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Old 07-07-2008, 08:48 PM   #16
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Deos anyone know where we are in the research for finding a way to make coal a cleaner energy source?

Is McCain correct that the burden of health care for small businesses could kill them? Does his idea make sense to offer 5,000 a year to those who do not have health care so that small businesses do not get crushed?

Does the first year deduction of new equipment and techology make sense to help American businesses modernize?

What about the research and developmen portion? Does this make sense?
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Old 07-08-2008, 08:18 PM   #17
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Turning to economic platform talk is a great way to shut up partisan pseudo-know-it-alls because the truth is most of us don't understand anywhere near enough about economics to evaluate their likely consequences. (and I include myself in that category)
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Originally Posted by Dreadsox View Post
Deos anyone know where we are in the research for finding a way to make coal a cleaner energy source?
At least 15 years to commercial viability of clean coal plants, is the figure I've heard. The process is still very expensive, the technology is thus far much more effective at reducing sulfur emissions (good for acid rain) than carbon emissions (not so good for global warming), and even if carbon captures were drastically improved, finding a safe place to store them afterwards remains a major problem.
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Is McCain correct that the burden of health care for small businesses could kill them? Does his idea make sense to offer 5,000 a year to those who do not have health care so that small businesses do not get crushed?
$2500 per year for individuals and $5000 for families, in the form of a refundable tax credit (better have enough to get you through the year first!)--which grows at the rate of inflation, not the more-than-triple-that rate of healthcare. Well, yes, I have to imagine this would be attractive to many small business owners, because probably many younger, healthier, middle-income workers would opt for outside coverage in that case. That would drive up premiums for those who still need employer-provided insurance, though.
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Does the first year deduction of new equipment and techology make sense to help American businesses modernize?
From the businesses' POV, I'd certainly think so, but I wonder whether the government can afford an immediate-full-cost-deduction policy.
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What about the research and developmen portion? Does this make sense?
Yes, although there's nothing unique about this one; it's basically just a renewal of what already exists, and was/is part of pretty much every candidate's platform.




From the campaign's new economic policy paper, which I linked to earlier:
[q]John McCain will balance the budget by the end of his first term.[/q]
Unless we experience economic growth on a scale we haven't seen in decades, which seems most unlikely, I can't imagine how this is supposed to happen.
[q]In the long-term, the only way to keep the budget balanced is successful reform of the large spending pressures in Social Security, Medicare, and Medicaid.[/q]
OK, but other than the predictable "zero tolerance for fraud," nothing is said about what said "reforms" might look like.
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Old 07-08-2008, 08:37 PM   #18
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and for comparison's sake...


Obama's economic policy speech, also from yesterday

his new economic policy paper (.pdf) I *think* this was released yesterday too; it's shorter than his full economic platform (.pdf).

an article from the LA Times about Obama's economic platform, which unsurprisingly levels the same basic criticism being leveled at McCain's--we simply can't afford this, and most of it will wind up getting Swiss-cheesed in Congress for sure.
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Old 07-08-2008, 08:41 PM   #19
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Thanks for posting that.
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Old 07-08-2008, 08:56 PM   #20
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Quote:
Originally Posted by Dreadsox View Post
Deos anyone know where we are in the research for finding a way to make coal a cleaner energy source?

Is McCain correct that the burden of health care for small businesses could kill them? Does his idea make sense to offer 5,000 a year to those who do not have health care so that small businesses do not get crushed?

Does the first year deduction of new equipment and techology make sense to help American businesses modernize?

What about the research and developmen portion? Does this make sense?
I was at a green energy conference at the start of the year and apparently not very far, although geosequestration (pumping CO2 emissions from power plants into permeable rocks locking them away for the forseeable future) has the advantage that the means of energy production already exist, there is still a lot of the resource left and there is a big industry with vested interests in avoiding governmental restrictions.

I think that in terms of bang for buck with large scale energy production coal is one of the safer bets.
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Old 07-09-2008, 12:30 AM   #21
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Originally Posted by yolland View Post

an article from the LA Times about Obama's economic platform, which unsurprisingly levels the same basic criticism being leveled at McCain's--we simply can't afford this, and most of it will wind up getting Swiss-cheesed in Congress for sure.
I don't think that there can be a deadline to exit Iraq, and thus I don't see how a decrease in spending on the war can be counted on in a budget... however I thought this criticism seemed off..

Quote:
Obama's staff thinks that ending the Iraq war would free up money -- at least $90 billion a year -- that could be redirected to the new government programs. But it is unclear when that would occur. Obama has not given a clear date by which the Iraq war might end. On Thursday, he said he remained committed to withdrawing combat troops in 16 months. At a debate in September, he would not commit to pulling all U.S. troops out of Iraq by 2013.

