President Proposes to Lower Taxes

[Lootifer]

following interesting thread.

also you seem to be asking for it in this thread tgd; considering most people dont understand why we have a graduated tax system in the first place (marginal value of wealth) let alone know what is and is not possible with regards to tax law/creative accounting/whatever-you-would-like-to-call-it, any intelligent discussion is going to be rather rare.

Ultimately I was trying to figure out what the cross-sections thought about the president's plan. Here was my theory:

Republicans (Phatscotty, Night Strike) - Sucks because Obama
Libertarians (me, BBS) - Okay, but corporate cronyism and probably ineffective
Democrats (Player) - Great because Obama
Liberals (Lootifer) - ?

And after I confirmed my theory I was going to ridicule the Republicans and Democrats and try to figure out where you and your ilk would be on this.

I wasn't trying to get into my tenth debate about the headline "BIG COMPANY DOESN'T PAY TAX" by having to explain how that headline is false. I should have known better.

I readily admit I dont know enough about the tax system to understand what some kind of high level change like this will play out.

I am ok with 30%+ corporate tax* if it is being effectively applied uniformly - thou 35% does seem high even for me. So in the case of both Coke and Joes Locally Brewed Cola Co. paying 30-35% on their actual** profits then I would generally oppose the reduction in consideration of you current government deficit.

However if the reality of the situation is, as Obamas rhetoric would have you believe, that Coke is paying 1c in every dollar and its only really Joes Locally Brewed Cola Co. thats paying 35% and this change will work to alliviate that to some extent then I am in favour of the change.

* corporate tax is a gnarly one as it tends to lead to some odd effects when coupled with income tax and other ones; I havent thought much about this so cant comment.
** actual profits are profits prior to creative accounting for the purposes of discussion.

[Teflon Kris]

You say a lot without saying much. I guess you fit your name well.

I'll take that as agreement of the obvious facts.

You didn't list many "obvious facts" in that post, frankly.

I take it you must agree with the non-obvious facts and would advise asking yourself questions about the world we live in.

Had I realised the obvious isnt so obvious to the brainwashed I would have happily listed some examples for you.

[Teflon Kris]

The fact that GE may pay tax in one country and not the other does not make that company a tax dodger, despite all the choice media you've imbibed. I would urge you to become more educated about these types of things if you expect to continue to vote and make political choices based upon your faulty data.

So, first you say tax avoidance doesn't exist, now you admit it does.

Country A charges 30%. 30% of 1M profit is 300K

Country B charges 15%. I'm sure you can make the next calculation.

By moving money from the place where the customers paid (A), to the small office (B), 150K of savings are made (and Government A gained 150K for nothing, Government B lost 300K and had the p*ss ripped out of them for their infrastructure investment and general corporate ass-l*cking).

We're not arguing about whether tax avoidance is legal. Even if it were illegal, the penalties would be sod-all and the individuals taking the decisions would easily move to cushy jobs elsewhere doing the same thing, or in government turning a blind eye to it (e.g. the reward for those involved in the credit rating abuse that resulted in the 07-08 crash). Greed for the elite is rewarded, greed by the masses is heavily punished.

We are arguing about tax avoidance.

So the 150K not paid, what is it, if its not dodged or avoided??

Dont tell me, the Will of God - he asked the accountants to create the small office and virtually move money there (then into the executives bonus accounts) - God bless 'Merica.

By the way, when you guys vote the choice is only minutely political.

[thegreekdog]

following interesting thread.

also you seem to be asking for it in this thread tgd; considering most people dont understand why we have a graduated tax system in the first place (marginal value of wealth) let alone know what is and is not possible with regards to tax law/creative accounting/whatever-you-would-like-to-call-it, any intelligent discussion is going to be rather rare.

Ultimately I was trying to figure out what the cross-sections thought about the president's plan. Here was my theory:

Republicans (Phatscotty, Night Strike) - Sucks because Obama
Libertarians (me, BBS) - Okay, but corporate cronyism and probably ineffective
Democrats (Player) - Great because Obama
Liberals (Lootifer) - ?

And after I confirmed my theory I was going to ridicule the Republicans and Democrats and try to figure out where you and your ilk would be on this.

