Biden pushes massive tax hike on workers as recession begins

  

Category:  News & Politics

Via:  gregtx  •  2 months ago  •  35 comments

By:   Brad Polumbo

Biden pushes massive tax hike on workers as recession begins
The best way to revive an economy as you head into a recession is to slap businesses and workers with a massive tax hike. Said no legitimate economist ever.

S E E D E D   C O N T E N T



July 30, 2022 06:00 AM By Brad Polumbo

The best way to revive an economy as you head into a recession is to slap businesses and workers with a massive tax hike. Said no legitimate economist ever.

Yet that's apparently the best plan President Joe Biden and Democrats in Congress can come up with. Their new so-called "Inflation Reduction Act," which would do almost nothing to reduce inflation , also includes a $315 billion tax on businesses. This comes in the form of a 15% "minimum corporate tax" applied to major U.S. corporations.

Biden says that this tax will allow him to spend huge sums on green energy subsidies and tax credits and "pay for all of this by requiring big corporations to pay their fair share of taxes, with no tax increases at all for families making under $400,000 a year."

Yeah, right.

While this may be literally true in the sense that Biden will levy the tax on corporations, in reality, it will burden everyday people the most. Most economists agree that much of the true burden of corporate taxes is borne by workers through lower wages. There's some dispute about exactly what percentage is ultimately absorbed by workers, but even the most favorable, left-leaning analyses acknowledge that it's a significant chunk. Meanwhile, most research says it's the majority!

As I previously summarized :

"William C. Randolph of the Congressional Budget Office found that for every dollar raised by the corporate tax, approximately 70 cents comes out of workers' wages. Further confirming this finding, research from the Kansas City Federal Reserve concluded that a 10% increase in corporate taxes reduces wages by 7%."

So, Biden's plan to squeeze $315 billion more out of corporations actually means squeezing hundreds of billions out of workers — at the exact time we can least afford it.

Not only are families suffering under the crushing weight of inflation, but we also just crossed into a second consecutive quarter of a shrinking economy, which despite the White House's attempted gaslighting, remains the conventional definition of a recession. (It is even used as the definition in several federal laws .) Raising taxes on businesses and workers is hardly ever a good idea, but in our current situation, it would be a gut punch to the productive sector at the worst possible time.

Tax Foundation Vice President of Federal Tax & Economic Policy William McBride warns that this tax increase would "reduce incentives for … companies to invest, grow, hire, and raise wages."

He adds that in our current economic situation, "it would be extremely unwise to raise taxes, especially the type of taxes advocated by this administration, which would do excessive harm to the economy."

Indeed, it would. If Biden has any sense left in him, he'll heed this warning. But more realistically, swing-vote Sen. Kyrsten Sinema may now be our only hope of killing this terrible bill and sparing the public more economic suffering.


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GregTx
Junior Participates
1  seeder  GregTx    2 months ago
The elementary fact is that “business” does not and cannot pay taxes. Only people can pay taxes. Corporate officials may sign the check, but the money that they forward to Internal Revenue comes from the corporation’s employees, customers or stockholders.

Milton Friedman

 
 
 
Jasper2529
Professor Participates
2  Jasper2529    2 months ago
Biden  says  that this tax will allow him to spend huge sums on green energy subsidies 

Translation:  The Green New Deal.

The hell with lower worker wages and higher prices for goods and services.

 
 
 
Nerm_L
Professor Principal
3  Nerm_L    2 months ago

The current corporate tax rate is 21 pct.  So, at least in theory, a minimum tax of 15 pct shouldn't affect businesses.  But few of us are naive enough to believe the tax code is applied fairly or that businesses don't game the system to cheat consumers.   The sheer number of corporate lawyers should tell us that cheating consumers is part of most business models.

Yes, it's true that consumers provide the money to pay those corporate taxes.  And it's also true that businesses cap wages to limit the impact on consumer prices.  But that doesn't change the fact that consumers provide the money to pay for business operations, wages, taxes, bonuses, and stock dividends.

Consumers are the magic money tree in the economy.  And trying to squeeze more money out of that magic money tree during a time of economic stress is never a good idea.  It doesn't matter if the government, corporate lawyers, flimflam financial wizards, or business friendly politicians are doing the squeezing.

 
 
 
Ronin2
Professor Quiet
4  Ronin2    2 months ago

The Human Fuck Up Machine rides again; and brings the rest of the Democrat Party with him.

