||Home||Switchboard||Unix Administration||Red Hat||TCP/IP Networks||Neoliberalism||Toxic Managers|
|(slightly skeptical) Educational society promoting "Back to basics" movement against IT overcomplexity and bastardization of classic Unix|
|News||US Presidential Elections of 2020||Recommended Links||Trump 2020 compaign||Tax policy and tax avoidance under neoliberal regime||Populism as a social protest against neoliberalism||Corruption of Regulators||Lobbying as institutionalized corruption||Cognitive Regulatory Capture|
|Neoliberal corruption||"Clinton Cash" Scandal: Hillary Clinton links to foreign donors and financial industry||Revolving Doors as Corruption||Silencing of Brooksley Born||Demexit: Abandonment of Democratic party by working class and lower middle class||Elite [Dominance] Theory And the Revolt of the Elite||Clinton monday morning quarterbacking||Redistribution of wealth up as the essence of neoliberalism||Chronic Unemployment|
|Media-Military-Industrial Complex||Neoconservatism||The Deep State||American Exceptionalism||New American Militarism||Neocolonialism as Financial Imperialism||Pope Francis on danger of neoliberalism||Neoliberalism as Trotskyism for the rich||Neoliberal Brainwashing -- Journalism in the Service of the Powe|
|Corporatist Corruption||Amorality and criminality of neoliberal elite||Audacious Oligarchy and "Democracy for Winners"||Myth about intelligent voter||Pluralism as a myth||Libertarian Philosophy||Nation under attack meme||Trump economic platform2016||Trump on immigration|
|Principal-agent problem||Resurgence of neo-fascism as reaction on neoliberalism||Corporatism||Ethno-linguistic Nationalism||Non-Interventionism||National Security State||Predator state||Machiavellism||Neoliberal Propaganda: Journalism in the Service of the Powerful Few|
|Betrayal by Bernie Sanders of his supporters||Superdelegates at Democratic National Convention||The Iron Law of Oligarchy||Trump 2020 compaign||US Presidential Elections of 2016 as a referendum on neoliberal globalization||Politically Incorrect Humor||Skeptic Quotations||Humor||Etc|
Donald Trump’s tax plan significantly reduced income taxes, corporate taxes, and eliminated the estate tax. For the wealthy, banks and other corporations, the tax reform package can be considered a lopsided victory given its significant and permanent tax cuts to corporate profits, investment income, estate tax and more. The overhaul is forecast to raise the federal deficit by hundreds of billions of dollars – and perhaps as much as $2.0 trillion – over the coming decade.
The World Bank believes that the tipping point for debt to GDP is 77%. Right now, the debt to GDP ratio for the US is 104% before the tax cuts. And every percentage point above 77% costs a country 1.7% in growth. So, do the math and you’ll see how much the US is losing out on in growth terms.
The Trump Tax Bill is using the theory of supply-side economics. That’s a false belief that tax cuts spur economic growth.
The law cuts corporate tax rates permanently and individual tax rates temporarily. It permanently removes the individual mandate, a key provision of the Affordable Care Act, which is likely to raise insurance premiums and significantly reduce the number of people with coverage
The Senate passed the bill on December 20, 2017 by a party-line vote of 51 to 48; The House passed the bill later in the day by a vote of 224 to 201. No House Democrats supported the bill and 12 Republicans voted no, most of them representing California, New York and New Jersey
Financial services companies, especially, stand to see huge gains based on the new, lower corporate rate (21%) as well as more preferable tax treatment of pass-through companies. Some banks have said that their effective tax rate will drop under 21%.
The plan would reduce revenues by between $2 trillion and $4 trillion
The law retains the current structure of seven individual income tax brackets, but in most cases it lowers the rates: the top rate falls from 39.6% to 37%, while the 33% bracket falls to 32%, the 28% bracket to 24%, the 25% bracket to 22%, and the 15% bracket to 12%. The lowest bracket remains at 10%, and the 35% bracket is also unchanged. The income bands that the new rates apply to are lower, compared to 2018 brackets under current law, for the five highest brackets. The changes will be temporary, going into effect in 2018 and expiring after 2025, as is the case with most personal tax breaks included in the law. Trump's Tax Reform Plan Explained
|Taxable income over||Up to||Marginal rate|
|Taxable income over||Up to||Marginal rate|
The law raises the standard deduction to $24,000 for married couples filing jointly in 2018 (from $12,700), to $12,000 for single filers (from $6,300), and to $18,000 for heads of household (from $9,550). These changes expire after 2025.
The additional standard deduction, which the House bill would have repealed, will not be affected. In 2019, the inflation gauge used to index the standard deduction changed in a way that is likely to accelerate bracket creep (see below).
U.S. companies' effective tax rate – defined as the tax paid on investments earning the market rate of return after taxes – was 18.6% in 2012, according to the Congressional Budget Office (CBO); that was the fourth-highest rate in the G20.
The law enacts a deemed repatriation of overseas profits at a rate of 15.5% for cash and equivalents and 8% for reinvested earnings. Goldman Sachs estimates that U.S. companies hold $3.1 trillion of overseas profits. As of Sept. 30, 2017 Apple Inc. (AAPL) alone held $252.3 billion in tax-deferred foreign earnings, 94% of its total cash and marketable securities.
The law doubles the estate tax exemption. Speaking in Indiana in September, Trump attacked "the crushing, the horrible, the unfair estate tax," describing scenarios in which families are forced to sell farms and small businesses to cover estate tax liabilities: the 40% tax only applies to estates worth at least $5.49 million under current law. According to TPC, 5,460 estates are taxable under current law in 2017. Of those, just 80 are small businesses or farms, accounting for less than 0.2% of the total estate tax take.
The estate tax mostly targets the wealthy. The top 10% of the income distribution accounts for an estimated 67.2% of taxable estates in 2017 and 87.8% of the tax paid.
The law does not eliminate the carried interest loophole, though Trump promised as far back as 2015 to close it, calling the hedge fund managers who benefit from it "pencil pushers" who "are getting away with murder." Hedge fund managers typically charge a 20% fee on profits above a certain hurdle rate, most commonly 8%. Those fees are treated as capital gains rather than regular income, meaning that – as long as the securities sold have been held for a certain minimum period – they are taxed at a top rate of 20% rather than at 39.6%. (An additional 3.8% tax on investment income, which is associated with Obamacare, also applies to high earners.)
May 26, 2020 | www.theamericanconservative.com
They also left worker wages stagnant and increased the deficit. Where is our more nationalist economic policy?
Much has been written about the disappointment of certain segments of the right in the apparent capitulation of Donald Trump to the agenda of the conservative establishment.
Instead of reining in the "globalist elites" he so vociferously ran against or those corporations "who have no loyalty to America," his one legislative achievement has been to award them a massive tax cut. Through it, he has maintained their favorite mix of low revenue intake and high deficits which gives Republicans a pretext to "starve the beast" and induce fiscal anorexia.
The president has granted them as well their ideal labor market through an ingenious formula: double down on mostly symbolic raids (as opposed to systemic solutions like Mandatory E-Verify) and ramp up the rhetoric about "shithole countries" to distract the media, but keep the supply of cheap, exploitable low-skill labor (legal and illegal) intact for the business lobby.
Trump ran as a populist firebrand -- a fusion of Huey Long and Ross Perot -- and while he never abandoned that style, he has governed for the most part as a milquetoast free market Republican in perfect tandem with Paul Ryan and Mitch McConnell, one whose solution to everything is more tax cuts and deregulation: a kind of turbo-charged "high-energy Jeb."
With the outbreak of COVID-19, many on the reformist right are hoping for the emergence of the President Trump they thought they were promised, a leader just as ready to break out of the donor-enforced "small government" straitjacket while in power as he was during the campaign.
Despite signs of progress, what's more likely is a return to business as usual. Already the GOP's impulse for austerity and parsimony is proving to be stronger than any willingness to think and act outside the box.
The heightened rhetoric against China will continue -- the one thing Trump is good at -- but it is unlikely to be matched with the required policy, such as a long-term plan to reshore U.S. industry (that doesn't just rely on blindly giving corporations the benefit of the doubt). At this point, we already know where the president's priorities lie when given a choice between the advancement of America's workers or continued labor arbitrage and carte blanche corporate handouts.
Lest they be engulfed by it like everyone else, the reformist right should ask: is there any way to stand athwart the supply-side swamp yelling Stop?
Many of these conservatives lament the Trump tax cut not just because it was a disaster that failed to spark reinvestment, left wages stagnant, needlessly blew up the deficit and served as a slush fund for stock buybacks, but more fundamentally because it betrayed the overwhelming intellectual inertia and lack of imagination that characterizes conservative policymaking.
More than in any other issue then, a distinct position on taxes would make the new conservatism truly worth distinguishing from the old: tax cuts were after all the defining policy dogma of the neoliberal Reagan era.
If neoliberalism excused inequality at home by extolling the equalization of incomes across the globe (millions of Chinese raised from poverty, while millions of American workers fall back into it!), the new position must shift emphasis back to ensuring a more equitable domestic distribution of wealth and opportunity across all classes and communities in this country.
A reformulation of fiscal policy along populist economic nationalist lines can help with that.
It is worth pondering what might have happened if the administration had gone the other way and followed the last piece of policy advice given by Steve Bannon before his ouster in August 2017. Bannon suggested raising the top marginal income tax rate to 44 percent while "arguing that it would actually hit left-wing millionaires in Silicon Valley, on Wall Street, and in Hollywood."
Such a move would have been nothing short of revolutionary: it would have been a faithful and full-blown expression of the populist economic nationalism Trump ran on; it would have presented a genuine material threat to the elite ruling class of both parties, and likely would have pre-empted the shock value of Alexandria Ocasio-Cortez proposing a 70 percent top marginal rate.
It might well have put Trump on the path to becoming what Daniel Patrick Moynihan once proposed as a model for Richard Nixon when he gifted the 37th president a biography of Disraeli, namely a Tory Republican who could outsmart the left by crafting broad popular coalitions based on a blending of patriotic cultural conservatism with class-conscious economic and social policy.
Not that Trump would have needed to go back to Nixon or Disraeli for instruction on the matter. In 1999, long before Elizabeth Warren came along on the national scene, a presidential candidate eyeing the Reform Party nomination contemplated the imposition of a 14.25 percent wealth tax on America's richest citizens in order to pay off the national debt: his name was Donald Trump.
What ever happened to that guy? The Trump of 1999 was onto something. Maybe this could be a way to deal with our post-pandemic deficits.
Then and even more so now, the idea resonates: a Reuters/Ipsos poll from January found that 64 percent of Americans support a wealth tax, a majority of Republicans included. Poll after poll has reaffirmed this. It seems as if there is right-wing populist support for taxing the rich more.
To the common refrain, "the rich are just going to find ways to shelter their income or relocate it offshore," I have written elsewhere about the concrete policy measures countries can and have taken to clip the wings of mobile global capital and prevent such an outcome.
I have written as well about how taxing the rich and tightening the screws on tax enforcement have implications that go beyond the merely redistributive approach to fiscal policy conventionally favored by the left; about how it can be a form of leverage against an unaccountable investor class used to shopping at home and abroad for the most opaque assets in which to hoard vast amounts of essentially idle capital.
A deft administration would use aggressive fiscal policy as an inducement for this irresponsible class to make things right by reinvesting in such priorities as the wages and well-being of workers, the vitality of communities, the strength of strategic industries and the productivity of the real economy – or else Uncle Sam will tax their wealth and do it for them.
It would also be an assertion of national sovereignty against globalization's command for countries to stay "competitive" by immiserating their citizens with ever-lower taxes on capital holders and ever more loose and "flexible" labor markets in a never-ending race to the bottom.
Mike Lofgren has penned a marvelous essay in these pages about the virtual secession of the rich from the American nation, "with their prehensile greed, their asocial cultural values, and their absence of civic responsibility."
What better way to remind them that they are still citizens of a country and members of a society -- and not just floating streams of deracinated capital -- than by making them perform that most basic of civic duties, paying one's fair share and contributing to the commonweal? America need not revert to the 70-90 percent top marginal rates of the bolshevik administrations of Truman, Eisenhower or Kennedy, but proposals for modest moves in that direction would be welcome.
There is one more thing to be said about the significance of taxing the rich. Up until very recently, there has been a prevailing tendency among the reformist right (with some important exceptions) to couch criticism of the elites primarily or even exclusively in cultural terms. There seems to have been a polite hesitation at taking the cultural critique to its logical economic conclusions. It is easy to excoriate the excesses of elite identity politics, the "woke" part of woke capitalism; it's something all conservatives -- and indeed growing numbers of liberals and socialists -- agree on. Fish in a barrel.
But to challenge the capitalism part, i.e. free market orthodoxy, not in a secondary or tertiary way, but head on and in specific policy terms as Lofgren and a few others have done, would involve confronting difficult truths, namely that the biggest beneficiaries of tax cuts and Reaganite economic policy in general, which most conservatives enthusiastically promoted for four decades, are the selfsame decadent coastal elites they claim to oppose. It is they who more than anyone else thrive on financialized globalization, arbitrage and offshoring.
In other words, it amounts to an honest recognition of the complicity of conservatism in the mess we're in, which is perhaps a psychological bridge too far for too many on the right, reformist or not. (Trigger Warning!) This separation of culture and economics has led to the farce of a self-styled nationalist president lining the pockets of his nominal enemies, the globalist ruling class.
Already, the White House is proposing yet another gigantic corporate tax cut. Using the exact same discredited logic as the last one, senior economic advisor Larry Kudlow wants Americans to trust him when he says that halving the already lowered 2017 rate to 10.5 percent will encourage these eminently reasonable multinationals to reinvest. There he goes again.
A conservative call to tax the rich would signal that the right is ready to end this charade and chart a course toward a more patriotic, public-spirited and yes, proudly hyphenated capitalism.
Michael Cuenco is a writer on politics and policy. He has also written for American Affairs.
