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Tax Bracket Math... Check Me If I'm Missing Something

mrplunkey

New member
Source: Blomberg

Effect of Bush Tax Cuts to Brackets:
39.6 -> 35%
31 -> 28%
28 -> 25%
15 split and dropped to 10%

2013 Financial Impact by Bracket:
cost of reducing 39.6% bracket = $52B
cost of reducing 31% and 28% brackets = $84B
cost of reducing 15% bracket = $54B

So total cost of bracket reduction = $190B

Current year's deficit = $1,010B

-------------------------
So to sustain our spending, here are the brackets we'd need:

39.6% -> 64%
31% and 28% brackets -> 47% and 44%
15% -> 41.5%

And if we only took the top bracket to 64% and left the others alone, we'd still run a $734B deficit.

If we took the top bracket to 100% and left the others alone, $386B deficit.

This math doesn't add up. Why are we even having a tax discussion over such useless tax increases?
 
Its like gun control bor, it just feels so good to talk about doing it
 
Source: Blomberg

Effect of Bush Tax Cuts to Brackets:
39.6 -> 35%
31 -> 28%
28 -> 25%
15 split and dropped to 10%

2013 Financial Impact by Bracket:
cost of reducing 39.6% bracket = $52B
cost of reducing 31% and 28% brackets = $84B
cost of reducing 15% bracket = $54B

So total cost of bracket reduction = $190B

Current year's deficit = $1,010B

-------------------------
So to sustain our spending, here are the brackets we'd need:

39.6% -> 64%
31% and 28% brackets -> 47% and 44%
15% -> 41.5%

And if we only took the top bracket to 64% and left the others alone, we'd still run a $734B deficit.

If we took the top bracket to 100% and left the others alone, $386B deficit.

This math doesn't add up. Why are we even having a tax discussion over such useless tax increases?


WTF's with all the numbers? I can't check that shit, bro.



:cow:
 
I guess you have to start somewhere to repair the damage. It doesn't stem the tide, but it's a start.
 
I guess you have to start somewhere to repair the damage. It doesn't stem the tide, but it's a start.

So singling-out 2% of Americans and hitting them with a $52B increase is a "start" to paying for a $1,000+B deficit?

Barry wants a new "stimulus" bill (Read: Personal piggy bank) that's over three times the size of that start -- so it's wasted before the cash is even collected.
 
So no move is worth the effort unless it wipes much more than 20% of the deficit? Got it. What such reductions do you have in mind that have a snowball's chance of getting anywhere?
 
So no move is worth the effort unless it wipes much more than 20% of the deficit? Got it. What such reductions do you have in mind that have a snowball's chance of getting anywhere?

I don't think we'll ever make the cuts. We need to crash first.

Republicans won't let them make the necessary cuts to defense.
Democrats won't let them make the necessary cuts to entitlements.

If you're going to spend over a trillion more than you take in every year, the brackets don't matter unless everyone goes (even the poor) to ~50% rates.

The whole argument is ridiculous.
 
People are living too long; raise the ages for SS eligibility by 3 years. I don't see why that meets any resistance at all except by people in their 60's already.
 
Name one single line item republican proposal that would add 52 billion dollars to the 2013 budget .....

. A small increase to the previous low tax levels for the wealthy, is the easiest item in budget reform. It impacts the budget the most, and has the least negative impact on the economy.
The CBO estimates a negligable impact on the economy by raising income tax rates to 39% for the top.


And LOL at 52 billion dollars being a small amount. No one ever said that it completely eliminates the deficit. Over 10 years it addes around 900 billion. Is that trivial as well?

Since Bush cut taxes in 2001, it has cost us over a trillion dollars to finance those unfortunate millionaires yachts and vacation homes (top 5%). For the top 10% it has cost over 2 trillion. Is that trivial as well?

Calculating the cost of the Bush tax cuts - The Washington Post

What has that money done for us? It has gone into the coffers of the wealthiest Americans. Did it stimulate the economy? Did it create jobs? Obviously not.

