Please justify holding hostage $13 billion of UE benefits VS $700 billion tax break for wealthy

Oh, you know the answer you are going to get.

-People will get jobs if they get off the government dole.

-If you tax rich people, they won't invest their money and there won't be any jobs

-Jobless people are scum and deserve to suffer

-Rich people are more productive and should live like kings

yeah, i expect these answers, but when faced with the raw numbers, and how 98% of the population benefits from holding middle tax cuts in place letting the other expire, i wonder how the morality can be logically argued taht it is appropriate and necessary that this negotiation stance be taken.13 billion VS 700 billion.a. the hypocrisy abound deficit reduction and funding is astoundingb. the human misery caused borderline criminal and surely cruel (people making $200/250K are not suffering the way someone is living on $200/week (and then they have that taken away)i think many forget that people want to work. however, older people do have a harder time finding work. if you live in a rural area it might be close to impossible to find work. etc. moreover, there is no trickle effect for these people, and historically little elsewhere.so, i remain curious. how is this morally justified. is it Ayn Rand? Is any conservative willing to admit that they simply can't have enough and that greed is their only morality?

Precious Roy wrote:

Oh, you know the answer you are going to get.

-People will get jobs if they get off the government dole.

-If you tax rich people, they won't invest their money and there won't be any jobs

-Jobless people are scum and deserve to suffer

-Rich people are more productive and should live like kings

Well the Dems are asking for over 3 trillion in tax breaks for the middle class, but that 700 billion is going to kill us? The Repubs are fine with the middle class break, they just want to include upper income people. You may not like it, but that is the fact.

They are both playing hardball, if the Repubs didn\'t do it they would just get walked on. Same for Dems, it works both ways. It is a messy and I don\'t like the way they do it. You just are picking your team, but the same points could be made on the other.

The UE benefits are part of this process. They are both playing chicken with it. Only solution is for some real bipartisanism to enter the fray, in the absence of that playing chicken is the process. Sure your team is great, and mine sucks. Feel better?

okay that's fair and we can see through things. the problem is the dishonesty and frankly, the willingness to toy with people's livelihoods.the dishonesty whips up Beck crowd into a frenzy. the poor sods even end up going against their own interests since they don't know better. in other words, the way an argument is disclosed matters in determining the quality of political conversation in this country.then the playing with people's livelihoods: 13 billion is a minor expenditure compared to the 3 trillion you mentioned, 1/3 of 1% leaving 99.67% left over, more or less. meanwhile, 2 million people really are looking at eviction, no food on the table, medication decisions, etc. again, our politics have lost their focus of serving the people.so, your 'argument, that this is the process, while true, does not answer the question about morality. it's probably a moot discussion since messy negotiations are never going to end, but the lying should stop. the focus on better outcomes for greedy parties should stop. improved outcomes for the average person should be the priority of elected officials.

When Obama and the Dems talked about Bush's tax cuts, they all talked as if they were JUST rich tax cuts, only recently when the taxes were expiring did they say they wanted to keep the ones for the middle class. These middle class cuts were a secret BEFORE, now we find they were 75% of Bush's tax cuts. This was very disingenuous on the part of the Dems, so again I think you are picking points for your team, but dismissing the point on the other side.

The reason the tax cuts were more for the middle class is that where much of the money is. You can't reasonably tax the rich out of our problems, everyone is going to have to make some sort of sacrifice. The rich tax cuts are a read herring and are muting the real discussion.

I think in this time unemployment benefits should be extended, and I am betting in the long run they will.

I understand both sides are playing politics but personally don't want to link the two.

For unemployment benefits, it is easy for me to think of this as just the insurance program that it is supposed to be done as. The premiums are based off of a six month term of benefits. Anything else is in no way earned or paid for. Anything past the six month benefit period is welfare.

53 Seconds Off Any Pace wrote:

The argument is being made that there isn't money to pay for:

$13 billion of unemployment benefits affecting 2 million people

but there is money for $700 billion (that is unfunded) benefiting mostly millionaires and even some billionaires

Reagan's own people and other conservatives have said unemployment benefits are more stimulative

How is it that conservatives are able to morally justify this?

I really am curious.

I don't speak for Reagan, but it's like this: millionaires and billionaires are not liabilities on the national balance sheet like unemployment benefits. A tax cut is not a gift, but merely the cessation of confiscation. To equate tax cuts to handouts to the rich assumes that all money is collectively owned, which is a socialist notion.

You are also saying ONE side is greedy, or are you saying both sides are? Of course greedy is a loaded term. I think you mean the rich for not wanting to pay even more towards the huge benefit system. I think maybe those that don't pay any taxes and want many, many benefits may be as greedy.

