5-22-25 - 9am - No Tax on Tips & Overtime

Episode Transcript

Speaker 1 (00:00):
Did you see FBI the other day where they were
battling against terrorists that were created by the Education Department
being dismissed by Dogo funny things hard imitates life.

Speaker 2 (00:18):
I missed that, I guess.

Speaker 3 (00:23):
So I've now dissected for you what I hope gives
you a a detailed analysis of what's in the bill.
And I hesitate to use the word detailed, because man,
everything I did this morning was pretty much on the fly,
trying to read through the bill and whatever commentary I

(00:43):
could find about the bill from CBO or other sources, and.

Speaker 2 (00:50):
It and it is.

Speaker 3 (00:53):
I mean, I would say overall that if I were,
you know, if I were the Heighty Justice and I
was holding the scales, uh, it would probably tip against
the bill in terms of what it does overall for
what I think is probably the true existence. Well, we

(01:18):
have a lot of existential threats. We have foreign policy,
international existential threats, we have domestic existential threats, uh, illegal immigration, Marxism,
the useful idiots that that are are the Democrats. We've
got uh decaying infrastructure, We've got misplaced priorities, so we

(01:44):
we we've got a lot of things that are you know, oh,
and of course the our financial condition. So it would
when you think about those particular existential threat, this bill
to me just tips the scales further toward the demise

(02:06):
of the country. But that doesn't mean that there aren't
some good things in the bill, and everything that I'm
about to say, you can scream right back at me.
But the national debt. What about the national debt? If
if you're going to argue, if we're going to if

(02:27):
we're if we are not you just if we are
going to argue that the national debt going up ten
percent in a decade, If.

Speaker 2 (02:34):
The OBB the one big beautiful Bill.

Speaker 3 (02:39):
Is ultimately signed into law pretty much in the same
form that it is now, it gets through the Senate
and reaches Trump's desk, so it increases the national debt. Well,
if you're already morbidly obese, if Dragon was still at
his three hundred pounds, and if I was still well

(03:02):
over my two hundred pounds, and we decided, you know, hey,
when the program's over, let's go get some donuts. Or
if there was some donuts sitting out here and we
just decided to grab a few, Eh, we're over the hump. Anyway,
On the Bell curve of healthy, healthfulness, healthiness, where we're

(03:25):
on the other side of the Bell curve. We're kind
of that way with the debt. So warning me to
go on a diet and not eat those donuts so
that I go from you know, so that I don't
go from say, two hundred and fifty pounds to two
hundred and sixty pounds, is like, well, okay, I guess what.

(03:46):
I'm already living on borrowed time. But by the way,
I'm not that I'm not overweighting. Neither's dragon. So if
I set aside my idea logical conservatism, and I look
at the way I know things work in d C,

(04:08):
then I'm sure that Trump and for that matter, Speaker
Johnson realized that any progress made with legislation is also
relative and has to be gained despite some setbacks that
might incur when you're using the existing system. That we
have to pass legislation which involves compromise and involves people saying, look,

(04:34):
this is the hell I'm going to die on. Somebody
mentioned the text line make sure I give you credit
goven number twenty six fifty. While I can't appreciate the fight,
Congressman Massey puts up. I don't really think voting no
on every single piece of legislation is actually an effective
or helpful strategy. What do his no votes accomplished on

(04:56):
Republican legislation? Nothing in this case. Nothing. Now, in a
really tight case where you want to get something versus nothing,
then his always voting no can cost you gaining something.

(05:18):
It can cost you losing a couple of pounds simply
because he wanted to lose ten pounds and you were
willing to work your way toward ten pounds by losing
two pounds or four pounds or five pounds, he would
vote no and kill off the opportunity to ever get
to losing ten pounds. That's what his strategy does. Because

(05:39):
that's not being realistic or pragmatic, like I'm trying to
be right now, which is kind of hard for me
being pragmatic about the way Washington works. Now, why do
I have a hard time being pragmatic about the way
Washington works? Because I'm sick of the way Washington works.
Because I'm sick of the constant compromise. I'm sick of
us always pitulating to the Democrats. Now, obviously we didn't

(06:03):
capitulate to the Democrats here. But now we're having this
internescing intra party fight about how far we should go
with this stuff. Now, if we took out, if you
took all of the last three hours and you pulled
out each single topic, you would if you went back

(06:24):
and listened to every single topic, you would find me saying, well,
I think this is stupid, but I kind of agree
with this. I think this is dumb. I wish we
hadn't done this, but over here, I kind of agree
with this.

