Obama '08?

@okie,

Okay, good post. I'll respond to your paragraphs individually if that's ok.

okie wrote:

Cycloptichorn wrote:

I wonder if you understand that a lot of people don't trust the 'honesty' of Republicans and Conservatives when it comes to fiscal policy, because - while they talk a good game about fiscal conservatism - they proceed to get into office and spend money at an alarming rate WHILE cutting taxes and running the government in a sloppy fashion. It leads to problems like the ones we've been experiencing.

Cycloptichorn

That is one of the problems, cyclops, I will agree to that. However, Republicans are not alone in Washington when they are in office, and we also have many entitlements that cannot be reduced without a virtual knock down drag out in Washington, and politicians of any stripe know they would have a tough time getting re-elected if they tamper in any way with things like social security checks, etc.

Isn't that a sign then of what people WANT? Conservatives today defend both SS and Medicare heavily, despite the fact that they passionately fought against both on ideological grounds. They do so because people have clearly shown that they like and want these programs.

Isn't it the duty of the Representative to continue those programs, if their constituents clearly signal that they want them? It seems to be so, because those who wish to cut it don't stay in office all that long.

Quote:

I did criticize Bush for the No Child Left Behind and the Prescription Drug Plan, I think those were poor policies, although for the cost I was willing to see if NCLB would help the situtation. Even you should be able to admit that Republicanism and conservatism are far from being exact overlays.

Add the Bush tax cuts in there, because they were unfunded. When you are in a deficit situation and you cut taxes, you are basically just adding money on to the bill later. It isn't a fiscally conservative thing to do.

Quote:

Even with the best conservative and sound policies, we will not be able to balance the budget immediately, I believe, and it will take a concerted long term plan and we will have to stick to the plan of conservative policy in order to climb out of the hole that we are in. This will not be easy, because any cut in spending will be demagogued as unfair by the constituency groups that are affected, and when the main stream press joins the whining and adds to it distortions and sob stories, it makes the job very very difficult.

Well sure, but if your group's stuff got cut you'd be pissed too. That's how government works.

Do you not realize that raising taxes is a critical part of balancing the budget? I don't understand how you EVER plan on doing so without raising taxes.

Cycloptichorn

2 Replies

@Cycloptichorn,

Cycloptichorn wrote:

Yeah, I got that part; but then I was confused when you wrote:

Quote:
We agreed on something, which is nothing short of amazing.

Why were you confused? The statement was an attempt to have a sense of humor with Joe, but I guess you just don't have a sense of humor, cyclops. Your mistake is that you are reading more into what is being said, than is being said.

Quote:
Anyway; let's not argue over words, that's boring. Instead, let's play RJB's 'balance the budget' game. Can you show how you would balance the budget without raising taxes?

Cycloptichorn

Put simply, cut spending first, in little ways, and big ways. This will require a conservative president working with a predominantly conservative congress, and a press that would quit their demagoguery. I am pessimistic about it happening, but that is my solution beginning. It would take a top to bottom analysis of the entire budget, and I would not only look at line items, but I think that entire bureaucracies could be totally eliminated. That is the type of tough choices that we must make to solve this problem, as the problem has grown to be almost unmanageable at this point, because of the irresponsible governing of past administrations and congresses.

Also, we must also recognize as a country and as a people, that tax rates and tax revenues are not one and the same thing. We need to maximize tax revenues with the recognition of the reality that it takes a very healthy economy to deliver the revenues. If it takes targeted tax cuts in certain areas or overall, to maintain a healthy economy, then we should not rule those out. I agree though that tax cuts have to be considered as not always beneficial, it depends upon the situation we are in. To use an example, I believe instead of spending the simulus money to grow government and increase the deficit, we should have given a tax cut as a way of spending if necessary, and in the long run it might have delivered more jobs, more tax revenue, and a better road back to economic health. Alot of this is what we believe in, and I am not a believer in New Deal spending policies, I think that was shown to be largely a failure, and this similar policy by Obama is also a failure, so we need to go back to private sector solutions, that is what works.

2 Replies

@okie,

Quote:

To use an example, I believe instead of spending the simulus money to grow government and increase the deficit, we should have given a tax cut as a way of spending if necessary, and in the long run it might have delivered more jobs, more tax revenue, and a better road back to economic health.

