A recent editorial declared a victory for Obamacare as evidenced by a Robert Wood Johnson Foundation survey showing a substantial reduction in the number of uninsured New Jersey residents over the past year.
The result, while positive, is not all that surprising given that under the law individuals must purchase coverage or face a financial penalty. In addition, the government doled out taxpayer-funded subsidies and expanded eligibility under Medicaid. I suppose there aren’t too many problems that can’t be solved by throwing money at them — except perhaps deficits.
The result, while positive, is not all that surprising given that under the law individuals must purchase coverage or face a financial penalty. In addition, the government doled out taxpayer-funded subsidies and expanded eligibility under Medicaid. I suppose there aren’t too many problems that can’t be solved by throwing money at them — except perhaps deficits.
The editorial does not report on other effects of Obamacare: cancellation of policies for individuals who had to then purchase new policies at vastly higher premiums, elimination of choice among coverage (Uncle Sam knows what you need), and an overall reduction in the availability and quality of health care.
Recent downward corrections to the enrollment figures due to non-payment of premiums portend even higher premium costs next year unless the administration bails out insurers for their losses with even more taxpayer money. No one disputed the goal of reducing the ranks of the uninsured. The quarrel was always with the approach.
Until this ill-conceived law is repealed, we have to live with its consequences, both intended and unintended. To paraphrase the Greek King Pyrrhus, any more victories like this, and we will be ruined.
The Gas Tax Hike Cometh Sep. 23 By Matt Rooney | The Save Jersey Blog
As recently as March, Save Jerseyans, Governor Chris Christie said gas tax hikes were off the table.
He strongly opposed a proposal from Sen. Ray Lesniak (D-20, Union) earlier in the year which would’ve raised the gas tax by 15 cents over 3 years.
But I warned you earlier this week how the pending confirmation of Jersey Department of Transportation Commissioner-designate Jamie Fox could signal a change in thinking, or at least tactics.I take no pleasure in being right. Trust me. I’ll be paying right along side you at the next pump. So enjoy our run of cheap gas (which is attracting drivers to NJ… when does that every happen?) while it lasts…
According to multiple reports, a bipartisan agreement to raise the gas tax between 15 cents and 20 cents or, alternatively, hike the petroleum products gross receipts tax (paid by refineries and distributors) is moving forward behind closed doors. Or some combination of the two. Whatever. Fox, who presumably discussed these issues with Gov. Christie’s team at length, is echoing his support of a gas tax back during the McGreevey Administration by declaring “[n]othing is off the table.”
It damn well should be!
Believe it or not, New Jerseyans enjoy the third lowest gas tax in the United States. A 15 cent tax would’ve added, on average, $230 to the cost of driving every New Jersey car each year. This is on top of Parkway and Turnpike tolls doubling since 2008. At what point does flying or driving (or swimming) around New Jersey make more sense than paying out the rear end to drive through it?
Census data show poverty up, incomes down as NJ economic recovery lags
SEPTEMBER 18, 2014 LAST UPDATED: THURSDAY, SEPTEMBER 18, 2014, 12:48 AM BY KATHLEEN LYNN AND DAVE SHEINGOLD STAFF WRITERS
Despite a growing national economy, New Jersey’s weak job market led to lower incomes and a higher poverty rate in the state last year, the Census Bureau said Wednesday. Bergen and Passaic counties were hit especially hard.
Wide disparities
Households in North Jersey generally lost ground financially in 2013, while those in and around New York City fared better.
Median household incomes:
New Jersey
Bergen County: down 2.7 percent
Passaic County: down 1.7 percent
Hudson County: down 3.9 percent
Morris County: up 3.6 percent
New York
Manhattan: up 6 percent
Brooklyn: up 3.6 percent
Staten Island: down 3.3 percent
Nassau: up 1.7 percent
Westchester County: up 7.4 percent
The recession ended in 2009, but a wide range of census measures showed New Jersey was still feeling its effects in 2013. Food stamp use rose; the homeownership rate dropped. Families were more likely to delay having children or decide against paying private-school tuition.
Although one year’s census figures do not indicate a trend, New Jersey’s numbers have generally been tracking in the same direction since the recession. Offering some hope for a better 2014 in New Jersey, experts say a recent drop in unemployment, as well as a higher minimum wage, could mean that incomes have started to rise, and poverty rates to fall, this year.
