US Political Discussion: Biden/Harris Edition (Rules in OP)

[Thaeon]

I agree in principle that we need to do a better job broadening the tax base towards the top, and I'd love to see a few additional higher marginal tax rates.

Here, specifically, I disagree though. Unrealized gains are just that - paper gains. You can't use unrealized gains in Apple stock to buy a yacht. You can't even use them to buy groceries. They're merely the potential for gains if and when you choose to sell. If Yoy buy shares in Apple and it goes up 50% one year, you continue holding, and then it goes down 75% the next and you sell at a net loss of 62.5% of your initial investment, you get to write that off on your taxes because you lost money. It doesn't matter if you lost money because you were really smart or really dumb, the tax code doesn't make moral judgements on why gains or losses happen, it just taxes them. This would also likely have the effect of forcing people to sell to pay tax bills if unrealized investment gains or losses are large relative to current income (read: most older Americans approching retirement, during market volatility) which is the kind of thing that isn't great for market efficiency, having a whole bunch of market oarticipants transacting for non-economic reasons.

Where I would like to see tax reform on investments is in two areas - one, the long term capital gains tax rate being well below most Americans' ordinary income tax rates rewards capital over labor, which to me doesn't make much sense, and I'd support taxing realized investment gains as ordinary income. Two, I'm ultmately agnostic on the estate tax question with one important caveat - we should either have an estate tx, no exceptions, or if we don't, then we should do away with the resetting of cost basis at time of death. If someone leaves me $5mm in appreciated Apple stock bought at a cost basis of $2 a share, that sneaks under the estate tax cap, but those shares come to me both untaxed, and at a cost basis of whatever their market value was when I inherited them (currently about $146 a share). That's a pretty huge way to shelter investment gains.

I'd also rather see additional higher marginal tax rates than higher corporate taxes - corporations are essentially pass-thru vehicles, I care way less what Amazon pays in income taxes than i do what Jeff Bezos pays in income taxes, and I'd happily trade lower corporate tax rates for higher personal ones on the ultra rich.

The issue I have with paper gains not being taxable income is that any other means of non-liquid asset are taxed. Yes you have to pull the money out of the stocks by selling the shares. But you also have to do the same with real estate. Which you still have to pay an annual tax on. The share of ownership you have in a privately held company are not considered on paper. And you have to pay out based on that company's profits annually. Why are they factored entirely differently when something has public ownership via the market? You may not have directly benefitted from that profit in spendable cash in a given year, but you still get to count it as an asset for other purposes. If its an asset, and its value grows over a given time frame that is taxable for other assets, then it should also be taxable for that same given time frame. It doesn't matter whether or not you can use the asset immediately to buy groceries. It is part of your total value financially.

 

[bostjan]

[Cries in Quebec]

(For context, 30% is the lowest tax rate you get in Quebec, once you add federal+provincial together, not counting any credits, etc.)

I think he's talking about the federal rate.

Take a person in the USA, say in Burlington, VT, making $41k/yr. The Federal rate is 22%, the State is 6.6%, and the city is 1%, so the grand total is 29.6%. That's just income tax, but it combines different levels.

If the same person gets a pay increase to $100k/yr, they'd pay 7.6% state and 24% federal, so total 32.6%. If they suddenly strike oil and make $525k in one year, they get to pay 8.75% state and 37% federal, for a total of 46.75%. That's top bracket. These brackets and the levels of taxes at each bracket vary, sometimes quite wildly, from year to year.

I'm sure Canadians pay more in taxes than Americans United-Statians people in the USA, but I don't think 30% total income tax is weird here in the USA. Back in the 90's, I was barely making ends meet as a university student and I was paying more than that at roughly 33 1/3%. In the early 80's, a person making $20k/year would be paying like over 50% once you totaled federal, state, and city taxes.

