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Old 11-06-2013, 08:20 AM
 
34,620 posts, read 21,521,102 times
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Quote:
Originally Posted by MTAtech View Post
Why do you think that? If businesses want to invest, they already have plenty of reserves sitting on the side-lines. They don't need lower taxes to fund their ventures.
I'll tell you what. You loan me $25,000 and next year, I'll pay you back the $25,000 plus $10 in profit. What do you say?

As risk increases and potential return decreases, people (and companies) reduce investment.

I didn't think it was a very difficult concept to understand, but apparently it is.

Answer me this. Why do Apple products come out of China and not the US? Once you answer that, you'll understand the flaw in your logic.
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Old 11-06-2013, 08:23 AM
 
18,792 posts, read 8,409,237 times
Reputation: 4125
Quote:
Originally Posted by PedroMartinez View Post
The reason it's different is because the government can essentially force additional revenue while a household cannot. If you spend more than you have coming in from your job, you aren't able to tell your employer that it must pay you more. The government can tell the taxpayer it must pay more.

However, in a global market, the tax payers (specifically the business owners and large investors) are able to flee the government once they feel that they are better served living under a government that confiscates less.

Going back to the household incomes, what would happen in a company's employees could force their employer to pay them more? What would happen if all of their employees forced greater and greater pay increases each year regardless of the company's bottom line? Eventually, the company would go broke and then the employees would have no way to pay their bills.

What happened in Detroit? Employers left due to high wages and market changes. Unemployment increased. Tax revenue decreased. People fled to other markets. The government was forced to reduce spending and cut services.

That's right, eventually the government (of Detroit) ran into the same problem a household runs into when revenue no longer matches receipts.
Detroit, just like you and me, businesses and states, and Greece are not monetarily sovereign. So their balance sheets are conventional.

The Federal balance sheet has not been conventional since we went off the gold std. in 1971. And those that cannot get their heads around that fact will dwell in an antiquated economic paradigm and remain disadvantaged.
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Old 11-06-2013, 08:29 AM
 
Location: TX
795 posts, read 1,388,463 times
Reputation: 786
^ True. Don't believe anyone who tells you corp taxes are a burden on business.

Taxes are only assessed after a company has already made its profits. They are not an operating expense.

They are a burden to shareholders, but not to the business's internal operations.
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Old 11-06-2013, 08:33 AM
 
18,792 posts, read 8,409,237 times
Reputation: 4125
Quote:
Originally Posted by celcius View Post
^ True. Don't believe anyone who tells you corp taxes are a burden on business.

Taxes are only assessed after a company has already made its profits. They are not an operating expense.

They are a burden to shareholders, but not to the business's internal operations.
Hey it would be great if they would eliminate my C corp taxes!
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Old 11-06-2013, 08:49 AM
 
20,622 posts, read 19,277,825 times
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Quote:
Originally Posted by Hoonose View Post
The math is easy. Interest expense hasn't changed much in 25 years.

http://www.treasurydirect.gov/govt/r...ir_expense.htm

Hey that looks like a bank statement.

principle :

intrest :

and crow.
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Old 11-06-2013, 09:51 AM
 
34,620 posts, read 21,521,102 times
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Quote:
Originally Posted by celcius View Post
^ True. Don't believe anyone who tells you corp taxes are a burden on business.

Taxes are only assessed after a company has already made its profits. They are not an operating expense.

They are a burden to shareholders, but not to the business's internal operations.
ROFLMAO!!!

Try telling a business owner that the taxes they pay are not a burden.

If I own a business, and my profit is $60,000 and I have to pay (hypothetically) $15,000 of taxes, that's not a burden? Really?

BTW, you might want to contact the CEO of the corporation I work for and tell him that he should not make any of his decisions regarding opening more facilities or investing in additional R&D based upon profit. The idiot actually seems to think it matters. You need to correct him (and probably every other CEO out there as well).
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Old 11-06-2013, 10:09 AM
 
Location: Vallejo
21,700 posts, read 24,920,758 times
Reputation: 18970
Quote:
Originally Posted by jimhcom View Post
Even in a reserve currency system, there are consequences for unlimited credit creation. The IMF is now recognizing that. It would make perfect since why the government is perusing such an irresponsible policy knowing at some point it will just offset the debt by confiscation of a large chunk of private wealth.

We are already seeing some of the justification for such a move with the liberal’s position that people with money or success did not earn that on their own. Such a position would segway nicely into the social position that would justify a large confiscation of wealth in order to finance ongoing social programs and to stabilize the ballooning debt.

