House GOP proposal would cut Met Coun...

House GOP proposal would cut Met Council funding by $120M; $7 Metro Transit rides?

There are 331 comments on the TwinCities.com story from Mar 25, 2011, titled House GOP proposal would cut Met Council funding by $120M; $7 Metro Transit rides?. In it, TwinCities.com reports that:

Would you pay $7 per trip to ride a Metro Transit bus across town? Probably not.

Join the discussion below, or Read more at TwinCities.com.

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MNBeliever

United States

#338 Apr 11, 2011
Sideshow Bob wrote:
<quoted text>It is taxing behavior differently, if lawyer A works harder or picks a better field of practice, Lawyer A pays a greater share of his/her salary in income taxes. You are taxing Lawyer A more for working harder, and taxing Lawyer B less for choosing a less lucrative field or not working as hard. I can point out many lawyer acquaintances that have made a choice to pursue less lucrative practices or just choose to work less hours, and make less.
No it is not promoting behavior. Lawyer A may work just as hard as Lawyer B. In fact, Lawyer A may do the EXACT same work as Lawyer B, but is just not as a good of a lawyer as Lawyer B. or doesn't have clients willing to pay rates as high as Lawyer B. Progressive taxation does not promote behavior or social policy. It doesn't provide incentives for people to work less. Most people if asked if they would prefer to make $500k and pay an effective tax rate of 30% vs.$50k at an effective tax rate of 15% would ALWAYS choose the $500k salary. Why? Because at the end of the day you are bringing home $350k vs.$42.5k in after tax income. Even if we bumped up the effective tax rate to say 50%- so the after tax spread is $250k v.$42.5k. I think you would agree that there would be limited to no people who would choose the $50k salary.
MNBeliever

United States

#339 Apr 11, 2011
Sideshow Bob wrote:
<quoted text>My argument about paying back the principal on loans on a schedule and not having enough left over to cover tax liability stands. Most business loans are written on a 5 - 7 year amortization,so the principal gets paid back faster than say, a home loan, and that money is not able to be used to grow the business or pay taxes. But you want to tax small business owners at a higher rate, making it even harder to make those loan payments.(yes, principal repayment is part of the loan, so it quickly becomes a cash flow issue.)
I don't disagree with what you've said, but your alternative at a "wealth" tax is an impractical solution. I don't understand what is so controversial about having to pay taxes on your profit prior to principal repayment? That is the way accounting works. I would venture to say that most companies taking out loans are either (i) recent start-ups or (ii) looking at expansion/investments. In either case, the company borrows money because it believes that it will improve its financial position and ultimately lead to increased profits. The company then must pay taxes on the profit it makes - which of course is going to reduce the after-tax profit that it either re-invests or pays to the members/shareholders of the company.

A wealth tax would simply encourage everyone to incur additional debt so as to reduce net worth and avoid higher taxes. Are there any models for this type of tax scheme?
Sideshow Bob

South Saint Paul, MN

#340 Apr 11, 2011
MNBeliever wrote:
<quoted text>
I don't disagree with what you've said, but your alternative at a "wealth" tax is an impractical solution. I don't understand what is so controversial about having to pay taxes on your profit prior to principal repayment? That is the way accounting works. I would venture to say that most companies taking out loans are either (i) recent start-ups or (ii) looking at expansion/investments. In either case, the company borrows money because it believes that it will improve its financial position and ultimately lead to increased profits. The company then must pay taxes on the profit it makes - which of course is going to reduce the after-tax profit that it either re-invests or pays to the members/shareholders of the company.
A wealth tax would simply encourage everyone to incur additional debt so as to reduce net worth and avoid higher taxes. Are there any models for this type of tax scheme?
Its called and estate tax or death tax.

Principal gets repaid every month as part of the loan payment. You don't get to pay your taxes on profit and use what is left to pay the principal. As such, I have not been able to take any money out of my business the past 5 years, I have even had to kick more in to make tax payments. In two more years when my loan is done, I will have to take out another loan to update my equipment, and once again, no money available. Those of you who do not run small businesses with everything at risk have no idea of the problems of keeping one afloat, you just feel we aren't "paying our fair share". My fair share is that every one of my employees has made far far more than I have these past 5 years, and due to the economic downturn, the value of the business is approximately $140,000, about what I used to make in a year working for someone else. That whole "fair share" mentality is going to kill off small business start ups.
Sideshow Bob

