Our financial system is crumbling this week.

[Leroy]

Let's say we remove the payroll tax cap. No problem with me. However, the people that pay more into the system would be then eligible for more benefits because they paid more into the system, so is there really a difference? I mean, then everyone would say 'How come those rich fat cats get so much money from Social Security?'. My sister asked a question that a loan officer raised about a reduction in benefits for her husband, even though he didn't start drawing SS at 66 - his retirement age. The banker was wrong, there is no income limit after you reach 66 (for now). However, his benefits are then taxable depending on their income. Reduce benefits or tax them, what is the difference?

What I'm trying to say, if we want to be serious about this crap, let's get serious.

Edit - I will never defend Bachmann. I think she must be intelligent to be a tax lawyer, but I can't stand her.

[cpebbles]

Sorry if it offends, but that argument is in fact idiotic. It's a willful misrepresentation of Buffet's message that conservatives have been bandying about as an attempt to get a snarky response to that message incorporated into the tax code.

[Leroy]

I don't know if it is any more idiotic than the 'Billionaires and Millionaires and Corporate Jet Owners' argument.

A millionaire or billionaire to me means they made most of their money in prior years. I would think there are very few people that make a billion dollars in a year, if any.

Like I said, I have no problem raising rates or whatever, just explain what it means, and if politicians want to stand in the way, make it so they aren't politicians very long.

[Arthur Dent]

Let's say we remove the payroll tax cap. No problem with me. However, the people that pay more into the system would be then eligible for more benefits because they paid more into the system, so is there really a difference?

A huge one. The tax rate is flat (up to the cap), but the benefits schedule is quite progressive.

[vinsanity]

I will never defend Bachmann. I think she must be intelligent to be a tax lawyer, but I can't stand her.

First, it wasn't about Bachmann as much as the argument. If it's someone you like/support/agree with then it's 'not their fault the system is broken and they'd be stupid not to take advantage of it.' If it's someone you disagree with they are 'a hypocrite trying to get a free ride.'

I mean, then everyone would say 'How come those rich fat cats get so much money from Social Security?'.

The other important thing to remember is the Social Security/Medicare 'taxes' we pay theoretically go in to the Social Security trust to pay for these benefits. So the extra revenues from eliminating the cap would only work to make SS infinitely more solvent. As would raising the retirement age or even reducing benefits for the wealthy. This isn't without precedence with Medicaid programs.

A millionaire or billionaire to me means they made most of their money in prior years. I would think there are very few people that make a billion dollars in a year, if any.

But the Government isn't taxing assets at all, just income from those assets. The tax holes in our codes are insane, but there for good reason as well. Again, Obama proposed a new tax bracket for federal income that would "end the Bush Tax Cuts" for only those making $1M a year. And only by 4% marginally. That means a person making $1M would pay the same rate on their first $1M as someone who made $250k. That 1 millionth dollar would be taxed at 35 cents. The next one after would be taxed at 39 cents. Oh wooooe is the rich.

So when we talk about raising taxes on the super rich we are talking about people who make a million dollars per year. We are talking about hedge fund managers who make >$100M a year. Think about that. If you raised taxes just 4% on income over $1M someone who made $100M last year would have to pay just $4M more in taxes. It's a drop in the bucket when you're talking about Trillion dollar deficits, but it's far from nothing. The majority of US Spending is on the Defense and SS/Medicare and the GOP won't budge on war and no one is gonna piss off seniors.

According to the WSJ:

In 2008, there were 236,883 tax filers reporting income of $1 million or more. The Patriotic Millionaires, a group advocating the repeal of the Bush tax cuts on tax filers making $1 million or more a year, estimated that their plan would raise $500 billion to $600 billion over 10 years.

So $50-60B a year. More than enough to pay for NASA. Unemployment costs have skyrocketed after the collapse, but in 2008 that's more than we spent on UE.

These are very real numbers. Sure $50B is 5% of our deficit. But if we can get people back to work instead of lining the pockets of the super rich that's more money in tax revenue and less in spending. If you can find 10 ways to cut or add $50B you're doing pretty good. The wars. Mortgage interest deduction. Corporate welfare. If $17B is too much for NASA then $50B is nothing to sneeze at with tax revenue.

[Leroy]

I'm asking because I don't know, but what kind of dent would 60 billion a year make in the federal budget? And again, I'm not defending the 'super rich', I just want to know.

And I understand what you are saying about NASA and everything. But they would just find another way to waste the extra money. I don't know how these people keep getting elected, but they do.

[IMADreamer]

I'm asking because I don't know, but what kind of dent would 60 billion a year make in the federal budget? And again, I'm not defending the 'super rich', I just want to know.

And I understand what you are saying about NASA and everything. But they would just find another way to waste the extra money. I don't know how these people keep getting elected, but they do.

No doubt the money would get wasted, and I support NASA, but 50-60 Billion could do some good in fixing our infrastructure which is very bad. That would put people with out much education to work too. It would be a win win.

This country needs massive infrastructure spending for many reasons.

[TheoSqua]

wait wait, have we decided that leroy is not an idiot? When did this happen?

[vinsanity]

I'm asking because I don't know, but what kind of dent would 60 billion a year make in the federal budget? And again, I'm not defending the 'super rich', I just want to know.

Deficit is projected at $1.6T next year. So $160B would be 10% of the deficit.

Eliminating the Bush Tax Cuts would generate, conservatively, $50B in revenue. Eliminating the mortgage interest deduction/capping it would generate another conservative $50B. At higher estimates, these could combine for almost $140-150B in added revenues without the bottom 95% paying an extra dime in taxes.

The Iraq War costs over $2B a week. Or $104B a year. The 5% hike in Capital Gains Taxes also looks to add a good chunk.



If I'm reading this right, the CBO (non partisan Congressional Budget Office in charge of predicting economic impact of legislation) that increase will add $200B to federal revenues, but I think this is already included in the $1.6T deficit.

This isn't a pittance. And it doesn't mean we don't need to find places to make some cuts, but when we could wipe our deficit in 1/5 by those two simple actions and ending the Iraq War....well it's nothing to scoff at.

[Hungary Jack]

$60B/ $3,819B = 1.57%