Over 1/3rd of the Stimulus bill WAS tax cuts! How can you not know this?

Cycloptichorn

1 Reply

@Cycloptichorn,

Cycloptichorn wrote:

Isn't that a sign then of what people WANT?
Cycloptichorn

It is a problem that politicians can get elected by promising what people want, and people always want more. If this country goes down, it will not just be the politicians fault that spent more than we could afford, it would also be the peoples fault for demanding and electing those politicians. That is why I am a conservative, I do not vote for politicians that promise more and more of the government is going to take care of you. That is the president we have now, he wants to take care of everyone, and many people voted for him because of that.

In fact, I think much of the Democrats strategy with health care reform is that "lets ram it down the Republicans throats," and then after a few years, we will have created another vast number of Democrat voters because they will have learned to like the free health care, just like the people have gotten used to the social security and Medicare, never mind the fact that the programs are broke. The mindset is akin to some people in this country that insist upon buying anything they want on their charge cards, because the "want it" quote unquote, and the "need it" quote unquote, never mind how irresponsible it is and how it will come out in the long term. In other words, damn the torpedoes, full speed ahead, because we will do it cause it feels good and we can, and besides that, we can be a senator or congressmen for the rest of our lives by promising to spend somebody elses money to give to our voters.

All of the above helps explain why I am so opposed to Democrats.

0 Replies

@Cycloptichorn,

Cycloptichorn wrote:

Over 1/3rd of the Stimulus bill WAS tax cuts! How can you not know this?

Cycloptichorn

Not familiar with what the taxcuts were, or if they actually were, but I would favor taxcuts exclusively instead of wasteful government spending besides that.

1 Reply

@okie,

okie wrote:

Joe, I think your side is going to lose big next congressional elections.

My "side" always loses every election.

0 Replies

@Cycloptichorn,

Cyclops, would you please quit using the term "cutting taxes" when you are referring to "cutting tax rates," because they are obviously not always the same, and they are never the same in magnitude. Can you understand that 20% of 106 is more than 21% of 100? Can you understand that?

1 Reply

@okie,

okie wrote:

Cycloptichorn wrote:

Over 1/3rd of the Stimulus bill WAS tax cuts! How can you not know this?

Cycloptichorn

Not familiar with what the taxcuts were, or if they actually were, but I would favor taxcuts exclusively instead of wasteful government spending besides that.

Let me get this straight. You've been bitching about the Stim bill for over a year now - and you didn't even know that 1/3rd of it was tax cuts?

From Wikipedia:

Quote:

Tax cuts

Total: $288 billion
[edit] Tax cuts for individuals

Total: $237 billion

* $116 billion: New payroll tax credit of $400 per worker and $800 per couple in 2009 and 2010. Phaseout begins at $75,000 for individuals and $150,000 for joint filers.[27]
* $70 billion: Alternative minimum tax: a one year increase in AMT floor to $70,950 for joint filers for 2009.[27]
* $15 billion: Expansion of child tax credit: A $1,000 credit to more families (even those that do not make enough money to pay income taxes).
* $14 billion: Expanded college credit to provide a $2,500 expanded tax credit for college tuition and related expenses for 2009 and 2010. The credit is phased out for couples making more than $160,000.
* $6.6 billion: Homebuyer credit: $8,000 refundable credit for all homes bought between 1/1/2009 and 12/1/2009 and repayment provision repealed for homes purchased in 2009 and held more than three years. This only applies to first-time homebuyers.[39]
* $4.7 billion: Excluding from taxation the first $2,400 a person receives in unemployment compensation benefits in 2009.
* $4.7 billion: Expanded earned income tax credit to increase the earned income tax credit " which provides money to low income workers " for families with at least three children.
* $4.3 billion: Home energy credit to provide an expanded credit to homeowners who make their homes more energy-efficient in 2009 and 2010. Homeowners could recoup 30 percent of the cost up to $1,500 of numerous projects, such as installing energy-efficient windows, doors, furnaces and air conditioners.
* $1.7 billion: for deduction of sales tax from car purchases, not interest payments phased out for incomes above $250,000.

