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[QUOTE=Esten]I request an official count of how often each side does this![/QUOTE]How about this: I'll stipulate that each side does it all the fucking time.
Now, Esten, will you stop injecting pointless smoke screens in the middle of your arguments?
[QUOTE=Esten]El Queso,
Obama doesn't advocate spending based on just his own ideas, guidance on economic policy comes from economic advisers and experts. And it's all in the context of what is best for the country at this point in time - being which the longest recession in decades. Detractors seem to conveniently omit these significant points in their attacks. And while spending less than half of the $787 billion stimulus, including significant tax breaks, there is a lot of good that has come out of this spending. That being said, the signals we are getting are that stimulus spending will wind down this year with more austerity kicking in next year. This all sounds reasonable to me. Of course the administration recognizes the need to switch gears as the recovery kicks in. [/QUOTE]I know he hasn't spent all the money yet - and if in fact the economy is turning around why not stop? Why do we have to spend it all?
Those who detract from his stimulus DO NOT think that it is needed, so it's not like we're omitting a "fact" but rather an opinion. The bailouts of the banking system - maybe. Many of us are not convinced of that, even. Many of us think that we keep bailing out troubled institutions and are just setting ourselves up for an even worse fall than so far.
And what, exactly, HAS the stimulus done? Nothing really. It certainly has created no jobs so far - the Obama administration was touting how it "created" some 400K jobs last month and then we find out that all but about 40K of those jobs were government jobs saved by the stimulus, and also the employment of people for the 2010 Census! And those jobs will be gone soon!
Was is just yesterday that Biden said we were never going to recoup some 7 million jobs that were lost udring the recession?
How exactly has anyone other than a government agency or union shop benefitted fromt hat stimulus?
And you mention these words above particularly:
"...the signals we are getting are that stimulus spending will wind down this year with more austerity kicking in next year. This all sounds reasonable to me. Of course the administration recognizes the need to switch gears as the recovery kicks in."
How can you say that when over the last few days the Democrats are talking about another stimulus bill, though smaller to be sure, and Obama himself told the leaders of nations who have notoriuosly overspent on social programs that we must keep the spending up, while they are telling him - enough, we have to cut budgets and stop spending so much?
I understand that Obama himself doesn't come up with many of the ideas he actually implements. I understand that his advisers are telling him AND Congress (the Democratic side) what they should do. The problem is, Keynsian economics doesn't work. The advisers are giving bad advice and Obama and the Democrats are extending the problem because of it.
[QUOTE=Esten]To a point you are correct we can't just snap our fingers and have renewable energy, which is why we should invest in research. But there are technologies available now (eg. Wind turbines) that can and should be expanded (and this country is in the very early stages of doing so) No I don't think big oil is keeping this down, just a lack of vision in the past from our leaders.
I would think if we had conclusive evidence we are not running out of oil, this would be well-known. This must be the world's best kept secret! Until it's proven, yes we should act to expand renewable energy based on what we do know (proven technologies) and what we don't (research) History provides many examples of how complacency preceeded disaster. I am not familiar with the Tokamak research but I agree we need to apply due diligence in allocating our research dollars.[/QUOTE]Esten, we have been told by the "greens" for decades that we will reach the point where we developed less oil X year than last, or the "Peak Oil" crisis. In the 70s that peak was sometime in the 90s! It never came.
Every year we hear about all of these scary stories how the world is dying, how we are going to alternately freeze and boil. How the seas are going to rise and swallow all coastal communities and all the freshwater in the world in the form of glaciers and polar ice caps is going to melt into the ocean and we will all die of thirst. Our crops won't grow. We will be killed by the sun.
None of that has come true. Even the ice caps are re-freezing as of the last year or two, back on a cycle of moving towards a cooler clime than over the last few hundred years.
The FACT is that the "green" people, who have infested the Democrats, are pushing their agenda with a bunch of lies and half-truths.
