Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

[trixR4kids]

Re: Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

All the blue collar jobs are gone because they are not value adding positions (that were replaced by automation).

Yeah that's kinda the problem that needs to be solved and a big difference in why the middle class no longer exists.

[alfablue]

Re: Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

Elizabeth Warren on her Facebook did a Video with Al Franken where they discuss the tax cut. They read a quote from many CEO's from Major Corporations where they state what they would do with the money from the tax cut.

In every case it was higher dividends and stock repurchase. Every single one. Not one of them said anything about worker's wages, or expansion in the US. Not one.

This tax bill is frightening to say the least.

The great thing about the buying stocks and paying dividends is 1) the tax rate on that vs. just salaries are significantly less, and 2) it goes right into a hole and rarely ever comes back out. Makes the tax cuts completely pointless.

Do people not understand our economy is 100% based on people buying stuff??? And they need to be paid a decent amount to buy stuff.

Automation is great for businesses and shareholders, but questionable at some point for the overall economy. Not everyone is going to be on that higher paying job track- some will just not have a job, and be forgotten. Like those people in PA.

[alfablue]

Re: Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

OK, the neural spark just fired so it really hasn't been thought through ...

What if the only thing in this country that could be income taxed is an individual (not corporations). And, what if every dollar that comes into an individual's hands in a reporting year, no matter the source (income, interest, cap gain, dividend, lotto, whatever) was taxed. Income is income (source agnostic).

Yes, the tax rate would sound very large to generate the revenue. But, if the corporation isn't paying workers but instead paying dividends, uh, whups, money still taxed as income to someone.

The hidden benefit: There's no longer incentives for corporations to manipulate tax code (aka buy politicians) as tax code now only affects individuals.

OK, blow up the notion. I'm sure there's an aspect I'm overlooking. (One thing I see is the company that had a big year doing a big stock buy back, unless, .... the stock bought back shows up as income to the seller.)

One issue I see with that is that wages and payments would have to go up to offset the corporate taxes. Which I suspect will be very difficult.

But otherwise, seems like a good idea. Have to think about it for a little.

[The Sicatoka]

Re: Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

Yeah that's kinda the problem that needs to be solved and a big difference in why the middle class no longer exists.

Star Trek. We all live on the Enterprise with food replicators. Solved.

[The Sicatoka]

Re: Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

One issue I see with that is that wages and payments would have to go up to offset the corporate taxes. Which I suspect will be very difficult.

Agree, wages would need to go up. And the rate would still look very scary.

However, in this thought exercise, corporations aren't paying taxes.
What'll they do with the money they make?

Higher wages? Income. Taxed.
Dividends? The receiver is taxed as income.
Stock buy backs? We talked that one above. Income. Taxed.
Capital expenditures? They buy the goods from someone who has employees who has to make the same choices (dividends, wages, etc).

What I like in here is the tacit way to get corporations out of the "buying politicians to manipulate the tax code for us" game. The tax code would affect "We the People" and maybe all of us would take notice. Democracy!

[FlagDUDE08]

Re: Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

I always find it funny how people keep clamoring that wages need to go up. All you're doing is permitting the same problems to continue, only with larger numbers. Why not look at inflation, and possibly reducing the bases that make things so expensive to begin with?

[unofan]

Re: Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

OK, the neural spark just fired so it really hasn't been thought through ...

What if the only thing in this country that could be income taxed is an individual (not corporations). And, what if every dollar that comes into an individual's hands in a reporting year, no matter the source (income, interest, cap gain, dividend, lotto, whatever) was taxed. Income is income (source agnostic).

Yes, the tax rate would sound very large to generate the revenue. But, if the corporation isn't paying workers but instead paying dividends, uh, whups, money still taxed as income to someone.

The hidden benefit: There's no longer incentives for corporations to manipulate tax code (aka buy politicians) as tax code now only affects individuals.

OK, blow up the notion. I'm sure there's an aspect I'm overlooking. (One thing I see is the company that had a big year doing a big stock buy back, unless, .... the stock bought back shows up as income to the seller.)

Companies would sit on the cash ala Apple and use it to pay for lavish "expenses" for the C-suite and Board of Directors. The other catch is company to company transactions, in your system, are never taxed. So everyone becomes a corporate entity.

