One Last Huge Economic Argument For Obama About Which I'm Kidding Zero
You can change the world with your vote today. Not somewhere down the line, but the second it's counted. You can even change the world -- as long as you vote for Barack Obama -- whether he wins or not. That's how important your vote is.
I'm not talking about some horseshit about equality or peace. Your vote will be a signal that we're ready to raise the tax on capital gains.
McCain wants to cut the long-term capital gains tax to 7.5%. Under Obama, it will rise to 20%.
What will happen when they count your vote? If you voted for Obama, the people who expect to pay capital gains taxes will see where this is going, and sell the assets on which they expect to pay them. Now. Because right now the tax rate is 15%.
If you voted for McCain, they'll hold onto those assets, hoping to pay lower taxes on their sale sometime in the future, after McCain dies and Sarah Palin and Todd take over.
(A vote for Obama will send a signal whether he wins or not. It will tell congress that we were open to his policies. Before Todd has congress dissolved.)
A vote for Obama will increase the velocity of the economy. Rich people will sell and buy assets like it's going out of style. This is good for everyone. And they'll pay taxes on the sales, which will reduce this year's deficit, which now stands at eleven quintillion-bazillion-annjillian dollars.
If you vote for McCain, rich people will sit on their assets. (Haha! Get it?) And the economy will continue to just lie there like a special business extra playing a corpse on CSI.
I've always said, when it comes to encouraging economic activity, income taxes, especially when they discriminate against "unearned" income, taxes on capital-profits, death-duties and the like, are as relevant as the rate of interest; whilst the range of possible changes in fiscal policy may be greater, in expectation at least, than for the rate of interest itself.
And by "I" I mean "John Maynard Keynes." I just added "I've always said" so you'll like me better than him.
But I still haven't gotten to the best part.
The estate tax.
Barack Obama wants an inheritance tax of 45% on estates valued at more than $3.5 million. ($7 million for married couples.)
John McCain wants an inheritance tax of 15% with an individual exemption of $5 million. ($10 million for straight people who are allowed to marry the people they love and do. Sorry gay people, but it's your choice.)
Your vote will also send a powerful signal to these taxpayers. Point three percent of Americans. The hardworking super wealthy and their heirs. That message:
Lock in your savings at the current great, low-low-low Bush rates.
An offer this good can't last.
Murder your relatives now.
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This is hilarious! (as your writing usually is). It's too bad that it flew under the radar for most people because it was published on election day. It's still funny a week later considering Obama WAS selected.
What happened to the Dollar multiplier??? if you insert a dollar by paying an employee for example he takes that dollar to the corner store to buy something...the corner store then pays a grocery supplier with that same dollar that in turn pays the utility bill at it's wharehouse which helps pay the utility worker and further the cycle of that dollar.
So the $1 at the street level is effectively $5 as it changes hands and continues to multiply until it is out of circulation.
Give $1 to a wealthy individual and it sits in a fat bank account or worse an overseas tax hole...either way that $ is lost ,no multiplier effect. Business needs customers first!
Speaking of those very large numbers are we? Ages ago, an article in Scientific American spoke to those affairs in terms of our being "number numb". We simply do not have a context to understand such quantities within our normal everyday experiences. In order to get some grasp of even a low number in terms of federal budgeting like a billion try this: A billion seconds is equal to the time you live from birth until you are almost 32 years old. A trillion seconds is then 32,000 years. Equating some other numbers we should know like the amount added to the national debt by the W. regime is equivalent to handing out $5000 every second for 32 years. Thanks George!
And what about that kind of tax? The unseen, uncollected, yet looming kind of tax most are oblivious to. The last eight years of debt amounts to roughly a $25,000 tax imposed on 2/3 of the population by the recent Republican spendthrifts . It doesn't include the debt by the previous Reagan/Bush administrations of over $3 trillion. All tolled, $8 trillion out of our almost $11 trillion debt apportioned by the fiscal conservatives. You'll be out a tidy $120,000 per taxpayer by the time it is paid in full to our creditors. That's roughly $250 every month over an entire average working career. Thanks again Republicans. Who ever said Democrats are the "tax and spend" party, must have extreme difficulty discerning their anal orifice from a subterranean concavity.
STOP LYING, BOYS!
CAPITAL GAINS TAXES DO NOT APPLY TO THE SALE OF YOUR PRIMARY HOME.
