Where is the US economy headed?

I don't agree with all the spending, but spending is necessary.

cicerone imposter wrote:

I don't agree with all the spending, but spending is necessary.

Thats a whopper for sure. Why pay people that have an old junker sitting in their yard that they may not even hardly drive, why pay them to buy a new car? Stupid, stupid, stupid. Its a tax break for the rich. Nobody thats hard up should afford to buy a new car, no matter the credit or no. And besides, how manyof the idiots that don't have the money will be upside down on the new cars within a year?

Besides, how many dummies know not to buy a new car without a discount anyway? Its a gimmick, plain and simple, used by rich people or suckers, or a combination of both.

Good evening to yall. I would like to offer a little explanation of how corporations end up paying little if any Fed Income taxes despite showing big profits. Fox, Hawk and I chatted about that.
60% of corps, it was said, pay no tax. A bogus stat for reasons we discussed. Good headline-bad analysis.
Here, for what it is worth, is an explanation based on a few links Hawk provided from way back in 2001-2003.
I looked at several big companies. I ended up looking really closely at CSX, one of the big freight railways, based here in VA. The biggie for them was "depreciation." They bought a locomotive for $1M. Under GAAP (Generally Accepted Accounting Principles), they would charge as an expense 5% of the cost each year for the 20 year life-or $50K a year (I am obviously making this up; the last time I bought a locomotive was when I was 10 and it was from Lionel). But Congress instructed the IRS to allow "accelerated depreciation" for tax purposes. That locomotive could be written off against taxes in 5 years, say, or $200K a year.
Congress wanted CSX and other companies to buy locomotives and other capital intensive stuff.
Did I make everyone's eyes glaze over?
If you want to assign blame for "tax credits" taken by corporations, look not at the companies but at the legislators who routinely manipulate the tax code.

WASHINGTON (AP) -- The recession is starving the government of tax revenue, just as the president and Congress are piling a major expansion of health care and other programs on the nation's plate and struggling to find money to pay the tab.

The numbers could hardly be more stark: Tax receipts are on pace to drop 18 percent this year, the biggest single-year decline since the Great Depression, while the federal deficit balloons to a record $1.8 trillion.

Other figures in an Associated Press analysis underscore the recession's impact: Individual income tax receipts are down 22 percent from a year ago. Corporate income taxes are down 57 percent. Social Security tax receipts could drop for only the second time since 1940, and Medicare taxes are on pace to drop for only the third time ever.

The last time the government's revenues were this bleak, the year was 1932 in the midst of the Depression.

"Our tax system is already inadequate to support the promises our government has made," said Eugene Steuerle, a former Treasury Department official in the Reagan administration who is now vice president of the Peter G. Peterson Foundation.

Quote:

WASHINGTON (AP) -- The recession is starving the government of tax revenue, just as the president and Congress are piling a major expansion of health care and other programs on the nation's plate and struggling to find money to pay the tab.

The numbers could hardly be more stark: Tax receipts are on pace to drop 18 percent this year, the biggest single-year decline since the Great Depression, while the federal deficit balloons to a record $1.8 trillion.

Other figures in an Associated Press analysis underscore the recession's impact: Individual income tax receipts are down 22 percent from a year ago. Corporate income taxes are down 57 percent. Social Security tax receipts could drop for only the second time since 1940, and Medicare taxes are on pace to drop for only the third time ever.

The last time the government's revenues were this bleak, the year was 1932 in the midst of the Depression.

"Our tax system is already inadequate to support the promises our government has made," said Eugene Steuerle, a former Treasury Department official in the Reagan administration who is now vice president of the Peter G. Peterson Foundation.

http://finance.yahoo.com/news/AP-ENTERPRISE-Biggest-tax-apf-2967547650.html?x=0&sec=topStories&pos=3&asset=&ccode=

They can't continue to keep lowering taxes while they spend more today to transfer these ever increasing deficits to future generations.

It's wrong.

Sounds like time to RAISE TAXES, Christ, how hard is this to figure out?

But if we are going to slow down the financial sector then we need to take much bigger cuts in the form of taxes each time wealth moves. However, nobody is prepared to attempt to sell these large taxes to the American people.

well... hopefully, Hopefully, HOPEFULLY dealerships are qualifying buyers before turning over the new vehicles for the clunkers. I'm on the fence on this program, okie. I understand the idea, but I'm skeptical that the auto dealers aren't writing financing deals that don't make sense today any more than they made sense two years ago.

Sorry, hawk, some of that post went by me; particularly the quote above. "each time wealth moves." Nice phrase, but I missed the point.