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Old 07-06-2011, 07:17 PM   #21
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Is that right? I don't have the numbers for taxes and spending, but I meant a true increase of 10% in tax rate at every level. 0% goes to 10%, 15% goes to 25%, 30% goes to 40%. Individual and corporate. That has to be more than 90B.
I pulled those numbers off the charts that MidPack posted in the other thread. Note that income taxes bring in around $900B - so 10% is ~$90B. Also note that total spending is around $3.5T.

If you want to increase rates to include an additional 10% of everyone's total income, I will ballpark that as a ~33% increase that would bring in around $300B extra per year. That would then drop the deficit by ~$800B per year including implementing the Bush tax cuts and the spending cuts mentioned. That's getting closer to the long term deficits.

One thing if you jack rates up that far, don't assume that people will act the same. You are likely to reduce economic activity and (perhaps) bring in less revenue than you think.

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Old 07-06-2011, 09:52 PM   #22
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I am fine with paying a bit more in taxes. After all, we did in the 90s. And the economy was almost certainly better then.
I dunno... I think government is doomed to expand just slightly beyond the limits of the tax revenue it collects.

I'd rather have it perpetually on the edge of insolvency. It seems to be the only way to stop ramping up the spending.
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Old 07-06-2011, 11:35 PM   #23
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We could also go a long way toward cutting social programs and saving even more.

Budget x government dollars for purchasing rice and beans. Distribute these at depots in every major city. Cut all welfare programs. If you are hungry, go get some rice and beans for free.

Costa Rica eats mainly rice and beans and has a lot lower obesity than the US.

Why do we give out $100 welfare credit cards that can be used at Walmart?
Because both the School Lunch and the Food Stamp Programs were created NOT to feed the hungry, but to support and subsidize the food industry and its subsets (meat, dairy, etc.). Yet another form of corporate welfare.

The School Lunch Program, in particular, provides an outlet for gov't surplus commodities, many of which, like cheese, are also handed out at food banks. This is why the lowest-grade, e.coli-laden ground beef ends up on your child's lunch tray.
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Old 07-07-2011, 06:28 AM   #24
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Federal State Local Government Revenue in United States 2011 - Charts Tables
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As I recall the bush tax cuts gave up around $150B in revenue.

Adding that amount in I get a deficit reduction of around $590B.

That's closer but still not there.

I beleive that we need still more pain than that. More taxes - more cuts.

.
I'm going with the CBO chart which says over the years we get convergence by rescinding the tax cuts with current policy (health plan reductions). Add in 10% cuts since no one will accept that the heal;th plan will deliver and we are there.

I don't know what the specific income tax revenue numbers are. Wikipedia says a little less than $900B. This page shows 2011 Fed Income Tax at $1.5 trillion. And the 2010 deficit is not the one we have to work against long term since it included huge incentive spending that is not scheduled in the baseline spending for the future.
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Old 07-07-2011, 08:32 AM   #25
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Is that right? I don't have the numbers for taxes and spending, but I meant a true increase of 10% in tax rate at every level. 0% goes to 10%, 15% goes to 25%, 30% goes to 40%. Individual and corporate. That has to be more than 90B.
The 0-10% will never happen. That's part of the problem right now, ~50% pay no income tax at all. Some get money back without paying in.
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Old 07-07-2011, 09:15 AM   #26
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The 0-10% will never happen. That's part of the problem right now, ~50% pay no income tax at all. Some get money back without paying in.
With 50% having no skin in the game (paying 0 tax), how in the world will people ever vote to reduce spending? It makes no sense to cut spending when you don't even have to pay a cent for the programs.
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Old 07-07-2011, 11:21 AM   #27
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Because both the School Lunch and the Food Stamp Programs were created NOT to feed the hungry, but to support and subsidize the food industry and its subsets (meat, dairy, etc.). Yet another form of corporate welfare.

The School Lunch Program, in particular, provides an outlet for gov't surplus commodities, many of which, like cheese, are also handed out at food banks. This is why the lowest-grade, e.coli-laden ground beef ends up on your child's lunch tray.
Facts to support these notions? or just more anti-business rhetoric?
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Old 07-07-2011, 01:27 PM   #28
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The problem with the entire discussion of the deficit/taxes is that our economy is a system that will respond to whatever is done. There are only a few components to GDP. If the govt. portion goes down, then GDP will also decline unless personal spending or business spending rise to offset the reduction in govt. spending. If there is a quick reduction in what the govt spends, there will be a major recession/depression. This will in turn further reduce tax collections and the deficit will get higher. This is basic macroeconomics.
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Old 07-07-2011, 01:34 PM   #29
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The problem with the entire discussion of the deficit/taxes is that our economy is a system that will respond to whatever is done. There are only a few components to GDP. If the govt. portion goes down, then GDP will also decline unless personal spending or business spending rise to offset the reduction in govt. spending. If there is a quick reduction in what the govt spends, there will be a major recession/depression. This will in turn further reduce tax collections and the deficit will get higher. This is basic macroeconomics.
yet going massively into debt strangely doesn't show up in GDP numbers.

