GOP TAX PLAN

[detbuch]

Their is the confusing message I'm getting from leftists. The middle class, they say, is disappearing. This is happening under the current tax rates. If those rates are lowered, that is supposed to hurt the middle class. What middle class? Isn't it disappearing?

What, exactly is this thing called the "middle class"? Is it an income thing? If it is by income, and most people work for small rather than large businesses, wouldn't the existence of more and pricier small business transactions occurring in relation to those of large businesses be desirable? Wouldn't regulations favoring small businesses over large ones be preferable? Shouldn't the Big government Big Business complex (monopoly) be busted? How is that process even begun?

[zimmy]

Originally Posted by detbuch

Their is the confusing message I'm getting from leftists. The middle class, they say, is disappearing. This is happening under the current tax rates. If those rates are lowered, that is supposed to hurt the middle class. What middle class? Isn't it disappearing?

What, exactly is this thing called the "middle class"? Is it an income thing? If it is by income, and most people work for small rather than large businesses, wouldn't the existence of more and pricier small business transactions occurring in relation to those of large businesses be desirable? Wouldn't regulations favoring small businesses over large ones be preferable? Shouldn't the Big government Big Business complex (monopoly) be busted? How is that process even begun?

You aren't as confused as you appear. Small business is critical. The effective impact of the bill is that it does very little to help small business. The GOP for decades has stood with policies that favor big business over small business. The middle class is shrinking, but mostly because of downward mobility. Not what middle class means by definition, but what the standard of living for the middle class is today compared to what it used to be. This tax bill will likely continue the trend or increase it with the slimmest to no chance that it reverses it.

[scottw]

some of you should be wearing tutu's and shaking pom poms rooting for this tax bill...if you are correct it will guarantee gropin' Joe the white house in 2020 and the dems the house and senate(maybe sooner)...then everything will get fixed

[spence]

Originally Posted by scottw

some of you should be wearing tutu's and shaking pom poms rooting for this tax bill...if you are correct it will guarantee gropin' Joe the white house in 2020 and the dems the house and senate(maybe sooner)...then everything will get fixed

No, these bills as written now will do real structural harm...it's going to be a decade at least before we could even begin to repair. Get ready for 2 trillion dollar deficits as the new normal.

I'm still waiting for anyone to show me how giving corporations already making record profits a lot more money, and creating record deficits in the process, is going to create growth or lead to higher wages.

Where's the expert testimony? Where's the CBO analysis? The lack of thought going into this tax plan appears to just highlight the ruse, it's a payback scheme for years of Republican political support.

[detbuch]

Originally Posted by spence

No, these bills as written now will do real structural harm...it's going to be a decade at least before we could even begin to repair. Get ready for 2 trillion dollar deficits as the new normal.

Which "structure"? The Progressive structure certainly hasn't been supported by balanced budgets. Is there something you would like to see repaired in the Progressive structure? Other than that politicians should act what you consider "responsibly"?

I'm still waiting for anyone to show me how giving corporations already making record profits a lot more money, and creating record deficits in the process, is going to create growth or lead to higher wages.

So should the tax plan include a proviso that corporations making record profits (in inflated currency) should not participate in the lowered tax rates that other corporations and businesses will get?

Where's the expert testimony? Where's the CBO analysis? The lack of thought going into this tax plan appears to just highlight the ruse, it's a payback scheme for years of Republican political support.

Testimony?? What . . . is this a trial? So you're saying that no so-called "experts" contributed to the tax plan? How often has the CBO been wrong? You're either very cynical or very partisan. Or you just like to rant.

[Got Stripers]

Originally Posted by detbuch

Or you just like to rant.

[detbuch]

Originally Posted by Got Stripers

Right back at ya. Spence likes to refer to posts he doesn't refute as rants. I threw that tidbit right back at him. And to anyone else who deflects merely by characterizing a post as a rant.

[spence]

Originally Posted by detbuch

Which "structure"? The Progressive structure certainly hasn't been supported by balanced budgets. Is there something you would like to see repaired in the Progressive structure? Other than that politicians should act what you consider "responsibly"?

