Anyone have thoughts on this?

[kcjenkins]

Hillary, in her speech this week, said she wants to "expand and simplify the earned income tax credit". Anyone have any thoughts about how this could be done, and how it would work?

Personally, that scares me more than most of her tax-related quotes, most of which I doubt she can get passed. This one scares me because it might actually pass. And I can only see that 'simplifying' as increasing the amount of fraud.

[redux]

Hillary, in her speech this week, said she wants to "expand and simplify the earned income tax credit". Anyone have any thoughts about how this could be done, and how it would work?

Personally, that scares me more than most of her tax-related quotes, most of which I doubt she can get passed. This one scares me because it might actually pass. And I can only see that 'simplifying' as increasing the amount of fraud.

Well, without knowing more about exactly what she is proposing it would be difficult, if not impossible, to comment here. I rarely read or pay any attention to her since she is so repulsive and plastic.

She seems to be a class A politician though, in that she'll say, do or pander whoever and whatever she must in order to further her career. Of course, I realize that she's not alone in that respect, many people running for office do the same. Bill was a master at it, which is why she is being led by him to do it now...it worked for him, so what the hey.

[kcjenkins]

Hillary outlined her economic fairness doctrine: “There is no greater force for economic growth than free markets, but markets work best with rules that promote our values, protect our workers and give all people a chance to succeed. Fairness doesn’t just happen. It requires the right government policies.”

So, according to Hillary, free markets work best when they’re constrained by the "right" government policies. In other words, free markets work best when they’re not free. I find that really scary, myself. Sadly, tho, I think a lot of people will read or hear those lines of hers and think she is right. Because they will not really think about what she is implying. They will just react to the term 'fairness', something everyone wants. Not realizing that letting the government decide what is 'fair' is not really something they would want to do, based on past experience with government 'services'.

[JohnH]

I think Karl Marx, Chairman Mao, Lenin, Joe Stalin, and others of their ilk did a pretty good job of showing us what "fairness" looks like when government is expected/allowed to define it. After all, enforced egalitarianism seems so logical to the simple-minded. Hillary has certainly borrowed heavily from their ideas, and it appears she just can't wait to get it right where they failed. The people who are sucked in by her simplistic pronouncements just have no sense of history, not to mention a deficit of basic character judgement.

[redux]

In other words, free markets work best when they’re not free.... Sadly, tho, I think a lot of people will read or hear those lines of hers and think she is right. Because they will not really think about what she is implying. They will just react to the term 'fairness', something everyone wants. Not realizing that letting the government decide what is 'fair' is not really something they would want to do, based on past experience with government 'services'.

Unfortunately you're right KC, and that's what so many of the speeches of many candidates are about,...trickery. It used to be called lying.

I'm not smart enough to know the answer, but doesn't it just frost you when you're discussing some upcoming election with another and they get around to stating for whom they intend to vote, but when you ask why...they can't tell you, because they have no constructive reason. They have a friend who heard that their great uncle's mechanic has a customer who heard that their brother was going to vote for that person so if unk is going to vote that way, so am I.

[Peggy Cobb]

In line with other tax related statements Hillary has made, I agree this one is scary. When I consider her statements that the wealthy are not paying enough and wanting to help the "working poor" I can easily see her increasing the AMT or creating some other way of increasing taxes. I agree with we would see an increase in Earned Income fraud.

I also agree that the average American does not understand what she is saying. So many people don't realize how much they are paying in Social Security & Medicare taxes, gasoline taxes, state income taxes, state fees, and all the other ways we pay taxes without fiscally writing a check. You know from talking to clients that most people will tell you their net wages and don't have a clue what their gross wages or various withholdings are.

To be honest, Hillary scares me because she is so scripted it is hard to know what she will do.

[kcjenkins]

You are right, Peggy. I pointed out to someone yesterday, who was going off on the oil companies, that their profit was less than 10¢ a gal, but the fed and state taxes are over 45¢, and that does not even count the income taxes they pay on those profits. And that if they don't make profits, they will not have money to spend on finding new sources of oil, either.

