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Showing posts with label wealthtransfers. Show all posts
Showing posts with label wealthtransfers. Show all posts
"Mechanics of President Obama's Proposal to Raise Taxes on the 'Rich'"

"Mechanics of President Obama's Proposal to Raise Taxes on the 'Rich'"

TaxProf has a nice collection of links on Obama's tax the rich proposals available here.

Possibly one of the more interesting points that he links to is from the Tax Foundation:

The president and his economic team tend to dismiss the impact that such as tax hike will have on business activity because only 2 or 3 percent of taxpayers with business income are taxed at the highest rates.

While this statistic is true, the more economically meaningful statistic is how much overall business income will be taxed at the highest rates. For example, Treasury data for 2007 indicates that 50 percent of all pass-through income is earned by taxpayers subject to the top two tax brackets of 33 percent and 35 percent. . . .

No matter how you cut the data, the fact is that hiking the top individual income tax rates would amount to one of the largest single tax increases on individually owned businesses in modern history and a threat to the long-term economic health of the nation.

Tax $$$ for Rich, Educated, White: DC's Capital Bikeshare



This money was from a federal program that was supposed to "address the unique transportation challenges faced by welfare recipients and low-income persons seeking to obtain and maintain employment."  Yet, the people who benefited from the program are well to do.
49% of Americans live in Households Receiving Government Benefits

49% of Americans live in Households Receiving Government Benefits

From the WSJ:

. . . . The 49.1% of the population in a household that gets benefits is up from 30% in the early 1980s and 44.4% as recently as the third quarter of 2008.
The increase in recent years is likely due in large part to the lingering effects of the recession. As of early 2011, 15% of people lived in a household that received food stamps, 26% had someone enrolled in Medicaid and 2% had a member receiving unemployment benefits. Families doubling up to save money or pool expenses also is likely leading to more multigenerational households. But even without the effects of the recession, there would be a larger reliance on government.
The Census data show that 16% of the population lives in a household where at least one member receives Social Security and 15% receive or live with someone who gets Medicare. There is likely a lot of overlap, since Social Security and Medicare tend to go hand in hand, but those percentages also are likely to increase as the Baby Boom generation ages. . . .
An example of how wealth is transferred to favored businesses by the Obama administration

An example of how wealth is transferred to favored businesses by the Obama administration


This businessman worked on the Obama campaign and his firm handles the mandate that health care records be digitized. This guy argues that digitizing records will save money. But if that is true, why have to mandate that they do this? It is pretty amazing that this guy has the nerve to say that it is good to have this mandate when his firm personally benefits from the mandate.

About Half of All Americans Don’t Pay Income Taxes

Obama making life difficult for high income earners

Obama making life difficult for high income earners

This is one way to raise the effective tax rate for individuals, raising the probability that you will be audited.

If your income is high, your chances of getting a visit from the Tax Man are on the rise—and there isn't much you can do about it.

Last year, the Internal Revenue Service sharply increased face-to-face audits of upper-income taxpayers, according to data released Thursday. For taxpayers reporting income above $200,000, so-called field audits rose 34% in fiscal 2011 to 78,392, from 58,521 in fiscal 2010. (The IRS fiscal year begins on Oct. 1.)

Field audits, which are conducted by an agent, are often more in-depth than "correspondence" audits, which are conducted by mail and sometimes involve a single issue. Overall, the agency audited 3.9% of taxpayers with income above $200,000, up from 3.1% in 2010.

The increase in field audits for taxpayers reporting income over $1 million, though smaller, was still significant: 24%, for a total of 20,475 in 2011, versus 16,509 in fiscal year 2010.

Overall, the agency audited 12.5% of taxpayers reporting income over $1 million, compared with 8.4% in 2010. . . .


The Obama administration claims:

"We are looking more at taxpayers at these income levels because we find more issues there," says IRS Deputy Commissioner Steve Miller. . . .


But assuming that this error rate is true, it wouldn't be surprising simply because these people have more complicated taxes. Even the IRS makes mistakes on interpreting these complicated rules and they claim that more money is owed even when it isn't.

The bottom line though is that these efforts don't seem to be raising more money.

