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Politics : Formerly About Advanced Micro Devices
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To: tejek who wrote (746972)10/16/2013 3:16:28 PM
From: TimF  Read Replies (1) of 1570918
 
We already raised taxes, next move should be spending cuts. If we actually start reducing spending in some serious way, then get back to me about tax increases.

Whether or not we have tax increases cuts, or at least a serious reduction from the planned increases (which you would call a cut even though it isn't) are needed. Except for a couple of years during WWII (when there was the pressure of the war, rationing, all sorts of extreme controls on the economy) the feds have never been able to cover spending at this percentage of GDP with taxes. Doesn't matter what the top tax rate is. Top marginal rates have been 7% and they have been 92% and broadly speaking every level in between. Whatever they where set at the feds have not been able to pull in enough to cover what we are spending now, let along the entitlement increases in the future.

I suppose its not impossible to cover today's spending with taxes, but you would have to have a major tax increase on everyone not just the rich (who are not numerous enough, who already face the highest rates so are further along the the Laffer curve, and who can control their reported income in terms of type and amount to limit tax liability to a much greater extent than the non rich). A VAT or national sales tax could bring in enough. But it would also be bad for Americans and the American economy, and while it would cover today's level of spending, it would struggle to cover the projected future increases.
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