Friar Bijou wrote:
And that investment, very directly, and very measurably, increases job creation rate, and upward mobility among the workforce.
Can do those things is not the same as absolutely does do those things, but you know that.
Your statement is technically correct, but not applicable here. In this case, we can say that it "does" do what I said. What percentage of the increased profits is re-invested can certainly be subject to debate, but it's always a percentage, and it's always a positive percentage. Any positive increase in investment *does* increase job creation rate, and upward mobility among the workplace, everything else remaining the same.
Usually, the gating factor for a business to expand is profit rate over time. If it takes 10 years to earn enough profits to expand, then it takes 10 years to create the jobs associated with that expansion. If the net profits double, then the time it takes for the same expansion (and same job creation) will decrease to somewhere between 5-10 years, depending on the percentage of those profits that are put into expansion. No matter how low that percentage is, no business is going to respond to increased net profits by deciding to *decrease* the total dollar amount of money allocated to expansion.
Your argument more or less rests on the ridiculous assumption that business owners have no interest in expanding their businesses. But if that was the case, they wouldn't be business owners in the first place. It's axiomatic that they'll use profits this way, because they already made that decision by deciding to put money they already owned into a business instead of just spending it on themselves directly.
More importantly, it expands the tax base, so that over time, despite lower rates, we actually collect more tax revenue.
From the workers, not the rich...welcome to the point.
It comes from either the workers or the rich in direct relation to how much increased earnings they have, right? So if it all comes from the workers, then all of the benefits of the tax cuts went to the workers, right? So you kinda stepped on your own argument there.
And if we assumed that 100% of the increased dollars earned was to workers, and *not* the rich, then are you seriously arguing that someone would prefer to make $30k/year and pay little to no taxes or earn $60k/year and pay more? I don't know anyone who would have that preference. Do you?
You get that you are basically complaining that the tax changes would put so much more money in the hands of workers, via increased job creation and upward mobility, that they will be paying a larger share of the taxes. Um... Isn't that a good thing? I mean, if we did it by raising taxes on the working class, you'd have a point. But we're not. We're making more people earn more money. I would hope you'd be on board with this. A person making $60k/year is certainly going to pay more dollars in taxes than someone making $30k/year, but the increase in earnings is always going to be far greater than the increase in taxes.
Would you rather earn $30k/year and pay $2,474 in taxes, or earn $60k/year and pay $8,139 in taxes? (yes, I ran these numbers through a tax calculator, assuming a single person claiming only themselves).
It's not even a close comparison, right? The first case nets you $27,526 take home pay, the second case nets you $51,861 take home pay. And, of course, this assumes that the tax rate is unchanged. But in our scenario, the tax rate you'll pay on that higher earnings is lower, so... um... even more better for you, right? Specifically, the Trump tax plan will double the standard deduction. So for most people, this will be a significant reduction in total taxes paid. And yes, I get people complaining about state tax exemptions and whatnot, but the reality is that unless you have a high five figure or higher salary, and own your own home, you're going to be paying less taxes. You pick either the standard deduction *or* itemize. So unless your itemized deductions last year were higher than $9,600 (I believe that was the value last year), then you were not taking any advantage of the state income tax deduction, or property tax deductions, or the mortgage interest deduction. Since the standard deduction will double, it's unlikely anyone remotely near what we'd consider "poor" will pay more in taxes, even if they live in a high income tax state (like I do).
Heck. Even my itemized deductions were not over $19,200 last year (at least I don't think so). Mostly due to the fact that I'm in the last third of paying off my mortgage, so I'm not paying much in interest. But yeah, someone in my income range, with a largish mortgage, and in a high tax state, will likely pay more (but not much more). I'm pretty sure that group aren't the poster children of "Poor people being hurt by proposed tax reform" that most of the liberal pundits are screaming about. I even saw one guy earlier this week claiming that "students will be hurt by this". Um... How exactly? Not many students even pay income taxes at all, much less own homes, or pay anywhere near enough to be harmed.
There's a ton of crazy screaming about this going on, but not a lot of fact to support it. Which is par for the course these days.
