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Internet Sales Tax Vote This Week In US Senate
SonicSpike excerpts from CNet's coverage of the latest in the seemingly inevitable path toward consistently applied Internet sales taxes for U.S citizens: "Internet tax supporters are hoping that a vote in the U.S. Senate as early as today will finally give them enough political leverage to require Americans to pay sales taxes when shopping online. Sens. Mike Enzi (R-Wy.) and Dick Durbin (D-Ill.) are expected to offer an amendment to a Democratic budget resolution this week that, by allowing states to 'collect taxes on remote sales,' is intended to usher in the first national Internet sales tax." There goes one of the best ways to vote with your dollars.
OH wait amazon already charges me taxes.. So who cares?
But since you were obviously motivated by the need to make a statement, rather than say just being a cheapskate, I assume that will not be a problem.
If the tax crosses state borders, then it should be collected by the Feds - or at least the rules should be national and consistent. Collect, say, 5% from everyone and then distribute it according to billing address. Making merchants deal with 50 different tax codes is onerous. I hope this bill is defeated.
W..w..W - Willy Waterloo washes Warren Wiggins who is washing Waldo Woo.
I guess we will just have to torrent everything then. Does anyone know how to torrent shoes? I would if I could.
Congress can't seem to balance the budget but they sure can spend time figuring out how to collect taxes more easily.
Taxes... Is there anything they can't solve? We obviously need MORE of them!
It's an amendment to a concurrent resolution. IF the amendment were adopted and IF the concurrent resolution were adopted by the Senate and IF the House adopted the concurrent resolution (which is very unlikely), then it would not have the force of law because, after all, it's just a resolution.
I'd be OK with sales tax on on-line sales, on one condition: states be required to provide a standard way for merchants, at no cost to the merchant, to ask what the sales tax rate for a given address should be, with the answer being the legally binding rate (if the merchant charges the rate given in that answer then the merchant cannot be held liable if that rate turns out to be wrong, and if the service failed to answer for any reason then the merchant can't be held liable for failing to charge sales tax).
but I hardly think that an amendment to a provisioning bill passes sufficient legal muster for it be enforced. First of all, I am already required to pay local and state sales taxes for entities operating out of my state. So no change there.
But for extra-state sales, this will have to survive a 10th Amendment challenge and well settled legal precedence dating back to the 18th century. Not saying that it can't but a short blurb in a different, unrelated law doesn't seem sufficient on its face.
For an "internet sales" (whatever that means) tax to work, it would have to be established as something the feds collected and redistributed. The legal authority is already there in the 16th amendment, and it could easily function as interstate funding for roads and schools do currently.
Likewise, if two states wanted to enter into a compact to collect and remit as some currently do with income taxes, then that could also work.
I guess this is just some more busywork for the congress-critters to say that they've been doing something rather than nothing.
Umm, wasn't it techncially a "representation" revolt? Taxes are needed to pay for the services that are provided. Taxation without political power in return is what was the cause of the revolt.
There goes one of the best ways to vote with your dollars.
I can still make political campaign donations to my heart's content. That's what you mean by "vote with your dollars", right? Right?
"If a nation expects to be ignorant and free in a state of civilization, it expects what never was and never will be."
Seems like it would be a lot simpler for everyone to implement a tax at the credit card level. It would work for all retailers and eliminate a lot of sales tax withholdings at various companies.
That we really need to close this loop hole. I'm not in favor of raising taxes or anything, but by making this law, we'd be going back to a revenue model that we know. The ripple effect would be we wouldn't get tax hikes in other places I'd imagine.
And the government does need the money... it would be nice to see them get it internally, but that's idealism. We need pot holes fixed, bridges replaced, and maybe we could throw money at some of the issues we're behind the rest of the world on.
Another ripple would be brick and mortar stores would regain some traction against online retailers, the argument used to be that shipping > tax, but that's dramatically changed over the last decade with free shipping being pretty easy to get as online firms compete against each other.
The downside is of course less money for the savvy consumer, but history has taught us loop holes never end well, so I think the benefits outweigh the downside.
Umm, wasn't it techncially a "representation" revolt? Taxes are needed to pay for the services that are provided. Taxation without political power in return is what was the cause of the revolt.
Yep, exactly. Which makes it even more relevant to the present case, not less.
"None can love freedom heartily, but good men; the rest love not freedom, but license." --John Milton
Technically yes – but the rabble rousing was anti-tax.
No one LIKES to pay taxes, but everyone likes paved roads and healthcare. (Canadian here, btw, also too lazy to log into account). I see no real harm in a minimalist approach to some sales tax on orders placed out of province/state that wouldn't be taxed otherwise. In Canada, we pay sales tax on just about everything ordered online, unless out of country of course.
The complications of the matter are a bit different, yes. Hopefully you would just have one place to send it, but with how over complicated and redundant 90% of your laws are already I would find it unlikely you can make even this...intelligent? tax system worth while.
Good luck with it though.
This is a State decision, not a Federal one.
If you'll check a history book, you'll find the rallying cry was not "No Taxation" but rather "No Taxation Without Representation". Huge difference.
You may have to wait a little longer, but people will start buying from Canada or other places without taxes.
love is just extroverted narcissism
As it will cover all Ebay sales and Craigslist sales.
They want to charge you tax on even items you are not making money off of. Next up, Evil Garage sales and Flea Markets, how can we tax this scourge to the economy?
Do not look at laser with remaining good eye.
But aside form DC we all have reprint action in the senate. While we don't have control over individual issues, we can vote out the bastards if we don't like them.
If you'll check a history book, you'll find the rallying cry was not "No Taxation" but rather "No Taxation Without Representation". Huge difference.
"Taxation without Representation is Tyranny" was the cry. Freedom, not freeloading.
Hows this going to work out in Oregon where they do not have sales taxes ? they going to make all the internet retailers collect taxes for the other 49 states? LOL going to work out just fine.
Given that companies and states have already settled into thinking "The internet doesn't have state sales tax unless it happens to be an intra-state sale," I can quickly see a few business-hungry states amending their tax codes to exempt interstate sales. Based on the way I read this, this would allow companies to continue distributing the same as they always have (no sales tax unless you live next door to us), and if few enough states implement it, it could be a serious economic turning point as businesses flee to those states.
bullshit, it wasn't a tax revolt, it was a representation revolt.
The quote isn't "No Taxation",
The quote is "No taxation, without representation".
If you'll check a history book, you'll find the rallying cry was not "No Taxation" but rather "No Taxation Without Representation". Huge difference.
Yes, taxation without representation was cheaper.
Taking guns away from the 99% gives the 1% 100% of the power.
"No Tax or Duty shall be laid on Articles exported from any State." - Article 1, US Constitution.
It seems to me, that any such legislation would be a tax being exported from one state to another. I don't believe a distinction can be made from those being exported and those being imported, since it is only matter of perspective. A tax on imports to a state is a tax on the same article being exported from another. There is no limit to the prohibition. It could also read: "All taxes and duties are prohibited on all articles being exported from any State."
Slashdot's rate-of-post filter: Preventing you from posting too many great ideas at once.
this will affect the average american WAY more than drones ever will
Another issue is the ushering in of tracking bots at the ISP level. In order for them to be able to tell if you bought something, they will have your ISP track your every move (or click) to see if your are buying something or not. Either that or they insist that everyone selling anything on the internet record everything and provide records (from worldwide locations too, which they don't have jurisdiction over), or they insist that people volunteer information about what you bought at www.1-900-hot.girlz.com. Clearly having a sales tax would raise more questions than answers. I personally don't think it's a good idea. I thought Americans didn't like taxes (or at least revolted against them more than other nationalities).
