Fiscal Cliff Means 50% Tax Rates For The Middle Class

Money Morning ^ | 12-7-2012 | Money Morning - Keith Fitz-Gerald

[trebb]

Per the gun companies, they have already driven the People to arms, they just haven’t lit the fuse that makes them go “BANG!” yet.

[VRWC For Truth]

They’ll be lucky to collect half of these new revenues. If you want less of something, tax it. So there will be less income and therefore less revenue. Law of unintended consequences. The system is dysfunctional because there is no restraint on spending. The solution isn’t revenue. The solution is spending. Going over the cliff is going to accelerate the demise of this corrupt system. The ‘Rats and GOP have sown the seeds of their own demise. Lock and load.

[bert]

You are likely correct. The argument boils down to will the “rich” be forced to pay their fair share. The argument is therefore one of class warfare and not economics.

The passage will have no real positive economic impact because the amount raised is trivial compared to the impact on the total debt. There is a potential downside as “the rich” take counter measures that actually exceed the increased payments and total revenues actually decrease as a result.

.......Disclaimer......
what follows is deduced theory and not condoned practice.

The democrats all ready have the long term solution. It is cap and trade. The liberals have dug a hole from which they can’t climb out. They have incrementally given their voters the ability to pay no taxes at all. There is no way they can take back the no tax position. At least 50 % of the population is in that group of nontax payers.

The solution is to provide a tax on the nonpayers that is not a tax and that is paid unknowingly. The payment fuels hate of someone else rather than the corrupt, vote needing, democrat, politician, liars. The solution is Cap And Trade.

The tax is levied on energy producers, all energy producers, that then can raise rates to all consumers. Since the tax is uniform it does not effect rate competition and can by all be passed on with no effect on sales. When passed on it is effectively a trickle down tax. I say energy producers but I think it is mainly electricity. It is a tax on electricity sales covered with a carbon fig leaf described as first aid for man made climate change.

The real and only solution to eliminating the debt is inflation that devalues the amount owed over time. The cap and trade induced rise in energy costs will be hidden within the coming general inflation. That is, the pain and associated hatred will be mitigated somewhat by the general rise in the cost of everything.

The Cap and Trade tax trickle down is coming. That’s what it is, a trickle down consumption tax. Many have tax proposals, VAT, Fair Tax, etc that will cause the 50% of non payers to cough up their fair share. But they are all taxes and new taxes will be strongly resisted by the 50%. An indirect trickle down tax will not be understood when sold as a planet saving necessity.

The beauty is that the value of the tax is compounded. In the coming inflation, the incremental total will be increased compounded by the inflation rate. As all prices, including energy prices are increased the $ value of C&T receipts increases as well.

Since the election, two efforts have begun. The first is to renew the media attention to those insisting on the need to curb climate change. The other is the effort by unions to increase wages. Both are harbingers of inflation. Cap and trade increases costs across the board for all business. In an economy with unemployment wages do not rise. For the needed inflation, labor costs must rise and push general costs up. The wage inflation is being pushed by the unions and will lead to general wage increases in spite of high unemployment.

Then there is the no tax pledge. One must wonder if supporting cap and trade violates the pledge? Charging a fee for carbon emissions is not actually a tax. The fee is like usage fees for visiting a National Park or the ports or perhaps a toll road. For a politician, even a Republican politician, voting for a fee is not voting for a pledge prohibited tax.

[blam]

Now They Tell Us - The economy never really got better

[sickoflibs]

RE :”The democrats all ready have the long term solution. It is cap and trade. The liberals have dug a hole from which they can’t climb out. They have incrementally given their voters the ability to pay no taxes at all. There is no way they can take back the no tax position. At least 50 % of the population is in that group of nontax payers.
The solution is to provide a tax on the nonpayers that is not a tax and that is paid unknowingly. The payment fuels hate of someone else rather than the corrupt, vote needing, democrat, politician, liars. The solution is Cap And Trade.”

That WOULD be the ideal solution for them except that they couldn't get that to O’s desk even in 2009 and 2010 with both houses even when they passed O-care, however if Republicans keep up the way they are going the Dems may have another shot in 2015,

[sickoflibs]

RE :”Then there is the no tax pledge. One must wonder if supporting cap and trade violates the pledge? Charging a fee for carbon emissions is not actually a tax. The fee is like usage fees for visiting a National Park or the ports or perhaps a toll road. For a politician, even a Republican politician, voting for a fee is not voting for a pledge prohibited tax.”

Tax or fee, its hidden to the voters like the value-added tax so they think its the greedy energy companies gouging them.

Our lib governor O Malley played that game and won it with dumb Dem voters here, he ran in 2006 against the evil electric company charging high rates(global energy prices were high then) blaming it on the Republican governor, then got in office and announced that the high price was not really the problem, the problem was really that we were using too much.

And then he and the Dem assembly enacted into law all kinds of hidden taxes on electricity that we have to pay.

Idiot Dem voters in Maryland were too stupid to figure that out, or maybe they like high prices as long as its the government gouging then and not a business. I can believe that,

[Georgia Girl 2]

Thats exactly what I say. Let those 47% who voted BHO back in get a taste of their Dear Leader’s true intentions.

[bert]

———that they couldn’t get that to O’s desk-—

“If at first you don’t succeed, try, try again”

In my view, the trying again is underway

[Drew68]

Any voter’s remorse yet America?

Probably not. They haven't felt the pinch yet. Wait till next year when those paychecks are a little smaller and all those great tax credits disappear (the ones that gave people bigger refund welfare checks than the amount of taxes they actually paid). Then we'll see a wailing and gnashing of teeth!

I am enjoying lurking over at DU and reading posts from liberals complaining about these mean Republicans whose intransigence will force the demise of the BUSH-era tax cuts and a return to the CLINTON-era tax rates.

Sadly, if the Republicans stand on principal, the Democrats are likely to be the ones who will ride to the rescue with tax cuts for the middle class (that look surprisingly similar to those Bush-era tax cuts that everyone except the top 2% will be able to enjoy). They'll get credit for saving the middle class while putting Republicans in the uncomfortable position of either siding with the Dems or opposing a tax cut.

[sickoflibs]

They wont get it through the R house this coming session.

So today lib Chris Hayes was calling on the Obama EPA to use its powers to further regulate carbon emissions CO2 under the Clean Air Act. He was saying again that energy prices are way too low now and that is bad and the EPA should raise them using regulations.

That is his pet issue, climate change.

[bert]

Climate change is the beard, the fig leaf for cap and trade.

Continuing to tell the big lie over and over and over makes it believable.

[gotribe]

They might as well raid half the homes in the U.S.!