Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign in

[paulmish]

Re: Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign

Jesse,

I really appreciate the opportunity to discuss these things! As a Mom in an affluent suburb, I'm "supposed" to be against things like low-income housing, welfare, etc., anything that upsets the entitlement applecart. However, my husband and I have been studying world politics, not just US politics, and the view is very different. For example the US contains 6% of the world's population but uses 80% of the world's energy. That is so wrong, and it really makes me angry because I despise greed, and I live in the middle of it.

Let me clarify - I grew up struggling to hang onto middle class - my parents split and we had a home and food, but we scrounged for everything. I didn't always have the things I needed, let alone fit in with the average lifestyle around me. So I grew up determined to make money. I waited tables and spent nothing on luxuries in order to get a Bachelor's - the first in my family. Then I started working,and never took more than vacation or maternity leave for 16 years. I had a increasingly comfortable lifestyle, but I was sort of confused about the people around me who were struggling. I used the "what they did wrong" game - they had kids too soon, too many kids, didn't go to college, had a one-income family, etc. But eventually I realized that there was some luck involved in my success. I was born with alot of drive. I didn't have alot of money, but I did have room and board at home while I attended college. I never got so sick that I couldn't get work, and I never got laid off. That realization changed me forever.

I'm still a yuppie (I have 70 pairs of shoes!), but now greed pops out at me, instead of going over my head. I think SUV's are ridiculous, and people like "Ahhhhhhnold" who endorse them should stick to other things, like abusing women. Gasoline is actually one of the smallest budget items for many people (for me, it's approx 3% of our monthly income after taxes), but they complain! I love to stay close to home - I have made more friends in town, and I would rather spend the money heating the pool for company.

Please bear with me for one moment regarding welfare. Don't you think that there is knee-jerk distaste for poor people? Many people find them disgusting, so welfare is a great target. Jesse, everyone abuses their "system." When I was working in IT, I was making 60K, and doing almost nothing except drinking coffee and chatting. Isn't that just as bad? Seniors with plenty of money rip off Equal and put buffet food in their pockets (My mom tells me the stories!). Corporations pay far less then their share of taxes - isn't that the worst abuse of all, since it is by far the greatest loss of funds? Isn't it ethically worse for a rich person to steal than someone who uses every dime for necessities? As far as you seeing the abuse, cops see law-breakers, teachers see rowdy teens (I'm now a teacher, but I love teens), etc. - so everyone has their own personal vision of who's "screwing things up."

It's arrogant to tell others to read a book, I think, but if you read "Being Nickled and Dimed in America," I think you would see another side to the issue.

Thanks - man, I talk too much!!
Michelle

[VJW]

Re: Vjw

You Rock!!

Isn't it frustrating how so few people understand the simple (but progressive) facts you are very eloquently stating?

Thanks.

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[jmjj215]

Re: Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign in

I'll use my blow money to get that book - sounds like a great read.

You're right - everyone abuses things in one way or another. I don't really agree with something being more ethically wrong if there are more zeroes at the end of the amount stolen - but there is a part of me that feels a lot of compassion for people that have been pushed to the extreme (a man here threatened to blow up the basketball arena several years ago, he demanded ransom from the very rich owner, an FBI agent delivered the money in a vacant park - he looked like the rich guy - they watched the briefcase, the perpetrator came and they swarmed and apprehended him. He needed the money for a life-and-death operation for his wife. The man went to prison, the rich owner paid for the wife's operation and supported the man's family while he was in prison for two years)

Anyway, so yes, there's some compassion there when people need the help because it is for absolute necessities.

I suppose I feel a bit upset b/c my standard of living is actually so much lower than so many people on welfare - seriously - but I don't take any welfare because I don't need it. The reason I don't need it (even though I make little enough to qualify for all the bells and whistles) is because I manage my outflow. I don't have a TV, we have one car and share it between the two of us. I work 40 hours per week and go to school full-time. So yeah, I guess I do feel a bit slighted. I really shouldn't though huh? I guess I should just be grateful for my drive, health, great little boy, and an absolutely gorgeous wife (who thankfully doesn't want 70 pairs of shoes! Ha! Well, she probably does, she's just biding her time.. )

I've also had several really awful experiences helping people in need and being treated just awfully for it. In one situation I really feel like I put my wife in a potentially dangerous situation and vowed I would never do it again (took a guy to a place he needed to go because he needed money for a bus ticket but I didn't want to give him money..). So that's kind of tainted my view also. I now donate funds to my church earmarked for needy people in the congregation and I feel a lot better about that.

