The Bishop and the Butterfly: Murder, Politics, and the End of the Jazz Age



    I now endorse…………………….

    Eliminating the cap on social security:  

    All agree this would eradicate any shortfalls for decades.  (Yes, this could equate to as much as 14-15% in additional contributions by the wealthiest, but this could be somewhat alleviated in the future by prudent offsets.)

    Amending the total Medicaid contribution from 1.45% for both employer and employee (2.9%) of earnings to 1.95% each (3.9%) regardless of wages – there is no cap:

    I do believe this is an example of where we all need to pay a share.  It also is an equal distribution – part of offset for social security cap removal which will to a greater degree impact the wealthiest.

    *Already planned (but not implemented) is The Medicare-funding Hospital Insurance Tax, currently at 1.45 percent, will increase by 0.9 percentage point for higher earners, another provision of health reform. The increase will apply only to income that's in excess of $200,000 for single taxpayers and $250,000 for those married and filing jointly.

    Currently, only wages and other labor income are subject to the Medicare tax. But under current law, unless changed, investment income will be subject to Medicare taxes starting next year. Yes, this needs to be implemented.

    Continue the federal unemployment extension benefits:

    In many parts of our country unemployment is still well above current median figure.  Implement a trigger that when the median figure is at 6.5% in state, the extension will cease for that state.

    Allowing the top tier income tax cuts to expire:

    Top tier tax rates will increase to 39.6 percent from 35 percent if the tax cuts expire on Dec. 31. But the end of the tax cuts also means the end of the low rates on investment income. The top rate on long-term capital gains will rise from 15 percent to 20 percent, and the top rate on dividends will rise from 15 percent to 39.6 percent, the same as ordinary income. (NYT -11/17/2012) 

    Maintain primary home mortgage loan interest deductions:

    This is mandatory.  We need to get healthy housing and building investments back. 

    Maintain charitable deductions for most part:

    The wealthiest make the most high end charitable contributions and as we close their loopholes, their donations economists project should only increase, which benefits all of us.

    Implement new employee tax credit:

    For the next two years, each additional hire for new positions (not for hiring to replace those who have retired or otherwise left existing positions within business), after first full year of employment employers will be awarded a tax credit equaling 1.5% of the new employee’s gross wages for up to three years.

    Okay, now for mainly the 1%’s:

    We must end the “carried interest” loophole.  Just like Romney (and many others in like positions) gets to claim that millions of dollars in compensation from his work at Bain Capital as capital gains rather than ordinary income; thus he pays only the extra-low capital gains rate instead of the higher ordinary rate. This is a break available only to the managers of investment partnerships like private equity and hedge fund managers.

    The special low tax rates for investment income are among the largest tax breaks in the code. They allowed investors to pocket some $100 billion in 2012 alone compared with what those investors would have paid if investment income were taxed the same as regular income.

    Of course, most Republicans are tethered to the stance that tax rates must never rise - this particular loophole would be untouched under their plan to broaden the base. In the end, for the sake of raising much-needed revenue efficiently and fairly, there is no substitute for letting all of the high-end tax rates expire, once and for all.  (NYT 11/2012)  I agree.

    Tax credits for businesses for jobs returning here - no credits for sending jobs to other countries.

    Review and amend the current corporate tax structure:

    I do believe this is important. I haven’t acquired enough data, but currently leaning to endorsing a modest reduction.

    I’ll leave it up to the CBO’s number crunchers to deliver the totals needed for final review. 

    Okay, there will be more, and I realize I did not give much detail - but am interested in any additional data and your input.  I’m hoping many will add on and/or advise why what I’m endorsing is not ‘a good thing’.  Please share with us what you believe should and shouldn’t be supported. I'm hoping you will assist me in fine tuning my assessments and build awareness of potential additional 'fiscal cliff' issues.  So, in advance, thanks.

    And of course, hoping this encourages all to send suggestions to the WH website as requested.  (Hey, just because we voted, that’s only the beginning of what we need to do to assist and support this administration; we’ve been asked to communicate so let’s do our part.)


    BOY, Genghis was not kidding.