You are advocating that we "do something" because of political pressure that stretches back almost 40 years from a group that has its own agenda and has never really had a clue, other than being right that we should steward the environment better than we have. And we have - things are SIGNIFICANTLY cleaner than they were 40 years ago - in the States. But look at places like Argentina. It ain't so down here.
Your suggestion that government must get involved because free market can't point us where we need to go is absurd. If there were a market for it, it would happen. If the oil companies really thought, for example, that we were about to run out of oil, I guarantee you they would be pumping huge sums of money into research on how else to provide energy to the country - maybe not all, but the smart ones.
The oil companies don't say we're running out of oil - the "greens" do who have their own agenda for getting rid of oil companies because many of the "greens" are also socilistic who believe it is "fair" to distribute wealth from the rich to the poor.
A free market is STRONGER and will PRODUCE MORE IDEAS than ANYTHING the government can do. List some fo the disasters you talked about and I can almost guarantee you that behind them is some attempt to mess in things, interfering with the free market.
The US has not ever really had a free market, with the exception of early in its inception, before government stuck its hand in things and started handing out monopolies for things like the railroads, for example.
The Tokamak research is a PRIME example of the government really should stay as far away from anything technical as possible because although lawmakers may know the law (and that is often disputable) they rarely have ANY IDEA what they are talking about when it comes to science and engineering, and economics.
[QUOTE=Esten]
You are demonstrating 2 important misconceptions:
1. The misconception or implication that Dems don't value individual effort and think the government should create most jobs. This is totally false. Both parties recognize the private sector as the main driver of growth and jobs. The difference is that Dems simply put a greater value on addressing injustices and inequalities in a system that creates tremendous wealth (and thereby the means to address such issues) We see the role of the government here because the private sector cannot or has failed to address these issues.
2. The misconception that Obama is pursuing an agenda that the country 'as a whole' doesn't want. The fact is the country is split into three groups: those who think we are going in the wrong direction, those who think we are going in the right direction but not far enough, and the rest in the middle who are generally in agreement. Don't be misled by those who try to lump the discontent in the first two groups together.
There are many right wing talking heads like Sarah Palin who love to get on TV and say "Americans don't want blah blah blah." like they are speaking for everyone. LMAO![/QUOTE]1. The big difference is that the left thinks people are incapable of making the decisions as to what should be done, and therefore think they do and they should control it. The people on the right think that people are motivated by personal self-interest and that they will always find a way to succeed if they are just left alone.
The left thinks that you have to take care of every person who supposedly can't take care of themselves, and that it is the government's job to do so. They think that THAT is what makes poor people richer. The right sees that everyone should work their asses off to get ahead and that a person makes opportunities for themselves.
Again, as I've stated a few times now, but you have ignored, what other system has ever raised so many people out of poverty int he history of the world? What country's poor live better than kings of the past in many ways and certainly live like middle class in other countries (Argentina being one of them)
Every time we screw around with things, we screw them up. Economics is more suited to Chaos theory than any kind of engineering.
2. Have you seen the massive polls that have come out in the last week? Including polls by NBC and many supposedly "mainstream" organizations? That say 60+% of the country's population think we are headed the wrong direction? Man, you are sheltering in the shade of bad information. The country as a whole does not like what Obama is trying to do. At every turn he is telling the country that HE knows better than we what we should be concentrating on, how what we are concentrating on should be done, and doing everything possible to downplay ANY suggestions from the "right."
What we have instead are people working with Obama like Nancy Pelosi who boldly said in front of everyone that they will pass health care, for example, whether they have to go over the fence, under the fence, parachute in, etc. Whether we like it or not.
Yeah, one big problem we have is that Progressive talking heads like her are not only talking and saying things that would damage the country if they had the power - THEY ACTUALLY HAVE THE POWER!
Obama is bad for the country and making things worse on a daily basis. I hope that come November we see a shift that makes him a lame duck before he completely destroys us.
