The "People's Budget" from Progressive Caucus

#76
#76
volinbham said:
Fallacious argument on several grounds

1) only for some companies have real taxes been zero - most are paying taxes.

1a) if real taxes were zero for corporations it still doesn't negate the fact that changing that from zero to some positive number would put upward pressure on prices.

2) price changes are directly impacted by costs (including tax costs). Operating and supply costs have risen in several industries putting upward pressure on prices.

Taxes on profits are a cost to corporations. Remove that cost and it will be reflected in pricing. Costs are passed through to the consumer.
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That is absolutely not correct. Your entire argument is premised on this fallacy, volinbham.

In real capitalism, the smartest competitor would capture market share by keeping prices low. Smaller profit margins would be corrected with future market gain. Meanwhile, profits for corporations "passing on costs" would continue to decrease. This is Capitalism 101, people!

Now, if you are suggesting monopoly power allows those costs to be passed on, I might suggest you have a point (or, before realUT has a go at "monopoly" - a few large players with overwhelming market share).

But, of course, you dare not tread there lest the entire edifice starts to crumble.
 
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#77
#77
utgibbs said:
Or sings better, or is 6'9'' and has a great shot from the wing, or is better at running ponzi schemes, or a host of other criteria having little to do with hard work, "balls", or anything else.

Let me tell you the first rule I learned as an entrepreneur: "Never use your own money, kid." These mythological notions everyone has of entrepreneurship, "risk", and the like frankly astonishes me. It is much, much different actually doing this stuff.

Regardless, those who benefit most from the system, should rightly (and fairly) pay more. It's just simple economics.
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So your saying you don't pay enough in taxes? Have you wrote a check to the IRS as extra payment or have you enjoyed the tax break?
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#80
#80
VOLFAN_MTSUALUM said:
So your saying you don't pay enough in taxes? Have you wrote a check to the IRS as extra payment or have you enjoyed the tax break?
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I've often said I probably pay too much because we don't have a simple, transparent, and progressive system.

Let's put it this way, I would GLADLY pay for single payer insurance (as my costs would go down), and I will gladly pay my bracket in a simple, transparent, and progressive system.
 
#82
#82
utgibbs said:
That is absolutely not correct. Your entire argument is premised on this fallacy, volinbham.

In real capitalism, the smartest competitor would capture market share by keeping prices low. Smaller profit margins would be corrected with future market gain. Meanwhile, profits for corporations "passing on costs" would continue to decrease. This is Capitalism 101, people!

Now, if you are suggesting monopoly power allows those costs to be passed on, I might suggest you have a point (or, before realUT has a go at "monopoly" - a few large players with overwhelming market share).

But, of course, you dare not tread there lest the entire edifice starts to crumble.
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I hate to tell you but you're wrong gibbs. I'm going to give you a real world example that you can shove up your arse and deal with. You can disagree with me all you want but it's a fact.

When a business is sold the seller factors in the cost he will have to pay in taxes if it is an asset sale. He will add this cost to the purchase price to offset his tax loss. This increase in the purchasing price is passed onto the buyer and as forces them to borrow more to purschase the business or pay more out of current company assets to buy this business. This happens daily in many business. I just sold one of my smaller offices off to a buyer so I could use the funds to place a down payment on another business located elsewhere which was much larger and had a better loss ratio. I factored in the gains I would have to take do to it being an asset sale and not a stock sale as I wanted to keep the name with me and the other assets in the business. The buyer had to borrow more to deal with this added increase. This is very common any time a business is bought or sold.
 
#84
#84
NEOCON said:
I hate to tell you but you're wrong gibbs. I'm going to give you a real world example that you can shove up your arse and deal with. You can disagree with me all you want but it's a fact.

