Did you know that....

[KeithE]

State and Local Taxes are usually regressive (lowest wage earners pay more % of their income to state and local taxes than the wealthy).





It is still true that the top wage earners pay more state/local taxes in terms of amounts and the Federal taxes are progressive. So overall there is a redistribution from rich to poor in this country (as it should be, imo). But most countries do far more in terms of redistribution through taxes and transfers (SS,unemployment, food/housing assistance). In fact we are the worst in terms of the resultant inequality among the developed world.



OK that chart didn’t copy well. Look at the 6th chart down in as well as the other charts.

Chart 4 shows how inequality has grown during the recovery. Top 10% incomes rose 2%, while middle income families (40-60%) income have fallen by 6% and lower/middle income families (20-40%) have fallen by 7%.

Chart 5 shows a Piketty analysis that show how the Top 1% and Top .01% have seen skyrocketing incomes beginning in 1980.

And the 113th Congress to the banking industry (and thus their executives that average over $10M/year salary) via adding a provision to the last second keep-govt-going bill curtailing the Dodd-Frank reforms. Many in the 114th Congress intend to complete that dismantling with .

This has got to end. And .

[Cathy]

I also found that set of charts very interesting and linked it on Facebook. I see the stagnation of wages in the poor and middle class as a major problem in this country.

I found this article encouraging.

Inclusive capitalism

http://www.nytimes.com/2015/01/21/opini ... pe=article

[Dave Roberts]

There are no surprises at all in the regressive nature of state and local taxation. There are several reasons.
1. State taxes are based on sales tax, vehicle registrations, incense and ID fees, and state income taxes that usually do not exceed 7 to 10 percent rates, even for the highest earners.
2. Local taxes are based on property taxes, vehicle taxes (as personal property), license fees, local vehicle registrations, and service fees such as trash pickup, utility fees, and meals and room taxes.
3. Local taxes are intended to hit all, even at the poorest levels, but often exempt large farming tracts or tax them at lower rates. I am aware of as many as ten houses locally built on a large farm and all taxed at far lower rates because the whole property is classed as farmland.
4. In the bidding wars for business and industry, exemptions are often given to large companies to get them to locate in an area, and often these may last 10 to 25 years, burdening the rest of the limited tax base with higher taxes to make up for those premiums given as business subsidies for which someone has to pay. Even if the business closes, the properties usually retain those exemptions or reductions for the agreed term.

[KeithE]

[Cathy]

Dave leaves off the "I" in the "SSI" pay roll "tax". I have always disagreed with applying the deduction to the entire income being the answer to saving SSI or balancing the budget. And I have stated that on this site before. I'd rather they just raised the taxes as needed to upper income earners. SSI is a no opt out annuity program. I don't see it as a tax in the true sense. Two earner married couples already pay a larger share for their potential return, because they do not both get the full allotment they paid for. Another price you pay for the privilege of marriage.

I believe lower income retirees receive a higher check relative to their payments into the system than those who pay the top rates.

Since it is still refer to it as SSI, I don't consider it regressive as it regards income. Fair? Not with the huge marriage penalty.

My widowed Aunt and her new "partner" had a service at a UMC a couple years ago. but didn't do papers at the courthouse and they both get their full check. They also had legal papers drawn up to define their relationship and I think to keep their estates separate for their families. So they get their two full SSI checks.

Our taxes are complicated enough. Just raise the top income tax rates to meet the funding needs and avoid further complexity.

We need tax reform. Eliminate the alternative minimum tax. How do you make up for that? Raise the tax rates at the upper income levels.

I agree with additional estate taxes as proposed.

[KeithE]

[Tim Bonney]

Keith,

How do you feel about how estate taxes effect farmers? People in farm communities have long been concerned about the idea of being charged to continue to live on the farm you've lived on and worked all your life just because your parents died.

[KeithE]

[William Thornton]

Keeping a farm or business in the family may be impossible. "Tough" sayeth the progressive who feels gummit should apply the death tax. The father or mother builds. The children work. The gummit takes. We can't have people around here who inherit wealth on which taxes were already paid. Seize it!

Tax spending. Tax consumption. Then if the profligate prodigals go on a spending spree with all that inherited wealth, gummit may have a portion of it.

[Tim Bonney]

[Dave Roberts]

I did not use SSI initials for a reason. In the Social Security system, SSI is the abbreviation for Supplemental Security Income, a program that includes some people for benefits who would not otherwise be eligible based on contributions alone.

