The Fruits of Apostasy: Politcal Correctness

[_Droopy]

About corporate taxes, it should be noted that corporations very rarely pay 35% income taxes.

CFR.

Corporations have dozens or hundreds of tax attorneys working for them to manipulate and take advantage of every possible loophole and tax shelter available to them. This is why so many corporations today pay zero income taxes.

CFR

And this should serve to refute Droopy's belief that lower taxes is the way to go to spur investment, create jobs.

If you adduced any fact, data, empirical evidence, or logical argument here, it might. You know, its funny, but the claim that "lower taxes is the way to go to spur investment, create jobs" is logically and conceptually self evident. In the face of this, I invite Kevin to elucidate what does spur investment and create jobs, if not an environment that incentivizes productive economic activity (i.e., savings, risk, entreprenership, and letting those who create, work, and produce keep most of what they earn, and not punishing them when they save and invest it in other productive economic activities)?

tell me, did Exxon Mobile hire more workers after it was able to retain its billions in profits without a single dollar in tax liability? What about General Electric?

The Soros funded (and which he helped launch) spin factory, Center for American Progress, where Graham most likely got this claim (instead of doing some broader and deeper study of the matter), arrived at this by only counting American corporate income tax, which, at 35%, is one of the highest and most uncompetitive in the western world (and consider that the profit margin for an oil company like Exxon is roughly 7 cents on every dollar of sales over the last five years).

In 2010 Exxon made $7.7 billion in gross income, paid $340 million in state income tax and 1.3 billion in federal income tax, for a total of an 18% tax rate. But the actual effective tax rate may be as high as 48%. The above is not by far all the taxes, or all the kinds of taxes, oil companies pay.

http://www.scribd.com/doc/40160245/Amer ... heir-Share

None, because it was just a ruse. These folks never believed their own BS to begin with and I proved this with the Milton Friedman citation. They always knew that lower taxes mean higher deficits and few revenues.

As you pointed out yourself, this is the real purpose and meaning of tax cuts - the starving of Big Brother.

Rare it is that someone checkmates himself.

They knew this from day one, but the couldn't just come out and say that. They had to make up this BS about how lowering taxes boost economy and creates jobs

This, unfortunately for you, has empirical fact and economic history behind it, and no amount of polemical theatrics can or will alter stubborn facts. Economic growth, economic liberty, and the other liberties guaranteed by the Constitution that are threatened by excessive taxation (read: excessive and illegitimate state power) are the twin pillars of "supply side" economic policy.

We now know this was a myth, and those responsible for it represent everything that is wrong with this country. It is all about lies and manipulation for selfish means.

Populist class warfare demagoguery. Move along...

When the rate is 35% and corporations can work the system to pay on average only 15-20%, then the rate needs to be raised to 60%, just so they'll finally pay around 30-35%.

1. How many jobs are you willing to destroy or send overseas to legitimate your pop Marxist moral posturing?

2. I've a better idea: let's scrap the entire United State tax code altogether and move to a fare, low, flat tax that taxes all income equally at the source, and which can be filled out on a postcard sized form.

Welcome to Capitalist America, where legislation is up for the highest bidder.[/quote][/quote]

Or you can go to Kevin's kind of place, Cuba, where uh...well, things are different...

[_EAllusion]

http://www.scribd.com/doc/40160245/Amer ... heir-Share

A talking points bulletin from the American Petroleum Institute? Heh. Heck of a source there Droopy.

[_Droopy]

Just as a quick heads up, the effective corporate tax rate as a % of GDP in the US is one of the lowest in the world. The satutory rate is quite high against world standards, but there are so many loopholes, deductions, and qualified rebates/subsidies, and tax shelter schemes, that on balance it's quite low.

http://blog.heritage.org/2011/04/01/mor ... -overseas/

http://www.heritage.org/Research/Report ... e-Tax-Rate

Even with all the loopholes, the businesses that exploit them spend billions of dollars - dollars lost in tax avoidance behavior that otherwise would have gone into business expansion and job creation. This is money lost to productive economic activity - a windfall for lawyers and tax consultants who depend on the present tax system for their livelihood doubtless - but a drain on the larger economy.

The same is true of the billions in otherwise productive capital lost by businesses to the compliance costs of following labyrinthine IRS regulations each year.

[Guest]

http://www.scribd.com/doc/40160245/Amer ... heir-Share

A talking points bulletin from the American Petroleum Institute? Heh. Heck of a source there Droopy.

It would only post a problem for a committed leftist for whom corporations and the making of profit are, by definition, evil, and their statements and arguments, by definition, suspect.

No one else.

[_Droopy]

You are, of course, free to refute the statements made in that article, all of which are empirical claims, with facts and documentation.

[Guest]

Who cares whether it is a cut in rate, a credit or a deduction as long as it reduces your over all taxes.The impact is the same.
A tax credit is no more funded by government revenue than a tax cut is unless as you noted you are receiving more tax than you actually paid in as is the case with only a few credits- the earned income credit and child credit being the primary ones-both of which have been in place longer than Obama has been president.

