PDA

View Full Version : Economics



joecoolfreak
09-17-2008, 12:46 PM
I usually don't post about politics, but I am a diligent reader. As of late, I keep seeing things that people post that I seriously don't understand, so I am going to throw some things out and see what happens.

Lets start with all of the talk about taxes. This has been posted before, but I don't think many people are reading this one very clearly:
http://media3.washingtonpost.com/wp-dyn/content/graphic/2008/06/12/GR2008061200193.gif

Now, what can we read out of this one. I am SO tired of reading that Obama is going to raise taxes on the small business owners and they are going to charge more etc...Very clearly, according to the chart, Obama's proposal is if you make between 225k and 603k per year gross income, you are going to pay 12 dollars less a year in taxes. I don't think any small business owners are going to go out of business making 12 MORE dollars than they did the previous year. According to Obama's plan, you have to make more than 600k annual salary before your taxes will increase over their current rate. Now, for all those that are confusing personal taxes with corporate taxes: THEY ARE COMPLETELY DIFFERENT. They are different because you have to separate corporate income (profit) and your own personal income (salary) in order to be a corporation.

Now, how much do small business owners make on average you ask?

According to the survey, the national average salary for the CEO/Partner/Owner job function is $258,400; however, compensation varies widely across geographies. For example, small business CEOs/Partners/Owners in the District of Columbia earn $395,000 annually -- more than 2.5 times as much as their counterparts in Oklahoma.
source:Salary.com (http://www.salary.com/aboutus/layoutscripts/abtl_default.asp?tab=abt&cat=cat012&ser=ser041&part=Par545)

That means that small business owners will certainly not have to be paying any more personal taxes under Obama's plan, because most/if not almost all are making well less than 600k/year. Again, try not to confuse how much their businesses make with these numbers, because this is discussing the personal tax code. Now, if you are a one person business and your business NET's over 600k/year and you don't use that money to reinvest in your business and choose to take that profit as your salary, you deserve to get taxed at a higher rate because you suck at running a business from a financial standpoint.

So what is Obama's plan for the corporate side?

Provide Tax Relief for Small Businesses and Start Up Companies: Barack Obama and Joe Biden will eliminate all capital gains taxes on start-up and small businesses to encourage innovation and job creation. Obama and Biden will also support small business owners by providing a $500 “Making Work Pay” tax credit to almost every worker in America. Self-employed small business owners pay both the employee and the employer side of the payroll tax, and this measure will reduce the burdens of this double taxation.
source:Barackobama.com (http://www.barackobama.com/issues/economy/)

So, not only will small business owners be saving in personal taxes under the Obama plan, the will be saving significant amounts of corporate taxes because they are exempt from capital gains.

Now, let's take a step back and look at the bigger picture. Why does the economy look like it does at the moment? I hear lots of opinions about gas prices, the housing bust, outsourcing etc..., but if you ask me, it is really quite simple. Almost all of these (especially the cost of fuel) are drastically exacerbated by the falling value of the dollar. The source of that problem is very easy to identify. All of the foreign investors (who own all of our exponentially large debt) have lost confidence in our ability to pay it back. Wow, wonder where they got that idea.

Any year we spend more than we bring in, we are going to weaken the economy. It's that simple. There are two easy solutions to this, stop spending money and bring more in(taxes). Lets focus on taxes again. If you look at Mcain's plan, we are cutting taxes across the board. That simply means that we are making less money in tax revenue. Obama's does the same, it just doesn't cut everyone's taxes as much. He raises the taxes for some and lowers it for others to reduce the amount of revenue lost in the process. Both policies are flawed in my opinion, but one is much more flawed, because ultimately it is going to weaken the dollar more and therefore, continue the economic trend.

Now for spending. I don't doubt that the democrats are planning on spending more money on government programs, but let's be honest. The republicans aren't any better about choosing where that money goes. If I had to choose between spending 640 billion dollars, I think I might prefer government programs over imperialistic military action, but maybe that's just me.