Funny how GDP alone doesn't tell the whole story.
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Old 07-07-2011, 02:12 PM   #30
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or inflation style by the Fed printing dollars.
There's your answer. The approach least likely to pin blame on particular politicians or parties will win and printing money seems to be the one. Citizens are way too dumb to realize what happened when a gallon of milk is $5.00.
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Old 07-07-2011, 02:14 PM   #31
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I'd rather have it perpetually on the edge of insolvency. It seems to be the only way to stop ramping up the spending.
+1

That is indeed the way it works.
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Old 07-07-2011, 10:51 PM   #32
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With 50% having no skin in the game (paying 0 tax), how in the world will people ever vote to reduce spending? It makes no sense to cut spending when you don't even have to pay a cent for the programs.
The lower the income, the less likely someone will vote.
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Old 07-07-2011, 11:43 PM   #33
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The lower the income, the less likely someone will vote.
Irresponsibility manifests itself in many different forms.
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Old 07-10-2011, 09:48 PM   #34
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Income taxes are only 42% of Federal revenue.

Everyone who works pays FICA and Medicare taxes, everyone who buys something pays corporate income taxes indirectly, everyone who drives pays Federal gas taxes.

I wish people would stop pretending that income taxes were the whole story.

Everyone has at least some skin in the game.

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With 50% having no skin in the game (paying 0 tax), how in the world will people ever vote to reduce spending? It makes no sense to cut spending when you don't even have to pay a cent for the programs.
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Old 07-12-2011, 06:05 AM   #35
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Because both the School Lunch and the Food Stamp Programs were created NOT to feed the hungry, but to support and subsidize the food industry and its subsets (meat, dairy, etc.). Yet another form of corporate welfare.

The School Lunch Program, in particular, provides an outlet for gov't surplus commodities, many of which, like cheese, are also handed out at food banks. This is why the lowest-grade, e.coli-laden ground beef ends up on your child's lunch tray.
I don't know about subsidizing the food industry (could be or not) but I never have understood why if a family is receiving food stamps should they also be getting free school lunch (and breakfast) and receive food at food banks. This seems like triple dipping to me. Food stamps are supposed to be providing for ALL the family's meals INCLUDING the children's breakfast and lunch.
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Old 07-12-2011, 08:10 AM   #36
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... I never have understood why if a family is receiving food stamps should they also be getting free school lunch (and breakfast) and receive food at food banks. This seems like triple dipping to me. Food stamps are supposed to be providing for ALL the family's meals INCLUDING the children's breakfast and lunch.
This is a common misunderstanding.
The Food stamp program plans is a supplemental program. It is not intended to supply all the funds a person/household needs. However, you raise a good point.
In MN, as I recall, the logic behind the school programs is that kids learn better when they are not starving. This actually also seems to improve focus, concentration and test scores.
However, there is a lot of misuse and waste in the food stamp program... And I am getting way off topic I realize.

Back to the topic
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Old 07-12-2011, 09:18 AM   #37
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However, there is a lot of misuse and waste in the food stamp program...
That's the point. They lost me in the early 90's when I found out one of my peers, a well paid Plant Engineer (Dept Mgr) with 8 kids was getting food stamps. That's pure BS, and I never saw him in the same light after that...
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Old 07-12-2011, 09:45 AM   #38
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And how do you get around this chart with that POV? Fact is, the generations before us got way more than their "payments" would have produced otherwise (not sure if we've crossed that line yet or not). You have not made any contributions toward your own Soc Sec, nor has any generation in the US. I've been standing in line for the last 35+ years, but I don't really think I'm going to get the benefit earlier generations got, how is that possible without gouging the generations that follow?
We do have a SS surplus, enough to keep it (not govt) solvent through 2037 or so. We paid for earlier retiries, but we also accumulated enough to substantially cover ourselves as well.
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Old 07-12-2011, 09:49 AM   #39
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Zathras, Thanks for the explanation. Maybe this should be a different topic. I just see this (abusing the tax dollars collected) as part of the overall problem. FWIW many decades ago I appreciated the help I received from 2 months of food stamps. I found it to be embarassing and I got off them as fast as I could. However, because I was frugal with them, bought fresh produce in season, relied on beans, PBJ, etc. (supplimented with a little chicken) as my main sources of protein, and used rice, pasta, and potatos for carbohydrates I was able to stretch my food stamps for 4 months. They were my only source of money for food so it was no suppliment regardless of what the intention is.

My wife, a recently retired teacher, is able to relate hundreds of "first hand knowledge" stories about the abuse to the system that our tax dollars support. Although this is just one area of abuse, I believe that collectively eliminating the abuses/waste and pork, reducing debt, and spending within our means would go a loooooooooog way to correcting the country's financial problems.

I admit I don't understand the complexities of national economics but I would think the principles would be similar to the kind of budgeting most of us here advocate.
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Old 07-12-2011, 09:49 AM   #40
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We do have a SS surplus, enough to keep it (not govt) solvent through 2037 or so. We paid for earlier retiries, but we also accumulated enough to substantially cover ourselves as well.
Whether we've had a surplus for the last couple decades is a matter of semantics and definitions, I think. Depending on how one defines the terms -- and either way is defensible in some ways -- either we have a surplus, or we spent it all to bring the budget closer to balance year after year.
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