But her response was just, "Well, they are making too much money." Yet they contribute something critical to all of us, while movie stars and sports stars make a lot more, proportionately, and contribute much less, and hardly anyone has a problem with that. Her answer to that? "Well, but we don't have to buy tickets, and we do have to buy gas."

She does not even see that her logic is exactly backwards. The more we need the product, the more important it is that they be allowed a profit for their labors! If we don't pay the stars, and they quit performing, no one but them is really hurt. But if we put the oil companies out of business with taxes and regulations that make what they do too risky, for not enough return on investment, we are all hurt. It's sad that so many people are so poorly educated that they can not understand that.

[Peggy Cobb]

KC, You said it so much better than I could have. It is sad that our schools don't teach economics anymore. I often read your posts and find we are on the same wave length. I really worry about our nation, but that just means I need to speak out more and stay active. Good Luck

[kcjenkins]

It's worse than that, Peggy, many of them are teaching what they call Economics, but what they are teaching is the opposite of the truth. They are teaching that Capitalism is bad, and that only Government can protect 'the workers' from those nasty old 'Owners', aka 'Rich People'.

[JohnH]

"... the whole point of political rhetoric is to make it unnecessary for you to have to go into the specifics before taking sides. You don't need to know any economics to be in favor of 'a living wage' or 'affordable housing.' In fact, the less economics you know, the more you can believe in such things."

excerpt from a recent article by Thomas Sowell entitled "A War of Words".

There are numerous other gems of Sowell's usual wisdom & wit in the same article.

[kcjenkins]

I agree, Dr Sowell is one of my favorite columnists, because he makes so much sense. And this issue of the 'words' is an excellent example. For starters, challenge anyone who uses the word "fair" in a debate to use "mutually acceptable" instead. The word "fair" is one that is used to disarm an opponent through manipulation by guilt. No one wants to be considered UNFAIR. Yet there is no real definition of what 'fair' means. What I consider fair may not seem fair to you. Well, it probably will to you, John, but not to dear Grace & Peace Dave!

If instead of talking about 'fair', we talk about 'mutually agreeable', we now have a standard to measure against. But then BOTH sides, conservative as well as liberal, must be considered. And that is not acceptable to most liberals. They do not WANT 'mutually acceptable' solutions, they want THEIR solutions, which they have simply declared to be 'fair' ones.

[MontanaEA]

If instead of talking about 'fair', we talk about 'mutually agreeable', we now have a standard to measure against. But then BOTH sides, conservative as well as liberal, must be considered. And that is not acceptable to most liberals. They do not WANT 'mutually acceptable' solutions, they want THEIR solutions, which they have simply declared to be 'fair' ones.

[kcjenkins]

No, Montana, we WANT it all our way, just like they do. But we don't expect to get it all our way. However, we would at least like to be offered a chance to arrive at a middle ground of 'mutually acceptable' compromise. The use of the word 'FAIR' corrupts the whole debate, is my point. Because if one side is declared at the start to the 'the fair side', where is the room to even debate a compromise?

[jainen]

>>The use of the word 'FAIR' corrupts the whole debate<<

So when the president talked about Saddam Hussein getting a fair trial, he should have said "mutually agreeable"?

[lbbwest]

As usual, you neglected an important part of the statement. So are you stating that Americans who work full time should live in poverty? Are you saying that only the members of the lucky sperm club are entitled to a living wage? Your statements sound as if you belong back in the feudal system. It sounds like you are saying if you are born into a family that encourages and supports you to have minimally an undergraduate degree you are worthy. If you are born into a family that's poverty ridden, you are just going to stay that way. I thought you right wing zealots were big believers in personal responsibility. There are thousands of Americans working full time, live in poverty, and have to medical care. What's there incentive to keep working? Too bad for them? I've got it, you don't like Hillary Clinton. You are right wing. You are Republican. When did this new site become a zone for the ultra conservatives? I haven't had time to read much lately, (putting in a new computer system) but I used to have a lot more respect for you KC when you talked about tax. I agree to disagree. I will check in on this site soon, and if it continues to be a love fest for the right wing moral majority I will move on. lbb

"Seventh, let's ensure that people who work hard every day can support their families and save for the future. I do not believe anyone who works full-time in America should draw a wage that puts that person below the poverty line. If you are a full time worker you should make more than poverty.