They must feel they have nothing left to lose and might as well throw the US in the rest of the way into the shitter before they lose control in Congress. 

 
 
 
Thrawn 31
Professor Guide
4.1  Thrawn 31  replied to  Ronin2 @4    2 months ago

Still better than Trump.

 
 
 
Ronin2
Professor Quiet
4.1.1  Ronin2  replied to  Thrawn 31 @4.1    2 months ago

Name one thing the Human Fuck Up Machine has done better than Trump- other than screw US citizens over.

 
 
 
Sparty On
Professor Principal
4.1.2  Sparty On  replied to  Thrawn 31 @4.1    2 months ago

One wonders where the ignorance at play in that comment comes from.

Record high inflation, record high food prices, record high gas prices, etc,etc.   And he is just as insulting.    More even.    He just insults a different group of people.

He has continued his unblemished record of fucking things up for nearly 50 years now.    

So better how?

 
 
 
Thrawn 31
Professor Guide
4.1.3  Thrawn 31  replied to  Ronin2 @4.1.1    2 months ago

He isn’t Trump. 

 
 
 
Thrawn 31
Professor Guide
4.1.4  Thrawn 31  replied to  Sparty On @4.1.2    2 months ago

One wonders if one is a moron. Biden is not Trump, that’s it. Trump would end our form of governance, I voted for “not that”. 

Not a lot of wondering too be done unless you are retarded. 

 
 
 
Sparty On
Professor Principal
4.1.5  Sparty On  replied to  Thrawn 31 @4.1.4    2 months ago

Stop projecting now and get serious.

 
 
 
Sparty On
Professor Principal
4.1.6  Sparty On  replied to  Thrawn 31 @4.1.3    2 months ago

A classic case of TDS.    A pretty serious one at that.

 
 
 
bugsy
Professor Participates
4.1.7  bugsy  replied to  Thrawn 31 @4.1.3    2 months ago
He isn’t Trump. 

And that is the ONLY reason why piece of shit is in the WH today.

We see that you can't answer 4.1.1.

Let me answer it for you, as this is probably another reason why you voted for Biden......

No more mean tweets.

 
 
 
Texan1211
Professor Principal
4.1.8  Texan1211  replied to  Thrawn 31 @4.1    2 months ago
Still better than Trump.

Wow, such a sterling endorsement of Biden!

LMAO!

You KNOW you have a losing hand when the very best you can do is play the Trump deflection card! 

 
 
 
Drinker of the Wry
Freshman Principal
5  Drinker of the Wry    2 months ago

Naming this the Inflation Reduction Act is Orwellian.  Raising taxes to by down the debt might help inflation, but raising taxes to spend more fuels inflation. 

A few days ago, the CBO released it's latest forecast, without this bill, federal spending will reach 23.5%of GDP this year and grow to 24.3 percent over the next 10 years, that's WWII levels.  Tax total revenue has averaged 17.3% over the last 50 years, Before this bill, tax revenue is expected to reach 19.6%  of GDP this year.

 
 
 
Sparty On
Professor Principal
5.1  Sparty On  replied to  Drinker of the Wry @5    2 months ago
Naming this the Inflation Reduction Act is Orwellian.

Spot on

 
 
 
squiggy
Sophomore Quiet
6  squiggy    2 months ago

"...for families making under $400,000 a year."

That's good - sparing the little guy.

 
 
 
Sparty On
Professor Principal
6.1  Sparty On  replied to  squiggy @6    2 months ago

You mean the little guy who today has to choose between food and gas?

 
 
 
Snuffy
Masters Guide
6.2  Snuffy  replied to  squiggy @6    2 months ago
"...for families making under $400,000 a year." That's good - sparing the little guy.

Except it's becoming more clear that this was just another lie from a politician.  

"This bill will not raise taxes on anyone making less than $400,000 a year," Biden remarked Thursday during a speech about the legislation. "And I promise — a promise I made during the campaign and one which that I ha- — that I’ve have kept."

In 2023, the year in which the legislation would increase tax revenue most, individuals making less than $10,000 per year would pay 3.1% more in taxes and those making between $20,000-30,000 per year would see a 1.1% tax increase, the JCT analysis showed. Tax revenue collected from those making $100,000 per year or less would increase by $5.8 billion in 2023   under the Inflation Reduction Act .

In addition, the share of tax revenue collected from all Americans making more than $200,000 per year would remain at the current percentage, according to the JCT.

