President BO (the amateur president) keeps saying he is willing to work with "the other side" and is willing to negotiate with them on their ideas.
The only thing he won't negotiate is the very thing that is at the heart of the "fiscal cliff:" an increase on taxes for the "rich."
In other words, we can work on all of the irrelevant things, but when it comes to what he is really after, it's a no-go.
There is a remedy for the "fiscal cliff," if anybody really wanted to solve it. They won't, though, because solving the economic issues facing our country is not at all important to politicians...none of them.
The solution to the country's economic woes is as simple as it is complex.
If that seems contradictory, that's because the solution is mathematically easy, but politically difficult.
The reason it's politically difficult is that politicians really, really care about the country on an emotional level, but are much more concerned about their personal influence, power and getting re-elected...all of them.
The solution is a flat tax on every earned dollar, be it corporate, individual, interest or whatever, over the "poverty" level.
Do not confuse the flat tax with the so-called "fair tax," which is not fair at all, but is a glorified sales tax which would place a larger burden on poor people than it does on rich people wanting the same goods or services. It would also be as big an accounting nightmare as the present despicable system.
With a flat tax, everybody pays the same fair percentage of their earnings. There would be no more of this "they don't pay their fair share" idiocy.
For the sake of discussion (and keeping the math simple), let's say the poverty level is $20,000.00 per year.
Every earned dollar over that amount would be taxed at say 10% (an arbitrary figure for the sake of this discussion - see the above paragraph). Dollars earned would be the total of individual earnings, the profits made by a company or corporation, interest earned on savings and investments and the like.
There would be no deductions, no exclusions, no "loopholes" and no exceptions.
The filing of tax returns would be made on a simple 4" X 8" card with just a few lines:
FEDERAL INCOME TAX RETURN
1) What was your total individual income. Include personal income from wages, interest earned, tips and all other sources excluding direct gifts. If this is a corporate return list the total income of the corporation. ___________2) If this is a corporate return, list the gross profit of the corporation. ____________
3) Subtract $20,000.00 from your total individual earnings or the corporation's profit. -____________
4) Multiply the remainder by .10. ________________
5) The quotient of #4 is the federal income tax you owe. Make checks payable to the U.S. Treasury.
With a system this simple, fraud and cheating would be minimized, as employers would be required to report the gross income of employees and corporations would be required to provide proof of their corporate earnings.
The major reason something this simple is so difficult to grasp and implement is that politicians actually prefer fraud and corruption over honesty, integrity and character. They enjoy the game of trying to "put one over" on the other guy (or gal).
There are a couple of other things that would be needed to avoid "fiscal cliffs." One of those would be a "one bill, one subject" amendment to the Constitution, which would eliminate unrelated amendments to a bill that favor a particular political district.
The "fiscal cliff" would also be avoided by opening free and easy competition on the world market, coupled with a reasonable tax on goods produced overseas for import to this country.
Another would be an amendment that removes all regulations on individuals and corporations that do not directly involve preventing physical, emotional or fiscal harm to another person or a person's property.
Still another part of the remedy to the "fiscal cliff" is to get the federal government out of involvement with things that do not directly include uniting the country, establishing true justice, keeping domestic peace, providing a strong defense for the nation, promoting (not providing) the well being of the people, and ensuring that liberty is not violated.
The final death of the "fiscal cliff" would be to remove all duplicate federal laws and simply enforce the ones necessarily left in place after implementing the removal of regulations as mentioned above.
I wonder whether President BO would be willing to compromise his Socialistic and class warfare agenda in order to achieve the actual demise of the "fiscal cliff."
I doubt it.
20 comments:
No serious investor will accept a straight up 10% tax on interest income. The right believes you need the lower carried rates than you and I pay on income to encourage investment and "job creating."
This would also result in a massive tax hike to homeowners in the 50k range who get that interest deduction now.
Between kid deductions, the charitable deduction and the home mortgage deduction, a two kid family making that 50k can get very close to zeroing out all their taxes.
How do you propose to politically sell this plan?
Even with taxes at the current nonsensical standards (and I fully agree with the flat tax and think 10% would more than fix our problems), the major problem is that our politicians can't seem to stop spending money on things that the Constitution never authorized. They can't stop spending money to make constituents happy so as to keep themselves in office, no matter how fraudulent and illegal the expense may be. They never look out for the country - they only look out for themselves and to hell with what happens to the country.
DM: "How do you propose to politically sell this plan?"
I don't.
I am presenting it as the solution to our "fiscal cliff" problems.
My plan does not allow deductions on anything, kids, charities, home mortgages or anything else, because my plan ensures parity. Its goal is to have everybody pay a fair tax, not to zero out some people, rich or middle class.
I couldn't care less whether "serious investors" like the plan. The plan is a solution to a problem that has and will continue to bankrupt us as a nation.
G.E.C.: Power is all they care about, period.
We no longe live in a Constitutional Republic, but have morphed into a legislative dictatorship.
And politicians like it that way.
Joe - I assume your plan would also remove the tax exemption currently given to churches and other religious organizations.
X.O,
And remove the exemptions from all other "charitable" organizations. Such as all the enviro-nazi groups, tree-huggers, etc
This is another progressive smash and grab, nothing more.
To be fair, they are just following in the Bush Gang's footsteps, when Dirty Hank Paulson and his gang of Pirates blew a hole in the side of The Treasury and looted it, filling the Wall Street Gangsters pockets after the crash of '08.
People voted for Hope and Change twice. Get used to it. This is the new normal.
XO: "Joe - I assume your plan would also remove the tax exemption currently given to churches and other religious organizations."
Yes, with one concern. Some charitable organizations exist only from donations from people who have already paid taxes on their income. It might be well to exempt them to avoid double taxation. If they receive income from any source other than donations, I would definintly tax them on that income.
