Geyser up...

[Yoda]

Aug 14, 2010 17:13:00 GMT -8 The Great Aztec Joe said:

I favor a fifty percent flat tax on all income in excess of $30,000. That is fair and just and balanced and right. 75 percent seems a bit too much, though I can understand where you are coming from.

I started this as a response by The Great Aztec Joe to a post on another thread. But as it developed it kind of went a different direction, into one that I thought deserved its own thread...

===================================

The problem is Joe, you would send us straight into a worldwide depression.

The problem that we have right now is that people are hoarding cash. Businesses -- or at least big ones -- can easily afford to expand and hire workers (they don't need tax cuts to do so -- they already have the liquidity). But they are not willing to start hiring until such time as the public shows that it is willing to spend. Why produce products when the public won't buy them? And we are not willing to start spending until we have paid down debt and until we feel a little more confident in the stability of our income.

Your "50% tax on everything over $30K solution, solves our reluctance to spend problem by taking away what we would have used to spend if we had decided it was safe to do so. Which is to say, you hugely exacerbate the problem rather than solve it.

If I were God, I wouldn't extend any of the tax cuts -- not now anyway. Rather, I would say make the first $100,000 of income, tax free -- for the remainder of 2010 and for 2011 only. That would speed up debt reduction and would spur domestic spending, both in a big way. High income people would earn a ton more money as they would sell a ton more product -- and they wouldn't mind the higher tax rate as the real issue isn't the tax rate nearly so much as it is the net income after taxes.

Further, it would spur job creation in a way that tax cuts couldn't begin to imagine.

And I don't think that it would necessarily cost us any net tax revenue either. With incomes soaring for the richest Americans, hiring soaring, and tax rates at the Clinton level, it might well be a net tax gainer.

The concept of cutting taxes, principally for the rich, has some merit when the problem is a lack of investment. The problem here, however, isn't a lack of investment -- it's a lack of domestic spending. And 70% of our economy is dependent on domestic spending. In that situation, you don't adopt a tax policy that spurs investment -- you adopt a tax policy that spurs domestic spending -- spending by the masses, meaning one that targets the non-rich.

It's sort of a reverse Laffer curve. Laffer works fine, to a point anyway, when you are looking to spur investment -- but we should be looking to spur spending. This doesn't call for trickle down, this calls for geyser up. In essence, it would fast forward through the slow process of debt reduction and confidence rebuilding and it would end the recession far faster than tax cuts or patience ever would.

And whichever party owned the proposal would see their November prospects go through the roof.

Yoda out...

[davdesid]

Damned right people are hoarding cash. And anything else they deem valuable.

Too much uncertainty ahead with this bunch. Did you know all businesses, large and small, are going to have to generate a 1099 for any and all transactions valued at over six-hundred dollars in a year? Yep, part of the Health Care Bill that her Nibs said we'd have to wait to find out about when it passed.

Making the first $100K of income "tax-free" could free up some spending, but let's get serious. That will happen when pigs fly.

Besides, the gummint could outright confiscate everything over that amount and I doubt it would come anywhere close to covering the profligate spending going on with this bunch.

[Yoda]

Happy to have given you the opportunity to rant about some of your favorite topics -- not that they are particularly related to the policy notion that I was attempting to address.

Just for giggles, however, would you care to give me a link to that 1099 claim? Not to an extremist blogger who claims it but to the actual language. I own a business, you see, and I have hundreds of transactions that exceed $600. So I'll need to figure out how many additional accountants I'm going to have to hire.

You see, I'm getting a feel for your usual sources and I kind of doubt that I will need to generate even 1 such 1099. But if I'm wrong, then I'd sure like to know it earlier, rather than later, when all the available accountants have been hired.

Yoda out...

[davdesid]

Aug 15, 2010 16:42:29 GMT -8 Yoda said:

Happy to have given you the opportunity to rant about some of your favorite topics -- not that they are particularly related to the policy notion that I was attempting to address.

Just for giggles, however, would you care to give me a link to that 1099 claim? Not to an extremist blogger who claims it but to the actual language. I own a business, you see, and I have hundreds of transactions that exceed $600. So I'll need to figure out how many additional accountants I'm going to have to hire.