I wasn't trying to get into my tenth debate about the headline "BIG COMPANY DOESN'T PAY TAX" by having to explain how that headline is false. I should have known better.

I readily admit I dont know enough about the tax system to understand what some kind of high level change like this will play out.

I am ok with 30%+ corporate tax* if it is being effectively applied uniformly - thou 35% does seem high even for me. So in the case of both Coke and Joes Locally Brewed Cola Co. paying 30-35% on their actual** profits then I would generally oppose the reduction in consideration of you current government deficit.

However if the reality of the situation is, as Obamas rhetoric would have you believe, that Coke is paying 1c in every dollar and its only really Joes Locally Brewed Cola Co. thats paying 35% and this change will work to alliviate that to some extent then I am in favour of the change.

* corporate tax is a gnarly one as it tends to lead to some odd effects when coupled with income tax and other ones; I havent thought much about this so cant comment.
** actual profits are profits prior to creative accounting for the purposes of discussion.

The confusion in the last sentence (not counting starred items) is that Coke's profits are global and Joe's Locally Brewed Cola's profits are U.S.-only. So, Coke can make billions and billions and billions and show little U.S. tax, but is paying lots of non-U.S. tax.

In any event, U.S. federal taxes lean heavily towards the big guy, what with the various tax preference items. I would never deny that.

[thegreekdog]

The fact that GE may pay tax in one country and not the other does not make that company a tax dodger, despite all the choice media you've imbibed. I would urge you to become more educated about these types of things if you expect to continue to vote and make political choices based upon your faulty data.

So, first you say tax avoidance doesn't exist, now you admit it does.

Country A charges 30%. 30% of 1M profit is 300K

Country B charges 15%. I'm sure you can make the next calculation.

By moving money from the place where the customers paid (A), to the small office (B), 150K of savings are made (and Government A gained 150K for nothing, Government B lost 300K and had the p*ss ripped out of them for their infrastructure investment and general corporate ass-l*cking).

We're not arguing about whether tax avoidance is legal. Even if it were illegal, the penalties would be sod-all and the individuals taking the decisions would easily move to cushy jobs elsewhere doing the same thing, or in government turning a blind eye to it (e.g. the reward for those involved in the credit rating abuse that resulted in the 07-08 crash). Greed for the elite is rewarded, greed by the masses is heavily punished.

We are arguing about tax avoidance.

So the 150K not paid, what is it, if its not dodged or avoided??

Dont tell me, the Will of God - he asked the accountants to create the small office and virtually move money there (then into the executives bonus accounts) - God bless 'Merica.

By the way, when you guys vote the choice is only minutely political.

How do you move the money from Place A to Place B?

[Lootifer]

The confusion in the last sentence (not counting starred items) is that Coke's profits are global and Joe's Locally Brewed Cola's profits are U.S.-only. So, Coke can make billions and billions and billions and show little U.S. tax, but is paying lots of non-U.S. tax.

In any event, U.S. federal taxes lean heavily towards the big guy, what with the various tax preference items. I would never deny that.

Not sure I understand this bit.

Do you mean that the US favours big business with tax breaks etc.?

[thegreekdog]

The confusion in the last sentence (not counting starred items) is that Coke's profits are global and Joe's Locally Brewed Cola's profits are U.S.-only. So, Coke can make billions and billions and billions and show little U.S. tax, but is paying lots of non-U.S. tax.

In any event, U.S. federal taxes lean heavily towards the big guy, what with the various tax preference items. I would never deny that.

Not sure I understand this bit.

Do you mean that the US favours big business with tax breaks etc.?

Yes.

[Teflon Kris]

How do you move the money from Place A to Place B?

I credit you with more intelligence than requiring an answer.

there are many ways.

As long as the wet lettuces of world governments deliberately introduce flimsy measures to minimise corporate money-shifting excuses, excessively-paid accounting 'executives' can easily use a microscopic proportion of the average human creative intelligence to create new excuses. All they then need to do is instruct administrators and 'budget holders' to label budget spreadsheets accordingly, go on holiday 'work from home' for most of the year and drop back in to head office at the end of the year to check electronic paperwork is 'correctly' completed.

