Tipping Point

[jgriff]

While gto is providing that evidence, maybe he will explain why the most productive years in US history, from the end of WWII into the 70s, also had the highest tax rates, some as high as 94%.

Were those years really the most productive? And if so, productive in what sense?

[jgriff]

While gto is providing that evidence, maybe he will explain why the most productive years in US history, from the end of WWII into the 70s, also had the highest tax rates, some as high as 94%.

I found a good article about this subject.

http://blogs.ft.com/maverecon/2007/08/us-productivityhtml/

It seems that productivity growth was at a high point in the 50s and 60s not productivity. We recently touched those highs again.

http://www.bls.gov/lpc/prodybar.htm

There are many reasons for the slow productivity growth in the late 70s and early 80s. Low taxes are probably not high on the list of causes.

[Original Timmy Chan's]

You have a twisted view of how the world works. In fact those who own the corporations - PAY THE MOST TAXES.

Hmmm...

Exxon Mobil made $35 Billion in profits last year, and paid ZERO DOLLARS to the US in income taxes.

GE received a tax RETURN of $1.1 Billion from the IRS last year.

And some have the gall to complain about families earning $20k/year not paying income taxes...

[TheNiche]

Hmmm...

Exxon Mobil made $35 Billion in profits last year, and paid ZERO DOLLARS to the US in income taxes.

GE received a tax RETURN of $1.1 Billion from the IRS last year.

And some have the gall to complain about families earning $20k/year not paying income taxes...

Technically speaking, that's true. But these are multinational companies, and their domestic business lines are not profitable. They aren't taxed on a loss, yet are still able to claim tax credits, deductions, and adjustments, not unlike a household in many respects.

As for their profitable international business lines, they don't owe taxes to the US government until they try to bring their foreign earnings back to the United States...and even then the specifics terms of tax treaties that we have set up with other governments play a large part in determining the extent of the tax liability owed to the US government as opposed to the foreign government in question.

EDIT: Also, gto250us made the claim that "those who own the corporations pay the most taxes", and that's a different kind of entity than the corporations themselves. There is a difference.

[gto250us]

If Jesus and Muhammad were to meet in a no rules smack down, who would win?

[AtticaFlinch]

If Jesus and Muhammad were to meet in a no rules smack down, who would win?

Jesus was pro tax. You know, give to Caesar what is Caesar's, and all...

I don't know where Mohammad stood on the issue.

If you're asking about a straight-up fist fight, I think Jesus' turn-the-other-cheek policy may give Muhammad a slight edge. As far as pound for pound beatings go though, I give the edge to that eight armed Hindu god. Hanuman, care to weigh in on this important taxation discussion?

EDIT: Also, gto250us made the claim that "those who own the corporations pay the most taxes", and that's a different kind of entity than the corporations themselves. There is a difference.

Are you sure the Supreme Court would back you up on that statement?

[RedScare]

Technically speaking, that's true. But these are multinational companies, and their domestic business lines are not profitable. They aren't taxed on a loss, yet are still able to claim tax credits, deductions, and adjustments, not unlike a household in many respects.

To borrow a phrase...

I find that difficult to believe. Please cite a source or otherwise clarify your statement.

[TheNiche]

To borrow a phrase...

Google "GE pays no taxes", and this is one of the more cogent hits:

http://money.cnn.com/2010/04/16/news/companies/ge_7000_tax_returns/index.htm

EDIT: I'm still waiting on you to satisfy my earlier information request, btw.

[RedScare]

I notice you chose the crappy GE and left out Exxon. Even more interesting is the fact that both companies made out like bandits with tax deductions and credits, just like the poor people that Marksmu was railing against. I hope to see him spewing venom against these deadbeats soon, lest he lose credibility.

[TheNiche]

I notice you chose the crappy GE and left out Exxon. Even more interesting is the fact that both companies made out like bandits with tax deductions and credits, just like the poor people that Marksmu was railing against. I hope to see him spewing venom against these deadbeats soon, lest he lose credibility.

Whereas GE actually noted a gain from income taxes, Exxon had a significant income tax liability. Check out their financials and see for yourself. This article actually indicates that Exxon and other oil companies tend to get screwed by the countries in which they must operate. Consequently, they pay more taxes as a percentage of net income than companies that operate solely in the United States.

