Things just keep getting rougher for average citizens in Europe. Some have faced government seizure of accounts to help fund government operations and requirements that they explain withdrawals to their banks. Now, the European Central Bank (ECB) is imposing a negative interest rate on banks for their deposits. So, you can keep your money under your mattress or put it in a bank where the bank will use it to earn money while charging you for the pleasure. This is of course the central bank which directly relates to individual banks as opposed to individual depositors. Those banks will now pay to park their money and those costs will be passed along to depositors. Banks are likely going to try to hide the fact that the interest rate is now negative through fees and other measures.
The ECB cut the rate on its deposit facility for banks from 0 percent to minus 0.10 percent. It also cut its main interest rate to from 0.25 percent to 0.15 percent as well as cutting the rate on its marginal lending facility by 35 basis points to 0.4 percent from 0.75 percent.
It is an interesting situation where banks will now be treated as solely a safe place for holding your money but you will pay for the service as a fee. Much like the airlines where aspects of what was once viewed as the basic service are being converted into fees, banks will now be treated as akin to a safety deposit box. However, unlike airlines or safety deposit boxes, the banks are making money off the deposits. It is a fundamental change in function of banks.
I have long been critical of the tax increases and measures in Europe that will likely have displacement impacts on investments and movement of citizens and businesses. In this case, I would expect people to look for alternatives from Internet banks to foreign banks.
Darren, Your poll question was perfect. And, it brought out the usual replies. It’s the old saying, “Don’t tax you, don’t tax me, tax the man behind that tree.” We need a radical and fundamental change in our tax structure in this nation. Above all else, it needs to be simplified. There is more lobbying done regarding taxes than any other issue.
On this topic, the IRS on instructions from the WH, is looking into ways to tax Frequent Flyer miles and Hotel points! That might be the final straw. Few folks know of one of the few successful tax revolts. During WW2 FDR placed a freeze on wages. Employers were having a difficult time w/ morale and keeping good people. So, they started giving them the perk of free health insurance. After a year, FDR had the IRS start taxing that benefit. The backlash was swift, righteous and severe. FDR had the IRS back off and that’s how health insurance became tied to employment.
Paulette already pointed out the unfairness of the flat tax for the poor and middle class. Steve Forbes loves a flat tax. Or maybe you’ll be lucky and Herman ‘999’ will run again. Herman was brilliant – particularly on foreign policy.
Paul S
Not my real name? Whatever makes you believe that? As for what rate I pay in taxes, I keep copies here. You could break in and steal them.
Why don’t you post your tax returns. You could do them as a pdf. Just black out the pertinent personal data. And I see no reason why the poor should not pay taxes as long as the rate is the same. That way everyone has ‘skin in the game.’
Karen
Of course people would still make money on capital gains if they were taxed at a higher rate. I know this because I have investment income. I know this because I have sold a house.
What Karen, Darren and Slohrss29 said
Cause and effect.
A luxury tax was imposed on items such as yachts and private planes. Do you know what happened? It destroyed the shipbuilding and small plane building industries. A lot of jobs were lost. The rich bought foreign boats, which benefitted other countries. And then they docked them there to save more money.
Cause and effect. But too often, people do not research the actual outcome of their vote and act accordingly next time.
http://www.fee.org/the_freeman/detail/shipwrecked-in-new-jersey
Those who have claimed are willing to pay more, you actually CAN pay more on your taxes. You can elect to send in more to go towards paying down the deficit. If you think your tax rate is 10% too low, then send in another 10% of your income. If you really are willing to pay more, then please pay more.
Paulette:
Many people in the middle class don’t have money to make money now. If the threshold for Welfare was increased so that the net income stayed the same for the poor, then there is no net difference for them.
And, literally, it would be “equitable” for the wealthy. Equitable meaning fair, impartial, and equal. Because right now, the wealthy are a minority. And the majority almost ALWAYS votes to increase taxes for other people that won’t affect them. That is neither equal nor fair. And that is how the 95% UK tax rate came about. If voting for higher taxes raised your own, we would be more cautious. We would care more when our government wasted our money. We would demand accountability. But when 2/3 of it is other people’s money, that’s when we have potholed streets and gridlock, while we spend billions of dollars on a vacation train to San Francisco with projected low ridership. We waste buckets of money that could have been used elsewhere.
How else can we change the “us and them” mentality? This is the only way I know of. If we cannot or will not rein in our compulsive tax and spend, then the only solution I can see is a flat tax, to get people out of their stupor and start voicing an opinion about bloated government waste.
And, yes, there is a lot of military waste, too. I would never weaken our armed forces. But there was a scandal where a politician got a contract renewed for one of the towns in his district to keep making tanks the military no longer needed. They wanted to end the contract, but it was an important source of revenue for the town. Instead of getting creative and finding another source of revenue, this politician used back door deals to get this useless contract through and keep making these tanks. So easy to spend other people’s money.
Oh, and I think politicians should not be exempted from any of the laws they pass.
Shuler – that’s right. The wealthy buy more and would pay more with a flat sales tax.
