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TAXES: The wealthy should be made to pay

Letter by Robert S. Cloud, Lakewood on Oct. 12, 2010 at 6:06 pm with 36 Comments »
October 13, 2010 12:02 pm

On Oct. 11, a front page article featured taxation as seen by two wealthy men. Why?

No one believes the United States or any state could exist without taxes. The economic distress we’re currently experiencing was not caused by too much taxation. Nine years ago there was a major reduction in taxes, benefiting mainly wealthy corporations, soon followed by a massive increase in governmental spending financed by massive borrowing.

Then came he collapse of the real estate and financial industries through poor business practices bordering on criminal activities. This led to a drop in the stock market threatening the profits of many businesses, causing them to fire large number of workers to protect their profits.

With fewer people able to buy, businesses had more losses leading to more layoffs, and the cycle continues to turn.

In spite of bailout money and the recovery of the stock market, those with the money are keeping it for themselves and not hiring. If those individuals and businesses with the financial means will not keep enough workers employed to maintain the economy, then the government must use taxation to support the economy or watch the end of democracy.

The tax must be on the wealthy in a form not easily passed on for others to pay.

Leave a comment Comments → 36
  1. The top 2% control 95% of America’s wealth.

    If taxes were proportionate then they should be paying 98% of the taxes yet they only have half of that burden – the rest of us are picking up their share.

  2. That should be “if taxes were proportionate they should be paying 95% of the taxes….”

  3. Well thought out, nicely constructed, and truthful letter, Robert.

    Corporations have been squirreling away money as they await a broken middle-class to begin spending so they can market products, hire and produce. Handing them additional tax breaks will only add to corporate stashes while increasing the budget deficit.

  4. BlaineCGarver says:

    Look at history, Commies. Capitalism will only produce when they believe the Gooberment won’t step in and either take over, or soak up profit in the form of higher, and higher taxes. Dump the ‘Crats this Nov and watch the market take off. Also, better Hope and Change for some leadership in 2012, or the whole country is going to be worse off than even now.

  5. The collapse of the realestate market was caused by greedy business people selling homes to greedy buyers who knew they couldn’t afford it,subsidised by greedy politicians who guarranteed the loans to get votes.

    The bankers should loose their jobs, the homebuyers should loose their homes and the politicians should loose their seats in congress. Unfortunately the only real loosers seem to be those of us who had nothing to do with it.

  6. MarksonofDarwin says:

    Yep. All those freedom loving liberals just LOVE to force others to live the way they want them to….and it doesn’t stop at corporations either.

    Those on the right are into coercive bondage as well, but they have different criteria for living the “good” life….

  7. aislander says:

    The comments in this thread make it obvious where the greed really lies…

  8. aislander could you explain

  9. BGC – you mean watch the economy take off like it did under Bush – straight down the toilet.

    Oldman4 – you’ve already lost your mine. Now consider the role that deregulation played in the economic meltdown.

  10. johnearl says:

    There are many fundamental economic misunderstandings in this letter, but the most stunning is this:

    “This led to a drop in the stock market threatening the profits of many businesses”

    A drop in stock price only affects a business’ profits if that business’ primary business is the holding of stocks. Those kinds of business are few and far between and they tend to have few employees.

    Most businesses make things (manufacturing), move things (distribution and transportation), or provide a service. Those businesses see a loss of business value when stock prices drop, but there is not usually a corresponding loss of profit.

    Stock price is a measurement of the value of a business. A business that is more profitable will generally see a rise in it’s value, but a drop in value would not necessarily trigger a drop in profits.

  11. patriot62 says:

    Well said Johnearl. This is the problem with all the hacks on here. They do not have a clue of what really goes on. These hacks also don’t have any retirement investments and that is why they pick on corporations. They want to live off other people instead of being responsible for themselves.

  12. p62 – your elitism is showing again. most workers used to have retirement plans thru their unions or their place of employment. as for retirement investments – ask any worker whose company retirement plan was turned over to wall street (you know – privatized) how well that has worked out for them.