Kent • 3 days ago"America need not revert to the 70-90 percent top marginal rates of the bolshevik administrations of Truman, Eisenhower or Kennedy, but proposals for modest moves in that direction would be welcome."Winston Nevis Kent • 3 days ago • edited
Those tax rates were offset by direct investment in the US economy. So if I invested in the stock market, I'd get a 90% tax rate because that doesn't produce actual wealth. On the other hand, if I invested in building factories that created thousands of jobs for American citizens, my tax rate may fall to 0%. And those policies created a fantastic economy that we oldsters remember as the golden age. That wasn't bolshevism, it was competitive capitalism. What we have today is libertarianism. And as long as conservatives are going to let the libertarian boogey-man's nose under the tent, we are going to have this ugly, bifurcated economy. Your choice. Man up.You ever tell hear of sarcasm, bud? I think that's what the author was going for. Don't think he was trying to say that Ike and Truman were Bolsheviks but was rather making fun of libertarians who hyperbolically associate high tax rates with socialism and Soviet Communism...K squared Winston Nevis • 3 days agoPlenty of goldwater's supporters in 1964 called President Eisenhower a communistGAguilar K squared • 2 days agoParticularly the John Birchers, including my parents!SKPeterson Kent • 3 days ago • editedWe absolutely do not have libertarianism operating in this country today. There is simply no evidence that there is any sort of libertarian economic or political system in place. Oh sure, you'll whine "but globalism without actually defining what globalism is, or what is wrong about precisely, but just that it's somehow wrong and that libertarians are to blame for it. There's a good word for such an argument: bullshit.marku52 SKPeterson • 3 days ago
We have an economy that is extraordinarily dominated by the state via mandates, regulations, and monetary interference that is most decidedly not libertarian in any way whatsoever. The current system though does create and perpetuate a system of rent-seeking cronies who conform rather nicely to the descriptions of said actors by Buchanan and Tullock. The problems of the modern economy are the result of state interference, not its absence, and Cuenco's sorry policy prescriptions do nothing to minimize the state but instead just create a different set of rent-seeking cronies for which the wealth and incomes of the nation are to be expropriated.O dear, No True Scotsman....SKPeterson marku52 • 2 days agoIf you can point to how the current situation is in any way "libertarian" without creating your own perfect little lazy straw man definition then by all means do so. Until then your retort is withoutcka2nd SKPeterson • 3 days ago
substance (you see a no true Scotsman reply doesn't work if the facts are in the favor of the person supposedly making such an argument. Here you fail to establish why what I said is such a case; saying it doesn't make it so). When Kent makes some throwaway comment that we're somehow living in some sort of libertarian era he's full of it, you know it, and all you can do is provide some weak "no true Scotsman" defense? Come on and man up, stop appealing to artificial complaints of fallacious argumentation, and give me an actual solid argument with evidence beyond "this is so libertarian" that we're living in some libertarian golden age that's driving the oppression of the masses.Busted unions, contracting out and privatization, deregulation of vast swaths of the economy since the late 1970's (Jimmy Carter has gotten kudos from libertarian writers for his de-regulatory efforts), lowered tax rates, especially on financial speculation and concentrated wealth, a blind eye or shrugged shoulder to anti-trust law and corporate consolidation. Yeah, nothing to see here, no partial victories for the libertarian wings of the ruling class or the GOP, at all. The Koch Brothers accomplished nothing, absolutely nothing, since David was the Libertarian Party's nominee for Vice President in 1980; all that money gone to waste. Sure.SKPeterson cka2nd • 2 days agoSo, now some sort of "partial victory" means we're living in some sort of libertarian era? And what exactly was so wonderful about all the things you listed being perpetuated? So, union "busting" is terrible, but union corruption was a great part of our national solidarity and should have been protected? Deregulation of vast swathes of the economy? You mean the elimination of government controlled cartels in the form of trucking and airlines? You mean the sorts of things that have enabled the working class folks you supposedly favor to travel to places that were previously out of reach for them and only accessible to the rich for their vacations? Yes, that's truly terrible. Again, you're on the side of the little guy, right? Lowered taxes? Are you seriously going to argue that the traditional conservative position has been for high tax rates? What are taxes placed upon? People and property. What do conservatives want to protect? People and property. So... arguing for higher taxes or saying that low taxes are bad or even especially, libertarian, is really going off the rails. That's just bad reasoning. And regarding financialization, those weren't especially libertarian in their enacting, but rather flow directly out of the consequences of the modern Progressive implementation of neo-Keynesian monetary and fiscal policy. Suffice it to say, I don't think you'll find too many arguments from libertarians that the policies encouraging financialization were good or followed libertarian economic policy prescriptions. Moreover, they led entirely to the repulsive "too big to fail" situation and if there's one thing that libertarians hold to is that there is no such thing (or shouldn't be) as "too big to fail." The objection to anti-trust law is that it was regularly abused and actually created government-protected firms that harmed consumers. If you think anti-trust laws are good things and should be supported by conservatives then by all means encourage Joe Biden to have Elizabeth Warren as his vice-presidential running mate and go vote Democrat this fall.Blood Alcohol SKPeterson • 3 days ago"The problems of the modern economy are the result of state interference, not its absence". That's because the "state interference" is working as proxy for the interests of vulture capitalist.DUNK Blood Alcohol • 2 days ago • edited
What we have today is vulture capitalism as opposed to free enterprise capitalism.You could also call it "crony capitalism" or "inverted totalitarianism".GAguilar DUNK • 2 days ago
Chris Hedges: "Sheldon Wolin and Inverted Totalitarianism" (November 2, 2015)Princeton professor Sheldon Wolin's excellent book is entitled, "Democracy Incorporated."SKPeterson Blood Alcohol • 2 days ago
He lays out how we're living in a totalitarian, capitalist surveillance state, as if that's not already obvious to most people around here.Exactly. The existence of a vulture capitalist or crony capitalist economy, which we have in many sectors, is evidence that "libertarianism" is nothing more than a convenient totem to invoke as a rationale for complaint against the outcomes of the existing crony capitalist state of affairs. My contention is that Cuenco, et al are simply advocating for a replacement of the cronies and vultures.1701 • 3 days agoA very similar article(but probably coming at it from a slightly different angle) wouldn't look out of place in a socialist publication.bumbershoot • 3 days ago
The culture war really is a pointless waste of time that keeps working class people from working towards a common solution to shared problems.Trump wants to "keep the supply of cheap, exploitable low-skill labor (legal and illegal) intact for the business lobby."SKPeterson • 3 days ago
Well of course he does -- otherwise how would he staff Mar-A-Lago and other Trump Organization businesses?I used to think that conservatism was about protecting private property and not, like Cuenco, in coming up with ever more excuses for expropriating it.Kent SKPeterson • 3 days agoNo, that's libertarianism (or more properly propertarianism). Conservatism is first and foremost about responsibility to God, community, family and self. Property is only of value in its utility towards a means.GAguilar Kent • 2 days ago • editedAs I see it, here are examples of how "conservatives" have actually practiced their "responsibility to God, community, family and self":AdmBenson SKPeterson • 2 days ago
The genocide of Native Americans
The slavery and murder of blacks
Their opposition to child labor laws, to womens' suffrage, etc.
Their support of Jim Crow laws
Their opposition to ending slavery and opposition to desegregation
Opposition to Civil Liberties Laws
Willingness to block, or curtail, voting rights.
Hyping the "imminent threat" of an ever more powerful communist menace bearing
down on us from the late 40s to the "unanticipated" collapse of the
USSR in '91. All of which was little more than endless "threat inflation" used
by our defense industry-corporate kleptocrats to justify monstrous increases
in deficits that have been "invested" in our meddlesome, murderous militarism all around the world, with the torture and deaths of millions from S. E. Asia, to Indonesia, to Latin America, to the Middle East, to Africa, etc.
Violations of privacy rights (conservative hero J. Edgar Hoover's illegal domestic surveillance and acts of domestic terrorism, "justified" by
his loopy paranoia about commies on every corner and under every bed.)
Toppling of democracies to install totalitarian despots in Iran
("Ike" '53), Guatemala (Ike, again, '54), Chile (Nixon '73), Brazil (LBJ, '64) and many, many more countries.
Strong support of the Vietnam War, the wars in Laos and Cambodia, and the Iraq War, which, according to conservative W. Bush, God had inspired.
The myriad "dirty wars" we've fought around the world, and not only in Latin America.
With a few, notable exceptions, conservatives have routinely been on the wrong side of these issues. For the most part, it has been the left, particularly the "hard left," that has gotten it right."conservatism was about protecting private property"SKPeterson AdmBenson • 2 days ago
You're conflating conservatism and libertarianism. Conservatives realize they are citizens of a country. Libertarians wish they weren't.So conservatism should be entirely about taking people's property "for the good of the country"? That the purpose of a country is to loot the people? That the people exist for the government and not the government for the people? Seems Edmund Burke and Russell Kirk would like to have a word with you Adm.Winston Nevis SKPeterson • 2 days ago • edited
To quote Kirk as just one example of your fundamental error:Seventh, conservatives are persuaded that freedom and property are closely linked . [Apparently, Adm. you dispute Kirk's assertion and accuse him thereby of conflating libertarianism and conservatism. Yes, I know Kirk was a hater of the idea of patriotism, but he was such a raging libertarian what else could he do?] Separate property from private possession, and Leviathan becomes master of all. Upon the foundation of private property, great civilizations are built. The more widespread is the possession of private property, the more stable and productive is a commonwealth. Economic levelling [this is the outcome of Cuenco's policy prescriptions by the way] , conservatives maintain, is not economic progress. Getting and spending are not the chief aims of human existence; but a sound economic basis for the person, the family, and the commonwealth is much to be desired.
So, either "Mr. Conservative" Russell Kirk wasn't really a conservative but a man who horribly conflated libertarianism and conservatism, or we can say that Kirk was a conservative and that he recognized the protection of private property as crucial in minimizing the control and reach of the Leviathan state. If the latter holds, then maybe what we've established is that AdmBenson isn't particularly conservative."The more widespread is the possession of private property, the more stable and productive is a commonwealth." This status quo has produced precisely the opposite of this. Wealth, assets, capital has been captured by the elite. The pitchforks are coming. See this CBO chart: View HideAdmBenson SKPeterson • 2 days agoConservatives accept taxes as a part of citizenship. Since taxes can't be avoided, a conservative insists on democratic representation and has a general desire to get maximum bang for their taxpayer buck.SKPeterson AdmBenson • 2 days ago
Libertarians, on the other hand, see everything through the lens of an individual's property rights. Taxes and regulation are infringements on those rights, so a libertarian is always at war with their own government. They're not interested in bang for their taxpayer buck, they just want the government to go away. I can't fault people for believing this way, but I can point out that it is severely faulty as the operating philosophy beyond anything but a small community.
As for me not being particularly conservative, ya got me. It really depends on time of day and the level of sunspot activity.Sunspots, eh? And here I thought it was your reliance on tinfoil.AdmBenson SKPeterson • 2 days agoThe tinfoil and the mask were scaring people. The tinfoil had to go, but that's had side effects.SKPeterson AdmBenson • 2 days agoI should have put the /s on my reply, but your response did give me a good chuckle. Besides, for that finger pointing at you, there were three more pointing back at me.JMWB • 3 days agoAnd somehow people continually fall for the Trickle Down economic theory. George HW Bush was correct when he called this VooDoo economics. Fiscal irresponsibility at it's finest.Victor_the_thinker JMWB • 3 days agoNah people don't fall for it, republicans do. The rest of us know this stuff doesn't work. We didn't need an additional datapoint to realize that. The Tax Cuts and Jobs act was the single most unpopular piece of legislation to ever pass since polling began. It never had support outside of the Republican Party which is why it's never had majority support.Blood Alcohol JMWB • 3 days ago
https://news.gallup.com/pol...John Kenneth Galbraith called Trickle Down "economics", "Oats and Horse Economics". If you feed the horse a lot of oats, eventually some be left on the road...Nelson • 3 days agoThe leader of Republicans isn't Trump. It's Mitch McConnell.J Villain Nelson • 3 days agoMitch is fully owned by Trump as is every republican that holds office except Romney. Mitch can't go to the bathroom with out asking Trumps permission.Nelson J Villain • 3 days agoMitch is owned by corporations and he likes it that way. He basically says as much whenever campaign finance reform pops up and he defends the status quo.aha! Nelson • 2 hours agoYep. The guy who declared war on the Tea Party. The guy who changed his tune entirely about China when he married into the family of a shipping magnate.SeekingTruth • 3 days agoI'm eagerly awaiting a GOP plan for economic restructuring. I've been waiting for decade(s). Surely there is someone in the entire body of think tanks, congressional staffers, and political class that can propose a genuine and comprehensive plan for how to rebalance production, education, and technology for the better of ALL Americans. Surely...Tradcon SeekingTruth • 3 days agoAmerican Affairs (the policy journal this author writes for) and The American Compass are both very good.cka2nd SeekingTruth • 3 days agoI honestly wonder if Jack Kemp might have had a "Road to Damascus" conversion away from his pseudo-libertarian and supply side economic convictions if he had lived through the decade after the Great Recession. Probably not, given his political and economic activity up until his death.Barry_II • 3 days ago"They also left worker wages stagnant and increased the deficit. Where is our more nationalist economic policy?"Name • 3 days ago
In your dreams, just like those many large projects which Trump drove into bankruptcy.
Right alongside the money owed to the many people he's stiffed.So after 30 years or more of " globalism" , the GOP is adopting Bernie Sanderism?Johnny Larue Name • 3 days agoUh, no.Name Johnny Larue • 2 days agoUh, it seems so. Did you even read?TheSnark • 3 days ago • editedTrump pushed the tax cut because it saves him at least $20 million each year in taxes, probably closer to $50 million. That's the only reason he does anything, because he benefits personally.kouroi • 3 days agoThank you very much for posting the link to the wonderful essay by Mike Lofgren. Written 8 years ago it feels even more actual than then. I have bookmarked it for future reference.Kent kouroi • 3 days ago
Looking at the US it always comes to my mind the way Rome and then Byzantium fell: a total erosion of the tax-base the rich refused to pay anything to the imperial coffers, and then some of the rich had land bigger than some modern countries... And then the barbarians came...And, by then, the population welcomed the barbarians.kouroi Kent • 3 days agoLikely true, with some exceptions... The Huns - and on that one I keep wondering if there isn't a whiff of "Yellow Peril" smell in all that outcry...Ray Woodcock kouroi • 2 days ago • editedLofgren: "What I mean by secession is a withdrawal into enclaves, an internal immigration, whereby the rich disconnect themselves from the civic life of the nation and from any concern about its well being except as a place to extract loot."kouroi Ray Woodcock • 2 days ago
That was in 2012, but that was what struck me about my well-to-do classmates when I transferred from Cal State Long Beach to Columbia University in 1977 . Suddenly I was among people who saw America, American laws, and a shared sense of civic responsibility as quaint, bothersome, rather tangential to the project of promoting oneself and/or one's special interest.Cold, eh mate? Reptiles, lizards...?Adriana Pena • 3 days agoDid you ever hope that Trump would do what you wanted? You are adorablesam • 3 days agoThe only way that factories would come back is when Americans start buying made in America. We can't wait for ANY government to bring those factories and jobs ( and technology) . Only people voting with their pocketbooks can do it.J Villain • 3 days agoStill waiting for the day the first American asks "What have WE done wrong?" Rather than just following in Trumps step and playing the victim card every step of the way and wondering why nothing gets better.Blood Alcohol J Villain • 3 days agonuffsaid. The blood is on everyone's hands.
Feb 17, 2020 | ronpaulinstitute.org
Listening to the howls from Democrats and the applause from Republicans, one would think President Trump's proposed fiscal year 2021 budget is a radical assault on the welfare state. The truth is the budget contains some minor spending cuts, most of which are not even real cuts. Instead they are reductions in the "projected rate of growth." This is equivalent of saying you are sticking to your diet because you ate five chocolate chip cookies when you wanted to eat ten.
President Trump's plan reduces the Education Department's budget by nearly eight percent, leaving the department with "only" 66.6 billion dollars. Cuts to other departments are similarly small, while reductions in entitlement spending consist mostly of reforms that will not affect most of those dependent on these programs.
President Trump deserves credit for proposing an 11.6 billion dollars cut in funding for the Department of State and the US Agency for International Development (USAID). Foreign aid does little to help impoverished people overseas. Instead, it benefits foreign government officials willing to do the US government's bidding. The State Department and USAID are extensively involved in US intervention abroad, including efforts to overthrow governments.
President Trump's budget proposes a number of increases in spending. For example, his budget spends around 900 million additional dollars on vocational education. It also includes additional spending on items including infrastructure and childcare.
Few in DC have expressed concern over the fact that President Trump's 4.8 trillion dollars budget proposal is the largest budget in American history. There is also little outcry from supposedly antiwar progressive Democrats over Trump's proposal to spend hundreds of billions of dollars on militarism. This is not surprising, as many progressives are happy to support increased warfare spending as long as conservatives go along with increased welfare spending. Similarly, many conservatives are happy to support increased welfare spending as long as it means that progressives will vote for increased warfare spending. So, Congress is unlikely to approve any of President Trump's spending cuts, but Congress will gleefully agree to all of his spending increases.
Even if Congress agrees to all of President Trump's cuts, federal deficits will still be over one trillion dollars for the next several years. However, President Trump claims the budget will balance in 15 years. In order to show a balanced budget by 2035, the administration assumes three percent economic growth for most of the next decade. This level of growth is unlikely to come to pass. Instead, the current boom will likely end soon, and the economy will experience another major recession. Signs that we are on the verge of a downturn include rising homelessness and the Federal Reserve's bailout of the repurchasing market.
The current economic boom is built on debt, and the debt-based economy is facilitated by the Federal Reserve's easy money policies. The massive amount of debt held by consumers, businesses, and especially government is the main reason the Fed feels compelled to maintain historically low interest rates. If rates were to increase to market levels, government interest payments would be unstable. This would cause the government debt bubble to burst, leading to a major crisis. However, continuing on the current path of low interest rates will inevitably lead to a dollar crisis and a collapse of the welfare-warfare Keynesian system.
Continuing to waste billions on wars abroad and failed programs at home while pretending that we can avoid a crisis via phony cuts and Fed-fueled growth will only make the inevitable collapse more painful. The only way to avoid economic disaster is to cut spending and audit, then end, the Federal Reserve.
Copyright © 2020 by RonPaul Institute. Permission to reprint in whole or in part is gladly granted, provided full credit and a live link are given. Please donate to the Ron Paul Institute
Feb 16, 2020 | www.truthdig.com
In a move that drew outrage from labor unions and progressives, President Donald Trump this week quietly took steps to slash a scheduled pay raise for millions of federal workers from 2.5% to 1% due to supposed concerns about "keeping the nation on a fiscally sustainable course."
"I have determined that for 2021 the across-the-board base pay increase will be limited to 1.0%," Trump said in a message to Congress on Monday. "This alternative pay plan decision will not materially affect our ability to attract and retain a well‑qualified federal workforce."
