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The interviening step was the printing of $7 trillion by foreign central banks and the use of that money to buy debt in the US with. MBS Mortgage-backed security - Wikipedia, the free encyclopedia The carry trade, the printed money. It goes away with a high enough tax rate on the top end. You need a low tax rate to profit from the carry trade. Without the profit from the carry trade you don't get bubbles. Without being able to profit from borrowing money and buying debt internments with it you don't do it. You can't legislate bubbles. you have to invest in them to get them to grow.
How is the U.S. going to tax the foreign investors that bought the fraudulently misrepresented GSE MBS's? Remember this?
The CRA housing bubble and bailout were indeed legislated. Politicians panicked when the bubble burst and used taxpayer money to make foreign investors whole.
Abyone who gets a wage income that is reported on a W2 form has Federal and State taxes withheld by the employer Data plus the withheld icome is given to the IRS. The employee has to file a 1040 form to show which exclusions he has and whether he has had more taxes withheld than the government is legally entitled. This money is your refund. Depending on the number of exclusions you might get nearly all of your money back. Everybody who has wage inclome payes taxes under compulsion of law, saying they don't is Republican b bilge.
Having money withheld that you get back later is not the same as paying taxes. And if you if you predict your end-of-year federal tax liability to be zero, you do have the option of reducing your federal withholdings to zero. So not only is your premise wrong, you're technically wrong too.
We live in the era of a ponzi scheming government. A dollar only changes hands 2.7 times before the fed owns it again, yet we are still the most debted nation on earth.
Even if we get a flat tax installed... how long will it be before the political class find a way to raise it? 9-9-9 will be 12-12-12 in no time. Then they'll bastardize that into a graduated flat tax somehow. Anything in the "luxury" threshold will be 15%, 20%, or more. Our tax structure sucks, but it's the people in charge of it that suck the most. No amount of tax restructuring will fix anything as long as the same people are running the show.
The Kings (political class) are definately wearing robes, and have plenty of gold socked away from raiding the treasury year after year.
We live in the era of a ponzi scheming government. A dollar only changes hands 2.7 times before the fed owns it again, yet we are still the most debted nation on earth.
Even if we get a flat tax installed... how long will it be before the political class find a way to raise it? 9-9-9 will be 12-12-12 in no time. Then they'll bastardize that into a graduated flat tax somehow. Anything in the "luxury" threshold will be 15%, 20%, or more. Our tax structure sucks, but it's the people in charge of it that suck the most. No amount of tax restructuring will fix anything as long as the same people are running the show.
The Kings (political class) are definately wearing robes, and have plenty of gold socked away from raiding the treasury year after year.
That's exactly the problem with VAT. At, say, 6% it sounds somewhat reasonable to many people. But it's far easier, politically, to raise VAT than IT. Didn't the UK just ratchet theirs up again, from 18% to 20% I think?
How so? Only 49% pay FIT whereas everyone would pay VAT. Seems to me more people would fight against increasing a VAT than the FIT that only 49% pay.
I guess for the same reason that a state finds it politically easier to jack up the sales tax rate than the income tax rate (or to impose an IT where none existed before). But then, I don't think 49% escape state income taxes...
But that's just speculation on my part - far be it from me to claim that I understand the psychology of sky-high European tax rates...
How so? Only 49% pay FIT whereas everyone would pay VAT. Seems to me more people would fight against increasing a VAT than the FIT that only 49% pay.
Use energy taxes as an example. I live in Cali and just got last months electric bill, which includes nearly $200 in additional taxes that didn't exist before Davis and the Enron fiasco.
How about $118 conservation incentive <<that's more than my auto insurance. And it goes to companies like Solyndra!!! I'm paying $120 a month to some private land owner to put up a wind generator
When you attach a tax to something, and the tax and spenders need more cash, the first thing they'll do is raise those taxes to meet THEIR NEEDS, not yours.
Reality FAIL. There is NO historical evidence anywhere that cost reductions lead to lower rents.
In California, Proposition 13 slashed property taxes an average of 57 percent, but rents did not fall, and angry renters succeeded in passing a number of local rent control ordinances.
In Massachusetts and Michigan, large property tax cuts did not result in lower rents.
Rent reductions, like all price reductions, require a first mover. Small landlords cannot be the first to lower rents, since they are already renting at full occupancy (they need to keep their units fully rented to avoid negative cash flow). Large landlords already have optimized rents and vacancy rates - they maximize profit at a non-zero vacancy rate - and have no reason to lower rents unless vacancy rates rise to undesirable levels. Since nobody has a reason to be the first to reduce rents, nobody does.
There is no reality fail. Truth fail on your part. Property taxes were not lowered. There was a cap put on the increase.
Proposition 13 made less houses available, which is less competition, therefore rent stayed high. If demand is greater than supply prices go up. This explains why renters in California do not like proposition 13 and home owners do.
Increased on property tax were limited to 2 percent a year but when the house was sold the property tax was on the full value. Less homes changing hands, less turnover means less competition. Prices stay higher with less competition.
Why would a home owner move from a similar priced house to another if the property taxes are going to rise? If the house was sold there is the possibility it would be a rental. Since that house will not be sold there is a zero percent chance it will be a rental.
Instead of buying the same value house and moving closer to work and thereby saving money people have less incentive to do so. The property tax on the same type house is more expensive. Why save 50 a month in gas if your property taxes go up more than that per month?
Use energy taxes as an example. I live in Cali and just got last months electric bill, which includes nearly $200 in additional taxes that didn't exist before Davis and the Enron fiasco.
How about $118 conservation incentive <<that's more than my auto insurance. And it goes to companies like Solyndra!!! I'm paying $120 a month to some private land owner to put up a wind generator
When you attach a tax to something, and the tax and spenders need more cash, the first thing they'll do is raise those taxes to meet THEIR NEEDS, not yours.
Why do constituents put up with that?
Everyone needs to stop being tax doormats, especially those who are paying taxes that others aren't like only the 49% of earners who pay FIT.
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Having money withheld that you get back later is not the same as paying taxes. And if you if you predict your end-of-year federal tax liability to be zero, you do have the option of reducing your federal withholdings to zero. So not only is your premise wrong, you're technically wrong too.
