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October 31, 2014

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Letter to the editor:

Raising taxes on anyone isn’t fair

Another view?

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There is wide belief from our president to most who voted for him that raising taxes on so-called rich people (those who earn more than $250,000) would bring about economic recovery and the ship would be headed for clear sailing.

Some believe the economy boomed when President Bill Clinton raised the top tax rate. And as Jim Riley pointed out in his recent letter, Republicans will never vote to raise the top tax rate because “greedy anti-tax millionaires are their biggest campaign contributors.”

As a retired federal employee whose pension is less than $100,000, I along with those “greedy millionaires” do not want to raise taxes on anyone. Those greedy millionaires currently pay for the largest chunk of the taxes already.

Our national deficit during the past four years has been more than $1 trillion per year, and the Congressional Budget Office says the next four years will continue in the same manner.

Let’s say we raise the taxes on the greedy millionaires. This will increase the tax revenue less than $100 billion per year. We then still need more than $900 billion to balance the budget.

We don’t have a taxing problem in this country; we have a spending problem. The government does not manage our money we send them very well.

Lastly, it was the dot-com boom of the 1990s, not President Clinton raising taxes, that made the economy soar.

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  1. I'll add my voice and similar opinions to yours letter writer. If taxes have to be raised, then do so on everyone not just one segment of the population, in particular those who are astute at business and tax laws. We're all in this together.

    The GOP has a fall back position for the president and democrats on the fiscal cliff negotiations. Keep the Bush2 payroll taxes' cut after January 1, 2013. See if President Obama and the Dems have their pens ready to approve it. This helps the middle and working classes. Then, next year or whenever the President and Democrats are serious about talking meaningful cuts, they can get down to the business of the budget negotiations and scrub the politics.

    CarmineD

  2. "Let's say we raise the taxes on the greedy millionaires. This will increase the tax revenue less than $100 billion per year."

    OK let's do it! And, by the way, all millionaires are not greedy. Some contributors maintain we should not do this because it will not completely solve the deficit problem. But cutting off funding for Planned Parenthood, Public Broadcasting, and AMTRAK will not completely solve the problem either yet these same people will embrace those changes.

    Mr. Kreps maintains we don't have a revenue problem, only a spending problem. The truth is that both revenue and spending are the problem. There are two major problems we need to solve to fix the deficit:

    1. We need to reduce healthcare spending as a percentage of GDP from 18% (and growing) to 12%. Every other industrialized nation has a single payer plan and spends 12% of their GDP or less on healthcare, If we don't get rid of our private insurance system it is not only going to eat our lunch but our breakfast and dinner too.

    2. We need to reform our tax system so that it's designed to bring in the revenues the government needs to operate. Our current system is way too complex and designed to encourage certain economic activities, not produce revenue.

  3. We have allowed our government to foolishly spend money while keeping taxes too low. Now we have a debt that needs to be repaid. That cannot be accomplished without higher taxes. We don't have enough millionaires and billionaires to get all we need from them so taxes need to go up on all Americans that show an income.

    Health care costs are one of the biggest spending drivers so while I am not a huge fan of a government run single payer health care system, I think it is time we went to one. Hopefully, that would bring costs down and help us reduce debts and deficits.

    We have not paid attention to what our government was doing and so we have contributed to our problems and helped place us in the position to have to raise taxes and change our health care system. We may not like what has to be done, but we did have an opportunity to prevent it, and we didn't take it.

    Michael

  4. I strongly disagree with the letter writer regarding taxes. As a Canadian, my view is that taxes are necessary to bind a country together and create a fair and just society. The writer is correct, however, that taxing the wealthy will not by itself raise anywhere near enough money to balance the budget. Taxes should be raised on everyone in America and deductions/loopholes should be drastically lessened.
    I do vehemently agree with the writer that your government is grossly addicted to overspending. Now is the time to take an axe to all your programs including defence, entitlements, etc.
    Just ignore the legion of economists who warn that recession will engulf America if anything stronger than minor tinkering is done now.
    Americans, rich and poor, realize that the overspending has already gone on far too long. They are ready to be spanked personally so long as they believe that others are also sacrificing for the good of America.
    Either let the country go over the fiscal cliff or come up with an equally serious alternative compromise. To kick the can down the road or fool everyone with smoke and mirrors is simply too dangerous. You should all be demanding a fully balanced budget by 2015. I truly believe that the future viability of the USA depends on immediate fiscal responsibility.