EDIT: Still waiting on your own sources. Or were you just blowing smoke?

[AtticaFlinch]

This article actually indicates that Exxon and other oil companies tend to get screwed by the countries in which they must operate.

Do you think it would have been a conflict of interest had an NBC website run the same article?

Or can any website owned by a multinational corporation that likely benefits from those tax loopholes run that op-ed article in an ethical way?

[Marksmu]

Hmmm...

Exxon Mobil made $35 Billion in profits last year, and paid ZERO DOLLARS to the US in income taxes.

GE received a tax RETURN of $1.1 Billion from the IRS last year.

And some have the gall to complain about families earning $20k/year not paying income taxes...

Number of people employed DIRECTLY by Exxon Mobil in the US - 79,000 people

Unknown number of people employed indirectly by Exxon mobile - probably 4-5X that 79,000 number

Economic of impact of Exxon Mobile operating in the US - HUGELY POSITIVE

Economic impact of some guy washing dishes for $20,000 - close to zero

Ya - Im not too upset that our tax policy keeps these big companies here in the US. With the "global" economy, the US is taking away incentive to retain these big companies and just making it easier and easier for them to relocate where they dont have to deal with the ingrate liberals in this country.

Exxon paid taxes, they were just able to take credits b/c they have to operate globally, and frequently that means, paying a higher tax rate overseas than the US would have them pay...I guess you would prefer we tax them twice...once in the country they are located in, and then again when they try to pay someones salary here in the US. That makes a lot of sense...if your an effn idiot. Its more cost effective in that scenario to just get rid of the US employee and hire someone else in the country they are paying taxes in already.

Exxon MORE than pays its share here. "In 2008, Exxon's tax bill averaged about $318 million per day. And it paid those taxes at the very same time that the whiz kids on Wall Street, the geniuses at AIG, and the mavens at Freddie Mac and Fannie Mae, were begging Uncle Sam for multibillion-dollar life preservers in order to prevent financial chaos." http://www.usnews.com/opinion/articles/2009/02/11/exxon-big-oil-profits-evil-only-until-you-weigh-their-tax-bills.html

Those are taxes paid IN THE US - so what if they did not pay MORE in income taxes....they paid more than their fare share.

Your view is incredibly shortsighted.

[Fringe]

Number of people employed DIRECTLY by Exxon Mobil in the US - 79,000 people

Unknown number of people employed indirectly by Exxon mobile - probably 4-5X that 79,000 number

Economic of impact of Exxon Mobile operating in the US - HUGELY POSITIVE

Economic impact of some guy washing dishes for $20,000 - close to zero

Ya - Im not too upset that our tax policy keeps these big companies here in the US. With the "global" economy, the US is taking away incentive to retain these big companies and just making it easier and easier for them to relocate where they dont have to deal with the ingrate liberals in this country.

Exxon paid taxes, they were just able to take credits b/c they have to operate globally, and frequently that means, paying a higher tax rate overseas than the US would have them pay...I guess you would prefer we tax them twice...once in the country they are located in, and then again when they try to pay someones salary here in the US. That makes a lot of sense...if your an effn idiot. Its more cost effective in that scenario to just get rid of the US employee and hire someone else in the country they are paying taxes in already.

Exxon MORE than pays its share here. "In 2008, Exxon's tax bill averaged about $318 million per day. And it paid those taxes at the very same time that the whiz kids on Wall Street, the geniuses at AIG, and the mavens at Freddie Mac and Fannie Mae, were begging Uncle Sam for multibillion-dollar life preservers in order to prevent financial chaos." http://www.usnews.co...-tax-bills.html

Those are taxes paid IN THE US - so what if they did not pay MORE in income taxes....they paid more than their fare share.

Your view is incredibly shortsighted.

Shame on you for looking at the big picture instead of the short/narrow sided one offered in other posts. 

[AtticaFlinch]

Shame on you for looking at the big picture instead of the short/narrow sided one offered in other posts.

Well, the initial complaint was about income taxes and how low-wage earners shouldn't have a right to vote or something asinine like that.

I think Timmy's point was not that Exxon and GE are unimportant companies, but that we need to slow down, stop gnashing our teeth and stop crying for the blood of the poor. If income taxes are really the issue, then hey look (!), GE and Exxon aren't paying them either. I'm pretty sure it was more to draw out the hypocrisies of the initial complaint.

