The Poor pay More in Taxes than the Rich

[FocusWiz]

It's not just liberals. The populace complains about lack of jobs or a lackluster economy or lack of loans or high interest rates or communist activities in nearby countries or lack of alternatives to fossil fuels, etc. The government creates incentives to spur private activities in the form of interest free loans, reduced fees, or tax credits and faster write offs. Companies take advantage of these and reap increased profits or lower taxes and we demonize them. Banks were encouraged to make risky loans to South America and for home mortgages. They lost a ton of money. We act as if they lost money deliberately and then asked for a bailout. Both the Republicans and Democrats knew that "free money" got them votes. We talk about how the banks got favorable legislation by helping campaigns. It also works the other way around. The banking industry can be threatened with tighter regulations if they don't make cheaper loans. Bankers are more Mr. Mooney or Mr. Drysdale than Robin Hood.

Companies who are allowed huge investment credits or capital investment write offs or energy credits may not pay "their fair share" of taxes, but frequently they are responding to government incentives as part of a larger social policy goal.

I am not saying that the banks (or any large company) are good. I just find it odd that we ignored the actions of the federal government when we marched on Wall Street against the wealthy bankers who were ripping off the country. 90% of the hated bank employees probably made less than the protestors. Likewise, we ignore the goals of legislation that resulted in a company having an abnormally low tax liability when we rant against the evil company that complied with those incentives.

[Tom]

GE, huge contributor to Obama.
There ya go.

[pandy]

Originally Posted by Tom

GE, huge contributor to Obama.
There ya go.

Exactly. These companies grease palms in Washington and get tax breaks. The system is broken.

[newtothegame]

Originally Posted by Tom

GE, huge contributor to Obama.
There ya go.

And, wasn't Jeff Imelt some come of advisor to Obama.....??? Head of GE?
Hmmmm seems like a cohesive unit!!!!

[badcompany]

Liberals bring up GE as though it's an example of everything wrong with capitalism, when he company is a classic example of crony capitalism. Europe is full of companies like this that have been around forever and are "friends" of government.

Here's a company tha has no European counterpart, Google. It pays ~2.5 billion a year in taxes in addition to the value it create for all of us.

Do we really want to make a company like this smaller so that government can be bigger?

[FocusWiz]

The difference between a "growing" company and an established and somewhat stagnant company are dramatic. A growing company is seldom afraid to take risks and will write off their losses on failed attempts without risking a stockholder revolt since revenues will continue to climb to offset these losses. At one such company I worked for, their goal was to spend a minimum of 10% on training and development for just this reason.

A company like GE or Exxon/Mobil or JPMC or Citicorp is more concerned about market share and investor relations. A loss due to a failed venture can only be tolerated if other firms in the same industry are similarly impacted. They focus on squeezing the last dollar out of existing endeavors by cutting costs rather than investing in growth and new products. In reality there is limited potential for growth of companies of this size. This is part of the reason why they turn to Washington to improve their profit margins by reducing their expenses.

Recent changes in capital requirements by the Fed will significantly impact how much firms like JPMC have to invest. Look for them to seek even more legislation that favors them as they need to raise over $20 billion in the next five years to meet these requirements.

[horses4courses]

[horses4courses]

[Saratoga_Mike]

The primary cause of income equality is educational disparities. Period. I believe I can even find a quote from Bill Clinton saying as much.

What party wants to deprive poor minority kids a chance in life? That would be Dems. (Union) votes are more important than kids. Disgraceful.

[Mike at A+]

Originally Posted by Saratoga_Mike

The primary cause of income equality is educational disparities. Period. I believe I can even find a quote from Bill Clinton saying as much.

What party wants to deprive poor minority kids a chance in life? That would be Dems. (Union) votes are more important than kids. Disgraceful.

SPOT ON. Dems LOVE to focus on INCOME inequality but they ignore all the other inequalities like education, work ethic, ability to adapt, ability to stay out of trouble and SO MANY OTHER qualities that lead to a better life. There comes a point in life where it's too late for many to achieve that better life. And in the overwhelming majority of those cases, they have no one to blame but themselves. Running a distant second for the blame is the culture where the baby daddy leaves to spread his seed elsewhere and the single mom who makes bad choices.

[horses4courses]

[Mike at A+]

Originally Posted by horses4courses

Yeah, that all sounds great on the surface. But what would happen if things were different? How many jobs would be lost? What about professional sports? Why don't you have anything to say about an NBA player making an obscene amount of money? Or a singer? Loopholes exist for a reason. The government gets something in return for those loopholes.

[Mike at A+]

And as long as we're posting cute memes ...

[Track Collector]

Originally Posted by horses4courses

Here's some more math, in absolute terms:

In one of the groups mentioned above each person paid $180,000,000 in taxes, while the other group each person paid $8,000 each.

Your position might have been better argued if you insisted that the first group pay at a 20% rate (same as the second group) rather than 39.6%

The entire issue is a moot point as our government continues to run up huge debt. Without any serious attempt to reduce spending, some day in the not too distant future the entire system is going to come crashing down.

[AndyC]

Originally Posted by horses4courses

Of course a person making $40,000 would be paying at a 15% rate and a hedgefund manager would be paying at 23.8% but why let facts ruin a good rant.