But aside form DC we all have reprint action in the senate. While we don't have control over individual issues, we can vote out the bastards if we don't like them.
... every 2-4 years... only to replace them with other bastards from a remarkably small pool.
An enigma, wrapped in a riddle, shrouded in bacon and cheese
I live in Washington state, so almost everything I buy online gets taxed if I send it here. Services I guess not as much.
So would I have to pay more taxes? Fuck off if that's the case. You need more money Federal Gov? Stop wasting it.
Be seeing you...
I don't understand why the state that I live in should get any sales tax from an item purchased in another state.
If I walk across the state line and make the purchase, should the state I live in get the money? If so ... why? If not ... how is it different from purchasing online?
I honestly am not against sales tax, but I think the state in which the purchase is made is the one that should collect the tax. Keep the money where the business is located/operating rather than collecting it in a location that had nothing to do with the sale.
False equvalency, rationalization, and misinterpreting the constitution? Sounds like you must have a really compelling argument there!
There's no -1 for "I don't get it."
The library called, you really need to return that copy of Atlas Shrugged.
The 'no sales tax' scenario is generally enticement to commit tax fraud.
Usually, a 'no sales tax' purchase has an obligation to pay a 'use tax' equal to the amount the sales tax would have been. People saving money due to sales tax are almost always committing tax fraud.
So this isn't levelling by force, it's correcting a 'loophole'. In my mind, abolish use tax, if you *must* enact sales tax to do that, oh well, it's easier than sales tax to keep track of.
XML is like violence. If it doesn't solve the problem, use more.
Does that mean the IRS will aggregate all your sales of used and stolen stuff and tack it on to your tax bill??!!
the government gives billions and billions in tax breaks to extremely rich companies that don't need it, but anytime their is some perceived tax breaks for families they go out of their way to squeeze the nickel out of those who are the least able to afford it.
It doesn't make it relevant at all. The proposed law will just make it easier for States to collect their already existing sales taxes for online purchases. If you don't like the sales tax in your State you're free to move to one with a lower tax or to vote for State representatives/senators who will change it.
The knee jerk reactions here are amusing sometimes.
Changing the constitution on-the-fly.
Such a dynamic document!
If it is passed and it meets the criteria of being uniform, then it is a Constitutional tax, I cannot say anything about it.
Your religious leader will give you something to say about it afterwards, and you will go back on your word once his word comes down. Unless, of course, he shows you an easy way for people of high incomes to avoid it altogether - in which case you will claim it was an idea stolen from his notes.
You seem to be quite proud of yourself this week, we see you recently managed to get both the karma of your main account as well as that of one of your sock puppets from shit to positive, allowing you to post nearly as fast as you can type. How many other sock puppets are you working here? Did one of them manage to get mod points to get the ball rolling for you? We can plainly see you have already allowed this to get to your head; you may have posted a couple of legitimate comments to get your karma back up but now you're right back to religious rhetoric.
Of course, to you the religion is the truth, the only truth. You will do everything you can to push your church's agenda, in spite of the fact that it would hurt you just as badly as anyone else. You proudly drink the kool-aid and hope that you will - in spite of all reason - be spared the effects of the agenda. You seek to oppress the rights and opportunities of those who are in the bottom 99% of all wage earners; you have an agenda that supports fascism. You claim to want liberty, but you really want fascism for the people.
It's every 6 years for each senator, with a subset of them up for re-election every 2 years.
I can barely stand to read slashdot any more. What happened to the simple days of tech innovation, before the politicians got all mixed up in it? The state of our society and the obvious and flagrant abuses of power that happen every day make me blindingly irate. Which is a more elegant way of saying what I'm really feeling: I'M SO FUCKING MAD AT ALL THE MONEY-GRUBBING POWER-HUNGRY PIECES OF SHIT THAT KEEP WALKING ALL OVER US! Thanks, I feel better now (kind of).
from a logical point of view, sure, it is a matter of perspective, but in actual implementation, it can definitely be one or the other.
I see what you did there... you made specific claims which you opted not to substantiate... care to try again?
Help Brendan pay off his student loans
Figure out some way to disburse to states based on shipping address. As posters have noted, there's not a current way consistent with the Constitution to charge state tax on interstate commerce.
I swear to God...I swear to God! That is NOT how you treat your human!
They are already short circuiting the Constitution now, Ever hear of the 4th Amendment free zones ,
http :/ / www.zerohedge.com/news/2013-02-09/goodbye-fourth-amendment-homeland-security-affirms-suspicionless-confiscation-device
Tax is tax, inflation is a consequence of fiat money. The Fed may affect inflation but it doesn't control it.
That article would only apply if this were an export/import tax. Instead this tax is on the transaction itself, regardless of the origin of the goods.
Folks are just going to drop-ship to sales-tax free states by having a friend or relative there order for them.
...this country was founded on a Tax Revolt?
As an observation, if you get it here, you don't get it elsewhere. It's give and take. But, for the Gooberment...it's all pretty much take, take take- unless they can buy your vote with a pittance of the take they're taking from you...
Yeah, that nasty, evil Government that doesn't do anything for you. How dare they ask for money to pay for the expenses of government!
Printing money is not a tax, and inflation is a symptom of private enterprise becoming desensitized to the availability of money.
The government specifies an authorized agent (the Fed) to handle its debts. It does this by sovereign force. The agent must then print debt notes (dollars) that the government may then spend. These debt notes mean that the government is indebted to you by the face value. They're an IOU. As you collect these things and go about your daily life, you use government services (military protection, Social Security, roads, whatever), and the government bills you for those services in the form of taxation. You hand in some of the IOU's, forgiving that much of the government's debt, and the lifecycle of a dollar is complete. The dollar's value is essentially destroyed, as the government cannot be indebted to itself. They then "print more" (as you put it) and repeat the process.
There is a word for this. It's a novel idea called an "economy". Just because you trade those IOU's in an increasingly unfavorable manner with other people does not mean that inflation is a tax created by the government. Now if you're a government contractor, then you ARE part of the problem.
Well, what did anyone expect? The US government needs money, badly. They will reach out to any and all ways of acquiring more money. They will then immediately spend all the money to obtain more votes for themselves, then borrow against the future income and spend that too. A Republic fails when the uneducated masses learn that they can vote themselves money from the public treasury and that politicians will gladly follow along, even when such a path will certainly lead to their own deaths.
Shutting down free speech with violence isn't fighting fascism. It IS fascism!
Who gets the tax? The fed or state(s)?
Who collects the tax? The location of the buyer, the location of the seller, the shipping warehouse or the server making the transaction (actual point of sale)?
I like your interpretation. Where can I subscribe?
The only way I will accept a tax is if it's a direct taxation towards making it as public utility.
The Fed may affect inflation but it doesn't control it.
- the Fed creates inflation, as to 'controlling' it, it does somewhat. When the Fed creates fake credit to buy Treasuries and mortgages, the very first place that the money ends up in is the bond and the housing market. In fact Bernanke is on the record, talking about the need to 'prop up housing'. He wants house prices to go higher, because obviously it's so much better if things cost more. What he really ends up doing is creating inflation and in response prices of everything else go up together with the house prices (which need to go down, by the way, not up, there is no reason why house prices should be going higher, the market needs the house prices to fall further).
But you are right, the Fed can't control inflation. Bernanke says he has a '2% target', while the reality is that the real rate of inflation is easily 4-5 times higher than that right now at any moment in time. He can't actually control the rate at which inflation shows up in different markets. He can flood the Treasury and housing markets with money but he can't control how quickly money moves out of those markets.