But in 2013, median household incomes in New Jersey, adjusted for inflation, dropped by 0.7 percent, to an estimated $70,165, mirroring similar declines in surrounding states. New Jersey incomes, after inflation, have dropped 9 percent since 2000, and 6.8 percent from 2007, right before the recession hit.
Nationally, household incomes were essentially flat last year, at about $52,000.
Fed: Under Obama, only the richest 10 percent saw incomes rise
By Jennifer Pompi – The Washington Times – Thursday, September 4, 2014
Under President Obama, the richest 10 percent were the only income group of Americans to see their median incomes rise, according to a survey released this week by the Federal Reserve.
The Fed data covered the years 2010-2013, during which period Mr. Obama constantly campaigned against income inequality and won re-election by painting his Republican rival as a tool of Wall Street plutocrats.
“Data from the 2013 [Survey of Consumer Finances] confirm that the shares of income and wealth held by affluent families are at modern historically high levels,” the report said in noting that the median income fell for every 10-percent grouping except the most affluent 10 percent.
Why A Six-Figure Salary No Longer Means You’re Rich in Investing by Holly Johnson
I was born in 1980, and I still remember the days when “bringing in six figures” was a sign of extreme wealth and success. It was more than enough to buy the perfect house with a white picket fence, after all, and achieving that sort of income implied a certain level of status that nearly everyone aspired to. You could even say that a six-figure salary was seen as the real “American dream,” simply because earning that much money meant that you had “made it,” at least in financial terms. As a child, I distinctly remember dreaming of a six-figure income myself, and fantasizing about all of the amazing things I could do with so much money.
Times have changed since then, but the public’s perception of a six-figure salary hasn’t necessarily changed with it. With the median household income stuck at around $53,093 in 2014, an annual salary of nearly twice that still seems like more than enough money to succeed and thrive in any economy, no matter the circumstances. However, a convergence of factors have fundamentally changed what it means to rake in a “six-figure salary” in America, and many families who look rich on paper are merely struggling to get ahead along with everyone else.
Why Six Figures Isn’t What it Used to Be
Earning a six-figure salary is still a sign of status and success, but it no longer guarantees a lifetime of wealth like it once did, especially in certain parts of the country. A recent analysis by USA Today goes even further to say that the average price of living the American dream has now risen to $130,000 per year due the rising costs of nearly everything. The authors of the study claim that the American dream is about “finding and pursuing a rewarding career, leading a healthy and personally fulfilling life, and being able to retire in comfort,” adding that only 1 in 8 households in the U.S. currently earn enough to achieve those goals. But, what exactly has changed?
Why It Makes Sense for Burger King to Become a Canadian Company
Stephen Moore / @StephenMoore / August 25, 2014
How many iconic American companies have to leave or threaten to leave these shores for foreign lands before Washington acts to fix our anti-growth tax system and keep firms, profits, and jobs here in the U.S.?
Burger King became the latest Fortune 100 company to announce it is looking to leave. The company is considering a deal to merge with Canadian restaurant chain Tim Hortons and move its headquarters north across the border. The multi-billion dollar deal would make the $11.4 billion hamburger company now based in Miami a Canadian firm valued at more than $21 billion. The technical term for this transaction is an “inversion.”
Why is it happening? The combined federal and state corporate income tax rate in Florida is 38.6 percent, near the highest in the world and more than a third higher than the combined national and provincial rate of 28.0 percent in Ontario, Canada. This is costing American workers jobs and the U.S. capital investment.
No surprise that tax shares for both Tim Hortons and Burger King soared nearly 20 percent at the prospect of less of the company’s profits being taken in taxes—a boon to investors of more than $3 billion in one day. So far this year companies like Pfizer, Walgreens, AbbVie, and others have investigated similar moves to lower their tax bills.
Expect a blizzard more of these tax moves if the U.S. corporate tax isn’t reduced quickly to at most the average in the industrialized world of 25 percent. Better yet would be to abolish the corporate tax altogether and tax the shareholders on these profits. This would cause a flood of companies to come to the U.S. rather than leave.