Now that we've finally reach the minimum wage, let's expand and simplify the Earned Income Tax Credit so no one working full time lives in poverty."

[zeke]

Now, if we can just agree on the definition of "poverty"....

Zeke

[MAMalody]

...and maybe where personal responsibility comes in.

[MontanaEA]

No, Montana, we WANT it all our way, just like they do. But we don't expect to get it all our way. However, we would at least like to be offered a chance to arrive at a middle ground of 'mutually acceptable' compromise. The use of the word 'FAIR' corrupts the whole debate, is my point. Because if one side is declared at the start to the 'the fair side', where is the room to even debate a compromise?

KC, who the heck do you think "they" is? - some of us on this board, that's who! Like LLBWest, if you can't stop disparaging us and move back to the topic of tax & software, I'll be moving on. Funny, I don't seem to enjoy being insulted on a regular basis.

[kcjenkins]

KC, who the heck do you think "they" is? - some of us on this board, that's who! Like LLBWest, if you can't stop disparaging us and move back to the topic of tax & software, I'll be moving on. Funny, I don't seem to enjoy being insulted on a regular basis.

I honestly do not see how asking that such 'loaded' words as 'fair', which are never defined, be left out of the debate, amounts to insulting you, Montana. I certainly did not intend to insult you. Still, it seems that this over-reaction just illustrates my point. I started out talking about the tax angles of the political debate, and asking for a non-judgmental discussion of it. Now I am being attacked as being unfeeling, uncaring, greedy, mean and disparaging. Oh yes, and a right-wing zealot, too. Clearly, I can't win, if even bringing it up means I am a bad person.

Why is it that liberals like you can't just debate the issue, and instead have to attack the decency of anyone who does not agree with them? I did not attack anyone, here. I just raised a question. But, see, just as I said earlier, I am now declared to be UNFAIR for even asking that the issue of 'fairness' be left out of the debate, and instead, some actual measures be used instead. You sure proved my point.

At least, LLBWest did not attack me personally, and did raise some real questions, which I promise you, LLB, I will address as soon as I have a few more minutes to respond. I respect him more because his response, while I see lots of problems with it, is at least in the nature of a debate, not a personal attack.

[kcjenkins]

>>The use of the word 'FAIR' corrupts the whole debate<<

So when the president talked about Saddam Hussein getting a fair trial, he should have said "mutually agreeable"?

Actually, the point there was that the trial was seen BY THE IRAQI PEOPLE, generally, as 'fair' because all the sides had equal input into the new constitution, and he had extensive representation from multiple attorneys, and a very lengthy trial in which he was allowed to question his accusers. Not like the kind of justice he handed out to his people when he was in power. Even his execution was much 'kinder' than the use of wood-chipping machines used as the method in his day.

[joanmcq]

Hillary outlined her economic fairness doctrine: “There is no greater force for economic growth than free markets, but markets work best with rules that promote our values, protect our workers and give all people a chance to succeed. Fairness doesn’t just happen. It requires the right government policies.”

So, according to Hillary, free markets work best when they’re constrained by the "right" government policies. In other words, free markets work best when they’re not free. I find that really scary, myself. Sadly, tho, I think a lot of people will read or hear those lines of hers and think she is right. Because they will not really think about what she is implying. They will just react to the term 'fairness', something everyone wants. Not realizing that letting the government decide what is 'fair' is not really something they would want to do, based on past experience with government 'services'.

With no government interference we have the robber baron era. No minimum wage, no overtime for over 40 hours, no worker's comp, no right to unionize. No fines for dumping toxic waste in our waterways and air....remember the Cayahogo river catching fire? I lived in Pittsburgh before the clean air and water acts, and grew up thinking rivers were brown, with dead trees on the banks. That was a lot of government interference in business and the businesses complained the extra costs would put them out of biz. Didn't happen.

