Don't we all hate to pay taxes?

Question

why do you liberals agree to raise taxes? its unessesary. also, you tax rich people more. they earned their money!

Answer 1

I'm so glad I'm poor and have no money too pay taxes.

LOL

Answer 2

I have no problem at all with paying my fair share! In exchange for some of the lowest taxes in the industrialized world (check it out!) I get to live in the greatest nation on the planet.

As to raising taxes, often it's unavoidable. It's not just a "liberal thing" either. Bush Sr was forced into raising taxes to pay for the First Gulf War among other things and nobody ever accused him of being a liberal!

Once the budget is set, Congress needs to raise the funds to pay for everything. Just like you, they have only 2 ways to do that. Earn it or borrow it. That's it! There's no other way to get the money!

Government "earns" money by levying taxes and fees upon the citizens. Use fees, such as entry fees to National Parks only go so far, however. The rest has to come from taxes.

If the government doesn't want to raise taxes, the ONLY option left is borrowing. That keeps taxes down but there IS a price to pay since borrowing costs money. We don't get interest free loans and neither does the government.

It's one thing to borrow at low rates while the economy is surging ahead since a growing economy generates enough tax revenue to cover the costs. However when the economy flattens out as it has over the past several years the debt from borrowing can rapidly outstrip tax revenues. That's exactly what has happened in the past 6 years or so. While the economy IS growing it's nowhere near the rates that it was during the 1990s. We are now in the situation where the national debt has ballooned to over $7 TRILLION -- the largest in history. In fact, the deficit spending of the past 6 years is greater than all of the prior deficits in the history of the nation COMBINED!

We are now stuck between a rock and a hard place. While deficit growth has slowed in the past 18 months or so, there's NO WAY that it can be allowed to continue. The only choices are massive budget cuts or tax increases. Even if all of the pork is cut from the budget it will only equal a small fraction of what will be needed to balance the national checkbook given the size of the total debt. That leaves tax increases, possibly massive ones, as the only viable option.

It really doesn't matter who wins in 2008, tax increases WILL be needed to clear up the damage of the irresponsible actions of the last 6 years. The only thing that will matter is who gets stuck with the bill. Republican administrations are more likely to lean on the middle class to take up the slack while Democrats are more likely to lean on wealthier taxpayers.

Raising taxes is political suicide for Republicans, far more so that for Democrats. Look at Bush Sr and Bill Clinton. Both raised taxes. Bush Sr got the heave-ho in favor of a charismatic political unknown. Clinton raised taxes and got re-elected by a wide margin. He also did it while growing the economy and REDUCING the deficit. His legacy was the first budgetary SURPLUS in nearly 4 decades, overall a mean trick by anyone's standards.

Stating that raising taxes is unnecessary is a simplistic view of the whole situation. If you have a better way to clear the deficit, I'd LOVE to hear it but sitting there and throwing wisecracks about "liberals raising taxes" isn't going to add a dime in revenue or cut a dime from the budget.

Of course rich folks are taxed more. They can afford to pay more! After all, the first rule of taxation is to make sure that the taxpayer can AFFORD to pay the tax. You don't need a Harvard MBA to figure out that wealthy people can afford to pay more taxes. Joe Six-Pack knows that even without being told. (And old Joe is likely to see a tax cut under a Democratic administration though Bill Gates, Steve Forbes, and Warren Buffett had better watch out.)

"The only thing worse than a Tax & Spend Democrat is a Borrow & Spend Republican. At least with the Democrat you know that the bills are paid. With the Republican you don't even get the bill until he's left the restaurant." (c) 2007 BostonianInMO

Answer 3

I agree with Bostonian's post in large parts. For instance, I agree that taxes will have to be raised AND unnecessary expenditures need to be reduced. To be clear, I am in the top 1% of earners and I am FOR increasing taxes on the rich.

However, I disagree with Clinton's legacy. Clinton's terms as President coincided with a growth period that was largely fueled by the technology industry. Clinton's policies had absolutely nothing to do with it. In fact, his policies and a lack of proper oversight by the SEC and the Fed, probably contributed to the beginning of the meltdown that occurred in mid 2000 and continued through to 2002. Clinton always seems to get the credit for some great economic boom, but the fact is, the crash after the boom also happened during his Presidency. Bush gets blamed for it, but since it began before he even took office, the blame really belongs to Clinton.

Also, Clinton may have had a budgetary surplus, but exactly where did the surplus go? It sure didn't go to reduce the national debt because the national debt actually went UP during those years. Clinton's budgetary surpluses were in 1998, 1999 and 2000. National debt at start of 1998, 5.4 trillion. National debt at end of 2000, 5.7 trillion.

With all of that being said, I wholeheartedly agree that something needs to be done. While we don't have the largest debt as a percentage of GDP in the world, we can't continue on the current path. Eventually, the budget will need to be balanced and the debt reduced. The only sure way to do that is to raise taxes and to cut spending.