Taxes Raise/Cut ?

[DOGS THAT BARK]

No doubt which side both part parties lean to--some food for thought---appears highest was just prior to 911 which was one of greatest hits on economy ever.

from AP--believe it or not




April Tax Revenue 2nd-Highest in History
May 10 2:23 PM US/Eastern
Email this story

By MARTIN CRUTSINGER
AP Economics Writer


WASHINGTON


A flood of income tax payments pushed up government receipts to the second-highest level in history in April, giving the country a sizable surplus for the month.

In its monthly accounting of the government's books, the Treasury Department said Wednesday that revenue for the month totaled $315.1 billion as Americans filed their tax returns by the April deadline. The gusher of tax revenue pushed total receipts up by 13.4 percent from April 2005.

It marked the largest one-month receipt total since the government collected $332 billion in revenue in April 2001, reflecting a boom in capital gains from stock investors lucky enough to cash out their investments before the bursting of the stock market bubble in early 2000.

 

[djv]

It almost has me looking over my shoulder. I like tax cuts that work. For everyone. And are payed for. I would like interest back down to 2.5%. Gas and interest rates wiped out most folks tax breaks about 2 years back. Lots of folks don't even know how much it's cost them. Because they don't have budgets. When you have folks taking out 40 to 50 year home loans you know there are problems.

 

[Chadman]

Interesting to say the least, Wayne. Checked my usual left-leaning haunts this AM to see if there were some left-leaning disputes to what I'm sure will be trumpeted politically by the right, but found none. I've been thinking a lot about the economy which at simple face value reads pretty well, and wondering if it actually is or if there are factors involved with pushing it up. There are always two reads on general numbers, and will look more into this.

Some random thoughts: The market is very high overall right now, and would guess that capital gains payments would be pretty high and follow that. I'm wondering if the skyrocketing gas prices have something to do with tax collections being higher than normal of late...all of us are paying more every time we hit the pump, so I would assume that would add some tax revenue. Products in general that are created with oil products or have to be transported from one place to another probably cost more, so that would add some tax revenue. Cost of living is probably higher than in past years, adding some.

I can't think that people, with the high price of gas for the past few months, just purchased a lot of things in May and April - moreso than in previous months and years.

I would not have expected it (the jump), really. I wonder if the war in Iraq has anything to do with tax revenues in some ways. Never really thought about it. Would like to hear some opinions and random thoughts about Wayne's post here and what you guys think.

 

[DOGS THAT BARK]

some added opinion Chad---personally I don't think GW's individual tax cuts had much to do with it--but think some corporate tax breaks did. I don't think gas tax counts on this--but if it did it should not vary as it is constant--taxes per oil company profits would be relevant.

As I said many times I don't think GW has any more to do with economy than Bill did. If they stay out of way things will pretty well take care of themselves. I can't see economy continuing at anyway near current rate with oil prices high. I think folks are having a little unwarrented uphoria--however one postive note is corparate earnings have been good and should have a big bust that resulted when people were betting on the come with the unbelievable PE ratiio's that killed them in the dot.com era.

--of course if I knew these things to be true and not just speculating I'd be rich and I'm not.

--latest blunder put stop loss on China Petro @ 110 dropped below that for about 2 minutes on 27th of may(and sold) 109.90 and 118 less than 3 weeks later

 

[djv]

DTB and I'm down to 300 shares of ASD But it just seems to keep surprising. I just believed what I was getting from inside the company the run was done. However putting a bunch in gold 3 moths ago has worked. But the I want to jump out of gold is getting heavy on my mind. And I like you hate guessing. But a profit is always better in my mind then greed. So we just have to keep working the market as best we can.
And the vote today for that tax cut. May help some. But You need to make over $85.000 to start getting a nice cut. And those down under $47.000 will see about 50 bucks. Is it right or wrong who knows? But I would guess we have many more folks making less then 80 grand in this country then over.

