That can work. Raising the zero bracket also works.
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âThe GOPâs New Clothesâ
[Iâd post a photo, but the thought of looking at a bunch of naked pols right after breakfastâŚurp]
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Itâs a fairly simple fact of economics. Low taxes on the very wealthy leads to high wealth inequality because the very rich get to keep more of their money. High wealth inequality leads to negative economic growth because the very wealthy donât put their additional money back into the economy; they ship it to the Cayman Islands or Switzerland and use it for keeping score. An expanding economy requires demand. Demand is created when people have money they want or need to spend. Making the rich richer does not grow the economy. This was proved in 1929 and again in 2008. Even the Pope has figured this out.
This can be seen from the following two charts which illustrate income inequality and top marginal tax rates in historical perspective.
Â
Â
While correlation does not prove causation, repetitive instances of the same correlation do tend to strengthen an argument.
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I guess I could be okay in assuming that tax cuts could spur some modest growth, but the effect, as always is nowhere close to their estimates. On Marketplace two days ago, some House GOPer (canât remember the name) cited some bull-shit right wing pro-tax âthink tankâ estimate that said the tax cut would generate a 9% growth rate. That is INSANE. It never got that high during the dot-com bubble. I donât think the US has ever had a sustained growth rate that highâcertainly not in recent times (meaning since 1950). It may have for a few quarters, but not much more than that. I wonder if that is the sort of crazy projection that is needed to make it ârevenue neutralâ
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This idea sounds kind of logical. The trouble with it is- it doesnât work. It has never worked. And itâs not going to work. Taxes on a national level are difficult. Iâm sorry, but they are. I can see the desire to simplify, to make more fair. OK. But cutting taxes on Mega Giant Corp. and itâs wealthy owners will make them wealthier and leave the rest of us with the weeds. Thatâs reality.
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They donât. Weâve been fed the lie for years.
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Hereâs the thing: because of the way that economic stimulus depends on re-spending, tax cuts for the poor and the middle class will always generate more economic activity than tax cuts for the rich. Rich people get a tax cut, they sit on it (sometimes they invest it in derivatives). Poor people get a tax cut, they spend it at places that turn around and spend it again and so forth.
But it gets even worse than that. Tax cuts are supposed to be balanced by government spending cuts, and most government spending goes ultimately to people who are middle class or poor. Transfer payments, of course, but all those government employees and all the employees of government contractors. So when you give a tax cut to the rich, you get negligible economic stimulus from the added money in the hands of people who donât spend it, and you get substantial anti-stimulus from the reduced money in the hands of people who do spend it. (Plus a lot of extra pain and suffering, which is usually a feature in the republican plans.)
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Youâd think, just once, that someone from the media would ask a Republican politician to provide an example of a previous tax cut that has paid for itself.
Just ask them for one example. Canât be too hard, right?
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Remember when America was âgreatâ, as defined by those Rust Belters who handed Trump the White House? It was in the 50s and 60s. Civil rights and the Cold War aside, upward mobility was still a thing for the working class and a factory job got you into the middle class and home ownership. I wonder what taxation looked like back then? Oh, hey, look here! Top income rates were much higher and unions were strong!
Shit, if only there were a party that valued labor and sought increased taxation on wealthier earners⌠Oh well, Iâll just keep voting for Republicans because they like guns!
[/snark]
In all seriousness though, fuck Laffer and fuck anybody who ever bought into that shit. I hope Reagan is writhing in hell right about now.
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Trickle downâŚmy butt!
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@machoneman Eeeeeeewww, I just finished breakfast.
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Trump didnât write it.
It was ghost-written for him, and the real author regrets having done it.
Trump couldnât write a simple declarative sentence.
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Things that make pass-through unworkable for corps trading publicly:
âlots of share trading
âinstitutional shareholders
ânon-US shareholders
âshares held in tax-advantaged accounts
etc.
The factors above, and others, make it difficult to allocate the taxable profits, to determine the tax liability of shareholders, and to collect taxes for the US Treasury. There is the added problem of shareholders incurring tax liability, but not receiving cash to cover that liability.
Net losses would mean allocation of losses, too. Thatâs another mess.
Also, the allocation of taxable income to individuals would require many more people to file quarterly estimated taxes.
Pass-through is okay in theory, but a mess if implemented.
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Nice graph. You canât deny that the rate of GDP growth (slope of blue line) increased coincidental with lower income tax rate. Causation is implied, but not proven, as many other factors could be charted to show coincidence. For example, the emergence of information technology, perhaps shown as internet traffic counts. All such factors acting together might be causative, but to what degree? Impossible to prove. The temporary setback 2007-2009 can be pinned to specific causes that have little to do with taxation, for which the guilty escaped punishment.
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Hate to say but how could anyone tell? Iâm not trying to pick on LA but you guys are the âwhole another countryâ that Texas stole from you guys.
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Yeah, and the real author basically said the same thing: Drumpfie knows how to intimidate, not negotiate.
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No surprise here. Everyone knew he was going to announce something that would be impossible to pass. Heâs blowing hot air and is once again controlling the media hour by hour.
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USA meet Kansas. Kansas meet USA. I have a feeling that youâre going to have a lot in common with one another.
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No wall, no travel ban, no tax plan, no sanctuary city funding ban, no obamacare repeal, no Mike Flynn, chaos in the White House. The list of Trumpâs accomplishments is stunning.
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I hope everybody has their forms ready to become pass-through entities. Donnie & family are well ahead of the curve on that front.
@lizzymom He blusters and then he folds like the cheap suits he wears. Itâs his cowardice that will inflict the most damage on the US, and I hope whoever runs in 2020 calls him out for the yellow-bellied squealer he is.
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