Four Misconceptions About Taxes and the Deficit

A misguided response to the fiscal cliff could risk a recession while doing little to solve long-term financial problems

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J. Scott Applewhite / AP

In all the negotiations to prevent the fiscal cliff from hurting the economy, potential compromises keep coming apart over the issue of raising income tax rates, especially on high earners. Income taxes stir up strong feelings among voters because of concerns about fairness — and politicians exploit those emotions, whichever party they belong to. As a result, the broader budget discussion keeps getting diverted to focus on tax rates, which actually play only a small role among the causes of current U.S. financial troubles.

In fact, there are really two different budget problems that often get mixed together. One is the current deficit, which totaled more than $1.1 trillion last year, almost double the amount that the U.S. economy can comfortably carry. The other is the long-term accumulation of debt. Even after the U.S. economy fully recovers from the effects of the recessionthe federal deficit is projected to remain too high. As a result, the national debt is on course to keep rising as a percentage of GDP until it reaches dangerous levels.

(MORE: Entitlement Cuts Loom as Obstacle to Fiscal-Cliff Deal)

While everyone agrees that growth of the national debt needs to be slowed over the long term, experts are divided over how much the current deficit should be cut. Some commentators even argue that the short-term deficit should be allowed to continue for another year or so to stimulate the sluggish economy.

The best solution to both these problems would be a grand bargain that limits the growth of debt over the long term while trimming the immediate deficit just enough to show that policy is heading in the right direction. What keeps getting in the way are a bunch of misconceptions, chiefly about tax rates. Here are the four biggest:

The Bush cuts in tax rates caused the deficit. Some economists argue that Bush Administration policies taken as a whole, including costly wars in Iraq and Afghanistan, caused much of the borrowing beyond what the U.S. economy can sustain. More often, though, the blame is focused specifically on the cuts in tax rates. Those rate reductions, however, account for only about a fifth of last year’s $1.1 trillion deficit.

Where did the rest come from? The temporary cut in payroll taxes for Social Security, introduced in 2010 to bolster the economy, reduced revenues by more than $100 billion in 2012. In addition, federal spending as a percentage of GDP has climbed from 20.8% in 2008 to 24.3% last year. Some of that is because of persistently high joblessness that has resulted in more spending on unemployment benefits and less income tax revenue.

(MORE: Can the Estate Tax Solve the Fiscal Cliff?)

Taxes are lower than they used to be. It’s true that the top tax bracket has come down substantially over the past half-century — from 91% when President Kennedy took office, 70% when President Reagan took office and 39.6% when President George W. Bush took office to 35% today. But rates are only one element of income tax policy — the rules for what counts as income and what deductions are allowed are just as important. Mitt Romney enjoyed a low effective tax rate, for instance, because he received much of his income in the form of capital gains.

In the end what really matters is how much revenue the tax system raises. That amount, measured as a percentage of GDP, normally drops during recessions, as it did recently. But once the economy fully recovers, federal revenues are projected to be about the same as they have been for the past half-century.

U.S. income taxes aren’t very progressive. In fact, U.S. income taxes are among the most progressive in the industrialized world. Indeed, 46% of households pay no income tax at all. In many other countries, by contrast, income tax begins at lower income levels than in does in the U.S., on the theory that everyone should pay something.

The high progressivity of the U.S. income tax system is offset, however, by relatively flat taxes for Social Security and Medicare, and by the fact that state and local authorities rely on ways to raise revenue that aren’t progressive at all (e.g., sales tax). While the U.S. tax system may be less progressive overall than it used to be, that isn’t because of federal income tax but because of other types of taxes.

(MORE: Obama Won’t Budge on Top Tax Rates)

Raising tax rates will fix America’s budget problems. Raising tax rates on households with incomes above $250,000 would produce revenues equal to only 4% of the 2012 deficit. Higher taxes on capital gains and dividends, plus higher estate taxes would produce an additional 4%. A few other current provisions that favor the wealthy are equivalent to 2% of the deficit. So all together, higher tax rates for the rich would reduce the deficit by no more than 10%.

The vast bulk of the money that would be raised by the full fiscal-cliff tax hikes, however, would come from the middle class — and that increase could make a big dent in the current deficit. But it wouldn’t permanently solve the long-term budget problem: after five years or so, the relentless growth of health care spending would eat up all the additional revenue.