We won't kill the deficit in one year by any imaginable tax increases or spending cuts. But the CBO projects a decrease of the deficit as a percentage of GDP over the next 10 years, see page 1:


Much of that projected decline occurs because, under
current law, revenues will rise considerably as a share of
GDP—from 15.8 percent in 2012 to 19.8 percent in
2014 and 21.2 percent in 2022. In particular, in CBO’s
baseline, revenues shoot up by more than 30 percent over
the next two years, mostly because of the recent or scheduled
expirations of tax provisions—such as those that
reduce income and payroll tax rates and limit the reach of
the alternative minimum tax (AMT)—

Under and alternative scenario where tax cuts are extended the picture is bleak see page 3:​


Under that alternative fiscal scenario, deficits over the
2013–2022 period would be much higher, averaging
5.3 percent of GDP rather than the 1.4 percent reflected
in CBO’s baseline projections (see Table 2 on page 4 and
Figure 1 on page 6). Instead of declining to 61 percent of
GDP, debt held by the public would climb to 93 percent
in 2022, the highest percentage since just after World
War II (see Figure 2 on page 7).

 
Even though the Republicans don't have the nuts to say specifically how they would fix the deficit (unspecified tax loopholes etc). The Heritage Foundation has proposed some things. You can argue whether or not these cuts make sense, but one thing for sure, most would be painful. Cuts to small business support, environmental efforts, food stamps, science research, Homeland security, etc.

The easiest and most obvious steps to take are tax rates for the wealthy and cuts to defense.

FINALLY: Here's The Spending The Republicans Want To Cut (But Are Too Chicken To Say So) - Business Insider#
 
plunkey was right that neither dems nor reps really want to make the necessary cuts to their constituency. I'm glad he's at least ackowledging now that we're bloated everywhere, not just on liberal area's. Maybe some sense is creeping into the republican base that they're gonna have to take some hard cracks at defense if they are to have any kind of reasoned and rationed stance to tell democrats they have to do the same. Cause right now in washington, didn't the republicans just have a vote to take defense cuts completely out of the picture? If that keeps up it's going to push americans way over to the left and just say fuck that bring every piece of military equipment back home. How on earth are we going to talk about cuts to medicare and social security, which is fine for another 20 years btw, but say military cuts are off the table? redsam is in utter disbeleif over that one.
 
And LOL at 52 billion dollars being a small amount. No one ever said that it completely eliminates the deficit. Over 10 years it addes around 900 billion. Is that trivial as well?

First of all, they won't get anywhere close to $900B over those 10 years. The wealthy will shelter at least half (or more) or their income.

But let's pretend the $900B is real. So over 10 years, you can't even fund one of our $1.0-$1.5 trillion dollar deficits.

What great news! Instead of going bankrupt on Jan 2019, we get to hold out all the way till August of the same year! Hoooooray!

Here are some inescapable truths:

1) Spending has to be massively cut. Not trimmed, not adjusted -- massively cut.

2) Defense and entitlements both get the axe.

3) Taxes need to be raised -- a lot. And the thought that it will all come from a mere 2% of taxpayers is a complete joke. The middle class needs to take a huge hit as well. Maybe our new brackets can be 45%, 40% and 30%.

But if we don't address 1 & 2, then 3 is a non-issue anyway.

There's a part of me that wants to offer Barry a simple deal: Lock in the bush tax cuts for all four years of his presidency. In exchange, raise the debt ceiling to $30 trillion. If he wants to spend us into oblivion, so be it. We're going to get there anyway so sooner is probably better than later -- at least we'll get a shot at rebuilding sooner.
 
People are living too long; raise the ages for SS eligibility by 3 years. I don't see why that meets any resistance at all except by people in their 60's already.

I completely agree.

I'd:

1) Raise the retirement and eligibility ages for SS and Medicare by one month per year indefinitely until the programs are phased out. To keep these programs limping along in the meantime, I'd means-test the benefits and find other ways to limit exposure (i.e. copayments for end-of-life care insisted by families).

