80% tax rate Means prosperity

[Messi007]

Very good post. Im new here in NY and I found out that a lot Hispanic and african American live pretty well doing nothing... People here in NY gets Housing, Food, salary and even furtinure if they don't have a job. Most people from Puerto Rico here in NY don't work and live like kings (Flat TV, Jordan Nike, Iphone etc) and a lot of these people exchange their social benefits with their next grocery store for cash. at discount. A BIG mafia in every expresion of the word.

Ultra Rich paid next to nothing, But their volumen is so huge, that its a very good income for the government. And small-medium business owner paid whatever they want to pay. So, the Blue collar employers are the ones that has been violated day in day out since the creation of the IRS.

From My point of View, the problem in America is no the taxes. Their problem is that their Tax Code has been son complicated for so long, that has become so inefficient... If they manage to simplify the tax code, eliminated all those socialist entitlement (I read that 80% of the US debt goes to welfare programs) America will become more competitive.

If they raise taxes on rich and prosperous people, they just have to pass that cost to consumer and at the end, the middle class will suffer (this is what happen in europe for so long).

Tax is an a oppression, period.. The system is desing to educate us to become dependant of the Goverment.. Back in the days, the washington was afraid of its citizens, Today, The US citizens are afraid of their Government.

Beaurocracy is Not the answer for the american problems. beaurocracy Is the problem.

Another thing I notice as a Inmigrant, is that the european Inmigrants wants to become an Americans! But the Hispanic Inmigrants, they want to import their ideology.. I think that the US should make the English and the American Culture a mandatory law..

Again, sorry for my english.

But this is utopic in today world.

Quote from MKTrader:

Not this again...

Here's what someone posted on another forum in response to this "let's tax our way to prosperity with the old rates" fallacy:

"The dishonesty or perhaps ignorance in the tax debate that is going on today is the complete misrepresentation of the pre-TRA86 higher marginal rates in the old '53 code. Sure the marginal rates were insane, but the underlying tax code was rife with loopholes that a good tax planner (I was one) could exploit to get a persons effective tax rate as low or lower then it is today. Those loopholes are no longer part of the tax code which is a good thing as they encouraged investors to invest in projects that had no economic viability other then the income sheltering effect they created.

What else is ignored in the conversation is the fact that there was a massive amount of tax fraud at all income levels under the old code. It was so bad and so common that most people took pride in telling others how they cheated on their taxes. When I was practicing it was quite common for us to pick up clients that had owned businesses that had grown into large enterprises that cheated extensively on their income taxes sometimes for decades. Usually the only reason this ever got exposed was due to the owners wanting to sell or go public.

Today it would be very hard to get away with significant tax fraud for very long and the current code does not offer very many ways to legally shelter income, so a marginal tax rate of 70% would probably produce an effective tax rate on the top 5% of at least 45-50% which would be more then double double what the effective rate was under the old tax code. Thus, if we were to go back to those insane marginal tax rates, we would be crossing into a level of taxation never seen in this country."

 

[failed_trad3r]

Quote from Messi007:

Im not an american. But from what I learned, the two biggest period of Prosperity in America was between 1896 to 1932 that was dominated by the Republican party and 1980-2012 also dominated by the GOP. In those 2 periods, Tax rates was at their lowest level.

From 1940s to 1980s was a very tought period for America (social riots and few consecutive recesions, Hyperinflations and 3 wars *WW2-Korea and Vietnam*.)

1980-2012 is a debt ponzi. 1896-1932 is also a debt ponzi. If what you're syaing is true , Republicans create debt ponzis. But I think your trolling, you conveniently pick dates right before depressions, as if to say republicans cause depressions. 1940-1980 is the normal status quo = low credit expansion.

 

[failed_trad3r]

Quote from MKTrader:

Not this again...

Here's what someone posted on another forum in response to this "let's tax our way to prosperity with the old rates" fallacy:

"The dishonesty or perhaps ignorance in the tax debate that is going on today is the complete misrepresentation of the pre-TRA86 higher marginal rates in the old '53 code. Sure the marginal rates were insane, but the underlying tax code was rife with loopholes that a good tax planner (I was one) could exploit to get a persons effective tax rate as low or lower then it is today. Those loopholes are no longer part of the tax code which is a good thing as they encouraged investors to invest in projects that had no economic viability other then the income sheltering effect they created.