The hamburger is a quintessential American food. What could be more unpatriotic than giving firms like Burger King a financial incentive to leave the U.S. because of the high tax rate here? Thanks, Congress!
parasites and political clowns in Washington, Trenton
Don’t blame the business people
AUGUST 17, 2014 LAST UPDATED: MONDAY, AUGUST 18, 2014, 12:16 AM SUBURBAN TRENDS Print
Don’t blame the business people
Dear Editor:
A recent letter to the Suburban Trends expressed outrage that some business groups take their holdings offshore to avoid U.S. taxes.
The writer shows a complete ignorance of economics and a hostility to private business.
Business and industry flee America because of the anti-free market environment they have to deal with thanks to the politicians and unelected bureaucrats. No business leader in their right mind would want to set up shop where they will be penalized for being productive.
How many Americans know that the income tax, which we’ve been saddled with since 1913, has its origins in Karl Marx’s “Communist Manifesto” of 1848? “Comrade Karl” thought the income tax so important that it’s the number-two item (next to the abolition of private property) in his plan for a socialized all powerful centralized state!
Add in all the other unconstitutional agencies and bureaus like the EPA, FDA, BATF, and many, many more, and it isn’t hard to see why business leaves the United States.
It’s not just the bloated federal government that is to blame. We have tons of state, county, and local laws, taxes, and regulations across the land that stifle business. These petty local tyrants make life miserable for anyone trying to succeed in business development.
My father, retired construction official Gene Richards of West Milford, is a case in point, In 1998 he came out of retirement to serve on West Milford’s Zoning Board of Adjustment. It didn’t last long as he was thrown off for stating that zoning was a form of property rights violation by government. I don’t want to sound paranoid but I honestly think my pro-freedom libertarian activism over the years may have had something to do with it too. Nobody likes independent thinkers who see beyond the phony “Liberal” versus “Conservative” debates on various issues.
If you wish to bemoan America’s slow economic growth and decline, don’t blame business people. Rather focus on the parasites and political clowns in Washington, Trenton, and your local community who always want more “controls” on virtually everything. They are truly a menace! Vote them out ASAP!
‘Unless there are changes made to the system itself, we cannot tax our citizens enough, even if we wanted to,’ governor says
PARSIPPANY -Gov. Chris Christie this afternoon tried a flanking move in his public pensions and benefits chess game with the Democratic Legislature, leaning on the optics of what he promised will be an apolitical squad of fiscal experts. (Pizarro/PolitickerNJ)
This idea that we live in a world where government cares about us is just the biggest propaganda ever. Everyone one will only pursue their own self-interest.The OECD has interesting come out and warned that if governments are unable to stop the transfer of wealth to a small financial elite, the displeasure of the dispossessed middle class could easily turn and go against the prevailing governmental systems. The OECD has claimed to have discovered the existence of a veritable “lumpenproletariat” in the supposedly rich Germany. Even though the systems attempt to provide citizens with bread and circuses in the traditional Roman style to keep them quiet, such tactics they warn may have now become obsolete after the ultimate circus is over – the World Cup.
The problem with all of these studies is the look at class warfare and not at the consumption of government. They do not follow the breadcrumbs. What if you take everything from the elites? Who will start businesses to create jobs? Who will be left to take as government pensions keep ticking away. In Germany, it has now surpassed 50% of the average persons labor goes to taxes. There are a host of books coming out all about just taxing the rich more ignoring reducing the cost of government. The German bestseller “The plunder of the world” presents just another socialist agenda arguing that the rich get richer even in times of crisis, while the consequences of a crisis are always carried by the lower-income groups and the middle class. It fails to explain that the rich get richer from investment, not wage income. This is an argument to effective tax investment substantially to even out the disparity? But who then creates the jobs that produce anything? Is it that those who invest unfairly make money when the others pay too much in taxes and do not invest? Anyone who thinks that these books are real must be insane. If you think for one second raising the taxes on the rich will mean your taxes will decline – good luck. In Germany, Tax Freedom Day has passed the 50% and even in Canada it is now June 9, 2014. In the United States it is April 21st for 2014.
Here’s a Crazy Idea: What About Reforming Transportation Spending Instead of Hiking Taxes? Emily Goff / June 26, 2014
Americans know the drill. When Congress faces a gap between its spending wants and available money, it is quick to ask for more money, instead of fixing the spending side of the budget ledger.
