Republicans call proposed middle class tax cut a tax hike

[Jarhyn]

If it's revenue neutral then as far as the economy cares it's not a tax increase.

That would be incorrect - it's a tax increase to pay for additional spending, and will have effects on the economy as a result.

No. It's a new tax on high volume trading. It isn't a tax hike; it's a new tax. And it's a new tax that doesn't take anything from anyone who isn't already disgustingly rich. It will have an impact on the economy: Joe Average will have more money to spend on things like food and houses and bills. Joe average will spend that power on things, which will fund the people who make those things, and the wheels of the economy turn with the movement of that money.

 

[laughing dog]

A new tax is a tax increase since the tax rate was zero before the new tax.

 

[Jarhyn]

It's a tax hike on the richest of the disgustingly rich, and pretty much nobody else. It's not a 'tax hike' for anyone else. Saying it's a tax hike on a broad level is not accurate because it is not a tax hike for the audience they can be reasonably sure they will reach.

You could list the names of people or organizations for whom it IS a tax hike on a single sheet of printer paper. I think the harder issue is that the revenue from it will not be as advertised: people will scale back on high volume day trading that this targets and use other similar but untaxed methods instead.

It will have liquidity effects as well as applying to people who buy stock through their 401ks. Generally, less liquidity will increase the spread between the bid and the ask (meaning that the market makers earn a higher profit per trade, a hidden tax of sorts) and generally increase price volatility due to less supply of orders on the market (meaning any particularly large order will affect price by more than it does currently).

Those orders ultimately originate with the middle class and the poor who need things. Putting those dollars into the pockets of people means they will spend them. They will ask fellow people to do things in exchange for those dollars. They do not currently have dollars to use to ask for people to do things. More dollars distributed among more people means more churn of dollars and ultimately more activity.

At some point there will be an equilibrium point between the usefulness of power vs it's availability.

 

[Axulus]

That would be incorrect - it's a tax increase to pay for additional spending, and will have effects on the economy as a result.

No. It's a new tax on high volume trading. It isn't a tax hike; it's a new tax. And it's a new tax that doesn't take anything from anyone who isn't already disgustingly rich. It will have an impact on the economy: Joe Average will have more money to spend on things like food and houses and bills. Joe average will spend that power on things, which will fund the people who make those things, and the wheels of the economy turn with the movement of that money.

There is no way they can raise hundreds of billions with just this one tax without seriously fucking up our capital markets. If you think otherwise, you are living in fantasy world. Time to get out of that bubble.

 

[Jimmy Higgins]

If it's revenue neutral then as far as the economy cares it's not a tax increase.

That would be incorrect - it's a tax increase to pay for additional spending, and will have effects on the economy as a result.

This stuff gives me headaches.

I pay $8,000 in Federal Taxes. But the Government gives me back $2,000 as part of a new credit. Is that credit new spending?

*removed analogy that may not have been analogous*

The problem may be, the Government doesn't actually have the cash to give back without borrowing to do so.

 

[Bronzeage]

A reduction in tax liabilities for the middle class that is funded by an increase in tax liabilities for the rich can be termed a "tax cut" or a "tax increase". I have not seen whether this proposal means an overall reduction or increase in expected tax liabilities.

We call this a "revenue realignment."

 

[Jimmy Higgins]

A reduction in tax liabilities for the middle class that is funded by an increase in tax liabilities for the rich can be termed a "tax cut" or a "tax increase". I have not seen whether this proposal means an overall reduction or increase in expected tax liabilities.

We call this a "revenue realignment."

No, "income tax smoothing".

 

[ksen]

If it's revenue neutral then as far as the economy cares it's not a tax increase.

That would be incorrect - it's a tax increase to pay for additional spending, and will have effects on the economy as a result.

What additional spending?

Over the last 20 years I've heard right wing radio and pundits and politicians make it absolutely clear that tax cuts are not additional spending.

 

[Axulus]

That would be incorrect - it's a tax increase to pay for additional spending, and will have effects on the economy as a result.

This stuff gives me headaches.

I pay $8,000 in Federal Taxes. But the Government gives me back $2,000 as part of a new credit. Is that credit new spending?

