Bloomberg.. how tax cuts are tax increases

[ljb]

Interesting link explains how the tax cuts ? Will actually amount to tax increases for most Americans.

Snip


Oct. 4 (Bloomberg) -- While purring about middle-class tax breaks, U.S. lawmakers who backed them ignored how the cuts would further accelerate state and local tax increases.

The $146 billion ``Working Families Tax Relief Act of 2004'' -- passed by Congress on Sept. 23 -- will actually increase the total tax burden for most households.
__________________
For complete editorial click on this link.
How U.S. Income Tax Cuts Are Really Tax Increases: John Wasik http://quote.bloomberg.com/apps/news?pid=email_us&refer=columnist_wasik&sid=aUfkWACqky5c

[superfecta]

if this writer actually believes that if the federal goverment reduces your tax,that forces the state to increase your tax.Note to those who believe this,it does not matter no matter how much tax your state collects it is never enough.When the state gov or feds for that matter happen to get a surplus,they raise spending.
And for that note about property taxes,I doubt he even owns property.At least he never actually tried his advice,even though its possible that the state would adjust your taxes,reality shows they raise it more than they lower it.

[Equineer]

Barring anarchy, voters always pay for what their elected governments spend. A tax cut that produces a deficit ultimately increases total tax burden because it adds continuous debt interest until the deficit burden is retired.

Whenever there is an outstanding deficit obligation, voters should demand promises about spending rather than tax cuts.

Why don't voters seem to realize that a deficit obligation is just like a city, state, or national credit card balance? Once you borrow, you pay and pay and pay... until you pay the damn thing off.

[Lefty]

Our Govenor increased taxes and then we find out, like many states we have a surplus. So lbj, you easily are swayed to the leftist position that tax cuts are bad.
Get this: When Kerry increases taxes, taxes surely will go up. That's for sure. Earth to lbj!
Eq, remember the liberal panic about the Reagan deficits? And then in 94 the Republican congress came along and the economy hummed and Clinton took the credit and the deficit was reduced. We will do that again. Just stop the whining and let Bush and the Republicans do their work.

[Equineer]

Lefty,

Our current national debt exceeds $7-Trillion, or more than $115,000 per census family.

Interest on this debt is paid every year... as sure a clockwork.

An annual deficit merely increases this total debt burden.

A perfectly balanced budget doesn't decrease this debt. Only tax surpluses can reduce this debt.

You don't seem to distinguish between the management of an annual budget and our total debt.

Without forecasting a domestic economic disaster, Wall Street economists say that our recent federal tax cuts will add another $5.5-Trillion to our national debt by 2013.

You don't seem like the type who sits on an enormous credit debt, making minimum monthly payments until you can pass it on to your heirs. Why do you look at our national debt any differently?

Corporate income taxes now contribute less than 7% of federal income tax revenues, and big corporations are constantly finding ways to shift profits outside the jurisdiction of our tax laws.

When we owe $12.5-Trillion, or conservatively $175,000 per family, how are we better off than today? Who will bail us out?

Halliburton does business through subsidiaries incorporated in such tax shelters as the Cayman Islands, Bermuda, Trinidad and Tobago, Panama, Liechtenstein, and Vanuatu.

Vanuatu? A tiny group of mountainous islands in the South Pacific with only three industries: local fishing, subsistance farming, and development of Vila, the capital, as an international corporate tax shelter.

In 2002, Halliburton actually paid only $15-Million to the IRS... mere corporate pocket change, but a cruel joke on you and me.

[ljb]

Equineer,
Sound logical post. Why some can't see this is beyond me. It just appears some are so locked in on their candidate, they fail to see the truth when looking it in the face.

[PaceAdvantage]

OR, the truth may be much worse in the face of the alternative.

[Lefty]

Yeah, you quiver at the national debt but anytime anyone wants to reduce or eliminate any social prgms libs holler and yell. Can't have it both ways.
It's not a zero sum game, grow the pie(better economy) reduce the debt.
I have a few credit card pmts. When I have a good month at horses or wife gets raise they get pd dn or off. I grew my economy.
And a lot of the National debt is owned by us, Bond Holders and the like.
Look at Kerry's plans. His great illusions call for much more money than the Pres is spending. We need to grow the economy and get a handle on it(reduce some of the ornerous social prgms)and not elect a tax raiser to office.
BTW, those corps you rail about have employees and those employees pay taxes.

[Dan]

Please excuse my ignorance on this subject but we have always been reminded by the media about how much 'National Debt' we owe. It is almost like bad parents continually reminding a child how bad they were. More negative thoughts planted to make the general public paranoid.

Just 'who' do 'we' owe this debt to? The Federal Reserve? Other Banking/Financial Systems in the world?