[edit] Tax cuts for companies

Total: $51 billion

* $15 billion: Allowing companies to use current losses to offset profits made in the previous five years, instead of two, making them eligible for tax refunds.
* $13 billion: to extend tax credits for renewable energy production (until 2014).
* $11 billion: Government contractors: Repeal a law that takes effect in 2012, requiring government agencies to withhold three percent of payments to contractors to help ensure they pay their tax bills. Repealing the law would cost $11 billion over 10 years, in part because the government could not earn interest by holding the money throughout the year.
* $7 billion: Repeal bank credit: Repeal a Treasury provision that allowed firms that buy money-losing banks to use more of the losses as tax credits to offset the profits of the merged banks for tax purposes. The change would increase taxes on the merged banks by $7 billion over 10 years.
* $5 billion: Bonus depreciation which extends a provision allowing businesses buying equipment such as computers to speed up its depreciation through 2009.

Cycloptichorn

1 Reply

@okie,

okie wrote:

Cyclops, would you please quit using the term "cutting taxes" when you are referring to "cutting tax rates," because they are obviously not always the same, and they are never the same in magnitude. Can you understand that 20% of 106 is more than 21% of 100? Can you understand that?

Of course I understand that; but the formulation that you are creating is a figment of your imagination. When you cut the tax rates you cut the amount of taxes collected. Cutting tax rates never leads to higher rates collected, ever. It just gives the economy a new, lower point for the rates collected to rise from - just like they always rise over time with a growing population.

We have been over this many, many times, Okie. You are forwarding a political viewpoint, not one which is supported by economists. Need I link to Conservative columnists and economists proving you wrong on this point? I'd be happy to.

Cycloptichorn

3 Replies

@Cycloptichorn,

Cycloptichorn wrote:

Let me get this straight. You've been bitching about the Stim bill for over a year now - and you didn't even know that 1/3rd of it was tax cuts?

Cycloptichorn

Okay, actually I was aware of some of that, but never looked at the details. Had relatives get the extra money as a social security recipient. But anyway, the vast majority of spending was spending, suchas adding another overlay to a highway for a mile or two, building a hiking trail, that sort of stuff all over the country. I just don't believe public works is the primary way to build a healthy economy, it is often not well spent, not targeted well, and after its spent, thats it, its over.

Short term vs long term also applies to tax policy as well. Sending a check to everybody in the country is a very short term policy, and after its spent, thats it. What we need is a sound long term taxing policy that business can count on and incorporate into their business plan, things that can gender long term business and economic health. Not just tax policy, but other policies that will build and create a more healthy economy. That is why I am intrigued with and tentatively support the National Retail Sales Tax, but only if and only if the income tax is totally eliminated. I believe adopting a better tax system as this would, would create one of the largest stretches of economic expansion and health in the history of the country. But it has to be done right, and I doubt there is enough political inertia in that direction for it to be done right. What I more expect is a sale tax tacked upon all the other taxes, and this would be further murder to the economy.

0 Replies

@okie,

Quote:

Put simply, cut spending first, in little ways, and big ways. This will require a conservative president working with a predominantly conservative congress, and a press that would quit their demagoguery.

As I already showed okie.
You could cut everything but military, veterans care, debt, SS and medicare and we would still have a deficit this year.

That means you could fire the entire bureaucracy.
Of course you have to remember that if you don't have an IRS, your tax revenues will drop 20-30% because without enforcement people will cheat. They cheat with enforcement.

1 Reply

@Cycloptichorn,

Cycloptichorn wrote:

We have been over this many, many times, Okie. You are forwarding a political viewpoint, not one which is supported by economists. Need I link to Conservative columnists and economists proving you wrong on this point? I'd be happy to.

Cycloptichorn

I have already provided proof of the opposite, more than once, as have others, but go ahead if you insist, be my guest, but common sense alone says otherwise.

2 Replies

@okie,

okie wrote:

Cycloptichorn wrote:

We have been over this many, many times, Okie. You are forwarding a political viewpoint, not one which is supported by economists. Need I link to Conservative columnists and economists proving you wrong on this point? I'd be happy to.

Cycloptichorn

I have already provided proof of the opposite, more than once, as have others, but go ahead if you insist, be my guest, but common sense alone says otherwise.

