Thread: Dems Push $1 Trillion Tax Increase in 2013

Democrats say they want to raise as much as $1 trillion in new revenues through tax reform later this year to balance Republican demands to slash mandatory spending.

The emerging consensus, however, is that the next installment of deficit reduction should reach $2 trillion and about half of it should come from higher taxes.

Liberal and centrist Democrats say revenues collected through tax reform should go to deficit reduction.

“We’ve done about $2 trillion. I thought $4 trillion is the goal we should reach. I think we’re about half way there. We need another $2 trillion,” said Sen. Ben Cardin (D-Md.), a member of the Senate Finance Committee, which has jurisdiction over tax reform.

He said the $917 billion cut under the Budget Control Act passed in the summer of 2011 combined with $620 billion in revenues from Tuesday’s tax deal and interest savings adds up to about $2 trillion.

Cardin said the ratio of spending cuts to higher tax revenues “should be about even” in the next deficit-reduction deal passed by Congress.

I hope they have the good sense to take dividends and capital gains off the table.

Originally Posted by Stew

I hope they have the good sense to take dividends and capital gains off the table.

Why, is it not income? Alas, don't worry - they won't. Instead 'these' people will just get more of the same:

CURL: Obama supporters shocked, angry at new tax increases - Washington Times

“What happened that my Social Security withholding’s in my paycheck just went up?” a poster wrote on the liberal site DemocraticUnderground.com. “My paycheck just went down by an amount that I don’t feel comfortable with. I guarantee this decrease is gonna’ hurt me more than the increase in income taxes will hurt those making over 400 grand. What happened?”

“I know to expect between $93 and $94 less in my paycheck on the 15th,” wrote the ironically named “RomneyLies.”

“My boyfriend has had a lot of expenses and is feeling squeezed right now, and having his paycheck shrink really didn’t help,” wrote “DemocratToTheEnd.”

“BlueIndyBlue” added: “Many of my friends didn’t realize it, either. Our payroll department didn’t do a good job of explaining the coming changes.”

I'm not saying it won't take taxes and spending slashing but why do we need to "balance" slashing spending with taxes? Just because it is "fair?" Last I checked, it wasn't about being ideologically balanced - it was about getting this horrible deficit under control. Raising taxes on one thing to raise money doesn't have a thing to do with slashing a program, elsewhere, to do the same. We aren't cutting out pie slices, here.

I love how they take the cuts passed in 2011 and count them as deficit reduction here in 2013. How many time do we get count the 2011 cuts (which weren't even cuts - just reductions in growth)? Hell, why stop at 2011? Back in 1832 Congress cut spending, let's count that as well.

Originally Posted by Just the facts

Why, is it not income? Alas, don't worry - they won't. Instead 'these' people will just get more of the same:

CURL: Obama supporters shocked, angry at new tax increases - Washington Times

What's funny, is I had a staunch Republican bitch about more "taxes" coming out of his check. He was slamming the President. I reminded him that the reason he ever had that extra in his check was due to the "payroll tax holiday" originally proposed by the President. Fun watching the wheels turn in deciding how to reply. Final comment before walking away was, "it's all bull sh** anyway..."

For the record, I think the Payroll tax holiday was stupid, but as I slowly become a disciple of your views, I am beginning to think it really doesn't matter!!!

Originally Posted by kelroy55

Democrats say they want to raise as much as $1 trillion in new revenues through tax reform later this year to balance Republican demands to slash mandatory spending.

The emerging consensus, however, is that the next installment of deficit reduction should reach $2 trillion and about half of it should come from higher taxes.

Liberal and centrist Democrats say revenues collected through tax reform should go to deficit reduction.

“We’ve done about $2 trillion. I thought $4 trillion is the goal we should reach. I think we’re about half way there. We need another $2 trillion,” said Sen. Ben Cardin (D-Md.), a member of the Senate Finance Committee, which has jurisdiction over tax reform.

He said the $917 billion cut under the Budget Control Act passed in the summer of 2011 combined with $620 billion in revenues from Tuesday’s tax deal and interest savings adds up to about $2 trillion.

Cardin said the ratio of spending cuts to higher tax revenues “should be about even” in the next deficit-reduction deal passed by Congress.

More from that article...

But Democrats in Congress are not yet unified on the issue. Sen. Tim Kaine, a Democrat who won his first term in November’s election, said the spending cut-to-tax increase ratio should be higher.

“Obviously, that second half of the fiscal cliff is the tough spending decisions,” he said. “During the course of the campaign I often talked about 2-1 as a total. That would count all the spending reductions that have already been agreed to.”“I think if you’re looking at a 70-30 ratio, somewhere in between 2 to 1 and 3 to 1, I think that’s a reasonable position,” said newly elected Sen. Chris Murphy (D) of Connecticut, who noted he is from a “fiscally responsible” state.

So once again - how far back into the past are we going to double and triple count spending cuts? Sure we can make progress if we go back and re-count 2011, but we could make even more progress if we go back to 1982. Counting historic spending cuts that didn't even happen - priceless.

BTW - what spending cuts are they even talking about from 2011?

