(06-18-2011 11:02 PM)Paul M Wrote:  You have 1000 people working. They pay 1000 dollar each in taxes. That's $1,000,000 in revenue. Cut taxes 5%. $950 each. Add 100 jobs. Total revenue just went up 4.5% to 1,045,000.

Not rocket science.

You are assuming that those extra jobs will be created when you cut taxes. There is no guarantee they will be created.

(06-18-2011 08:58 PM)RobertN Wrote:  

(06-18-2011 07:52 PM)SouthGAEagle Wrote:  Why do stores have sales? If they cut prices, their revenues will go down....

Or maybe, it drives people to the stores, and they make more money than they would with higher prices.

I have a little story to tell you. THere was once this retail store named "Venture". Following so far? Good. I don't want to lose you. THis store had lots of debt and was floundering. In order to try to get out of debt they decided expanding was the best option. So they did. Still with me? THey expanded into new markets by adding more stores(including the beloved Texass). Hoping this would give them some added buying power and more customers thus turning things around. They tried everything. Lowering prices and at Christmas giving every certain number of customers(think it was every 15) their purchase would be free. As time went on it was apparent that despite having less help than K-Mart and lowering their prices, their losses kept on mounting. Still following? Why was this happening I kept asking myself? Then it dawned on me. You can't grow your way out of deep debt. You can't build enough stores to grow your revenue faster than you spend it on the infrastructure needed for expansion(in this case stores) and pay off your debts.

Your example is lacking an awful lot of details to even determine what could have been the true root cause of the problem. I see what your are trying to do with your example, but it is contrived. In the real world, a floundering company with significant debt would NEVER try to grow their way out of their indebtedness. The typical profile of a rapidly expanding company is that it will carry a significant amount of debt, or incur losses, because its cash inflows cannot keep up with its cash outflows that are going into expansion. But a rapidly expanding company would start out as a healthy company in the first place.

If your company is floundering, your first order of business is to stop the bleeding. Stopping the bleeding means you control costs. Controlling costs can normally be controlled much more easily than trying to grow revenue - unless a significant amount of your costs are being obligated by contractual agreements like with a workers union. For example, if a significant percentage of your costs are tied to union wages (fixed entitlement spending like social security and medicare) and your company is floundering, a common approach to control costs that are otherwise contractually obligated is to try to modify the union contract (modify the entitlements). This is what had to happen at companies like Delphi and other automotive parts manufacturers who could not compete due to high labor wages.

If you elect to minimize your efforts on the cost side and focus on the revenue side, it becomes more risky. If you increase your prices (raise taxes), you may get that extra revenue. However, if the consume does not believe in your product (or if regular citizens don't believe in the high amount of gov't spending), they will elect not to consume the product (try to avoid paying the higher taxes).

(06-18-2011 11:14 PM)RobertN Wrote:  

(06-18-2011 11:02 PM)Paul M Wrote:  You have 1000 people working. They pay 1000 dollar each in taxes. That's $1,000,000 in revenue. Cut taxes 5%. $950 each. Add 100 jobs. Total revenue just went up 4.5% to 1,045,000.

Not rocket science.

You are assuming that those extra jobs will be created when you cut taxes. There is no guarantee they will be created.

You're right, there is no guarantee that the extra money would be used directly to create more jobs. But what if that extra money is invested in the markets? What if regular everyday people take the extra tax savings and pay down their debts? The extra money invested in the markets will cause the markets to go up. Rising stock markets make consumers feel better because when 1) their 401k's go up in value and/or 2) their house goes up in value they feel richer and will be more willing to spend money. Also, if consumers get rid of debt then they will feel more secure and given time will want to start spending money again. See how that works? It's always a good thing to let people keep more of their own money.

(06-18-2011 11:53 PM)miko33 Wrote:  

(06-18-2011 11:14 PM)RobertN Wrote:  

(06-18-2011 11:02 PM)Paul M Wrote:  You have 1000 people working. They pay 1000 dollar each in taxes. That's $1,000,000 in revenue. Cut taxes 5%. $950 each. Add 100 jobs. Total revenue just went up 4.5% to 1,045,000.