These misconceptions aren’t just academic questions. Intense debate over tax rates has diverted the discussion from the most important budget issues to factors that are only a small part of the equation. Unfortunately, this is a really bad time to be missing the big picture. The fiscal cliff risks tipping the economy back into recession short term, while not really doing much about long-term problems. Any real solution will have to look out beyond 2013 and focus instead on comprehensive reform of both the overall tax system and long-term entitlements.

69 comments
Stichmo
Stichmo

This article fails to get basic facts about the FY 2012 deficit correct.  Its conclusions are equally problematic.

The article claims that the FY 2012 deficit "totaled more than $1.1 trillion" and that FY 2012 spending was 24.3% of GDP.  In fact, the FY 2012 deficit was less than $1.1 trillion and spending was 22.7% of GDP (http://www.treasury.gov/press-center/press-releases/Pages/tg1734.aspx).

BruceStrong
BruceStrong

Lesson # 1:
* U.S. Tax revenue:       $   2,470,000,000,000
* Fed budget:                 $   3,620,000,000,000
* New debt:                    $   1,150,000,000,000
* National debt:              $ 16,271,000,000,000
* Recent budget cuts:     $        38,500,000,000

Let's now remove 8 zeros and pretend it's a household budget:

* Annual income:               $  24,700.00
* Money spent:                   $  36,200.00
* New debt:                        $  11,500.00
* Outstanding balance:       $161,710.00
* Total budget cuts so far:   $         38.50

Lesson # 2:
Here's another way to look at the Federal Debt Ceiling:

Let's say, You come home from work and find there has been a sewer backup in your neighborhood.... and your home has sewage all the way up to your ceiling.

What do you think you should do ......

Raise the ceiling, or remove the waste?

Maxcene
Maxcene

Did any of you hear the S. Carolina Rep. on Fox?  He said Republicans are not going back to work because Boehner is doing all the work.  The  congress does  not set around working out ways to compromise.  They are playing solitaire and some sort of post office game. That was the reason he gave for not going back to Washington.  It seems tax payers are actually paying the do nothing congress to do nothing.

allan
allan

Standard GOP talking points.

TroyNickerson
TroyNickerson

As a Canadian, I say federal sales tax as part of the solution. It worked for us...


Leftcoastrocky
Leftcoastrocky

The recession caused the deficit, not the other way around.

Leftcoastrocky
Leftcoastrocky

Not raising the debt ceiling or even threatening not to raise it is the worst solution -- putting the full faith and credit of the U.S. on the line -- like holding a gun to our own  head (the head of the U.S. economy) and maybe even pulling the trigger.

mdcrawfish
mdcrawfish

To tell you the truth, I'm not sure what to believe. I've read many articles, each saying something different.I read Krugmand, or listen to other Progressive economists, then I read about the "Laffer Curve" or hear Peter Moreci, and it's a whole different story. I consider myself a Liberal, but I want to know the facts, not just Liberal talking points. I don't want to be like those teabaggers, who believe anything they hear on RW radio. I do find it odd that during the Bush administration, when so many huge expenses were put into place, with no ability to pay for them, there wasn't a peep concerning debt or deficit. No Democrat stopped Bush from raising the debt ceiling. Personally, I just don't want the president to cave in on these bully tactics that the Republicans have inficted upon him. He has plenty of leverage, so use it, and make a good deal that will have  positive economic results. 

BobJan
BobJan

I see it as a two-fold problem. One, Democrats. Two, Republicans. That's it. When I need dental work I go to the Dentist. Car repair, a car mechanic. Hair cut, a barber. Landscaping, a Landscaping company. All these people/business's have credentials. I have yet to see any of the 535 people in Congress with any credentials other than (I accept Lobbying Money) (I kneel at the feet of the Wealthy) (I love free stuff). They have no credentials. When I need a new water heater I don't ask my son who's a writer for advice. Why don't we as a people form committees that are comprised of non party affiliates to come up with suggestions and go from there. Committees formed of present politicians or former politicians is just a "recipe for disaster". All this back and forth about who has the best solution. Answer:None of them.