Sound logic. It's like, we're already screwed so let's just make the problem worse.

So should the tax plan include a proviso that corporations making record profits (in inflated currency) should not participate in the lowered tax rates that other corporations and businesses will get?

Corporations today on average are not over taxed. How about you apply revenue to things that will make the country stronger like infrastructure, research, education and debt reduction.

If there are variations in the tax code more favorable to one industry or not...then propose reform.

Testimony?? What . . . is this a trial? So you're saying that no so-called "experts" contributed to the tax plan? How often has the CBO been wrong? You're either very cynical or very partisan. Or you just like to rant.

if you're so confident in the tax proposals promoting long-term growth wouldn't you bring the economists before congress to participate in a bi-partisan discussion?

Crickets.

[detbuch]

Originally Posted by spence

Sound logic. It's like, we're already screwed so let's just make the problem worse.

Wasn't an exercise in logic. I asked you three questions. If this is your answer, it sounds as if you prefer to stay screwed. And there is a dispute about whether the tax proposal will "make the problem worse" or make a less of a problem.

Corporations today on average are not over taxed. How about you apply revenue to things that will make the country stronger like infrastructure, research, education and debt reduction.

What standard are you applying? "On average," even if that were true, means that half are overtaxed, or that half the countries tax less. Either is a problem that can be fixed by taxing less.

And how about applying the taxes with which you seem to think are now adequate (or do you want them to be higher?) to pay for those things you listed? How much of the "stimulus" went to infrastructure as was promised? Why is the federal government funding education? When does the federal government, now or ever since Coolidge, apply revenue to debt reduction in a meaningful way except to just pay the interest on the debt?

And doesn't making the private sector "stronger" make the country stronger? Well, no, not in a Progressive structure.

if you're so confident in the tax proposals promoting long-term growth wouldn't you bring the economists before congress to participate in a bi-partisan discussion?

Crickets.

Bring your tax proposal before Congress in a bi-partisan discussion? That would be the surest way to trash it. The opposition party, in our time, is diametrically opposed to the other. Each party scrambles to get enough of a majority so that it can ram its agenda through without the squelching charade of a bi-partisan "discussion." Get serious.

Anyway, as it is, the GOP keeps caving, due to partisan pressures, on its initial proposals. I really liked the original idea of a 15% corporate tax rate, or less. Was very disappointed when that figure went up.

[scottw]

Originally Posted by spence

No, these bills as written now will do real structural harm...it's going to be a decade at least before we could even begin to repair. Get ready for 2 trillion dollar deficits as the new normal.

given how frequently you are wrong...I'll just assume this on that..or that on this

[spence]

Originally Posted by scottw

given how frequently you are wrong...I'll just assume this on that..or that on this

Have I ever been wrong?

Have I ever used the word "rant?"

[Fishpart]

Taxes

Are Red States Tax Takers And Blue States Tax Makers?
Against a national average of $1,935 in intergovernmental spending per American, red states receive just $1,879. Blue states get considerably more, at $2,124 per resident.
Kyle Sammin
By Kyle Sammin
November 17, 2017

With every debate on taxing and spending in Washington comes inevitable references to which states send more in taxes to the federal treasury than they receive in benefits for their citizens. The figures thrown around are sourced differently and vary widely, but the point of it all is for Democrats to point at poor, Republican states and call them hypocrites for doing exactly what Democrats say they should: taking money from richer places.

But how much of it is true? An op-ed in The New York Times this week accuses Republicans of favoring red states over blues ones in their plans, while repeating the old lie that small states’ equal representation in the Senate favors Republicans (the ten smallest states are currently represented there by nine Republicans, nine Democrats, and two independents who caucus with the Democrats; the ten largest states are represented by nine Republicans and eleven Democrats).

What kind of spending are they talking about? And what is behind these claims, which pit one part of the population against the other?
Who Pays More Taxes?