    Donald Desaulniers (FromBellevilleCanada)

  5. Michael-

    I couldn't agree more with your 4:55 comment. We have had 10 tax years of the Bush tax cuts. Those tax cuts were paid for by the government borrowing the money for us and paying interest on it. Most didn't realize how high the deficits truly were. In most Bush years the Social Security trust fund was collecting $140-180 billion more than it was paying out. That temporary surplus made our true budget deficits look smaller than they really were. Many have forgotten that the Bush tax cuts were scheduled to expire in 2010 because it was known in 2003 that retiring baby boomers would eliminate the payroll tax surplus and require support from from general tax revenues.

    We need to rethink this fiscal cliff thing and maybe just go ahead and let it happen. So many of our fellow citizens have already experienced their own personal fiscal cliff. We can rest assured that if we go off the cliff there'll be plenty of folks already there to show us around.

  6. Enjoyed the letter, Mr. Kreps, but I don't understand the warped reasoning that since it is your belief that making the rich/filthy rich/obscenely rich pay their fair share of taxes will not help America...then that is some kind of excuse for not making them do anything at all and just...let everything go as it's going now.

    With this reasoning, we're back to where we started.

    I say this is a first step to fixing the American economy. Because already, even as we're typing this, there are moves afoot to fix the tax system in America and get rid of all the unnecessary loopholes. As well as other things.

    Anyways.... No matter what is said and done, one thing is a fact.

    On January 1, 2013, the Former President George W. Bush Jr. Tax Cuts For The Rich, The Filthy Rich, And The Obscenely Filthy Rich are coming to an end.

    It is without a doubt that, based on the last election, based on votes from both sides of the aisle as well as Independents, the American people want out from the predatory policies from the last Presidential Administration. Stuff that got us, and is still getting us, nowhere.

    We're moving on. And the rich are going to have to step up to the plate and produce.

    Call it a mandate, call it class warfare, call it unfair, call it you can't tax the "job creators," call it whatever you want, but the Americans out here have put their foot down and said to hell with this crap, we're changing it, and we want our President to do just that. And we want that to happen SOONEST.

    No more cover for the rich. And no more of this Tea/Republican Party running interference for them all the time. The American people have spoken. And they are STILL speaking.

  7. I agree with Michael.
    I would also like to point out that Michael might be part of the problem-- "As a retired federal employee whose pension is less than $100,000."
    Paying out large pensions to federal employees who put in 20 years of work will ultimately bankrupt our country. As more and more people go on the federal payroll, this problem will only get worse.

  8. The letter writer has stated that as a federal retired employee his pension is less than $100,000 a year.That is a very substantial amount of money to retire on.A vast segment of our population don't come close to making that kind of money in today's working world. It might have been better if he had not mentioned how much he recieves from his Gov.t pension.People may be scratching their heads wondering why they didn't take a job working for the gov.t, and get to enjoy such a generous pension.

  9. Until Obama presents a balanced plan with revenue enhancements and expenditure cuts the republicans should not do anything. They need to stop being intimidated by the polls and stick the leader of the free world with the responsibility to lead. The nation is almost equally divided over the solution to the problem. If a bargain is not struck before January 1 that's the way it goes. Let the blame fall where it will. Expect that we are going over the cliff. This is a game of chicken in which it is likely neither party will blink.

  10. Conventional wisdom is government during economic crisis becomes the spender of last resort and must spend more than it receives in revenue to prop up the economy. Had Bush 43 enacted a war surtax, the reasonable thing to do in these times, the economy would have tanked much sooner than 2007/8. As Mr. Kreps points out we spend too much. So in the short term we need to take a lesson from the Greeks, cut all levels of public payrolls and pensions 20% to 50%, that aught to do it. The again maybe not, but it is a start.

  11. One common sense approach to changing federal income tax law is to simply cap the total combined amount that a federal income tax payer can deduct. For example, if the non itemized "standard" deduction for a particular family is $15,000 then cap their itemized deductions at 2x or $30,000. This would include items such as home mortgage interest, property taxes and charitable deductions. Why should for example a wealthy person receive a 36% deduction for their contribution (subsidized by all other taxpayers) and the lower income person gets 15%? Maybe some taxpayers don't care to support any of these charities? Is the reason for giving the tax deduction or the need to give? Level the playing field for all and just cap the total deduction amount.

