President Joe Biden says his $5 trillion ‘Build Back Better’ plan costs ‘zero dollars.’ With that same zero dollars, we might build 500 Nimitz-class aircraft carriers. His fellow new-math Democrats feel a planned corporate tax hike won’t flow through to the rest of Americans, because, as press secretary Jen Psaki says, it would be “unfair and absurd” for corporations to raise their prices in response to a higher tax bill.
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40 replies on “Biden New Math: Claims $5 Trillion ‘Build Back Better’ Plan Costs ‘Zero Dollars’”
There’s a classic video out there called “Shopping Math” that perfectly explains the democrat budget logic. Check it out.
Back in times it was ridiculed. I recall some Married with children episode where P cretated money by buying her own MLM products. Lately this thinking seems become mainstream and replaced the real math.
Unfair and absurd? Corporations that provide products and services do not pay taxes. Not ever. Just like they don’t pay electric bills. The consumers pay it all. The price of doing business is rolled into the cost or they would go out of business.
just because the amount charged for the goods or services is factored in to the cost of doing business doesn’t mean those bills aren’t paid. have you ever been responsible for a green sheet? i have. believe me…EVERY debit is paid or the green sheet doesn’t balance. try presenting an unbalanced green sheet to the shareholders. smoke and mirrors to maximize profits? you bet but (again) the bills must get paid before the taxable gross profits are ascertained on the p&l. there are no smoke or mirrors that will create an opportunity to sidestep the power bill. not legally anyway.
respects.
I think Michael is saying that every penny of gross income is paid by consumers for the goods and/or services of the company. That has to cover all operating costs of the company. But I could be wrong and misunderstanding him.
That’s basically true, if that’s what he means. But net profits = gross income – costs and expenses. Net income is what pays the owners or investors for their risk and sunk expense of company operations. Which is what you seem to mean and that’s also quite true.
If a company can reduce those costs and expenses then net income is increased. If those costs and expenses are increased, including a higher tax liability, then net profit decreases. A company cannot ignore those costs and expenses including the power bill or their taxes. Those are very real, very significant, very important costs.
If a company does ignore those expenses it will soon find itself in both financial and legal trouble. TANSTAAFL, someone pays and everything gets paid for or else the wheels of commerce grind to a halt and no one wins. If the tax burden on a company becomes so great that the company can no longer make a reasonable net income after the costs and expenses are paid, the company will fold. Even if there is still some net income left over after expenses, because that’s not the be-all and end-all of business. Competition is a factor too and any company that can make a higher net income than its competitors will draw investors and market share away from those other companies. Etc.
In a way it’s a simple system in theory, in practices it’s not so simple at all.
Yes, I am saying that taxes are another cost of doing business. The corporation doesn’t pay them, the consumer does. Businesses only collect taxes, but the buyers of goods and services pay the taxes. Raising taxes on business is only raising taxes on all of us.
That’s what I thought you meant, and it’s very true. I didn’t mean to speak for you or put words in your mouth but it seemed like Donald Welch wasn’t picking up what you were laying down.
If you go buy a new Ford pickup truck, Ford Motor Company was the name on the check that went to the electric company to pay the electric bill but it’s the person who bought the pickup that ultimately supplied to money that made the check good.
that will never change unless of course we do away with our free market system. if all companies absorbed all costs…there would be no profits. no profits no businesses.
I don’t want to do away with the free market. It works marvelously well. I don’t expect corporations to absorb costs. Businesses cannot absorb costs and still make money, which is their purpose. You are correct, no profit means no business. My goal is to destroy the fantasy that a government can tax corporations to pay for their spending without that cost being placed as a burden on the citizens.
For perspective, we have ruled the seas and have kept the peace on the oceans for 70 years with less. We currently have only 10 Nimitz class carriers. Imagine what we could do with 500.
considering who is in charge…nothing meaningful or perhaps i should say helpful.
Probably the same our country can do with the 16k ventilators it bought at start of the plandemic. Later on we got hard evidence that with all space and personnel tut to use no more than 1200 can be operated. The rest can sit in the newly built storing facilities and someone seller made good profit. Maybe someone even got a medal for the great handling of the situation.
I wish you could have seen Mark Levin on Hannity last night. I tried to find it on bluetube, but they cut the show off (so typical) just as Mark was about to tell us the truth about the debt ceiling and more. Briefly, he said the government brings in 320 BILLION per month from Federal Taxes and User Fees. 44 Billion in new debt. You do the math!! Furthermore if the debt we owe is not paid, it is a violation of Federal Statute and the Constitution. That’s it…
You can watch entire shows on Fox’s website. I usually try to catch The Five and Gutfeld! the next day after they air.
