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The man has not even taken office yet. Geez, can we at least give him a chance to screw things up before we all turn into monkeys flinging our poo at him?
I mean really, to all of the Obama haters, do you really think things are going so well right now? Republicans had their chance for 8 years and they've done a helluva job. On what planet is 700 billion being fiscally conservative?
Also if anyone living anywhere in the US really thinks that 250k a year is not that much money, then you are so far removed from how the average person lives, I just don't know what to say. I will say that you can pay me 250k a year and I will gladly pay more taxes.
I believe the higher tax rate will only apply to the amount over $250,000. So if you make $260,000 you'll be taxed $35% on the $250,000 and 39% on the other $10,000. If you're one of those people right on the cusp it's not as dire as people are making it out to be. It really only hits hard those people making way above the $250,000.
The last sentence of this is spot-on but the rest actually understates how minimal the effect will be for most people.
First, all the tax rates in the federal system are marginal. You would not pay 35% on all taxable income up to $250,000. Instead, you'd pay the various lower rates on the taxable income up to the cap for each rate.
Second, and this is key, the top rate would kick in only for income above $250,000 of taxable income. By the time many high-income residents of regions like NOVA are done deducting 401(k) contributions, 529 contributions, charitable contributions, relatively high levels of mortgage interest and local taxes, student loan interest, etc., the gross income would have to be about $300,000 to come anywhere near a taxable income of $260,000. Even if it did, a four percent increase on $10,000 worth of income is a tax increase of $400. If you're making $260,000 after all relevant deductions, you can swing it. I know this because this year, after years of earning hardly anything, I'm actually in the situation. And remember that, in 2005, households earning more than $250,000 (before the deductions) only made up 1.5% of the nation.
Someone pointed out that the highest rate was 39.6% until 2001, 50% from 1982-86, 70% or from 1964-81, and over 90% (at very high income levels) from 1944 to 1963 or so. The interesting thing is that, not only did the economy not collapse during those periods, it actually did collapse when high earners were taxed at a lower rate. In the 90 years since 1918, only for about 20 of them was the top personal income tax rate lower than what Obama has proposed: 1925-32, 1987-92, and 2002-08. What do these periods have in common? Laissez-faire economic ideology, a stock market crash, and the onset of a depression or severe recession.
Given the Bush deficits and all the work that needs to be done in this country, it would be irresponsible not to raise taxes somewhere. And the plan proposed is so far from a radical departure from past US practice that it's very hard to justify the hyperbole being thrown about. The idea that there was some sort of pure free market United States until now, that this model somehow worked, and that the election of Barack Obama marks a turn to an alien socialist economy is pretty laughable.
The thing that is a bit alien about Obama's plan is not that he wants to raise taxes. He's a Democrat, that's what they do.
The thing that seems a bit unusual (and socialist) about Obama's plan is that he wants to tax "the rich" and then give out tax "refund" checks to lower/middle income people - ie "share the wealth."
Right now, "the rich" are defined (arbitrarily) as those making 250K+. But once you open that door.... why not 200K, 150K, 100K or even 80K?
At any rate, it will be interesting to see the details of his plan and how it will impact various income levels.
springfieldva, I do think that the way the tax hike is being explained is not in the best manner and it does sound very "Robin Hood". However, I like to think of it as giving back to the lower/middle class after having 8 years of Bush. We all know as soon as Bush came into office, the wealthy got a nice tax cut. Funny how taxes are socialist when they are coming from the paychecks of the wealthy but not the lower/middle class. Funny how the Republicans didn't give a rat's behind about the middle class paying more taxes over the past 8 years. Funny how the Republicans don't seem a fraction as angry over the corporate welfare we are experiencing right now with people walking away from dying companies with their millions of dollars in "bonuses". Why doesn't that get their panties in a twist? I'm supposed to care about Joe Millionaire paying more money in taxes? Somebody bring me my violin.
