Debt Ceiling Filibuster

[yossarian22c]

Republicans didn't give a crap about raising the deficit and debt under Trump. But the moment Democrats get power again we get these stand offs that could significantly harm the economy and the country. Hostage taking is the Republican negotiating tactic. Remember that when they are wrapping themselves in the flag its just a human shield.

[msquared]

They are like Lucy and Charlie Brown. Always promising to hold the ball but pulling it out from under them time and time again.

[rightleft22]

The best way to get to the Libertarian conservatives ideal of "small government' is to undermine government. A kind of burn it all down nihilism..
Which isn't about Libertarian or Nihilism as much as its about the belief that without government 'I' get to keep and get what's mine... Frack any social contract.

Libertarianism isn't Fascism but if I were someone aiming for Fascism, the current distorted notion of Libertarianism makes for a useful tool.

[msquared]

That sounds like MTG.

I wonder how many Libertarians agree with the idea of the Social Contract?  almost none would be my guess. Even though many of them benefit from it.

[msquared]

Did Mitch just blink?

[yossarian22c]

Did Mitch just blink?

Just holding out the football again for Charlie Brown.

Either that or Machin and Sinema have privately indicated they will gut the filibuster if he persists.

Democrats should abolish the debt limit and take this off the table forever.

[rightleft22]

Democrats should abolish the debt limit and take this off the table forever.

I can just imagine home much the GOP would love spinning that.  But I agree it needs to be done

[Wayward Son]

Electoral-vote.com had a cute idea about that.  Set the next debt limit at $1 googol.

Even at the current rate of inflation and spending, it would take a few decades to reach that.  Maybe longer.   

[cherrypoptart]

Obama: "The problem is, is that the way Bush has done it over the last eight years is to take out a credit card from the Bank of China in the name of our children, driving up our national debt from $5 trillion for the first 42 presidents - #43 added $4 trillion by his lonesome, so that we now have over $9 trillion of debt that we are going to have to pay back -- $30,000 for every man, woman and child. That's irresponsible. It's unpatriotic."

It's funny how the national debt is only a problem when the other guys are in charge, and that's for both parties.

[Seriati]

The funny thing is that the Democrats could do this through reconciliation.  Arguing that the Republicans are holding it up, when it can be done without Republican support at all hardly seems to make sense.  What exactly is your basis for ignoring that fact?

As to raising it, the latest trend - used under Obama and Trump - is to suspend it for a period of time with it automatically resetting to the actual amount disbursed plus a percentage when the suspension period is over.  I expect that's what the Democrats actually want, and given that they have the reconciliation mess outstanding there's no reason for Republicans to agree to an open check book here.

While I think the concept of a debt ceiling is stupid de novo, at least having it forces the political class to acknowledge that they are addicted to spending.  They could trim the budget and not have to deal with it at all.

[Wayward Son]

The real question is why Republicans are holding it up at all??  Why don't they cooperate with Democrats, the way Democrats cooperated with them during the Trump years?

After all, this money is needed to pay for all the programs that the Republican Congress authorized during the Trump years.  It has nothing to do with any new programs, especially those which have not yet been passed by Congress.  So why threaten to wreck the economy over their programs?

The main reason Democrats don't want to use reconciliation is that they are still working on their main reconciliation bill.  Should they just throw that away, or rush it through, just because Republicans are too ornery to pass a bill to keep from wrecking the economy?  Sounds like blackmail to me.

[cherrypoptart]

"Why don't they cooperate with Democrats, the way Democrats cooperated with them during the Trump years?"

Because Democrats have no problem spending like drunken sailors?

Or spending taxpayers' money like they're the new trophy wife with a fresh wallet full of credit cards?

Or whatever example of big spenders anyone prefers.

Is there any actual limit to the debt beyond which the good of the nation starts to suffer more than the good that the money spent provides?

[TheDrake]

Yes, drunken sailors often run around giving people money for child care, health care, education, and basic necessities.

Fundamentally believing that giving everyone access to life saving medicine is more important than an extra space trip for Jeff Bezos and William Shatner.

The democrats don't want to borrow the money, they want to collect taxes.

[cherrypoptart]

Don't want to borrow the money?

Fiscal Year   Interest on the Debt (in billions)   10-Year Treasury Interest Rate
2018           $325                                          2.9%
2019           $375                                          2.2%
2020           $376                                          2.0%
2021           $378                                          2.2%

They may not want to borrow the money but that's exactly what's happening.

That's almost a trillion and a half just in interest on the debt over four years. That would pay for a lot nice things like child care, health care, and education. The more we pay down the debt, the less we pay in interest and so the more we'd have to use on things we want. As someone who hates paying interest, someone who has always lived below my means even when I was a lowly enlisted guy in the Navy, it pains me to see how much of our tax dollars get wasted this way. It's outrageously wasteful and they're no excuse for it. Asking to waste even more hard earned tax dollars paying even more interest on the debt is going in exactly the wrong direction. Democrats seem to think that the more money we borrow the more money we'll have to spend. That's the wrong way to look at it. The more we borrow, the less we're going to have because we're throwing so much of it away on interest payments. The first thing you do when you find yourself in a hole is to stop digging. Instead of that, the Democrats insist the solution is to throw away the shovel and call in a 45 ton excavator.

