Based on what? Reagan's tax cuts of the 80's? Because Bush's tax cuts haven't done a damn thing but help the rich get richer so far... They certainly haven't stimulated the economy as is attested by the 6% unemployment rate.</font>[/QUOTE]<font face="COMIC Sans MS" size="3" color="#7c9bc4">
Nice rhetoric but devoid of fact. 1st off Reagans and Kennedys tax cuts...and now Bush's tax cuts. While it has not caused a turnaround like the former cuts that is in part becuase of its reletively puny scope compared to previous cuts.
Bush's tax cuts did do more than help the rich get richer...me not being rich and still doing better is one proof, the fact that economists tell us that the economy is growing (slowly but still growing) is another, because prior to the cuts we were in recession. As for 6% unemployment oooo scare me. remember the 1970's with 10% and 12% unemployments? Do you realize that it is estimated that fully 3% of all people in the US are unemployable anyway so we are looking at roughly a real 3% unemployment.</font>

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Remind me to PM you my accoutnant's number..the two of you should talk..one of you is full of ....something. Only an ass would tell his clinets to go away because they get nothing back..sheesh...this cut will give anyone who makes enough money to pay taxes more in their pocket and I think it would be bordering on irresponsible to tell your clients theres nothing you can do with that.....How do you manage to make a living peddeling doom and gloom?</font>


Now, my retirees argue with me: Then they say, but my SEP-IRA/Keogh... Which I reply "are all ready tax free while in the retirement trust" and are "ordinary income" when withdrawn. So, that doesn't help you at all.

Now, when my very rich clients call, they are very happy. That's another 30K+ (or more) income they won't pay taxes on... Not that they'll actually spend it, mind you. It all goes back into the stock market via DRIPs and creates paper wealth.


See, the difference between the rhetoric spewed and the reality of the law. I deal with this rhetoric all the time. But when the returns are prepared and i tell people the impact, I tell them the truth:

Unless you're a multi-millionaire heavily invested in dividend paying stocks, you won't materially benifit from this. Further, it is unlikely it will stimulate the economy (sorry about that luxury service providers) as advertised because most dividends are reinvested. [/QB][/QUOTE]

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Im sorry I just cannot believe you are actually a financial advisor...you don't sound like any I have ever heard. But hey, m not one either so what does it matter?

Edit: just FYI if a couple makes $97,000 a year its considered to be in the top 10% or "rich" according to the Dems and the IRS. $97k a year = 1 NYC teacher + 1 NYC Fireman....hardly rich in reality or in NY.</font>

[ 05-30-2003, 02:44 PM: Message edited by: MagiK ]

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T.L. The sunset provisions I think are a really good idea...if things work out then it would be suicide for the dems to not renew or make them permanent..this will give the repugs a plank to ampaign on..if however things go poorly, then the repugs can say, ok, we tried that and it didn't work, now we have to try something else....kind of a win win thing.</font>

This is fair enough. I have been wrong before, and I promise I will be wrong again at some point in the future. This, however:

Quote:

Obviously you're not a tax accountant and you, like a vast majority of the americans supporting this tax cut, are spouting off about things for which you know nothing.

is simply plain rude. For someone so knowledgeable, you sure lack class buddy.

Besides, you have yet to answer the questions which I put to you. While going to great lengths to explain the rudimentary distinction between Total Income, TI, and AGI, as well as marginal tax, you've given everyone here that didn't know a good lesson on the most basic of income tax concepts, yet you've ignored my repeated questions about some specific provisions that are lauded as beneficial to the middle class. I expect you you either (a) have no response or (b) have been so busy in your flurry of Tax101 postings that you can't be bothered to read the posts cropping up in between your lessons.

[edit] And, oh, I am not supporting the tax cut. I querried you on 3 or 4 things that have been cited by others as "good points" and I want to know if there are flaws to them. In fact I do not support the tax cut. But, despite the rubber-sharp wit with which you can insult, you apparently have not been observant enough to notice that.

