Trump Tax Cut

[carpedm9587]

The Politics of Envy -- Satan's favorite tool since Eden.

A cute label - but highly inappropriate. These are the politics of math and economic justice. By your argument, any attempt to say "hold on a sec - you are lining your pockets at my expense," is nothing more than "envy" and we should meekly submit.

The median net worth of a member of Congress in 2014 was $456,522. Something must have changed towards the "wealthy" because 207 out of 535 members of Congress had a net worth that made them at least a millionaire, with the richest member at over $283 million. The president is reputed to be worth more than $1B (of course, we don't know if that is actually true). This is the group that signed into law a tax cut that gave an average 0.4% increase to the lowest wage earners, and 2.9% increase to the wealthiest (among which many of them number). The President signed it, all the while telling everyone "the wealthy won't benefit." The tax cuts to the lower and middle classes were significantly counter-balanced by closed loopholes, but the tax cut actually increased the loopholes to the wealthiest. And the tax cuts that most impact the lower and middle classes all have expiration dates, but the tax cuts that most benefit the wealthy have no expiration date. Meanwhile, the "tax cut that would pay for itself" has resulted in deficit levels similar to those under Obama - and he had a recession to deal with. We are in a healthy economy when deficits should be shrinking. Imagine what will happen to the deficit if we actually do slide into a recession in the next year or two.

It is not the "politics of envy" to recognize when you've been had and call a con job a con job.

[NorrinRadd]

If the tax cut is the cause of the increased deficit, why are Federal revenues *higher*, and expected to further increase again next year?

(Based on the data here. Admittedly, the *rate* of increase seems to have fallen under Trump, based on my hasty estimation, but the absolute intake has not dropped. As usual, the problem seems to be spending.)

[carpedm9587]

If the tax cut is the cause of the increased deficit, why are Federal revenues *higher*, and expected to further increase again next year?

(Based on the data here. Admittedly, the *rate* of increase seems to have fallen under Trump, based on my hasty estimation, but the absolute intake has not dropped. As usual, the problem seems to be spending.)

You get a deficit when spending exceeds revenue, as you well know. That can be caused exacerbated by a) spending increases, b) revenues decreases, or c) both of the above.

In this case, while tax revenues increased, they did not increase as much as they would have without the tax cut. The general increase in revenue reflects the fact that the GDP grew (so they didn't cut enough tax to cut out all of the increase from the increase in GDP). But the GDP did not grow at a level substantially higher than under Obama for his second term. The difference is an increase of about half a percentage point. And despite this modest increase in GDP growth, the rate of tax increase actually fell (as you noted). That is the impact of the tax cut.

Spending is also part of the equation. Trump and the Republicans put the worst of the two things together: massive spending and constrained income.

Not that the Democrats would have done any better. These days, the only party interested in debt and deficit is the party OUT of power.

[Mountain Man]

Whyisthishappening podcast, can we tax the rich? Interview with Jesse Eisinger. Essential ‘tax’ listening.

Of course we can tax the rich. Just don't expect the rich to passively let it happen. Look at what happened to the luxury yacht industry in the US when Congress had the bright idea to institute a crippling luxury tax. People simply took their business outside of the country and had their yachts registered in other nations where US tax law couldn't touch them, and the yacht industry in the US collapsed.

[rogue06]

Of course we can tax the rich. Just don't expect the rich to passively let it happen. Look at what happened to the luxury yacht industry in the US when Congress had the bright idea to institute a crippling luxury tax. People simply took their business outside of the country and had their yachts registered in other nations where US tax law couldn't touch them, and the yacht industry in the US collapsed.

So not only did the expected tax revenue increases not appear but the revenue being brought in at the time dried up as well. Not only that but the income taxes being paid by employees also stopped but turned into outlays of food stamps and unemployment payments.

[Mountain Man]

Then there was the state of New York that attempted to plug a hole in its budget by raising taxes on the rich, so a significant number of rich people moved, and the budget hole was even bigger the next year.

