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Can anyone debunk or refute this article thanks ?

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posted on Sep, 22 2011 @ 10:15 AM
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Can anyone debunk or refute this article thanks just this part that says higher taxes will mean that business owners will keep their money inside their business to avoid higher taxes and they will create Jobs ?

Why the Economy Grows Like Crazy Amid High Taxes
The raw truth is that the economy has grown faster when taxes were higher, but how can we explain that phenomenon?

Why do high taxes create a stronger economy?

I used to run a small business -- a commercial film production company.

Every time we took a dollar out as personal income, it instantly turned into 50 cents.

If we didn't really need the money, that was an incentive to keep it in the company and to find ways to spend it that took it out of the taxable profit column but increased the value of the company.

High taxes create an incentive to reinvest profits into long-term growth.

With high taxes, the only way to retain the bulk of the wealth created by a business is by reinvesting it in the business -- in plants, equipment, staff, research and development, new products and all the rest.

www.alternet.org...




posted on Sep, 22 2011 @ 11:03 AM
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My thinking is people don't start a business so they can hire people and support them via benefits and wages, people start a business to make a profit and try to a acheive a standard of living. Bottom line is why would you start a business when profit becomes harder or unacheivable. And secondly what business wants to grow and do more work for little or less reward. I started a business for myself, not so I could support a bunch of people. What I observed is I keep my standard of living regardless of when taxes are high or low. I downsize the business not my lifestyle when taxes are high, and when they are low I grow. Sounds like a biased spin in the article to justify taxes.
This article is funny because it claims people avoid taxes and reinvest capital, yet the left also claim people need to pay there fair share. Now how do people pay their fair share and yet the article also claim its successful because they dont pay their fair share but avoid paying the taxes completly i'm confused. Sounds like spin, sound like having your cake and eating it too.
edit on 22-9-2011 by Snorkelbacon because: (no reason given)



posted on Sep, 22 2011 @ 11:13 AM
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reply to post by Snorkelbacon
 


You downsize when taxes are high?
And that helps your income how exactly?



posted on Sep, 22 2011 @ 12:25 PM
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Originally posted by narwahl
reply to post by Snorkelbacon
 


You downsize when taxes are high?
And that helps your income how exactly?



it's called, not having to match as many taxes for employees= more capital for the company....doesn't sound so hard to understand does it?



posted on Sep, 22 2011 @ 12:32 PM
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reply to post by mikejohnson2006
 


This article assumes that C Corporations (Corporations that are double taxed) will not pay out dividends to avoid double taxes. This is not entirely true.

First, many businesses are not C corporations. They are LLC's and S corporations that are not double taxed. The owners of these businesses will be taxed the same, regardless of whether or not they keep money inside the business.

Second, many C Corporations can use tricks to avoid double taxes and distribute money out of the business to the owners. For example, C corporations can pay the business owners higher salaries.



posted on Sep, 22 2011 @ 12:42 PM
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And I thought economics 101 was dead !!!

The only way a business grows is to "sell" more products and/or services. This often means working more people.

Just because your business makes a lot of product does not mean you make more money.

If this were so buggy whip makers would all be rich. It would not be hard to emass a warehouse full of buggy whips to day. Finding a market for you product or service is the real hard part about business.

More consumers makes for more business.

People with money to spend are more likely to be consumers than theose who are broke.



posted on Sep, 22 2011 @ 12:55 PM
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Originally posted by patternfinder

Originally posted by narwahl
reply to post by Snorkelbacon
 


You downsize when taxes are high?
And that helps your income how exactly?



it's called, not having to match as many taxes for employees= more capital for the company....doesn't sound so hard to understand does it?


I'd expect to get more money out of any employee, than I put in.
As long as that holds true, if I let him/her go I am going to earn less money.
So nope. Doesn't make sense to me.



posted on Sep, 22 2011 @ 01:07 PM
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Anytime our economy was boosted it was under higher taxes. The highest being the 50s and 60s. And again under the Clinton Administration, whose tax rates or economy haven't been seen since.
The highest tax rates are followed by economic boom. Large tax cuts create a temporary boom and a crash. HHHMM seem familiar?



posted on Sep, 22 2011 @ 01:21 PM
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yeah well heres my take

past economies are a moot issue and do not take into consideration of the following elements:

1, manufacturing and industrial base which means real jobs where by americans use to produce and that production led to wealth creation which let to tax revenue for the governemnt.
2. less people living off of govenrment assistence such as social security,medicare and medicaid and other government subsidies.
3. when said people were producing on their own that mean the government have tax revenue.
4, the devaluation of the dollar effects everything we make and buy and sell here and elsewhere in the world.

right now there are ove 100 million people living off the government dime which means they are consuming wealth instead of producing wealth that creates tax revenue and wealth for us all.

raising taxes on business on everyone takes that wealth out of the economy and with the continual progression of the prices of goods and services taking money out the a certain groups pockets tax money out of all of ours.

raising taxes all it does is doing more of the same propping up a failing entity we call government

i cant see how for the life of me people think that they should keep what they earn you worked for it why shouldnt you keep it.

and that tax revenue doesnt go to you when taxes raised its blown and the dont ask they dont beg they take more.

the taxation argument is ridiculous to say the least why give them more money that government is doesnt trickle back down.
edit on 22-9-2011 by neo96 because: (no reason given)



posted on Sep, 22 2011 @ 10:37 PM
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"High marginal tax rates correlate with economic growth."