However here is what we do know: you can't really inflate the same bubble twice in a row, so while he is really trying, he won't be able to create an absurd housing bubble right now, but he is propping up house prices. However we also know that Treasuries have maturity date.
That's the thing, Clinton with Rubin refinanced US mortgage (debt) with short term, adjustable rate paper, they went away from 30, 20 even 10 years Treasuries, those are now on the Fed's balance sheet (operation Twist, remember?). The other debt holders have short term paper which matures once every 3 or 2 or 1 year or maybe even 6 months! So when the talking heads on TV say: it's very cheap to borrow, so we should borrow more and more, what they don't understand is that it's cheap to borrow NOW.
So you are going to end up loaded with debt and all of a sudden the people stop rolling these things over (and the Fed is the only buyer of new Treasuries at this point as is), and what happens to interest rates all of a sudden?
Read my sig, the US government can pay the interest on its debt right now, when it's at historic lows. What happens 6 months from now, 1 year from now? We know that the debt will be higher, but will the bond holders roll their holdings over again or will they sell? (and really, they can sell at any moment, but even if they hold it until maturity it doesn't really make much of a difference when it's 1 year or 2 years term paper).
What happens is that all of a sudden instead of 300 Billion USA has to pay 1 or maybe 2 Trillion in INTEREST PAYMENTS and maybe even more than that, but that's about how much the federal gov't collects in revenues today. So what happens at that time, when they can't collect more revenue and they can't borrow any more money because people are selling in bulk?
Where will the interest rates go, how high? Will the US gov't even have enough revenue in a year to pay the interest? If 100% (or more) of revenues go towards interest payments, how can the gov't exist?
What is happening in Cyprus right now can happen in USA, because all of the big banks in USA are bankrupt the moment interest rate goes over 2-3%. So your deposits are at risk, never mind your government operations, because the banks will immediately fail (the people won't be able to afford their loan payments to the bank and the banks will have negative equity, as all of those Treasuries that the banks hold for the 2-3% return all of a sudden fall through the floor in price).
What is going to happen is going to be horrific. When I say it, I see it the same way as when I was talking about the Iraq war being a mistake because Saddam had nothing to do with 9/11 and had no WMDs, people didn't want to understand. Same thing is going to happen here.
You can't handle the truth.
Another example of the government closing tax loopholes for the common man, but they still won't close the ones that corporations are using.
What do I know, I'm just an idiot, right?
Um no. freeloaders have not come anywhere near 50% of the voters. The so called 47% contains large blocks of people who are not freeloaders.
1. About 60% of those not paying federal income taxes pay other federal taxes such as SS and Medicare. Not to mention local taxes such as property taxes and sales taxes.
2. Wealthy people whose income comes from tax free bonds pay no federal income taxes. However they pay other local taxes on property etc.
3. About 20% of the 47% are retired elderly people who have paid a lifetime of SS and Medicare taxes.
Finally a significant proportion of these people vote for Republicans. Various polls show that above 50% of the elderly vote Republican, and about 1/3 of the people who are exempt from federal income tax due to earning less than $24000 vote Republican.
So basically the idea that a majority of 'freeloading' Americans are going to perpetuate their situation by en-masse voting for progressive candidates is ridiculous bullshit. There isn't any such majority of freeloaders in the first place, and secondly the voting pattern of low income people is not as monolithic as you propose.
As it will cover all Ebay sales and Craigslist sales.
They want to charge you tax on even items you are not making money off of. Next up, Evil Garage sales and Flea Markets, how can we tax this scourge to the economy?
Ebay yes. Craigslist no. Craigslist does not make sales, the people interacting directly do, and the overwhelming majority of these are local.
Make sure everyone's vote counts: Verified Voting
I guess I'll have to vote with my Euros.
Renminbi?
Have gnu, will travel.
Hey anyone old enough to remember "modem taxes?" Governments have been looking for ways to tax online activity for years. When I was in college, someone proposed a "stamp" fee for every email sent. Then there were micro charges on a per-packet basis. Ugh!
At least a sales tax is easily added to existing point of sale portals. With the amount of free shipping available to me, the slight increase in cost will not deter me from making online purchases.
A few more thoughts:
I'd prefer paying state sales taxes over federal sales taxes, since I'm pretty sure state sales taxes won't go to stupid things like foreign aid to France.
While I know this won't be used to balance the Federal budget (no one can do that), I think this is a test bed for a national sales tax. Question is, what will this partially fund? It certainly won't be used to pay down out growing debt! That's just crazy non-partisan independent thinking at work!
Only the dead have seen the end of War. - Plato
I mean, do they just tax based on destination state, regardless of the buyer? Or is the wording wrong, and they really only mean people who are *IN* America?
File under 'M' for 'Manic ranting'
The Supreme Court disagrees with you. See QUILL CORP. v. HEITKAMP, 504 U.S. 298
In a nutshell, they found a state cannot force a company outside its borders to collect a sales tax under the commerce clause as interpreted in 1992. However, "The underlying issue here is one that Congress may be better qualified to resolve, and one that it has the ultimate power to resolve."
Furthermore, Article 1, Section 8 of the US Constitution states "The Congress shall have Power" ... [skip a few powers] ... "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes."
Congress does have the power to require that a Merchant in State A charge State B's Taxes to customers in State B. The line you quoted from Article 1, Section 9 looks to prohibit them from charging federal taxes.
I vote neigh!
Interesting that Congress is focusing on tax loop holes that individuals take advantage of while leaving in place loop holes that allow corporations to hide hundreds of billions of dollars in tax havens. Equally interesting is that all these states that are groveling for additional revenue grant egregious tax breaks to said corporations in the hopes of luring their facilities for fleeting benefit until the inevitable better deal comes along. Who does Congress represent again?
If a nation expects to be ignorant and free, in a state of civilization, it expects what never was and never will be-T J
Yeah there is already Use Tax where your home state charges you for stuff you buy outside of the state.
While congress may have the power to regulate commerce, any revision to "No Tax or duty shall be laid" would require a constitutional amendment in addition to what ever legislation congress enacts.All acts of congress are subordinate to the constitution, and where they disagree, the constitution wins.
Slashdot's rate-of-post filter: Preventing you from posting too many great ideas at once.
When I go to a brick and mortar, I pay sales tax based on the address of that store (not my own). For fair taxing, both brick and mortar and online stores need to follow the same rules.
There is another consideration, though. I often make purchases which won't be used at my residence. I purchased a mouse to use at work (the company won't provide a mouse because the laptop has a touch pad) which is in a different county. I purchase presents for friends and family not only in different states, but also different countries.
He just keeps finding ways to pick taxpayers' pockets and shred civil rights. Illinois' second biggest contribution to the decay and corruption of the fedgov.
Once the freeloaders exceed 50% of the vote ... they will simply use the power of the government ... to steal from the rest of the productive population.
We're in no danger of that, because there's nothing true about that sentence:
1. Only 17% of households pay no income and no payroll tax. As soon as you factor in Social Security and Medicare, there are very few freeloaders.
2. Of those 17%, nearly all pay sales taxes and/or property taxes to state and local governments, and many pay federal gasoline taxes, cigarette taxes, and other federal sales taxes. In other words, they aren't freeloaders.
3. Your population of "freeloaders" basically consists of: Retirees, students, and seriously disabled people. Almost all of them either paid taxes before they became "freeloaders", or will pay taxes in the future.
