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ironphoenix) wrote2008-09-16 01:05 pm
ironphoenix) wrote2008-09-16 01:05 pm
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metahacker
This graph says it all, really.1 Republicans are for the rich. It's that simple.
Why do so many poor and middle-class people vote for them?
1: Well, not really. It doesn't show the cuts to social programs that the Republican tax plan necessarily implies because of the reduction in net tax revenues, which generally hit low-income folks harder.
Why do so many poor and middle-class people vote for them?
1: Well, not really. It doesn't show the cuts to social programs that the Republican tax plan necessarily implies because of the reduction in net tax revenues, which generally hit low-income folks harder.
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Also because tax cuts for the wealthy generally spur tax revenue, which is the only way government can expand social services effectively. Want better education services? Encourage economic growth. Historically, raising taxes on upper-middle and upper class citizens generally deters economic growth (in America - I can't speak for other countries on that). A better economy means more money changing hands more often, meaning more taxes being levied, meaning more money in the government's coffers, meaning expanded and improved programs. Much as I wouldn't mind getting the extra 20 bucks a paycheck Obama's tax plan would give me, I'd much rather the company I work for have the capital and the market confidence to grow so they can promote me and just give me a raise instead (my last raise tacked on an extra $55 a paycheck, net). Am I happy that that's how things are? Not necessarilly. But you work with what you've got, not what you wish you had.
Chart showing the Bush tax cuts caused one of the highest jumps in Tax revenue in history. (http://taxprof.typepad.com/.shared/image.html?/photos/uncategorized/revenue20growth.jpg) Graph 3 shows a general plateau across history of federal receipts percentage of American GDP - note that most dips occur directly before a large tax cut. (http://www.marktaw.com/culture_and_media/TheNationalDebt.html)
I don't like Bush's federal policies and running us into a deficit, but we're not running in deficit and needing to cut programs because a lack of tax revenue. We're running in deficit because of rampant wasteful and corrupt spending.
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Your cited graphs: I don't actually know the Act mentioned in the first graph, but I will note that the graph isn't inflation-adjusted. Also, the jump isn't what's characterized as being the largest in history, but rather, the level in unadjusted dollars. Finally, correlation is not causation; there are a lot of factors which influence this beyond Bush's legislation. I don't see what you're talking about in the second graph when you say to "note that most dips occur directly before a large tax cut."
Main paragraph: Economic growth is encouraged by encouraging investment, not by encouraging hoarding. That's why capital gains rebates are implemented. Also, corporate tax rates aren't part of the discussion here. Personally, if there is a way to control the offshoring of profits, I would like to see corporate taxes at 0 and transfer that burden to individual taxes, so that the money is taxed when it comes out of the company into owners' hands, but not before; this would maximize the value of reinvestment.
As for promotional raises... well, my company and I don't see eye-to-eye on this one. Let's leave it at that, shall we?
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The graphs were more to demonstrate that tax cuts have, if nothing else, not had any negative impact on the economy (the single largest factor that drives tax revenues) - and that it's likely they tend to have a positive impact, though you are correct; correlation is not causation.
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You say that like you expect the profits at the top to trickle down to the employees, rather than simply enriching the shareholders and providing bonuses to the management.
That doesn't happen, in practice. It never has.
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I'm referring to economic growth. When the economy grows, there is more money to be made. What does a company do? It makes money. If there is more money to be made, the company is going to try to get that money. The greater the economic growth, the more opportunity to try to saturate the main markets, as well as tap into niche markets that would have been previously unprofitable. In order for a company to take advantage of the money to be made, it has to have adequate staffing in place. If its staff is not capable of fully taking advantage of the marketshare the company feels it is should be capable of, then the staff grows out of sheer necessity. The expansion of a company is inevitable during economic growth. Expansion meaning more employees, more supervisors, more departments, more products.
It is more cost-effective, practical, and overall good for worker morale (directly tied to productivity) to hire for new and/or higher-positions in-house. Thus my point about promotions/raises. I don't expect my company to give me more money or promote me for just doing my job. I expect them to look at what I have achieved on behalf of their bottom line and say, "Well, hell, this guy makes us money and looks good doing it. Let's put him in a position where he can do that for us even more and give him incentive to do so." Being the capitalistic asshole I am, I absolutely expect them to provide said incentive to make them money. If they don't, I'll find somewhere else to work.
Of course, companies are going to try to short-cut their workers for their bottom-line. Tough shit. It's as much the responsibility of the worker to *not* let them do that as it is the company to not do it in the first place.
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Most companies hire their senior managers from outside these days. Despite the factors you mention, few people who are stellar line-level employees make stellar executives. Of course, few people make stellar executives, period, regardless of what school's MBA they have. Heck, few people make stellar line-level employees, too. What I'm saying is that it's not the same people. Also, training people up is a cost and a risk (they might leave after getting the training, and they'll probably expect more money: "I absolutely expect them to provide said incentive to make them money. If they don't, I'll find somewhere else to work."), and most companies want to externalize their costs, so they prefer to hire people who already have the skills and track record.
Your last paragraph is exactly what unions are (supposed to be1) all about.
1: As it is, I think they do way too much big-P politics, but then, so do corporations.
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Well, kind of, at least... maybe I'm not being entirely even-handed, there. The fair comparison might not be the delta from the status quo, but rather the net tax rate proposed by the two candidates. (Sadly, I don't have such a graph.) In that analysis, I think we'd find that neither party is adhering to a philosophical ideal, but that both are picking compromise positions that are, in the overall scheme, not as far apart as the graph I linked to would suggest. Despite all that, I still see the change being proposed by the Republicans as taking from the poor and giving to the rich, and I have a hard time not seeing that as being "government interference" of the worst kind.
So, to put you on the spot, how would you structure taxes, starting from a clean sheet of paper?
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See much as I understand why we have a progressive system here, I would have no problem with a flat tax rate. But I would want it coupled with
a) an exemption for the first X dollars which would denote a at least a minimumally livable level (e..g the poverty line) which would not be taxed.
b) no other exemptions or loopholes or clever put-asides or tax shelters
c) a much lower rate since closing all the loopholes should mean that a flat tax wouldn't need to be more than 20%, possibly even lower.
Given that clever people will always find loopholes (oh hai, my money is now in offshore accounts, profits, no that's a loss oh noes my poor company oh woes) I don't think this system would work. But wouldn't it be nice in an idealized world?
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Minimum livable depends on where you live. Compare housing prices in Ottawa, ON and say, Riverside-Albert, NB.
Overall, instead of a flat tax, I prefer a smooth subsidy-tax curve which crosses a zero-tax, zero-subsidy point somewhere significantly above the bare minimum survival level, in order to provide a positive incentive to low-income people while ensuring that zero-income people can survive.
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Would that this government lack of interference worked all the way around (that is - personal responsibility for the rich and corporate fiduciary responsibility for corporations) in this model.
Also would that this "little government interference" applied to social matters such as not feeling compelled to legislate hetoresexuality.
I will believe the Republicans "we want small government and minimal interference" lines when they put their money where their mouth is. All I see is pandering to rich interests as well as a large desire to legislate morality according to a specific standard.
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It's that simple