The impact is monumentally different. As I pointed out above, all of the Obama "tax cuts" aren't tax cuts at all, but wealth transfers. Tax credits that send you a check from the federal treasury are not productive as tax cuts (and they aren't tax "cuts" in any cogent sense at all, which should not be lost sight of) because they do not create wealth, across the entire economy. They may be a windfall for you, (if the government sent every man, woman, and child in the country a check for $1 million dollars, everyone would be far wealthier, but no wealth whatsoever would have been created (and the economy would implode) but the recession is national, and is not just hitting your household or your town.

Shifting wealth from one place to another is not wealth creation, even though it appears to have "created" wealth for you (you have money in your hands you didn't have before). One provision, a $500 per worker tax credit, cost the federal treasury $150 billion. A tax credit to assist you in buying a Prius or a Volt is taken out of the private economy and transferred to you. This appears to you as "wealth creation" (for you, as in individual) but represents a net loss to the economy.

This is wealth shifting, not wealth creation stimulated by cuts in marginal rates that incentivize work, savings, investment, and entrepreneurship.

All the other provisions, including the the $4,000 tax credit for college tuition, the 10% mortgage interest tax credit, the savings tax credit of 50% up to $1,000, the expanded earned-income tax credit, the child care credit, and the "clean car" credit, are government subsidies. They cost the American taxpayer money. They are wealth transfer programs like any other wealth transfer program. They do not create wealth, they do not incentivize work , and they have nothing to do with job creation and economic expansion. They are a net cost to the economy.

Yes so what? And so what if there was a credit for purchases of hybrid cars (which was not allowed for AMT purposes). It is not a new thing for the government to provide certian incentives for behavior it wishes to encourage.

1. Calling it a "tax cut" is a bald deception.
2. Such measures have nothing to do with job creation and economic expansion.
3. By definition, if the state needs to subsidize a technology or industry, that industry is, ipso facto, economically unviable (save for certain industries that have no inherent or viable private market by their very nature, such as, for example, cruise missiles).
4. It is none of the state's business to encourage or discourage what kind of car I drive.

There was also the Cash For Clunker under Bush if I recall. Were you unhappy with that one as well?

It was a major boondoggle. Not even worth mentioning.

A cut is a cut whether in the over all tax rates or credits.

Dead wrong.

Right now your FICA tax is down 2% this year. Is that not a tax cut for you? Does it not put overall more cash in you pocket? Does it not reduce the over all average tax rate you pay for all your taxes? A credit or deduction does EXACTLY the same thing. It lowers your tax bill and thus your overall average tax rate.

Why are you changing the subject?

Yep. And how about in NY where there is what is called a Qualified Emerging Technology Credit that is for businesses in targeted industries or that spend a certain % of their income on qualifying R&E activities. This is a refundable credit up to $250,000. Do you view this as an evil redistribution of wealth as well? Or is it a wise use of NYS taxpayers money to generate and attract companies into the state for economic development purposes?

I have no problem with it if it is a tax cut in the rates they will pay to relocate. If it is a transfer of wealth from the taxpayers to the company, then it is corporate welfare, which I am against.

Even a tax rate reduction is a federal expenditure because it reduced revenue.

Oh come on Jason, this is inside-the-beltwayspeak. If you lose a few days of work due to sickness, do you call that an "expenditure" or a net loss of income, and curtail your spending for the time being accordingly?

Not having a certain amount of revenue does not "cost" the government any money, and forgive me for saying so, but this claim embroils one in the nakedest of sophistry. All it means is that they can only spend what they have. The hidden assumption of this argument, that the government has a preemptive claim on any quantity of your money it so desires, and is the actual owner of your paycheck until it decides what you shall be allowed to keep, is a bit...disturbing, don't your think?

As I've already shown, and as is acutely available all over the web, in intellectual reviews and other venues for anyone interested on both sides of a political issue, Obama was set to raise all marginal rates from the lowest to the highest to a substantial degree,

Not on incomes under $250k. This is indisputable.

Wrong. That was a later emendation.

http://www.atr.org/days-thebr-largest-t ... tory-a5370

http://www.heritage.org/Research/Report ... -Americans

The Tax Relief Act of 2010 was passed in December of 2010. The details you see in the second source here reflect resistance to his original plan, as well as further tax increases retained in the compromise. The provisions of that act expire in 2013.

Yes from 15% to 20%. Before the Bush cuts dividends were taxed at whatever your normal rate was

So, why should dividend tax rates be raised? Why not lower, or abolish them?

Hmmm not that I am aware of.

Not necessarily direct federal corporate income taxes, but numerous other forms, including Obamacare (unless waivers are granted, which seems to be the wave of the future, McDonald's having just been exempted).

How could the president increase real estate taxes? These are set locally.

No, the estate tax...the "death" tax.

[_Droopy]

Oh, and before I retire to my bed of nails for a well deserved beauty sleep, I thought we should put Kevin on the rack again, ratchet it up a few notches (until some tendons start to pop) and see what we get when we take a closer look at the Milton Friedman piece he linked to.

