Breaking promises so soon? Aww Barry, what about the ChAnGe?

Quote :

Administration open to taxing health benefits
Proposal problematic for Obama as he denounced similar one in campaign

WASHINGTON - The Obama administration is signaling to Congress that the president could support taxing some employee health benefits, as several influential lawmakers and many economists favor, to help pay for overhauling the health care system.

The proposal is politically problematic for President Obama, however, since it is similar to one he denounced in the presidential campaign as “the largest middle-class tax increase in history.” Most Americans with insurance get it from their employers, and taxing workers for the benefit is opposed by union leaders and some businesses.

In television advertisements last fall, Mr. Obama criticized his Republican rival for the presidency, Senator John McCain of Arizona, for proposing to tax all employer-provided health benefits. The benefits have long been tax-free, regardless of how generous they are or how much an employee earns. The advertisements did not point out that Mr. McCain, in exchange, wanted to give all families a tax credit to subsidize the purchase of coverage.

http://www.msnbc.msn.com/id/29703278

Ruh-roh scooby.... so much for cutting taxes for 95% of workers and their families...

Ohhmama wrote:

Quote :

Administration open to taxing health benefits
Proposal problematic for Obama as he denounced similar one in campaign

WASHINGTON - The Obama administration is signaling to Congress that the president could support taxing some employee health benefits, as several influential lawmakers and many economists favor, to help pay for overhauling the health care system.

The proposal is politically problematic for President Obama, however, since it is similar to one he denounced in the presidential campaign as “the largest middle-class tax increase in history.” Most Americans with insurance get it from their employers, and taxing workers for the benefit is opposed by union leaders and some businesses.

In television advertisements last fall, Mr. Obama criticized his Republican rival for the presidency, Senator John McCain of Arizona, for proposing to tax all employer-provided health benefits. The benefits have long been tax-free, regardless of how generous they are or how much an employee earns. The advertisements did not point out that Mr. McCain, in exchange, wanted to give all families a tax credit to subsidize the purchase of coverage.

http://www.msnbc.msn.com/id/29703278

Ruh-roh scooby.... so much for cutting taxes for 95% of workers and their families...

Yeah. Well first of all the tax cut is already in place, and takes effect in April.

Nowhere in this article does it say anything about taxing all health benefits, regardless of income level or the value of the benefits. In fact, unlike McCain's plan, it envisions some kind of "means testing" to determine tax liability.

Quote :

Those who want to tax benefits in whole or in part make two main arguments. They say the tax exclusion is a generous subsidy that insulates employees from the true costs of health care, leading them to demand more of it and driving up overall costs. Critics also say the policy is unfair because it favors higher-income people. “It’s too regressive,” Mr. Baucus said. “It just skews the system.”

But in a blueprint for health legislation that he issued last November, Mr. Baucus said taking the exclusion on health benefits out of the tax code would go “too far” and “cause widespread disruption in employer-based health benefits.” Mr. Obama has also said he wants to preserve employer-provided coverage. Mr. Baucus, in his paper, cited other options, like taxing benefits above some value, taxing only wealthy employees or both.

If the new health care insurance plan is going to be enacted, there has to be some mechanism to pay for it.

In any case, I don't see how you can characterize a sweeping revision of the health care insurance coverage system as somehow not being worthy of being called "change." The Obama Administration needs to be "open" to any and all ideas that get the country closer to Universal Coverage. There will need to be compromises by all parties involved in the negotiations, which are certain to be long and difficult.

The change I was referring to was breaking his promises. I'd like to see just one politician change and do what he actually says- all of it.

It's been promised that 95% of us wouldn't see a tax increase, now the opposite could be happening. I don't see how much more can be put on our backs to supplement. Do you really see this not affecting the middle class? I just don't. The wealthiest of individuals won't be able to handle it on their own either- I've heard stories of people who said they will try to make sure to make less than what Obama calls wealthy so they don't have to pay extra in taxes- where does it go then, to us in the middle class.

Ohhmama wrote:

The change I was referring to was breaking his promises. I'd like to see just one politician change and do what he actually says- all of it.

It's been promised that 95% of us wouldn't see a tax increase, now the opposite could be happening.

Like I said, there is nothing in the article that suggests that.

Ohhmama wrote:

I don't see how much more can be put on our backs to supplement. Do you really see this not affecting the middle class? I just don't. The wealthiest of individuals won't be able to handle it on their own either- I've heard stories of people who said they will try to make sure to make less than what Obama calls wealthy so they don't have to pay extra in taxes- where does it go then, to us in the middle class.

No, I don't see it affecting the middle class.

Ohhmama wrote:

The wealthiest of individuals won't be able to handle it on their own either- I've heard stories of people who said they will try to make sure to make less than what Obama calls wealthy so they don't have to pay extra in taxes- where does it go then, to us in the middle class.

You know, I've also heard some "talking heads" say that, but it's just a ludicrous assertion. Keep in mind that we're talking about marginal tax rates. That means that the highest income earners will still pay exactly the same amount as they are paying now for the first 250,000, and then 4 percent or so more for the amount above 250,000. I just can't imagine that people would decide to forego further income above 250,000 because of an extra 4% tax on the income above that. That's just plain stupid.

Sorry but that's what I heard. I'd provide a link, but it was a caller on a radio show that made the statement that her husband will be working less to avoid having to pay more... so it must not be marginal to them.

You know what I'd like to see? Those in Congress who don't pay their taxes, 1) pay them and 2) get penalized harshly for not doing so.

Ohhmama wrote:

Sorry but that's what I heard. I'd provide a link, but it was a caller on a radio show that made the statement that her husband will be working less to avoid having to pay more... so it must not be marginal to them.