2) I'd phase-in a defined contribution-style plan that is 100% tax free (even upon withdrawal of funds) as long as it is used for retirement or health benefits.
 
Debt crisis wakeup call comes and the American response is...

tumblr_m0icichyRg1qdlh1io1_400.gif
 
The games both sides are playing right now are disgusting.

There's $190B in tax cuts hung-up because Barry wants to sting 2% of the population to raise $52B

But in the same proposal, he wanted to spend $150B on another wasteful "stimulus". So he'd spent that $52B three times over before the money was even collected.
 
First of all, they won't get anywhere close to $900B over those 10 years. The wealthy will shelter at least half (or more) or their income.

But let's pretend the $900B is real. So over 10 years, you can't even fund one of our $1.0-$1.5 trillion dollar deficits.

Arguing that you don't believe the CBO accounting is retarded. I've played that game with you before and you looked kind of foolish, but obviously you don't learn your lesson. CBO takes into account tax sheltering and every other simple minded dodge you can come up with. Sticking your head in the sand does not change the facts, though I know it is one of your favorite things to do.

What great news! Instead of going bankrupt on Jan 2019, we get to hold out all the way till August of the same year! Hoooooray!

You are still arguing that a tax increase doesn't solve the debt? You could say that about any single deficit reduction line item. It is however, one proposed change that makes one of the biggest positive impacts on the debt with one of the smallest negative impacts on economic growth.

1) Spending has to be massively cut. Not trimmed, not adjusted -- massively cut.

2) Defense and entitlements both get the axe.

3) Taxes need to be raised -- a lot. And the thought that it will all come from a mere 2% of taxpayers is a complete joke. The middle class needs to take a huge hit as well. Maybe our new brackets can be 45%, 40% and 30%.

Yeah, it sounds simple until you get into the specifics of what gets cut and who gets hurt. And taxes are not so simple. You could raise taxes on 90% of Americans to come up with roughly an equal amount to what you get by taxing the top 2%. The effect on the economy however, is the reason no one suggests it.

There's a part of me that wants to offer Barry a simple deal: Lock in the bush tax cuts for all four years of his presidency. In exchange, raise the debt ceiling to $30 trillion. If he wants to spend us into oblivion, so be it. We're going to get there anyway so sooner is probably better than later -- at least we'll get a shot at rebuilding sooner.

You don't seem to understand that raising the debt ceilling does not approve 1 dollar of increased spending. Raising the debt ceiling is required to pay our bills, many of which were caused by George Bush recklessness. Not paying the bills has never before been considered a political tactic until todays radical right took over. We have to pay our bills, and to say otherwise is treasonous and unconstitutional.

Section 4 of the 14th Amendment

“the validity of the public debt of the United States, authorized by law . . . shall not be questioned,”
 
Arguing that you don't believe the CBO accounting is retarded. I've played that game with you before and you looked kind of foolish, but obviously you don't learn your lesson. CBO takes into account tax sheltering and every other simple minded dodge you can come up with. Sticking your head in the sand does not change the facts, though I know it is one of your favorite things to do.



You are still arguing that a tax increase doesn't solve the debt? You could say that about any single deficit reduction line item. It is however, one proposed change that makes one of the biggest positive impacts on the debt with one of the smallest negative impacts on economic growth.



Yeah, it sounds simple until you get into the specifics of what gets cut and who gets hurt. And taxes are not so simple. You could raise taxes on 90% of Americans to come up with roughly an equal amount to what you get by taxing the top 2%. The effect on the economy however, is the reason no one suggests it.



You don't seem to understand that raising the debt ceilling does not approve 1 dollar of increased spending. Raising the debt ceiling is required to pay our bills, many of which were caused by George Bush recklessness. Not paying the bills has never before been considered a political tactic until todays radical right took over. We have to pay our bills, and to say otherwise is treasonous and unconstitutional.

Section 4 of the 14th Amendment

Keep blathering in circles. Maybe you can actually convince someone here that a $52B tax increase will have an impact on a $1.0+ Trillion dollar deficit.