Not rocket science.

You are assuming that those extra jobs will be created when you cut taxes. There is no guarantee they will be created.

You're right, there is no guarantee that the extra money would be used directly to create more jobs. But what if that extra money is invested in the markets? What if regular everyday people take the extra tax savings and pay down their debts? The extra money invested in the markets will cause the markets to go up. Rising stock markets make consumers feel better because when 1) their 401k's go up in value and/or 2) their house goes up in value they feel richer and will be more willing to spend money. Also, if consumers get rid of debt then they will feel more secure and given time will want to start spending money again. See how that works? It's always a good thing to let people keep more of their own money.

A lot of "if's" in there. Investing in the markets could cause a bubble if many of the people all at once put money into the markets. As for paying off debts, that could help in the longer term but short term would it really do much?

(06-19-2011 12:18 AM)RobertN Wrote:  As for paying off debts, that could help in the longer term but short term would it really do much?

No, it WILL pay off in the longer term. That's a good thing, right?

(06-19-2011 12:18 AM)RobertN Wrote:  

(06-18-2011 11:53 PM)miko33 Wrote:  

(06-18-2011 11:14 PM)RobertN Wrote:  

(06-18-2011 11:02 PM)Paul M Wrote:  You have 1000 people working. They pay 1000 dollar each in taxes. That's $1,000,000 in revenue. Cut taxes 5%. $950 each. Add 100 jobs. Total revenue just went up 4.5% to 1,045,000.

Not rocket science.

You are assuming that those extra jobs will be created when you cut taxes. There is no guarantee they will be created.

You're right, there is no guarantee that the extra money would be used directly to create more jobs. But what if that extra money is invested in the markets? What if regular everyday people take the extra tax savings and pay down their debts? The extra money invested in the markets will cause the markets to go up. Rising stock markets make consumers feel better because when 1) their 401k's go up in value and/or 2) their house goes up in value they feel richer and will be more willing to spend money. Also, if consumers get rid of debt then they will feel more secure and given time will want to start spending money again. See how that works? It's always a good thing to let people keep more of their own money.

A lot of "if's" in there. Investing in the markets could cause a bubble if many of the people all at once put money into the markets. As for paying off debts, that could help in the longer term but short term would it really do much?

Robert, no one can predict what the future will bring. There are no sure things in life. Your idea that raising taxes on the rich will translate into higher revenues to the gov't is a pretty big assumption itself. There is no guarantee that the rich will go along with having their taxes raised without making modifications to their behavior.

We have these "assurances" from Buffet, Gates and a few other progressive billionaires that they want to see these higher taxes. Instead of taking them on their word, look at their actions to date. Buffet has stated that he pays less in taxes than his housekeeper (or some other employee). Ask yourself why Buffet didn't correct this "injustice" on his own without calling on the gov't to force him to pay higher taxes? He could have easily told his accountants not to look for tax loopholes and voluntarily paid higher taxes. He didn't do that. Based on this, it is reasonable to assume that investors like Buffet will make a cost/benefit decision prior to investing additional money into a market. If his taxes are forced higher by the Fed Gov't, there is no assurance that he will keep his dollars in the U.S. if he can find better returns or lower tax rates. It sounds great when Buffet and those guys publicly proclaim that they favor higher taxes, but their actions clearly show that they will not pay those taxes. There are always ways around higher taxes - even if it means that capital leaves the U.S. completely to avoid those higher taxes.

Ugh, my governor. You guys can get into a lather over him, but he aint running for President. Too many skeletons "in the closet" and yes the pun is intended.

(06-19-2011 12:14 PM)aTxTIGER Wrote:  Ugh, my governor. You guys can get into a lather over him, but he aint running for President. Too many skeletons "in the closet" and yes the pun is intended.

I heard that his wife is pushing him to run.
Maybe she wants to find out the truth.

