News American Election

[Rumors]

I forgot to add that I made the comment about the stock market yesterday, and today as well, bc IF the American people were CONFIDENT in the vision and direction that Obama has for this country, we wouldn't be down 400 plus points over the last few days. As well, IF Germany were as confident in this administration, they wouldn't be worried about shoring up European debt bc they would feel stability in the supposed World Order OR I guess you could say that it seems that no one really has the warm and fuzzies right now.
The New World Order Ahmendenijhad speaks of may not be too far from reality. The United States MUST have energy independence within the next 10 years to fend off enemies whose vitriol spews hatred for anyone not like them. It is a scary time.

 

[Rumors]

WASHINGTON (AP) — House Republicans' hard line against higher tax rates for upper-income earners leaves re-elected President Barack Obama with a tough, core decision: Does he pick a fight and risk falling off a "fiscal cliff" or does he rush to compromise and risk alienating liberal Democrats?

Or is there another way that will allow both sides to claim victory?

Obama has been silent since his victory speech early Wednesday morning, but is set to weigh in Friday in remarks at the White House.

Capitol Hill Republicans, meanwhile, vow to stand resolutely against any effort by the president to fulfill a campaign promise to raise the top two income tax rates to Clinton-era levels. A battle would set the tone for the start of the president's second term.

"A 'balanced' approach isn't balanced if it means higher tax rates on the small businesses that are key to getting our economy moving again," House Speaker John Boehner, R-Ohio, said on Wednesday. "Raising tax rates is unacceptable," he declared Thursday on ABC. "Frankly, it couldn't even pass the House. I'm not sure it could pass the Senate."

A lot is at stake. A new Congressional Budget Office report on Thursday predicted that the economy would fall into recession if there is a protracted impasse in Washington and the government falls off the fiscal cliff for the entire year. Though most Capitol-watchers think that long deadlock is unlikely, the analysts say such a scenario would cause a spike in the jobless rate to 9.1 percent by next fall.

The analysis says that the cliff — a combination of automatic tax increases and spending cuts — would cut the deficit by $503 billion through next September, but that the fiscal austerity also would cause the economy to shrink by 0.5 percent next year and cost millions of jobs.

The new study estimates that the nation's gross domestic product would grow by 2.2 percent next year if all Bush-era tax rates were extended and would expand by almost 3 percent if Obama's 2 percentage point payroll tax cut and current jobless benefits for the long-term unemployed were extended as well.

All sides say they want a deal — and that now that the election is over everyone can show more flexibility than in the heat of the campaign.

Obama will address the issue Friday though he's not expected to immediately offer specifics. His long-held position — repeatedly rejected by Republicans — is that tax rates on family income over $250,000 should jump back up to Clinton-era levels. Republicans say they're willing to consider new tax revenue but only through drafting a new tax code that lowers rates and eliminates some deductions and wasteful tax breaks. And they're insisting on cuts to Medicare, Medicaid and food stamps, known as entitlement programs in Washington-speak.

The White House's "opening position is, 'We're willing to do big entitlement cuts. In return we need you to go up on the rate,'" said Democratic lobbyist Steve Elmendorf. "Then they're going to get into a discussion. It'll be a process."

The current assumption is that any agreement would be a multi-step process that would begin this year with a down payment on the deficit and on action to stave off more than the tax increases and $109 billion in across-the-board cuts to the Pentagon budget and a variety of domestic programs next year.

The initial round is likely to set binding targets on revenue levels and spending cuts, but the details would probably be enacted next year.

"What we can do is avert the cliff in a manner that serves as a down payment on — and a catalyst for — major solutions, enacted in 2013, that begin to solve the problem," Boehner said.

 

[anthony]

I just read in todays Financial Times, that the Republican party has agreed to raise taxes, however; not for the 'rich' as Democrats wanted. Republicans also want some reforms as a compromise. Sounds a bit silly though not to be funnelling some wealth back from the rich at this point to help with US debt.