Speaker 2 (06:36):
It's it's.

Speaker 3 (06:42):
A to cob salad, a bunch of stuff thrown in there,
and I don't like all of it. They always put
blue cheese on a cobsalad ruins a cobsal, so I
have them take the blue cheese off, and they look
at me like, well, you're ordering at cob selling. Yeah, well,

(07:03):
I don't like blue cheese.

Speaker 2 (07:04):
Take it off.

Speaker 3 (07:07):
Critics of the OBBBBBBB should remember that this bill is
not the reason that we have the fiscal problem we
have or the massive national debt that we have. That's
been the behavior of reckless politicians from both parties for

(07:29):
the past seventy five years. Certainly in the twenty first century,
and they've made that national debt soar. You've seen the
graphs where it shows, you know, the national debt going
back to Eisenhower, and then it you know, keeps bumping out,

(07:49):
but it's a slow it's kind of a slow trend line.
And then we get we start getting to Nixon, and boy,
it just starts ballooning like crazy. And if the national
debt on the graft that you might be looking at,
if the debt is below the baseline, it's like a
giant iceberg that just gets bigger and bigger and bigger,

(08:13):
while revenues just don't I mean, they increase, but they
don't increase enough to cover that that's below the surface.
So if you want to be a problem solver this
side of the bill, the House of Representative side will
now have to work around the mess that will be.

Speaker 2 (08:37):
Over in the Senate side.

Speaker 3 (08:41):
So here are the main reasons the left and I
think the anti Trump uniparty hate the bill. It extends
the Trump tax cuts and win Speaker Johns by the way,
let me just say I apologize. Let me in sort
of footnote here, you have to give Mike Johnson credit

(09:06):
for getting this bill through because he had a very
thin margin. He had some definite no votes, he had
Chip Roy and other members in the Freedom Caucus, he
had the deficit hawks he had, I mean, he had
every possible special interest among congressmen that you could possibly imagine,

(09:30):
and yet he squeezed this through.

Speaker 2 (09:32):
And again I don't like it.

Speaker 3 (09:35):
I'll take it because if we can, if we can
show that we can actually govern, and then that's a
win for me. But it's a particular win for Mike Johnson.
I didn't think he could pull it off. I really
didn't expect to wake up this morning. I didn't expect
to have this bill done before Memorial Day, which was
his objective. That was his goal. And of course now

(09:57):
the goal is Trump's goal is to the bill done
and signed by July fourth, the two hundred and fiftieth anniversary.
So I'm not this year's next year, I think, but
he wants to get it done by July fourth. So
the reason that so anyway, in the footnote, you just
have to give Johnson credit that he was able to.

Speaker 2 (10:19):
Pull it off.

Speaker 3 (10:21):
He may not have the personality of a Nancy Pelosi
of cracking the whip, but somewhere behind the scenes, somebody
cracked the whip. Somebody made the compromises, and somebody got
it done. That's the end of the footnote back to
why the progressives, the Democrats, and the uniparty hate this bill,
and I think the number one reason is because of

(10:44):
the tax benefits. When they are when they meaning Republicans
argue that Democrats were actually voting for the largest tax
increase in the history of the country on all Americans.
That's a true statement. This bill shielded at least ninety
one percent of American taxpayers from a tax increase, and

(11:07):
it does set the stage for some small business growth
through the small business deductions. And Democrats always hate that stuff.
They hate small business. They love taxes because the more
they take out of your pocket, the more they can
control you. And of course they want insistencies is helping,
you know, Trump's rich buddies out. I forget some congressman

(11:31):
the other day. Oh it was Rocanna. It's on my
x feet if you want to see it. He's bitching about, Oh,
this is going to you know, reduce something for you know,
the average taxpayer by x and is going to increase
the average you know, tax deduction or lowering taxes for

