Inflation cures?

[Kingseve1]

Corporations aren’t guys. Buffett is making a different point than taxing corporations. He is talking about individual income taxes. I think he is wrong, but that’s beside the point.

I know that. I didn’t bring up corporations. My thought was taxing the individuals making multimillion dollar salaries a little bit more and any monies made above 2 million.


You disagree with the best investor money man of all time. He memorizes balance sheets while he’s taking a dump. I’m betting with wise Warren

 

[cat_in_the_hat]

I know that. I didn’t bring up corporations. My thought was taxing the individuals making multimillion dollar salaries a little bit more and any monies made above 2 million.


You disagree with the best investor money man of all time. He memorizes balance sheets while he’s taking a dump. I’m betting with wise Warren

Your second post in this thread says corporations need to pay more taxes and that you don’t understand why anyone would disagree with that.

Just because Buffett is good at investing doesn’t mean he knows a crap about public policy and fair taxation.

 

[HymanKaplan_rivals48997]

Buffett, entered the stereotypical and predictably boring wealth guilt phase of his life years ago.
Giving money away is fine, but what they REALLY get off on is handing out unsolicited and worthless advice, and telling others how they should feel.


I say, "F*** off, Old Man Potter..."

 

[Lexie's Dad]

I thought corporate tax revenue = bad and is just passed on to the consumer

Increased taxes cause a decrease in supply. A decrease in taxes, ceteris paribus, causes an increase in price.

Prices aren't as elastic as the TV rhetoric would have you believe.

Income elasticity or price elasticity?Demand curves have a section where demand is inelastic and a section where demand is elastic.

Also- what TV rhetoric? I've never heard someone say, "The elasticity of demand for tacos is 2.06."

 

[vhcat70]

That was my first thought as well

You always struck me as smart.

 

[jameslee32]

All of our politicians looking backwards to a time in US history that is much more palpable to them, need to closely examine tax rates for ordinary income, capital gains, corporations etc during these golden years.

 

[cat_in_the_hat]

All of our politicians looking backwards to a time in US history that is much more palpable to them, need to closely examine tax rates for ordinary income, capital gains, corporations etc during these golden years.

I wouldn't assume the same tax structure in place during post war America will have the same affect in today's world economics. It wasn't the tax structure of the time that created that economy.

 

[DreadLox]

I'm not defensive of the big dogs. I just know that corporations don't pay taxes. Consumers do.

Basically, I'm not stupid...

$425 billion. Prices aren't as elastic as you imagine.

 

[Kingseve1]

All of our politicians looking backwards to a time in US history that is much more palpable to them, need to closely examine tax rates for ordinary income, capital gains, corporations etc during these golden years.

Flat tax on errrrthing?

25 percent. No deductions

 

[Laparkafan]

Flat tax on errrrthing?

25 percent. No deductions

So many loopholes in tax law either a flat tax on reported income or a universal usage tax (gas/groceries/commodities/etc)

 

[Lexie's Dad]

$425 billion. Prices aren't as elastic as you imagine.

Which prices aren't elastic?

Again- each demand curve has elastic and Inelastic sections

 

[bigblueinsanity_rivals250340]

$425 billion. Prices aren't as elastic as you imagine.

Cut costs or nothing matters. I noticed the usual suspects keep dancing around this because it isn't as sexy as "tax the rich!". When in reality the true battle cry is "tax the other rich!"

For every virtue signaling bozo like buffet - they can absolutely pay in tax whatever they think they should. No one would complain and their alleged "conscious" would be settled. Yet they never did that not even once.

There will never be enough tax revenue. Cut costs. Stop listening to people are aren't genuine.

 

[Hank Camacho_rivals115797]

Hyman for president.

I would absolutely vote for a drunk clown over the current leaders -- and consider it an honor.

Might even try to listen to that godawful Mezerg crap.

 

[HymanKaplan_rivals48997]

I can't do POTUS. The other branches of government aren't worth my time.


I would accept a time limited dictatorship. That's the only way I'll do it.
How about it America? 3 to 5 years of a HymanKaplan benevolent dictatorship?

I really don't see what you have to lose.

At the very least, ALL of our current elected officials will either be in prison, or looking for a job (for the first time in their lives) All of their investment/wealth portfolios will be liquidated and put in escrow, until such time as a suitable, and mutually agreed upon use for those funds can be determined.

The 2 party system is finished (to clear the way for the day I step down and usher in the "universally independent" Legislative branch. This should effectively neuter the "bat-****" contingent on the left, AND right. The left looneys can go back to camping out on and holding protests on Telegraph St. And the right looneys can keep hoarding guns and prepper food (endorsed by some guy on TV that prattles on about Revelations etc.)

