I am at loss how either party can support such a deficit heavy bill.

[Edited on December 7, 2010 at 10:11 AM. Reason : s]

12/7/2010 10:07:22 AM

There are plenty of businesses that operate on a loss for years and years. Most obvious example is a restaurant.

12/7/2010 10:11:58 AM

Well, DaBird, as the link below claims to show, revenue does not change much. If we raise tax rates, reported incomes fall as Americans spend more of their time on tax avoidance. As revenue as percentage of GDP is already near the highest it has ever been, such that I don't think the tax increases would have actually produced the $300 billion/year expected, or only 1/4th the deficit, nearly all of the gap is going to need to be closed with spending reduction.
http://reason.com/assets/mc/ngillespie/2010_11/taxratevsgdpjpeg.jpg

12/7/2010 10:31:54 AM

Quote :

"There are plenty of businesses that operate on a loss for years and years. Most obvious example is a restaurant."

Need not these businesses eventually turn a profit or become defunct?

12/7/2010 10:53:16 AM

Quote :

"Not unless you're mdozer73, who thinks a 4.7% return on your investment is poor."

4.7% is hardly a Scrooge-like profit margin. its laughable you would make that comment. I could not stay in business for that amount.

you also have to weigh risk vs reward. to start/maintain a business a person has a lot more at risk than just cash (which is usually substantial by itself). the reward has to be worth said risks.

[Edited on December 7, 2010 at 10:56 AM. Reason : .]

12/7/2010 10:55:36 AM

Quote :

"Well, DaBird, as the link below claims to show, revenue does not change much. If we raise tax rates, reported incomes fall as Americans spend more of their time on tax avoidance. As revenue as percentage of GDP is already near the highest it has ever been, such that I don't think the tax increases would have actually produced the $300 billion/year expected, or only 1/4th the deficit, nearly all of the gap is going to need to be closed with spending reduction. http://reason.com/assets/mc/ngillespie/2010_11/taxratevsgdpjpeg.jpg"

i am a huge proponent in smaller government and spending reduction. I am also a realist, and the realist in me says that the only way it is going to be solved is if everyone takes a huge bite of the shit sandwich. republicans are going to have to raise taxes and the democrats are going to have to cut spending where it hurts. the rocks to hurl back and forth will have to be equal for anything to pass.

12/7/2010 10:58:52 AM

^^ LOL! Dude. Get real. No business is going to suddenly get 500% return each year.

If your revenue is 21 million, but it takes 20 million to get that 21, you're still making out. A ton of businesses will kill just to break even. We're not talking about some start up company.

Some of you guys have some ideal view of how the business world works, where all the companies and plants in the US are pulling in 20% returns just to stay in business.

12/7/2010 12:13:48 PM

merbig:

Quote :

"Not unless you're mdozer73, who thinks a 4.7% return on your investment is poor."

EuroTitToss:

Quote :

"^Actually, he thinks someone with access to $100 million in capital is poor."

merbig:

Quote :

"LOL! Dude. Get real. No business is going to suddenly get 500% return each year. If your revenue is 21 million, but it takes 20 million to get that 21, you're still making out. A ton of businesses will kill just to break even. We're not talking about some start up company. Some of you guys have some ideal view of how the business world works, where all the companies and plants in the US are pulling in 20% returns just to stay in business. "

The question was not whether they were rich or not. The question was whether or not they would continue to feed the beast that was barely giving them any return on their risk. If I had $100 Million in assets, I would not be operating a factory for a low return (>5%). I think it is laughable for you to say the same.

Sure, every business is different, but my lifetime goal is to create a legacy for my kids and grandkids. I guess I am greedy in the aspect that I want to be well off.

The business where I work is also one of the ones in the sights of the Bush era tax cuts. If it makes more sense to make less money, we plan to downsize the business so we are not punished by paying a disproportionate amount of taxes. It is all about percentages. If the company can be better off by being smaller, this is counter-intuitive to growing the economy.

[Edited on December 7, 2010 at 12:45 PM. Reason : tags]

12/7/2010 12:45:22 PM

$100 million in assets doesn't translate to $100 million in cash.

12/7/2010 5:15:24 PM

Quote :

"I am at loss how either party can support such a deficit heavy bill."

Because neither side is accounting for the full cost. The democrats only mention the additional $700b dollar bux that the "wealthy tax cuts" cost while failing to mention that all of the others cost $3t dollar bux.

