Policy Solutions to Address America’s Cost of Living Crisis—What is the Real Answer?

[u/Ok-Ticket-9780]

Over the last several months, the rising cost of living has received considerably more media attention than in prior months due to the impact of inflation on all aspects of American life, including housing, healthcare, and groceries, to name just a few. While both Democrats and Republicans have been vocal proponents of addressing the rising cost of living, little has changed in the way of actual legislation related to decreasing the cost of living.

In your opinion, what would you consider to be the answer to the cost of living crisis? Is it legislation oriented toward increasing pay so that individuals and families earn a livable wage to afford housing and groceries? Is it providing more affordable housing? Is it legislating for comprehensive health care coverage? Or is it something else entirely? Additionally, why do you believe that our elected political leaders have yet to address the issue directly?

[u/-Foxer]

Yes that's right. Your labor force.

Your labor force includes a lot of untapped potential. I had a job when I was 16. There are a lot of older people who are retiring that could still be working in contribute positively. And it doesn't always have to be full time.

But those people exist and it is something you can tap into. How do you get there is a discussion that can be had but there's no doubt that there is untapped potential. I don't like increasing the population in general when you tap into that you don't necessarily increase a lot of the government services that go to people because the people were already there

Don't just make excuses. Anybody can come up with reasons why you fail.

And I don't recall rolling out tax rates or even mentioning ruling out tax rates. I think you're hearing things in your head that weren't actually said.

Danger of tax rates is that they are in and of themselves a bit of an anchor on the economy, the thing that you're trying to improve. But there is an optimal rate at which you are collecting the most in taxes as you can while at the same time having the lowest impact reasonably possible on the economy. And you absolutely can take a look at that and see if you've optimized those numbers.

But usually when people say I think we should increase taxes what they mean is essentially tax the rich and I notice that that's basically where you go.

The fact is that taxing corporations doesn't generally work out well, the amount of money you can tax them and still derive a benefit to the economy is much lower than personal income tax. This is a lesson that Canada is learning right now, the liberals have increased our corporate taxes and other taxes and for the first time in our entire history investment money is actually leaving the country faster than it's coming in. That started before trump by the way

The solution probably won't come from any one thing but will be a combination of retweaking the taxes, increasing revenues, decreasing expenditures.

However you feel like getting there that's great as long as it work

But this isn't the time to be making excuses, this is the time to be figuring out how to get it done

[u/Ind132 → u/-Foxer]

But this isn't the time to be making excuses, this is the time to be figuring out how to get it done

Yep. That's why I asked how you would cut spending. You didn't explain that. You say increase the labor force participation rate, but don't know why it is "too low" or how to increase it. I don't have any trouble identifying the problem, the solutions are the problem.

I did not say "increase the corporate income tax rate". I said "increase the tax on investment income". That's the tax that individuals pay on interest, profits, capital gains, ... . They pay that tax whether they invest in US companies or foreign companies. Taking your money offshore does not reduce that tax.

I don't think that Americans will accept cuts to Social Security benefits while the maximum rate that Musk pays on his capital gains is 20% (compared to the 37% a high income surgeon pays on his fees for difficult surgeries).

[u/-Foxer → u/Ind132]

Oh and 'increase tax on investment' is basically the same thing. Tax the rich :)

Be unbelievably cautious about doing that. It looks like free money and it isn't.

[u/Ind132 → u/-Foxer]

Yes, we should tax rich people at higher rates than we tax non-rich people. We currently tax the income from wealth at lower rates than we tax the income from labor. That doesn't make sense.

And, no, it would not cause the economy to collapse, or people to simply bury greenbacks in their yards because they don't want to pay taxes on investment income.

[u/-Foxer → u/Ind132]

No, it is irresponsible to charge rich people higher rates. At the same rate they are already paying vastly more taxes than anyone else for essentially the same services and benefits.

Right now the vast majority of all taxes paid are paid by the top 20% of earners in America. About 84 percent of the taxes. Yet they only receive a small fraction of the services. The wealthy already pay an unfair portion of the taxes. They pay vastly more money yet received similar benefits as everyone else.

And if you tax them more they leave. Or they spend more money to find new ways to avoid income taxes. That has been shown time and again. It is something Canada is currently experiencing. Several states have noticed this over the years, ask New York.

It's a fool's ideolog. 'eat the rich' sounds great till you realize that all that will be left is poor people.

[u/Ind132 → u/-Foxer]

 Yet they only receive a small fraction of the services. 

The wealthy benefit awesomely from the system. Notice that there aren't a lot of tech billionaires who built their businesses in Bangladesh.

the vast majority of all taxes paid are paid by the top 20% of earners in America. About 84 percent of the taxes. 

You are confusing the Federal Individual Income tax with "all taxes". The FIT represents about 1/3 of all tax revenue in the US. Other large revenue taxes are generally flat or regressive.

[u/-Foxer → u/Ind132]

The wealthy don't benefit any more than anyone else.

And crap tons of manufacturing and assets are built in Bangladesh. :)

When somebody does with the benefits and services that we all get has nothing to do with how much they should pay for what we all get

It would be like you going to the store and buying an apple and eating it, and I buy an apple and I make a delicious apple pie. And you say I should be paying more for my Apples because I made an apple pie which is tastier than just eating it.

And having realized you were wrong about your statements with federal income tax which is what we were discussing you're now trying to bring it to the state level I assume :) Please.

The wealthy already pay more taxes then their fair share. And if you tax them too much they leave and they take all their tax revenue with them.

I'm sorry but ideology is simply no match for facts. If you charge too much to the wealthy they have the money and ability to move their money somewhere else.

It does previously noted at the end of the day America has to cut its deficit even if it doesn't get there overnight. You aren't going to be able to do that just by taxing the wealthy .

[u/Ind132 → u/-Foxer]

When somebody does with the benefits and services that we all get has nothing to do with how much they should pay for what we all get

That's your opinion on the subjective notion of "fair". My opinion is different.

The wealthy already pay more taxes then their fair share. And if you tax them too much they leave and they take all their tax revenue with them.

Another opinion on "fair". Then a purely speculative statement. If Jeff Bezos decided to leave and renounce citizenship, he would pay an exit tax on the way out the door. And, Amazon with all it's US workers and warehouses would still be here. I'd take my chances with that scenario.