(11:52):
the rich people by another number, which they were proportional.
And yes, for people who pay less taxes, the bill
to fit in raw dollar amounts is less than the
raw dollar amount for someone who's paying a larger amount
of taxes. But that's preying on the ignorance of people
that rich people generally don't have income. Oh, they have income,

(12:17):
but it's a different format. It's not wages and salaries,
it's dividends. It's capital gains, which is all taxed differently,
and you have a better you have a much easier
way of manipulating that. I can't manipulate my income here,
so I'm just I'm stuck, so I have to do
it over on the investment side of my of my

(12:38):
income streams. The no tax on tips pisses off Democrats
because if you, if you really want to know, in
my opinion, why Trump won Nevada no tax on tips,
Clark County a production not only Democrat county, the Clark County.

Speaker 2 (13:02):
Is Las Vegas is located.

Speaker 3 (13:06):
When Trump started talking about no tax on tips, when
you think about how prevalent the service industry is in
Las Vegas, I think that's why he was able to
sweep that County. The working class voters in the service
industries view that as a major win. Now, critics wine

(13:26):
is going to cost the federal government major tax revenues,
which is going to but they don't give a rats ass.
The current policy costs those same workers that rely on
two bucks an hour and customer generosity. It robs in
any sense of confidence that they'll ever be able to
make it financially. And whether you agree with no tax

(13:46):
on tips or not, and quite frankly, I don't actually
think it's a very good policy. Nonetheless, politically it was
a winner, an absolute winner. And of course the third
point I would make is that the Liberals, the Union Party,
the Marxists, the Democrats, but I repeat myself, they all

(14:07):
hate the border stuff, WAW money seven hundred and one
miles or whatever it's going to turn out to be.
Of a big beautiful wall, sixteen hundred miles of secondary barriers,
long rivers and pedestrian pathways and technology and everything else.
That's enough to make that's enough to make the left

(14:28):
go for their heads to explode. Getting illegal aliens off
welfare rolls. Why wait a minute, they opened the borders.
Whoever is running the White House opened the borders because
they wanted those numbers for reapportionment for congressional districts, and

(14:51):
to put them on the rolls because now you have
dependent voters that are more likely to vote Democrats than
they are Republican. You've just built up your voter base
by allowing all the illegals in and then putting them
on the welfare programs. So I would say that those
things are actually probably policy winners, particularly considering that what

(15:16):
it was fifty six sixty percent of Americans won all
illegals supported, not just the criminal illegal aliens. They want
all illegal aliens out of the country. And now that
Trump's incentivizing self deportation, which reminds me of a story
I actually wanted to do today. I'll get to in
a minute. This is what's really got them ticked off.

(15:42):
There's another one that is probably a little unrecognizable in
the bill. This bill in many ways actually gets away
from Biden's regulations and restrictions on federal lands, the whole
oil and gas leasing program. And despite my objection about
the phase out. If if I had if you put

(16:05):
a gun to my head and you said you have
a choice, you can either have a phase out of
all of these subsidies, or you can get all of
them right up front. But we're gonna blow your brains
out if we do that one. Okay, well, then give
me the phase out because I'd like to live to

(16:26):
fight another day.

Speaker 2 (16:29):
Now.

Speaker 3 (16:29):
I know some of you are thinking right now, Wow,
Brown's really talking out of both sides of his mouth. No,
I'm just telling you exactly how I feel and the reality.
This is the reality I talk about living in the
real world. This is the real world.

Speaker 2 (16:42):
About this bill.

Speaker 3 (16:45):
Now, here's what the bill may do, just some pure
in terms of pure retail politics. It sets us up
for futures. And by future I mean like soon smaller bill,
whether it be no taxes on Social Security, whether it
be further deregulation of other businesses, whether it be you know,

(17:08):
upending the entire administrating state, all of that stuff. Put
them in simple, single bills and do it before the midterms.
You might have a winning strategy.

Speaker 1 (17:26):
Why does the government put taxes on cigarettes because they
want you to smoke less? So why does the government
put taxes on your income because they want to control
these more?