[Sparko]

Track it over the next couple years. That "boost" you just got is designed to fade.

And your $400 gain is a fraction of 1% (unless you make less than $40K). Compare that to the almost 3% gain the wealthiest got on average.

You're being duped, Sparko.

So you just posted a thread claiming that the tax break was a fraud, and I showed you that it wasn't and I am the one being duped?

I don't know about you, but I think getting a couple of thousand dollars extra is nothing to sneeze at. And since you are one of "the wealthiest" that you say got an even bigger tax break, you should be even happier. If you don't like your extra money, feel free to donate it to me.

[carpedm9587]

So you just posted a thread claiming that the tax break was a fraud, and I showed you that it wasn't and I am the one being duped?

Fraud? I think the message I have been putting forward is that it's a con. The tax break gives out dribbles to the lower and middle class, and buckets to the wealthy and upper class. The former keeps people like you going "yeah Trump" while they dance all the way to the bank. $400? Are you kidding me? As much as you may be welcoming just slightly over a dollar a day of improvement, the wealthy are making out like bandits both in terms of raw numbers AND percentages.

I don't know about you, but I think getting a couple of thousand dollars extra is nothing to sneeze at. And since you are one of "the wealthiest" that you say got an even bigger tax break, you should be even happier. If you don't like your extra money, feel free to donate it to me.

I'm not happy when things are not equitable - whatever my situation (on the top or on the bottom). I am especially not happy when the whole thing comes at the cost of 10-digit deficits. But I have to admit I truly do not understand people like you who cheer at being taken for a ride. It just defies the imagination. Not to mention - how did you go from "$400" to "a couple of thousand?"

[Sparko]

Fraud? I think the message I have been putting forward is that it's a con.

Tomato, Tomahto.

The tax break gives out dribbles to the lower and middle class, and buckets to the wealthy and upper class. The former keeps people like you going "yeah Trump" while they dance all the way to the bank. $400? Are you kidding me? As much as you may be welcoming just slightly over a dollar a day of improvement, the wealthy are making out like bandits both in terms of raw numbers AND percentages.

$400 was just the amount my taxes were lower than last year, AFTER also getting a raise. And that was a significant portion of my overall tax burden (around a 10% reduction)

I'm not happy when things are not equitable - whatever my situation (on the top or on the bottom). I am especially not happy when the whole thing comes at the cost of 10-digit deficits. But I have to admit I truly do not understand people like you who cheer at being taken for a ride. It just defies the imagination. Not to mention - how did you go from "$400" to "a couple of thousand?"

I took home over the course of the year ~ $2000 extra in my take-home pay compared to last year. Part was because of the lower taxes and part because of a raise I got.

[carpedm9587]

Tomato, Tomahto.

Then I do not understand your use of "fraud."

$400 was just the amount my taxes were lower than last year, AFTER also getting a raise. And that was a significant portion of my overall tax burden (around a 10% reduction)

So - if you saw a 10% reduction in taxes, you are WAY off the scale for the norm - and I have no idea why. I can see why you are dancing, but you are an anomaly according to the statistics we are seeing. Your personal experience is not reflective of the overall law.

I took home over the course of the year ~ $2000 extra in my take-home pay compared to last year. Part was because of the lower taxes and part because of a raise I got.

And now I see why. You are conflating apples and oranges. How big was your raise (rhetorical question I don't expect you to answer)? You have to subtract that from the $2K number to see what your actual tax reduction was. If you wanted to be even more accurate, you would need to either compare what your:

1) 2017 taxes would have been if you had made your 2018 salary in 2017 with the 2018 taxes resulting from your new 2018 salary, or
2) 2018 taxes would have been if you had made your 2017 salary in 2018 with the 2017 taxes you actually paid

In other words, you need to compare the taxes for the same salary in the two years. You're mixing up a lot of numbers and not getting an accurate reflection of the impact of the tax cut.

[Sparko]

Then I do not understand your use of "fraud."

