http://online.wsj.com/article/SB123940286075109617.html

 

 

Like the old competition to have the world's tallest building, New York can't resist having the nation's highest taxes. So after California raised its top income tax rate to 10.55% last month, Albany's politicians leapt into action to reclaim high-tax honors. Maybe C-Span can make this tax competition a new reality TV series; Carla Bruni, the first lady of France, could host.

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They can invite politicians from the at least 10 other states that are also considering major tax hikes, including Oregon, Illinois, Wisconsin, Washington, Arizona and New Jersey. One explicit argument for the $787 billion "stimulus" bill was to help states avoid these tax increases that even Keynesians understand are contractionary. Instead, the state politicians are pocketing the federal cash to maintain spending, and raising taxes anyway. Just another spend-and-tax bait and switch.

 

In New York, Assembly Speaker (and de facto Governor) Sheldon Silver and other Democrats will impose a two percentage point "millionaire tax" on New Yorkers who earn more than $200,000 a year ($300,000 for couples). This will lift the top state tax rate to 8.97% and the New York City rate to 12.62%. Since capital gains and dividends are taxed as ordinary income, New York will impose the nation's highest taxes on investment income -- at a time when Wall Street is in jeopardy of losing its status as the world's financial capital.

 

But who and where are all these millionaires to pluck? More than any other state, New York has been hurt by the financial meltdown, and its $132 billion budget is now $17.7 billion in deficit. The days of high-roller Wall Street bonuses that finance 20% of the New York budget are long gone. The richest 1% of New Yorkers already pay almost 40% of the income tax, and the top 0.5% pay 30%.

 

Mr. Silver thinks he can squeeze more from these folks without any economic harm, arguing that recent income tax hikes didn't hurt New Jersey. (Yes, the pols in New York actually hold up New Jersey, whose economy and budget are also in shambles, as their role model.) The tax hike lobby in Albany points to a paper by Princeton researchers reporting that the number of "half-millionaires," those with incomes above $500,000, increased by 60% from 2003-2006 after New Jersey taxes rose (the top rate is now 8.98%). But this was a boom time for the national economy, especially in the financial industry where many New Jerseyites work, or at least used to work.

 

The better comparison is how New Jersey compared to the rest of the nation. According to the study's own data, over the same period the U.S. saw an increase of 76% in half-millionaire households. E.J. McMahon, a budget expert at the Manhattan Institute, calculates that New Jersey lost more than 4,000 high-income taxpayers after the tax increase.

 

Mr. Silver says of the coming tax hikes: "We've done it before. There hasn't been a catastrophe." Oh, really? According to Census Bureau data, over the past decade 1.97 million New Yorkers left the state for greener pastures -- the biggest exodus of any state. New York City has lost more than 75,000 jobs since last August, and many industrial areas upstate are as rundown as Detroit. The American Legislative Exchange Council recently said New York had the worst economic outlook of all 50 states, including Michigan. And that analysis was done before these $4 billion in new taxes. How does Mr. Silver define "catastrophe"?

 

Oh, and it isn't just high earners who get smacked. The new budget raises another $2 billion or so on top of the $4 billion in income taxes with some 100 new taxes, fees, fines, surcharges and penalties to be paid by all New York residents. There are new charges for cell phone usage, fishing permits, health insurance (the "sick tax"), electric bills, and on bottled water, cigars, beer and wine. A New York Post analysis found that a typical family of four with an income below $100,000 would pay more than $800 a year in higher taxes and fees.

 

This is advertised as a plan of "shared sacrifice," but the group that is most responsible for New York's budget woes, the all-powerful public employee unions, somehow walk out of this with a 3% pay increase. The state is receiving an estimated $10 billion in federal stimulus money, and Democrats are spending every cent while raising the state budget by 9%. Then they insist with a straight face that taxes are the only way to close the budget deficit.

 

And so Albany is about to make a gigantic gamble on New York's economic future. The gamble is that the state with the highest cost of doing business can raise taxes on everyone who lives, works, breathes, eats or drinks in the state and not pay a heavy price for it. If they're wrong, New York will enhance its reputation as the Empire in Decline State.

