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The fiscal cliff, cutting social safety nets, etc. [View All]

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No Elephants Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-28-12 01:17 AM
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The fiscal cliff, cutting social safety nets, etc.
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Edited on Wed Nov-28-12 01:35 AM by No Elephants
1. A good economy yields an even better economy: Even if you don't raise taxes at all, people in a good economy make more and therefore pay more in taxes, giving the government more money to pay down deficits.

2. Our economy is consumer-driven, especially since the 1% has offshored most production. If people in the U.S. are not buying, there is even less reason to create jobs in the U.S. to fill demand because demand is little to none.

4. Cutting Medicare is just the same as cutting Social Security. Consumers don't care if they have less money in their right pocket or less in their left pocket. Less money is less money, period.

3. Potential consumers who have no money and no confidence that they will have more money do squat for our consumer-driven economy.

5. Ergo, cutting social safety nets will not improve the economy, create jobs for U.S. workers or help pay down the deficit. Neither will forcing lower income people out of their homes by eliminating the mortgage deduction. All of that will only make people with low incomes spend even less.


But, small business creates jobs and small business needs tax cuts.

Um, did you read the first part of this post?

Besides the government definition of "small business" includes some pretty large businesses, the very folk who busted unions, then offshored jobs anyway. And, we're talking about individual income taxes here, not taxes on businesses.

False, no elephants. You are so overlooking Subchapter S corporations. Their profits get passed through to stockholders.

No, I am not.

1. The number of Subchapter S corporations is not large and therefore not all that significant.

2. Taxpayers chose the form in which they do business. The choice of Subchapter S is usually driven by a combination of limited liability and tax considerations. If owners of Subchapter S corporations feel disaadvantaged by their choice of Subchapter S status, nothing at all prevents them from making another choice. They can become conventional corporations as fast as they can get the paperwork to the State House. With a good set of forms and a fax machine, it can take an hour. If their state house does not accept faxes, they can hand deliver or, for about five bucks, expedited USPS.

3. A Subchapter S corporation, just like a sole proprietorship (technically a one person owner who has not incorporated at all), gets to deduct every single operating expense, from the biggest payroll down to the last pencil, before anything is considered profit.

4. There is no reason on earth why we should we treat an individual getting $250K a year in pure profit any differently from someone getting $250K a year in salary.

Either way, the individual is getting $250K a year to spend on himself or herself and is not taking away from money to pay payroll.

5. Besides, Subchapter S corporations have supposedly been enjoying the tax cuts for 12 years now. How's that been working for them or for the country? Or for anyone?

Bottom line: Short of a tax rate that is at least 80% or more, anyone who has an opportunity to make more money by hiring people and still refuses to make more money is probably not operating on the basis of dollars and cents.

Whether the unstated agenda is union busting or getting the government to change laws or whatever, rest assured, there is an unstated agenda.
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