My last and final point. I honestly, honestly feel that welfare is crippling to the character of the recipient. I feel like it suffocates creativity, ingenuity, and a strong work ethic. It cripples people economically. It's a temporary fix that offers in very few situations any long-term, lasting benefit. My church works to get people self-reliant, not just hand out money. I think that's the key. Things like microloans in 3rd world countries are right along my thinking with this. Teach a man to fish..

Did I match your post length? maybe..

[VJW]

Re: Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign

VJW,
How do economists ascertain the correct cause of an effect? '93-'00 was the greatest prosperity, and you are assigning, at least partially, higher taxes as one of the causes.

Not entirely, as a lot of that increased revenue was wisely used to pay down more than a half a trillion dollars of the Reagan/Bush federal debt.

However, there is some economic incentive involved. Contrary to failed RightWing theories, lower tax rates do not produce more business actively, business investment, or economic growth, as evidenced by the poor performance every time it has been implemented.

I personally know of several companies that laid off all of their workers and shut down in the '80s, because they could make a better return investing the companys' capital in the bond market.

When taxes on the wealthy are too low, they tend to be satisfied with the return of just investing in the stock and bond markets. When taxes on the wealthy are higher, they have to take more risk to earn and retain the same level of return. Therefore, they will tend to invest in more start-ups and new technologies which is far superior for the overall economy.

I've heard people say that the "Boom" to quote the thread-starter, was a result of Reganomics - which you obviously TOTALLY disagree with! I would love to know the answer. I've heard it both ways. What facts have you looked at that helped you draw the conclusion that it was NOT the previous economic policy of Regan that contributed to the awesome economic growth during those 8 years? Certainly economic policy takes a bit of time to really settle into the system?

It was impossible for any policies enacted under Reagan to be responsible for the economic turnaround in '93, as everything was going in the wrong direction. In Reagan's last year in office, the federal debt was exploding faster the national economy was growing, a completely unsustainable situation. Both inflation and the Prime Rate were rising, the 'Standard of Living' of the vast overwhelming majority of American workers was still going backwards, and all of the job creation during his term amounted to what at that time was referenced as "McJobs" (not a single net new job was created that paid more than $20K).

You just can't get there from there (so to speak).

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[paulmish]

Re: Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign

Yes! I totally agree about Welfare crippling people, for life, even. I misinterpreted your statement about Welfare as a punitive statement, probably because I hear so many around here. You hit the nail on the head - our government could care less if any jobs exist which you can survive on (Nickeled and Dimed's theme), but want to kick people off welfare. Once a women has 4 kids, she is chained for life - it's just too late for self-sufficiency. Why not get over the personal feelings and work with the next generation? Why, indeed? The usual answer - lobbyists, Republicans, and Corporations. The money isn't there because the only people who care, like you and I, have no control over where the money goes.

One last thing, and then I'll go off and do something more productive! When you said that you would qualify for welfare but you don't need it, well, I just wanted to say that "needing it," isn't always a dollars and cents judgement. You clearly sound very intelligent, with a strong sense of self. I'm assuming that you grew up in a nurturing environment, with solid role models, and personal encouragement to succeed. You also have the love of a family, and the excitement of a new future. I doubt that 14-year-olds living on Welfare in a dumpy neighborhood have those very critical building blocks. Let's face it, many adults on Welfare were blameless children once, born into an environment that, as you said, "cripples them." It doesn't sound like you really need anything you don't already have!

Thanks,
Michelle

[jmjj215]

Re: Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign in

You are saying great things here. I'm really loving this dialogue.

a nurturing environment, with solid role models, and personal encouragement to succeed. You also have the love of a family, and the excitement of a new future.

The 14-year old needs all of those things quoted above. So the government gives them money? In doing this, the govt. is telling the parent that their child needs money. But clearly, truly, money gives none of these things. So the parents think they need money, and the kids learn that what they need is money...bleh.