As long as the spreadsheet transfers are labelled correctly they can then hopefully get head-hunted by Barclays or Starbucks.

[Woodruff]

You say a lot without saying much. I guess you fit your name well.

I'll take that as agreement of the obvious facts.

You didn't list many "obvious facts" in that post, frankly.

I take it you must agree with the non-obvious facts and would advise asking yourself questions about the world we live in.
Had I realised the obvious isnt so obvious to the brainwashed I would have happily listed some examples for you.

Honestly, you come across as the brainwashed. Your very first statement in that post is ludicrous on the face of it, and clearly shows that the rest of the post should be taken with a grain of salt as partisan rhetoric (and very poorly conceived rhetoric at that).

[Teflon Kris]

You say a lot without saying much. I guess you fit your name well.

I'll take that as agreement of the obvious facts.

You didn't list many "obvious facts" in that post, frankly.

I take it you must agree with the non-obvious facts and would advise asking yourself questions about the world we live in.
Had I realised the obvious isnt so obvious to the brainwashed I would have happily listed some examples for you.

Honestly, you come across as the brainwashed. Your very first statement in that post is ludicrous on the face of it, and clearly shows that the rest of the post should be taken with a grain of salt as partisan rhetoric (and very poorly conceived rhetoric at that).

So, you are admitting I did say something?

A minute ago you said I said nothing.

So, what is this 1st fact that you claim is incorrect?

[Woodruff]

You say a lot without saying much. I guess you fit your name well.

I'll take that as agreement of the obvious facts.

You didn't list many "obvious facts" in that post, frankly.

I take it you must agree with the non-obvious facts and would advise asking yourself questions about the world we live in.
Had I realised the obvious isnt so obvious to the brainwashed I would have happily listed some examples for you.

Honestly, you come across as the brainwashed. Your very first statement in that post is ludicrous on the face of it, and clearly shows that the rest of the post should be taken with a grain of salt as partisan rhetoric (and very poorly conceived rhetoric at that).

So, you are admitting I did say something?

I never said you didn't say anything. I said you didn't state many facts.

A minute ago you said I said nothing.

I did nothing of the sort.

So, what is this 1st fact that you claim is incorrect?

There were no facts for which I could claim were incorrect. Is English your second language or something?

[Teflon Kris]

Your very first statement in that post is ludicrous on the face of it, and clearly shows that the rest of the post should be taken with a grain of salt as partisan rhetoric (and very poorly conceived rhetoric at that).

So, what is this 1st fact that you claim is incorrect?

There were no facts for which I could claim were incorrect. Is English your second language or something?

So, according to your non-logic, my statement was incorrect but there were no facts !!!! So you still refuse to state what you dont agree with. Practising to be a politician wont help you become one you know, its a pointless exercise here.

This is pure illogical rubbish: for a statement to be correct or incorrect it must contain facts (or what claims to be facts) you dimwit. If there is nothing that could be incorrect then the statements wouldn't be statements they would be fiction.

So brainwashed that you guys cant even be logical for once.


N.B. Dodgy grammar in 1st quote above, just as in my last sentence. Logic is certainly not your first, second, or indeed any of your languages. Not sure what your ESOL reference is to, but the reference is a good example of capitalist ladder ideology and values mentioned above: the myth of the superiority of a wide vocabulary and perfect grammar helps keep the rich kids at the top and creates a barrier to make it harder for the masses to progress (such as through the game of pretending to be posh at management interviews). Language is a capitalist weapon and is part of the reason for anglophonic capitalism being the most extreme large-scale scheme. More logical and less complex languages do not require as much exposure to posh culture and registers to gain mastery. Therefore in European and Asian countries language is less of a barrier to prevent too many of the talented amongst the masses to progress.

[Teflon Kris]

'The Best' - take George Bush as an example. Really thick rich kid - he should be at the bottom of the ladder.

I don't know what thick means in the 51st state, but here in the other 50 states, it means stupid. I'm pretty sure President Bush II was a war mongerer, corporate crony, and generally horrible president, but I'm also pretty sure he was not thick.

Well, without any of his test scores to hand we will have to agree to disagree (dont tell me you think Reagan wasnt thick either ).