 

[dr. freeze]

those down under 47,000 pay about 0-4 grand while those paying at 85 grand pay 10-15 grand

how exactly are those under 47K getting screwed?

 

[BobbyBlueChip]

You won't find any info on the sites, Chadman; it takes the left a bit of time to get through the numbers. It wasn't the democrats that found out the admin was lying to everyone, it was the business reporters who couldn't figure out why the projections of growth rate of GDP that justified the tax cut was 5 times as high as the projection that justified social security privatization.

When you hear the Bushies talk about the deficit, it's always as a percentage of GDP, but when they finally after 5 years of tax cuts catch up to the revenue of the Clinton tax plan - it's Record Setting!!!

Even in real dollars, I couldn't believe that the story was true, so I compared the treasury report issued this month to the treasury and noted that the makeup of the increase since 2001 is almost entirely made up of payroll taxes which is the only regressive tax that the federal gov't has. These are all 7-month figures.

2006 2001
October 149,488 135,111
November 138,840 125,666
December 241,883 200,489
January 230,010 219,215
February 112,853 110,481
March 164,563 130,074
April 315,090 331,796

1,352,727 1,252,832

2006 2001
Individual 601,533 657,281
Corporate 174,258 105,158
Social Security 481,651 403,806
Excise 40,940 38,266
Estate and Gift 16,568 17,840
Customs 13,633 11,299
Miscellaneous 24,144 19,182

1,352,727 1,252,832

When you have a government that spends as much as this one does (outlays $1,536,000(2006) vs. $1,087,000(2001)), that money should be coming back into the treasury in the next year through through income taxes, but even with these spending habits, the revenues have just reached 2001 levels.

Tax revenue increase through payroll tax and they call it a trickle down. Too funny

 

[DOGS THAT BARK]

I'd be interested in what your trying to say in laymen terms BBC. :shrug:

Are you trying to tell us the economy was stronger under last admin?

Do you think taxes are good for economy?

per your--

"When you have a government that spends as much as this one does (outlays $1,536,000(2006) vs. $1,087,000(2001)), that money should be coming back into the treasury in the next year through through income taxes, but even with these spending habits, the revenues have just reached 2001 levels"

do you think 911-2 wars and greatest natural disasters of all time might have "anything to do with expenditures?

per your--

"When you hear the Bushies talk about the deficit, it's always as a percentage of GDP, but when they finally after 5 years of tax cuts catch up to the revenue of the Clinton tax plan - it's Record Setting!!!"

Didn't realize that 2000 to 2001 was 5 years???
I'll repost AP'S last paragraph for your benefit--

It marked the largest one-month receipt total since the government collected $332 billion in revenue in April 2001, reflecting a boom in capital gains from stock investors lucky enough to cash out their investments before the bursting of the stock market bubble in early 2000.

 

[dr. freeze]

Note how the left wing media will never miss a chance to say who has a "bigger tax cut" but has anyone ever seen them show us how much these groups actually pay in comparison?

NEVER!!!

If they were fair and balanced, they would portray AS LOUDLY (in headlines) the REAL TAX DOLLARS under both plans AS OFTEN as they scream "bigger tax breaks for the rich" etc. etc.

Why give only one side of the story????

 

[DOGS THAT BARK]

Don't Believe Everything You Hear

Thursday , May 11, 2006

By Tobin Smith




2. THE KAHUNA'S RANT O' THE WEEK: Don't Believe Everything You Hear

I continue to be amazed that Americans can be so gloomy over the state of the economy with 4.7 percent unemployment rates.

But then I remember that there are millions of people who honestly believe that the tax cuts from May 2003 have NOT had a positive effect.


Which proves and indisputable fact: when it comes to public perception, HE who has the biggest microphone wins the minds of the majority.

I read 10 newspapers a day, listen to dozens of news reports and watch a little TV when I'm not working or on the golf course.