On the tax issue - we all stipulate it isn't fair. Let's have a flat tax. Let's make it really fair. Or a federal sales tax. Anything that our glorious lawmakers have not set up to allow THEM, as part of the wealthiest class in America, to have exceptions to paying taxes.
I'm for it - is Obama?
What makes people think that "simple" and "fair" mean the same thing? A reasonable definition of fair is "free from bias, dishonesty, or injustice". Why does a flat 25% tax meets that definition any better than a sliding scale, a flat $5,000 per person, or a VAT? Taxes are a necessary evil but the abuses come in the form of targeted (i.e., special interest lobby) deductions and credits rather than the final method of tax calculation.
How exactly are lawmakers part of the wealthiest class in America? They make $174K per year which is good but far from great or wealthy. About like a mid-level manager in a large corporation. Good health care and pension benefits but I've got lots of friends that do better and none of them would be considered part of the wealthiest class in America.
And why do you think lawmakers have some special way of avoiding taxes? Obama paid 32% in federal income taxes in 2009.
[url]http://www.whitehouse.gov/sites/default/files/president-obama-2010-complete-return.pdf[/url]
Biden paid only paid 21% while I only paid 11%. But both Joe and I would have vastly preferred to pay Obama's 31% since 68% of $5.5M is 10x what Biden had left after taxes and 25x what I had.
Along with the elimination of the deduction of mortgage interest, state taxes, and health insurance premiums for businesses, I favor elimination of the expat $91K deduction and the deduction for foreign tax payments. It's hardly fair that I pay more so that they can pay less just because they choose to live someplace else.
[QUOTE=Esten]My tax example actually underestimates the rate at which wealth grows faster in higher income brackets, because it doesn't factor in the lower tax rates (15%) on capital gains and dividends. When you factor these in, with the wealthy having a much larger amount and percentage of their income taxed at lower rates, the upward concentration of wealth only accelerates further. No wonder the Bush tax cuts were widely criticized as a massive transfer of wealth to the rich.
Back in 2007, Warren Buffett said he pays less tax, as a percentage of his taxable income, than the people working in his office. To make his point, he said he would bet any Forbes 400 member $1 million (to charity) that the average federal tax rate paid by the Forbes 400 is less than the average rate of their secretaries.
Buffett also said that US government policy had accentuated a disparity of wealth that hurt the economy by stifling opportunity and motivation. And he explained he was a Democrat because Republicans are more likely to think: "I'm making $80 million a year – God must have intended me to have a lower tax rate."
That says something when even ultra wealthy people (Buffett's not the only one) disagree with the wealth inequality created by Republican taxation policies.[/QUOTE]Esten, Buffet's views on taxes are self serving. He likes the estate tax, because it enables him to buy out family-owned businesses, like Borsheim's and Nebraska Furniture Mart, at a discount, when the children have to sell to pay taxes.
Another example, Buffet, like you, thinks it's a good thing that the tax rate on dividends will be going up. Dividends received by individuals will go to 39.6% in 2011 and 43.4% in 2013. After you add in the corporation tax and state income tax, about 70% of income received by corporations and distributed to wealthy individuals will be paid in tax. This is asinine and is going to cause too much capital to be allocated to businesses that produce poor returns, instead of to the most productive parts of the economy. I don't think there's any point in explaining why to you, as apparently you believe the way to prosperity is to take money away from the most productive parts of the economy and redistribute it to reduce inequality. Anyway, Buffet doesn't care because (a) Berkshire Hathaway, as a corporation, will continue to get a tax deduction for 70% of the dividend income it receives and (b) Berkshire Hathaway predominately invests in companies that don't pay dividends.
Since Berkshire Hathaway doesn't pay a dividend, Buffet doesn't pay taxes. Maybe that's why his secretary pays at a higher rate.