The president's proposed "adjustment" to the scheduled pay raise will take effect in January 2021 unless Congress passes legislation to override the change.
Just a day after his message to Congress, Trump tweeted , "BEST USA ECONOMY IN HISTORY!"
Critics highlighted the disconnect between the president's justification for cutting the planned raise for federal workers and his boasts about the state of the U.S. economy.
"Trump claimed we had the 'BEST USA ECONOMY IN HISTORY' and cited 'serious economic conditions affecting the general welfare' to justify limiting pay increases for federal workers," tweeted Rep. Steve Cohen (D-Tenn.). "These are contradicting claims. They can't both be true."
This is just the latest action in @realDonaldTrump 's war on civil servants. He held their pay hostage during the failed #TrumpShutdown , worked to undermine their collective bargaining rights and proposed cuts to their retirement benefits. #TrumpBudget .
-- Steve Cohen (@RepCohen) February 12, 2020
Slate 's Elliot Hannon wrote Wednesday that "cutting the 2.5% raise set for 2021 to 1% for millions of federal workers seems a bit austere in the face of such self-proclaimed boom times."
"Even more absurdly, Trump is justifying ordering the cut on the grounds that the country is in the midst of a 'national emergency or serious economic conditions affecting the general welfare,' which the White House says authorizes the president to 'implement alternative plans for pay adjustments,'" Hannon added. "So which is it? The best economy in the history of economies or a national economic emergency? Either way, somebody's lying."
Pat Garofalo, managing editor at Talk Poverty , tweeted that warnings about fiscal sustainability are not credible coming from the president who signed into law $1.5 trillion in tax cuts for the rich in 2017.
The administration approved trillions of dollars in tax cuts for the wealthy and corporations, but sure, shortchanging federal employees is what will set the nation on a "fiscally sustainable course" https://t.co/3cmDRB5D60
-- Pat Garofalo (@Pat_Garofalo) February 12, 2020
Trump's move came on the same day he proposed his budget for fiscal year 2021, which proposes cutting federal workers' retirement benefits as well as Medicare, Medicaid, and Social Security .
Tony Reardon, president of the National Treasury Employees Union (NTEU), the largest independent union of federal workers in the U.S., said a 1% pay raise would "do nothing to close the gap between federal employee salaries and their higher-paid private sector counterparts, it won't keep up with inflation, it won't keep up with private sector wage increases."
"For an administration that has added $3 trillion to the federal debt, gouging federal employee pay and benefits in the name of deficit reduction is ridiculous," Reardon said in a statement . "NTEU will fight these regressive proposals on retirement while supporting existing legislation calling for a 3.5% pay increase in 2021."
Jan 30, 2020 | www.zerohedge.com
Now, Trump has said offhandedly that there's been talk of reinstating the deductions and raising the mortgage cap. But for the most part, this seems like idle talk . The federal budget deficit has exploded, but Trump and his team are still talking up their tax-reform part 2 (though it's likely this chatter mostly a ruse to pump the market). But suspect any tax cuts between now and November will be focused squarely on aiding the midwestern states who handed Trump the presidency.
Since the tax-reform package was passed, what was once a trickle of blue-staters fleeing places like California, New York, New Jersey, Connecticut and even Texas over the past two years has become a flood.
And after a smattering of stories detailing the gradual migration from high-cost blue states and cities like San Francisco and New York (we've paid close attention to the trend over the years ), two WSJ banking reporters have published a deep dive on the trend, signaling its arrival as a major national issue.
Just like Carl Icahn and David Tepper left New York and New Jersey for Florida, millions of Americans are following suit, swapping Connecticut for Florida, Nevada or Arizona.
Two years after President Trump signed the tax law, its effects are rippling through local economies and housing markets, pushing some people to move from high-tax states where they have long lived. Parts of Florida, for example, are getting an influx of buyers from states such as New York, New Jersey and Illinois.
Though the exact figures have probably changed since the tax reform was passed, this map helps illustrate how capping SALT and lowering threshold for mortgages impacted each state.
While President Trump, Secretary Mnuchin and the rest of the administration have insisted that they capped the deductions to end what they described as an unfair subsidy for blue states . The average US property tax bill in 2018 was about $3,500, according to Attom Data Solutions, a real-estate data firm cited by WSJ. But in New York, New Jersey and Connecticut, hundreds of thousands of residents make annual property tax payments well above that level. In New York's tony Westchester County, the average property tax bill is more than $17,000.
Most of the people interviewed by WSJ said they had long considered moving to a more tax-friendly state. But for many, Trump's tax plan was the catalyst to actually act on these impulses.
"It was another bucket of straw on the back of the camel," said John Lee, a wealth-management executive and longtime resident of the Sacramento, Calif., area. Mr. Lee and his wife, Tracy, moved their primary residence last winter to Incline Village, a resort community on the Nevada side of Lake Tahoe.
The Lees kept their California home, where one of their six adult children is living. That means they are still paying California property taxes. But Mr. Lee estimates the move to Nevada, which has no state income tax, whacked his state tax bill by 90%.
The impact on housing markets in the ten most heavily taxed states has been impossible to ignore. The Manhattan luxury housing market is showing signs of serious distress that's provoking anxieties among the wealthy developers who were expecting a boom in demand. According to Fitch Ratings, home-price appreciation in these states declined almost immediately after the tax reform package was passed. By comparison, home-price appreciation was steady for the 10 states with the lowest property taxes and levels of mortgage interest.
Among Gen Xers and Boomers who have only recently achieved empty-nest status, plotting an escape from taxation hell has become a simple tenant of good retirement planning.
Rick Bechtel, head of U.S. residential lending at TD Bank, lives in the Chicago area and said he recently went to a party where it felt like everyone was planning their moves to Florida. "It's unbelievable to me the number of conversations that I'm listening to that begin with 'When are you leaving?' and 'Where are you going?'" he said.
Even some states known for having relatively low taxes are being affected by this trend, as some residents opt for states with no income tax, like Florida or Nevada.
TimmyB , 8 minutes ago linkHeavenstorm , 25 minutes ago link
Trumps supposed tax cut was really a tax increase on many Americans. When I see multi billion dollar corporations like Amazon paying nothing in taxes because Trump gave them a tax cut, and working people in blue state paying for those tax cuts by having their taxes increased, it is little wonder why voters are turning to Sanders.
New York has become the global city hub of Globalists. California has become a globalist state.
Apr 02, 2019 | www.nytimes.com
... ... ...
So far, Donald Trump has passed only one significant piece of legislation: the 2017 tax cut. It was, to be fair, a pretty big deal: corporations, the principal beneficiaries, have already saved more than $150 billion, and over the course of a decade the tax cut will probably increase the budget deficit by more than $2 trillion.
But the tax cut was supposed to do more than just give stockholders more money -- or at least that's what its proponents claimed. It was also supposed to lead to many years of high economic growth, 3 percent or more at an annual rate.
Independent observers were skeptical, to say the least. They conceded that the tax cut might lead to a brief sugar high, because that's what big deficits do. But any favorable effects on growth, they argued, would soon fade out. And they always insisted that it would take some time to assess the tax cut's actual effects.
Nonetheless, when the economy grew pretty fast in the second quarter of last year, Trump and his supporters cried vindication, and ridiculed the critics.
But a bit of time has passed since then. The chart shows the U.S. economy's growth rate by quarter since the beginning of 2018. The last number isn't official; but there are a number of independent observers, including both Federal Reserve banks and private financial institutions, who produce "nowcasts" that estimate growth based on early data. At this point all of these nowcasts show slowing growth, and most put the first quarter at around 1.5 percent.
So do the results so far look like the huge, sustained boom the Trump camp promised, or the brief sugar high predicted by the critics?
But Donald Trump is a special kind of leader. When things don't go his way, when events fail to turn out as he planned and promised, he always knows exactly what to do: Blame someone else . Sure enough, he's now asserting that we'd be having a yuge economic boom, 3 percent growth, all that, if only the Federal Reserve hadn't raised interest rates.
O. K., this is where you need to be able to hold two ideas in your head at the same time. Was the Fed wrong to raise rates? Probably yes. Does this account for the failure of the Trump tax cut? No.
The Fed was clearly overoptimistic about the economy's prospects, as it has pretty consistently been for the past decade. It's worth noting that throughout that whole period conservative critics of the Fed -- the same people now backing Trump -- attacked the institution for keeping interest rates too low, not too high. Still, it's now clear that the attempt to normalize monetary policy was premature.
But the Fed's premature rate hikes aren't why the Trump tax cut is failing. How do we know that? Because all those boasts about why the tax cut would work miracles were based on a specific story about what is holding the U.S. economy back. And that story was and is all wrong.
The Trumpist theory -- which was, I'm sorry to say, endorsed by conservative economists who should have known better -- was that there was a huge pile of money sitting outside the U.S. that companies would bring back and invest productively if given the incentive of lower tax rates. But that pile of money was an accounting fiction. And the tax cut didn't give corporations an incentive to build new factories and so on; all it did was induce them to shift their tax-avoidance strategies.
As Brad Setser of the Council on Foreign Relations points out , a casual glance at the data seems to suggest that American companies earn a lot of their profits at their overseas subsidiaries. But a closer look shows that the bulk of these reported profits are in a handful of small countries with low or zero tax rates, like Bermuda, Luxembourg and Ireland. The companies obviously aren't earning huge profits in these tiny economies; they're just using accounting gimmicks to assign profits earned elsewhere to subsidiaries that may have a few factories, but sometimes consist of little more than a small office, or even just a post-office box.
These basically phony profits then accumulate on the books of the overseas subsidiaries, rather than the home company. But this doesn't affect their ability to invest in America: if Apple wants to spend a billion dollars here, it can always borrow the money using the assets of its Irish subsidiary as collateral. In other words, U.S. taxes weren't having any significant effect in deterring real investment in the U.S. economy.
When Trump cut the tax rate, some companies "brought money home." But for the most part this had no economic significance. Here's how it works: Apple Ireland transfers some of its assets to Apple U.S.A. Officially, Apple Ireland has reduced its investment spending, while paying a dividend to U.S. investors. In reality, Apple as an entity has the same total profits and the same total assets it did before; it hasn't devoted a single additional dollar to purchases of equipment, R&D, or anything else for its U.S. operations.
Not surprisingly, then, the investment boom Trump economists promised has never materialized . Companies didn't use their tax breaks to invest more; mainly they used them to buy back their own stock. This in turn, put more money in the hands of investors, which gave the economy a temporary boost -- although for 2018 as a whole, one of the biggest drivers of faster growth was, believe it or not, higher government spending .
So the theory supposedly behind the Trump tax cut has turned out to be a complete bust. Corporate accountants got to have some fun exploring new frontiers in tax avoidance; the rest of us just ended up saddled with an extra $2 trillion or so in debt.
Now, I'm not deeply worried about that debt. Given low borrowing costs , the costs and risks of federal debt are far less than the usual suspects -- again, the same people who cheered on the Trump tax cut -- have claimed. But think of all the other things we could have done with $2 trillion -- all the infrastructure we could have built and repaired, all the people who could have been given essential health care.
What a colossal, corrupt waste.
Paul Krugman has been an Opinion columnist since 2000 and is also a Distinguished Professor at the City University of New York Graduate Center. He won the 2008 Nobel Memorial Prize in Economic Sciences for his work on international trade and economic geography. @ PaulKrugman
Grennan Green Bay April 2The GOP has announced a comprehensive bipartisan effort to reform our tax code, promote fairness, and provide health coverage. APRIL FOOLS! The U.S. has put a tax evader in charge, who has in turn named Sen. Scott, the former CEO who steered the largest Medicare fraud in our history, to develop a health coverage plan. No, that's not April Fools, but reality.Working Mama New York City April 1I resent the Trump tax travesty being referred to as a "tax cut". For many middle class homeowners, it was anything but. Just the elimination of personal exemptions for my family of four cost us more in increased tax liability than the increase in the standard deduction. Then there were tens of thousands of dollars' worth of deductions that we didn't get to take under the new rules. Our tax liability went up by thousands.Stephen Saint Louis, MO April 1I have not had any fun as corporate tax accountant from Trump's giveaway to the rich. Firstly, the law was not planned out, so there is no guidance for any of the new laws. The IRS is scrambling just to get new instructions and forms out. I'd bet that the confusion is creating more opportunities to avoid taxes than there were before. Secondly, I get to deal with the whining of the beneficiaries of the tax cut. Somehow they aren't satisfied with paying 40% less. Corporations and the 1% have a criminally high sense of entitlement.Bill NYC, NY April 1Supply side economics was, is, and always will be, almost a complete lie. Put simply, if consumer spending doesn't increase, why would a company spend money to produce more products? It is demand, not supply, that drives economic growth. And it should not come as a surprise that government spending creates economic growth when so much of the economy is tied to government spending. If you cut government spending, as Republicans wish, other than the government employees suddenly out of work, there are all the private businesses that depend on government contracts that will be laying off workers. So the economy contracts, other businesses become pessimistic and the economy contracts even further. Where I disagree with Paul is that we need the Fed to raise interest rates before the next recession hits. The economy has been strong for a decade but when a recession comes around, we need the Fed's ability to reduce rates and encourage borrowing.Barry Williams NY April 1@Bill The effects of government spending (or lack thereof) should be obvious to the economics-challenged just by looking at what happened during Trump's government shutdown. Hint: it wasn't just bad for the people who were directly not being paid for their government jobs. And that was only a brief microcosm of the effect. What I don't get is why people thought this time would be different, when it has never worked as advertised before. Did they think Trump would make it work this time?Martha Stephens Cincinnati April 1Krugman shows little caring about common people -- taxes or otherwise. He wants people to have "healthcare," but what does he mean by that? He doesn't support Medicare for All he has said. He doesn't seem to know that it would be paid for by US, not the government -- along with our taxes, in the way that makes the most sense everywhere. We'd pay according to our incomes; if you had NO income, you'd still have healthcare, birth to grave. Especially in times of recession, let Krugman put that in his pipe and smoke it!Joe Maliga San Francisco April 1
Medicare for All would not break the government; private insurance would still be allowed, but more and more people would like a universal plan with the low rates it would bring --as we get out from under the high prices we're paying for private health insurance, even the Medicare Advantage run by companies like Aetna. Mine costs nearly $400 a month!Money, power and greed is what the whole Trump presidency is about. A few people are getting very rich. In the meantime, his base is fueled by diversionary red meat. I think every American should get a cut of the ill-gotten gains. A monthly check for enduring this presidency, and the stupid people who support him.Dangoodbar Chicago April 1There is one point in Professor Krugman's article that needs to be highlighted; "although for 2018 as a whole, one of the biggest drivers of faster growth was, believe it or not, higher government spending." Government spending, not tax cuts has fueled recoveries from recessions caused by their policies from Reagan to Bush Jr. That is, if you look at what happened when both Reagan and Bush Jr. first took office and began their policies those policies resulted in recessions. Both Reagan and Bush Jr. got out of those recessions by going on huge spending binges. The point being that well Republicans do cut taxes for the super rich and powerful, the disguise the fact that those policies do not benefit America by going on huge deficit spending binges that, to quote Lloyd Benson, "Create an illusion of prosperity". The fact that Republicans use large increases in deficit Government spending for all of their economic success is the most unreported fact in American politics.R. Littlejohn Texas 10h ago@Dangoodbar The military industrial complex must be doing well, great for shareholders.Randy North Carolina April 1I am not sure why I should put any stock in any of your opinions/predictions when you have been so colossally wrong (e.g. "the stock market will crash if Trump gets elected") so often. Nobel Laureate? You and Yasser Arafat - The Nobel Prize committee doesn't always get it rightmusic observer nj April 1@Randy Well, let's compare Dr. Krugman to the GOP: 1)Since the 1970's, they have claimed that supply side economics ie cutting taxes, will 'float all boats', and since the 1980's the tax rate on the most well off has plummeted..and since then? The top .5% have seen huge gains, while the bottom 90% of Americans have seen their incomes and wealth fall. 2)The GOP under Obama said the budget deficits caused by government spending were going to cause hyperinflation and cause the dollar to become valueless, they screamed with the economic bailouts and so forth. Yet the world didn't end, and now the GOP just added 2 trillion to our debt, and saying "it is no big deal"..so who was right 3)Trump claimed the tax cut was going to make the economy sing, that it was going to grow at 5% a year and that ordinary people were going to see their decline in wages end.......fast forward 2 years, and wages have not grown faster than inflation, and despite a supposedly tight labor market, wages are still not growing...and the only people seeing increases in wealth and income are the top .5%, they saw a huge increase last year thanks to the corporate tax cut. So whose predictions were wrong?R. Littlejohn Texas 9h ago@music observer The working middle class has been shrinking since the supply side Reaganomics started and it has never stopped since. There is not much of the Great Society left, the Republicans are still cutting the benefits for Medicare and Medicaid and food stamps, Head Start disappeared too as far as I can tell. The Republican party is morally and intellectually bankrupt.JPH USA April 1Americans comment about tax or not tax. Free market. But there is absolutely no precise conscience of the numbers nor how the American economy works. Where the US corporations are domiciliated . In Europe ? We don't care. No comment. We cheat ? we don't care. No comment . Who are these people ?
