What exactly IS the point of a two-month extension of the Payroll tax cut?

[Little-Acorn]

Boehner has been pointing out that it provides nothing that companies, individuals etc. can plan on. It merely "kicks the can down the road" for a brief time, and the whole fight has to begin again almost immediately.

He has a point.

Anybody?

[fj1200]

^Political pandering and a way for Democrats to position themselves as the party of tax cuts for most of the people. No matter that there is no long term benefit and it sells SS down the river.

[Kathianne]

All true. The democrats laid a trap and the republicans had to walk into it. We'll see if the voters are smart enough to see it for what it was, down the line. More people are paying attention.

[Little-Acorn]

Republicans: Lets extend it for a year.

Dems: No, we only want to extend it for two months.

Republicans: Thats stupid.

Dems: See! Republicans want to raise taxes on the middle class!

Media: What the Democrats said.

.

.

(originally posted by Iggy on another forum)

[Little-Acorn]

And sure enough....

Apparently Mr. Hoyer has already forgotten that the Republicans he's shouting at, already HAVE passed an extension of the payroll tax cut. A longer one, even, than the penny-ante one the Democrats passed in the Senate.

Or perhaps he's trying hard not to remember?

Doublethink is a wonderful thing. Now, suddenly, it's all the Republicans' fault, somehow.

-------------------------------------------------------

http://www.foxnews.com/politics/2011/12/20/holiday-showdown-over-payroll-tax-tests-obama-gop/

GOP Adjourns House as Dems Move to Call Up Senate Tax Cut Bill

Published December 21, 2011


WASHINGTON – House Democrats were fuming Wednesday after Republicans adjourned the chamber just as Democrats were trying to bring up the Senate-passed payroll tax cut bill, a two-month extension that Republicans effectively rejected in a vote the day before.

House Democratic Whip Steny Hoyer was cut off as he tried to call up the Senate bill for a vote. In an unusual scene, the presiding Republican in the chamber adjourned the chamber until Friday and walked out while Hoyer continued shouting on the floor for the House to vote "to extend the tax cut for 160 million Americans."

"You're walking out," Hoyer said as officials left the chamber. "You're walking away. Just as so many Republicans have walked away from middle-class taxpayers."

[DragonStryk72]

Boehner has been pointing out that it provides nothing that companies, individuals etc. can plan on. It merely "kicks the can down the road" for a brief time, and the whole fight has to begin again almost immediately.

He has a point.

Anybody?

See, now I do like the idea of dropping or cutting the Payroll tax, but I would have made it contingent on companies increasing the size of their workforce by a certain percentage in order to qualify for the cut.

[fj1200]

See, now I do like the idea of dropping or cutting the Payroll tax, but I would have made it contingent on companies increasing the size of their workforce by a certain percentage in order to qualify for the cut.

Correct me if I'm wrong but the cut goes to the employee, not the employer.

[DragonStryk72]

Correct me if I'm wrong but the cut goes to the employee, not the employer.

Payroll taxes are the taxes that employers have to pay in order to pay you, the various matching funds on SS and whatnot, so really, businesses take a hit anytime they hire new people. Just chucking more money on the pile is useless, as that little bit per person isn't going to really add up, but give the hiring folks a break contingent on hiring more, and you'll see a marked improvement in the unemployment rate. With more people working and getting ahead of, or at least meeting, their bills, you'll see more spending, and the recovery would be doing a whole lot better than it is now.

With a blanket deduction that requires nothing of businesses to earn it, they'll simply hold on to the extra money to stockpile due to their feelings about the state of the economy, pretty much just continuing the cycle.

Federal Withholding taxes are the ones that are taken out of your paycheck.

[fj1200]

Payroll taxes are the taxes that employers have to pay in order to pay you, the various matching funds on SS and whatnot, so really, businesses take a hit anytime they hire new people. Just chucking more money on the pile is useless, as that little bit per person isn't going to really add up, but give the hiring folks a break contingent on hiring more, and you'll see a marked improvement in the unemployment rate. With more people working and getting ahead of, or at least meeting, their bills, you'll see more spending, and the recovery would be doing a whole lot better than it is now.