  12. The letter writer fails to factor in the lousy wealth distribution that exists in the United States. A fairly small minority of Americans own the vast majority of all the wealth that's in the nation. We are currently running neck and neck with Turkey and Chile in terms of our wealth distribution metrics.

    As Mr. Freeman correctly states our entitlement costs are completely unsustainable. The cost of healthcare needs to be brought under control. We will be spending something in the neighborhood of $200 trillion on medical in the next 40 years with the government getting stuck with the lion share through programs like Medicaid and Medicare.

    In terms of the debt who gives a damn? As I have stated on numerous occasions massive debts of this nature never get paid back. Individuals don't pay million-dollar hospital bills. Corporations don't pay off put billions of dollars in debts and governments around the world will never pay off the massive debts they are creating.

    The Las Vegas casino industry is sitting on $46 billion in debt. Are they paying it off? Not even close. Las Vegas Sands saw bump in its stock price by declaring a one-time dividend payable on December 18. Sands is sitting on vast amounts of debt and what are they doing? Giving billions to shareholders.

  13. Taxes should reflect the demands placed on government. Millions of people a year are signing up for various assistance programs. Millions are retiring and we will be paying for the Iraq Afghanistan wars for the next hundred years. We are currently sitting on some of the lowest tax rates in the nation's history when the demands placed on government have never been higher.

    This is what deficit spending is all about. Keeping taxes low and fulfilling the need for government services.

    Anyone who thinks this is a new concept needs to study history. It's been going on since George Washington. It took until the 1830s to pay for the Revolutionary war. What happened after they made the last Revolutionary war payment? The whole country collapsed into massive recession. Economies expand and contract with and without debt. Contractions are a natural part of the economic cycle. They correct speculative excesses in the aggregate.

  14. WRT Federal annual retirement amounts. The writer said UNDER $100,000. The operative word is UNDER. That can be anywhere from nothing to $100,000.

    Let's go with the $100,000. Here's how you get there. The letter writer, and I don't know him and can't speak for him, would have had to work at least 30 years [likely more]and be at least 55 years of age under the old Civil Service Retirement Syste [CSRS which went away to new Federal employees after 1985 except those already in the system who chose not to convert to FERS] or 62 under the Federal Employees Retirement System [FERS] for all Federal Employees after 1985, including Congress.

    In order to have a retirement BEFORE TAXES, [yes Federal pensions are taxable even though the original salaries paid to these Federal Employees were taxed already], the employee would have had to earn a base salary of over $200,000 a year for the highest 3 years of his/her career. Highly unlikely unless the employee is a seasoned Congressman or woman. Base salary means all premium pay for overtime and other incidentals are not included.

    More than likely at the upper end of the Federal employee pay scales, and these pay ranges are public information, to take home $70,000 per year in retirement, BEFORE TAXES, the employee would have had to earn about $150,000 per year. That's the top tier of the Federal Executive Service, a very small percentage of the government employee workforce.

    Even then, deductions have to made for health benefits and surviving spouse for about 10-15 percent per year taking the $70,000 down to $60,000 BEFORE TAXES. Again for 30 plus years of service and age 55-62 at retirement.

    Certainly a decent pension but not wealthy and exorbitant by today's standards.

    CarmineD

  15. BTW one of the attractive features of Federal government retirements is that they are usually adjusted based on inflation. It's called a COLA: Cost of Living Allowance. These are not guaranteed ANYMORE. In fact, in recent years under President Obama, were not paid. For 2013, probably because it was preceeded by an election year, I believe, and haven't checked, that the COLA to be paid is 2.3 percent. Compare that to the increases in goods and services that retirees need and use, and its does not keep pace with inflationary pressures and prices of today.

    CarmineD

  16. I agree with others that no serious changes can be made until the tax code is simplified and various deductions are either eliminated or restricted. Once that is done and it is possible to make a reasonable estimate of actual revenue then rates can be looked at.

    That said, there is one class of deductions that might need to be made somewhat more complcated: charitable donations.

    I think it would be a big mistake to eliminate this deduction. On the other hand, given the purpose of having it in the first place, I would entertain the proposal that it be allowed only for charities whose primary purpose is to benefit citizens of the United States.

