The Cold Civil War

No what I’m telling you is that the idea that profit isn’t considered when you increase MY taxes is patently absurd.

You’re making a theoretical judgement that doesn’t associate with real-world actions. If you’re going to tax me on the money I make on my business (along with EVERYONE else in my market sector) why in God’s name would I simply choose to take that loss as opposed to offsetting that loss in the SAME manner that everyone else is. Elasticity if demand is irrelevant when we are discussing an increase in overhead of EVERY player in the market.

And whether you want to admit or not the tax you take from MY personal income that I earn from my business is not only factored in, but is of utmost import.

 

No I’m not. I’ve made more than my fair share doing this. And so has every other business owner.

When you go to school for business management this is taught in the textbooks. How to offset costs such as increased taxation.

You don’t own a business you’re proffering theories from failed economics professors.

 

I do this EVERY day. Literally EVERY time that the left has increased taxes on the rich my bottom line has increased. Because it gives me and every other business owner an excuse to cut costs and increase prices.

Every. Single. Time. Without exception I’ve profited from tax increases on the wealthy. While my employees and customers have suffered.

You don’t know what you’re talking about. You’re parroting BS that you’ve read from a textbook. You’re not engaging in real world business.

 

First, I do own a business. Admittedly it's highly productive and doesn't employ minimum wage workers. Second, I have referred to the empirical evidence. This isn't based on my opinion. It is based on empirical testing of supply and demand. You'd appreciate that if you understood supply and demand.

 

No i do but you’re acting like I can’t just sell the business or shut its doors.

I’m only going to stay in a business insofar as I’m able to pay my bills and make enough of a profit for it to make it worth my time and effort to run the company.

If you tax me I will decrease costs or increase price. And yes over time the laws of supply and demand will put enough of a constraint on me that it won’t be worth my time or money. But I won’t lose. I’ll make profit during that entire time until it becomes untenable. Then I will close the business (preferably sell it) and find another business to invest in with more of a profit margin and continue the same practices I was before until that become untenable and move on to the next business.

That’s how this works.

 

But I mean you already know this.

Hypothetically if you’re a business owner and the left says we want to take 70% of the income you make for taxes. What will you do?

You will either find a way to cut costs, increase price or shut your doors. Right?

 

You can adopt 'to spite your face' reactions. I wouldn't. Now it is true that the source of monopsony is key. Firm exit effects are more likely if it reflects worker preferences. They are less likely due to job search frictions. However, the evidence is clear: significant disemployment effects aren't likely.

No, that's how erroneous comment works. You've confused an increase in production costs with a tax on you. That isn't cunning. You've then failed to understand the importance of supply and demand conditions (and why price increases are actually rare). That is ignoring the evidence.

 

I thought you weren't a US citizen.

 

You're again asking me to make decisions that harm profit. I wont cut costs. Indeed, I find organisational slack is crucial for my firm's creativity. I wont increase prices. That would just encourage firm entry. I wont shut my doors as I'm still making money. I'd work harder.

 

So much fear, anger and negativity on the left. Really sad.

 

Wrong, he is a successful entrepreneur.

 

Your subject matter knowledge of how business actually works leaves a great deal to be desired.

Your COMPETITORS won't raise prices and produce substandard products.

You will LOSE SALES when your RAISE PRICES and produce SUBSTANDARD products.

You will go out of business because that is how the market works.

 

FALSE equivalence logical fallacy!

Increases in your PERSONAL TAX RATE has NOTHING to do with Minimum Wage.

Increases in your PERSONAL TAX RATE has NOTHING to do with corporate profit or loss.

 

When was the last tax increase on the wealthy?

 

I am NOT responsible for your absurd misconceptions about other members.

 

Such poor reading comprehension on the right!

Really sad!

 

Absolutely ridiculous. You have to be being obtuse.

“Work harder” isn’t a business strategy. What happens when your “working harder” doesn’t make up for the 30% loss you’re taking on your taxes?

Let’s look at an example.

You’re currently running a business at a Net profit of 100,000k. The government comes in and increases the taxes on the profit of your business up to 70%.

