05-31-12, 09:57 AM #81
The 10 year phase is ideas I illustrated here:
(1) All income is treated the same.
(2) Except in war time, Government runs on a "pay as you go" system. I. e. Each new expediture bill in Congress passes thru the CBO to get at least its current year cost impact evaluated and the CBO then announces that the "tax adjustment factor," in the tax calculation equation will for example, will be bumped up from 1.235 to 1.245 by it if that bill becomes law.
(3) There are no special tax breaks. Everyone pays from the same progressive rate schedule
(4) Accumulated wealth (when large say > 50 million dollars) is tax by progressive schedule too, but giving wealth to IRS qualified groups can reduce income by half the gift total (and obviously reduces "accumulated wealth" by 100% of the gift.) This encourages the wealthy to support IRS approve organizations.
(5) US corporations are not taxed but must distribute 100% of their profits after some (10?) years delay to tax payers, who typically will pay a higher marginal rate than the corporations did.
Last edited by Billy T; 05-31-12 at 10:43 AM.
05-31-12, 03:01 PM #82
I don't want to get into a long-winded analysis of that idea right now, so let me just point out that if you legislate that the only way for politicians to enact deficit-financed economic stimulus is via declaring a war, then the result will simply be a lot more declarations of war, rather than a lot less deficit-financed stimulus.
Moreover, I can only think of one period in the last several decades in which a Democrat was in charge during a boom time in the economy. It was the 1990's, and the result was that the national debt got reduced substantially. A larger analysis of the behavior of the debt under different parties' control likewise refutes your equivocation. So, I reject the premise that there is a problem that requires a systemic solution here - all we really need to do is vote for Republicans less often, until they get the message and start following through on their rhetoric about balanced budgets.
In point of fact, Social Security will require only a minor haircut in benefits (or minor boost in taxes) to render it solvent indefinitely. You're probably thinking of Medicare.
In point of fact, though, Social Security only barely runs a surplus these days and so almost all of the money paid in just gets paid out to current retirees. In a few more years, there will be no money invested in T-Bills.
Also, even if your average homeowner does end up with the same final income, getting rid of the mortgage interest deduction will still distort the housing market in a systemic, long-term way that will crunch an entire generation of voters. This is because you are getting rid of an incentive to buy, instead of rent - and so, even if everyone still has the same amount of money, they will not want to buy as many houses with it as they did under the subsidy, and so the value of homes will decline. So even if everyone can still afford their mortgages, your still devaluing the single biggest asset that most voters will ever own.
Note that the flaws you claim to be addressing in the current system are themselves matters of political will, and not statutory details. There is no tax code you can come up with that can prevent a democratic populace from voting itself the ability to borrow money.
And if you think anything close to all fo the Boomers have paid off their mortgages, you've missed a lot of economic trends in the USA in recent years. 63% of Americans in the 55-65 age range still have mortgages, and the amount owed by said group has exploded in recent decades.
05-31-12, 03:09 PM #83
Yes those with larger TOTAL income will pay higher percentage on any "progressive rate schedule." But their tax on the 100th dollar they earned is at the SAME rate as everybody else´s 100th dollar earned. Likewise all who earn their 100,000th dollar pay the same rate on it.
Last edited by Billy T; 06-01-12 at 10:09 AM.
05-31-12, 09:15 PM #84
Not selling...leasing. Far more money can be made over a long time period by leasing than selling.
Sadly, most governments have given away or sold off most of the valuable land they could have used as a revenue resource for centuries to come.
Last edited by Carcano; 05-31-12 at 10:20 PM.
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