Top Of My Head

Thoughts on everything from Politics to Video Games

Tag: Congress (page 2 of 3)

Republican Jobs Plan

Is it me?  Because I just don’t get it.  I don’t understand how the Republicans can keep coming back to the same old / same old and think that it will work.  Yes, Ronald Reagan cut taxes in 1981, but he raised government spending (and I’m really simplifying because monetary policy had a lot to do with the recovery).  The idea that the country can get our citizens back to work via lower tax rates and the reduction of government regulations is a one that is not based on any facts.

Here’s what drives companies to hire people – it’s simple, but true:  DEMAND.  That’s it, demand for a company’s good has to be high enough for the company to hire more people.  PERIOD.  If we’re not out purchasing Ding Dongs, the Ding Dong factory up the road is not going to hire more people.  It doesn’t matter how low a company’s taxes go, they’re NOT going to hire anyone they don’t actually need.

I don’t understand why it is that the Republicans in the Senate (led by John McCain) and the majority of the Republican Candidates for President do not understand the basics of economics.  And, actually, I do understand why Michele Bachmann doesn’t – the woman doesn’t know that Abraham Lincoln wasn’t a founding father and that Elvis is dead.  I understand why Rick Perry doesn’t get it – he’s a politician. But, Mitt Romney and Herman Cain are businessmen – Romney hasn’t been one for quite a while, but Cain did an impressive job turning around the Godfather’s Pizza business.

How can either one of them say, in all honesty, that they would hire someone they don’t need in a company just because taxes are low?

Why would anyone?

The truth is that consumers are tapped out.  I’m tapped out, you’re tapped out.  We’ve pretty much purchased everything we wanted in the last, say, twenty years.  I have a house.  I purchased two cars – one new, one used – within the past two years.  Other than buying some Christmas presents and a new cell phone, quite honestly, I’m done.  Finished.  There’s no more spending coming from my house.  It is time – and this is probably anti-Patriotic of me – to do some saving.

There’s a lot of people out there who are just like me.

So, how does the economy improve?

By the government spending, spending and spending some more.  I don’t like the concept, I don’t like the idea, but that’s what has to happen.  We can’t lay off 15,000 government workers in one state and expect that state’s economy to make any improvements.

We have been neglecting our infrastructure in this country for years.  Now is the time to fix the bridges, the roadways, the levees, our schools and whatever else needs fixing.  Now is the time for the government to spend.

There’s a balance that has to be met.  We can’t have too much government money pumped into the economy or it will push out private investment.  We need to find that balance.

But, we are not going to improve the economy by cutting more taxes and reducing even more regulations.  The Republicans need to start singing a new tune, because the economy can’t march to the one they’ve been singing.

Herman Cain’s 9-9-9 Tax Plan

When it comes to taxes and being told what’s going to cost me more money and what’s going to save me money, I generally don’t believe the Press, or the person touting the plan.  What I do believe is taking what I pay in taxes now and comparing that to the new plan.

This is what I did when comparing the “savings” Paul Ryan’s plan touted.  This is what I have done with Herman Cain’s plan.

Now, there is something I’d like to add.  Mr. Cain has not made public a lot of details about his plan.  It is possible that I am making incorrect assumptions.  I am listing the assumptions that I have made before the comparison – if anyone knows for a fact that the Cain plan doesn’t do any one of these, please leave a comment and I will make adjustments.

  • No deductions: personal exemption, neither Medical nor the Standard Deduction.
  • Taxes on everything: food, gas, clothing and bills such as electric and cable.
  • Even though when I purchase my next home or car – and only if Cain’s plan passes – I would pay a 9% sales tax on the home or car, I did not include this in my car payments, nor in my mortgage payments.  I made the assumption that the 9% tax would not be retroactive.  Therefore; in my total spending, I did not include my mortgage nor car payments.

I picked last month for my spending.  I figured September is a typical month for me.  Some months I might spend more and some months, I spend less.  For comparison purposes, I included Paul Ryan’s plan in my chart.

 

Current

Ryan’s Plan

Cain’s Plan

Salary

$5,416.67

$5,416.67

$5,416.67

Insurance Deduction

$253.44

$0.00

$0.00

Personal Exemption

$291.67

$316.67

$0.00

Standard Deduction

$483.33

$1,041.67

$0.00

Taxable Income

$4,388.23

$4,058.33

$5,416.67

Federal Income Tax

$784.18

$1,014.58

$487.50

National Sales Tax

$0.00

$0.00

$399.09

Total Tax

$784.18

$1,014.58

$886.59

%

17.87%

25.00%

9.00%

This is based on one month’s salary and all the spending for the household.  In the month of September between bills (cable, electric, cell phone, etc.), food, household items and misc. items (books, software), I spent $4,434.30.

As you can see, I currently pay – each month – $787.18 in Federal Income Tax (after deductions, which really aren’t taken out until the end of the year, but I wanted this to be a fair comparison – apples to apples).  Under the Cain Plan, I will only have $487.50 taken out of my paycheck for Federal Taxes.  That’s a savings of $299.68.  That sounds pretty good.