[msquared]

Cherry

You are not that obtuse are you?  The Dems would like to raise taxes on large businesses and the wealthy, the exact people Trump cut taxes on.  That would not eliminate the debt but it would make a large dent in it. Also, when the Dems proposed funding the IRS more so that more of the taxes owed but avoided/not paid by the wealthy and large businesses were collected, they opposed that as well.

[yossarian22c]

"Why don't they cooperate with Democrats, the way Democrats cooperated with them during the Trump years?"

Because Democrats have no problem spending like drunken sailors?
...

Then fight over the budget bills, not over defaulting on the debt and causing a global recession.

Democrats are fine raising the debt ceiling on their own as long as Republicans don't filibuster. They will provide all 50+1 votes to get it done. They just can't get to 60 because Mitch wants to get concessions for not harming the economy.

[yossarian22c]

The funny thing is that the Democrats could do this through reconciliation.

Reconciliation can be used once per fiscal year and takes a number of administrative hoops to jump through. Why should it need to be used to not harm the country? Seriously Democrats should bite the bullet and abolish the debt limit. Then we can just fight about the budget like normal countries do.

[Wayward Son]

Agreed.  If Democrats are forced to use reconciliation to fund our government and prevent a probable worldwide economic collapse, then reconciliate the Debt Limit to kingdom come, whether by creating a upper limit we'll never reach or by repealing the whole bad idea.

I'm sure repealing it would be considered to have some fiscal impact. 

[NobleHunter]

What I don't understand is how the cut taxes and spend party is seen as more fiscally responsible than the tax and spend party. Only one of them is interested in giving the government even the chance to pay for its expenditures.

Not to mention no one talks about how all the military spending will be paid for. Weird that financial prudence is only ever mentioned when you want the government to help people.

[rightleft22]

Weird that financial prudence is only ever mentioned when you want the government to help people.

Not so weird if the goal is 'small government' and the assumption that big businesses will look after the people needs, at least those willing to work and obey.... with big defiance to make the 'peace'. Freedom baby     

[Seriati]

I feel like these discussions are ever more pointless, as you guys respond with little but surface level analysis and sound bites.

The real question is why Republicans are holding it up at all??  Why don't they cooperate with Democrats, the way Democrats cooperated with them during the Trump years?

I mean really?  The Democrats "cooperated" in spending more money, which is their goal at every turn.  A better way to phrase this was that Trump and the Republicans compromised by granting additional spending for Democrat priorities to get to bipartisan support.

You never see Democrats offering to support any Republican priorities to get their votes.  Or can you list out the big compromise offers the Democrats are making?

You have a "reconciliation" bill on the table that includes fundemental and enormous changes to how the country works and the laws that govern everything, no part of which is to the benefit of the Republicans (or the country for that matter) and you never hear anything about the details because the media is in the tank and knows exactly how unpopoular much of what's in the bill actually is around the country (not even small majority against it, big majorities against some of these things), but somehow "democracy requires" that the minority position become the law of the land by any means necessary.

After all, this money is needed to pay for all the programs that the Republican Congress authorized during the Trump years.  It has nothing to do with any new programs, especially those which have not yet been passed by Congress.  So why threaten to wreck the economy over their programs?

By government programs you mean the $3trillion Congress provided and Trump accepted to fight coronavirus, or the $1.9 trillion more that Biden authorized?

I mean 2/3s of government spending is "nondiscretionary," but ask yourself why any of it is.  With only 1/3 (including things the federal government was actually formed to do like provide for the military) on the discretionary side, there's a never ending conflict on how to spend it.  The very fact that the Democrats are constantly pushing for new "entitlements," which then become "nondiscretionary" puts a lie to the collaborative process.  You want a true collaboration then cap what can be spent on Democratic priorities and Republican priorities at 50%.  Make them responsible for budgeting their own priorities instead of giving them an unlimited backing and incentives to underspend on what's important.

It's like local school boards.  Every time they want more money they threaten to fire the art department, the music department, to shut down sports, when none of that eats up any significant part of the budget.  Every time they get more money they don't make those priorities safe, instead they lock in a new contract with the teachers union to eat up the budget "excess" and put themselves back in the same spot 2 years later. 

Quit falling for stupid lies.

The main reason Democrats don't want to use reconciliation is that they are still working on their main reconciliation bill.  Should they just throw that away, or rush it through, just because Republicans are too ornery to pass a bill to keep from wrecking the economy?  Sounds like blackmail to me.

And using a "reconciliation" bill to pass transformational legislation in a 50/50 senate and closely divided House isn't blackmail?  The people gave a mandate for compromise and the middle road and the Democrats are abusing a process to act like they have a 90/10 senate and 100+ majority mandate in the House.