This is a tax for those lucky enough to own multiple residences (like McCain) or have money coming in from investments.
For working folks -- IS IT FAIR to have capital gains taxes -- money earned on investments, no work required -- taxed at less than half the rate imposed on sombody struggling on minimum wage?
We have a few investments -- we're a long way from rich -- but I don't mind paying my share. The rich will always find ways to worm out of paying their share anyway.
I hope Obama wins big, despite all the GOP vote fraud in Virginia, Florida, Ohio... you name it.
hahahaha
Hilarious article. I liked it.
Funny thing though...a wealthy business owner/friend has already told us he will do some expansion as quick as he can if Obama becomes President so I think your on to something here! I don't know that he would have worried about it quite so much otherwise.
Chris,
Do you know anything about basic economics? Your posts suggest that you are winging it.
The sad part is that the minions on this site gobble it up like it was gospel.
Try reading economic literature. How is it that our economy has continued to grow with many more people becoming "rich" without the any of the current rich having had to give up their wealth up to this point?
Have you read anything about our economy for the last 8 years? The only people who appear to be taking things as gospel are you with the conservative talking points.
The economy for the last 8 year's has actually been pretty good. The exceptions are the 9 months after 9/11 which was planned during Clinton's presidency, and the last 6 months or so of 2008. Most of the collapse in 2008 can be pointed to the CRA pushed by democrats to pander to minority voters.
Beyond that, its been a very strong economic run. Anything better economically as an average than the past 8 years in terms of economic and job growth would basically be a "bubble" like we had in the 1990's under Clinton and would surely crash at some point.
Making rich people poor has never made poor people rich or even middle class.
Quite simply, the extra "wealth" comes from us, the wage-workers and home-owners. As the value of our jobs and homes goes inexorably down, our debts to the banks increase. WE are in hock, to back the loans, that secure the speculations, that "earn" the profits, that buy the rich their airplanes and seventh homes.
The "free" Capitalist system is an inverted funnel, making those at the wide bottom poorer, while those on the narrow top end sweep all of our money into their pockets. A truly "free" market (free of government regulation, that means) is a machine for making the rich richer, at the expense of the poor.
The answer to your question is that the poor are more poor now, than they were even in 2000, because their money has gone to perks for the top one percent.
Supply side voodoo economics is a proven failure. No matter how much $$$ you give to the wealthy and corporations (i.e., tax breaks) priming the pump from the top will fail everytime if the middle and bottom earners do not have spending capital to buy the goods and services that are produced. What I learned from Economics 101 was the the law of supply and demand drives the economy. No amount of supply alone, investments, research and new products, etc (SUPPLY) will be purchased by consumers who don't have the spending capital (DEMAND) to drive that type of economy. It is and always has been a two way street. So focusing solely on the supply side will fail everytime. These prior bubbles only existed b/c of BORROWING and could not be sustained in the lon run. Balancing between the two will yield a more stable and a growing economy. It's that simple. Jobs moving abroad means less spending capital here. Gov't tax policy has to find the happy medium and keep our own citizens employed with decent wages.
"A vote for Obama will increase the velocity of the economy. Rich people will sell and buy assets like it's going out of style. This is good for everyone. And they'll pay taxes on the sales, which will reduce this year's deficit, which now stands at eleven quintillion-bazillion-annjillian dollars."
Won't this cause a great decrease in asset values? You'll have desperate sellers trying to move quickly which would put downward pressure on the values of the underlying assets. Buyers are less likely to buy these assets, as they will become subject to the higher capital gains on their eventual sales, also pushing pricing down. How are almost universally decreased asset values "good for everyone"?
That being said, I already voted for Obama, so does anyone want to buy my stuff?
It must be nice to have so much faith in our Government to do the right thing with the money they steal from working Americans.
I am sick to death of this tired "soak the rich" insanity that permeates every corner of this web site.
You are just wrong man!
Heavily duped and totally wrong.
Paying taxes has never been OK as far as I've ever been concerned but we have no choice under penalty of incarceration.
Do a quick rundown of how OUR Government spends OUR money and then tell me if you think it's a good deal.
I think if you're smart you'll sing a different tune.
Do you like good roads? Do you like a vital military to protect our country? Do you like functioning police and fire departments? Do you like clean water, clean air, a functioning infrastructure? Do you think that absolutely no Government sponsored research program has paid big dividends to the American economy in general?