Speaker 3 (17:40):
Somebody asked, which is a great question, And so let
me explain on the tax line, I mean both the
text lines. I misread it at first. It's kind of
a kind of not really a double negative fifteen seventy three,
writes Mike. Why don't you think no tax on tips
is a good pau Well, I think there are several

(18:03):
unintended consequences. First year, you're going to have increased tax
evasion in fraud because when you don't have taxes on tips,
individuals might misreport income as tips in order to avoid taxation.
If I can figure it out, I'm not going to
engage in this, but if I can figure out a
way to uh say that, you know, I'm on my

(18:25):
on my ten forty. Now I know it's almost impossible
to do because I get a W two. But if
there was some way on my ten forty to report, oh, well,
then you know, maybe I could do this. So I
get I obviously make I get speaking fees. When I
get a ten ninety nine, well I'll just classified as

(18:47):
a tip. So you pay me twenty five grand for
a speech, and uh, well there's twenty five there's twenty
five grand, no tax on it.

Speaker 2 (18:58):
So now.

Speaker 3 (19:01):
I think that's an extreme example, but I think it
could lead to people who particularly get that kind of
and I know if unaccountable is the right word, but
they get income that is, you know, kind of.

Speaker 2 (19:25):
Okay.

Speaker 3 (19:26):
So I have a contractor doing some work on the
outside of the house, and let's say his fee is
five thousand dollars and he wants me to pay him
twenty five hundred dollars in a check and getting twenty
five hundred dollars in cash, and he could claim that
because maybe he works part time in a Starbucks, he

(19:47):
made twenty five hundred dollars in tips, no tax on it.
I mean, I'm not that smart of a criminal to
figure out, but I think it can lead to a
lot of tax evasion and outright fraud, and then the
irs is gonna have a hard time. They have a
hard time. Now they're gonna have a hard time struggling
to verify what qualifies as a tip versus other income.

Speaker 2 (20:08):
And that's then going.

Speaker 3 (20:09):
To encourage underreporting or reclassification of wages. But there's a
second underttending there's actually three of them, there's gonna be
a revenue shortfall for public services. Tips represent a significant
income source in an industry like the hospitality industry, so
exempting them could reduce tax revenue potentially, you know, straining

(20:35):
funding for public services like infrastructure, social security, which obviously
disproportionately affects slow income workers who rely on those services.
You got inequity across professions. This is probably the one
that I think is one that bugs me the most.

(20:55):
Workers in non tip professions. You work in retail or manufacturer,
I don't care, pick any of them.

Speaker 2 (21:04):
You're going to continue paying income.

Speaker 3 (21:06):
You're going to continue paying taxes on all of your income,
which in my opinion, creates unfairness. So what's the difference
between somebody standing at a Dillard's, a Macy's, or Nordstrom's.
I don't care, and you're helping someone select a sport

(21:31):
code or address or a pair of shoes, and I mean,
you're providing a service and you're going to get paid
a commission or maybe not, maybe you're just getting straight
salary versus the person who brings you your taco and
you leave them a tip, And that doesn't get text

(21:55):
why the difference? The minute Trump announced no tax on tips,
I had a visceral reaction to it that was just
that's just not fair. It's income a tip is income.
So now you have exempted an entire class of income

(22:15):
that I can easily compare to other people in the
service industries. Why why why tax anybody in the service industries?
Why tax the person that's working in the shoe department
at Nordstrom's when he's sitting there, you know, with you know,
some woman who can't make make up her damn mind

(22:37):
about which pair of shoes, and so he's got you know,
fifty you've seen it, you've seen it in the shoe department.
He's got fifteen boxes of shoes out and she can't decide. Me.
He's working, working, working, trying to get you know, make
up her mind. Well, I think this one looks really
good on you. How's the fit?

Speaker 2 (22:53):
You know? Blah bl uh.

Speaker 3 (22:55):
That's a service. He gets paid an income. I would argue,
I'm providing a service now, Dragon is not providing any
services back there whatsoever.

Speaker 4 (23:06):
Not right now at least yeah, not well no, not.

Speaker 3 (23:09):
Right now, not most of the time. So there's just
an inequity across professions.

Speaker 2 (23:17):
But then there's this.