I watch FoxNation everyday. Usually I watch Tucker Carlson Today and sometimes I’ll catch up on the beginning of Tucker Carlson Tonight that I miss on TV. Isn’t a great website? I really like it!
Yeah, I like it too. I prefer to watch the shows I like on the website because I have software that strips out all the commercials, can’t do that with a live broadcast. I usually have those playing in the background while I work during the day. If they’re talking about something that needs closer attention I can take a break for a few minutes and check it out.
To be frank, that’s the only major cable network I watch for news anymore. Fox News isn’t wholly unbiased but it’s orders of magnitude less biased than any of the other major outlets. Much nicer, better looking and smarter people too. I just don’t see the point in being insulted and lied to by Don Lemon, Brian Alka-Seltzer or the likes of Rachael Madcow. There’s enough of that floating around everywhere without purposely tuning in to let them dump on us.
Anyone knows what will happen to the debt ceiling rise this time? Just formal vote to kick the can or some negotiation?
A tax anywhere upstream is paid all the way to the bottom downstream.
That’s why Roosevelt created the personal income tax. It taxes the bottom end where the money originates directly and skips all the steps upstream.
There’s more than one way to skin the tax cat. New tax laws are one way. Printing more money and spending fiat currency into existence is another and it creates inflation. Which is a tax you cannot as an individual avoid. The government gets its money to buy votes and pay cronies by making your money worth less.
Potato Joe and his Merry Band of Robber Barons are doing both.
And just to tweak Bill a little on his hyperbole: 500 Nimitz class end to end would stretch approx 100 miles, not the over 600 miles from Bermuda to closest US shore.
You could however completely surround Bermuda with it coastline of approx 65 miles. Which would be wicked cool to see.
Also, that same 100 miles of potential carrier deck would be a bridge from Taiwan to Mainland China.
In principle I wouldn’t be against deficit spending if it was limited and used appropriately (which we know is politically impossible). Businesses use that sort of math all the time to get ahead – i.e. you do something like average the growth of the last few years, and forecast the amount of deficit spending you can get away with. If government’s deficit spending was limited to average of percent gdp growth of the last 5 years, it would work out.
Scott mentioned some things businesses can do when taxes increase. He missed some. The four overall things they can do in response are: 1) Increase prices. Obvious on this. 2) Reduce expences. This consists of tax avoidance, reduce employee cost (fire some, no raises, do automation making firing easy, turn to part time so as to skirt the requirement for health care and more), reduce quality of supplies by buying cheaper (Grocery stores buying and selling cheaper inferior products for same price for example) 3) Accept lower profits, thus lowering mutual funds and 401k and 4) Go bankrupt. Mutual funds and 401k take a hit again, people lose their jobs, and lowering choice for consumers of said goods and services. Probably also forcing to get more expensive options as that is all that’s left. Some businesses may go through all four steps. There is no such thing as a free lunch.
There’s one more way that I can think of, and I’m not a tax accountant so there may be more — Or you might call this #2b of your examples …
Move assets and core business functions off shore. To countries that have a more favorable tax structure, cheaper labor, and a better climate for the business type in question.
Of course this drives those businesses beyond reach of Potato Joe and his merry band of robber barons but hey … The Democrat Left has never worried about things like the bigger picture, long term effects, reason or logic. Why start now?
Correct. Moving offshore to.a better tax location is a typical move of tax avoidance. I guess a 2 c may be: the automation issue has a tax component in it. Say you spend a million on automation, knowing in ten years you are way ahead in costs due to fewer employees. In addition you can depreciate the asset over time, lessening tax. You can depreciate in a straight line over, say ten years at $100,000 a year, or accelerated over ten years. First year $500,000, then depreciate after in decreasing amounts. That could put your tax at zero the first year. If the law changed, you could be way ahead. Yes, I took accounting classes. Its amazing how your income can change depending on how you do the accounting. And yes, Democrats have what seems to me an allergic reaction to reason and logic.
You are correct. Ireland is one of the current favorites.
A close component of this continues to be off-shoring. Moving less complicated labor to cheaper locations. Very popular in the late 80s early 90s.
The Dominican Republic along with some other Caribbean islands were good locales.
For an interesting exercise in the negative power of bad government, the D-R standard of living grew as more companies hired them for simple labor and then embraced resort life. Haiti (which shares and island, but has long been a tyranny of family dictatorship) has remained quite poor.
Ask a progressive to explain the differences in outcome when the underlying reality is much the same.