Like many of the evangelical demagogues of old, such as Walter Martin (whom Kevin resembles in his own, unique secualrist way), when you actually follow his links to his sources and take a closer look, you see that what he claims for their authors cannot be found in the source at all. Indeed, you may find exactly the opposite. A case in point is this Friedman interview he linked to.

Here is what Kevin claims Friedman is saying here:

For example, Milton Friedman in Wall Street Journal 1/19/2003, admits that tax cuts result in deficits, and that this is a good thing because it would force government to spend less.

These folks never believed their own BS to begin with and I proved this with the Milton Friedman citation. They always knew that lower taxes mean higher deficits and few revenues. They knew this from day one, but the couldn't just come out and say that. They had to make up this BS about how lowering taxes boost economy and creates jobs. We now know this was a myth, and those responsible for it represent everything that is wrong with this country.

Graham wants us to think, using this cherry picked Friedman quote, that Friedman was admitting that tax cuts don't stimulate economic growth or raise government revenue. What, however, did Friedman actually say?

John Hawkins: Now let me ask you about that. In the Reagan years, we cut taxes and it ended up leading to economic growth which increased the amount of revenue that came into the government.

Milton Friedman: Well, economic growth will inevitably increase the amount of revenue coming into the government. But so far as the Reagan years were concerned, we have to be careful there. There were initial cuts in 1981-1982 and then there was a very good income tax law in 1986. But in between that, there were increases in taxes as well. So it's not an entirely clear picture that you can attribute the growth in revenue entirely to the tax reductions. But it's a hard thing to disentangle the effects of several things happening at the same time. In particular, there's no doubt that growth is very favorable to government revenue.

Graham, in other words, is engaging in open prevarication and hoping you don't do your own homework by following his links and actually reading his sources. What Friedman is actually saying (not "admitting") is that some of the revenue enhancement in the Reagan years is probably explained by the tax increases that concomitantly took place. He then reiterates the essential point that tax cuts increase economic activity and hence, expand the tax base and raise government revenue. Graham's credibility? Any takers?

No doubt, Friedman believes in using tax cuts to essentially shrink and truncate the size and scope of government, but to do that, tax cuts will have to be both substantial and - and this is as key for the supply siders as for the libertarian monetarist Friedman - stop excessive government spending. Friedman makes this clear in the same interview:

I am in favor of cutting taxes under any circumstances and for any excuse, for any reason, whenever it's possible. The reason I am is because I believe the big problem is not taxes, the big problem is spending. The question is, "How do you hold down government spending?" Government spending now amounts to close to 40% of national income not counting indirect spending through regulation and the like. If you include that, you get up to roughly half. The real danger we face is that number will creep up and up and up. The only effective way I think to hold it down, is to hold down the amount of income the government has. The way to do that is to cut taxes.

As a side note, notice that Friedman mentions that "Government spending now amounts to close to 40% of national income not counting indirect spending through regulation and the like. If you include that, you get up to roughly half."

So much for people like Mr. Graham and the journalistic wing of the Democratic party (CBS, NBC, ABC, MSNBC, CNN, the New York Times, Washington Post etc.) insulting people's intelligence by telling them that American tax rates are too low. The cost of government, at all levels, is consuming approximately half the wealth produced in the private sector in any given year.

Nothing on the Left is as it seems folks.

Nothing.

[_EAllusion]

It would only post a problem for a committed leftist for whom corporations and the making of profit are, by definition, evil, and their statements and arguments, by definition, suspect.

No one else.

I think citing the unverified assertions of a consortium of petroleum companies as your source for whether petroleum companies pay a fair share of taxes would be problem for anyone who has a capacity to evaluate the credibility of sources.

[_Droopy]

I think citing the unverified assertions of a consortium of petroleum companies as your source for whether petroleum companies pay a fair share of taxes would be problem for anyone who has a capacity to evaluate the credibility of sources.

1. Unless this is to be taken as a commission of the ad hominem circumstantial fallacy, you would have to provide a reason to think that this consortium of petroleum companies was incompetent or untrustworthy regarding states of affairs as they stand among the industry in which they have expertise, and which you do not. As the tax records of these companies are publicly available, it would appear that deception would be futile.

What would be a better source for claims regarding oil company tax numbers?

Tax and power hungry politicians? Ideologically hostile anti-corporate political activists? Rent seekers thirsty for government subsidy?


2. Define what a "fair share" of taxes is.

[_Kishkumen]

Graham, in other words, is engaging in open prevarication and hoping you don't do your own homework by following his links and actually reading his sources. What Friedman is actually saying (not "admitting") is that some of the revenue enhancement in the Reagan years is probably explained by the tax increases that concomitantly took place. He then reiterates the essential point that tax cuts increase economic activity and hence, expand the tax base and raise government revenue. Graham's credibility? Any takers?

In other words, tax cuts alone do not stimulate the economy. I knew that. And, I would add, that the benefit of cutting taxes does not mean that every tax cut always stimulates the economy. The myth that tax cuts will always result in increased revenues is, simply put, stupid.