Sure it is. But our tax system is so frickin' complex that I'm not surprised that there is confusion.

Ohhmama wrote:

You know what I'd like to see? Those in Congress who don't pay their taxes, 1) pay them and 2) get penalized harshly for not doing so.

Who are you talking about? I imagine that most of the members of Congress do pay their taxes. Those who don't are subject to the same penalties as the rest of us.

Here is a link with an online calculator that shows how much of a tax cut we will receive.http://www.americanprogressaction.org/issues/2009/03/tax_cut_calculator.html/# I realize that posting an actual link that shows actual savings is not as convincing as repeating info heard on a call-in talk show, but that's my two cents.

sparks wrote:

Here is a link with an online calculator that shows how much of a tax cut we will receive.http://www.americanprogressaction.org/issues/2009/03/tax_cut_calculator.html/# I realize that posting an actual link that shows actual savings is not as convincing as repeating info heard on a call-in talk show, but that's my two cents.

Ouch was that a lame attempt at a burn?

sparks wrote:

Here is a link with an online calculator that shows how much of a tax cut we will receive.http://www.americanprogressaction.org/issues/2009/03/tax_cut_calculator.html/# I realize that posting an actual link that shows actual savings is not as convincing as repeating info heard on a call-in talk show, but that's my two cents.

Here's a linky-link for you since you are so fond of them. Comments made by those who say the same things as some person on a silly call-in talk show. Just my two cents.

Ohhmama wrote:

sparks wrote:

Here is a link with an online calculator that shows how much of a tax cut we will receive.http://www.americanprogressaction.org/issues/2009/03/tax_cut_calculator.html/# I realize that posting an actual link that shows actual savings is not as convincing as repeating info heard on a call-in talk show, but that's my two cents.

Here's a linky-link for you since you are so fond of them. Comments made by those who say the same things as some person on a silly call-in talk show. Just my two cents.

Exactly how does your link support your contention that Obama is breaking his campaign promise? The first thing that strikes me is these people are full of crap. The top tax rate in the US hasn't been 50% since 1986.Here is a link that lists federal tax rates since 1913.
Which goes right back to my point a few posts ago. If you are looking to win respect on any discussion forum, you will do so by making an intelligent argument that you back up with proof,not by posting stories of dubious credibility that you hear on radio talk shows.

Yawn. Your attempts to bait me into an arguement on this board won't work. Keep trying though! Nor am I worried about winning your respect.

The link I provided was to show how individuals making more that $250,000 are cutting back in their income to avoid paying additional taxes... NOT THAT OBAMA WAS BREAKING A CAMPAIGN PROMISE! You wanted a link and I provided one. Because you find their credibility dubious, well, that is your problem.

Ah yes, the "John Galt" nonsense. OK. Let's take a look at the contention made by the couple who were making 400K.

Quote :

Jonah, a few years ago, I lived in Manhattan (we met briefly one year at a cocktail hour at some bar on 2nd Av when I was at [job description withheld]). My bride and I together were pulling down about 400k per year. (btw, we didn't feel rich, we didn't act rich, and Bernie Madoff never took us into his confidence, either.)

At the same time, every dollar we earned was being taxed about 50% (I mean, taxed where I could see it being taxed)

Here's a link to the Federal Income Tax Tax tables for 2007. I just picked a year at random.

http://www.irs.gov/formspubs/article/0,,id=164272,00.html

OK, so let's do the math. If we go to Schedule Y-1 — Married Filing Jointly or Qualifying Widow(er), we see that the tax for a couple making 400,000 is:

$94,601.00 plus 35% of the amount over 349,700

94,601 / 349,700 = 27% - The tax rate on the income up to $349,700

Now let's look at the income over 349,700, which is taxed at 35% - The Marginal Rate

400,000 - 349,700 = 50,300 X 35% = $17,605

Now if we add the $17,605 to the $94,601, we get $112,206. So what's the effective tax rate on the entire 400K?

112,206/400,000 = 28%

And keep in mind this is assuming there are no deductions or credits at all, which means the the 400K is based on the Net Income after adjustments, not the Gross income. In reality, this couple would have adjustments that reduced their tax liability, but hopefully this illustrates what I was talking about in my post.

BTW - Comments on Free Republic are about as reliable as comments from Daily Kos. They are both "fever swamps," on the extreme ends of the political spectrum. You probably already know this, and I realize that you were simply trying to provide an example.

Quote :

You probably already know this, and I realize that you were simply trying to provide an example.

Exactly. The comment was essentially made that there was no link and well, blah, blah, blah... so I found a link providing the same sentiments of what I had heard on the "call-in talk radio show". that's all.

Scorpion,

Wouldn't the AMT come into effect? Also, the quote doesn't specify if they meant total federal, state and local or just federal. So, they could pay 50%.

Robin Banks wrote:

Scorpion,

Wouldn't the AMT come into effect? Also, the quote doesn't specify if they meant total federal, state and local or just federal. So, they could pay 50%.

I was trying to keep it simple, and I doubt that the AMT would make an appreciable difference. Note that I assumed zero deductions. While it's true that this couple obviously paid other taxes, the real question is whether there is a disincentive to make more money. And unless you're some sort of wacky idealogue that would prefer to "make a statement" instead of make more money, there is no disincentive.

Personally, I'd take the extra money. I don't make 400K, but I make enough to get socked really hard by taxes. If I had an opportunity to make more money, but it would push me into the highest tax bracket, I can tell you that I would do it without hesitation. I wouldn't like paying a higher marginal rate, and in any case, paying 4 cents on the dollar more on the amount over 250,000 (which is what we're actually talking about) sure as hell isn't a reason to forego the income.