Tax Tricks
February 27th 2009 18:56
Obama claims he's going to reduce the annual deficit by half by the end of his first term, but it's all smoke and mirrors. He claims he'll do this through tax hikes on the wealthy and closing loopholes, etc. What he's saying doesn't match either what he's doing or reality.
The top 1% of Americans earn 22% of the income earned in the country but pay 40% of the income taxes. That same link shows you that the top 2%, those making more than $200,000 a year, pay 62% of the income taxes collected in the country.
If you taxed the top 2% at 100% of their income, obviously impossible but stay with me, the government would collect a total of $1.4 Trillion, not even yet equal to the Obama deficit of $1.75 trillion. You'd have to tax everybody making $75,000 a year or more at 100% to equal Obama's budget.
Now you're thinking "ha! not only individuals pay taxes! Some of it comes from business!"
Absolutely true! However, no business pays taxes. No business pays one single cent in taxes.
"But, Jon, how can that be true, of course they do!"
Nope, taxes are a cost factored into what they sell their products for! If you increase the taxes on oil producers, as Obama has in his budget by imposing additional taxes on American oil production, will they just keep their prices the same? No! They'll pass it on to us! If it costs more to produce oil, we'll pay more at the gas station! If it costs more to produce electricity, we'll pay more to the electric companies.
See the pattern?
How many of you work for a poor person? How many of you are employed by a "rich" person who makes $200,000 or more? That's what I thought. What percentage of Americans are employed by poor people . . . ?
There's no way Obama can raise taxes enough to cut the deficit in half after increasing the budget by 25% and adding in TARP, TARP II, the spendulous bill, and the omnibus spending bill. Absolutely no way, these real figures prove it.
But there's another aspect to this. If you raise the captial gains from 15% to 20% will revenue from it increase by 33%? Nope. History has proven that when you increase the tax, there's less investing and you collect less revenue. When Bush cut it to 15%, capital gains tax incomes soared. Add in the fact that for at least the next few years almost nobody will even be able to make a gain on capital investments and there will be no more taxes from it.
And don't even get me started on Cap and Trade, where carbon credits have to be purchased by energy and manufacturing companies, who will pass those costs onto us, so that "non-carbon producing industries" can have that tax given to them. Which companies get it? Why non-biased politicians not looking for reelection will decide which companies in which states get it! Don't you feel better? All you have to do to get money from evil coal companies is give to a congressional campaign if you have any money left from your electric bill doubling!
Will the rich pay those taxes? Nope, they will find more creative ways to "hide" their money. Small business people will do more cash transactions to hide income. The very rich will put more money in the Caymans since the Obama administration is forcing Switzerland to stop hiding names of American account holders. They will pass the expenses onto their employees, maybe letting a housekeeper go or not buying planes and cars and houses, further costing jobs and spending. If you lost an additional 10% of your income, would you keep spending the way you do?
75% of spending in America is done by the top 25% of incomes. If you take more money away from them, spending will go down. If spending goes down, people lose jobs, and not the rich. The people who lose their jobs, and we saw this during the short time Clinton had a luxury tax, are the people on the assembly lines at yacht manufacturers, plane factories, catering companies, etc.
The rich aren't hurt, we are. The only industries that will gain income from these tax changes are accountants and lawyers. EVERYBODY ELSE will lose jobs, see the cost of items go up, etc.
Here's the final reason it won't work:
These changes will further hurt the economy, further depressing it, thus reducing incomes and REDUCING how much money is coming into the treasury. If more people are losing their jobs and companies are passing their taxes onto us, the income and corporate taxes will continue to fall as more and more companies fail as we have less and less to spend.
Don't think your taxes are going up? Maybe not out of your paycheck, but you'll see it at the grocery store, gas station and mall. Oh, maybe you won't see it if deflation happens as bad as many, many economists say it will, but that deflation means massive drops in revenue for the government which means even more rapid deficit growth.
Then why is he doing this? Because most of those people hurt by this through job losses or loss of buying power or the other effects of a bad economy will turn to the government for help, and then the liberals have them. Liberals are building up their voting block.
As I've pointed out before, equality through socialism means equally poor. Socialism breeds laziness. People become too lazy to innovate and take chances because the government is taking care of them. It's immoral because of what it does to people.
Nancy Pelosi flew to Italy to dine in Florence and have the Pope tell her that her stance on abortion is a sin and she will be held extra accountable by God because she is in power on a taxpayer funded Gulfstream private plane. Not one story on the mainstream media. Bank of America's CEO flies to New York on a private plane and he's raked over the coals. I'm sorry, the billions BofA is spending in taxpayer dollars is dwarfed by the trillions Nancy spends.
And one more warning: The $13 a week you may start seeing in your paycheck in April is taxable at the end of the year. If you're a person that pays taxes (you don't get every penny you paid in taxes back when you do your return), that $13 a week will count as income. It's a credit, not a tax break. Check with an accountant. I work for one and it's true.