One thing that I think needs to change is the idea of brackets. I'd rather see a continuous scale. For example, say you make $163,299.99. That'd put you in federal bracket 24% and state 7.6%, so total 32.6%, so you take home $110,064.19. Your boss gives you a two cent bonus out of the blue, which puts you up to $163,300.01, which means federal bracket 32%. Now you take home $97000. So two cents just cost you over $13k. Instead, the percentage ought to be calculated as a function of income. Let's say that anyone making less than N pays no tax, and anyone making more than M pays a flat rate xmax=C*(M-N), where C is some government-defined coefficient. Anyone earning an income Y between N and M pays C*(Y-N). With the current setup, C would be .4%/$k for lower-income people and .15%/$k for higher-income people. I think that alone exposes some of the unfairness of the system. If everyone was at C=.4$/$k, and N=$10k/yr, then people making $165k/yr would be paying 62% federal income tax instead of 32%. Also, with this scheme, the tax rate would be continuous, so making a better year-end bonus would never actually cost you tens of thousands of extra tax dollars for jumping out of your bracket.

 

[tedtan]

@tedtan

I guess what I'm getting at is that I see tons of folks trying their absolute damndest and still failing. That trying isn't really the issue I've ever seen. I can't tell you how many job fairs that I've attended on behalf of my union and the company I work for. There are folks so desperate for a chance and even if they get it they'll never make it. They just won't. Not because they just don't have what it takes, but because it's a coin toss, complete luck or chance or whatever.

I know you're not some über libertarian, survival of the fittest at the behest of our corporate overlords type. We have a lot of the same beliefs and politics, and as you've expanded on your original point it makes more sense. What I'm saying is I think we agree on a lot of stuff, just not this exactly.

I don’t mean to imply that there is any degree of guaranteed success, just that you can’t win if you don’t play the game. Or, stated differently, in the case of that old saying that a journey of one thousand miles begins with a single step, realizing that you need to make a change and deciding to do so is that first step. There is no guarantee of completing the journey, but there is no journey at all without that first step.

Unfortunately, many people go through life without ever taking that first step, drifting like a rudderless ship, allowing whatever happens to happen. I say it’s better to go down swinging (e.g., to try and fail for those who aren’t baseball fans) than to sit back and make excuses for not making the effort to achieve something better.

I remain unconvinced, since that's not been my experience - but then you're talking anecdote vs. anecdote vs. personal philosophies on what "ready to help themselves" means, Maybe you're right or maybe you're wrong, but in both cases it becomes really easy to say "my help would do nothing" so that you don't have to say "I just don't want to help", whether there's truth to either statement or not.

I don’t want to belabor the point, so I won’t keep posting after this, but perhaps this example may be a bit clearer:

Let’s’ say I have a brother who is addicted to opiates (I don’t IRL, but lets say I do), so I talk with him about getting clean. Unfortunately, he continues taking opiates. After trying this several times with no success, I get my parents, sister, and several of my brother’s friends together and hold an intervention. Afterwards, he continues with the opiates. Then, he gets arrested with opiates and at his trial, the judge sentences him to a drug treatment program where he gets clean while he is going through the program.

When people get out of these narcotics rehabilitation programs, some stay clean, but many relapse. So will my brother stay clean when he gets out? Or will he relapse?

That depends on him. If he is ready to get clean for himself, and he “seizes agency” and makes the decision to do so and follows through doing what he needs to do in order to stay clean (which can vary from person to person), then he’ll stay clean. But otherwise he’ll relapse because no one can make him get clean. No one can do it for him, he has to do it himself for himself.

So if he stays clean, all that help was beneficial, but if relapses, it didn’t really help him. It was definitely worth trying to help him, but it didn’t achieve the desired outcome.

 

[tedtan]

higher taxes on profits from other sources for one. I also think that not taxing gains on investments while they are still invested is a mistake. If they gain 50% in a stock one year and leave it there while markets trend down in a poor decision and lose 75% the next year, and pull their money at a loss, they get to write that off. Any other business would have been taxed on their profits and held accountable for them and thus forced to make better decisions with the money. Its zero sum in this case because either way it creates a very specific taxation advantage for the investor that allows for a situation where there is only benefit whether or not an investment fails. Its either a write-off or they don't pay taxes on it until they draw on it. Yet for all intents and purposes, its part of their valuation. Meaning they benefit in loans against net worth granting them financial power. Its not a fair practice. Sure, its high risk. But so is opening any business.

Taxing a gain without allowing a write of for a loss is kind of trying to have your cake and eat it, too, so I don’t see that working. Also, a loss is a loss, so even though it provides a write off, it isn’t a true win. It’s kind of like a football team winning a game because the other team didn’t show up. Yeah, it’s a win on paper, but not a real win.

