My mama, irreverent as always, would say: "Oughtn't that student be learning some sort of trade, instead?"
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Fuzzy thinking wasn't your fault. You been had. 
I am trying to put code of honesty and honor principles to work.

But you're not too mushy on most things. So -- allow me the temerity -- are academic standards & attitudes around this so generally ambiguous that it must be much sorted through?

To me (and I'm not in the system) the response had written itself long before this crime was done.  I would not have expected anything less when I was (as a student in the system).
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Maybe she just knew the material so well and the standard supporting pieces so thouroughly it just looked like plaigiarism.

I know I've been told that by a spanner before.
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Maybe she just knew the material so well and the standard supporting pieces so thouroughly it just looked like plaigiarism.

I know I've been told that by a spanner before.

He posted her peiece and what it was from. Word for word.
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ROFL
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"what part of" or "you're _____now".

Maybe she just knew the material so well and the standard supporting pieces so thouroughly it just looked like plaigiarism.

I know I've been told that by a spanner before.
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I knew you would bring that up. Given the animosity I've shown lately, I guess that's understandable.

I explained to you what the situation was. Rosa Luxemburg was part of a field exam I took.

In any case, the student has "confessed", anyway. And, those were not standard supporting pieces.
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I found it by Googling. Takes up to seven words in a row and I hit a jackpot. The rest of the paragraph was pretty close to verbatim as well.

I caught Eddie doing that all the time.  Googled anything of his that didn't start with "what part of" or "you're _____now".
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Hey, I only said I caught Eddie a few times.
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I Make joke. Self-deprecating humor. Ar ar.
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Where'd you copy that from?
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Nanu Nanu
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Mork
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HMMMMMMM.. Alf?

No? Shorter and hairier?
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Pushing poverty into 'moral-values' debate
Some religious leaders trying to broaden discussion beyond abortion and marriage
Don Lattin, Chronicle Religion Writer
Sunday, December 12, 2004

Kim Bobo has spent the last 30 years trying to get people of faith to see the connection between their Bibles and the federal budget, to see "moral value" in tax policies that would bridge the widening gulf between rich and poor.

Instead, she sees conservative Christian forces monopolizing the morality- in-politics debate around such issues as abortion rights and same-sex marriage.

Meanwhile, government statistics show, the rich get richer and the poor stay poor.

"Shame on us,'' said Bobo, executive director of the National Interfaith Committee for Worker Justice, a Chicago-based advocacy group. "Those of us who work with the religious community have not adequately made the connection between economic disparity and moral values."


In the aftermath of an election in which President Bush solidified his hold on white evangelical voters, Bobo and other left-leaning religious activists are struggling to broaden the "moral values" debate in American politics.

They hope to move beyond issues of sexual morality and put the spotlight on the administration's new domestic agenda to overhaul the tax code and privatize Social Security.

Earlier this year, the General Conference of the United Methodist Church, the nation's second-largest Protestant denomination, directed its regional offices to "prepare a strategy for action to promote and establish a just tax code in every state."

Last week, more than 100 church leaders from across the nation met at the Washington office of the National Council of Churches, where they vowed to put new emphasis on poverty issues.

"From a Christian perspective, we can't ignore our communal responsibilities to one another. From the Hebrew Scriptures on through, the Bible talks about how important it is that we care for the poor," said the Rev. Leslie Tune, a spokesman for that ecumenical organization. "We need to get our legislators and policymakers to understand that there's more to morality than who you have sex with and whether or not you have an abortion."
http://www.sfgate.com/cgi-bin/article.cgi?...MNGN9AAPGT1.DTL
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Yeah, I'd like to see the Catholic analysis of treating income from sources other than work (the sale of appreciated stock, loaning of liquidity, renting of land, housing and commercial real estate, estate proceeds, gifts) as worthy of preferential tax-treatment by the Federal government.
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Are you patient? Maybe we will not have to wait as long as Galileo did for a reprieve. 
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You folks will allow that people get a return on an investment that isn't guaranteed?
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Sorry I missed your point when you first made it. I suppose the argument for reduced capital-gains taxes are rooted in trickle-down economics. I'm not so sure a reduction in said taxes has done anything to benefit me.
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No kidding.

A good argument can be made for tax-subsidizing activities and uses of resources that have "positive externalities", i.e. situations where a relatively public or external "good" is produced without the entity whose activity or use produces it reaping any reward for it.
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Still, this doesn't apply to capital-gains (income from the sale of appreciated stock).

And how, pray tell, do you get an entity to  carry out an activity if it isn't going to reap any reward?
Remember, there is an opportunity cost to the investor and a investment benefit to society.
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Testimony of

Neil E. Harl

Charles F. Curtiss Distinguished Professor in Agriculture
and Professor of Economics

Iowa State University
Ames, Iowa

before the

Senate Committee on Agriculture, Nutrition, & Forestry
United States Senate

Washington, D.C.

February 26, 1997

Mr. Chairman, Members of the Committee, ladies and gentlemen. I am pleased to appear today before the Committee to provide commentary on several tax issues-(1) proposals to reduce the federal income tax rate on long-term capital gains; (2) proposals to amend the transfer tax system (federal estate tax and federal gift tax); (3) comments on deficit reduction; and (4) some concluding observations.

I. CAPITAL GAINS

The Tax Reform Act of 1986 eliminated the 60 percent exclusion for long term capital gains effective for taxable years after 1986. In 1990, the Congress restored a limited tax break for capital gains in the hands of higher income individuals by imposing a 28 percent maximum rate on long-term capital gains income.

Proposals pending in Congress would create varying degrees of preferential treatment for long-term capital gains. For several reasons, I believe that enlarging the preferential treatment for long-term capital gains would be a mistake. Such a move would be costly, would distort resource allocation and would perpetuate a major contributor to complexity of the Internal Revenue Code. Moreover, I am highly skeptical that such rate cuts would boost economic growth to the extent claimed by the proponents.

A. Complexity of tax law

Without a doubt, different treatment for long-term capital gains is the single biggest factor contributing to complexity of the Internal Revenue Code. The Code is shot through with provisions for limiting or targeting the benefits from the preferential treatment of long-term capital gains. And it s more than just the Code. A substantial body of regulations and rulings focuses upon distinctions among capital assets, assets used in the trade or business and inventory-type property. Moreover, many, many cases are litigated each year over those distinctions.

Many of us toiling as educators as well as practitioners agree with taxpayers that the system is incredibly complex and should be simplified. Certainly one good place to start would be to strip away all distinctions among classes of assets and treat all income as ordinary income.

The Tax Reform Act of 1986, which was touted as bringing simplicity into the tax system, hardly achieved that objective. Indeed, tax simplification has somehow managed to elude the Congress.

While I believe that one highly important objective of any tax system should be simplicity and I would like nothing better than to leave the next several generations a legacy of tax simplification, I have concluded with some reluctance that the largest and most complex economy in the world would probably not be well served with a simple tax. Yet we are all duty-bound to do all that we can to achieve the highest possible level of tax simplification, to streamline and make more efficient the revenue assessment and collection processes and to be the best possible stewards of the world's scarce resources.

B. Impact on the budget deficit

The evidence is compelling that further reduction in rates for long-term capital gains would be costly for the Treasury. The Joint Committee on Taxation estimates that the more extreme proposals could cost $33.1 billion over the next five years (1997-2002) and nearly $129.3 billion more the next ten years (1997-2007).

In my opinion, this would be a dangerous move. The first principle of any tax system is to generate the funding needed to pay for the services provided by government. It is the responsibility of the Congress and the President to take the long view and to keep fiscal considerations always in mind. If elected members of government fail to respect the "fisc," it is asking a great deal of taxpayers individually and collectively, voluntarily to forego consumption to support a common good.

It is my view now, and was my view then, that the tax cuts of 1981 were a monumental mistake. The Congress rushed to cut taxes in the hope that economic growth would be sufficient to offset the lost revenues. Of course, we all know that growth was not sufficient and the country experienced huge deficits and continues to do so as we speak, although the amount of the budget deficit has been narrowed substantially the past four years.

In September of 1981, I was quoted as saying that the tax cuts of 1981 "were the most irresponsible Congressional act of this century." In 1984, in testimony before the Joint Economic Committee, I indicated that I wanted to reconsider what I had said earlier. When asked how I felt at that point, I said that the tax cuts of 1981 were "the most irresponsible Congressional act in the history of the republic. As a matter of tax policy, nothing now ranks with restoring a sense of fiscal sanity to the economy of this country. A severely and chronically unbalanced budget is a matter of national security."

I would hope that we would remember the experiences of the past decade and a half and take the politically and economically responsible steps of first deciding what government services are to be provided and their cost and then deciding on the level of taxation. To do otherwise is to court disaster.

C. Effect on growth

The advocates of cuts in the tax rates for long-term capital gains argue that the lost revenue would be made up with higher levels of economic growth. Certainly reductions in capital gains rates would increase investment incentives. However, the evidence is less than compelling that the cuts in rates advocated would produce the kind of economic buoyancy projected. The effective rate of income tax on long-term capital gains is already low (some estimate the figure to be about seven percent). That is because taxes on long-term capital gains can be deferred, the gain on such assets is typically forgiven at death and, in any event, rates are capped at 28 percent for individuals. Moreover, a substantial part of capital gains accrue to tax-exempt investors for whom a tax cut would be worthless. In addition, about a third of investment is financed with debt capital rather than equity. Estimates indicate that reducing the maximum rate on long-term capital gains to 14 percent would likely reduce the cost of capital by only a modest amount.

It is well to remember that the economic growth rate in this country has been quite respectable in recent years without the cuts. It is also well to remember that the growth rate is heavily dependent upon policy of the Federal Reserve. Cutting tax rates (and thus increasing the deficit) is not a promising way to assure an easing of Fed policy.

Tax cuts have been viewed for a very long time as a way to spur the economy in times of economic downturn. To cut taxes at a time when the economy is growing and the Federal Reserve is dispensing monetary medicine to limit economic growth and contain inflationary pressures is questionable at best. To justify tax cuts on the grounds that economic growth will be spurred is hardly a new idea. But to do so when economic growth is already constrained by Fed policy is wrongheaded.

D. Tax shelters

One of the important features of tax policy over the past 30 years has been the gradual curbing of tax shelters. If investors could borrow and deduct the interest at rates up to 39.6 percent with the funds invested in assets that generate long-term capital gains which are then taxed at 14 percent, or even less, tax shelter activity would be encouraged. The result is a distortion in resource allocation.

Agriculture has been particularly susceptible to tax-motivated investment because of the availability of the cash method of accounting (even though inventories are a material income determining factor) and the biological nature of the sector as assets are created in the form of animals or crops. Those features have afforded opportunities for investors to deduct costs against other income and, in some instances, to sell the assets at reduced tax rates. Tax shelter activity in the agricultural sector reached a peak in the late 1960s with substantial amounts of investment capital flowing into feedyard activity, much of which was in the Southwest; cow-calf and dairy herds; and tree crops. The extremely generous depreciation allowances, the tax advantages of leasing arrangements and the higher level of investment tax credit in the 1981 tax act also influenced investment activity.

The campaign to curb tax shelter investments began with the imposition of depreciation recapture in 1962 and 1964 and continued with the Tax Reform Act of 1969 which implemented new hobby loss rules; legislation enacted in 1976 which added rules limiting the tax advantages enjoyed by "farming syndicates;" statutory enactments in the early 1980s which imposed "at risk" rules; and the Tax Reform Act of 1986 which contributed additional limits on the deductibility of prepaid expenses, the far-reaching rules on deducting passive losses and the repeal of the 60 percent long term capital gains exclusion.

Most agree that tax breaks or inducements affect investor behavior in encouraging investment to be targeted to areas of greatest tax advantage, thus distorting economic activity. Agriculture has been particularly impacted in a negative manner by tax shelter activity because of inelastic demand for most farm commodities. With inelastic demand, increases in supply are rewarded with a disproportionate drop in price and in profitability. Since 1986, the level of tax induced investment in agriculture has been at the lowest level in modern time.

The various proposals for rate cuts for long-term capital gains should be evaluated in part on the basis of whether the provisions would return the tax system to a higher level of tax shelter activity. It is my belief that lower tax rates for long-term capital gains would have that result.

E. Assets used in the business

The same preferential treatment for long-term capital gains would be available for assets used in the business under the proposals. An example, for which we have some experience, is animals held for draft, dairy and breeding purposes. While this move would be greeted warmly by taxpayers viewing the situation on a micro basis, the result would almost certainly be increased investment in assets eligible for such treatment. Moreover, we know from observing tax behavior in the years before 1987 that taxpayers would be inclined to maximize the benefits of the provision by selling sows, for example, after meeting the holding period requirement (12 months) even though economic and management considerations would suggest keeping sows for more litters.

The greatest impact, however, would be to induce more investment in eligible assets, thus driving up the supply. Taxpayers do respond to economic signals. An example of this occurred in 1978 when farmers lobbied for and obtained an extension of the investment tax credit to single purpose agricultural structures (confinement livestock facilities). It was later conceded, even by the most ardent proponents of the move, that it was an economic mistake for farmers. The outcome was that more facilities were built (the price dropped to 90 percent of cost as the U.S. Government picked up the cost for the other 10 percent) and, once built, were generally kept filled with hogs. Not solely for this reason, but undoubtedly affected thereby, more than half of the months from 1981 to 1985 were loss months in hog production.

Preferential treatment for capital assets and assets used in the business distorts resource allocation.

F. Land

A major argument for restoring a capital gains tax break is to encourage older individuals to sell their assets. It is true that an historically disproportionate amount of farmland ownership, for example, now rests with older landowners.

One of the legacies of the farm debt crisis of the 1980s has been an increase in concentration of land ownership by older individuals. In 1992, half of Iowa farmland owned by noncorporate owners was owned by individuals 61 years of age or older. This is compared with half of Iowa farmland owned by individuals age 56 and older in 1992.

The 1992 study showed that 49.3 percent of the landowners anticipate disposing of their land by will, another 14.4 percent plan to put their land in trust and only 17.3 percent expect to sell their land. However, implementing a lower income tax rate for long-term capital gains is unlikely to "unlock" assets. So long as a new income tax basis is obtained by retaining land ownership until death, many individuals are unlikely to change their plans even if the effective maximum rate of 28 percent drops to 14 percent or even lower.

Moreover, the"lock in" effect is probably substantially overstated for other taxpayers. The lock-in effect is the most serious when a shift to a more productive use of the resource is blocked. It is difficult to make a compelling case on that basis for corporate stock or, for that matter, for much of the investment in land. Assets tend to gravitate into their highest and best use because of basic economic pressures in any event.

G. Equity considerations

The distributional impact of a cut in the income tax rates on long-term capital gains would be substantial. Much of the benefit would accrue to households in the top five percent of the income distribution.

H. Long-term considerations

Fundamentally, an important question for this Committee is whether the economic health of the country is likely to be enhanced with tax breaks related to real capital assets. Certainly that has been the traditional approach to spurring economic activity in times of recession.

But a good case can be made that the competitive position of the United States in the next half century will relate more to the productivity of its human capital than to productivity of its capital base in the form of real assets. It is my view that the focus as we move forward into the twenty-first century should be on encouraging a higher level of development of human resources at all levels and in encouraging the development of a climate for innovation and entrepreneurship rather than persisting with what I consider to be an outmoded concept of providing breaks for capital investment in real assets. Focusing attention on tax breaks for capital assets is an idea whose time has passed.

I meant, "any private reward for the public (non-private) good that the activity produces".
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I didn't want to be too sticky about the convoluted style of your response. We've been there too many times. You need to make your thinking more obvious through your writing. I can't take the time to answer every possibility of "what you meant". Economics is about logic, not needless obscurity and complexity. Especially in the communication.
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This worksheet has been developed to help you to understand the issues connected with positive externalities. It uses a number of sources of data and information which are available on the Internet. To answer the questions follow the highlighted links (or the Internet address given in brackets) to access the information you will need to complete this worksheet.

Aims:
To be able to

understand, and distinguish between, private, external and social benefits.
identify examples of positive externalities in the real world.
evaluate the efficiency of the market mechanism in the provision of health care.
analyse possible approaches to dealing with market failures in health care.

Well said. Lamentably, I wasn't trying to be obscure and complex.

.
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Exactly why it hurt me to reply as I did. ( I really don't like to be critical just for laughs) But you bounced from from one point to another. I understand there are some parallels between capital gains and investment in human capital, but it's hard to intertwine them so much and make a cogent point. 

Corps invest in people knowing that much of their training money  is wasted, and the next employer is likely to have to retrain people anyway. Not sure how much benefit to society is in specific training by employers as compared to generalized training  by public and private schools. My bet is it takes a very complex equation to truly figure out the right balance for any specific job.
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A Journalist's Guide to Economic Terms
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Are you in favor of treating income from all sources as ordinary income for federal income tax purposes?
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We've discussed positive externalities before, but merely dropping the term into a discussion of capital gains doesn't make them all important in the discussion. It would be a lot easier to discuss wide ranging economic strategies without a lot of subordinate clauses containing economic jargon dropped in the middle.
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I only brought them up as something that it sort of makes sense to treat favorably in tax terms.

Let me try it, again.

It's not good for anyone except those who live off capital gains, interest, dividends and rents to have the government treat those sources of income more favorably,  in income tax terms, than income from work.
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Investment is a good thing, especially in a world where people can take their money and invest(or move) elsewhere. I know it sucks to tax hard workers, but then it sucks to have investors quit investing. I'm for widening the investor class, especially to the lower classes. Not for removing incentives for people to invest here.
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Aren't you presuming that tax benefits are the main incentive here? That's way too presumptive, and wrongly so, more often than not, I'd guess. If tax benefits are the main incentive, then the social-good externalities better be big.

I don't think it takes a rocket surgeon to figure out that investors invest to make money, not primarily for the tax gains. Tax disincentive should be regarded the same as tax incentive -- not a good simply on its face.

It takes even less of a rocket surgeon, in my estimation, to figure out that the favorable tax laws have been written by the elected class to benefit the donor class.
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It takes even less of a rocket surgeon, in my estimation, to figure out that the favorable tax laws have been written by the elected class to benefit the donor class.
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I suppose, but then taxing my boss out of the hiring business only SEEMS like a good idea if I only consider his loss and not mine.

This is a basic argument I've had with every C-Span lefty going back to Grig and Celt. I have no desire to reward OR punish rich folks. I DO have a basic interest in a booming economy as opposed to flush government coffers.
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It's a stange idea that one should punish oneself to prevent someone else from getting rich.   
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I suppose, but then taxing my boss out of the hiring business only SEEMS like a good idea if I only consider his loss and not mine.

This is a basic argument I've had with every C-Span lefty going back to Grig and Celt. I have no desire to reward OR punish rich folks. I DO have a basic interest in a booming economy as opposed to flush government coffers.
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I fear the motivation of too many socialists isn't to make poor people rich, but to make rich people poor. A view with unintended consequences galore when put into practice.
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