2012 Presidential Election - The Day after the Aftermath...

[FlagDUDE08]

Re: 2012 Presidential Election - The Day after the Aftermath...

Of course revenues rose. Inflation + using 2001 as your base year will make any policy change look amazing. The tax cuts even were good policy as a short term stimulus. But they are not some magic golden egg providing long term growth for federal revenues. Unless you believe we're to the right of the apex of the laffer curve despite plenty of evidence that we are not, then lowering tax rates will not raise revenue.

If they don't provide long term growth, than why did the deficit by year go down from 2004-2007? The site even adjusts for inflation. http://www.davemanuel.com/history-of-deficits-and-surpluses-in-the-united-states.php

The logic is backwards. If you want a short term stimulus of money for the government, you raise taxes. Less than 1 year isn't long enough for a company to change its fiscal proceedings, especially if you back-door it at the last second (Congress is good at both, regardless of party). I think we can both agree that in the mid-2000's, spending didn't decrease all that much, especially considering there was a new surge involved in there. By the law of disjunctive inference, that means income increased. In case you're still convinced that that's short-term, let's take a look at 2003-2004 where deficit by year increased. This is your short term example. Remember that including a general rate decrease, you also saw special rules regarding long-term investments. By the 1040 definition, long-term begins at one year + one day. Of course in the first year, you're going to not see as much income coming in, because people are getting set up. This is also why Taxmageddon will create a revenue increase in the short term, because people are cashing out on that setup I just described.

 

[burd]

Re: 2012 Presidential Election - The Day after the Aftermath...

coupled with faulty truck stop condoms, in at least a couple of instances.

Not faulty in all respects. The ones that are advertised to whistle while they work do in fact whistle. Do they stop the little wiggleys? Probably not always, as you say.

 

[unofan]

If they don't provide long term growth, than why did the deficit by year go down from 2004-2007? The site even adjusts for inflation. http://www.davemanuel.com/history-of-deficits-and-surpluses-in-the-united-states.php

The logic is backwards. If you want a short term stimulus of money for the government, you raise taxes.

You don't stimulate government revenue, you stimulate the economy. You shouldn't care about government revenue on a yearly basis, you care about the trend and underlying causes for any structural issues.

As far as the growth from 04-07, imagine what it wouldve been without the tax cuts. We might have even balanced the budget by then. Of course, ive heard it said on here that the housing bubble caused that. Which would tend to discount the effect the tax cuts had on that.

 

[FlagDUDE08]

Re: 2012 Presidential Election - The Day after the Aftermath...

You don't stimulate government revenue, you stimulate the economy. You shouldn't care about government revenue on a yearly basis, you care about the trend and underlying causes for any structural issues.

As far as the growth from 04-07, imagine what it wouldve been without the tax cuts. We might have even balanced the budget by then. Of course, ive heard it said on here that the housing bubble caused that. Which would tend to discount the effect the tax cuts had on that.

You're saying that 2004-07 is not a trend? Take down the blue-coloured glasses and look a little deeper into what I'm trying to convey. I understand that why I type may put your mind into a corn maze, but everything I say without a smiley has meaning to it.

Once again, you're making an assumption that the taxed amounts spent/invested/whatever-term-you-wish-to-use would still have been in play without the change in tax policy. They may not have even had that money to invest, and it would have instead been forfeited to the government through taxes. I'm sure we all have personal budgets, and we have ranked each of our line items based upon mandatory/discretionary and personal importance. If my tax bill goes up, I would likely be putting more into "savings" and taking it from stock market investment.

 

[FlagDUDE08]

Re: 2012 Presidential Election - The Day after the Aftermath...

Market 234098579327698, Government 1

 

[unofan]

You're saying that 2004-07 is not a trend? Take down the blue-coloured glasses and look a little deeper into what I'm trying to convey. I understand that why I type may put your mind into a corn maze, but everything I say without a smiley has meaning to it.

Once again, you're making an assumption that the taxed amounts spent/invested/whatever-term-you-wish-to-use would still have been in play without the change in tax policy. They may not have even had that money to invest, and it would have instead been forfeited to the government through taxes. I'm sure we all have personal budgets, and we have ranked each of our line items based upon mandatory/discretionary and personal importance. If my tax bill goes up, I would likely be putting more into "savings" and taking it from stock market investment.

But unless you believe we as a country are on the "wrong" side of the laffer curve, tax revenue would go up. It might not be 1-for-1, but it wouldn't be negative, either. I suppose you could think taxes are perfectly elastic, but they must assuredly are not, especially at the income levels in play in the current debate. While you might divert some amount from riskier investments to safer ones, that's pennies compared to institutional investors and the 1% who aren't going to hide their millions and billions under the proverbial mattress. They'll grumble and hire more accountants, but they're not going to stop trying to maximize their returns either way.