No, you haven't. Either you or Ican has tried to, but neither of you guys understand tax policy enough to properly analyze the situation.

http://www.factcheck.org/askfactcheck/have_tax_cuts_always_resulted_in_higher.html

http://www.cbpp.org/cms/?fa=view&id=507

Here, read this:

http://corner.nationalreview.com/post/?q=ZjI3OTQ5ZWJkNWI3YTIwMWRjN2Y4Zjk2N2YyZGFkYzU=

It's from the National Review, hardly some Liberal rag.

Quote:

Tuesday, October 16, 2007

"What's A Republican?" [Ramesh Ponnuru]

The New York Sun asks, and offers a list of unifying ideas. The top item on their list concerns taxes.

Reductions in top marginal tax rates provide incentives for growth and lead to greater government revenues in the long run. That is not always the case. There is a point on the Laffer Curve at which tax cuts on the top margin stop generating increased income, but we are nowhere near that point now.

Presumably what they mean is that the top income tax rate is higher than the revenue-maximizing rate, but I'm not sure why they think that it is. Bush's tax cuts appear to have caused revenue to be lower than it would otherwise have been, which suggests that we're already below the revenue-maximizing tax rate.

And the follow-up:

http://corner.nationalreview.com/post/?q=ZjI2NjhlMjBjZjAzMDk0N2EyNjE4ZjIxZmExMDg4NDk=

Quote:

Taxes and Revenues [Ramesh Ponnuru]

Yesterday I noted that Bush's tax cuts had caused revenue to be lower than it would otherwise have been. A number of people have emailed me saying that I'm wrong: Revenues have been growing fast, and are higher than they were before the tax cuts took effect.

That shows that the tax cuts were compatible with rising revenues, not that they caused them. The tax cuts may have boosted our economic growth, but we would have had some growth without them. So the question is whether tax cuts boosted growth so much that they ended up raising money.

I can't think of any serious economist who thinks that happened. The 2003 Economic Report of the President said that "[a]lthough the economy grows in response to tax reductions... it is unlikely to grow so much that lost tax revenue is completely recovered by the higher level of economic activity." Bush's own Treasury Department has disavowed the view that Bush's tax cuts have raised revenue.Rob Portman and Ed Lazear, while serving in the Bush administration (as head of the OMB and the Council of Economic Advisers, respectively), said that the tax cuts had reduced federal revenue.

I'll give the last word to Alan Viard, an economist who worked at the White House before joining AEI. Last year, the Washington Post quoted him: "Federal revenue is lower today than it would have been without the tax cuts. There's really no dispute among economists about that."

There is no argument amongst economists that your position is wrong, Okie. Not even Conservatives who work for AEI and Bush's administration. The only people who agree with your position are Conservative politicians, who don't understand economics very well.

Cycloptichorn

0 Replies

@okie,

Quote:

I have already provided proof of the opposite, more than once, as have others, but go ahead if you insist, be my guest, but common sense alone says otherwise.

No, you provided what anyone with your position provides. Incomplete facts skewed to support your opinion.

When adjusted for inflation and population, your argument fails miserably. The Clinton tax increases not only increased revenues more, they increased GDP more.

0 Replies

@parados,

parados wrote:

You could cut everything but military, veterans care, debt, SS and medicare and we would still have a deficit this year.

Why are you leaving out those items? Why do you think they are off the table?

0 Replies

Quote:

http://www.whitehouse.gov/omb/budget/fy2008/pdf/hist.pdf
Year…….$Receipts……$Outlays…$ReceiptsMinusOutlays
…
1980….517,112,000….590,941,000…..- 73,830,000 [CARTER 1977-1981]
1981….599,272,000….678,241,,000…..- 78,968,000 [REAGAN 1981-1989]
1982….617,766,000….745,743,000….- 127,977,000
1983….600,562,000….808,364,000….- 207,802,000
1984….666,486,000….851,853,000….- 185,367,000
1985….734,068,000….946,396,000….- 212,308,000
1986….769,215,000….990,441,000….- 221,227,000
1987….854,353,000….1,004,083,000….- 149,730,000
1988….909,303,000….1,064,481,000….- 155,178,000

Fed Receipts increased from $517,112,000 in 1980 to $854,353,000 in 1988, a 65.216% increase.