I am officially gone from
not paying exorbitant tax is not freeloading
Every tax, however, is to the person who pays it a badge, not of slavery but of liberty. It denotes that he is a subject to government, indeed, but that, as he has some property, he cannot himself be the property of a master.
-Adam Smith, "The Wealth of Nations", Book V, Chapter II, Part II, pg.927
Not a sentence!
thats just it.. theyve proven they cant operate within a budget. most of the things they do that affect me are negative... they take more and more of my money, and waste it on idiotic adolescent style peer pressure driven garbage. they drive up prices at the pump, at the grocery store with their market monkeying, and now they want their grubby hand in internet commerce. oh goody i cant wait for more of the status quo policy making this will fund while i have even less money to go around.
Yea, I know. I was referring to election years, not terms.
Good point of clarification, nonetheless.
An enigma, wrapped in a riddle, shrouded in bacon and cheese
BURN!
See how mature that was? And somehow it was more mature than your wanna be insult regarding Atlas Shrugged.
thats just it.. theyve proven they cant operate within a budget. most of the things they do that affect me are negative... they take more and more of my money, and waste it on idiotic adolescent style peer pressure driven garbage. they drive up prices at the pump, at the grocery store with their market monkeying, and now they want their grubby hand in internet commerce. oh goody i cant wait for more of the status quo policy making this will fund while i have even less money to go around.
You still make use of the services offered by the government.
They can't operate within a budget because of people like to make use of these services but no one wants to pay for them. They can't operate within a budget because voters can't agree on what they want from government, so things get pulled one way, then pulled the other way. The government is a reflection of the people.
The government does waste money, but pretty much every entity wastes money. And I think corporations do more to drive up prices at the pump (like defer maintenance at refineries and then enjoy the additional income from the price rise when a refinery does down) as well as the grocery store.
...the rest of the productive population.
Like middle managers, stock brokers, and politicians?
It would be good if they would give shipping companies a choice in how to pay sales taxes.
Either figure out the REAL sales tax (i.e. based on the shipping address) OR allow them to charge a FLAT 10% sales tax. If it is a flat charge, then the feds get 2% and the rest is given to the state of interest. From there, the state divvy it between themselves and the local areas. By allowing a simple flat rate, it removes all of the hassles esp. for overseas companies. And for foreign shipped goods, they should include the tax in the shipping costs (not to be paid separately).
If a foreign company is found to be cheating on amounts (such as declaring that it is not a sale), then both parties would be on the hook AND the sending company would be banned from mailing to America.
I prefer the "u" in honour as it seems to be missing these days.
Maybe we won't have to cover the earth with parking spaces if more of us would shop online.
I'm pretty sure this internet sales tax business is being pushed by the very powerful Asphalt Lobby. Or by the Illumanti because obviously that's how they hide their secret bases.
“Common sense is not so common.” — Voltaire
Wealthy people whose income comes from tax free bonds pay no federal income taxes. However they pay other local taxes on property etc.
If you are someone whose income comes from tax free bonds it means what? It means you loaned your money to the f-cking government who NEEDED IT (or so they were convinced) for some reason or another. Once you handed it to the government you did NOT have your money and could not invest it elsewhere where you would have made a higher return (which you would have paid taxes on, but would have probably still come out better). You couldn't BUY FOOD with that money even if you wanted. You couldn't pay rent with it if you fell on hard times. You couldn't even reinvest it. You have incurred an opportunity cost AND taken on risk. You do realize that's why those bonds are tax free right? Because they wouldn't be a good deal if they were paid the less than "market" rates that they pay AND you had to pay taxes on them. The government wants to entice you to put your money with them and making them tax free is one of the ways they can sweeten' the deal... but you seem to be missing that even with that benefit it still doesn't necessarily mean it was a good deal.
My present is the activity I am currently engaged in with the purpose of turning the future into a better past.
The typical American gets more out of SS and Medicare than they put in. Single men who don't pay an average of about $2000 a year in income tax are freeloaders at the federal level. So are single women who pay less than about $5000/yr and married couples who pay less than about $7500/yr. Take a look here for the info - that's the Urban Institute, not the Tea Party.
Next, the famously conservative Ezra Klein points out that the median taxpayer pays 13.9% of their income in federal tax and 11.3% in state and local. That's sourced here, where they point out this person makes about $42k/year. Now, since payroll taxes at the time the article talks about were 4.2% to SS and 1.45% to Medicare (from the employee's perspective), that means that they're paying 5.65% of their income as payroll tax, so the median taxpayer here is paying 8.25% of their income as federal income tax, meaning: $3465. This is muddied significantly by the fact that these figures represent all returns, not all individuals, so married couples' returns are mixed in with single people's returns, but since over half of people are women and quite a lot of those who aren't are married, it's pretty clear that a majority of people are getting a great deal from the federal tax system regardless of how they vote. Just because states don't hand out nearly as much free money (they can't print it) doesn't change that.
Yeah there is already Use Tax where your home state charges you for stuff you buy outside of the state.
Use taxes are constitutional because they place the burden equally on everyone in the state as opposed to sales tax which would put an unconstitutionally undue burden on the out of state seller (according to the Commerce clause).
...IF they eliminate the income tax at the same time. Fat chance...
...and the taxes were more to pay for European wars (the services) that the colonists did not see themselves as part of AND had no say (representation) in. The European wars often did have American theaters to them. The 7 Years War was know locally as the French and Indian War.
The library called, you really need to return that copy of Atlas Shrugged.
WTF is an objectivist doing borrowing books from a library? Don't they realize that public libraries are SOCIALISM????
How about no taxation with no representation?
I once had to do a 50 state tax filing registration for an international philanthropic investment firm (one of those make-work things they find for temps to do), and it took me over a WEEK, maybe two. Now, I'm definitely not an expert, but I'm pretty darn smart. Every state had their own forms, some of which had to be ordered by mail or phone (this was back in 2000, probably better now). And the filing requirements were wildly disparate.
Can a large shop like New Egg or Amazon afford to do this? Definitely. A small retailer? Possibly not.
Remember, this has to be filed every year. I'm not even talking about the collection of the taxes, or the accounting. I'm just talking about registering to do business in ALL fifty states every year.
-Curmudgeonly
I don't get to vote on how other states handle their taxes, so I shouldn't have to pay them. It's also way to much of a burden for every online merchant to handle the tax codes for all these different states and their ever changing rates, big companies can handle it so this will just squeeze out small businesses. If the federal government wants to have a blanket internet sales tax I would be fine with that because I actually have representation there. If the shipping address is within the US the US Treasury gets 1%, otherwise no tax which is simply enough for merchants to handle. If this passes everyone will move their online presence to states with no sales tax like Oregon.
I am fine with a state/local sales tax but a federal sales tax is really a simply horrendous idea. We should actually shift more responsibilities to the states and therefore the states should collect more money. We should get the federal government out of things like education and health care. The states should be taking care of most issues such as health care and welfare needs, not the federal government. I do think that it would be okay for the federal government to charge a tax on interstate commerce designed to equalize the cost of importing something into a state and producing it in the state itself, since this would avoid states being penalized for the policies they implement by strategic business relocations. This would actually allow most of the things the federal government is now doing to be shifted to states. States should be allowed to find what solutions are best for the state, different states can optimize solutions according to their needs. Of course there would be no such tax on things produced and consumed within a state. There is no natural law that the federal government is a better place to do health care and education related things. In fact, its safer to do it at the safe level, if a bad policy is implemented at the federal level, it damages the entire country. If a state implements a bad policy it is limited to that state and easier to get away from. I do think people should be free to move to the state that they feel has the best policies.
