Taxing the rich is the budget's sticking point
You would think that with all that is at stake here, Republicans could bend on this one issue.
Do the Republicans have the ability to make a stand only on keeping down the taxes for all who make more than $250,000? Is that a viable position? Is that what this fiscal cliff is coming down to?
If you parsed the rhetoric you would think so. There doesn't seem to be any real gulf with the huge compromises that have to be made about the defense budget, the Social Security tax break, the alternative minimum tax, the extended unemployment benefits and even the defense budget. There's no distance between the two sides on holding taxes down for those who make less than $250,000. It just seems like the Republicans are willing to go to their grave defending the right of the wealthiest not to pay higher taxes -- something that is a deal-breaker for President Obama, as reiterated by his minion Nancy Pelosi (D-CA) on the talk shows this weekend.
You would think that, with all that is at stake here, this measure could be agreed upon. I mean, the rest of the cliff jump is far more important to the U.S. economy to have it be sacrificed on a no-tax-increase policy, no matter what position. That's particularly so after that position -- which was well-known to the electorate -- held no water in the latest election. The Republican candidate was only able to pick up a few states over the other one, despite the economy being structurally unable to produce enough jobs not to mention worry about going back into recession.
Yet, when you go through the documents for this issue, as I do for my Wall of Shame nominations, it is by far the most important sticking point.
I think that's one of the reasons there is so much hope a deal could be done. Logically, this one cohort, which could bring in $40 billion -- the smallest portion of the amount of money that would be raised by the tax increases that are coming -- couldn't and shouldn't be able to trigger a U.S. recession via fiscal cliff. Logically, at least a phase-in could be agreed to, and the Republicans aren't going to have to give up much, given that they are the minority party. You would think that at least this gives them a terrific position to run on in 2014, if they think it is terrific: We kept taxes down even for the richest. If they think they can turn the tide in the blue states with that, and if the Tea Party thinks it can stay alive claiming that it kept rates down, then the U.S. will go over the cliff, plain and simple.
- On Tuesday, November 20 at 6pm ET, TheStreet will host a Trade Credit Insurance webinar with Todd Lynady, Senior Underwriter for Zurich in North America and Mike DeLuca, Senior Partner of One Source. Register now.
So, that's the sticking point to watch. It's not the defense budget, or the employment, benefits, or the social security exemption, or the taxes for the middle class or the aversion of the Alternative Minimum Tax for millions.
It's all about taxing the rich, and their capital gains and their dividend income and pleasing or displeasing the wealthiest people in the country.
Jim Cramer is a co-founder of TheStreet and contributes daily market commentary to the financial news network's sites. Follow his trades for Action Alerts PLUS, which Cramer co-manages as a charitable trust.
More from TheStreet.com
Now, not only the rich, but those that have suffered severely (been fleeced) at their hands are brainwashed into thinking Big Money is the savior to all our woes; if the tax cuts Were the solution, then why are so many regular folks still headed to the poor house? Do a little homework people...
Mirrage Guy Said
And it doesn't matter their income. They SHOULD pay something. WE need to stop giving these leeches a free ride. The middle class is tired of supporting their lazy asses.
Numbers matter Mirrage
Mirrage the average family of 4 in the bottom 50% of Americans makes about $24,000 a year. We all know about the cost of living, the rising food and gas prices. Imagine trying to provide some type of life for a family on that, what the hell are you going to take from them, 30 bucks. It would cost more to pay the IRS to process it then the income it would bring in.
The 1% is out of touch, period.
- Bernie Sanders, November 19, 2012
So you stand in favor of "Fair" treatment, instead of EQUAL treatment under the law?
Mirage GUY:You really hate this country don`t you?Just because you fell hook,line and
sinker for a corporate raider like Romney you can`t put the election to rest.Years ago
when me and hubby were teens we worked our butts off for minimum wage and yes,
we still paid taxes, we didn`t forget our roots.Now we have 6 figure wages,we still
love this country and respect people making less.Usually, they work harder than most.
The Issue at hand is simply.....Takebacks on "tax give-aways" and "spending cuts.."
And "elimination of fraud and wasteful spending."
