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bigblock46 73M
10930 posts
3/13/2019 3:50 pm
Alexandria Ocasio-Cortez pushes tax myths that will bring economic disaster

Do you pay enough taxes? What is enough?

When asked on “60 Minutes,” Rep. Alexandria Ocasio-Cortez didn’t seem to have a specific tax rate in mind, but then she said, “back in the ’60s ... you see tax rates as high as 60 or 70 percent.”

Suddenly, 70 percent tax rates are a progressive plan, although Rep. Ilhan Omar added, “We’ve had it as high as 90 percent.”

She’s right.

That was the top tax rate when I was a kid, and today, many Democrats say if we’d just raise rates on rich people, government would have plenty of money to pay for our wonderful programs.

But it’s a myth. What progressives don’t say, perhaps because they don’t know it, is what economic historian Dr. Phillip Magness explains in my new video: “No one actually paid anywhere close to those rates.”

For more than a decade, Magness has researched old taxes.

He discovered that America’s 90 percent tax bracket didn’t bring in much extra money. That’s because rich people found loopholes.

Then, because of that, and because the high tax rates discouraged work, President Kennedy backed a bill that lowered the top rate to 70 percent.

But it turned out that the 70 percent rate wasn’t very real either.

“A millionaire on average would pay 41 percent,” says Magness, because of “all these deductions and exemptions and carve-outs that are intentionally baked into the tax code.”

If you look at newspapers of that time, you see ads promoting things like free $2,499 ocean cruises.

"Basically take a vacation around the Caribbean,” explains Magness, “but while you’re onboard the ship you attend, say, an investing seminar or a real estate seminar, and then write off the trip.”

Some rich people bought musical instruments for their kids and deducted the cost because, say, a clarinet would supposedly provide “therapeutic treatment.”

Instead of investing in ideas that might create real wealth, rich people hired accountants to study the tax code.

“Who can afford the best accountants? It’s always the wealthy,” says Magness.

Today, our top tax rate is 37 percent. A dozen years after President Kennedy’s tax cuts, Ronald Reagan proposed reducing the 70 percent rate, saying, “Our tax system could only be described as un-American.”

“Democrats actually agree with him,” recounts Magness. “Reagan goes to the table and says, ‘Let’s make a deal ... cut the rates ... and in exchange, we’ll consolidate the tax code.”

They did.

Surprise -- the lower rates brought in just as much money.

It turns out that tax revenue as a percentage of gross domestic product stays about the same no matter what the top bracket is. Higher tax rates don’t necessarily get rich people to pay more taxes.

“They’ll change where they earn their income,” economist Art Laffer told me about what he’d once said to President Reagan. “They’ll change how they earn their income. They’ll change how much they earn, when they receive the income. They’ll change all of those things to minimize taxes.”

President Trump, who in some years paid zero income tax, understands that. Before he became president, I asked him about a proposed tax hike. “Look, the rich people are going to leave -- and other people are going to leave!” he told me. “You are going to end up with lots of people that don’t produce. And then, that’s the spiral. That’s the end.”

That happened in Europe, recounts Magness: “France attempted a massive tax on its wealthiest earners. ... the business people left in a mass exodus from the country.”

But today’s progressives are selective when they look at history. On TV, Ocasio-Cortez said, “Under a Republican administration ... Dwight Eisenhower, we had 90 percent marginal tax rate.”

I asked Magness what would happen if the U.S. were to return to those rates -- while also eliminating the deductions that came with them.

“You’re asking for an economic disaster,” he answered. “I ask the question: Do we leave (wealth) in the private sector where the market decides? Or do we subject it to corrupt politicians?”

Please, let’s leave most of America’s wealth in private hands.

by John Stossel

bigblock46 73M
8942 posts
3/13/2019 3:50 pm

MrsJoe 71F
10633 posts
3/13/2019 8:36 pm

IF I were among the very rich, and they made the income tax that high without the loop holes, I would retire and live on my accumulated wealth. I would not attempt to build any business to create more income for myself, which would also mean any employees that I might have would be out of work. Why cant AOC and others see that?

Spring is here, it's beautiful outside. But let's sit on the computer and insult each other!

sparkleflit 71F
4291 posts
3/14/2019 6:23 pm

    Quoting  :

Then in place of knowledge they cut and paste as if they know what is going on.


bigblock46 73M
8942 posts
3/14/2019 7:17 pm

    Quoting sparkleflit:
    Then in place of knowledge they cut and paste as if they know what is going on.

See there you are going off the deep end, I ask can either one of you dispute what the person said.

Today’s Democrats might find it surprising that JFK was a supply-sider. In a speech to Congress in January 1963, he said the high tax burden was an “unrealistically heavy drag…on private purchasing power, initiative, and incentive.” He knew the best way for the government to raise growth was to get it out of the way and let the private sector do what it does best.

But the Revenue Act of 1964 did everything he anticipated. According to economic historian Brian Domitrovic, JFK’s economic policies brought unemployment below four percent, created 13 million jobs and economic growth of 48 percent over eight years. The economy had been sluggish in the 1950s, but Kennedy made certain it was bustling in the 1960s.

bigblock46 73M
8942 posts
3/15/2019 6:29 am

Yes I know what supply side means, but the real question is , DO YOU?

bigblock46 73M
8942 posts
3/15/2019 3:18 pm

    Quoting  :

Of note, in the 21 months since his inauguration, President Trump's deregulatory policies and historic tax cuts have led to a manufacturing resurgence, with 396,000 jobs added. In fact, the pace of manufacturing job growth over the past 21 months of President Trump's leadership is more than 10 times that of President Obama's last 21 months in office.
Manufacturing Boom

A significant part of America's manufacturing boom may also be attributable to a key change in the tax code signed into law in December 2017. The new law encouraged U.S. companies with corporate earnings sitting overseas avoiding high U.S. corporate taxes to bring that cash back to American shores. Some $300 billion out of what the Federal Reserve estimated is $1 trillion in multinational enterprises' profit was sent home in the first quarter of 2018.

On October 5, 2018, the Department of Labor released its national jobs report for September, showing unemployment had hit a 49-year-low at 3.7% with 134,000 jobs added last month of which 18,000 were in manufacturing.

Now I have told you already that first off I know nothing of what you are asking. If you think you are being ripped off just remember your DOJ for Texas.

Under the law, it is illegal to:

knowingly make a false or misleading statement about the need for parts, replacement or repair service;
state that work has been done or parts were replaced when that is not true;
represent that goods are original or new, when in fact they are second-hand or refurbished; and
advertise goods or services with intent not to sell them as advertised.