A Q for the Wealth Creators
- Thread starter AZDuck
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PurpleJ
New Fish
1. Cutting tax rates only results in increased tax revenue if you're on the right side of the curve. I'm pretty sure we aren't on the right side of the curve.
2. The ideal result of taxation isn't to maximize tax revenue, but to maximize economic growth. All the Laffer Curve illustrates is the point where taxable revenue is maximized. Maximum levels of growth occur on the left side of the curve, with rates below that of the revenue maximizing point.
3. Even if that survey was valid, it wouldn't prove shit. Those are opinions.
2. The ideal result of taxation isn't to maximize tax revenue, but to maximize economic growth. All the Laffer Curve illustrates is the point where taxable revenue is maximized. Maximum levels of growth occur on the left side of the curve, with rates below that of the revenue maximizing point.
3. Even if that survey was valid, it wouldn't prove shit. Those are opinions.
topdawgnc
New Fish
The ultimate question: Who can spend money more efficiently. The government or the private sector. I believe in the private sector. However, it can't just be about taxes.
Here in Texas we have low taxes, however, we also have other factors that create a "surround sound" of savings. Tort laws are very much in favor of the business community, property is abundant and there is not a lot of regulation to prevent growth. Unions are kept in check, which allows for a business dollar to go farther.
We also have a large population, which helps. And we have a great family draw. Cities are clean, vibrant, and our education system is strong.
Let's face facts. People aren't anxious to move to Topeka, Kansas. And if they move to Kansas City, there is a good chance they end up in Missouri.
I am also amused we are assuming Kansas' success/failure after only one year.
If we use that measuring stick Reagan would never had seen a second term ...
Here in Texas we have low taxes, however, we also have other factors that create a "surround sound" of savings. Tort laws are very much in favor of the business community, property is abundant and there is not a lot of regulation to prevent growth. Unions are kept in check, which allows for a business dollar to go farther.
We also have a large population, which helps. And we have a great family draw. Cities are clean, vibrant, and our education system is strong.
Let's face facts. People aren't anxious to move to Topeka, Kansas. And if they move to Kansas City, there is a good chance they end up in Missouri.
I am also amused we are assuming Kansas' success/failure after only one year.
If we use that measuring stick Reagan would never had seen a second term ...
MikeDamone
Active poster
I haven't analyzed Kansas in any detail. I'm not sure the state of their economy before this occurred. When did they tax affect? Was it at the start of 2013? So 18 month?
There are many reasons economies do well and why others do not. Tax policy is one of the reasons. It's easy to cherry picking events as examples. There are a few examples high-tax states that do better than average, and low tax state that don't do as well. The devil is in the details.
But there is an irrefutable correlation between economic freedom and wealth creation. The data over decades shows an unmistakable pattern that low taxes, light regulation, and property rights, and freedom to trade, have become magnets for people and businesses and jobs.
We know that states that on average sates without an income tax have had double the population growth and more than double the income growth of states with very high income taxes over the last 10 years.
We know that Texas (with no income tax) gained 1 million jobs over the last five years, California (high income tax), lost jobs. Florida gained jobs, New York lost jobs. Illinois raised taxes and according to Moody's has a lower credit rating than Kansas.
To come out 18 months after the tax cuts went into affect and pick Kansas as the example that proves less government intrusion doesn't create growth is intellectually dishonest and certainly political.
I'm sure you'll attack the source or these references rather than understand them, but that's your choice:
rationalmind.net/2002/12/10/the-relationship-between-economic-freedom-and-prosperity-around-the-world/
freetheworld.com/2012/EFW2012-exsum.pdf
freetheworld.com/2012/EFW2012-complete.pdf
filipspagnoli.wordpress.com/2008/06/20/human-rights-quote-67-economic-freedom/
heritage.org/index/
freetheworld.com/efna/3EFNAch3.pdf
There are many reasons economies do well and why others do not. Tax policy is one of the reasons. It's easy to cherry picking events as examples. There are a few examples high-tax states that do better than average, and low tax state that don't do as well. The devil is in the details.
But there is an irrefutable correlation between economic freedom and wealth creation. The data over decades shows an unmistakable pattern that low taxes, light regulation, and property rights, and freedom to trade, have become magnets for people and businesses and jobs.
We know that states that on average sates without an income tax have had double the population growth and more than double the income growth of states with very high income taxes over the last 10 years.
We know that Texas (with no income tax) gained 1 million jobs over the last five years, California (high income tax), lost jobs. Florida gained jobs, New York lost jobs. Illinois raised taxes and according to Moody's has a lower credit rating than Kansas.
To come out 18 months after the tax cuts went into affect and pick Kansas as the example that proves less government intrusion doesn't create growth is intellectually dishonest and certainly political.
