Political Roundtable - Part V

[dckingsfan]

Increased tax rates go to only one of three ways:

1) increased costs on products and services
2) decreased dividends
3) decreased wages to employees

That's it... there isn't anything else there. And our corporate taxes being out of line have hit all three.

http://www.youtube.com/watch?v=ja9gEW2r4jU

[dckingsfan]

I reject the idea that if we just make corporations more profitable (by lowering their taxes)they will hire more people or increase their wages. It is my firm belief that corps or any other type of business hire people to meet the expected demand for the products and/or services that those prospective employees will supply. Period. They will increase wages when theyhave to in order to retain workers who can make them more/most profitable.

You are missing the point. Lower corporate tax rates make us more competitive allowing our corporations to charge less for their goods and services. That leads to either larger dividends or wages (and as you would say) PERIOD.

That is where the taxes should fall. They should fall on the dividends and wages paid from the corporations. And that is where we should close the loopholes. It does no good to close corporate loopholes and leave gaping holes in the individual tax rates - where the real wealth transfer is happening.

[dckingsfan]

And just to make sure that we are on the same page... Mr. Bartlett is referring (I am almost sure) to that same study from 2010. Just like employment forecasts, it was wrong and revised.

[dobrojim]

You're assuming prices on goods are set by or related to the cost of production.

They're not. Prices are set to maximize sales revenue.

Corps can sell more when people have more money to buy things.
As long as wages are stagnent or shrinking in real terms, growth can't happen.

[dobrojim]

And just to make sure that we are on the same page... Mr. Bartlett is referring (I am almost sure) to that same study from 2010. Just like employment forecasts, it was wrong and revised.

if you want to talk about wrong forecasts, just look at nearly every GOP politicians forecast
trying to justify their major economic policies.

[dobrojim]

I believe Mr Barlett's numbers were based on actual corp revenues paid relative to GDP.
Something would have to be incredibly amiss to take us from the bottom all the way to
the top. Something doesn't smell right.

[dckingsfan]

Corporations should have only one purpose--to make the most profit for their shareholders--and pursuit of that goal will be best for America in the long run.

--or--

Corporations should have more than one purpose. They also owe something to their workers and the communities in which they operate, and they should sometimes sacrifice some profit for the sake of making things better for their workers and communities.

An overwhelming 95 percent of Americans chose the second proposition. Clearly, this finding tells us that our fate is not sealed. When 95 percent of the public supports a proposition, enacting that proposition into law should not be impossible.

My questions would be:
1) What do 95 percent of Americans know about corporate bylaws? I would argue close to zero. If you ask someone, who should pay - big greedy corporations or those poor little guys over there - how do you think they will vote? When you say, sacrifice some profits you mean increase taxes which increase prices, reduce dividends or decrease wages. I think the question was framed incorrectly and the results would change with education.

2) How would enforcement work for those corporate statutes. Are you saying the federal government would enforce those rules - the NLRB? That would pretty much debilitate our corporations, no? Have any idea on the costs of regulation to corporations now? Triple that... but I guess that would work because we could triple the size of our enforcement - the NLRB could go to 20,000 - so I guess that works (sarcasm).

You are killing me here.

[W. Unseld]

I'm not sure why I bother, but here you go:
http://www.cbsnews.com/8301-505263_162- ... nce-plans/
CBS News has confirmed with insurance companies across the country that more than two million people are getting notices they no longer can keep their existing plans. In California, there are 279,000; in Michigan, 140,000; Florida, 300,000; and in New Jersey, 800,000. And those numbers are certain to go even higher.

Industry experts say about half the people getting the letters will pay more -- and half will pay less, thanks to taxpayer subsidies.

Admittedly 2 millions is even higher than I thought it would be but even if the forecast is off by 50% that's waaaaay too many and it's the opposite of what people were told. Apparently MSNBC ran something similar but took the article down and reposted it with one paragraph missing. The scuttlebut from my few remaining Cap. Hill buddies is that this whitehouse is less afraid than most to give you a scathing, threatening phone call. To be fair, every administration I have been alive for has apparently done the phone call before but this one apparently takes the cake for frequency and strongly prefers vinegar to sugar.

[dckingsfan]

And just to make sure that we are on the same page... Mr. Bartlett is referring (I am almost sure) to that same study from 2010. Just like employment forecasts, it was wrong and revised.

if you want to talk about wrong forecasts, just look at nearly every GOP politicians forecast trying to justify their major economic policies.