So, how is he 'the best' then? As a corporate crony (to say the very least) he is the perfect example of government not doing what you claim it does in your wonderful free market 'natural' world.

[thegreekdog]

How do you move the money from Place A to Place B?

I credit you with more intelligence than requiring an answer.

there are many ways.

As long as the wet lettuces of world governments deliberately introduce flimsy measures to minimise corporate money-shifting excuses, excessively-paid accounting 'executives' can easily use a microscopic proportion of the average human creative intelligence to create new excuses. All they then need to do is instruct administrators and 'budget holders' to label budget spreadsheets accordingly, go on holiday 'work from home' for most of the year and drop back in to head office at the end of the year to check electronic paperwork is 'correctly' completed. As long as the spreadsheet transfers are labelled correctly they can then hopefully get head-hunted by Barclays or Starbucks.

Everything in red is illegal for which whomever implements these items would be arrested and the company heavily fined. I'm incredibly intelligent and have already provided an answer, namely that you can't do what you're proposing companies do.

Want to try again?

[thegreekdog]

'The Best' - take George Bush as an example. Really thick rich kid - he should be at the bottom of the ladder.

I don't know what thick means in the 51st state, but here in the other 50 states, it means stupid. I'm pretty sure President Bush II was a war mongerer, corporate crony, and generally horrible president, but I'm also pretty sure he was not thick.

Well, without any of his test scores to hand we will have to agree to disagree (dont tell me you think Reagan wasnt thick either ).

So, how is he 'the best' then? As a corporate crony (to say the very least) he is the perfect example of government not doing what you claim it does in your wonderful free market 'natural' world.

I don't know if Reagan was intelligent or not. He was a good public speaker and I enjoyed some of his policies, although I doubt he invented them by his lonesome. But yeah, we won't know who's the smartest without test scores. I personally think President Clinton was the most intelligent president of my lifetime, but, again, who knows?

I'm pretty sure I didn't label President Bush II "the best." Let me check.

thegreekdog checks

Nope. I labelled him a generally horrible president.

I'm also not claiming the government does anything and it most certainly is not providing a free market through its tax system.

Do you want to try again here too? What are you getting at? What is your ideal tax structure? What presidents did you like? Why? Do we want to get into that here or are you going to post non-sensical things repeatedly until you get bored?

* As a related aside, I think there needs to be a glossary thread to point new or ignorant users to the views of other users. This would help in avoiding me having to explain my position on 500 different issues and it would also help pin Phatscotty down.

[Woodruff]

Your very first statement in that post is ludicrous on the face of it, and clearly shows that the rest of the post should be taken with a grain of salt as partisan rhetoric (and very poorly conceived rhetoric at that).

So, what is this 1st fact that you claim is incorrect?

There were no facts for which I could claim were incorrect. Is English your second language or something?

So, according to your non-logic, my statement was incorrect but there were no facts !!!! So you still refuse to state what you dont agree with. Practising to be a politician wont help you become one you know, its a pointless exercise here.

Alternatively, you could point out which facts were present in your post. I see that you have tried very hard to avoid pointing out which of your statements in that post are facts. I'm pretty sure I know the reason why you've avoided that, but it's interesting, nonetheless.

This is pure illogical rubbish: for a statement to be correct or incorrect it must contain facts (or what claims to be facts) you dimwit. If there is nothing that could be incorrect then the statements wouldn't be statements they would be fiction.

Speaking of pure illogical rubbish, were you going to point out which statements in that post "contains facts"?

Stop trying to live up to your name, Teflon.

[Lootifer]

* As a related aside, I think there needs to be a glossary thread to point new or ignorant users to the views of other users. This would help in avoiding me having to explain my position on 500 different issues and it would also help pin Phatscotty down.

I concur but I think we might need a test.

Maybe a whole bunch of political compass charts

[BigBallinStalin]

(4) This attack on companies that "stash their money abroad" is very misleading. I've gone on this diatribe before, but I'll make it short. If a company makes money in the United States, it's taxed in the United States. If a subsidiary company makes money in Ireland, it's taxed in Ireland. If the subsidiary company attempts to distribute that money to the parent company in the United States, that same money that was taxed in Ireland is taxed again in the United States. There is no U.S. company in existence that makes money in the United States and then stashes that money overseas.