You see, I'm getting a feel for your usual sources and I kind of doubt that I will need to generate even 1 such 1099. But if I'm wrong, then I'd sure like to know it earlier, rather than later, when all the available accountants have been hired.

Yoda out...

Rant? You really are a piece of work, aren't you?

Giggle away...

thehill.com/blogs/on-the-money/domestic-taxes/109243-senators-seek-to-repeal-1099-rule-in-healthcare-law


EXTREEEEEEMIST source, right?

[davdesid]

Oh, here's another cite from a EXTREEEEEEEEEEEEEMIST blogger:

www.numismaticnews.net/article/600_sale_Tax_form/

[Yoda]

I see. So you are in favor of tax fraud -- or at least of not collecting the $19 billion in unreported income that this legislative effort is designed to collect.

That was a joke; I'm sure you are not in favor of tax fraud.

From what I've read of your links and from further reading, it appears that this legislation extends the current reporting requirement of services purchased (except from corporations) to goods and services and now includes corporations. The benefit is supposed to be the generation of an additional $19 billion in tax revenue from income currently under reported or not reported at all.

First off, from my standpoint, I might have to issue as many as 500 such 1099s -- although I have a sneaking suspicion that we already issue them for perhaps 450 of them. I have a CFO so I'm not certain but I think we do -- although I'm not sure why as most of our clients are corporations. There may be a different requirement that we are responding to or I may be all wet.

In any event, we can run reports to generate the amounts and that won't take but a few minutes. Issuing those 1099s would take a little time if we have to do it manually but I suspect that there will be some software -- or more likely freeware -- that will convert an excel file to a series of 1099s so the whole thing will probably take us a half day or less. There probably already is. I don't think that is a huge pain for a $19 billion gain.

I'm sure that there will be some people who will have to do it manually but the greater the number of transactions, the greater the chance that the whole thing will be automated. It wouldn't take materially longer to generate 5,000 1099's than 500. The biggest cost is probably the postage.

As for the extremism, I have no idea how extreme or not your first link is -- and I don't care to poke around enough to form an opinion. Your second, however, would seem to be directed to people who trade a lot of cash or cash equivalents and who might like to hide their transactions.

Yoda out...

[aztecwin]

Aug 15, 2010 18:20:04 GMT -8 Yoda said:

I see. So you are in favor of tax fraud -- or at least of not collecting the $19 billion in unreported income that this legislative effort is designed to collect.

That was a joke; I'm sure you are not in favor of tax fraud.

From what I've read of your links and from further reading, it appears that this legislation extends the current reporting requirement of services purchased (except from corporations) to goods and services and now includes corporations. The benefit is supposed to be the generation of an additional $19 billion in tax revenue from income currently under reported or not reported at all.

First off, from my standpoint, I might have to issue as many as 500 such 1099s -- although I have a sneaking suspicion that we already issue them for perhaps 450 of them. I have a CFO so I'm not certain but I think we do -- although I'm not sure why as most of our clients are corporations. There may be a different requirement that we are responding to or I may be all wet.

In any event, we can run reports to generate the amounts and that won't take but a few minutes. Issuing those 1099s would take a little time if we have to do it manually but I suspect that there will be some software -- or more likely freeware -- that will convert an excel file to a series of 1099s so the whole thing will probably take us a half day or less. There probably already is. I don't think that is a huge pain for a $19 billion gain.

I'm sure that there will be some people who will have to do it manually but the greater the number of transactions, the greater the chance that the whole thing will be automated. It wouldn't take materially longer to generate 5,000 1099's than 500. The biggest cost is probably the postage.

As for the extremism, I have no idea how extreme or not your first link is -- and I don't care to poke around enough to form an opinion. Your second, however, would seem to be directed to people who trade a lot of cash or cash equivalents and who might like to hide their transactions.

Yoda out...

I think you are pretty close to correct in all parts of your post. I would have taken the time to look in the link to the Hill. You might be surprised at how at least the comments line up with what you say. I still see it as an unneeded burden on smaller business since you should be required to keep your records in the case of an audit. Seems like an excuse to add more IRS employees to police this new requirement. What level of confidence do you have in the estimate of the tax impact?

