Some quick numbers:
- Nationwide, our total personal income last year was just a hair over $12 trillion.
- If the tax burden on that income were the 12% recent historical average, we'd kick another $337 billion toward our public debt.
- Unfortunately, we have just under $17 trillion in public debt at the national, state, and local levels.
But what are we spending that money on? Check out this graphic:
Right now, the recession, the bailout, and the stimulus are responsible for about 60% of our deficit. But the bailouts are wrapping up and putting cash back in the kitty. The stimulus runs out next year (which is the first thing every South Dakota legislative and gubernatorial candidate should be talking about). Heck, we might even get out of Iraq and Afghanistan. For most of the coming decade, the single biggest deficit driver will be the Bush tax cuts—i.e., our unwillingness to pay for the fighter jets, border patrol agents, Medicare drug benefits, and other goodies that we all love and that not one serious candidate for South Dakota's lone House seat is willing to part with.
Candidates can talk all they want about reducing government. We still have to pay the bills we've already racked up. And current tax rates suggest we are all shirking our responsibility to pay for what we've used.
If you're serious about eliminating the national debt, step one is to let the Bush tax cuts expire... unless, of course, you can identify $693 billion to remove from the annual budget by 2019.
What do they base total personal income on? What do they divide that by - the number of taxpayers, the number of households in the US, the total US population? Makes a huge difference.
ReplyDeleteMedicare tax 2.9%, Social Security is 15% if self-employed and 7.5% if working for someone else who pays the other half, and withholding is on top of that. Real estate taxes. Sales taxes. License fees and wheel tax. Cigarette tax if you are unlucky enough to be hooked on that. Estate tax will be back. And all this is supposed to add up to only 9.2%!!! What dream world do you live in.
You need to factor in those who pay no fed income taxes, those who pay but get back more than they pay in thru earned income tax credit, etc.
And on top of this, not replacing any of it, is the coming VAT tax is Obama et al have their way.
Yes, we are TEA (Taxed Enough Already)! If you aren't, you definitely aren't paying your fair share. Feel free to contribute more!
The more taxes you take from people, the less they have to work with to develop their businesses, purchase stuff, grow the economy, etc. Of course, the more you take from working people to redistribute via the gov't, the bigger the gov't grows and the more power it has and the more dependent people become on it. Whoops, I just let the cat out of the bag about the strategy of this administration!
No secret on total personal income: <a href="http://www.bea.gov/national/nipaweb/TableView.asp?SelectedTable=43&ViewSeries=NO&Java=no&Request3Place=N&3Place=N&FromView=YES&Freq=Year&FirstYear=1950&LastYear=2010&3Place=N&Update=Update&JavaBox=no'>the chart I cite</a> for the $12T figure breaks down the elements of total personal income in the left-hand column.
ReplyDeleteThe question remains, Linda: How do we pay for what we've already spent by paying less in taxes now?
Part of what Obama has "spent" is still sitting in a kittyslush fund somewhere and unspent. Put it all back toward paying down the debt. That includes unspent TARP, paid back monies from TARP, unspent stimulus.
ReplyDeleteRepeal the health care law which will bankrupt an already bankrupt nation. It's already costing more than O promised, and it hasn't even kicked in yet. Kick it out!
Don't over-regulate small businesses. That plus the unknowns in Obamacare and the threat of cap and tax are preventing businesses from expanding, hiring, and growing the economy, which would in itself start to pay more money into the coffers of gov't.
Do NOT do cap and trade (Tax). One of the main promoters, I don't remember his name, admitted that this would not reduce admissios. But it would raise money for certain politicos and greatly negatively impact business growth.
Then, get out of the UN. They don't like us, they criticize us for the AZ law (which NEITHER Holder and Napolitano have read!) but not Iran or China. And who pays the majority of the costs of the UN? Right, the U.S., translated you and me. And it's a waste; heck, they nominated Iran to be on the human rights commission there (ever hear of Sharia law, stoning women, no free speech, etc etc).
Then get us out of the IMF. We pay 17% of their bills too. In order words, you and I thru our taxes bailed out Greece which didn't even try to fix its own problems but was rioting in the streets to keep their excessive spending perks.
Do the above, and I don't think we'd have to raise any taxes.
Then replace our income tax and most other taxes with a flat tax. You make X amount, you pay X amount, period. No more freeloaders. Everybody pays something.
No more earmarks. Term limits for senators and represenatives which would greatly limit special interests and their costs.