 

Isn't that just like socialists? "Give" the states billions of printed money, and then take it back in the form of taxes! And they accuse Wall Street of being greedy.

"So after California raised its top income tax rate to 10.55% last month"

 

I'm moving to California as I'm fed up with paying 20% base-rate here.

"So after California raised its top income tax rate to 10.55% last month"

 

I'm moving to California as I'm fed up with paying 20% base-rate here.

 

Well that's the state's income tax rate. You pay federal income taxes on top of that. Do you guys have something similar?

I see, now I look stupid :(

 

In the UK, it's 20% up-to a certain level than 40% on top of that for income tax which goes to the tax-man which goes to fat bankers. Plus around 11% on top for national insurance which pays for the NHS and other state benefits.

It's patriotic to pay taxes, so the politicians can have more money for them and their friends to buy BMW's and drugs!

Beemers and Crack? I'm there!

What else is money for?

When 1% owns 23% of the nation's wealth, and the working classes struggle to make ends meet, it's time to reign in the excess wealth. Now what we do need is real campaign finance reform to get real representation, and to level the economic playing field so there isn't such an unfair dichotomy between the super rich and the 99% of the rest of us.

I'm not in favor of the largess going to the corrupt politicians, but neither am I in favor of the current mode of class warfare, where the have's have it all, and the workers get the shaft.

Why do the working classes struggle to make ends meet?

 

It's because the prices of basic goods/services become inflated beyond what they're actually worth. I'm convinced that in a free market economy, even part-time non-skilled manual laborers would have a white house with a picket fence and a two car garage. They don't have this, though, because of government machinations.

 

1. Interest rates would be far higher without government. That means once you earn money by your own sweat and diligence, you can save it and make it grow at a faster pace than you would today. The return would be virtually guaranteed, making it unnecessary to take exorbitant risks in the stock market like so many employees do today (401Ks). Let the rich people take the risks and lose money on bad business ventures.

 

2. Property taxes/sales taxes/inflation - all gone. Even ignoring income tax (which many poor people don't have to pay), poor people are still blasted with ridiculously high taxes on their goods/services.

 

3. Deflation. Without the printing of money, existing money becomes worth more slowly over time. Regardless of whether it's under your mattress or in a bank.

 

4. Consequences. Without a welfare state or taxpayer funded health care insurance, there would be real-world consequences to foolish behavior. Teen pregnancy, obesity, smoking, drugs, and skipping school would all be far rarer because of the apparent danger they pose without an established safety-net.

 

5. Extinction of the military class. Remember that the military is one of those "safety-nets" mentioned above. This is the reason boys are seen not performing as well in school as girls - they know it's socially acceptable (and financially lucrative) for them to join the non-productive military class. If they can't do that, they can become police officers.

 

Human action is always influenced by rationality, even if it appears irrational from a distance. It is rational to be lazy, to milk the state of taxpayer money, and to spend your paycheck the day you get it. The consequences are as negligible as the probability the state will crumble in your lifetime.

I believe the Free Market would not allow all of the CEO's to be paid as much as they are, most corporations are creation of the government. A Free Market would help spread the wealth around. Look at the pay of Asian CEO's to Americans;

 

 

Without government propping up Corprations and these top heavy companies small businesses would take over and provide more pay and benefits for the average American. The Free Market is the best way to help the overall population. Many corporations in America are top heavy with overpaid CEO's and upper management, and would get killed in a true free market..

