Who are the job creators? The 1% or the middle class?
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    Posting Addict Spacers's Avatar
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    Default Who are the job creators? The 1% or the middle class?

    As we go into the final days of a dismal presidential campaign where too many issues have been fudged or eluded -- and the media only want to talk about is who's up and who's down -- the biggest issue on which the candidates have given us the clearest choice is whether the rich should pay more in taxes.

    President Obama says emphatically yes. He proposes ending the Bush tax cut for people earning more than $250,000 a year, and requiring that the richest 1 percent pay no less than a third of their income in taxes, the so-called "Buffett Rule."

    Mitt Romney says emphatically no. He proposes cutting tax rates on the rich by 20 percent, extending the Bush tax cut for the wealthy, and reducing or eliminating taxes on dividends and capital gains.

    Romney says he'll close loopholes and eliminate deductions used by the rich so that their share of total taxes remains the same as it is now, although he refuses to specify what loopholes or deductions. But even if we take him at his word, under no circumstances would he increase the amount of taxes they pay.

    Obama is right.

    America faces a huge budget deficit. And just about everyone who's looked at how to reduce it -- the non-partisan Congressional Budget Office, the bi-partisan Simpson-Bowles Commission, and almost all independent economists and analysts -- have come up with some combination of spending cuts and tax increases.

    The practical question is who pays those increased taxes. If Romney's view prevails and the rich don't pay more, everyone else has to pay more.

    That's nonsensical. The rich are far richer than they used to be, while most of the rest of us are poorer. The latest data show the top 1 percent garnering 93 percent of all the gains from the recovery so far. But median family income is 8 percent lower than it was in 2000, adjusted for inflation.

    The gap has been widening for three decades. Since 1980 the top 1 percent has doubled its share of the nation's total income -- from 10 percent to 20 percent. The share of the top one-tenth of 1 percent has tripled. The share of the top-most one-one hundredth of 1 percent -- 16,000 families -- has quadrupled. The richest 400 Americans now have more wealth than the bottom 150 million of us put together.

    Meanwhile, the tax rates paid by the wealthy have dropped precipitously. Before 1981 the top marginal tax rate was never lower than 70 percent. Under President Dwight Eisenhower it was 93 percent. Even after taking all the deductions and tax credits available to them, the rich paid around 54 percent.

    The top tax rate is now only 35 percent and the tax on capital gains (increases in the value of investments) is only 15 percent. Since so much of what they earn is from capital gains, many of the super-rich, like Mitt Romney himself, pay 14 percent or less. That's a lower tax rate than many middle-class Americans pay.

    In fact, if you add up all the taxes paid -- not just on income and capital gains but also payroll taxes (which don't apply to income above incomes of $110,100), and sales taxes -- most of us are paying a higher percent of our income in taxes than are those at the top.

    So how can anyone argue against raising taxes on the rich? Easy. They say it will slow the economy because the rich are "job creators."

    In the immortal words of Joe Biden, that's malarkey.

    The economy did just fine during the three decades after World War II, when the top tax rate never fell below 70 percent. Average yearly economic growth was higher in those years than it's been since, when taxes on the rich have been far lower.

    Bill Clinton raised taxes on the rich and the economy did wonderfully well. George W. Bush cut them and the economy slowed.

    The real job creators are America's vast middle class, whose spending encourages businesses to expand and hire -- and whose lack of spending has the opposite effect.


    That's why the recovery has been painfully slow. So much income and wealth have gone to the top that the vast majority of Americans in the middle don't have the purchasing power to get the economy moving again. The rich save most of what they earn, and their savings go anywhere around the world where they can get the highest return.

    It would be insane to compound the damage by raising taxes on the middle class and not on the rich.

    Logic, fairness, and common sense dictate that the rich pay more in taxes. It's the key to avoiding January's fiscal cliff and coming up with a "grand bargain" on taming the budget deficit. And it's central to getting the economy back on track.
    Emphasis added. Do you agree that the middle class are the real job creators? For those who support Romney, how do you feel about 93% of the nation's economical recovery going into the pockets of the top 1% when the average middle class income has gone down 8% since 2000?

