History of the Income Tax in the United States

[TM_Direct]

A real lesson in taxes:

You drive to work in your new 20k car...the government takes in about $1200.oo in sales tax

You stop and fill up your new car with Gas and the gov't takes in about 35 cents per gallon

You call your mom on the way to work on your cell phone and the gov' taxes both your cell phone and your home phone with 'special fees and taxes for use"

YOU go to work and earn 1000.00 ( the fed takes 275.00)

You decide to invest 500.00 on an OTC BB stock and end up making 100k in a few years ( gov't takes 28k as cap gain)

You get paid a handsome dividend from this stock and now the gov't wants to take a 10% cut of this too
.
You take some of the money and put it into an IRA and invest wisely and it grows, but if you touch it before a certain age the gov't wants about 40% when tax and penalties are accounted for.

You continue to invest in the market and everytime you regular account makes 10k, the go'vt wants $2800 even though they have no risk in this.

You drive home (the gov't takes about 500.00 per month in property taxes to allow you to live there) and walk in the door and flick on the light...the gov't takes about 7 % monthly in taxes and special fees for electricity.

You decide to sit back and have a beer and whack off to a skin-a-max repeat of 'Emanuele in outer space"..the gov takes a huge piece of your beer (about 20%and even has special taxes on your cable bill (5-7%

Pissed off that your cable went out just as Emanuele was going to teach the Zog's about love, you pull out a smoke ..gov't takes a buck or more per pack

You flick on the Internet to check your stock portfolio and the government takes monthly fees for Internet use

you meet a chick online and decide to meet for a drink downtown...so you get into a car that you government has already bilked you for , put in more gas that they bilk you even more for and then use a road that te government decided to charge 3.00 to use.

You find parking downtown but you have to give the government 5.00 in quarters to park on their streets

you meet the girl, get drunk take 2 viagra and have a heart attack and die while having sex in a nearby hotel (the gov't takes 18-20% in some cities for renting the hotel)
..
Now the government wants a piece of your IRA and estate because you had the audacity to die

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Nitto.....Is this what the founding fathers had in mind?

 

[KeithOmalley]

Quote from AAAintheBeltway:

I'm saying no executive is worth more than $5 or 6 mill in compensation. If they need more of an incentive to come to work in the morning, let them buy stock with their own money like you and I do.

A wise man once told me, "the cemetaries are filled with indispensable people. " Most of these big companies pretty much run themselves. The top guys are not indispensable, they are just good corporate politicians or lucky.

I'm not sure what that crack about the DC area is supposed to mean, but if you read a few of my posts, you will see I am about as conservative as anyone on this board. I am not talking about punishing success per se but about addressing a failure in corporate governance that leads to a few people abusing their positions to steal from the shareholders.

so you have all your money in a bank stock. would you rather have that money in the stock that is run by jamie dimond? or chuck prince?

 

[AAAintheBeltway]

Quote from KeithOmalley:

so you have all your money in a bank stock. would you rather have that money in the stock that is run by jamie dimond? or chuck prince?

The answer is obvious, but has nothing to do with the level of compensation. How much was Prince making? A lot.

Of course, some execs are better than others. Are any worth the gargantuan amounts they take? Only in a fucked up system where total incompetents make $20 mill.

 

[dumb_mother]

i work for commission for a living, if it was a 20% commission and i grossed 100mm and didn't get my 20mm i would shoot someone- why is it so crazy for these ceo's to receive what their company can make in 2 business days as a paycheck.

 

[KeithOmalley]

Quote from AAAintheBeltway:

The answer is obvious, but has nothing to do with the level of compensation. How much was Prince making? A lot.

Of course, some execs are better than others. Are any worth the gargantuan amounts they take? Only in a fucked up system where total incompetents make $20 mill.

yeah your missing my point this was his quote below. i would rather have a-rod as my 3rd baseman rather then some minor league player. i would pay accordingly. sometimes do you pay someone more then he is worth. looking back on it, the yankees probaly would not take Jason Giambi's contract or would have signed pavono. its very subjective to say someone should only make $x or $y. who are we to judge

"but I can tell you that CEOs making anything over $5 or 6 mill is not right. It's just too out of line for what other professionals and executives make. Being CEO is a trust, not a license to see how much one can steal. They don't make it in most other countries. "

 

[AAAintheBeltway]

Quote from hofficita:

Let me first say that I think you are one of the smartest guys on ET, but you are dead wrong on this issue. Runaway exec comp is not a failure of the SEC or corporate governance. It is a failure on the part of stupid shareholders who allow it. If you think a CEO is getting paid too much, invest in a different company (there are plenty with modest exec comps). If enough people agree with you, the company will decrease in value to a point where they will be forced to change comp or will be taken private.

