Our financial system is crumbling this week.

[Leroy]

First thing I'm still confused about. Is the argument that someone makes a billion or a million, or has a billion or a million? There is a big difference.
Second thing is that the mortgage deduction phases out starting at around 160,000 in income.
Third thing is I agree that the limit on social security is stupid, and it isn't the first time I have expressed that.

[robbotis]

The Jobs bill:
The White House said Congress should pay for the jobs plan by imposing new limits on itemized deductions for individuals who earn more than $200,000 a year and families earning more than $250,000.

There are 3.1 Million people that make more than $250,000 a year. 1% of the population. Say, 3 people per household, as the wealthier the person it seems the smaller the family, so even then, this is a tax increase for 3% of the population.

The upper class is against this.
The middle class is generally for such a proposal.
Why is the lower class, or out of work person against such a thing?

Oh, God and Guns...
Idiots.

[vinsanity]

First thing I'm still confused about. Is the argument that someone makes a billion or a million, or has a billion or a million? There is a big difference.

I guess I don't understand that question. It's all about income as far as I know? You can't really tax people just for having an asset.

Second thing is that the mortgage deduction phases out starting at around 160,000 in income.
Third thing is I agree that the limit on social security is stupid, and it isn't the first time I have expressed that.

As for the payroll taxes - I was just saying it was one of the 'loopholes' that you asked for.

The itemized deduction does get capped by reducing the lesser of 1% of income over the ~$160k or 80% of the deductions claimed. Wiki uses $300k with $20k in claimed deductions. Since you're over the value it takes 3%($3996) of the overages and 80% of the deductions taken is $16k. Which ever value is smaller is divided by 3 ($1332) and deducted from the claimed amount. Still good for a $19k deduction.

With $20k in claimed deductions, you'd have to clear exactly 2/3 of a million in income ($666,666.68) for your deductions to be reduced to a limit of $14,666.

But it appears as of 2010 there's no limit on itemized deductions.

[BW23]

This is a good article on the real debt crisis.

Bingo.

I'm extremely ignorant on economics, but it seems to make some sense to me.

[Arthur Dent]

That’s because the real cause of our economic slump isn’t too much government or too little government. It isn’t red tape, high taxes, low taxes, the growing divide between the rich and the poor, too much government debt, too little government debt, corporations, poor people, “greed,” “socialism,” China, Greece, or the legalization of gay marriage. It isn’t, in short, any of the things all the various nitwits say it is.

It’s the debt, stupid.

A major reason for the run up in household debt is the growing divide between rich and poor. From the New Deal up until the 70's or so, median wages grew roughly in line with the overall economy and inequality shrank. After the inflationary crisis of the 70's was resolved on right-wing terms (the busting of unions, etc.), that relationship broke down and median wages have stagnated though the overall economy continued to grow. As a result, virtually all the benefits of economic growth have gone too a small elite class. To sustain demand, and in order to maintain their living standards, households have compensated for lousy pay with borrowing.

This has been a severely underdiscussed aspect to the financial crisis. The lack of demand is largely a structural. How will adequate demand be restored without going back to debt financed consumption if wages remain stagnant? I don't think people realize what a horrendous deal the U.S. economy has been for the middle class for decades.

Government borrowing? That’s the Keynesian solution. “The consumer can no longer borrow like a crazy person,” says the Keynesian, “so Uncle Sam has to do so instead.” It’s just transferring private madness to public madness.

This is wrong for reasons you already understand.

Anyway, I agree that imposed debt reduction is a good idea. The problem, as it has always been, is politics.

[Leroy]

First thing I'm still confused about. Is the argument that someone makes a billion or a million, or has a billion or a million? There is a big difference.

I guess I don't understand that question. It's all about income as far as I know? You can't really tax people just for having an asset.

Second thing is that the mortgage deduction phases out starting at around 160,000 in income.
Third thing is I agree that the limit on social security is stupid, and it isn't the first time I have expressed that.

As for the payroll taxes - I was just saying it was one of the 'loopholes' that you asked for.