One a positive note, the US bankruptcy will serve as a good warning to others for generations to come. Maybe someone else can learn from our ignorance.
 
1) Spending has to be massively cut. Not trimmed, not adjusted -- massively cut.

2) Defense and entitlements both get the axe.

3) Taxes need to be raised -- a lot. And the thought that it will all come from a mere 2% of taxpayers is a complete joke. The middle class needs to take a huge hit as well. Maybe our new brackets can be 45%, 40% and 30%.

What you describe in general, is the fiscal cliff. And if you care to read the CBO report on the fiscal cliff, it actually does reduce the deficit.
 
What you describe in general, is the fiscal cliff. And if you care to read the CBO report on the fiscal cliff, it actually does reduce the deficit.

The fiscal cliff is less than one-half of the financial improvements that we'd have to do. And even then, it doesn't address the re-balloning of entitlements as well as the mother of all entitlements we have coming (BarryCare).

I love watching people bitch about the measly cuts in defense and entitlements that are on the table right now. That's a far cry from what cuts need to be made.

Oh and P.S... Even if we did get to budget neutral someday, you do realize we'd need to pay down some of that $16.4 Trillion, don't you? Or does that just go on the credit card forever?
 
People are living too long; raise the ages for SS eligibility by 3 years. I don't see why that meets any resistance at all except by people in their 60's already.

When SS was introduced the average age of a male was 58. You need to move the retirement age to at least 75 to get it back in sync for what it was originally intended for.
 
I don't think we'll ever make the cuts. We need to crash first.

Republicans won't let them make the necessary cuts to defense.
Democrats won't let them make the necessary cuts to entitlements.

If you're going to spend over a trillion more than you take in every year, the brackets don't matter unless everyone goes (even the poor) to ~50% rates.

The whole argument is ridiculous.

Here is the only problem with your argument. What they have to do right now is raise REVENUE and cut expenses.

By letting all the tax cuts expire now, which they will have to do eventually, will through the economy in a recession and actually reduce revenue.

They need to come up with a phase out of all tax cuts and a phase in of spending cuts to get Defense and Entitlement back to the same % of GDP the last time we had a balanced budget.
 
Here is the only problem with your argument. What they have to do right now is raise REVENUE and cut expenses.

By letting all the tax cuts expire now, which they will have to do eventually, will through the economy in a recession and actually reduce revenue.

They need to come up with a phase out of all tax cuts and a phase in of spending cuts to get Defense and Entitlement back to the same % of GDP the last time we had a balanced budget.

I completely agree that raising taxes hurts the economy and reduces overall revenue. Art Laffer and Ronald Reagan figured that out over thirty years ago. If it's generally agreed that raising taxes now would hurt the economy, I guess it's a bipartisan endorsement that Bush's tax cuts were the right thing to do.

And the phased-in approach sounds reasonable, except for one problem. Washington loves doing multi-year plans with little or no impact until the later years, knowing full well that they'll just undo the cuts and keep spending when the time comes.
 
The fiscal cliff is less than one-half of the financial improvements that we'd have to do. And even then, it doesn't address the re-balloning of entitlements as well as the mother of all entitlements we have coming (BarryCare).

I love watching people bitch about the measly cuts in defense and entitlements that are on the table right now. That's a far cry from what cuts need to be made.



Well, you are wrong. (ah, such fond memories of explaining the obvious to Plunkey).
-Go to the CBO document link I posted.
-Go to page 7 and look at the graph.
-Note that the debt as a percentage of GDP goes down beginning in 2012.

That graph does take into account Obamacare (the baseline scenario is based on all current law), and of course it does not assume any imaginary plunkyisms that might be useful in trying to twist things in your direction.
 
Oh and P.S... Even if we did get to budget neutral someday, you do realize we'd need to pay down some of that $16.4 Trillion, don't you? Or does that just go on the credit card forever?