  13. xring — yes, most workers did used to have retirement plans through their unions or place of employment. Their take-home pay was pretty much just enough to get by on, but they knew they’d have an income upon retirement, so it was a fair trade-off. You’d never be rich, but you’d always be able to put food on the table. Then, the workers decided they were sick of working for the “man” just to get by and they wanted to have a chance to better their lot. The workers decided they’d rather trade their pension for more take-home pay and invest the extra money themselves. The problem is they never got around to investing the extra money. They spent it. And they got used to it.

    So where is Joe Schmo’s retirement plan? I don’t know, but both his teenagers have brand new cars and he took his wife to Hawaii for their anniversary.

  14. pazzo242 says:

    “…then the government must use taxation to support the economy or watch the end of democracy”

    So tell me what do you think is already happening here under the direction of Comrade Obama. Keep this guy in office and democracy, as we know it.

    By the way—we have never had a democracy in this country. We have always been a republic with leanings toward some socialism. That is evidenced with such things as a variety of price controls, Social Security, government control of things such as police, fire, military and so on. Though we are not full blown communism the way Comrade Obama wants; we still have never been a democracy.

  15. pazzo242 says:

    then the government must use taxation to support the economy or watch the end of democracy”

    So tell me what do you think is already happening here under the direction of Comrade Obama. Keep this guy in office and democracy, as we know it IS OVER (sorry left that out of my first blog).

    By the way—we have never had a democracy in this country. We have always been a republic with leanings toward some socialism. That is evidenced with such things as a variety of price controls, Social Security, government control of things such as police, fire, military and so on. Though we are not full blown communism the way Comrade Obama wants; we still have never been a democracy.

  16. The workers decided they’d rather trade their pension for more take-home pay and invest the extra money themselves

    Really???!!!!???

    Any real world support for that claim?

  17. pazzo – double posting nonsense doesn’t make it any more rational.

  18. pazzo242 says:

    BB–just go have a beer–you don’t like my post don’t read it..I don’t really give a hoot what you think

  19. pazzo – it is possible to consider this thread a blog if one stretches the definition considerably. But to call a post a blog is clearly a misunderstanding of the term.

  20. iamjimbo says:

    Beerboy, unlikely that making backhanded snarky remarks makes one appear wise.

  21. aislander says:

    Who, OL, is expressing a desire to take what someone else owns? THAT is greed…

    How can it be justified morally to act on the basis of that greed?

  22. X- Just where do you imagine that unions (I am a Teamster) or corporations
    (employed by a huuuuge global enterprise) come up with their pensions for retirees? Just askin’.
    Here’s the “Clue-of-the-Day” for both Bb and Xring : ahem…the corporations AND unions do actually invest in
    a) other corporations
    b) insurance and re-insurance facilities
    c) banking and derivative instruments
    d) Government bonds both foreign and domestic
    e) trans-national financial groupings like the EuroPacific Fund or the AsiaPacific
    So who was in charge of Fannie-Freddie for the last decade or two, hmm?

  23. Roniew – nice try – lets blame the victims for their own misfortune. The truth is that workers did not have a choice. The employers converted the company retirement system to IRA.s based on investments (as in Wall Street) and managed by the company or farmed out to a special management service. End result – the company paid less, the workers paid more, and when Wall Street crashed so did the IRA’s.

    If Joe’s kids have new cars and he can afford Hawaii, chances are he is a Manager or Executive, not a worker – epically a retired one.

    Islander – I don’t see a comment from old left, but the term you see to looking for is foreclosure.

  24. xring — workers DO have a choice. Just about every company has a 401k plan employees can contribute part of their pay to. My job allows me to see many people’s assets and I can tell you that very few people contribute 15% of their pay year in and year out. The market falling has certainly affected many people’s IRA and 401k balances, but those accounts were woefully underfunded to start with.
    At the same time, the standard of living has gone WAY up in the years since companies moved away from pensions toward 401k plans. Houses are bigger, families don’t share cars, people have cell phones for personal use, not business. Clearly people are spending more than they need to on food since obesity is on the rise. Houses have multiple TVs. I notice little things like people keep their houses warmer than they used to and lots of people have an energy-sucking fridge in the garage for soda pop. When I was a teen we didn’t have the gas money to drive around more than we needed to.