What else is ignored in the conversation is the fact that there was a massive amount of tax fraud at all income levels under the old code. It was so bad and so common that most people took pride in telling others how they cheated on their taxes. When I was practicing it was quite common for us to pick up clients that had owned businesses that had grown into large enterprises that cheated extensively on their income taxes sometimes for decades. Usually the only reason this ever got exposed was due to the owners wanting to sell or go public.

Today it would be very hard to get away with significant tax fraud for very long and the current code does not offer very many ways to legally shelter income, so a marginal tax rate of 70% would probably produce an effective tax rate on the top 5% of at least 45-50% which would be more then double double what the effective rate was under the old tax code. Thus, if we were to go back to those insane marginal tax rates, we would be crossing into a level of taxation never seen in this country."

You can't argue with this. Because you can't. It's an anecdote from 40 years ago. Impossible to refute whether it's true or not.

I doubt tax evasion went down or went up significantly over the years. I see alot of tax evasion currently too.

 

[failed_trad3r]

Quote from trefoil:

I'm going to make one comment and one only, because the pitchforks and torches are already out I see.
It stabilizes the economy. You get some money drained out of the system in good times, and that money gets released in the form of deficit spending in bad times.
Which partially explains why the economy was much more stable prior to 1980, when deficits in good times were habitually lower and tax rates of course were higher. It also goes far towards explaining why the dot-com bust didn't do much economic damage, while this latter financial bust did: there was no reserve on hand at the Federal level for the inevitable flood of deficit spending when the economy went south bigtime. Instead rates were lowered and the boom went crazy, leading of course to a nice big bust.
As for Italy, those folks are fleeing, to the extent it's happening, because of the euro crisis. Tax avoidance in Italy is a high art, so it ain't the taxes.

the dot com bust didnt do damage because credit expansion continued due to the housing boom. There was never actually a drop in credit expansion growth.

 

[jueco2005]

Quote from Messi007:

Im not an american. But from what I learned, the two biggest period of Prosperity in America was between 1896 to 1932 that was dominated by the Republican party and 1980-2012 also dominated by the GOP. In those 2 periods, Tax rates was at their lowest level.

Yet during those 2 periods the US experienced the biggest bubbles build ups in history. Especially the 90s tech bubble and the real estate bubble in 00s. Regardless of that, innovation never stops and entrepreneurs keep supplying us with prosperous inventions and opportunities.

Quote from Messi007:



From 1940s to 1980s was a very tought period for America (social riots and few consecutive recesions, Hyperinflations and 3 wars *WW2-Korea and Vietnam*.)

I see these years way different.

I see a triumph from democracy over empires. At least an important step. A better world was born after VE in Germany and Japan in 1945. Huge Medical and all kinds of new inventions were possible. Our space age began. Economies and business thrived everywhere.

 

[jueco2005]

Quote from JerryAdler:

Totally wrong? By whose measure? Yours? Where is the quote that these people said "everything is just fine?" You're making it up as you go along.

You sound like a disgruntled socialist who would like to see this country head toward a European model which will probably crash and burn within the next 24 months. Frankly, Europe sounds like a better bet for your hypothesis that an 80% tax rate creates prosperity. It will be an easy sell over there. Problem is 80% of nothing is nothing. Except for Germany, productivity is at an all time low. But let's not quibble. After all, socialism looks good on paper - and paper is all you have to sell to the ignorant. The reality of failed governments is merely the 6 o'clock news.

No I am no Socialist. I already lived through that BS. However, I do believe there is a lot the US can learn from Europe and vice versa.

When the cold war was hot it was easier to reject anything social in the name of capitalism vs communism. Since 1990 there is virtually no more ideologic, economic and military wars between communism and socialism.

However, to keep the wheel going we need a new enemy. Now Europeans are “Socialists”, virtually just a step away from communism.

How then did England, France and Germany championed the fight against communism when they seem virtually the same to us???

Please follow some common sense here. We are doing many things wrong here in the US. We have too much government where we need little of it and vice versa.

Also not all Europeans are created equal. Same here.

The same difference between Houston and Detroit exists between Berlin and Athens.

 

[zdreg]

Quote from jueco2005:

No I am no Socialist. I already lived through that BS. However, I do believe there is a lot the US can learn from Europe and vice versa.