So I love explaining boring concepts:

Those trying to punish regular people making under $1mm/yr and run of the mill successful people clearing $20mm/yr gross isn’t how you fix a broken tax system.

Corporate tax rates are separate from individual tax rates. Corporate rates rates should cap out at 50-65% at the highest marginal rates once revenues start entering the billions per year level.

Not for mom and pops making $20million/year but for fortune 500’s making hundreds of billions per year.

A 1% wealth tax per billion dollars of net worth on the individual would mean that for every billion an individual has (of which there are maybe a few hundred people in this country at that level) they need to come up with $10mm no matter what other taxes they do or don’t pay. I won’t get into the financials of how ludicrously easy this is to resolve. The argument “yeah but it’s all invested not liquid”. Doesn’t hold water when you can borrow against the assets for next to nothing and therefore defer paying any actual capital gains tax as it isn’t “sold”. Then they get to keep the securities and continue to experience appreciation on that asset.

People vote against taxes because the lobbyists ensure politicians write them to punish American citizens that need every dollar they get just to live. Of course that would make for an easy bill to shoot down. And that prevents proper taxation at the highest levels, where the IRS doesn’t have the teeth to go after.

Regular people shouldn’t be hitting a 30-40% marginal rate in the mid 100k’s is what I’m saying. And making $400k isn’t “rich” that’s just normal hard work/upper middle class.

But you find someone who thinks there is room to improve things and they say stuff like “tax everyone making over $200k”. Almost missing the point entirely of not punishing regular people.

Also universal healthcare would mean that smaller businesses could better compete as they won’t have to set aside precious dollars to offer benefits that compete with larger established firms. That’s actually pro-business, but large companies lobby against that.

Math is boring and it takes time to pick through good ideas versus good propaganda.

I can agree with a lot of what your are saying, but I’m not sure a 65% corporate tax would work. We had something similar during the 50s that worked at the time, but we (e.g., North Americans) also benefitted from a post WWII boom at that time because Europe and Japan were focused on rebuilding after the war whereas we didn’t have that burden here in NA. Without that artificial competitive advantage, 65% may well be too high.

Also, I can see taxing assets simply because they exist, but that’s a it broad; I would want to see carve outs for certain asset classes.

 

[Mathemagician]

Taxing a gain without allowing a write of for a loss is kind of trying to have your cake and eat it, too, so I don’t see that working. Also, a loss is a loss, so even though it provides a write off, it isn’t a true win. It’s kind of like a football team winning a game because the other team didn’t show up. Yeah, it’s a win on paper, but not a real win.



I can agree with a lot of what your are saying, but I’m not sure a 65% corporate tax would work. We had something similar during the 50s that worked at the time, but we (e.g., North Americans) also benefitted from a post WWII boom at that time because Europe and Japan were focused on rebuilding after the war whereas we didn’t have that burden here in NA. Without that artificial competitive advantage, 65% may well be too high.

Also, I can see taxing assets simply because they exist, but that’s a it broad; I would want to see carve outs for certain asset classes.

And you see how we had a conversation? And how no one called anyone else the devil? Normal people can discuss boring things like taxation pretty reasonably even if they don’t agree as long as there are no votes to be fished for.

I’m not delusional enough to think I’ve got stuff magically figured out, but there are directions that policy discussions can go that makes things more broadly benefit larger swaths of society.

Like all the normal worker bees barely breaking $80k.

 

[wheresthefbomb]

barely breaking $80k.

I would love to have this problem

 

[Adieu]

Taxing a gain without allowing a write of for a loss is kind of trying to have your cake and eat it, too, so I don’t see that working. Also, a loss is a loss, so even though it provides a write off, it isn’t a true win. It’s kind of like a football team winning a game because the other team didn’t show up. Yeah, it’s a win on paper, but not a real win.



I can agree with a lot of what your are saying, but I’m not sure a 65% corporate tax would work. We had something similar during the 50s that worked at the time, but we (e.g., North Americans) also benefitted from a post WWII boom at that time because Europe and Japan were focused on rebuilding after the war whereas we didn’t have that burden here in NA. Without that artificial competitive advantage, 65% may well be too high.