I happen to like the fact that my money is safe in my bank.....FDIC insurance is government interference. jeez, even look at what the SUV loophole in the luxury auto limits did to encourage people to buy big, unnecessary gas hogs that contributed to our overdependence on oil, and encouraged the automakers to keep making big gas hogs instead of fuel efficient autos...wrong government policy there.

Like I've said before, I've been terrified for the last 7 years.

[kcjenkins]

As usual, you neglected an important part of the statement. So are you stating that Americans who work full time should live in poverty? Are you saying that only the members of the lucky sperm club are entitled to a living wage? Your statements sound as if you belong back in the feudal system. It sounds like you are saying if you are born into a family that encourages and supports you to have minimally an undergraduate degree you are worthy. If you are born into a family that's poverty ridden, you are just going to stay that way. I thought you right wing zealots were big believers in personal responsibility. There are thousands of Americans working full time, live in poverty, and have to medical care. What's there incentive to keep working? Too bad for them? I've got it, you don't like Hillary Clinton. You are right wing. You are Republican. When did this new site become a zone for the ultra conservatives? I haven't had time to read much lately, (putting in a new computer system) but I used to have a lot more respect for you KC when you talked about tax. I agree to disagree. I will check in on this site soon, and if it continues to be a love fest for the right wing moral majority I will move on. lbb

No, LBB, I'm not saying that people who work full time should live in poverty. But neither am I saying that they should never live in poverty, either. The fact is that some people, as you know, simply are not capable of working well enough to be worth enough money to get out of poverty. That is simply a fact, and IF it is not their fault, there are lots of ways that our government helps them make up the difference. I fully approve of that sort of help, where the worker is doing as well as he can.

If they are not worth a decent wage because they dropped out of school, and because they have such low skills and low work ethic that they are not able to keep a job, then I don't think that means we have to just work harder so that we can provide them what they are not willing to work for themselves. The fact is that 'minimum wage' workers are almost all either beginners or they are people who do not stay on any job very long, or are such poor workers that they are not contributing enough to earn more than the minimum. Or they have a drug problem, serious attitude problem, etc.

I do object to the idea that anyone who is capable of working but just does not want to, has an automatic right to the wages of those who do work hard. And the truth is, as you know if you have tried to hire a worker lately, hardly anyone makes the minimum wage, and if they do it is only for a short time until they get a raise. I live in a rural area of a low-wage state, and the STARTING wage at fast food places is $7 here. And any job that requires any sort of skills or education starts around $10 an hour, or more. That plus the fact that it is hard to even find anyone worth hiring that does not already have a job makes it hard for me to believe that there are lots of 'hard working, honest workers' who can not find a job making more than minimum wage. It just goes against what I see in real life, LBB.

As for the education issue, if a student here in AR works hard in high school, even in this poor state there are multiple sources of money for them to go to college. They do not have to be rich to get a college degree, LBB. they just have to be willing to work hard at school. I doubt if that is less true in other states. It will not be a Premium School, perhaps, but the opportunities are still available.

I've taught at the University here, and believe me, the most frustrating thing for me as a teacher was how poorly prepared many of the students were. They had frittered away their high school years taking the easiest classes they could get, doing the least they could do to get by, and then expecting the college level courses to stop and teach them the basic things they should have come into college already knowing. When faced with higher expectations, many of them just dropped out, rather than face the challenge and start actually studying and doing their homework! I suspect those kids then treated their employers the same way, trying to do the bare minimum at work, while complaining about the low pay. I say that because I've hired some of them, and been frustrated by their attitude that they have earned their pay if they just show up for work, at all. Heaven forbid that I should also expect that they turn off their cell phone and give me a full day's work, or that I should expect that they actually work their brain enough to file the folders in ALPHABETICAL ORDER! Or that they dress appropriately for an office, not a water park. And believe me, they don't even want the job in the first place, unless we start them at $7 an hour, with a raise after one month.