12/7/2010 5:55:24 PM

The real answer is that no one cares about deficits. At all. Not even in the slightest.

Deficits are solely used as rhetoric during election season.

No voter is going to be altruistic and say, "hey guys, I think we need higher taxes and less benefits so we can pay down this national deficit thing." Hence, no politician is going to support that position.

[Edited on December 7, 2010 at 6:29 PM. Reason : .]

12/7/2010 6:27:56 PM

or the 56B in unemployment ext.. to 3 years? lol

or the 120B in SS tax breaks

or the 40B in tax breaks to lower wage earners.

Actually the 2 yr costs to extend the tax cuts are 75B for "super high evil rich" and 383 Billion for the rest of us peasants living hand to mouth.

12/7/2010 6:30:21 PM

How much does that work out to on a per person basis?

12/7/2010 8:06:45 PM

Quote :

"The democrats only mention the additional $700b dollar bux that the "wealthy tax cuts" cost while failing to mention that all of the others cost $3t dollar bux."

Just like the republicans only mention extending the unemployment benefits, yet want to extend tax cuts to the rich that costs several times more.

12/7/2010 8:20:58 PM

I love how the completely necessary fiscal overhaul of the US government has turned into yet another partisan pissing match.

If elected officials actually gave a shit at all about the long term good of the country rather than just protecting their seat they'd seriously address the massive deficit by raising taxes in the short term and eliminating programs in both the short and long term. You can run a deficit, hell we have been for all but a handful of this nation's 230+ years, but you can't run a deficit of this size and continue to add to it without negative consequences.

Sometimes as a legislator you have to vote for what your constituency wants and sometimes you have to vote for what they need. The two are frequently in opposition.

12/7/2010 8:25:34 PM

I have recently come across an interesting interpretation of events. The US dollar has become the de-facto gold standard of the world and this has harmed U.S. monetary independence, as quantitative easing II just winds up being sterilized by foreign governments defending their de-facto pegs to the dollar. This is a similar to the world pre-1960s. Well, like the 1960s, the U.S. government responded to the loss of monetary independence by inflating wildly, only to have it sterilized by bretton-woods, until the whole system collapsed under Richard Nixon as everyone abandoned their pegs, the dollar devalued heavily, and U.S. inflation reached double digits.

Quote :

"republicans are going to have to raise taxes and the democrats are going to have to cut spending where it hurts."

Tax cuts are not the only thing that republicans enjoy. Why not means test medicare to annoy the democrats, and then slash military spending to annoy the republicans.

[Edited on December 8, 2010 at 2:23 AM. Reason : /./]

12/8/2010 2:18:57 AM

means testing medicare would annoy republicans as much as democrats.

Republican politicians not only love social security and medicare, they are in love with them.

12/8/2010 2:45:43 AM

^if you start means testing medicare and SS they become just another welfare program.

You need to encourage people to move into the productive class instead of staying in the recipient class. I think adding another welfare program will do the opposite.

I think for medicare you need to have medicare start covering less and the actual consumer paying more. SS should have an opt out, raise retirement age, and not allow its funds be used in the general fund.

12/8/2010 8:52:08 AM

An opt out for SS is a great, but impossible idea at this point. Personally I thinkthey should eliminate retirement layouts for anyone currently under 35. You continue to pay but you don't get it when you retire. Anyone over 35 gets a percent of their benefit. It should slowly disappear. 30 years is more than enough time to plan for retirement.

12/8/2010 3:37:36 PM

You vastly underestimate the effects of compound interest.

12/8/2010 4:04:23 PM

That, or something like that, is probably the only thing that could work. I can't think of a better way to alienate the younger working class, either. Fuck the previous generations of politicians that forced this upon us, and fuck the people that voted for them. Fuck paying into a system that I will never benefit from. I did not choose this, and if I can find a way out of paying FICA without being sent to prison, I will.

[Edited on December 8, 2010 at 4:06 PM. Reason : ]

12/8/2010 4:06:12 PM

I think the majority of us already feel that way. Sorry if that was sarcasm, my radar is broken.

12/8/2010 4:28:18 PM

Quote :

"You vastly underestimate the effects of compound interest."

Huh?

12/8/2010 4:43:49 PM

^^Well, the government is still maintaining that everyone that pays in will get their check. Obviously, that doesn't reconcile well with economic reality, but if the government is publicly admitting that young people are required to pay in, but will not get anything back, a lot of people that were previously oblivious ard going to be pissed.