IMHO, the rich take without thinking it will cost them later. Then when times like this hit, they are exactly who it should be costing more than anyone else.

What do you think is the middle ground Rumors? What is your opinion on how to balance US finances and get the country going forward again?

Obviously there are unforeseen issues in that equation, outside of US control, that occur Internationally.

I was just reading that the state our current Government has made, will put us not far beyond that of the US and UK in the way of annual deficit if they don't cut Government spending soon. Our Government has been too spendy over the years, wasting money in half arse ideas and schemes that have bitten them in the arse. Independent analysts are doing the figures and they aren't balancing as per our shitty little treasure claims.

 

[Rumors]

I guess you have to first define what "rich" is in this country. In Obamas model, it is anyone making more than 250k a year. This is where it gets tricky. It's not like they are taking home 250k but from what the Republicans believe, that threshold will most likely hit the middle class harder than the true rich. Those who who make 250k will likely be forced to cut back, and perhaps even lay off employees. They are truly middle class Americans who work hard and will be the most effected.

Also, there is no proof that tax hikes WILL produce the needed shortfalls in the years to come. However, there are models that prove it will cause stagnant growth and most likely even cause some ticking up in unemployment. Now, where the media twists the message is that the R's don't want higher taxes for the rich, but studies show that the greatest group to be effected by this tax hike are the middle class small business owners who are just barely hanging on. Then you add the Obamacare expense in 2014 and 2015, guys you can't expect small business to survive these conditions in such a marginal economy. Romney even said in a speech that he wasn't concerned for large corporations, they can afford it, but small business can continue to eat expense without something giving. No one wants higher taxes, however I worry about my friends whose businesses teeter on the edge NOW. I can tell you it won't create new business.

The answer? It lies somewhere in the middle HOWEVER, without a deep reform of tax codes, all of this truly will do nothing except hurt the middle class. The corporate class will shield themselves thru corporate loopholes and they will survive any tax increase Obama implements. That is the scary part. The group he claims he intends to tax will ultimately not be burdened but those who aren't insulated by corporate shields and depend on the disposable income will be damaged beyond belief.

That is the tricky part of all of this. We get caught up in key words like, "rich" without even knowing what defines that. If you take 250k and take off 39% for federal income tax, then start chipping away at it with state and local taxes, you have taxed more than 50% of their income! There is tax on everything! Then Obama has the balls to say that we didn't build our businesses bc the government provides roads and infrastructure! Who pays for all of that? WE DO! We pay for it through all of these tax dollars they collect.

And then, let's just talk for a minute about the true unemployment rate of this country. That rate is calculated using part time employees. Part time can be 10 hours a week to 25. However, we know that they are not making it. The unemployment rate not using part time is actually 14%. You won't ever hear that number out of this administration. Then, realize that there is also a calculation for the number of people who fall out of unemployment services who just plain ole give up and go on government subsidy. They don't calculate them in either.

Plain and simple truth of the matter is this, Obama has a plan that even some Democrats have expressed worry about. No one is convinced that taxing the middle class "haves" will create enough revenue to bail us out of this mess, except Obama and a key group of followers. The middle class WILL bare the burden of this and when you add together ALL of the burdens that he has brought to the plates of the middle class, it will make growth impossible for many AND will likely spiral many business who are on the edge into bankruptcy. We must have a model that is more growth friendly and doesn't take disposable income away. The clear and easiest way to do so is by closing loopholes that LARGE corporations seem to use.

Have you ever considered that perhaps Obama has got this one wrong? He has sold the phrase, "rich" so many times that people around the world think of Donald trump and folks like that. They don't think about the small gas station owner, hardware store guys, beauty shop gals. Those are the ones who will be effected most. Donald will live to see another day. If you buy into everything Obama says, you won't truly grasp the real concept of what he is suggesting. Do you understand now that first you must define what he claims is rich? Do you understand that it is not like these folks have 250k in their pockets and they are walking away free and clear? It is 250k less all of the taxes and overhead and they walk away with less than half of that as disposable income. If you live in states like California or New York, 100k can't match cost of living expense. Sad but true. Gas is $4 and we don't have the subway infrastructure in most areas like Europe. Our bus services are limited to inside city limits only and not rural areas.

