GE make $5 billion in profits (in 2010, in the US alone) and pay no taxes

mrbigbluelight

One point I'd like to make, DK, about one statement:

"the differences between socialism and capitalism are in who owns the means of production. "

I would agree with that definition between the two systems.
That would, however, lead me to this question:

What do we call the system we have ?
It may seem like splitting hairs or sea-lawyering but, IMO, nobody owns anything in this country, whether they are a private person or corporate entity.

A citizen may have all his personal and real estate property paid off.
Is it his ? IMO, no.
Failure to pay taxes on those items will result in seizure by the State. The net effect is that we "lease" from the State.
A retired person who retires to paid-off property and is able to live entirely off the land will find he is not truly free and owns nothing if he can not produce money to pay his taxes.

Likewise for a corporation.
A corporation that fails to pay XYZ tax(es) would eventually have its assets seized by the State.
The corporation is merely allowed to operate the means of production; the true ownership is the State, IMO.

An example, I believe , of this real world would be the recent GM bailout.
The operators (CEO, etc) of the means of production at that time were failing to operate in a successful manner. The true owner, the State, stepped in and said,

"We are not happy with the people who are presently operating what We own. We will remove those operators (CEO, etc) and put in place people We choose. We will tell the sub-operators (line people) how We will allow them to be paid and what benefits We will allow them to have. We will give money that We will demand back".

What we have, perhaps IMO, is a "consumerist society.

A "consumerist" society would be one where a person/corporation may be allowed to operate the means of production but not truly own it.
Final ownership is reserved to the State.

Not assigning blame.
Not assigning praise.
Not saying this is good.
Not saying it is bad.
Just saying what IS, IMO.

mrbigbluelight

DK wrote:

Corruption and abuse? Name one social or economic system devised by man that has not had elements of corruption or abuse.

There are none, because they all involve humans.

If possible, a benign, benevolent, well-informed dictatorship would be "nice", but that isn't going to happen because the "good" dictator would have to be ...... human.

If the pendulum swings too far one way, it goes to the level of a "corporate democracy"; the corporation is "king".
This didn't work too well in the 30's.
Mink stoles were tax deductible while Grandma died of starvation.

If the pendulum swings too far the other way, it turns into a "socialist democracy". The people are "king" and the corporations are cows to be bled dry.
Wind up with a system of no incentive to excel, to work, to produce.
Soviet Union was a good example of that. Can't remember the name of their POS car (Lamda ? Ladyda ?). Poor design, poor manufacturing, poor everything because "What's the Use ?".

DarqueKnight

mrbigbluelight wrote: »

A citizen may have all his personal and real estate property paid off.
Is it his ? IMO, no.
Failure to pay taxes on those items will result in seizure by the State. The net effect is that we "lease" from the State.

mrbigbluelight wrote: »

A corporation that fails to pay XYZ tax(es) would eventually have its assets seized by the State.
The corporation is merely allowed to operate the means of production; the true ownership is the State, IMO.

An example, I believe, of this real world would be the recent GM bailout.

Property seizure for non-payment of taxes comes at the end of a long, drawn out process. Corporate bailouts come as a last resort measure to avert a bigger catastrophe that would occur if the corporation crashed and burned. Your examples are not evidence of all property actually being owned by the state. They are examples of the state's ability, delegated by the people, to enforce laws and exact penalties. Along your same line of reasoning, none of us actually have any personal freedom because the state can incarcerate us for non-payment of personal income tax.

You can always find extreme examples that are contrary to the norm. Corporate bailouts and property seizures are not the norm. Putting people in jail for non-payment of taxes is also not the norm. However, if you break the law, then a penalty will accrue.

In addition to the extreme examples you cited, there is also the concept of "eminent domain", where a government entity can force the sale of private property under certain conditions. The government must offer at least fair market value for the property and often offers above market value. Sometimes relocation assistance is offered if the property being purchased is a citizen's residence. In some cases, private property has been purchased under eminent domain and then the government decided not to use the property. Sometimes in such cases, the owners were allowed to repurchase the property at below market value, yet while keeping the above market value original payment. Three of my family members experienced such a windfall through eminent domain transactions.

cokewithvanilla

I don't know why the system is so complicated. Maybe I am financially stupid, but why can't we simply tear the whole thing down and just use the basics? Why not just lower the tax rate and remove all deductions and bs? Tax = % of profit... simple... nothing more/less. Tax a lower %, but have everyone pay the full amount. You have a wife and kids, what, eff you those were your decisions.. no deduction.... oh you donated to such and such a charity... again, your fault. sorry, no deduction.

With the current system, people who cannot afford to pay someone to find them loopholes end up paying more, while those that can afford it pay their money to accounting firms instead of the government. The longer the legislation is, the more chance someone will find a loophole. if you have a 2 sentence income tax law, it doesn't leave much room for error


they can do away with tax brackets too... you make 10,000, you get taxed 1000.. you make 1,000,000 you get taxed 100k. I don't understand why people say a flat tax benefits the rich.... 10% is 10% is 10%.. how can anyone see taxing someone a greater percent of their income for succeeding as fair? the rich dude who makes over a mil a year isn't using the roads any more than the poor person ... he's probably actually less of a financial burden to the system than the poor people.

cnh

Both DK and myself have addressed why someone making 10 million who pays 1 million in taxes and a family that makes 40K and is taxed 4K are not equal in real world terms, i.e., in terms of the economic ''burden" each faces in real income.

See above. Of course they are equal 'mathematically' but struggling to survive on 36k, while cruising in a mansion with several vintage vehicles and a driver are not a matter of simple math problem that any elementary school kid could calculate.