Nowhere have I read (with a few exceptions) the following ACTUAL official economic data statistics shared with the American taxpayer:

1) Real GDP expanded more than $1 trillion ? or 11 percent ? between the first quarter of 2003 and the end of last year.

2) Five million new jobs were created ? more than Japan and Europe combined.

(And by the way, when the guy on TV says that more jobs were created in past recoveries, remind yourself that in this recovery ? the one in the 21st century ? fewer jobs were lost in the contraction phase because our economy today is only 14 percent manufacturing versus 25 percent or 30 percent as in past economies.)

It is like apples to oranges to compare an economy that lays off huge amounts of manufacturing labor going into a recession only to hire back the same people later and call that "job creation." We have "created" fewer jobs in this recovery simply because we laid off millions fewer people from manufacturing jobs.


3) Real (after inflation) personal income has mushroomed up 5.7 percent on a compounded rate from first-quarter 2003 ? that's almost $2,100 in more after-tax personal income per capita!

4) Industrial production is up $300 billion in the last three years (despite the cries of "you outsourced my job"). We did not outsource anything that did not deserve to be outsourced ? what we did was improve productivity 3 percent a year.

5) Between the second quarter of 2003 and the end of 2005, 3.9 million new businesses were started, replacing the weak and wobbly businesses that always go away during a recession. It's called creative destruction, and it is the secret ingredient to our world-leading rates of returns of capital invested and productivity achieved.

A DEFICIT OF FACTS

So why do people, when polled, say their confidence in our economy is in the tank?

Because that's the ONLY message that seems to be getting out to them. When a president's approval rating drops to 30 percent ? and below 50 percent in his own party ? the megaphone is not his any longer.

The only thing we have to fear is the fear mongers themselves, but right now the fear mongers dominate the media and so the masses are fearful.

The fear mongers love to talk about how the trade deficit setting up our country for economic Armageddon.

The U.S. has run a "trade deficit" as currently defined for about 350 of the last 400 years.

We run a trade deficit with the world because our economy is larger than Europe, Japan and China put together! You have to get your mind around the reality that the economic scale of the United States versus the rest of the world is NOT comparable ? not even close.

If you were to take the production of goods and services of U.S.-owned subsidiaries that sell OUR stuff (made somewhere else) and subtracted that GDP from the "deficit," you would see how small our actual trade deficit really is.

Furthermore, to obsess over one number as if it were hermetically sealed-off from the rest of economic measurement ? i.e., capital inflows, personal incomes, corporate profits, personal and corporate wealth accumulation ? is as insane as asking former House Majority Leader Tom DeLay to teach an ethics in government class.

THE PURSUIT OF HAPPINESS

Through education, hard work, taking risks once in a while, and entrepreneurship or intrapreneurship, there are GREAT opportunities for Americans to improve their economic circumstances.

But financial wealth in itself does not make anyone happy ? the pursuit of financial wealth alone does not end with bliss.

You have to make very large investments of your time, your love and your energy in building a portfolio of emotional assets ? the things, people, activities, places and pursuits that actually bring or pay the "dividends" of joy, laughter, engagement and ultimately fulfillment.

People's short-term "happiness" with the economy comes and goes with whomever and whatever dominates the short-term news.

What you should care about is YOUR emotional assets and financial asset portfolio management and leave the belly aching to those who look for self-fulfillment in the actions and activities of others.

As long as you keep informed with the actual data and forget the agenda-laden doomsayers selling illusory redemption from quasi-socialism, you will be long the most advantaged stocks in the world and you'll tune out everything else.

Toby

Tobin Smith is a ChangeWave Research editor and regular FNC business contributor.

 

[Chadman]

I don't have much time this morning, but a couple of things. Freeze piping in again, griping about the tax system is no surprise. Beating a dead horse again, I'll ask you, Freeze, what is a fair tax rate for you? Or anyone, for that matter? I'd like to hear some solutions or a better way. Glad to see and discuss it.

