Republicans And Business Groups Unable To Find One ‘Job Creator’ Who Opposes A Tax On Millionaires

[BigLouie]

Yesterday, Republicans again shot down an extension of a payroll tax break for middle-class families due to their objection to a 1.9 percent tax increase on the top 0.2 percent of income earners. Naturally, Republicans are recycling their spurious claim that taxing America’s millionaires will somehow hit small businesses and stifle job creation. “It’s just intuitive that, you know, if you’re somebody who’s in business and you get hit with a tax increase, it’s going to be that much harder, I think, to make investments that are going to lead to job creation,” said Sen. John Thune (R-SD).

Hoping for more than Thune’s intuition, NPR put out a request to Republican offices and the business groups that have been lobbying against the surtax to find business owners who’d be affected. Unsurprisingly, Republican leadership and the business groups came up empty:
We wanted to talk to business owners who would be affected. So, NPR requested help from numerous Republican congressional offices, including House and Senate leadership. They were unable to produce a single millionaire job creator for us to interview.

So we went to the business groups that have been lobbying against the surtax. Again, three days after putting in a request, none of them was able to find someone for us to talk to. A group called the Tax Relief Coalition said the problem was finding someone willing to talk about their personal taxes on national radio.

There’s good reason why Republicans came up empty. Just 2 percent of people with any business income, large or small, would be affected by this tax increase.

Contrary to the GOP’s rhetoric, NPR found several business owners who’d be affected who insisted that the tax wouldn’t hurt hiring at all. “It’s not in the top 20 things what we think about when we’re making a business hire,” said one business owner. It “didn’t even make it on the agenda.” Another business owner said that, even with slightly less disposable income, the marginal tax rate “has nothing to do with what my business does.”

Indeed, business owners have long been telling Republicans that the marginal tax change makes “zero difference” in hiring. “I’m no sure what the connection is” between raising tax rates and hiring, said Anchor Brewing CEO Keith Greggor, adding that not a lot of “small-business owners I know are millionaires.” But Republicans like Thune refuse to let facts challenge their dogma. “I think most small-business owners who are out there right now would argue that raising their taxes has the opposite effect that we would want to have in a down economy,” he said.

[CuteOldGuy]

I don't support the income tax, but the Republicans' stand on this is ridiculous. They are turning a minor tax increase on the rich into huge electoral losses in November. They would do much better by supporting this tax increase and give the appearance of protecting the middle class. Of course, it is just the appearance, neither party supports the middle class.

[budman33]

Yes this is dumb. The plutocrats max out their contribution on January 2nd.

"In terms of dollars, this is good news for those at the middle and at the top. A taxpayer making $50,000 per year will see a savings of $1,000 (2% of $50,000). If a married couple each makes $100,000, the savings would be a combined $4,000 (2% of $200,000).

At the low end, though, taxpayers miss out. The payroll tax holiday is intended to replace the Making Work Pay Credit. That credit still applies for tax year 2010, but under the tax deal, it has been eliminated for 2011. Since the credit was a flat $400 for individuals and $800 for married couples, taxpayers at the lower end could get the full credit even if they didn't make that much money (at the higher end, phase-outs applied). However, the payroll tax holiday is based on a percentage, which means fewer dollars back for lower income families. For example, a married couple making $20,000 and filing jointly would have received $800 with the Making Work Pay Credit but under the payroll tax holiday, will only receive $400."

http://www.dailyfinance.com/2011/01/...om-payroll-ta/

[Texas Contrarian]

This thread points out some of the misleading, disingenuous nonsense peddled by both political parties.

For instance, just consider this statement:

Originally Posted by BigLouie

Just 2 percent of people with any business income, large or small, would be affected by this tax increase.

That gets widely parroted by members of the media who are biased, clueless, or both. But anyone who takes just a second to think about it will notice the fatuousness of the claim. Of course only a tiny percentage of small businesses are owned by those in the top 0.2% of the income strata, since the vast majority of "small businesses" are one-or-two-person operations which produce little income and create few jobs outside the immediate household. If someone makes a few thousand bucks selling stuff on eBay, for instance, and files a "schedule C", that is counted as a small business.

Equally disingenuous statements are made by those on the other side of the issue.

For instance, there's this:

Originally Posted by BigLouie

“It’s just intuitive that, you know, if you’re somebody who’s in business and you get hit with a tax increase, it’s going to be that much harder, I think, to make investments that are going to lead to job creation,” said Sen. John Thune (R-SD).

