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From: simard@loral.UUCP (Ray Simard)
Newsgroups: net.flame
Subject: Re: Corporate Taxes
Message-ID: <545@loral.UUCP>
Date: Fri, 12-Oct-84 16:15:04 EDT
Article-I.D.: loral.545
Posted: Fri Oct 12 16:15:04 1984
Date-Received: Sun, 14-Oct-84 07:10:47 EDT
References: <947@trwrba.UUCP> <2274@sdcc3.UUCP> <>
Reply-To: simard@loral.UUCP (Ray Simard)
Organization: Loral Instrumentation, San Diego, CA
Lines: 70
Summary: 

[]
>     If corporations were able to recoup the entire effect of  tax  hikes
>     by raising prices, they would have no aversion to tax hikes -- which
>     manifestly isn't the case.


     The point of the discussion is that the ultimate source of corporate  tax
revenue  is  the  customers  of  that corporation. True in an "all else equal"
scenario, a corporation cannot merely tack on a dollar-for-dollar increase  in
the  prices  of  its  goods  without impacting sales (that's simple supply and
demand). However, who bears the burden of that loss? The customers have to pay
more  for  the  product, the stockholders lose dividends and appreciation, and
jobs are lost for employees of the corporation due  to  reduced  volume.  (And
lest  we  get into blathering about those "rich stockholders who can afford to
lose a little", let's recall that the largest investors are institutions  such
as  mutual  funds,  etc, who manage such things as retirement plans, insurance
benefits, and similar - all which help the bulk of working Americans).


>     ...fewer profits are hence channelled from the pockets of the consu-
>     mer  into  those of the people (not, fascist calumny to the contrary
>     notwithstanding, average people) who own the corporations.

     Just who do YOU think owns the corporations? I know the image of  wealthy
snobs  ("Well,  deah,  don't you think it's simply DREADFUL how we have to pay
taxes like the lower classes? I was hoping for another  Mercedes  this  year")
owning  the  bulk of equity in business is very dear, but it is also false. Do
you follow the stock market or read business publications?   If  you  do,  you
will find the real drivers are INSTITUTIONS - which handle mostly the kinds of
things I mentioned before. Did you know the AVERAGE stock  portfolio  is  less
than $10,000? That is the price of a midsize car these days.


>     Some of it (the profit) is thus channelled into government.

     ...and channeled out of MY pocket. I fail to appreciate that, beyond  the
extent  that I can see that money going to benefit the security and prosperity
of the general citizenry.

>     government, so that much of the taxes which might otherwise be spent
>     in  a manner beneficial to the public go right back into the coffers
>     of defense contractors.


     I love this. Business owns and operates the  government.  That's  why  we
have  the  most ridiculous tax ever imagined, the so-called "windfall-profits"
tax. I'm sure the oil industry lobbied long and hard to get that  one  passed.
We also have not eliminated the corporate income tax. I suppose that's another
example of government in business's pocket.

     By the way, I deplore $7000 coffeepots as much as anyone. But these  hor-
ror  stories  are  examples  of  just  why I want to reduce government and its
spending. This can happen because nobody is accountable. Someone gets a  blank
check  and  in  typical  bureaucratic manner, loses all sense of where it came
from. The more of what my labors earn I get to keep, the more of that wealth I
will spend in a responsible, accountable manner.


>     Ain't life wonderful?


     To the extent that you choose it to  be,  although  that's  getting  into
net.philosophy.
-- 
[     I am not a stranger, but a friend you haven't met yet     ]

Ray Simard
Loral Instrumentation, San Diego
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