[ 05-30-2003, 02:51 PM: Message edited by: Timber Loftis ]

TL, the beauty of any tax rollback, is that it keeps people aware of the tax system in the first place. Increasing taxes is a dirty word in politics at this point, with the general public. However, spending is not yet to the same level. I fully understand the point conveyed here, but question the ability of any politician to sell us all on a bill of goods where we need huge tax increases.
I also understand the rob Peter to pay Paul mentality. Hell, people our age are pretty much "effed" when the question of funding Social Security for the Baby Boomers is seriously looked at. I hold no illusions about what our say is going to be, when they will outnumber us in the polling booths to such an extent. If there is anything left by the time the Baby Boom generation is finished, I will personally be astonished.

I agree the "cut-off" levels are rather interesting to say the least. How they reached the individual scales is anyones guess. This is precisely the type of bug-a-boo that occurs though, when people, in their divine wisdom, added income taxes to the fricking bill of rights. Yet another reason to not tinker with the initial premises IMO (from the other thread).


TIME OUT! Berate? Hardly! I am not berating anyone for what they do or what they earn. IMO, that is entirely up to the individual and the choices/repurcussions *of* their choices. Whether they are fantastically successful or dismal failures.

Good on you then , that you have no superiority complex. Join the club!

In your post you assume many things. Unfortuneately, it's not particulary true in the real world. Investing in companies by buying stock is an arguement I've always gotten a laugh out of...

First, most of these companies purchase stock to disguise or re-classify the taxable income characteristics of compensation for highly compensated employees. Or they buy stock to drive up the prices for shareholders. They seldom issue new stock or treasury stock at a "profit."

Second, stock transactions are negative-sum games between investors. Cash goes OUT of one pocket INTO another pocket. However, since the government takes a cut of any gains, there is a net "destruction" of "private worth" as some of the proceeds are redistributed to the government.

It's only in the IPO does this hold true. And then, it's often limited because most IPOs have a vic behind them, who may very well be japanese or european or arab and will take the profits over-seas.

As far as the cuts benefiting the economy, the first set of cuts were pretty marginal. The Congressional Budget Office was clear they wouldn't have any real effect. (Except reducing taxes on the rich.) And by gosh, they haven't.

Now, the arguement for the "tax-cuts = growth" comes from the Kennedy-era (A rising tide lifts all boats), via Regan era. Under Kennedy, the top rate dropped from 96 (or so) percent to something like 69 or 76 percent... Under Reagan the tax-rate bracket cuts were huge! We went from brackets in the 70+% range to a max of 39.6. However, something not talked about by the "political tax cutters" was that TRA '86 was a net-zero-effect tax-law change.

That is, while the brackets went down in some areas, they went up in others (like long-term capital gains). Plus, Reagan closed a TON of loopholes (one of which caused the real-estate debacle in the late 1980's), limited or removed many tax credits, removed deductions, repealed the General Utilities doctrine, added passive loss rules (Sec. 469), closed tax shelter provisions (Oil & Gas especially causing that exploration sub-industry to collapse as investment dried to a trickle) etc.

All-in-all, there was no net change in total taxation and as capital gains rates were increased for LTCG (long-term capital gains) it is unlikely that "increased" investment due to "lower rates" was the empitus of the econmies growth.

So, what really caused the outcome that tax revenues increased by 8% per year? The tax cuts? Not likely. They were net-zero-effect. The huge deficits and spending billions of dollars with defense contractors and social welfare programs? You remember those deficits (paid off during the Clinton years) run up by the Federal goverment which went on a spending ramapage as the hawks and doves lay down together?

Or was it productivity gains because of the technology upheaval? That's what Allen Greenspan thinks.

For example, when Regan came in, personal computers were non-existent. Computerized machinery was unheard of except by geeks in the basement of MIT. By the time Regan left office, I had a 33MHz 386 with 4 whole MB of RAM and a 65MB HD! (WooHoo!) My productivity as an accountant shot through the roof. My friends who are architects or engineers have had the same gains.