I am sure some of you don't believe it is fair that we should tax the rich and provide for the poor and I do agree with you. That being said, we have to tax somebody, and let's face it, you can't get blood from a stone. You have to tax the people with the money, because you don't get anything from taxing people without money. That being the case, taxes don't just pay for "wealth distribution programs" as some conservatives would like you to believe. Taxes pay for infrastructure, government operations, military forces, etc. and are necessary. Not only that, they should be paying for all of the interest that we are accruing every moment. I don't want higher taxes personally, but I do recognize that they are necessary. Lowering taxes is just putting a band-aid on a broken leg. It simply prolongs the problem, yet does nothing to make it better. Politicians love to talk about a balanced budget, but that just isn't' good enough. We actually need to make a lot more than we spend every year just to cover the interest, and that doesn't even begin to address lowering the principal.

Either way, this has become long winded enough. I am trying to make this all an educational and civil thread by providing simple information with my own personal analysis. I very much look forward to seeing what the opposition's take on this is.

4dmin
09-17-2008, 01:19 PM
excellent post Joe :cheers:

v-empire
09-17-2008, 01:19 PM
they dont understand.

you need to post pictures.

4dmin
09-17-2008, 01:33 PM
they dont understand.

you need to post pictures.

a lot of the people in this forum failed coloring so Economix 101 is asking a bit

http://www.ukdiscountvouchers.co.uk/images/colouring.jpg

blaknoize
09-17-2008, 03:10 PM
This is a great, very simplified post for anyone to understand. Great post.

JConner
09-17-2008, 04:10 PM
So what is Obama's plan for the corporate side?

source:Barackobama.com (http://www.barackobama.com/issues/economy/)

So, not only will small business owners be saving in personal taxes under the Obama plan, the will be saving significant amounts of corporate taxes because they are exempt from capital gains.

.


SMALL BUSINESSES DO NOT PAY CAPITAL GAINS TAXES!!!!!!!! You are obviously one of those that believe everything that comes out of Obama's mouth! This is just another example of Obama's economic inexperience.

joecoolfreak
09-17-2008, 04:19 PM
SMALL BUSINESSES DO NOT PAY CAPITAL GAINS TAXES!!!!!!!! You are obviously one of those that believe everything that comes out of Obama's mouth! This is just another example of Obama's economic inexperience.

You might want to meet my friend GOOGLE before you try and make yourself sound like you know what you are talking about:


In the United States, individuals and corporations pay income tax (http://en.wikipedia.org/wiki/Income_tax) on the net total of all their capital gains (http://en.wikipedia.org/wiki/Capital_gain) just as they do on other sorts of income.
source:wikipedia (http://en.wikipedia.org/wiki/Capital_gains_tax_in_the_United_States)
ALL entities, private and corporate pay capital gains taxes in the same way. That means that both small and large business pay currently. Maybe your economic experience needs a little tuning?

v-empire
09-17-2008, 04:20 PM
more pictures please.
thank you.

4dmin
09-17-2008, 04:24 PM
more pictures please.
thank you.

http://static.flickr.com/4/7942538_48903e3585.jpg

JConner
09-17-2008, 04:31 PM
Small businesses pay INCOME taxes not capital gains taxes. If they are paying captial gains taxes then they are probably no longer "small." Every s-corp, LLC, etc... reports their earnings as income and pay INCOME taxes! Obama wants to raise the taxes on the "rich" guess what? The rich are these business owners that report the profit from their business as income, so he is raising taxes on small businesses....not lowering them.

It would be rare for a small business to pay a capital gain tax...like if they sell a warehouse, etc and make a GAIN off of CAPITAL.

Total_Blender
09-17-2008, 04:36 PM
Reps!

No comment from the peanut gallery?

joecoolfreak
09-17-2008, 04:42 PM
Small or large business doesn't make a difference on whether or not it pays capital gains or not. All corporations pay can both capital and income taxes and they are completely separate. It depends on how the money was earned as to how it's taxed. Now, do all small businesses pay capital gains, of course not. Do all large corporations pay capital gains, nope there too. I agree that it is probably less likely that most small businesses pay a lot of capital gains taxes, but it is still a break to the ones that do.