[Yoda]

Aug 15, 2010 19:16:32 GMT -8 aztecwin said:

Aug 15, 2010 18:20:04 GMT -8 Yoda said:

I see. So you are in favor of tax fraud -- or at least of not collecting the $19 billion in unreported income that this legislative effort is designed to collect.

That was a joke; I'm sure you are not in favor of tax fraud.

From what I've read of your links and from further reading, it appears that this legislation extends the current reporting requirement of services purchased (except from corporations) to goods and services and now includes corporations. The benefit is supposed to be the generation of an additional $19 billion in tax revenue from income currently under reported or not reported at all.

First off, from my standpoint, I might have to issue as many as 500 such 1099s -- although I have a sneaking suspicion that we already issue them for perhaps 450 of them. I have a CFO so I'm not certain but I think we do -- although I'm not sure why as most of our clients are corporations. There may be a different requirement that we are responding to or I may be all wet.

In any event, we can run reports to generate the amounts and that won't take but a few minutes. Issuing those 1099s would take a little time if we have to do it manually but I suspect that there will be some software -- or more likely freeware -- that will convert an excel file to a series of 1099s so the whole thing will probably take us a half day or less. There probably already is. I don't think that is a huge pain for a $19 billion gain.

I'm sure that there will be some people who will have to do it manually but the greater the number of transactions, the greater the chance that the whole thing will be automated. It wouldn't take materially longer to generate 5,000 1099's than 500. The biggest cost is probably the postage.

As for the extremism, I have no idea how extreme or not your first link is -- and I don't care to poke around enough to form an opinion. Your second, however, would seem to be directed to people who trade a lot of cash or cash equivalents and who might like to hide their transactions.

Yoda out...

I think you are pretty close to correct in all parts of your post. I would have taken the time to look in the link to the Hill. You might be surprised at how at least the comments line up with what you say. I still see it as an unneeded burden on smaller business since you should be required to keep your records in the case of an audit. Seems like an excuse to add more IRS employees to police this new requirement. What level of confidence do you have in the estimate of the tax impact?

I have no confidence in the estimate. Don't even know where it came from -- although nobody seems to be disputing it.

As for records, you wouldn't be required to store the underlying records any longer than you are required to store them now. Tax info is kept for what -- 7 years? Most such records are stored digitally -- as the 1099's would be. The storage burden isn't nearly what it once was. I just don't see the big burden on business.

In my industry, pretty much everything is scanned and shredded already. If it wasn't for fast food packaging, we wouldn't even have trash cans.

I'm sure that the IRS would need some employees -- and a big honking piece of software to total and correlate 1099's to the recipients reported 1099 income. But you sure as hell wouldn't need $19 billion worth of new employees, etc.

This thread wasn't supposed to be about 1099's, however, but about my little tax cut idea. And nobody has really commented on that. I've never heard the basic idea from any corner of the political spectrum and I wouldn't want people thinking that you right wingers can't come up with an opinion that hasn't first been vetted by the far right media. Surely you have opinions before your media tells you what they are, don't you (he taunted -- tongue in cheek).

Yoda out...

[aztecwin]

Aug 15, 2010 20:46:13 GMT -8 Yoda said:

Aug 15, 2010 19:16:32 GMT -8 aztecwin said:

I think you are pretty close to correct in all parts of your post. I would have taken the time to look in the link to the Hill. You might be surprised at how at least the comments line up with what you say. I still see it as an unneeded burden on smaller business since you should be required to keep your records in the case of an audit. Seems like an excuse to add more IRS employees to police this new requirement. What level of confidence do you have in the estimate of the tax impact?

I have no confidence in the estimate. Don't even know where it came from -- although nobody seems to be disputing it.

As for records, you wouldn't be required to store the underlying records any longer than you are required to store them now. Tax info is kept for what -- 7 years? Most such records are stored digitally -- as the 1099's would be. The storage burden isn't nearly what it once was. I just don't see the big burden on business.