    Robert Reich: The Final Days, the Biggest Issue, and the Clearest Choice
    Last edited by Spacers; 10-30-2012 at 07:22 PM.
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    The article felt very biased to me. I do believe though that if you highly tax businesses they will go under or go elsewhere. I will give the example of where I grew up vs. where I live now. I grew up in WNY. My entire childhood businesses and families left in droves. Every year in school my entire education at least a few students left my class. Businesses were not willing to stay where it was so expensive. The government was not willing to give the corporations tax breaks so the jobs moved to other places that would. Now, 31 years later there are only 2 or 3 small factories in the area that I grew up in. The only people that live in the town I grew up in, live there because they have strong family ties to that area. Many thousands have left in my life time to move to where there are more jobs and less taxes. My parents pay over $500 per month in property taxes.

    Now I live in TN. TN has been willing to give huge tax breaks to any business that has wanted to come here. In the past few years several large corporations have moved into my city bringing thousands of jobs with it. Right now there are more job openings than there are people that want manufacturing jobs and people move here every day. I think it speaks for itself that the idea of give businesses tax breaks pays off, because they bring so much to the economy. My property taxes are $600 a year.

    I know the property taxes for individuals are much different than the taxes on a corporation, but the principle is the same. A business is not going to operate where it is more expensive to operate. They just can't, and still compete with businesses that are willing to move.

    ~Bonita~

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    The article is skewed. Romney has not said at any time that he will lower taxes on the wealthy by 20%. Even if he did get to the "buffett rule" (btw, since warren buffett hasnt paid taxes in years I am not sure why it is called that) The money would last 7 days.
    I have never been given a job by a poor person. And if I were offered a job by someone that is not smart in business I wouldnt take it, the business would be going under at some point in time.

    I do not believe Romney is perfect, but I do believe that this country is headed in the wrong direction and Obama has put his foot on the gas the last 4 years. He makes very bad investments, using our money, and has zero working knowledge of how to encourage growth in an economy.

    I love the saying I have seen a few times during this election season "Apparently I am supposed to be more concerned about what Romney does with his money, then what Obama does with mine"
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    These sure sound like job creators to me.

    "families who own small businesses and earn more than $250,000 per year employ 93 percent of the people working in small businesses"

    I would much rather them keep their own money to hire employees than give it to Obama to find a way to waste it.

    When it comes to taxes, Obama is farther to the left than his Congressional leaders on this important issue. Obama wants to raise taxes on Americans making more than $250,000; Nancy Pelosi, Harry Reid and Chuck Schumer initially proposed raising taxes on those making more than $1 million. Yet, economists suggest raising taxes in January will disproportionally impact all small business owners. Regular threats of coming tax increases and short-term tweaks to the tax code pervasively chip-away at the confidence of small business owners.

    In a recent article about taxing small business owners, Professor Scott Shane cites data indicating that only 4 percent of small business owners would be subject to a tax increase if the Bush tax cuts expired. However, he went on to cite 2007 Federal Reserve data (most recent available) showing that families who own small businesses and earn more than $250,000 per year employ 93 percent of the people working in small businesses. While letting the Bush tax cuts expire will indeed only affect a low number of small business owners, it hits those who employ the vast majority of the small business workforce.

    When government takes money away from businesses (in the form of higher taxes) to use elsewhere (infrastructure projects or otherwise), the private sector gets smaller and has fewer jobs. History proves the public sector is less productive with funds than the private sector. Unemployment is higher when government is big versus times when government is small. This suggests a path toward shrinking government and marginal tax rates in order to once again grow our way out of this mess.
    Chris Hurn: Why Does Obama Dislike Small Businesses So Much?
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    Now if we want to look at the job destroyers on the other hand....

    The Bureau of Labor Statistics reported last Tuesday that employers issued 1,316 “mass layoff actions” (affecting 50 workers or more) in September; more than 122,000 workers were affected overall. USA Today financial reporter Matt Krantz wrote that “(m)uch of the recent layoff activity is connected to what’s been the slowest period of earnings growth since the third quarter of 2009.” Some necessary restructuring is underway in response to the stagnant European economy. But more and more U.S. businesses are putting the blame — bravely and squarely — right where it belongs: on the obstructionist policies and regulatory schemes of the blame-shifter-in-chief.

    Last week, Ohio-based auto parts manufacturer Dana Holding Corp. warned employees of potential layoffs amid “looming concern” about the economy. President and CEO Roger Wood specifically mentioned the walloping burden of “increasing taxes on small businesses” and the need to “offset increased costs that are placed on us through new laws and regulations.”