EugenePatrickDevany
EugenePatrickDevany

The job killing payroll taxes (which generated about $865 billion in FY 2010) are the worst part of our tax code and the main reason it has been so hard to recover from the Great Recession. The second worst part of the tax code is the annual $1.3 trillion in tax expenditures (deductions, credits and other loopholes which reduce revenue). Get rid of both the payroll taxes and all the tax expenditures and the tax code would generate more revenue, jobs would be created and the economy would grow - or not.
The problem lies in the overuse of taxable income as a tax base. Congress passed the 250 or so major tax expenditures because the income rates are so high they were believed to discouraged specific types of investment. The elimination of payroll taxes would necessitate that the basic income tax rates almost double and that makes the elimination or reduction of tax expenditures almost impossible. Indeed congress has been unable to agree on even a 10% reduction. Bold tax reform is hopeless - or not.
Overcoming the congressional stalemate on real tax reform will require a big political win for both the left and the right. Consider a 2% net wealth tax (excluding $15,000 cash and retirement funds) as a revenue neutral replacement for payroll taxes. The left gets millions of new jobs, lower taxes for workers and a stable funding stream for Social Security and Medicare. The next component would sweeten the pie for the right by eliminating capital gains, estate and gift taxes. The scale might still lean left but a flat income tax rate of just 8% would re-balance the deal. This of course would be possible because tax expenditures would not be needed if the income tax rate was only 8%. A business VAT of just 4% (the lowest in the developed world) would enable the corporate tax rate to be reduced to 8% (also without tax incentives).
The tax blend approach is needed because the payroll taxes have overtaxed the income base in a very regressive manner which erodes U.S. labor. The 2-4-8 Tax Blend (described atTaxNetWealth.com) offers an 8% individual and corporate income tax rate as the main prize for those willing to eliminate tax expenditures. Increased efficiency and fairness can also be expected but congress has rarely responded to those qualities.

haklerherr
haklerherr

It seems that this discussion is leaving out defense spending cuts including bases around the world that are scheduled to be closed in the coming years and the ending of the Afghanistan War in 2014.    We still have bases around the war which were necessary during the Cold War, but that war has been over for over two decades.    As far as Medicaid and Medicare go we need to let the Affordable Care Act take affect to see what reductions are made there.   Also the cost of the Prescription Drug Act can be lowered if the government is allowed to negotiate contracts with the drug companies or to put the contracts out for bids.    Health care costs are lowered if everyone is insured and health problems are dealt with at onset rather than waiting to provide health care at more advanced stages of the health problem.   Also medical expenses are high because medical records are not transferred from doctor to doctor.   Patients are forced to switch doctors when the doctor no longer accepts the patients' medical insurance.   Any adult on Medicaid and Medicare knows how hard it is to find a doctor that accepts and Medicaid or Medicare insurance policy.     Also because very few dentist's accept Medicaid for adults and a very limited number of dental procedures are paid for by Medicaid, health problems caused by dental problems are not taken care of before they cause more advanced health problems.   Medicare insurances only cover dental care for x-rays and cleanings which leaving many Medicare patients without proper dental care.    Even the low cost policies which add extra monthly expenses to people on Social Security cover very few dental practices.    What complicates this is that most dentists in the United States have comprehensive care plans that their patients must sign on to allowing the dentist to carry out his full plan much of which is not paid for in adult Medicaid and Medicare Dental plans if the adults can afford extra dental insurance.    Adult Medicaid and Medicare dental programs mostly cover x-rays, cleanings, pulling and filling with the old metal alloy.   In the end pulling and some sort of dentures end up being the elderly's only options.    This is poor dental care.   Adults on Medicaid in many areas have very few choices for dentists because most of the dentists opt out.

One solution to lower would be that all health care providers and facilities should be required to accept Medicaid and Medicare insurances so that the burden of these costs is spread over the whole health care system and not just on the few health care providers and facilities that chose to participate in these programs.    Health care is made more expensive when health care providers and facilities are made to provide emergency health care but then the patient has to seek follow up health care elsewhere.    When records are not transferred many tests are repeated unnecessarily.

Also when the patient's health care records are not passed on from physician to physician than the progression of  the patient's health problems is not being followed so treatments become more expensive than necessary.