Another bone to pick about welfare is the inefficiency of the system. Did you know that if the govt cut out the system in place to get the money into the hands of each and every entitled welfare recipient, that they could simply cut a check for $40,000 to each family on welfare? So much money, so many resources, are absolutely wasted..

Churches and other charitable organizations can provide welfare on an indvidualized, local basis. And, this may be naive, but I believe people give to charitable organizations b/c giving is empowering - not just for the tax write-off. Money in the hands of these local organizations can then be used to evaluate welfare needs on a case-by-case basis. I know this works because my worldwide church uses this exact system - but operates as a local unit of about 400-600 people. It really does work. Money gets into the right hands, the hands that truly need it, and the people doing the giving and serving are rewarded 10-fold for their generosity. And the government can worry about preserving our rights and protecting our borders.

[VJW]

Re: Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign in

Another bone to pick about welfare is the inefficiency of the system. Did you know that if the govt cut out the system in place to get the money into the hands of each and every entitled welfare recipient, that they could simply cut a check for $40,000 to each family on welfare?

That's a highly exaggerated figure, but the concept is not new. It was Nixon who proposed the "Negative Income Tax" to replace welfare. If a family of four earned the poverty level (say $18,000), they would owe no federal tax. If they earned more, they would be taxed only on the amount above that level. If they earned less, the government would cut them a check for the difference between what they earned and the poverty level.

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[paulmish]

Re: Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign

jmjj215 - Uh oh!

We just diverged widely when you suggested that Churches do a better job of judging need and efficiently distributing relief. I think that Church based charity should be totally decided by the members. However, no one Church can include all needy Americans. That's the purpose of a Democratic government. What if I am a reformed Heroin addict, and the local Church decides that I don't deserve help? Welfare is as inefficient as any other Federal institution, but it is "blind," like justice (I'm speaking in theory here). No one person or organization can single out who needs help, who needs more help, etc. The idea of not doing it that way turns my blood cold. Throughout history, Religions have bullied, dominated, and murdered those that they deemed "unworthy". Many people believe that those were the "old days," before we were "civilized." I don't agree. Freedom and generosity is always more evident in a wealthy country, without exception. As soon as pickings are slim, the natural human instincts of greed and survival kick in.

For the most part, we have religious freedom in the US. I do dislike the assumption that some (ignorant) people make that we are all Christian. I deal with that alot in RI, because Catholicism is the majority, and some people actually believe that Catholicism is the majority religion in the US, and in the world (actually 30% worldwide). I have ceased to be associated with any formal religion. I believe in Love, Sharing, and Right vs. Wrong. My standards are very very high.

You seem like a good person. However, I despise the way the current administration is trying to convince everyone that we should return to our "Christian Roots," when the US was NOT founded on Christianity, it was founded on freedom and choice. That's a right I would fight for.

Simply stated, which Church would be "the one" in each geographic area? Christian? Muslim? Unitiarian? Paganism? No, the best choice (while not perfect) is the one group we all belong to - citizens of the US.

(Hey Michelle, get off the soapbox - you're blocking the view!!!)
um, OK.

[jmjj215]

Re: Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign in

yeah, we diverged, but probably because I didn't make myself clear. I like my church and can see - at a local level - where the money goes. so I give to that church. You might give to come other welfare-type charitable organization that is in no way religious. I didn't mean that churches should handle it - I meant that private charitable institutions should handle it.

VJW, Why was that idea of Nixon's shot down? That seems pretty cool.

[JLP]

Re: Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign in

I'm all for a flat tax at 10%. No deductions, loopholes, or any other messy stuff. You make income - any income - it gets taxed 10%. This is the ONLY fair way to do it! I don't like the progressive income tax.