With a blanket deduction that requires nothing of businesses to earn it, they'll simply hold on to the extra money to stockpile due to their feelings about the state of the economy, pretty much just continuing the cycle.

Federal Withholding taxes are the ones that are taken out of your paycheck.

I know payroll taxes but I understand this particular cut to be on the employee side of the equation. I believe they already tried what you propose to useless effect as are temporary, rebate-type tax cuts. At least two prior tax rebates have gone out, one Bush, one Obama, and they are straight to deficit budget choices, nothing in them incentivizes long term investment. What is required is lowering long term tax rates without fear of expiration in a year or two, that and seriously streamlining the regulatory environment. Actually I think we really need to attack the corporate rate more than the income rate at this point.

[ConHog]

I know payroll taxes but I understand this particular cut to be on the employee side of the equation. I believe they already tried what you propose to useless effect as are temporary, rebate-type tax cuts. At least two prior tax rebates have gone out, one Bush, one Obama, and they are straight to deficit budget choices, nothing in them incentivizes long term investment. What is required is lowering long term tax rates without fear of expiration in a year or two, that and seriously streamlining the regulatory environment. Actually I think we really need to attack the corporate rate more than the income rate at this point.

Or just scrap the entire income tax system and start over.

[fj1200]

^OK.

[DragonStryk72]

I know payroll taxes but I understand this particular cut to be on the employee side of the equation. I believe they already tried what you propose to useless effect as are temporary, rebate-type tax cuts. At least two prior tax rebates have gone out, one Bush, one Obama, and they are straight to deficit budget choices, nothing in them incentivizes long term investment. What is required is lowering long term tax rates without fear of expiration in a year or two, that and seriously streamlining the regulatory environment. Actually I think we really need to attack the corporate rate more than the income rate at this point.

Well, look, we'd both be happy with them switching to The Fair Tax, but it's not likely to happen right now. The problem with prior rebates to the payroll tax is that business isn't required to do anything, so they can just pocket the money without hiring anyone, which is supposed to be the point of dropping the payroll tax, and what I'm talking about doing is business side, not employee side. You set standard that the businesses have to increase their non-temp, regular employee base by at least 10%, just for sake of example. This means they can't just hire people on to get the discount, but have to actually retain employees.

[fj1200]

Well, look, we'd both be happy with them switching to The Fair Tax, but it's not likely to happen right now. The problem with prior rebates to the payroll tax is that business isn't required to do anything, so they can just pocket the money without hiring anyone, which is supposed to be the point of dropping the payroll tax, and what I'm talking about doing is business side, not employee side. You set standard that the businesses have to increase their non-temp, regular employee base by at least 10%, just for sake of example. This means they can't just hire people on to get the discount, but have to actually retain employees.

It's NOT a business tax cut, it's an employee tax cut, the business isn't pocketing anything. And the problem with rebates is that they do nothing to stimulate economic growth. They've also tried tax schemes to get employers to hire which are also pointless because businesses don't hire to get a tax break, they hire when they need labor.

[logroller]

It's NOT a business tax cut, it's an employee tax cut, the business isn't pocketing anything. And the problem with rebates is that they do nothing to stimulate economic growth. They've also tried tax schemes to get employers to hire which are also pointless because businesses don't hire to get a tax break, they hire when they need labor.

Such pertinent details don't matter in policy consideration FJ, you know that. 'Shovel ready jobs' man, that's the call to arms...they can just stand around with a shovel, so long as they get breaks, and healthcare coverage, and unemployment for when they lose their jobs because they don't need the labor...ah shit, that labor demand thing is pesky-- i know, just shift the supply curve down by paying them to not work, not years or anything, just for couple of months while we think about it some more and keep the economy in limbo.


PS I feel like I'm working on talking points for a job interview at the DNC.:laugh:

[DragonStryk72]

It's NOT a business tax cut, it's an employee tax cut, the business isn't pocketing anything. And the problem with rebates is that they do nothing to stimulate economic growth. They've also tried tax schemes to get employers to hire which are also pointless because businesses don't hire to get a tax break, they hire when they need labor.