G.E.C.: "...enviro-nazi groups, tree-huggers, etc. should have to pay twice (in spite of my above comment), since they find ways to receive federal tax dollars for their "work."
SF: It is, sadly, as you say: the new normal.
Joe - 'but...[politicians]are much more concerned about their personal influence, power and getting elected...all of them.'
Is there no one that cares about our country more than themselves and their political career?
If there is - we need him or her to come forward - the sooner the better.
before we fall off of the cliff
Joe, your revenue comes up short.
What are you gong to cut? Even a stiff like Romney pays more than a 10% rate if he can't stuff the cash in the Cayman's or work an IRA scam with GM parts suppliers.
Are you going to fund Medicare and Social Security?
This needs work, Joe.
Joe, would you tax John Hagee and Joel Osteen and the rest of those sharper?
Joe, I have a question.
Your 10% lowers taxes on the wealthy and raises them on the poor.
Since all research demonstrates that the rich are just going to take their money to the Wall Street casino and not create demand, what happens to the economy when aggregate demand falls?
I don't think you've thought this out.
Ducky: Pay attention. The poor (genuinely poor) earning less than $20,000.00 per year pay nothing...nada...zip.
And your math is fuzzy to grossly understate it.
Plus, as usual, you missed the point.
Ducky: Key words: EVERY earned dollar over $20,000.00, corporate and private.
Joe, you raised taxes on the poor by eliminating the Earned Income Credit.
Is the social security tax in place under your plan?
Ducky: Didn't deal with Earned Income Credit, Social Security or Medicare, all of which are separate issues.
However, I do have a plan for each of them.
Joe - "Yes, with one concern. Some charitable organizations exist only from donations from people who have already paid taxes on their income. It might be well to exempt them to avoid double taxation."
That's B.S. There is no double taxation.
Yes, the people donating have already paid taxes on THEIR income.
But the church receiving the donation hasn't paid any taxes on IT's income from the donation.
Churches and religious organizations should be taxed on their income (donations)at the corporate rate.
They provide a service in exchange for a revenue stream. They're a business and should be treated and taxed like a business.
Especially the Catholic Church. They should pay personal property taxes on their worldwide Real Estate holdings as well as their artwork, libraries and sculptures.
The Mormons require every member of the faith to tithe 10% of their income. The Mormon Church should be required to tithe 10% of THEIR income in taxes.
That would fall exactly in line with your 10% flat tax with no exemptions or loopholes.
Unknown (whoever you are): "But the church receiving the donation hasn't paid any taxes on IT's income from the donation."
You don't know what you are talking about.
Churches pay property taxes, payroll taxes, and many other municipal and state taxes. The only tax they don't pay is federal income tax.
As I said, I would not get stuck on this point, although I, personally, consider federal income tax on the church double taxation.
"The Mormons require every member of the faith to tithe 10% of their income. The Mormon Church should be required to tithe 10% of THEIR income in taxes."
That's false logic. One does not follow from the other. There is certainly no such thing as a "tithe" tax on churches. A tax is a tax and a tithe is a tithe.
There is no more reason for the federal governmen to involve itself in church matters as there is for churches to involve themselves in government matters.
"Separation of Church and State," although it is being misapplied today, works both ways or it doesn't work at all.
Please give yourself at least a fake name when you post here. It helps me know who is who. If two "Unknowns" comment, I can't tell whether I have two comments from one person or two comments from two people.
Helps with discussion.
Joe - I'm "Unknown". Glitchy validation issue. But I digress.
Donations and tithes to churches are income to churches and should be subject to income taxes at business rates.
Churches provide a service for which they receive an income. They are a business and should be taxed like a business.
That is a loophole that needs to be closed.
XO: In 53 years of ministry I have never been a part of a church that provided a service and received an income for that service.
The only income any church I've been a member of received was offerings from the congregation in exchange for nothing. They give out of love for the Lord and in appreciation of what He has done for them.
In our denomination, the congregation has complete control over how those offerings are used: to pay a pastor and/or staff; air condition the worship center and other things as they see fit.
Having said that, I reiterate: I would not fight very hard to prevent a church from having to pay federal income taxes, but I would not recommend it.
It would be an invitation for the federal government to control what the church does.
That I would fight to the death.
Joe - The services a church provides are the services themselves. The routine, the ritual, the sermon, the hymns, the Sunday School indoctrination for the children, the summer Bible School Camps, weddings, funerals, hospital visits, Last Rites, Communion...
These are the services the church provides and the income they receive in exchange for those services are the offerings from the people partaking of those services.
When the church elders walk down the aisles passing the collection plate back and forth, they are essentially billing their customers for the service being provided.
That's a business.
Comcast can print "Love Offering" on my bill, but it's still a request for payment in return for service rendered. All Comcast can do to coerce payment is threaten to no longer provide the service. A church has the social pressure of the implicit disapproval of the people in the pew who see you pass the plate without contributing.
But if you want to see REAL disapproval, just try grabbing a few bills out of the plate, looking up and saying "Thank You Jesus!"
It seems to be a one-way cash flow there.
OK, quick joke.
A Minister, a Priest and a Rabbi are comparing notes on how they determine what percentage of the collection plate goes to the work of God and what percentage goes to their salary.
The Minister says "I draw a circle on the ground, stand in the middle of the circle, and throw all the money up in the air. All the money that lands inside the circle goes to God, all the money that lands outside the circle goes to me."
The Priest says "I do the same thing, except all the money that lands inside the circle goes to me and all the money that lands outside the circle goes to God."
The Rabbi says, "I don't bother with circles. I throw all the money up in the air, what God wants, God keeps, anything that comes back down is mine."
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