    Similar considerations can be made in the case of the mortgage interest deduction: i.e. primary residence vs. income property.

  17. I have a different solution. Since SCOTUS has said that businesses are individuals when it comes to political contributions, let's take it the next step and eliminate the business tax rates and deductions. Since a business is an individual for political contributions, let's continue the process and tax them as individuals, and eliminate all business tax rates and deductions. Then, we won't have to raise taxes on anybody, except of course for businesses.

  18. Tanker1975,

    I truly hope you are writing in jest.

    It is bad enough that decisions such as Citizens United have helped take the legal fiction of "corporate personhood" to new levels of absurdity, but to actually further entrench that decision by relying upon it in the manner you suggest will make it almost impossible to ever return the concept to its proper place.

  19. Michael O. Kreps, of Las Vegas wrote in his article.

    "Republicans will never vote to raise the top tax rate because "greedy anti-tax millionaires are their biggest campaign contributors."(comment by Jim Riley)

    I agree, and would add, the Tea Party House Republicans do not want to violate the Grover Norquist pledge of raising taxes.

    Two things will happen early next year, 2013.
    (1)The House Republicans will vote to extend the Bush Tax for 98% of Americans.
    (2)President Obama will use Executive Privilege to resolve any disagreement in raising the debt ceiling if House Republicans signal a refusal to do so.

    There will be no agreement on the so called Fiscal Cliff this year. The House Republicans will wait until next year, after the Bush Tax Cuts expire at 12:01(est.)on January 1, 2013, to pass the tax cuts for 98% of Americans. This will take place within 5-days after January 1, 2013. In addition, the House Republicans will sign an agreement ensuring tax certainty, for 1-year, for the wealthy 2% Americans.

    The next hurdle will be the debt ceiling debate. This should not be a debate...Pay what we owe! Look for the White House to be assertive in using Executive Privilege to resolve raising the debt ceiling if the House Republicans try again to stop the US government from paying the bills.

  20. Longtimevegan,

    I wish the "debt ceiling" was nothing more than a matter of paying what we owe, I would be with you on that. But it is really a matter of saying how big a deficit we will run.

    Many have said that a country can operate by a different set of financial rules than a household, or even a major corporation, go by because a government can print the money it needs or even create it out of thin air by fiat. I say that at some point the people making loans will say the money is no good.

    Also, I might be wrong, but the Constitution's clause about all appropriation measures originating in the House might get in the way of the Executive Orders that you think might be issued. In fact, I think Bernake's QE programs might be questionable in that light. (And can anyone say those are not "trickle-down economics" on a truly massive scale?)

  21. Karl Marx would be pleased to know that he has so many devoted followers today. :(

  22. When do we do something about tax havens?

    http://www.businessinsider.com/inequalit...

  23. Tis true that we can increase our standard of living without increases in pay, without inflation, without tax increases, without taking on social welfare for the rest of the world, for illegals, for those who refuse to support themselves and their children. Step one: STOP SPENDING more than revenues. Get a REALISTIC BUDGET that pays down the debt.

  24. Boftx,

    The reality, we are in a very bad economic situation. Washington politicians made bad decisions, and now they are running away fast, and blaming everyone but themselves. I hear many of them talking as if they are not in Washington. Like saying "the government is spending too much", and "I" will cut spending. The same old B.S., as if "they" had nothing to do with the conditions of the US economy.

    Raising the debt ceiling is a big issue. Probably a bigger issue than the Fiscal Cliff. The bills are there, we owe money to bondholders and other commitments. We have to pay. This is a stated reality. The President will do what it takes to pay our bills. The debt ceiling will be raised, either by House Republicans agreeing to raise the debt ceiling, or by the President using Executive Privilege.

  25. Comment removed by moderator. Inappropriate

  26. Longtimevegan,

    We can agree that we must pay our bills. Can we agree that it isn't prudent to be running up more when we are already borrowing about 40 cents of every dollar being spent?

    As I have said a number or times, any real solution begins with stopping the hemorrhaging of our resources due to ill-considered trade policies. I will also grant that our tax code is in sore need of an overhaul so that any sane, rational person with a high school education can understand it. (And let's avoid the question of whether or not our school is even capable of producing such a person anymore for now.)

  27. A little research on Ike Eisenhower might help some understand why higher taxes for the wealthiest were necessary to build our infrastructure, which happens to be falling apart as I write this.