*removed analogy that may not have been analogous*

The problem may be, the Government doesn't actually have the cash to give back without borrowing to do so.

The amount you get back has no relation to the amount you paid in, whether it is $0 or $10,000. It would be like getting 2 free shirts regardless of how many shirts you buy. If the government gave everyone two free shirts, would you call that a tax cut equal to the dollar value of the shirts?

 

[Axulus]

That would be incorrect - it's a tax increase to pay for additional spending, and will have effects on the economy as a result.

What additional spending?

Over the last 20 years I've heard right wing radio and pundits and politicians make it absolutely clear that tax cuts are not additional spending.

These are $1,000 and $2,000 checks to every household that makes under $100k or $200k. Just because the checks are paid by increasing one's tax refund or reducing one's tax liability (instead of sending a separate check in the mail) doesn't make a difference.

 

[Jarhyn]

No. It's a new tax on high volume trading. It isn't a tax hike; it's a new tax. And it's a new tax that doesn't take anything from anyone who isn't already disgustingly rich. It will have an impact on the economy: Joe Average will have more money to spend on things like food and houses and bills. Joe average will spend that power on things, which will fund the people who make those things, and the wheels of the economy turn with the movement of that money.

There is no way they can raise hundreds of billions with just this one tax without seriously fucking up our capital markets. If you think otherwise, you are living in fantasy world. Time to get out of that bubble.

It will CHANGE our capital markets. 'Fuck them up' not so much. They're fucked as they currently stand, that people can leverage what they have to have more, rather than to have the same level over power grounded in a different asset.

 

[laughing dog]

This stuff gives me headaches.

I pay $8,000 in Federal Taxes. But the Government gives me back $2,000 as part of a new credit. Is that credit new spending?

*removed analogy that may not have been analogous*

The problem may be, the Government doesn't actually have the cash to give back without borrowing to do so.

The amount you get back has no relation to the amount you paid in, whether it is $0 or $10,000. It would be like getting 2 free shirts regardless of how many shirts you buy. If the government gave everyone two free shirts, would you call that a tax cut equal to the dollar value of the shirts?

I think it is fascinating that a reduction in someone's tax liability is called a spending increase. The same people who make that claim do not call a reduction in tax rates that cause increases in the deficit "tax increases" when they will cause increases in future taxes.

 

[Axulus]

Is social security a tax cut for retirees?

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The amount you get back has no relation to the amount you paid in, whether it is $0 or $10,000. It would be like getting 2 free shirts regardless of how many shirts you buy. If the government gave everyone two free shirts, would you call that a tax cut equal to the dollar value of the shirts?

I think it is fascinating that a reduction in someone's tax liaiblity is called a spending increase. That assumes that those resources belonged to the government instead of the taxpayer's funds.

What's so fascinating about using correct words? Just because the IRS is the distribution method for the $1,000 and $2,000 checks doesn't mean it isn't spending. Are food stamps a reduction in someone's tax liability and therefore not spending (since they are paid from taxpayer's funds)? Would you change your answer if the IRS was the department responsible for distributing the food stamps? Why or why not?

 

[ksen]

What additional spending?

Over the last 20 years I've heard right wing radio and pundits and politicians make it absolutely clear that tax cuts are not additional spending.

These are $1,000 and $2,000 checks to every household that makes under $100k or $200k. Just because the checks are paid by increasing one's tax refund or reducing one's tax liability doesn't make a difference.

No, they're $1,000 and $2,000 tax credits.

And again, for the last 20 years conservatives have gone on ad nauseum about how tax cuts are not additional spending. You should call Rush and have him update that to "tax cuts are not additional spending unless democrats propose them."

 

[laughing dog]

Is social security a tax cut for retirees?

- - - Updated - - -

I think it is fascinating that a reduction in someone's tax liaiblity is called a spending increase. That assumes that those resources belonged to the government instead of the taxpayer's funds.

What's so fascinating about using correct words?

Nothing when that is don. In this case, the hypocrisy is fascinating.

 

[Jimmy Higgins]

What additional spending?

Over the last 20 years I've heard right wing radio and pundits and politicians make it absolutely clear that tax cuts are not additional spending.