As for the rich, they aren't the problem, I do not like the uneven income distribution, but think the issue is much more nuanced than could be handled here.

That $700 billion is a wholly mythical number that indicates tax receipts projected presuming no change in behavior in response to the higher tax rates. The correct number is below zero, since higher tax rates on capital gains nearly always result in less revenues, not more revenues, as taxpayers move their investments to tax free categories (municipal bonds, money losing businesses). The reduction in capital gains rates in the late 1990s resulted in a near tripling of receipts, as executive income shifted from salaries to options and equities.

Higher tax rates do not redistribute income; they redistribute taxpayers from taxable to untaxable activities, from offices to golf courses, from productive investment to real estate speculation, from the U.S. to off shore. Higher tax rates do not stop you from being rich (if you are already rich you can always figure out ways to shelter and reshuffle your holdings). Higher tax rates stop you from getting rich by expanding your business and creating jobs.

steve22222 wrote:

When Obama and the Dems talked about Bush's tax cuts, they all talked as if they were JUST rich tax cuts, only recently when the taxes were expiring did they say they wanted to keep the ones for the middle class. These middle class cuts were a secret BEFORE, now we find they were 75% of Bush's tax cuts. This was very disingenuous on the part of the Dems, so again I think you are picking points for your team, but dismissing the point on the other side.

The reason the tax cuts were more for the middle class is that where much of the money is. You can't reasonably tax the rich out of our problems, everyone is going to have to make some sort of sacrifice. The rich tax cuts are a read herring and are muting the real discussion.

You are exaggerating for "your team" (oh, let me guess, you are the last objective person in america and "above the fray." Nope)

The dems said that the Bush tax cuts were "for the rich" BECAUSE.....drum roll...

That is the group that got by far the largest cut, while middle class people didn't get that much individually:

" In 2007, the 0.3 percent of households with incomes above $1 million received about $120,000, on average, from the 2001 and 2003 tax cuts, according to estimates by the Urban Institute-Brookings Institution Tax Policy Center. In contrast, households in the middle of the income spectrum received tax cuts averaging $740. "

You see that? These are people already waaaaay better off that most americans, and they received a tax cut that was over 150 times more than middle class folks. Yes, that = TAX CUT FOR THE RICH (oh, and by the way, Bush had to be pushed into many of the tax cuts that were given to the middle class in the end. His main focus was on the cuts for the rich).

As you point out, of course overall there were more total tax cuts given to the 99% of the people in the lower income brackets, but it was the top 1%, or even .3%, who really made out like bandits. Yes, the people who LEAST needed a big tax break.

And the dems, just like republicans like Alan Greenspan and Reagan budget director David Stockman, would most likely gladly pull the plug on most of the Bush tax cuts if they thought that it could politically fly. But when you see the insanity of republicans fighting to the death to continue huge, unpaid tax cuts for millionaires, obviously they know the reality is that it would be impossible to even go down that road. So they decided to do what seemed like the most logical thing and rescind the tax cuts on those who least need it and would least likely spend it: those making more than $250,000. And yes, that would certainly help with the deficit. But for republicans, fighting for the rich is always their highest priority.

David Stockman, Reagan's budget director and supply side champion:

He concedes — as he and Reagan once argued — that raising taxes might curb some economic activity and result in lower tax revenues in the short term. “If you raise taxes on paper by $100 billion, maybe you’ll get $90 billion or $85 billion,” he said. “But it’s just common-sense fact that when you raise the rates, you get more revenue."

And there's nothing "mythical" about the fact that gov't revenues went down after the Bush tax cuts, and the economy didn't create jobs.

The solution is simple.

Eliminate the Income Tax.

Problem solved.

The Repubs are for lower taxes for EVERYBODY, not just the rich. Of course because the rich pay a bigger share of the taxes, when you cut, they benefit more. So anytime you want to lower taxes for everyone the Dems say it is for the rich exclusively when that is not the case.

That being said, lower taxes only work when the taxes pay the bills. The problem is people want the benefits but don't want to pay for them. I realize the spending has been on both sides. The 4% is a red herring and you throwing up the rhetoric just highlights it. Keep blaming the rich and you won't solve anything.

steve22222 wrote:

Well the Dems are asking for over 3 trillion in tax breaks for the middle class, but that 700 billion is going to kill us? The Repubs are fine with the middle class break, they just want to include upper income people. You may not like it, but that is the fact.

this is not true. the $3 trillion dollar number will still mostly go to the richest people. if you understand how progressive marginal tax brackets and rates work, then you know that the largest benefit for a tax rate cut for a certain bracket will go to those people who have sufficient income to fill up the entire bracket.

for example, if you cut the tax rate on income between $125,000 and $250,000 from 31% to 28% (simplified income numbers, but very roughly corresponding to the real numbers for married filing jointly), then someone who has taxable income of $135,000 will see a benefit of $300. Before the change, the last $10,000 of income was taxed at a 31% rate - $3,100 - and after it is taxed at 28% - $2,800.

