Clever speech by Obama

[Scooter]

For someone earning $30,000, allowing that payroll tax reduction to expire will cost $600 per year. And yes, for them that will be exponentially more painful than it would be for those earning $1 million to cough up the $600 per week it would take to offset continuing the payroll tax reduction. One less tin of Russian caviar a week isn't going to be missed in those households.

[Sue U]

One less tin of Russian caviar a week isn't going to be missed in those households.

Won't someone think of the poor caviar suppliers?!?!?!?!?!

Job killer.

[Econoline]

It was worth about $1500ish to me last year.

How, oh how, will working class Americans endure this $2/wk reduction in their takehome pay? Spam for Christmas dinner?

$1500ish ÷ 52 = $30ish..............................................$2 X 52 = $104

Ed, meet Dave; Dave, meet Ed. Go to it.

[quaddriver]

well lets be clear, my taxes, due to the complex nature of owning 3 businesses and the fact that I get audited every year are done by HR. It lists a synopsys of where the savings came from. $1500 were expiring tax cuts and listed as such. The making work pay credit and the 15-12 (or is it 12-10) lower bracket decrease.

suffice to say, your tax is based on your income. the gizmos in the computer attributed $1500 of my refund to this. Like I said, I enjoyed it but since it hits the entire middle class its not a fiscally sound idea.

btw - not you, but others talking about millionaires is a bit disingenuous. the number of people filing as millionaires is a very very small subset of these people we 'need' to soak. As I have shown over an over, a 100% tax on the millionaires does nothing for the bottom line in this country. Except send a message that doing well is bad.

[Long Run]

I'm glad to hear that everyone appears to now agree that an expiring lower tax rate which bumps up is the effectively a tax rate increase. For the past several years, D's have portrayed the continuation of the Bush tax rates to be tax cut. They seem to be willing to change their mind by noting that the continuation of the lower payroll tax break would be a tax increase.

Of course, they do so without taking the time to understand the difference between the two different taxes. The federal income taxes pay for the general budget. The FICA tax pays for specific benefits of Social Security and Medicare, and if the benefits one receives from Social Security are directly tied into the wages upon which the tax rate is applied; that is a payroll taxpayer is receiving a promised future retirement benefit based on their payroll tax. No such promise, implied or otherwise, exists with respect to federal income taxes.

The other fallacy is that the expiring Bush rates will only increase on those earning over a million. Since, as Dave has noted, this will not raise very much money since those in that rarefied income bracket are able to shift resources around to avoid increased tax es. Knowing this, the Administration's actual proposal is to increase the rates for families earning $250,000 or more. You can argue whether the rate increase should apply only to those folks or not, but many of the families in that income bracket consider themselves middle class (and fortunate to be doing so well, for however long they are able to maintain their positive circumstances).

[Scooter]

Funny, but I distinctly remember writing "allowing [the] payroll tax reduction to expire" and not "increasing payroll taxes". So I guess it's "everyone" minus one.

The distinction you are making between payroll taxes and income tax is completely irrelevant to the effect that increases/decrease in either will have on household incomes and the economy as a whole, which are the only relevant considerations.

And I said nothing about the Bush tax cuts at all. The specific proposal to which I was referring was that which would maintain the payroll tax reduction by imposing a 3.25% surtax on incomes over $1 million.

[quaddriver]

quick note, as I outlined, the expiring cuts are *2* parts. there are actually more. the child care credit comes to mind. that one is fairly large (500 per kid) and income blind under 150K.

but also realized this, part of the defeated package was a provision to continue the freeze on federal workers for 5 years, and continue the loss of performance awards and grid increases as well as grid increases for promotions. (that part I know makes Dave happy as all get out)

[Gob]

The American tax system seems as well organised and sensible as your lunatic electoral system.

[quaddriver]

Yuuup

[Andrew D]

The only budget area where Democrats clearly are willing to make "sacrifices" is in Defense. What a surprise.

Well, if one is going to cut government spending, then cutting spending in the most bloated, wasteful, and corrupt part of government spending makes perfect sense.

[Andrew D]

I truly wonder why Andrew thinks that the Republicans in Congress are out of touch with their Republican constituents.

The Republicans in Congress are adamant that the deficit problem -- which, as previously explained, the radical right created by sabotaging the bipartisan, conservative economic policy which had dealt with that problem -- be solved without any increase in taxes.

But their Republican constituents disagree. For example, in this Gallup poll, 24% of Republicans favored reducing the deficit equally by spending cuts and tax increases; and 41% of Republicans favored reducing the deficit mostly by spending cuts and partly by tax increases.

