"Raise My Taxes"

[guido911]

Whose taxes do they want raised?

[Townsend]

AP tweet:

BREAKING: White House: Obama will veto any bill extending tax cuts for those making more than $250K.

Reuters:

President would veto any bill that extends Bush era tax cuts for top 2% of wage earners - White House

BBC:

The wealthy must pay more taxes to avert looming budget crisis, US President #Obama says.

[Conan71]

I listened to his speech live.  For the first time in five years, he didn't make it sound like class envy or class warfare.  He said it much like Clinton would have: "I'm going to ask the wealthiest in this country to help out..."

I like the tone a whole lot better than "Millionaires and billionaires aren't paying their fair share!" or coming up with business jet taxes.

I really do hope some lessons from the last four years have been absorbed by this admin.  I also hope they don't think of just over 1/2 of the popular vote as a "mandate" or "resounding victory", it's not.

[nathanm]

I also hope they don't think of just over 1/2 of the popular vote as a "mandate" or "resounding victory", it's not.

Coulda fooled this guy. But he can't get fooled again! (just saying..he did claim a mandate..of course he also claimed a mandate from a popular vote loss)

[Gaspar]

Moved from another thread.

Lets try this again. . .


I'm Joe business owner.  I have 4 employees and one part-time janitorial staff. I pay for an excellent benefit package including healthcare for my employees.  I have a big home, 3 kids and a timeshare in Branson. I pull $250,000 in "salary" distribution from my company every year.  I am far below the number of employees necessary to be required to cover medical care yet I find myself facing an unknown increase in medical insurance costs.  Next year I will have to pay about $12,000 more in taxes.  No problem, I will simply pull a higher distribution from the company.  If my margin is tight (as in most businesses these days) I will eliminate un-necessary staff, or simply raise my prices.  After all, my competition faces the same decisions.

Now, I am not an island.  My venders, steve, Doug, and Hector are facing the same decisions.  Steve and Doug raise their prices to me to cover the new tax burden.  Hector eliminates a weak product line that I happen to carry and reduces some of his staff.


So now, on top of the additional tax burden, and the unknown state of benefit costs, I have increased wholesale costs and the loss of a product line, and the consumers of my products have to pay more and therefore purchase my products less often.  They are sad, as am I.  


The CHANGE that has occured is that revenue has been extracted from the free market to pay for government debt.  Libs would say, "Yeah we took it from those evil rich folks," but I own my business and manage the mechanisim.  I may sacrifice some of my income to increased taxes, but not before I exhaust every avenue to preserve it.  Therefore workforce contracts, and most expenses are transfered to the consumer (I hopefully don't have to tell you that the vast majority of consumers in this country are the middle class).

Now, play this same scenario through with a bunch of rich guys in a large corporation or publicly traded company and the outcome is virtually identical.  Taxes and increases in cost are transferred to the consumer, or extracted from the stock holder (middle class 401Ks make up the majority of those).  If the market won't bare the increases, labor is reduced and efficiencies in production are implemented.

I keep my fish, and you get to pay for it. Don't complain, after all, you voted for it.


This concludes Sock Puppet Theater.

The president knows this. Raising taxes even on the wealthy "Sucks up. . .uh. . .takes more demand out of the economy and puts businesses in a further hole."

[nathanm]

So what you're saying is that rich people will stop conducting profitable business because they pay more income tax? In other words, that they'll shoot themselves in the face. Ok. If someone is that dumb, let them be an idiot. If there is profit to be made, someone else will meet the demand. And you implicitly argue that we don't have a free market in this country. You raise your prices, but your competitor, not being an idiot, accepts a temporary reduction in his after tax income, keeps his prices the same, and takes all your business. Good plan you've got there, bucko.

[Gaspar]

So what you're saying is that rich people will stop conducting profitable business because they pay more income tax? In other words, that they'll shoot themselves in the face. Ok. If someone is that dumb, let them be an idiot. If there is profit to be made, someone else will meet the demand. And you implicitly argue that we don't have a free market in this country. You raise your prices, but your competitor, not being an idiot, accepts a temporary reduction in his after tax income, keeps his prices the same, and takes all your business. Good plan you've got there, bucko.

No, they won't shoot themselves in the face.  We increase prices all the time when our costs increase.  The company I work for increases prices, and frankly we are not very concerned about competing on price.  When smaller more nimble companies see their competition increasing prices due to costs, in many cases that signals a gap in margin that encourages them to increase their prices as well and capture that margin.

No one leaves money on the table, or sacrifices their own income unless they have first exhausted all other options.  Producers don't just sit back and take a punch.  If your boss said he was going to cut your salary, would that not encourage you to explore other employment or would you just take it?

I work for a great company.  I own two other small businesses, and my wife just started another.  I've worked for some large wholesale distributers in the past.  Tax increases, fuel, vender costs, and labor are all factors in pricing.  The first place a business goes to cover costs is to the consumer, not the stakeholders.

[nathanm]

No one leaves money on the table, or sacrifices their own income unless they have first exhausted all other options.

Yet that's exactly what you say they will do.