12/8/2010 4:48:20 PM

It's a bad sign that they've even admitted that you won't get your full benefit. If people bothered to read the SS letter they get every year there might be more outrage.

12/8/2010 4:54:57 PM

Eh? I didn't read the whole thing because retirement is so far away I don't care, but I specifically remember reading text about the program being solvent, blah blah blah. What language is in there about not getting the full amount?

12/8/2010 4:57:48 PM

I don't have it handy, but I believe there's something to the effect of at current rates by 2050 or so they'll only be able to pay 70% of expected benefits. I'll see if I still have the letter, I may have shredded it though.

12/8/2010 6:06:18 PM

I think you could continue to pay for current retirees with the employer contribution and a percentage of current workers, but have a percentage of current workers move into private accounts. These accounts cannot be touched by the govt and only a percentage withdrawn from. The account can then be passed on to whoever the individual wishes. Thus, as someone mentioned, the real power of compound interest will result in wealth for many in a couple generations.

You could then have the govt guarantee a min benefit that you could choose from.

12/8/2010 6:31:40 PM

Or we could just get the government out of the investment/retirement business altogether.

12/8/2010 7:22:25 PM

Here it is

http://www.ssa.gov/mystatement/currentstatement.pdf

I think they changed it since I got mine a few months ago because I distinctly remember language to the effect that the plan was solvent and I remember laughing inside about it.

Quote :

"In 2015 we will begin paying more in benefits than we collect in taxes. Without changes, in 2037 the Social Security Trust Fund will be able to pay only about 78 cents for each dollar of scheduled benefits.* We need to resolve these issues soon to make sure Social Security continues to provide a foundation of protection for future generations."

12/8/2010 7:25:48 PM

It's said that for the last 2 years at least. I knew it was something like that because I was taken aback that they were finally admitting that it was just a giant ponzi scheme.

12/8/2010 7:27:54 PM

I do remember getting one of those letters, and thinking that it was more or less a "fuck you" from the SSA.

When I think about how much of my check is taken out for FICA, it comes in around 15%. That's a huge chunk. I mean, if I got that 15% every two weeks, that would improve my life greatly. Shaving a couple % is nice and all, but it's going to make SS/Medicare even less solvent.

Since we've established that the payroll tax is a punishment for the working class, I have a suggestion for how we might improve the overall funding problem. Remove the cap that is at 110k or 115k or whatever. If you make 1,000,000 dollars a year, you should have to pay the same percentage that I pay. Who gives a shit if you're not going to get it back? I'm not getting anything out of the deal, but I have to pay a higher percentage of my income. If you want to talk about regressive taxes, FICA absolutely classifies.

[Edited on December 8, 2010 at 8:07 PM. Reason : ]

12/8/2010 8:06:04 PM

^ Better idea: abolish FICA, make SS both means tested and pegged only to inflation, and pay for the overage with higher income taxes to compensate. Problem solved.

12/8/2010 11:19:45 PM

Quote :

"means testing medicare "

As luck would have it there was an article in Kiplingers this morning talking about medicare changes in 2011 and there is a means test next year. People earning over 85k (i think) will pay more, in some cases over double for their premiums.

^^you understand that the benefit is capped though. I actually think the cap is one of the only things that keep SS from being just another welfare program. You pay into the max amount a year, you get the max benefit. BTW, the cap does go up every year.

[Edited on December 9, 2010 at 9:23 AM. Reason : .]

12/9/2010 9:20:56 AM

Soc security is a simple math problem there are a few ways to keep the music playing longer before the ponzi scheme unravels. The problem with a typical ponzi scheme is it becomes difficult to continue finding new investors, the govt doesn't have that problem they just continue squeezing people until they break and eventually they reduce payout benefits.


Increse the %tax, increase retirement age, increase the cap on wages, decrease benefits. Those are the only ways to fix it unless wage growth takes place in this nation (hahahahaha). What they will do is implement a combination of the things (except they won't decrease benefits yet bc the affected voting bloc has too much power) and while the problem isn't solved it does keep the music on for the forseeable future.

12/9/2010 10:50:40 AM

http://politicalticker.blogs.cnn.com/2010/12/09/house-democrats-defy-obama-on-tax-cut-bill/

Might need to rename your title Pryderi

12/9/2010 12:11:38 PM