    Case in point: Obamacare. The mandate will cost Dana Holding Corp., which employs some 24,500 workers, “approximately $24 million over the next six years in additional U.S. health care expenses.” As Ohio Watchdog blogger Maggie Thurber reported, the firm’s Toledo area corporate offices laid off seven white-collar employees last Friday; company insiders told her more were on the way. They are not alone.

    On Tuesday, Consol Energy issued a federally mandated layoff disclosure announcing its “intent to idle its Miller Creek surface operations near Naugatuck, W.Va.” The move will affect the company’s Wiley Surface Mine, Wiley Creek Surface Mine, Minway Surface Mine, Minway Preparation Plant and Miller Creek Administration Group, all in Mingo County, W.Va. Despite state approval, cooperation with the U.S. Army Corps of Engineers and myriad other agencies, and a stellar safety record, Obama’s EPA dragged its feet on the permit approval process. The impasse has forced layoffs of 145 Consol Energy employees that will hit at the end of the year. They are not alone.

    In August, Robert E. Murray, founder and CEO of Murray Energy Corporation in Ohio, blasted the White House anti-coal agenda for the layoffs and closure of his company’s mine. He told Obama water-carrying CNN anchor Soledad O’Brien that “the many regulations that (Obama) and his radical appointees and the U.S. EPA have put on the use of coal, there are dozens of them and collectively by his own energy administration, have closed 175 power plants.” As O’Brien barked at her guest about purported environmental objections, Murray explained that “we cannot get permits for these mines. They are delaying the issuance of permits. If you can’t get the permit, you can’t have the mine. … I created those jobs, and I put the investment in that mine. And when it came time to lay the people off, I went up personally and talked to every one of them myself to lay them off. It’s a human issue.”

    And it’s an innovation issue, too. As I reported in February, Obamacare’s impending 2.3 percent medical device excise tax has already wrought havoc on the industry:

    Stryker, a maker of artificial hips and knees based in Kalamazoo, Mich., is slashing 5 percent of its global workforce (an estimated 1,000 workers) this coming year to reduce costs related to Obamacare’s taxes and mandates.

    Covidien, a N.Y.-based surgical supplies manufacturer, recently announced layoffs of 200 American workers and plans to move some of its plant work to Mexico and Costa Rica, in part because of the coming tax hit.

    Mass.-based Zoll Medical Corp., which makes defibrillators and employs some 1,800 workers in the U.S. and around the world, says the medical device tax will cost the company between $5 million and $10 million a year.

    This July, Indiana’s Cook Medical Inc. shelved plans to open five new plants because of the imminent medical device tax hit. They are not alone.

    The heads of Koch Industries, Westgate Resorts and ASG Software Solutions have all separately informed their employees of prosperity-undermining Obama economic politics. Left-wing groups have lambasted the executives for exercising their political free speech.

    But they have remained silent while the White House corruptocrats bribed federal defense contractors into delaying federally mandated layoff disclosures before the election. In a memo now being investigated on Capitol Hill, Obama promised to cover the legal fees of Lockheed Martin and other defense contractors if they ignored legal requirements to inform workers in advance about so-called sequestration cuts to the military’s budget scheduled to kick in next year.
    Michelle Malkin ? Obama’s Layoff Bomb
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    I don't think people realize how rich the really rich are. It is hard to grasp.

    I work with the ultra wealthy. It is sometimes hard to comprehend just how much money they have and the extent of their assets. I assure you, Stryker medical is doing just fine (cited in the article above.) I know bc one of our donors is part of that family and they literally give my institution millions of dollars each year. And give our city hundreds of thousands (they provide free concerts and art festivals locally-- this year headlining with people like Michael Franti and Alison Krauss.)

    It astounds me how folks at the opposite end of the wealth spectrum get all enraged about taxes on the super wealthy. My cousins and family are the biggest believers of this job creating myth (and also beneficiaries of programs like WIC, Planned Parenthood, SNAP, student loans, etc. ) The data and the history just don't prove that it works. Correlation is not causation.

    And I also don't get this myth about Obama and "big government"-- truly, so many government workers have been laid off in recent years. And I'd like to go back and see how many of those small businesses benefited from the economic spending of recent years. Most of the firms I work with were saved by federally funded projects that kept their crews working.