Sit down,... shut up,... and pay your friggin' taxes Emmory. Rail at the stupid crap which Congress enacts wasting some of that money, and which a President signs into law,.... Bitch and moan when they do it. Vote against the bastards that do it,... even initiate a recall election if such is available under your state or local law.
But unless you really do want to pay for your own roads, infrastructure, military and public services as you go,.... paying your taxes is OK,.. and it's Patriotic.
WEE I'M A PATRIOT!
Do you like good roads, like the New York State Thruway, Toll after toll after toll. Do you like a vital mititary ot protect our country, committing suicide at a record rate, and being told by (BWI) Blackwater Inc., to put on fat to get throw out of the military so they can work for Blackwater without worry of who or how many they kill. Do you like clean water that the government lost during Katrina, clean air that is causing structural damage across the northeast, functioning infrasture like the Bridge that Bush just rebuilt, that just fell down, Government research like Black and Syphlis or the Nevada Nuclear Bomb testing using G.I.'s, Recall call a Federal Elected Official or even get an Impeachment, it's like the energized bunny, keep paying and paying and paying, WEE I'm a Patriot!
I get roads to drive on, police and fire services, the world's best military (though we spend way too much on it) assurance that heat, water, electricity, cable, and phone will be available to me nearly anywhere I choose to live, a welfare system that nearly ensures that there's a safety net instead of people starving to death on my doorstep (or trying to break in to steal my food and money) a system that checks to make sure the drugs on the shelf are safe, the food I eat meets basic standards, and on and on. It's only since we started electing people who hate government (i.e. Regan) that things have gone downhill. Maybe instead of taxes, you'd like to pay for all these things yourself?
Personally, I think if you were smart, you'll sing a different tune.
TIRED OF THE SONG AND DANCE ROUTINE
I get roads to drive on compliments of "IKE" Republican, Police and Fire Services in rural America by Voluntary Fire Fighters and State Police, the worlds most misused and abused military in the world committing suicide at record rates, assurance of heat as long as Venezuela is suppling low cost fuel oil in parts of the northeast, water as long as Upstate New York is forced to pump it to New York City and Alabama is not drinking it during a major water crisis, and we are having record rates of home invasions, how many drug recalls and how many cuts in the inspectors, and on and on and on and on. No it's not about GOVERNMENT it's about a new government a (21st) Century Government, not a failed (18th) Century antique. Giving the Government for money to so less has been the SONG AND DANCE, for too long, you sing and dance I'll scream and put a boot up Governments backside, I want my money's worth or else.
I do pay for those things myself...
It's called taxes.
Plus, as for "soaking the rich", who benefits the most from the American system of government? Shouldn't you pay more if you get more? What's not logical about that?
One more great thing about raising Estate taxes: They encourage philanthropy. Many people would rather donate all their money to a charity of choice than have to give it to the government.
Exactly,... notice what Warren Buffett is doing with the bulk of his billions,....
Haven't even finished the post yet, but I had to weigh in and say "annjillian dollars" is PRICELESS (as, sadly, those dollars must also be)
Thanks Chris for being Chris
Hehe, I caught that too! nice reference
ha! I missed it on my first read-
May you accumulate "annjillian" dollars by the bucket, you deserve them for this great post.
Yeeee Haaaaww!!!
Doesn't the estate tax as it is expire in 2010? Krugman called it the 'throw mamma from the train' tax - as it certainly encourages doing the ol' gal in before the tax rate rises. Crazy, man, crazy.
That tax on capital gains is a tax on my house (and on just about everybody else who owns a house in America, or who rents from someone that owns a house.) Part of my plans for retiring were likely to include selling it and moving somewhere cheap, and now you want to raise taxes on that?
Financially, I suppose it would make sense for me to sell my house now, take the $500K/couple deduction before that goes away, and buy something new, so that Obama or his successors will catch me with a capital loss instead of a gain, but I happen to like where I'm living and don't want to have to move just because we elected somebody decent to replace Bush.
Take out a reverse mortgage if you actually do like where you are living, or pull the equity out with a new mortgage prior to selling the house. Either will let you skate on capital gains.
except that it doesn't apply to your primary residence. So there goes that theory. Unless you have multiple homes, it won't apply to you at all.
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