What you say about billionaires and their secretaries may or may not be true. Billionaires who buy off Democrat and Republican politicians have lots of ways to manipulate the system. (And I'd argue they buy off more Democrats than Republicans.) But I damn well know that the successful small-to-medium size business owner, who's going to be paying 39.6% federal income tax plus 5% to 10% state income tax plus sales taxes plus property taxes plus employment taxes is paying a lot more in percentage terms than his secretary. And by bleeding him, you're hurting the people that work for him and his suppliers and his customers and ultimately the consumer. When he dies his estate will pay 55% of everything over $1 million. If you're in his shoes and you don't have the money or the desire to have an army of lawyers, accountants and politicians in your hind pocket, you're going to get screwed. In fact, maybe you're going to be motivated to sell what you've got and invest everything in tax free municipal bonds, like John Kerry's billionaire wife. She, indeed, does pay a much lower tax rate than you or me. But, hey, somebody's got to bail out California. And even right now, municipal bonds are a lot safer bet and a lot less work than a start-up business.
[QUOTE=Easy Go] Biden paid only paid 21% while I only paid 11%.... I favor elimination of the expat $91K deduction and the deduction for foreign tax payments. It's hardly fair that I pay more so that they can pay less just because they choose to live someplace else.[/QUOTE]Hardly fair? How is it fair that an American living and working in Argentina or Japan or wherever should pay tax twice? So I guess he should pay around 70% , while your rate should be 11%? That principal applied to American business, no credits or deductions for foreign taxes paid, would shut us out of world markets.
All the percentages are the actual percentage of AGI paid as federal income tax. Since it's a sliding scale based on taxable income (AGI less deductions) I have a 25% marginal rate but only pay a total of 11%. I'd lose 25% of every extra dollar I earned but Obama's actual percentage is getting close to his marginal because his income was so much larger than mine.
My larger point is that that "fair" is an almost completely subjective judgment so it's impossible to have a real discussion based on "fairness". One person thinks a progressive system is fairer, another thinks that a flat percentage is fairer, while a third just thinks it would be fairer if he paid less because he chooses to live in Argentina. Nothing anybody can say will change their opinion about what is "fair". On the other hand, arguments based on transparency, ease of enforcement, efficiency, and economic incentives can be fact-based so actually have a chance to create consensus.
I'm not totally unsympathetic to the problem of double taxation so I'm open to arguments about retaining foreign tax credits (although that the US should always take the hit hardly seems fair, ha! But I fail to see any reason that expats deserve a special deduction for not being in the country for 330 out of 365 days. Some minuscule percentage of my federal taxes pay for benefits that I directly receive so it's hard to see most of it as anything but the overhead of being an US citizen. People that don't want to pay are welcome to become citizens of another country and renounce their US citizenship.
The tax system works by taxing money when it flows from one taxable entity to another. I see nothing special about money flowing from companies to stockholders, e. G. Dividends that warrants special tax treatment. It's something that people consider when they choose to purchase a dividend paying stock.
Buffet's secretary pays at a higher rate because he's including FICA and Medicare in the calculation.
[QUOTE=Easy Go]The tax system works by taxing money when it flows from one taxable entity to another. I see nothing special about money flowing from companies to stockholders, e. g. dividends that warrants special tax treatment. It's something that people consider when they choose to purchase a dividend paying stock.[/QUOTE]Easy Go,
Take two corporations. It's the year 2013 and the tax rate on dividends has increased to 43.4%. Company A sells sand and gravel that's used for construction in the Detroit area. It's not growing, it's in a competitive business, there's overcapacity locally, and it produces, say a 6% return on equity. It does produce a lot of free cash flow, because it's not having to invest in new equipment.
Company B, also in Detroit, makes components for Iphones. It's growing and expected to continue to grow 20% per year and produces a 25% return on equity. But it requires a lot of cash to increase capacity.
