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Veteran Advisor

Straight up progressive proposal to chew on

19 Replies
Advisor

Re: Straight up progressive proposal to chew on

After WW2 US lifestyles and income grew because we were producing for the world that had been destroyed.    Produce first, income then grows.  Produce first, then people make more money.    The problem is not lack of money it is lack of production.   Redistributing other peoples money only fixes the problem till the money runs out or the money goes elsewhere.    The first step is not getting people more money, it's figuring out how to get the production back.  That will be a painfully slow drawn out process.

Senior Contributor

If you really...really want the economy going

Eliminate the capital gains tax!!!!!! Watch this video and increase your knowledge of the economy tenfold in just 6 minutes!!!  Smiley Happy

http://www.youtube.com/watch?v=_yXINN1tD54

Senior Advisor

Re: If you really...really want the economy going

It seems like the rich or investor class can sure sell the idea that taxing them is a bad idea.

 

Don't like to pay corporate taxes? Don't buy stocks in corporation. Do like we farmers do. Buy a farm. Farm it and or rent it out and pay income taxes like other individuals do. Do they ever stop to think of all the public investment we make to service businesses.

 

Create jobs? How many **bleep** jobs does it create when one investor sells to another. That doesn't change the capitalization of a company. That doesn't encourage them to invest in the business or hire another guy. Such shameless bull crap.

 

I suppose we ought to cut taxes on labor. Perhaps they would invest money if they just had it to invest. Instead these avowed capitalists are anti labor union and labor and they resist any attempt to increase labors pay but expect individuals to carry the burden of taxation.The truth is the business world is for the most part anti labor.

 

Most capital gains are wealth earned by investing money. Wages is wealth earned investing ones time and  the sweat of ones body. Who struggles more to earn a buck and why should he be penalized for the way he earns? Many paying 15% income tax and more plus 15% Fica taxes. That 30% taxation against their piddling 15% capital gains rate.

 

Frankly, I don't beleive the low capital gains rate encourages investment. Most people invest because of the potential earnings there is in the investment. However, Lower rate may encourage people to sell their investment because the taxation is less onerous. But I see little value in investor B buying the same shares that investor A wants to sell. That produces nothing only profits or losses for those involved.

 

NOw to those that favor the tax on consumption. That is because you don't consume all you earn. Many employees do spend the bulk of their earnings on consumable products. So you are saying those with less means should pay a higher percentage of their income of their income for taxes than you the investor class. BY what logic do you come to that conclusion.

 

So lets put on a national sales tax. But we don't just tax conxumers, lets tax every transaction. You buy a car, you buy a loaf of bread or you buy a stock or a bond or a farm or a CD you pay a sales tax on all of it. Every transaction gets taxed. I sdon't have aclue as to the rates it would require but tax the whole schmere. Lets see if the think a sales tax is a good idea. It costs you nothing to buy a stock or a bond but it costs you a sales tax when you sell it. Just like farmers paying a sales tax for selling beans.

 

The first thing that investors ought to consider is their income is no more precious to them than an earned dollar is to an employee. They shouldn't have a special place in society. An investor is no more special that a worker that invests his time. If an investor thinks not, he casn put his money in the bank and grab a shovel and go to work. I don't see many former bankers or stockbrokers digging tile ditches.

 

Now I have to replay the video to see what parts I didn't address. BTW.. I do think those that invest in a startup company may qualify for some special tax consideration. But that don't mean everyone that sells a stock ought to get taxed at low rate.

 

America needs investors but we need workers as well. Shouldn't we as american tax payers value the investment in time an energy as much as we value a guy cashing a in a capital investment. BTW America and business needs consumers as well.

Senior Contributor

Re: If you really...really want the economy going

If we got rid of capital gains tax if only for a short period, imagine all the assets that would be sold. Right now land and so forth is just being sat on to avoid the taxman and for no other purpose. After the sales, think of the windfall stimulus to the economy. A good lot of that money would go to building dream homes, luxury cars, boats, airplanes, vacations. It would put land on the market that otherwise wouldn`t go up for sale for another 30 years, giving new blood a opportunity. It would put boat and airplane manufacturers back to work. Nothing against poor people, but  they can`t hire you for a job. 

Veteran Advisor

Re:Changes needed Kraft-t

There are others who agree with you Don that changes are needed.

Warren Buffet thinks it is wrong for him to pay a lower rate than his receptionist  http://www.washingtonpost.com/wp-dyn/content/article/2007/06/27/AR2007062700097.html

And there is the bet http://freakonomics.blogs.nytimes.com/2008/05/01/taxes-warren-buffett-and-paying-my-fair-share/ of $1M. Anyone of the Forbes 400 that can show they pay a higher rate than their receptionists can collect.

No takers so far.

It would seem to me that proposals to eliminate some taxes like capital gains would only make that gap between millionares and their receptionists greater.

Veteran Advisor

Re: Land does not have to cahnge hands BA

No capital gains tax would not necessarily cause assets to change hands.

Some might but many would just do some kind of flip to 'crystalize' the gain and still own the asset at a higher value to reduce any taxes applied against it in the future.

Threatening to increase the tax in the future would probably cause more actual sales and it would bring in some tax revenue from anyone trying to 'crystalize' the gain at the old lower rate.

And I was under the impression your country needs more tax income to pay for past wars.

Senior Contributor

Re: Land does not have to cahnge hands BA

Hey Canuck, by shedding cap gain tax we would be "fooling" otherwise stale money out to stimulate the economy. I have a modest farm inside the city limits and have had buyers enquire about it. It`s a pain to drive machinery through town and it`s out of the way. I`d do a "1031 exchange" but land in my area comes up for sale as often as hen`s teeth. I`m just too tight to send Uncle Sam $2000 @ acre after selling it. With no capital tax, within 2 mo there`d be a new Morton shop, 2011 Silverado in the the garage and Christmas vacation would be spent in Hawaii. There are thousands of us in the same boat, especially those who hold stock for fear of getting dinged on taxes. It just makes more sense to let people grow their own economy rather than spend a $1 trillion gov`t money, Krugman says it was only half enough. The war cost $700 billion, a mere pittance to what Obama is throwing around. The war should`ve be payed with a gas tax anyway. Have a Great Day Buddy!  

Senior Advisor

Re: Land does not have to cahnge hands BA

You would be paying taxes on gains of $13333 per acre and you don't want to share 15% with the government. Plus you don't have to pay fica taxes on it. You simply do not want to pay taxes do you?

 

So who is going to pay the taxes? People without income?

 

Uncle Sam will already pay for a large share of the shop and the silverado. Some folks are never satisfied.

Senior Contributor

Re: Land does not have to cahnge hands BA

Cut spending and the government does not need to raise any taxes. It is really very simple.