This time it’s Senate Finance Committee chairman Ron Wyden, D-Ore., who has proposed a rag tag group of revenue provisions, including hiking taxes on heavy vehicle use, aimed at filling a hole in Washington’s Highway Trust Fund (HTF). Federal gas and diesel taxes deposited in to the HTF go to pay for road, bridge, transit, and other surface transportation projects in the states.
Yup, you got it: Wyden’s focusing on new ways to collect money – without even mentioning spending reforms.
Conservatives on the committee rightly grumbled at its total lack of spending cuts, and now the committee is going back to the drawing board to try and find more palatable reforms all around.
Wyden isn’t alone: Others in Congress have called for gas tax hikes or bailing out the fund with postal reform revenue. But few have proposed reforming spending out of the HTF. In other words, lawmakers by and large aren’t interested in, changing which programs are eligible for the federal gas and diesel taxes deposited into the HTF.
The HTF was set up to pay for the interstate highway system. That was largely completed decades ago, but past Congresses added a laundry list of newly eligible activities, such as subways, buses, metropolitan planning, bike and walking trails, sidewalks, landscaping, ferry boats and interpretive signage.. These are diversions, pure and simple. Their users, such as transit commuters, bicyclists, and pedestrians, pay nothing into the HTF but benefit from it. And money spent on landscaping and subways is spent at the expense of road and bridge improvement projects that would benefit the motorists and truckers who pay the fuel taxes.
Here’s an idea, Sen.Wyden: End these HTF diversions toparochial activities, which don’t reduce traffic congestion or enhance mobility for motorists. Doing this would free up billions of dollars annually for road and bridge projects which, according to theclaims of some special interests in Washington, are “crumbling.” These claims are exaggerated, but the point remains that the money would be available to make necessary improvements to aging parts of the system and expansions where demand exists.
While you’re at it, Mr. Chairman, how about proposing crucial regulatory reforms that would help the states stretch their transportation dollars further and reduce unnecessary project delays and cost overruns? Start by repealing the Davis-Bacon Act and eliminating duplication in onerous environmental review processes. The states, which are tired of the endless delays and unnecessarily high costs of building a road or a bridge, will thank you.
Wyden’s current proposal is reckless: It relies on 10 years of revenue to pay for six months of transportation spending. Additionally, this plan continues bailing out the HTF, violating the important ‘user pays, user benefits’ principle. That is, motorists pay the fuel taxes and should benefit, not be shortchanged.
Even aside from any merits of this particular proposal, Congress should avoid renewing highway legislation in the lame duck session of Congress. Lawmakers have a tendency to pass shoddy deals for taxpayers during such sessions.
If Congress had to live within the trust fund’s means, it would be forced to set priorities for what is truly a federal responsibility, instead of continuing to take the easy road of making everything a spending priority..
Are You Dumb Enough to Trade $10 Billion for $560 Million? Jun. 25 s By Irwin M. Fletcher | The Save Jersey Blog
Author’s Note: I’m not THAT dumb, Save Jerseyans.
Why do we ALWAYS have the same argument over a millionaires tax?
Scratch that, Save Jerseyans. Why do Democrats and newspaper editors, aka Harry & Lloyd, our friends from Dumb and Dumber, ALWAYS ignore the facts of this argument? I’m getting sick and tired of the facts staring them right in the face and then, instead of responding to logic and reason, they lie to our faces. When they say that people do not leave, that people do not flee a state when they institute a millionaires tax, grab a fire extinguisher, aim it at their pants and get ready to pull the pin.
Wealth flees, Save Jerseyans. Wealth flees. And here is what the FACTS tell us what happens when a state, any state, raises its millionaires tax.
In the first fiscal year they are enacted, taxes generally raise anywhere from 90 to 95% of the publicly estimated revenue to be raised. Sometimes it is more, sometimes it is less. This occurs for 3 main reasons: 1) They are usually retroactive for the current fiscal year, and since DeLoreans don’t come standard with flux capacitors, taxpayers can’t do much about avoiding taxes in June on income already earned 6 months ago in January; 2) Moving/fleeing doesn’t happen overnight. While millionaires have the resources to leave the state due to taxes, it takes some time. So while they cut through the red tape, their income stays and is taxed at the new higher rate; 3) The projections employed are usually the rosy best case scenario ones to make the TV sound bite better. $600 million sounds better than $500 million when you’re trying to close a budget gap. But the best case scenario is hardly ever the real case scenario.