Exactly so and … The D-R rolls some dandy handmade cigars too. Though I generally go for Nicaraguans.
Come on guys! We are being mocked and disrespected. They know that their arguments are BS but there is no reason for them to limit the BS. The more the better.
Rational arguments and examples by yous and others both miss the point (the Democrats don’t care) and take the public’s eye off the central issue- we are being screwed with.
How about someone just coming out and saying that we are being F-ed with?
Bill knows the rhetorical theory- put it into action.
Wouldn’t it be nice if more people would ACT!
i’ve followed bill for decades and i can tell you he has changed since he got married.
Don’t we all!
This is unfolding around the world. We know they are doing it. They know that we know they are doing it and we know they know that we know they are doing it. And yet, here it is!!!
the silent followers of these evildoers are the millions of ‘conservative’ women who (when the shite hits the fan) always opt for a go along to get along campfire so as to not lose any panera bread, starbucks shopping for new pink shoes posse members.
i know that’s a harsh statement but the left knows it’s true and so…here it is.
WRT Scott’s point about corporations and suppliers, while the situation of manufacturers and providers going to their suppliers looking for reductions does occur, this is not the current situation. Here is what has happened in the past 6 months.
We as an OEM received notifications from many suppliers of cost increases due to the increases in commodity costs and other costs. We spent a month consolidating our cost increases and presented our clients with increases, as did their other suppliers.
This led to some providers announcing price increases of their products starting Oct 1, followed quickly by their competitors doing the same.
Wages and salaries are frozen since there will likely be a reduction in sales due to all of the price increases.
Play this out across industries and you get less revenue, less profit, oh and less taxes even at higher rates.
This is one of the reasons that Green’s Law of Tax Revenue is accurate, because the real world reacts to cost changes even if congress doesn’t.
Oh, and for the mathematically challenged congress critters of all ilk, corporations pay taxes on profits. If there are no profits, there are no tax revenues. 23% of 0.00 is 0.00. 28% of 0.00 is 0.00. 35% of 0.00, well you guys get the idea, but there is a real 0.00 out there just as the real minimum wage is 0.00
As this is getting to be as long as one of ACTS short ones, I will step down off my soap box now and let others have a turn.
LOL, well … I don’t think you can touch me without another few tens of thousands of words but be that as it may …
What I find amazing, and by that I mean unfathomable, is how the Left wants to eat the goose that lays the golden eggs. If they did the things Trump was doing and the economy was booming along as it wants to do naturally if you just release the brakes — Then they would have a lot more tax revenue for their Utopia programs. They’d be able to buy more votes, the populace would be happier, healthier and more prosperous, and Democrats would actually be a lot closer to the lock on power that they so desperately seem to want.
And if they did that and the economy was roaring along, then they upped tax rates on the rich, they’d have even more Utopia money and it would be a lot less noticeable that they were skimming that much harder too.
But they insist on shooting themselves in the foot, crippling the economy, upsetting at least half the populace and doing things that not only make them unpopular with swing voters but they’re shedding voters from their base like a drowning rat sheds fleas. Trump got the highest percentage of black and hispanic voters of any Republican in history … That ought to scare the crap out of them and bring them back to reality but it doesn’t.
It just does not seem to make any sense to me. And that is why I’m certain there is more to their agenda than what they’re telling us. Their actions do not match their words, not even close.
from those with means…to those with needs. or in just one word…equity.
new world order.
here’s the ticket…..k12 teaches kids to lie and also to beleive other’s lies so by the time they reach adulthood they don’t actually see themselves as liars or others as liars. think about a white female who now identifies as a black female. i’m just saying.
For years I made the fallacious assumption we could have a rational converstion with The Radical Leftists that’s taken over the Democratic Party on the debt.
1) We had referendum on the issue in the 2012 presidential election and we lost. If we couldn’t make the case then we won’t until the debt becomes a crisis.
2) The fact that Leftists will accept any talking point that makes them feel good, no matter how absurd, makes honest discussion impossible. I can’t remember who said it, but “You can’t reason someone out of aposition they haven’t reasoned themselves into”
The sad part is that our “media” is so dishonest that the Biden* administration knows there’s nothing too stupid that the press won’t unquestioningly push it
I’m far less concerned about the HUGE spending. We’re 30t in the hole now. What concerns me about this “infrastructure” bill are all the thing buried in the bill. Things like nationalizing election or, like CA, outlawing freelancing.
with unfunded public liabilities added in (why wouldn’t they be?) it’s closer to 60t. suck on that lollypop .
And things like $200,000,000 for Nancy Pelosi’s park in SFO. Geez.