Con, Fraud, it's the same thing. I don't understand your correction of my term.

So - if you saw a 10% reduction in taxes, you are WAY off the scale for the norm - and I have no idea why. I can see why you are dancing, but you are an anomaly according to the statistics we are seeing. Your personal experience is not reflective of the overall law.

I am middle of the road on middle class income. I am single, I own a house and a car. I have no special deductions. I ended up taking the standard deduction. Perhaps your data is incorrect?

And now I see why. You are conflating apples and oranges. How big was your raise (rhetorical question I don't expect you to answer)? You have to subtract that from the $2K number to see what your actual tax reduction was. If you wanted to be even more accurate, you would need to either compare what your:

1) 2017 taxes would have been if you had made your 2018 salary in 2017 with the 2018 taxes resulting from your new 2018 salary, or
2) 2018 taxes would have been if you had made your 2017 salary in 2018 with the 2017 taxes you actually paid

In other words, you need to compare the taxes for the same salary in the two years. You're mixing up a lot of numbers and not getting an accurate reflection of the impact of the tax cut.

If I made the same as I did last year, my taxes would have been even LOWER than they were this year, Carp. So I would have gained even MORE than 10% tax reduction. The fact that I made $2,000 more in taxable income after deductions AND still saved 10% in tax burden over last year shows that the tax reduction is a real thing. If I made less my tax burden would have even been lower.

[rogue06]

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[Mountain Man]

I'm not happy when things are not equitable...

Aren't you the one who always says "That's not fair!" Is the cry of a toddler?

[carpedm9587]

Con, Fraud, it's the same thing. I don't understand your correction of my term.

Fraud: wrongful or criminal deception intended to result in financial or personal gain.
Con: persuade (someone) to do or believe something, typically by use of a deception.

I was using the definition of "con" above. Upon reading both definitions, however, I guess I would describe the Trump Tax Cut as both a con and a fraud. Both involve deception. Indeed, perhaps fraud is a better word, given that it implicitly refers to "financial or personal gain." That seems to describe what was done aptly.

So I withdraw my comment. Either term will do.

I am middle of the road on middle class income. I am single, I own a house and a car. I have no special deductions. I ended up taking the standard deduction. Perhaps your data is incorrect?

You're attempting to claim that the data that describes the median effect of the tax cut on Americans is incorrect because you were not at the median?

If I made the same as I did last year, my taxes would have been even LOWER than they were this year, Carp. So I would have gained even MORE than 10% tax reduction.

First, you actually haven't shown a 10% reduction, given that you apparently included your raise into the calculation. Second, "would have been lower" is not a universally true statement; it depends on whether you cross any tax brackets, and if there are any impacts on your deductions. Finally, your use of statistics makes me wonder about your math. How are you arriving at 10%? What numbers are you dividing?

The fact that I made $2,000 more in taxable income after deductions AND still saved 10% in tax burden over last year shows that the tax reduction is a real thing. If I made less my tax burden would have even been lower.

The fact that you had $2,000 more in taxable income is a function of both your raise and the changes in deductions from last year to this year, so you continue to mix numbers up, making it impossible to know what the tax cut actually did for you. And your use of it in this context suggests that you statement about a 10% reduction in taxes is probably not correct.

I realize that you are not going to post your tax return here - nor share it with anyone - but your numbers aren't making any sense to me. Perhaps they are to someone else.

[carpedm9587]

Aren't you the one who always says "That's not fair!" Is the cry of a toddler?

I am. I don't recall using "that's not fair" as an objection to any specific claim or a reason for anyone making a change. I noted my mental state when there is an injustice at play. If someone asks me why I think the tax cut needs to be reversed, "because it's not fair," will not be one of my reasons. My reasons will be based in the impact on the tax cut on individuals, the economy, and the federal deficit. "It's not fair" presumes everything is supposed to be "fair" in some simplistic balancing act. It is indeed the call of outrage of a any simple thinker (i.e., a toddler).