It is also a fact that after the fiscal year of implementation, tax revenues come nowhere near projections. Nowhere near. The first years collections are a one-time windfall. Revenues fall drastically in year two. The funds that the millionaires tax was supposed to raise aren’t materializing. Not there. Year three, the gap between projected tax revenues and collected revenues is even bigger! Heck, sometimes it’s BELOW then where they started three years ago! States are collecting less income taxes than before their millionaires tax! By year four and year five, the tax revenue situation is so bad that Harry & Lloyd start up the same argument again.
– See more at: https://savejersey.com/2014/06/millionaire-tax-state-budget-analysis/#sthash.1Mv0P16u.dpuf
Average Worker Pays over $16,000 in Income and Payroll Taxes
Washington, DC (June 19, 2014)—U.S. wage earners face a 31.3 percent tax burden on pre-tax income according to the latest analysis from the nonpartisan Tax Foundation. Although this burden is high, the average across the 34 OECD countries is slightly higher, at 35.8 percent.
Using the latest data from the OECD, the report hones in on U.S. tax policy and explains the breakdown of the average U.S. worker’s tax burden, how it compares to other developed countries, and why workers, instead of employers, bear the weight of the tax burden.
An average wage earner’s tax burden is comprised of income and payroll taxes. Although a little more than half of a worker’s payroll tax burden is paid by his, he ultimately pays this tax through lower take-home pay.
While the revenues from these taxes pay for government programs, it is important to know what the cost of these programs are from the average worker’s perspective.
Key findings include:
The total tax burden faced by wage earners in the United States is 31.3 percent of their pre-tax earnings, paying $16,658 in taxes in 2013, with $8,196 in individual income taxes and $8,462 in payroll taxes. In the absence of income and payroll taxes and the benefits they provide, the average worker would take home nearly $5,000 in additional annual income for a total of $53,223. The total tax burden faced by average U.S. workers is the 26th highest in the OECD and below the 34-country average of 35.8 percent. The average U.S. worker faces an above average income tax burden (15.4 percent vs. the OECD average of 13.3 percent) and a below average payroll tax burden (15.9 percent vs. the OECD average of 22.6 percent). Many OECD countries have high payroll taxes, such as France, which places a payroll tax burden of 38.5 percent on average workers. In some countries, over 50 percent of a workers total tax burden is paid by their employer. Many countries in the OECD, including the United States, have special provisions for families with children that lower their overall tax burdens.
“Although the United States and most OECD countries are known for having progressive tax systems that tax high-income earners more than low- or moderate-income earners, a large portion of the tax burden still falls on the average worker,” said Tax Foundation Economist Kyle Pomerleau.
“Even here in the United States, which has lower tax burdens than most other OECD countries, average workers end up paying nearly one-third of their income in taxes. It is true that governments in the OECD, especially European countries, provide more government programs. However, their workers end up paying a much higher price for them.”
Trenton’s Broken Record Jun. 19 By Joe Sinagra | The Save Jersey Blog
“This plan is not only a matter of fairness and responsibility with pension payments, it is really about the full range of government services and opportunities, including such things as property tax relief, college affordability, public schools, law enforcement, transportation and many more priority needs,” NJ Senate President Steve Sweeney said on Wednesday as he rolled out his counter-proposal to Governor Chris Christie’s budget. “We have to maintain the state’s commitment to all New Jersey residents by meeting all of our commitments. This is a fair and responsible plan that will help meet those needs as it restores balance to the budget in a fiscally responsible way.”
So in all the years and administrations prior to Christie being governor, the 154 tax increases, raising the state sales tax from 6% to 7%, a 4% corporate tax surcharge, a 25% increase in liquor taxes, increased taxes for the citizens of New Jersey by over $10 billion dollars, an increase in the Realty Transfer Tax of $62 million on the state level, another $22 million on the county level, along with another $8 million tax on the lottery. . . Senator Sweeney now suddenly believes we need a fair and responsible plan?
What happened to all of the revenue that was already collected?
Even the promised tax rebate disappeared. On average, property taxes went up 55 percent statewide from the prior seven years before Corzine and another 20 percent when Corzine took office, and Corzine left us a $2.2 billion shortfall that existed when Christie took office on Jan. 19, 2010.