Kansas tried this - they all but killed the income tax for S-corps and other small business entities. It ended up with people like college coaches creating a shell LLC that gets the majority of the pay, and out of which they pay the majority of their expenses, tax free.

[alfablue]

Re: Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

What I like in here is the tacit way to get corporations out of the "buying politicians to manipulate the tax code for us" game. The tax code would affect "We the People" and maybe all of us would take notice. Democracy!

Actually, I think that would have the opposite effect. It would be easier to spend "speech money" if it's not taxed.

[The Sicatoka]

Re: Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

Actually, I think that would have the opposite effect. It would be easier to spend "speech money" if it's not taxed.

Wouldn't it still be income to someone?

[The Sicatoka]

Re: Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

Companies would sit on the cash ala Apple and use it to pay for lavish "expenses" for the C-suite and Board of Directors. The other catch is company to company transactions, in your system, are never taxed. So everyone becomes a corporate entity.

If they're buying stuff for the C-suite and the BoD, someone's selling it --> income somewhere. If they're buying a house for a C-suiter to live in isn't there a way for that to be treated as income?

However, yes, individuals subject to individual tax would try to find ways to become "incorporated". Still, wouldn't they need some personal income? (This scenario is why I asked folks to find the hole in the idea. Crowd sourcing! )

[ScoobyDoo]

Re: Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

Companies would sit on the cash ala Apple and use it to pay for lavish "expenses" for the C-suite and Board of Directors. The other catch is company to company transactions, in your system, are never taxed. So everyone becomes a corporate entity.

Kansas tried this - they all but killed the income tax for S-corps and other small business entities. It ended up with people like college coaches creating a shell LLC that gets the majority of the pay, and out of which they pay the majority of their expenses, tax free.

Yeah, that's the problem. And it probably doesn't change the speech issue because they'd still spend on it to eliminate regulations.

[joecct]

Re: Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

Now this is a radical thought

"Abolish the corporation as a legal entity. There will be no more publicly owned companies. All businesses must have a majority owner and all owners are responsible for the debts of the company in proportion to their share of the company. The days of companies run by individuals with no real stake in the business are over. No longer will people at the top make decisions that destroy a company without suffering the consequences. No longer will people be able to walk away from a disaster they caused with a pocket full of money.

People own companies. Owners run companies. Owners enter into agreements with other owners who they trust to deliver essential goods and services. Companies can't own companies. Owners remember things. They have to view every deal from a long term perspective because the health of the company is the source of their economic health. They have to live with the history of decisions they have made. Their reputation and the reputation of their company is one and the same. They have to work to build trust. Corporate executives come and go. There's no history of decisions that will follow them. The reputation of the company is not their reputation since there's always a scapegoat who can be blamed for any failure. There isn't a need to build trust because they won't be around to get the benefits of it. They don't care about the long term because they are rewarded by the short term.

[The Sicatoka]

Re: Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

Now this is a radical thought

What about employee-owned companies? Cooperatives? And who (individual) has the cash right now to own a majority of any of the Fortune 10?

[unofan]

If they're buying stuff for the C-suite and the BoD, someone's selling it --> income somewhere. If they're buying a house for a C-suiter to live in isn't there a way for that to be treated as income?

However, yes, individuals subject to individual tax would try to find ways to become "incorporated". Still, wouldn't they need some personal income? (This scenario is why I asked folks to find the hole in the idea. Crowd sourcing! )

Unofan LLC buys all my goods and food from omnicorp using money paid to it by Sicotka Corp. for legal services rendered.

Where does the individual get involved?

And again, you don't need to crowd source, just read up on Kansas under Brownback. This particular conservative utopian idea was tried with all the others and failed spectacularly.

[The Sicatoka]

Re: Business, Economics & Tax Policy 5.0: Can a blind nut find a squirrel?

Unofan LLC buys all my goods and food from omnicorp using money paid to it by Sicotka Corp. for legal services rendered.

Where does the individual get involved?

Don't those three entities have people on the payroll (making stuff, delivering stuff)?

Like I said, yes, we'd have to find a way to keep the individual from "incorporating".