Replies to post #217553 on Zeev's Turnips Patch-No Politics (ZEEV)

[langostino]

zeev - Fed targets

I had a meeting with the former chief economist for the NY Federal Reserve last month and he made it clear the Fed really believes it can keep the real rate in a band between 1% and 2% indefinitely, forever and ever. I could not believe the hubris, but it's clear the top-level Fed officials really believe "this time it's different". They believe we now "understand" how to perfectly control the system and that the major moves of the 70s and 80s are extinct dinosaurs, never to be seen again. It was pretty stunning. But that, FWIW, is clearly what they believe.

[langostino]

zeev - I'll vote for you :-)

you have it nailed pretty much exactly the way I'd do it. damn shame you couldn't be called in. :-)

[ardent jd]

Z,

It is not so much that dividends are taxed twice, but that corporate income is taxed twice. S-corporations and LLC's are taxed only once - when income flows through to the owners. Why should publicly traded coporations be treated any differently? Yes, raise corporate rates to individual rates (and get rid of the deductions), but then eliminate all taxes on dividends and capital gains. Or raise dividend and capital gains rates to individual rates, but then eliminate all corporate taxes. The double taxation on corporate income is a great impediment to capital formation, and the fact that other countries do the same is no excuse.

On payroll taxes, somebody published a piece here within the past few days that shows that corporations really do not pay these taxes - workers do. Supposedly shifting the burden more toward companies will not accomplish anything.

On returning surpluses to taxpayers, fine. But what makes you optimistic that this will happen? As Milton Friedman said, government will spend as much as we send them in taxes, plus as much more as they can get away with. Surpluses only occur when the money rolls in faster than Congress can figure out how to spend it...and they always manage to solve this "problem" pretty quickly. I fear higher taxes will never eliminate deficits.

BTW, congrats on the amazing turnips' calls.

ardent

[ajtj99]

Nice post. I have problems with my reduced tax bills the past couple of years, and a bigger problem with the way what I am paying is being blown on homeboy security and other areas that have virtually no scrutiny in the budget process.

Seriously. I can only dream of the day when we have leaders who have the greater good on their mind instead of greasing the squeaky wheels. I wish we'd have someone in the executive branch who would not be concerned about re-election during the 1st four years and would instead do the greater good. If we liked what they were doing, why would we have to be sold or bought to validate that?

While I'm dreaming, I'd also like world peace, a pony for every child, and Viagra in our municipal water supplies.

Don't even get me into how Congress likes to mandate programs for the states and localities without providing funding, or how homeboy security funds allowed our local airport to tear down a perfectly fine existing fence and install a multi-million dollar replacement that was 2-feet taller. Like that was going to make a difference to a pair of wire cutters.