I'm confused. I thought there were indeed places (countries) that don't have such taxes.

I am too. I remember a Forbes article.

Edit: U.S. Companies Stashing More Cash Abroad As Stockpiles Hit Record $1.45T (3/19/2013)

In 2012, U.S. non-financial companies filled their coffers with an additional $130 billion, taking their total cash to a record $1.45 trillion as the economy has stagnated and the labor market has moved sideways. At the same time, a prohibitive corporate tax scheme coupled with emerging market growth have pushed U.S. firms to keep 58% of their cash, or $840 billion, overseas.

List

Unless TGD means all their money, then that seems true.


--Andy

They're stashing cash in various countries, but not exactly moving it from country to country--without incurring additional taxes.

They're stashing so much cash because the profitability of further investments looks dim/not good enough. This is due to "regime uncertainty" (i.e. new changes in the rules of the game brought about by changes in regulation), general lackluster market activity (so it seems), and the banks not finding more worthy businesses to lend to (and those banks are faced with increasing capital/equity requirements, which hampers their desire to extend more loans).

Also, banks need to learn how to capture more niche markets, which requires learning how to capture more local knowledge.

I'd say more, but in short, what's been going on for the past 5 years has been insane, and the repercussions are looming.

[BigBallinStalin]

The confusion in the last sentence (not counting starred items) is that Coke's profits are global and Joe's Locally Brewed Cola's profits are U.S.-only. So, Coke can make billions and billions and billions and show little U.S. tax, but is paying lots of non-U.S. tax.

In any event, U.S. federal taxes lean heavily towards the big guy, what with the various tax preference items. I would never deny that.

Not sure I understand this bit.

Do you mean that the US favours big business with tax breaks etc.?

Yes.

So, their marginal tax rates will be lower than most smaller businesses' tax rates.

Why did this happen? Because special interest politics. Groups lobby to get various tax credits, deductions, subsidies, etc., and the politicians willingly oblige them.

So, we face a fundamental problem: "closing LOOPHOLES" (Or really, previously crafted shitty legislation from the very politicians themselves). Since the problem is due to crony capitalism, then you'd need to change the rules of the game from crony capitalism--i.e. you'd need to eliminate that incentive. This means we'd have to reduce the power of the federal government and its regulators, from which select companies gain their benefits.

And how is that accomplished? Through the current forms of governance? Nope. (Sorry, Woodruff, but it's too profitable for politicians to 'close those loopholes'. Their rhetoric should be ignored because it's really not what they want).

Much of that kind of legilsation is intertwined. It's similar to the complexity of the embargo on Cuba. It's intertwined with many distinct bills/laws along with various riders (small sentences/paragraphs) in seemingly unrelated bills.

It's like a difficult game of Jenga which none of the politicians would ever want to play. Occasionally, some remarks are made about how fun that game of Jenga would be, but then they shy away from it immediately while collecting their checks from the corporate donors.

Fun, fun, fun. But hey, Obama is awesome cuz lower taxes, herpderp.

[Lootifer]

Reducing the power is only one way to skin the cat; you can achieve the same end by changing the culture of special interest politics as well.

I mean I am not saying reducing the power isnt a good thing, but to me a corrupt government (and I see any government that plays special interest politics as corrupt) is a bad thing regardless of how powerful it is. Thats the core issue here; if the government lacks corruption then any political position will flourish (sure sure, some are more efficient than others...).

Fix corruption, then lets debate left vs right.

edit: oh and for the record, corruption is like bigotry, i feel there are situations where there is "good corruption", but so long as the policy is transparently derived and something the population wants (like, say, feeding the homeless, seeing as the homeless are technically a special interest group) then I have no problem with it.

[thegreekdog]

Reducing the power is only one way to skin the cat; you can achieve the same end by changing the culture of special interest politics as well.

I mean I am not saying reducing the power isnt a good thing, but to me a corrupt government (and I see any government that plays special interest politics as corrupt) is a bad thing regardless of how powerful it is. Thats the core issue here; if the government lacks corruption then any political position will flourish (sure sure, some are more efficient than others...).