And it's not like the old days where its one shot only.  The parliamentarian already ruled the Democrats can use reconciliation 2 or 3 times.  McConnell's "demand" is that they burn one of the illegitimate "extra" reconciliations that they plan to use to abuse the system even more.

[Seriati]

Yes, drunken sailors often run around giving people money for child care, health care, education, and basic necessities.

Sounds great, what's you bank account number and password, I'm going to take your assets to pay for child care, health care, education and basic necessities in the underpriviliged community I live next too.

Send it to me by PM when you have the chance, or admit that putting YOUR money where YOUR mouth is, is a bridge too far for the sound bite machine argument you want to make.

The democrats don't want to borrow the money, they want to collect taxes.

No.  The Democrats want to spend money, primarily to buy votes and ensure that their voters are dependant on themselves.  Period.  Taxing the rich isn't really about taxing the rich, it's about exploiting envy.  Think I'm wrong?  Find the liberal state that isn't riddled with sweet heart deals for the favored local rich.  California?  Not a chance, Hollywood and Big Tech are lavished with tax breaks that prevent them from paying their "fair share."  They're going to be putting the 1% benefitting salt tax deductions right back in.  Corporations are going to fall into the favored and disfavored groups, with the first being big contributors to the reelection campaigns of the Dems and largely immune from tax harm, and the latter being hammered and passing the burden onto the poor and middle classes who buy their products.

Actions speak louder than words, and the actions of the Democrats uniformly lead to worse results for the poor, more crime, more misery.  It wouldn't take a massive propaganda machine to bury the truth if the truth was favorable.

[msquared]

What are Republican priorities?  You mean like border control and a strong military?  Or let business and rich people do what they want and not pay any taxes?

[Seriati]

What are Republican priorities?

Beats me.  Depends on which ones you're talking about.

You mean like border control and a strong military?

Those strong majority positions, if Republicans got full credit for them they'd be in control of the government.

Or let business and rich people do what they want and not pay any taxes?

Its the Democrats that get the big business donations.  If what you imply is true why would that be the case?

Face it, Democrats are all about corruption in the schemes they set up, it's "tax the rich" but include tax breaks for the friends of the left.  Or even direct subsidies, like the $12k per staff member tax credit proposed for certain media organizations in the reconciliation bill.  Or the SALT tax deductions that benefit the 1%er's.

Honestly, its just ignorant to not know that big earners already pay the majority of the taxes.  The top 10% of earners pay something like 70% of all income taxes.  That's not the same thing as the rich, the true rich may not have large incomes. 

Taxing corporations is still a regressive tax.  If you talk a big game about tax equity and also advocate for increased corporate tax rates your either being a hypocrite or ignorant.  Which is it?  Taxing corporations is nothing more than a cost of living increase burdening the middle and lower classes.  The primary "benefit" of it is that politically, the left gets to rail at and "punish" evil corporations while in reality they are instituting a massive regressive tax system and wealth transfer.  That's right, they get to stoke class envy while making life worse for the very people they claim to be helping (which coincidentally, puts more of them into government assistance programs).

When a party's power comes from the beholden, which is undeniably the case, it takes a special kind of nastiness to argue they're trying to help when the actual impact of their policies are to increase the number of beholden.

[Seriati]

Oh and by the way, the wealthy's share of taxes increased after the Trump tax cuts, the benefits to the bottom brackets were much greater by percentage than to the top.

[msquared]

Which party opposes increasing the capital gains tax? Which part opposes the wealth tax? Which part opposes the inheritance tax? Which party opposes increasing funding for the IRS so that they can collect more of the taxes owed?

[Seriati]

Which party opposes increasing the capital gains tax?

Both when they legislate.  The favorable capital gains treatment is 100% designed to encourage investment rather than idlying of wealth.  What conceivable or rationale reason is there to oppose that policy?  Are you suggesting that the world will be better if you disincentivize investment? 

Which part opposes the wealth tax?

Everyone except a tiny percentage opposes a "wealth" tax.  Everyone with a working brain is fully aware at how invasive and destructive such a tax would be.

Which part opposes the inheritance tax?

Republicans oppose the death tax, and I can't think of a moral reason anyone should favor a death tax to take post tax income from an estate.

Which party opposes increasing funding for the IRS so that they can collect more of the taxes owed?

IRS budget was $12.3 BILLION is 2020, with about 75,000 employees.  While I grant you there are 144 million taxpayers, the top 10% pay 70% of the taxes.  That works about to about 1 tax agent for about every 200 of those tax payers.  How much money and manpower exactly is necessary?  Granted some of those employees are focused on other duties, but audits are not supposed to be annual occurrences for anyone, and modern computing already targets the most likely cases with a very high degree of certainty.  Pretty much needing more for legitimate tax purposes is a lie, the desire to increase the power of the IRS is 100% around the idea that the federal government (under the Democrats) intends to track every transaction involving more than $600 and look into to every bank account with more than $600.  Not because that's going to generate revenue, because the tax payers involved are small potatoes, but because its going to generate power and, more importantly, control.

