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For nearly the last decade, I've paid income taxes at the lowest rates of my professional career. Before that, I paid at higher rates. And if you want the simpl

For nearly the last decade, I've paid income taxes at the lowest rates of my professional career. Before that, I paid at higher rates. And if you want the simple, honest truth, from my perspective as an entrepreneur, the fluctuation didn't affect what I did with my money. None of my investments has ever been motivated by the rate at which I would have to pay personal income tax. This is wrong and he's missing the point. It's not important what he feels he's motivated to do, or not do. The important part is that every additional dollar he pays in taxes is one dollar fewer he get's to invest in whatever it is he's motivated to invest in. It's the opportunity cost that we need to evaluate. And a large percentage of every dollar he pays in taxes will be lost in the inefficiencies of large government bureaucracy. He would be able to make much more efficient decisions on how to spend that money himself, and that's what's lost when when he pays a higher tax rate.

0abdd0e66h 16y ago
"he's missing the point" This is what gets me about a lot of people who argue against anything related to increases in taxes despite the practicality of it. They refuse to look at it in an objective light and take up ideological arguments. Really? A 4% increase on 2% of the population is going to destroy the country? You don't even care about it. It's against your "principles" despite the fact that we're hurting and that makes it wrong.
- lzw 16y ago
  I think you misunderstand those who argue against increases in taxes. The argument is not "principles" but practicality of it. It is never %4 on %2. For instance the "bush tax cuts" would have cut the taxes of the poorest brackets in half, but the democrats wouldn't allow that. That there was %7 on %90 or so. High taxes are why we're hurting in the first place. It is government that has so damaged our economy. Take the housing bubble, for instance. Ideologues want to pretend that "banks" caused it, but the reality is it was clinton and bush. During the clinton era, they decided that "lending money only to people who can pay it back is racist" and changed bank regulations to make the "american dream" available to "all". Then under bush, the interest rate-- controlled by the government via the federal reserve-- was lowered below inflation, which means you could borrow money and earn a zero-risk return on it higher than the cost of borrowing. The primary mechanism for this was the housing market. Thus, housing bubble. Leftists like Krugman praised it claiming that the housing bubble was just what the economy needed. Meanwhile, practical people who understand economics warned against it. Now, after half a decade of listening to political types claim there was no housing bubble, or that the bankers caused it, you're now claiming we need to raise taxes because its "practical". I'd like to see you explain how it is practical. One things for sure, it won't help the economy.
  - 0abdd0e66h 16y ago
    I'm talking about taxes on the top earners, not 'middle class' taxes. It's "practical" in the sense that it would help reduce the deficit which a certain group of people seem to be so outraged at. Of course, we can cut benefits, which I'm assuming is your preferred mechanism for balancing the budget. The problem is that cutting benefits seems to negatively affect a higher percentage of the population who are not top earners vs. scraping some bucks from the top of the incomprehensibly rich. Whether or not private enterprise is actually more "efficient" at spending money is something I would also like to see proven.
    - isaacagarcia 16y ago
      "Raising taxes on the top 2% of households, as Mr. Obama proposes, would bring in $34 billion next year: enough to cover nine days’ worth of the deficit," http://www.economist.com/node/17043472?story_id=17043472 http://www.economist.com/node/17043472?story_id=17043472 This conversation is a waste of time and is pure political rhetoric for election season. $34 billion is insignificant and simply a means to incite class warfare.
      - blasdel 16y ago
        Letting these cuts expire is the lowest-hanging fruit for boosting revenue — there are a lot of others above it, like expanding the estate tax before the boomers all die. They're just doing the simplest thing first.
  - prodigal_erik 16y ago
    The CRA required the same lending standards for good credit risks in minority neighborhoods, not lower standards. And it didn't even apply to the shady mortgage banks who fueled the housing bubble. They were eager to write loans to anyone who could fog a mirror, because they knew they could get a bent rating and dump even the stupidest loan on Wall St.
    - bd_at_rivenhill 16y ago
- dschobel 16y ago
  You are mischaracterizing his argument. It is 100% economic. The "practicality of it" is to make the economy more sound, not some slavish devotion to laissez faire ideals for subjective reasons.
- Yzupnick 16y ago