    This blog is getting harder and harder. ha

    No you still got two blogs going at the same time!

    I am about to give up!

    I am going to wait an hour and see how the blog works in order to answer properly!

    I have my own streaming probs.

    I just point this out because it is excruciating.


    Okay,  this is going to sound like a stupid question, but I'm going to ask it anyway, because I'd really like to know ...

    Why have so many folks settled on the tax rate on the wealthy going up to 39.6 %?   I mean, why not 40%?  Is it just a psychological thing, like pricing a store item at 19.95 instead of 20 dollars?  Or is there a more complicated reason?  If it is just a psychological reason, aren't we a bit far down the road to worry about that kind of window dressing? 


    It's the Bill Clinton top tax rate signed into law in 1993, and it was supposedly carefully calibrated by micro economists and other numbers crunchers not to get into problems of diminishing returns, and counterproductive results, via things like tax evasion, suppression of investment, funds and business flowing out of the country, etc. (Not to mention, by his second term, the fact that they kept it at this rate and didn't go higher left a good chunk of well-to-do people thinking Bill Clinton and Democrats knew how to handle the economy better than the Republicans. Politically, there's a lot of benefit to not waging whole hog class war.) It did end up helping balance the budget and by the end of his second term had miraculously made a big dent in the debt. And that's with expanding things like Earned Income Credit, with many in the lowest income levels basically getting refunds of their SS payments or even beyond that, to negative taxation in certain cases.

    P.S. Everyone should keep in mind that most of the uber-wealthy do not have a lot of earned income. So all much higher income tax rates would do as far as uber-wealthy are concerned is things like signalling corporate boards to lower some CEO salaries and give them more stock options or other benefits

    James Kwak @ The Atlantic, Nov 15:

    If you really want to raise revenues, the Holy Grail isn't capping tax deductions, as Romney proposed, or raising the top marginal rate, as Obama proposed. It's taxing investment income like ordinary income.

    The New York Times did a story for today's print on an evasion effect already happening; it's real and not just with fat cats; it tells of uber-wealthy Steve Wynn's plans, but also that of a chiropractor who is making sure her income for the year does not go over $250K:

    Investors Rush to Beat Threat of Higher Taxes
    By NATHANIEL POPPER and NELSON D. SCHWARTZ, New York Times Business Day, Nov 18/19, 2012

    There's a known depressive effect on economic activity, and from my reading during the Clinton years, I know the percentages of effect with each percentage rise have been studied. The higher you go over that amount, you at very least have to try to make it up with stimulative government spending. (Which doesn't always work out like progressives like: more Defense contracts for more weapons? Good paying jobs, after all!) Spending which counters the whole balancing budget thing and may or may not spur growth, depending on what it is, what it is decided by Congress. (Unless, of course, you are into presuming that Modern Monetary Theory will soon be enacted in running this country's monetary system....)

    aa, curious about what you think - IF we taxed all income (including investment, etc.) the same as 'earnings/wages', would you be adverse to keeping the current rate of the wealthiest and not raising it to 39.6%?

    I have no firm suggestions beyond trying Bill Clinton again first, I'm not so much into that kind of wonkery, it gets too thickedty-wicket for me.

    But I must say I was impressed when I checked up on all of Canada's taxes about a year or so ago, how they are actually way lower than us on many Federal counts like income tax and corporation taxes, and government income comes from other taxes--their tax system would be a good place to get inspiration, not so much to copy, but for inspiration. If I recall correctly (warning: maybe not) they like have a much lower corporate tax rate but far fewer deductions/loopholes/whatever are allowed, so they don't end up with some corps paying zero like we do.

    Thanks AA.   I appreciate your taking the time to explain it to me.  It's nice to know there are careful calibrations being done by micro-economists and number crunchers and that the figure wasn't simply arbitrary.


    the tax amount of $250,000 taxable income for a married couple is $59,407

    Using the 2000 tax rate schedule before the Bush tax cuts it is $73,409, an increase of $13,642 if the Bush tax cuts are allowed to expire.

    Your list is a good start!

    I like this!

    There's more on the proposed taxes on upper incomes being negotiated, in today's NYT:

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