 Revenues for Social Security and Medicare can be a increased by taxing all income on a progressive scale to pay for them and extending Medicaid and Medicare to all residents in the United States so that employers do not have to worry about providing health care insurance for their employees and there is still a healthy workforce in the United States.     This would also protect Public Health and lessen the number of pandemics the Nation is forced to deal with.

Very few Americans can choose their health care providers and health care facilities unless they can afford to pay for expensive health care policies that are accepted by most healthcare providers and healthcare facilities.    Employers are not even able to pay for such policies for their employees.    This dispels the myth that government involvement in providing health care will prevent people form choosing their healthcare providers.     Also today the healthcare that people receive is limited by the healthcare that is provided by their insurance coverage.     This dispels the myth that government involvement will result in death panels.    The insurance companies already have death panels when they cut off payment for your health care or when they raise the cost of their policies so high that you can't afford to pay for them any more.



DavidClaudeWarlick
DavidClaudeWarlick

This article is not technically correct.  It recommends that the best solution would be a grand bargain that limits the growth of debt.  Good golly, we have that, in something called the debt ceiling.  The current debt ceiling will be hit about March 2013.  If the 535 members of Congress do not raise the current debt ceiling, we will have our grand bargain.

BhujangaraoInaganti
BhujangaraoInaganti

We need the money to be collected from all sources even in tidbits but as stated in the article a more sobre analysis has to be carried out. Ultimately the situation will stabilise when the economy goes into full growth mode. The realistic approach is to work towards that goal by stimulating the sectors where growth can occur and invest in them.Simultaneously all fraud and waste should be weeded out and inefficiencies should be removed as a continuing mission in all Govt. programmes.

worleyeoe
worleyeoe

Very good article. I know that I read from an IRS publication that revenues at the height of the collapse (circa 2009) had dropped in excess of $500B annually, which is a huge chunk of our deficits. Moreover, I've read that Bush's tax cuts were only for $1.35T over 10 years, so that averages out to be less than the $200B claimed. Sources please.

But the worst part of all this is that Obama is not going to use his tax on $250K earners to pay down the debt. No, it's earmarked for paying for PPACA, so in one fell swoop, he has pushed through legislation that already has raised or created 21 new taxes. Now, when you hear about tax reform, the first things people start talking about are mortgage deductions and employer paid healthcare premiums, both of which are heavily part of the middle class tax structure.

Finally, I would agree that our tax structure is entirely too progressive. Two points, there should be no zero tax liability under any circumstances if you earned money. Next, get rid of the Earned Income Credit. It's abhorrent that people get back money they didn't pay into the system. It's these types of loopholes that are drowning us in deficits.

Next, write a nice article on four misconceptions about federal spending.

tom.litton
tom.litton

@BruceStrong I'm sorry, but i think that's a terrible analogy.  First, and this is neither here nor there, you can't really get sewage to back up all the way to your ceiling.  If nothing else, it would break the windows and fall out.  Also, you wouldn't clean it up.  You would claim the insurance money and move out.


Also, i'm not sure what you mean by remove the waste?  Are you saying that we just refuse to pay people back, tell everyone holding a US bond they are never going to get any money for it?

tom.litton
tom.litton

@Leftcoastrocky Recessions cause deficits, true.  This is why we need to pay down some of the debt before the next recession.  So that we can run deficit's during them.

NorEastern
NorEastern

@Leftcoastrocky So true. Well except for the fact that Bush and his tax cuts and his 2 wars really ramped everything up. Oh, and wasn't there that lack of financial regulation thing-a-ma-bob?

Heian
Heian

@mdcrawfish The difference was, Bush was running high on the "war president" momentum, ringing the terrorism bell at every opportunity. It used to be, if you didn't support Bush policies, you weren't a patriot. A lot of political momentum was gained in the bumbling failures that resulted in the terrorist attacks in 2001.

There are no intellectual requirements to hold political office. Which is a real problem when they're the ones putting votes forward on major policies. A painful example, MO political figure and his absurd "legitimate rape" comments; this is a person who INFLUENCED POLICY. I cringe thinking of how antiquated the social views of a majority of Congress are.

NorEastern
NorEastern

@mdcrawfish Not raising the debt ceiling leads to bad things like the credit agencies lowering US Government bond ratings. To hold the government hostage by restricting the ability to pay their bills in a timely fashion is a bit like playing Russian roulette. Stupid, but that won't keep the House Republicans from playing. 