Just a few ideas. Socialist ideas do not work, as can be seen in the economies of Europe and where ours is heading - straight off the cliff just like Greece.
And Cory, we have NOT bought all you want us to pay for. We don't want most of it, and we told DC so. They didn't and don't listen. Much of their spouts have been shown to be empty promises and outright lies. To give us something we don't need and don't want and then to tell us that they will need to increase taxes to pay for it is reprehensible. DC had better get used to people saying NO!
Hello Nonnie-
ReplyDeleteDo you support the repeal of the medicare prescription plan?
Do you support the elimination of WIC?
Do you support the elimination of Medicaid?
Should the state of South Dakota send back half its federal highway budget every year?
If you could answer the above questions, it would give me a better idea as to where you draw the line.
Last year, federal taxes (including self-employment tax) consumed approximately 25 percent of my income. I think that's pretty reasonable.
ReplyDeleteReasonable -- and enough.
In my opinion, the Bush tax cuts, the war in Iraq, and some of the bailouts were mistakes -- as well as the "ownership society" mania that both parties exacerbated by purveying illusions as to who could afford what.
I think our government is quite powerful enough, thank you. Too powerful, in fact, and too concerned with micromanagement while letting the dinosaurs run loose in the den.
Maybe I'll accept higher taxes when I become convinced that such will result in a decent deal and not a ripoff or an attempt by the government to extend their power as an end in itself.
Stan, believe me, I don't want anyone taking more money out of my pocket right now, either. But the question remains: how do we pay for what we've already bought (the nearly $17 trillion of public debt at the federal, state, and local levels)? Nationally, even if Linda can convince me that some big chunk of that debt is really a bunch of programs over the last 50 years that the majority of Americans didn't want (didn't want what? the Air Force? Medicare? what?), we can't very well just skip out and not pay, can we? We can't just tax Democrats, or just Republicans. I'm not seeing the practical roadmap from the "Taxed Enough Already" people on how we satisfy the obligations we've already racked up. What's the payment plan, Linda?
ReplyDeleteOh, and sorry about the sloppy HTML above: see the clear explanation of "total personal income" in the chart I cite. Sorry, Linda, sometimes you really do have to adjust your worldview around actual numerical facts. You can't deny every number that doesn't fit perfectly with your preferred opinions. Taxes are relatively low right now. How can we justify that when we are so much in debt?
ReplyDeleteThank you, Tony. Those who pretend to rail about the federal budget (and I too have concerns), should be ready to tell us how SD will live without the more than 1/3 of the SD state budget that comes directly from the feds. Or what other direct transfer payments to South Dakotans to cut: SS, medicare, mothball EAFB, cancel the farm bill, stop federal aid for roads, sell the Black Hills, scrap EROS? -- pick your poison. Cowboy up or change your tune.
ReplyDeleteAll politics is local - to include overspending. Do we really need 14 more counties than has Montana, more school districts than we have counties, four lane roads to towns shedding schools & population, etc?
John Kelley
John Kelley
Cory, I don't want the irresponsible spending of the present administration which is ratcheting up spending like there is no tomorow. There are problems with past programs too, promises they wouldn't cost more than X, and in fact they balloon to XXXXX! Part of the solution is to grow the economy which will bring in more money. I already mentioned how we could save a ton of money; go back and read.
ReplyDeleteAnd we pay a heck of a lot more in taxes than 9%. Maybe we are paying part of your share if you aren't paying too much??? And BTW we are not rich, but we are too rich to qualify for earned income tax credits, tax rebates, etc.
The time has come for the entire world to learn to live within their means, starting with Greece and US! The gov't can't continue to promise everything to everyone and then wonder how to pay for it. Once again, individual responsiblity vs. gov't dependency. I will never convince Cory of this as he believes in shangrila, socialism, whatever, but it doesn't work because as Margaret Thatcher said, "Sooner or later you run out of other people's money."
Cory,
ReplyDeleteI do not know how we can get out of the current mess without raising taxes in some way.
However, that said, I offer the following opinions.
(1) The current administration wants to impose western-European-style social democracy in the United States.
(2) The runaway spending now taking place manifests the deliberate and systematic engineering of a "crisis," intended to convince the American people that massive tax increases are necessary to prevent an economic meltdown.
(3) Our previous president spent too much and perhaps taxed to little (in the form of ill-advised tax cuts), but the current administration is now committing that mistake to the nth power on purpose.
(4) The current administration has believed, and still believes, that they can place the blame for all of our economic woes on the shoulders of the previous administration, and that we, the American people, will actually swallow such rhetoric.