Of course, if there is fraud or a demonstrable breach of fiduciary responsibility, take them to court.

Well, in theory I would totally agree with you, but we see it doesn't work that way in practice. When the stocks decline drastically in value, the most common course of action is to reprice all the stock options. They have to be incentivized after all or they might take their brand of special magic elsewhere.

At least with pro athletes and entertainers they have to produce or their big earnings are soon over. Not with CEOs. They entrench themselves with their cronies on the board and stay until they are 65 or in many cases much older. Then when they do leave, the grateful board hands them another obscene windfall at shareholder expense.

I always wondered what kind of dumb shareholders vote for this stuff, then I realized most of them are big institutions who either don't want to rock the boat, for fear of getting shut out, or who have obvious conflicts of interest in that they run pension money or do underwritings or whatever for the company. One hand washing the other, only the shareholders provide the soap.

 

[AAAintheBeltway]

Quote from dumb_mother:

i work for commission for a living, if it was a 20% commission and i grossed 100mm and didn't get my 20mm i would shoot someone- why is it so crazy for these ceo's to receive what their company can make in 2 business days as a paycheck.

What do you make if you sell nothing? Bumpus. No one has a problem with that, least of all me, because you are eating what you kill.

I don't have a problem with superior performers being rewarded. I do have a problem with ordinary performers being comp'ed like they are responsible personally for a company's success. I don't see any of them giving anything back when the company craters. Then they want options repriced or a nice golden parachute.

The tax system is a very blunt instrument to use to address this issue. I recognize that. Nothing else seems to be effective however.

 

[AAAintheBeltway]

Quote from KeithOmalley:

yeah your missing my point this was his quote below. i would rather have a-rod as my 3rd baseman rather then some minor league player. i would pay accordingly. sometimes do you pay someone more then he is worth. looking back on it, the yankees probaly would not take Jason Giambi's contract or would have signed pavono. its very subjective to say someone should only make $x or $y. who are we to judge

"but I can tell you that CEOs making anything over $5 or 6 mill is not right. It's just too out of line for what other professionals and executives make. Being CEO is a trust, not a license to see how much one can steal. They don't make it in most other countries. "

Again, in theory I agree with you, but the system is broken. You must see that. You can't compare an employee, A-Rod for example, with someone who essentially sets their own compensation, like most CEOs do. The companies do everything possible to obfuscate the numbers. Shareholders are not even entitled to vote on basic compensation, only option plans, as far as I know.

The whole system of incentive stock options needs to be reformed. It distorts corporate accounting by shifting compensation from the company to shareholders. Then the company has to waste capital to buy in shares for these giveaways.

 

[nitro]

Quote from CPTrader:

No I won't ask you in two years... the question should be answered now. We vote in politicians on the basis of what our CURRENT assessment of their policies hold for the future. We aren't chooisng a date or a "summer girlfriend"; we are choosing the POTUS.

So again I ask "Is this good"? What do you think TODAY and why?

Ok,

1) For me, it is likely to be detrimental if all I measure is how much money I take home after taxes.

2) For the general economy? Very difficult to say. Most of the employment in this country is done by small businesses. Taxing these guys at $250k is going to cause the following effects: a) Prices are going to rise and be passed on to the consumer. b) small businesses will fire one person to make up for lost profits.

3) On the other hand, there is no way to measure the immense hope that it will give people that felt there was no way out. The smart ones will take this opportunity to raise themselves out of poverty and raise their level of training/education. Now that most of these people [may] no longer have to have two or more jobs just to survive, they may take that spare time to increase their education, and perhaps for the first time in their life take it seriously. That will have huge implications for our economy.

4) The entire rest of the world likely will see us in a more benign light. We will export medicine, technology, education, services, etc etc, instead of bombs. That should make our world safer and will create new customers.

In conclusion, I think it will overall be beneficial to us all, even though out of my pocket I will pay for it in the short term.

nitro

 

[Daal]

Quote from nitro:


3) On the other hand, there is no way to measure the immense hope that it will give people that felt there was no way out. The smart ones will take this oppotunity to raise themselves out of porverty and raise their level of training/education. Now that mmost of these people [may] no longer have to have two or more jobs just to survive, they may take that spare time to increase their education, and perhaps for the first time in their life take it seriously. That will have huge implications for our economy.

so you think increasing welfare could help to increase people's motivation to study and educate themselves?psycology says its just the opposite