The Laffer Curve was discredited long ago. That has not kept political hacks and the MSM from referencing it frequently.

NorEastern
NorEastern

@BobJan That just means that the electorate hasn't had the guts to put them into office. I have great hopes for Elizabeth Warren from Massachusetts. She is someone who specializes in the financial and related sectors and it seems like every pro-business lobby has railed against her. We will see.

MoisesIssi
MoisesIssi

@BobJan In theory that would be a great idea. The problem is that Democrats would pick an expert leaning democrat while Republicans would do the same. Let me just add here that all that this article is being describing is what Republicans wanted to do all along: Lower Entitlements and Not raise taxes on the pretext that they are designed to lower the deficit. Democrats don't like it because every time they extend an Entitlement check they get a new loyal voter.

BobJan
BobJan

@haklerherr you're using common sense and logic to define problems and solutions. Congress doesn't want to hear that. They just want to continue to be stubborn and obstinate and blame each other. Watching Congress act is like viewing "One flew over the cuckoos nest".

marshall_wesley
marshall_wesley

@DavidClaudeWarlick Congress has never failed to raise the debt ceiling...ever. It's been voted on many, many times since it was legislatively put to a vote around 1917. While it is nice - in theory -to have a debt ceiling limit. It would be nice if Congress would say no just every once in awhile.

tom.litton
tom.litton

@BhujangaraoInaganti I agree the government should be as efficient and effective as possible. I think you would have a very hard time finding people that disagree with that.  

The problem, of course, is in the implementation.  ~$2.5 budget makes for a huge bureaucracy that is notoriously hard to manage.  Even the corporate world isn't that efficient when it gets large.  

tom.litton
tom.litton

@worleyeoe The thing with taxing poor people is that you will effectively raise the poverty level.  Which means you will have to give those people more money to live, or they won't take those jobs (why would someone take a job if they still can't provide for their family?).  It seems taking money away and then giving it back isn't very inefficient use of resources.


I think a better solution would be to raise their income so that they can afford to pay more taxes.  I have yet to see anyone come up with a credible plan to do that.

Richard_Parker
Richard_Parker

@worleyeoe If you want to eliminate the EIT, then you will need to raise minimum wage. After all the expansion of the EIT income ceiling under Ford was in response to Republican controlled House no wanting to raise minimum wage for fear it would harm job creators (sound familiar?) The EIT expansion was their solution to what they perceived as a problem. So if you want to go back to pre-1975 tax code then you need to address the reason for the expansion of EIT. But I would agree with your call to eliminate  incentives that reduce tax liabilities below zero. There should not be a rebate program in the tax code. I also believe fervently that capital gains and dividends should be treated as regular income and taxed accordingly. In addition, there is no good reason to have a ceiling on the amount of income subject to SS taxes.

Stichmo
Stichmo

@tom.litton @Leftcoastrocky - The question is WHEN to start significant deficit reduction.  

From my review of history, we set post WW II records for spending as a % of GDP in FY's 1981, 1982 and 1983, not stopping until ALL of the 2.7 million private sector jobs lost in the downturn of 1981-82 had been recovered.  That fiscal stimulus helped us to a strong recovery.

By contrast, we cut the deficit during the Great Depression in 1937 and 1938 before jobs had fully recovered.  The result was a double dip recession.

As a result of the "Great Recession" of 12/07-6/09 we lost 8.8 million private sector jobs.  We have recovered 5.1 million of those jobs through November 2012, enough to recover from any recession since the Great Depression except this one. At current job growth rates it will take about another two years to recover the remaining 3.7 million private sector jobs.  Therefore, we should be looking to continue fiscal and monetary stimulus in FY's 2013 and 2014 and start phasing in substantial deficit reduction in FY 2015.

Trying to substantially cut the deficit prior to FY 2015 risks a double dip recession.  Continuing to run bigger deficits after we have fully recovered risks inflation and/or another asset bubble.

NorEastern
NorEastern

@tom.litton @Leftcoastrocky True, but aren't we just getting out of a recession? If growth picks up we should return to the last years of Clinton's presidency and run surpluses.