Sorry, I am not a Republican. Not even close. And I think they are just as much in the tax and spend camp. They use the rhetoric of cutting taxes and never do. They talk about cutting spending and never do. The are just as willing to increase spending to fund their own pet projects.

But using these willfully wrong statistics - shame on them. That is past deception and into deceit.

Think about it... you want to see job growth, you want to see the GDP grow, you don't want to see the 1 percent pay an effective tax rate of 12%. What is the best way to do that?

1) Reduce or eliminate corporate taxes
2) Remove or cap all individual deductions (that is where the money goes anyway
3) If you must raise taxes, do it through a VAT tax that doesn't penalize our local corporations
4) If there is anyway to do it, reduce the amount of red tape corporations need to go through

[dobrojim]

agree with much of the above - disagree with reduce or especially eliminate
/effective/ corp taxes. I see no evidence that doing that will lead to the goals
above.

[dckingsfan]

agree with much of the above - disagree with reduce or especially eliminate
/effective/ corp taxes. I see no evidence that doing that will lead to the goals
above.

OK, why do you think that raising corporate tax rates (especially keeping the loopholes) will meet the goals above?

How would it make our corporations more competitive?
How would it increase employment?
How would it increase dividends?

[dckingsfan]

I'm not sure why I bother, but here you go:
http://www.cbsnews.com/8301-505263_162- ... nce-plans/
CBS News has confirmed with insurance companies across the country that more than two million people are getting notices they no longer can keep their existing plans. In California, there are 279,000; in Michigan, 140,000; Florida, 300,000; and in New Jersey, 800,000. And those numbers are certain to go even higher.

Industry experts say about half the people getting the letters will pay more -- and half will pay less, thanks to taxpayer subsidies.

Admittedly 2 millions is even higher than I thought it would be but even if the forecast is off by 50% that's waaaaay too many and it's the opposite of what people were told. Apparently MSNBC ran something similar but took the article down and reposted it with one paragraph missing. The scuttlebut from my few remaining Cap. Hill buddies is that this whitehouse is less afraid than most to give you a scathing, threatening phone call. To be fair, every administration I have been alive for has apparently done the phone call before but this one apparently takes the cake for frequency and strongly prefers vinegar to sugar.

I wonder why the number turned out so high... I wouldn't have expected that at all. It would be bad if more lost coverage than gained coverage. Even if you don't like the law, you don't want this to fail.

[Nivek]

I think the reason people are "losing" their insurance policies is because the policies were so limited. ACA defines minimum coverages. Many existing plans fall below that minimum. Insurers have to drop those plans and replace them with plans that comply with the law. Something I read said that the legislation exempted plans that were in effect before some date in 2010, but the regulation writers narrowed that exemption by saying that a plan that had a significant change (I forget how it's defined, but it has to do with factors like increased deductibles, changes in coverages, significant premium changes) doesn't qualify for the exemption.

In my view, all this is further indication of ACA's needless complexity. This thing is designed to fit an ideology, not to be a good solution to providing healthcare and reducing overall costs.

[dckingsfan]

I think the reason people are "losing" their insurance policies is because the policies were so limited. ACA defines minimum coverages. Many existing plans fall below that minimum. Insurers have to drop those plans and replace them with plans that comply with the law. Something I read said that the legislation exempted plans that were in effect before some date in 2010, but the regulation writers narrowed that exemption by saying that a plan that had a significant change (I forget how it's defined, but it has to do with factors like increased deductibles, changes in coverages, significant premium changes) doesn't qualify for the exemption.

In my view, all this is further indication of ACA's needless complexity. This thing is designed to fit an ideology, not to be a good solution to providing healthcare and reducing overall costs.

Ugh, now I am reading that the plans have to cover maternity care, mental health treatment and pediatric dental care. If they were going to make it complex, why not have basic coverage for a single adult male without maternity and pediatric dental care?

[Nivek]

I think the reason people are "losing" their insurance policies is because the policies were so limited. ACA defines minimum coverages. Many existing plans fall below that minimum. Insurers have to drop those plans and replace them with plans that comply with the law. Something I read said that the legislation exempted plans that were in effect before some date in 2010, but the regulation writers narrowed that exemption by saying that a plan that had a significant change (I forget how it's defined, but it has to do with factors like increased deductibles, changes in coverages, significant premium changes) doesn't qualify for the exemption.