(06-19-2011 08:37 AM)miko33 Wrote:  

(06-19-2011 12:18 AM)RobertN Wrote:  

(06-18-2011 11:53 PM)miko33 Wrote:  

(06-18-2011 11:14 PM)RobertN Wrote:  

(06-18-2011 11:02 PM)Paul M Wrote:  You have 1000 people working. They pay 1000 dollar each in taxes. That's $1,000,000 in revenue. Cut taxes 5%. $950 each. Add 100 jobs. Total revenue just went up 4.5% to 1,045,000.

Not rocket science.

You are assuming that those extra jobs will be created when you cut taxes. There is no guarantee they will be created.

You're right, there is no guarantee that the extra money would be used directly to create more jobs. But what if that extra money is invested in the markets? What if regular everyday people take the extra tax savings and pay down their debts? The extra money invested in the markets will cause the markets to go up. Rising stock markets make consumers feel better because when 1) their 401k's go up in value and/or 2) their house goes up in value they feel richer and will be more willing to spend money. Also, if consumers get rid of debt then they will feel more secure and given time will want to start spending money again. See how that works? It's always a good thing to let people keep more of their own money.

A lot of "if's" in there. Investing in the markets could cause a bubble if many of the people all at once put money into the markets. As for paying off debts, that could help in the longer term but short term would it really do much?

Robert, no one can predict what the future will bring. There are no sure things in life. Your idea that raising taxes on the rich will translate into higher revenues to the gov't is a pretty big assumption itself. There is no guarantee that the rich will go along with having their taxes raised without making modifications to their behavior.

We have these "assurances" from Buffet, Gates and a few other progressive billionaires that they want to see these higher taxes. Instead of taking them on their word, look at their actions to date. Buffet has stated that he pays less in taxes than his housekeeper (or some other employee). Ask yourself why Buffet didn't correct this "injustice" on his own without calling on the gov't to force him to pay higher taxes? He could have easily told his accountants not to look for tax loopholes and voluntarily paid higher taxes. He didn't do that. Based on this, it is reasonable to assume that investors like Buffet will make a cost/benefit decision prior to investing additional money into a market. If his taxes are forced higher by the Fed Gov't, there is no assurance that he will keep his dollars in the U.S. if he can find better returns or lower tax rates. It sounds great when Buffet and those guys publicly proclaim that they favor higher taxes, but their actions clearly show that they will not pay those taxes. There are always ways around higher taxes - even if it means that capital leaves the U.S. completely to avoid those higher taxes.

Robert N, a response?

(06-20-2011 12:36 AM)Owl 69/70/75 Wrote:  

(06-19-2011 12:14 PM)aTxTIGER Wrote:  Ugh, my governor. You guys can get into a lather over him, but he aint running for President. Too many skeletons "in the closet" and yes the pun is intended.

I heard that his wife is pushing him to run.
Maybe she wants to find out the truth.

He likes his late night trips to this place...

http://www.rainon4th.com/

(06-20-2011 06:37 AM)miko33 Wrote:  

(06-19-2011 08:37 AM)miko33 Wrote:  

(06-19-2011 12:18 AM)RobertN Wrote:  

(06-18-2011 11:53 PM)miko33 Wrote:  

(06-18-2011 11:14 PM)RobertN Wrote:  You are assuming that those extra jobs will be created when you cut taxes. There is no guarantee they will be created.

You're right, there is no guarantee that the extra money would be used directly to create more jobs. But what if that extra money is invested in the markets? What if regular everyday people take the extra tax savings and pay down their debts? The extra money invested in the markets will cause the markets to go up. Rising stock markets make consumers feel better because when 1) their 401k's go up in value and/or 2) their house goes up in value they feel richer and will be more willing to spend money. Also, if consumers get rid of debt then they will feel more secure and given time will want to start spending money again. See how that works? It's always a good thing to let people keep more of their own money.

A lot of "if's" in there. Investing in the markets could cause a bubble if many of the people all at once put money into the markets. As for paying off debts, that could help in the longer term but short term would it really do much?

Robert, no one can predict what the future will bring. There are no sure things in life. Your idea that raising taxes on the rich will translate into higher revenues to the gov't is a pretty big assumption itself. There is no guarantee that the rich will go along with having their taxes raised without making modifications to their behavior.

