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How about re-increasing the corporate tax rate? How about taxing self employed people social security/medicare without a cap instead of stopping at ~140k? How

• BeetleB 5y ago
  > How about re-increasing the corporate tax rate? No argument there. > How about taxing self employed people social security/medicare without a cap instead of stopping at ~140k? Why limit this to self employed people? The cap is there for all workers. And self employed people pay double the tax - if you are not self employed, your employer is paying half of it. Self employed people already have a larger burden. > How about massively increasing long-term capital gains, or even just getting rid of it. Income is income- tax it the same. Because then people won't invest in ... much. My guess is the majority of current investments that are profitable would no longer be if taxed as regular income. That then means many businesses will stop existing since people will not invest in them. > If the average person paid 10% instead of 7.5% into SS/medicare but their SS doubled in the long run, are you really saying the average person would be against that? Definitely. Even though it likely is a good solution. The real problem is that the US government, by law, is not allowed to keep the excess SS funds they collect in an "SS bucket". If the SS payouts are less than SS tax collected, the excess is required to be spent elsewhere. We've lost decades of excess SS collections because of this. > There are a billion ways to do this. I am not an expert, but I'm not clueless either. The CBO exists to do such calculations. Increasing SS/Medicare tends to work. Removing incentives to invest, however, is disastrous. > "Oh I get to choose what investments to put my money into even though I have zero control over the actual outcome, great!" There's a disconnect between saying "long term capital gains benefit the rich" and "investments are bad because I have zero control over the outcome." The latter statement is as true for you as it is for rich people. If you think investing is such a bad thing with low returns, then let them have their long term capital gains tax.
  • eatsyourtacos 5y ago
    >Why limit this to self employed people? The cap is there for all workers. And self employed people pay double the tax - if you are not self employed, your employer is paying half of it. Self employed people already have a larger burden. I know, I am self employed. I didn't think there was the same cap for all workers? If there is, then I agree it should be removed (or at least substantially increased). >Because then people won't invest in ... much Yes they will. There are always people who still want to make more money. >If you think investing is such a bad thing with low returns, then let them have their long term capital gains tax. I never said it's low returns- I said it's a bad thing that this is supposed to be the default way to make money. There's a huge difference there in philosophy. And look.. the LT capital gains is not my first go to exactly.. but, I do think it's far too low and again it's something that just disproportionately advantages the rich. Honestly that's my whole point on the investing front. This entire system was created to benefit people who already have lots of capital. My view is hoarding capital to make more capital should not be the goal of life.. but greed knows no bounds.
    • BeetleB 5y ago
      > Yes they will. There are always people who still want to make more money. "There are always people" is a very different statement from "most people who invest will continue to". Any time you lower taxes, you significantly increase investment opportunities because suddenly many unprofitable investments suddenly become profitable. In the investment circles I'm in, most people invest in things that perform lower than the S&P 500 because these are both safer, and more profitable due to the tax benefits. Remove the tax incentives, and easily 90% of the folks I know would pull out. > I never said it's low returns- I said it's a bad thing that this is supposed to be the default way to make money. There's a huge difference there in philosophy. It's not the "default" way. You can choose not to put in any money in 401Ks and go to more traditional approaches - things like real estate and other businesses where you have much more control over the outcomes. You can even use IRA money to do this, as well as some 401K plans. And then you'll find out you're more likely better off with the "traditional" investing. BTW, raising SS tax to 10% to double the returns - it's still not enough. The estimate is that SS will fund only a quarter of the expenses for most retirees. Doubling the returns means it will fund only half of their expenses. > This entire system was created to benefit people who already have lots of capital. This should not come as a surprise. There's a reason it's called "capitalism". For pretty much forever, the system in the US benefited those with capital, and the path to riches is to find a way to acquire some capital to let it grow. Being well off just by virtue of an salary is a fairly recent trend, and always has taken the back seat with respect to capital based investments, and always will in the US. It took a while for me to realize this (in retrospect) obvious aspect of the US economy. I can whine about it and try to change the collective psyche of a whole country, or I can find another place to live, or I can make compromises and put more focus in acquiring capital.