Overall, the IRS collected slightly less revenue from enforcement efforts in 2011, $55.2 billion versus $57.6 billion in 2010. Mr. Miller attributes the drop to anomalies, such as several large cases that were closed in 2010. . . .
Those horrible wealthy people: Seven of the ten wealthiest people in Congress are Democrats

Those horrible wealthy people: Seven of the ten wealthiest people in Congress are Democrats

Paul Caron links to this discussion in the Washington Post:

[T]he financial gap between Americans and their representatives in Congress has widened considerably since [1984], according to an analysis of financial disclosures by The Washington Post.
Between 1984 and 2009, the median net worth of a member of the House has risen 2.5 times, according to the analysis of financial disclosures, rising from $280,000 to $725,000 in inflation-adjusted dollars. Over the same period, the wealth of an American family has declined slightly, with the median sliding from $20,600 to $20,500. ... The growing disparity between the representatives and the represented means that there is a greater distance between the economic experience of Americans and those of lawmakers. . . .


Of course this is somewhat misleading as the price index for the wealth isn't the same as that for lower income individuals (Hint: they buy different things), and once you allow the index to vary you don't see the drop in median earnings and wealth as commonly assumed.

In addition, there is a strong argument to make that the CPI overstates inflation because it doesn't deal with the increasing quality of products. If an Apple iMac is the same as it was five years ago, would we really want to say that the price level has remained constant? Or that the quality of medical care or housing hasn't improved?

Adjusting for inflation the way it is commonly done is misleading.
Senator Harry Reid claims: "Millionaire job creators are like unicorns. They are impossible to find and don't exist."

Senator Harry Reid claims: "Millionaire job creators are like unicorns. They are impossible to find and don't exist."

Does anyone believe these claims by the Democrats? Are job creators really as imaginary as "unicorns"? Have Democrats ever heard of Steve Jobs or tens of thousands of other businessmen? From The Hill:

Senate Majority Leader Harry Reid (D-Nev.) suggested on Monday that millionaires who create jobs are a mere figment of Republicans' imaginations.

"Millionaire job creators are like unicorns,” said Reid from the Senate floor. “They are impossible to find and don't exist."

Reid's frustration has grown in past weeks as Republicans have repeatedly and overwhelmingly blocked almost every fragment of President Obama's jobs package brought to the floor because Democrats have attempted to pay for them by raising taxes on millionaires. Republicans say they oppose that tax because it would hamper job creation.

But Reid said Monday morning that there was no evidence of a correlation between taxes on the wealthy and jobs. . . .
"Overflowing" Government Subsidies

"Overflowing" Government Subsidies

It is bad enough that projects that don't pay for themselves are getting subsidies. The problem is that they are getting almost all their money from the government and (surprise) that the subsidies are haphazard. From the New York Times:

. . . Obama administration officials said the subsidies were intended to help renewable-energy plants that were jumbo-sized or used innovative technology, both potential obstacles to getting private financing. But even proponents of the subsidies say the administration may have gone overboard.

Concerns that the government was being too generous reached all the way to President Obama. In an October 2010 memo prepared for the president, Lawrence H. Summers, then his top economic adviser; Carol M. Browner, then his adviser on energy matters; and Ronald A. Klain, then the vice president’s chief of staff, expressed discomfort with the “double dipping” that was starting to take place. They said investors had little “skin in the game.”

Officials involved in reviewing the loan applications said that Treasury Department officials pressed the Energy Department to respond to these concerns.

Officials at both agencies declined to discuss the anticipated financial returns of the clean-energy projects the federal government has agreed to guarantee, saying the information was confidential. . . .

In at least one instance — NRG’s Agua Caliente solar project in Yuma County, Ariz. — the Energy Department demanded that the company agree not to apply for a Treasury grant it was legally entitled to receive. The government was concerned the extra subsidy would result in excessive profit, NRG executives confirmed.

In other cases, the agency required that companies use most of the Treasury grants that they would get when construction was complete to pay down part of the government-guaranteed construction loans instead of cashing out the equity investors.

“The private sector really has more skin in the game than the public realizes,” said Andy Katell, a spokesman for GE Energy Financial Services, which like Goldman Sachs, Morgan Stanley and other financial firms has large investments in several of these projects.

But there is no doubt that the deals are lucrative for the companies involved.

G.E., for example, lobbied Congress in 2009 to help expand the subsidy programs, and it now profits from every aspect of the boom in renewable-power plant construction.

It is also an investor in one solar and one wind project that have secured about $2 billion in federal loan guarantees and expects to collect nearly $1 billion in Treasury grants. The company has also won hundreds of millions of dollars in contracts to sell its turbines to wind plants built with public subsidies. . . .
Does Obama decide where to give talks based on whether donors own the company?