The IMF has been very successful in keeping third world nations on their knees serving to keep corporations and world bankers wealthy at the expense of their people, what makes anyone think they cannot do the same here?
It's not just now recognizing this. It's always known it. It's just that there's recently been a wholesale subscription to Keynesian economics on a level that previously didn't exist. And it's not even Keynesian economics. Even Keynesian economics always recognized that it was detrimental to just create massive amounts of credit and binge on deficit spending. It's just that under Keynesian economics it was considered better to do overall harm across business cycles to smooth them out.

Whenever you hear something like "austerity causing economies to decline" or whatever, that's not really the whole picture even according to Keynesian economics. Even Keynes knew you had to pay the piper eventually. It's just his policy was one of doing overall harm to the economy across several business cycles to smooth out the lumps.

But policy makers operate on election cycles, which generally shorter than any one economic cycle, so they don't care. They'll send the country to hell in a hand basket if it means getting reelected. Ultimately, the buck stops at the voters. The only reason the policy makers have any reason to behave the way they do is that we're as a nation selfish and shortsighted. We elect the politicians we want. There's sort of a shift in that with the Tea Party (ignoring all the religious garbage that's tacked onto it) which is encouraging.
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Old 11-06-2013, 10:13 AM
 
Location: Vallejo
21,700 posts, read 24,920,758 times
Reputation: 18970
Quote:
Originally Posted by PedroMartinez View Post
ROFLMAO!!!

Try telling a business owner that the taxes they pay are not a burden.

If I own a business, and my profit is $60,000 and I have to pay (hypothetically) $15,000 of taxes, that's not a burden? Really?

BTW, you might want to contact the CEO of the corporation I work for and tell him that he should not make any of his decisions regarding opening more facilities or investing in additional R&D based upon profit. The idiot actually seems to think it matters. You need to correct him (and probably every other CEO out there as well).
Yeah, it's like saying that taxes aren't a burden on a household. After all, taxes are only assessed on income a household generates. They even generally don't tax a hefty chunk of your earnings through a myriad of ridiculously complex measures. All that means is that about half of households in the US don't pay any federal income taxes at all. So yeah, for the half of the country that doesn't pay federal income taxes, they aren't a burden.
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Old 11-06-2013, 10:19 AM
 
Location: Long Island, NY
19,792 posts, read 13,907,902 times
Reputation: 5661
Quote:
Originally Posted by PedroMartinez View Post
ROFLMAO!!!

Try telling a business owner that the taxes they pay are not a burden.

If I own a business, and my profit is $60,000 and I have to pay (hypothetically) $15,000 of taxes, that's not a burden? Really?

BTW, you might want to contact the CEO of the corporation I work for and tell him that he should not make any of his decisions regarding opening more facilities or investing in additional R&D based upon profit. The idiot actually seems to think it matters. You need to correct him (and probably every other CEO out there as well).
What I believe celcius was describing is that taxes are not hindering business investment, which is true. Businesses invest to make a return on their investment. Until taxes become confiscatory, taxes are not a consideration to invest or not invest. U.S. taxes are not confiscatory. Thus, lowering taxes does not encourage businesses to invest.
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Old 11-06-2013, 10:34 AM
 
Location: Vallejo
21,700 posts, read 24,920,758 times
Reputation: 18970
Quote:
Originally Posted by MTAtech View Post
What I believe celcius was describing is that taxes are not hindering business investment, which is true. Businesses invest to make a return on their investment. Until taxes become confiscatory, taxes are not a consideration to invest or not invest. U.S. taxes are not confiscatory. Thus, lowering taxes does not encourage businesses to invest.
So if you had the choice of investing in Ireland, corporate tax rate 0%, and the US, corporate tax rate 35%, all things else being equally, you'd invest in the US? Is that what you're saying? That might be true for you, but it's not true in reality. Apple invested in Ireland because for the facet of business it put there, Ireland collects no income taxes. Those are jobs that could be in the US with US workers paying income taxes and sales taxes. Now, maybe you can't compete with 0%. You have to draw a line somewhere. The problem is the US corporate tax rate is very high. That's offset to some degree by the fact that we have an extraordinarily complex tax code that means a lot of income isn't subject to being taxed. That might work okay for Fortune 1000 companies, provided you don't mind the hundreds of millions spent just paying taxes annually in this country.
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