When a business is sold the seller factors in the cost he will have to pay in taxes if it is an asset sale. He will add this cost to the purchase price to offset his tax loss. This increase in the purchasing price is passed onto the buyer and as forces them to borrow more to purschase the business or pay more out of current company assets to buy this business. This happens daily in many business. I just sold one of my smaller offices off to a buyer so I could use the funds to place a down payment on another business located elsewhere which was much larger and had a better loss ratio. I factored in the gains I would have to take do to it being an asset sale and not a stock sale as I wanted to keep the name with me and the other assets in the business. The buyer had to borrow more to deal with this added increase. This is very common any time a business is bought or sold.
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But that's not what we are talking about at all, NEOCON. I've dealt with it, but I didn't put it where you told me first. I hope that's okay.
 
#85
#85
utgibbs said:
But that's not what we are talking about at all, NEOCON. I've dealt with it, but I didn't put it where you told me first. I hope that's okay.
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It might not be in the context of what you were talking about but taxes are factor in all the time in a business cashflow. All the time. I just gave you one example.
 
#89
#89
utgibbs said:
That is absolutely not correct. Your entire argument is premised on this fallacy, volinbham.

In real capitalism, the smartest competitor would capture market share by keeping prices low. Smaller profit margins would be corrected with future market gain. Meanwhile, profits for corporations "passing on costs" would continue to decrease. This is Capitalism 101, people!

No, in real capitalism market share gains are transient. Market share gains are generally temporary and ability to charge above market prices depends on true differential advantage. Any firm making about market profit margins will draw more competition and thus differential advantage is eroded.


To maintain sufficient profits over time, corporations must price at a level that covers all operating costs plus taxes owed. To do so, taxes to be paid must be and are factored in to prices. Reducing the tax % absolutely lowers the impact and allows the same profit margins at lower prices.

Your "real capitalism" argument for price reductions and permanent market share gains is a fantasy. Real world data (which you are so fond of) points this out. If all it took was keeping prices low to effect massive and semi-permanent market share gains then we would see that. Of course, price changes are simple to copy and in the end all competitors end up at price parity. Without sufficient price above costs to cover taxation, there is no profit and therefore businesses cannot sustain shifts in market share or business cycles.

Now, if you are suggesting monopoly power allows those costs to be passed on, I might suggest you have a point (or, before realUT has a go at "monopoly" - a few large players with overwhelming market share).

But, of course, you dare not tread there lest the entire edifice starts to crumble.
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Monopoly is not a few large competitors - that is oligopoly. Even then, those positions are not permanent.

Airlines are perfect example of an oligopoly where no competitor can gain market share via price reductions alone. However, if airlines were not subject to corporate taxes on profits then airline prices across the board would come down.

Even in an oligopoly, reducing tax rates would have a downward impact on price.
 
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#91
#91
volinbham said:
Well technically the cost of making goods does have something to do with the tax on profits since the cost of producing is one key determinant of profit.

What you have done is what you've always claimed we do - you've shown that corporate taxes on profits do get passed through in prices and thus are paid by consumers and not corporations. Drop corporate taxes to zero and prices will come down. Raise corporate taxes and prices will go up.
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Absolutely. Competitors in their respective industries could not resist the urge to lower their prices if they knew it would give them a competitive advantage in the marketplace. And once the first one did it, the rest would follow suit in order to not lose market share.

Ever notice auto companies almost never sell their cars at actual MSRP? There's always some sort of rebate. I hardly think they WANT to do that, but rather they have to because one of their competitors always is and they have to follow suit.
 
#92
#92
utgibbs said:
....In real capitalism, the smartest competitor would capture market share by keeping prices low. Smaller profit margins would be corrected with future market gain. Meanwhile, profits for corporations "passing on costs" would continue to decrease. This is Capitalism 101, people!
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That makes no sense. What corporation stays in business without passing on cost?
 
#93
#93
The econ lessons in here are astounding. First, one metric as the lone arbiter is absurd and absolutely the route to Soviet style quality and innovation. Second, the idiocy about taxes not being a pass through expense are even dumber.
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#94
#94
BigPapaVol said:
The econ lessons in here are astounding. First, one metric as the lone arbiter is absurd and absolutely the route to Soviet style quality and innovation. Second, the idiocy about taxes not being a pass through expense are even dumber.
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Yawn. Typical BPV. If you'd just look at the real world outside the backdoor you'd realize it's already a GSM woodshed gorilla capital sewing circle convivial paduwan supermajority other words that are used without full comprehension of meaning.
 