Also, I can see taxing assets simply because they exist, but that’s a it broad; I would want to see carve outs for certain asset classes.

65% corporate tax decidedly did NOT work

It's what led to lavish unsustainable perks that eventually tanked the big corps in USA

And high personal tax rates like 1980s Japan lead to personal perks and writeoffs instead - slow creep seniority pay, lifetime employment, and mandatory partying on the company credit card, vacations, etc.

Companies simply invent expenses and perks.

The way around it is to low-tax TURNOVER rather than profit. Really low. But on every single movement of every dollar.

 

[Mathemagician]

I would love to have this problem

Oh most Americans would. A little over 50% to be exact. And I use that number specifically because I want to drive the point home that a proper progressive tax rate should tax inflation into account. Even people making low 6 figures aren’t raging due to the costs of living in the markets where that’s possible.

Middle Class Life:
1) Maxed out 401k: $20,500 pretax

2) Marginal taxes on $60k net: $5,550

3) “Low” Rent/Mortgage Estimate: $1,700/mo ($300k home at 5.7% which is “low” for most major metros or equivalent low rent) = $20,400 for anyone saying this number is too high, $1,700/mo rent to live within 45-1hr of work is normal in major metros

4) Health insurance for individual median monthly estimate of $450/mo: $5,400/yr this is typically $1,200+/mo for families

So right now we are at $51,850 in baseline annual expenses before we even start existing.

Food bill
Electric
Water
Internet
Cell phone
Car payment (due to poor public transit)
Car insurance
Surprise Home maintenance (if mortgage)
Gasoline bill
Avocado toast ($200/mo easy)
Medical co-pays/out of pocket maximums

And that’s before anything we’d call fun. Like a single trip/vacation. You know a middle class staple.

Many of these numbers can be tweaked via smart decision making, renting with friends, eating just rice and beans, etc etc.

But that’s a rough idea of what it costs just to live somewhere that pays you $80k. And the way companies work is that if you’re making $80 you likely should be north of $100k+, so proportionally they’re still getting walked over, just less so than someone making $40 when they should be at $55+.

I’m just hoping people see it’s ok to demand more cash mooooney.

 

[tedtan]

65% corporate tax decidedly did NOT work

It's what led to lavish unsustainable perks that eventually tanked the big corps in USA

And high personal tax rates like 1980s Japan lead to personal perks and writeoffs instead - slow creep seniority pay, lifetime employment, and mandatory partying on the company credit card, vacations, etc.

Companies simply invent expenses and perks.

The way around it is to low-tax TURNOVER rather than profit. Really low. But on every single movement of every dollar.

By “worked” I mean that it didn’t cause the companies to file bankruptcy and go out of business.

Optimizing taxes to maximize the overall benefit to society is a different discussion, and, frankly, one that I haven’t looked into in the past decade (likely longer), so I’m not up to date on the details of this topic at the moment.

 

[Thaeon]

Oh most Americans would. A little over 50% to be exact. And I use that number specifically because I want to drive the point home that a proper progressive tax rate should tax inflation into account. Even people making low 6 figures aren’t raging due to the costs of living in the markets where that’s possible.

Middle Class Life:
1) Maxed out 401k: $20,500 pretax

2) Marginal taxes on $60k net: $5,550

3) “Low” Rent/Mortgage Estimate: $1,700/mo ($300k home at 5.7% which is “low” for most major metros or equivalent low rent) = $20,400 for anyone saying this number is too high, $1,700/mo rent to live within 45-1hr of work is normal in major metros

4) Health insurance for individual median monthly estimate of $450/mo: $5,400/yr this is typically $1,200+/mo for families

So right now we are at $51,850 in baseline annual expenses before we even start existing.

Food bill
Electric
Water
Internet
Cell phone
Car payment (due to poor public transit)
Car insurance
Surprise Home maintenance (if mortgage)
Gasoline bill
Avocado toast ($200/mo easy)
Medical co-pays/out of pocket maximums

And that’s before anything we’d call fun. Like a single trip/vacation. You know a middle class staple.

Many of these numbers can be tweaked via smart decision making, renting with friends, eating just rice and beans, etc etc.

But that’s a rough idea of what it costs just to live somewhere that pays you $80k. And the way companies work is that if you’re making $80 you likely should be north of $100k+, so proportionally they’re still getting walked over, just less so than someone making $40 when they should be at $55+.