How about some more fun numbers.  The federal government spent about $6.5 trillion dollars last year and is expect to spend more before you consider adding Joe's $3.5 trillion in new spending.  US GDP is only $21 trillion dollars.  Under Biden the US GOVERNMENT wants to SPEND more than the GDP of every other country in the world (except for China - in fact the US government is asking to spend more than twice the GDP of any of those other countries) and almost literally HALF of what our country PRODUCES. And that's before you add in the state and local government's cut.

I don't know how much is "too much" but spending literally half of our actual productivity is past too much.  So when you whine about "not having enough" maybe slap yourself in the face with a Haddock or other frozen fish to try and wake up from being "woke" and realize that our spending is already insane and that in no way is the problem with anything you think the government should be doing, a "lack of money," it's all 100% completely a choice to spend it on things you aren't looking at while whining about the "important" things being underfunded.

[TheDrake]

Republicans oppose the death tax, and I can't think of a moral reason anyone should favor a death tax to take post tax income from an estate.

I can think of a reason. If you morally believe in reward according to merit, you would abhor the very concept of inheritance. Hunter biden won't deserve the money left to him, and neither will Eric Trump. As for the wish for a dollar to only be taxed once, that's some kind of made up moral code with no underpinnings. Every time a dollar changes from one hand to another it is a transaction and subject to tax. Sometimes in the same transaction it is taxed multiple times. As for wealth tax being widely opposed, what do you imagine a property tax actually is?

[Fenring]

I can think of a reason. If you morally believe in reward according to merit, you would abhor the very concept of inheritance.

Kind of depends how you define merit. I could cobble together a fairly reasonable definition that would more or less refute the right for anyone to claim anything as theirs; and likewise a different definition that would go even further than you in defining bootstrapping, to absurdity. Seems to me the reality of any usage of "merit" in real life seems like a justification to either grab what you can and keep it away from others, or otherwise to claim that others don't deserve what they have. So it's greed, or it's resentment; and not all that much in between them.

I do think a discussion about merit is pertinent to examining an economic system, but (I suppose) unlike you, I think it is a massive undertaking to approach an understand of what merit really is, and therefore how to engineer a society offering meritorious results rather than corrupt ones. Incidentally, some conservative political philosophers specifically take the position that one cannot engineer a system of maximal merit, and that any attempts to do so create more corrupt results than if you left it alone. This is where the philosophical small-government people end up at a common conclusion with libertarians and corporatists, but for very different reasons. It's worth noting who you're in bed with when arguing for a conclusion. Even if your reasons are better than theirs, all of the above win if the proposed idea wins.

[wmLambert]

Republicans oppose the death tax, and I can't think of a moral reason anyone should favor a death tax to take post tax income from an estate.

I can think of a reason. If you morally believe in reward according to merit, you would abhor the very concept of inheritance. Hunter biden won't deserve the money left to him, and neither will Eric Trump. As for the wish for a dollar to only be taxed once, that's some kind of made up moral code with no underpinnings. Every time a dollar changes from one hand to another it is a transaction and subject to tax. Sometimes in the same transaction it is taxed multiple times. As for wealth tax being widely opposed, what do you imagine a property tax actually is?

Good parents teach their children how to measure up, and inheritance is part of that. People like Hunter Biden who milk the system don't deserve what they get under the table, and inheritance may be all they're entitled to. children like Eric Yrump earn their own way.

[msquared]

If Eric Trump wanted to earn his own way he should have worked for someone other than his dad his whole life.

[Fenring]

If Eric Trump wanted to earn his own way he should have worked for someone other than his dad his whole life.

I think this is fundamentally an improper argument, even though it sort of works as a 'gotcha' statement to what appears to be right-wing hypocrisy on the subject. But historically children not just used but needed to use their parents' achievements as the main source of their job. The farmer's son learns farming and works the family farm; the carpenter's son the same, etc. Suggesting in this way that these children didn't 'earn' their way because they were instructed by their parents and continued on the family business is ahistorical and illogical. In Japanese terms it's practically a repudiation of their entire culture to argue against the continuity of a family business by the next generation. However obviously one might have to look at things differently when specifically discussing people whose entire fortune stems from wealth generating wealth. But of all things to get by right of birth, a place in dad's company seems (historically speaking) fairly wholesome.

[wmLambert]

...Is there any actual limit to the debt beyond which the good of the nation starts to suffer more than the good that the money spent provides?

Yeah, zero dollars. In general, government can never do as well spending the people's money as the people can.