Again, this goes back to which problem you wish to solve. The weak economy or the debt. Tax cuts will stimulate the former at the expense of the latter. You can offset that with lower government spending, but that would defeat the stimulative effects. Likewise, no one is arguing that higher taxes will help the overall economy, but to the extent they will fund government programs which do, they are inherently necessary.

You're so focused on the negative effects of taxes that you're ignoring the negative effects of cutting spending and the positive effects of having certain programs.

 

[MinnFan]

Re: 2012 Presidential Election - The Day after the Aftermath...

But unless you believe we as a country are on the "wrong" side of the laffer curve, tax revenue would go up. It might not be 1-for-1, but it wouldn't be negative, either. I suppose you could think taxes are perfectly elastic, but they must assuredly are not, especially at the income levels in play in the current debate. While you might divert some amount from riskier investments to safer ones, that's pennies compared to institutional investors and the 1% who aren't going to hide their millions and billions under the proverbial mattress. They'll grumble and hire more accountants, but they're not going to stop trying to maximize their returns either way.

Again, this goes back to which problem you wish to solve. The weak economy or the debt. Tax cuts will stimulate the former at the expense of the latter. You can offset that with lower government spending, but that would defeat the stimulative effects. Likewise, no one is arguing that higher taxes will help the overall economy, but to the extent they will fund government programs which do, they are inherently necessary.

You're so focused on the negative effects of taxes that you're ignoring the negative effects of cutting spending and the positive effects of having certain programs.

History has shown that cutting spending has far less of a negative impact than increasing taxes. The Kindest Cuts

 

[Rover]

Re: 2012 Presidential Election - The Day after the Aftermath...

Notice Flaggy completely ignores tax receipts going up all thru the 90's which pretty much shoots his theory to hell! That's what's important when you're a conservative: the ability to create your own alternate reality.

Bottom line is broad based tax cuts on upper income people stimulates the economy of China. Why? Because that's where wealthy investors can park their money and get a far better return than the US since that nation's communist run, state planned economy can generate high single digit returns. Or the wealthy can put $$$ in up and comer Brazil. Even Germany if they feel the EU crisis will pass. So, to borrow money to cut a dollar of taxes, the multiplier on the amount that actually stays in the US economy would have to be 500% in order to have any net positive effect. That's obviously a stupid policy to pursue, but one conservatives have been following for 30 years and seem determined to continue to do so despite getting b ! tchslapped by voters yet again last month.

 

[FlagDUDE08]

Re: 2012 Presidential Election - The Day after the Aftermath...

Notice Flaggy completely ignores tax receipts going up all thru the 90's which pretty much shoots his theory to hell! That's what's important when you're a conservative: the ability to create your own alternate reality.

Bottom line is broad based tax cuts on upper income people stimulates the economy of China. Why? Because that's where wealthy investors can park their money and get a far better return than the US since that nation's communist run, state planned economy can generate high single digit returns. Or the wealthy can put $$$ in up and comer Brazil. Even Germany if they feel the EU crisis will pass. So, to borrow money to cut a dollar of taxes, the multiplier on the amount that actually stays in the US economy would have to be 500% in order to have any net positive effect. That's obviously a stupid policy to pursue, but one conservatives have been following for 30 years and seem determined to continue to do so despite getting b ! tchslapped by voters yet again last month.

Notice Rovy completely ignores the dot com boom all thru the 90's which pretty much shoots his theory to hell! That's what's important when you're a liberal: the ability to create your own alternate reality. [all sic and gic]

 

[unofan]

History has shown that cutting spending has far less of a negative impact than increasing taxes. The Kindest Cuts

Yeah, not so much. Even The Economist says the best austerity packages contain both.

 

[Rover]

Notice Rovy completely ignores the dot com boom all thru the 90's which pretty much shoots his theory to hell! That's what's important when you're a liberal: the ability to create your own alternate reality. [all sic and gic]

Its always the mark of a knuckledragger to credit a 10 year boom to a couple of year phenomenon. Funny, because if your crackpot theory were true, wouldn't those 22M jobs created during the Clinton administration have disappeared as soon as the "bubble" burst? (here's where Flaggy starts sucking his thumb and pitching a hissy fit as his logic is once again circling the bowl...)

 

[unofan]

Notice Rovy completely ignores the dot com boom all thru the 90's which pretty much shoots his theory to hell! That's what's important when you're a liberal: the ability to create your own alternate reality. [all sic and gic]

And the housing boom didn't cause the 04-07 expansion? How are you so sure it was tax rates in the oughts but not in the nineties?

 

[FlagDUDE08]

Re: 2012 Presidential Election - The Day after the Aftermath...