  I'm not so sure you're being objective about it. He responds with a logical response that explains why he makes the claim that the OP is missing the point. Your response to him is; "Really? A 4% increase on 2% of the population is going to destroy the country?" Which doesn't say anything at all, especially in response to what the poster said. Furthermore, in my experience it is exactly the opposite. Most of the people who advocate raising taxes do so for ideological reasons. While those in favor of lowering it are for practical. I'm not saying everyone, there are people who believe raising taxes will stimulate the economy, and there are people who are ideologically opposed to taxes; Ayn Rand for example (although she is opposed for practical reasons also.) That's just been my experience.
lzw 16y ago
The error that no big-government types ever seem willing to address is that the money they take out of the economy, they take out right at the point where it would do the most good for people. Where it would be going to expand businesses and create jobs and eliminate poverty, or allow families to buy a new car, or pay for college, it goes into government which spends it, inefficiently, on programs that are claimed to solve the problems that are caused by taking the money out in the first place. (And programs which are inevitably operated to perpetuate themselves more than to help people.) India reduced regulations on businesses dramatically in 1980 and has managed to double the standard of living for over a billion people. The poor in india are a lot less poor now, and there's lots of comparatively rich people in india now who have surplus income to give to their extended families, which is a second bonus for the poor. If governments would just let people be, poverty would be eliminated. In fact, poverty is the pinnacle achievement of government. Why? Because if you have masses of poor people, you can manipulate them easier, because they are dependent on you. This is how the soviet union survived for 70 years, and it is what big government types are trying to do to the US now.
- blahedo 16y ago
  > If governments would just let people be, poverty would be eliminated. In fact, poverty is the pinnacle achievement of government. This is either breathtakingly naïve or terrifically disingenuous. Human history shows us many times and places that had little or no government intervention, and such milieux weren't exactly the utopias that lzw seems to claim. When governments "just let people be", we get robber barons, rapacious working conditions, and a beaten-down underclass. The golden age of the middle class in the US occurred in the decades following labor reform, regulation, and the social safety net; and I don't even need to claim that this correlation is causative to cite it as a counterexample to lzw's patently absurd suggestion here.
  - lzw 16y ago
    OF course, as the product of a government school, you believe what you were taught, and you think as you were taught to think, and therefore, simply pointing out obvious history is, to your unthinking mind "absurd". You trot out nonsense like "robber barrons" ignoring the fact that robber barrons were actually a good thing, and were nigher robbers, nor barrons, and did more to increase the standard of living of the poorest in this country than any of the socialist nonsense your addled brain endorses. You are a good cow, and you just mooed, and you are offended that someone might not want to be a cow. Well, the time of your slaughter is getting close, I hope you're nice and fat for the farmer. Me? I've left the farm. Life's to short to try to educate cows.
kevin_morrill 16y ago
Absolutely right. I think people miss the point that no matter what wealthy people do--whether spending, saving or investing--that money is active in the economy. The other thing missing from this guy's write up is that the human mind is at the center of all value creation. It's as if he thinks money is what creates opportunity and if you just distribute it right--good things will happen. Not true. The cause of our economic plight is a lack of great minds being applied constructively. One of the reasons that's not happening right now, beyond just poor education, is several decades of messed up interest rates sending the wrong economic signals.
bd_at_rivenhill 16y ago
He's also missing the point that he's in the vocal minority of people who are not motivated by the tax rate and that there are many other people who expend time and money hiring accountants and lawyers to structure their investments in ways that avoids these taxes. Why pay 28 to 35 percent when you can pay 15 percent, which probably ends up looking more like 18 percent after all the fees? These people do not go around writing articles about it because they don't want any attention from the media or the IRS but they certainly do exist.
- hga 16y ago
  And even more people don't "expend time and money hiring accountants and lawyers to structure their investments", they just do simple obvious things, like put money into tax free municipal bonds instead of things that might grow the economy (for a worst case, a money losing stadium complex vs. a startup). I watched my parent's economic behavior change quite a bit after the Carter and Reagan tax cuts, specifically on capital gains (yes, Carter started this and the general deregulation of the economy, e.g. air travel and trucks), on "unearned" income (70% before the Reagan tax cuts), etc. Their behavior and many others became economically much more productive, resulting in the long boom from 1983-4 to the "new normal" we fear will come from the Great Recession and the responses to it.