The biggest divergence from reality sprung from a simple mistruth offered up in 1832. If there ever was a simple causation for all belief in the benevolence and value of a strong centralized government, then this is it. In a review of fourth and eighth grade history books, all of them get it wrong. None of them were honest about big government vs. big business. Each book spent much effort painting a picture of successful government monopolies in the Fur trade, building canals and railroads. The historical truth is that these government monopolies were uncontested failures - Failures so severe that the populace rose up in anger, ended the political forces that fed them, and turned them over to successful entrepreneurs. The books all preached to the young that big government was the savior and Robber Barons the nemesis, when in all actuality, it was the opposite that held true.

What caused this was a reliance on the historical works of John L. and Barbara Hammond, who influenced all the school books that followed. They relied on the Sadler Report of 1832 that reported the Industrial Revolution was "crowded with overworked children", "hotbeds of putrid fever," and "monotonous toil in a hell of human cruelty." Charles Dickens' novels helped to codify this image.
Would modern day Liberals feel less secure promoting big government to solve social and economic problems, if they knew in their hearts that what they learned as children was a lie? An historical review by Dr. Burton W. Folsom points out that

The history of our country is clear: It was the government that charged outrageous prices and tried to pawn off shoddy merchandise, while the private businesses that supplanted them did the job right, charged lower prices, and did it without government subsidies that kept the monopolies afloat.

The school books give the impression that robber barons stepped in to exploit whatever they could, and were a negative point in history. The lesson the books should be teaching is that in the world of commerce, the profit motive, the structure of incentives. and the stifling tendencies of bureaucrats are such that those businesses run by entrepreneurs will consistently outperform those run by the government. Instead, the authors had a bias for a strong central government. When the authors were called on these reports, they agreed that they were not reporting fact, but incorrect, unsubstantiated ideology.

As a prime example, what happened in Michigan, my home state, is the rule and not the exception. Based on Grace Kachaturoff, author of Michigan, Folsom wrote:

Mr. Sadler, we know today, lied in his report. He was a member of Parliament and made up much of his report to gain supp ort for a bill he wanted to see Parliament pass. Economist W. H. Hutt has described Sadler's falsification of evidence. Even Friedrich Engels, comrade of Karl Marx, concluded that "Sadler permitted himself to be betrayed by his noble enthusiasm into the most distorted and erroneous statements.

When the state builds a project, the incentives are different from those of private enterprise. Satisfying political interests is often more important to legislators than building a railroad that is financially sound and well constructed. State builders use taxpayers’ money, not their own. If the road fails, it’s the state, not the builders, with empty pockets. The Michigan story is full of accounts of padded vouchers, illegal bidding, cost overruns, and the stealing of materials by contractors and even by the citizens themselves. Since no one actually owned the railroads, no one felt the responsibility to take care of them.

Judge Thomas Cooley, Michigan’s most famous 19th-century lawyer and a president of the American Bar Association, observed this waste firsthand. He wrote about it later and said, "By common consent it came to be considered that the State in entering upon these works had made a serious mistake." The people of Michigan, Cooley reported, became convinced "that the management of railroads was in its nature essentially a private business, and ought to be in the hands of individuals." In 1846, therefore, the state of Michigan abandoned all the canals and sold the Central and Southern Railroads, which were only partly completed, to private investors. The
new owners promised to do some rebuilding and to expand the lines to the Chicago area. From this distress sale, the state recovered one-half of its $5 million investment and ended its headaches from being in the railroad business.

Once the railroads had been privatized, they were rebuilt with care and extended across the state. At last, Michigan citizens had the roads they needed to trade and thrive. This turnaround was so startling that its implications were not lost on Michigan voters. They learned from history.

In 1850, Michigan threw out its old constitution and wrote a new one. It read, "the State shall not subscribe to or be interested in the stock of any company, association, or corporation." Furthermore, "the State shall not be a party to or interested in any work of internal improvement, nor engaged in carrying on any such work" except to provide land. The heavily taxed voters were determined to learn from their mistakes and chart a better future for the state. In the years of laissez-faire that followed, Michigan’s entrepreneurs developed the state’s natural resources— lumber and iron ore—so effectively that Michigan soon became a major industrial state.

[msquared]

Fenring

I might agree if the child started at the bottom and learned and worked their way up.

The company my dad worked for had a rule, no hiring the sons of the partners.  My brother and I were the only exception that I know of and we only worked on the yard crew for a few years during high school.  They wanted to kids of the founders  to make their own way.

But graduating business school and being made a VP the next day is not a way to earn the respect of your co workers.

[Fenring]

The company my dad worked for had a rule, no hiring the sons of the partners.  My brother and I were the only exception that I know of and we only worked on the yard crew for a few years during high school.  They wanted to kids of the founders  to make their own way.