In my view, all this is further indication of ACA's needless complexity. This thing is designed to fit an ideology, not to be a good solution to providing healthcare and reducing overall costs.

Ugh, now I am reading that the plans have to cover maternity care, mental health treatment and pediatric dental care. If they were going to make it complex, why not have basic coverage for a single adult male without maternity and pediatric dental care?

Yeah. I think the argument goes something like -- to have enough money in the insurance pool, everyone has to pay for some things they don't personally "need." So, men pay for X coverage (even if they don't personally need that specific coverage), but women are doing the same paying for Y; young people are paying for Z while old folks are paying for H. Or something like that. Sorta like property owners paying taxes that fund public schools even if they don't have kids, or if those kids aren't attending public schools. Or roads even -- we all pay to construct and maintain roads we don't personally use.

At least that's what I think the argument is. We need an ACA expert in this thread.

[dckingsfan]

I think the reason people are "losing" their insurance policies is because the policies were so limited. ACA defines minimum coverages. Many existing plans fall below that minimum. Insurers have to drop those plans and replace them with plans that comply with the law. Something I read said that the legislation exempted plans that were in effect before some date in 2010, but the regulation writers narrowed that exemption by saying that a plan that had a significant change (I forget how it's defined, but it has to do with factors like increased deductibles, changes in coverages, significant premium changes) doesn't qualify for the exemption.

In my view, all this is further indication of ACA's needless complexity. This thing is designed to fit an ideology, not to be a good solution to providing healthcare and reducing overall costs.

Ugh, now I am reading that the plans have to cover maternity care, mental health treatment and pediatric dental care. If they were going to make it complex, why not have basic coverage for a single adult male without maternity and pediatric dental care?

Yeah. I think the argument goes something like -- to have enough money in the insurance pool, everyone has to pay for some things they don't personally "need." So, men pay for X coverage (even if they don't personally need that specific coverage), but women are doing the same paying for Y; young people are paying for Z while old folks are paying for H. Or something like that. Sorta like property owners paying taxes that fund public schools even if they don't have kids, or if those kids aren't attending public schools. Or roads even -- we all pay to construct and maintain roads we don't personally use.

At least that's what I think the argument is. We need an ACA expert in this thread.

That makes sense... hence why healthy young people have to be enrolled to pay for heavy users of the medical system. Although that doesn't fix the problem, it does shift the financial burden off of the governments back and onto young peoples backs. I guess that is a double wammy with young folks paying more than their share for SS, Medicare and Medicaid.

[dckingsfan]

BTW, I think I may see where the anomaly is... Many of the largest corporations are multi-national. As they begin to earn profits abroad then it skews the chart to which he was referring.

So... if those corporations have earnings abroad (and pay taxes abroad) then it will make it look like they are not paying their fair share locally. Which hasn't been the case with the exception of corporations that have large tax breaks.

Again, you would get more local revenue by having no (or low) tax rates and by allowing corporations to repatriate revenues earned abroad at very low rates. The corporations would then do one of two things, invest the money locally or pay dividends, either work in your scenario. That is unless the only goal is to "look fair". In which case it is better to give big tax breaks to favored corporations.

[Wizardspride]

http://money.cnn.com/2013/10/30/news/ec ... ?hpt=hp_t2

U.S. deficit falls to $680 billion

[dckingsfan]

http://money.cnn.com/2013/10/30/news/economy/deficit-2013-treasury/index.html?hpt=hp_t2

U.S. deficit falls to $680 billion

Several factors have contributed to the strong improvement in the nation's near-term fiscal picture. They include an improving economy and a mix of fiscal restraint -- primarily, the expiration of stimulus measures, the imposition of across-the-board budget cuts known as the sequester, and tax increases on high-income households during the 2013 fiscal year, which ended September 30.

That is all good news... now they have to keep the momentum going. Don't let the sequester expire don't add any new stimulus measures and we will be fine.... at least in the short term - something is going to have to be done about the entitlements.

Independent budget experts' concern, however, is not about the country's deficits over the next 10 years. Their concern is about the subsequent decades when spending on major entitlement programs, as well as interest on the debt, will consume much larger portions of the budget while revenue is not expected to increase enough to keep pace.

[dckingsfan]

Overall, spending in 2013 totaled 20.8% of GDP, down from 22% the year before, thanks in part to declines in defense spending and unemployment benefits, as well as the sequester. Among the areas where annual spending rose were Social Security and Medicare.

We need to gat that down into the 18% or less to see real growth.