(5) We, the American people, will not swallow this thinly veiled plan. We will vomit it back up at the current administration in the November elections.
Linda, "Shangri-La" is denying the facts presented in the original post, that the biggest contributor to the debt is not the current administration which you so dearly want to keep whacking but our past spending and irresponsible tax policy. I'm not advocating socialism: I'm advocating paying for what we've already bought. We both want responsibility...
ReplyDelete...but only Tony, John, and Stan are responding with a cold hard grasp of the facts. We have to pay down the debt. Taxes are the only place where we get money for that debt. We've historically paid higher tax rates and survived. We need to show the responsibility of past generations and accept the burden of paying down the debt.
Stan, I think an equivalently reasonable argument can be made that the previous administration sought to engineer a crisis by spending more, taxing less, and inflating the debt to such unmanageable proportions that future administrations could not sustain any expansion of government and would have to follow Grover Norquist's path of shrinking government until it's small enouh to drown in the bathtub.
Stan-
ReplyDeleteDo you really believed the economic meltdown was an engineered conspiracy to set in place new social policies? I mean, seriously, the housing bubble got started in 2000-2001. This would be a 10+ year conspiracy involving thousands of players who are all self interested. If so, this would have been the best kept secret EVER.
Now, directly to your point:
(1) Poll after poll shows that the majority support socialized health care. You can't impose something on those that want it.
(2) Massive, runaway spending? The runaway spending is leftover crap from the previous administration.
(3) The current administration is spending vastly less than the previous administration. If anything, it's fiscally conservative by comparison.
(4) I think we can all agree that there were many factors that lead to our current economic downturn. I believe that current administration's policies are attempts to address them. I don't see the president addressing the public weekly and simply pointing at the previous administration.
(5) Conspiracy? Really? If you mean socialized medicine, the majority support it.
Tony and Cory,
ReplyDeleteI did not say "conspiracy." I said "plan." I honestly do believe that many in the current administration want western-European-style social democracy in the United States, including socialized health care and a general expansion of the public sector.
I in fact support socialized health care, and will call it that outright and without apology, even though I believe that most Americans do not want it.
There's a lot of good to be said for the social-democracy paradigm, and I don't mean to bash it; France and Germany and Sweden are not exactly hell-holes. However, again, I think most Americans don't want to live under that sort of system.
Between my belief in population control and socialized medicine, one could easily get the idea that I am way off to the left -- and in these respects, I am. So at least, I'm not a hard-line, 100-percent conservative ideologue. Maybe three-quarters, though.
As for my possible Libertarianism, that goes down when I express the belief that our President should take the oil spill crisis "by the horns" and acknowledge it as a massive catastrophe that imperils the security of the American people, and then get up the gall to do what has to be done here (call in the military and take it out of the hands of B.P.). But that's a topic for another post, maybe. (How about it, Cory?)
Nothing like an ideological war inside one's own head. Makes life interesting, at least.
In particular, I'd like to see some hard evidence that the current administration is spending less than the previous administration did. As far as I can see, they're spending more.
I will agree that we are in the current mess largely because of things that occurred during previous administrations, especially the Bush administration.
But that concept just won't work for most Americans anymore. It's President Obama's baby now, and he's going to take the credit or the blame for what happens on his watch from here on in.
Again, I never said "conspiracy"! I did say "plan." I could be quite wrong, of course, and I really hope so -- for if I'm right, then the liberal Dems in the current Congress (especially the house) are playing a dangerous game indeed.
actual tax burden broken down by type is not 9.2%. For the people burdened the least it is 38.9%. I especially love the chart though, which blames the economic downturn for deficit spending for the next 10 years, I guess even they don't believe the country will leave recession under Obama. That is followed closely by the repeated blame on tax cuts for deficits. Here is some reality on Federal revenue. Bush cut taxes by 1.3 Trillion but the difference in revenues since 2003 have all been positive. There is zero deficit caused by those cuts. Keep the general number of 2 trillion in revenue in mind when looking at our debt and you would have to be an absolute progressive fanatic to believe tax cuts have been responsible for the deficit. It also should put in perspective the level of irresponsibility it takes to add 10 Trillion to the countries debt in 10 years.
ReplyDeleteSo what is the solution? spend less than 2 Trillion per year. It doesn't matter how good a program is if we cant afford it.
ReplyDeleteMilitary: cut by 1/2. Medicare/Medicaid/SS: divested to the states to administer the payroll taxes and benefits and change them as they see fit.
Revoke the health care bill.