 

Watch this video about Corporatism;

 

 

[ame=http://www.youtube.com/watch?v=dbxZhx2eENo]YouTube - Corporatism and Survival[/ame]

Free Markets are the law of the jungle. Upton Sinclair can tell you more than I can about that jungle, but suffice to say, the need for markets is essential, and so is the essential need for checks on market behaviors. The idea that markets will "self-regulate" defies the true nature of market players - to form associations, to merge, to allow for one to dominate a sector or sectors of the economy. Those more civic-minded businesses that care about their employees operate to the disadvantage of those who high-stick and trip their opponents; without an honest referee, the 'lord vaders' come to dominate, and then usurp the power of the referee, becoming lord and master over the slave workers and minions who carry out their orders. Governments only prop up corporations because we have allowed corporations to dominate governments. It is our duty and obligation as free citizens to create a fair process of selection and equitable contest for office so that those who represent us (be they presidents, congressmen, members of parliament, state representatives, or board members) work for the betterment of we, the people, and society as a whole. It is a gradual process, but not a new one - the corporate barrons of the late 19th and early 20th century did just the same, mixing corporate control of government with economic enslavement of the workers, and led to the rise of unions, even to the rise of communism in america. And in the end, it must be a goverment of, by, and for We, The People that reinstates the rightful position of citizen as "prinicipal shareholder" in that government. For the referee is the only way to keep the game fair, and the only way to keep the referee fair is to provide fair rules, and demand that the referee sticks to those rules. The referee will only stick to those rules if we ensure the referee's pay is coming from everyone in equal share; and so those in office must be given access to present their story and their credentials before the people in as equal-handed and unbiased a manner as is humanly possible to obtain.

Now when 1% of the people own 23% of the wealth of a nation, and the workers continue to slide off the deep end financially, in part from a lack of checks on those so-called "free market" behaviors, I begin to see the strong need for major reform; markets without regulation are like engines without governors - they may oscillate wildly in speed, and can easily blow themselves to pieces from lack of proper regulation.

Because of greed, corruption and stupidity humans are incapable of providing checks and balances in the market. Those checks and balances are in a free market.

 

Now when 1% of the people own 23% of the wealth of a nation, and the workers continue to slide off the deep end financially, in part from a lack of checks on those so-called "free market" behaviors,

 

Did you watch the video? This is NOT a product of a free market but the so called "regulations" you want. the market is more fair but humans intervene and the wealth is horded by the corrupt. Human intervention causes thes 1% to own the majority.

 

The Free Market has a "Referee", itself because any human Refs succumb to corruption or stupidity and hurt the majority. The earth is able to spin and go around the sun on its own without humans monitoring it and without Referee's, same thing is true for a market, its to big to ref it by a government or group or person because in the end they are inferior to a free market.

 

Humans greatest problem is not letting things be, but always trying to intervene and by doing so always cause bigger problems.

how the west was won.

 

Because of greed, corruption and stupidity humans are incapable of providing checks and balances in the market. Those checks and balances are in a free market.

I disagree. There's an oscillation between inequities, uprisings, reforms, stability, and then corruption setting in again; the public responds eventually, and with reasonable intelligence, if given enough honest information and time to reflect and make an informed choice.

Checks and Balances: But if not for the enlightenment we wouldn't have the carefully crafted Republic we have, for Madison and others took great pains to reduce the possibility of failure in our system, and a descent into a totalitarian state which befelled other Republics before ours. The natural extent of checks and balances is put into the markets, but gradually gets eroded over time when the economy improves, and the memory of market failings fade.

 

 

 

Did you watch the video? This is NOT a product of a free market but the so called "regulations" you want. the market is more fair but humans intervene and the wealth is horded by the corrupt. Human intervention causes thes 1% to own the majority.

The regulations may have to be improved, but the idea of regulated markets is sound. Markets inherently need oversight, or those given to unscrupulous methods begin to control market, media, and government, to the disadvantage of even themselves in the long run. It is the intervention of a wealthy minority of that wealthy minority who have no desire for fair play and great desire for absolute control of the world that have caused much of the problems. They pay for the campaigns, buy legislative influence thusly, and embed their own ilk in the very agencies charged with regulating their behavior. It is their excessive lust for gambling and pure greed which has allowed so many to be taken by so few.

 

The Free Market has a "Referee", itself because any human Refs succumb to corruption or stupidity and hurt the majority. The earth is able to spin and go around the sun on its own without humans monitoring it and without Referee's, same thing is true for a market, its to big to ref it by a government or group or person because in the end they are inferior to a free market.