]Given that the supreme court decided that corporations are people, they should be taxed like people (ie 36% max).
You're kidding, right? What's bizarre is that I'm pretty sure you've made this same absurd claim several times in the past, and each time I've corrected you. Have you learned from this? No. Anyway, let's try this again:
The court ruled that corporations have the same 1st amendment protections
as individuals do. Nothing more. They did not rule that "corporations are people". If your interpretation of the ruling leads you to absurd conclusions, then it's a good bet your interpretation is wrong. Which is exactly the case here.
The problem with corporations paying income tax is that it's effectively an additional tax on earnings in addition to taxes that are already paid before the money enters anyone's pockets. Let's imagine that for some reason, you and I decide to go into business together. We pool our cash, start the business, and start earning money. Let's say that we each take our salaries out of the net profit of the company (so 100% of the profits go into our pockets). Let's also say that the company earns $200k, giving us each a nice $100k/year salary.
In the case of a partnership, you and I would each get $100k in income, and pay income taxes on that number.
If we form a corporation (a full corp in this case, subject to the 35% tax rate). the corporation first pays taxes on the net profit. So the $200k gets reduced by that tax rates. Then, we would divest the earnings to us as dividends, based on the shares of the corporation we each own. So assuming we each own 50% of the corporation, we each get 50% of the resulting earnings (after corporate taxes are paid). Guess what? We then pay our personal income taxes on those dividends as well.
Of course, we could instead just set ourselves a salary of $100k/year each, which would then come out of the corporations profits (reducing them to zero in this specific case). Which would be exactly like the partnership scenario, except we're jumping through additional hoops. And, of course, zero corporate taxes are paid in that case, so having a tax rate exist at all doesn't matter.
And that brings up the real issue with corporate taxes. What it basically encourages corporations to do is spend money in some way over the year to minimize that number. And it's really easy to do, if you want to. Just buy some office furniture if you want. Or some more computers. Or company cars. Or a jet. Whatever. Anything you can call a business expense reduces "profits" (but, in this case, increases "assets" for the corporation). Which means that corporations only pay taxes on earnings that they want to save as "cash on hand" (which is usually a good thing to have at least some amount of), or if they want to pass those profits on to their shareholders in some way (like via dividends).
It's a silly tax if you really stop and think about it. And it absolutely encourages some silly behavior by corporations which may or may not actually make them more effective operations, nor encourage them to create more jobs, etc. IMO, the real debate should be about getting rid of it entirely. At the end of the day, all "profits" are taxed, no matter what path they take to get into a person's hands. Taxing it twice if it travels via one route, or only once if it goes through another doesn't make any sense. It's the kind of thing that I assume was done to appease people who don't actually understand how corporations are structured, how they calculate profits, how they share profits, etc.
Which is a really dumb way to create tax policy IMO.
ALSO: They don't offshore to make sure they can improve pay for the workers and hire more people, they offshore because they believe they are better than them poors and should have to pay. It's called arrogance and greed....but you know that, too.
They offshore if it makes financial sense to do so. In the same way that you make financial decisions based on relative cost. If you could buy the exact same product from one of two stores, and one of them is selling it for 30% less, are you honestly going to claim you'd buy it from the more expensive store? You're just as "greedy" and "arrogant" as the folks running these businesses. If you can make the 30% more net profit by operating your business in country A versus country B, you'd be an idiot to operate in country B, right? Why would you do that? No one would do that. YOU
would not make that decision either, so stop trying to pretend there's some kind of moral high ground here.
Trying to approach the issue of disparate costs by insisting that companies should just take a loss by operating in the US is a super dumb approach. In the exact same way someone insisting that you buy a product from store A, even though it costs more than store B would be. You'd laugh at them, while walking into the less expensive store, right? You know that you would.
ALSO: ALSO: They should pay into Medicaid/Medicare at the same rate as the rest of us.
Why? Do corporations get sick as they get old and need medical care? That's perhaps the most absurd thing I've read from you, and that's saying quite a lot. Edited, Dec 7th 2017 5:57pm by gbaji