What will Happen with the Tax Cuts

[Vago]

http://www.foxbusiness.com/markets/2...s-economy.html

https://www.ft.com/content/674697de-...2-d7d59aace167

[Antiganon]

Like you said. It'll be great in the short-term but terrible when were in an even larger deficit hole (unless we cut services to the middle class and below). Cut 401K, medicare, SS, retirement age, and forms of welfare which will create more income inequality and societal decay. It's very short-sighted. Celebrate those extra 60 dollars each month in your paycheck in exchange for the country's future. Wooowee.

$60?

I get an extra $3.50 per week under this tax plan.

Then I give it all back, plus about $1600 more, because tax credits that I depend on are repealed.

[Vago]

This. All this.

Especially the part about token raises, which we've already seen with Walmart and AT&T's PR stunts to announce raises and bonuses at a time where the tax cuts haven't even affected their bottom line yet, while at the same time laying hundreds/thousands of people off.

Corporations know how to play the game, because they have been for a long time. Telecoms have been doing it by saying that they need net neutrality repealed so that they "will be able" to invest in infrastructure. Except net neutrality rules have zero to do with their ability to invest.

All tax cuts do is place far more burden on the middle and lower classes in the country while the wealthy continue to rent-seek in ever greater and more creative ways. Meanwhile wealth inequality will grow, crime rates will rise, the deficit will grow larger, binding the hands of the government from making any kind of infrastructure investments in the nation since neo-cons will cry that it'll recklessly increase the deficit even more (and future Democrat presidents will be blamed for all of it).

Meanwhile low-wage workers will still lose their jobs to automation, wages and job growth will still remain stagnant, and we'll continue to slip further and further down as a developed nation as we cut benefits programs, government backed research and development, and our quality of life will continue to suffer as previously subsidized programs like school lunches, day care, parks, civil services and more receive more and more cuts in order to balance out federal, state and local budgets.

So yeah, it's all gonna be awesome. Totally going to attract all those wealthy, educated white people from european nations this way.

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Correct, but also incorrect. The statutory corporate tax (the tax specified by law) in the US is the highest in the world at around 39.9%.

However, the effective rate paid by companies in America (after deductions, credits, etc) is only 18.6%, and is only the 4th highest.

Also, what's your point? Corporate taxes aren't the only form of taxes out there. There's also personal income tax, which suffers the same issue that corporate tax collection does - specifically, people making hundreds of millions of dollars paying a lower effective rate than someone making $40k a year.

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Also this.

Lowering taxes on corporations that have no profit motive or external pressures to increase wages or production will have zero benefit to the workers. Those tax cuts will go directly into the company's bottom line, which will then increase shareholder distributions, which is all CEOs are graded on.

The literal only way to stoke job growth and job creation is to increase demand. The literal only way to increase demand is to increase discretionary spending in the economy, which this tax cut will not do. However, lowering people's medical costs; making it easier/cheaper to buy housing; lowering the costs of services like college educations, child care, child rearing; giving people more money and free time to take vacations; things that increase consumer confidence by giving allowing them to feel financial secure / protected is what will stimulate and grow the economy, not doing the exact opposite.

Or you could simply make the US market competitive and with the same exact demand we have today bring back the jobs that were lost to other countries also bring back the offshore money and corporations being taxed on that such as Apple.

[melodramocracy]

First off, they will create jobs, at least in the short term.

Off on the wrong foot immediately.

[spanishninja]

They will not create jobs. Corporations are posting record profits, have been for years now. Most of those profits are coming from stock manipulation due to them having no incentive to utilize their revenue in other ways. Increasing their net profit is not going to suddenly change the rules of the game. They will engage in further stock by backs, engage in further attempts to circumvent worker protections, and engage in further lobbying to make both of those things easier. We may see some of them, at some point, put forth tiny %s of their total tax savings as token measures, like raises. Net job growth will not increase, net wage growth will remain flat.

Small businesses are actually the biggest employers in the country, and they will in fact be using their tax savings to drive growth. Unlike publicly traded corporations, small businesses can't afford to just sit on extra money. they have to spend it.

[unbound]

My long term predictions of how the recent GOP tax cuts for corporations will ultimately shake out.