Meanwhile, one who makes $400,000 sees a benefit from that cut that is much larger. the full $125,000 in that bracket is taxed at 28% rather than 31%. A savings of $3,750.

so for every tax bracket below $200,000 for individuals and $250,000 for married couples (and remember this is "taxable income", which is after all deductions and exemptions), the obama plan would most benefit people who have income that completely fills that bracket. in other words, people who have taxable income at or above $200k/$250k receive the largest tax break (at least with respect to rates; there are other items on the table like the child tax credit too).

The numbers have taken that into account.

steve22222 wrote:

The numbers have taken that into account.

i don't understand what you are saying.

my point is that much, if not most, of the $3 trillion number is going to people above the middle class.

you initially said democrats are fine with a cut for the middle class that costs $3 trillion.

help me understand your point if i'm getting it wrong.

What needs to be done is to make the tax code more simple. One person mentioned the effect of raising capital gains taxes actually being a decrease in tax revenue. Here's an idea, tax all types of income equally.

Have your brackets at 20% 30% 40%, whatever, and all income, interest, capital gains, W2 wages, whatever, gets taxed at the bracket your total income qualifies you for.

Here is the other thing about these breaks for the rich, a good portion of "rich people" don't pay taxes at all. I know this because I work in small business lending and see their tax returns. Many small business owners just depreciate the crap out of all their assets, run personal expenses through the business until it takes a "loss" and only pay themselves enough to "scrape buy". Sure, I see people writing six figure tax checks (not literally of course), but I also see people with million dollar incomes who are able to write it down to a loss.

My conclusion about the Republican fears about higher taxes discouraging investment from small business owners is that it's a B.S. contention. There are so many loopholes that encourage investment that it makes tax rates pointless.

The people that are really negatively affected by a tax raise for those earning above $250,000 are doctors, corporate lawyers, and high level professionals at major corporations who earn big W2 wages and have no other "income" that they can write off.

So, the bottom line for me, is that I don't believe raising taxes on the rich will discourage investment, the only way to do that is to close off the loopholes, and that most certainly will not happen.

ggilder wrote:

That $700 billion is a wholly mythical number that indicates tax receipts projected presuming no change in behavior in response to the higher tax rates. The correct number is below zero, since higher tax rates on capital gains nearly always result in less revenues, not more revenues, as taxpayers move their investments to tax free categories (municipal bonds, money losing businesses). The reduction in capital gains rates in the late 1990s resulted in a near tripling of receipts, as executive income shifted from salaries to options and equities.

if we assume that you are correct that lower capital gains taxes resulted in a near tripling of receipts, and that this reflected in part executives being paid in stock options rather than wages (there's a lot to quibble with here, both in terms of the story for why stock options became popular (see code section 162(m)) and in terms of the tax treatment of equity awards), then there was a shift from wages then taxable at a 39.6% federal rate to capital gains, then taxable at 20%. that's obviously a huge revenue loser for the federal government unless the total compensation amount soared.

and if the total compensation amount soared, the free market in that arena was clearly broken, as there would be no reason to suddenly triple an executive's salary because of a beneficial change (to the executive) in tax law.

in any event, much of the $700 billion number has nothing to do with capital gains rates. and municipal bond returns are only very loosely related to capital gains tax rates (bond and savings account interest are more comparable, and they are taxed at ordinary rates, not capital gain rates).

steve22222 wrote:

The Repubs are for lower taxes for EVERYBODY, not just the rich.

Want to know what you get when you lower taxes for everybody without paying for them? You get higher taxes for everybody down the road. I don't think of the Tea Party crowd as being particularly credible on most topics, but I would expect to see a few on this board acknowledge this certainty. Whether Congress preserves half of these tax cuts, or all of them, either way it's a giant budget buster on top of our already considerable budgetary problems. Those against raising the debt limit, or Fed policies that weaken the dollar are dumb as fence-posts if they don't see this as furthering both of those actions. There is no alternative. Any older Americans that value entitlement programs that don't see this legislation as another nail in the coffin for their future benefits are both blind and ignorant. Gobble gobble motherf'ers.