Dave Ramsey on Debt

[Inconel710]

I maintain that Reagan only took in more revenue because he increase borrowing and spending. Which he did.

Seriously? Tax revenue doesn't include borrowing. Try again.

You can also try reading the history books - the Democrat controlled Congress failed to live up to their side of the bargain and cut spending. So now you'll can credit them for the increase in revenue.

There is no free lunch.

Something we agree on in principle. However your actions say otherwise.

As to tax levels of the 1960s one major difference. Those taxes back then were targeted at business and other wealthy targets more than the middle class. Today the middle class pays a larger portion of their earnings in taxes than they did in the 1960s. We need to close tax loop holes like the ones that give tax breaks to corporations for outsourcing American jobs over seas.

And here I will admit that I'm no expert on 1960's tax policy. However, with almost half of the population paying zero federal taxes, the comparison changes a bit.

[Inconel710]

Would Dave Ramsey agree to a 10% flat tax for everyone? If you draw income from any source, you get whacked 10% Could be any percentage 8-18%

I think he would. He's commented on the flat tax and the fair tax before and either one would be preferrable to the mess we have now.

Everyone would have the same burden. I remember watching Warren Buffet claim he paid less in taxes than his secretary... I have a problem with that... thousands of pages of tax laws are bullshit.

You have to understand what Warren Buffet said - his tax rate is/was lower than his secretary's. He still paid something like $17,000,000 in taxes that year.

[nynco]

That model worked well in times of some real growth and confidence. A major failing al most all models is a belief in equilibrium, that things go naturally to optimal levels. Our current economic state is off the charts into the squirrelly zone. If we cut taxes I doubt if revenue will increase at all. In normal times people spend it and businesses create jobs. Now everybody will just sit on the money so no new activiity. All these models are voodoo when it comes to explaining the extremes.

nynco, I agree with your more tham most but I don't think I share your faith that more revenue now would be anything more than good money after bad. I do share many members lack of faith in the government actually living within limits without some real constraints keeping it under control. Just one little earmark here, one little emergency allocation and its back to business as usual.

Steve

There is no confidence in our current economy because our economy is no longer built on sound economic principles. Our economy no longer produces things through manufacture. Wallstreet gambling was only 7% of the economy prior to Reagan and today now stands at close to 3 times that. At the same time Manufacture went from around 25% of our economy in the 60s to less than 7% today. Wallstreet does nothing but push paper and make bets after the initial public offering. We use their health far too much. Its like making sure the parasite is doing ok while the host dies.

As to having confidence that our gov will do the right thing. I have none in 90% of our elected officials. I think we need to change the fundamentals of how we elect or officials. But that does not mean that we should cut our gov to the point that the US is weak like today.

[nynco]

I think he would. He's commented on the flat tax and the fair tax before and either one would be preferrable to the mess we have now.



You have to understand what Warren Buffet said - his tax rate is/was lower than his secretary's. He still paid something like $17,000,000 in taxes that year.

As to Warren Buffet paying lower taxes.... well that is because we tax the middle class more than the rich. Rich people don't work a job and get paid wages. They invest.... I think it is not right to tax a mans hard labor more than investment income. It should be the opposite. I think its immoral to tax a Dr more than a hedgefund manager.

People don't realize if you make 1 million as wages you pay full taxes on that. Which amounts to around 40% of earnings.

If you sit on your ass or live of daddies trust fund and your earn 1 million that year, you pay a max rate of 15%.

Its wrong and that is how we need to raise taxes.

[tmleadr03]

As to Warren Buffet paying lower taxes.... well that is because we tax the middle class more than the rich. Rich people don't work a job and get paid wages. They invest.... I think it is not right to tax a mans hard labor more than investment income. It should be the opposite. I think its immoral to tax a Dr more than a hedgefund manager.

People don't realize if you make 1 million as wages you pay full taxes on that. Which amounts to around 40% of earnings.

If you sit on your ass or live of daddies trust fund and your earn 1 million that year, you pay a max rate of 15%.

Its wrong and that is how we need to raise taxes.

Let the class warfare flow through you.

[nynco]

Let the class warfare flow through you.

Correct there is class warfare and the upper class is waging it and winning. Just because you want to ignore it does not change the facts.

Why the hell do you want to defend a system where you pay higher taxes so a hedgefund manager does not. Heck even a flat tax would be more just than the current insanity.

[two shoes]

You have to understand what Warren Buffet said - his tax rate is/was lower than his secretary's. He still paid something like $17,000,000 in taxes that year.

Ok, thank you for the clarification on the tax rate I was dumbfounded when I had heard it the first time, it makes a lot more sense now...

Still, the idea of equal burden appeals to me. Making more money should not entitle you to a lower tax rate.

[nynco]

Today in America we have a REGRESSIVE tax rate. Any one who tells you different does not understand how taxes really work or how a hedge fund manager or investor earns income.

[Ronin13]

I'm all for a fixed flat tax rate for everyone regardless of income source. However, the problem with this is that the libs would freak out and claim that because you make more $$$ you should pay a higher rate or if you make too little $$ to sustain yourself you should pay a lower rate.
Example:
Bob is an exec for a multi-billion dollar company. He makes $10M/yr. At 10% flat tax rate he pays $1M/year.
Jim is a small business owner who makes $100K/yr. He pays $10K in taxes.
Ron is a middle school science teacher who makes $40K/yr. He pays $4,000/yr in taxes. They all pay the same percent, but different amounts. Their after tax income is: Bob $9M, Jim $90K, Ron $36K. Ron gets mad because his taxes put him in a lower income bracket than he thinks he should be concurrent to his income. He petitions for people who make less than $50K/year to be special and pay a lower tax rate.... Even though $4K is substantially less than $1M because he feels rich people should pay higher taxes because it makes less impact on them the more they make. Fair, but to those rejects of society who refuse to use logic they want to punish those who work hard for their money (notice I'm not saying anything about investing, although that's the smart way to deal your money around if you know what you're doing and thus shouldn't be punished for that) and be lazy and not pay as much as the rich. It's all liberal bullshit to me.

[jscwerve]

I'll chime in I guess. Disclaimer: I know dick about economics. I think about it and my head hurts.

I do think a flat tax is a good idea. On investment income. That way all investments can be handled the same way. Same as business. the billion dollar company pays the same rate as joe blows bait shop.

Also I think that we need to give incentive for companies to bring manufacturing back to the states. I have been working in manufacturing for about 15 years now and let me tell you it's getting pretty difficult to find jobs. I don't know how to do this, import taxes? Penalties for having manufacturing facilities in other countries? I don't know how to go about that with "free trade".

I think a consumption tax would be a better idea than the income tax system. I go out and buy a $20k vehicle, I pay my (I'm guessing) 20% tax on that, the gov gets its $4k in taxes. Mr. Hedge fund manager goes out and buys a $200k bently, the gov gets its $40k in taxes. He paid more taxes, but same rate. In addition, illeagles make up MILLIONS of people that pay no taxes, yes they send most of the money back home, but while they are here they have to buy things like gas, food, vehicles, etc. Having a consumption tax instead of income tax closes the loop of people working under the table. Doesn't fix the ginormous immigration problem, but gets some money from them.

Like I said, I know just about nothing about economics, I'm a computer geek. Am I wrong to think that something like this would be a good Idea?