First off, they will create jobs, at least in the short term. The majority of the new revenue created by the tax cuts that corporations will recieve will definitely go to boosting CEO pay and shareholders, but lesser amount will likely go to new projects and the creation of jobs. Everything will seem great for a moment, and republicans will have seemed to won and they will smear it in the face of democrats and lefties everywhere.

However, boom cycles do not last forever. After the tax cuts have run their course and the economy settles back to normal growth rates, there will be massively increased inequality in a country that already has a very large gap between the rich and the poor. This will lead to even greater levels of civil unrest than we see now.

Not learning their last lesson, conservatives/republicans will push for more tax cuts to corporations and the whole American political cycle will start anew.

This is not a sustainable in the long term. There is a limit to how much corporate taxes can be cut. What happens after corporations pay 0% in taxes? Do we start subsidizing them? How far must the upward funnel of wealth from the poor and middle class to the rich and corporations go until something changes?

Job creation will be rather modest, but you've already seen corporate PR push the meme that the tax cuts did things. Walmart's $11/hr pay raise (actually in response to Target doing that last year), bonuses that were already planned (including one negotiated by a union months prior), etc. Heck, Apple just announced capex plans that are supposedly due to the tax cuts...except that they originally announced those exact same plans back in November. Idiots will continue to fall for it.

As you said, the vast majority of the money will go to the top executives. Maybe there will be somewhat better raises for the next year or so. Importantly, the tax plan will have most people pay more taxes a few years down the road...but idiots don't think that far ahead.

This will also continue to push income inequality even higher. While the idiots are dancing around with their crumbs, they are completely ignoring the super-rich walking away with entire slices of pie.

But don't worry. I'm confident that Republicans will have some fresh story as to why, somehow, it is all Democrats fault.

[Vago]

As you said, the vast majority of the money will go to the top executives. Maybe there will be somewhat better raises for the next year or so. Importantly, the tax plan will have most people pay more taxes a few years down the road...but idiots don't think that far ahead.

Can you tell me how most people will pay more taxes? If they don't extend the plan then the tax rate revert back to EXACTLY what they are now. So people won't be paying more taxes than they paid last year, they may pay more than they will in 2018 and moving forward but lets not pretend as though it is a tax hike in x number of years because it is not.

[Zeek Daniels]

Hi my name is nanook12. And i have a negative opinion based on pure speculation. No optimism here!

[Zoldor]

The fact that someone else has more money than I do is not a problem that's the government's responsibility to solve. If it's a problem at all, it's mine to solve. Or to accept.

The problem with your thinking is that the corporations are using the government for exactly this purpose. To increase their wealth by using the government as the responsible entity. The government shouldn't be pittying the major corporations who aren't creating jobs, which isn't because of taxes it is because cheaper labor is elsewhere, the need for humans to do certain jobs is declining, the skill sets of the humans they need aren't being filled etc. But we give them the tax breaks anyways in hopes of trickle down working on another go round.

The government's job isn't to create equality and thinking that is wrong, the job is to balance the budget and afford the programs the government is expected to do, programs that benefit the people and as many of them as possible through various programs. Thinking the government is a business is wrong, it is there to uphold civilization and create an environment that harbors great success among its population.

The real problem is we are just going to bring in less money to the government forcing them to make sweeping budget cuts and destroying programs all to the benefit of corporations who weren't hurting. With the tax plan that has been in place we've seen economic growth all around, but somehow that isn't good enough (despite the DOW being up, corporations showing record profits etc) they need tax cuts to create new jobs and survive, I think not.

[bladeXcrasher]

Yes because someone from a red state has never shit all over California before.

Fly over states are generally ones without wealth, but thank you for reinforcing the point I made.

[Zoldor]

My prediction see 1981 Tax Cuts and all the tax increases that followed it, because you can't run a government like a start up business.

This. These cuts have been done before, we have a historical pattern of 30+ years in place. It is pretty obvious except to all those who voted, or, gasp, they don't care and stand to benefit in some fashion for repeating history over and over again.

[Vago]

The real problem is we are just going to bring in less money to the government forcing them to make sweeping budget cuts and destroying programs all to the benefit of corporations who weren't hurting. With the tax plan that has been in place we've seen economic growth all around, but somehow that isn't good enough (despite the DOW being up, corporations showing record profits etc) they need tax cuts to create new jobs and survive, I think not.