The new proposal bases sales tax on the buyer's address, not the sellers (the way it has been). Shipping stuff to my address has externalities for my community (traffic, waste, less local shopping). My community has an interest in deciding whether to be a low-tax, low-service, or high-tax, high-service area (and I can move to the system I like better, as people do a *whole lot*.) Letting communities collect tax on all purchases delivered into their borders is basically continuing the system we built our towns and states around. I don't necessarily care whether brick-and-mortars survive, but the old no-internet-tax system was forcing all communities toward a system they don't all prefer, and I would like variety to be possible. Details: By my druthers we wouldn't tax purely digital sales, because seems to me anything coming over the wires I'm already paying utility taxes for. Also, there are going to be people spending two hours and ten dollars driving over a state line to save eight dollars in tax. Well, not worse than dry-county borders, I guess.
They aren't proposing an inter-state tax. They want to collect the existing state sales taxes that are already due. If you buy something online you already owe your state sales taxes. Either the merchant needs to collect these taxes and send them to the states or you can do it voluntarily.
Nope. Try again -- but this time actually read the post I was responding to. If you can't do that, please don't bother to reply.
There's no -1 for "I don't get it."
roman_mir,
I am normal inclined to agree with you about monetary policy matters.
In fact Bernanke is on the record, talking about the need to 'prop up housing'. He wants house prices to go higher, because obviously it's so much better if things cost more.
But this is one case where Bernanke is possible correct. Its not moral or just its plainly stealing from some to benefit others but...
We have an ugly demographic problem were the large very near to retirement age segment of our population has all or most of their savings tied up in or otherwise exposed to real-estate. We can't have them work forever (that has its own implications for the young) and we won't simply let them stave. We haven't got the revenue to take care of them, so politically we are between a rock and hard place. Unless we blow a housing bubble.
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And the ugly demographic problem will become an ugly catastrophe when people will not be able to use dollars to buy goods they need to survive. What good if your house is 500,000 dollars if your weekly food costs you 10,000? 20,000?
The young will be much better off if there are no bubbles at all, if the debts are restructured, why should they be on the hook for the debts while in an economy that is suffocating because the debts prevent any type of investment?
You can't handle the truth.
I'm all for paying taxes because we all need to do our part, but get rid of the IRS and the income tax. There's no teamwork when it comes to the IRS and it's just a bunch of wasted money. Increase sales tax and everyone has no choice but to pay into them.
Sales taxes are fundamentally regressive. That's because the rich have investment opportunities, while the poor spend everything to survive. Where I'm at we tax food for God's sake. And Rent.
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Nice rambling rant but completely misses the point. #2 is simply an illustration of part of list of people who pay no federal taxes yet are not freeloaders.
As they say on the internet, WHOOSH.
Your math is very sketchy. Since the employer's contribution ends up in the SS and Medicare pools it's always regarded as part of the tax paid by the employee by economists. Not to mention of course that the temporary tax cut was exactly that, only temporary.
The ACTUAL tax burden is 12.4% for social security and 2.9% for medicare. 15.3%
Then on top of that you neglect the time value of money. SS is a pay as you go plan. Include that 15.3% in a reasonable investment plan and I have this feeling that all of a sudden it ISN'T going to look like such a great deal.
The Constitution specifically prohibits states from taxing interstate activity; the founders [a] wanted the states to, in-effect, compete with each other with taxes and policies (each state having its own, with businesses and citizens free to go where the living and working was best) and [b] wanted the federal government to be the referee by regulating interstate commerce (in the time of the founders, "regulate" meant "to make regular" rather than the modern idea of "to burden with rules taxes"). Rather than helping the states behave badly, the feds were supposed to keep the states from trying to tax across state lines, or trying to block imports and exports of various products and service to/from other states (for example: by a state like Georgia permitting goods in from Michigan, but requiring goods from Wyoming to have an "import permit" purchased from the Governor's brother.
Many states, having behaved badly and spent more money than they had, started violating all this by trying to tax interstate commerce. They knew this would be unconstitutional, so they played word games to evade the spirit of the law and they claimed they were applying "use taxes". The so-called "use taxes" are provably as phony as 3 dollar bills: they put a "use tax" on a book you bought from Amazon dot com without regard to whether you were going to use the book, or send it as a gift to a relative in another state, but no "use tax" on the same book if you bought it from a brick-and-morter in your town. The "use tax" is further revealed as a fraudulent Constitution dodge by the fact that they stop charging that tax on that book as soon as Amazon caves-in and starts paying a sales tax on the book. I am not advising anybody to not pay these phony taxes... because if you do not pay them they will come after you with real guns. But the voters should have driven their politicians out of office long ago over this and many other deceits.
Now many politicians are pushing for federal phony laws to circumvent the Constitution (none of the proposals attempts to legitimately amend the Constitution, each is just a fig leaf for sympathetic judges to use) in attempts to collect more taxes and make things "fair" for the brick-and-mortars in their home districts. Things are SUPPOSED TO BE "unfair". If the brick-and-mortars of California are at a disadvantage because they are in a 7.75% state and another business is in a 4% state, that is pressure on CA to stop raising taxes and perhaps lower them; Without such competition, all the states will feel free to keep raising rates because the average people will have no escape valve. If a business in CA is suffering because the governor is a moron and the legislature is packed with Marxists, the proper response is to move the business out of the state (punishing the state for its idiocy and greed) and NOT to demand that all other states become as screwed-up. People have forgotten that the justification for a "sales tax" was originally that a local business needed the same sorts of local services everybody else in town needed, but might not be turning a profit (so taxes on its profits would be zero) therefor the solution was to say to the business "add this tax charge to each sale when you provably have the money, collect it at the time of the sale and give it to the state, whether you make a profit on the rest of the transaction is a separate matter". A business outside of the state is NOT using local services and should not be fraudulently pulled-into paying for them. This has nothing to do with the book buyer; he/she is already paying plenty of local taxes as a resident in the community (even if a renter, where some of the taxes are indirectly via the landlord/landlady).
Government at all levels is simply out of control, unwilling to reign-in any of the many billions of dollars of fraud, corruption, duplication, etc and therefore is constantly looking for even MORE money. There will never be enough money for these politicians and this will not be the final such law; they'll be back for more and more and more until the people say "stop. no more until you clean-up the government and show that you are using what you have wisely and efficiently"
all those packages just magically teleport to your door dont they?
My money that bad.
Now try reading the REST of Adam Smith (as opposed to an out-of-context snippet that is passed-around at HuffPo or DailyKos as a weapon to use against the ignorant and the gullible).
This is like all the liberals who lob Biblical quotes like "Judge not lest ye be judged" (to pretend the Bible says "do not condemn bad behavior") and "Render unto Caesar..." (to pretend the Bible says "pay your taxes" and "separate your civic beliefs from your religious beliefs") while hoping nobody reads the rest of the Bible for the full context. Liberals who like to quote sentences of the Bible our of context don't like the bits that say that people who are able to work but do not work should not get charity... or that part that says "go forth, AND SIN NO MORE"... or the parts that say you can never solve poverty; that you'll always have poor people and you should not elevate them over other priorities, etc
As a general rule, if you are unwilling to pick an choose individual sentences from a history book, or an encyclopedia, or or a science book, or a biography, or a cookbook, then you ought not to it with a Bible, or with Adam Smith, or with any other book.
This law effectivly ends all small online retailers who would lack the resources to understand what tax to charge. If you want to charge a sales tax it has to be a charge that is reasonably knowable and reportable not something requiring interfacing with 50 different states and god knows how many tens of thousands of jurisdictions. You will need a spiffy GIS system to calculate out the local destination rate.