Now to the fun part. ANY business owner that reports all of the profit from their business as their salary or income is a TERRIBLE business owner and deserves to be taxed at a higher rate. The whole point of incorporation, or LLC is to SEPARATE the business from the individual. If that individual takes every cent of profit and turns it into his/her income, then they are just bad at business. Not to mention the fact that they are also most likely losing all of the legal protections of their corporation because they are mixing personal and business money. And for the last and final time, he isn't raising taxes on small businesses, he is raising taxes on ANYONE who makes over 600k, that's it.

Alan®
09-17-2008, 05:09 PM
Obama is still going to cost small business owners money right here though


. Barack Obama and Joe Biden will expand the FMLA to cover businesses with 25 or more employees. Barack Obama and Joe Biden will expand the FMLA to cover more purposes as well, including allowing workers to take leave for elder care needs; allowing parents up to 24 hours of leave each year to participate in their children's academic activities at school; allowing leave to be taken for purposes of caring for individuals who reside in their home for 6 months or more; and expanding FMLA to cover leave for employees to address domestic violence and sexual assault.
Source:http://www.barackobama.com/issues/family/


I’ll also stand up for paid leave. Today, 78 percent of workers covered by FMLA don’t take leave because it isn’t paid. That’s just not fair. You shouldn’t be punished for getting sick or dealing with a family crisis. That’s why I’ll require employers to provide all of their workers with seven paid sick days a year
Source:http://www.inclusionist.org/node/1679

joecoolfreak
09-17-2008, 05:18 PM
And that's quite all right with me too. I see no problems with expanding FMLA either. I never said that everything is better with Obama. I didn't even say it would be cheaper. If you read my original post, I think his plan is flawed. I just think his opponents is much worse.

4dmin
09-17-2008, 05:59 PM
Obama is still going to cost small business owners money right here though


Source:http://www.barackobama.com/issues/family/


Source:http://www.inclusionist.org/node/1679

so you oppose FLMA? you must not work right? your parents pay all of your bills?

Alan®
09-17-2008, 06:22 PM
so you oppose FLMA? you must not work right? your parents pay all of your bills?
No I do not oppose FLMA. I work during the summer. Sorry Daddy doesn't pay all my bills :rolleyes: . My point is simply that this is going to effect and cost more small business more money. Not to mention this BS about 7 days paid leave being mandatory.

Vteckidd
09-18-2008, 10:55 AM
SMALL BUSINESSES DO NOT PAY CAPITAL GAINS TAXES!!!!!!!! You are obviously one of those that believe everything that comes out of Obama's mouth! This is just another example of Obama's economic inexperience.
+1 dont bother explaining they DONT GET IT.

joecoolfreak
09-18-2008, 11:09 AM
What I find interesting Mike is that after all that I post that is completely contradictory to EVERYTHING you have been saying lately and that is the one statement you choose to respond to and ignore everything else.

Total_Blender
09-18-2008, 11:10 AM
Most of the additions to FMLA are stuff that I already get from my job and I'm willing to bet many Americans already have. Pretty much any white collar job will give you 7 paid sick days.

BanginJimmy
09-18-2008, 11:43 AM
Most of the additions to FMLA are stuff that I already get from my job and I'm willing to bet many Americans already have. Pretty much any white collar job will give you 7 paid sick days.


dems hate white collar America, why else would they do their best to take as much away from them as possible.


I actually dont know of any blue clooar jobs that dont give you vacation and sick time. The only time in my life I didnt have sick/vacation time was when I first started a job. After a year, you get your sick and vacation time.

joecoolfreak
09-18-2008, 11:50 AM
Not all dem's hate white collar America. That's just a ridiculous statement. Do you think it's the blue collar workers that are paying for spots at a 29k a plate dinner for fund raising? There are just as many white collar democrats as there are republicans. I personally consider myself white collar and don't suffer from any form of self-loathing.