You need to look at the debt as a percentage of GDP. If that goes down, then it is more manageable. If GDP grows more than the debt, (as projected in the CBO baseline scenario), then eventually you get to a neutral budget, and after that, a decrease in overall debt. Even under the most favorable forecasts paying off that debt would take a long time.
 
Well, you are wrong. (ah, such fond memories of explaining the obvious to Plunkey).
-Go to the CBO document link I posted.
-Go to page 7 and look at the graph.
-Note that the debt as a percentage of GDP goes down beginning in 2012.

That graph does take into account Obamacare (the baseline scenario is based on all current law), and of course it does not assume any imaginary plunkyisms that might be useful in trying to twist things in your direction.

Debt As a % of GDP
----------------------
Sept. 30, 2012 101.6%
June 30, 2012 101.7%
March 31, 2012 100.7%
Dec. 31, 2011 99.36%
Sept. 30, 2011 97.54%
June 30, 2011 95.60%
March 31, 2011 96.32%
Dec. 31, 2010 95.18%
Sept. 30, 2010 93.04%
June 30, 2010 91.59%
March 31, 2010 89.51%
---------------------- Obama Presidency Starts
Dec. 31, 2009 87.11%
Sept. 30, 2009 85.36%
June 30, 2009 83.15%
March 31, 2009 79.92%
Dec. 31, 2008 75.98%
Sept. 30, 2008 69.64%
June 30, 2008 65.85%
March 31, 2008 66.12%
Dec. 31, 2007 64.75%
Sept. 30, 2007 63.77%
June 30, 2007 63.45%
March 31, 2007 64.32%
Dec. 31, 2006 63.90%
Sept. 30, 2006 63.33%
June 30, 2006 63.16%
March 31, 2006 63.60%
Dec. 31, 2005 63.33%
Sept. 30, 2005 62.32%
June 30, 2005 62.69%
March 31, 2005 62.91%
Dec. 31, 2004 62.65%
Sept. 30, 2004 61.82%
June 30, 2004 61.84%
March 31, 2004 61.53%
Dec. 31, 2003 61.31%
Sept. 30, 2003 60.27%
June 30, 2003 60.57%
March 31, 2003 59.34%
Dec. 31, 2002 59.49%

I think I see a trend. Should we focus on Barry's disastrous four-year track-record, or a self-serving CBO estimate laden with assumptions that will be revised yearly because it's so wrong?
 
No, he inherited a manageable problem.

Four years later, he's now inheriting his own disaster, yet noone will have him be held accountable for anything.

'He did it first' is easier than saying 'oh shit, we fucked up too'
 
No, he inherited a manageable problem.

Four years later, he's now inheriting his own disaster, yet noone will have him be held accountable for anything.

'He did it first' is easier than saying 'oh shit, we fucked up too'


A managable problem, that he is managing, after Republican mis-management, and despite a Congress that has done everything in its power to see that America fails.

Cost of 2 wars - Bush
Cost of Bank Bail out - Bush
Cost of Tax cuts - Bush
Cost of great republican Recession lost revenue - Bush.
 
He has failed to manage anything aside from increasing our massive debt.

It's too far gone, anyone who thinks putting a bandaid on it by making 'neccessary cuts' is in denial.

We must crash and burn, we've already ran it up past the point of no return, and it's not like we haven't had our credit rating downgraded before...
 
A managable problem, that he is managing, after Republican mis-management, and despite a Congress that has done everything in its power to see that America fails.

Cost of 2 wars - Bush
Cost of Bank Bail out - Bush
Cost of Tax cuts - Bush
Cost of great republican Recession lost revenue - Bush.

Well, the bail out made money.
The Bush tax cuts were already in place .
I will give you the wars but those are almost completely wound down.

So it all comes down to the recession and the revenue lost as a result, or more importantly the money spent that did nothing to help get us out of it. As we are recovering from this recession slower than any on history, one can only put the blame on the people managing the recovery.

Not a good report card but hey, I got an idea, lets re-elect all the same people captaining this ship.
 
Yes, let's. But this time, let's make sure they can't be reelected again, so they have nothing to lose.