South Saint Paul, MN

#341 Apr 11, 2011
MNBeliever wrote:
<quoted text>
No it is not promoting behavior. Lawyer A may work just as hard as Lawyer B. In fact, Lawyer A may do the EXACT same work as Lawyer B, but is just not as a good of a lawyer as Lawyer B. or doesn't have clients willing to pay rates as high as Lawyer B. Progressive taxation does not promote behavior or social policy. It doesn't provide incentives for people to work less. Most people if asked if they would prefer to make $500k and pay an effective tax rate of 30% vs.$50k at an effective tax rate of 15% would ALWAYS choose the $500k salary. Why? Because at the end of the day you are bringing home $350k vs.$42.5k in after tax income. Even if we bumped up the effective tax rate to say 50%- so the after tax spread is $250k v.$42.5k. I think you would agree that there would be limited to no people who would choose the $50k salary.
At the lower income spectrum, the child credit keeps some low income workers from exceeding certain income because make $1 over the cut off, and that child credit goes away. That is behavior, modified by the progressive tax code.
Sideshow Bob

South Saint Paul, MN

#342 Apr 11, 2011
MNBeliever wrote:
<quoted text>
I don't disagree with what you've said, but your alternative at a "wealth" tax is an impractical solution. I don't understand what is so controversial about having to pay taxes on your profit prior to principal repayment? That is the way accounting works. I would venture to say that most companies taking out loans are either (i) recent start-ups or (ii) looking at expansion/investments. In either case, the company borrows money because it believes that it will improve its financial position and ultimately lead to increased profits. The company then must pay taxes on the profit it makes - which of course is going to reduce the after-tax profit that it either re-invests or pays to the members/shareholders of the company.
A wealth tax would simply encourage everyone to incur additional debt so as to reduce net worth and avoid higher taxes. Are there any models for this type of tax scheme?
Your camp, if I may be so bold as to put you in that camp, advocates for taxing the wealthy, so they pay their "fair share". Just having a high income does not equate to being "wealthy", at least not in the short term. Think wealthy retirees, trust fund babies(aka Mark Dayton, almost any Kennedy, etc.), they minimize the income they take to minimize their payments, no different than General Electric. That is the group that holds the wealth, not the newly graduated doctors that have $750,000 in student loans, etc. Fair is a flat tax where everybody pays the same amount. Any other system has inequality built into it somewhere, high, middle, or low income, one or all gets shafted in a progressive/regressive tax system.
MNBeliever

United States

#343 Apr 11, 2011
Sideshow Bob wrote:
<quoted text>Its called and estate tax or death tax.
Principal gets repaid every month as part of the loan payment. You don't get to pay your taxes on profit and use what is left to pay the principal. As such, I have not been able to take any money out of my business the past 5 years, I have even had to kick more in to make tax payments. In two more years when my loan is done, I will have to take out another loan to update my equipment, and once again, no money available. Those of you who do not run small businesses with everything at risk have no idea of the problems of keeping one afloat, you just feel we aren't "paying our fair share". My fair share is that every one of my employees has made far far more than I have these past 5 years, and due to the economic downturn, the value of the business is approximately $140,000, about what I used to make in a year working for someone else. That whole "fair share" mentality is going to kill off small business start ups.
We are all familiar with the way that loans work. It sounds like you run a business that isn't profitable. Sometimes reality is harsh. You should forgo the capital improvements after you finish paying off your existing loan and return the profit to yourself for a few years - that or you need to increase your revenues by some manner.

Enough with the self-pity about paying your employee's more than you're paying yourself for 5 years now. If work is so much more profitable as an employee, then go become an employee for someone else's business.

The fair share argument is NOT aimed at small businesses - and in fact, I don't think anyone has suggested that small businesses aren't paying their fair share. Large corporations have rigged the system. The only way we are going to solve the deficit/debt problem is to increase revenues at the federal/sate levels, which will require tax increases. The question is to whom should these tax increases be aimed.
MNBeliever

United States

#344 Apr 11, 2011
Sideshow Bob wrote:
<quoted text>At the lower income spectrum, the child credit keeps some low income workers from exceeding certain income because make $1 over the cut off, and that child credit goes away. That is behavior, modified by the progressive tax code.
No I would disagree - that is behavior modified by the tax credit itself, not by the progressive tax structure itself.
Sideshow Bob