The free market has no brain, except the purchasing choices of a consuming public. If that public has a deep understanding of those purchasing choices, that can make a difference, but when the reality behind those choices is complex (food nutrition issues, for example), it is reasonable to have the oversight of a body acting as referee for us all; a body which can see deeply into specialized matters too cumbersome for the individual to manage. That body needs to be responsive to protecting our needs and interests, and needs to deal with reasonable fairness and accuracy towards the market institution involved. Referees only succumb to corruption when we allow corrupting forces from those market players with few social values to "buy off" the refs.

Celestial bodies are not social creatures; non-sequitur. Markets are a sort of game, and a good one at that, if the winning is done fairly by players who produce better goods and services, or who increase social capital, while abiding by commonly accepted rules in society. But government has the capacity to do what markets cannot - study things that affect society, and provide checks on our behalf to prevent the excesses & abuses of un-regualted market activities. It is up to us to keep that government working for the common good, and keeping it mindful of the rights of individuals.

 

Humans greatest problem is not letting things be, but always trying to intervene and by doing so always cause bigger problems.

If history is any lesson, we are better off having honest government than having no government; the cemeteries here are full of individuals who tried to settle their disputes individually in a lawless land; half died of silicosis from the quarries, and the other half from gunshot wounds. And the men with the top hats ran off with the loot. I'll take civilization any day!;)

It's patriotic to pay taxes, so the politicians can have more money for them and their friends to buy BMW's and drugs!

 

What's wrong with that?

If history is any lesson, we are better off having honest government than having no government; the cemeteries here are full of individuals who tried to settle their disputes individually in a lawless land; half died of silicosis from the quarries, and the other half from gunshot wounds. And the men with the top hats ran off with the loot. I'll take civilization any day!;)

 

I didn't say no government, I think we need a small one(sorry Jay). What we don't need is government corruption trying to control something it cannot and by doing so makes bigger problems. I don't think you understand at all what I'm talking about, no offense but this is part of the problem, people who don't understand economics wanting to control it.

 

But to counter your point didn't the "Civilization" during that period massacre millions of Indians? I'm not arguing against all government, just government in the market trying to control what they don't understand and can't control.

What's wrong with that?

 

I want the BMW and drugs not the bureaucrats!

I didn't say no government, I think we need a small one(sorry Jay). What we don't need is government corruption trying to control something it cannot and by doing so makes bigger problems.

To presume that government cannot be made ethical is untrue in it's absolute. Government, like any entity, can be more or less ethical, depending on how we as citizens act to either correct or ignore the problems.

Government is the referee, without which feudal city-states and feudal castles of robber-barons rule the earth.. The government we have is perhaps the worst, except for all the other alternatives. I'd rather try and fix a pretty good design in charge of oversight on our behalf, than throw it out in favor of anything-goes market capitalism. Safety-nets and checks and balances are essential to the long-term stability of this nation, and to the world's nations.

I don't think you understand at all what I'm talking about, no offense but this is part of the problem, people who don't understand economics wanting to control it.

I think I do understand what you're talking about, I simply think that you're not interested in seeing the negative consequences of unregulated market systems, and the cyclical nature of reform, Nick. If we assume we cannot correct government's oversight to make it more ethical and effective because the 'corruption' is too powerful a force to overcome, then by that logic we would have never had the capacity to extend human rights, nor public works through the collective actions of our government. What I see as a necessary step is to check and balance the influence of money 'given' by and unscrupulous few who corrode the positive effects of government by basically bribing politicians visa via campaign money. It was never so corrupt as it is today, and there comes a time when we must all work to check this wrong.

 

But to counter your point didn't the "Civilization" during that period massacre millions of Indians? I'm not arguing against all government, just government in the market trying to control what they don't understand and can't control.