Fix corruption, then lets debate left vs right.

edit: oh and for the record, corruption is like bigotry, i feel there are situations where there is "good corruption", but so long as the policy is transparently derived and something the population wants (like, say, feeding the homeless, seeing as the homeless are technically a special interest group) then I have no problem with it.

Careful. You're starting to sound like me and BBS.

Needless to say I agree with BBS's post (and it would be needless to say if we had a frigging glossary or index or something). I tihnk another rather large component of this is the lack of information and the prevelance of ignorance. For example, I suspect most people in the United States do not understand or do not acknowledge even if they may understand rent-seeking when it comes to taxes (nevermind any other regulatory-type laws in the United States). I always try to point to state taxes as a better indicator of rent-seeking. If you look for a state with a large corporation headquartered therein (or with significant operations), chances are you'll find some beneficial tax legislation with respect to that corporation. We see that in Pennsylvania when the Marcellus Shale was open for business - all of the sudden, favorable tax laws and rulings came down for the drillers. It was a fascinating thing to see and was largely ignored because, well, a Democratic legislature and a Democratic governor would never favor big business and a Republican legislature and a Republican governor just want to decrease taxes (even though it may not be decreased taxes for the average Joe and may result in higher taxes for the average Joe). When the government and the media controls the message, ignorance is prevelant.

[Lootifer]

Haha yeah. But I always end up mostly agreeing with you guys anyway since the practical situation means left vs right debate is moot most of the time.

E.g. we cant really have a good debate on the presidents plans since its almost certainly some political play to draw in uninformed centre right voters (probably without any research or analysis backing the policy)

[BigBallinStalin]

Reducing the power is only one way to skin the cat; you can achieve the same end by changing the culture of special interest politics as well.

I mean I am not saying reducing the power isnt a good thing, but to me a corrupt government (and I see any government that plays special interest politics as corrupt) is a bad thing regardless of how powerful it is. Thats the core issue here; if the government lacks corruption then any political position will flourish (sure sure, some are more efficient than others...).

Fix corruption, then lets debate left vs right.

edit: oh and for the record, corruption is like bigotry, i feel there are situations where there is "good corruption", but so long as the policy is transparently derived and something the population wants (like, say, feeding the homeless, seeing as the homeless are technically a special interest group) then I have no problem with it.

Oh yeah, culture matters. For sure. It's the fundamental driver of opinion and change.

However, there's this stumbling block which if alleviated would be corrected, and that is education. People simply don't know how the government + its beneficiaries operate. The problem is systemic--it reaches into post-grads ffs. However, even someone without high school education can understand what we're talking about. It's about 'spreading that message' while trying to compete with much more effective and efficient... idiots, to put it simply (e.g. mainstream media, politicians themselves, etc.).

Education is key, yet too many people lack the self-discipline to educate themselves about these matters. And as already mentioned, many colleges and grad schools simply ignore, lightly dust upon, or insufficiently address the fundamental problems of their programs (e.g. presuming that politicians are selfless individuals who costlessly seek the optimal path toward 'progress').

There's more problems too, but generally, when I look at the US, I (1) either want to go away and establish my own farm/productive land in the mountains with my close friends to get away from everything, or (2) stick within cities and the relevant circles to 'continue the good fight'--which it is. At first, it sounded silly, but after several years of learning, talking, and reading, the problems of this country are too large to ignore.

Tangentially, I see the US as spiraling toward its own demise--like the Ottoman Empire: enough people understood the long-term problems, but it was too politically profitable to go with the short-term in exchange for letting it crumble. Hopefully, that can be averted, and if not, I'll move away to somewhere more reasonable and environmentally aesthetic (e.g. New Zealand or Australia. My Chinese and English will get me by).

[Lootifer]

I completely agree that education is the key issue. The best vehicle for it is obviously the internet, but unfortunately humans being the retards we are have decided that 4chan rules and TED sucks; I mean even I struggle to bother watching TED articles and other interesting pieces; and I am into this kind of boring crap, lord knows how hard it would be to get the general population engaged.

Eh Australia is already heading the same way, and I dont see anything stopping NZ following suit. I just hope it happens after I die.