South Saint Paul, MN

#345 Apr 11, 2011
MNBeliever wrote:
<quoted text>
We are all familiar with the way that loans work. It sounds like you run a business that isn't profitable. Sometimes reality is harsh. You should forgo the capital improvements after you finish paying off your existing loan and return the profit to yourself for a few years - that or you need to increase your revenues by some manner.
Enough with the self-pity about paying your employee's more than you're paying yourself for 5 years now. If work is so much more profitable as an employee, then go become an employee for someone else's business.
The fair share argument is NOT aimed at small businesses - and in fact, I don't think anyone has suggested that small businesses aren't paying their fair share. Large corporations have rigged the system. The only way we are going to solve the deficit/debt problem is to increase revenues at the federal/sate levels, which will require tax increases. The question is to whom should these tax increases be aimed.
It didn't sound like you knew how loans worked from your previous posting, saying I should pay the taxes first on the income before paying my principal.

Revenue doesn't need to be increased, spending needs to be curtailed.

As for my business, Dayton's proposed taxes would hit my business hard. I want to go back to being an employee on many levels, but I would have a problem turning 16 employees out into the street. As for large corporations rigging the system, small businesses provide more jobs and more revenue for the government than all the large corporations combined. They are the backbone of the country, and the progressives trying to target the few large businesses end up taking out small businesses with their unfriendly business ideas. If you doubt it, just look at the provisions in the new healthcare bill. There are incentives in it to not pay any companies over $600 per year(reporting requirements), and not to get over 50 employees in size(health care plan penalties), as well as other poison pills for small businesses. Good thing we can read it after it is law to find out what is in it.
MNBeliever

United States

#346 Apr 11, 2011
Sideshow Bob wrote:
<quoted text>It didn't sound like you knew how loans worked from your previous posting, saying I should pay the taxes first on the income before paying my principal.
Revenue doesn't need to be increased, spending needs to be curtailed.
As for my business, Dayton's proposed taxes would hit my business hard. I want to go back to being an employee on many levels, but I would have a problem turning 16 employees out into the street. As for large corporations rigging the system, small businesses provide more jobs and more revenue for the government than all the large corporations combined. They are the backbone of the country, and the progressives trying to target the few large businesses end up taking out small businesses with their unfriendly business ideas. If you doubt it, just look at the provisions in the new healthcare bill. There are incentives in it to not pay any companies over $600 per year(reporting requirements), and not to get over 50 employees in size(health care plan penalties), as well as other poison pills for small businesses. Good thing we can read it after it is law to find out what is in it.
Revenue needs to be increased. We've already cut taxes dramatically under President Bush, only to have the deficit/national debt increase. Tax cuts simply aren't an efficient means of stimulating additional revenue to the government.

The health care debate is separate and apart from taxation. I am not looking to get into the health care debate. Progressives want the health care law because health care should be available to everyone - we are a wealthy nation that CAN afford to pay for basic health care for everyone (in our view, we mi-sallocate our resources, with defense spending being the primary culprit). Progressives aren't for health care as a way to stick it to big or small businesses.

Small businesses should have been behind the single payer model - the fact that health insurance is tied to employment makes no sense.
Sideshow Bob

South Saint Paul, MN

#347 Apr 11, 2011
MNBeliever wrote:
<quoted text>
Revenue needs to be increased. We've already cut taxes dramatically under President Bush, only to have the deficit/national debt increase. Tax cuts simply aren't an efficient means of stimulating additional revenue to the government.
The health care debate is separate and apart from taxation. I am not looking to get into the health care debate. Progressives want the health care law because health care should be available to everyone - we are a wealthy nation that CAN afford to pay for basic health care for everyone (in our view, we mi-sallocate our resources, with defense spending being the primary culprit). Progressives aren't for health care as a way to stick it to big or small businesses.
Small businesses should have been behind the single payer model - the fact that health insurance is tied to employment makes no sense.
Single payer means government run. The government can't control the rampant fraud(yes, rampant fraud) present in the medicare/medicaid program, so we should give them the whole healtcare industry to mess up. Countries with government run single payer systems are starting to move away from them, Great Britain being one example. Defense spending isn't the only culprit in misallocation of funds, although there is definitely waste and fraud in the defense budget. Cut first. Prove that the revenue is inadequate. Government shouldn't be all things to all people, and it shouldn't keep growing unchecked.

Since: Feb 08

Sandstone MN

#348 Apr 11, 2011
This whole equal percentage thing is a false argument.

"From each according to their means," is not one of the values of the founders. Then again, the founders never considered "To each according to their needs," either.

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