But that's just my interpretation.

[LTAWACS]

Well, the initial complaint was about income taxes and how low-wage earners shouldn't have a right to vote or something asinine like that.

I think Timmy's point was not that Exxon and GE are unimportant companies, but that we need to slow down, stop gnashing our teeth and stop crying for the blood of the poor. If income taxes are really the issue, then hey look (!), GE and Exxon aren't paying them either. I'm pretty sure it was more to draw out the hypocrisies of the initial complaint.

But that's just my interpretation.

Uh... I think corporations do indeed get taxed on income... first the corporation... then the worker of the corporation... double-taxation... unless this changed.... but I dont think it did.

[Marksmu]

Well, the initial complaint was about income taxes and how low-wage earners shouldn't have a right to vote or something asinine like that.

I think Timmy's point was not that Exxon and GE are unimportant companies, but that we need to slow down, stop gnashing our teeth and stop crying for the blood of the poor. If income taxes are really the issue, then hey look (!), GE and Exxon aren't paying them either. I'm pretty sure it was more to draw out the hypocrisies of the initial complaint.

But that's just my interpretation.

I see no hypocrisy - The corporation has a net positive effect - giving jobs, paying more than $300,000,000 every day in taxes of one kind or another, and contributing to employment and the general American system

The person making $20,000 likely not only pays no taxes, but also receives welfare of some kind....they generally contribute nothing at all to the rest of the people in the System, they save nothing, and will over their lifetime, take out of the system much much much more than they put in with their "other taxes" like property tax and sales tax.

The huge difference, is that EXXON contributes and has a net positive effect, while the 20,000 person has a net negative effect. One adds, one subtracts...its not hard to see that we have more and more subtracting, the debt is getting bigger, and things are getting worse.....the answer to that from the have nots and those who are net detractors from the system is to raise taxes on those who are contributing.

They get to vote for people who promise openly to redistribute others people wealth for their benefit. That is the whole problem, and the original statement, and nothing that any liberal on here has said changes the fact that, that is the reality of the situation we have gotten ourselves into. Once people know they can vote themselves other people property, it does not take long for everyone to get on board. Eventually nobody has anything, and the government runs it all....into the ground.

[AtticaFlinch]

The person making $20,000 likely not only pays no taxes, but also receives welfare of some kind....they generally contribute nothing at all to the rest of the people in the System...

If they contribute nothing, then why do they get $20,000?

Where can you draw a $20,000 salary without doing any work? I want several of those jobs!

[TheNiche]

The person making $20,000 likely not only pays no taxes, but also receives welfare of some kind....they generally contribute nothing at all to the rest of the people in the System, they save nothing, and will over their lifetime, take out of the system much much much more than they put in with their "other taxes" like property tax and sales tax.

Having been that guy when I was a student (and not receiving welfare or financial aid), I made a $20k per year job go a long way. I lived frugally, graduated college without any student debt or credit card debt, a mostly-paid-off car note, and savings which I used to leverage real estate investments almost immediately after having graduated. I also was able to translate that $20k job into a much more lucrative career...which got blown out of the water with the financial crisis.

I wish I could get that old job back (and tried), but it's in India now, and the savings go to someone who is paying a higher tax rate than I am. So...I guess Uncle Sam, the rich guy, and someone in the English-speaking Indian middle class win that round.

[Original Timmy Chan's]

Atticus hit it on the head with his interpretation of my posts. I will admit to having a nearsighted view of things...I'm nearsighted by nature, but I can see the hypocrisy of screaming about low income families not paying taxes when some of our biggest corporations do the same thing.

Mark, you say that these corporations DO pay taxes, well so does the guy making $20k/year. Corporation gets certain deductions/benefits to make a net income tax payment of zero dollars...same with the po folks.

Yes, these big corporations do have huge benefits to our economy...but they're doing it on the backs of all these people making $20k (or $30k or $50k or $80k or $100k) per year. The corporations can't make all their money without having someone do the detailed work to support it.

I personally don't think corporations deserve to be treated better than humans, but for some reason we tend to do so on many issues in this country. I think we should be a country of people first, and corporations second...but I don't think it works out that way in real life. Mark, your point about corporate and bank bailouts is just one example of that.

