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  1. #101
    IncGamers Member Goryani's Avatar
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    Re: Romney and Bain?

    Quote Originally Posted by KillerAim View Post
    Please explain why retirees in Florida and Stevinator’s grandmother should be concerned about Ryan’s plan when they are specifically excluded from being affected by the plan? His changes only applies to who are born in 1956 or later.
    History explains that it happens. The reason why is that the people responsible for the ad adhered to your application of property rights with respect to nutritional labels: they placed ads which were legal though not truthful. The burden of adjudication was placed on the uninformed majority, who got it wrong in the end (as per usual). Come election time, seniors were worried how they were going to pay for expenses they were exempt from. Advertising doesn't have to lie to order to lie. Merely hiding pertinent facts is sufficient to perpetrate a fraud.

    Quote Originally Posted by KillerAim View Post

    1. Capital Gains are paid on dividends and gains on sales of capital.
    2. Dividends are directly linked to company’s Net Income, while capital gains on sales are indirectly linked to Net Income. (You usually make a gain on a sale if the company is more valuable than at the time of your purchase. The increase in the projected value almost always comes from an increase in expected earnings.)
    3. The corporate tax rate on net income equals 35%.
    4. Therefore, Romney and all others (anyone invested in a pension plan, 401k plan, etc.) have already had 35% in taxes deducted from their revenue.
    5. Now, Capital Gains Tax Rates vary from 0% in special cases (regular income plus capital gains still leaves you in the 0% to 15% regular income tax rate category), to the normal 10% to 35% (from low income, long term gains to high income, short term gains).
    6. Therefore, all earners of capital gains have had those earnings taxed at a rate from 35% to 58%.
    That's not a very good description of the process as it's practiced in real world situations.

    Effective corporate tax rates are lower than 35%.

    Compare the income tax expense with net profit as reported to shareholders. A true 35% tax rate would result in $35 in taxes for every $65 of net income to shareholders: a 53.8 ratio. A look at SEC filings shows different ratios.

    Microsoft's ratio ranges from .213 to .333. It's an effective tax rate of 17% to 25%. BP (of oil spill fame) has an effective tax rate of around 27% when it makes a profit and around 25% when you combine multi-year window averages. GE is a loophole finding machine. In 2009, it's effective tax rate was -10%. Yes, it had a negative tax rate despite over $11 billion in US revenues. That tax revenue paid for the corporate taxes GE owed to foreign governments. For 2010, the effective tax rate was around 7-8% and for 2011 it was around 28%. Walmart is at a pretty steady 32% effective tax rate.

    What about some Bain Capital affiliated companies?

    HCA's annual effective tax rate was just over 30% in 2009 and is currently at 24%. Burger King Holdings 2011 tax rate was 27%. Clear Channel Media 2011 tax rate was a negative number, but they also lost money during the same period. Domino's Pizza is in the 36% to 41% tax range - I'm really curious why it's so high. Dunkin' Donuts are clearly doing some accounting voodoo. Their tax rates vary from a low of -30% to nearly 100% (probably as a result of past and current tax fraud investigations and settlements).

    Also, corporate tax rates are not a flat 35%. The tax rate for corporations vary from 15% to 35%, though any profits in the 6+ figure range have an on-paper tax rate in the 30s.

    Corporations receive numerous tax benefits not available to individuals.

    Corporations are only taxed on profits, not income (revenue). Just for comparison, Microsoft's 2011 tax rate of 24% would be considered an effective income tax rate of 9.4% according to IRS Form 1040. And that's from a high profit margin company. BP would have a 2011 effective tax rate of 3.3%. Walmart would have an effective tax rate of 1.8%. I wonder if Romney's private jet is paid for by Romney or by one of his corporations. Same thing with cars. Houses. Lawyer. Accountant. Vacations. Clothing. Insurance. With enough corporations involved, very few day to day expenses can't be expensed to one of them. In essence, most of the goods and services bought by the uber rich are a tax deductible expense on one corporation or another.