I was always under the impression that we owed it to the Federal Reserve. If that is the case then isn't the Federal Reserve made up of Federal Reserve Banks which are privately held coporations? If that is the case then how could they even function with trillions being owed to them? Shouldn't we already be in bankruptcy by now? Why can't we just write it all off?

I know that it is a lot more complicated than this but just like when an individual has gone past their credit limits how can we as a country continue to spend money we don't have?

Dan

[ljb]

From Lefty,
Yeah, you quiver at the national debt but anytime anyone wants to reduce or eliminate any social prgms libs holler and yell. Can't have it both ways.

And which social (or any other programs) did the Bushites reduce in the last 3 years? I know Bush failed to veto a single spending bill. Including the rain forest in Iowa.

[schweitz]

Originally posted by buddy_love
Please excuse my ignorance on this subject but we have always been reminded by the media about how much 'National Debt' we owe. It is almost like bad parents continually reminding a child how bad they were. More negative thoughts planted to make the general public paranoid.

Just 'who' do 'we' owe this debt to? The Federal Reserve? Other Banking/Financial Systems in the world?

I was always under the impression that we owed it to the Federal Reserve. If that is the case then isn't the Federal Reserve made up of Federal Reserve Banks which are privately held coporations? If that is the case then how could they even function with trillions being owed to them? Shouldn't we already be in bankruptcy by now? Why can't we just write it all off?

I know that it is a lot more complicated than this but just like when an individual has gone past their credit limits how can we as a country continue to spend money we don't have?

Dan

We print more.

[Equineer]

Buddy_Love,

Actually, the government borrows by selling U.S. Treasury securities.

See the Debt Clock: http://brillig.com/debt_clock/

See the Treasury FAQ: http://www.publicdebt.treas.gov/opd/opdfaq.htm

[Lefty]

lbj, learn about baseline budgeting and congress.

[Dan]

Equineer,

Thanks for those links. There was a good pie chart and graph at:

http://brillig.com/debt_clock/faq.html

Interesting about how the government borrows from pension plans, foreign/international interests, commercial banks, and state/local governments.

I think we should be asking all these clowns from both parties in Washington what are you going to do about this debt? Do you have a plan to pay this off? Hold global bake sales or yard sales or something? :)

This is really hilarious when you think about it. Didn't a couple of years ago the government was bragging that we had a balanced budget? Then they sent out checks to everybody for the overage? Why didn't they apply that money to what we owed?

I know it is more complicated than that but still. Common sense tells you that this is going to catch up with us someday.

BL

[JustRalph]

Originally posted by buddy_love
Equineer,

Interesting about how the government borrows from pension plans, foreign/international interests, commercial banks, and state/local governments.

I don't think they actually "Borrow" from the pension plans etc. The pension plans have the choice on whether to participate or not. Same as the other categories you list...........

[chickenhead]

call it an investment.....the interest rate we (the government) have to pay the "investor" is a measure of what the perceived solidness of the bond is.....if you listen to financial folks talk about the worries of a big deficit/debt.....one of the signposts you hear them talk about is a "crisis" in the bond market...i.e. exploding interest rates....which means that we have to pay more to get our "investment" because the investee has fears about getting paid back.....at least fears that they may not get paid back in dollars worth the same amount of money....also if you listen to them you will hear that they are afraid that the bond market will not give you the proper warning as to when this crisis will happen....hence the need to control our deficits and debt NOW.

OTM al should really be posting here...I have a feeling he could shed some light on this issue for us all.....

[Tom]

From the debt clock webpage:
"The estimated population of the United States is 294,456,073
so each citizen's share of this debt is $25,187.62."

How many people in the world do you think would be more than happy to pay this much to live the USA as opposed to wehre they live right now. In many nations, Iraq amoung them until recently, people paid with thier lives to live in them. Yeah, the debt is horrendous, but you just can't put price tags on some things.
My share is less than one year's salary. I am not complaining.
I am happy to pay my taxes (well, not happy, but I am not complaining too loudly).

[Dan]

Here's probably another dumb question but are outsourced jobs paying taxes?

As what happened recently, when I called Time-Warner about my Road Runner service and the person I called was in New Delhi. Even though they are in New Delhi and working for Time-Warner are they paying U.S. taxes?

:confused:

[Steve 'StatMan']

I suspect if a person lives in New Delhi and works in New Delhi, even if for an international company, they probably pay taxes in India, not here. Sure aren't going to get deductions for U.S. Social Security (and the employer's matching half).

[Lefty]

What about foreign countries that outsource jobs here. For instance the Honda plant in Ohio. Those are american workers paying american taxes.