Does correlation imply causation?

The effect of tax hikes on, say, sales tax alone discourages incentive: quantity supplied of "whatever" will decrease as the result of a decrease in demand because of an artificial increase in price. It's artificial because it's not reflective of equilibrium price that is established by the market, but by government policy. Moreover, a business' revenue will decrease as a decrease in demand follows with the increase in price.

Larry goes on to say that higher taxes provide incentive for businesses to re-invest, but in this sales tax model that's simply not true. Real costs go to buyers and sellers. Sellers probably incur the greatest marginal cost because their business expenses increase. Now they must find an artificial balance between operating at a profit margin that allows them to continue to do business in concert with setting prices customers will not balk at. Beside this, Larry's article presupposes that government is capable of efficiently allocating resources. In this case, redistributing others' money. I mean he makes a correlation, but from my point of view the correlation is tenuous.

I do hear, now and again, certain figures in the political spectrum who claim that higher tax rates are the precursor to "wealth," and that this is the catalyst to business growth. Roads, law enforcement, the judicial system and so on do create conditions that allow for a better marketplace, but they don't create a marketplace to begin with.

If nothing else it was not clear to me from the article "what tax" needs to be increased. Larry seems to be going after the rich, but whatever. What is obvious is that some people "have it in" for the rich, despite that many (but not all) of the rich work just as hard, if not harder, than someone who is not rich. It just so happens that their production value sells. So they're punished because of their talents and/or skill. Potentially, this cream of the crop may one day say "screw it" and find better opportunities in the world where they're not squeezed of their earned prosperity. Are we better off when talent like that decides to leave? I think not. Something like 40% of medical doctors, engineers, and scientists in America are not natural born. That alone is evidence that our system offers solid incentives, and we gain from this. If we decide to damn the rich because of their prosperity and allow government to practice economic equality then we're discouraging current and up-and-coming entrepreneurs and other talent from even coming into our marketplace.



posted on Sep, 22 2011 @ 10:55 PM
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Originally posted by Kovenov
"High marginal tax rates correlate with economic growth."

Does correlation imply causation?


The trend is reliable to indicate so, yes. if not the taxes themselves, then something attendant to the taxation like, oh, I dunno, a more solid safety net liberating more consumers from poverty, thus enabling them to buy more of your stuff. Or maybe better roads, making it possible for you to deliver your product faster and at a lower cost. Stuff like that.


The effect of tax hikes on, say, sales tax alone discourages incentive: quantity supplied of "whatever" will decrease as the result of a decrease in demand because of an artificial increase in price. It's artificial because it's not reflective of equilibrium price that is established by the market, but by government policy. Moreover, a business' revenue will decrease as a decrease in demand follows with the increase in price.


Sales Tax are a "compromise" tax - that is, it's the state needing tax money to function, but still buckling to the anti-tax demands of the Privileged elite. so the tax is collected from these least able to afford it rather than from those most able to. You don't like sales tax? Good, that means you're self-aware, it's a regressive and punitive tax designed solely so your quote unquote "betters" will be free of taxes. The higher corporate and other business taxes, the lower the sales tax - case in point, Oregon, with a high capital gains tax and no slaes tax.


Larry goes on to say that higher taxes provide incentive for businesses to re-invest, but in this sales tax model that's simply not true.


Actually it is. Since it is profits that are getting taxed, reinvesting your money into the business ends up bringing you greater benefit than simply keeping cash as profit. Similar to how the argument that high taxes cause low employment is garbage - ESPECIALLY since employers get a per-employee tax break.


Real costs go to buyers and sellers. Sellers probably incur the greatest marginal cost because their business expenses increase. Now they must find an artificial balance between operating at a profit margin that allows them to continue to do business in concert with setting prices customers will not balk at.


This is a very 1940's way of looking at a business venture. It's so quaint as to be cute.


Beside this, Larry's article presupposes that government is capable of efficiently allocating resources. In this case, redistributing others' money. I mean he makes a correlation, but from my point of view the correlation is tenuous.


Actually it is highly effective, when allowed to operate; it's just that the reactionary allies of the privilged elite do all they can to impede these mechanisms, then claim "it doesn't work!" - see the current state of public schooling, and the causes for its problems.


I do hear, now and again, certain figures in the political spectrum who claim that higher tax rates are the precursor to "wealth," and that this is the catalyst to business growth. Roads, law enforcement, the judicial system and so on do create conditions that allow for a better marketplace, but they don't create a marketplace to begin with.


"The Market" is too often spoken of as though it were some sort of abstract, some religious ideal rather than a fragment of reality. consumers are the market. You and I and everyone else who buys, we're hte market. That which benefits us then benefits the market.


