The Observation Deck

ryan costa wrote:How much of the federal deficit is being masked by robbing the social security surplus this year?

Do unemployment stats mean anything? I've never reported myself unemployed or registered for any unemployment programs, despite frequent periods of unemployment.

Can Bush be taken seriously every time he claims to want to cut taxes and shrink the deficit?

Are mortgage defaults and credit card defaults up?

Are states and corporations robbing pension funds faster than ever?

Are the statistics you mentioned a misleading sham?

I don't know what income bracket you are in. If you make under 80 grand a year you are paying more taxes than you were before reaganomics(adjusted for inflation). Considering social security taxes are just regressive income taxes that are supposed to be earmarked for social security programs(but are instead robbed to partially mask a few hundred billion of the federal deficit each year). But straight income taxes on most Americans have also risen since the Reaganomics era. Government spending and size has greatly increased during and since the Reagan Era, despite the slogans.

http://www.letxa.com/articles/9

IRS data shows that in 2004, the richest 50% of the taxpayers paid 96.7% of all income taxes. From 1986 to 2004, the share paid by the richest half increased from 93.5% to 96.7%, and the share paid by the richest 1% increased from 25.75% to 36.89%. At the same time, the amount paid by the poorer half decreased from 6.5% in 1986 to 3.3% in 2004. While the poor's contribution was cut in half, the richest Americans saw their contribution increase by nearly 50%. When you get past the propaganda, for the last two decades the rich have been paying more and more while the poor have been paying less and less.

To put it simply, of the $832 billion in personal income taxes collected in 2004, the richest half of the country paid $804 billion while the poorest half only paid $27.4 billion.

Those that make the claim "the tax cuts help the rich" will claim that the reason why the rich paid so much more in taxes is because they made so much more money. There is truth to that, though the progressive nature of the tax code also insures that the rich pay more than they should, proportionally speaking. However, the reason for the rich paying so much more is irrelevant to this discussion: If the "rich" are paying 96.7% of the income taxes and the poor are only paying 3.3%, then it's simply common sense that most of any income tax cut will benefit those that are paying it. You can't reduce taxes on someone who isn't paying any.

Are the poor paying taxes? In 2005, a family of four was considered to be at the poverty level if they earned less than $19,350 . If you complete a 2005 1040 considering an income of $19,350 and four family members, you will find that the standard deduction for the couple is $10,000, and an additional $3200 deduction is given for each of the four family members for an additional $12,800. So, in all, the family earning $19,350 has $22,800 in income deductions which means they pay no federal tax. In fact, a family of four will not pay a single dollar in federal tax until the family earns at least $22,800. Since these people pay no taxes whatsoever, a tax cut will obviously not be of any direct benefit to them since they aren't paying taxes to start with. This doesn't make the tax cut a bad idea, but it stands to reason that it won't directly benefit anyone that isn't paying taxes any more than a price reduction in milk won't help anyone that isn't buying milk.

A sign of a healthy economy would be de-industrialized areas still industrialized. A sign of a healthy economy would be the absence of oil addiction(absence of 90 percent of housing subdivisions and shopping centers and small scale exurban industrial parks built in the last 20 years).

reaganomics

How much of the federal deficit is being masked by robbing the social security surplus this year?

"It is a paradoxical truth that tax rates are too high and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now ... Cutting taxes now is not to incur a budget deficit, but to achieve the more prosperous, expanding economy which can bring a budget surplus."

"Lower rates of taxation will stimulate economic activity and so raise the levels of personal and corporate income as to yield within a few years an increased – not a reduced – flow of revenues to the federal government."

"It is no contradiction – the most important single thing we can do to stimulate investment in today's economy is to raise consumption by major reduction of individual income tax rates."