These are $1,000 and $2,000 checks to every household that makes under $100k or $200k. Just because the checks are paid by increasing one's tax refund or reducing one's tax liability doesn't make a difference.

Maybe I'm burned out today from work, but is this just accounting bullshit? Not you personally or what you have stated, just the entire argument in general.

One argument is that you are just reducing revenue.
Instead of collecting $8k from me, they get $6k. That didn't cost the Government a dime in outlays, just reduced their revenue. To make up for the revenue shortfall, they tax some evil company who makes money by trading shares of stocks by tapping the main line to stock market and taking advantage of the lag in the speed of light to foresee a sale of stock and capitalize on it.

The other argument is that you are increasing spending.
They collected $8k. But increased their budget by $2k and paid me $2k. This spending increase is paid for by taxing evil companies that make a lot of money by adding no value to the nation's worth.

(8 - 2) + 2 = 8 + (- 2 + 2)?

The argument seems to be about where we put the parentheses.

 

[Axulus]

These are $1,000 and $2,000 checks to every household that makes under $100k or $200k. Just because the checks are paid by increasing one's tax refund or reducing one's tax liability doesn't make a difference.

No, they're $1,000 and $2,000 tax credits.

And again, for the last 20 years conservatives have gone on ad nauseum about how tax cuts are not additional spending. You should call Rush and have him update that to "tax cuts are not additional spending unless democrats propose them."

A tax cut would actually cut the taxes - meaning that the amount owed before any credits (i.e., checks that the government has tasked the IRS with distributing) is reduced.

 

[ksen]

No, they're $1,000 and $2,000 tax credits.

And again, for the last 20 years conservatives have gone on ad nauseum about how tax cuts are not additional spending. You should call Rush and have him update that to "tax cuts are not additional spending unless democrats propose them."

A tax cut would actually cut the taxes - meaning that the amount owed before any credits (i.e., checks that the government has tasked the IRS with distributing) is reduced.

Oh, I see. You're using a ridiculously narrow definition of "tax cut".

If you didn't want to seriously discuss this you should have just said so.

 

[Axulus]

These are $1,000 and $2,000 checks to every household that makes under $100k or $200k. Just because the checks are paid by increasing one's tax refund or reducing one's tax liability doesn't make a difference.

Maybe I'm burned out today from work, but is this just accounting bullshit? Not you personally or what you have stated, just the entire argument in general.

One argument is that you are just reducing revenue.
Instead of collecting $8k from me, they get $6k. That didn't cost the Government a dime. To make up for the revenue shortfall, they tax some evil company who makes money by trading shares of stocks by tapping the main line to stock market and taking advantage of the lag in the speed of light to foresee a sale of stock and capitalize on it.

The other argument is that you are increasing spending.
They collected $8k. But increased their budget by $2k and paid me $2k. This spending increase is paid for by taxing evil companies that make a lot of money by adding no value to the nation's worth.

(8 - 2) + 2 = 8 - 2 + 2?

The argument seems to be about whether we include parentheses.

But the key point is that they amount received has no relation to the amount of taxes paid. You are taxing group A to give a check to group B. Taxing group A increases revenue and giving a check to group B is spending.

Would you use the same argument for social security taxes and payments? That the payments really just reduce revenue and that the payments are a tax cut for retirees?

- - - Updated - - -

A tax cut would actually cut the taxes - meaning that the amount owed before any credits (i.e., checks that the government has tasked the IRS with distributing) is reduced.

Oh, I see. You're using a ridiculously narrow definition of "tax cut".

If you didn't want to seriously discuss this you should have just said so.

I am seriously discussing it using correct definitions - you seem to have some emotional need to call it a tax cut, which I can't help you with.

 

[Jarhyn]

A tax cut would actually cut the taxes - meaning that the amount owed before any credits (i.e., checks that the government has tasked the IRS with distributing) is reduced.

Oh, I see. You're using a ridiculously narrow definition of "tax cut".

If you didn't want to seriously discuss this you should have just said so.

You should know by now that all the conservatives have is rhetoric and spin. For most this is a tax cut or tax credit or tax relief. It is only not that for people who will still make money, but slightly less of it. Admittedly I think it is more egalitarian to give the checks in equal portion to everyone.