Saturday, March 5, 2011
Apples and, I Don't Know, Kumquats?
The bipartisan/revenue-neutral Tax Reform Act of 1986 is extremely instructive. It specifically gives us a blueprint on how to compare the tax-rates of today with the rates of previous generations (i.e., those prior to 1986). The mechanism for this is the ratio that one arrives at via the comparison the top rate prior to the legislation (50%) with the top rate subsequent (28% - a rate that was arrived at via an elimination of many tax-shelter, loopholes, etc.) to it.................................................................................................So (and, yes, using this 50:28 ratio), the current top rate of 35% would equate to a pre-1986 rate of 62.5%. The pre-Bush era top rate of 39.6% would actually be 70.7%. And, yes, the 60, 74, and 90% proposals put forth by various liberals would translate to 107.1, 132.1, and 160.7% rates respectively. Youza, huh?................................................................................................So, what, pray tell, would the 91% rate of the Eisenhower administration translate to? That, folks, would translate to a current rate of approximately 51% (the Kennedy rate of 70% would translate to 39.2%). Interesting, huh? I mean, at the very least it narrows (or it should) the debate somewhat. Instead of people debating between a myriad of rates between zero and a hundred, they should probably be focusing on a continuum of 28-51 (at least for now!). This, folks, in that apparently is where the debate been for the past hundred years or so.
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11 comments:
Its easy Will,two words....Flat Tax.
I'm for kind of a modified flat-tax, Russ. I'd have the first $30,000 or so not taxed at all. Then I'd have the amounts $30,000 to $1,000,000 taxed at a flat rate of 30 (or so)%. All income over $1,000,000 I'd tax at 40 (or so)%. It's basically a flat tax with some progressivity aimed at the top and bottom. A compromise, in other words.
Will,you're the resident middle of the road guy so I have a question for you.I'm looking for a middle of thr road answer.
Do you remember a few years ago when gas and oil prices spiked...gas was closing in on $3 per gallon and oil was chasing $100 a barrel? I seem to remember our liberal friends blaming the rising cost on George Bush and his relationship with the Saudi royal family.Well, gas is now over $4 a gallon and oil is over $100 a barrel with no end in site but not a peep about it being Obamas fault.What would you call that Will?
On another subject yesterday Obama annocuned that military trials will be restarted in Gitmo.Now,am I wrong or did Obama campaign on closing Gitmo and stopping all military tribunals?
I'm gonna make a wild guess and say that the liberal poster here will be very quiet on these subjects.
It's called hypocrisy, Russ. There's more than enough of it on both sides.
Very cool Will, I've never heard of this ratio before. Any chance you have a link where I can learn more about it?
Actually, RN, all that I did was look up the Tax Reform Act of 1986. It was supposedly a revenue neutral bill and reduced the top tax rate from 50% to 28% (offset by massive eliminations in loopholes and shelters). The reason for me introducing it is because you have guys like Thom Hartmann advocating a top rate of 74% and rationalizing it by saying that we once had a 91% top rate. For perspective, in other words.
I reject your notion that (what you've described) is an extremely instructive blueprint should narrow the debate to a continuum of 28-51 percent.
Robert Reich recently proposed raising the marginal tax to 70 percent. Did he really mean 125 percent? Would someone who is a Rhodes Scholar in the field of economics propose an individual pay more in taxes per year than said individual earns in a year?
Mr. Reich's proposed rates are 70% for $15 million plus, 60% for $5 to $15 million, and 50% for incomes between $500K and $5 million. To me these rates sound closer to where they should be.
The high oil prices are due to Wall Street speculation. "Stop Oil Speculation Now" says that the Wall Street reform legislation signed by president Obama "should close loopholes, improve oversight and increase transparency in the oil and commodity markets". They further say that "the Commodity Futures Trading Commission is in charge of interpreting the anti-speculation legislation... but this process could take up to a year to implement. This extra time provides Wall Street lobbyists with the opportunity to push for weak regulations".
I blame Speaker Boehner and House Republicans who are working to block implementation of the legislation.
I oppose Gitmo military trials. I opposed them under Bush and I continue to oppose them under Obama.
wd, obviously you can't pay more than 100%. I was simply drawing a comparison and showing how extreme some of these suggestions are......I'm assuming that Mr. Reich (who I actually like and agree with on certain things) also wants the FICA raised, too. That would bring it up to 76%. Add to that the 9% top rate in NY (granted, that can be deducted FOR NOW) and you're up to 85%......Bottom line - I just think that we have different assessment of fairness.
I think WD just wants to tax anyone who has money.I'm also guessing that WD does'nt have any serious money and does'nt have the ambition to make any serious money so WD wants someone who did have the ambition and balls to go out and make some money to give some of it to him in some form of a government program...yea,that sounds like the lliberal point of view....you make it,I'll take it.
What an interesting day.James O'Keefe...yea the guy who helped push ACORN over the cliff has stuck a long sharp knife into NPR.Those ignorant liberal pukes sure did shit in their mess kits,not only did the top two lose their jobs but this is gonna put the end to federal funding for them and PBS and this has been a long time coming.
For icing on the cake Gov.Walker and the brave republicans in WI found a way to bypass the dem cowards who fled their responsibilties and have passed the cost reduction bill...bravo to a young vibrant governor!
Truth in advertising, Russ, I'm actually in favor of the top rates going back to 39.6%. With a 14 trillion dollar debt, I simply don't see how spending cuts alone can eliminate it.......Having said that, though, the suggestions coming from the progressives that we should be taxing people at 60, 70, 80, 90% - I think that that's insane. 1) They're (those rates) punitive and confiscatory (please, keep in mind that they also want to raise the FICA threshold to UNLIMITED). And 2) they're probably not all that good for the economy; the fact that they destroy incentive, etc..
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