You can support my blogging even more by buying my book at Author House. Unlike liberals, this is the only fantasy world I live in
The top 1% of Americans earn 22% of the income earned in the country but pay 40% of the income taxes. That same link shows you that the top 2%, those making more than $200,000 a year, pay 62% of the income taxes collected in the country.
If you taxed the top 2% at 100% of their income, obviously impossible but stay with me, the government would collect a total of $1.4 Trillion, not even yet equal to the Obama deficit of $1.75 trillion. You'd have to tax everybody making $75,000 a year or more at 100% to equal Obama's budget.
Now you're thinking "ha! not only individuals pay taxes! Some of it comes from business!"
Absolutely true! However, no business pays taxes. No business pays one single cent in taxes.
"But, Jon, how can that be true, of course they do!"
Nope, taxes are a cost factored into what they sell their products for! If you increase the taxes on oil producers, as Obama has in his budget by imposing additional taxes on American oil production, will they just keep their prices the same? No! They'll pass it on to us! If it costs more to produce oil, we'll pay more at the gas station! If it costs more to produce electricity, we'll pay more to the electric companies.
See the pattern?
How many of you work for a poor person? How many of you are employed by a "rich" person who makes $200,000 or more? That's what I thought. What percentage of Americans are employed by poor people . . . ?
There's no way Obama can raise taxes enough to cut the deficit in half after increasing the budget by 25% and adding in TARP, TARP II, the spendulous bill, and the omnibus spending bill. Absolutely no way, these real figures prove it.
But there's another aspect to this. If you raise the captial gains from 15% to 20% will revenue from it increase by 33%? Nope. History has proven that when you increase the tax, there's less investing and you collect less revenue. When Bush cut it to 15%, capital gains tax incomes soared. Add in the fact that for at least the next few years almost nobody will even be able to make a gain on capital investments and there will be no more taxes from it.
And don't even get me started on Cap and Trade, where carbon credits have to be purchased by energy and manufacturing companies, who will pass those costs onto us, so that "non-carbon producing industries" can have that tax given to them. Which companies get it? Why non-biased politicians not looking for reelection will decide which companies in which states get it! Don't you feel better? All you have to do to get money from evil coal companies is give to a congressional campaign if you have any money left from your electric bill doubling!
Will the rich pay those taxes? Nope, they will find more creative ways to "hide" their money. Small business people will do more cash transactions to hide income. The very rich will put more money in the Caymans since the Obama administration is forcing Switzerland to stop hiding names of American account holders. They will pass the expenses onto their employees, maybe letting a housekeeper go or not buying planes and cars and houses, further costing jobs and spending. If you lost an additional 10% of your income, would you keep spending the way you do?
75% of spending in America is done by the top 25% of incomes. If you take more money away from them, spending will go down. If spending goes down, people lose jobs, and not the rich. The people who lose their jobs, and we saw this during the short time Clinton had a luxury tax, are the people on the assembly lines at yacht manufacturers, plane factories, catering companies, etc.
The rich aren't hurt, we are. The only industries that will gain income from these tax changes are accountants and lawyers. EVERYBODY ELSE will lose jobs, see the cost of items go up, etc.
Here's the final reason it won't work:
These changes will further hurt the economy, further depressing it, thus reducing incomes and REDUCING how much money is coming into the treasury. If more people are losing their jobs and companies are passing their taxes onto us, the income and corporate taxes will continue to fall as more and more companies fail as we have less and less to spend.
Don't think your taxes are going up? Maybe not out of your paycheck, but you'll see it at the grocery store, gas station and mall. Oh, maybe you won't see it if deflation happens as bad as many, many economists say it will, but that deflation means massive drops in revenue for the government which means even more rapid deficit growth.
Then why is he doing this? Because most of those people hurt by this through job losses or loss of buying power or the other effects of a bad economy will turn to the government for help, and then the liberals have them. Liberals are building up their voting block.
As I've pointed out before, equality through socialism means equally poor. Socialism breeds laziness. People become too lazy to innovate and take chances because the government is taking care of them. It's immoral because of what it does to people.
Nancy Pelosi flew to Italy to dine in Florence and have the Pope tell her that her stance on abortion is a sin and she will be held extra accountable by God because she is in power on a taxpayer funded Gulfstream private plane. Not one story on the mainstream media. Bank of America's CEO flies to New York on a private plane and he's raked over the coals. I'm sorry, the billions BofA is spending in taxpayer dollars is dwarfed by the trillions Nancy spends.
And one more warning: The $13 a week you may start seeing in your paycheck in April is taxable at the end of the year. If you're a person that pays taxes (you don't get every penny you paid in taxes back when you do your return), that $13 a week will count as income. It's a credit, not a tax break. Check with an accountant. I work for one and it's true.
You can support my blogging even more by buying my book at Author House. Unlike liberals, this is the only fantasy world I live in
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Comment by S.L.
The Political Brief
My husband loved your book and as soon as I get settled in the new place, I'll get to finish it. Good job!
Comment by Jonathan Biviano
Politics Realm
Marriage Bits
I'm glad you're enjoying my book. I would love for those sales to take off
BTW, my personal prediction is that the stock market will be under 3,000 by 2012.