So, how does money get from Company A to Company B? The best way is for A to pay dividends to owners who then invest in B. But A's shareholders, each of whom is in the maximum marginal tax bracket and who live in Michigan, will pay 48% tax on dividends they receive (43.4% federal rate + state income taxes). Maybe the owners manage Company A. Or maybe it's a professional manager who would like to empire-build -- regardless of whether Company A has good investment opportunities, if the professional manager can grow the company, his salary, his options, his profit sharing, etc. are likely to go up. In any event, Company A is going to retain the earnings in the business, instead of distributing to shareholders who could invest in more productive businesses.
Prior to the Bush tax cuts, U. S. Corporations paid among the lowest dividends in the world. Dividend yields were around 1% to 1.5%. That's during periods when P/E ratios were comparable to what they are now. Now dividend yields are higher, in the range of 2% to 3% , although still lower than much of the rest of the world.
If you look at the fastest growing economies in the world, in Asia, they have low taxes on dividends (0% to 10%) or they give tax credits to dividend payees for corporate income taxes, or they have much lower taxes on corporate income than we do. Or some combination of the preceding. I'm not saying this is THE reason for their faster growth. It is one of the reasons. To be fair, this isn't just true of Asian countries. Come 2011, the combined U.S. tax rate on corporations and dividends will be the highest or among the highest in the world. And, also to be fair, this isn't Obama's fault, as he favors a 20% tax on dividends. It's the Congressional Democrats, who have sworn that all the Bush tax cuts must expire for higher-income Americans.
On the issue of fairness, maybe you and I have different attitudes towards just exactly what a stock is. Your view may be that it's a piece of paper to be traded. And if the stock doesn't pay dividends, doesn't produce free cash flow, and never will, then I agree, it's a piece of paper. When I buy a stock, I'm buying part of a business. I expect to ultimately receive dividends, over many years, that will ultimately pay for my investment. I'm one of the owners of the business. I pay tax two times, once when my business receives the income and again when it pays dividends.
When I buy a stock, I plan to sell it some day at a tidy profit and pay, at most, capital gain rates on the sale. Dividends are for suckers (and Exon) because historically they have higher interest rates (the last few years have been an aberration) and the company, not me, controls when I have to recognize income and pay taxes. The idea that a stock has to eventually pay dividends to have any value has a certain emotional and logical appeal but there's no sign it has any practical significance.
It's an interesting idea that dividends are the primary way that capital flows between businesses. Any data or studies that back that up or is it just an theoretical argument from an Econ 101 textbook?
Chief executives have huge egos. Do you really think that they pay dividends because they think stock owners have better investment ideas and opportunities than the brilliant man at the top? Companies pay dividends for lots of reasons but I'm skeptical that "enabling the efficient flow of capital to better business than mine" is high on the list.
Easy Go,
I agree with most of what you wrote, if you're writing specifically about the U. S. It often makes more sense for a corporation to load up on debt, and pay tax-deductible interest expense, instead of issuing equity and distributing highly-taxed dividends. The market can be a giant shell game, with traders playing a game of musical chairs, looking for capital gains instead of investing long term in a business that produces or that will someday produce free cash flow and pay dividends. CEO's do have huge egos, and would love another excuse (like high taxes on dividends) to empire-build, instead of distributing part of the profits to shareholders. And dividends in the US aren't one of the primary means of reallocating capital, or at least they won't be after January 1, 2011 when the Bush tax cuts expire.
None of this is good, in my opinion.
Hey guys there is too much here for me to respond to everything, plus I'm packing my luggage to leave on a long awaited mongering trip. Not to BA though. I visited BA this time of year a few years ago, and decided I didn't like the city as much in the cooler weather so now I only come down in the BA spring / summer.
It is good to see some more intelligent discussion lately, that has always been my hope and interest here. Fact is I've never really had a vigorous, extensive left vs. right debate before, not like this thread, and it has been enjoyable (and frustrating) and I've learned a few things.
