The Amusing (to Republicans) Tag Team of Senators Manchin and Sinema

February 15, 2022

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3:25 am

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28 comments

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Economics

Senator Manchin from his Facebook page. Tax hike comment by Mish.

Shifting Roadblocks

Senator Manchin says he favors higher taxes to fight the national debt and inflation. Seemingly, Democrats should be thrilled at this turn of events.

However, Senator Krysten Sinema of Arizona Is Now the Roadblock.

Democrats hoping to resurrect the party’s economic agenda are facing a problem: Sen. Joe Manchin’s goal for raising tax rates clashes with Sen. Kyrsten Sinema’s opposition to doing so.

Mr. Manchin has pointed to raising the corporate tax rate to 25% from 21%, raising the top capital-gains rate to 28% from 23.8% and increasing taxes on private-equity managers’ carried-interest income.

But Democrats abandoned those tax proposals last year because of opposition from Ms. Sinema (D., Ariz.).

Other Democrats broadly support the tax increases that Mr. Manchin is again advocating, but dropping the proposals became one of many concessions the party made to Ms. Sinema and Mr. Manchin over months of talks last year. The compromise surprised many in the party.

“The end result does include the lowest common denominator the party agrees on, which is higher taxes on the very, very rich and also on corporations, but gets to that in a manner that no one left to their own devices would have devised,” Jason Furman, who was a top economic adviser to President Barack Obama, said of the House bill.

Lowest Common Denominator

The lowest common denominator is to do nothing. I hope it stays that way.

I am all in favor of reducing the deficit by cutting spending.

Toss in national right to work laws, bankruptcy reform, and the end of collective bargaining for public unions, and ending tariffs and then I would gladly accept tax hikes too. That’s what the country needs but every item on my wish list is off the table.

That means, the best we can do is hope for the lowest common denominator: nothing at all.

This post originated at MishTalk.Com.

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28 Comments

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wmjack50

2 years ago

These two some what sane Democrats are heroes for stopping the hyper spending the Democrat Party wished to lavish on their voter base of dependent illegals and dependent citizens

KidHorn

2 years ago

Having long term cap gains taxed at a lower rate then income has never made sense. Generally speaking, people who make money off capital gains are much better off financially than those who rely solely on income. All cap gains should be taxed as income regardless of how long the assets were held.

whirlaway

2 years ago

Reply to KidHorn

That is what John Hussman has been saying for years, if not decades.

SOGMeister

2 years ago

Reply to KidHorn

The idea is that a portion of the gain is simply inflation and you shouldnt pay tax on the Govt’s active debasement of the currency.
Australia used to have an inflation indexed CapGains tax system, ie you indexed the cost base for inflation and then calculated your capital gains.

The Labour ( middle left) Govt removed this as they discovered that most capital gains were simply inflation and they raised more tax revenue by using a discounted tax rate like the USA.

StukiMoi

2 years ago

Reply to KidHorn

“All cap gains should be taxed as income regardless of how long the assets were held.”

Sure. And all income should be taxed at 0%.

What makes zero sense, is to tax “gains.” Period. Whether those are nominally paid out as “income” or as “capital gains” (as if the two differ even one iota anyway….) All you do by doing so, is taxing economically responsible stewardship of a resource. While subsidizing incompetent, wealth destroying, stewardship. IOW, you are taxing competence. Redistributing wealth: From from those competent enough to use their control over a scarce, valuable resource to create more value. To those who, OTOH, use their control over it to simply waste it and creating no gains.

Instead of taxing the gains generated by competent resource stewardship by those who control a resource, it is the control of the resource itself which is the legitimate, and economically efficient, source of taxation. IOW, taxation of property. Not the results of what people are able to accomplish with their property. It costs society just as much to maintain the institutions which protect the property “owned” by a value destroying moron, as ditto someone competent enough to produce real gains. Why the heck should the former be rewarded, at the expense of the latter?

Dr_Novaxx

2 years ago

These 2 senators are some of the greatest patriots in U.S. history. I tip my hat.

whirlaway

2 years ago

Reply to Dr_Novaxx

You must also tip your hat to the entire DONORcrat Party in California. They have the governorship and 75% majorities in the Assembly and the state Senate, and refused to even put single-payer health insurance to a vote.

RonJ

2 years ago

Reply to whirlaway

I heard it would mean a doubling of taxes, here.

whirlaway

2 years ago

Reply to RonJ

So, if your taxes are $15K, you pay another $15K? How much are people paying for health insurance? I remember paying $29K in one year. And that was under COBRA. In the “free” market, it could have been $45K or even more.

Casual_Observer2020

2 years ago

Manchin use to be for higher interest rates. Maybe his constituency can’t afford it anymore.

StukiMoi

2 years ago

Reply to Casual_Observer2020

Considering who the real, effective, ultimately influential constituency is comprised of for all Party Members in a pure kleptocracy: No, they can’t afford the loss of debasement theft that positive interest rates inevitably will entail.

Karlmarx

2 years ago

The American system of governance was not designed to function as a parliament but that is what the leaders of both parties have turned it in to. In a parliamentary system the failure of bbb (Brandon’s bad bill) would have been considered a vote of no confidence and we would be facing new elections.

whirlaway

2 years ago

Biden’s promise was that nothing would fundamentally change. He has kept his promise. The DONORcrat Party’s strategy to achieve that has always been through the use of “rotating villains”. Manchin and Sinema are but the latest bunch.