When I worked for minimum wage in college, I was working full time for $5 an hour. My 40 hour work week check came to a whopping $200. Out of that $200, $50 of it went to taxes. Now, we bring in six figures. Of course we pay way more in taxes now. However, as much as I'm paying now, it still does not sting near as much as it did when I had to pay that $50 every week. THAT hurt. Now? Not so much.
So yeah, I get it that rich people pay much more in taxes. But let's face it, the more you make the less it hurts. Remember that Friends episode where Rachel and the other girl were in love with Ross and Ross was complaining about how hard it was having two women in love with him? Chandlers reply was " yeah and my wallet won't close from all of these $50's and my diamond shoes are too tight." Well to this day, whenever someone is whining over something that really isn't THAT much of a problem, (you know like celebrities complaining about people taking their picture), my husband and I will respond with "Are your diamond shoes too tight?"
That is how I feel now hearing the wealthy whine about having to pay more in taxes. As Holden125 pointed out (thank you btw) so clearly, a person will have to be making WAY over the 250k, 200k whatever amount for it to even effect them. And as much as I hate the way many poor people have figured out how to work the system for welfare, let's face it, the rich have the monopoly on figuring out ways to NOT pay taxes. By the time they are done with their deductions including their beach and lake houses, and their company Hummers, you watch and see how many people will conveniently be making just under the magic number.
Paying taxes sucks for everybody. Not just the wealthy.
The thing that is a bit alien about Obama's plan is not that he wants to raise taxes. He's a Democrat, that's what they do.
The thing that seems a bit unusual (and socialist) about Obama's plan is that he wants to tax "the rich" and then give out tax "refund" checks to lower/middle income people - ie "share the wealth."
Right now, "the rich" are defined (arbitrarily) as those making 250K+. But once you open that door.... why not 200K, 150K, 100K or even 80K?
At any rate, it will be interesting to see the details of his plan and how it will impact various income levels.
A couple of responses.
First, the fact is that anyone who has a tax bill to pay could point to anyone getting any of these net refunds and say "I'm paying for that, they're taking my tax payment and giving it to those people." The Obama plan is perceived as radical because there is a proposed tax increase on the top 1.5% of American households at the same time others get a net refund. But my federal taxes were already something like $50,000 last year. If he gave out the rebates to people who don't have federal tax liability while NOT raising taxes on high earners, it would be the same difference. Either way, the government would be getting the money for this from those who pay.
It's not so radical either. The stimulus plan in February, which almost all Senators (including John McCain) supported, gave people $300 or $600 regardless of their actual tax liability. I did not get any rebate since I make too much now. A year or two ago, I would have qualified. The principle is the same: people who have higher incomes had to pay, and people who had no federal tax liability got a check, in cash. The idea was to give money to those who would spend it because they don't have much, and thereby stimulate demand and improve the economy. I don't recall any one saying that was socialist. I also don't recall anyone saying that Senator McCain's proposal during the campaign to give a $5,000 tax credit, ostensibly to buy health insurance but theoretically capable of being used for anything from vacation to a used car, was socialist, though that would also go to people who didn't actually have federal tax liability either. And as for socialist, how about $700 billion for financial institutions that gambled and lost?
As in February, the idea is to stimulate demand, which is very low as people are afraid and have less money to blow, and that is best done not by giving a tax cut to me, since I'll save the money, but to people who are more likely to spend it when they get their hands on some extra cash. I don't mind this, though I'm one of the ones who's paying.