The shit part about this is large retailers will support it because it is guaranteed to thin out the competition the same way mattress industry supported burn standards to effectivly shut out small manufacturers.
"Corporate taxes" are a LIE that politicians use to try to convince the public to support higher taxes on themselves!!!!!
Let me explain:
1. Corporations are NOT people who enjoy having money, raise kids, take vacations, etc. They are BUILT by people and STAFFED by people and people invest in them and we make them into synthetic people (we in-corp-orate them) for legal purposes (so they can act as an entity in contract law etc). IBM is not "happy" when it has money (it's investors might be, but the synthetic person "IBM" is not... it's a person only on paper).
2. When a corporation distributes any of "its money" to a REAL human person (dividends to investors, paychecks to employees, etc) THAT person records that money as income and is taxed on it... so, sooner or later, every dollar a company gets from its products or services will either be spent on those products or services or will be passed-through to a person where it will be taxed.
3. ANY tax you put on a company becomes an EXPENSE on the company books... EXACTLY like the costs of employees, or raw materials, etc. When a company sets the prices of its products and services, the prices include all the contributing EXPENSES plus some percent of profit margin. Therefore, every dollar of taxes you put on a corporation gets added-into the costs of the products and services it sells and is therefore paid by the customer
4. Politicians LOVE taxes like this because they bring in revenue the politicians can use to win votes (by providing stuff to the voters) while hiding the tax in the rising prices of products and services (so that ignorant people get mad at the companies instead of the politicians for the COSTS of the stuff the politicians are "providing"). Look at your PHONE bill! Mad at the phone company for charging so much???? Half the stuff on your bill is taxes and fees to let politicians buy votes by giving-out "free" phones to poor people, low-cost land-lines to people in certain rural areas, etc. AND while the phone company IS itemizing many of these things, they're NOT showing you half of the picture: They're NOT itemizing all the basic business taxes you are paying for them to pay (those are hidden in the basic phone charge).
If you have a job in the US, you are probably paying half or more of your income in taxes without actually knowing it. First, you are paying the obvious ones (your income taxes using 1050 and 540 forms). Second, you are paying a bunch of taxes your employer is hiding from you (he/she is paying a bunch of taxes to employ you , like the half of your social security tax that is required and not permitted to be recorded on your pay stub); it your employer was not paying those hidden taxes, you could have a raise of that amount since the business is paying that money to employ you anyway. Then, when you buy anything, like groceries for example, you might or might not be paying sales tax (depending on your state laws) BUT part of the price of EVERYTHING you buy provides the cash the store passes on to the government as its "business tax"... and part of the cost of EVERY ITEM in your basket is money the producer of that item passes-on to the government to pay its "corporate tax" (which is actually a tax on YOU that was hidden from you).
This will go on as long as dumb and gullible people like you can be tricked into thinking that things will be solved by "tax the rich" or "tax the corporations" lies. The rich and corporations will ALWAYS have lawyers and accountants. The corporations will ALWAYS pass all their taxes (which are EXPENSES to them... take an accounting class and maybe you will learn something) on to their customers. The "rich" will always be smarter and have smarter lawyers than the government bureaucrats and they will always find every loophole to keep as much as they can. Politicians, no matter HOW "progressive" or "Liberal" will ALWAYS build loopholes into the laws (so they and their rich friends can slip through). There's a REASON why all the "progressives" in congress are so filthy RICH... just look at how insanely RICH the loony liberal lady senators of California have become while being in office!!!!! If you think they care about you or will ever truly go after the money of their rich friends like Bill Gates and Warren Buffet and the Hollywood stars etc then you are a fool who has absorbed all the propaganda. You have been cynically manipulated into being a TOOL. You have made yourself into a "useful idiot" and you have only yourself to blame. Barack Obama did not improve the lot of lower-income people while finally punishing "the rich" and he never will... he wants donors to build him a Presidential library and he plans to live for decades after leaving office as a rich guy with honorary board positions at corporations and rich friends letting him in on IPOs for promising start-up companies... Black Americans, in particular, are actually WORSE OFF under Obama than under Bush. Young voters who helped elect and re-elect him are similarly worse-off than under Bush.
Even if you really DID "tax the rich" at rates high enough to help, it would not help; You could TAKE all the money "the rich" have (something so extreme that no sane person no matter how "progressive" is proposing) and it would fund Obama's MASSIVE spending (which has benefitted all his "green energy" friends FAR more than YOU) for less than a year, and then you'd have no rich people left to tax AND still have massive public debt. This is true because while there are indeed some fabulously rich people, there are very FEW of them relative to the rest of the population. There are a lot more "somewhat rich" but still very few relative to the overall population. This all about basic math and basic accounting... the bulk of the money which the government can get year-after-year (rather than as a one-time "tax the rich" stunt that could not be repeated and will never happen) is in the hands of the middle class.
If you are middle class, or below middle class, you need to stop spending any time watching TV and being envious of a few airheaded rich celebrities and fantasizing that Obama will steal their stuff and give it to you; You need to realize that you are already paying more in taxes than your ancestors did and you are living in many ways less well off. For every dollar the government sucks out of the economy to give you something, YOU ultimately pay BUT the government sucks-off a bit as "overhead" AND the government attaches strings... it selects WHAT you get, or IF you get it, WHEN, HOW , and WHERE you may use it etc. You think you will get "free healthcare" but they will tell you what doctor to see, what treatment you may have, and when they will no longer provide (and therefore when your duty is to die) and because they are getting you to pay them to give you "free" healthcare, they will feel free to tell you if you may ingest salt, or sugar, what to eat, what to drink, how much you may have, and (eventually) how often and how much and what type exercise you must get, etc.
Wonder why the SAME politicians who are telling you what to eat and drink and smoke (salt bans, big-gulp bans, cigarette bans, etc) are then going all-libertarian on POT??? Bread-and-circuses... They KNOW this is all becoming un-tenable; Obama has finally admitted he has no pl
Progressivism is a political disease this county experienced in the early 20th century and the nation was so burned by it that it collectively turned-away from it and the progressives even changed what they called themselves to "liberal" to get away from the stink. Over the last several decades, they stunk-up the formerly honorable word "liberal" and calculated that the public had forgotten the early "progressive" experiences (and would be fooled into thinking "progressivism" had something to do with "progress" ... not much of a stretch given that so many uneducated people confuse "humanism" with "humanitarianism")
Bush and Obama are both "progressives" in the traditional sense (though one is a social conservative and the other a social liberal). If you think you are a "progressive" because you are a "good person" and you therefore find yourself blindly supporting "progressive" politicians and causes then you need to do some VERY SERIOUS history reading... you may come away shocked and repelled. It's NOT purely a right/left thing, though at this moment in history there are some big overlaps between left-and-progressive and right-and-anti-progressive. Early 20th century progressives started-out promising progress toward a shiny future classless utopia... and ended-up supporting euthenasia, eugenics, etc (and a certain former artist and WWI corporal in Germany with a bad comb-over adopted some of that nifty progressivism....) If you cannot be bothered to do a serious study of progressivism and are convinced it's all about "good people", then at least look at some very famous film of a famous left-wing progressive of that era (a few minutes of YouTube will let you see a snippet of it grabbed from some documentary, a trip to the national archives might be better) and WAKE THE HELL UP! George Bernard Shaw is STILL loved by left-leaning progressives event though they know this stuff! These people are a NIGHTMARE
The simple fact is this: If you grow the government so it can serve you, it will get powerful enough to serve you... and then look for more ways to use that power. When you invite the government in to keep your neighbor from doing things you do not like, it will be there to stop YOU from doing anything any of YOUR neighbors do not like. Progressives in BOTH parties grew the government to do things it was never supposed to do... and now all that excess government is doing (no surprise here, unless you are Gomer Pyle) .... lots of stuff it was never supposed to do.... and NO amount of money or surveillance will be enough.... and it will continue to NOT solve the problems it was asked to solve because then it would lose the justification to ask you for MORE money and power...