So 65% of Republicans favored at least some tax increases to solve the deficit problem.

When 65% of a party's members favor at least some tax increases, but the leaders of that party oppose all tax increases, I think it entirely reasonable to observe that the leaders of that party are out of touch with the members of their own party.

[quaddriver]

The only budget area where Democrats clearly are willing to make "sacrifices" is in Defense. What a surprise.

Well, if one is going to cut government spending, then cutting spending in the most bloated, wasteful, and corrupt part of government spending makes perfect sense.

True. So SSA is gone? I like the cut of your sail!

[Andrew D]

The last time I checked, military procurement programs were running almost $300 billion over budget.

That's not even taking into account whether we ever needed the programs in the first place.

Many of which, of course, we don't.

Military procurement programs are a tiny bit of reality encased in layer upon layer upon layer of bullshit.

What we call the "Department of Defense" would, if reality mattered, be called the "Department of Corporate Enrichment".

If we were to slash its budget by half -- assuming that we were to choose the correct half, which the legions of leeches who survive on it would do their best to assure that we did not -- our ability to defend ourselves would be reduced by exactly zero.

Does anyone really believe that in order to "defend" ourselves, we need to spend about as much as the entire rest of the world on military stuff?

The bloat, waste, and corruption in risibly misnamed "defense" spending make entitlement spending look like a model of scrupulosity.

[quaddriver]

The last time I checked, military procurement programs were running almost $300 billion over budget.

That's not even taking into account whether we ever needed the programs in the first place.

Many of which, of course, we don't.

Military procurement programs are a tiny bit of reality encased in layer upon layer upon layer of bullshit.

What we call the "Department of Defense" would, if reality mattered, be called the "Department of Corporate Enrichment".

If we were to slash its budget by half -- assuming that we were to choose the correct half, which the legions of leeches who survive on it would do their best to assure that we did not -- our ability to defend ourselves would be reduced by exactly zero.

Does anyone really believe that in order to "defend" ourselves, we need to spend about as much as the entire rest of the world on military stuff?

The bloat, waste, and corruption in risibly misnamed "defense" spending make entitlement spending look like a model of scrupulosity.

LAst time I checked, entitlement (not limited to SSA) was running over $1T 'over budget', so I guess its time for a game of 'choose your poison wisely'?

Last part of your post makes some sense, perhaps the US should send a bill in the mail to collect for being the worlds policeman.

I cannot think of a single 'western' or western patterned nation that does not benefit directly from the US keeping the peace as it were.

[dgs49]

Dearest Andrew:

I agree with you that:

(1) The DoD budget is fat as all get-out, and I have proposed rather massive reductions in this very space not so long ago. And I didn't even get into cuts of "major weapons systems," which, as a former DoD procurement professional, are also incredibly inefficient.

(2) The budget mess will have to be resolved ultimately by a group of targeted tax increases (or removal of deductions, credits, exemptions, and whatnot), and spending cuts.

(3) The majority of Republicans agree that, at the end of the day, some tax increases will be necessary.

As for (2) it is a matter of who will blink first. The Republicans are not going to consent to any tax increases until the Dems put some REAL spending cuts - including entitlement modifications - on the table. Many of the rank&file are uncomfortable with this "strategy" as it makes the R's in Congress look intransigent - particularly when the MSM take the D's talking points and report them as "news."

[rubato]

I'm glad to hear that everyone appears to now agree that an expiring lower tax rate which bumps up is the effectively a tax rate increase. ... "

No, we don't. If the Republicans had not lied and said that the tax cuts were temporary then it would be a tax increase. But since the Republicans did lie and said they were not permanent in order to reduce the predicted cost of the cuts, they are not an increase.

Your party made this decision 10 years ago and if you were honest, you would admit it.

yrs,
rubato

[rubato]

Our real income is something over $300,000/yr every year (not including 401k and deferred income asset appreciation RE and collectable appreciation and patent bonuses) but we are taxed as if our income is less than $200,000/yr, even before the mortgage interest tax deduction.

The tax system supported by the Republican Party is designed to screw the middle class into oblivion.

yours,
rubato

[quaddriver]

which, as a former DoD procurement professional, are also incredibly inefficient."

when were you a fed? contractors, as you know, cannot do procurement.

[Econoline]

I'd imagine that you can be a "procurement professional" without actually being on the fed/procurement side of the contract; every major corporate federal contractor probably has an office full of 'em.

[Econoline]

The American tax system seems as well organised and sensible as your lunatic electoral system.

I think there might be a cause-and-effect relationship there (but at this point it's hard to tell which is cause and which is effect).