But unless you believe we as a country are on the "wrong" side of the laffer curve, tax revenue would go up. It might not be 1-for-1, but it wouldn't be negative, either. I suppose you could think taxes are perfectly elastic, but they must assuredly are not, especially at the income levels in play in the current debate. While you might divert some amount from riskier investments to safer ones, that's pennies compared to institutional investors and the 1% who aren't going to hide their millions and billions under the proverbial mattress. They'll grumble and hire more accountants, but they're not going to stop trying to maximize their returns either way.

Again, this goes back to which problem you wish to solve. The weak economy or the debt. Tax cuts will stimulate the former at the expense of the latter. You can offset that with lower government spending, but that would defeat the stimulative effects. Likewise, no one is arguing that higher taxes will help the overall economy, but to the extent they will fund government programs which do, they are inherently necessary.

You're so focused on the negative effects of taxes that you're ignoring the negative effects of cutting spending and the positive effects of having certain programs.

Here's one assumption that you're making: Any money that is currently on the investment table is money in the pocket. Personally, I see that money as gone. It's not in my regular budget. It's been spent, and in a completely separate entity in and of itself. Any smart investor I'm sure will tell you the exact same thing.

Here's another assumption that you're making: I want to cut spending and subsidy across the board without regard to its purpose or effectiveness. This is absolutely false. Even in this thread (or was it the economics one? I can't remember), I've had plenty of discussion regarding the acceptance of effective government spending. Engineering and science scholarships are a good thing; the government gets a return on these through a higher nominal level of taxes collected. Infrastructure investments are a good thing; it means less spent on commodities and more room to invest or save, resulting in a higher nominal level of taxes collected. Environmental regulations are not a good idea, though. This results in killing not only energy infrastructure, but also adds higher costs on commodities and products, which in turn can lower business, and you end up with a lower nominal level of taxes collected. How about health care administration through Medicare AND PPACA? Look at how much is now being spent on that, driving up the cost of health care, leaving less to be able to grow, and nominal taxes decrease.

 

[FlagDUDE08]

Re: 2012 Presidential Election - The Day after the Aftermath...

And the housing boom didn't cause the 04-07 expansion? How are you so sure it was tax rates in the oughts but not in the nineties?

What does the housing boom have to do with the earnings of Bristol-Myers?

 

[FlagDUDE08]

Re: 2012 Presidential Election - The Day after the Aftermath...

Its always the mark of a knuckledragger to credit a 10 year boom to a couple of year phenomenon. Funny, because if your crackpot theory were true, wouldn't those 22M jobs created during the Clinton administration have disappeared as soon as the "bubble" burst? (here's where Flaggy starts sucking his thumb and pitching a hissy fit as his logic is once again circling the bowl...)

Labour's the only expense, eh? There aren't any infrastructure costs? Also, every cost is in perpetuity, and not a one-time deal?

Like I had previously said, you could have put the tax rates at 99.6% and you still would have had growth.

 

[unofan]

What does the housing boom have to do with the earnings of Bristol-Myers?

The conversation had been about government revenue and economic activity, not corporate earnings. And even if we were, are you seriously arguing that the housing boom didn't have a positive effect on them?

I understand you see yourself as a financier of sorts, but the U.S. economy has more components than mere corporate earnings.

 

[unofan]

Like I had previously said, you could have put the tax rates at 99.6% and you still would have had growth.

So, why do tax cuts get the credit for 04-07, but they had no effect in the 90s? What evidence do you have to support these two seemingly contradictory beliefs? Why couldnt the economy have similarly grown from 04-07 even in the absence of tax cuts?

 

[Rover]

So, why do tax cuts get the credit for 04-07, but they had no effect in the 90s? What evidence do you have to support these two seemingly contradictory beliefs? Why couldnt the economy have similarly grown from 04-07 even in the absence of tax cuts?

Thank you unofan, that's the point I was trying to made evident to the little mental furball. If I was in the mood I'd also point out that the 80's "boom" was the result of a massive govt stimulus in the form of defense spending, and the economy went into recession when that ended at the close of the decade but that might overload his circuits.

 

[MinnFan]

Re: 2012 Presidential Election - The Day after the Aftermath...

So, why do tax cuts get the credit for 04-07, but they had no effect in the 90s? What evidence do you have to support these two seemingly contradictory beliefs? Why couldnt the economy have similarly grown from 04-07 even in the absence of tax cuts?

When Clinton initially raised tax rates the economy stalled. It didn't take off in the 90's until the capital gains rate was reduced. At the same time, gov't spending was essentially flat.

 

[unofan]

When Clinton initially raised tax rates the economy stalled. It didn't take off in the 90's until the capital gains rate was reduced. At the same time, gov't spending was essentially flat.

That wasn't his argument. He said we could have raised taxes to 90% and still seen economic growth.

I actually agree with him on that point. I just disagree with his conclusion that the 04-07 growth was somehow different and wouldn't have happened without the tax cuts.