They ARE playing by the same rules... the brick-and-mortar is paying sales tax because it is using state and local resources. The sales tax is just the mechanism to get taxes even from unprofitable businesses. Your local brick-and-mortar is perfectly free to start selling via mail order to people in other states (without the tax) to compete against THOSE brick-and-mortars
Oh, and why do you not pay both a sales tax AND the "use tax" on stuff you buy from the local brick-and-mortar???? Because it's not really a "use tax"; it is an unconstitutional interstate sales tax that your state's government hopes is never properly challenged through the courts by a competent law firm. The local courts will probably support it because that's where their paychecks come from and they want the state to have the money... but the US Supreme Court would probably stomp on this garbage if a good case made it to their level... this is a case that goes directly to the plain-text of the Constitution and the basic application of simple logic.
There is no question they young will be better off with affordable housing and a functioning market. There is is no doubt that inflation usually results in negative wage growth if you look at the compounding effects of constant price growth vs typically anually at most COLA adjustments by employers. I don't doubt you.
What I want to know is what do we do with all the nearly retired who were expecting to live off the proceeds from they sale of there inflated home and often far to little savings to make up any short fall there. Again the right thing, the ethical thing, is for government to stop blowing bubbles, but how do we get there from here; without creating a whole new group of dependants who will likely be on the dole for 20-30 years until they expire, or crowding younger workers if they are especially healthy and able to work?
I really don't have an answer but as a nation we need some kind of plan, sadly the only obviously answer to me is new housing bubble; which is of course a quick fix that will lead us to asking the very same question when it next pops, and all bubbles do pop.
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what do we do with all the nearly retired who were expecting to live off the proceeds from they sale of there inflated home and often far to little savings to make up any short fall there.
- let the interest rates go up where the market takes them right now and the retired will have an income from their savings. Worst case for those who don't have savings except for a house is to sell the house in the falling market and use the money from the sale to get income due to actual interest rate that the market would pay for their savings if the government stops destroying the money.
Do you not see that the people who are hurt the most by inflation are those very people on fixed incomes and the retired, whose checks will buy less every month.
Who knows, the Cyprus like situation is not actually impossible. Cyprus bought bad Greek debt and now has no money to return to the depositors, who are just creditors to the bank. So it's not the bond holders that are going to take a haircut, but the depositors. Of-course the bond holders should now run forward and offer to take a haircut and spare the creditors (depositors), otherwise the bondholders will lose 100% (those who didn't liquidate yet, many did probably), because without depositors there is no bank.
My point is that the situation that the Fed is creating with inflation is almost unpredictable in terms of how exactly it will play out, but it IS predictable that there will be an implosion due to this, and so why would you want to risk an implosion (imminent implosion) instead of allowing the economy to restructure right now? Yes, restructuring means a recession. You know what, USA is in a depression right now, never mind the government numbers, the reality is that there is no recovery. The jobs are fewer every month (they can manipulate the numbers because there are people who stop looking and so it may seem that unemployment numbers go down, in reality what is going down is the desire and ability to work in that system).
new group of dependants who will likely be on the dole for 20-30 years until they expire,
- you are assuming that this is possible for the government to take care of the people who will suffer due to the economic collapse for 20-30 years, I beg to differ. I don't believe that there is any way at all to take care of them. That's what I think the situation is, there is no way to take care of them by using government if the system blows. Government gets its money from working people and that's how the dependent get their checks. If the system blows the way I think it will, then the government will not be able to take care of ANY dependent people, it's a physical impossibility.
Even with interest rates being over 3% the system collapses AFAIC, but if the interest rates are, say, 15%? 35?
At 7% the entire revenue of USA goes towards interest payments, nothing else, and actually it's worse, because at those interest rates USA revenues will be disappearing for a while at least, there will be many failures, so much fewer income revenue will be coming in.
Do you see what I am saying? You believe that it is physically possible to take care of people for 20-30 years, I think what will happen will make it a physical impossibility to do it. It would be better right now to stop pumping money into the system and allow interest rates to rise now and take a hit and let the prices fall and let people to start making income from interest payments (this would deflate the bond market bubble, the equity bubble, this would return some stability to the dollar).
I think the pain that will come because of that will be much less prolonged. 1921, 1947, 1981 show that the difficulties that are met with real cuts and higher interest rates are solved by the market in just a couple of years.
I think what will happen if this is not allowed will last for decades, and then yes, your scenario: wait until people die off (but you won't have to wait
You can't handle the truth.
I am not sure from your tone (or offended don't worry) but I don't want you think I am arguing with you. I am really enjoying this conversation; because reading your posts for a long time now, I have really come to respect your opinion and knowledge about this subject.
I don't think is possible for government to take care of all the retired or soon to be either. Which is why I was/am looking for a way to avoid the need or politically perceived need to do that. You are correct the fixed income folks are hurt by inflation. Those folks that have already done the home downsize and transition to living on SS, annuity payments, bond interest are better positioned though than the folks still just about it.
Correct or not (and largely due to government propaganda as much as anything) the typical thinking in 2007 was that if you had a $500K valued home, owed $300K, and had $200K in equity that effectively meant you had $100K in retirement savings because it was going to appreciate another $50K in the next 5 years. From some magical place a buyer for your $550K home was going appear despite the fact you know your own children could never scrape together a down payment for a house like yours. You were going to come away with $250k in proceeds from the sale at that time of which you would spend $150 on a little bungalow some place to live in.
Aggressively stupid! Certainly. None the less this is what these people expected to happen.
That house now will sell for $300K. So the whole plan is really unhinged. Even if interest rates go back to 1980's levels you won't generate enough revenue to buy groceries and heating oil with bank deposits, money markets, and investment grade bonds with so little principle. You won't have enough for rent payments on a crappy apartment if you preserve a little extra captial and skip the buy the bungalow part.
So here is the central point of the matter. Without a housing bubble I think your dollar bubble is nearly as certain as death and taxes. We can't find the political will reduce actual spending at all; and we can barely cut when we tell ourselves nice little lies like not adjusting for inflation counts as cutting. The sheeple are stupid they will cut off their own leg to feed the mouth if a guy in a nice enough suit tells them to do it. I don't think the government can take care of everyone but it will damn well try. That means the FED balance sheet expansion at beak neck speeds. When the interest exceeds the revenue the treasury will start to play games minting trillion dollar coins. As you say then it goes BOOM.
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I am not arguing, I am writing thoughts down in response to any question and to criticism (I mostly get criticism).
It's going to be impossible to do the right thing, politically it's impossible, so it's a majority driven suicide pack and because of that you have to take care of yourself and people you know, I don't think you can fix the problem for all, just try and mitigate it for people you care about. There are no politicians that will do the right thing in the office. The ones who would do the right thing do not get access to do it, Ron Paul didn't get access, Gary Johnson didn't get access, etc.