Once the Senate and HOR crank back up, it will be in the "mold" of jury duty. You live in a dormitory, eat at the dormitory cafeteria, you won't draw a salary, but, unlike jury duty, the Federal government will cover the salary and benefits you were earning (from the job you left to temporarily perform your civic duty), and you will be, by law, guaranteed to resume your old job, once you're released from Federal Legislative Service. If the job/company etc. goes belly up, you'll be entitled to a generous "severance package" and job placement services at no cost.

Campaign funds will be a thing of the past. If someone wants to run, all "air time/commercials", debates, political ads, will be paid for with Federal funds, and divided up equally (probably during pre-determined time slots, in which all the ads will run back to back. Those that give a crap can tune in, but those that DON'T give a crap won't have to endure an endless stream of political ads. A vetting process (put a pin in that for now) can reduce the field to a manageable group.

Federal judges, once nominated and confirmed, can serve a maximum of two terms (4 years per term), after that, well, open a law office, or run for a local judgeship. They WOULD be eligible to serve as a Supreme Court Justice though, even after serving their 2 terms.

Supreme Court Justices shall serve ONE 10 year term. That's it. 10 years and then find another f***ing job. Or don't...
Bottom line: the days of making a career of politics (in DC) are OVER.



In that vein, all Federal government employees will be re-classified as "at will"


(This will do for a first draft)

 

[HymanKaplan_rivals48997]

Oh, and I'm going to need that White House cocaine forwarded to me.

For safe keeping.

 

[DreadLox]

Which prices aren't elastic?

Again- each demand curve has elastic and Inelastic sections

The point is that corporations can't automatically add their taxes to their cost of doing business. If BP had problems with shipping or drilling that another oil company didn't have, that additional expense would show up in a downward pressure on their profits. Tax liabilities aren't magical, consequence-free expenses.

 

[cat_in_the_hat]

The point is that corporations can't automatically add their taxes to their cost of doing business. If BP had problems with shipping or drilling that another oil company didn't have, that additional expense would show up in a downward pressure on their profits. Tax liabilities aren't magical, consequence-free expenses.

The difference is problems shipping or drilling may only affect one or two providers, so it doesn't impact the market price of a good or service. A universal change in cost in an industry will result in higher or lower prices, depending on the direction and nature of the change. Taxes represent a cost that affects every participant in an industry, so there is not a market reason to not pass that cost through. Are the sale of certain products more price elastic than others? Absolutely. Therefore, some industries, or individual products, may not raise prices as much as other industries, or products, but cost increases that affect everyone is absolutely inflationary and will harm consumers. Politicians bet that citizens aren't knowledgeable enough to understand that taxes are built into the products we buy and raising corporate taxes doesn't help us in any meaningful way.

As a side note, why is it a good thing to hide taxes in the price of products and services? It seems to me that it's not a very transparent way to taxing citizens. Less transparency means less push back on government spending because you don't really know how much of your money is going toward your tax burden. Direct taxation to individuals seems like a much better way to tax people because you know what it is costing you to run the government. If you think it's too much, you will push back. Corporate taxation removes an important check on government spending in my opinion.

 

[DreadLox]

The difference is problems shipping or drilling may only affect one or providers, so it doesn't impact the market price of a good or service. A universal change in cost in an industry will result in higher or lower prices, depending on the direction and nature of the change. Taxes represent a cost that affects every participant in an industry, so there is not market reason to not pass that cost through. Are the sale of certain products more sensitive to price elasticity than others? Absolutely. Therefore, some industries, or individual products, may not raise prices as much as other industries, or products, but cost increases that affect everyone is absolutely inflationary and will harm consumers. Politicians bet that citizens aren't knowledgeable enough to understand that taxes are built into the products we buy so raising corporate taxes doesn't help us in any meaningful way.

As a side note, why is it a good thing to hide taxes in the price of products and service? It seems to me that it's not a very transparent way to taxing citizens. Less transparency means less push back on government spending because you don't really know how much of your money is going toward your tax burden. Direct taxation to individuals seems like a much better way to tax people because you what it is costing you to run the government. If you think it's too much, you will push back. Corporate taxation removes an important check on government spending in my opinion.

Every company has their own balance sheet. Taxes will hit each differently according to their own history.

 

[cat_in_the_hat]

Every company has their own balance sheet. Taxes will hit each differently according to their own history.

It's still a general cost increase to everyone. The fact that some companies may have short term write-offs which lowers their tax payments doesn't change the fact that higher tax rates, absolutely 100% of the time, increase long run costs. Prices generally aren't based on short run costs.

 

[Lexie's Dad]

The point is that corporations can't automatically add their taxes to their cost of doing business. If BP had problems with shipping or drilling that another oil company didn't have, that additional expense would show up in a downward pressure on their profits. Tax liabilities aren't magical, consequence-free expenses.

The point is that tax increases cause a decrease in supply. A decrease in supply increases price.

Yes, the magnitude of the price increase will be a function of the elasticity of demand - perfectly elastic demand leads to no price change while perfectly inelastic demand means the entire tax is passed on in the form of higher prices.