Yes, I'm familiar with this kind of idea; eliminate some of the privilege and prove you've earned your stripes, sort of thing. I just think that this is an exaggerated version of what is already a highly Western notion of 'independence': when you're of age, you're expected to leave your parents' house, get your own job, have your own family, and exist as a solitary 'nuclear' family that rinses and repeats. For one thing, this type of schema is necessarily only useful for people who are at least of average quality in terms of employability. But it negates all of the realities involved in the 'parity' it tries to create. A good example of this is the standard Boomer notion of the younger generation 'working as hard as we did from the ground up.' My grandfather used to talk all the time about how unlike kids today, he paid his own way through college, walked to work each day, and all the rest as the refrain goes. But the thing is, even putting aside the cultural issue I brought up, my grandfather was able to work a part-time job to entirely pay for college, no debt. In the 60's and 70's a person could just go get a moderately good job, and buy a house and car with it while supporting a wife and three kids, TV and all. I think you get the drift of where I'm going with this. So any kind of notion of "you need to work as hard as I did" is made nonsensical by the actual realities from then and from now, and in my experience it's usually the Boomer generation that has this idea of earning your stripes as a badge of honor.

Putting that aside, and purely on a level of what's actually best for young people, I think as with many things we'd find it will depend on the actual individuals involved. What if Trump's kids are not enterprising people, and what if this is genetic? They don't "deserve" to work with their father, even though they're well suited to be followers rather than leaders? What if they are nervous types, or incompetent but can still be of help to dad; I can name a ton of scenarios both involving merits or demerits they may possess, that could explain why working for dad is better *for them* than hacking their way through the work force and not getting very far. I don't just mean better for their bank accounts, I mean better for them full stop.

Anyhow, I may be getting into the weeds on this. I think people are too judgemental.

[yossarian22c]

Seriati, you gave a rationed and wordy argument that completely misses the point.

The fight over the debt ceiling isn't a fight over spending. The spending has been done. The debt ceiling fight is a fight over honoring debts and contracts. Using default, financial chaos, and a likely global recession as a bargaining chip is unethical.

Government shut downs are stupid and don't save money in the long term but I guess that could be a valid negotiating tactic. But holding up the debt ceiling is simply economic hostage taking.

[Seriati]

Seriati, you gave a rationed and wordy argument that completely misses the point.

The fight over the debt ceiling isn't a fight over spending. The spending has been done. The debt ceiling fight is a fight over honoring debts and contracts. Using default, financial chaos, and a likely global recession as a bargaining chip is unethical.

Government shut downs are stupid and don't save money in the long term but I guess that could be a valid negotiating tactic. But holding up the debt ceiling is simply economic hostage taking.

The fight over the debt ceiling is completely about spending.  Even the idea that we've "already spent" the money reflects a fundamental confusion on your part.  All that has happened is that Congress has declared they intend to spend most of the money, they've allocated it.  Very little of it has been "spent," which is exactly why the debt ceiling is relevant, they require more borrowing to pay out more money.

They could cancel programs, reclaim unspent amounts, fire staff and restructure or eliminate federal bureactatic groups that are not needed.  Do that and the debt ceiling isn't at risk because those "commitments" only exist because Congress wants to waste more money to get re-elected.  Congress could stop creating entitlements and the entire idea of a runaway budget would cease.

Reality is that declaring programs "non-discretionary" is nothing more than a political fiction pushed by politicians.

Republicans oppose the death tax, and I can't think of a moral reason anyone should favor a death tax to take post tax income from an estate.

I can think of a reason. If you morally believe in reward according to merit, you would abhor the very concept of inheritance.

There's nothing remotely logical about your construct, as the conclusion does not follow of necessity (or even at all) from the premise.  If I believe in "reward" then I have a concept of what reward means.  You seem to believe that anyone who believes in providing rewards for merit MUST OF NECESSITY believe that they can only be a life estate that expires upon the individual's own death.  But that's a fundamentally bizarre version of reward and it completely discounts that the ONLY THING that I can "take with me" after death is my genetic legacy.  I literally live on because of my genetic contribution to my children, and through them to my grandchildren and so on and so forth.  Any rewards that I earn are really only usefully employed in increasing the number of those children and the quality of their prospects.

Ergo, inheritance is the only reward.

The idea that "merit" could be redeemed other than through inheritance is virtually incomprehensible, though others may have different views.  But for me an assault on inheritance is an attack on merit.

Hunter biden won't deserve the money left to him, and neither will Eric Trump.

No, but their father's do deserve the ability to leave it to them nonetheless.  Your argument here boils down to jeaslousy.

In fact, the lack of merit for Hunter will play out over time when his father is no longer in a position of power.  Hunter is a waster, and the scions of the powerful that fail are far more numerous than those that succeed even at the same level as a parent. 

As for the wish for a dollar to only be taxed once, that's some kind of made up moral code with no underpinnings. Every time a dollar changes from one hand to another it is a transaction and subject to tax. Sometimes in the same transaction it is taxed multiple times. As for wealth tax being widely opposed, what do you imagine a property tax actually is?

I notice you haven't sent me your bank account information.  You've bought into to ritualized theft with your extollation of the wonders of the tax purpose.