    Living in a swing state, I'm just looking forward to having this election over. We survived Bush (barely). I suppose we can survive Mitt if he is elected.
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    Quote Originally Posted by boilermaker View Post
    I don't think people realize how rich the really rich are. It is hard to grasp.

    I work with the ultra wealthy. It is sometimes hard to comprehend just how much money they have and the extent of their assets. I assure you, Stryker medical is doing just fine (cited in the article above.) I know bc one of our donors is part of that family and they literally give my institution millions of dollars each year. And give our city hundreds of thousands (they provide free concerts and art festivals locally-- this year headlining with people like Michael Franti and Alison Krauss.)

    It astounds me how folks at the opposite end of the wealth spectrum get all enraged about taxes on the super wealthy. My cousins and family are the biggest believers of this job creating myth (and also beneficiaries of programs like WIC, Planned Parenthood, SNAP, student loans, etc. ) The data and the history just don't prove that it works. Correlation is not causation.

    And I also don't get this myth about Obama and "big government"-- truly, so many government workers have been laid off in recent years. And I'd like to go back and see how many of those small businesses benefited from the economic spending of recent years. Most of the firms I work with were saved by federally funded projects that kept their crews working.

    Living in a swing state, I'm just looking forward to having this election over. We survived Bush (barely). I suppose we can survive Mitt if he is elected.
    I see how rich the super wealthy are (we are related to some) but I also see how the people that are making over $250000 and own small businesses live. My ILs and our aunt and uncle are both in this category. They both employ quite a few people (I think one employs 15 and the other 22) and if their taxes go up, their employees will feel it. They both make enough to live comfortably, but I wouldnt say either is living large.

    I just do not believe that taxing the super wealthy is a good plan, it would only fund our government for such a short period. I wish democrats would come up with another more long term solution, or the GOP would figure it out
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    I think it takes both. The "small" businesses that employ 93% (some of those "small businesses" are pretty wealthy) are certainly job creators, but the spending power of a healthy middle class is also extremely important to job creation. Businesses can't survive without customers, after all. Concentrating all of the wealth among the super wealthy just doesn't have the spending power that it has when it is more spread out over the middle classes; there are only so many consumer goods and services that each super wealthy family will buy. I mean, even if one super wealthy person has 50 cars, that is still not as many as the millions of cars that the middle class would buy. Same with iPods, DVDs, clothes, meals at restaurants, whatever. The super wealthy may buy much more expensive cars and clothes, but in the end I don't think they hire more people to build one super expensive car (or 50) as opposed to the amount of people they have to hire to build a million average cost cars.
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    I am concerned about the fact that the top 1 percent cut off is at 250k. I think this is low and should be adjusted to people who are wealthy wealthy. I dont think anythin under gross of 400 to 500k is wealthy like rhe million dollar incomes are. I realize the 250k is about triple the medium incines but i think it has to be further narrowed before people start talking more taxes. These are not elite incomes. These are average incomes and lifestyles for laywers, doctors, engineers among perhaps others.

    I dont honestly jnow whois responsible for job creation but i think it is a good contribution from both.
    Aisha

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    Quote Originally Posted by Alissa_Sal View Post
    I think it takes both. The "small" businesses that employ 93% (some of those "small businesses" are pretty wealthy) are certainly job creators, but the spending power of a healthy middle class is also extremely important to job creation. Businesses can't survive without customers, after all. Concentrating all of the wealth among the super wealthy just doesn't have the spending power that it has when it is more spread out over the middle classes; there are only so many consumer goods and services that each super wealthy family will buy. I mean, even if one super wealthy person has 50 cars, that is still not as many as the millions of cars that the middle class would buy. Same with iPods, DVDs, clothes, meals at restaurants, whatever. The super wealthy may buy much more expensive cars and clothes, but in the end I don't think they hire more people to build one super expensive car (or 50) as opposed to the amount of people they have to hire to build a million average cost cars.

    I don't really think they just spend all their money on things. They also buy businesses. Most of them didn't get that way by accident, they got that way by investing what they had. They invest in a business... a business then has money to employ people. They may not spend enough to hire more people to build cars, but if they buy the company that builds the cars That is how jobs are created. Every job the government creates is a job that is paid for by taxpayer money which doesn't help anything.
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