One thing I don't understand, speaking of contradictions. If our economy is doing so well right now - to the point, supposedly of adding % to interest rates to help cool it - does it make sense to push for more tax cuts? Aren't they done to supposedly stimulate the economy? That's what we were told, right? I keep hearing from the administration and MJ's conservatives that the economy is in great shape, so why the need for more cuts?

I think the current round of cuts are skewed more to the upper class, aren't they? Meaning they are getting a higher percentage cut than the lower class. At least that's what I heard all over talk radio yesterday...maybe not. I think that is a contention.

Finally...these tax cuts essentially, considering the skyrocketing mountain of debt under this administration are essentially tax increases on our children and grandchildren. Because at some point, we will have to pay down our mountains of debt, and it won't be these guys that will have to do it. I think that's morally a bankrupt policy, and reprehensible.

IT'S WAR TIME, for God sakes. What other administration that took us to war has had the gall to also ask us to sacrifice nothing and make sure the upper class gets $41,000 to put in their retirement accounts? It's a fricking, embarrassing joke. Again, only some have to sacrifice, to make sure the select few benefit. Defend my freedoms, give me more money, stay out of my yard.

Whatever, Freeze.

 

[BobbyBlueChip]

dogs, have to get to work so my clients can file so that they can continue to have access to capital markets

In a sentence, Laffer's theory that a decrease in tax rates increases tax revenues is bs and the only way that it comes close to working is if the gov't increases spending so that they can throw money into the economy that will add to the tax base the next year.

I'll get back to your other questions tonight because you always address mine, but that's the gist.

 

[djv]

I still say with take home pay down something is wrong someplace.
The need for 6 year car loans and 40 to 50 year home loans should throw up red flags. I feel sorry for folks having to pay all that extra interest money for those items. And if true 5 million jobs with lower take home pay. Well I guess it's better then Bush's first two years of just about no jobs. Two wars have helped him some what. With all the guard in Iraq or called to duty other places. Had to open up some jobs. As for tax cut don't believe Doc I said anything about getting screwed. I asked is it fair? I don't know. I only know majority of Americans are getting little from it. It looks top heavy.

 

[Chadman]

The funny thing is, Bush is so committed to tax cuts at all cost, and advocating smaller government (which is a complete joke - he is actually for reducing expenditures on things he and his buddies don't like and expanding expenditures on things that benefit them) while ballooning our federal deficit. Did you guys know that the third largest slice of your tax dollar goes to paying back interest on the National Debt? In 2005 alone, we paid $348.5 billion towards National Debt interest responsibilities. Stop and think about that. If we were committed to a balanced budget and reducing the national debt, we could wipe out interest payments in the future, which could actually result in lower taxes for everyone - or the wealthy, or whomever.

Dogs, maybe you can toss in a Clinton reference here...you remember...the guy who was in charge when we attacked the National Debt and actually gained a budget surplus?

My reference on this is here: http://www.nationalpriorities.org/taxday06sources

So, for those that continually cry about our "entitlement" programs, maybe you should think about what your tax dollar really pays for, and ways it could be helped. Your Bush boy ain't helping you much, in the big picture. Unless, of course, you are one of the upper 1%. Then you get immediate help - and our children - will make up for that.

 

[DOGS THAT BARK]

Thats fine Booby I understand where your coming from--been busy as hell myself.

Chad --he should have had surplus didn't take near as much to fix partially damaged trade cetner and he surely didn't spend anything on retaliation--I will say in his defence he did try and increase defence budget--on the 348.5 billion spent in 05--do you know how much was spent in 99? Doesn't make any diff who's in --you can't spend more than you take in. Personally I think short term war-catastrophes ect are necessary--but I'll climb on GW's back with you on never ending payments for entitlement programs--eg --the medicare package.