[QUOTE=Jackson]Now, Esten, will you stop injecting pointless smoke screens in the middle of your arguments?[/QUOTE]Jackson you don't even say what you're referring to or why you think it's 'smoke'. I'll assume you are referring to the Warren Buffett anecdote. If 'smoke' means non-factual or off-topic, then you are just wrong. The topic was taxes and the wealthy. His Forbes 400 challenge is a great illustration of tax disparities between the very wealthy and the middle class. And the fact that some wealthy individuals like Buffett disagree with Republican taxation policies (which favor the rich) is absolutely relevant.
[QUOTE=Wild Walleye]My dear Esten, do you really think he has shown backbone regarding special interests? If so, which ones? In my opinion, the blood of this president is imbued with special interest money, he cannot separate himself from it. [/QUOTE]I think he has shown resolve in his efforts to reform healthcare and his intentions to shift more of the tax burden back to the very wealthy, and there are certainly special interests who oppose those efforts. I could make a list (eg. insurance companies, big oil, etc) and I'm sure you can make a list you think he is supporting also, but I would add there is a difference between defending special interests and working with them to achieve broader goals for society.
The administration's recent support for Blanche Lincoln in Arkansas demonstrates they do not always side with unions.
And this story about the U.S. Chamber of Commerce planning an aggressive last ditch effort to kill the (Obama/Dem supported) financial reform bill, is very telling:
Business groups mount final push against reform bill
[url]http://www.reuters.com/article/idINN0114430920100701[/url]
[QUOTE=El Queso]I know he hasn't spent all the money yet - and if in fact the economy is turning around why not stop? Why do we have to spend it all?[/QUOTE]I surmise the economists believe the economy is showing signs of turning around, but a recovery is not firmly in place yet. And that until a recovery is clearly in place that some stimulus continues to be appropriate. It sounds plausible to me and I'm not going to second guess it.
[QUOTE=El Queso]And what, exactly, HAS the stimulus done? [/QUOTE]Please spend some time on recovery.gov. 682,370 jobs, numerous worthwhile projects and resultant expenditures flowing through the economy. You should read up on how the Republicans, while outwardly opposed to the stimulus bill, in private were relieved that it passed. And also read up on all the Republicans who praised the funding for various projects that were approved in their districts.
[QUOTE=El Queso]How can you say that when over the last few days the Democrats are talking about another stimulus bill, though smaller to be sure, and Obama himself told the leaders of nations who have notoriuosly overspent on social programs that we must keep the spending up, while they are telling him - enough, we have to cut budgets and stop spending so much?[/QUOTE]Also read what he said after the G20 about facing difficult decisions next year (on spending) and hoping that those hollering about deficits and debt will step up to join him. I wonder if the GOP will really live up to their rhetoric about cutting spending?
About oil and the environment, I said before I'm also not convinced about global warming. But I'm not going to take your word that we aren't running out of oil. And I don't think we can leave something like that to the free market, because most of the time in the free market, when something becomes cost prohibitive we have adequate alternatives, but in the case of oil, there is no guarantee we'll have made enough progress to continue our way of life without oil by the time we learn we only have 10 or 20 years of oil left. There are scenarios where it could get real ugly, why not plan to avoid that?
[QUOTE=El Queso]The big difference is that the left thinks people are incapable of making the decisions as to what should be done, and therefore think they do and they should control it. The people on the right think that people are motivated by personal self-interest and that they will always find a way to succeed if they are just left alone.[/QUOTE]Please stop repeating that bulls**t, it just isn't true. The left believes in addressing the abuses of free market capitalism and other issues that the private sector cannot. Aside from that, both left and right believe in the value of individual effort to succeed - that's the American way, not just the conservative way.
[QUOTE=El Queso]Again, as I've stated a few times now, but you have ignored, what other system has ever raised so many people out of poverty int he history of the world? What country's poor live better than kings of the past in many ways and certainly live like middle class in other countries (Argentina being one of them)[/QUOTE]I agree we have a remarkable system. But you know there are various quality of life metrics where the US falls behind many other countries. Dems believe we can and should address certain issues to make the country an even better place to live. Our system creates tremendous wealth but concentrates most of it in the top 5%. Dems think we just aren't getting the 'bang for our buck' in allowing wealth to be concentrated in such an extreme manner. More on this later, this in fact is the whole part of this debate that intrigues me the most, the laissez-faire attitude of the right that continuous and extreme wealth concentration is the best model for the country.