    Corporations have this nifty benefit called loss carryback and loss carryforward. Losing money one year reduces tax liability or previous years and in later years. All kinds of accounting shenanigans occur to maximize this benefit. A company can have a real net income but still show a net loss on paper. Alternating years of loss and profit (reminder - purely on paper) really help take advantage of other tax breaks found in the over 10,000 pages of the tax code.

    To borrow from a popular meme: It's the deductions stupid.

    Tax rate, by itself, is a useless barometer for these discussions. There are no rates without deductions. Deductions alter the final outcome as much as, and often more than, the initial rate. Income tax rates for highest earners are supposed to be 35%. However, if that income can be classified as a source listed on schedule D, the tax rate is reduced from 35% to 15% (and sometimes even less). What would the tax rates of point 6 look like without deductions for capital gain income? Different. Very very different.

    I like this line from the 2012 corporate tax instructions:

    "The fact that a corporation has an unreasonable accumulation of earnings is sufficient to establish liability for the accumulated earnings tax unless the corporation can show the earnings were not accumulated to allow its individual shareholders to avoid income tax."

    Corporations whose profits stem from investing in other companies (hello Bain Capital) avoid that clause simply by investing the "unreasonable accumulation of earnings" into another company. Ergo, current tax law allows individual shareholders to avoid income tax merely by the existence of a corporation acting on the individual's behalf. I'm not going to claim that Romney and Bain engaged in this behavior, but such behavior is possible (and sometimes legal) under the current tax code.

    Throw out misleading numbers like 35% tax rates. Use actual tax rates. What's Romney and/or Bain's actual tax rate? According to the Romney campaign, his tax rate for 2010 was 13.9%. How does that happen if the lowest tax rate is supposed to be 15%? Answer: published tax rates are irrelevant.

    Maybe later we can talk about how part of Romney's $21.6m 2010 revenue is derived by companies which paid no corporate income taxes because they didn't show a profit. If there is no first dip, there is no such thing as double dipping. Tax laws enacted to avoid double dipping shouldn't come into play without the first dip. After that, we can talk about triple dipping (dividends received decuction) that isn't.

    Quote Originally Posted by KillerAim View Post
    Does your family make your 90 year old Grandmother fill out and pay her own taxes? Does your family force her to handle, on her own, all of the responsibilities involved in living in the modern world (paying bills, handling repairs around the house or negotiating with service companies to take care of the repairs, cooking, cleaning, and yard work)? If not, then why are you arguing that Seniors will be forced to make such decisions without any help from family, friends, or advisors?
    90 year old grandmothers are children of the depression. I can't help my grandfather with those activities because he refuse to let anyone else help make those decisions. It's a cultural issue. Revoking his driver's license involved breaking and entering and grand theft auto. Despite decades of type 2 diabetes and the resulting nearly complete numbness from the waist down, he stopped driving only when his children took the car and car keys.

    The point though, is that many people don't want to have to make a decision on vouchers. If given a choice between vouchers and letting someone else worry about the problem at a later time, which side do you think will win? Receiving a gift (benefits of a governmnet program) of suffering the loss of theft (balancing the budget) trigger emotional responses strong enough to override rational thought more often than not, when considered on a national level.




  2. #102
    IncGamers Member BobCox2's Avatar
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    Re: Romney and Bain?

    European Socialists are thieves traditionally...

    From Robin Hood on up.



  3. #103
    IncGamers Member BobCox2's Avatar
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    Re: Romney and Bain?

    The Bain Files: The Documents


    Gawker has obtained a large cache of confidential internal financial documents from more than 20 secretive hedge funds and other investment vehicles in which Mitt Romney has stashed his considerable wealth. All told, the partnerships and limited liability corporations detailed below accounted for, at minimum, $10,069,000 of Romney's assets in 2011 and yielded $913,300 in income, according to his 2012 financial disclosure (those figures are derived from adding up the low end of ranges Romney disclosed; the actual numbers could be astronomically higher).

    Most of the entities are affiliated in one way or another with Bain Capital, the private equity firm Romney ran from 1984 through 1999. According to his financial disclosures, the investments "were made pursuant to an agreement with Bain Capital regarding Romney's retirement.... The agreement has expired but [Romney] retain[s] certain investments...made prior to the expiration of the agreement." In other words, they are his retirement package from more than a decade ago, and continue to make him nearly a million (at minimum) dollars per year.