So, what I'm saying is that while tax cuts may be popular with the rich, there isn't any solid historical evidence to prove that a tax cut to the rich can stimulate an economic recovery. There is a lot of evidence that major changes in techonology, leading to productivty gains can stimulate economic recovery and growth. We've had it with railroads, steam ships, electricity, computers, plastics, internal combustion vehicles and a host of other products and technologies.

A pensioner? Pensions are ordinary income. Therefore, it will not help them at all. If they are a pensioner who also supports themselves with non-retirement-trust dividends and gains, then yes. But only to the extent that it will make a real reduction in their taxes or provide them an opportunity to aviod convernting equities into cash.


1. The marriage penalty is a bit of a misnomer and only applies when you have two working spouses. Second, the greatest effect is on high-net-income DINKs where both spouses have high incomes. A man who makes 100K and has a wife who works part-time at Restoration Hardware (6K) to get the employee discounts is hardly suffering from the "marriage penalty."

Also, the true marriage penalty is the difference between the taxes if each person filed as "single." Only if there isn't a large gap between the relative incomes is there any real penalty.

OTOH, if you've got a stay-at-home spouse, you have a "marriage benefit." A lower tax bracket on the same income and a higher standard deduction.

So, there is not a real "penalty" per se. Some benefit, some don't.


2. A reduction in payroll taxes is stupid. There is a projected 44 TRILLION deficit in future obligations to retirees. To cover this, a 66% increase in the payroll taxes is needed to build up the surplus required for Social Security to function.

3. It's been discussed. The fastest way to stimuate an economic recovery through a tax break is to funnell the money to the less-advantaged. This money will be spent on consumer goods.

If you give it to the rich, they have a tendency to save the money, reducing the effect. At least if anything they taught in economics over the last 30 years is true.


And you call-out others rude? :rollseyes: The word is hypocrite.

I don't see anything rude in this statement made by TL. He was making a joke about the fact that he was derailing the thread somewhat to ask for free info from you.

Thanks guys for all this info (Magik, TL, Drac), I'm learning a whole lot (seriously) :D

Repeated posts baiting and antagonizing because you didn't like having to wait for gratification. That, coupled with your history of smugly-superior and smarmy put-downs of myself and others, who know as much or far, far more than you; added to your typcial american distain for any intellectual process or debate that doesn't end up in a "poopy contest" pretty much tells me everything I care to know about you. In short, with your rudeness and intolerence as well as your childish demands for instant gratification, I think you succeeded quite well in demonstrating what needed to be demonstrated.

Ciao, baby.

Well, I guess I'm speechless. For a change. I didn't mean to bait you, I didn't mean to smarm, and I certainly may be dumber than you. Guess I'll just go put my nose in the circle on the blackboard for a while.

You don't. I do. Timberloftis decided I was rude. Whereas, I considered myself to be brusqe and matter-of-fact.

Therefore, rudeness is subjective not objective. From my perspective, Timberloftis made an erroneous subjective judgement on a non-specifically addressed comment and made a direct personal attack, making him doubly wrong.

See my point? Or are you going to argue it? Because it *is* subjective.

I'm sorry I beg to differ and measurably so. If as you assert the only purpose for stock is to "line the pockets of highly compensated employees", then no one would every buy stock! Or they buy stock to drive up the prices for shareholders you added. Again I somewhat agree/disagree. While the number one priority of a company is the shareholder, they cannot simply buy stocks that merely shuffle money back and forth and hope to make a profit. Somewhere in the occassion and tangible good or service has to be exchanged to a consumer, no matter how shifty, thrifty or nifty the accounting department or firm is who is handling the books manages to "eff" with the numbers.


The major problem I have with the opening notion, is that it almost asserts that wealth is a finite number of apples on our apple tree. Perhaps I am reading this wrong? Of course cash moves between "pockets" that is called a free market/consumer economy, where people buy things or services, they want and need.