Yes, the "civilization" of that period was brutal in many ways. Small pox blankets were given by settlers to the native tribes-people here and elsewhere, and once decimated, the tribes were by war and disease forced to concede their lands to a large extent. What was lacking was an extension of human rights to all humans, regardless of ethnicity, sex, income level, etc. - the promises & philosophies in the Constitution had yet to be fulfilled. So, on the one hand, these higher ideals were put forth, but on the other hand, "civilization" at that that time hadn't fully come to terms with those higher ideals. In time, as we progressed, our government became the embodiment of those rights. As the purveyor of higher ideals and arbiter of fair-play, it is ultimately our government, and to make it better through our actions is our true "manifest destiny".

To assume that our government cannot understand & correctly regulate markets is a leap without justification. True, government regulation can become out-dated or stifling of innovation, if it's not improved and corrected from time-to-time, but it is in my estimation necessary for some government oversight to provide the proper framework for markets to operate fairly in society.

Those who do the oversight must be well versed in how markets function, they must be ethical, they must be willing to listen to all sides of an argument, and they must ultimately be responsive to the the best interests of the citizens, and respectful of individual liberties. To the logical extension of this in the modern world, it's important to factor in global issues such as fair trade, human rights, labor standards, and environmental factors. If these issues cannot be resolved in an international consensus, then it is up to the individual nations to take up the task of ensuring justice and equity in market matters.

And to ensure honest government is to remove the undue influences of a moneyed minority upon those elected to represent us in government. Corrections happen, and we're long overdue for one!;)

 

It is not a leap my friend, I can show you time and time where government messed up, the worst economic periods were government involved while the best times are when we had the freest market, that is what history has taught. I simply say rely on history to prove this point.

 

Even in a complete honest government, they cannot control or regulate a economy, it has NEVER worked, the BEST economies in human history were the freest ones. Like we cannot control the movement of the earth around the sun or many things in this universe governments cannot effectively control markets, it simply is impossible.

 

Too often humans think they can do anything, we cannot change many things its something we must accept, not fight.

I disagree - the New Deal was helpful in getting us out of the Depression, but perhaps wasn't enough of a stimulus - we could have used more government inputs, not less. It is only after a disaster, when government has to step in and right the ship of state that markets again stabilize and begin to function. The period of prosperity that follows often entails a loosening of controls, and some corruption begins to set in again, whereupon the unregulated engine of commerce begins to run out of control and do damage. While it is prosperous, it's the framework of government that got us back on track.

Government must regulate the markets and it has worked - hence, the Glass-Steagall act (which was unfortunately repealed in the 80's under pressure from Wall Street) helped insulate banking from the whims of the market. And without government, public works would have never happened - enterprises too large with too great a turn-around time, and with enormous risks would not be undertaken (Hoover Dam, the Channel Tunnel, etc.). Only after government paves the way, does business follow suit - yes, often improved over the government venture, if checks and balances are in place.

We cannot control the movement of celestial bodies, but we can set forth rules in society of accepted fair practice between individuals and groups. So, yes, government has for a long time had a role to play in being the oversight on behalf of the people, where long-term planning and broad concerns are of issue. Hence, after the Chicago fire, brick buildings and strict fire codes reduced the numbers of fires and the extent of damage from a given fire. Markets alone have no broad concerns in society.

The same could be said of the triange shirt factory fire in NYC - oversight is essential to ensure the public safety. Today, we see sweat-shops turning out clothing, using people as virtual slaves who are trapped in these despirate situations; it is the role of honest government to right the wrongs in society, where any one individual cannot. And it is up to us to keep that govenment honest.

To accept gross disparities is anathema to human progress - progress has been made, and will continue to be made, if we continue to be dilligent in our efforts for greater equity in the world. Accepting an injustice is to buy into certain institutionalized inequities, and we must not become too complacent, for it is through our diligent efforts at correcting wrongs that we make progress as a people.

The "big bonus" culture needs to be eliminated too.;)

Until they get rid of tax havens, the rich will still get away with paying low tax

Until they get rid of tax havens, the rich will still get away with paying low tax

 

Or the only rich will be the ones in government and friends of politicians who get special treatment.

