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Subject: United State Tax policy & negative balance of foreign trade
RedParadize 7/20/2011 12:05:15 PM

Hi everyone, As a canadian, I follow the debt ceiling debate with a deep interest. It is a hot topic and I realize that it may upset some. I would ask everyone to keep it as cool as possible. Left vs Right direct attack should be avoided, lets focus on policy themself. Lets start While I understand and agree that low tax is generaly a good thing for the economy, mainly by alowing consumer to buy more. The problem I see is that since United States have a negative foreign trade balance, the cash will inevitably bleed out the country and I don't see how it will come back. To fix this issue, Should not the trade balance be adressed first? Or go back to protectionism maybe? Or, Would it not be better to keep tax at its current level, if not raising it a bit more and preserve/increase gov jobs?

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YelliChink 7/20/2011 2:56:26 PM

Hi everyone,

As a red diaper doper baby not living in the US and not paying US tax, I am so nosying enough to follow the debt ceiling debate with a deep contempt.

Funny. This is how my Canadian to English translator shows to me.

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RedParadize 7/20/2011 3:29:50 PM

Believe it or not, I am sincere. I am concern by this issue and I do respect the US and its citizen. Not only because it will affect Canadian economy, but most of my client, colleague, and allot of my friend work in the US.

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Reactive 7/20/2011 6:59:04 PM

Don't worry about Yellichink, he pretends to be a patriotic conservative american when he is in fact just an exchange student living in liberal chicago.

Addressing the skyrocketing debt requires cuts (undoubtably) and, I would argue, whatever returns growth the quickest, ironically raising taxation for the rich doesn't necessarily work as it would do in theory, the rich are the best able to hire accountants to minimise their liabilities, they are also the most likely to relocate either themselves or their companies elsewhere if needed, given that "the wealthy" basically includes the vast majority of employers in the US I think any tax rise has to be treated with exceptional caution.

The truth of the matter is that the single most easily (in terms of immediate repercussions) reducible expenditure is that of the military, this is why (and I don't advocate this) I expect that to be the next major area of spending cuts, and I expect it to happen the moment there is a pull out in Afghanistan - that is because there will be a somewhat reduced outcry when US forces are not involved in major combat operations.

You can't tax your way out of a recession, you need to promote business, investment and growth, in a global marketplace this is what gives your economy the edge, and is why I would be very hesitant to increase either spending or tax unless every other course of action has failed.

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phrank 7/20/2011 7:42:58 PM

Right now the way we tax people is all messed up. To many pay no taxes and worse some get back more than they pay in. The reason that is a problem is because if you don't pay anything or get more back why would you care what they spend money on. What we need is a way for everyone to pay taxes. What I would like to see is the minimum wage rate raised to $10.00 a hour and then a flat tax rate of 15% on everyone. No filing, no tax returns you just give the government 15% and your done. That way everyone has a stake in what they spend money on. I would also like to see the military get a % of GDP fixed except in time of declared war. The government here has become for to many a giant ATM. I want the people in congress to base their pay on % GDP that way when the country hits hard time so will they. If not that then I want everyone to be able to vote for their own pay raises.

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earlm 7/21/2011 1:01:06 AM

If you work they tax you. If you pay employees they tax you. If you save money and invest it at interest or have your capital appreciate they tax you. If you go into debt to buy a house you can write the interest off as a deduction. The incentives are all wrong. There's a proposal for a federal sales tax that would be adjusted for low income people. It's called the Fair tax but the left hates it because it takes away the social engineering aspects of tax policy.

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Reactive 7/21/2011 2:29:02 AM

I'm massively in favour of a flat-rate of tax, anything under 20 percent will then dictate your national spending policy, then actually spend that revenue in being ruthless on tax evasion, you're still the most competitive in the west, you become a massive beacon for investment but enforce that low rate as if it was a capital offense to defy it - that is the way forward. The truth is that what governments fail to see is that just as they accuse corporations of "rigging" the system (price fixing) so have they on a number of different national policies, most especially taxation, how about countries realise the untapped potential of a relatively low-tax western economy, and realise that the net revenue collected will in a matter of years, far surpass that of rival economies.

Yes I am for certain national spending programmes in my country, healthcare, education and military, with a strong economy without need of government-subsidised jobs and a vast public sector spend we can achieve this, unfortunately no one has the balls.

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Nanheyangrouchuan 7/21/2011 11:48:36 AM

Tax breaks for the rich do not exist in a broad form for all people making over or under a certain amount, they generally exist in the form of loopholes such as corporate jet breaks, classifying private rural property as agricultural production, all of your sports cars as company cars, etc.

These loopholes need to end, all of them. And manipulating these loopholes is what the private wealth industry specializes in, so that the reduced or no tax you pay on these specific items can be turned into a tax refund. Yes, a tax refund for flying on a private jet. Often a company jet that executives use to shuttle their families around. Of course in the US, you'd think that shareholders would have a say in this, but they don't.

And, as most of the posters here either don't know or pretend not to know, even with all of those tax breaks, the rich still send invest money offshore into places where blood diamonds are guarded by 12 year olds with AK's, where sex slavery is common and legal and where sweatshops are known as "progress". Can't do those things here so the rich invest where these original forms of capitalism and industrialism can flourish.

Oh, and we need to save tax dollars for more bank bailouts.

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phrank 7/21/2011 11:57:45 PM

That's why we need a flat tax, although a sale tax would be fine also. One rate period. They will never do that because both sides give loopholes. That's where they get their money to run from. I think some of them really think that the money is theirs and they allow us to keep some and we should shut up and be grateful. I am sick of them not having to live on a budget. They always say we will do this and then a few years down the road we will fix it, WELL GUYS WE ARE DOWN THE ROAD AND THERE'S A SHARP TURN AHEAD. I fear for us I really do.

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YelliChink 7/22/2011 12:04:33 PM

http://www.nationaljournal.com/whitehouse/obama-cut-defense-spending-before-food-stamps-20110721

Obama: Cut Defense Spending Before Food Stamps

President Obama has taken some heat from Democrats--and particularly progressive Democrats--for his willingness to alter entitlement programs to reduce the deficit. But in an interview with NPR airing on Thursday and Friday, the president sought to reassure his base of his commitment to his party’s ideals.

“I think what's absolutely true is that core commitments that we make to the most vulnerable have to be maintained,” Obama said. “A lot of the spending cuts that we're making should be around areas like defense spending as opposed to food stamps.”

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YelliChink 7/22/2011 12:57:00 PM

http://www.investors.com/NewsAndAnalysis/Article.aspx?id=578920&src=HPLNews

Home Depot Co-Founder: Obama Is Choking Recovery

By JOHN MERLINE, INVESTOR'S BUSINESS DAILY Posted 07/20/2011 06:35 PM

IBD: Why don't more businesses speak out?

Marcus: They are frightened to death — frightened that they will have the IRS or SEC on them. In my 50 years in business, I have never seen executives of major companies who were more intimidated by an administration.

IBD: What's your message to the business community?

Marcus: It's time to stand up and fight. These people in Washington are out there making your life difficult, and many of you won't survive. Why aren't you doing something about it? The free enterprise system made this country what it is today, and we've got to keep it alive. We are on the edge of the abyss.

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