I’m just hoping people see it’s ok to demand more cash mooooney.

Unfortunately where I live everyone in my industry uses recruiters. So there’s no real negotiation until after you’ve been at a place for a while.

I think people don’t understand economics well enough in general to understand that labor is a resource and the goal of resource acquisition is to get not necessarily the best person they can for as far below their market value as they can. If you got snatched up quick, you’re either a well known high performing resource, or you under priced yourself or undercut you competition. You could have asked for more in either circumstance.

 

[Mathemagician]

One piece of advice is to ask the recruiter flat out what the firm has set aside “because I’m happy where I am, and want to know it’s worth my time”.

You can negotiate intel from the recruiter off the bat because they just want bodies to get hired. If you’re interested that motivates them to share more info.

Yeah they can’t promise you anything but they may give up a lot more than whatever the initial “lowball” offer is. They are often told to offer the bottom end of whatever “range” is given. But a good recruiter doesn’t give a shit and after “trying” once they’ll just tell you what you want to know.

Hope that helps.

 

[StevenC]

 

[RevDrucifer]

We are not predestined to be what the system dictates we be; we have personal agency.

I agree that the system is fucked up, especially here in the US, but that system will never lift us up in and of itself; at best, it provides a baseline and some resources for improvement. It’s up to us to take responsibility for making use of those resources and, if need be, fighting against the system when its in our best interest to do so. While the system is fucked, we can’t use it as an excuse for failing to exercise personal agency; that’s a cop out.



Of couse people need help from others to improve their lot in life - EVERYIONE does, no matter where they happen to start out, including those that start out at the top - none of can do it entirely on our own.

What I am saying is that it doesn’t matter how much someone hepls if the individual in question is not ready to do thier part (including accepting the help). As an extreme example, if you give a severe drug addict a million dollars, are they more likely to 1) automatically check themselves into rehab, get clean, buy a house, and get a job, or 2) do a million dollars worth of their drug of choice and end up back in the same situation where they started? Option 1 is possible, but it requires the individual to exercise personal agency and be willing to make the decisions and changes necessary to effect that outcome. It doesn’t matter how much others try to help that individual if the individual isn’t serious about helping themself first.



This is an example of exactly what I’m talking about. Your ex’s family encouraged you to help yourself in life, but all that encouragement would be nothing but hot air if you yourself hadn’t taken the initiative to make a plan to go to HVAC school and improve your situation.

YOU exercised your personal agency, YOU were willing to make the decisions and changes necessary to improve your situation, and YOU followed through and made it happen. Don’t get me wrong, you had help. From your ex, from her family, from your instructors, from your fellow students, from contacts that you made along the way, etc., etc. But ultimately, YOU made the decision to excercise your personal agency, take responsibility for your life, and do what was necessary to improve things for yourself,

If you hadn’t made that decision, all your ex’s family’s encouragement would have been hot air and you would still be working retail and/or restaurant jobs.

Don’t underestimate the part you played in that equation (I’m using a math analogy for Narad ).

That decision to accept personal agency and responsibility acts as a catalyst that allows us to begin making the necessary changes, to receive the help from others, to recognize the opportunities available to us, etc. It is a necessary first step. Not the be all, end all, but a necessary first step.

And I’ve seen this way, way too many time from people, mostly immigrants, who start with nothing and end up multimillionaires, always via starting a business, to accept that the system, as fucked up as it is, predestines our lot in life. We have FAR more control over where we end up than most of us are willing to admit.

And none of it would have happened had I not experienced a different outlook on life via people who were not living in the same situation I was in. I got to see when I was younger what people could accomplish if they focused their efforts, there are a lot of people who never see examples of that and even if they do, do not have the support system to back them up while exercising that personal agency.

 

[Randy]

Welp, it's that time again

 

[narad]

Damn, I used to live right around there! I think that's probably not my old Tops, but it's like at most 3 Tops away.

“If there’s one thing I want you to get from these writings, it’s that White birth rates must change. Everyday the White population becomes fewer in number,” the manifesto begins. “To maintain a population the people must achieve a birth rate that reaches replacement fertility levels, in the western world that is about 2.06 births per woman.