I'm not into redistribution of wealth by the government, but I think compensation in this country is out of whack. I don't think there's a person in this country that can justify a $100 million in compensation per year. If your company makes enough to pay you $275,000 per day (365 days per year), maybe you're charging too much.

[Marksmu]

Atticus hit it on the head with his interpretation of my posts. I will admit to having a nearsighted view of things...I'm nearsighted by nature, but I can see the hypocrisy of screaming about low income families not paying taxes when some of our biggest corporations do the same thing.

Mark, you say that these corporations DO pay taxes, well so does the guy making $20k/year. Corporation gets certain deductions/benefits to make a net income tax payment of zero dollars...same with the po folks.

Yes, these big corporations do have huge benefits to our economy...but they're doing it on the backs of all these people making $20k (or $30k or $50k or $80k or $100k) per year. The corporations can't make all their money without having someone do the detailed work to support it.

I personally don't think corporations deserve to be treated better than humans, but for some reason we tend to do so on many issues in this country. I think we should be a country of people first, and corporations second...but I don't think it works out that way in real life. Mark, your point about corporate and bank bailouts is just one example of that.

I'm not into redistribution of wealth by the government, but I think compensation in this country is out of whack. I don't think there's a person in this country that can justify a $100 million in compensation per year. If your company makes enough to pay you $275,000 per day (365 days per year), maybe you're charging too much.

I'm all about the government staying out of our business, but at the same time I do not see the point in a $100,000,000 compensation package either...its obscene. But, some guy probably had to work really hard to get to that point...or be born into it....but thats not the point....the point is that its better to just keep the government out of it all together.

The bigger point is that without these corporations, many of those 20,000-75,000/yr jobs dont exist. Most people are not smart enough, creative enough, willing to take the risk to start their own business...they actually prefer the safety of a job that pays them a salary, where their biggest fear is getting fired, not losing their whole investment, and destroying the lives of all the families who work for them. Starting a business is a lot of work, and it takes a lot of money, a lot of time, and carries with it a lot of risk. If its successful, and most are not, the reward is the money...its not the governments job to take that away.

The reason these corporations get such preferential treatment is because these corporation employ the humans.....all that you get from taxing a corporation, is the incentive for the corporation to make that money up somewhere else...another country, fewer employees, less investments, higher prices on its goods, etc....there is very little good that comes from taking from a corporation...its not "A" person, its a group of people...

The more money a corporation has the more money it can invest in the future....the more future investment, the better off everyone is. The same argument goes for income taxes on individuals as well, but were just complaining about corporations here....The more the government stays out of our pockets the more successful the country will be.

[AtticaFlinch]

Rectifying this (From another thread):

Of course, to your point, America has long since moved from promoting competitiveness to oligopolies.

Would solve this:

The bigger point is that without these corporations, many of those 20,000-75,000/yr jobs dont exist.

And defending the sanctity of corporations isn't the way to do it. Corporate consolidation leads to limited competition and therefore less innovation. And, as we've recently witnessed, putting all your eggs in one basket is stupid.

[RedScare]

The more money a corporation has the more money it can invest in the future....the more future investment, the better off everyone is. The same argument goes for income taxes on individuals as well, but were just complaining about corporations here....The more the government stays out of our pockets the more successful the country will be.

Actually, this thread was started by you to complain that the wealthy pay too much taxes. Now, you claim corporations should not pay taxes. In another thread, you complained of the budget deficit. The reason you are a lightning rod for criticism is that you have no ability to view the situation holistically. The government must have revenue to operate. Yet, you (and most Republicans) insist on lowering or eliminating taxes on everyone or everything that has the ability to pay them, while simultaneously claiming that the deficit is too large. Perhaps because you are a product of wealthy parents and grew up during the easy credit days you have no concept of balancing budgets, but your complaints conflict with each other.

Look at where the wealth in the US is concentrated.

http://sociology.ucsc.edu/whorulesamerica/power/wealth.html

The top 20% of US households control 85% of the total net worth in the US. Total financial wealth (not including one's home) is an even more staggering 93% of total financial wealth held in the top 20% of households. Yet you cry that the top 20% pay too much. Reality is that they pay only 86% of the taxes. The top 20% are actually paying LESS than the percentage of the wealth they control.

If you are capable of doing math, why don't you tell us how exactly YOU would balance the budget. Use REAL numbers, not the vague talking points of the news channels and tea partiers. I'd love to see it.