    Most people could save more if they wanted to.

  25. clue of the day larsman – none of those speculative activities are directly related to actually manufacturing a product.

  26. Ronview – you make a good point but let’s not forgot that most families have to have two wage earners to keep up the lifestyle.

    Larsman are you saying that all the other investments are still sound and the only fred and fanny caused our economic problems? Don’t know how things are where you work, but where I work most of the people who are in the retirement zone can’t because their accounts went down the tube.

  27. aislander says:

    You think foreclosures happen, xring, because the banks WANT those properties on which they have lent more than current market value? You really DON’T know anything about business OR economics. That’s why you’re a lefty, I guess…

  28. FreeAmerica says:

    beerBoy says:
    October 13, 2010 at 12:28 pm
    The top 2% control 95% of America’s wealth.

    Wrong… have to call you out on this BBoy… http://sociology.ucsc.edu/whorulesamerica/power/wealth.html

    This a common talking point for the left that is misleading

  29. Just more liberal talking points and class envy.

  30. Bb- my post was in response to Xring- Yes Unions and corporations have been investing in said stock combinations at least as far back as 1992. Subsequent investments as in 401’s and Roth/IRA’s have been given more lateral choice to the individual to channel their preferred percentages with the advantage of company matching funds.
    X- the reference to Fan-Fred is that their respective annual reporting mechanisms were both financially and politically flawed which did create the so-called housing bubble (I was in manufacturing during the last decade) based on the lack of effective, regular and independent oversight. See oldman’s post for brevity. We effectively got a “house built on sand” and were given earplugs, blinders and told to engage “bigger-better-faster-more” , don’t ask questions and never mind the man behind the curtain…..Mr. Frank…Mr. Dodd…Mr. Paulsen….Mr.Gaithner, as our 600 employee plant downsized from 24/hour- 4/12hr shifts into 8hr / 5day shifts and further into 4 / 10’s and then closing some departments and the layoffs. Management and owners are WAITING for congress to make up their selfish, indecisive little minds so the rest of the country (private enterprise) can actually PLAN. If there are still “minimum wage” ostriches out there remember: when you artificially adjust wages and raise taxes and a flood of paperwork regulations, employment WILL skyrocket….in China, India and Mexico (Government Motors is building a $5000,000.00 plant in Mexico, where the Chevy HHR is exclusively manufactured, by the way. Why do we still seek the 2009 Greek model?

  31. It’s 10:00……Do you know where your …derivative …is?

  32. Islander – if the banks did not want the homes why are they so hot to forclouse?

    Lars – didn’t know F&F controlled so much of the housing market?

  33. X- F & F have been the default loan guarantee mechanism for FHA / VA , conventional and anything left besides owner contract. They eventually benefited from the “Community Re-investment Act of 1977″ which opened the door for A. R. M.’s and under later senatorial supervision of Barney Frank D-MA and Christopher Dodd D-CT continued the expansion and indirect encouragement of falsely leveraged instruments labeled “Derivatives”.
    The Consumer Price Index is primarily based on new housing starts.
    When the index is high, those in power look good….until the artificial bubble bursts. It was a 34 year-long development. Being in manufacturing, we got hit early. A lot of my friends and co-workers would like to reconnect our skills to manufacturing…..but there must first be an honest private enterprise market, not a temporary tax-subsidized artificial one…

  34. aislander says:

    It’s the only way they can recoup SOME of the money they lent. What do expect them to do, allow people to live in the houses rent-free? What suckers those who MADE their payments would be. Then those people would stop paying and so on and so on…

  35. Lars – sounds like F&F have worse cpa’s that the Pentigon.

    Roncella – they could try refinancing the loans. Oh,wait, the Republicans in the Senate blocked that bill.

  36. Oh by the way Roncella, why do you think the home owners suddenly couldn’t make their house payments? Could it have been because somebody was shipping American jobs overseas?

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