Does Obama decide where to give talks based on whether donors own the company?

Another Obama proposal that will benefit a big donor? Why did Obama pick this company to give a talk at? From the Weekly Standard:

President Barack Obama will tout his American Jobs Act at WestStar Precision, a small business run by a donor to the president's inaugural, in Apex, North Carolina on Wednesday, September 14. WestStar’s president, Ervin Portman, is a Democratic county commissioner for Wake County who donated $1,000 to the Obama inauguration fund. Portman also donated through Act Blue, a progressive PAC, toward the successful 2008 campaign of Senator Kay Hagan (D-N.C.).

According to the White House press office, WestStar is a company “that will benefit from the bipartisan proposals in the American Jobs Act.” Obama’s tour of the company’s 10,000-square foot office and warehouse will be followed by a speech at North Carolina State University in Raleigh, where the president will continue to urge that Congress pass his plan. . . .
Obama's Political payoffs to Government Unions

Obama's Political payoffs to Government Unions

Michael Barone gives Obama heck for his new "jobs" speech. One part of it is here.

Political payoffs. Nearly one-quarter of this latest stimulus package -- sorry, American Jobs Act -- is aid to state and local government, to keep teachers and other public employee union members on the job and paying dues to the unions. Altogether unions gave Democrats some $400 million in the 2008 election cycle. Pretty good return on their "investment," eh? . . .


In addition, at the same time that Obama speaks of "This isn't political grandstanding," he also says:

Conservatives, according to this speech, want to "wipe out the basic protections that Americans have counted on for decades" and "simply cut most government spending and eliminate most government regulations."


He claims that his speech "isn't class warfare," but then he says:

These sentences came four paragraphs after Obama insisted that "the most affluent citizens and corporations" should pay more taxes (which spurs job creation how?) and not long before he promised to "take that message to every corner of the country." . . .
Only 1.75 Full-Time Private Sector Workers Per Social Security Recipient

Only 1.75 Full-Time Private Sector Workers Per Social Security Recipient

This is one side effect of so many people dropping out of the labor force. Anyone have an idea how high Social Security taxes have to be if there are only 1.75 private sector full-time workers paying taxes for every person getting benefits? The problem is that a lot more people are going to be retiring soon. This also provides some background for Obama's chosen method of cutting taxes. From CNSnews.com:

There were only 1.75 full-time private-sector workers in the United States last year for each person receiving benefits from Social Security, according to data from the Bureau of Labor Statistics and the Social Security board of trustees.

That means that for each husband and wife who worked full-time in the private sector last year there was a Social Security recipient somewhere in the country taking benefits from the federal government. . . .


Gov. Rick Perry might be on to something in calling Social Security a “Ponzi scheme.”
Michael Barone: Obama's Gangster Government

Michael Barone: Obama's Gangster Government

Michael Barone doesn't mince words:

Most important, it requires the General Accounting Office to conduct an audit of the waivers from the Democrats' health care bill that are being issued in large numbers by the secretary of health and human services.
This will raise an uncomfortable question. If Obamacare is so great, why are so many trying to get out from under it? And, more specifically, why are so many Democratic groups trying to get out from under it?
The fact is that HHS Secretary Kathleen Sebelius has granted more than 1,000 waivers from Obamacare. Many have been granted to labor unions. Some have been granted to giant corporations like McDonald's. One was granted to the entire state of Maine.
By what criteria is this relief being granted? That's unclear, and the GAO audit should produce some answers. But what it looks like to an outsider is that waivers are being granted to constituencies that have coughed up money (or, in the case of Maine, four electoral votes) to the Democrats.
If so, what we're looking at is another example of gangster government in this administration. The law in its majesty applies to everyone except those who get special favors.
The GAO has also been ordered to produce audits on the effect of Obamacare on health insurance premiums. This is likely to reveal that the president did not keep his promise that you could keep your current health insurance if you want to.
And there will be an audit of the comparative effectiveness bureaucracy established in the 2009 stimulus package. Comparative effectiveness is supposedly an objective study of which medical techniques are most effective. But anyone who looks closely finds that the experts are constantly changing their minds, which suggests that this is more alchemy than science -- and maybe political favoritism, as well.
All of which tends to undercut the thrust of Obama's obviously-aimed-at-the-2012-campaign message: We can continue to fund Medicare and Medicaid indefinitely if we just tax rich people a little more. . . .
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