The itemized deduction does get capped by reducing the lesser of 1% of income over the ~$160k or 80% of the deductions claimed. Wiki uses $300k with $20k in claimed deductions. Since you're over the value it takes 3%($3996) of the overages and 80% of the deductions taken is $16k. Which ever value is smaller is divided by 3 ($1332) and deducted from the claimed amount. Still good for a $19k deduction.

With $20k in claimed deductions, you'd have to clear exactly 2/3 of a million in income ($666,666.68) for your deductions to be reduced to a limit of $14,666.

But it appears as of 2010 there's no limit on itemized deductions.

I don't think your last sentence is true.

[vinsanity]

But it appears as of 2010 there's no limit on itemized deductions.

I don't think your last sentence is true.

#3 on the IRS.gov Page

Your itemized deductions are no longer limited because of your adjusted gross income.

[slide_into_first]

WaMu reorganization plan rejected again
http://www.reuters.com/article/2011/09/ ... tor&rpc=43
Tue Sep 13, 2011 8:47pm EDT

(Reuters) - Washington Mutual Inc's (WAMUQ.PK) plan to pay more than $7 billion to creditors and exit bankruptcy was rejected by a judge who ordered the company's creditors and shareholders into mediation, according to a Tuesday ruling.

Delaware Bankruptcy Judge Mary Walrath, who rejected the company's first attempted reorganization plan in January, sent the warring parties to mediation to avoid a "litigation morass" that would eat up funds that could be paid to creditors.

Washington Mutual filed for bankruptcy in September 2008, at the height of the financial crisis, after regulators seized its savings and loan business in the biggest bank failure in U.S. history.

The banking business was sold to JPMorgan Chase & Co (JPM.N) for $1.88 billion.

The company reached a deal to distribute $7 billion to the hedge funds that hold its securities, but the plan left nothing for shareholders, who led opposition to the plan.

[heyzeus]

A major reason for the run up in household debt is the growing divide between rich and poor. From the New Deal up until the 70's or so, median wages grew roughly in line with the overall economy and inequality shrank. After the inflationary crisis of the 70's was resolved on right-wing terms (the busting of unions, etc.), that relationship broke down and median wages have stagnated though the overall economy continued to grow. As a result, virtually all the benefits of economic growth have gone too a small elite class. To sustain demand, and in order to maintain their living standards, households have compensated for lousy pay with borrowing.

This has been a severely underdiscussed aspect to the financial crisis. The lack of demand is largely a structural. How will adequate demand be restored without going back to debt financed consumption if wages remain stagnant? I don't think people realize what a horrendous deal the U.S. economy has been for the middle class for decades.

Your prescience is impressive, AD. As if on cue...

http://www.npr.org/2011/09/14/140461738 ... verty-rate

The census bureau released its 2010 numbers. GDP grew at 1.5%, but median household income fell 2.3% How is that possible? Where did all of that money go? Someone is making far more money than they were in 2009. Households living in poverty also increased almost 1%.

[planet planet]

A major reason for the run up in household debt is the growing divide between rich and poor. From the New Deal up until the 70's or so, median wages grew roughly in line with the overall economy and inequality shrank. After the inflationary crisis of the 70's was resolved on right-wing terms (the busting of unions, etc.), that relationship broke down and median wages have stagnated though the overall economy continued to grow. As a result, virtually all the benefits of economic growth have gone too a small elite class. To sustain demand, and in order to maintain their living standards, households have compensated for lousy pay with borrowing.

This has been a severely underdiscussed aspect to the financial crisis. The lack of demand is largely a structural. How will adequate demand be restored without going back to debt financed consumption if wages remain stagnant? I don't think people realize what a horrendous deal the U.S. economy has been for the middle class for decades.

Your prescience is impressive, AD. As if on cue...

http://www.npr.org/2011/09/14/140461738 ... verty-rate

The census bureau released its 2010 numbers. GDP grew at 1.5%, but median household income fell 2.3% How is that possible? Where did all of that money go? Someone is making far more money than they were in 2009. Households living in poverty also increased almost 1%.

The number of people living under the poverty level is now almost 50 million. Of that number, approx. 13% are adults and 21% are children. Seems like the perfect time to cut programs like SCHIP and the like to me.