#95
#95
kptvol said:
Yawn. Typical BPV. If you'd just look at the real world outside the backdoor you'd realize it's already a GSM woodshed gorilla capital sewing circle convivial paduwan supermajority other words that are used without full comprehension of meaning.
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We just don’t understand. The shrewd business is the one that sells their products below cost. The greater the difference between price and cost the greater their marketshare will be. Capitalism 101
 
#96
#96
VolDad said:
We just don’t understand. The shrewd business is the one that sells their products below cost. The greater the difference between price and cost the greater their marketshare will be. Capitalism 101
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And there is one smart competitor out there that will drop prices to gain market share - fortunately, all other competitors are too dumb to follow so the smart one ends up with massive market share. Those dumb SOBs never knew what hit em.

If that smart competitor is smart enough they drop prices so much they make no profit so they pay no taxes. Makes perfect sense.
 
#97
#97
VolDad said:
That makes no sense. What corporation stays in business without passing on cost?
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BigPapaVol said:
The econ lessons in here are astounding. First, one metric as the lone arbiter is absurd and absolutely the route to Soviet style quality and innovation. Second, the idiocy about taxes not being a pass through expense are even dumber.
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volinbham said:
And there is one smart competitor out there that will drop prices to gain market share - fortunately, all other competitors are too dumb to follow so the smart one ends up with massive market share. Those dumb SOBs never knew what hit em.

If that smart competitor is smart enough they drop prices so much they make no profit so they pay no taxes. Makes perfect sense.
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This has indeed been eye-opening to me. It means either one of two things:

1. Y'all approve of "market distortions" (all the while demanding a free market. Note volinbham's response), or

2. Y'all are truly confused about the real world outside the back door.

Taxes on profits are not costs. This is something every entrepreneur knows. They, of course, affect your after tax profits but they do not affect your profits.

In a true market, therefore, prices would be stable with an increase in tax rates, shall we go over the figures for corporate profitability from WWII to Nixon????????

As volinbham (at my suggestion) begins to hint at, could there be market distortions at work? :question:
 
#98
#98
utgibbs said:
This has indeed been eye-opening to me. It means either one of two things:

1. Y'all approve of "market distortions" (all the while demanding a free market. Note volinbham's response), or

2. Y'all are truly confused about the real world outside the back door.

Taxes on profits are not costs. This is something every entrepreneur knows. They, of course, affect your after tax profits but they do not affect your profits.

In a true market, therefore, prices would be stable with an increase in tax rates, shall we go over the figures for corporate profitability from WWII to Nixon????????

As volinbham (at my suggestion) begins to hint at, could there be market distortions at work? :question:
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Wow, was this pathetic. Who in the hell gives a crap about pretax profitability?

Every entrepreneur you know must be borderline retarded and you have no earthly idea what therefore means. See, real entrepreneurs are concerned with cash flow, hence the accounting term (profit) only matters for the purposes of calculating the freaking tax bill. If you'd like to proffer the idiotic argument that taxes are cash flow neutral, be my guest. If you really want to pretend that you are a businessman and that you're the lone one - please do, as it fits the remainder of your grand delusion.
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#99
#99
utgibbs said:
They, of course, affect your after tax profits but they do not affect your profits.
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Please tell all of us who are clearly not as smart as you what other kind of profit there is that matters to a business, especially a small one?
 
#100
#100
utgibbs said:
This has indeed been eye-opening to me. It means either one of two things:

1. Y'all approve of "market distortions" (all the while demanding a free market. Note volinbham's response), or

2. Y'all are truly confused about the real world outside the back door.

Taxes on profits are not costs. This is something every entrepreneur knows. They, of course, affect your after tax profits but they do not affect your profits.

In a true market, therefore, prices would be stable with an increase in tax rates, shall we go over the figures for corporate profitability from WWII to Nixon????????

As volinbham (at my suggestion) begins to hint at, could there be market distortions at work? :question:
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Unbelievable.
 
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