Message from discussion OT - PRESIDENT. BARACK. OBAMA
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From: "Norman Schwartz" <n...@optonline.net>
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Subject: Re: OT - PRESIDENT. BARACK. OBAMA
Date: Tue, 13 Nov 2012 12:29:46 -0500
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Mark S wrote:
> On Monday, November 12, 2012 10:01:59 AM UTC-8, Bob Harper wrote:
>> I wonder about the 70% figure, but if one adds up the top federal
>> (currently 35% on income above $388,350, plus SS (currently 10.4% on
>> first ca. 115K) and Medicare (2.9% on everything), then add state
>> tax for those not wise enough to live in a state without one. these
>> widely, but an average of 6% seems about right, typically on all but
>> fairly low level of income (i.e., states typically hit their top rate
>> much sooner than the feds), sales tax on whatever one has spent on
>> taxable goods--let's say 3% of income, real estate taxes, personal
>> property taxes...it's not hard for a high income earner to reach a
>> tax burden of well over 50%. So maybe 70% is a stretch, but not by as
>> much as Mark seems to think.
> All of that is pretty irrelevant, Bob, because everybody pays all of
> those other taxes you've enumerated.
> I'd point out that everybody pays FICA taxes on the first $106,800 of
> income earned. That's a much larger burden on lower-income earners,
> which is most Americans. They're paying FICA on 100% of their income.
> The guy making $388k is paying FICA on only the first 27% of his
> income. The guy making $1.6-million is paying FICA on only the first
> 10% of his income. Why the cap on FICA when it effects so few people?
> Looks like a giveaway to the rich.
> Also, you fail to account at all for deductions that people take or
> can't take. A low-wage earner is going to be a renter, which means
> they can't take advantage of the mortgage interest deduction. They
> are, in fact, paying their landlord's mortgage so HE can take that
> deduction, and that's usually a pretty sizable deduction. There's
> also hidden "taxes" that accrue to not being wealthy, like having to
> pay for things on credit. For many Americans, that means paying an
> 18% APR on many of the things they buy. The rich simply pay cash or
> the next best thing, ie: use a credit card but pay off the balance
> each month. There was a time when cc interest was deductible, but
> Reagan took care of that with his Tax Reform Act of 1986 when he took
> that away as a deduction. Another sop to the financial services
> industry that pays the campaign bills.
> One has to ask: why is it OK to deduct interest you incur on a home
> loan when it isn't OK to deduct interest on credit cards?
Maybe because that might (further) destroy the real estate market, the
housing industry (employment, raw materials, appliances, builders,
contracters, etc.) and the overall economy?
> both forms of borrowing money. Obviously, conservatives feel that
> borrowing to buy a home is "good" debt while borrowing on a cc to buy
> groceries is "bad" debt.
> So our government looks at debt and picks winners and losers as to
> who gets to deduct what. Strange how those deductions that win always
> seem to favor the rich. Then, the Rs rail against the low wage earner
> for being irresponsible (Rmoney's 47%), never acknowledging that the
> table has been tilted in favor of the rich.
> So the only question is WHAT that person with a marginal tax rate of
> 35% pays as an effective tax rate. The rich always have lots of
> deductions. They can afford financial advisors who will help them pay
> even lower taxes. Which is why they end up paying a Rmoney-esque
> effective tax rate of 13%, well below what the Average Joe pays in
> Frankly, Bob, I'm surprised that you're looking at this from such a
> narrow perspective, a perspective which equates to imagining the rich
> always pay list price for their CDs. Sadly, this myopic view is
> typical of those trying to make a case by stretching credulity to the
> point of breaking.