Brilliant plan.
 
He has failed to manage anything aside from increasing our massive debt.

It's too far gone, anyone who thinks putting a bandaid on it by making 'neccessary cuts' is in denial.

We must crash and burn, we've already ran it up past the point of no return, and it's not like we haven't had our credit rating downgraded before...

I agree. We need to hit rock bottom.

And the mess Bush created is nothing compared to the mess Barry has. If I had to choose between paying for Iraq and Afghanistan all over again versus BarryCare, I'd choose the wars every time. Wars can be wound down. BarryCare lasts forever.
 
Obama has inherited quite a Republican mess hasn't he.


yeah he did but that argument is getting old. The next couple years are "square" on him and his administration. I get so mad at Reid and Pelosi for rolling that one out now that it makes me wanna slap my momma.
 
I completely agree that raising taxes hurts the economy and reduces overall revenue. Art Laffer and Ronald Reagan figured that out over thirty years ago. .


Why did it take Reagan 6 years to suggest lowering those brackets? I was just reading about historical tax brackets the other day and I saw that it wasn't until the 6th year that Reagan cut taxes....before that the top bracket were approaching 60%....i never knew that, that is appalling to nth power.
 
Why did it take Reagan 6 years to suggest lowering those brackets? I was just reading about historical tax brackets the other day and I saw that it wasn't until the 6th year that Reagan cut taxes....before that the top bracket were approaching 60%....i never knew that, that is appalling to nth power.

He cut the rates in 1981 first.

Economic Recovery Tax Act of 1981 - Wikipedia, the free encyclopedia

Then cut them again in 1986.

Tax Reform Act of 1986 - Wikipedia, the free encyclopedia
 
I'd choose the wars every time. Wars can be wound down. BarryCare lasts forever.


ok dude, time for a hard line to be drawn in your world...we're talking about wars which we now know just cost U.S soldiers lives unneccesarily AND cost 10's of thousands of innocent people their lives. Afghanistan is still up in the air but if you're making the point that even Iraq is preferable to healthcare, no matter how much you disagree with the policy, can we just take a step back and take a deep breath cause we're talking about people dying unnecessarily. And the fallout from both of those wars will still be felt decades from now, have the Iranians forgotten about the Shaw? No....so reality check dude.
 
ok dude, time for a hard line to be drawn in your world...we're talking about wars which we now know just cost U.S soldiers lives unneccesarily AND cost 10's of thousands of innocent people their lives. Afghanistan is still up in the air but if you're making the point that even Iraq is preferable to healthcare, no matter how much you disagree with the policy, can we just take a step back and take a deep breath cause we're talking about people dying unnecessarily. And the fallout from both of those wars will still be felt decades from now, have the Iranians forgotten about the Shaw? No....so reality check dude.

Trashing our health care system will also lead to people dying unnecessarily. except the effect will last forever, instead of for 10-12 years.

I'd still choose to re-live the wars over the BarryCare disaster. At least wars eventually end.
 
I have lost good friends in this war, even watched some of them die in person.


I have a titanium right foot as a result of the Afghanistan effort.





I would choose war over Obamacare.
 
ok so he initially dropped from 70 to 50%....wow, 70%, really? So you were probably, what...35 back then? Which bracket did you fall into? :coffee:






















:lmao:

I was 13 and there were a ton of loopholes back then. His 50% was more like 28%-30% by today's standards.
 
ahh ic....so you were already balls deep over at GE by this time right? :coffee:

You should remember that era well. Weren't you a freshman at Ohio Community Cybercollege, Cosmetology and Tire Care Center that year?
 
You should remember that era well. Weren't you a freshman at Ohio Community Cybercollege, Cosmetology and Tire Care Center that year?

Your snarky sarcasm aside, that wood still be impressive for a newborn no? what's your newborns doing, sitting in a crib crying? Pffftt, i was rotating tires and changing oil.


lolz^^^
 
i want to know when all people are going to start paying taxes... can't pay taxes?? that's ok we have a tax jail for that..
 
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