Mar 31, 2019 | www.nakedcapitalism.com
Last year, drugmaker Abbvie Inc. told shareholders that its tax rate would fall to just 9 percent from 22 percent previously due to a change in the territorial system. Abbvie happens to be a grandmaster when it comes to shielding its profits in tax havens, routinely reporting zero profits in the US despite most of its research facilities being based in the country.
Pfizer, Boston Scientific Corp. ,Microsoft Inc. Synopsis and Expedia Group are all pros at the game, too.
This bunch, however, have nothing on Amazon Inc. The ecommerce giant not only managed to pay zero tax on its massive $11.2 billion corporate income for 2018, but was even able to claim $129 million in rebates thanks to loopholes in the new tax law. Video streaming company, Netflix Inc ., also managed to get away scot free despite posting a record profit of $858 million.
Still, an extra $700 billion flowing into the economy in a year is hardly chicken feed. So, has the money being used to create more jobs as Trump hoped? Hardly. The evidence suggests that majority of that cash has simply found its way into buybacks with minimal discernible impact on investments. It's probably not a coincidence that the generous tax cut has been followed by record buybacks, with companies repurchasing more than a trillion dollars-worth of their own shares last year.
Ironically, Congress now wants to tame the monster it has helped create by reining in on buybacks. But with fears that a market top could be near, the timing would be wrong since buybacks provide a large source of demand for shares.
upstater , March 30, 2019 at 8:36 am
"Congress failed to anticipate a major loophole" Huh? Its not a bug, its a feature.
noonespecial , March 30, 2019 at 6:16 pm
NC readers may have seen/linked the following
In an article by Mehan R. Wislon in "The Hill" (12/01/17) one can read that:
"With their enormous complexity and high-stakes, tax issues are the buffet that keeps Washington's swamp creatures fed," Public Citizen said in the conclusion of its report. "
"But the success of the nation's largest corporations and wealthiest interests in shaping the current tax legislation to suit their interests shows that bankrolling the lobbyists' unending feast is a small bill to pay in the big scheme of things -- because it is a very big scheme, indeed."
Sound of the Suburbs , March 30, 2019 at 9:28 am
American companies are trying to tell us they are demand driven and they won't invest in expansion until they can see the demand in the system to make it worth their while.
Sound of the Suburbs , March 30, 2019 at 9:59 am
How would an open, globalised world work against the West and in favor of the East? The 1% would get better returns from investing their capital in the rapidly growing Asian economies than the mature economies of the West. Multi-national corporations could make higher profits in Asia due to the low cost of living that they had to cover in wages.
(Employees get their money from wages, so the employer pays through wages.)
The West never did work out what was going on, but now the more developed Eastern economies are seeing the same thing and are looking into it.
Richard Koo explains: https://www.youtube.com/watch?v=AtwxhT8e7xQ Higher returns on capital are affecting their economies as they off-shore to places where they can pay lower wages for higher profits.
Richard Koo asked American firms where they are expanding their capacity. They said it was in Mexico as it's cheaper and they can make more profit. Do the maths. To maximise profit you need to minimise labour costs, i.e. wages. Disposable income = wages – (taxes + the cost of living). The minimum wage leaves no disposable income. Minimum wage = taxes + the cost of living
The cost of living = housing costs + healthcare costs + student loan costs + food + other costs of living
Employees get their money from wages and employers have to pay the US cost of living in wages unless they off-shore to somewhere cheaper, like Mexico.
The developed Eastern economies are now finding they are in same situation as the West has been for the last few decades and they are coming up with explanations and solutions, unlike our own experts.
John , March 30, 2019 at 10:02 am
The American people should be screaming about the fact most of these corporations barely pay any taxes at all to keep this country running. But silence. Why is there such slavish loyalty to corporations by Americans when most aren't even employed by them?
Synoia , March 30, 2019 at 1:39 pm
Why is there such slavish loyalty to corporations by Americans when most aren't even employed by them?
Who exhibits the "slavish loyalty?" Then you will know who benefits, and is paid the most, by these selfsame corporations.
The Rev Kev , March 30, 2019 at 10:23 am
Well that is twice now that corporate America has repatriated hundreds of billions from overseas and each time, so far as I know, it was used for stock buybacks, executive bonuses, vanity projects, etc. Not for investment, not for research, not for up-skilling their workforce or expanding their operations but just playing Wall Street games.
I would judge that before trying to go after all this money overseas, that it will be necessary to impose a working taxation system on corporate America first. To earn over $11.2 billion in tax but to not only not get taxed but to earn a rebate illustrates how broken the system is.
At the moment, the corporate tax rate is supposed to be 21% so perhaps they can bring out a tax on gross corporate income of 21% – but with no rebates or anything at all that can be taken from this amount. Just a flat out tax.
By my calculations, Jeff Bezos thus owes the US government $2,352,000,000 in taxes. I'm sure that a cheque from him would do just fine.
Janie , March 30, 2019 at 1:59 pm
"Duh" is fewer key strokes than "quelle surprise", but it's not as classy.
Feb 12, 2019 | www.zerohedge.com
For better or worse, Republican Senator and one-time presidential candidate Marco Rubio isn't about to let the Democrats own the fight to curtail one of the most flagrant examples of post-crisis corporate excess. And if he can carve out a niche for himself that might one day help him credibly pitch himself as a populist firebrand, much like the man who went on to claim the presidency after defeating him in the Republican primary, well, that sounds to us like a win-win.
To that end, the senator from Florida on Tuesday unveiled a proposal to limit corporate buybacks. Unlike a plan pitched by Bernie Sanders and Chuck Schumer earlier this month, Rubio's plan would seek to end preferential tax treatment of share buybacks, by decreeing that any money spent on buybacks would be considered - for tax purposes - a dividend paid to shareholders, even if individual investors didn't actually part with any stock.
According to CNBC , the plan calls for every shareholder to receive an imputed portion of the funds equivalent to the percentage of company stock they own, which, of course, isn't the same thing as directly handing capital to shareholders (it simply changes the tax rate that the company buying back the shares would pay).
Ultimately, Rubio hopes that these changes would discourage companies from buying back stock. Those companies that continued to buy back shares would help contribute to higher revenues by increasing the funds that can be taxed, while also raising the rate at which this money can be taxed. Any tax revenue generated by these changes could then be used to encourage more capital investment, Rubio said. As part of the proposal, Rubio would make a provision in the tax law that allows companies to deduct capital investment permanent (that provision is currently set to expire in 2022).
But before lawmakers take their next steps toward regulating how and when companies should return excess capital to shareholders, they might want to take a look at a column recently published by WSJ's "Intelligent Investor" that expounds a concept called "the bladder theory."
Overall, however, buybacks (and dividends) return excess capital to investors who are free to spend or reinvest it wherever it is most needed. By requiring companies to hang onto their capital instead of paying it out, Congress might - perhaps - encourage them to invest more in workers and communities.
But the law most likely to govern here is the Law of Unintended Consequences. The history of investment by corporate managers with oodles of cash on their hands isn't encouraging. Hugh Liedtke, the late chief executive of Pennzoil, reportedly liked to quip that he believed in "the bladder theory:" Companies should pay out as much cash as possible, so managers couldn't piss all the money away.
That companies bought back a record $1 trillion worth of stock last year while employers like GM slashed jobs and closed factories has stoked criticisms of the Trump tax cuts, but as the gulf between the rich and the poor grows ever more wide (a phenomenon for which we can thank the Federal Reserve and other large global central banks) it's worth wondering: facing a simmering backlash to one of the most persistent marginal bids in the market place, have investors already become too complacent about proposals like Rubio's?
We ask only because the Dow soared more than 350 points on Tuesday, suggesting that, even as Rubio added a bipartisan flavor to the nascent movement to curb buybacks, investors aren't taking these proposals too seriously - at least not yet.CelotexThis still doesn't address the insider trading aspect of stock buybacks, with insiders front-running the buyback.
No one's arguing that if a company's groaning with cash then buybacks make sense. But it's the other 95% of of them that are the problem. Compare the 20 year graphs of buybacks with corporate profits, corporate debt, corporate tax paid, corporate dividends paid.
They tell you what everyone in higher management knows - that they're a tax-free dividend mechanism pretending to be "capital rationalisation".
Worse, since they're largely funded by increased corporate debt (!) they amount to corporate strip-mining by senior management. This is disgraceful and dangerous. The debt will bust some corporations when the inevitable next downturn comes.
This buyback cancer, which has grown rapidly because of corrupt SEC thinking and perverse tax incentives, requires urgent treatment.
james diamond squid
Everyone is in on this ponzi. I'm expecting tax deductions for buying stocks/homes.
Feb 12, 2019 | finance.yahoo.com
Microsoft co-founder Bill Gates does not think the way to increase U.S. tax revenue is through policies like raising the tax rate on the wealthy to 70 percent – as has been floated by some Democratic lawmakers like New York Rep. Alexandria Ocasio-Cortez.
During a podcast interview with The Verge , Gates responded to a question about whether raising the top rate to 70 percent in order to fund social programs – like infrastructure initiatives – appeals to him by saying government can be more effective in running social programs, but that's not the best way to raise revenue.
"You finally have some politicians who are so extreme that I'd say, 'No, that's even beyond,'" Gates said. "You do start to create tax dodging and disincentives, and an incentive to have the income show up in other countries and things."
Gates added that the country's richest people often don't pay the highest rate because their wealth doesn't always show up as income, it can be in the value of their stock, for example.
"So it's a misfocus," he added. "If you focus on that, you're missing the picture."
The billionaire businessman, however, does believe there are ways to make the current tax code more progressive. Some of those ways include more progressive policies regarding the estate tax, the tax on capital, or reforming FICA and Social Security taxes. Independent Vermont Sen. Bernie Sanders recently released a proposal to expand the estate tax to a rate of 77 percent for those passing on assets in excess of $1 billion.
CLICK HERE TO GET THE FOX BUSINESS APP
Bill Gates also called modern monetary theory (MMT) – which asserts that because the government controls its own currency, there is no need to worry about balancing the budget – "some crazy talk." Ocasio-Cortez recently indicated she was open to supporting MMT.
Gates is one of the richest people in the world. He has said, despite the fact that he has paid more in taxes than most, he should be paying more .
Feb 07, 2019 | economistsview.typepad.com
anne , February 06, 2019 at 04:05 PMhttps://www.nytimes.com/2019/02/06/opinion/business-economics/trump-tax-reform-state-of-the-union-2019.htmlanne -> anne... , February 07, 2019 at 06:16 AM
February 6, 2019
The Global Con Hidden in Trump's Tax Reform Law, Revealed
Why would any multinational corporation pay the new 21 percent rate when it could use the new "global minimum" loophole to pay half of that?
By Brad Setser
Last night, President Trump reserved a few minutes of his State of the Union address to praise his tax reform law, which turned a year old last month. To promote its passage, Mr. Trump and his congressional allies promised Americans that drastically lowered corporate tax rates would bring home large sums of capital that had been stashed overseas and finance a surge of domestic investment.
"For too long, our tax code has incentivized companies to leave our country in search of lower tax rates," he said, pitching voters in the fall of 2017. "My administration rejects the offshoring model, and we have embraced a brand-new model. It's called the American model."
The White House argued they wanted a system that "encourages companies to stay in America, grow in America, spend in America, and hire in America." Yet the bill he signed into law includes a sweetheart deal that allows companies that shift their profits abroad to pay tax at a rate well below the already-reduced corporate income tax -- an incentive shift that completely contradicts his stated goal.
Why would any multinational corporation pay America's 21 percent tax rate when it could pay the new "global minimum" rate of 10.5 percent on profits shifted to tax havens, particularly when there are few restrictions on how money can be moved around a company and its foreign subsidiaries?
These wonky concerns were largely brushed aside amid the political brawl. But now that a full year has passed since the tax bill became law, we have hard numbers we can evaluate.
For starters, the law's repatriation deal did prompt a brief surge in offshore profits returning to the United States. But the total sum returned so far is well below the trillions many proponents predicted, and a large chunk of the returned funds have been used for record-breaking stock buybacks, which don't help workers and generate little real economic activity.
And despite Mr. Trump's proud rhetoric regarding tax reform during his State of the Union address, there is no wide pattern of companies bringing back jobs or profits from abroad. The global distribution of corporations' offshore profits -- our best measure of their tax avoidance gymnastics -- hasn't budged from the prevailing trend.
Well over half the profits that American companies report earning abroad are still booked in only a few low-tax nations -- places that, of course, are not actually home to the customers, workers and taxpayers facilitating most of their business. A multinational corporation can route its global sales through Ireland, pay royalties to its Dutch subsidiary and then funnel income to its Bermudian subsidiary -- taking advantage of Bermuda's corporate tax rate of zero.
Where American Profits Hide
No major technology company has jettisoned the finely tuned tax structures that allow a large share of its global profits to be booked offshore. Nor have major pharmaceutical companies stopped producing many of their most profitable drugs in Ireland. And Pepsi, to name just one major manufacturer, still makes the concentrate for its soda in Singapore, also a haven.
Eliminating the complex series of loopholes that encourage offshoring was a major talking point in the run-up to the 2017 tax bill, but most of them are still in place. The craftiest and largest corporations can still legally whittle down their effective tax rate into the single digits. (In fact, the new law encourages firms to move "tangible assets" -- like factories -- offshore).
Overall, the Tax Cuts and Jobs Act amounted to a technocratic sleight of hand -- a scheme set to shift an even greater share of the federal tax burden onto the shoulders of American families. According to the Treasury Department's tally for fiscal year 2018, corporate income tax receipts fell by 31 percent, an unprecedented year-over-year drop in a time of economic growth (presumably a time when profits and government revenue should rise in tandem).
These damning results, to be sure, don't make for a good defense of what came before the new law. In theory under the old system, American-based firms still owed the government a cut of their global profits. In practice, large firms could indefinitely defer paying this tax until the funds could be repatriated -- usually when granted a tax holiday by a friendly administration.
Over a generation, this political dance was paired with rules that made it relatively easy for firms to transfer their most prized intellectual property -- say, the rights to popular software or the particular mix of ingredients for a hot new drug -- to their offshore subsidiaries. Taken together, they created a tax nirvana of sorts for multinational corporations, particularly in intellectual-property-intensive industries like tech and pharmaceuticals. But it wasn't enough.
For their next trick, the companies worked with their political allies to favorably frame the 2017 tax debate. When he was the House speaker, Paul Ryan was fond of talking about $3 trillion in "trapped" profits abroad. But those profits weren't actually, physically, sitting in a few tax havens.
Dwarf Economies, Giant American Profits
They were largely invested in United States bank accounts, securities and bonds issued by the Treasury or other companies headquartered in the States. As Adam Looney -- a Brookings Institution fellow and former Treasury Department official -- has explained, companies that needed to finance a new domestic investment could simply issue a bond effectively backed by its offshore cash. (For instance, Apple could bring its "trapped" funds onshore by selling a bond to Pfizer's offshore account, or vice versa.)
Put plainly, they got the best of both worlds: Uncle Sam could tax only a small slice of their books while they traded with one another based on the size of the entire pie.
The scale of the tax shifting has become so immense that some economists believe curbing it could raise reported G.D.P. by well over a percentage point -- something Mr. Trump, who's been absorbed by opportunities to brag about the economy, should notionally welcome.
President Trump's economic advisers and the key architects of the bill on Capitol Hill must have known their reform wasn't going to end business incentives that hurt American workers. Honest reform would have meant closing corporate loopholes -- a move they originally promised to make.
Should the opportunity present itself, perhaps to the next president, there are a couple of viable options for a fundamental tax overhaul that wouldn't require reinstating the 35 percent corporate tax rate.