When the cold war was hot it was easier to reject anything social in the name of capitalism vs communism. Since 1990 there is virtually no more ideologic, economic and military wars between communism and socialism.

However, to keep the wheel going we need a new enemy. Now Europeans are “Socialists”, virtually just a step away from communism.

How then did England, France and Germany championed the fight against communism when they seem virtually the same to us???

Please follow some common sense here. We are doing many things wrong here in the US. We have too much government where we need little of it and vice versa.

Also not all Europeans are created equal. Same here.

The same difference between Houston and Detroit exists between Berlin and Athens.

"
However, to keep the wheel going we need a new enemy. Now Europeans are “Socialists”, virtually just a step away from communism. "

"Please follow some common sense here. We are doing many things wrong here in the US. We have too much government where we need little of it and vice versa. "

your writing is mostly blather.

the american people have sold their souls in exchange for government benefits, which will prove to be illusionary, because they will bankrupt the country. as long as the rest of the world is willing to lend to the US living standards are maintained under an ever increasing mountain of debt. the market is now forcing europeans to face their debt mountain. the US and $US has a respite because of the euro crisis. once that passes the $US will follow its long tern downward trend and US standard of living will drop precipitously.

"we have met the enemy . the enemy is us."
author unknown

 

[trefoil]

Quote from zdreg:

"
However, to keep the wheel going we need a new enemy. Now Europeans are “Socialists”, virtually just a step away from communism. "

"Please follow some common sense here. We are doing many things wrong here in the US. We have too much government where we need little of it and vice versa. "

your writing is mostly blather.

the american people have sold their souls in exchange for government benefits, which will prove to be illusionary, because they will bankrupt the country. as long as the rest of the world is willing to lend to the US living standards are maintained under an ever increasing mountain of debt. the market is now forcing europeans to face their debt mountain. the US and $US has a respite because of the euro crisis. once that passes the $US will follow its long tern downward trend and US standard of living will drop precipitously.

"we have met the enemy . the enemy is us."
author unknown

There seems to be an inability to separate the issues around here, which is the usual behavior when these things come up.
Three things are being juggled, when only one is up for discussion:

1 - A progressive tax structure, which is the actual subject of the OP.
2 - High taxes, which is an entirely different thing. You can have 1 without this.
3 - High spending. Once again, you can have 1 without this.

Considering our guy likes Austrians, I don't think he's advocating for 2 or 3.

 

[zdreg]

Quote from trefoil:

There seems to be an inability to separate the issues around here, which is the usual behavior when these things come up.
Three things are being juggled, when only one is up for discussion:

1 - A progressive tax structure, which is the actual subject of the OP.
2 - High taxes, which is an entirely different thing. You can have 1 without this.
3 - High spending. Once again, you can have 1 without this.

Considering our guy likes Austrians, I don't think he's advocating for 2 or 3.

you are right. my response was not conductive to furthering discussion of progressive tax which is the premise of this thread

 

[jueco2005]

Quote from zdreg:

"
However, to keep the wheel going we need a new enemy. Now Europeans are “Socialists”, virtually just a step away from communism. "

"Please follow some common sense here. We are doing many things wrong here in the US. We have too much government where we need little of it and vice versa. "

your writing is mostly blather.

the american people have sold their souls in exchange for government benefits, which will prove to be illusionary, because they will bankrupt the country. as long as the rest of the world is willing to lend to the US living standards are maintained under an ever increasing mountain of debt. the market is now forcing europeans to face their debt mountain. the US and $US has a respite because of the euro crisis. once that passes the $US will follow its long tern downward trend and US standard of living will drop precipitously.

"we have met the enemy . the enemy is us."
author unknown

Lets see if this makes sense to you.

The US is the biggest socialist country of all. Instead of practicing socialism from the bottom up we do it from the top down. Call it corporate welfare or whatever you want. This works best when you create big oligopolies and name them “TOO BIG TO FAIL”.

This is a system where gains are privatized and loses socialized. It takes 10,000 pages of law paperwork to buy a pencil. But it took only 700 billion “to save wall street” in 3 pages. One of the sentences prohibited such law from ever being reviewed by any court of law or administrative agency. Makes me think about socialism.

I called it corporatism, partnership with the government to use state means to enhance a firms changes to capture a bigger share of the market.

We have one of the most generous retirement benefits for all public “servants”, at ALL levels of government. Yet our soldiers struggle when coming from the front.