They're a function of real knowledge and experience of living at different 'levels' of our society.

John's flat tax proposal above, is a little better than a strict FLAT tax because it contains some awareness of the need for a slightly 'graduated' function for low vs. very high incomes.

When you're barely able to make your car payments and your tax rate is the same as someone who could buy you and your neighbors several times over. That rate is NOT the same.

cnh

nooshinjohn

nooshinjohn wrote: »

This...

The way a flat tax has been proposed is that all income up to 25k would be free from any taxation. Income above that would be taxed at 10% up to 250k and all income above that would be at 15%. Such rates would then be set in stone, so to speak, needing a 2/3rds magority vote and/or a declaration of war to increase. A similar plan for corporate earnings would be something like up to 250k tax free, 250k to 5mil at 10% and everything above 5mill would be taxed at 15 to 18%, with no penalties for "repatriation" of income earned from outside the U.S. There would be no need to file taxes, find deductions or loopholes, or look into off-shore accounting firms to hide your cash.

The beauty of such a plan is the rates above would provide enough funding to the government to fund all current programs and liabilities(Obamacare excluded), and takes into account the needs of those that are at the bottom end of our economic system.

Were you refering to this cnh?

Tour2ma

Tour2ma wrote: »

I chose the wrong synonym...

Too late for an edit, but I meant homonym...
which apparently has evolved to synonym status with the technically correct term, homophone...
which I'd never heard of...

Carry on...

tonyb

I was obviously argueing both sides of the fence, to draw some into discussion. From my point of view, all I got was intellectual conversation on the merits of privilege and crony capitalism.
Since taxing the poor is a no no, raising taxes on the middle class is too much of a burden for them, and raising taxes on the rich will stifle growth, who then do you raise taxes on ?
The whole point of raising taxes is to bring in revenue, and that revenue is used to sustain a certain level of services,and spending. Unfortunately, we always look to the side of raising the revenue stream without consideration to the spending side. Cutting 60 billion in spending in comparison to our long term debt is like dropping a nickel down a sewer. Yet we can't even get that much cut from our budget. When both sides can't agree on spending cuts, there's only one other alternative,raise taxes. Who do you think will be the target ?
One can argue that no matter what the tax burden is to corporate america, at least part of that cost is passed on to the end consumer, the average joe. Which is how a free market works in general. My problem comes in when corporate america can use the average joe's coin to enrich themselves. Imagine if the middle class could dip into corporate profits to cover losses from bad decisions they made. In some cases they do. Look no further than the housing and mortgage situation. If you can remove the cronyism out of the equation, the lobbyist, the coin filtering back to those who make the rules, then a flat tax is some fashion, makes sense.

slk55amg

I was advised some 50 post,s ago, I was venturing into a dangerous area ,in regard to this issue. Being new here I did not add anything from that point foward, it seems I was the only one to do so................

Jstas

slk55amg wrote: »

I was advised some 50 post,s ago, I was venturing into a dangerous area ,in regard to this issue. Being new here I did not add anything from that point foward, it seems I was the only one to do so................

It's like your mom tells ya, if all your friends jump off a bridge, does it make it right if you do it too?

I used to get embroiled in these "debates" as well. If you can call them that. All it gets you is a bunch of butthurt people who still don't see eye to eye, a massive forum war that alienates n00bs and people who incessantly troll each other over silliness which alienates even more people. Have you noticed how much the post rate drops when everybody's panties are in a bunch and they are at each others throats? It's easier to just tell the yahoos to 'eff off and stay out of it. That's about all you end up with in the end anyway. Getting involved just gets you stress, punishment from the establishment and alienation from your peers as your cost to get you the same damn thing as you get if you just stay out of it and all that costs you is one less mouse click on the thread.

slk55amg

makes perefcts sense to me, thanks

warren

tonyb wrote: »

Beck has nothing to do with this thread guys, leave well enough alone.

DK,
First, let me say I appreciate the civil debate, love it, thank you. Secondly, I know it's the internet and all, so some of my comments and yours don't translate well,leading to somewhat of a misunderstanding in certain area's on both our parts. Maybe someday if we ever hook up, we'll thrash it around some more beyond this thread.
That said, I must admit I'm having a hard time deciding which side your on, more taxes on the rich, or less. I have a feeling, just a hunch mind you, that if G.E. paid 300 million more in taxes, it wouldn't hurt them an inch. Considering the example you threw out, the guy who would pay 333 bucks more, how about if you could lower his tax burden by the same ? Would you be cool with that? Seeing that part of that guys income goes towards tax breaks for G.E., maybe if GE paid more, he'd pay less. In theory of coarse, because once that extra coin hits Washington, it's spent. I'm still having a rough time with the logic that a big corp offers society other benefits and wealth is deserving of certain priveledges, as you say. Does wealth give you the priveledge to stick your hand in the taxpayer cookie jar ? Or are you breaking it down into a class warfare type of thing ? Not sure how to interpret some of your replys so just asking for some clarity.
Again, I appreciate the debate, along with others who can keep it on the up and up.

I have a feeling, just a hunch mind you, that if G.E. paid 300 million more in taxes, it wouldn't hurt them an inch. Considering the example you threw out, the guy who would pay 333 bucks more, how about if you could lower his tax burden by the same ?
I'll pay my share, GE pays theirs... I'm a happy camper with a beer in each hand...

BlueFox

What I wonder about is if GE didn't have to pay taxes due to a loss, then how did they make $5 billion in profits?

Profit = Revenue - Expense

A loss is when the expense is higher than the revenue.

mrbigbluelight

Jouse reported