From 2011:

http://townhall.com/tipsheet/guybens..._spending_cuts

While Republicans remain united behind their modest $61 Billion 2011 budget cut package (now $57 Billion, following last week's $4 Billion slash), several vulnerable Democrats are going wobbly. Senate Majority Whip Dick Durbin insisted on Fox News Sunday that his party's proposed $6.5 Billion in additional cuts (which the CBO says is actually closer to $4.7 Billion) constitutes "the limit" of what Democrats would deem acceptable:

To be honest, the budget stuff is spinning out of control even faster than I thought it would. We are counting phantom cuts that didn't even happen - twice. It is laughable. Whomever is keeping the books in Washington must be saying to themselves - "what the hell is going on here."

We can't tax our way out of this crisis without killing the economy. A 1-to-1 cuts-to-taxes ratio won't fix the problem. The gimmicks need to stop, including spreading the "savings" over 10 years to make the numbers look much bigger than they are. If you or I were to operate our own household the way the government tends its own affairs, we would all be on the streets.

Originally Posted by Of Sound Mind

We can't tax our way out of this crisis without killing the economy. A 1-to-1 cuts-to-taxes ratio won't fix the problem. The gimmicks need to stop, including spreading the "savings" over 10 years to make the numbers look much bigger than they are. If you or I were to operate our own household the way the government tends its own affairs, we would all be on the streets.

You and I don't have the power to monetize debt.

Originally Posted by Stew

You and I don't have the power to monetize debt.

Neither does the US government. The US government doesn't have the ability to create money from nothing. Only the Federal Reserve can do that (and they are with QE1, QE2, Opertaion Twist, QE3, and QE4). But of course, they can't do that forever because it will cause hyper-inflation. If the US government could monetize debt why do we have a debt?

Of Sound Mind - I don't think people fully appreciate the size of the problem. The reality is we can't tax our way out, cut our way out, or do any combination of both. It doesn't leave a lot options. I have to question why we are even trying anyhow. Why should we increase taxes or cut spending? Right now I see no reason to do either one. In fact, what would be wrong with cutting taxes even more AND increasing spending?

I say cut taxes to $0 and increase spending to what ever level we think we need.

Originally Posted by Just the facts

The reality is we can't tax our way out, cut our way out, or do any combination of both. It doesn't leave a lot options.

We have to at least get to the point of zero-deficit yearly spending — however that has to happen. We may never be able to pay down the debt; but at some point, we have to stop adding to it. ANY proper solution is going to result in LOTS of pain. At the very least, though, we have to stop digging deeper.

Originally Posted by Stew

I hope they have the good sense to take dividends and capital gains off the table.

I want corporate income taxes taken off, or at least 50% slashed. That would help the middle class as well as the economy.

Of Sound Mind - I used to think like you, but now I am wondering if I had been wrong all those years.

Why do we have to stop adding to the debt? I'll be honest, I am not seeing why we have to stop. Are the people loaning us the money to deficit spend going to stop loaning it to us? They haven't stopped yet. In fact, they are lining up to loan us more. Plus, we have the lender of last resport - the Federal Reserve. Are they ever going to say No? Answer, nope.

Originally Posted by Just the facts

Of Sound Mind - I used to think like you, but now I am wondering if I had been wrong all those years.

Why do we have to stop adding to the debt? I'll be honest, I am not seeing why we have to stop. Are the people loaning us the money to deficit spend going to stop loaning it to us? They haven't stopped yet. In fact, they are lining up to loan us more. Plus, we have the lender of last resport - the Federal Reserve. Are they ever going to say No? Answer, nope.

Simply because more and more people in the population leads to more and more demand for government services with more wear and tear on them. As long as plenty of tax revenues come in to pay interest on the debt, there shouldn't be much of a problem in staying with the financial situation as is.

But we can just borrow the money to pay the interest on the debt. How about making $1 trillion coins like Obama wants to do (bet you haven't heard about that plan).

Originally Posted by Just the facts

Neither does the US government. The US government doesn't have the ability to create money from nothing. Only the Federal Reserve can do that (and they are with QE1, QE2, Opertaion Twist, QE3, and QE4). But of course, they can't do that forever because it will cause hyper-inflation. If the US government could monetize debt why do we have a debt?

That's a good question.

Originally Posted by Just the facts

Of Sound Mind - I don't think people fully appreciate the size of the problem. The reality is we can't tax our way out, cut our way out, or do any combination of both. It doesn't leave a lot options. I have to question why we are even trying anyhow. Why should we increase taxes or cut spending? Right now I see no reason to do either one. In fact, what would be wrong with cutting taxes even more AND increasing spending?

I say cut taxes to $0 and increase spending to what ever level we think we need.

Exactly. We should spend a couple of trillion or more on infrastructure projects such as energy, water, roads, pyramids and whatnots. For as long as the government can convert its debt spending into tangible assets it should do exactly that. That way in 2020 the people will be that much more ahead.

Originally Posted by Stew

Exactly. We should spend a couple of trillion or more on infrastructure projects such as energy, water, roads, pyramids and whatnots. For as long as the government can convert its debt spending into tangible assets it should do exactly that. That way in 2020 the people will be that much more ahead.

Stew - this is exactly what I am thinking. If we are going to go down the drain, let's at least have high speed rail to show for it.

There's a simple solution to all of this.

Originally Posted by Plutonic Panda

There's a simple solution to all of this.

Do share. It can't get any crazier than minting $1 trillion coins.