Romney with Income Tax and Capital Gains Tax

There was a time in which Mitt Romney ran for the Republican party nominee for President of the United States of America. During some of this time during the campaign there was one narrative taken against Mitt Romney about him showing his tax returns. In showing these tax returns they would see where he got his money, since Romney is said to be a wealthy person, and also to see how much of his money was taken by the federal government or state governments and at what rate he was taxed by these agencies.

It was found that Mitt Romney had no income for an income tax to apply to, but he did have a capital gains for a capital gains tax to apply. These are both taxes, but they are not one and the same type of taxes. Like Baltimore and Annapolis are in the state of Maryland & Baltimore and Annapolis are different from one another, so too are Income and Capital Gains both Taxes, Income and Capital Gains are different from one another. Income Taxes and Capital Gains Taxes are categorically different from one another. They specifically apply to things that meet certain criterion, and these criterion differentiate on where they apply and where they do not apply. It would be similar to how you have a fork and a spoon, and they come in a set of silverware. They are both equal in being silverware, but the fork is not the spoon and the spoon is not the fork, but silverware fork and silverware spoon are silverware.

So what is the problem? Here is one article talking about the difference from an economist. Here is a reply, in some sense, to the first article.

The first point, and most important point, which the Supreme Court has said itself, which is that the power to tax is the power to destroy. The first article points out the difference between an income tax and a capital gains tax. So these are different powers of destruction being applied to two different sub groups.

“What is a capital gain, and how can we distinguish it from ordinary income? The answer seems simple. If you have a job, the money you are paid for your work is ordinary income. If you buy an asset at one time and sell it later for a higher price, the profit you made from holding it is a capital gain.”

These are two different types of actions that individuals have with one another. One person works for another and gets paid for this work and gets taxed for their work. Another person sells a property for more than it was previously worth and makes a profit that is taxed. So we notice two different types of activity and how the government is taxing these activities. What is noticed is that those people who partake in the activity of capital gains get taxed at a percentage of 15%, and those who partake in the activity of income activity are getting taxed at a percentage of 35%.

Now some of the issues that people had were that Mitt Romney did not pay the income tax rate, but he payed the capital gains tax rate. One of these rates was lower than the other. This does not exactly appear to be what people were upset itself, since it appeared that people were upset about the first but that Mitt Romney is also a wealthy person who is considered to be part of the 1%. It was both of these conditions that made it so that people looked down upon Romney for not being forced to give up 35% of his property by being forced to give up 15% of his property, based on his activities with other people. Mitt Romney followed the law by paying the taxes his taxes based on his activities, which were not in the category of income but in the category of capital gains, even though either which way he would have been taxed. He just didn’t have to be taxed in one way over another, in which one happened to be less than another.

Now let me ask you, does it appear to be wrong that certain activities should be taxed less than other activities? For example, say that we have someone who partakes in activities which harm 49 people out of 50 people, and we have someone who partakes in activities which harm 1 person out of 50 people. Which activity, if both of these activities are legal, would you think one should be taxed more than another? Remember, the ability to tax some activity is the ability to destroy that activity.

The question becomes which activity do we want to be taxed, and how much do we want to tax that activity? Either income has a higher tax rate than capital gains, or income has a lower tax rate than capital gains, or income tax rate is equal to capital gains. If income has higher rate than capital gains, then government is giving less incentive for income activities. If income has a lower tax rate than capital rates, then government is giving more incentive for income activities. If income tax rate is equal to capital gains, then government is giving equal incentive for both activities Thus, either government is giving less incentive for income activities, or government is given more incentive for income activities, or government is giving equal incentive for both activities.

The question becomes, which tax bracket do you want to destroy? Do you want to destroy the activity of capital gains or income? When people ask for a tax increase, they want to destroy people or prevent the activities of people. So those people who are considered to be wealthy are people we want to destroy by making them give up more of their property. But this also holds with those people who are not wealthy.

