I have heard J say this so many times of late that I moved his comment to the front page.
"OK, since I'm always being challenged, I went to the IRS website and found the following actual numbers for 2009:
- Total income taxes paid: $866 billion
- Total paid by top 1%: $318 billion
- Average tax rate of 1%: 24%
- Share paid by 1%: 36.73%
- Share of income of the 1%: 16.9%
Conclusion: The 1% are paying TWICE what is "fair" and then some!
Now, let's say Obama succeeds in raising taxes on the rich (as he seems to be building his campaign around that idea) by 10% (his actual proposal). Let us further assume that the people smart enough to make these incomes (>384K/yr) are too dumb to figure out ways around this tax. They will then pay $350B, and total revenues increase to $897B. Total deficit reduction (unless Congress spends it) is... $31B against a deficit of 1200 B, or 2.5%!! Whoopee!! Practically a balanced budget, right?
Now, can we please talk about the REAL problem-- government spending that makes a drunken sailor look miserly?" J. Ewing
Now my questions are: What should we cut to reduce the budget by $1,000,000,000,000 in 2013? Here is link to reference.
US Federal Budget
And what do you think of J's facts?
15 comments:
Some light reading to give you ideas.
Fiscal Commission Report 2010
Fiscal Commission Site
G2A Cuts and Taxes
Not sure if this was J's source? I didn't find anything at the IRS.
CBO Dist of 2009 Income and Taxes, Pub July 2012
It is hot off the presses and Pg 24 has a table.
I think facts are facts, and it doesn't really matter where you find them.
As for cuts, it's easy. Just cut out everything that Obama added, for starters. Cancel Obamacare. Hand Medicaid out as block grants to the states at the 2008 level. Reduce eligibility for food stamps. Start Social Security privatization now, with people under age 25, figure out the transition for those older so that the math works. Put SS "on budget" since that's where it belongs and end the fiction of the trust fund. Establish Medicare as a premium support system for those under age 55. Means test it if you want, but make it voluntary. Make the premium support program available to CURRENT Medicare recipients as an option. Eliminate most of the Department of Education and return all college loans to private lenders. Eliminate most of the EPA, that part of the Energy Department funding alternative energy (sparing the research funding), some portions of the Commerce Department. HUD could be eliminated. The vast bureaucracies at HHS, Interior, Defense and Agriculture could be cut, with waste and redundancy eliminated. The TSA and Labor Department need to be reined in and probably trimmed back. Homeland Security needs to be refocused on illegal immigrants and terrorists, not grannie. That's a start.
J. Ewing
How much are you thinking from each area?
Does that add up to anything near $1 trillion?
I think Obamacare comes with new taxes to cover some of it's cost.
Obamacare comes with a LOT of taxes that don't begin to cover the costs. That alone saves almost a trillion. The rest of those cuts add up to at least 1/2 trillion. DOE and EPA are about $125 billion (I think) Medicaid would be more than that. All of the others easily add up to enough to essentially erase the deficit over the course of the ten-year budget window. In short, the Ryan budget doesn't cut nearly far or fast enough to suit me. I still prefer the idea of simply voting against the next debt ceiling increase in January. Deficit reduction: DONE! We pay those guys big bucks to come up with a budget; let them earn it.
J.
One more crazy idea, maybe one of your readers has the expertise to answer. What happens if the government simply repudiates that part of the debt held on the ledgers of the Federal Reserve?
J.
Ryan Budget Detail
I am not sure your numbers add up without some huge systemic changes. And more importantly I am pretty sure that most of the cuts will come back to us in the form of higher state taxes. This wouldn't be a bad thing since that is where I feel they belong.
Apparently the budget is only ~$3.8 Trillion, so a $1 Trillion reduction is HUGE.
First of all, $1 trillion isn't very much-- out of a 3.8 trillion budget-- when you consider that the last pre-Obama budget was about 2.4 trillion. Just don't spend on all that Obama stuff and you're there!
But you are also correct that the list of changes I proposed include are some that are very large and "systemic," with savings accordingly. They should be, since the federal government is wasting vast sums of money doing things inefficiently, many of which it shouldn't be doing at all.
Turning Medicaid back to the states, though, includes block grants, so state taxes shouldn't go up unless states choose to add "deluxe" to their medicaid plans. Theoretically and practically, states will find less expensive and more efficient ways to provide this care and thus the whole system saves money.
J.
It seems your $2.4 trillion is incorrect. Fact Check Obama's Spending Inferno
Unless you have a more complete source.
Interesting and Related
Peak Prosperity CPI & Spending
Forbes Spend, Revenues & GDP
MPP Economy
And these folks are apparently horrified at cutting only $110 billion... Nothing compared to the $1 TRILLION gap. What are we missing here?
CNN Spending Cuts
FOX News Spending Cuts
I don't trust Factcheck to check facts at all; it's mostly Democrat spin. Forbes, though, has it right. You can't blame Obama for all of the spending increase in his first year in office. And you can't blame him for the loss of revenue that made the deficit 5 times what it was under Bush. But every year these outrageous trillion-$ deficits continue is entirely Obama's fault, to the extent we blame Presidents for the economy which unfortunately we do.
J.
Both Fox and CNN are reporting what this lying, cheating, deceptive spinmeister administration is peddling. The notion that national defense and border security are the lowest priority items in the federal budget and therefore the first to be cut, you must be a liberal.
The problem with such an outlook is that there are no priorities, and therefore every single program must be funded to as high a level as possible. Congress SHOULD be setting priorities for spending and, when we reach that point where the money runs out, everything below that point on the priority list gets cut. Of course, this system suffers greatly from the fact that nobody wants to do it, and that it makes eminent good sense to do so.
J.
I agree that priorities seem to be lacking. Though I definitely think the Military can be cut. I am really tired of paying for the earth's police force. Even if it may help trade and American interests.
What do having ~119,000 soldiers located in S Korea, Japan and Germany alone have to do with keeping our borders safe? Come on now, this is about Imperialism... Wiki American Imperialism
Wiki Military Deployments
Pareto's law says that when tackling a problem, that you tackle the 80% factors first, since the savings are greatest. Defense is only 20% of the budget so if you are looking for cuts, the rest of the budget has more "low hanging fruit." I also claim that national defense is the first duty of the federal government and therefore should be the last to be cut back.
Now I'm a hawk, but a CHEAP hawk. After the other 80% are pared back to sensible levels, we can look for waste in the defense budget. I know there is some in the procurement section. Cut the others to sensible levels, though, and you wouldn't need defense cuts to balance the budget.
J.
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