Do Tax Cuts for the Wealthy Create Jobs?

Do tax cuts for the wealthy create jobs? Do you believe that the Bush tax cuts led to job creation? If so, please explain the process, or the method by which tax cuts to the wealthy create jobs.

 

The theory is that it frees up capital to be invested in the market, and these investments will create jobs.

I think a better approach is a direct approach--tax credits or tax breaks specifically for job-creating activities.

 

In some cases, the wealthy do pay less than the middle class as a percentage. The rate for capital gains tax is significantly lower than the income tax for higher brackets. Middle class individuals tend to receive the majority of income through salary, but higher income individuals are more likely to receive stock-based compensation, which if liquidated is subject to capital gains tax.

 

I'm talking about cutting the top marginal rate on the wealthy, as Bush did when he cut the top rate from 39.6% to 35%. Does that create jobs? If so, how?

 

Define "wealthy".

 

Those in the top income bracket. This would be single persons with a gross income above $381,250 or married people with gross income above $387,050 per year.

 

Do you mean stock market? If so, the only investment in the stock market that creates jobs is investments in initial public offerings, or additional stock being sold directly by a company. Otherwise investing in the stock market usually means buying existing shares from another shareholder.

Absolutely agree.

 

I'd say making over $1,000 a day is wealthy just about anywhere.

 

Ummm...no. 387k is a lot everywhere.

http://swz.salary.com/CostOfLivingWizard/Layoutscripts/Coll_Result.aspx

I did a cost of living conversion from NYC to Nashville, TN.

This calculator indicated that you would need $202k to maintain the same standard of living in Nashville.

202k is very well off in Nashville.

 

I try to understand how you all think, wheels spinning.

$1000/day personal income or family income?

If you think 10 times median income is "rich" then what do you call 1000 and 10,000 times median income?

Federal minimum wage is $7.25/hour or $15,080/work year. Median FAMILY income is around $50,000/year.

Median personal income is around $39,000. http://en.wikipedia.org/wiki/Median_household_income

http://en.wikipedia.org/wiki/Personal_income_in_the_United_States

Taking an average, median income is around 3 times federal minimum wage.

What do you all think is a reasonable divider between working class and middle class? Between middle class and rich class? Between rich and super rich?

 

It's not a matter of income for these distinctions. The middle class manages the working class. The rich class pays the middle class to work for them. The super rich do whatever they want.

 

Just wondered. Every time one asks a distribution of income advocate, one gets a different answer.

Just for the purposes of this discussion , I'll use Obama's figure of $250,000.

Since 75% of small business owners file individual tax returns, higher rates might force them to fire workers. OTOH Only 3% of small business owners make over $250,000, but that 3% hires 25% of the work force.

So, even if you don't agree that a tax decrease will increase employment, it's hard to make a case that a tax increase won' increase unemployment.

Even if it doesn't "create" jobs, it "saves" them, and puts them in Obama's favorite category of proof that the stimulus was worth the money..."jobs saved".

I know what I would do if I owned a business and got a 4% tax increase along with health care mandate and all the other burdens democrats want to place on small business owners...I'd fire somebody. Several somebodies if I could.

 

Solution: offset the tax increase by tax credits for small businesses. You create jobs; you reduce your tax bill.

 

Trickle down has been a very slow drip.

 

Status quo. With all the other Obama mandates for small business, the net effect is job losses.

If you really want to create jobs, do the credits and leave the tax rate alone. Then repeal Obamacare and get rid of the EPA and their new regs.

 

Yeah, lately.

But trickle up has never worked at all.