All of these things must be taken into consideration and Washington can't simply forget about a class of people bc it isn't popular. The war of classes really lies with the middle class as they are divided into two groups. The middle class "haves" and the middle class "have nots". The middle class haves are small business owners who work hard, take a lot of risk, and bring home respectable pay. The have nots generally work for someone, work hard but can't quite get out on their own, but long for more. The rich don't care bc they know how to stay rich. The true war lies within the middle class and unfortunately have the most to loose with this Obama tax plan.

Just my humble opinion though. :-)

 

[intothelight]

So many great points here and it will take me a while to absorb them all.

The comments about small business really hit a nerve as my husband and I own a small business. The reality is since 2009, growth has stagnated and we have seen a reduction both our revenues and correspondingly our workforce. Yes, small business is in the economic vice and the sad part is, this is the sector where you find your greatest amount of job creation, which fuels economic growth and increases the tax base.

Yes, Washington's first priority needs to be the balancing of its own budget. Common sense says that you can't spend more than you earn, and governments should not be an exception. Close the tax loopholes, let trade take place without more barriers and red tape. Let business grow, create more jobs, and then you have more revenue. The less tax that business pays, the more that goes back into the business. (Yes, there are always exceptions and those that are greedy, but for most small business owners the survival of the business is tied to their own personal survival and something that is personally more important...a dream.)

I am just a tired American who is fighting to hang on to a "dream" and at this point is just hoping to keep making payroll and paying bills. Loved that financial institutions shored up their lending practices and became more fiscally sound, but they also stopped lending. Small business lives or dies by cash flow, and without credit and the economic reality of "slow pays", growth, expansion, "the five year plan" are non existent. It is just about survival and keeping the doors open.

 

[anthony]

I absolutely agree that 'rich' needs to be defined. Middle class is typically the backbone of all economies. It is where most of the employment lay, home loans and economic investment. I understand the expense of a few locations in the US as well. The same applies here, city to city vs city living to 50km outside the city costs.

Even with the tax rates mentioned above, $250k and above is ample income if you're talking personal income. $125k in the hand, using 50%, is not to be sneezed at and crying poor IMHO. I also base that upon the assumption that business income is then taxed uniquely as to a profit or loss. Not sure on how US business taxation is handled. Honestly, if you're taking home $250k per annum you shouldn't complain if required to pay higher tax IMHO.

I don't understand how that's to affect small business though... are business and income tax separate taxations in the US?

 

[intothelight]

Yes, business and income tax are separate. Also the Census Bureau valued the median annual income at approximately 50K. Don't think incomes of 250K really represent the middle class, as I believe the statistics for the percentage of the population that earns that much is less than 5%.

 

[anthony]

That's what I was thinking... $250k and above isn't middle class IMHO, that's putting people on the upper class bracket IMHO.

Honestly, for those earning $250k and above, I think it is whinging about not having as much to waste versus money to employ. I don't see why disposable income to waste is really relevant in hard times... other than more selfish of the individuals themselves. This is the quintessential issue in most economies it seems... the rich are always screaming poor, yet they don't have a real idea on what poor is half the time.

That is not knocking hard work and building wealth... but people running their own business can create lots of business expenses for themselves that they benefit, ie. cars are business owned, thus tax deductible. Your personal income isn't then paying for, nor maintaining such costs.

I honestly see no issue with $250k and above being classified as rich based that income and business taxation are separate. It is a whole different thing if businesses were being taxed for earning $250k versus having $250k profit. Again, not sure how America works on that part, but here your business earnings have nothing to do with the overall picture of taxation, instead it is based on net profit that is taxed from the business view. Wages are already being taxed and are a business expense, not taxed twice in other words. I assume America is the same?