AndrewK777
AndrewK777

@NorEastern @mdcrawfish Even a junior high student can see that the Laffer curve is a joke. He assumes 0 revenue at a both ends (these assumptions are bogus) and then magicaly draws a bell shaped curve between them. If, for the sake of arguement, we allow his bogus assumptions how does it make any mathematical sense for two points to determine a curve? More importantly it states that there is a sweet spot for maximum revenue. It does not say that lowering taxes increases revenue in all cases. It is a broken theory that is being applied incorrectly by people who incapable of basic math.

BruceStrong
BruceStrong

@NorEastern @BobJan What on earth is Warren going to do? Just got a mortgage, and the paperwork was OVER 100 pages... She going to make it 200, get real...

BobJan
BobJan

@MoisesIssi @BobJan are you trying to tell me that the 2 wars, 2 tax cuts and the unfunded drug plan had nothing to do with the deficit. I get an entitlement check every month in the form of SS and military disability. Are you saying that the money I paid into SS for 48 years and my time in the military, wounded in combat, I should just give it all up so Romney can pay lower taxes. Surely you jest. When the two tax cuts came into being it was based on the premise that we could run surpluses in the gov't tax system as under Clinton. Then when the 2 wars started and we created the Dept. of Homeland Security (Republicans had full charge then) and money was being spent like a drunken sailor, you're trying to tell me that the Republicans were fiscally responsible. Are you trying to make me "die of laughter"? I wouldn't let any Republican in Congress cut my lawn for fear they'd ruin it. Same goes for the Democrats. And what "Republicans wanted to do all along" is screw the American people.

tom.litton
tom.litton

@MoisesIssi @BobJan To be fair, every time Republican's lower someone's taxes, they get a new loyal voter too.  

It isn't as if one side wants to get the job done, and the other side is using the issue to chase votes.  They both chase votes.  It's just that Democrats chase votes from people that value entitlements and Republicans chase votes from the side that values tax cuts.

tom.litton
tom.litton

@BobJan @haklerherr I disagree.  Congress just wants to get re-elected, and it's much easier to get elected blaming others then it is to raise people's taxes and cut spending people depend on.


Organizations like the heritage foundation and move on.org are throwing fuel onto the fire by promising to defeat congressmen in the primaries before the moderates get a chance to vote. 

I should point out that the tea party backed organizations (like the Heritage Foundation) seem to be MUCH better organized and financed then the progressive backed organizations (like moveon.org).  And they seem to be in favor of sacrificing everything and everyone to protect taxes.  It makes me curious who is founding them...

tom.litton
tom.litton

@marshall_wesley @DavidClaudeWarlick Are you suggesting that the US government should, every once in a while, refuse to pay for the things it has bought?  Remember we aren't talking about reducing spending.  We are talking about not paying the bill when it comes due.

BhujangaraoInaganti
BhujangaraoInaganti

@tom.litton @BhujangaraoInaganti I hope the Govt we put in place during the elections will do a proper job and that is the best we can hope for for another four years. We hope for no bungling beurocracy and all the lawmakers will cooperate and put good policies in place.

worleyeoe
worleyeoe

@tom.litton @worleyeoe Oh! The simple fact is that so they stop becoming a leach, to be a productive citizen, to pay taxes even if it's $100, to set an example for the children. The list goes on and on. Honestly, you should be embarrassed for asking your question, at least without a little more qualification.

worleyeoe
worleyeoe

@tom.litton @worleyeoe As I stated above, I could agree with an increase in the minimum wage that's also indexed to inflation. But, I'm not saying raise it to $15 an hour. Even the poor can find ways to live more within their means. It might mean no cable TV and no cell phone, but again everyone has to adjust their lifestyle. The EIC and the child tax credits should go. Stop rewarding people for not working and having children. These are very antiquated tax loopholes that do not promote people working towards self-efficacy.

worleyeoe
worleyeoe

@Richard_Parker @worleyeoe Thanks for the history lesson. My simple point is that to close a $1,300,000,000,000 annual deficit, then EVERYTHING has to be on the table and EVERYONE has to pay something. To eliminate the EIC, I certainly could agree to an increase in the minimum wage that's index to inflation. I want the president that has the political courage to look every American in the face and say, "EVERYONE HAS TO GIVE UP SOMETHING".

tom.litton
tom.litton

@NorEastern @tom.litton @Leftcoastrocky Defense has grown a lot over the last decade.  The interest on the debt has grown a lot too (and a recovery might push those costs higher).  