[QUOTE=El Queso]Have you seen the massive polls that have come out in the last week? Including polls by NBC and many supposedly "mainstream" organizations? That say 60+% of the country's population think we are headed the wrong direction? Man, you are sheltering in the shade of bad information. The country as a whole does not like what Obama is trying to do. At every turn he is telling the country that HE knows better than we what we should be concentrating on, how what we are concentrating on should be done, and doing everything possible to downplay ANY suggestions from the "right."[/QUOTE]That 60% has to be taken in the context of the recession and now the oil spill. Any president would be getting those numbers.
Can you tell me why the country 'as a whole' consistently has shown the following: Obama job approval > Democratic Party favorable rating > Republican Party favorable rating?
I'm leaving for a 10-day trip to a city with numerous upscale night clubs filled with hot Colombian women. It's going to be a Golden Time.
Tiny you posted some great stuff. I don't believe prosperity comes from wealth redistribution, see my comments to El Queso. I agree with you about small and medium-size businesses. I am more concerned about the power and wealth held by large corporations and the top 5% wealthy. I have one main question for you:
[i]Do you think there ever comes a point where allowing wealth to be concentrated with rich people is no longer in the best interest of society? [/i]
[QUOTE=Esten] I am more concerned about the power and wealth held by large corporations and the top 5% wealthy. I have one main question for you:
[I]Do you think there ever comes a point where allowing wealth to be concentrated with rich people is no longer in the best interest of society? [/i][/QUOTE]Yes, and it has nothing to do with the Gini coefficient. It's when a government, like Mexico's, allows certain individuals and businesses to have unfair competitive advantages, so that they're able to take advantage of the consumer. This is why wealth is so concentrated in Latin America. But the solution isn't taxes, it's making sure there's a level playing field for all competitors.
I'm a fan of the Singapore model. A good, appropriate education and good health care should be available for all. People should have savings for retirement. This should be accomplished efficiently, and preferentially by people paying for it themselves. If someone's not able, then the government and private charities should step in. Anyway, once that's done, the rest will take care of itself.
Higher taxes on capital and business profits would indeed take power and wealth away from the top 5%. It would instead put more wealth and power into the hands of the government, pension funds, institutions, and foreign central banks. (Aside: Lower levels of savings and investment here in the US, because of higher taxes on capital, means we'll run larger current account deficits, and more of our savings and investment will be held by countries like China, that are accumulating dollars.)
I'd rather see entrepeneurs and businessmen and individual investors control capital. They should live and die, figuratively speaking, based on how hard they work and the decisions they make. That's what creates the most efficient, vibrant economy.
If you want to tax Mercedes or $2 million houses or expensive cognac, fine. But taking capital away from those who have shown they're using it the most efficiently and channeling it to others is not a good idea.
[QUOTE=Black Shirt]Maybe this is BS, but I would like to say it anyway.
We all like to live well, and everyone's standard of living well is quite diverse. From a personal perspective, I know that I need less of most basic consumer products as I get older. But still, I buy more than I really need in terms of food, clothes, gadgets, travel, etc. So why? One big reason is that we live in a consumer society, we are told that we need X products to be happier / successful via mass media. Remember, when you went to the supermarket for toilet paper and came back with 5 other products. The malls are packed to a frenzy most weekends not only in Europe and the US, but everywhere in the world. And now, if we stop buying, the world will come to an end.
Thanks for letting me rant. Don't take it too seriously, we are never going to run out of anything, even money.[/QUOTE]I got it, I have been diagnosed. Tom Brokaw broke the news to me on CNBC. It's call chronic consumerism and is now a world wide disease. It started with the boomer generation (USA) and is now at it's peak. For symptons, just check your closet and garage.