Secondly, the "share the wealth" comment has been blown all out of proportion. There are two ways to do this: (1) bluntly, taxing me and giving to someone poorer, and (2) creating more equitable labor market conditions. There's been a lot of focus on Obama's plan to do (1), which I think is way overblown. The bigger issue is (2). That would be far from radical, that would be nothing more than a return to the America that existed in the 1940's, 50's and 60's. From 1932 to 1973 income rose significantly for all sectors of American life, from richest to poorest. Since 1973, we've had a thirty-five year period in which those at the top are making out like bandits while more than 60% of American households have lower income, after inflation, than they did in 1973. The whole economy does better with a more equitable distribution because people are free to spend. The decline of many households is hidden by the facts that (1) we've had huge productivity and technological gains in that time, so a smaller piece of a much bigger pie seems like an improved standard of living; and (2) people have spent like sailors thanks to easy access to credit cards with high interest rates and borrowing against home values in a housing bubble. Take those conditions away, throw in some rising unemployment, and you won't see much spending unless we "spread the wealth around" a lot better.
There is a lot of economic history written about the late 1800's, when inequality in incomes led to the accumulation of enough capital in the hands of the wealthy to invest and create the industrial machinery that made the nation's economic output huge (though conditions in those factories stunk). This is the essence of Reagan supply-side economics. Let the wealthiest keep huge piles of money, they will invest and generate jobs for the rest of the people. Look around and see what happens to this theory today. The rich accumulate money to invest, and they dump it into worthless pieces of paper that are backed by risky mortgages sold and resold until they're not recognizable. One day they wake up and all that wealth has vanished and nobody wants to give credit to anyone anymore. Investment in recent years has not been about getting Americans to work, it's been about shell games with complicated financial derivatives.
Digging up an old thread on purpose- so is/was Obama the magical elixir? I only see party members distancing themselves from him and he has done nothing to our country/economy etc,
Digging up an old thread on purpose- so is/was Obama the magical elixir? I only see party members distancing themselves from him and he has done nothing to our country/economy etc,
After yet another GOP debate last night, President Obama has nothing to worry about. It's obvious that the Republicans didn't have any answers during Bush's two terms, and their candidates don't have a clue now.
About the President not doing anything for the economy, his superior efforts have been halted by the GOP tea party-learning House. The GOP has broken Congress, insisting on more Bush solutions to an economy that the GOP broke using Bush solutions. Hard for the country to get out of the Bush hole, when the people who put us there are doing everything in their power to keep us there so they can use deceptive marketing to blame it on the President.
The blame, the outrage being expressed, the failures of the economy, and failures in general, are the direct result of the GOP. President Obama showed what he can do when not hampered by the regressive obstructionists in finding and killing bin Laden. No doubt he would have similar success in all matters domestic and foreign, were it not for the GOP intent on making him fail. Quite pathetic, the GOP, but it won't stop President Obama from getting his second term.
After yet another GOP debate last night, President Obama has nothing to worry about. It's obvious that the Republicans didn't have any answers during Bush's two terms, and their candidates don't have a clue now.
About the President not doing anything for the economy, his superior efforts have been halted by the GOP tea party-learning House. The GOP has broken Congress, insisting on more Bush solutions to an economy that the GOP broke using Bush solutions. Hard for the country to get out of the Bush hole, when the people who put us there are doing everything in their power to keep us there so they can use deceptive marketing to blame it on the President.
The blame, the outrage being expressed, the failures of the economy, and failures in general, are the direct result of the GOP. President Obama showed what he can do when not hampered by the regressive obstructionists in finding and killing bin Laden. No doubt he would have similar success in all matters domestic and foreign, were it not for the GOP intent on making him fail. Quite pathetic, the GOP, but it won't stop President Obama from getting his second term.
LOL - Love when Dems play the blame game, its hilarious.
P.S. Obama nor his cabinet found and killed Bin Laden, please thank our Intellegence Community and Military leaders.
Digging up an old thread on purpose- so is/was Obama the magical elixir? I only see party members distancing themselves from him and he has done nothing to our country/economy etc,
I suspect we'll be shut down pretty quick, but what are the Republicans offering that isn't a retread from before (e.g. cut taxes, cut regulations, etc.)
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Nope
Hard for the country to get out of the Bush hole, when the people who put us there are doing everything in their power to keep us there so they can use deceptive marketing to blame it on the President.
