GOP Primary Megathread!

[Sheilbh]

Maybe - however stood back and let it happen doesn't sound like a great accomplishment.

I think it deserves some credit.  It would have been very easy for him - or McCain, for that matter - to campaign against bailouts.  In the same way as I think Bush and Paulson deserve respect for their response I think that the candidates should get some for not letting it become a campaign issue.

[garbon]

Maybe - however stood back and let it happen doesn't sound like a great accomplishment.

I think it deserves some credit.  It would have been very easy for him - or McCain, for that matter - to campaign against bailouts.  In the same way as I think Bush and Paulson deserve respect for their response I think that the candidates should get some for not letting it become a campaign issue.

That's fine - but the original bit on this discussion was Obama's accomplishments.

[alfred russel]

Most countries payroll taxes have an upper limit and even including payroll taxes the US has one of the most progressive systems in the OECD.

You're right on state taxes though, again, in my experience there was generally still a lot of deductions and credits available and they were, practically speaking, very low in most cases.  You're definitely right on the impact of state sales and property taxes.

Having said all that my understanding is that in terms of who's paying what amount of tax the US is very much an outlier.  The only country that comes close was Ireland a few years ago which had a similarly very progressive system - again based more on people in the bottom half paying very little, rather than people at the top paying a lot.

It is hard to generalize on state income taxes--some states don't even have them. But I think a rough average would be a 7% rate that kicks in around $10-$15k of income (below that with some progressivity), with income defined in a similar way to federal income.

[Sheilbh]

It is hard to generalize on state income taxes--some states don't even have them. But I think a rough average would be a 7% rate that kicks in around $10-$15k of income (below that with some progressivity), with income defined in a similar way to federal income.

I had to research states' income taxes for 2010 in my last job.  So they are difficult to generalise about, but I think a rough average of 7% is still low and the fact that many states don't have them at all doesn't seem to add to them being a significant regressive element.  Though it is a bit of a balance.

[Ideologue]

Depends on the budget needs.  Figure out how much you need to collect in taxes, and then spread the tax burden progressively.  And I mean really progressively, not this bullshit where actual tax rates spike in the middle, and then go down to near 15% at the very top.  The one problem with the top rate of 28% was that it turned out to be substantially inadequate to collect enough revenues.

The US has one of the most wildly progressive tax systems in the developed world.  The problem isn't that the very small number of people who are very rich aren't paying enough, it's that the middle class aren't.  That's further exacerbated by the lack of a VAT in the US.

There's also almost no evidence that progressive taxation is a major part in increasing social mobility or reducing income inequality.  Income transfers in various forms of state spending are far more efficient ways of doing both and in that the US is near the bottom of the table.

I find the focus on taxing the rich more, just because, sort of ridiculous.

Oh my God, it's like I don't even know you.

[Sheilbh]

Oh my God, it's like I don't even know you.

  What can I say, I'm intensely relaxed about the filthy rich.  As Mandy put it, won't someone worry about the rich?


Seriously I think everyone paying a reasonable amount of tax rather than a skewed system is actually essential for social solidarity and a credible welfare state.  It's sort of like the reverse point as if the welfare state that is just for the poor then it will be a poor welfare state.

[Ideologue]

Well, as Al pointed out, there's a lot in that post that's just straight-up incorrect, too.

Anyway, the top rate should be around 50%, I'd say.  But the bigger issue is taxing capital gains fairly.  I'd be willing to believe that "fairly" would be at more than the income tax top rate, but it should at least be equal.

[Martinus]

Well, as Al pointed out, there's a lot in that post that's just straight-up incorrect, too.

Anyway, the top rate should be around 50%, I'd say.  But the bigger issue is taxing capital gains fairly.  I'd be willing to believe that "fairly" would be at more than the income tax top rate, but it should at least be equal.

Go fuck yourself. I'm paying a 19% flat tax rate and you can only take it away from me if you pry it from my cold dead hands.

[Ideologue]

Yeah, I'm sure that's exactly how that would go down.  Next time Poland raises taxes I'll check CNN to see if the SPAP had to blow some lawyer's head off.

[alfred russel]

It is hard to generalize on state income taxes--some states don't even have them. But I think a rough average would be a 7% rate that kicks in around $10-$15k of income (below that with some progressivity), with income defined in a similar way to federal income.

I had to research states' income taxes for 2010 in my last job.  So they are difficult to generalise about, but I think a rough average of 7% is still low and the fact that many states don't have them at all doesn't seem to add to them being a significant regressive element.  Though it is a bit of a balance.

I doubt any state has a truly regressive income tax--they just tend to be rather flat. But the states without them are probably the most regressive of all: they are getting all their revenue from sales and property taxes with other fees.

[alfred russel]

Well, as Al pointed out, there's a lot in that post that's just straight-up incorrect, too.

Anyway, the top rate should be around 50%, I'd say.  But the bigger issue is taxing capital gains fairly.  I'd be willing to believe that "fairly" would be at more than the income tax top rate, but it should at least be equal.

An issue here is that many capital gains (including dividends that are taxed at the capital gains rate) are a form of corporate earnings. Corporate earnings are taxed at 35% (with additional state taxes), which is behind only Japan in the developed world. So if I get a dividend from Microsoft, while I only pay 15% on that, it has already been taxed at 35%.

[grumbler]

I've read back through what I've posted, and I don't think it is--certainly in October 2008 there was going to be a democratic presidential candidate, and that candidate may or may not have used his or her influence in the same way as Obama did. We will never know. What we do know is what Obama did.

Your insistence that Obama could have stopped all forms of TARP-like relief and ARRA-type relief is unsubstantiated by any evidence whatever.  We will never know if this is true.  All we know is what did happen.  Speculation about what might have happenned is, by your doctrine of "we will never know," pointless.

[grumbler]

An issue here is that many capital gains (including dividends that are taxed at the capital gains rate) are a form of corporate earnings. Corporate earnings are taxed at 35% (with additional state taxes), which is behind only Japan in the developed world. So if I get a dividend from Microsoft, while I only pay 15% on that, it has already been taxed at 35%.

That's the great "secret" that the ones baying at the moon over the capital gains tax rate conveniently forget.   

[Razgovory]

Oh my God, it's like I don't even know you.

  What can I say, I'm intensely relaxed about the filthy rich.  As Mandy put it, won't someone worry about the rich?

We have plenty of people who worry about the rich.  If Berkut and Yi aren't enough, they can pay some people to worry for them.

[Admiral Yi]

I think one thing that gets overlooked when talking about US tax progressivity/regressivity (at least I've not seen it mentioned) is tax credits.  Yes, payroll taxes are regressive, but I imagine it's possible for some people (especially with larger families) to get a net inflow of income tax.