Some budget experts say even a speedy end to the war would not give Obama much money for new programs.

"You cannot justify a longer-term commitment to a program based on a one-time saving on the war in Iraq," said Stuart Butler, who studies domestic policy at the Heritage Foundation, a conservative-leaning think tank.

In addition, replenishing the military and rebuilding Iraq and Afghanistan are certain to become expensive priorities once the fighting stops, said Alice Rivlin, who directed the Office of Management and Budget for several years under Clinton.

"Savings from the Iraq war will not be all that great," she said.

So, if Alice Rivlin is correct and savings from the Iraq war will not be all that great - where did the deficit come from if not from decreasing taxes?

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Also complicating his plans, Obama would inherit a budget deficit projected at more than $400 billion.
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Old 07-09-2008, 12:56 AM   #22
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There is a stark difference on how corporations will be handled.

McCain wants to lower the corporate tax rate
Quote:
http://www.johnmccain.com/Images/Iss...a/briefing.pdf
McCain Policies Will Support Reasonable Economic Growth: Small business is the key to job growth.
Small business will benefit from:
• Low individual tax rates – sole-proprietorships, partnerships, landlords and others are taxed under the
individual income tax.
• Access to capital from low tax rates on dividends and capital gains.
• Minimizing expensive mandates – such as those for health insurance and pro-union initiatives like
card check.
• Enhancing international competitiveness to keep jobs here; not abroad.
o A lower corporate tax rate.
o Improved investment and research incentives to ensure that workers have the most modern
technology.
o Bringing the budget to balance, reducing federal borrowing, and controlling spending to
reduce the burden on the economy.
As sited by Obama
Quote:
Obama's economic policy speech
Under Senator McCain’s economic plan, Exxon Mobil – a company that recently reported the biggest profit in history – would get $1.2 billion in tax breaks, while less than a quarter of the benefits would go to the middle-class. What’s worse – he has no concrete plan to pay for these tax breaks, so his policies would actually add more than $2 or $3 trillion to the national debt over the next decade and weaken our economy even further. If this sounds familiar, it’s because it’s exactly what George Bush has done for the last eight years
And Obama wants to eliminate loopholes and tax havens..
Quote:
Obama's economic policy speech The second step in my agenda is to help provide economic security for families who’ve been dealing with skyrocketing costs and stagnant wages for years. I believe it’s time to reform our tax code so that it rewards work and not just wealth. So when I’m President, I’ll shut down the corporate loopholes and tax havens, and I’ll use the money to help pay for a middle-class tax cut that will provide $1,000 of relief to 95% of workers and their families.
The thought of giving another $1.2 billion back to Exxon Mobil for their stockholders really irks me.
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Old 07-11-2008, 12:02 PM   #23
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Quote:
An argument against Obama's tax plan

By GROVER G. NORQUIST | 7/11/08 4:58 AM EST

The Tax Policy Center and the Barack Obama campaign used some sleight of hand this week in Politico. To quote Eric Tolder of the TPC, “Most small-business people, like most everyone else, are not really high-income.” While this is true, it completely and totally misses the point.

Let’s start with the definition of a “small business.” Most will tell you that small-business income constitutes income derived from sole proprietorships, partnerships and Subchapter S corporations.

The conservative argument (and that of the John McCain campaign) is that Obama’s stated plan to raise taxes on households making $250,000 or more in income is a tax increase on small business. The simple answer to this dilemma can be found in the IRS Statistics of Income Bulletin (Table 1.4, for those who are interested).

So what do the data say?

In 2006 (the latest year available), $706 billion of such income was reported to the Internal Revenue Service. Of this, about half was reported by households in the top marginal income tax rate. Interestingly, two-thirds of this income was reported by households making $250,000 per year or more — the very same households that Obama wants to increase taxes on.

The Obama campaign maintains that the number of small-business owners is what’s important. Economists know what matters is the tax rate that’s applied to the bulk of small-business income. Make no mistake about it: Obama’s plan to raise taxes on households making more than $250,000 will raise taxes on most small-business profits in America.

What type of tax rate are we talking about? Currently, S corporations face a top tax rate of 35 percent, while sole proprietors and general partners face a tax rate of 37.9 percent (since they’re responsible for paying both income tax and the Medicare component of the payroll tax).

Under Obama’s plan to let the scheduled 2011 tax rate hikes occur, and his plan to raise the self-employment tax on those making more than $250,000, the S corporation rate would rise from 35 percent to 39.6 percent. The sole proprietor and partner rate would rise from 37.9 percent all the way up to a staggering 50.3 percent. Many Democrats in Congress have proposed making all small businesses (including S corporations) pay this 50-plus percent rate. A small business tax rate that high would be the highest marginal rate faced by them in nearly a quarter-century.