One of several possibilities is to return to a system of global taxation without the deferrals that enabled empty repatriations. That would mean profits sneakily booked tax-free in Bermuda would be taxed every year at 21 percent. Profits booked in Ireland -- or other low-tax nations -- would be taxed at the difference between Ireland's rate and America's rate.
It's an approach that would protect small and midsize American companies while cracking down on bad corporate actors with enough fancy accountants and lawyers to rig the game to their advantage. And it would be far better than the fake tax reform passed a year ago.https://twitter.com/paulkrugman/status/1093271623212457985
Paul Krugman @paulkrugman
This is very good from the essential Brad Setser, our leading expert on international trade and money flows. Bottom line: the Trump tax cut is a giveaway to corporations that doesn't promote investment here 1/
The Global Con Hidden in Trump's Tax Reform Law, Revealed
Why would any multinational corporation pay the new 21 percent rate when it could use the new "global minimum" loophole to pay half of that?
2:14 PM - 6 Feb 2019
@Brad_Setser also gets at something I've been trying to explain: corporate cash "overseas" isn't really a stash of money that can be brought home, it's an accounting fiction that lets them avoid taxes, with no real consequences for investment 2/
And this chart, showing the predominance of tax avoidance in overseas "investment", is a classic 3/
Nov 12, 2018 | www.rt.com
Tax havens are used as an instrument to increase the profitability of US multinationals at the expense of the public, according to investigative economist and lawyer James Henry. He told RT that there's a tiny group of the world's elite professionals, banks, law firms, and accounting firms that make a nice living from the global tax haven industry. Multinational companies, and their shareholders to some extent, have benefitted from the fact that they were able to park US profits offshore and avoid paying US corporate income tax.
"The rest of us who have to pay for the taxes that corporations are not paying, are seeing the race to the bottom, we're seeing many countries around the world slashing corporate taxes and putting more of the costs of the government on ordinary taxpayers," said Henry, a senior advisor at the Tax Justice Network.
He explained that America's wealthy kleptocrats, tax-dodgers, and particularly multinational companies have been massively parking money offshore. By 2017, US multinationals have "accumulated about $2.6 trillion offshore while they didn't have to pay the 35 percent US corporate tax," the economist said.
Henry points out that the Trump administration has slashed that tax to about 15 percent and now they have eight years to pay it while not even being required to repatriate the money hoarded offshore.
"The new tax bill was a disaster but it did benefit the major companies by allowing them to get their $2.6 trillion back home tax free," Henry said.
The senior fellow at Yale noted that bringing the tax rate back to less than five percent from the current fifteen, would mean "a $600 – 800 billion gift to the wealthiest companies on the planet." Ninety percent of corporate shares are owned by the top one percent, he said.
Tax havens are used as an instrument to increase the role of profitability of the US multinationals and the oil companies all use tax havens aggressively to reduce taxation, according to Henry.
In general, since the financial crisis the world has increased its debt levels to an unprecedented proportion. So, the countries tended to borrow to fill the gap. "It would go a long way over time toward chipping away from the massive debt burden that we have."
The US has actually become a safe haven of its own, Henry said, adding that there's no beneficial ownership reporting, no country by country reporting. "The US has some of the most aggressive enablers on the planet – accounting firms and law firms that are enabling this activity. A lot of multinationals that have been exploiting the tax haven system are US companies like Apple, Google, and Microsoft."
While historically the US has always been a proponent of a progressive taxation lately that's been lagging, he stressed.
For more stories on economy & finance visit RT's business section
- Tax evasion helps US corporations steal $180bn from the rest of the world every year
- America's richest 1% owns 40% of country's wealth - study
- Soaring by $38,000 per second: US national debt now exceeds $21.5 trillion
Feb 04, 2019 | finance.yahoo.com
New York collected $2.3 billion less income-tax revenue than predicted for December and January, a development that Governor Andrew Cuomo blamed on wealthy residents leaving for second homes in Florida and other states that received more favorable treatment in the tax law enacted by President Donald Trump and the Republican Congress.
The shortfall will require a new look at the $175 billion budget Cuomo submitted to the legislature last month, he said. If the trend continues, the governor said it would affect spending on high-expense items such as health, education, infrastructure and a planned middle-class tax cut.
"There is no doubt that the budget we put forward is not supported by the revenue," the Democratic governor said during a news conference in Albany. "If even a small number of high-income taxpayers leave, it has a great effect on this tax base. You are relying on a very small number of people for the vast amount of your tax dollars."
While acknowledging that stock market volatility is among several factors that may have suppressed income-tax revenue in the past two months, the governor placed most of the blame on Trump and the Republican-dominated Congress of 2017, which enacted a tax plan limiting federal deductions on real estate and other local taxes.
Related: New York's Income-Tax Revenue Falls 'Abruptly' Under Forecast
"It was politically diabolical and also highly effective," Cuomo said. "And if your goal is to help Republican states and hurt Democratic states this is the way to do it."
Jan 29, 2019 | angrybearblog.comWait long enough, and great ideas come back around, although not necessarily wearing the same garb.
Elizabeth Warren has just come out for a 2% wealth tax (above $50 million).* But this is simply an annualized version of my lump sum stochastic jubilee .
What's the advantage of redistributing the whole thing every 50 years (on average) vs a steady trickle? A periodic reset would interrupt long run processes of wealth inequality more fully than a tax, so long as the rate of return on financial assets is high enough to compensate for the extra annual pinch, which it most likely would be, since wealth holders would demand a higher rate of return. It would also be a lot more fun.
On the other hand, it would be more complicated to administer and might be resisted by force.
On balance, I'd go for the jubilee, but I'll take Warren's version as a close second.
*There's also an extra 1% on wealth in excess of $1 billion, but this is largely symbolic.
Denis Drew , January 29, 2019 11:55 amSW , January 29, 2019 2:44 pm
Constitutional question about fed tax on wealth? ??? Apparently we can acquire pretty much the same 2% of wealth revenue from roughly the same people with an income tax surcharge of 20% on income above $50 million. Income tends to be pretty regularly 10% of wealth for this group. (graph provided)
"In 1999, billionaire Donald Trump proposed a "one-time" net worth tax of 14.25 percent on people worth $10 million or more to help pay off the national debt. He claimed it would raise $5.7 trillion "
https://www.usatoday.com/story/opinion/2018/07/31/trump-1999-wealth-tax-lower-deficits-reduce-inequality-column/826224002/Denis Drew , January 29, 2019 10:44 pm
Guess no one plays board games anymore. But there was a time when most people were familiar with the game Monopoly. And it is a pretty good teaching tool regarding end stage capitalism and extreme unequal distribution of wealth. At first the game is fun. Everyone has a grand time. But near the end of the game just a couple of people have all the property with hotels on everything. Every time you roll the dice, no matter where you land you have to pay one of those assholes. There is no escape and there is no doubt who is going to win. If you insist on keeping the game going you will have to spread the wealth around. Otherwise you will have to dump the whole board and start over.likbez , January 30, 2019 2:01 am
Maybe we could program an every loop redistribution tax (maybe every so many times around) to keep the game going almost forever. Guaranteed to get Democratic presidential candidates' endorsement. :-O
Those are funny ideas, if we think about who controls the government.
As neoliberal oligarchs are the real winners of each Presidential election theoretically it might be logical to have Election tax: a "wealthy tax" after each Presidential election.
Say, 10% for those who continued to the winner, and 5% for those who contributed to the loser, and 2.5% for whose who did not make any election contributions :-)
But, of course, this is just a dream...
Jan 29, 2019 | finance.yahoo.com
The Trump administration's $1.5 trillion in tax cuts appears to have not made any major impact on businesses' capital investment or hiring plans, according to a new survey.
A quarterly poll from the National Association for Business Economics published Monday found that some companies reported accelerating investments because of lower corporate taxes, but a whopping 84% of respondents said they had not changed their plans. That's up slightly from 81% in the previous survey published in October, Reuters reports.
The White House had said the massive stimulus package, which cut the corporate tax rate to 21% from 35%, would boost business spending and job growth. The tax cuts that came into effect in January 2018 were the biggest overhaul of the U.S. tax code in more than 30 years.
"A large majority of respondents, 84%, indicate that one year after its passage, the corporate tax reform has not caused their firms to change hiring or investment plans," NABE President Kevin Swift said in a release. "Fewer firms increased capital spending compared to the October survey responses, but the cutback appeared to be concentrated more in structures than in information and communication technology investments."
The lower tax rates did have an impact in the goods-producing sector, NABE found, with 50% of respondents reporting increased investments at their companies, and 20% saying they redirected hiring and investments to the US from abroad.
An analysis of how S&P 500 firms were reacting to the tax cut by researchers at the University of Michigan found that 4% of the sample said in Q1 of 2018 they would pay some of their tax savings back to workers, and 22% mentioned in earnings conference calls they would increase investment because of the tax cuts.
Though for small businesses, a new survey from the National Federation of Independent Business released earlier this month found 61% of owners reported making capital investments, unchanged from last month but 5 points higher than in August. In December, 35% of small-business owners reported increasing employee compensation and 24% reported planned increases in the next few months.
Jan 23, 2019 | finance.yahoo.com
Billionaire Michael Dell, chief executive officer of the eponymous technology giant, rejected a suggestion by U.S. Representative Alexandria Ocasio-Cortez of a 70-percent marginal tax rate on the wealthiest Americans.
"No, I'm not supportive of that," Dell said at a Davos panel on making digital globalization inclusive. "And I don't think it will help the growth of the U.S. economy. Name a country where that's worked."
She may not be in Davos, but the New York representative's influence is being felt on the slopes of the Swiss Alps. Three weeks after Ocasio-Cortez floated the idea in an interview on "60 Minutes" to raise the top marginal tax rate on Americans' income of more than $10 million to 70 percent, it was a hot topic at the gathering of the global financial and political elite.
... ... ...
"My wife and I set up a foundation about 20 years ago and we would've contributed quite a bit more than a 70 percent tax rate on my annual income," Dell said. "I feel much more comfortable with our ability as a private foundation to allocate those funds than I do giving them to the government."
Erik Brynjolfsson, a professor at the Massachusetts Institute of Technology who was on the panel with Dell, said such a rate worked in the U.S. after World War II. But other executives were opposed, including Salesforce.com Inc. Co-Chief Executive Officer Keith Block.
... ... ...
Billionaire investor Ray Dalio suggested that the idea may have legs in the run-up to the U.S. presidential election. Discussing the outlook for a slowing world economy Tuesday, Dalio said that next year will see "the beginning of thinking about politics and how that might affect economic policy beyond. Something like the talk of the 70 percent income tax, for example, will play a bigger role." He didn't mention Ocasio-Cortez by name.Currently in the U.S., the top marginal tax rate is 37 percent, which takes effect on income of more than $510,300 for individuals and $612,350 for married couples, according to the Tax Foundation.
The fortunes of a dozen attendees at the World Economic Forum in 2009 have soared by a combined $175 billion, a Bloomberg analysis found. The same cannot be said for people on the other end of the social spectrum: A report from Oxfam on Monday revealed that the poorest half of the world saw their wealth fall by 11 percent last year.
Jan 20, 2019 | economistsview.typepad.com
anne , January 17, 2019 at 05:12 AMhttp://cepr.net/blogs/beat-the-press/washington-post-forgets-to-mention-scott-walker-misled-fifth-graders-about-taxesRC AKA Darryl, Ron said in reply to anne... , January 17, 2019 at 05:49 AM
January 16, 2019
Washington Post Forgets to Mention, Scott Walker Misled Fifth Graders About Taxes
By Dean Baker
The Washington Post had an article * about how Republicans and right-wingers have become obsessed with trying to attack Alexandria Ocasio-Cortez, the newly elected representative from Brooklyn. At one point it refers to former Wisconsin governor Scott Walker's attack on Ocasio-Cortez's position advocating a high marginal tax rate on high income individuals.
"Former Wisconsin governor Scott Walker, a Republican who was defeated in November, on Tuesday mocked Ocasio-Cortez for her tax proposal and suggested it was an elementary-school understanding of the issue. 'Even 5th graders get it,' he tweeted."
While the piece noted part of Ocasio-Cortez's response, that rich people are the one's with the money, it left out the more important part, Walker misled the fifth graders he refers to in his tweet. In his tweet, Walker confuses a marginal tax rate with an average tax rate
"Explaining tax rates before Reagan to 5th graders: 'Imagine if you did chores for your grandma and she gave you $10. When you got home, your parents took $7 from you.' The students said: 'That's not fair!' Even 5th graders get it."
Ocasio-Cortez correctly pointed out in her reply that the $10 the students earned for doing chores for their grandma would not be taxed because the 70 percent tax rate she proposes would only apply to incomes above $10 million.
"Explaining marginal taxes to a far-right former Governor:
"Imagine if you did chores for abuela & she gave you $10. When you got home, you got to keep it, because it's only $10.
"Then we taxed the billionaire in town because he's making tons of money underpaying the townspeople."
Ocasio-Cortez is right on this point and Walker is wrong. He either does not understand how our income tax system works or is deliberately lying to advance his agenda. Either way, the Post should have pointed out that Walker was wrong.
Many people are confused about the concept of a marginal tax rate (the higher tax rate only appears to the income above a cutoff). Opponents of high marginal taxes on the rich try to take advantage of this confusion in the way Scott Walker did with his class of fifth graders. It is the media's responsibility to try to inform people about how the tax system works and to expose politicians who misrepresent the issue.
* https://www.washingtonpost.com/powerpost/what-have-you-got-left-ocasio-cortez-taunts-gop-critics-obsessing-over-her/2019/01/15/a48b5832-1455-11e9-803c-4ef28312c8b9_story.htmlThat's funny in a sad sort of way. Dean has his hands full. There is no explaining the stupidity of politicians, media, and ordinary people in the US these days.Darrell in Phoenix said in reply to anne... , January 17, 2019 at 07:39 AMThe whole Laffer Curve is based on this lie.Julio -> Darrell in Phoenix... , January 18, 2019 at 10:21 AM
100% tax, no economy, so no revenue.
0% tax, no revenue.
So, maximum revenue is somewhere between those.. and the 70% top rate is clearly above that.. so we have to lower the top rate.
Let's unwrap the lies.
1) At 100% top rate, there is no economy.
WRONG! Ignores brackets, marginal rates, deductions, effective rates... Even at 90% top rate, the rich were averaging 40% effective.
2) The goal of taxation is maximum revenue. NO!!! The tax code should be viewed as a tool to keep the right amount of money, actively circulating in the economy. As such, is not only about getting back out the money the government adds, but also about limiting how much the rich take out.
3) Even if we assumed there is some taxation rate that hurts the economy, there was no evidence presented to say we were above that point.
OF course, it is point #2 (limiting how much money the rich take from the economy) that the Laffer Curve was created to destroy. And destroy it did, which is why we've been going into debt at 3x the sustainable rate.Very good take on this discussion.Darrell in Phoenix said in reply to anne... , January 17, 2019 at 07:43 AM
I would add that there is plenty of historical evidence ("90% destroys all incentives!" "70% destroys all incentives!"..."39.5% destroys...") to conclude that the plutocrats believe that all taxation is theft.People on the left need to realize that high top rates are NOT to take money from the rich. They will spend or invest in ways that lets them avoid taxes.kurt -> Darrell in Phoenix... , January 17, 2019 at 01:07 PM
High top rates are needed to get the rich to spend and capital invest, to reverse the structural imbalances.
That spending and investing creates demand, jobs, wages, lifting the poor into the middle class.
The extra revenue comes from that growth in the middle class as the poor go from 0% effective rate to 10-15% effective rate.Agree - but it also changes the incentives for corporations and CEOs. By taxing away huge windfalls for CEOs it allows corporations to set a max wage around 15-20M. This means instead of the 700M to 1B salaries of big corps going to one guy, they pay their mid managers more and their line staff more. It means they invest more in R&D. I agree with you - just an supporting argument.
Jan 13, 2019 | finance.yahoo.com
Last year, these were the ten highest income tax states, according to TurboTax (*These rates do not include local taxes.):
New Jersey 8.97%
District of Columbia 8.95%
New York 8.82%
Jan 12, 2019 | www.nytimes.com
I have no idea how well Alexandria Ocasio-Cortez will perform as a member of Congress. But her election is already serving a valuable purpose. You see, the mere thought of having a young, articulate, telegenic nonwhite woman serve is driving many on the right mad -- and in their madness they're inadvertently revealing their true selves.