In the first place, in this era of high levels of income disparity it seems to me that it must be very bad politics for Republicans to block any tax increase on the affluent, even a relatively small one, at all costs. It just looks like political suicide.

But Thune, apparently in a simple attempt to repeat a partisan talking point, seems to completely misunderstand the issue. The proposed tax increase would make little or no difference in employers' job-creation and capital formation capabilities because they wouldn't have to pay it!

The reason is really very simple. Now it just so happens that the top-bracket corporate income tax rate (35%) and the top-bracket rate on individual income are the same. Therefore, many owners of fairly lucrative small businesses take "pass-through" income from LLCs or Subchapter S corporations, since in either case the income stream is taxed at the same rate.

Now some politicians want to push the top bracket individual income tax rate as high as possible, perhaps back to 39.6% with a surcharge stacked on top of that. But no one is discussing raising the top corporate rate, especially since the OECD average rate has dropped to around 25% in recent years. In fact, there's pressure to lower the corporate rate, while getting rid of various loopholes and exclusions, in order to make U.S. businesses operating in the international arena more competitive.

The obvious effect of these changes would be to incentivize business owners to refrain from taking any more salary income than necessary, while leaving as much as possible taxed at somewhat lower corporate rates.

That's the real reason the proposed tax surcharges won't affect capital formation or job creation. But you should not expect anyone in the media to point it out, which will probably surprise no one. Why let facts get in the way when there are political points to be scored and axes to be ground?

And that's also part of the reason that the surtax on "millionaires and billionaires" will only raise a fraction of the revenue predicted by its supporters.

Of course, some politicians continually fantasize about massive new vote-buying schemes finaced by a gusher of revenue from taxing the wealthy. But it isn't going to materialize.

[Sensia]

Well from the get go Republicans said they would not work with the President on anything period (in the hopes of making him fail) and getting him out of office. But on some of these issues the Republicans are actually hurting themselves. It is that whole "cut off your nose to spite your face" type thing.

[Iaintliein]

Originally Posted by Guilty Pleasures

Well from the get go Republicans said they would not work with the President on anything period (in the hopes of making him fail) and getting him out of office. But on some of these issues the Republicans are actually hurting themselves. It is that whole "cut off your nose to spite your face" type thing.

That, my dear, is a lesson learned the hard way. Each and every time the GOP made deals with the dems to combine tax increases with spending cuts and the dems never, ever honored their part of the deal. The term "bipartisan" has been essentially redefined by the left as "bend over".

Since the POSITOO's policies are seen by the vast majority of the constituents of the GOP as 180 degrees wrong for the country their elected representatives have the duty to prevent their implementation. It's really that simple, we don't want the snake oil he's pushing, not a single drop of it.

[Iaintliein]

So far, it's been pretty hard to find a rich Dem supporter who actually pays the taxes their already supposed to pay, even in the cabinet.

I'm guessing this guy is all in favor of increasing taxes to!

http://www.nypost.com/p/news/local/m...XVlP0sh79dWyxL

[Texas Contrarian]

Heaintliein!

And one of the biggest problems with all this is that the vote-buying schemes have largely centered around things like phony "stimulus packages", which are really nothing more than payoffs to favored constituencies. That sort of thing does little more than camouflage serious structural problems in our debt-riddled, consumption-dependent economy, while in essence fixing nothing.

No one seems interested in actually undertaking the tough, unpopular task of actually fixing anything. It's business-as-usual in Washington, where eveyone is focused only on the next election.

Just look at the recommendations of the Simpson-Bowles commission, which at least offered a few starting points for discussion. But after Obama called for it, he simply extended his middle finger toward it earlier this year, instead choosing to offer a grossly unserious budget that virtually no Senate Democrats supported.

[WTF]

Originally Posted by CaptainMidnight

No one seems interested in actually undertaking the tough, unpopular task of actually fixing anything. It's business-as-usual in Washington, where eveyone is focused only on the next election.

.

And by no one, you mean neither party! People like Iaintlien who think the GOP is some how better at not spending our money than the Dems is sadly mistaken.

That is what is wrong with this country, lack of understanding simple math problems.

That is a problem on both sides. In other words politics as usual.

[Laz]

All this is what makes people cheer for Ron Paul.