[KeithE]

[William Thornton]

Keith said: "The transfer of family farms from father to son/daughter after a father's death just serves to elongate the farm subsidies. And those sons and daughters need to be asked to make it on their own (without hand-me-down riches) just as much as in any profession. Equal opportunity demands that."

This is a good example of the 'good' Keith, data driven, budget conscious...our friendly graphologist and the 'bad' Keith - driven by what seems a visceral resentment of wealth and class privilege.

The first sentence can be persuasive.The farm subsidy system is an unholy, expensive mess, an entitlement. While the 'family' farm is a bit of a myth, perpetuating the system might be stopped by an inheritance policy that forced second or third generations to give up the land. I think there are more fair and easier routes to a better policy but Keith has a point worth making.

The second sentence is pure, arrogant, liberal nonsense expressing itself in unvarnished class warfare. Stick with graphology and step away from this steaming heap of moralistic paternalistic cow manure. You zero out your own kid's inheritance if you think that is best for them. Don't try to use gummit laws, guns, and force to make others follow your example.

[KeithE]

[Tim Bonney]

I've known a lot of farmers in my life Keith. Most of them are not being paid to not farm at all. That is an exception that should be fixed but it isn't what most farmers are involved in. Most of them love to grow crops and produce for their community.

As to farm subsidies, I do think there are industries that it is in the national interest to make sure it doesn't die and farming is one of them. Farming is part of our infrastructure as much as is roads, bridges, fire fighters, police, and healthcare. We can't afford to be beholden to other nations for our food. Nor should we set up circumstances where they only people who can afford to farm are big corporations.

I also do believe in property rights. One of the failures of US law is in this area IMHO. We have become a nation of transients where people are not encouraged put down roots in a community and stay there for generations. The generational aspect to small towns and family farms has been one of their strengths. It is what gives rootedness to the community and pride in growing a community.

When we charge people taxes for a family to keep its very own farm we are working against having cohesive communities, working against people being committed to their community, and working against the very nature of community itself.

[Dave Roberts]

Estate taxes are not a good means of taxation, IMHO. There should be high limits before they kick in that would automatically exclude small and moderate family plots. My community has lots of farmland around it, and most of it is leased to a few corporate farmers. There are very few of the owners who actually farm their land. Crops are being grown, but the bulk of it is in the hands of a small group of corporate size farmers. The land may be retained in family ownership, but many of those families do not live near the land or even in the same state.

[William Thornton]

It is evident that Timothy is one theological and social liberal who has met and recognized the reality on the ground and has adjusted his political views accordingly. I give him credit for such and give Keith credit for admitting he is a city guy and implying at least the possibility of some knowledge he may not have.

[KeithE]

[Tim Bonney]

[KeithE]

[Cathy]

There are more who can't keep the family farm because the siblings all want their share. Friends have had to sell because they lost the case. It was obvious to me that they would lose and I thought they were crazy to pay for lawyers. I sure enjoyed myself on that land.

I disagree with the idea that capital gains taxes should be higher for the similar reasons at least in estates. If the farm was bought many years ago is the value really more when comparing the price in todays dollars. So much of the gain may be inflation over many years. There is something wrong to me about taxing gain that isn't real gain. But that happens.

There are ways to preserve farms and reduce the chance that the land value will inflate to extremes. Most states have those and it comes with considerable tax savings on the land. There are certainly various trusts as well that I assume could be used. Land can be deeded in smaller portions to adult children overtime.

Farming is popular these days. Lots of people would love to own a farm. It is hard to rationalize giving farm families a break that you don't give everyone else. Lots of farms are sitting fallow with the old buildings crumbling. Should you give farm families a break in taxes to allow them the privilege of letting the farm go?

[Tim Bonney]

[Cathy]

[KeithE]

[Cathy]

It surprises me that there are a number of people that think farms need more protection than the usual land owner. If an estate is not taxed until one has inherited more than X million what is the problem. How large a farm should be protected from the usual estate taxes? Usually a farmer leaves several children behind. Estate taxes are generally figured on the individual inheriting. If a farm is worth several million the first few million are inheritance tax free. How many inherit determines the tax bill.

If the farmer's children decide to sell right after inheriting the estate was it fair to give them a break because it was a farm even if they have no intention of keeping the property. Family businesses have similar issues. Farms just aren't that unique. Farm land conservation programs, subsidies, state and federal grants for upgrades and farm infrastructure all to keep farmers in business and prevent the land from being lost to agriculture. Why worry about the estate issues. You don't need to have a multimillion dollar farm to make a living in farming.