I disagree - the New Deal was helpful in getting us out of the Depression, but perhaps wasn't enough of a stimulus - we could have used more government inputs, not less. It is only after a disaster, when government has to step in and right the ship of state that markets again stabilize and begin to function. The period of prosperity that follows often entails a loosening of controls, and some corruption begins to set in again, whereupon the unregulated engine of commerce begins to run out of control and do damage. While it is prosperous, it's the framework of government that got us back on track.

Government must regulate the markets and it has worked - hence, the Glass-Steagall act (which was unfortunately repealed in the 80's under pressure from Wall Street) helped insulate banking from the whims of the market. And without government, public works would have never happened - enterprises too large with too great a turn-around time, and with enormous risks would not be undertaken (Hoover Dam, the Channel Tunnel, etc.). Only after government paves the way, does business follow suit - yes, often improved over the government venture, if checks and balances are in place.

We cannot control the movement of celestial bodies, but we can set forth rules in society of accepted fair practice between individuals and groups. So, yes, government has for a long time had a role to play in being the oversight on behalf of the people, where long-term planning and broad concerns are of issue. Hence, after the Chicago fire, brick buildings and strict fire codes reduced the numbers of fires and the extent of damage from a given fire. Markets alone have no broad concerns in society.

The same could be said of the triange shirt factory fire in NYC - oversight is essential to ensure the public safety. Today, we see sweat-shops turning out clothing, using people as virtual slaves who are trapped in these despirate situations; it is the role of honest government to right the wrongs in society, where any one individual cannot. And it is up to us to keep that govenment honest.

To accept gross disparities is anathema to human progress - progress has been made, and will continue to be made, if we continue to be dilligent in our efforts for greater equity in the world. Accepting an injustice is to buy into certain institutionalized inequities, and we must not become too complacent, for it is through our diligent efforts at correcting wrongs that we make progress as a people.

 

With respect, every aspect of the new deal pushed us further into economic depression. That has been proven....

 

Government must regulate the markets and it has worked

 

Please in detail back this up with examples.

Untrue! The new deal got us out of the depression, but did not go far enough. I'll link to Robert Reich: (one moment please)Robert Reich's Blog

And again, the regulations to protect investors (which were gradually wiped out); Glass-Steagall et al. to provide a firewall between Banks and Wall Street. The regulations on products to ensure product safety; Anti-trust laws enacted to bust up monopolies and trusts (long overdue in 1910 & today with media consolidation); Regulations preventing businesses from selling below cost for the purpose of elminating competition (minimum mark-up laws); Regulations ensuring that businesses must provide adequate fire-protection and fire escapes (after disasters like the Triangle Shirt factory fire). Regulations to limit the powers of corporations (good regulations, lost due to powerful wealthy individuals influencing the courts and the legislatures) Need I say more?

I have no objections to wealth that is honestly gained; but when a few wealthy indiviudals begin to control everything, and there are no checks on their behavior, I begin to think we are loosing the middle class and the checks and balances that maintain our Republic.

Those in government need to be checked as well, but the check is to have them accountable to broad bases of support, not narrow minorities of the wealthy elites. George Soros will even tell you that! Who is Goldman Snacks, and why do they give so many snacks to everyone running for congress??:P They got the snacks the big-shots want alright - and that's the problem in a nut-shell!;)

The most regulated banks and companies are the ones in the biggest trouble...

 

 

I want examples of the New Deal doing something good....dates, numbers....not propaganda from the new dealist...

 

Many of the things you just mentioned have to do with central planning and that has always failed, you can't price control, soviets tried it as many nations and it failed.

 

"despite seven years of "economic salvation" at the hands of the Roosevelt administration (the normal, pre-Depression unemployment rate was about 3 percent). Per capita GDP was lower in 1939 than in 1929 ($847 vs. $857),"

 

The funny things was the "Great Depression" was small at the start compared to most economic troubles in history, it should have been a minor even in history, but the government overreacted and sent us into a depression.