But, wait – there’s more…

Once the addition of the sales tax on $4,434.30 of goods and services is paid, my federal tax bill is raised by $399.09 – almost $100 more than the initial savings.  This brings my total taxes under Herman Cain’s plan up to $886.59!  Clearly, the Cain Plan is not a winner for me.

Let’s deal with the critics on this.  I’m sure some people are saying, “Just spend less.”  Hmmm, nice idea, but then what’s the point?  If, in order to save taxes, I slow down my spending, then for what am I working?  What’s my motivation for earning more money?  What do I get and how does the economy get rolling along if I cut my spending in half?

Let’s say I only spend the essentials – cut out the extras, like eating out or my passion for books – what happens then?

Well, I would save $52.80 in taxes each month.  And, sure, I could sock the extra money away in savings, but who wants to live like that?  I don’t drive up to Brookfield every single day to not enjoy the money I spend.  I sock away savings and money for retirement, but then I enjoy life.

And, how will I pay for that next car?  Sure, I could use my savings, but when the average car price is around $20,000 an extra 9.0% in sales tax is really going to make a huge difference.  That adds – without any other taxes or licensing fees – and extra $1,800 to the price of my new car.

Perhaps, Cain’s plan won’t take food or, maybe, cars will be exempt.  Wouldn’t that be subsidizing certain industries and isn’t that one of the ways we ended up in this mess in the first place?

Here’s what I recommend – don’t take my word on whether or not you like the Cain Plan.  Do the math for yourself.  Figure out exactly how much more or how much less you’ll pay in taxes.  Come to your own conclusion.  That’s what we should really be doing anyway.  Checking out the plans and weighing our options.

Happy Calculating!

Warren Buffet’s Tax Rate…

Warren Buffet released his 2010 taxes for Congress’s review.  He wanted to prove his point that the rich do not pay their fair share in taxes and that they can afford to pay more.  After comparing his tax return to my tax return, I so agree with him.  I earned .10% of what Mr. Buffet earned last year.  That means, for those of you who are math challenged, he earned 1,000 times as much as I did.

Now, if all is fair, then he should’ve paid 1,000 times more than I did in taxes.

Except, he didn’t.  Everything being equal, he should’ve paid $8 million in taxes.  He didn’t, he paid just under $7 million.  I can hear the argument now, that’s more than you paid.  If you don’t like it, why don’t you go get rich.  (Usually, these arguments come from people who make half as much as I do.)

How can a man who make 1,000 times more than me pay a tax rate that is only 2% higher than mine?  How is that fair?

Well, I have to go to work, where 1/3 of my paycheck goes to taxes and insurance before I even come home.

373 – 1

373 – 1 => that’s the difference between your salary and the salary of the guy on top.  For every dollar you earn, a CEO is earning 373 dollars.  And, what do you get for that huge difference?

You get a boss who thinks you’re paid too much.

You get a boss who wants to raise profit margins and he does this by laying off your co-workers or even you.

You get a boss who is more than willing to move a factory overseas to save money, so he can make even more.

You get bad health insurance – if you have any health insurance at all.

You get to save for your own retirement out of the little bit of money that you have – and you get politicians that want to take away your safety net.

You get the feeling that you are expendable.

We could blame the government for our nation’s economic woes.  However; it isn’t entirely the government’s fault.  Greed is good, so the saying goes.  Except, greed is only good for those on top and it harms those of us on the bottom rung (and, even those of us a couple of rungs higher).

Perhaps, the government should take some, but not all, the blame.  It was the government that removed the financial regulations that had prevented a financial collapse for sixty years.  The free market system would work if only greed and the ever desire for higher and higher profit margins wasn’t part of the deal.  When men (and women) only concern themselves with profit and not sound business decisions, economic collapse ensues.

I’m not entirely sure what can completely fix our economy, but I can tell you what won’t and what hasn’t.  Lowering taxes even farther and ending financial (and other business) regulations are not going to put this great nation back on solid financial footing.  We need to put the Glass-Seagull act back into place to protect our financial markets.  And, we need to raise taxes on the upper classes.  The top limit needs to be moved back to 39%.

Ronald Reagan was correct to lower taxes in the eighties.  It was a good thing and it started economy recovery.  However; too much of a good thing can do us harm.  Our current economic status is proving just that.

House Bans Base Chaplains’ Religious Freedoms

The House voted to ban Base Chaplains from being allowed to perform same-sex marriages. Talk about a blow against religious freedom. If a Chaplain’s religion or his own religious beliefs do not prevent him from performing a same-sex marriage, who the hell is the House of Representatives to prevent the marriage from taking place. I swear it is like the right-wing House hasn’t read the same Constitution as the rest of us.

“Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof;”

Shame on those House members who voted for the ban.