A death tax is rough cudgel that's used to punish success (ie you died with too much merit so we have to take it away) or to encourage reinvestment, which is expressly not what we're getting here based on the actual ways it's calculated.  There is literally NO GOAL served by a death tax that is not better served with tax incentives targeted at encouraging the behaviour you want to see more of.

[TheDrake]

Hell according to those rules, what is wrong with an aristocracy? Which is what inheritance creates. Rand wouldn't agree with you, and her moral heroes deliberately do not lift a finger to help their kids in any way. In the ultimate view of man qua man, everyone is an individual and there are no clans.

Not to mention that massive concentrations of wealth often involve immoral actions done to other individuals because of a position of power rather than value for value.

Now, in pure objectivism it would also be abhorrent to have the government take your wealth upon death. In that moral utopia, the last will and testament would give that money to someone according to their value. Which might be a perfect stranger or an entity or otherwise. Normally that would be a value for value proposition. Say, a child who cares for their elderly parent. But that transaction would be happening in real time, it wouldn't be contingent on death.

[Wayward Son]

The fight over the debt ceiling is completely about spending.  Even the idea that we've "already spent" the money reflects a fundamental confusion on your part.  All that has happened is that Congress has declared they intend to spend most of the money, they've allocated it.  Very little of it has been "spent," which is exactly why the debt ceiling is relevant, they require more borrowing to pay out more money.

They could cancel programs, reclaim unspent amounts, fire staff and restructure or eliminate federal bureactatic groups that are not needed.  Do that and the debt ceiling isn't at risk because those "commitments" only exist because Congress wants to waste more money to get re-elected.  Congress could stop creating entitlements and the entire idea of a runaway budget would cease.

But these are all things they should have done when they were creating the bills in the first place.  So all the debt ceiling does is make Congress renegotiate the bills they have already passed.

But with the filibuster, Republicans don't have to renegotiate anything.  They just prevent any bill that they don't like from being passed, and the country defaults on its financial obligations.  And they only need 41% of the Senate to to that.

It gives too much power to a minority of politicians to veto bills that were already passed.   

[cherrypoptart]

Supporters of the death tax miss one important point. It's not about whether the children have done anything to deserve that money. It's about the person who earned it and already paid taxes on it getting to spend it on what they want. If it's going into space for a minute then that's their prerogative. And if that's their children then so be it.

I could definitely see if a wealth tax along with greater death taxes get passed a lot of people taking their money and running. There are a few countries without death taxes, without gift taxes, and some without even capital gains taxes. There is just the exit tax to contend with and that's low in comparison to what the Democrats have in mind so we could see huge capital flight along with citizenship renunciations if the Democrats get their way, the whole "The more you tighten your grip, Bernie, Elizabeth, Nancy, the more tax dollars will slip through your fingers."

The Democrats are driving this country into the ground every which way they can and money won't even be the only reason people start fleeing. Murder, riots, open borders, pestilence, sky high inflation, anarchy and perhaps oddly enough with it, lack of freedom will drive people out just as happens with other failing nations. We'll still be several steps up from most of the world so will still get the massive influxes of the poor and downtrodden but at the same time will be losing the cream of the crop.

All this talk about getting rid of the death ceiling makes you wonder what if that had been done thirty years ago. What if we'd had no debt ceiling to contend with every so often, what would our national debt be right now instead of the nearly 29 trillion dollars it is? We can only guess but there's little doubt it would be a lot higher. I'd say at least 40 and maybe above 50 trillion.

And if we get rid of the debt ceiling now our debt will be even more crushing in the future than it will be if keep it and fight about it every now and then like we should.

[TheDrake]

That must be why everyone has fled Europe for these glorious tales havens. Except, no they haven't. The UK inheritance tax is 40%, and London has not experienced a collapse in its billionaire population. The taxpocalypse that you conjure up is a mirage. Especially when you consider how many very wealthy people support these taxes.

As for people deserving to keep their wealth and do what they want with it, do people deserve to be part of a semi permanent underclass because they were unlucky to be born into an impoverished family? What people deserve is a truly level playing field. Nobody would agree to play monopoly if the winner of the last game got to hand their cash to a player in the next game.

[NobleHunter]

Given that the debt ceiling is never mentioned except when they're about to bounce off it, I don't think it has any influence on spending. Everyone assumes the ceiling will be raised when the time comes so there's no reason to try and constrain spending to avoid it. There's enough non-discretionary and non-partisan (like defense) spending that it would have to be raised regularly anyways.

ETA: I'm only tangentially familiar with the decline of the English aristocracy but I would not be surprised if inheritance taxes had something to do with it. It is amusing to see Americans argue in defense of aristocratic wealth.

[TheDeamon]

I could definitely see if a wealth tax along with greater death taxes get passed a lot of people taking their money and running. There are a few countries without death taxes, without gift taxes, and some without even capital gains taxes. There is just the exit tax to contend with and that's low in comparison to what the Democrats have in mind so we could see huge capital flight along with citizenship renunciations if the Democrats get their way, the whole "The more you tighten your grip, Bernie, Elizabeth, Nancy, the more tax dollars will slip through your fingers."

