Posted by Larry Doyle on September 21st, 2012 3:40 PM |
I will leave it to readers to make their own assessments as to what they think of Dick Morris’ assessment of President Obama’s tax plans. However you lean — and before people unsubscribe from my blog — do yourself the favor of viewing this 4-minute clip.
Regardless of your political persuasion, I think that even a whiff of these tax programs can do nothing but put a significant dent into the economy while elevating the unemployment rate . (more…)
Posted by Larry Doyle on September 14th, 2012 12:43 PM |
When politicians out there want to talk about “fairness in the tax code”, you may care to forward them the bar graph highlighted below.
With credit to the folks at Business Insider,
Here are the income taxes paid by the respective income percentiles. Note how little the bottom half pay (blue). Note how much more as a percentage of the whole the top 5% are paying. (more…)
Posted by Larry Doyle on May 28th, 2010 10:38 AM |
Thank you to a loyal Sense on Cents reader for sharing more details about one of life’s two great certainties and how increased taxes will be coming your way. These details are highlighted in a recently released Credit Suisse research piece, Washington Notes:
While many questions have been raised about the ability of the Administration and Congress to find funding for the new initiatives, it is clear that a reduction in current spending alone will not be enough to cover new programs and therefore it will be necessary for the President and Congressional Democrats to rely heavily on increasing taxes. (more…)
Posted by Larry Doyle on April 5th, 2010 11:13 AM |
If we are to believe the markets are predicting a rebound in the economy (I do not blindly accept that to be the case), then it is high time we address the next enormous question facing our country. That is? The bill that has been accruing for the ‘so-called’ saving of our economy.
Whether the economy has been saved or not is a relative question. Please be careful as to how to use that phrase in light of the fact that there are 6.5 million people out of work now for at least 27 weeks (long term unemployed) and close to 17% of our labor force is underemployed.
The biggest question facing our country now is how do we pay for cleaning up this mess that was created over the last number of years? (more…)
Posted by Larry Doyle on December 9th, 2009 9:04 AM |
You’re a mean one, Mr. Grinch…!!
Are British bankers headed to the pub early today to drown their sorrows? Little doubt, as the Chancellor of the Exchequer Alistair Darling (British equivalent to Treasury Secretary Tim Geithner) announced that year-end bonus pools for British banks will be hit with a one-time, top line tax of 50%!! Ouch!!
Bloomberg provides a brief synopsis this morning in writing, Darling Levies 50% Tax on U.K. Bank Bonuses Above 25,000 Pounds:
Chancellor of the Exchequer Alistair Darling said he will impose a one-time 50 percent tax on banks for all bonus payments of more than 25,000 pounds ($41,000).
The tax, effective from today until April 5, will be levied as a surcharge on the employer. It will apply to all banks and building societies operating in the U.K., including subsidiaries of foreign banks.
The Treasury estimates the tax will raise about 500 million pounds and affect about 20,000 bankers.
What does this mean? Take 50% off the top line of the bonus pool and then distribute the balance. Those bonus proceeds are then subject to the U.K.’s current tax rates, the maximum of which is right now 40%.
Add it all up and the effective tax rate for the majority of the bankers impacted is between 65 and 70%!!
What does the crowd in Washington and on Wall Street think about that?
While I am not one for increasing taxes, the fact is the British banks and the U.S. banks were saved by the taxpayers. This tax is merely a return of some of the taxpayers’ money.
While the bankers will view Darling as Mr. Grinch, do you think the unemployed laborer in the U.K. or here in America has any real sympathy for those in the City or on Wall Street?
Would the crowd in Washington have the stones to impose a similar one-time hit on Wall Street?
Posted by Larry Doyle on November 12th, 2009 2:25 PM |
No, these states are not holding a Powerball Lottery . . . although the states themselves could use the winnings.
These states, amongst others, are barreling toward economic disaster. Don’t take my word for it. None other than the Pew Center on the States produced a report entitled Beyond California: States in Fiscal Peril:
(High five to MC for bringing this to our attention)
California’s financial problems are in a league of their own. But the same pressures that drove the Golden State toward fiscal disaster are wreaking havoc in a number of states, with potentially damaging consequences for the entire country. (more…)
Posted by Larry Doyle on July 13th, 2009 5:13 PM |
How does a politician pretend to keep a campaign pledge and simultaneously fund a ballooning deficit? Very skillfully. Do not be surprised to see some sleight of hand in the process. How does one define tax increase and on whom? Let’s play politics, Washington-style.
While Obama rode his promise of only increasing taxes for the top 5 % of wage earners in our country, no credible analyst currently believes that. Bloomberg’s Al Hunt opines, Obama Can’t Avoid Taxes in Fixing Fiscal Mess.
With our deficit soaring, tax revenues plummeting, and a whole set of new federal programs coming online, Obama and team have no choice but to craft new taxes. Hunt proposes:
While the majority of a deficit package will likely consist of enhanced revenue, that’s complicated by three painful realities: Some of the most palatable initiatives will be skimmed off by the costly health-care and climate change legislation; the president made a campaign commitment not to raise taxes on anyone making less than $250,000 a year, and huge amounts of money have to be raised.
Compared to boosting taxes directly on middle-income earners or slashing domestic programs, a value-added tax as a partial replacement for income and possibly some payroll taxes may be a more attractive alternative, Altman believes. A growing number of Democrats, such as Senate Budget Committee Chairman Kent Conrad and Obama tax-reform adviser Paul Volcker, concur.
If so, it will cause a political bloodbath, particularly if it is a big net revenue-raiser. The “sales tax” label can be lethal. Consumption levies are usually regressive, hurting middle class and poorer people the most, and almost three decades later there remains a belief that espousing such a measure cost the former House Ways and Means Committee Chairman Al Ullman, now deceased, his supposedly safe seat in 1980.
Raising taxes is often a death knell for a politician, so I find it very interesting that Altman, Conrad, and Volcker are looking for an approach to raising taxes which is politically expedient. Nothing better than proposing a tax which has not been previously used in the United States. The VAT, more commonly delineated as the value-added tax, is widely utilized in the European Union.
Make no mistake, though, the VAT is a form of a sales tax and ultimately gets passed along to the consumer. As such, it is typically considered a regressive tax, that is, a tax which more impacts the lower and middle incomes.
In true political fashion, our leaders are as much concerned with the delivery and appearance of these tax increases as they are the results. Hunt asserts:
Conrad believes that once politicians look at the challenge — deficits as far as the eye can see, insufficient savings, over-reliance on regressive payroll taxes — “a value-added tax in combination with a high-end income tax” will seem more acceptable than directly hitting middle-and upper-income taxpayers.
While politicians will not tell you taxes are going up, they are not being straightforward on this issue. No matter how you slice it, taxes are going up on everybody.