I disagree, we need to cut some budgets. For instance, IMO, paying almost 1 million dollars to watch mud snails mate is a bit over the top.

[vindicatorx]

Its almost as if we have a century of test!

Right... let's just destroy our economy as we continue to wait to for greedy corporate slime-bags to finally do the right thing right?

[Ghostpanther]

Things like this http://www.foxbusiness.com/markets/2...rm-report.html

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Right... let's just destroy our economy as we continue to wait to for greedy corporate slime-bags to finally do the right thing right?

Going to have to hurry up then. The market just set another all time record today when the Dow broke the 26000 mark.

[vindicatorx]

Things like this http://www.foxbusiness.com/markets/2...rm-report.html

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Going to have to hurry up then. The market just set another all time record today when the Dow broke the 26000 mark.

Yeah, the market did. They gained value, not you. The biggest companies had record breaking profits every year for the past how many years? Take a few advanced economics courses and tell me how this will play out based on how it normally does.

[oxymoronic]

the only part i find sad about all of this is, the economy is booming and doing things it never has yet some would have you believe we are living in dark times. and here is what is worse... we are due for a recession. it will come, and it will come during trumps presidency. these same people will be like "see we were right!". has dick to do with the policies trump has put in place. this stock market will drop hard and it will last 2-3 years then it will go back up right after(give or take a year) we elect a democrat president. those same people will be like "see we were right!". and i find all this very sad cause i know it has dick to do with any policy trump can put forward. he literally cannot win. well unless he finds a way to win 2020. and considering i didnt think he would win 2016 who knows.

[Stretchie]

Basically this. Companies don't hire people just to hire people, business does not work this way. Companies only hire to meet demand of their product or service. If this was the case especially with large corporations who are making record profits would be hiring more people or at least compensating people with a higher wage.

If they did any tax cuts towards businesses it should have been incentives to small businesses but our politicians are of course bought by large mulit-national corporations. I am pro small business tax cuts that would give them confidence to at least possibly invest back into their business.

I hate doing this but looking for the graph or link but Corporations used to pay more into our national revenue and now pay less in total money. So yes, we have to make up that revenue somewhere. I know the GOP loves to starve the beast so for anyone who believes in small government this is wildest dreams. Corporations/business getting big tax breaks, while also being able to cut programs that the see as people who live off the government.

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No it won't. We had a tax holiday and it didn't create jobs.

The last time companies got a break on overseas profits, it didn't work out well

I bet you are going to say that now that they are permanent that this will create more jobs. Again, businesses are not in the business to hire people. They are in the business to their bottom line. Especially large multi-national corporations are beholden to the bottom line and its shareholders.

Alot of this. As many of us do, we work in large corporations or at least smaller businesses and has anyone ever heard someone say "well profits are way up this year. Now we can hire a bunch of people if we need them or not!"? Perhaps if business was struggling and they couldn't afford to hire anyone they needed and now they can, that's possible but otherwise I don't see how lower taxes will create jobs in a healthy business.

Many of you manage budgets and/or have staff and can answer this better. When business is already ok, would a sudden larger budget make you hire more people you weren't already looking for?

[breadisfunny]

The Democrats are not in charge, the GOP is. They pushed for less revenue, it's time they pushed to make the cuts that should go along with it. This should have been done 35 years ago, but both parties kicked it down the road. We all know where the cuts really need to be made, but nobody has the balls to do it... Social Security, Medicare/Medicaid, and the defense budget. Those are the areas with the most funding to work with.

yes because cutting spending to programs that are essential to a lot of people's everyday lives is a great fucking idea. while your at it let's rename the united states to thunderdome.

[Ghostpanther]

Yeah, the market did. They gained value, not you. The biggest companies had record breaking profits every year for the past how many years? Take a few advanced economics courses and tell me how this will play out based on how it normally does.

I will be saving on money this year with reduced taxes. So yeah, the market is doing well and so am I along with most Americans. More money to spend back into the economy. I fail to see that as a bad thing. For those who are into the stock market, which millions of every day citizens are with their thrift saving plans, based on stocks, is also another positive.

[Logwyn]

The government already almost always runs out of money

But but they can just print more of it!!!!! (((SARCASM!!!!)