Let’s start with the taxes paid. In fiscal year 2016, the Internal Revenue Service collected a record $3.3 trillion in taxes nationwide. That money came from a total population of 312,471,695, according to the most recent census (for this article, the figures will only include the 50 states, Washington DC, and Puerto Rico). That gives us a national average of $10,622 in taxes for each American.

Even that figure is a little misleading, because the taxes collected include estate taxes, unemployment taxes, business taxes, and excises, which cannot be accurately attributed to one person. If we want to talk about individual income taxes only, the figure is a slightly lower $9,216 per person.

So do blue states pay more than red ones? Again, defining terms is important in answering the question. For this article, we’ll call states that voted for the Democratic candidate for president in 2008, 2012, and 2016 blue states. Those that voted Republican all three years are red, and those that shifted in different elections are purple.

The result: Democrats are correct on this fact. The blue states did pay more per capita in federal taxes than the red did. The $12,648 per capita taxation there is 118 percent of the national average. The purple states fell in between the two, slightly below the national average.

What accounts for the difference? Blue states are, on average, richer. Because we have a progressive tax system, more money comes from richer people, and if a state’s citizens are, on average, richer, they pay more into the federal fisc. The per capita income in the United States, according to the American Community Survey, is $28,889. In blue states, the figure is higher, at $32,295, which is 112 percent of the national average. The figures in the purple and red states are closer to the national average: the purple per capita income is $27,040 (94 percent of the national average) and in the red states the figure is $25,633 (89 percent of the national average).

Even with a flat tax, the rich pay more dollars of tax. The “flat” adjective refers only to the rate, so under a flat tax the rich still pay more, just not disproportionately more. But even so, the effective taxes paid in blue states are not very much higher than that of the reds and purples.

The IRS collected taxes equal to 37.03 percent of the income earned in America (again, this includes non-individual income taxes collected in a state, such as corporate tax and excises). In the blue states, the figure is a little higher: 39.16 percent. In the purples and reds, it is a little lower: 36.37 percent and 34.29 percent, respectively.

None of this is surprising. What is surprising is that Democrats often act like the red states are getting away with something. Progressive ideology has as one of its central tenets the idea that money should be transferred from the rich to the poor. In our progressive tax code, they have succeeded in enacting the first part of that equation. The only strange part is that they look askance at the poorer regions of the country for simply obeying the tax code.
Who Gets More Benefits?

How much the federal government takes in taxes is simple question. How much they pay out gets more complicated.

One way of looking at it is to see what percentage of states’ budgets are paid for by direct transfers of federal funds. That was the analysis done in a Pew Trusts report in July 2017, based on federal government data from fiscal year 2015. Intergovernmental transfers from the feds to the states include the money used to pay for programs that Washington funds but the states administer. About half goes to health-care programs; education and transportation spending also come out of these funds. They also include welfare programs, grants to local police forces, and other indirect federal spending within a state (this 2013 CBO report gives more details).

The results are somewhat at odds with the claims on the Left that the red states are takers while the blue states are makers. Of the ten states with the lowest percentage of funds coming from Washington, three are red, six are blue, and one is purple. The state with by far the lowest level of federal subsidization was the deeply red state of North Dakota. The highest ten included eight red states, but also two blue states: Oregon and New Mexico. (DC and Puerto Rico are excluded from these calculations because their relationships with the federal government are different than if they were states.)

On average, the three groups were not that far apart. Against a national average of 32.62 percent federal subsidy, the blue states received 30.80 percent. Purple states were almost exactly at the national level with 32.92 percent coming from Washington. Red state budgets averaged 35.75 percent federal money. As with the taxes, there is a slight tilt to one side, but nowhere near what you would think based on complaints from the Left.

A problem with this metric is that although federal funds make up a larger percentage of red states’ state budgets, the budgets in those states are generally lower overall than those of the free-spending blue states. If, instead of comparing federal funds to state budgets, we look at how much the federal government spends in intergovernmental grants per resident of a state, the results are turned on their heads.

