Sponsors

Tax Plan Creates Whole New Freeloader Class Email Print

By SusanG
11/10/2005 04:00:56 PM EST

NEW YORK (CNN/Money)- The president's tax-reform advisory panel submitted two final proposals Tuesday morning to the Treasury Department, both of which offer significant changes to the tax breaks people have come to expect ....

In the panel's first proposal, focused on simplifying the tax code, dividends from domestic earnings would be tax-free ....

So let me get this straight. If I inherit enough Exxon stock to live off the dividends, I will pay no federal taxes.

But if I actually roll my ass out of bed every morning to show up to drive a school bus or teach America's children or patrol America's streets or ring up groceries or wait on tables, my work-my-ass-off, earned income is taxed?

Why aren't Democrats ALL over this?

Forget the other complicated parts (at least to me) of the tax panel's recommendations - the AMT, sliding scale, regional adjustments to home mortgage deductions, etc. Just forget it for a moment and keep it simple:

Those who are idle will not be taxed. Those who WORK for a living will be.

This is insane. This GOP-proposed plan penalizes those who produce the goods and services that keep this country functioning, and rewards those who do nothing.

What happened to our proverbial worth ethic?

Why should someone who produces nothing and pays no taxes get the benefit of being protected by the world's largest military? Or driving on the interstate highway system? Or hiking in a national park?

For heaven's sake, cut some commercials, STAT. Show one guy in bed, 10 AM. Show one guy doing construction work. Run a line across the bottom: While Joe Rich sleeps, Joe Worker pays his - and Joe Rich's - tax bill.

Cripes. Keep it simple, Dems. Take a page from the GOP playbook and hammer one simple point home ad nauseum:

Those who don't work shouldn't get a free ride.


KEYWORDS: , ,

Sign up for a Complimentary Member Account... Join the community! It's fast. And it'll allow you to take advantage of all this site's great features!

Related Articles

Disclaimer: "Related Articles" are provided as a service to our readers (Via Google News Feeds created using this article's 'Keywords' as the search terms to generate the feed). It is important to note that if a "Related Articles" list is included with this story, the list will be updated frequently subsequent to the posting of this story and may thus contain articles with information not yet known at the time of this story's original publication.

< When No News Is Good News | Murray Waas: Fitz Holding Out For Libby's Testimony >
 Display:
Tax Plan Creates Whole New Freeloader Class | 15 comments (15 topical, editorial, 0 hidden)
I actually wasted time ... (none / 0)
...figuring out that if your grandfather purchased 230 shares of Exxon in 1950 (Standard Oil then) and left it alone all these years and you inherited it, you'd have a tax-free income slightly in excess of $50,000 now because of stock splits.

Go figure.

by SusanG on 11/10/2005 04:06:26 PM EST

Where the hell was my Grandfather? (none / 1)
if your grandfather purchased 230 shares of Exxon in 1950 (Standard Oil then)

Not to pick nits, I think Standard oil is now Chevron/Texaco because my Mother-In-Law inherited some of that stock...although that might have been Standard Oil of California...

I could be wrong.  

I owned stock once. My wife gave me some Preferred Stock cologne once a while back.

The Albany Project. The best damned blog about New York State politics.

by NYBri on 11/10/2005 07:33:56 PM EST

[ Parent ]
Exxon = Standard Oil of NJ (none / 0)
My ... uh ... father bought it in a year that shall remain nameless.

by SusanG on 11/10/2005 07:51:55 PM EST

[ Parent ]
Cuts on Capital Gains as well (none / 0)
Two sentences down

The net effect is that your capital gains would be taxed at rates between 3.75 percent and 8.25 percent, depending on your tax bracket.

So the investment class would be paying minimal taxes even on capital gains, percentages significantly lower than even the lowest tax bracket (10%).

I'm going to have to resist the urge to slap the next conservobot who talks about liberals/Democrats engaging in class warfare.  Apparently, from the wingnut perspective, income redistribution is only bad when it favors the have nots.  (Not that this is anything new, but this proposal sure does confirm it yet again, does it not?)

-- Stu

by sdf on 11/10/2005 05:22:51 PM EST

Yeah, I realized the capital gains ... (none / 0)
thingy too, but I didn't want to get the issue too complicated. JUST focused on the unfairness of taxing income you have to work for as opposed to that which drops into your lap through inhertance.

by SusanG on 11/10/2005 05:28:26 PM EST

[ Parent ]
IN the interest of not complicating things (none / 0)
Lets not even think about the proposal to eliminate the estate tax.

And by God do not even speculate on the possibility that once they eliminate all taxes on capital gains, dividends and estates all executive compensation will be reconfigured so that all CEO's get Steve Job's Apple pay package: $1 a year. Oh yeah with a certain offset in stock grants and options.

Once you exempt gains on capital assets from taxation you open the door for the rich to simply avoid any taxes whatsover. All they need is a competent accountant and a mediocre tax attorney.

Social Security: Don't Get Played - Flash by Rock the Vote

by Bruce Webb on 11/11/2005 10:40:55 AM EST

[ Parent ]
I'm not saying NEVER concentrate ... (none / 0)
on other aspects.