As Glenn Greenwald wrote:

“One minute, it’s Jay Rockefeller as the Prime Villain leading the way in protecting Bush surveillance programs and demanding telecom immunity, the next minute, it’s Dianne Feinstein and Chuck Schumer joining hands and “breaking with their party” to ensure Michael Mukasey’s confirmation as Attorney General; then it’s Big Bad Joe Lieberman single-handedly blocking Medicare expansion; then it’s Blanche Lincoln and Jim Webb joining with Lindsey Graham to support the defunding the civilian trials for (alleged) terrorists ; and now that they can’t blame Lieberman or Ben Nelson any longer on health care (since they don’t need 60 votes), Jay Rockefeller voluntarily returns to the Villain Role, stepping up to put an end to the pretend movement among Senate Democrats to enact the public option via reconciliation.”

RonJ

2 years ago

Reply to whirlaway

“One minute, it’s Jay Rockefeller as the Prime Villain leading the way in protecting Bush surveillance programs…”

There is a very recent news story about an unconstitutional CIA mass surveillance of Americans.

ajc1970

2 years ago

However badly Dems are beaten in Nov 22 (and it will be badly), they’ll owe a debt of gratitude to Manchin and Sinema for keeping them from getting an even worse beating. They probably aren’t intelligent enough to recognize that debt, but that doesn’t negate it.

They’re holding off legislation from the left-wing loonies, which can only help the party with centrists and independents.

whirlaway

2 years ago

Reply to ajc1970

The DONORcrats win elections by pretending to run to the left, and then lose it after their true right-wing colors come out when in power.

KidHorn

2 years ago

Reply to whirlaway

They pretend to care deeply about black people and then do nothing to help them after election day.

RonJ

2 years ago

Reply to KidHorn

Odd that black Americans keep voting for them.

threeblindmice

2 years ago

Reply to RonJ

Not that odd. Why would black people be uniquely immune from propaganda? Dems spin a yarn about police shootings and white supremacy. Many white people believe the same yarns. But don’t fret. Black voters are every so slowly shifting to R… as are Asians and Hispanics. The reaction to identity politics has already begun. Thankfully, the future lies in unity, not tribalism.

Dr_Novaxx

2 years ago

Reply to ajc1970

The electronic tabulating machines would have to be eliminated first. in 2020 they were connected to the internet intermittently as needed by the CCP to adjust vote counts and produce a “win” for Biden and the Georgia Senatorial run-offs. They are made in China and come with embedded modems on the motherboard that can be activated at will, externally.

Then, the elections commissions would have to follow the law set by State Legislators per the Constitution, not create new laws “on the fly.” The democrat party may actually come out ahead this year otherwise, regardless of politics.

Six000mileyear

2 years ago

Increasing corporate taxes will be passed through to employees as lower pay increases or none at all. A greater rift between corporate leadership and rank and file will grow larger.

whirlaway

2 years ago

Reply to Six000mileyear

” lower pay increases or none at all.”

IOW, the same thing that has been happening over the last 40+ years?

Siliconguy

2 years ago

Reply to whirlaway

Or, since inflation is running hot they can just raise prices and blame the inflation. Of course that increases inflation further, but as long as executive compensation increases faster than inflation that is quite acceptable.

threeblindmice

2 years ago

Reply to whirlaway

Productivity is increasingly concentrated in white collar jobs. White collars are also more likely to own equity. I’d like to see greater participation in productivity gains too, but we shouldn’t expect tax policy to fix a natural outcome of relative productivity gains. We need to raise the productivity of the lower half of the pop. The pay increases will take care of themselves, then. Corporations shouldn’t pay taxes at all. Only distributions (and gains) should be taxed.

whirlaway

2 years ago

Reply to threeblindmice

“Corporations shouldn’t pay taxes at all. “

Given the many loopholes that they have created, many of them are already there.

KidHorn

2 years ago

Reply to Six000mileyear

There may be cases where that’s true, but in general, I don’t think it will happen. Profits typically go to share holders. Not employees.

threeblindmice

2 years ago

Reply to KidHorn

Yes, wages go to employees and profits go to shareholders. That’s how employment and ownership work.

StukiMoi

2 years ago

Reply to Six000mileyear

“Increasing corporate taxes will be passed through to employees as lower pay increases or none at all.”

Which will then be used as an excuse for The Fed to claim what idiots-like-them believe is “inflation” is lower. So they can debase some more. Handing the taxes, and then some, right back to the “owners” who the Dumb Democrat Drones think their favorite Man-on-TeeVee is somehow “targeting” with higher taxes on those evil Corporations. Net result being, as always: Employees getting lower raises, in a currency worth less.

In a Fed State, redistribution is always and everywhere ultimately done via the printing press. Income taxes, activity taxes in general, while certainly distorting and inefficient, is ultimately irrelevant wrt wealth redistribution. Instead, such taxes are no more than a diversionary dog and pony show, to keep the economically illiterate indoctrinati that The Fed depends on robbing in order to keep the leeching classes in splendor, pliantly and cluelessly looking the other way.

The Amusing (to Republicans) Tag Team of Senators Manchin and Sinema

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