Against a national average of $1,935 in intergovernmental spending per American, red states receive just $1,879. Blue states get considerably more, at $2,124 per resident. Purple states see the least of their money returned to them per capita, at just $1,770. Measured in this way, the blue states are getting quite a bit more than the red or purple.

Which States Get the Most of What They Paid?

The answer to the ultimate question requires us to compare what the states pay in and what they get back. Immediately, though, we have to understand that these intergovernmental transfers—the source of most calculations about these claims—are only a fraction of what the federal government spends. In 2016, the federal budget called for $3.9 trillion in spending, of which just $604 billion was in intergovernmental transfers. All of the claims about which states take what, therefore, are based on an analysis of just 15 percent of all federal spending.

Even within that limited range of figures, the results are not the open-and-shut case that critics from the Left would have us believe. For one thing: no state receives more in intergovernmental transfers than its citizens and corporations pay in federal taxes. The state that gets the most back in intergovernmental transfers is a blue state, New Mexico, at 80.27 percent. Red states West Virginia and Mississippi are the only other two that get back more than half of their taxes in this form of spending (67.30 percent and 63.12 percent, respectively).

This tells us nothing about the politics of those places, only that they are, on average, poorer, and therefore more eligible for federal programs for their residents. Delaware receives the smallest percentage back—9.89 percent. Again, this is probably a result of the disproportionate amount of corporate and trust income taxes coming from that state, not because of the politics of their state.
What About The Rest?

Other studies claim to take in the remaining 85 percent of federal spending and divvy it up among the states. Another Pew study does that through various methods, some of which make sense, others of which are harder to justify.

Nearly two-thirds of spending, they note, goes to individuals, not to state governments or groups. That makes it more difficult to attribute to one state. If a couple from Michigan retires and spends five months each year in Florida, to which state are their Social Security checks attributed? Their legal residence may be in Grand Rapids, but it is quite possible that they spend more of their money in Tampa.
As long as other people pay for you to survive, they will demand to control how you live.

There is also the matter of military spending, a large part of the federal budget. As Pew notes, military spending is spread unevenly across the states. That is as much through accident of history—where bases are located—than because of any twenty-first-century military need.

But the confusion goes even beyond that. Many of our military bases are located overseas. On all bases and ships, the men and women serving are from states and territories around the country. Does a Marine in Guam have his paycheck attributed to that territory, or to his home state? Doesn’t defense spending benefit all Americans, no matter where the check is cashed? What does the location matter?

It matters only in so far as the politicians and pundits who cite these statistics do so in an effort to divide us. The idea of a Blue America and a Red America is a dangerous one, but it is a tempting weapon to yield for a politician who wants to rally his base. State governments like California’s use these figures to justify their own righteousness and demand that, as net “donors” to the American republic, they be given more deference, and more power. (Even in that chart, note that the top donor state is red and the top recipient is blue).

This is a common refrain from the rich to the poor throughout history: they pay for something, so they must be allowed to control it, and to control the people that receive it. Indeed, that it is so consistently demanded shows why massive spending is incompatible with a free people. As long as other people pay for you to survive, they will demand to control how you live.

Politicians love to use fuzzy statistics like these to do so, and will always find an audience for their claims. As our government continues to expand in scope and size, we should consider this another reason to resist.
Kyle Sammin is a lawyer and writer from Pennsylvania. Read some of his other writing at kylesammin.com, or follow him on Twitter @KyleSammin.

[scottw]

Originally Posted by spence

Have I ever been wrong? on a regular basis

Have I ever used the word "rant?" I don't keep track

[scottw]

Originally Posted by detbuch

Shouldn't the Big government Big Business complex (monopoly) be busted? How is that process even begun?

when the dems are in charge it's a "partnership"...when the repubs are in charge it 'corporate welfare"

isn't it great?...the government keeps chunks of your earnings throughout the year and you either pay someone, invest in books or software and spend inordinate amounts of time figuring ways they
may have created for you to get some of it back and argue with other over who is getting screwed worse.....