Not Too Shabby Mr. President, Your Blue Ribbon Panel is for real!

[Gaspar]

Remember that Blue Ribbon panel on debt reduction that the president created earlier in the year.  Well, they've made their recommendations and I must admit, they've come up with some darn good ideas.

Reducing Taxes significantly to 8 percent, 14 percent and 23 percent and getting rid of deductions
Cutting Medicare
Raising Retirement Age
Medical Tort Reform
15% cut in Congressional budget cuts

I could care less what side of the isle these ideas originally came from.  They are a very good start.

I wonder what the chances of these recommendations going any further is?   

[Conan71]

Remember that Blue Ribbon panel on debt reduction that the president created earlier in the year.  Well, they've made their recommendations and I must admit, they've come up with some darn good ideas.

Reducing Taxes significantly to 8 percent, 14 percent and 23 percent and getting rid of deductions
Cutting Medicare
Raising Retirement Age
Medical Tort Reform
15% cut in Congressional budget cuts

I could care less what side of the isle these ideas originally came from.  They are a very good start.

I wonder what the chances of these recommendations going any further is?   

I like the list.

Cutting Medicare and medical tort reform are pretty sacred cows with the Democrats so I'm impressed they show up on the list.  Certainly on raising retirement age they only intend to do that to non-union members. 

[Gaspar]

This panel had to employ reason and logic, therefore they must brace themselves for ridicule and repudiation.  Much of this will become an anchor for the new Republican House.  The administration will have to find a way to nip this in the bud quickly. 

I suppose they could leak a report about Erskine smoking crack or something.

[nathanm]

I'm trying to wrap my head around how it is that further tax cuts will reduce the deficit. Last time we tried it, it didn't work. The time before that the signals were very mixed..economic growth didn't actually happen until taxes were raised, and even then, it took savage cuts to welfare, science funding, and the military to get the deficit under control.

Edited to add: Or to put it another way, what tax increases were passed prior to January 2008 that caused us to see the first negative year-on-year GDP growth since the Great Depression?

[Conan71]

I'm trying to wrap my head around how it is that further tax cuts will reduce the deficit. Last time we tried it, it didn't work. The time before that the signals were very mixed..economic growth didn't actually happen until taxes were raised, and even then, it took savage cuts to welfare, science funding, and the military to get the deficit under control.

I think the inference is that with a simplified tax code, more people wind up paying more in taxes even at lower rates.  With higher taxes, people simply find ways to legally avoid paying them or deferring them.  Get rid of loopholes and favored deductions. 

That is, unless it's going back to the proven theory that when taxes were cut before, net reciepts to the treasury increased.

[nathanm]

I think the inference is that with a simplified tax code, more people wind up paying more in taxes even at lower rates.  With higher taxes, people simply find ways to legally avoid paying them or deferring them.  Get rid of loopholes and favored deductions. 

That is, unless it's going back to the proven theory that when taxes were cut before, net reciepts to the treasury increased.

As I mentioned, that's not really proven at all, except in the sense that per capita income and population were both increasing, so of course tax receipts rose. The Reagan cuts didn't really do anything to the GDP growth rate or the tax receipt growth rate, but they did help balloon the deficit. I'm not saying there was no effect whatsoever, just that it's such a small effect that it's masked by the natural variations in the economic cycle.

I can understand how perhaps cutting the marginal rate and eliminating all deductions might actually increase collections.

[Conan71]

As I mentioned, that's not really proven at all, except in the sense that per capita income and population were both increasing, so of course tax receipts rose. The Reagan cuts didn't really do anything to the GDP growth rate or the tax receipt growth rate, but they did help balloon the deficit. I'm not saying there was no effect whatsoever, just that it's such a small effect that it's masked by the natural variations in the economic cycle.

I can understand how perhaps cutting the marginal rate and eliminating all deductions might actually increase collections.

Interesting to note that the 23% top rate is the same rate as mentioned in the Fair Tax plan which is a consumption-based plan not to be confused with the "flat tax". 

Here's the thing: raising or lowering taxes by the percents we've been quibbling over the last two years is little more than sound bite material, IMO.  If taxes go up, there will be ways to avoid paying them.  Lower them, simplify the tax code, lower compliance costs, and trim down the size of the IRS.  One of the things I dislike most about Obamacare is the additional IRS employees required for compliance issues. 

People like Warren Buffet can complain all they want about the tax rate they pay in public, but he's got a team of accountants who ensure he pays as little in taxes as possible when he's off the microphone.

[Red Arrow]

People like Warren Buffet can complain all they want about the tax rate they pay in public, but he's got a team of accountants who ensure he pays as little in taxes as possible when he's off the microphone.

A few people are lucky enough that the gov could take almost everything they make and they would still have more than most of us.

If I was making $100,000,000 per year and the government took 90% of it, I would still have $10,000,000. per year.   I think I could learn to live on that.  I would have to cut back on my lifestyle though.

[Gaspar]

I think the inference is that with a simplified tax code, more people wind up paying more in taxes even at lower rates.  With higher taxes, people simply find ways to legally avoid paying them or deferring them.  Get rid of loopholes and favored deductions. 

That is, unless it's going back to the proven theory that when taxes were cut before, net reciepts to the treasury increased.

Bingo!

[Gaspar]

Conan, stop now.  If they figure it out, they will start throwing around the word "Irresponsible" and attack their own for embracing it. They need to think it's their idea.

Let them have it.

[Conan71]

A few people are lucky enough that the gov could take almost everything they make and they would still have more than most of us.

If I was making $100,000,000 per year and the government took 90% of it, I would still have $10,000,000. per year.   I think I could learn to live on that.  I would have to cut back on my lifestyle though.

I always talk about what a pain in the donkey it must be to be that rich.  I'd like to see first hand though.

Just think about it Red, you could buy a new Citation every year and have plenty of fuel money to fly it anywhere you liked.   

[Hoss]

I always talk about what a pain in the donkey it must be to be that rich.  I'd like to see first hand though.

Just think about it Red, you could buy a new Citation every year and have plenty of fuel money to fly it anywhere you liked.   

best.biz.jet.ever.made

Especially the X.  Fastest biz jet ever.  At least it was a couple of years ago (0.92m at cruise).

[Conan71]

best.biz.jet.ever.made

Especially the X.  Fastest biz jet ever.  At least it was a couple of years ago (0.92m at cruise).

Quit it.



Back on topic, they were saying on the radio on the way in this morning that the Obama Admin is willing to consider extending the controversial Bush tax cuts.  Between this and QE2, I'm seriously beginning to question if there's an intentional effort afloat to tank the dollar. 

[Cats Cats Cats]

If you make 30k a year and have 11k in standard deductions and 6k in mortage deduction you can you have 43% of your income taxable.  THey could cut your tax rate in half and cut the deductions and you would still get more money.  The deductions at the top are even higher, but not as much of a percentage of total income.

[Cats Cats Cats]

I like the list.

Cutting Medicare and medical tort reform are pretty sacred cows with the Democrats so I'm impressed they show up on the list.  Certainly on raising retirement age they only intend to do that to non-union members. 

Are you serious?

"Don't cut Medicare. The reform bills passed by the House and Senate cut Medicare by approximately $500 billion. This is wrong."  Newt Gingrich

You might want to rethink your medicare stance.  See they just cut it, so therefore the Republican's are for medicare spending.  (Actually, really they are, look at Bush's increase in Medicare spending with his "reform".  It is right up there with stupid things to do EVER)