I am looking at Cyprus, because it's a microcosm of what is happening everywhere (some of my relatives have some money stuck there that were in transit, so money was moving through a bank in Cyprus, and just like in a highway robbery, with masked bandits stopping the wagon to loot it, the bankers and politicians in Cyprus stopped a transfer of funds and stole it). And so what do we observe from the politicians and bankers? First they steal to create an illusion of prosperity (apparently they were getting a 'good return' on buying Greek bonds for a few years, that Greek debt became expensive) and when it obviously went bust, they started looting anything they could put their hands on, even money in transit. That's the only thing politicians understand how to do - steal, they know nothing else. Again, those who wouldn't steal and wouldn't promise to "take care of people" are not in government.
The problem with hoping that the Fed's next bubble will prevent the dollar bubble is that you can't and neither the Fed can control where the bubble is going to form. Sure, the Fed buys mortgages to the tune of 80Billion USD/month (and it's going to increase those amounts), but so what? What happens with those loans that the Fed gives out with fake money? Where does the inflation go? The money is created and then the owners are expected to refinance their houses because the Fed creates artificial demand, so the owners refinance just to make payments in the inflating economy.
That money that is a liability to the Fed, but that's irrelevant. That money flows into the system through the mortgages and it ends up somewhere. Where does it end up? Who gets it? It's partially the stores in USA, partially it's the manufacturers in other countries (50Billion USD/month trade deficit shows that USA consumption comes from other countries, and that 50 Billion is just the trade deficit, never mind the amount of goods that come in that are actually paid for, so they don't end up as deficit, but the manufacturers still get the dollars).
But those dollars end up in foreign central banks, that print the local currency to buy the dollars, and then they use the dollars to buy more short term US Treasury paper, they can't do anything else with it. So they grow their credit balance with USA Treasury. That's the bubble, not the mortgages, because you see, the money doesn't end up in anything but Treasuries (and equity).
Why doesn't it end up in anything else? Because there is no investment and production.
What do the store owners do with their part of the money that they get from the transactions, when the refinanced mortgages are used to buy the goods? They pay the ever inflated prices for rent (again, thanks Fed), utility costs, taxes that are going up in everything, don't forget Obamacare, that's a tax that will cause massive shift from permanent jobs into part time jobs for low quality positions.
So plenty of that money is just siphoned into the government as taxes again but whatever is not is recirculated into something else.... equity prices - the stock market traders are happy that the Dow is going up, the stocks are going up.
Bernanke won't be happy until Dow hits 20,000, well sure, but that's just inflation in itself, it doesn't create any new productive output.
So what have is just bidding wars. Bidding wars to escape inflation - bonds, equity, and you have an attempt to reflate
You can't handle the truth.
It's going to be impossible to do the right thing, politically it's impossible, so it's a majority driven suicide pack and because of that you have to take care of yourself and people you know
Other way around, people only want to take care of themselves, and because of that, it's politically impossible to do the right thing.
What do you think the politicians are doing, if not taking care of themselves and people they care about?
What do you think the mob who votes for more welfare for themselves are doing?
All those other people who you think are to be blamed for the destruction? They're not other people. They are you
I have been telling this to people for quite a long time, many years now.
More evidence that you are part of the problem. You've been talking, people have listened, and yet things are still worse than ever.
The common denominator of all your problems... is you
Since the internet was an outgrowth of US-government-supported research, how about a flat sales tax (say 5%) on internet sales, not otherwise subject to state sales tax, that would go to fund scientific research of all sorts, including both basic and applied research. The government can take the difference from what it now spends on research, and give it to the states to compensate for lost revenue.
This way, scientists can be assured of a consistent source of funding. This will make America smarter, and more competitive.
Geez, people!
Let's just increase taxes every month by 5% What
is your tipping point? When 95% of what you make
goes to government?
If you were to receive a pay increase that doubles
what you are making, who would you want to decide
how to spend or invest the extra money, you or
someone else? You are the best person to decide
how to make yourself happy.
The average person pays over half of their
productive efforts to the government. Also, the
externalities of higher taxes creates more entropy
rather than synergy.
Instead of arguing about this particular tax, we
should be fighting for cutting taxes by 90%.
Or, we can just keep going in this same direction
towards Idiocracy:
(http://www.rottentomatoes.com/m/idiocracy/).
It's amazing how all governments constantly look for thriving free systems from which they can find a way to extract value and wealth for their own selfish desires. If they could control the planet's breathable air, they would -- and then tax it.
Unfortunately, government at many levels in the US is willing to pass laws that violate the Constitution, or the Bill of Rights.
Creating contradictions in the legal system increases the long term demand for the services of legal professionals. Hence, it should be no surprise that our legislators (most of whom are legal professionals), continue to create laws that do exactly this, and our judges (most of whom are also legal professionals) choose to uphold laws that contradict the Constitution or the Bill of Rights. Both parties in acting in violation of their oaths of office, of course, when they do this, but there doesn't seem to be enough people in with system with integrity for this to matter, and so long as "we the people" don't pay attention to this issue, this problem will continue.
The big problem with the sales tax issue is not specifically a Constitutional one, but a fundamental issue of freedom. Consider the following thought experiment. Suppose, in the pre-internet days, a person was to live near the border of a state. Across the border, in a state with no sales tax, are stores providing the necessities of life, within a five minute drive of this person's home. Within his or her state, the nearest store is a 1 hour drive in each direction. Under these circumstances, any rational individual would clearly choose to make their purchases at the nearby stores (not only would this save substantial amounts of time from their life, but it would be environmentally the right thing to do).
Further, it would clearly not be a legitimate act of government to force the individual to make a lengthy drive simply to shop: a right to not have one's time wasted must necessarily be a fundamental freedom.
Similarly, it would clearly not be a legitimate act of government to force the individual to keep track of every purchase made, and whether or not it was made locally, in order to then force that person to pay taxes: a right to not be subject to excessive bureaucracy is certainly a fundamental freedom.
Now take this thought experiment to the present day. The Internet is simply a form of technology that has effectively moved this border closer to every person: if it was not legitimate to tax out of state purchases before, then it can not be so now.
There are two ethically sound options here: 1) Have a national sales tax, and bar state sales tax entirely, and 2) have no sales taxes at all, making up the lost revenue in income taxes.
Eliminating sales tax entirely is the more intelligent policy, as sales taxes represent both a) double taxation on earned income, always a legally and ethically suspect policy, and b) sales taxes are biased against those who least afford to pay them: it is not possible to ethically justify the extra complexity this creates in the legal system when we are also having progressive income taxation.
I'm aware that this money is paid on their behalf. But it's not on their tax return, so I didn't include it when talking about studies that look at numbers off people's tax returns. I used the lower rate that applied at that time because... that's what everyone in the study was paying at the time and reporting on their 1040's. I'm sure that the math for total in/out includes the other half of the tax.
We assume that the UPS trucks don't need to be parked at the local mall. So significantly less asphalt required.
The only freeloaders here are in Congress and the State Legislatures.
Time to put a stop to this bullshit.
I read that to cover imports/exports, not sales. Like when I mailed a friend in another country a sweater, she had to pay a import fee in order to get the sweater.
"No Tax or Duty shall be laid on Articles exported from any State." - Article 1, US Constitution, I think was designed so that just shipping your goods from state X, through states A,B,C, and arriving in state E, would disallow states A,B and C from imposing import fees on the shipment.
Dropping some of your goods off in A,B, and C along the way, and then selling them in those states, would still be subject to a state sales tax though.
BURN!
See how mature that was? And somehow it was more mature than your wanna be insult regarding Atlas Shrugged.
Atlas Shrugged is a screed from a particularly childish and selfish philosophical movement, it neither requires nor deserves a particularly rigorous debate.