We have these "assurances" from Buffet, Gates and a few other progressive billionaires that they want to see these higher taxes. Instead of taking them on their word, look at their actions to date. Buffet has stated that he pays less in taxes than his housekeeper (or some other employee). Ask yourself why Buffet didn't correct this "injustice" on his own without calling on the gov't to force him to pay higher taxes? He could have easily told his accountants not to look for tax loopholes and voluntarily paid higher taxes. He didn't do that. Based on this, it is reasonable to assume that investors like Buffet will make a cost/benefit decision prior to investing additional money into a market. If his taxes are forced higher by the Fed Gov't, there is no assurance that he will keep his dollars in the U.S. if he can find better returns or lower tax rates. It sounds great when Buffet and those guys publicly proclaim that they favor higher taxes, but their actions clearly show that they will not pay those taxes. There are always ways around higher taxes - even if it means that capital leaves the U.S. completely to avoid those higher taxes.

Robert N, a response?

What would you like me to respond to? THat taxing the rich doesn't guarantee more revenue? Maybe. But try getting more revenue from the poor and working poor and see how much you get. 5% of nothing is still nothing.

(06-20-2011 10:48 AM)RobertN Wrote:  

(06-20-2011 06:37 AM)miko33 Wrote:  

(06-19-2011 08:37 AM)miko33 Wrote:  

(06-19-2011 12:18 AM)RobertN Wrote:  

(06-18-2011 11:53 PM)miko33 Wrote:  You're right, there is no guarantee that the extra money would be used directly to create more jobs. But what if that extra money is invested in the markets? What if regular everyday people take the extra tax savings and pay down their debts? The extra money invested in the markets will cause the markets to go up. Rising stock markets make consumers feel better because when 1) their 401k's go up in value and/or 2) their house goes up in value they feel richer and will be more willing to spend money. Also, if consumers get rid of debt then they will feel more secure and given time will want to start spending money again. See how that works? It's always a good thing to let people keep more of their own money.

A lot of "if's" in there. Investing in the markets could cause a bubble if many of the people all at once put money into the markets. As for paying off debts, that could help in the longer term but short term would it really do much?

Robert, no one can predict what the future will bring. There are no sure things in life. Your idea that raising taxes on the rich will translate into higher revenues to the gov't is a pretty big assumption itself. There is no guarantee that the rich will go along with having their taxes raised without making modifications to their behavior.

We have these "assurances" from Buffet, Gates and a few other progressive billionaires that they want to see these higher taxes. Instead of taking them on their word, look at their actions to date. Buffet has stated that he pays less in taxes than his housekeeper (or some other employee). Ask yourself why Buffet didn't correct this "injustice" on his own without calling on the gov't to force him to pay higher taxes? He could have easily told his accountants not to look for tax loopholes and voluntarily paid higher taxes. He didn't do that. Based on this, it is reasonable to assume that investors like Buffet will make a cost/benefit decision prior to investing additional money into a market. If his taxes are forced higher by the Fed Gov't, there is no assurance that he will keep his dollars in the U.S. if he can find better returns or lower tax rates. It sounds great when Buffet and those guys publicly proclaim that they favor higher taxes, but their actions clearly show that they will not pay those taxes. There are always ways around higher taxes - even if it means that capital leaves the U.S. completely to avoid those higher taxes.

Robert N, a response?

What would you like me to respond to? THat taxing the rich doesn't guarantee more revenue? Maybe. But try getting more revenue from the poor and working poor and see how much you get. 5% of nothing is still nothing.

I'd like you to respond to my point, but OK...I see that you like to take discussions only so far and then you don't have the desire to take them to a completion. You make these claims that the gov't has a revenue problem and needs to raise taxes. I respond with points on why that strategy is not the most sound course of action. Instead of responding to my points, you prefer to restart the same discussion in an entirely new thread with your recycled views. You have done this to a number of posters in addition to me, and it shows me that you don't care to dig into the details and have a real discussion. Your last response reenforces that.