“Why did you target those people?” The answer: “They are an obvious, visible, and large group of replacers. From a culture with higher fertility rates and strong, robust traditions that seek to occupy my peoples lands and ethnically replace my own people. It would have eased me if I knew all the blacks I would be killing were criminals or future criminals, but then I realized all black people are replacers just by existing in White countries.”

 

[TedintheShed]

I wrote this rant a few days ago.

Damnit, Democrats. Damn you all to hell...​

Your feckless leader just canceled a million acre gas/oil lease. Do you understand the effect this will have on just fuel prices but the economy as well?

I can't think you and your leaders are that stupid. I think it's intentional. I think you are purposefull inflicting pain in a piss poor attempt to spur the green sector.

But worse of all, now you got be considering doing something that I have done in over 3 decades: voting.

I am principally and morally against voting. It's immoral. But still,...

And worse yet, I'd be casting a vote for a man I loathe and hate. The Tangerine Tyrant. But what choice would I have?

Assholes.

Hopefully it won't be so close that I would feel the need. At this rate, thats likely.

Still...you're assholes.

/rant

 

[Randy]

I wrote this rant a few days ago.

Joe Biden sucks but I reckon this is a little oversimplified a gripe or solution.

Sometimes the issue they're chasing down is just (like climate change or banning Russian oil) but not enough effort is made to insulate average Americans from the fallout from those decisions or help move them along to step 2.

When the gas prices started creeping up the first time, I saw it start with Mayor Pete and then parroted among pundits (Colbert among them) "Oh well, here's the reason you should be driving an electric car". And maybe ultimately driving traditional gas powered cars is something we need to move beyond (maybe not), but telling people driving a 10 year old car that can barely afford their mortgage that they should buy (err.. get on the waiting list for) a $48,000 car is ludicrous. The fact this was an actual talking point they are floated out there tells you everything you need to know about the disconnect between this administration and average Americans.

I think running straight to Trump or anyone else that says drill baby drill is just kneejerk reactionary stuff that's either not gonna get you the outcome you hope for, or it's going to be a bandaid and you're gonna have to revisit your oil dependency another two, three or four years later anyway. There was plenty wrong with Trump and even supposing that specific thing is better while he's in office (gas prices), whatever he did while he was there didn't protect us from the circumstances that happened barely two years after he left. Long term solutions shouldn't be that volatile.

 

[thraxil]

Yeah they can’t promise you anything but they may give up a lot more than whatever the initial “lowball” offer is. They are often told to offer the bottom end of whatever “range” is given. But a good recruiter doesn’t give a shit and after “trying” once they’ll just tell you what you want to know.

I have some in-demand skills on my resume/LinkedIn and as a result get TONS of recruiter emails. I'm not looking for a new job so I used to just ignore them. Lately, I've been replying to every one that has a salary range listed and telling them that I already make significantly more than the range they stated (sometimes I do, sometimes it's a lie) and that they should tell their clients to adjust to the current market rate if they want to find qualified candidates. Hoping that helps someone else make a bit more.

 

[Andromalia]

Your boss gives you a two cent bonus out of the blue, which puts you up to $163,300.01, which means federal bracket 32%. Now you take home $97000. So two cents just cost you over $13k

Taxes don't work that way in *any* country. (that I know of)
The upper brackket only applies to the part of the money that is inside it. To take your exemple, you'd pay 32% only on the 1 cent that is above the previous bracket. Earning more gross money *never* results in a net loss.

In France we pay:
11% for the money between 11K to 26K
30% on the money from 26K to 74K
41% on the money from 74K to 160K
45% on everything over 160K.

I believe brackets in the US work in the exact same way, just with different numbers and tresholds.

 

[spudmunkey]

Taxes don't work that way in *any* country. (that I know of)
The upper brackket only applies to the part of the money that is inside it. To take your exemple, you'd pay 32% only on the 1 cent that is above the previous bracket. Earning more gross money *never* results in a net loss.

In France we pay:
11% for the money between 11K to 26K
30% on the money from 26K to 74K
41% on the money from 74K to 160K
45% on everything over 160K.

I believe brackets in the US work in the exact same way, just with different numbers and tresholds.

Indeed. Federal income tax is a progressive tax here in the US, as well.