DJV I've seen you ask this question before so I'll respond--

" still say with take home pay down something is wrong someplace.
The need for 6 year car loans and 40 to 50 year home loans should throw up red flags. "

Theres nothing wrong with take home--its for those who couldn't afford to get home with lowest interest rates--and easiest financing in 40 years. Believe those never married with 5 kids might get in on this on their welfare payments alone.

Now think about it. Do you know of any workers who have been without raise in last 5 years or had to take a reduction in pay --if not there are only 2 things that could reduce their spending power--taxes and inflation--despite gas prices inflation has been held in check overall (so far) and your "against" those cutting taxes and "for" those that want to raise them--so that shouldn't be an issue.

 

[Chadman]

Not sure if you are suggesting that the bombing of the WTC and federal costs associated with repairing that are a main reason for the Bush deficits (and Clinton surpluses) or not, but I was curious if that had any merit. I Googled it and found this link:

http://www.usmayors.org/uscm/us_mayor_newspaper/documents/03_18_02/nyc_bush_aid.asp

According to this, the government pledged about 21 billion dollars to the state of New York which would come out of the federal monies. I don't know if Clinton pledged any federal money or not back in the day, but I can only find about 21 billion to add to Bush's tote. Hardly a budget buster compared to his toteboard, I don't think. Pales in comparison to his other pledges and choices, that's for sure.

 

[BobbyBlueChip]

I'd be interested in what your trying to say in laymen terms BBC. :shrug:

Are you trying to tell us the economy was stronger under last admin?

Do you think taxes are good for economy?

per your--

"When you have a government that spends as much as this one does (outlays $1,536,000(2006) vs. $1,087,000(2001)), that money should be coming back into the treasury in the next year through through income taxes, but even with these spending habits, the revenues have just reached 2001 levels"

do you think 911-2 wars and greatest natural disasters of all time might have "anything to do with expenditures?

per your--

"When you hear the Bushies talk about the deficit, it's always as a percentage of GDP, but when they finally after 5 years of tax cuts catch up to the revenue of the Clinton tax plan - it's Record Setting!!!"

Didn't realize that 2000 to 2001 was 5 years???
I'll repost AP'S last paragraph for your benefit--

It marked the largest one-month receipt total since the government collected $332 billion in revenue in April 2001, reflecting a boom in capital gains from stock investors lucky enough to cash out their investments before the bursting of the stock market bubble in early 2000.

Sorry I didn't get back to you, DTB, Chinese holding co's buying up everything in sight around here.

The gist of the point that I was making was that the increase in receipts isn't related to the reductions in the tax rates, it's related to the gov't spending of the last several years. For every $ that goes out in one year, $0.30 should come back to the government the next year through tax on the revenues.

But, what I though was interesting, even as the GDP grows, the receipts finally caught up with the year before W came into office. And through the 7 months of the 2006 fiscal year compared to 2001, the increase in receipts is roughly $100 Billion, and $80 billion of that increase is due to increases in receipts from payroll taxes (which just happens to be the only regressive federal tax that there is)

There's just never been any proof that tax rate increases hurt domestic growth and in the 90's it worked and we had surpluses (with no detriment to the economy) and if we have a need to increase spending, then we need to increase government receipts. It's what grown-up nations do.

The fear that I have is that once the deficit becomes too large to ever pay down, we'll just try an inflate away our debt like Latin America countries do and then the hyper-inflation that follows will destroy what's left of the middle class. It won't be pretty and it won't be "American"

 

[DOGS THAT BARK]

Interesting on Chinese co BBC--What is name of company--wouldn't be Lenovo Group would it?
-- hope wer don't have replay of Japan/Hawaii

I think we are in ageement that spending is prob bigger culpert than taxes. If you spend more than you take in you have to pay the piper.

Wouldn't low taxes and spending be nice

 

[BobbyBlueChip]

It's a local corp and I can't name names, but the prospects are interesting as far as the industries that they're trying to consolidate into. All the M&A plans look great in the beginning, but it's a bitch trying to get everyone under the same banner.