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Paul Ryan’s Budget Cuts

$58 billion dollars.  That’s it.  For the remaining 7 months of the year, the grand total of his cuts amounts to $58 billion dollars.  All of it is coming from Non-Security Discretionary spending.  We’re going back to the spending of 2008.  Woo Hoo!  Gonna be good for the country.

Except, it’s not.

You see the Republicans got their tax cut extension for the one group in America who can afford it:  the rich.  Do you have any idea how much money that is?  No?  Well, let me tell you.  Giving a tax cut to the people who 1) caused the economic mess and 2) haven’t been hiring and 3) treat their employees like chattel in a bad economy, because – well, where the heck are you going to go?  has cost the country’s coffers $139 billion.

So, we gave a tax cut to the rich and powerful, but those who need the assistance will end up losing. Does that make sense?

I understand we have to cut our budget, but when the economy is just starting to improve – now is not the time to do so. The rich can afford to pay their taxes. If you’ve ever read Paul Ryan’s Roadmap for America, you’ll see that he considers a single person earning $50,000 per year rich enough to pay 25% of their hard-earned salary to the Federal Government. If you’re married, you get to earn $100,000. But, people who earn $379,000, can’t afford 39%? Excuse me?

Considering, with the dismantling of medicare and the underfunding of Social Security, that I won’t ever take Federal money, I find it really disgusting that Ryan is going after the single middle class so hard. The Republicans don’t or won’t support gay marriage, but they sure love to take our money at tax time, don’t they?

Just my little rant for the day…

Good News and Bad News

The way the media made last November’s election sound, you would think that our newly elected officials were actually going to do the right thing. Instead, the people who were elected promising to bring jobs to Wisconsin passed the bill lowering the standard for the minimum auto insurance – a passing that will not actually lower anyone’s premiums. There was nothing in there that said the insurance companies would actually have to lower rates.
I’m mad because I have carried extra insurance for years. The raising of the minimums meant good news for me. If I am injured in an auto accident, I’ll be covered by my own and by the offenders insurance. The minimums that were in place were such that in the case of a serious accident, I shouldn’t lose my house if I can’t work. Well, no more.
Thanks a lot, elected officials. Thanks for nothing.
That’s the bad news.
The good news is in Washington a bipartisan effort rejected an extension of the poorly named Patroit Act.
Both the White House and the GOP leadership are upset by this, but I don’t care. It needed to be done.
Now, let’s move on to creating some jobs!

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Taxes and More Taxes

The election is over and now it is time for the lame duck Congress to get back to work. But, even though it won’t do any good, I wanted to bring up taxes.

Everyone thinks – Warren Buffett the exception – that they pay too much in taxes. Because I have an extra taxable amount added to my normal salary this year, Cheryl and I have been paying a lot of attention to just how much we’ll owe in taxes come April 15th. By my calculations, between the two of us, we’ll owe a grand amount of $12,126, a tax rate of 13.40%. For a fun time, I thought, “Hey, what if we could file our federal income taxes jointly?” So, I used the IRS Withholding Calculator and did just that. If we were married, our tax amount would be $11,281, a tax rate. That is a tax rate of 12.47% and a total of $845 less. It makes me mad every time I think about it.

What is it that Cheryl and I receive from the federal government that is worth the extra $845? Do we have extra rights? Extra protections? Will the government take care of us when we’re old and gray in a better manner than a straight, married couple?

No, no and – I know you’re shocked – no.

We receive NOTHING for the extra dollars removed from our paychecks every single year. And, if Paul Ryan gets his way, it will only get worse. (Check out Paul Ryan’s Roadmap for America and you’ll see his plan for two tax tiers.)

By denying gay couples the legal right to marry at the Federal level, the nation is over-taxing approximately 770,000 couples in this country.  Let’s make a big assumption, because I don’t have actual figures on incomes, that our over-taxed amount is what every other gay couple pays more than straight couples.  That works out to an extra $650,650,000 in the nation’s tax coffers.

Do we get a thanks for that?

No, we don’t.

Maybe, that’s the real reason why the right-wing doesn’t want us to get married.  That’s a lot of dough!

As a gay person, I purpose that in the next election, we come together to fight for our marriage rights.  We fight for equality.  We’re paying a lot of money to be considered second class citizens.

Who’s with me?

Below is a video I made last August.

Lack of Republican Solutions

Did Republican Leader John Boehner really say on Sunday we can’t “begin to talk about potential solutions”?  Honestly?

Why not?

Are we really going to allow the nation to fail for the next two years because the Republicans don’t want Obama to succeed?  How does that work?

High unemployment?  We’re sorry, but if everyone who wants a job had a job, Obama would get the credit.

Is that there answer?

Is anyone paying attention?  Or, are we all drinking tea?

Dan Rostenkowski

Dan Rostenkowski died today. He may have gone to prison, but if I remember my childhood, he was well liked in the Chicago area. RIP, Congressman Rostenkowski.

You can read the article about him here.

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