Plus there is the problem with medicare.  Stagnating wages puts additional pressure on programs that help the poor.  The infrastructure isn't as sound as it once was and newer technologies puts pressure on it (ie high speed rail, broadband internet, etc).  

Basically what i'm saying is that it's always about going forward.  You can never go backwards (Not that you can't draw lessons from the past).

BobJan
BobJan

@BruceStrong @BobJan @MoisesIssi I do have a grip. I see how the political realm reality is DC one way and when they talk is another way. They talk the talk but don't walk it. They are beholden only to their donors. The old saying "money talks" is so true. Those people in Congress care less about you and the sooner you realize that the sooner you'll change your tune. It's not paranoia it's the truth. When is the last time your representative ate lunch with you? When is the last time your rep called you up and asked how you felt about a certain issue? NEVER! Wall Street still walks the halls of Congress with their "heads held high" per Senator elect Elizabeth Warren. DC is more corrupt than any commie nation of leaders. Even China has come out recently about corruption in high gov't places. In the US it's still done on a regular basis. so, "get a grip"!

worleyeoe
worleyeoe

@Heian @worleyeoe Of course, I know what it means, the difference is that you're looking at different facts than I am. Numbers and opinions can be spun many different ways.

Heian
Heian

@worleyeoe  

I don't think you know what the word "fact" means, because you certainly aren't using it correctly.  I think you mean "narrow-minded and ignorant opinion" in place of "fact". Everyone who works does pay something, but you're narrowing the scope of your "facts" specifically and exclusively to income tax.

tom.litton
tom.litton

@worleyeoe Oh! The simple fact is that so they stop caring about those things if they can't feed, clothe, and shelter their children. The list goes on and on. Honestly, you should be embarrassed for answering the question, at least without a little more qualification.

worleyeoe
worleyeoe

@Heian @nanajan2 @worleyeoe Let me guess, though, you get money back from EIC, which is why you're ranting and raving so much. Or at least you have friends that do. Well, the EIC needs to be eliminate over about a four year period. And there are tons of other deductions and loopholes that need to be closed. Just because you "scrap by" doesn't mean the rich should have to pay for your healthcare.

worleyeoe
worleyeoe

@Heian @nanajan2 @worleyeoe Where did I say everyone that's poor is lazy? OMG! You are a typical, retarded liberal that always shoots their mouth off and overblowing what's been said.

Heian
Heian

@nanajan2 @tom.litton @Heian @worleyeoe  

"Just look around you" = no evidence, no supporting argument, no facts, no context. For somebody complaining about "lazy" people, you sure can't be bothered to quantify the ridiculous things you say.

Heian
Heian

@nanajan2 @Heian @worleyeoe  

 The point that you think everyone who is poor is also lazy? Or that the big financial problems of the country are somehow the fault of the people with the fewest finances?

Heian
Heian

@nanajan2 @Heian @worleyeoe  

I work full-time and don't have a lavish lifestyle or extra expenses. I also don't take money from any government programs and barely scrape by some months. You are completely clueless.

nanajan2
nanajan2

@Heian @worleyeoe I have been there and done that.  However, the new game today is to get the government to take care of your needs so you can maintain a lifestyle you cannot afford on your own.  This has made for a lazy society of which is the very basis of our current economic crisis.  The current occupant of the White House has nothing more than a political agenda which is making the crisis worse.  This article is well written and should be given utmost attention by Congress and the President. 

Heian
Heian

@worleyeoe  

 This demonstrates that you have never had to balance a budget at a low income level. Just the same condescending idea that people who struggle financially are flagrantly throwing money around instead of being prudent. Your ignorance is showing.

tom.litton
tom.litton

@worleyeoe @tom.litton I agree that they shouldn't get cable (cell phones i don't agree, but only because they are cheaper than home phones now days).  What they should be able to afford is:

Healthy food

Heating / electricity

Health Care

Heian
Heian

@worleyeoe  

If you want to axe the EIC, then you should be all in favor of carving the tax cuts for high-earners - these same taxes that have been divebombing over the last half-century. Not to mention the effective tax-dodges of capital gains.