Speaker 3 (23:20):
An employer might actually lower the base wage expecting workers
to rely more on untaxed tips. So an employer could
shift compensation risk to the employees, and then that in
turn is going to exacerbate income instability in those industries

(23:41):
that rely on tips, especially when there's an economic downturn.
Let me think, what else you have a choice of
so tight labor market. You can go to work in
the Nordstrom's shoe department, everything else being equal, or you

(24:04):
could go to work at Perry Steakhouse. Well, you know
where the stakes are fairly expensive, so the tips are
going to be pretty big and you're not going to
be paying taxes on that. So now it makes it
more difficult for Nordstroms to hire a person to work
in the shoe department, because more people want to flock
to the service industry, because hey, if I work in

(24:28):
a place like Perry Steakhouse, and you know a table
of four has just now spent you know, five hundred
bucks or more, tip's going to be pretty damn good.

Speaker 2 (24:41):
And then, of.

Speaker 3 (24:41):
Course you always have the problem with businesses increasing prices
to offset lower tax revenue or to compensate for reduced
wage obligations, which are going to do what that's going
to increase the cost to the consumers.

Speaker 2 (24:57):
So while while no tax.

Speaker 3 (24:59):
On tips aims to boost take home pay for tipped workers.
All those consequences that I just mentioned could create broader
economic and social challenges, particularly if you don't pair with
robust enforcement and complementary reforms to make sure that that
stuff that I just mentioned doesn't happen. And I don't
like that either, because that means the IRS is going

(25:22):
to become even more intrusive about what's your income, what's
the source of that income.

Speaker 2 (25:29):
Oh, I just I just think it's a really stupid idea.
I don't give me. Don't get me wrong. I understand.

Speaker 3 (25:38):
If you work in the service industry and you're working
as a waiter or a waitress somewhere, or a bell hop,
or you're working in the concierg desk at a really
nice hotel and you rely a lot on tips, I
totally get it. I'm envious. And see I can't do

(25:59):
that here because you guys are such a holes that
if I told iHeart that I don't want a salary anymore,
I want to rely on the tips from the goobers,
I'd be broke tomorrow.

Speaker 4 (26:12):
You couldn't even get enough to buy the book.

Speaker 2 (26:15):
I got fifty six cents.

Speaker 4 (26:17):
I think.

Speaker 3 (26:21):
And imagine, imagine you and I relying on tips from
this audience.

Speaker 4 (26:25):
Well, you're screwed. I'd probably be okay.

Speaker 2 (26:29):
Well no, because we would have to have pooled tips.

Speaker 4 (26:32):
Oh never mind, we're both screwed.

Speaker 2 (26:34):
Yeah, see pooled tips. None of this.

Speaker 3 (26:38):
They tip you, you get to keep it. No, you're
part of a team here, bucco, and we're gonna pool
those tips.

Speaker 4 (26:44):
Basically, I got to tip out of the bus boy.
That's that's you.

Speaker 2 (26:50):
I don't care. Tell me whatever you want as long
as you pay me. I don't care. Just pay me.
Let's take a break early.

Speaker 4 (26:56):
Good for the guy that makes overtime.

Speaker 1 (26:59):
I like the idea, but overall I don't like it.
But I wonder does that mean my mployer won't have
to pay? Are your all taxes on that overtime either?

Speaker 4 (27:07):
So you said money?

Speaker 2 (27:08):
Just curious?

Speaker 3 (27:10):
Oh you know that's a great question. No tax on
If you just take the phrase no tax on overtime,
I assume that means, which I know is an assumption
that that only means income tax. You still have to

(27:32):
pay all you're withholding your fighting all of that. So hmm, Now,
if it is if it's no taxes, no withholding, nothing.
You just whatever your overtime is. You get that dollar
amount in a check or in a deposit, then screw

(27:54):
you because that means that you're making income and while
the rest of us are having to pay into these
entitlement programs, you're getting an exempt from it. See just
this is why we just need to get rid of
the income tax altogether. Straight consumption tax, which, by the way,

(28:17):
you know the guys at Discount Bath they sent me
an article yesterday. I've got to so my pos about
a congressman that's introduced a national sales tax.