[KinkaidAlum]

I'm all about the government staying out of our business, but at the same time I do not see the point in a $100,000,000 compensation package either...its obscene. But, some guy probably had to work really hard to get to that point...or be born into it....but thats not the point....the point is that its better to just keep the government out of it all together.

No you are not. There are many threads on HAIF in which you want the government to butt into our business whether it be gay marriage, abortion, immigration, or a host of other things.

What you want is to stop paying your share via taxes but in return you still want solid schools, roads, air traffic control service, future access to medicare/social security, etc... but you want the working poor to pay for it.

Good luck with that.

What I want is a functioning government. Other countries tend to have them. A solid government can provide many of the things we need like public education, healthcare, public greenspaces, transportation, environmental protections, military protection, drinking water, and more. Unfortunately, we don't have a functioning government because one political party (Republican) seems hellbent on sabotaging the federal government so they can return to their base and rally them again around the idea that government is bad (but apparently not bad enough for the Repubs in DC to give up their salaries, access to publicly funded healthcare, or other such perks paid for by the tax payers).

[TheNiche]

Actually, this thread was started by you to complain that the wealthy pay too much taxes. Now, you claim corporations should not pay taxes. In another thread, you complained of the budget deficit. The reason you are a lightning rod for criticism is that you have no ability to view the situation holistically. The government must have revenue to operate. Yet, you (and most Republicans) insist on lowering or eliminating taxes on everyone or everything that has the ability to pay them, while simultaneously claiming that the deficit is too large. Perhaps because you are a product of wealthy parents and grew up during the easy credit days you have no concept of balancing budgets, but your complaints conflict with each other.

Look at where the wealth in the US is concentrated.

http://sociology.ucsc.edu/whorulesamerica/power/wealth.html

The top 20% of US households control 85% of the total net worth in the US. Total financial wealth (not including one's home) is an even more staggering 93% of total financial wealth held in the top 20% of households. Yet you cry that the top 20% pay too much. Reality is that they pay only 86% of the taxes. The top 20% are actually paying LESS than the percentage of the wealth they control.

If you are capable of doing math, why don't you tell us how exactly YOU would balance the budget. Use REAL numbers, not the vague talking points of the news channels and tea partiers. I'd love to see it.

Wealth is a claim to resources. People do not enjoy a claim to resources. That's just ink on paper. People enjoy the consumption that those claims can be traded for.

Look at where the consumer expenditures in the US are concentrated (and note that my source has a bigger dick than yours).

http://www.bls.gov/cex/2008/Standard/quintile.pdf

If you are capable of doing math, you will confirm my calculations that the top 20% of US households earn 50% of the total income in the US. Yet they enjoy only 38% of the expenditures. But there's another issue; higher-earning households are also larger households, tending to have more kids, more elderly, and a higher number of total earners. Individual earners in the top 20% of US households are responsible for generating the income that enables only 25% of consumer expenditures. To put that in perspective, the average individual enables $38,835 of consumption. The average individual earner out of a top-20% household enables the consumption of $48,502, but that consumption gets split between a greater number of non-earner mouths.

We all know that there's a greater disparity of consumption in our society than this dataset indicates. I can't make a cogent point using household data divided into quartiles according to income because I cannot isolate and compare households of similar demographic composition...and neither can you. And even if we could, our findings would necessarily be so wordy that they would not make good quips for internet propaganda.

[RedScare]

If you are capable of doing math, you will confirm my calculations that the top 20% of US households earn 50% of the total income in the US. Yet they enjoy only 38% of the expenditures.

Your math confirms that the wealthy have a greater ability to pay higher taxes (since they consume less of their income), making the case for a progressive tax system.

Thank you for saving me the trouble of finding the support for that conclusion.

[TheNiche]

Your math confirms that the wealthy have a greater ability to pay higher taxes (since they consume less of their income), making the case for a progressive tax system.

Thank you for saving me the trouble of finding the support for that conclusion.

My math confirms that my math is just as useless as yours is in attempting to quantify the issue...which was precisely my point. Neither of us is in a position to draw conclusions from the data that you were using.

As for your attempt at justifying a progressive tax, I'll back you up if you can demonstrate that savings does not become Investment, or that Investment is not related to long-term economic growth as measured from period to period in terms of aggregate income, aggregate employment, or aggregate wealth.