Okay, I wasn't talking about private side. You're correct, private does nothing, but I was explaining my reason for the way I would do it. A company decides it's labor based on potential influx of profit. Now if they can stand to make money, they hire based upon that line of thinking, and many businesses are "hiring", meaning that they are looking for people, but they're waffling because they don't see enough gain on the investment in a new worker. Then there are the businesses that right now want/need more people but simply can't afford the extra payroll tax money that would be tacked on to what they actually said new worker. With a built in way to cut an expense based around employing more folks, this can tip the scale on those businesses, and allow them to hire on, but only if it rewards business for doing it.

[red states rule]

See, now I do like the idea of dropping or cutting the Payroll tax, but I would have made it contingent on companies increasing the size of their workforce by a certain percentage in order to qualify for the cut.

Companies do not hire to get a tax cut - they hire because there is a demand for their service so the employer can make a profit off the work of the employee

BEsides this is not a tax "cut". It is temp tax credit and business are very worried about the future. Remember some of those taxes in Obamcare are about to hit 1/1/12

[red states rule]

When I hear what liberals think help the economy, I am amazed anyone ever votes for a Dem

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[LuvRPgrl]

Boehner has been pointing out that it provides nothing that companies, individuals etc. can plan on. It merely "kicks the can down the road" for a brief time, and the whole fight has to begin again almost immediately.

He has a point.

Anybody?

Merry Christmas acorn.

Even though Im not "anyone" cuz im a nobody, I ll give my opinion anyways,

Its completely political.
This way it will become an issue again when voting season is in full force, and he can blame the Rep for being cold and callous and against the working man. ALL LIES OF COURSE

[LuvRPgrl]

See, now I do like the idea of dropping or cutting the Payroll tax, but I would have made it contingent on companies increasing the size of their workforce by a certain percentage in order to qualify for the cut.

what I dont like even more is the govt using the tax codes to control people and businesses

[LuvRPgrl]

Or just scrap the entire income tax system and start over.

I already have, and legally too.

[red states rule]

what I dont like even more is the govt using the tax codes to control people and businesses

and deciding winners and losers in the private sector with taxpayer money

[LuvRPgrl]

There is no reason at all for businesses to think the demand for their product, service, is going to increase , if anything, the last few years of economic activity, or lack of, gives them reason to not hire.


Okay, I wasn't talking about private side. You're correct, private does nothing, but I was explaining my reason for the way I would do it. A company decides it's labor based on potential influx of profit. Now if they can stand to make money, they hire based upon that line of thinking,.
but that line of thinking is speculative on their part, and potentially bad for profits, and they know it. Its based on "probable" orders,
The real driving point is orders on their products or services, once the order is in, they are guaranteed to sell it, rather than producing and hoping it will sell, and if it doesnt, then they just stockpile more. And if companies stockpile more without sales, then the overabuncdance of inventory will lead to a cut in profits if anything.
THE VERY LAST THING COMPANIES WANT TO DO RIGHT NOW IS TO ADD TO THEIR INVENTORY PRODUCTS THAT ALREADY ARENT SELLING.


and many businesses are "hiring", meaning that they are looking for people, but they're waffling because they don't see enough gain on the investment in a new worker..
If so, then they shouldnt hire, the tax cut wont give them any new orders for product or services. Companies dont hire just because they can afford to, they hire because they have to meet the demand for their product.


Then there are the businesses that right now want/need more people but simply can't afford the extra payroll tax money that would be tacked on to what they actually said new worker..
If they seriously need more people, then it will pay for itself, if it doesnt, then they shouldnt hire, especially based on a bogus temp tax cut,



With a built in way to cut an expense based around employing more folks, this can tip the scale on those businesses, and allow them to hire on, but only if it rewards business for doing it.
Its simple enough to get around your proposal. All they have to do is cut the hours for all the employees.

The economy is consumer driven,
It all starts at the consumption, buying of goods and services, which creates demand, which creates jobs, which creates more consumers with more money, which creates......

[red states rule]

http://media.townhall.com/Townhall/Car/b/sbr122411dAPR20111222024537.jpg