We already pay a lot in a flat sales tax, but not too many people complain about it being across the board. And if welfare was increased so that the net take-home money stayed the same, what’s the difference if we imposed a flat income tax? The poor would have exactly the same money they did before with the increase in benefits, but now we’re all pulling together.
Romney’s income is investment income. Why would he pay a different tax rate than the capital one? During other times of his life, he had wage income, and paid that rate.
The government sets that rate because if it was any higher, no one would make any money on investments so they would not do it. So when people say investment income should be taxed more, there would be real consequences to that.
Here is fact check – Romney’s income tax rate is actually higher than 97% of Americans. In order to make it lower, you have to combine other taxes that wage earners pay, including the payroll tax, but NOT count any other things that Romney pays for.
And, again, at this time of his life, it’s investment income. Retirees often live on investment income. This was a manufactured outrage. Unless you’re going to snarl at all people living off investment income, including retirees, or you want to get rid of investments. But don’t criticize someone for paying investment tax.
http://www.factcheck.org/2012/08/does-romney-pay-a-lower-rate-in-taxes-than-you/
And I’ll take that poll on how many Americans want to pay higher taxes!
I have had many jobs over the years. The jobs have left. I work for myself. I am far from rich. Before anyone else posts about someone else paying taxes, I invite them to start a business from scratch. Lie awake wondering if that last problem is going to keep you from being able to pay a mortgage payment, let alone quality food, and other necessities for your family. Then consider while trying to make this money needed, you are still responsible for paying 36% and more of what you are anticipated to make for a quarter. Someone decides not to pay? Figure it out, and it ain’t pretty. Just because you have a business doesn’t mean you get up in the AM and start picking up the cash that happens your way. I invite you to try to live that life before you continue to commit others to paying more tax.
Darren,
I think you are mistaken in believing that there are no Americans who are at ease with paying their tax bills. I’ll cede you ‘happy’. Filing is a chore. It will be better when the IRS just sends most of us a bill.
I moved from low tax AZ to a state that has high taxes. It was okay with me. I learned a long time ago that I am not unique. There are others out there who agree with me. There would be more, if we could ever turn off the propaganda machine. Heck, I even remember when regular people didn’t think there was anything wrong with estate taxes. But turn it into a ‘death tax’ and watch the Furies dance. Convince them that government run healthcare is a communist plot, and watch the signs at Tea Party rallies pop up warning of government hands on Medicare.
I believe I lost a perfectly good comment. Can it be retrieved?
Angryman speaks. I have had to delete comments in volition of our civility rule as containing repeated personal insults and attacks.
Angrymanspeaks, I have had to delete another two comments for personal attacks. If you cannot comply with the civility rule, we will have to suspend further comments. Please avoid further violations.
Not sure which thread; possibly the president trades five for one
Essentially when it comes down to it, how many people truly in their own minds are happy when they receive their property tax bill or any other form of taxation? How many people actually think to themselves, as opposed to what they tell others, that they feel cheated because they didn’t get charged more tax?
You know, that is the way most people are. Yet, there are also so many that proclaim and believe that someone else should pay more taxes. But that someone else also has the same philosophy. So there it is.
Taxes are like any other expense, people and businesses try to minimize or eliminate it if possible. Few see the need to buy the more expensive widget when the identical one is next to it for less money. Or even not buy a widget because it can be substituted for less money or not purchased. Most people do not want to pay more for a widget.
The same cost cutting is found in driving a car, they don’t buy the super-unleaded unless they have to. The don’t keep the a/c on in their house when they go away for a three week vacation. It is just a matter of cost savings. But, if someone else can be conned into paying for our expenses, it is usually more desirable.
1. The rich are not overtaxed.
2. The primary function of all taxation is redistribution.
3. The public policy issue is to whom or to what tax dollars should be redistributed. That in turn requires a reasonable consensus on the proper function(s) of government. It is at this level that all of the acrimony kicks in.
4. Discussions concerning tax rates are meaningless in the absence of agreement on the purposes for which taxes ought properly be imposed.
Mike Appleton wrote: “2. The primary function of all taxation is redistribution.”
Can you develop this thought further? Who teaches this principle? Did you learn this principle at Harvard?
Mike Appleton wrote: “4. Discussions concerning tax rates are meaningless in the absence of agreement on the purposes for which taxes ought properly be imposed.”
Exactly right!
Paulette
I stopped when I saw Walmart was #3. I love subsidizing Walmart. You know – the guys who provide all those high paying jobs to thousands. And contract with manufacturers in East Asia.
Wonderful Americans.
John,
I found your comment at 12:48am in the spam filter.
Paulette and feynman,
Yes, thank you, makes good sense.
paulette,
I did not see my name on the list of lucky subsidy recipients! I guess I need to get a job and get rich before I am entitled to a subsidy.
Don’t read this before you go to sleep. Save it for when you need to get your blood pumping. http://www.goodjobsfirst.org/sites/default/files/docs/pdf/subsidizingthecorporateonepercent.pdf
On second thought….it may have been operating just fine!