It's worse on the "death tax" in reality. People with the "real money" that could rake in serious tax revenue also have the means to structure their assets in such a manner that they avoid most of those taxes as they're held by a trust prior to their death. So the only people who end up paying through the nose due to death taxes are lower-middle and lower income people. Or wealthy people who failed to plan for how to handle their financial legacy, but those people will have problems that go well beyond death taxes.

[NobleHunter]

As I understand it, the current inheritance tax applies only to estates of a certain size. A size well beyond any reasonable definition of middle class. As for loopholes, they should be closed or guided to useful applications. Back when the rich had more reasonable tax rates, they'd do useful things like funding museums and libraries rather than hoarding their wealth just to watch it get bigger. Taxing inheritances shouldn't be about raising revenue but changing behaviors when people outlive their giant piles of money.

[Mynnion]

I am certainly no expert but based on a Forbes article it sounded like the current laws do not take into account Capital Gains, or at least that is how I read it.  If an individual sells the day before they die they pay Capital Gains.  Once they die Capital Gains no longer applies.  Seems like a fairly massive tax loophole.

[TheDrake]

As for impact on economy, seems to me that spending money would be better than hoarding it to give to your middle aged kids when you expire.

[Fenring]

As for impact on economy, seems to me that spending money would be better than hoarding it to give to your middle aged kids when you expire.

No one hoards anything, it's almost impossible to do so these days. It's invested somewhere or other, and the ownership just gets passed along. It would actually be silly to liquidate prior to inheritance, and triggering a major taxable event.

To me the argument that "the money should be doing something useful rather than sitting around in a fat bank account" is specious. It is always doing something for the economy. To the extent that some monies are not benefitting the [local] economy, it would be because of offshoring, which although pernicious, would not be directly related to the local inheritance tax issue since the whole point of offshoring is to evade local government taxes. I would be the first to agree with putting the kibosh on circumventing tax law, though.

What I think is a more proper argument, if one was taking the anti-billionaire position, would be not that the money isn't doing something, but that the flow of wealth it does generate is geared toward increasingly doing something that mostly benefits a very few people. The trickle-down argument is the only alleged mitigating factor to this, but I personally view it also as a specious argument (fun fact, I just read that the original coinage of the trickle-down idea was in fact meant as a lambaste of Hoover by a comedian, and did not originate as an economic theory at all!). So my suggested argument would be that the nature of wealth at present begets more wealth for those that already have it; or in gaming terms, it's a built-in snowball mechanic. I think the issue of inheritance tax is sort of like saying this never should have happened in the first place, and we need to cut it off at some point. But personally I'm not sure that inheritance would be the correct point at which to cut it off if one were intent on doing so.

[NobleHunter]

I don't think that the giant piles of wealth sloshing around the stock market and other repositories of capital are really doing much good compared to what it could do in the hands of individual consumers.

It is true an inheritance tax isn't alone sufficient to encourage more useful diversions of wealth and diminish the threat of ever-concentrating wealth. But we're not going to get a comprehensive and coherent tax structure, so band-aids against the rising plutocracy will have to do.

[Wayward Son]

As I understand it, the current inheritance tax applies only to estates of a certain size. A size well beyond any reasonable definition of middle class.

Just to give a number to that:

The IRS exempts estates of less than $11.7 million from the tax in 2021 (up from $11.58 million in 2020), so few people actually end up paying it. Plus, that exemption is per person, so a married couple could double it. The IRS taxes estates above that threshold at rates of up to 40%.

The article goes on to show the tax rate for estates above $11.7 million, which comes out to a tax rate of 34.58% for the first million dollars, and a straight 40% after that.

Anyone here who is middle-class?  Anyone who would be affected by the "death tax?" 

If you are affected, can I borrow $10? 

[Fenring]

I don't think that the giant piles of wealth sloshing around the stock market and other repositories of capital are really doing much good compared to what it could do in the hands of individual consumers.

That kind of depends what the stock market "is". I suspect there might be some controversy even among experts about what this market supposedly does in the first place. Even putting aside the existence of financial instruments like derivatives and shorts, even the mere fact of people trading stocks amongst themselves to see if they can profit off it...does that actually benefit the company materially? It's not like a round of investment by a private company where the sale of stocks is used to generate tangible monies for expansion. The company itself sees none of this action, aside of course from the stockholders within the company who personally benefit from the stock price going up.

So I'm not really against the idea of questioning what the hell these so-called investments really amount to in terms of materially adding to productivity and jobs. If my most cynical idea is true - that the stock market exists chiefly to benefit stockholders alone and does not help a company's internal processes - then I would be inclined to agree with TheDrake; not in the letter of what he wrote, but in the spirit of saying that these 'investments' are really just piggy banks where you keep drawing more and more cash out of it. But if one questions this then fundamentally it is capitalism itself being questioned, not a particular set of tax laws.