    For a look at what we've been able to glean thus far from the documents—including Romney's unlikely relationship with the National Enquirer and how his money managers praised the economic stimulus he publicly derided—go here. But by all means peruse the documents yourself and lend your expertise to what they mean in the discussion.

    All of the documents linked below are also available in a searchable format here, via Document Cloud.



  4. #104
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    Re: Romney and Bain?

    I find it weird how the morons of society always wants to get rid of things that help them; like socialized medicine. America currently pays more than any other country for healthcare, has a much greater wealth disparity (rich people holding more money), and is one of the few civilized countries in the world without universal healthcare.

    Things like Universal healthcare are what are known as a progressive tax, America has a ton of money and is still the richest country in the world, the reason average people are doing so crappy is because of your clawing back of anything progressive that would inevitably help your middle/poor class. The money slowly funnels upwards as rich people are taxed less and poor people are taxed more, generations of regressive taxation means your middle class slowly dissipates. So say yes to progressive tax systems, say yes to universal healthcare, say yes to anything which takes from the rich and gives to the poor, at least until you have a good balance of rich to poor and your demand for products kicks up again and the wealthy arent just sitting on their money. If your going to wait for "trickle down" economics to work your going to be waiting a long *** time, rich people wont blow through that much money any time fast.


    Last edited by Turnip; 24-08-2012 at 05:36.

  5. #105

    Re: Romney and Bain?

    Quote Originally Posted by Turnip View Post
    I find it weird how the morons of society always wants to get rid of things that help them
    Breaking into my neighbor's house and stealing all their valuables would "help me" too. Does that mean I should do it?



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  6. #106
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    Re: Romney and Bain?

    Quote Originally Posted by SaroDarksbane View Post
    Breaking into my neighbor's house and stealing all their valuables would "help me" too. Does that mean I should do it?
    "I find it weird how the morons of SOCIETY always wants to get rid of things that help them"

    breaking into the house helps you
    it does not help society

    having environmental protection and health care for the poor is good for everyone






  7. #107

    Re: Romney and Bain?

    Quote Originally Posted by jamesL View Post
    "I find it weird how the morons of SOCIETY always wants to get rid of things that help them"
    Nice try, but he's clearly talking about individuals (the "morons" in his sentence). I.e. he can't believe that people vote against things that would make them personally better off.

    breaking into the house helps you.
    it does not help society
    What if I break into the house to steal money for health care? Does that benefit just me, or also "society"? Maybe I'm breaking in to steal enough to buy a car so I can get to an interview for a job as a cancer researcher. Surely, me being employed to fight cancer helps society more than a big screen TV and some jewelry in my neighbor's hands, yes?

    There should obviously be some kind of committee set up to decide which actions are objectively in the interests of "society".

    having environmental protection and health care for the poor is good for everyone
    Of course they are, but that's only one half of the equation.

    It's just like people who argue that the government should continue to subsidize higher education because "more education is always better than less education". Well, sure. Being educated in underwater basketweaving is strictly better than not being educated in it, but that's not the complete question. The rest of it, is how much is that education worth, who decides that worth, and who ends up paying for it?



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    "Quis custodiet ipsos custodes?"

  8. #108
    IncGamers Member BobCox2's Avatar
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    Re: Romney and Bain?

    Hi Saro.
    Nice to see your posting




  9. #109
    Europe Trade Moderator krischan's Avatar
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    Re: Romney and Bain?

    Quote Originally Posted by SaroDarksbane View Post
    What if I break into the house to steal money for health care?
    There's a law about health care now, so people don't have an excuse for commiting crimes to afford medical treatment



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  10. #110

    Re: Romney and Bain?

    Quote Originally Posted by krischan View Post
    There's a law about health care now, so people don't have an excuse for commiting crimes to afford medical treatment
    The law is that you must purchase health insurance, but nice attempt anyway.



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    "Quis custodiet ipsos custodes?"

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