I'm sure you'll attack the source or these references rather than understand them, but that's your choice:
rationalmind.net/2002/12/10/the-relationship-between-economic-freedom-and-prosperity-around-the-world/
freetheworld.com/2012/EFW2012-exsum.pdf
freetheworld.com/2012/EFW2012-complete.pdf
filipspagnoli.wordpress.com/2008/06/20/human-rights-quote-67-economic-freedom/
heritage.org/index/
freetheworld.com/efna/3EFNAch3.pdf
AZDuck
New Fish
http://blogs.ajc.com/jay-bookman-blog/2010/09/14/the-laffer-curve-debunked-part-one/
Purp - the thing is that as a matter of policy, nobody seems to want to discuss the utility of the curve. Since a bunch of trained economists don't think that it can be used to guide policy, the Laffer Curve probably shouldn't be used to formulate policy.
[T]he problem is, something very destructive happened in the translation of this economic theory into political language and policy. In the popular conservative version of the Laffer Curve, no debate over the location of Point A is even tolerated, because cutting tax rates is said to ALWAYS generate more government revenue.
In effect, Region B, the part of the curve in which lower tax rates produce sharply lower government revenue, has simply been banished from the discussion.
Once you do that, however, the Laffer Curve no longer functions as a curve at all (see Figure Three). If lower rates always produce more revenue, as the right likes to claim, the Laffer Curve becomes the Laffer Line, and Point A, the sweetspot, stands at a tax rate of zero.
While that makes no sense mathematically, politically it is an enormously appealing notion. It’s like telling someone with an obesity problem that the best way to lose weight is to always eat more ice cream — more times than not, their eagerness to believe overwhelms any skepticism.
Purp - the thing is that as a matter of policy, nobody seems to want to discuss the utility of the curve. Since a bunch of trained economists don't think that it can be used to guide policy, the Laffer Curve probably shouldn't be used to formulate policy.
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AZDuck
New Fish
I left Maryland and moved to Virginia after I retired for a number of reasons, but chief among those was taxes. Single example I know, but I cannot think that I am alone in searching out states that give me more economic freedom. I was willing to move everything I own for it. Who wants to pay a tax for the economic impact of their roofwater runoff? Yes, that's correct, MD taxes the rain that hits your roof. Fuck Maryland.
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MikeDamone
Active poster
Where is the U.S. currently on the Laffer curve? Does anyone know? The laffer curve also demonstrates that at a point, tax cuts will result in less revenue. It doesn't say cutting all taxes to zero will generate more revenue. It simply states there is a level that at which raising or cutting taxes will generate the most revenue. Would a 100% tax rate increase revenue? The whole thing is too simplistic, but if your going to "disprove" it, at least acknowledge what it is trying to communicate.
AZDuck
New Fish
Swaye - that's fine. Nobody likes paying taxes. And your circumstances as a retiree are significant because you lost untaxed income in the form of BAH and BAS and are on a limited (and fixed) income as a retiree. States like Florida, Arizona and, I guess, Virginia have made a decision to capture retirees.
And it worked, in my case at least.
Link to rain tax:
http://www.forbes.com/sites/travisbrown/2014/01/03/when-it-rains-it-pours-tax-dollars-in-maryland/
I was already looking for a way out, but this last tax just took the cake for me. Property taxes going up every year, income tax at 10% (just State), abortiative taxes on gas....just on and on...Maryland is a very typical blue state....tax and spend. Oh yeah, and the recent gun laws enacted by O'Malley were attrocious, but that is for another thread I suppose...
I have no idea how Maryland is doing economically relative to other blue states (I'd guess better because of their unique proximity to the largest employer in the world - DC, but that's just a guess) but I have read several articles about how high wage earners are abandoning MD for VA.
http://www.washingtontimes.com/news/2012/jul/3/marylanders-move-in-droves-to-virginia/?page=all
I know this thread isn't about MD or VA, but I love taking shots at O'Malley and pointing out one example where a person left mostly due to tax issues - and that person was me. Fuck Maryland.
topdawgnc
New Fish
I read the California job article and here is what jumped out to me:
Employment numbers in the Inland Empire and Los Angeles are still below the pre-recession peak, while San Francisco, Silicon Valley and San Diego have regained the job losses in the wake of the foreclosure crisis.
If I have a population of 1,000,000 people. And the rest of the country has 500,000.
And I lose 500,000 jobs. And the rest of the country losses 50,000.
Would I not rebound at a faster job growth rate?
At some point you bottom out ... and you begin to add jobs. And if you have a larger population, and a larger group of unemployed ... you will add jobs at a faster rate.
Regarding Texas.
Yes. Fracking and oil has helped us.
The fact is Governor Perry has been prudent about using that growth to draw in other companies and not blow through the money like Swaye at a coke driven tattooed hooker festival.
It's like saying Clinton was only lucky because of the dot.com boom.
