tvrec wrote:LJF wrote:Adurentibus Spina wrote:creep wrote:why did romney wait until now to release his tax info? 14% tax rate for 2011. i wish i paid 14%!
Mitt Romney made $13.7 million last year and paid $1.94 million in federal income taxes, his campaign says. His rate was up slightly from the 13.9% rate he paid in 2010.
He should be paying 90% (on the highest portion of his income, that is...).
Why? If he is paying what the tax laws says, then he isn't doing anything illegal. His income comes from investments which at different rates.
Not to put words in anyone's mouth, but I don't think AS was suggesting Romeny was doing anything illegal.
Indeed. I was suggesting we ought to return to 1958 marginal rates (and implying that investments should be counted as income). I don't think LJF is ESL, but he seems to have misunderstood my use of 'he should be paying' to mean 'he should have paid'. The first phrase is in the subjunctive tense (counter-factually speaking), the second is in the past-perfect... totally different meanings. I was not talking about what Romney ought to have done, personally. I find it frightening that what I said could be interpreted that way, but never mind. I'll try to explain why I said that.
Economists argue over what effects this would have, and in any case, I'm being semi-facetious, since it would be idiotic to suddenly flip from 35% to 90% on the highest marginal rate (hence Clinton's 4% increase.)
A good start would be re-jigging investment income so that it gets taxed at the same rate as income tax. There are some reasons not to do this, but I don't think they're overwhelming. The reasons to do it, however, do seem to be overwhelming. (People who don't make considerable money from investments wouldn't be penalized, since on the first bracket, they'd face a marginal rate of 0% anyway...) Romney is a good case study for taxing investments as income.
In real-world terms, and not joking, I see no reason at all not to close as many loopholes as possible and to raise the highest marginal rates 4-6%. You cannot spending-cut your way out of a massive deficit without increasing income.
Think of it as akin to a person with say, $100,000 of credit card debt trying to pay off their debt by paying the minimum each month, and just cutting their spending. The spending cuts don't necessarily reduce overall costs, since inflation, interest, and necessary (non-cuttable) costs may (and in fact, do) exceed revenue in the first place, given the reduction in revenue income caused by tax-cuts and the recession. It will take many more years to pay off this debt, and extend the hardships of this person unnecessarily than would increasing revenue which can be put toward debt reduction and services which reduce costs in the first place. Merely cutting spending actually produced the opposite of the desired effect, since it expands and deepens the difficulties of those who have been most economically hurt by the recession in the first place (thus making it even more difficult for these people to move up in the tax-brackets and generate slightly higher tax-revenues). In fact, increasing spending in the right areas has a positive effect on tax-revenue AND and the unemployment rate, and thus the national debt. But of course the positive effect on tax-revenue can be magnified by increasing the highest marginal rates (and maybe even slightly decreasing the lowest marginal rates).
It's fairly straightforward. As a small example of one kind of spending increase that would actually reduce costs, there is a preponderance of evidence that shows that providing housing (not even necessarily affordable housing, but even straight-up paying for it) for the homeless/working poor reduces necessary costs associated with these conditions (like health-care, legal representation, jail, and even the economic costs of frequent hiring/firing/training/re-training costs) drastically.