Tough to get re-elected with campaigns the way that they are if you want to be fiscally responsible. Every tax cut you voted for is used against you and you vote down some pork spending bill and then you get ads against you saying that you voted against "defense" 19 straight times.

I really hope the U.S. can grow up pretty fast and start being a bit more responsible.

 

[gardenweasel]

""There's just never been any proof that tax rate increases hurt domestic growth and in the 90's it worked and we had surpluses (with no detriment to the economy) and if we have a need to increase spending, then we need to increase government receipts. It's what grown-up nations do."


i`m admittedly a little out of my depth here.....but,which grown up nations were you referring to,bobby?

the stats are a little long in the tooth,but,

""Taxation as a percentage of GDP is today (2003) 56.1% in Denmark, 54.5% in France, 49.0% in the Euro area, 42.6% in the United Kingdom, 35.7% in the United States, 35.2% in The Republic of Ireland, and among all OECD members an average of 40.7%. (OECD national accounts) (Forbes magazine)....

""Google the words “sluggish U.S. economy” and “2004,” and in 0.40 second you get 4,540 results. “Weak employment report points to still-sluggish U.S. economy,” reads a recent headline, on the news that “just 112,000″ jobs were added in November.

""Well, we live in a world economy, so when headline writers use the word sluggish, we have to ask: ""Sluggish compared with whom?"" According to the November forecast of the Organization for Economic Cooperation and Development, gross domestic product in the U.S. is expected to increase by 4.4% in 2004. Elsewhere, the OECD predicts growth of 4% for Japan, 2.7% for the U.K., 2.1% for France and 1.2% for Germany. For the 12-country euro zone, the figure is 1.8%. To put matters in historical perspective, the last time Japan, Britain, France and Germany had growth rates at or in excess of 4.4%, the years were 1990, 1994, 1989 and 1991, respectively.

But, some say, America’s current economic performance is sluggish compared with its past performance. So let’s look at the data again. From 1997 through 2000–the great Clinton go-go years–U.S. growth averaged 4.25%. For Mr. Clinton’s first term, the average was 3.3%. For the eight years of the Reagan presidency, it was 3.4%. By what standard, then, can this year’s forecasted 4.4% be described as sluggish?

Maybe it can be argued that it’s been sluggish in terms of job gains. It is true that in 2004 there were some months when job growth failed to meet expectations, although there were other months when expectations were exceeded. Here again, however, it’s worth putting things in an international perspective. Overall, the U.S. economy has added 2.3 million jobs since the third quarter of 2003, bringing the unemployment rate down to 5.4% from 6% in October 2003. In Germany, the unemployment rate is 10%; in France it’s 9.5%. For the 27 countries of the OECD, the average unemployment rate is 6.8%. Only Britain and Japan, among the major economies, have unemployment rates lower than the U.S. OK, say the critics, but what has given the U.S. numbers a boost is that some people have so despaired of finding work that they’ve just dropped out of the job market. Yes, the rate of workforce participation in the U.S. declined slightly in the Bush years, from 76.8% in 2001 to 75.8% in 2003. But that still beats rates in Japan (72.3%) Germany (71.3%), France (68.2%) and Italy (61.6%).

Even more revealing are the figures for long-term (12 months-plus) unemployment, as the nearby table shows. Here again, the U.S. looks good. Put simply, about 90% of Americans who lose their job can expect to find another within a year. Lose your job in Europe, and you face far more daunting odds."""

it appears that our tax rates are generally lower...while our economy remains basically the world`s strongest...

as i said,not my area of expertise...but,dogs points regarding the war(s),iraq and afghanistan, and some incredible natural(katrina) and unnatural(9/11) disasters skew tend to skew any recent figures(particularly the deficit)...

that`s all i got....my jumping into this conversation is akin to doing brain surgery with spoons.....

beat me like a rented mule...