In my industry, pretty much everything is scanned and shredded already. If it wasn't for fast food packaging, we wouldn't even have trash cans.

I'm sure that the IRS would need some employees -- and a big honking piece of software to total and correlate 1099's to the recipients reported 1099 income. But you sure as hell wouldn't need $19 billion worth of new employees, etc.

This thread wasn't supposed to be about 1099's, however, but about my little tax cut idea. And nobody has really commented on that. I've never heard the basic idea from any corner of the political spectrum and I wouldn't want people thinking that you right wingers can't come up with an opinion that hasn't first been vetted by the far right media. Surely you have opinions before your media tells you what they are, don't you (he taunted -- tongue in cheek).

Yoda out...

Your views or offering for discussion became lost in the shuffle. You were answering AztecJoe and we kind of let that thought go. It might work that way, but I would still be in the mode of paying down any debt before spending. I would squeeze every ounce of productivity out of my current work force before hiring new people and I would be waiting to see some stability in government policy. Your idea might work, but just like Keyes, you need widespread buy in. Don't think that is in the works with this present Administration in office. It still might be worth a try after the mid-terms.

[davdesid]

>>As for the extremism, I have no idea how extreme or not your first link is -- and I don't care to poke around enough to form an opinion. Your second, however, would seem to be directed to people who trade a lot of cash or cash equivalents and who might like to hide their transactions.<<

So, you're not familiar with "The Hill", so you won't brand them with the "extremist" shibboleth, but Numismatic News caters to people (coin dealers/collectors) who likely are/or at least could be tax cheats. And therefore are probably "extremists". Is that about right?

I don't know why I bother, since you "don't care to poke around" re "The Hill", but is this an "extremist" source?

www.businessweek.com/smallbiz/content/may2010/sb20100526_855178.htm

Or how about this? (okay, maybe... but certainly not 'right-wing'. Should be a source right down your alley):

open.salon.com/blog/richard_rider/2010/05/24/health_care_bill_includes_form_1099_frankenstein

[aztecwin]

Businessweek says it is to get $2 billion, not 19 billion. Now if that is a closer estimate, it i really not worth the trouble.

[Yoda]

Aug 16, 2010 14:22:51 GMT -8 davdesid said:

>>As for the extremism, I have no idea how extreme or not your first link is -- and I don't care to poke around enough to form an opinion. Your second, however, would seem to be directed to people who trade a lot of cash or cash equivalents and who might like to hide their transactions.<<

So, you're not familiar with "The Hill", so you won't brand them with the "extremist" shibboleth, but Numismatic News caters to people (coin dealers/collectors) who likely are/or at least could be tax cheats. And therefore are probably "extremists". Is that about right?

I don't know why I bother, since you "don't care to poke around" re "The Hill", but is this an "extremist" source?

www.businessweek.com/smallbiz/content/may2010/sb20100526_855178.htm

Or how about this? (okay, maybe... but certainly not 'right-wing'. Should be a source right down your alley):

open.salon.com/blog/richard_rider/2010/05/24/health_care_bill_includes_form_1099_frankenstein

That "extremist" thing really got your goat, didn't it? You've been carrying that one around and growling about it quite a bit.

Okay, for the record, I do not believe that Businessweek is an extremist publication. But that said, why is it that those who so hate the mainstream media for its lack of objectivity devour the right wing media's lack of objectivity like it was water to a man dying of thirst?

Take a look at that Businessweek article. This is not exactly a "just the facts" kind of article that you folks demand of articles that you don't regurgitate as your proofs. "Nightmare"... "buried in the bill"... "bear the brunt"... We're not even to the article yet -- that's just the title and subtitle.

It seems strange to me that those who are so quick to point out a lack of objectivity that they don't agree with will seduce and bed the same lack of objectivity when it comes from someone that they agree with. That left does it too.

Anyway, that was a bit of an aside. If it makes you feel any better, I'm not exactly enthusiastic about this bill. It won't cause many people a lot of pain individually, but in the aggregate I'm not sure it's worth it -- particularly if it is for only $2 billion.