That being said, nobody is taking anything away from white collar in regards to FMLA or Paid sick leave. Obama simply wants to make those a requirement for all businesses, large or small.

tony
09-18-2008, 11:51 AM
dems hate white collar America, why else would they do their best to take as much away from them as possible.


I actually dont know of any blue clooar jobs that dont give you vacation and sick time. The only time in my life I didnt have sick/vacation time was when I first started a job. After a year, you get your sick and vacation time.

I have coworkers that had to fight the company to go to a relatives funeral, situations like this is why FMLA is important. Corporations do not always have the interest of the employee at heart.

japan4racing
09-18-2008, 12:07 PM
man this thread has really made me appreciate my job...i get 6 hours of annual leave and 4 hours of sick leave every 2 weeks!

as for the pic of the tax thing....you can interpret it 1 of 2 ways.

on the obama side it seems as though you get tax breaks for all the working class and big business pays the most taxes....this could mean a) more money in the working mans pocket or it could mean b) less money in the working mans pocket in the long run due to increased costs of goods becuase of the increased taxes on big business

on the mccain side it seems like you get tax decreases across the board with the working man getting very little break and the big business man getting huge breaks. this could mean a) the working man gets just as much pay as he does now and big business starts making a killing or b) big business can afford to drop prices so the working man gets more for his money.....not to mention with more tax breaks we can bring american jobs back to america.

imho with obamas idea we (working class) get some awesome breaks in the beginning and it will be a welcome site at first..but as time goes on you will see that is a bad idea. increased prices to make up for the taxes the big guys pay will eat up all of the "tax break" we just got and eventually put right back where we began.

with mccains idea i see a decrease in the cost of goods. now, the working class still pays basically the same amount of taxes but the cost of living decrease due to big business operating with less overhead. none of us will see this change immediately..but in the long run the economy will boost up from this type of tax structure. we may never get a fair tax in this country but mccain is about as close as we can get for now.

joecoolfreak
09-18-2008, 12:26 PM
Ok, maybe it's just me, but I think a lot of you are missing the point. First and foremost. Lowering taxes on businesses does NOT decrease prices. It has long been understood that they will just enjoy more profits. Reaganomics was not a successful fiscal policy. Second major point: DECREASING TAXES IS BAD. For anyone here it should be very easy to understand. If you spend more than you make and do it consistently, it will come back to haunt you. Everyone likes to think that if we have lower taxes, everyone will have more money and then stimulate the economy. That's great simple economics and if this occurred in a vacuum, it would be correct. We don't live in the world of simple economics right now. There are external factors that are coming into play. THE INCREASING DECLINE OF THE DOLLAR ISN'T GOING AWAY. The price of everything is going to continue to go up. Our economy is going to continue to have problems. Lowering the tax income of the country is only going to make this a bigger problem.

Now all of that aside, this thread was about personal taxes....not corporate taxes. Please do not confuse the tax table at the top of the thread with corporate taxes. It deals solely with personal taxes.

Dirty Octopus™
09-18-2008, 01:29 PM
Goodness gracious that was a great initial post!

you really shut a lot of people up! :eek:

like this thread was made yesterday and its only 2 pages because the Bamabashers are at a loss for words!
usually you have people that give elaborate explanations for why they disagree but no one in this thread has really responded with more than 2 lines worth of jargon

THAT is impressive :goodjob:

joecoolfreak
09-18-2008, 02:52 PM
Thanks, although that was not necessarily my intention. I simply don't understand the opposition's stance and so I put my own out there for debate.

Dirty Octopus™
09-18-2008, 03:28 PM
Thanks, although that was not necessarily my intention. I simply don't understand the opposition's stance and so I put my own out there for debate.
yeah i got that. but im just stating facts :D
but sadly this may very well be the last post in this thread.

flak_monkey
09-18-2008, 06:46 PM
Obama is still going to cost small business owners money right here though

You ever work for a small business that takes advantage of you? No paid leave? Not overtime? Unfair pay deductions? Illegally filing employees as subcontracters as a tax dodge? Cut hours after taking time off? Denied time off to deal with a family crisis? Forcing employees to pay for stolen merchandise from customer credit card fraud? I have. These things that Obama is asking for will force crook small business owners to respect their employees and help the little guy not get taken advantage of.