What would a world look like where two-thirds of all small-business income would be taxed at a 50 percent rate? The economic law that “taxing something more and getting less of it” would apply. Fewer Americans would be interested in opening or expanding small businesses. Tax evasion and legal tax avoidance would spike, as tax shelters would once again become a booming industry. Since small businesses create a majority of jobs in America, Main Street closing up shop will have a direct impact on the family budget, as well. Plants and equipment will go unused. Despite the misguided opinions of static scorers in Washington, federal tax revenues will likely decline as the economy staggers into a full-on recession.

What’s the alternative? One place to look is the optional alternate tax system originally proposed by Congressman Paul Ryan (R-Wis.) and now endorsed by McCain. It would give households (including those with small business income) a choice between the current tax code and one with a top rate of 25 percent on all income over $100,000. This would have the beneficial effect of lowering the tax rate on most small-business income by 10 percentage points. Small businesses haven’t faced a tax rate that low in quite some time and would be likely to respond with the creation of new businesses and more investment in existing businesses.

The McCain small business tax plan doesn’t end there. For those businesses that are organized as conventional corporations, the top tax rate would fall from 35 percent to 25 percent, the European average. For all businesses, technology and equipment — which now must be slowly “depreciated” over many years — would be immediately expensed in year one.

Stepping back, voters and policymakers should ask themselves whether they want two-thirds of small business income taxed at a 50 percent tax rate or if they want nearly all small-business income taxed at a 25 percent tax rate. They should ask themselves whether it’s healthier for small businesses to write off a computer over six calendar years or to simply write it off in year one. To America’s small business sector, the answer is obvious.
An argument against Obama's tax plan - Grover G. Norquist - Politico.com
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Old 07-11-2008, 03:42 PM   #24
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Incidentally, this is the article from Politico that Norquist was referring to:
Quote:
According to the Treasury Department, nearly 78% of taxpayers report some business income. But those numbers go far beyond just those running their own businesses. The Treasury is counting a huge number of people including anyone who offers space for rent; reports income from consulting, freelancing or speeches; or who works in a partnership, a structure used by many law firms, accounting houses and hedge fund managers.

According to the Tax Policy Center, only 1.4% of people defined by the Treasury as small-business owners are in the top two tax brackets and could be subject to Obama’s tax proposal. In fact, under the Treasury definition, both John and Cindy McCain qualify as small-business owners. John McCain reported more than $88,000 of business income from his book sales, according to his 2007 tax returns, a small percentage of his total $405,409 income. And his wife recorded more than $4.5 million of her roughly $6 million total income as business-related in 2006.


Quote:
TIME - Grover Norquist's Fuzzy Math

Grover Norquist today comes up with a somewhat baffling defense of Carly Fiorina’s claim that 23 million small businesses would see tax hikes under Obama’s tax plan. Grover argues this: "In 2006 (the latest year available), $706 billion of such income was reported to the Internal Revenue Service. Of this, about half was reported by households in the top marginal income tax rate. Interestingly, two-thirds of this income was reported by households making $250,000 per year or more--the very same households that Obama wants to increase taxes on."

Using this argument to say most small businesses would see a tax increase is disingenuous. Grover’s right in saying that there are many “small businesses” who make a LOT of money (remember, Tiger Woods falls into this category). Small businesses are generally considered three groups: sole proprietors (schedule C), sub chapter S and partnerships. Most people think of partnerships are mom and pop running a soda shop. But in America, partnerships also include private equity groups and hedge funds--so Jamie Simons who made $1.7 billion last year is actually considered a small business.

In 2006 only 2.6 million households filed tax returns in the highest two brackets taxed at 33% and 35%--it is impossible to say, therefore, that 23 million small businesses are going to get taxed at a higher rate. It is irrefutable that in terms of sheer numbers only a few hundred thousand of the 23 million small businesses make more than $250,000 a year--and those few hundred thousand make the bulk of profits earned by “small businesses” last year (I'd bet most of them have a NYC zip code). All Grover is doing here is telling us that there’s huge income disparity among small businesses as there is among all Americans. Yes, two-thirds of small business income would see a tax hike under Obama: but the vast, vast majority of those few hundred thousand hedge fund magnets and golf stars can afford it (and, ironically, many of them would actually get taxed at a lower rate because of carried interest, but that’s another debate).
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Old 07-11-2008, 05:43 PM   #25
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Incidentally, this is the article from Politico that Norquist was referring to:
Good points, I thought I had found something I did not like about Obama's tax policy.
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