Some of the revelations are cultural: The hysteria over a video of AOC dancing in college says volumes, not about her, but about the hysterics. But in some ways the more important revelations are intellectual: The right's denunciation of AOC's "insane" policy ideas serves as a very good reminder of who is actually insane.
The controversy of the moment involves AOC's advocacy of a tax rate of 70-80 percent on very high incomes, which is obviously crazy, right? I mean, who thinks that makes sense? Only ignorant people like um, Peter Diamond, Nobel laureate in economics and arguably the world's leading expert on public finance. (Although Republicans blocked him from an appointment to the Federal Reserve Board with claims that he was unqualified . Really.) And it's a policy nobody has ever implemented, aside from the United States, for 35 years after World War II -- including the most successful period of economic growth in our history.
To be more specific, Diamond, in work with Emmanuel Saez -- one of our leading experts on inequality -- estimated the optimal top tax rate to be 73 percent. Some put it higher: Christina Romer, top macroeconomist and former head of President Obama's Council of Economic Advisers, estimates it at more than 80 percent .
Where do these numbers come from? Underlying the Diamond-Saez analysis are two propositions: Diminishing marginal utility and competitive markets.
Diminishing marginal utility is the common-sense notion that an extra dollar is worth a lot less in satisfaction to people with very high incomes than to those with low incomes. Give a family with an annual income of $20,000 an extra $1,000 and it will make a big difference to their lives. Give a guy who makes $1 million an extra thousand and he'll barely notice it.
What this implies for economic policy is that we shouldn't care what a policy does to the incomes of the very rich. A policy that makes the rich a bit poorer will affect only a handful of people, and will barely affect their life satisfaction, since they will still be able to buy whatever they want.
So why not tax them at 100 percent? The answer is that this would eliminate any incentive to do whatever it is they do to earn that much money, which would hurt the economy. In other words, tax policy toward the rich should have nothing to do with the interests of the rich, per se, but should only be concerned with how incentive effects change the behavior of the rich, and how this affects the rest of the population.
But here's where competitive markets come in. In a perfectly competitive economy, with no monopoly power or other distortions -- which is the kind of economy conservatives want us to believe we have -- everyone gets paid his or her marginal product. That is, if you get paid $1000 an hour, it's because each extra hour you work adds $1000 worth to the economy's output.
In that case, however, why do we care how hard the rich work? If a rich man works an extra hour, adding $1000 to the economy, but gets paid $1000 for his efforts, the combined income of everyone else doesn't change, does it? Ah, but it does -- because he pays taxes on that extra $1000. So the social benefit from getting high-income individuals to work a bit harder is the tax revenue generated by that extra effort -- and conversely the cost of their working less is the reduction in the taxes they pay.
Or to put it a bit more succinctly, when taxing the rich, all we should care about is how much revenue we raise. The optimal tax rate on people with very high incomes is the rate that raises the maximum possible revenue.
And that's something we can estimate, given evidence on how responsive the pre-tax income of the wealthy actually is to tax rates. As I said, Diamond and Saez put the optimal rate at 73 percent, Romer at over 80 percent -- which is consistent with what AOC said.
An aside: What if we take into account the reality that markets aren't perfectly competitive, that there's a lot of monopoly power out there? The answer is that this almost surely makes the case for even higher tax rates, since high-income people presumably get a lot of those monopoly rents.
So AOC, far from showing her craziness, is fully in line with serious economic research. (I hear that she's been talking to some very good economists.) Her critics, on the other hand, do indeed have crazy policy ideas -- and tax policy is at the heart of the crazy.
You see, Republicans almost universally advocate low taxes on the wealthy, based on the claim that tax cuts at the top will have huge beneficial effects on the economy. This claim rests on research by well, nobody. There isn't any body of serious work supporting G.O.P. tax ideas, because the evidence is overwhelmingly against those ideas.
Look at the history of top marginal income tax rates (left) versus growth in real GDP per capita (right, measured over 10 years, to smooth out short-run fluctuations.): Top tax rates and growth Credit Tax Policy Center, BEA
What we see is that America used to have very high tax rates on the rich -- higher even than those AOC is proposing -- and did just fine. Since then tax rates have come way down, and if anything the economy has done less well.
Why do Republicans adhere to a tax theory that has no support from nonpartisan economists and is refuted by all available data? Well, ask who benefits from low taxes on the rich, and it's obvious.
And because the party's coffers demand adherence to nonsense economics, the party prefers "economists" who are obvious frauds and can't even fake their numbers effectively.
Which brings me back to AOC, and the constant effort to portray her as flaky and ignorant. Well, on the tax issue she's just saying what good economists say; and she definitely knows more economics than almost everyone in the G.O.P. caucus, not least because she doesn't "know" things that aren't true. Related Opinion | Maureen Dowd Boogie Down, Bronx Girl The fiery class of freshmen dance their way onto the House floor. But will they overstep? Jan. 5, 2019
Follow The New York Times Opinion section on Facebook , Twitter (@NYTopinion) and Instagram , and sign up for the Opinion Today newsletter . Paul Krugman has been an Opinion columnist since 2000 and is also a Distinguished Professor at the City University of New York Graduate Center. He won the 2008 Nobel Memorial Prize in Economic Sciences for his work on international trade and economic geography. @ PaulKrugman
Howard Columbus, Ohio Jan. 7 Times PickMW OH Jan. 7 Times Pick
Billy, if AOC's proposal is insane, than Dwight Eisenhower, President during a long period of economic expansion and prosperity, belonged not in the White House but in a mad house, given that the top income tax rate during his administration, 91%, exceeded even that suggested by AOC. I have lifelong friends in Denmark and have visited the country. All say they are happy with the high personal income tax rate, which was 55.8 % in 2018 . See https://tradingeconomics.com/denmark/personal-income-tax-rate . Interestingly, the main indicators of happiness find that Denmark is also the happiest country in the world ( https://www.frugalconfessions.com/miscellaneous/denmark-highest-tax-rate-and-happiest-people.php ).Mjxs Springfield, VA Jan. 7 Times Pick
Whatever one makes of AOC's tax ideas (they're good) or PK's take on them, the frenzy that AOC has sparked is quite a sight to behold.
This is how people shape the conversation, and it's how the Dems can reclaim a share of the news media spotlight.
Conservatives have known this is how it works for a long time: it pays to have a few extremists willing to utter ideas from the fringe. The media will cover AOC because it's AOC saying things. Period. Over time, with persistence and if she and others like her have substance and discipline (still not certain), she will help move the window of opportunity to the left.
She will help normalize what until recently was regarded as 'zany lefty'. This clearly freaks out conservative operators and it will be one of AOC's biggest contributions. Her strength will be to make everyone talk about her and her ideas.
Her haters commenting here are proving the point. Finally, a Dem who knows to steer clear of the 51-point policy plan that oh-so-cleverly tweaks the tax code here and balances the wishes of everyone/no one and instead just make a bold ambitious claim. Good for her.Jason Seattle Jan. 7 Times Pick
In Manchester's "The Power and the Glory" he noted that in 1950, the CEO of Ford Motors lived in a relatively modest five-bedroom home in Detroit: "when the doorbell rang, he answered himself." So did the Vice President of the United States. Their children were drafted.
These men were no less smart, savvy, and entrepreneurial than today. They were comfortable, had homes in the Hamptons (not mansions) and still led the United States in the greatest economic expansion in history.
When did we begin to believe that mega-millions to CEOs will magically transform into wealth for all, or that it is a necessary inducement to work? A man who makes millions will reinvest in his country; a man who makes hundreds of millions will hide it offshore, Restore the marginal tax rate to the 1960 level. And restore the draft. It's America, dammit, and everybody pulls an oar.Corwin New York Jan. 7 Times Pick
I'm baffled by the rationale here. The liberals certainly understand that it's 2019 and people and capital are more mobile than they've ever been. I own a business - tax me at 73% and watch me take it to Canada, Ireland, or any other locale where I don't get "soaked".
Why is the answer from the left that we always need more money from someone? As if the "rich" have done something wrong. Why not take the existing bloated budget, apply some creativity and critical thinking (you know - the kind that happens in the private sector) and solve problems with the current tax rates.Freda Pine San Francisco Jan. 7 Times Pick
@Freda Pine When you're making over $10 million, you're not getting out of bed and clocking into the warehouse to earn your money. Your interest are diverse and generate money without your lifting a finger. There is no faucet of income to turn off, and even if you could, why would you? It's still a lot of extra income for the type of person who is interested in earning more money than they can possibly spend.tommag1 Cary, NC Jan. 7 Times Pick
Economists are not physiologists. I will not get out of bed if I had to pay 70% tax on my income. Not even if my income was $300,000 annually. I might as well work less hard and earn $100,000 paying $20% tax. This tax worked in the past, but since a lot has changed in our society. We are far from Scandinavia and any effort to impose a move in it's direction is unproductive.
Ask most older white Americans what was the best time economically in this country and they will say the post WWII and the Eisenhower years. Then remind them of the top tax rates and the lack of deductions.
Jan 12, 2019 | economistsview.typepad.com
Darrell in Phoenix said in reply to anne... , January 08, 2019 at 04:24 PMI think this is still the wrong tack, as it gets too close to the wrong headed Modern Money Theory where the ignorant think money can be dumped into the economy, in near infinite amounts, without regard for taxation, with no side-effects.mulp -> Darrell in Phoenix... , January 09, 2019 at 05:34 AM
I think the better tack is to attack it as a cash-flow issue. The rich are taking money out of active circulation, and lending it back into the economy. This is why debt is exploding at an unsustainable rate.
We need to use the tax code to force the rich to spend or capital invest their income back into the economy.
Observations of the 1950-1960s tax code show that the rich didn't actually pay a higher effective rate. They used loopholes.
RIGHT!!! Those loopholes were created as the carrot to get the rich to spend or invest.
Don't phrase it as "We need to raise taxes to fund..." It smacks of "take from workers and give to lazy".
We need to phrase it as "We need to tax to force the rich to spend or invest."
The spending and investing increases total economic activity. The poor become middle class, going from paying little-to-no tax to paying 20-30% effective rates.
AND, it is that lifting of the poor into the middle class that creates the extra tax revenue to fund needed social and infrastructure spending.You are on the right track.Darrell in Phoenix said in reply to mulp ... , January 09, 2019 at 09:20 AM
The solution is to put the Federal government on GAAP bookkeeping. An income and expense ledger. And asset and liabilty ledger.
State and local government sorta do this, ie, they balance income and expense except for capital expense funded with bonds.
What is not done is the listing of all assets offset by debt, etc, and shareholder equity.
For NYC vs smallville KS, the liabilities of NYC would be tens of billions and svKS zero, but the assets of NYC multiples of liabilities vs a few thousand in asset value for that debt free small town.
Given Adam Smith, the assets of a government should include its people as they are the biggest wealth "of nations". The better educated, skilled, more productive, substantially derermined by investing in education, health, etc, the greater the asset value, the greater the wealth.
But just limiting debt to bonds tied to new assets, bonds for roads, schools, etc. Taxing the assets to pay off the bonds while taxing the people for current consumption is prudent.Is it "track" or "tack"?
My take is:
Track refers to trains or roads, meaning one of limited options.
Tack is a sailing term used to describe how you get a sailboat to go upwind by not going directly in the direction you want, but rather at an angle.
I am concerned with the money supply.
Currently, 10% of GDP leaks out via structural imbalances, replaced by debt increasing at 3x the rate of population(1%ish) and inflation(2%ish).
The OP Krugman tacks the tack (or is it track, becasue of limited options?) that we should just keep doing that. He is saying we should ignore the massive deficits, and wealth transfer to the rich that the interest on that debt creates.
I believe this the wrong tack (or is it track?), instead thinking we should attack and reverse the trade imbalances such that the debt is no longer necessary.
You are still misunderstand the problem, viewing the macroeconomy through a microeconomic lens.
You want the federal government to start acting "responsible", ignoring the lessons of the 1800s that the rich would soon suck all the money out of the economy, creating a depression.
You get blood out of a turnip by first putting blood into a turnip.
You get money out of an economy (as the trade does $500+B a year and the rich are doing $1T+ a year) but first putting money in ($1.5T+ new debt a year).
You think we can stop putting blood into the turnip... I mean stop putting money into the economy, without first stopping the giant drain of blood... dang it... I mean money out of the economy.
In reality, there appear to be 2 options. 1) Keep putting money in and taking it out. 2) Stop taking it out so that we can stop putting it in.
Your option of "just stop putting money in, without first addressing the drains" is sure to lead to collapse.
Jan 12, 2019 | myaccount.nytimes.com
Barking Doggerel America Jan. 5
I have long been humored by the absurd idea that the wealth accumulated by "entrepreneurs" and businessmen is hard earned. I made a pretty decent living and, while experiencing some added stress with more responsibility, I worked less hard as I became more successful.
Sure, I had experience and judgment that helped, but mostly I won the game that is played in most businesses and organizations.
Being white helps a lot. Being male helps a whole bunch. Knowing certain social conventions and being reasonably well educated was useful. The very wealthy folks I have known, and there have been many, have more leisure time, more freedom to manage their own personal affairs and less stress from being at the mercy of others.
And the very wealthy I've known are not smarter, more creative or virtuous than the folks who work for them or for other wealthy executives. It's all a complex social sorting based primarily on several kinds of privilege combined with aggression in many cases.
America's greatest myth is that people deserve what they get and get what they deserve. That is why progressive taxation and civic generosity is the only way to craft a truly civil society.
Ron Cohen Waltham, MA Jan. 5SJP Europe Jan. 5
When top rates were high, 70-80 percent, executive salaries were lower, much lower. Why? Companies saw that if they raised executive salaries they would simply be shoveling most of that extra money to the government. They thought they had better uses for it, such as capital investment and better pay for workers. This is yet another way, an indirect way, in which low top rates encourage economic inequality, the bane of our society, today.hammond San Francisco Jan. 5
If high taxes on the rich really were a problem, how is it possible then that the economies of Scandinavia and Europe are doing so well? I'd also like to add that the best way to add revenue to the government, is to fund the IRS: it busts cheaters, and it enforces compliance of those who may be tempted to cheat. When, after the Panama and UBS leaks, a few big cases of tax fraud were brought to justice in Europe (some well-known VIPs even went to prison), there suddenly was a wave of rich people voluntarily declaring hidden assists and gladly paying penalties, for fear of being busted in another set of leaks, sent to prison and/or be publicly shamed.Socrates Downtown Verona. NJ Jan. 5
Although I agree with Mr. Krugman's argument and I'm a big fan of AOC and the other fresh young voices in the House, I think the graph presented in the middle of this article is misleading. While it's true that we had tremendous growth during a period of very high taxes, one should not draw the conclusion that the high taxes promoted vigorous growth. That period of high taxes occurred when the US manufacturing sector was supercharged by the war effort, and Japan and Europe lay in ruins. It's entirely possible that growth might have been even stronger with lower tax rates. That said, as a wealthy person I fundamentally agree that paying higher taxes will not affect my personal economics in any materially meaningful way. Sure, some wealthy people might leave the US for cheaper lands; people whose principal goal in life is to have the highest score in the video game of finance. Most of the rest of us will continue to enjoy living in this country, and likely take advantage of an improved infrastructure, a more educated workforce, clean air and water, and pristine wilderness areas.Plennie Wingo Weinfelden, Switzerland Jan. 5
To anyone who thinks that the Republican Party knows a thing about economics or business: you're delusional. Republicans know a tremendous amount about greed, theft and selfishness. Arthur Laffer is the idiotic tax-cut patron saint economist of the Grand Old Phonies who helped Ronnie Reagan raid the US Treasury for the uber-wealthy.
George W Bush re-implemented Laffer-economics and drove the nation into a Depression.
Trump and the GOP are in the process of driving America over another bankrupting 0.1% welfare tax-cut cliff -- remember it took Bush-Cheney a good seven years to do it.
And guess who recently helped drive Kansas bankrupt with tax cuts for the rich ?
GOP tax-cut saint Arthur Laffer. He helped former Kansas Gov. Sam Brownback (R) pass tax cuts through the Kansas legislature. In August 2012, Laffer promised a crowd at a small business forum in Kansas that the cuts would produce "enormous prosperity," adding that they'll "make a big difference in a decade." They did make a big difference.
Kansas employment and the Kansas state economy both grew slower than the national rates, and the drastic decline in tax revenue coming into the state's treasury blew a gigantic hole in its budget.