Alan®
09-18-2008, 06:56 PM
You ever work for a small business that takes advantage of you? No paid leave? Not overtime? Unfair pay deductions? Illegally filing employees as subcontracters as a tax dodge? Cut hours after taking time off? Denied time off to deal with a family crisis? Forcing employees to pay for stolen merchandise from customer credit card fraud? I have. These things that Obama is asking for will force crook small business owners to respect their employees and help the little guy not get taken advantage of.
Yup as a matter of fact I have. You know what I did? I left. And in my experience most of those are dead end jobs anyways.

blaknoize
09-18-2008, 07:54 PM
Yup as a matter of fact I have. You know what I did? I left. And in my experience most of those are dead end jobs anyways. Not all of us can just up leave dipsh!t. I was trapped at HP for 3 years with none of those benefits and due to the fact that I was uneducated I couldnt just leave. I had bills n sh!t, as I do now at another ****ty job. I never got overtime, I had to BATTLE with corp to allow me to leave when my grandmother hit the hospital due to a stroke. My pay never increased, it only decreased. Live on ur own first before u say stupid crap like that. Thats HIGHLY disrespectful.

So no, matter a fact u havent. Live on ur own and pay all of ur own bills and keep ur on life afloat. THEN u can speak on this subject.

DrivenMind
09-18-2008, 08:43 PM
And in my experience most of those are dead end jobs anyways.

Wouldn't that also depend on how motivated the employer was NOT to take advantage of you?

BanginJimmy
09-18-2008, 10:19 PM
No paid leave? No overtime?

overtime and paid vacation are not rights, they are benefits. It is called a benefit because not eveyone offers them.



Unfair pay deductions?

You are going to have to explain what you mean by this.


Illegally filing employees as subcontracters as a tax dodge?

Its illegal, and if you know your employer is doing that why did you take the job in the first place? I'll give you a hint, if you fill out a 10-99 form and not a w-4, you are being paid as a contractor, not an employee.



Cut hours after taking time off?

Again, need better explanation. Time off as in calling off, or time off as in scheduled? If you are calling off work, then its in the comployers best intrests to give someone that is more reliable more hours.


Denied time off to deal with a family crisis?

I can understand your pain on this one. I have been fortunate in that I havent delt with an employer that was inflexable with family emergencies.


Forcing employees to pay for stolen merchandise from customer credit card fraud?

If you dont follow SOPs for taking a credit cad, and it ends up being fraud, then the employer has a point. If you do, then he is actually committing a felony.


These things that Obama is asking for will force crook small business owners to respect their employees and help the little guy not get taken advantage of.

Obama's plan will simply force employers to give away money for nothing. I agree that certian portions of the FMLA need to be expanded, but not nearly to the point that Obama wants to extend them. In the end, this act will cause employers, especially small business owners to work harder to keep their payroll under 25.

joecoolfreak
09-18-2008, 10:32 PM
Jimmy, FMLA currently is only effective in businesses that employ 50 or more people. Don't you think that there are already businesses that try and keep under that mark for the same reason under the status quo. I don't see how changing the magic number from 50 to 25 is going to change how business are trying to skirt just under what ever the magic number is?

blaknoize
09-23-2008, 07:12 PM
Bump... cuz this thread will not be ignored.

BanginJimmy
09-23-2008, 08:24 PM
Jimmy, FMLA currently is only effective in businesses that employ 50 or more people. Don't you think that there are already businesses that try and keep under that mark for the same reason under the status quo. I don't see how changing the magic number from 50 to 25 is going to change how business are trying to skirt just under what ever the magic number is?


I realize that, but the question could be put the other way. If there are alraedy businesses making hiring choices to avoid the added burden of FMLA and the dozens of other govt forced programs, how is changing the number from 50 to 25 going to help. There is also the fact te the few employees a company has, the fewer people it can afford to have out of work at any time before it affects production.