It is how he utilized his resources and built regulation around it.
The company I work for, in Texas, is adding 94 people this fiscal quarter. We employ 1500 currently. We do very little in oil and gas. However, the divisions that are vested in this sector are creating wealth, which is helping lift all boats. On the flip side our soccer loving CEO is cutting the divisions who are hurting.
The problem with government is no one ever cuts.
I read the California job article and here is what jumped out to me:
Employment numbers in the Inland Empire and Los Angeles are still below the pre-recession peak, while San Francisco, Silicon Valley and San Diego have regained the job losses in the wake of the foreclosure crisis.
If I have a population of 1,000,000 people. And the rest of the country has 500,000.
And I lose 500,000 jobs. And the rest of the country losses 50,000.
Would I not rebound at a faster job growth rate?
At some point you bottom out ... and you begin to add jobs. And if you have a larger population, and a larger group of unemployed ... you will add jobs at a faster rate.
Regarding Texas.
Yes. Fracking and oil has helped us.
The fact is Governor Perry has been prudent about using that growth to draw in other companies and not blow through the money like Swaye at a coke driven tattooed hooker festival.
It's like saying Clinton was only lucky because of the dot.com boom.
It is how he utilized his resources and built regulation around it.
The company I work for, in Texas, is adding 94 people this fiscal quarter. We employ 1500 currently. We do very little in oil and gas. However, the divisions that are vested in this sector are creating wealth, which is helping lift all boats. On the flip side our soccer loving CEO is cutting the divisions who are hurting.
The problem with government is no one ever cuts.
Bad ass FREE PUB bitches!
MikeDamone
Active poster
That's also my point. The laffer curve isn't invalid, the left and the right just use it as a political tool.
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GrundleStiltzkin
New Fish
Never would have pegged (75k) @Swaye for an old dude. Way to stay young at heart brother.
MikeDamone
Active poster
bizjournals.com/sacramento/news/2012/03/26/california-job-loss-recession-analysis.html
pewtrusts.org/en/research-and-analysis/blogs/stateline/2014/01/07/which-states-will-generate-jobs-in-2014
And you didn't comment on my post regarding economic freedom. To me, that's the core topic vs. cherry picking stats.
AZDuck
New Fish
Ranking of states by median per capita income:
1. Maryland
2. Alaska
3. New Jersey
4. Connecticut
DC
5. Massachusetts
6. New Hampshire
7. Virginia
8. Hawaii
9. Delaware
10. California
11. Minnesota
12. Washington
13. Wyoming
14. Utah
15. Colorado
16. New York
17. Rhode Island
18. Illinois
19. Vermont
20. North Dakota
21. Wisconsin
22. Nebraska
23. Pennsylvania
24. Iowa
25. Texas
26. Kansas
27. Nevada
28. South Dakota
29. Oregon (PUMP MY GAS DUCK!)
30. Arizona
31. Indiana
32. Maine
33. Georgia
34. Michigan
35. Ohio
36. Missouri
37. Florida
38. Montana
39. North Carolina
40. Idaho
41. Oklahoma
42. South Carolina
43. New Mexico
44. Louisiana
45. Tennessee
46. Alabama
47. Kentucky
48. Arkansas
49. West Virginia
50. Mississippi
http://en.wikipedia.org/wiki/List_of_U.S._states_by_income
I was working on this. You can't cut/paste spreadsheets in here very easily. Devs?
1. Maryland
2. Alaska
3. New Jersey
4. Connecticut
DC
5. Massachusetts
6. New Hampshire
7. Virginia
8. Hawaii
9. Delaware
10. California
11. Minnesota
12. Washington
13. Wyoming
14. Utah
15. Colorado
16. New York
17. Rhode Island
18. Illinois
19. Vermont
20. North Dakota
21. Wisconsin
22. Nebraska
23. Pennsylvania
24. Iowa
25. Texas
26. Kansas
27. Nevada
28. South Dakota
29. Oregon (PUMP MY GAS DUCK!)
30. Arizona
31. Indiana
32. Maine
33. Georgia
34. Michigan
35. Ohio
36. Missouri
37. Florida
38. Montana
39. North Carolina
40. Idaho
41. Oklahoma
42. South Carolina
43. New Mexico
44. Louisiana
45. Tennessee
46. Alabama
47. Kentucky
48. Arkansas
49. West Virginia
50. Mississippi
http://en.wikipedia.org/wiki/List_of_U.S._states_by_income
I was working on this. You can't cut/paste spreadsheets in here very easily. Devs?
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Never would have pegged (75k) @Swaye for an old dude. Way to stay young at heart brother.
Haha! I'm not old. Or I don't think I am. I retired like 18 months ago just over 40. It was a Navy retirement. I have another job now. Jiffy Lube, don't cha know. (gay smiley face)