Speaker 2 (28:27):
We'll talk about that.

Speaker 3 (28:29):
The very first story I wanted to talk about today
was from the Colorado Sun. Listen to this headline. After
crossing the border for better schools, some parents, including in Denver,
are pulling their kids and leaving the United States. That's
the headline subhead. Already, thousands of immigrants have notified federal

(28:53):
authorities they plan to self deport, according to the Department
of Homeland Security. President Donald Trump has encouraged more families
leave by stoking fears of imprisonment, ramping up government surveillance,
and offering people one thousand dollars in transportation out of
the country. The story goes on to describe this couple

(29:15):
who are from Venezuela, so they have temporary protected status,
which they no longer do, and they're moving back to Venezuela,
and some of I'm supposed to feel sorry for them,
at least that's what the Colorado Son's trying to get
me to do, and I refuse to feel sorry for
them now.

Speaker 2 (29:34):
One of the reasons they give.

Speaker 3 (29:36):
I feel sorry for them because they have been subjected
to these false, irresponsible stories about how there are you know,
ice agents in masks and hoods, kind of like the KKK.

Speaker 5 (29:52):
I guess it's funny, Michael, because when I read that headline,
I thought of that as well. But I thought of
another thing. It's like, Oh, are the Denver school's really
that bad that they need to leave our schools and
go back home to get a better education down there.

Speaker 4 (30:10):
That was the other side.

Speaker 5 (30:11):
I mean, there's probably very low likelihood on that, but
you know, it's just that's not that popped in my head.

Speaker 2 (30:18):
Well, but the fact.

Speaker 3 (30:19):
That that is a actually a fairly rational thought to
pop into somebody's head, it's freaking hilarious.

Speaker 5 (30:25):
Considering that what was it The fourth or fifth graders
read it like third grade. Yeah, the zero percent are
reading at grade level.

Speaker 3 (30:33):
And then the kid that they allowed to go back
to the school that was a convicted criminal and actually
was convicted. I think he was in trouble for a
gun charge and they.

Speaker 4 (30:40):
Let him back into something violent.

Speaker 3 (30:42):
Yeah, and they put him back into the school and
didn't tell anybody, And what do you do?

Speaker 2 (30:46):
He shot a couple of people.

Speaker 3 (30:47):
So so yeah, I think that I think it's a
reasonable thought to pop into your unreasonable head.

Speaker 4 (30:52):
It's too dangerous and bad here, let's go back home.

Speaker 3 (30:55):
Then the story, the actual story says, for the last
two much of their life in the U Jose al
Berthel Gonzalez and his family spent nearly all their time
in their one bedroom Denver apartment. They didn't speak to
anyone except their roommates, another family from Venezuela. They consoled
What's App messages for warnings of immigration agents in the
area before leaving for the rare landscaping job or to

(31:17):
buy groceries. But most days, at seven twenty am, Gonzalez's
wife took their children to school. They wanted the kids
to learn English, Well, should have come here legally. They've
been here for two years, and according to the story,
they planned to stay for ten years and then do what,

(31:38):
So you come to America illegally, Well, I shouldn't you
know why, I shouldn't even say illegally here because they're
from Venezuela. So assuming they came under the TPS program
under Biden, and yeah, they arrived two years ago, so
they did. They came under the Biden program. So I
can't even call them illegal aliens because they have temporary

(31:59):
protective state. I'm sure they figured they filled out at
the then CBP one app claimed asylum from you know,
Maduro and came to the US and now they're going
home terrified encountering immigration authorities. I would be too if

(32:19):
I were leaving, if I were living illegally in some
foreign country, I would be terrified of you know what,
I don't know it maybe a point where might be
terrified of being deported back to the United States. Who knows,
we keep going down the crapper, Yeah, maybe so, but
I would be more afraid of. Oh, in some countries,

(32:41):
you violate through immigration laws, you go to jail, and
then you get deported and the one thing I never
want to do is end up going to jail. Anyway,
Shame on you, Colorado's Son, but it points out that,
you know, Colorado has very few conservative news outlets and
the Colorado's Sun you ain't one of 'em.