Now if we want to treat people equally, give them all the same shot, have the same rules apply, then make them equal in their activities. A person gets a shot at either income activity or capital gains activity. Not everyone is built for income activity or capital gains activity. You might not be good at a 9-5 job for 5 days a week in a year. You might not like that job, and not just good at that type of activity. Maybe you are better at having some property and being able to sell it for more than you obtained it for. People have different talents, and so some people are more aligned with either one or the other, and some people are of both sides. We would be telling those who are better at capital gains activity that we don’t like that and we think they should be punished for their ability (if not outright luck). Same would hold with those who do income activities.

2012 Presidential Election Results

Here is some information on the Presidential Election results of the 2012 election.

http://www.google.com/elections/ed/us/results

Here are some numbers that they give:

Popular Vote- 120,887,981

Obama- 50.5%/ 61,128,734
Romney-  48.0%/ 58,138,521
Johnson- 0.9%/ 1,139,562
Stein- 0.3%/396,684
Barr- <0.1%/ 49,959
Anderson- <0.1%/ 34,521

Electoral Vote- 509*

Obama 303
Romeny 206

(* The Electoral vote is 538, but the result of Florida has not been added in, so the 29 votes missing belong to Florida.)

Obama received 50% of the popular vote and Romney obtained 48% of the popular vote. That is a 2% difference in popular vote between Obama and Romney. Obama received around 59% of the Electoral vote and Romney received 41%. There is a 18% difference in the electoral vote between Obama and Romney.  Obama did 9% better with the electoral vote than the popular vote, and Romney did 7% worse with the electoral vote than the popular vote. IOW, Obama did better with the electoral college than he did with the popular vote; Romney did better with the popular vote than he did with the electoral vote.

Think about this the next time you hear someone saying that there was a mandate for the Obama Administration and the Democratic Parties plans or ideas. The American public is split on this issue. It is not a nation united, like promised and hoped for and tried to change to back in 2008, but it is a divided country from what it especially once was. If you have someone tell you that there was an American mandate that supports Democratic policy, point out that the popular vote was only 2% difference between “American mandate” for Obama and “No American mandate” for Obama. Obama won handedly in the electoral college, but he definitely did not in the popular vote.

Where Half of Obama’s National Debt Came From

There was a  Presidential debate between Mitt Romeny and Barack Obama on October 3rd, 2012. This was the first Presidential debate between Mitt Romney and Barack Obama. Now what is interesting about this was not so much the debate itself, but some commentary on the debate. For example, PBS discussed and commented on some of the statements that the candidates made, and did some “fact checking”. Mark Shields happened to bring up one of the most interesting points of them all. The point they made was that half of the national debt incurred under Obama’s 1st term was based on pulling out of Iraq.

Now I want you to realize this, around 3 trillion dollars of around 6 trillions of national debt incurred under Obama’s first term. Under 2 terms of George W. Bush, around 4 trillion dollars were incurred on to the national debt. Now Bush lead the US into an undeclared war with both Afghanistan and Iraq, and Congress approved to continue to fund this undeclared war. And when this undeclared war was said to be officially over, US troops occupied those nations. These nations continued to be occupied up to the 2008 Presidential Election. Barack Obama said that he would bring the occupation troops in Iraq back home within 16 months of his election as President. By 2011 the last troops were pulled out, but don’t mind the huge embassy. But he did flip-flop on promises of when pull out would be done of occupation troops in Iraq. (They are literally military troops occupying land in a foreign nation.)

One of the big points made against Bush was that he used the national “credit card” to pay for the “Wars” in Iraq and Afghanistan. He used the credit cards to get us into these occupations of foreign nations, and the debt rose by 4 trillion in 8 years of Bush doing this, or 7 years at least. But Obama would use the national credit cards to pull out of Iraq alone, which costs nearly half of the debt incurred by using the credit card under Obama’s watch. Just think about that when you realize that the troops are back from occupying foreign lands, instead of being stationed at home with their families and community and defending the continental boarders and US owned land.

Point blank: Promised to get out by a certain date and does not pull out by that certain date, but also being ambiguous on when it will happen until it happens after it contradicts some earlier states. Raised the national debt more than his predecessor, while at the same time obtaining half of it pulling out of Iraq.

But let us be fare to Mr. Bush and Mr. Obama. They can only order where the troops go and when they come back. But Congress controls the revenue and distribution of the revenue. So the people using the national credit card where Congress. Just ignore that last important part and enjoy the hypocrisy of 21st politics.