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Economics Discuss The Worst Argument The Right Makes About Jobs at the Political Forums; The Right has a handful of things they say are keeping the economy from picking up. The main argument is ...

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Old 10-18-2011, 05:52 PM
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Default The Worst Argument The Right Makes About Jobs

The Right has a handful of things they say are keeping the economy from picking up.

The main argument is that the Job creators are unsure about taxes and until they are more certain they are unwilling to invest.

First thing I would ask is who told them that was the issue? If you are in business and you see the possibility to make some money why would a few percentage points keep you from making these investments.

Taxes are already lower then they have been in decades. The worst case scenerio is they might pay 5% more then they do now.

Can Anyone with a straight face say this is really a factual reason for the lack of spending by these creators.

If I can make $50,000 dollars next month am I really going to ignore that income because my tax might be 5% higher then it is now?

Does this mean that they will never invest again until we promise that tax rates will stay frozen?

As a businessman I will make everything I can every month I can. I won't stop doing business waiting for a historically low rate.

This is a stupid argument that has no base in reality and it's about time someone pointed it out.
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Old 10-18-2011, 06:23 PM
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Default Re: The Worst Argument The Right Makes About Jobs

They have this notion well in place I see. I am waiting for the Debates to start and they are interviewing a Tea Party member. When asked what she is looking for in a candidate she says. "Someone who can create the conditions that will help the job creators to feel confident enough to start investing" She doesn't even question the whole idea that corperations might not be investing because there is no demand. It's all about cutting taxes even lower. Who gets them believing these things?
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Old 10-18-2011, 07:59 PM
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Default Re: The Worst Argument The Right Makes About Jobs

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Originally Posted by Mikeyy View Post
The Right has a handful of things they say are keeping the economy from picking up.

The main argument is that the Job creators are unsure about taxes and until they are more certain they are unwilling to invest.

First thing I would ask is who told them that was the issue? If you are in business and you see the possibility to make some money why would a few percentage points keep you from making these investments.

Taxes are already lower then they have been in decades. The worst case scenerio is they might pay 5% more then they do now.

Can Anyone with a straight face say this is really a factual reason for the lack of spending by these creators.

If I can make $50,000 dollars next month am I really going to ignore that income because my tax might be 5% higher then it is now?

Does this mean that they will never invest again until we promise that tax rates will stay frozen?

As a businessman I will make everything I can every month I can. I won't stop doing business waiting for a historically low rate.

This is a stupid argument that has no base in reality and it's about time someone pointed it out.
I wonder many times as to why the right would say something so ridiculously stupid. It's either they think this is a country of fools (like the "bagger nation"), or they just don't care if they say something true or not.

These job creators are really job killers. This lame rap the right re-gurgitates about job creators being uncertain is a bunch of BS garbage! Returning tax rates back to what they were in the early '80's, does not inhibit job creation, for anyone who can remember what the economy was during that time. And since they are sitting on almost $6 trillion in profits, that dumbass "uncertain" claim, doesn't hold water.

Let's face it, the right are America haters!
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Old 10-19-2011, 10:20 AM
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Post Re: The Worst Argument The Right Makes About Jobs

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Originally Posted by Mikeyy View Post
Can Anyone with a straight face say this is really a factual reason for the lack of spending by these creators.

If I can make $50,000 dollars next month am I really going to ignore that income because my tax might be 5% higher then it is now?

Does this mean that they will never invest again until we promise that tax rates will stay frozen?

As a businessman I will make everything I can every month I can. I won't stop doing business waiting for a historically low rate.

This is a stupid argument that has no base in reality and it's about time someone pointed it out.
That about sums it up.

I have come to the conclusion that some arguments on the right are not intended to carry enough weight to persuade a neutral person.
Instead, they're just meant to provide the initial talking point response so an argument will be responded to. A mantra mindlessly repeated.

As you describe, there is no business sense in this argument from the right.
And I think a lot of them know it, even if they won't admit it.
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Old 10-19-2011, 11:37 AM
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Default Re: The Worst Argument The Right Makes About Jobs

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That about sums it up.

I have come to the conclusion that some arguments on the right are not intended to carry enough weight to persuade a neutral person.
Instead, they're just meant to provide the initial talking point response so an argument will be responded to. A mantra mindlessly repeated.

As you describe, there is no business sense in this argument from the right.
And I think a lot of them know it, even if they won't admit it.
There is the possibility, that on one level (albeit a very low level), it makes sense when you consider their responses are designed to "muddy up" the waters of communication so much, that anything positive that may come out as a result of a particular conversation (on an important issue), is impossible achieve.

Basically, the goal of their responses is to derail the conversation so nothing gets accomplished. Kind of like what they do in Congress; completely gridlock government so nothing gets done.
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Old 10-19-2011, 11:46 AM
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Default Re: The Worst Argument The Right Makes About Jobs

It's a lot more complex than what you guys are making it out to be. Higher tax rates lead to higher rates of tax shielded investment to shield the profits from those tax rates; investments such as tax shielded foreign currency index funds, construction bonds, government bonds, etc. Rather than funneling money back into the business infrastructure in the form of expansion (and thus, jobs), there is a higher incentive to shield profits from taxes.