Decreased profits cause investors to flee. Hard to believe that anything other than a very short-run change will have no effect. Your drilling and shipping example is short run. If they persist, they will cause price increases.

 

[Lexie's Dad]

Every company has their own balance sheet. Taxes will hit each differently according to their own history.

And the collective actions of every company comprises market supply.

 

[DreadLox]

Decreased profits cause investors to flee. Hard to believe that anything other than a very short-run change will have no effect. Your drilling and shipping example is short run. If they persist, they will cause price increases.

And yet lot of these companies make huge profits and have scads of investors.

There are lots of economic truisms that have turned out to be just slogans. 2008 gutted so much of academic economics. So many of them were sure that everything was just great.

 

[bigblueinsanity_rivals250340]

Always a mix of wonder, pity, and frustration watching people try to explain basic concepts to a certain segment of the populous.

Taxation of an activity effects all. Not some. Yes it also increases costs downstream because it's all factored in

 

[Kingseve1]

https://www.cnbc.com/2023/07/07/jobs-report-june-2023-.html

40 percent of what the ADP report “foretold.” 209,000 jobs and 3.6 unemployment rate. ADP was at 497,000

Hope they don’t keep jacking up the rates. Let these current rates do their thing

 

[cat_in_the_hat]

I wanted to add some comments about price elasticity. Price elasticity is not static. In other words, it's relative to general market prices and wages. As prices and wages increase or decrease, a price that created a specific change in the demand for a product will create an entirely different change in demand at the new general price and wage levels. The point is that you can't base the elasticity of demand for specific goods and services on todays prices and wages and assume that the same relationship holds true after inflation or deflation in prices, and, or wages.

Another point about higher taxation and investment that has been mentioned already. If some manufacturers cannot passthrough all of the higher taxes, and have to accept lower margins, investors will redirect capital to other, more lucrative investments. No one is going to accept a lower rate of return with comparable risk than they can get with alternative investments opportunities.

Finally, arguing that there may some businesses that can't pass through 100% of a tax increase is a pretty poor argument that increasing taxation on businesses helps consumers. Does it really matter that you may only end up paying 90% of the tax increase through the price of the goods and service you purchase? It's still a tax increase on consumers that is being hid in the price of goods and services. What proponents of higher business taxation are really saying is that companies who produce products whose demand fluctuates highly based on the price of the product should pay more taxes. Everyone else will pass it through to consumers. And even those with elastic demand curves will eventually pass it through as inflation and wage growth occurs.

 

[HymanKaplan_rivals48997]

Always a mix of wonder, pity, and frustration watching people try to explain basic concepts to a certain segment of the populous.

Taxation of an activity effects all. Not some. Yes it also increases costs downstream because it's all factored in

The only explanation I can think of is that this board has an inordinately high number of education and journalism majors.

 

[AIChatGPT]

And yet lot of these companies make huge profits and have scads of investors.

There are lots of economic truisms that have turned out to be just slogans. 2008 gutted so much of academic economics. So many of them were sure that everything was just great.

No way man. We have a whole lot of Paddock economists that crushed Microeconomics 101.

Shoot, they could teach Gayle Hoyt a few things.

 

[Lexie's Dad]

I wanted to add some comments about price elasticity. Price elasticity is not static. In other words, it's relative to general market prices and wages. As prices and wages increase or decrease, a price that created a specific change in the demand for a product will create an entirely different change in demand at the new general price and wage levels. The point is that you can't base the elasticity of demand for specific goods and services on todays prices and wages and assume that the same relationship holds true after inflation or deflation in prices, and, or wages.

Another point about higher taxation and investment that has been mentioned already. If some manufacturers cannot passthrough all of the higher taxes, and have to accept lower margins, investors will redirect capital to other, more lucrative investments. No one is going to accept a lower rate of return with comparable risk than they can get with alternative investments opportunities.

Finally, arguing that there may some businesses that can't pass through 100% of a tax increase is a pretty poor argument that increasing taxation on businesses helps consumers. Does it really matter that you may only end up paying 90% of the tax increase through the price of the goods and service you purchase? It's still a tax increase on consumers that is being hid in the price of goods and services. What proponents of higher business taxation are really saying is that companies who produce products whose demand fluctuates highly based on the price of the product should pay more taxes. Everyone else will pass it through to consumers. And even those with elastic demand curves will eventually pass it through as inflation and wage growth occurs.

Changes in price don't cause a change in a product's own demand - they cause a change in quantity demanded (different prices are incorporated into every demand schedule), though they can change the demand for substitutes or complements in consumption But - technicalities aside, I agree with you.

 

[Lexie's Dad]

No way man. We have a whole lot of Paddock economists that crushed Microeconomics 101.

Shoot, they could teach Gayle Hoyt a few things.

There's at least one banker here that has taught the **** as a side-hustle for 29 years.

 

[jameslee32]

https://finance.yahoo.com/news/june-cpi-inflation-data-july-13-2023-123148137.html