Now, one last thing. You complain that this site is a "love fest for the right wing". That is not the case, LBB. You are just as welcome to post your thoughts here as is any 'right wing nut' like me. I don't object to you posting your opinions, as long as you allow me and the other nuts the right to reply politely to your posts. So if you think it's leaning too much to the right, you are free to post to the left. Just label it "Political" if it's not about taxes [please note that this one started out about a tax issue, which has been ignored mostly], and keep it polite, and I will support your right to do so completely. We do not have to always agree, in order to benefit from this board. A little friendly debate can enliven all of us. I don't have to agree with you all the time, in order to respect you, and it goes both ways.

[jainen]

>>I can only see that 'simplifying' as increasing the amount of fraud<<

It's kind of a cliche that people claim EIC using their girlfriend's kids, but I think most EIC fraud is just like any other tax fraud -- under-reporting income. I can't prove it, but it makes more sense to me looking at our vast economy of cash wages. I doubt there's anything you could do to EIC that would affect under-reporting one way or another.

I can think of many enhancements to simplify and expand EIC in ways that would build confidence and respect for the program without doing anything scary. The first thing I would do is cut off all the wealthy families by going back to the old tiebreaker rule about highest AGI. Then I would move more of the credit into Advanced EIC, so workers get the benefit immediately in a form they can easily compare to not working, eligibility is somewhat monitored by employers, and there isn't the temptation of a large payout for a single signature.

[kcjenkins]

At last, a real answer with some real ideas. Good ones, even. Thank you, Jainen.

I doubt if the ideas Hillary will put forward are the ones you mentioned, but I certainly hope they are. While I suspect her 'simplify' means reduce limits on eligibility, not tighten it like your first idea would, yours is a good idea. However, I believe the argument made when they removed that test was that just because one ex-spouse was rich did not mean that the other one got any benefit from that fact.

I really like the idea of making at least part of the EIC only available through the advanced EIC in their paycheck. I know that there are sometimes problems with people getting too much that way, and then having to repay, but there are ways to take care of that. And you are right, getting it tied to the wages would help make the mental link between working and getting it. But then, what about the ones who get it for Sch C income? It's still a good idea, tho, for the W2 workers, at least.

[taxxcpa]

As usual, you neglected an important part of the statement. So are you stating that Americans who work full time should live in poverty? Are you saying that only the members of the lucky sperm club are entitled to a living wage? Your statements sound as if you belong back in the feudal system. It sounds like you are saying if you are born into a family that encourages and supports you to have minimally an undergraduate degree you are worthy.

Now that we've finally reach the minimum wage, let's expand and simplify the Earned Income Tax Credit so no one working full time lives in poverty."

I can see how you may think she was implying that some people should be stuck in the 'class' in which they were born like in the Feudal system. However, I see no such implication. I have known a lot of people who have moved up from poverty. Some of the top administrators in the Dallas School system were the children of migrant workers. I believe the current superintendent came from such a family. Some others who grew up when I was growing up also came from Mexican descent--which usually meant discrimination by Anglos, yet managed to became highly successful: one becoming a four-star general to whom Colin Powell and Norman Schwartzkopf once reported to and who they mention favorably in their autobiography. The general's brother became President of Texas Tech and later Secretary of Education.

When I worked at ARCO I once attended a meeting of all Management employees in which we were asked to tell a little about ourselves. All but one of us (the only female in the group) mentioned that we had grown up in a low-income family.

Things like the earned income credit provide a hand-out but do not provide an incentive to do better. Often it may have the opposite effect--if you make more money you offset it by losing part of the EIC. The EIC is probably justified when someone needs a temporary helping had like one of my clients who hurt his back and was unable to work in his normal capacity for a year or so, but who later recovered and went back to work.

But even if the EIC is fully deserved, it is still one of the biggest ways to cheat since people 'borrow' children to claim in order to get the deduction. The IRS cannot possibly do enough investigation to weed out the cheaters.

The government would do better to find ways of guiding people to more productive lives (if that is possible) and should stop the process of creating generation-after-generation of welfare families by the misguided programs which seem humanitarian on the surface, but have the effect of giving a man a fish instead of teaching him how to fish.