I also understand that this is not exclusive to America, but every economy, in relation to disposable income. What we all spend our money on is what makes the economy go round. When we don't have the spare funds, then we don't spend, travel, etc... and thus economies collapse. I get that. Closing tax loopholes doesn't fix that issue for inflation though.

What are solutions to the overall problem? I've been reading this a lot lately in financial information... but nobody really has an overall solution, as the 'global economy' is currently going around and around affecting country after country like a merry-go-round right now. Just as one starts to get ahead, a full rotation occurs and the country sinks back again.

I don't honestly think you can put the climb or fall onto a countries leader, as the people making those decisions are typically behind the scenes. Federal banking, entire political parties, opposing party politics for the sake of opposing, etc etc. I think leaders have an input, but really most things occur based on collective groups of specialists who strategise and advise a plan of attack. From the political view, IMHO, that usually comes down to political party makeup. Our two parties, for example, you could pretty much say one is a spender, one is a saver. When the country gets too encumbered in debt and prices go too high, the other party gets elected, they cut spending and save, save, save. Saving has its own repercussions, then just as we get on top of things, though not really forward momentum, the population gets the shits and wants money spent... so the spender party gets elected and spends the savings, then borrows to continue spending... and so the merry-go-round occurs.

I guess maybe some days it's easy to just go bang head on wall. :banghead:

 

[intothelight]

Anthony, I agree and nothing will be resolve by extremist views from any political party. Sad thing is, to do what is right will require putting personal political ambition to the side. Like anything, there is no quick fix and no matter the approach, any budget is going to require cuts. Any place those cuts occur, the special interest groups are going to cry "foul" as few look beyond the short term pain required for long term gain.

This last election caused so much polarization. There is so much that is not covered by the press, but I believe the popular vote shows just how split this country is. But somewhere in both camps lies a moderate majority, and it is time for them to join forces and do what is best for the whole.

I never did get the "depression era mentality" of my grandparents, but now I do. Unfortunately that generation is almost gone; but post depression, their ideas and values seem to be relevant in the spend and pay later society that permeates our culture. I hope the world doesn't have to experience an economic collapse on that scale to start "getting it".

 

[Deleted member 12723]

I like the libertarian party. It is better. I am afraid for the future of this country. We live on social security. My husband paid into all his career. It is very hard to live on a fixed income. We really have to watch how much we spend.

I sure hope both parties will set aside ideologies and work on compromises to help the middle class.

I do not understand the polarization. It is driven by pure emotion, beliefs, and ideology. They have to answer to their supporters. I think alot of our government is out of touch with real people and real problems.

So many people have become homeless. So many homes have been foreclosed. My heart goes out to these people. I think some other countries are doing better with their people than the US.

I wish we could set our differences aside and agree to disagree and work on compromises where both sides give alittle for the benefit of the people.

My daughter lost her job as a dispatcher and cannot get another job. She is on unemployment. They came really close to having their house foreclosed on.

I hope a better outcome for us. I am grieving that our country is so fiercely divided. Both sides are guilty in my opinion.

 

[Rumors]

Anthony,
Please be sure and read my reply. 250k taxed at a federal, state, and local level less overhead. Property taxes, insurance for cars, homes, etc is very expensive here. Your take home is less than half after everyone gets their hands in the bucket and if you are a family of four, that doesn't go far. Clothes for kids, food, electrical, water, etc. It works out to be ALOT less.

Taxes for business depend on how the business is set up. A sole proprietor, S-Corp, or LLC. They vary and all of the deductions are calculated differently tax wise for each. It would be dependent on the type of business you do as to how you have it set up.

 

[Whitneys story]

I will not carry people who will not bother to help themselves... nor be inticed

Albatross, You are on a roll! I am afraid to post here I am so angry. Precisely the expectation our government to cater to the lazy. I am not speaking of those who try, those who have paid into our so called entitlement. :mad::banghead: Someone figure it out please! We have 23 million unemployed, we have 22 million illegals. Do the math it is not that difficult.