Quote:

ftp://ftp.bls.gov/pub/suppl/empsit.cpseea1.txt
Year................USA Civil Population......USA Total Civil Employed
...
1980...................... 167,745,000.................99,302,000 [CARTER 1977-1981]
1981...................... 170,130,000………….....100,397,000 [REAGAN 1981-1989]
1982..................... 172,271,000.................99,526,000
1983..................... 174,215,000...............100,834,000
1984..................... 176,383,000...............105,005,000
1985..................... 178,206,000………........107,150,000
1986..................... 180,587,000...............109,597,000
1987..................... 182,753,000...............112,440,000
1988..................... 184,613,000...............114,968,000

USA Civil Population increased from 167,745,000 in 1980 to 184,613,000 in 1988, a 10.0557% increase.

USA Total Civil Employed increased from 99,302,000 in 1980 to 114,968,000 in 1988, a 15.776% increase.

Quote:

http://inflationdata.com/inflation/Inflation_Rate/HistoricalInflation.aspx?dsInflation_currentPage=1
YEAR AVE
...
1980 13.58%
1981 10.35%
1982 6.16%
1983 3.22%
1984 4.30%
1985 3.55%
1986 1.91%
1987 3.66%
1988 4.08%

The yearly average inflation rate decreased from 13.58% in 1980 to 4.08% in 1988, a 30.044% decrease.

Quote:

http://www.freerepublic.com/focus/f-news/2051527/posts
Partial History of U.S. Federal Income Tax Rates
Highest and lowest Income Tax Rates 1971 to 2009
...
1971-1981: minimum = 14%; maximum = 70% [CARTER 1977-1981]
1982-1986: minimum = 11%; maximum = 50% [REAGAN 1981-1989]
1987-1987: minimum = 11%; maximum = 38.5%
1988-1990: minimum = 15%; maximum = 33% [BUSH41 1989-1993]

So why does anyone believe Reagan's increase in fed receipts is due to population/ job, and inflation changes instead of due to his tax rate cuts?

1 Reply

@Cycloptichorn,

Cycloptichorn wrote:

okie wrote:

Cyclops, would you please quit using the term "cutting taxes" when you are referring to "cutting tax rates," because they are obviously not always the same, and they are never the same in magnitude. Can you understand that 20% of 106 is more than 21% of 100? Can you understand that?

Of course I understand that; but the formulation that you are creating is a figment of your imagination. When you cut the tax rates you cut the amount of taxes collected. Cutting tax rates never leads to higher rates collected, ever. It just gives the economy a new, lower point for the rates collected to rise from - just like they always rise over time with a growing population.

We have been over this many, many times, Okie. You are forwarding a political viewpoint, not one which is supported by economists. Need I link to Conservative columnists and economists proving you wrong on this point? I'd be happy to.

Cycloptichorn

There you go again. You say you understand that, but then you go ahead and assert that cutting tax rates necesarily and always leads to lower amount of money collected, which is wrong and you know it. It does not always or necessarily one follow the other. Tax revenues are not and never will be a straight line equation of tax rates, because the economy is always either positively or negatively affected by tax rates. Now that is an absolute fact.

There are 2 factors in the tax revenue equation, tax rate and the economy on which it is applied, and tax rates affect the economy, that is an inescapable and absolute fact.

1 Reply

@Cycloptichorn,

I'm in Washington for some business meetings, and wondering If I'll be able to get back to California after the 24 inches of snow extd here starting Friday morning.

Cyclo,
We differ on two fundamental issues in interpreting events surrounding the recent draft Health Care legislation.

1. You appear to be asserting that you have proof positive, based on unspecified polls, that the American public strongly prefers the proposed House of Representatives version of health care legislation. I'm aware of polls suggesting a general public preferance for universal health care coverage by some means. However, I don't know of any that indicate a specific preference for that specific version of the legislation. It is one thing to wish for the magic resolution of a public problem: quite another to want a specific and concrete proposed "solution" with all its attendant side effects and costs. Indeed I have the strong impression that it was precisely the perception of public mistrust for that version and as well some expressed concerns about cost and feasibility that prompted the leading Democrat Senators to take a fundamentally different approach. That too is a poll of sorts and under our system of government it is the one that counts.