And Senator Sweeney decides now is the time to meet the commitments of the residents? Why is it that more is never enough in this state?
Federal Tax Revenues Set Record Through May; Feds Still Running $436B Deficit June 12, 2014 – 11:20 AM\ By Terence P. Jeffrey\
( CNSNews.com) – Federal tax revenues continue to run at a record pace (in inflation-adjusted dollars) in fiscal 2014, as the federal government’s total receipts for the fiscal year closed May at an unprecedented $1,934,919,000,000, according to the Monthly Treasury Statement.
Despite record revenue, the federal government still ran a deficit of $436.382 billion in the first eight months of the fiscal year, which began on Oct. 1, 2013 and will end on Sept. 30, 2014.
In the month of May alone, the federal government ran a deficit of $129.971 billion–bringing in $199.889 billion in revenue while spending $329.860 billion.
The White House Office of Management and Budget has estimated that in the full fiscal 2014, the federal government will collect $3.001721 trillion in taxes, spend $3.650526 trillion, running a deficit of $648.805 billion..
Obamacare Taxes: Next Filing Season Could Be “one of the most chaotic in years.” Posted by John Kartch on Tuesday, June 10th, 2014, 10:25 AM
Problems with a key component of Obamacare will lead to unpleasant surprises for Americans during the 2015 tax filing season, according to testimony from a top tax expert before the House Ways and Means subcommittees on Health and Oversight today.
“I am here today to tell you that the upcoming tax filing season has the potential to be one of the most chaotic in years,” said Ryan Ellis, an IRS Enrolled Agent and Tax Policy Director at Americans for Tax Reform.
According to the testimony:
“One of the key elements of the Affordable Care Act, popularly known as “Obamacare,” is the creation of advanceable tax credits for the purchase of exchange health insurance plans.
Taxpayers applying for credit assistance must be evaluated by government entities ranging from the SSA to CMS to the IRS. The goal is to have an educated estimate, based on the most immediately-available government documents (e.g. prior year tax returns, etc.), of the taxpayer’s probable income for the year–which in turn determines the size of the tax credit.
In an effort to get this tax benefit out quickly, the estimated credit is advanced to the insurance company by the IRS, which applies it to customer premiums.
This is an important point—the money has left the IRS’ hands up to over a year before the taxpayer actually calculates his final credit amount. The insurance companies have collected it, and they are not required to pay it back.
Press reports this month indicated that the government was having a hard time doing all this, with 1.2 million of the 6 million federal exchange applicants having to be asked for additional income verification information from CMS. That is not surprising. Applicants are asked to complete a detailed, confusing twelve-page application which asks for income, family size, etc. It is rather like trying to fill out a 1040 on the fly. Added to this is the lack of employer reporting requirements and the failure to complete the back-end of the web site.
Inconsistencies–some of which are the result of failures of the healthcare.gov system, some of which are poor records from the government, and some of which are mistakes from the individual–are not surprising. But they are a problem. It is the middle of June, and many people have now been receiving inaccurate subsidies for six months. To the public’s knowledge, not a single advanced tax credit has been adjusted this year.
So what happens if the flawed, confusing process results in a tax credit larger than what the law calls for?
A hypothetical example might help illustrate: a health exchange customer selects an Obamacare exchange plan. The government estimates that this taxpayer will earn $30,000 this year, which makes her eligible for a $2000 tax credit. This $2000 is paid to the taxpayer’s insurance company to help with premiums.
The next spring, our customer/taxpayer is filling out her tax return. Unfortunately, the government estimated the taxpayer earned too little and paid too large a credit. She actually earned $40,000, and so only had a $1500 credit coming to her.
Depending on the taxpayer’s income level and availability of verified affordable workplace insurance, she will have to pay back much or all of the $500 overage to the IRS. This means skinnier refunds and maybe even liabilities, and it won’t be the taxpayer’s fault—it will be the government’s fault.
It is also inevitable that many people are receiving tax credits for which they are completely ineligible. The firewall of the offer of employer sponsored insurance is a new concept — tax preparers will have difficulty figuring out how it works in operation. There is virtually no way to catch it on the front end — but come tax filing season, many people will end up owing thousands of dollars, and it will be a complete surprise.”