"There's a $25 billion crude oil tax in this bill," he added. "That's something that's going to hit everyone. That's a regressive tax increase on poor people that raises their energy costs, raises the price of gasoline."

 
 
 
Sparty On
Professor Principal
7  Sparty On    2 months ago

We need opposite Joe.

He needs to decide what he wants to do and then do the total opposite.

We’d be golden then.

 
 
 
GregTx
Junior Participates
7.1  seeder  GregTx  replied to  Sparty On @7    2 months ago

I think he would still fuck that up..

 
 
 
arkpdx
Professor Participates
7.1.1  arkpdx  replied to  GregTx @7.1    2 months ago

To quite what we used to say about some people 

" Biden could fuck up a wet dream!"

 
 
 
Thrawn 31
Professor Guide
8  Thrawn 31    2 months ago

Pretty sure companies with 1 billion + profits can afford it. 

 
 
 
Ronin2
Professor Quiet
8.1  Ronin2  replied to  Thrawn 31 @8    2 months ago

Pretty sure the costs of the taxes will be passed along to their workers in the form of lower wages, reduced workforce, and the customers with increased prices.

"Businesses don't pay taxes" remember?

 
 
 
Thrawn 31
Professor Guide
8.1.1  Thrawn 31  replied to  Ronin2 @8.1    2 months ago

Lol so it will be more of the same then? 

Honestly it never ceases to amaze me when I watch people that will NEVER get a taste of that life fight tooth and nail to defend the pricks born into it, to their own detriment. 

I just… I just don’t get it.

 
 
 
bugsy
Professor Participates
8.1.2  bugsy  replied to  Thrawn 31 @8.1.1    2 months ago
I just don’t get it.

Of course you don't.

Liberals are groomed to hate anyone that is successful in life. That includes those that started their own small business, spent thousands of their own money to get it going and countless hours to ensure its success.

 
 
 
Thrawn 31
Professor Guide
8.1.3  Thrawn 31  replied to  bugsy @8.1.2    2 months ago

Damn, I hate myself? Fuck…

And bugsy, you are obviously NOT one of the people I was talking about and I know for a fact that you do not run a 1 billion dollar business so quit your senseless bitching. 

Lol the fucking hubris to think that you are even slightly on congress’s radar with this legislation…

 
 
 
Drinker of the Wry
Freshman Principal
8.1.4  Drinker of the Wry  replied to  bugsy @8.1.2    2 months ago
That includes those that started their own small business, spent thousands of their own money to get it going and countless hours to ensure its success.

That's because they know that "if you’ve got a business — you didn’t build that. Somebody else made that happen."

 
 
 
bugsy
Professor Participates
8.1.5  bugsy  replied to  Thrawn 31 @8.1.3    2 months ago
I know for a fact that you do not run a 1 billion dollar business so quit your senseless bitching. 

Hilarious.

This coming from the guy who claimed to spend time in the military as a "combat veteran", but couldn't say where he served.

You mean nothing to me.

 
 
 
squiggy
Sophomore Quiet
8.2  squiggy  replied to  Thrawn 31 @8    2 months ago

They can afford lawyers and accountants to avoid taxes.

 
 
 
Thrawn 31
Professor Guide
8.2.1  Thrawn 31  replied to  squiggy @8.2    2 months ago

So more of the same. Still not getting what all the bitching and moaning is about.

 
 
 
Hallux
Junior Principal
8.2.2  Hallux  replied to  Thrawn 31 @8.2.1    2 months ago

The culture wars are running out of steam.

 
 
 
GregTx
Junior Participates
8.2.3  seeder  GregTx  replied to  Hallux @8.2.2    2 months ago

The Democrats better hope not, there’s nothing else really for them to run on.

 
 
 
Hallux
Junior Principal
9  Hallux    2 months ago

Oh no, are the peas touching your carrots? Different Admin same 4 year old schtick ...

 
 
 
GregTx
Junior Participates
9.1  seeder  GregTx  replied to  Hallux @9    2 months ago

I’m not sure what this means but…. thanks for your comment.

 
 
 
Sparty On
Professor Principal
10  Sparty On    2 months ago

No worries, like inflation about a year ago, it’s only transitionary.

Everything is going to be great.    I mean look how much gas has gone down from its peak.jrSmiley_88_smiley_image.gif

Next is when inflation drops a point or two, Biden will be tooting his horn again and his worker drones will be eating that BS up with a spoon.

The idiocy strikes again. .....

 
 

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