0abdd0e66h 16y ago

"he's missing the point" This is what gets me about a lot of people who argue against anything related to increases in taxes despite the practicality of it. They refuse to look at it in an objective light and take up ideological arguments. Really? A 4% increase on 2% of the population is going to destroy the country? You don't even care about it. It's against your "principles" despite the fact that we're hurting and that makes it wrong.

lzw 16y ago
I think you misunderstand those who argue against increases in taxes. The argument is not "principles" but practicality of it. It is never %4 on %2. For instance the "bush tax cuts" would have cut the taxes of the poorest brackets in half, but the democrats wouldn't allow that. That there was %7 on %90 or so. High taxes are why we're hurting in the first place. It is government that has so damaged our economy. Take the housing bubble, for instance. Ideologues want to pretend that "banks" caused it, but the reality is it was clinton and bush. During the clinton era, they decided that "lending money only to people who can pay it back is racist" and changed bank regulations to make the "american dream" available to "all". Then under bush, the interest rate-- controlled by the government via the federal reserve-- was lowered below inflation, which means you could borrow money and earn a zero-risk return on it higher than the cost of borrowing. The primary mechanism for this was the housing market. Thus, housing bubble. Leftists like Krugman praised it claiming that the housing bubble was just what the economy needed. Meanwhile, practical people who understand economics warned against it. Now, after half a decade of listening to political types claim there was no housing bubble, or that the bankers caused it, you're now claiming we need to raise taxes because its "practical". I'd like to see you explain how it is practical. One things for sure, it won't help the economy.
- 0abdd0e66h 16y ago
  I'm talking about taxes on the top earners, not 'middle class' taxes. It's "practical" in the sense that it would help reduce the deficit which a certain group of people seem to be so outraged at. Of course, we can cut benefits, which I'm assuming is your preferred mechanism for balancing the budget. The problem is that cutting benefits seems to negatively affect a higher percentage of the population who are not top earners vs. scraping some bucks from the top of the incomprehensibly rich. Whether or not private enterprise is actually more "efficient" at spending money is something I would also like to see proven.
  - isaacagarcia 16y ago
    "Raising taxes on the top 2% of households, as Mr. Obama proposes, would bring in $34 billion next year: enough to cover nine days’ worth of the deficit," http://www.economist.com/node/17043472?story_id=17043472 http://www.economist.com/node/17043472?story_id=17043472 This conversation is a waste of time and is pure political rhetoric for election season. $34 billion is insignificant and simply a means to incite class warfare.
    - blasdel 16y ago
      Letting these cuts expire is the lowest-hanging fruit for boosting revenue — there are a lot of others above it, like expanding the estate tax before the boomers all die. They're just doing the simplest thing first.
- prodigal_erik 16y ago
  The CRA required the same lending standards for good credit risks in minority neighborhoods, not lower standards. And it didn't even apply to the shady mortgage banks who fueled the housing bubble. They were eager to write loans to anyone who could fog a mirror, because they knew they could get a bent rating and dump even the stupidest loan on Wall St.
  - bd_at_rivenhill 16y ago
dschobel 16y ago
You are mischaracterizing his argument. It is 100% economic. The "practicality of it" is to make the economy more sound, not some slavish devotion to laissez faire ideals for subjective reasons.
Yzupnick 16y ago
I'm not so sure you're being objective about it. He responds with a logical response that explains why he makes the claim that the OP is missing the point. Your response to him is; "Really? A 4% increase on 2% of the population is going to destroy the country?" Which doesn't say anything at all, especially in response to what the poster said. Furthermore, in my experience it is exactly the opposite. Most of the people who advocate raising taxes do so for ideological reasons. While those in favor of lowering it are for practical. I'm not saying everyone, there are people who believe raising taxes will stimulate the economy, and there are people who are ideologically opposed to taxes; Ayn Rand for example (although she is opposed for practical reasons also.) That's just been my experience.