Kansas reversed the destructive tax cuts in order save Kansas. The lesson is plain and simple and happens over and over again. Republicans are economic wrecking balls hellbent on destroying society for corrupt billionaires. D to go forward. R for nationally-assisted suicide.Rima Regas Southern California Jan. 5
These top rates almost never apply to the rich anyway who almost always are paying the capital gains rate rather than that on ordinary income. It is much like the rates on corporations -- they never pay anything near that amount. Only those working for wages pay top dollar. A huge scandal.Mjxs Springfield, VA Jan. 7 Times Pick
@OCA is going to show these resentful old white patriarch and their female enablers what well-adjusted women are like and what self-respect does not only for ones soul, but in righting the wrongs for a new generation of Americans. It's about time, too! @OCA has vision, imagination, compassion, and self-love. We're being robbed by a bunch of entitled two-bit crooks.
It'll take raising corporate taxes to Clinton levels or higher, not only to recover from Trump, the Bush recession and the then middle aged workers who never got back on track, but also to prepare for the new automated economy in the next 20 years.
We need more Ocadio-Cortezes in office and I look forward to electing a progressive majority in 2020. --- Things Trump Did While You Weren't Looking  https://wp.me/p2KJ3H-3h2Red Sox, '04, '07, '13, '18, Boston Jan. 5
In Manchester's "The Power and the Glory" he noted that in 1950, the CEO of Ford Motors lived in a relatively modest five-bedroom home in Detroit: "when the doorbell rang, he answered himself." So did the Vice President of the United States. Their children were drafted. These men were no less smart, savvy, and entrepreneurial than today. They were comfortable, had homes in the Hamptons (not mansions) and still led the United States in the greatest economic expansion in history. When did we begin to believe that mega-millions to CEOs will magically transform into wealth for all, or that it is a necessary inducement to work?
A man who makes millions will reinvest in his country; a man who makes hundreds of millions will hide it offshore, Restore the marginal tax rate to the 1960 level. And restore the draft. It's America, dammit, and everybody pulls an oar.Zejee Bronx Jan. 5
Well, this is refreshing. The tax rate, once 90% of rich people's income, now sits at 150% from where it once as, during America's halcyon days of growth and incentive. In other words, the rich were put to work for the rest of us. And why not? But it took a healthy dive, from 70% to less than half that under Reagan (trickle-down, anyone?). The graph is most revealing in that growth rate dropped like a stone (under Reagan) as did the corresponding top tax rate. Coincidence? Hardly. So Alexandria Ocasio-Cortez comes along and has the idea that the wealthy will never (all things considered equal) lack for money. So, the Right's question is this: "why should the rich work for the poor?" The answer is that they live in the same world that we do, and the labor and the tax rate for the less-than-rich allow the rich to utilize the same benefits the rest of us do. It's been a Republican meme, and will, I fear, always be one, but the cry of "Socialism" and "wealth re-distribution" are as potent on the right as anything racist or nationalist or xenophobic that Trump or McConnell or Ryan or anyone of their ilk could dream up. Simply put, Republicans do not consider those without wealth worth the trouble, the time, the patience, or the courtesy of invested citizenship. Instead, they re-direct their anger towards voting rights and unfunded schools and unlimited political donations. They now own the Supreme Court, the executive and half of Congress. I wish Ms. Ocasio-Cortez well.NR New York Jan. 5
Eisenhower's tax rates on the rich were higher. Americans prospered.Bruce Rozenblit Kansas City, MO Jan. 5
My spouse and I have a very nice life, probably in the top four-tenths of the one percent in terms of assets (primarily illiquid) and somewhat wealthy with a combined mid-six-figure annual salary income. I gave away 25 percent of my salary this year because I was so disgusted by the impact of the Trump tax bill. I will probably do the same in 2019. Some of the money I gave did not go to nonprofits, but directly to very hard-working people whose incomes do not cover housing, food, health care, transportation, and utilities. Basics. For God's sake, Republicans, get with the program, And Democrats, you too. My spouse and I, even though we live in a high-tax state, should be paying more taxes. Our systems rot from the inside out. I see it in both parties, and I see it at the local, state, and federal level. And this greed is unique to one group. I see it in privileged whites and I also see it in minorities.Antoine Taos, NM Jan. 5
This is an excellent analysis. Let's look at the issue from a non monetary stance. The prime mover here is not wealth, but power, political power. These ultra rich want to run the show. Think about that.
If you have so much money that you can buy anything you want, what else is there to grasp beyond material possessions? Power. The low tax rates are intended to establish a wealth aristocracy, a type of moneyed royalty who control society. Coupled with that is the elimination of the estate tax. This allows the ultra rich to set up dynasties, like royal lines of succession, to have their legacies continue. It's like a stab at immortality.
To top off the entire royalty thing, much of their wealth was most likely generated from tax breaks, tax giveaways, tax shelters and the like. Odds are that a substantial portion of their wealth was never taxed to begin with and with the loss of the estate tax, they get to will it to their heirs tax free. This wealth aristocracy is the prime mover of Republican politics. Everything they do from judges to legislation is targeted to bolstering this wealth aristocracy. The real tragedy here is they convinced the coal miners and factory workers that doing this is a great idea.MAS MA Jan. 5
This needed to be said and you said it well. The nonexistent link between higher taxes and lower growth has to be exposed. Tax policy based on that falsehood only serves to make the wealthy wealthier. It also serves to create a class of offsprings who are also extremely wealth without having worked for a nickel of that wealth. This can't be good economic or social policy.Steel Magnolia Atlanta Jan. 6
@WPLMMT That is not what she is proposing. The 70% is the marginal tax rate, applied only to the very highest portion of incomes, like over 10 million. Do just a little research before criticizing.Andy Salt Lake City, Utah Jan. 5
I do not understand the donor class -- those in the top tenth of the top one percent who give millions to GOP congresspeople in expectation of massive tax cuts. According to CBS reporting they pull in an average annual income of $35 million and belong to a cohort of billionaires whose combined net worth approximates that of the rest of us put together. They have everything they need, everything they could ever want. Yet very little of their income goes back into the economy to "trickle down."
Typically the majority goes to investment, often offshored for tax advantage. And big tax-deductible blocks go to "charities" like the Heritage Foundation which stocks the courts with partisan judges who mould the law in their favor or like conservative publications or think tanks which help mould public opinion in their favor. They spend millions to get their tax cuts, to mould the courts and public opinion, for the best accountants and tax lawyers money can buy. All to maximize incomes so large the marginal utility of additional millions is, well, marginal.
And all to keep absolutely as little as possible from going to public health, public education, public security, any public use whatsoever. It is not so much that more is never enough. The bigger question is why they spend so much to avoid contributing money of so little marginal value to them to the commonweal. Whatever happened to noblesse oblige? To "For to whom much is given, much is required"?Matthew Carnicelli Brooklyn, NY Jan. 5
I didn't know Nobel prize winning economists needed to defend Ocasio-Cortez. I used to teach marginal utility and marginal product to kids fresh out of high school. You don't need a doctorate to understand the fundamental mechanics of economic theory. The only people who believe in Republican economic doctrine are people who are paid to believe and people who are paid don't care whether the doctrine is accurate. George H.W. called it from the start. Voodoo economics defies basic arithmetic. How 40 years worth of voters forgot common sense is beyond me.Marc Boston,MA Jan. 6
Paul, the United States has conducted a continual experiment in radical inequality ever since Reagan entered the White House. This experiment has largely continued regardless of whether a Democrat or Republican has sat in the Oval Office. IMHO, the results are in - and they demonstrate that America is not a happier country when CEOs make roughly 300 times amount of their lowest paid employees, and when the ultra rich can easily shift the money that they're not paying in taxes to federal and state governments into off-shore havens or emerging market economies.
I submit that our exploding budget deficit is a testament to how this policy has failed fiscally - and that our loss of national comity is a testament to how this policy has failed politically. It's time for a new experiment, an experiment in bubble-up economics - an economics for the rest of us, a capitalism with a human face, a mixed economy where individual effort is rewarded, but within which no one who truly tries to keep up is left behind.jrinsc South Carolina Jan. 5
Judging from many of the comments posted here what is needed to improve tax policy in the US is education. If so many of us can't follow the simple analysis Professor Krugman offers how will we ever get past the bogus claims and do the right thing?hammond San Francisco Jan. 5
The graph is telling. I don't recall rich people in the late 50s and early 60s as being destitute because of tax rates; they seemed to do just fine. But now Jeff Bezos earns roughly $6,000,000 per hour, while Amazon warehouse workers start at $11 per hour. Is Bezos's personal marginal product really worth 545,455% more than his warehouse employees?
And what is his ACTUAL tax rate, given all the many deduction open to the super wealthy that someone making $11 per hour doesn't have available? The great irony of the graph is that MAGA hearkens back to post WWII America, a time when the richest among us had a 90% tax rate and far fewer deductions, and unions helped lower to middle class workers get livable wages and a pension.MW OH Jan. 7 Times Pick
@Kenneth Johnson How many wealthy people left the US in the 50's and 60's, when the tax rate was so high? It's a reasonable hypothesis: most wealthy people will leave the US if the tax rate goes too high. But what actual evidence is there to support it? I'm a very wealthy person, have constantly voted to increase my tax rate, live in the one of the highest taxed states in the union, and I have no plans to leave. Like the professor wrote, paying more taxes will not affect my material life in the least. So why would I leave?priceofcivilization Houston Jan. 6
Whatever one makes of AOC's tax ideas (they're good) or PK's take on them, the frenzy that AOC has sparked is quite a sight to behold. This is how people shape the conversation, and it's how the Dems can reclaim a share of the news media spotlight. Conservatives have known this is how it works for a long time: it pays to have a few extremists willing to utter ideas from the fringe. The media will cover AOC because it's AOC saying things. Period. Over time, with persistence and if she and others like her have substance and discipline (still not certain), she will help move the window of opportunity to the left. She will help normalize what until recently was regarded as 'zany lefty'. This clearly freaks out conservative operators and it will be one of AOC's biggest contributions. Her strength will be to make everyone talk about her and her ideas. Her haters commenting here are proving the point. Finally, a Dem who knows to steer clear of the 51-point policy plan that oh-so-cleverly tweaks the tax code here and balances the wishes of everyone/no one and instead just make a bold ambitious claim. Good for her.tommag1 Cary, NC Jan. 7 Times Pick
The most important thing is to make clear that this rate is for a new bracket. It only applies to people who make more than $10 million dollars a year, and only applies to the income over the first $10 million. Once that is understood, most people would support a top rate of 73 percent, or even Eisenhower's 90 percent. We need a transformation to common sense, ethics, and the public good. The lies of Republican economics, or greed is good, has led us to the brink of plutocracy and oligarchy...Anthony Flack New Zealand Jan. 6
Ask most older white Americans what was the best time economically in this country and they will say the post WWII and the Eisenhower years. Then remind them of the top tax rates and the lack of deductions.Prometheus Caucasus Mountains Jan. 6
@Gwe - I don't believe that people with the competency to run a company are so rare, and their skills so exceptional, that you need to pay them millions of dollars to have any hope of attracting one of these management unicorns. I think they definitely would LIKE people to believe that. But there are plenty of examples of incompetent CEOs doing a terrible job, and they still get paid millions.Bascom Hill Bay Area Jan. 5
There is also an economic theory out there, I can't remember its name, but I call it the Ferrari theory. It goes like this: these men/women..."Masters of the Universe" are so smart, so talented at generating $$, so in love with $$ that taxing them too little is like driving a Ferrari at very low RPM; Ferraris are optimal and made for high RPMs. Well, this applies to some people too. If you have some employees that are workhorses, you work them; you do NOT lessen the proportion of their work, you increase it because they can do it. If these rich people are so smart, so talented and so in love with $$, the society needs to optimize their tax output for the betterment of society. They'll only work harder to make more money. The Tax code today pampers them like they are incompetent and is the central cause of inequality never seen before in history. N.B., Atlas is not going to ShrugHoward Columbus, Ohio Jan. 7 Times Pick
When George Romney was a CEO in Detroit, his $compensation was about 80X the median income. (Today's CEOs are at 300X) And his tax rate, as shown when he ran for president, was about 40%. Wasn't Mitt's tax rate under 15% when he released his tax records.romanette Decatur, Ga Jan. 7
Billy, if AOC's proposal is insane, than Dwight Eisenhower, President during a long period of economic expansion and prosperity, belonged not in the White House but in a mad house, given that the top income tax rate during his administration, 91%, exceeded even that suggested by AOC. I have lifelong friends in Denmark and have visited the country. All say they are happy with the high personal income tax rate, which was 55.8 % in 2018 . See https://tradingeconomics.com/denmark/personal-income-tax-rate . Interestingly, the main indicators of happiness find that Denmark is also the happiest country in the world ( https://www.frugalconfessions.com/miscellaneous/denmark-highest-tax-rate-and-happiest-people.php ).Pat NYC Jan. 5
@Jason So take your lemonade stand to Canada, see if they're willing to pay $4 a cup. You're here because the market is here and, in some cases, because the employees you need are here. So suck it up and contribute your fair share. Current tax rates are a complete sham, fiscal stimulus at the top of the business cycle, benefiting only the rich. This is when we need to be reducing debt and saving for the lean times.Corwin New York Jan. 7 Times Pick
"She definitely knows more economics than almost everyone in the G.O.P. caucus, not least because she doesn't "know" things that aren't true. This sums up the GOP. They've created their own alternate reality where facts and history do not exist. I hope AOC does very well for her district and the country. We need fact based leadership and in that regard she already outshines dump and co.Michael Evans-Layng, PhD San Diego Jan. 5
@Freda Pine When you're making over $10 million, you're not getting out of bed and clocking into the warehouse to earn your money. Your interest are diverse and generate money without your lifting a finger. There is no faucet of income to turn off, and even if you could, why would you? It's still a lot of extra income for the type of person who is interested in earning more money than they can possibly spend.revelever Atlanta Jan. 6
I appreciate your comment and the reminder that correlation is not causation. I'm puzzled as to why it's not a "pick." Anyway, I saw the graph differently. Not so much that high taxes on the wealthiest promote growth as that high taxes do not prevent growth, which is the Republican cant. That is, high taxes on the wealthy and solid economic performance can coexist just fine, thankyouverymuch. I also appreciated your first-hand validation of Dr. Krugman's point about marginal utility.Will. NYCNYC Jan. 5
@Geoffrey I don't think people necessarily deserve what they get. Progressive taxation is an attempt to compensate for imbalances in distribution of wealth, not an attempt to steal from the wealthy. Who is to say what is fair you ask? That is what democracy is for. A civil society can't tolerate the gigantic pay imbalances we see today. It's gotten out of control, it's messing with the cohesion that we need to survive, and something has to be done. If not taxation, what.Dap Pasadena, CA Jan. 5
@Ron Cohen The most insightful comment so far. And one that none other than Mitt Romney's father, George Romney, would agree whole heartedly.Thomas Zaslavsky Binghamton, N.Y. Jan. 5
President Reagan was at least honest. He dropped the high income tax rates by about a factor of 2 and then made all income sources equal, e. g., no special low tax rates for capital gains. The rich accepted the new, low tax rates on income, and then worked feverishly to regain their perks, including preferential treatment of capital gains. They have had their cakes and have been eating them too. Not exactly fair.Suresh Karathinnai DC Jan. 6
@Gwe Your opinion, in my opinion (!), has a few faults. The good CEO types don't grow on trees. That's one reason so many CEO's are not good. But they get paid lavishly all the same. You are talking only about the achievement, academic and economic, of the ones who are making a lot of money. How about the ones with equal achievement that doesn't result in a lot of money? Why do they deserve less? I suggest that one reason is that they aren't the ones deciding on the flow of money. When someone joins that crowd, they are likely to be well taken care of. A high marginal tax rate won't push anyone down severely. It will stop some of the self-indulgence of people who believe they are entitled to self-indulgence at the expense of 95-99% of the people. They will have to readjust their standards, and it won't be a disaster.common sense advocate CT Jan. 6
Dr. Krugman, you are being - dare I say it - a little Disingenuous - here. You make it sound like the criticisms of AOC are based only on her dancing video and her views on the top marginal rates. That is not the case. Her dancing is of course personal business and it is is silly on the right to go after this. And her views on the top rates could perhaps be justified as you have done. But she has displayed appalling ignorance of economics and even worse evidence of innumeracy. First she said that the unemployment rate was low because many people work a second and third job. Surely, you will be first person to acknowledge that this is blather? This may forgivable if it came from an English or History major. Ms. Dowd informs us that AOC is an econ major. And then there was the nonsense about the 21 trillion dollar mistake that the Pentagon made which will be enough to pay for healthcare for all and a host of other programs. This is worse than ignorance of economics. It is evidence of poor reasoning and innumeracy (all that she needed to do was to look at the size of US GDP to know that 21 trillion dollar income release from an accounting error is a ridiculous idea). She displays the tendency to speak first and think later.