[paulmish]

Re: Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign

The problem with private institutions is that they have no obligation for any set level of assistance. Also, Federal agencies have access to things like the poverty level, inflation, etc. Make no mistake, this private stuff is just another smokescreen to lower taxes on the wealthy and replace Welfare with private organizations that the middle class will be stuck supporting. - you know the poor and indigent won't be hanging out in the rich neighborhoods! Welfare works fairly well, in my opinion - why not improve it by subsidizing childcare? This would encourage education, and by golly, create jobs (family and professional daycares)! The answer is that the administrative is totally chauvanistic, and daycare is a dirty word. Also, you-know-who blathers on about the traditional family (which existed for, like, 20 years), so I guess only women on Welfare should work? What a crock.

Welfare is not by any means even a blip on the screen of Federal priorities. It's just a handy tool to "explain" where our tax dollars are going, without telling the truth. Along with Police, Firefighters, and Teachers (me, now), it is the favorite scapegoat of Corporate controlled, so called, "news" papers.

[JLP]

Re: Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign

Another large problem is INEQUITABLE TAXATION REVENUE:

* Percent of general fund tax collections from corporate taxes:

1940s - 33%
1950s - 31%
1960s - 27%
1970s - 21%
1980s - 15%
1990s - 16%
2000s - 11%

* Percent of general fund tax collections from individual income taxes:

1940s - 44%
1950s - 49%
1960s - 57%
1970s - 66%
1980s - 72%
1990s - 71%
2000s - 76%

[Internal Revenue Service]

http://moneycentral.msn.com/content/Taxes/P80242.asp

.

Your figures are misleading because there are a lot more women in the workforce these days and therefore household income has increased dramatically which would naturally lead to more taxes going to the government.

[JLP]

Re: Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign

The problem with private institutions is that they have no obligation for any set level of assistance. Also, Federal agencies have access to things like the poverty level, inflation, etc. Make no mistake, this private stuff is just another smokescreen to lower taxes on the wealthy and replace Welfare with private organizations that the middle class will be stuck supporting. - you know the poor and indigent won't be hanging out in the rich neighborhoods! Welfare works fairly well, in my opinion - why not improve it by subsidizing childcare? This would encourage education, and by golly, create jobs (family and professional daycares)! The answer is that the administrative is totally chauvanistic, and daycare is a dirty word. Also, you-know-who blathers on about the traditional family (which existed for, like, 20 years), so I guess only women on Welfare should work? What a crock.

Welfare is not by any means even a blip on the screen of Federal priorities. It's just a handy tool to "explain" where our tax dollars are going, without telling the truth. Along with Police, Firefighters, and Teachers (me, now), it is the favorite scapegoat of Corporate controlled, so called, "news" papers.

Wasn't it a democrat who signed the Welfare Reform Bill?

[VJW]

Re: Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign in

I didn't mean that churches should handle it - I meant that private charitable institutions should handle it.

That doesn't work. That was proven in the 1930s Great Depression, when the private sector "charitable institutions", as well as the churches, came hat in hand to the federal government. Not to mention that as the wealth in this country is being concentrated more and more at the top, that top gives less and less to charity.

Why was that idea of Nixon's shot down? That seems pretty cool.

The usual suspects. The RightWing of the party shot it down, but they were all for Corporate Welfare.

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[VJW]

Re: Tax revenues surging, deficit shrinking, yet tax rates are lower. Now just reign

I'm all for a flat tax at 10%. No deductions, loopholes, or any other messy stuff. You make income - any income - it gets taxed 10%. This is the ONLY fair way to do it!

That wouldn't even pay for the Military Industrial Complex, let alone the interest on the Reagan/Bush federal debt. The entire rest of the federal government would be shut down.

Your figures are misleading

A) No they're not.

B) They're not MY "figures".

because there are a lot more women in the workforce these days and therefore household income has increased dramatically which would naturally lead to more taxes going to the government.

A) "Household income" is not a measure of anything unless you are examining a specific number of households, which your assertion does not.

B) The shift you speak of did not take place until the 1980s. Prior to Reagan, the vast overwhelming majority of married women did not work outside the home. Well before the end of the '80s, the vast majority of married women worked outside the home. This occurred because the 'Standard of Living' of the vast overwhelming number of American workers went backwards by almost 20% during the 12 years of Reagan/Bush.

Therefore, your assertion is false.

Wasn't it a democrat who signed the Welfare Reform Bill?

Yes, and President Clinton campaigned on reforming welfare. However, first he twice vetoed the Republican version.

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