So now instead of bringing in 100k a year, you’re only bringing in 30k a year. You employ your business strategy of “work harder” (whatever the crap that means). And your imaginary business strategy increases your net profits by 15k and you’re now up to 45k. But significantly lower than the 100k you would be making without the taxes.

You’re going to sit here with a straight face and tell me that wouldn’t impact how you run your business?

 

Trump hasn’t ignited anything. He’s a reaction to the radical left socialists/communists.

 

Another orange man bad thread. What a surprise.

 

If you have ever run a business I can guarantee you that it didnt last long.

 

Diving from macroeconomics to microeconomics is always a weird transition. What you have described here is a self-centered economics. Any Rand would approve. A basic rule of economics ( and business practice) is that cost does not price (unless you are a monopoly). The market couldn't care less about one's costs - the price is right or you're out of Dodge. Which is always your option. A business owners personal tax rate is of little interest to the market and has little effect on the bottom line until revenue starts to be affected. The bottom line is that you (business owner) just want to keep the money, which is the mantra of most of America's wealthy. After all, we are not communists.

When income disparity gets too great, the wealthy become too wealthy, and the tax system is unable to level the playing field, there is still an option, Revolution. Here is where we dangle on the edge. Here is where American division becomes of a concern. Instead of uniting America, trump seeks, with every tweet or utterance, to divide it. This is a VERY dangerous game and requires one with a sense of history to know better than to play it. Taxation can play a role in this, however U.S. tax policy has aimed to increase the wealthy of the wealthy and Americans are slowly beginning to realize this. And the danger grows.

Throughout American history, tax policy has aimed to foster growth and national well being while avoiding the establishment of a permanent aristocracy. Whether we have arrived at that point is a matter of hot debate. As long as Trump is in office, the divide will deepen and the hunger for change, especially economic change, will grow. Once the bubble pops, the change will be dramatic. possibly violent, and not to the liking of wealthy Americans. Perhaps not even for the good of America. Is this inevitable? In my view, yes. There is little on the horizon to stop it.

The divide continues to deepen and the current government seeks to deepen it further. So far, their misrepresentations )tax cuts are good for the middle class) and lies (job creators, trickle-down economics) have held. So long as the propaganda and lying holds up, so far so good. But, there are increasing signs that Americans are becoming suspicious and doubtful the government governs in their interest. It is good that Americans can vent every two years at the ballot box. Trump's continued efforts to divide America will come into full view in 2020 and the voter reaction will be catastrophic for Trump and the GOP.

This is how we have, and will, stave off the terrible option of violent revolution. Will we do it again? Probably. It's really up the opposing party to carry the water. It appears the Democrats have fielded a positive looking list of candidates, intent on offering an array of solutions to pressing problems in health care, immigration, and high quality job creation. If elected, then they m must govern. Something we haven't seen in a while. If they fail, then there is the other route.

 

I'm sorry that I behave differently to your tabloid opinion on how I should behave. How terribly inconvenient of me!

Its a reference to your error. You have deliberately confused an increase in production costs with a tax on your income/wealth. That isn't cunning! I actually referred to supply and demand correctly. If I am taxed more, given income effects dominate substitution effects, I would work more. Substitution effects only dominate for the low paid. Its only the poorer members of the society where we have standard work disincentive effects.

Of course it wouldn't. The business is still worthwhile. The profit maximisation decisions (e.g. how many workers to employ; how many units to produce etc) have not been affected. The only issue, which I've already told you, is whether a reduction will harm subsequent investment.

 

I have a very successful business dear chap. You seem to have a fetish for being wrong.

 

Anyone can be anything they want to be on the internet.

 

That’s so incredibly delusional.

You are the epitome of someone who spouts economic theory with zero real world experience.

If you HONESTLY believe that a 70% reduction in profit wouldn’t cause a business owner to reevaluate costs and pricing in his business to offset that loss you don’t need to be having this conversation with anyone.

Because while the business may still be profitable the profit realization is vastly reduced. Making the investment and time in the business not worth the business owners time and money unless he can generate more profit.

Either he will generate more profit by cutting costs or increasing price. Failing that he will sell the business or simply shut the doors and invest his time and money elsewhere where he can realize more profit.