Would you accept this level of ignorance and innumeracy in Mr. Ryan or President Bush or Mr. Gingrich? She has the right instincts for the most part. But it is not OK to play the "our ignoramus is fine, but theirs is a wingnut" game.
I'd like to call out the video for a moment - in a country where a full half of college students don't graduate from college on time - and in a country plagued by opioid abuse - and in a country where #metoo was started because of harassment and sexual violence - and in a country with a president elected by people who deny gender and racial equality - watching a bunch of clean cut, lighthearted, happy, talented young women and men dancing was a breath of cool, fresh air.
Jan 01, 2019 | economistsview.typepad.com
January 1, 2019
The Trump Tax Cut: Even Worse Than You've Heard
Skeptical reporting has still been too favorable.
By Paul Krugman
The 2017 tax cut has received pretty bad press, and rightly so. Its proponents made big promises about soaring investment and wages, and also assured everyone that it would pay for itself; none of that has happened.
Yet coverage actually hasn't been negative enough. The story you mostly read runs something like this: The tax cut has caused corporations to bring some money home, but they've used it for stock buybacks rather than to raise wages, and the boost to growth has been modest. That doesn't sound great, but it's still better than the reality: No money has, in fact, been brought home, and the tax cut has probably reduced national income. Indeed, at least 90 percent of Americans will end up poorer thanks to that cut.
Let me explain each point in turn.
First, when people say that U.S. corporations have "brought money home" they're referring to dividends overseas subsidiaries have paid to their parent corporations. These did indeed surge briefly in 2018, as the tax law made it advantageous to transfer some assets from the books of those subsidiaries to the home companies; these transactions also showed up as a reduction in the measured stake of the parents in the subsidiaries, i.e., as negative direct investment (Figure 1).
Figure 1 *
But these transactions are simply rearrangements of companies' books for tax purposes; they don't necessarily correspond to anything real. Suppose that Multinational Megacorp USA decides to have its subsidiary, Multinational Mega Ireland, transfer some assets to the home company. This will produce the kind of simultaneous and opposite movement in dividends and direct investment you see in Figure 1. But the company's overall balance sheet – which always included the assets of MM Ireland – hasn't changed at all. No real resources have been transferred; MM USA has neither gained nor lost the ability to invest here.
If you want to know whether investable funds are really being transferred to the U.S., you need to look at the overall balance on financial account – or, what should be the same (and is more accurately measured), the inverse of the balance on current account. Figure 2 shows that balance as a share of GDP – and as you can see, basically nothing has happened.
So the tax cut induced some accounting maneuvers, but did nothing to promote capital flows to America.
The tax cut did, however, have one important international effect: We're now paying more money to foreigners.
Bear in mind that the one clear, overwhelming result of the tax cut is a big break for corporations: Federal tax receipts on corporate income have plunged (Figure 3).
The key point to realize is that in today's globalized corporate system, a lot of any country's corporate sector, our own very much included, is actually owned by foreigners, either directly because corporations here are foreign subsidiaries, or indirectly because foreigners own American stocks. Indeed, roughly a third of U.S. corporate profits basically flow to foreign nationals – which means that a third of the tax cut flowed abroad, rather than staying at home. This probably outweighs any positive effect on GDP growth. So the tax cut probably made America poorer, not richer.
And it certainly made most Americans poorer. While 2/3 of the corporate tax cut may have gone to U.S. residents, 84 percent ** of stocks are held by the wealthiest 10 percent of the population. Everyone else will see hardly any benefit.
Meanwhile, since the tax cut isn't paying for itself, it will eventually have to be paid for some other way – either by raising other taxes, or by cutting spending on programs people value. The cost of these hikes or cuts will be much less concentrated on the top 10 percent than the benefit of the original tax cut. So it's a near-certainty that the vast majority of Americans will be worse off thanks to Trump's only major legislative success.
As I said, even the mainly negative reporting doesn't convey how bad a deal this whole thing is turning out to be.
** https://www.nytimes.com/2018/02/08/business/economy/stocks-economy.html Reply Monday, January 07, 2019 at 02:31 PM
anne -> anne... , January 07, 2019 at 02:42 PMhttps://www.nytimes.com/2019/01/01/opinion/the-trump-tax-cut-even-worse-than-youve-heard.html
January 1, 2019
The Trump Tax Cut: Even Worse Than You've Heard
Skeptical reporting has still been too favorable.
By Paul Krugman
January 30, 2019
- Balance on Current Account as a share of Gross Domestic Product, 2000-2018
January 30, 2019
Federal Government Tax Receipts from Corporate Income, 2012-2018
January 30, 2019
Federal Government Tax Receipts from Corporate Income, 2012-2018
(Indexed to 2012)
Jul 06, 2018 | www.nytimes.com
Yankelnevich Denver July 1
The reduction in corporate taxes from 440 billion to 280 billion is a staggering reduction in tax liability. Corporations tend to be very rational actors. They want to maximize the value of their firms and long term shareholder wealth. Corporate leaders, given this windfall, which should be 1.6 trillion or more over the next ten years can
1. return the wealth to shareholders who then can make their own decisions about the money
2. invest in personnel, capital equipment or other factors related to production. A sales organization may want to increase the sales force, a research organization might want to hire new researchers or they might invest in software or other information technologies to increase productivity.
3. build their balance sheets for various strategic purposes
4. borrow money with the new capital formation from the tax reduction, i.e. combine equity with new debt or recapitalize their institutions for strategic reasons and or shareholder liquidity.
5. They can grow their companies through strategic acquisitions enabled by the new money.
6. They can grow organically using the new capital to penetrate new markets and or develop new products.
7. Potential benefits overall are stronger corporations and fewer weak companies. Everyone should have seen the tax cut as incremental recapitalization. Len Charlap Princeton, NJ July 1
Here's the problem withe your argument Y. I agree that adding money to the privare sector is good for the economy IF IT IS DONE RIGHT, What history has shown over and over when you give money to corporation 1, happens, not all the other wished for possibilities. Since the shareholders tend to be much wealthier than the general population, what you have done INCREASES inequlaity.
Forget about fairness, inequality is BAD for the economy. Money going to the Rich is less useful than money going to the non-rich. Economists would say it has lower velocity The Rich spend a lower percentage of their money. What's a guy or gal who already has so many houses he can't remember how many & an elevator for his horse gonna spend his money on? The answer is he is going to use it to speculate.There is a correlation between inequality & financial speculation. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1661746 Speculation is bad for the economy. That money has a very low velocity. AND it increases risk which we have seen in 2008 ain't a good thing.Reply 5 Recommend
general, will take years to show results. Hence, economic science needs to wait years or even decades to fully evaluate the effects.
Jul 06, 2018 | www.nytimes.com
Clark Landrum Near the swamp. July 2
Most economic claims by the Republicans appear to be simply boneheaded assertions. They would have us believe that tax savings for the wealthy trickle down to the less affluent. Now they claim that the enormous slashing of government income caused by their tax cut for the wealthy is leading to a significant decrease in the federal deficit. Apparently about a third of the electorate are dumb enough to buy into their nonsense.
Observer Ca July 2
The trump tariffs are looking like the nixon tariffs of 1971. All trump, like Nixon in 1971, cares about is the mid term election and next presidential election, and the votes of 'the constituency of uneducated people' , as Nixon referred to them. Like Nixon, trump has total contempt for the law and ethics. Nixon's tariffs and china visit produced his re-election in 1972, stagnation for a decade, and a loss of many millions of US jobs that we never recovered from.
In 1970, before Nixon's China visit, Americans could get a decent job with a high school education. After the flood of Chinese masters and PhD students that followed, encouraged by Nixon and republican presidents since, and their dumb free but unfair market policies which made their ultra wealthy donors unimaginably wealthy combined with Chinese protectionism to this day-and stealing of US technology and property, currency manipulation, the neglect of US students who pay very high fees and much more, many tens of millions of US jobs migrated to china.
The same charlatans- the GOP and trump are manipulating uneducated white and rural voters, who are going to pay the heaviest price for letting themselves be misled.
Marcus Brant Canada July 2
Trump works on the premise that MAGA is a desperately needed, long overdue, patriotic race to save America from God only knows what. Harley Davidson, that most American of companies, has proven the validity of this morose mantra. Like other corporations, HD has benefitted from Trump's tax cuts while shedding American jobs: it purchased back tons of its stock then closed a plant in Kansas.
Then, following European tariffs being slapped on it, HD outsources jobs to Europe to avoid them. What temerity!
To Trump, this is a vile act of disloyalty. He had championed Harley's cause, only to see it abandon him. What he fails to comprehend is that very few corporations entirely buy into MAGA, only his, apparently economically ignorant, base embrace it. Companies enjoy it where it suits them, ignore or evade it when it doesn't. Corporations have too much power for Trump to curb. The only thing he can do is threaten to punish them through the imposition of punitive domestic taxes. That probably won't sit at all well with American workers, outpriced in their own backyard. Essentially, Trump et al, through intransigence and ineptitude, have backed themselves into a corner.
Recent SCOTUS decisions affecting organised labour will disenfranchise the worker even more. Anti union fervor might claim a short term battle, but the long term war of trade attrition will likely be lost as US companies lose their competitive edge by declaring employees liabilities rather than allies. Ludicrous.
BarryW Baltimore July 2
Economic propaganda has its place in promoting a healthy economy. However, it only goes so far. Real wages will ultimately trump (no pun) a healthy consumer out -look. Trump propaganda is a different breed all together. It promotes one thing only, a good out - look on Trump himself. Adoration for a job well done, regardless of how "potemkin" it is, feeds the beast. Economist, a notably disagreeable lot, do agree on at least two theories:
(1) Presidents actually have little effect on the economy and;
(2) the policies that they do implement reach the desired effect at least one and one half of a presidential term. Trumps tax plan, in the short term, is as effective as a penny dropped in the ocean.
In the long term, it will blow up the deficit and require major cuts in major governmental programs, such as Medicare and social security. Major targets for destruction by Ryan republicans. Trumps deregulatory platform is a "poor man's" economic policy. The long term cost of deregulation is unpredictable and therefore, frightening. High concentrations of lead in our ground water. Atmospheric poison. Toxic run off rears its ugly head.
Once eradicated illness and health concerns inundate a heavily overburdened healthcare system. All the while, the Trump propaganda machine churns out lies of triumph and facades of growth, worthy of the "Potemkin" villages.
Google matched content
Analysis of Donald Trump's Tax Plan Full Report Tax Policy Center
'Enough With That' Warren Backs Killing Filibuster to Push Through Progressive Reforms
Groupthink : Two Party System as Polyarchy : Corruption of Regulators : Bureaucracies : Understanding Micromanagers and Control Freaks : Toxic Managers : Harvard Mafia : Diplomatic Communication : Surviving a Bad Performance Review : Insufficient Retirement Funds as Immanent Problem of Neoliberal Regime : PseudoScience : Who Rules America : Neoliberalism : The Iron Law of Oligarchy : Libertarian Philosophy
War and Peace : Skeptical Finance : John Kenneth Galbraith :Talleyrand : Oscar Wilde : Otto Von Bismarck : Keynes : George Carlin : Skeptics : Propaganda : SE quotes : Language Design and Programming Quotes : Random IT-related quotes : Somerset Maugham : Marcus Aurelius : Kurt Vonnegut : Eric Hoffer : Winston Churchill : Napoleon Bonaparte : Ambrose Bierce : Bernard Shaw : Mark Twain Quotes
Vol 25, No.12 (December, 2013) Rational Fools vs. Efficient Crooks The efficient markets hypothesis : Political Skeptic Bulletin, 2013 : Unemployment Bulletin, 2010 : Vol 23, No.10 (October, 2011) An observation about corporate security departments : Slightly Skeptical Euromaydan Chronicles, June 2014 : Greenspan legacy bulletin, 2008 : Vol 25, No.10 (October, 2013) Cryptolocker Trojan (Win32/Crilock.A) : Vol 25, No.08 (August, 2013) Cloud providers as intelligence collection hubs : Financial Humor Bulletin, 2010 : Inequality Bulletin, 2009 : Financial Humor Bulletin, 2008 : Copyleft Problems Bulletin, 2004 : Financial Humor Bulletin, 2011 : Energy Bulletin, 2010 : Malware Protection Bulletin, 2010 : Vol 26, No.1 (January, 2013) Object-Oriented Cult : Political Skeptic Bulletin, 2011 : Vol 23, No.11 (November, 2011) Softpanorama classification of sysadmin horror stories : Vol 25, No.05 (May, 2013) Corporate bullshit as a communication method : Vol 25, No.06 (June, 2013) A Note on the Relationship of Brooks Law and Conway Law
Fifty glorious years (1950-2000): the triumph of the US computer engineering : Donald Knuth : TAoCP and its Influence of Computer Science : Richard Stallman : Linus Torvalds : Larry Wall : John K. Ousterhout : CTSS : Multix OS Unix History : Unix shell history : VI editor : History of pipes concept : Solaris : MS DOS : Programming Languages History : PL/1 : Simula 67 : C : History of GCC development : Scripting Languages : Perl history : OS History : Mail : DNS : SSH : CPU Instruction Sets : SPARC systems 1987-2006 : Norton Commander : Norton Utilities : Norton Ghost : Frontpage history : Malware Defense History : GNU Screen : OSS early history
The Peter Principle : Parkinson Law : 1984 : The Mythical Man-Month : How to Solve It by George Polya : The Art of Computer Programming : The Elements of Programming Style : The Unix Hater’s Handbook : The Jargon file : The True Believer : Programming Pearls : The Good Soldier Svejk : The Power Elite
Most popular humor pages:
Manifest of the Softpanorama IT Slacker Society : Ten Commandments of the IT Slackers Society : Computer Humor Collection : BSD Logo Story : The Cuckoo's Egg : IT Slang : C++ Humor : ARE YOU A BBS ADDICT? : The Perl Purity Test : Object oriented programmers of all nations : Financial Humor : Financial Humor Bulletin, 2008 : Financial Humor Bulletin, 2010 : The Most Comprehensive Collection of Editor-related Humor : Programming Language Humor : Goldman Sachs related humor : Greenspan humor : C Humor : Scripting Humor : Real Programmers Humor : Web Humor : GPL-related Humor : OFM Humor : Politically Incorrect Humor : IDS Humor : "Linux Sucks" Humor : Russian Musical Humor : Best Russian Programmer Humor : Microsoft plans to buy Catholic Church : Richard Stallman Related Humor : Admin Humor : Perl-related Humor : Linus Torvalds Related humor : PseudoScience Related Humor : Networking Humor : Shell Humor : Financial Humor Bulletin, 2011 : Financial Humor Bulletin, 2012 : Financial Humor Bulletin, 2013 : Java Humor : Software Engineering Humor : Sun Solaris Related Humor : Education Humor : IBM Humor : Assembler-related Humor : VIM Humor : Computer Viruses Humor : Bright tomorrow is rescheduled to a day after tomorrow : Classic Computer Humor
The Last but not Least Technology is dominated by two types of people: those who understand what they do not manage and those who manage what they do not understand ~Archibald Putt. Ph.D
Copyright © 1996-2021 by Softpanorama Society. www.softpanorama.org was initially created as a service to the (now defunct) UN Sustainable Development Networking Programme (SDNP) without any remuneration. This document is an industrial compilation designed and created exclusively for educational use and is distributed under the Softpanorama Content License. Original materials copyright belong to respective owners. Quotes are made for educational purposes only in compliance with the fair use doctrine.
FAIR USE NOTICE This site contains copyrighted material the use of which has not always been specifically authorized by the copyright owner. We are making such material available to advance understanding of computer science, IT technology, economic, scientific, and social issues. We believe this constitutes a 'fair use' of any such copyrighted material as provided by section 107 of the US Copyright Law according to which such material can be distributed without profit exclusively for research and educational purposes.
This is a Spartan WHYFF (We Help You For Free) site written by people for whom English is not a native language. Grammar and spelling errors should be expected. The site contain some broken links as it develops like a living tree...
|You can use PayPal to to buy a cup of coffee for authors of this site|
Last modified: May 30, 2020