Our financial system is crumbling this week.

[vinsanity]

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

$4T deficit? Where are you seeing that?

They are saying just $1300B this year and I saw early predictions at $1600B next year?

Bloomberg

[Hungary Jack]

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

$4T deficit? Where are you seeing that?

They are saying just $1300B this year and I saw early predictions at $1600B next year?

Bloomberg

As percent of spending.

[vinsanity]

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

As percent of spending.

Gotcha. I like to use the deficit cause it makes the percentages look a little bigger and that's what people tend to get up in a wad over.

[Joe Shlabotnik]

Just ran across this quote and it says what I've been feeling about things ever since 'irrational exuberance':

Then you will see the rise of the double standard – the men who live by force, yet count on those who live by trade to create the value of their looted money – the men who are the hitchhikers of virtue. In a moral society, these are the criminals, and the statutes are written to protect you against them. But when a society establishes criminals-by-right and looters-by-law – men who use force to seize the wealth of disarmed victims – then money becomes its creators' avenger. Such looters believe it safe to rob defenseless men, once they've passed a law to disarm them. But their loot becomes the magnet for other looters, who get it from them as they got it. Then the race goes, not to the ablest at production, but to those most ruthless at brutality. When force is the standard, the murderer wins over the pickpocket. And then that society vanishes, in a spread of ruins and slaughter. ~ Francisco d'Anconia

[Joe Shlabotnik]

Who IS Francisco d'Anconia?

HAHA! Just looked it up - Atlas Shrugged. Jokes on me I guess. Funny, but I think Libertarianism LEADS to the kind of thing F d'A is talking about.

Do you wish to know whether that day is coming? Watch money. Money is the barometer of a society's virtue. When you see that trading is done, not by consent, but by compulsion – when you see that in order to produce, you need to obtain permission from men who produce nothing – when you see that money is flowing to those who deal, not in goods, but in favors – when you see that men get richer by graft and by pull than by work, and your laws don't protect you against them, but protect them against you – when you see corruption being rewarded and honesty becoming a self-sacrifice – you may know that your society is doomed. ~ Francisco d'Anconia

[Freed Roger]

It is absurd that LT Capital Gains and Dividends get taxed at max of 15%-while wages run through the full gamut of taxation. From what David Stockman (Reagan's economic guy) says - the theory behind the original lowering of capital gains rate was to offset the effects of inflation -back when a dollar invested or held today would be worth substantially less (could buy less goods) a year later.

[SHOW]

“The culprit here was the combination of ultralow rates of interest at the Federal Reserve and ultralow rates of taxation on capital gains. The former destroyed the nation’s capital markets, fueling huge growth in household and business debt, serial asset bubbles and endless leveraged speculation in equities, commodities, currencies and other assets.

At the same time, the nearly untaxed windfall gains accrued to pure financial speculators, not the backyard inventors envisioned by the Republican-inspired capital-gains tax revolution of 1978. And they happened in an environment of essentially zero inflation, the opposite of the double-digit inflation that justified a lower tax rate on capital gains back then — but which is now simply an obsolete tax subsidy to the rich.”

Yet, favortism for investement income tax rates has become part of the folklore - of "necessary" economic driver.

RE -Buffett - the oft-repeated talking point on how he could voluntarily pay more tax are amusing.

Longhorn -I know I've smarted off inadvertently towards your profession in the past -but I would appreciate a primer on the marginal utility of a dollar and how it justifies the economic logic behind a progressive tax system.

[Leroy]

I don't think it is an amusing talking point Freed. The point of it is, that if he thinks the rich should pay more taxes he and his 'fat cat'

It is absurd that LT Capital Gains and Dividends get taxed at max of 15%-while wages run through the full gamut of taxation. From what David Stockman (Reagan's economic guy) says - the theory behind the original lowering of capital gains rate was to offset the effects of inflation -back when a dollar invested or held today would be worth substantially less (could buy less goods) a year later.

[SHOW]

“The culprit here was the combination of ultralow rates of interest at the Federal Reserve and ultralow rates of taxation on capital gains. The former destroyed the nation’s capital markets, fueling huge growth in household and business debt, serial asset bubbles and endless leveraged speculation in equities, commodities, currencies and other assets.

At the same time, the nearly untaxed windfall gains accrued to pure financial speculators, not the backyard inventors envisioned by the Republican-inspired capital-gains tax revolution of 1978. And they happened in an environment of essentially zero inflation, the opposite of the double-digit inflation that justified a lower tax rate on capital gains back then — but which is now simply an obsolete tax subsidy to the rich.”

Yet, favortism for investement income tax rates has become part of the folklore - of "necessary" economic driver.

RE -Buffett - the oft-repeated talking point on how he could voluntarily pay more tax are amusing.

Longhorn -I know I've smarted off inadvertently towards your profession in the past -but I would appreciate a primer on the marginal utility of a dollar and how it justifies the economic logic behind a progressive tax system.

friends can make that happen. But they don't.

[Freed Roger]

I don't think it is an amusing talking point Freed. The point of it is, that if he thinks the rich should pay more taxes he and his 'fat cat' friends can make that happen. But they don't.

I am not sure what you mean about them making it happen? Buffett pay taxes in a voluntary tax system? Or Buffett do a Koch Brothers in reverse -buy politicians that will raise his taxes?

[AdmiralKird]

People might be willing to pay more taxes if it were something that they really believe in, like we actually had a goal or direction as a nation. But our current system is all about collecting for the major spending pool. I wonder what would happen if each citizen could allocate their taxes towards certain programs rather than the ole spending pile. Probably a bad idea for the masses, but I think it would be interesting to see where America would actually place its money if it was a direct democracy rather than representative. I think you would see NASA get about ten times its budget.

[TimeForGuinness]

People might be willing to pay more taxes if it were something that they really believe in, like we actually had a goal or direction as a nation. But our current system is all about collecting for the major spending pool. I wonder what would happen if each citizen could allocate their taxes towards certain programs rather than the ole spending pile. Probably a bad idea for the masses, but I think it would be interesting to see where America would actually place its money if it was a direct democracy rather than representative. I think you would see NASA get about ten times its budget.

I've thought about this before, and I think it would be a wash. A lot of people would put their money into social programs, other people would put it towards the military, people in the middle would do both. I don't think you'd see very many changes to the overall allocations.

It becomes a problem if the programs only benefit the people supporting them through taxes, though. Will the military protect the US population, or just the people that fund them? Will social programs benefit everyone US citizen, or just their certain taxpayers?

Society sorta breaks down.