This is a pretty wide assertion here. In a nutshell, if I am reading this correctly you are basically asserting that neither plan actually worked, but instead it was some near magical force of good luck that turned the tide of a "in the dumper" economy, of run-away inflation, known more commonly as the 1970's. Technological breakthrough, as mentioned in particular had been occurring in the 1970's in the same likeness as the 1980's. While the PC was obviously revolutionary, so were other technological improvements during the Carter Administration. So, why didnt this fact turn the economy around and make Carter look like the genius? Productivity is a great thing for the business owner and government alike I agree, because both receive more capital as a result, if in fact "real work" and thus "real money" is being made by such.
(Being in the technology business I fully understand how the word productivity is loosely thrown around as a selling point, amongst sales reps. [img]graemlins/blueblink.gif[/img] )
But here is another fact about technological breakthroughs. They cause people to become unemployed as well. You mentioned C.A.D/.C.A.M. for instance, which "revolutionized" manufacturing procedures. Sure jobs were created as a result but jobs were also lost. A firm requiring, 100 trained machinists for instance, now needed maybe ten, who could get the same amount of productivity with the new technology. The Catch 22 of this, for the manufacturer is that the consumer/customer then demanded cheaper and cheaper prices, only possible with higher expenditures in even more sophisticated machinery. We now have machinists in name only, whereas the proper terminology is operator. Whom by the way do not command the same kind of money what-so-ever. With larger and larger mass production capability, the truth is, we need less manufacturers than we needed previously. The trend being that we need to send our kids to college to get a degree for one of those "high paying office jobs". Kind of a misnomer dontcha think? Especially with this new trend proving to have no merit, after investing tens of thousands of dollars into a degree. IMO, the time will soon come, where it makes no sense to do so, when the lifelong compensation of the employee will not bear out the investment needed to be compensated at that level.
I suppose my question to you is, since you are very knowledgeable in this field, whats next? Mind you I am not one of those "the glass is half empty" people and hopelessly so, but the trend is here. What is the solution?

<font color = lightgreen> [img]graemlins/erm.gif[/img] ooookayyyy.....

I was going to respond to the back-and-forth discussion, since I do have some familiarity with taxation, economics, and investments; however, I think I'll just have another glass of blush wine and move on to some other thread. :rolleyes:

btw...the only way for Social Security to become reasonably funded for the future is to have the proceeds invested in the economy, preferrably in well-diversified portfolios. Or to overhaul the system completely; it doesn't take a genius to figure out which one is more easily accomplished.</font>

Repeated posts baiting and antagonizing because you didn't like having to wait for gratification. That, coupled with your history of smugly-superior and smarmy put-downs of myself and others, who know as much or far, far more than you; added to your typcial american distain for any intellectual process or debate that doesn't end up in a "poopy contest" pretty much tells me everything I care to know about you. In short, with your rudeness and intolerence as well as your childish demands for instant gratification, I think you succeeded quite well in demonstrating what needed to be demonstrated.

Ciao, baby.[/qb]</font>[/QUOTE]You don't. I do. Timberloftis decided I was rude. Whereas, I considered myself to be brusqe and matter-of-fact.

Therefore, rudeness is subjective not objective. From my perspective, Timberloftis made an erroneous subjective judgement on a non-specifically addressed comment and made a direct personal attack, making him doubly wrong.

See my point? Or are you going to argue it? Because it *is* subjective. </font>[/QUOTE]Now now children, put the handbags down, eh? Chill out and try to deal with this the way you would deal with it in the real world (assuming you're not in primary school, which I assume neither of you are) with the person in front of you. Surely you wouldn't be foaming at the mouth at them and calling them names just because they disagreed with you...or would you? I hope not.

Don't care who started it...it doesn't make either of you look particularly good. I'd like a bit of maturity please. ;)

[ 05-31-2003, 01:23 PM: Message edited by: Memnoch ]

Come on Memnoch - an accountant swapping insults with a lawyer. I'd pay good money for this! :D

Come on Memnoch - an accountant swapping insults with a lawyer. I'd pay good money for this! :D </font>[/QUOTE]I once knew an accountant whose wife had a professional caterer prepare meals for their dinner parties and then she would pass them off as her own.
However, I once knew of a lawyer who used to start drinking at 1.30 every afternoon!!!
Shame on them all I say.

I'm echoing Memnoch's sentiments, fellas. Knock it off or end up sitting in another sandbox. ;)