Problem solved: Raise taxes on the rich, lower them for everyone else

[Onlooker]

The Democrats should propose a massive tax cut for the middle class and a even more massive tax increase for the wealthy (return to the Eisenhower era top bracket of 90%), including increasing capital gains for high wealth people and the restoration of the estate tax. If they did that, they would win the election hands down. While the tea baggers might have great sympathy for the wealthy, a big tax break for themselves will win them over. This would not only win the election, it would allow the middle class to reduce their debt and start spending again, which would boost the economy and lower the deficit.

[SKKY]

1. Well, that seems a bit extreme to me...

...but I think you increase the taxes on the rich proportionally to the decreas for everyone else. Or even double the rate for all I care. We live in a very different time than in the Eisenhower days, and 90% simply woudn't work. Capital gains and estate tax I'm with you on. Either way, the rich (Or job creators as they're called) have enjoyed the benefits of tax cuts designed to get them to create jobs, and they've failed miserably at that very thing.

[Onlooker]

4. 90% is not unreasonable

I think in the Eisenhower days, the 90% tax bracket only kicked in on income over $14,000,000. I think a case could be made for that, and people would be receptive if they were getting a tax cut.

[phleshdef]

7. Its also not the least bit necessary. I don't want to tax rich people just for shits and giggles.

I want to tax rich people more because its necessary. I want to tax rich people more because the country needs more money to function adequately and pay its bills and the rich people are the only place where we are going to find enough money to make that happen.

We should do things that are practical and make sense. We don't need to tax anyone at 90% in order to pay for the country. We definately need to tax them much higher than we are right now. But 90% is pretty excessive, and in this day and time that idea seems like nothing more than one born out of hatred for people who are wealthy. I don't want to tax rich people more to punish them or because I hate them. I want to tax rich people more because it makes mathematical sense. And the amount we hypothetically raise those taxes up to should also make mathematical sense.

[fujiyama]

13. Besides this isn't politically feasible in the least

This notion that we can return to 90% tax rates completely ignores reality.

Hell, we'd be lucky at this point to simply move marginal rates on the wealthy to what they were under Clinton.

[Hippo_Tron]

18. Nobody actually paid 90%, there were a ton of deductions

The effective rate was probably closer to 50%. Which is a hell of a lot more than the (I believe at this point less than 20%) that they actually pay because the capital gains rate is that low, now.

[blkmusclmachine]

2. Well, that WOULD interfere with drowning the Country in a bathtub,

so my guess it would be DOA in DC.

[CakeGrrl]

3. Do you honestly believe the Teabaggers in Congress REPRESENT the interest of the Teabag voter?

How did you get the notion that the likes of Cantor and the rest of that caucus really want to HELP these people?

They have them bamboozled into believing that all taxes are bad. Their 'base' is cheering on their efforts to protect the wealthy from taxes because all taxes are bad.

And McConnell is committed to upholding that concept in the Senate.

That you expect any sane, reasonable legislation to pass the House as it stands is, pardon me, naive.

[JoeyT]

11. Yeah, but it would serve to turn even more of the country against the Teahadists.

And I'm not sure that some of the rank and file teabaggers wouldn't be behind it: They're selfish assholes first and foremost. If we promised to cut their taxes in half, they'd probably agree to let us execute a random CEO a day on national television, as long as they got the tax cut.

[Recursion]

5. I say we should tie the top marginal rate to the national poverty rate

Whatever the poverty rate is, the top marginal rate is twice that. And base the brackets on the median income. That gives the rich an incentive for there to be fewer poor people and to raise the median income.

[LiberalFighter]

6. I think the idea needs to be a bit more clearer.

The post above is as if all income for a particular segment is taxed at one rate. That isn't how it is done.

Currently there are 6 different tax brackets on taxable income. Many people are under the impression that their tax on all income is based on which bracket their last dollar falls into. That is not the case. And the reason many people don't know the facts is because many don't do their own tax return. And the fact that the IRS makes it simple to figure out the tax for those that do do their own return.

The truth is that if one has income that qualifies a tax of 15% or more than their income is taxed at 2 or more rates. If they have enough income with their top dollar falling into the 15% rate then part of it would be taxed at 10% and the remainder at 15%. If they have income with their top dollar falling into the 25% tax bracket then the first part of the income is taxed 10%, income that falls into the 2nd bracket is taxed at 15%, and the remainder is taxed at 25%.

So everyone that has taxable income has either all or part of their income taxed at 10%. Even those making over $250k.