Real "no-brainer stuff"...Doesn't take 3 pages or 5,000 pages of rhetoric...To discuss it...
Takes a couple lines....And a "we can do-it attitude."
GOMO.....Pretty sure that the results for Hurricane Sandy's effect on Home Depot and Lowes' bottomline......Will SHOW UP in their 4th. quarter's filings ??
Time to get a little more investment money into Home Improvement Stocks...Kapish..??
Probably even Cramer would agree to that...?
Home Improvent has been one of the better investments, over the last couple years..or so.
And is one group we have done very well with....HD alone, has more then DOUBLED and pays about a 2.5% dividend...
I attribute that to the Housing sector improving, along with the Recovery progressing, AND finally Babyboomers Retiring and Remodling their abodes....Cramer might agree with that also ??
I'm not opposed to paying a little...More or less on Divs or Cap Gains...Even being Retired I can control some of that...
So I can only imagine what the Rich and/or Elite can get away with, using a Battery of Accountants and Tax Lawyers..
Somewhat upsetting is what others have alluded to...Is basically the Middle Class supporting these goddamn tax evaders and rich beyond your wildest dreams group, the 1-5% percenters..
The Middle Class and the Working poor suffered the most in this downturn..
The Well to do, recovered(most) and have prospered once again...
Anyone who says different is a goddamn liar...
The Tax Reform Act of 1986 was authored by Republicans. Previously, businesses and individuals making excessive windfalls paid up to 93% tax on them. The average consumer could write off lots of things, businesses could not. The Act initiated hyper-appreciation in housing and is undeniably the starting point for our current housing woes. 1986 marked the last year corporate America paid fair taxes.
It is widely accepted that with the Tax Reform Act came the infusion of hired-in CEO positions and elimination of Founders. According to a study by Carola Frydman of MIT, from 1936 to the early 2000s there has been a rapid increase in the share of MBA graduates acting as CEOs; from approximately 10% of CEOs in 1960 to more than 50% by the end of the century. Earlier in the century, top executives were more likely to have obtained technical degrees in science and engineering or law degrees. Notably, the MBA circumnavigates any actual business exposure but does require complete financial manipulation abilities. Ergo... ban the MBA and mandate a CEO to have actual self-employment experience in substance (no financial, paper or buttons) and we likely restore balance in business.
You're glossing over the fact that the 47% pay sales, state, and local taxes. There are also a lot of millionaires who pay $0 in Federal taxes. Demonizing the $250K+ earners is just as myopic as bashing "the 47%" . Also, MirageGuy, $250K+ earners are most certainly not "middle class". What really needs done is the tax system should be completely overhauled because it his highly flawed.
Hey you stole my next post!!!!!!!!
Agree x 1000
VL.. I fail to see the problem. In many industries government is embraced by the MBAs running the show because they put up barriers to additional competition. Every new air quality regulation that current players have make it more expensive to get in the market and establishes a standard to meet instead of continuing to invest unnecessarily. The regs give the ability for a business to say "We followed the rules" as a shield for civil liability.
Why do you think business exists except to maximize profits?
Finally.. if there are ways to avoid taxes and minimize your tax bill.. why wouldn't you? At the end of the year it's time to look at the losers and decide what, if any, losses to take to offset gains. In February, I can buy the same ones without suffering a wash sale issue. I can opt to put my own money into a 401K instead of take it in cash and put it in mutual funds on my own. I'll vote for rule changes as I think they make sense, but you play by the rules of the game with the established rules, not ones you wish were there.
We must also take a hard look at wasteful spending in the Defense Department, where we now spend almost as much money as the rest of the world combined. Significant savings can be found at other federal agencies, too."
- Bernie Sanders, November 19, 2012
Sounds like a recipe for loser stew.
Pretty much a confession for abolishing the degree and dashing those who used it to gain a pariah role.
MORE ON MSN MONEY
Copyright © 2013 Microsoft. All rights reserved.
John Stumpf acknowledges that growth has been slow, but he says he's still optimistic.
VIDEO ON MSN MONEY
Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.
Contributors include professional investors and journalists affiliated with MSN Money.
Follow us on Twitter @topstocksmsn.