lzw 16y ago

The error that no big-government types ever seem willing to address is that the money they take out of the economy, they take out right at the point where it would do the most good for people. Where it would be going to expand businesses and create jobs and eliminate poverty, or allow families to buy a new car, or pay for college, it goes into government which spends it, inefficiently, on programs that are claimed to solve the problems that are caused by taking the money out in the first place. (And programs which are inevitably operated to perpetuate themselves more than to help people.) India reduced regulations on businesses dramatically in 1980 and has managed to double the standard of living for over a billion people. The poor in india are a lot less poor now, and there's lots of comparatively rich people in india now who have surplus income to give to their extended families, which is a second bonus for the poor. If governments would just let people be, poverty would be eliminated. In fact, poverty is the pinnacle achievement of government. Why? Because if you have masses of poor people, you can manipulate them easier, because they are dependent on you. This is how the soviet union survived for 70 years, and it is what big government types are trying to do to the US now.

blahedo 16y ago
> If governments would just let people be, poverty would be eliminated. In fact, poverty is the pinnacle achievement of government. This is either breathtakingly naïve or terrifically disingenuous. Human history shows us many times and places that had little or no government intervention, and such milieux weren't exactly the utopias that lzw seems to claim. When governments "just let people be", we get robber barons, rapacious working conditions, and a beaten-down underclass. The golden age of the middle class in the US occurred in the decades following labor reform, regulation, and the social safety net; and I don't even need to claim that this correlation is causative to cite it as a counterexample to lzw's patently absurd suggestion here.
- lzw 16y ago
  OF course, as the product of a government school, you believe what you were taught, and you think as you were taught to think, and therefore, simply pointing out obvious history is, to your unthinking mind "absurd". You trot out nonsense like "robber barrons" ignoring the fact that robber barrons were actually a good thing, and were nigher robbers, nor barrons, and did more to increase the standard of living of the poorest in this country than any of the socialist nonsense your addled brain endorses. You are a good cow, and you just mooed, and you are offended that someone might not want to be a cow. Well, the time of your slaughter is getting close, I hope you're nice and fat for the farmer. Me? I've left the farm. Life's to short to try to educate cows.

kevin_morrill 16y ago

Absolutely right. I think people miss the point that no matter what wealthy people do--whether spending, saving or investing--that money is active in the economy. The other thing missing from this guy's write up is that the human mind is at the center of all value creation. It's as if he thinks money is what creates opportunity and if you just distribute it right--good things will happen. Not true. The cause of our economic plight is a lack of great minds being applied constructively. One of the reasons that's not happening right now, beyond just poor education, is several decades of messed up interest rates sending the wrong economic signals.

bd_at_rivenhill 16y ago

He's also missing the point that he's in the vocal minority of people who are not motivated by the tax rate and that there are many other people who expend time and money hiring accountants and lawyers to structure their investments in ways that avoids these taxes. Why pay 28 to 35 percent when you can pay 15 percent, which probably ends up looking more like 18 percent after all the fees? These people do not go around writing articles about it because they don't want any attention from the media or the IRS but they certainly do exist.

hga 16y ago
And even more people don't "expend time and money hiring accountants and lawyers to structure their investments", they just do simple obvious things, like put money into tax free municipal bonds instead of things that might grow the economy (for a worst case, a money losing stadium complex vs. a startup). I watched my parent's economic behavior change quite a bit after the Carter and Reagan tax cuts, specifically on capital gains (yes, Carter started this and the general deregulation of the economy, e.g. air travel and trucks), on "unearned" income (70% before the Reagan tax cuts), etc. Their behavior and many others became economically much more productive, resulting in the long boom from 1983-4 to the "new normal" we fear will come from the Great Recession and the responses to it.