A married person filing jointly has the following:

10% -- 0         - $17,000
15% -- $ 17,000 - $ 69,000
25% -- $ 69,000 - $139,350
28% -- $139,350 - $212,300
33% -- $212,300 - $379,150
35% -- $379,150 - and above

Only the taxable income that is within that range is taxed at that rate. A taxpayer with $378,000 of taxable income would have income that is taxed at 5 different rates. The first $17,000 at 10%, the income between $17k and $69k at 15%, etc. So everyone with more than $17k of taxable income has income that is taxed at 10%.

Personally, I think there should be more tax brackets and reduce the increases from one bracket to the next. A 10% increase from 15% to 25% seems high considering that the other increases are 5% or less. Notice how it is only a 3% increase in the 4th bracket and only 2% in the 6th bracket?

[LiberalFighter]

8. The estate tax imo is not really a tax on the estate.

And shouldn't be considered as such. Rather, those that receive it should have it taxed as ordinary income at worst. I would support $100k of it as tax exempt but anything over that amount should be taxed as ordinary income. And only the states and federal government can tax it.

But if they want to keep it attached to the estate then the exemption should be lowered to about $500k or $750k.

The small business and family farm excuse doesn't wash. If the spouse is still living then the business or family farm passes directly to the spouse. And they own that part of the business or family farm that the deceased had owned. And it isn't until both husband and wife are deceased that other issues have to be considered. Even then, in the case of a family farm that have sons or others that also work the farm. Some argue that they helped make it what it is. That may be true but more than likely they were a partner and/or were paid to work the farm. If they were a partner then that portion that belong to the deceased is the only part of the estate that the IRS is concerned about when determining taxes. The part(s) that belong to those still living is not included in the estate. As for those that were not partners if any but still worked the farm. They were paid for their labor.

Now I can see there being a slightly higher exemption but I wonder if it is really needed if a proper assessment of the farm is done and all appropriate expenses are deducted?

Personally, I think the family farm excuse is all a lie. My father was involved in the farming community for over 50 years. And during that time he never knew of any family losing their farm because of the estate tax.

[PragmaticLiberal]

9. With all due respect, 90% is just ridiculous.

Unlike many DUers, I don't "hate" rich people.


I'd be perfectly satisfied with the 3% increase thats been proposed.

[Onlooker]

12. It's not ridiculous

In the liberal era, we had consistently strong economies, and the tax system worked like this:

Wealthy people paid an enormous tax on income, but basically if they chose a lifestyle that cost under $10 million/year, their taxes would get progressively lower. (Perhaps if we implemented this today, we cut up the top bracket to $20 million/year.)

If they invested more of more of their money, they could avoid paying taxes, in the hope that a more conservative government came along. And, economically, we've had one since the 1980s.

The progressive tax system basically provides strong incentives for wealthy people to keep investing.

Also, this is not at all about hating rich people. In fact, that comment makes you sound like a troll. This issue is about economic necessity. The reality is that Congress keeps spending more than it can afford, and we have to be pay the bills.

[bvar22]

10. If Obama proposed THAT,

he would become a National HERO,
and have an ARMY at his back.


...but it would upset the Republicans,
so its a NO GO.

[BumRushDaShow]

14. Money bills MUST originate in what is now a Teabagger-controlled House

yet half of DU must live in a alternate world with a different congress when thinking such a proposal would even be given the light of day from the repuke-controlled House committees... :crazy: And anything like that coming from the Senate will arrive in the House DOA. It would be a dream to have but we need the pukes gone to get there.

[shanti]

15. look

congress is mostly made up of millionaires. do we REALLY think they are going to raise taxes on themselves (and their friends)? hell no.

[Phx_Dem]

16. Horrible solution. The problem with emos is they hate rich people so much

they just want to punish them. They aren't looking for good ideas to help the economy, they're just looking for way to punish people who have more than they do.

Let the Bush tax cuts expire. That's fair. The middle class had had 2 (or is it 3?) tax cuts under Obama. We can't afford more tax cuts. We need revenue and we can get it by elminiating the Bush tax cuts and closing a few loopholes.

[Onlooker]

17. You've bought into a right wing meme

If you really believe that this discussion is about hatred of rich people then I really wonder if you even belong in a place like DU. What you said is just as bad as those right wingers who accuse liberals of wanting class warfare.

It's not about hating rich people at all. In fact many of the people who believe as I do are quite wealthy. It's a matter of making the economy work. We have bills; we have obligations; we have responsibilities: We have to start paying for them. The poor can't pay for them. The middle class can't pay for them. So, there is no choice but to turn to wealthy, and at the same time recognize that the wealthy are paying more because they benefit more from the economy.

[Dad Infinitum]

19. That is exactly what the GOP has been saying for years

'raising taxes = class warfare'

My, oh my.