Look at a 5% tax increase on a one billion dollar business. That's 5 million dollars. 5 million dollars is 1250 $40K per year jobs that could be created if it wasn't being taken away by the government. That's 1250 people now consuming at $40K a year...1250 people purchasing food, clothing, housing, fuel, cars, electronics, etc. 1250 creating a demand for goods and services.

If the tax rate is just going to take that $5 Million plus 5% of anything that the business creates by putting that $5 Million in the infrastructure of the business, it makes more sense from an accounting standpoint to shelter the 5million in a capital investment for several years and hope that some sensible administration comes along that doesn't want to tax you as high. And capital investments can hold out for a long, long time waiting.
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Old 10-19-2011, 11:52 AM
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Default Re: The Worst Argument The Right Makes About Jobs

The problem with this argument is that me as a businessman could care less about how many people I can hire with that extra 5%. My goal is to make money. Why would I forgo profits becuase of a increased tax. The taxes were much higher before and I made money. The goal of business is to aquire money. No business person is going to sit out over a percentage like this. Especially when your taxes are lower then ever now.
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It's a lot more complex than what you guys are making it out to be. Higher tax rates lead to higher rates of tax shielded investment to shield the profits from those tax rates; investments such as tax shielded foreign currency index funds, construction bonds, government bonds, etc. Rather than funneling money back into the business infrastructure in the form of expansion (and thus, jobs), there is a higher incentive to shield profits from taxes.

Look at a 5% tax increase on a one billion dollar business. That's 5 million dollars. 5 million dollars is 1250 $40K per year jobs that could be created if it wasn't being taken away by the government. That's 1250 people now consuming at $40K a year...1250 people purchasing food, clothing, housing, fuel, cars, electronics, etc. 1250 creating a demand for goods and services.

If the tax rate is just going to take that $5 Million plus 5% of anything that the business creates by putting that $5 Million in the infrastructure of the business, it makes more sense from an accounting standpoint to shelter the 5million in a capital investment for several years and hope that some sensible administration comes along that doesn't want to tax you as high. And capital investments can hold out for a long, long time waiting.
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Old 10-19-2011, 12:02 PM
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Default Re: The Worst Argument The Right Makes About Jobs

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Originally Posted by Mikeyy View Post
The problem with this argument is that me as a businessman could care less about how many people I can hire with that extra 5%. My goal is to make money. Why would I forgo profits becuase of a increased tax. The taxes were much higher before and I made money. The goal of business is to aquire money. No business person is going to sit out over a percentage like this. Especially when your taxes are lower then ever now.
You aren't forgoing profits by sheltering the 5% in tax shielded capital investments. You stand to make a good deal more profit by shielding $5M for 20 years at 3-8% interest than paying 5% interest on it and any profits made from reinvesting it in the infrastructure. Further, any investment in the infrastructure of the business may or may not make a profit so a solid 3% return on $5M is a much better risk than possibly no profit and a 5% tax increase.

It's all about risk.
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Old 10-19-2011, 12:15 PM
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Default Re: The Worst Argument The Right Makes About Jobs

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You aren't forgoing profits by sheltering the 5% in tax shielded capital investments. You stand to make a good deal more profit by shielding $5M for 20 years at 3-8% interest than paying 5% interest on it and any profits made from reinvesting it in the infrastructure. Further, any investment in the infrastructure of the business may or may not make a profit so a solid 3% return on $5M is a much better risk than possibly no profit and a 5% tax increase.

It's all about risk.
Now you are difining their expeditures to fit your analysis. The argument the right makes is that the money isn't flowing because there is fear of a tax increase. Did this companies make profits when those rates were higher? Yes. If your spending and investments won't make more then 5% you shouldn't be in business. And if Margins are that close then a zero tax isn't going to help. I can't even believe we are having this debate. The tax is a tax on profit. If you have no profit you have no tax. If you have a profiut the tax is a percentage of the profit. First comes the profit.
The tax rate is a BS argument anyone in business will tell you that.
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Old 10-19-2011, 12:26 PM
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Default Re: The Worst Argument The Right Makes About Jobs

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Now you are difining their expeditures to fit your analysis.
No, I am analyzing where the incentives are.

Quote:
The argument the right makes is that the money isn't flowing because there is fear of a tax increase.
Exactly. Sheltering the profits from the taxes creates a better return in the long run.

Quote:
Did this companies make profits when those rates were higher? Yes. If your spending and investments won't make more then 5% you shouldn't be in business. And if Margins are that close then a zero tax isn't going to help. I can't even believe we are having this debate. The tax is a tax on profit. If you have no profit you have no tax. If you have a profiut the tax is a percentage of the profit. First comes the profit.
The tax rate is a BS argument anyone in business will tell you that.
You fail to understand how publically traded companies work and their obligation to keep increasing the valuation of their stocks.

There's a reason you can't believe we are having this debate: you don't understand what you are debating.
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