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comment by hootsbox
hootsbox  ·  4667 days ago  ·  link  ·    ·  parent  ·  post: Debunking the Bunk
By the way, the reason capital gains are taxed at a lower rate is to encourage investment and finance companies that hire people like you and I. How do you think venture capitalists work? They get big rewards because they take their money and risk it on ventures that may or may not work out which is more than most folks are willing to do! How many success stories would we have in this, and other, countries, if people did not risk capital? How many people have been hired due to Microsoft or Apple (and related industries) worldwide - hmmm? You state that there will be aggregation at the top, however, many capital gains are made by senior citizens in their savings, 401K, IRA, etc. Many "working class folks such as firefighters, teachers, etc., through their pensions and like instruments, also make capital gains. Also, other working folks, like you and I probably are, also get capital gains through our mutual funds, 401Ks and the like. So, to say that it all aggregates at the top is not telling the whole story; we all make capital gains. Let's look at it another way, MK. I don't suppose that if the real estate market were in good shape these days, and you bought a house near where you are for (simplification's sake) $150,000.00. You worked and lived there ten years, then you got transferred, and at that time, your home is now worth $200,000.00. So, (given we also ignore the $600,000.00 capital gains tax exclusion in buying a new home) you would, if you sold it and cashed out, you would pay 15% (or whatever the CG rate is at the time) on the 50K. If I read you correctly, you will be willing to count that as regular income and pay 24.5 percent on that 50K right? I don't think so buddy; you will do what the law says and so do millions of "regular" people.

Let's take one more example of the "Buffet Rule" since the current "politic speak" is, "Why should Warren Buffet pay less of a tax rate than his secretary? This is not FAIR!" Well look at FACT Check's research here:

http://www.factcheck.org/2011/10/shes-no-buffetts-secretary/

Or this one about the teacher who makes $50,000.00 a year:

http://www.factcheck.org/2011/09/obamas-teacher-tax-whopper/

Part of this "half baked" idiom is that Warren Buffet pays himself less of a "salary" than his secretary, so on ordinary "payroll" income; he would pay a lower percentage. Do you think that he really pays fewer taxes than his secretary? Here's a Forbes article on the subject:

http://www.forbes.com/sites/paulroderickgregory/2012/01/25/w...

As to those that "inherit" their wealth over those who actually invent stuff and work for it like a, now deceased, Steve Jobs, here are a couple of links if you care to read. Money magazine had an article a few years ago as well and estimated that only 10% of the top 1% of the wealthiest persons actually "inherited" it.

http://www.consumerismcommentary.com/most-wealthy-individual...

If you expand it to just billionaires:

http://moneytipcentral.com/self-made-vs-inherited-billionair...

As to who pays what and what is FAIR? Here's the real story:

http://ntu.org/tax-basics/who-pays-income-taxes.html

The bottom line, this "the rich don't pay their fair share" is a bunch of bunk foisted on the American people by political "charlatans" who exploit those who won't do the research, into believing "half truths" and "twisted stories" and "slanted presentations of the whole story" to gain political favor and get "voted in" so that they can reward their "political buddies" who helped them gain power. The only way you and I can help "clean up Washington" is to make informed decisions about who we sent to represent us (no matter what party you have a tag to!), and send people who are willing to tackle the tough problems "head on" with no "cock-n-bull" stories and let the American people know the facts - period. As long as we vote these disingenuous individuals in, we will get what we vote for. Let's FIRE the ones that don't do a good job - they work for US - not the other way around!





mk  ·  4667 days ago  ·  link  ·  
I feel like you didn't read my comment.

I can see the benefit of a low capital gains targeting seniors or other middle income Americans. We could reinstate a marginal rate for capital gains similar to most of the rest of last century. Are you aware of what the marginal rates were?

http://en.wikipedia.org/wiki/File:MarginalIncomeTax.svg

A very basic example of a fairer capital gains code, would be for earnings over 1M, it is taxed as normal income.

Look, I do brain tumor research. I went to school for 20+ years to do it. I work to develop cures and treatments for a very deadly disease. If you are very savvy, you might get me to buy in on a philosophical level how someone like Warren Buffett or Mitt Romney does something commensurable to pay at a level of 1000x or 200x mine. But, you will never get me to agree that they should be taxed at half the rate. That's not a worldview I will buy.

Tax rates shouldn't decrease as earnings do. Being wealthy is a pretty good reward, no need for a regressive tax rate.

hootsbox  ·  4662 days ago  ·  link  ·  
As I have stated prior, I am more of a flat taxer and favor dumping the current tax code with all its finagling and changes to reward political supporters, lobbyists, and "friends". This currently applies and has applied to ALL POLITICAL PARTIES, and we should elect people who will actually make changes in the tax code. However, we still disagree on the progressive taxation issue which does, factually and historically, have its roots in Marxism (which I completely reject). To say to a person, who creates thousands and millions of jobs and creates employment opportunities for those folks to move from lower all the way to upper class, that you should be penalized for taking the effort, putting your capital at risk (they don't always work out and nobody wants to hold "protests in the park" to get them reimbursed even if they lose everything!), sacrificing time to build that enterprise, that we should now take the choice to "share or contribute to charities of choice" (understanding not everyone has the heart to do so, but I bet you and I would!) and force them to pay for others (who don't do the same things and never would because they are just not "motivated" to do so) is just not the right thing to do - IMHO! Good Day!
easynow  ·  4667 days ago  ·  link  ·  
Typical politicians"Always answer the question they'd wished they'd been asked". Apparently you were wishing that someone asked you about the Warren Buffet Rule. What I read in mk's previous comment was a genuine desire to try to get beyond the standard rhetoric of Right vs. Left. He literally says regarding the capital gains discussion "But, to be honest. I'm not really interested that much in that argument, but it's very evident that you are. The differences here are predictable. And that's kind of sad.

I'm curious Hootsbox, what are some of the areas of politics that you think Left and Right agree on? What can we get done as a country? Where is there common ground?

Now ask yourself this, how often do you focus your energy on these things?

hootsbox  ·  4662 days ago  ·  link  ·  
I probably should have put it in the thread on "Is Capitalism the Villian", but others in the current thread mention taxation and the way it should be applied. I used the "Warren Buffet" story because it is headline and current and has an object lesson to both arguments, and it is just the type of thing that gets bantered about in the press, on political speeches (and a featured item in the State of the Union Address).

On a very high level, at this point in the discussion, I would say both the Right (or Center Right) and the Left (or Center Left) would agree that:

1. Corruption is bad no matter where, when, who, and what realm it is in. 2. The concept that people take financial and political advantage of people and that is wrong is a point of agreement - that applies across the board I would think. 3. That politicians have taken the place of "statespeople" and honest representatives and made our current government structure one that is not enviable IMHO. That would be a point of agreeement.

thenewgreen  ·  4662 days ago  ·  link  ·  
Hey hootsbox, hope you are well. Perhaps what easynow is referring to is that when you hit "reply" under a previous comment it is generally assumed that you are carrying on a conversation with that individual. Meaning you respond to their previous comment and points. Otherwise, just use the text box at the top of the post for general comments. Does that make sense? Glad to see you on the hub! -TNG
easynow  ·  4661 days ago  ·  link  ·  
That is part of what I was referring to. I just see Hubski more as a place where people come to discuss new or interesting ideas not argue using boiler plate rhetoric from fox or cnbc.