2. You appear also to assert that there was a somehow illicit Republican conspiracy to defeat the legislation and undermine any possibility of its passage. However, it is simply an observable fact that, with their strong majorities in both houses of Congress, the Democrate didn't need significant Republican support in passing the legislation, and weren't willing to make any major concessions to get it. Similarly it wasn't in the interests of Republicans to associate themselves with legislation which they could only influence in marginal areas. In short there was no conspiracy: Republican opposition was overt, deliberate and there for all to see.

I believe the essential cause of the failure of this legislation is traceable to the initial opposition of key Democrat Senators to the draft House legislation, apparently based on skepticism over the so called government option and the long range assumptions about the program's likely cost - skepticism that I believe was well-justified based on the track record of prior entitlement programs. Then growing public skepticism was also a likely contributor.

They ended up creating an overly complicated alternative that ultimately required several unsavory payoffs to key Democrat senarors to keep their votes. This too contributed to the growing public disenchantment with both the process and the legislative product. The Democrats had then, and have now, the votes to pass the legislation (though probably not to overcome a filibuster in the Senate). However, they are not even trying - a choice they have made all by themselves. I believe that is a clear indicator that they do not believe their product would be acceptable to the voting public. In short they were defeated by their own hubris and miscalculations - nothing else. In our Democracy, as I indicated above, these are the polls that count.

0 Replies

@ican711nm,

Quote:

Fed Receipts increased from $517,112,000 in 1980 to $854,353,000 in 1988, a 65.216% increase.

Fed receipts for 1980 adjusted to 1988 dollars. - $756,534,836
using deflators in US budget

Fed receipts for 1980 dollars using your numbers and NOT including 1980 inflation - $742,525,580

Fed receipts for 1980 dollars adjusted including 1980 inflation and using your numbers - $811,239,231

We haven't even adjusted for population increases yet ican and already we see the tax cuts barely made a $50,000,000 to 110,000,000 increase over 8 years. Simply adjusting for inflation shows we have at most a 15% increase in tax revenues over the 8 years. At worst a 5% increase.

This statement doesn't even make any sense ican.

Quote:

The yearly average inflation rate decreased from 13.58% in 1980 to 4.08% in 1988, a 30.044% decrease.

2 Replies

@Cycloptichorn,

Cycloptichorn wrote:

When you cut the tax rates you cut the amount of taxes collected. Cutting tax rates never leads to higher rates collected, ever. It just gives the economy a new, lower point for the rates collected to rise from - just like they always rise over time with a growing population.

We have been over this many, many times, Okie. You are forwarding a political viewpoint, not one which is supported by economists. Need I link to Conservative columnists and economists proving you wrong on this point? I'd be happy to.

Cycloptichorn

The assertion that curring tax rates NEVER leads to an increase in the dollar value of taxes collected is simply false. One can argue endlessly about specific cases - with & without adjustments for inflation or populatin growth , however the underlying principle that government taxation of businesses and individuals removes funds that would otherwise be spent or invested in the creation of new economic activity - is beyond doubt.

Much also depends on how one frames the argument. The issue here is not just about the welfare of the government brueaucracy, but also about the welfare of ordinary people who do the work and pay the taxes. Though an increase in tax rates may mean more revenue for the government it also means less for the folks paying the taxes. I don't think that anyone here is seriously arguing that government spending is a better leverage than that of the private sector in for the stimulation of new economic activity.

It is certainly true that the elimination of our national debt - if we are able to do it - will require both taxation and reduction in government spending. I believe the real issue here is what and how much in the way of taxes and spending reductions will actually be achieved. The recent "freeze" on government discretionary spending, coming as it does on the heels of recent major increases by the current administration gives me confidence only in the willingness of the administration to engage in cynical and deceptive but mostly illusory spending cuts, while continuing to lavish public money on their favored constituencies, and demanding higher taxes on others.

I see no willingness on the part of Democrats to address the entitlement programs that account for the major part of the forecast deficit. If their intent is to overcome that with new taxes then they will certainly end up crippling our economy - as we add taxes to a shrinking cohort of working people to support entitlements to a growing cohort of retirees and other entitlement beneficiaries. This was also a key issue in the recent debate over the failed health care legislation put forward by the Democrats. Sadly they and their supporters appear to prefer believing that their defeat was the result of an evil outside conspiracy, when in fact it was the obvious consequence of their own contradictions and hubris.

1 Reply

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