I know you think I'm left wing but I really am radically moderate and anti-partisan.

Yoda out...

[davdesid]

Aug 16, 2010 15:29:08 GMT -8 Yoda said:

Aug 16, 2010 14:22:51 GMT -8 davdesid said:

>>As for the extremism, I have no idea how extreme or not your first link is -- and I don't care to poke around enough to form an opinion. Your second, however, would seem to be directed to people who trade a lot of cash or cash equivalents and who might like to hide their transactions.<<

So, you're not familiar with "The Hill", so you won't brand them with the "extremist" shibboleth, but Numismatic News caters to people (coin dealers/collectors) who likely are/or at least could be tax cheats. And therefore are probably "extremists". Is that about right?

I don't know why I bother, since you "don't care to poke around" re "The Hill", but is this an "extremist" source?

www.businessweek.com/smallbiz/content/may2010/sb20100526_855178.htm

Or how about this? (okay, maybe... but certainly not 'right-wing'. Should be a source right down your alley):

open.salon.com/blog/richard_rider/2010/05/24/health_care_bill_includes_form_1099_frankenstein

That "extremist" thing really got your goat, didn't it? You've been carrying that one around and growling about it quite a bit.

Okay, for the record, I do not believe that Businessweek is an extremist publication. But that said, why is it that those who so hate the mainstream media for its lack of objectivity devour the right wing media's lack of objectivity like it was water to a man dying of thirst?

Take a look at that Businessweek article. This is not exactly a "just the facts" kind of article that you folks demand of articles that you don't regurgitate as your proofs. "Nightmare"... "buried in the bill"... "bear the brunt"... We're not even to the article yet -- that's just the title and subtitle.

It seems strange to me that those who are so quick to point out a lack of objectivity that they don't agree with will seduce and bed the same lack of objectivity when it comes from someone that they agree with. That left does it too.

Anyway, that was a bit of an aside. If it makes you feel any better, I'm not exactly enthusiastic about this bill. It won't cause many people a lot of pain individually, but in the aggregate I'm not sure it's worth it -- particularly if it is for only $2 billion.

I know you think I'm left wing but I really am radically moderate and anti-partisan.

Yoda out...

Okay, fair enough...

...but getting back to your tax idea...

...you said, "This thread wasn't supposed to be about 1099's, however, but about my little tax cut idea. And nobody has really commented on that."

...you suggested, "If I were God, I wouldn't extend any of the tax cuts -- not now anyway. Rather, I would say make the first $100,000 of income, tax free -- for the remainder of 2010 and for 2011 only. That would speed up debt reduction and would spur domestic spending, both in a big way. High income people would earn a ton more money as they would sell a ton more product -- and they wouldn't mind the higher tax rate as the real issue isn't the tax rate nearly so much as it is the net income after taxes."


First of all, we both know that will never happen. And if it did, how many folks making less than 100K would spend themselves into unmanageable debt situations which will smack them hard when (after 2011, as you suggest) they return to fairly sobering tax obligations. We're going to see the results of that kind of policy at the end of this year.

IMHO, if there is anything at all I agree with our Dear Leader about, it would be "everyone should have skin in the game".

So, no. I don't think anyone should be exempt from the franchise.

No offense... please understand. JMHO.

[The Great Aztec Joe]

Now that you guys have had your own opportunity to derail the thread, Let me say this about the original topic.

Yoda, you do not see the world through my socialist rose tinted glasses. I see the government as the source of economic expansion. Private enterprise is failing miserably and can not keep up with Communist China's growth rate. In fact, China's growth rate is roughly equivalent to our decline rate. We gotta do somthin' 'bout that.

The government needs to create jobs with all of the revenue that will be flowing in.

As has to be obvious to you, we are falling deeper and deeper into a massive Depression that I predicted on one of the old Aztec Boards about six - seven years ago when I first mentioned the massive inflation in house prices(I wanted to sell my house to the Mormon Church and move to where farmland would be cheap and I could build Fortified Farmsteads to sell to the City Slickers who could be frightened into tremendous fear of the unknown if the US fell into a Massive Depression.)

What will we do to climb out of this Depression???