If nothing else it was not clear to me from the article "what tax" needs to be increased. Larry seems to be going after the rich, but whatever. What is obvious is that some people "have it in" for the rich, despite that many (but not all) of the rich work just as hard, if not harder, than someone who is not rich. It just so happens that their production value sells. So they're punished because of their talents and/or skill. Potentially, this cream of the crop may one day say "screw it" and find better opportunities in the world where they're not squeezed of their earned prosperity. Are we better off when talent like that decides to leave? I think not. Something like 40% of medical doctors, engineers, and scientists in America are not natural born. That alone is evidence that our system offers solid incentives, and we gain from this. If we decide to damn the rich because of their prosperity and allow government to practice economic equality then we're discouraging current and up-and-coming entrepreneurs and other talent from even coming into our marketplace.


Even at the highest rates of taxation in this country, the wealthy continued to lead wealthy lives utterly devoid of the worries that the poor of the period had to contend with. The rich claiming taxes are "punishment" is like a child claiming their mom is cruel because she makes them clean their plate at dinner.



posted on Sep, 22 2011 @ 11:09 PM
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reply to post by TheWalkingFox
 


I on the other hand would say buyers and sellers comprise the market. But it's a small point not worth making a talking point. Suffice it to say our viewpoints on the function of the "market" (a not-so-abstract conceptualization) & governmental policies are divergent. Put simply, there's probably very little middle ground to be found between you and I.



posted on Sep, 23 2011 @ 01:07 AM
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reply to post by Kovenov
 


Probably so. Trouble is, we're not talking about personal opinions here, but rather demonstrable facts.

The concept of "the marketplace" hinges on consumers.
Providers are merely an outgrowth of consumption. Supply arises in accordance to demand, demand does not rise according to supply (See the buggy-whip example posted above.)
Advertising exists because of this fact; it's an effort (an expensive effort) by producers to try to create demand among consumers.
As consumers are the driving force of the market, that which benefits them benefits the market, just as a car with a good engine runs better than a car whose engine has been soaked in salt water for a month.
The bulk of consumers are found in the lower and middle classes.

Ergo...?



posted on Sep, 23 2011 @ 01:44 AM
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Originally posted by nixie_nox
Anytime our economy was boosted it was under higher taxes. The highest being the 50s and 60s. And again under the Clinton Administration, whose tax rates or economy haven't been seen since.
The highest tax rates are followed by economic boom. Large tax cuts create a temporary boom and a crash. HHHMM seem familiar?


This is the latest nonsense propaganda the Marxists have been spreading...Sigh the sad part is they are laughing at how many sheep buy this tripe.

Perhaps you could explain to us how the government stealing more of the working capital from businesses and individuals translates to boosting the economy? And while your at please explain how the government stealing less money from businesses and individuals translate to a temporary boom then a crash...

I doubt you can and everyone who advocates this non-sense has no clue in understanding how the business cycle operates. You'd think they'd get a clue when the same people who are running this country into the ground clueless of the business cycle advocate the same non-sense... sigh!



posted on Sep, 23 2011 @ 02:28 AM
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reply to post by mikejohnson2006
 


There was a time when the economy was fairly stable, and this was during the 50's when the wealthy paid their fair share. In the 90's Clinton even raised Taxes at the beginning of his administration, and this didn't cause the apocolypse libertarians and GOPers continue to argue about.

I don't believe though that raising taxes will do much good even in this economy right now, just like I believe that cutting taxes, especially for the wealthy, will do absolutely nothing. The government has a spending problem and it's for a number of reasons. Raising the revenue will just give them more excuse to continue to spend. I think increasing taxes, especially for Corporations and the wealthy who work through loopholes, will be a fundamental part to this nations economic recovery, but it needs to come at the same time for cuts, and I'm talking about cuts and reform, for both the social programmes and the military. I think cutting taxes can be effective, but only during a time when the economy is moderate to booming. This is when folks don't hold or save off their tax savings, they actually spend it to stimulate the economy, because there's no financial crises for them to fear, minimal worry for the prospect of unemployement. I know I'll certainly be spending my tax cuts on goods if it's a good to great economy because I'll have little worry to save my money for an emergency, or for the fear of unemployement.
edit on 23-9-2011 by Southern Guardian because: (no reason given)



posted on Sep, 23 2011 @ 03:23 AM
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Maybe its like the global warming thing...where people said that co2 was causative of a warming trend, and yet others said that the warming trend may actually have been slightly ahead of the rise in co2.
So maybe higher taxes came as a result of politicians with dollar signs in their eyes wanting to get at the wealth being created by business. People looking at that trend later on might think that higher taxes caused the wealth.

Oh yah, by the way, Ben Bernanke apparently announced a new stimulus and the DOW responded today by going down over 400 points. The marketplace knows that a stimulus means that the FED will print money to pay for this, and that devalues the dollar because there is not more gold in the system backing the extra dollars. This causes inflation. So if you thought that food prices have gone up recently, you ain't seen nothin yet...
edit on 23-9-2011 by ThirdEyeofHorus because: (no reason given)



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