, if your interests are left unrestrained.

Most liberals, I would tell you, are just as interested in THEIR property rights are you are in yours. Liberals aren’t saintly and aren’t free of desire for worldly possessions. And you know, despite what the irresponsible and the careless say, we’re not mostly looking to redistribute the wealth of the rich all to ourselves. Most people are just looking for a comfortable, stable, middle class existence with a decent chance of upwards mobility.

This is what has been demonized as socialism and class warfare. Well, let me tell you: folks would leave the rich alone more if they didn’t fight so hard to find a way to take more of what we already get without giving more back.

Posted by: Stephen Daugherty at September 14, 2009 12:45 PM
Comment #288079

Stephen:

“As for our property rights? Under most circumstances, I think Government should leave it alone. But under special circumstances, there are times where the Governments enforcement of your property rights must be counterbalanced with the public interest.”. A person’s rights should be counterbalanced only by the RIGHTS of another, not interest. And yes, “Eminent Domain is one of the simplest examples, spelled out in the Constitution.”. I live in an area where the use of eminent domain for the TVA has given us the ability to live in a modern world. But it does not stop there. Many cities and States are now taking private property away from one individual and giving it to another so that important things like malls, Lowes and Wal-Mart can be build to increase tax revenue. The courts have been used to enforce these decisions. Now I know that you may or may not agree with this practice when taken to these extremes, but that is the best example that I can think of to demonstrate the difference of opinions about property rights vs. public intrests.

“This is what has been demonized as socialism and class warfare. Well, let me tell you: folks would leave the rich alone more if they didn’t fight so hard to find a way to take more of what we already get without giving more back.” I have addressed this ealier in post 287943 with marysdude. This is going down the same path, so I will just repost and allow you to answer the question, if you choose to do so.


Marysdude:

“Super-rich got it, poor saps don’t got it…how much more simple can it get? Please do the math…”. So basically if people have worked harder, smarter or even just got luckier than you, you should just be allowed to take their property. I must apologize for not applying math to rights.

“Many times the reason super-rich ‘got it’ was by taking it away from the poor saps in the first place. If they are willing to take it away, they should be willing to give some back…taxing the poor is one of the stupidest concepts I’ve ever heard of. And, if he poor are not taxed, where are the operating funds going to come from?”. So the super-rich have stolen all of their monies. Did not earn it, but stole it. The hard work, long hours and dedication and sacrifice should count for naught, because they did not earn their wealth? Again, I view my time, labor and earnings as my property. I asked Christine, “Or should this law apply to everyone else? Who should not have equal property rights, and more importantly, why?”. Your answer is seriously lacking, but immencely insightful. We should take their property because they have it and we don’t….rights be damned.

Posted by: submarinesforever at September 14, 2009 6:02 PM
Comment #288092

Stephen

Credit cards are things most people need to rent cars etc. But if you don’t pay them off every month, you are a fool and a fool and his money are soon parted. In the long run the bottom line is, credit card or not, if you spend less than you make, you will be solvent. If you spend more than you make, you will be poor.

Posted by: Christine at September 14, 2009 11:01 PM
Comment #288174

Christine, such simplistic idealism. Bankers spent trillions in investments more than they made and had as capital, and voila, they are none the poorer. Hell, they are even all still employed receiving monumental salaries and compensation packages. That’s a function of unregulated capitalism in which corporations are in bed with government politicians.

Did the head of CountryWide have to give up his ill-gotten gains? No. How about the executives of Lehman Bros.? No, again. Our government spends more than it takes in under both Republicans and Democrats, and yet they continue to vote to raise their own salaries.

Sorry, but, your comment is so lost in fantasyland and devoid of contact with reality as to be ludicrous. It is the American Dream to go into debt to start up a company or business and come out of the process as a multi-millionaire. Many have become wealthy by first going into debt. It is a story as old as the Constitution in America. The very founding of our nation and Revolutionary War was funded on the principle of spending more than we were taking in. All of the Colony’s wealth remember, legally belonged to the King according to the Loyalists of which there were many in the Colonies.

Posted by: David R. Remer at September 15, 2009 4:34 PM
Comment #288349

submarinesforever-
I am of the belief that you really can’t have a government where nobody’s ox gets gored, nobody’s rights are traded for another person’s. The question of where the balance is struck between the interests cannot, in my view, be answered just with a top level constitutional approach. There is too much complexity in the real world to do things that way.

But I think if you can legislate in one direction, you can legislate in another. The only difference is, people reach for Constitutional power because it’s permanent. Once the judgment’s been passed, the amendment ratified, there’s no way for somebody to just simply come around and reverse it without equal and opposite application of the process.

Too many on the right are not content to play the tug of wars with the Democrats on the policy, but rather would try and cut us out entirely, invoking constitutional arguments as a means of taking practices accepted for the better part of the last century and rolling them back.

But these interpretations and these policies were often set up for a reason, reasons often long forgotten by Republicans who see, most with sincerity and honest questioning, just impediments to economic progress.

What many on the right failed to realize is that the market is not rational, and the market by itself is insufficient to determine who has what rights, and whose interests are seen to and whose are not. Too often, when we apply laissez faire standards, it’s the little people like us, the middle class and poor who get screwed. After all, without the resistance of government in place, what else would triumph, besides those who have power backing their play already?

The Market cannot triumph where we do not make the decisions, or where the market itself is saturated with those who profit from their dysfunctional behavior.

Christine-
It’s easy to say that. But what, for example, happens when the credit card company moves your due date for your bill without telling you? Oh darn, they say, I guess we have to charge you interest. Oh, and if you’ve been late on somebody else’s bill, or gotten into trouble on another card or something… well I guess you’ll just have to live with your higher interest rates.

You’re right to want to pay them off. But you should consider that these people are exploiting the not so savvy consumers, exploiting even responsible cardholders, and lobby in Washington to keep many of their predatory practices legal.

Whether or not you like it, folks in an economy don’t always look out for themselves, and can’t always look out for themselves. Whether we like it or not, we have to deal with this, or we will see more BS like we see with the Economic collapse of last year. Predatory systems like this are about creating profits on paper by inflating what people owe, no matter how far that is beyond people’s means, and endlessly hedging that near certain inability to pay out of existence. It works until enough people become unable to pay, unable to keep things moving, that the system falls into disarray.

Either we can discourage this with better legislation, better regulation, and better enforcement, or we can watch as the inevitable irrationalities of the market create chaotic convulsions of wealth-destroying bubble-bursting.

Posted by: Stephen Daugherty at September 19, 2009 9:09 PM
Post a comment