I'm saying ... take one at a time. Take this one. A month or so from now, focus on the estate tax. Then on capital gains, etc.

To throw a whole lot of tax-related issues out there at the front-end of an argument is overwhelming to understand and difficult. If you break it down and address one issue at a time, I think you have a better chance down the road to tie it all together as a concluding argument, after the individual inequities of these policies are discussed.

by SusanG on 11/11/2005 11:08:04 AM EST

[ Parent ]
It's a package deal (none / 0)
They just want to sell it in parts. They have one argument for exempting taxes on dividends which has a certain plausibility. They have another argument for limiting or eliminating taxes from capital gains which has a certain plausibility. In turn they have a quite different argument for flat taxes and still another for ending estate taxes. Each individually is arguable but if they win on all four it adds up to rich people paying no taxes at all.

They have a long-term strategy with a clear outcome of total victory on the tax front. A narrow focus on the tactics of a single battle don't serve us well here.

So I have to disagree. Put the entire package together and ask America is that what we really want? If we gave Bush and the Right everything they were asking for all at the same time what would be the end result? Anyone making less than six figures will be appalled.

Social Security: Don't Get Played - Flash by Rock the Vote

by Bruce Webb on 11/11/2005 12:13:07 PM EST

[ Parent ]
Good point. (none / 0)
KISS.

Keep it Simple Steps.

One outrage on top of another, and another, and another, most Americans don't even want to know that much.

But this is one they can all grab onto and not let go.

The estate tax is the "icing" on this conserative pastry shelf and also offensive and outrageous. But with the agenda now so openly exposed and the corruption out there for the average worker and tax-payer to see, this should get good traction.

Taxes shall be levied according to ability to pay. That is the only American principle. FDR

by btyarbro on 11/11/2005 12:16:50 PM EST

[ Parent ]
Work Ethic (none / 0)
Perhaps it is almost too obvious to point out that the devaluing of the work ethic and the rewarding of those who profit from unearned income directly mirrors the values and experience of the White House's chief inhabitant, who has never "earned" a dime of income in his life.

-- Stu

by sdf on 11/10/2005 05:25:26 PM EST

It SHOULD be pointed out (none / 0)
Repeatedly.

And this really infuriates me, the whole insult of it. Not only does the working class have to ... you know ... work to get their money, they have to pay the federal taxes that the investment class does not.

It IS a slap in the face of everyone in this country who maintains any kind of work ethic at all. And I think the key IS, in fact, in tying it directly to Bush's personal life experience. Of course, he's for no-taxes-on-unearned income. He's never earned a dime in his life.

by SusanG on 11/10/2005 05:31:44 PM EST

[ Parent ]
There's a old conservative saw (none / 0)
"Don't work for your money; let your money work for you."

Nice idea, if you've got equal access to some and don't have to fight monopolies.

Taxes shall be levied according to ability to pay. That is the only American principle. FDR

by btyarbro on 11/11/2005 12:19:16 PM EST

[ Parent ]
Right. (none / 0)
Good question.

This has been out there long enough for the Democrats to have already launched a counter and for there to be blow-back from the "reform".

People still don't catch on fast enough. Anytime Republicans employ the word "reform," they usually mean theft.

Taxes shall be levied according to ability to pay. That is the only American principle. FDR

by btyarbro on 11/10/2005 06:39:18 PM EST

Who is valued? (none / 0)
The whole point of this is that investments are valued over work.  Because any activity of the rich is valued above the acts of the average person.

The Republicans can dance about how this "encourages investment," but when you have 9/10 of the country scraping by with their only investments being in already protected 401K accounts (and those only because company pension plans have been removed, or have defaulted), what this really does is reward the rich at the expense of everyone else.

For the average investor, this does nothing.  Any possible rewards are still years in the future when those 401K funds are withdrawn.  But those who are lucky enough to have large amounts of stock outside a protected fund get to benefit immediately.

Just another change to rape and pillage the budget, leaving the country even further in the hole, and helping to assure that the US will have to defauly on its promises just like all those corporations.  

by Devilstower on 11/11/2005 09:03:08 AM EST

Agreed (none / 0)
The value is on investment, not on producing.

This seems the opposite of what everyone at least gives lip service to America representing (pioneers, hard work, sacrifice, etc.).

I guess I'm just frustrated because this seems so blatantly a simple, winning point for Democrats and beyond vague platitudes about "how the rich get richer," Dems do very little with this.

I think they need to start taking ONE point -- like this one -- and making it clear that this is what the GOP stands for. This is a very practical, small point that anyone can grasp: If you inherit investment income, you will no longer have to pay your way in this country. The working people will.

But of course, you're right. Investment is honored over work. But the sad fact is, original investment income DID come at some point from providing either a service or good necessary for this country. The shift toward people aspiring to live off investment income instead of actually producing something of quality is the death of our economy as well in the long run.

by SusanG on 11/11/2005 09:42:11 AM EST

[ Parent ]
Tax Plan Creates Whole New Freeloader Class | 15 comments (15 topical, 0 editorial, 0 hidden)
 Display: