[speaker001:] well do you think we're paying too much in taxes right now
[speaker002:] well frankly I think we're paying too little I think we have paid too little since Reagan and them decided to cut it uh I used to get these uh surveys from the Republican Party from time to time asking if I thought it was a good idea for them to cut taxes and I kept saying no I felt like what we ought to do is cut spending and keep taxes the way they were well granted maybe the only way they could keep the spending to be uh that is curtail the spending and cut it was to cut taxes forcing spending to have to be cut but uh I always felt like the Congress uh just ought to shoulder responsibilities of biting the bullet uh that they uh uh are are supposed to be able to uh you know handle shoulder
[speaker001:] yeah
[speaker002:] and uh cut their spending and if they had uh done that without cutting taxes we wouldn't find ourselves in economic quagmire we're in now
[speaker001:] yeah well I think too many people are not paying enough taxes some are paying too much uh the the middle class but the uh upper class the wealthy people are not paying enough
[speaker002:] uh-huh
[speaker001:] I think the legislation that there ought to be legislation that make makes it more equitable for uh depending on how much you earn
[speaker002:] are you so you like the progressive income tax
[speaker001:] yeah I sure do uh-huh I we think everybody ought to be paying their fair share there still too many loopholes available to to get by with
[speaker002:] well well I I thought they had closed most of the uh loopholes when they came out with this uh pretty well constant fixed tax type uh about the only well I know there are a few you're right about that but primarily the only thing that was supposed to be any longer tax deductible was your your first and second home mortgages the interest that is
[speaker001:] yeah right
[speaker002:] and that was about it now I think there are still some real estate oriented type tax hedges
[speaker001:] they cut it back on rental property income
[speaker002:] yeah
[speaker001:] that uh you can't uh get uh tax deductions on uh say a second third fourth house that you own on paying uh taxes on on that
[speaker002:] yeah well that's where the rich see uh certainly have a second third fourth and fifth house
[speaker001:] right and they also cut back on things like limited partnerships
[speaker002:] right uh in what way what loopholes then are are left that you're talking about
[speaker001:] well the maximum tax bracket is twenty eight percent
[speaker002:] right well thirty three if you're in that hump but
[speaker001:] so nobody can pay any higher than right
[speaker002:] yeah but uh uh uh I I felt like they ought to cut the capital gains tax
[speaker001:] I think that's right too I agree with that
[speaker002:] because it it for for once finally with taxes having been cut it makes the little investor like myself capable if you're able to set aside a little money aside to do a little investing and make a few bucks without getting it all taken away from you
[speaker001:] sure
[speaker002:] and you ought to get your salary taxed once and if you're able to save some money to be able to invest in stocks and bonds and various things like that then to get it stuck to you again seems just a little bit unfair
[speaker001:] right I'm saying the way our taxes are structured right now it does not encourage saving
[speaker002:] no it really doesn't but on the other hand how how um how would we change it to encourage saving
[speaker001:] um well that that's a good question
[speaker002:] and go back to things like tax free IRAs and like that they wound up coming back
[speaker001:] yeah I agree with that that that's I uh
[speaker002:] okay yeah I thought that was a good move too that certainly in
[speaker001:] yeah I think I wish we would do that I'm in a bracket right now where I cannot take advantage of an IRA getting a tax deduction on it
[speaker002:] I hear you
[speaker001:] I used to be able to do that but uh I can't now and so then there's also the problem now where I've got some contributions that were tax deductible and some that aren't and I have to keep those separate
[speaker002:] yeah and now that right yeah and that's absolutely unfair I agree and it seems like every time Congress and and and uh the presidency gets a set up like the had now see that's the kind of tax cuts I'm for not necessarily just a a broad range tax cut on salaries so much but tax cuts where they don't tax savings of various kinds you know savings where you're willing to tie your money up at least some minimum period of time some some uh minimum number of years and all like like IRAs were uh it it that that those are reasonable alternatives that the average person can get in on and not just the rich alone
[speaker001:] yeah
[speaker002:] but uh uh seems like every time that uh people begin to make a little money at that and a lot of people jumped on IRAs I mean you did you apparently you apparently did and a lot of people I know did too
[speaker001:] oh I still do contribute to an IRA even though I can't take advantage of any tax breaks
[speaker002:] yeah yeah well I'm in one too but it seems like as soon as they uh got to going like gangbusters and the Congress saw that big pile of money beginning to form out there they wanted to come in and tax it again
[speaker001:] sure
[speaker002:] and and uh that that's only again because they would not uh uh police themselves and their spending
[speaker001:] uh-huh
[speaker002:] and I I don't know I I don't know what else to do about it I mean seems like we are are are constantly reelecting Republican presidents and Democratic Congresses or Democratic presidents and Republican Congresses and they can't ever seem to get together
[speaker001:] yeah well I think one of the things that may maybe does encourage encourage uh saving in a small way is that you can't write off taxes on personal spending uh that may keep a again that may cause a recession as well though because it keeps people from going going out and charging their credit cards uh to the max
[speaker002:] right
[speaker001:] and it cuts down on uh how much uh spending were their going to uh do for the year
[speaker002:] do you think this latest interest cut rate cut that the Fed just went through is going to uh get people back on the spending
[speaker001:] I'm not so sure about that uh we're still uh in a recession as such and uh it that tax that cut in the in the the prime has not encouraged activity in the market yet
[speaker002:] yeah uh-huh uh-huh
[speaker001:] I think people are going to follow the stock market if if it takes off uh that's a good indicator that the economy is turning around and people are going to start spending again right now a lot of people are fearful about their jobs
[speaker002:] well oh yeah I know exactly how you feel
[speaker001:] there are a lot of layoffs uh you know unemployment's way up and uh they're just saving money uh until things get better
[speaker002:] right uh-huh uh-huh I uh was talking to a fellow today and he seemed to think it was going to make a difference but I said hey if a lot of people are all ready borrowed up to the hilt I don't care how cut low you cut taxes they can't afford to borrow anymore or they won't just because they want to try to get a handle on what they have that you you've got to cut them drastically such that the uh idea of refinancing at a lower interest rate becomes the thing to do
[speaker001:] right well you can do that with say a mortgage payment but they charge so many points in order to refinance a lot of people can't afford that
[speaker002:] yeah and that's right or or less the break is considerable between the the interest rates and the cut between say eleven percent mortgage down to no more than nine percent mortgage that's not enough you've got to get down to eight maybe even seven and a half
[speaker001:] yeah well that's basically what we're doing right now is uh people a lot of people have eleven percent mortgages and they can get nine percent now but it costs them three points to do that
[speaker002:] yeah and that's not enough you need a eight percent loan to be able to do that
[speaker001:] three percent of yeah three percent of their mortgage mortgage right now or or of the uh principal that's left on their loan is uh a significant chunk of change
[speaker002:] that's right
[speaker001:] and uh a lot of people aren't aren't in a position to take advantage of that
[speaker002:] so I I I'm not so sure myself that uh that cutting interest rates is going to do it or cutting taxes either I just think we've gotten ourselves so uh gone through such a uh uh period of time where we've been so credit hungry and um we have gotten uh u h so out on a limb in debt not only uh federal debt but consumer debt too that uh I'm really concerned whether any kind of taxation one way or the other is going to make a difference
[speaker001:] yeah well another thing that uh kind of irks me right now is I just got my tax appraisal on my house and it went up ten thousand dollars from last year
[speaker002:] uh uh-huh well you know that's what's happened to me I got my appraisal well we get them up here they give them to you three years out
[speaker001:] there's uh-huh
[speaker002:] I mean you you get one every year but it it it puts in at a what they expect it to be for the next three years you know based on what it is right now subject to change of course
[speaker001:] right
[speaker002:] and uh real estate values up here in in the uh uh uh eastern corridor have dropped about two and a half to five percent
[speaker001:] real estate values here have dropped at least ten percent over the past uh two years
[speaker002:] okay well see the pressure's is more up here so it hasn't dropped quite as bad because the population being what it is but nevertheless it's dropped
[speaker001:] right
[speaker002:] but uh this hasn't been reflected in my appraisals and I was just telling my wife the other night you know I says I I wonder who it is you talk to here in the state about about protesting this because if and only uh interest rates I'm sorry uh property values don't come back up which means I can see that I can uh get again at least what I could have gotten for my house a year ago then I'm not being fairly appraised
[speaker001:] right there's no justification here for an increase in uh the value of a home the property values are still going down and I'm not sure they've hit the bottom yet
[speaker002:] um in the Texas area
[speaker001:] so uh when when they yes when they all of a sudden increase with all the layoffs and what not uh real estate prices have not been going up
[speaker002:] uh-huh ha
[speaker001:] uh there's too many too many homes on the market right now too many people are just bailing out on their homes and leaving them their abandoning abandoning their homes
[speaker002:] uh-huh is a lot of that going on
[speaker001:] oh yes there's two homes on my street right now that sure
[speaker002:] um that's going to put the banks in dire straights because the banks don't want the property they want the money
[speaker001:] that's right there are a lot of banks that are in trouble we've had banks that have been closing for the past two years in Texas we've got a record number of banks that have been gone all ready gone under
[speaker002:] yeah well do you see where the tax situation could really help that any
[speaker001:] uh no I don't I think that's mostly with the economy and the job market
[speaker002:] uh-huh
[speaker001:] but I think it's unfair that uh the tax appraisal has gone up this year when in fact the uh the value of the homes has not
[speaker002:] oh I do too yeah yeah I think it's absolutely unfair but they've gotten into this mentality and uh I don't think they know how to appraise a house down
[speaker001:] yeah I don't know how what they use to justify that uh because say I've got the same model home as some of my neighbors and they're all appraised at the same level
[speaker002:] yeah yeah
[speaker001:] even though I've made more improvements on my house than somebody else has and nobody comes out to take a look and see what you've done to get a proper appraisal
[speaker002:] now out here they do they take pictures of house and everything and what they do is they look at what your particular model at least three of them have sold for within the last twelve months or later if if they have the data they don't always have that much data because they may not have sold that many of your model
[speaker001:] okay uh-huh
[speaker002:] but here they could for instance I I've had to they do it randomly more or less but they try to get three at a time over a twelve month period because uh one of the houses I sold I'm in my third house now I uh my second house I actually had an appraiser come out and take pictures of it uh that he had to go