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when you tax a thing, you get less of that thing. when you tax people you get less productivity, especially when you tax the very people that create the vast majority of jobs in this country, small business. on top of that when you increase regulations on business, it costs business more to comply with those regulations, and that too will cost jobs.
So this is your idea of knowing things as opposed to speculations and estimates based on assumptions, somehow superior to the rules and guidelines that CBO uses. To put things into perspective, so you don't wonder about my response, let me quote the post that got me to engage with you in this topic:
Quote:
Originally Posted by rbohm
the problem with the so called experts saying that keeping the tax cuts will cost X number of dollars, or that raising taxes will increase revenues X number of dollars is that they are using static models, and the economy is dynamic.
Now, how is your model superior, if different from CBO's? As far as I can see, there is nothing factual about it, just a set of ideological belief. The question here is, do you stick with ideology regardless of its consequences, and especially on the issue of deficit and debt?
Most people that place an argument for low taxes also tend to use Laffer Curve (but only its name, not necessarily what is in it or what it looks like). Laffer curve's most significant attribute is its shape. It is a curve, for goodness sake, complete with a point of equilibrium where maximum returns is expected. The key to finding that point is not in ideology that tax cut is always great and benefits, or tax increase is the best idea, but to try and find a balance.
I'm afraid, the last two (Bush) tax cuts slid us past that equilibrium point. The tax cuts weren't implemented to increase the tax revenues (quote me a person from the administration/Congress who claimed that) but to redistribute the money and not worry about reducing the national debt. A few bones were thrown at the mainstream America (95% of it), and steak reserved for the rest. Country's welfare and the need to address the debt... what is that? Cutting debt doesn't help score political points and win elections as does the "tax cuts" does. Clearly.
Quote:
the CBO uses a static model when they calculate what effect changes in tax rates, and other things have on the economy. the problem with a static model is that it makes assumptions that are generally incorrect. for instance, the CBO may figure that the economy will grow at a rate of say 4% for the year, and base their number on that increase in growth. and then when congress decides that they need more money, they say increase taxes, so they do, and the economy, being dynamic, only grows at a rate of 2.5%.
And adjustments will be made accordingly. If you don't draw a baseline, you don't have a way to measure success or failures. For estimates, as logic dictates, unless you have a crystal ball, or a time travel mechanism, you can't predict the future accurately. You do the best, with the information you have, and be pragmatic about making adjustments along the way.
To say... tax cuts = low deficits and better economy is without baseline, logic, or pragmatism in general. It is all about a one dimensional ideology.
yep, if the left was a fiscally conservative as bush was, then the government would not have added $3 trillion to the national debt, and tripled the deficit in 18 months. remember it took bush eight years to add $5 trillion to the national debt.
i fully agree with cutting spending, and rather substantially across the board, say 15-20% off the top. however increasing taxes is not a good idea. a better idea would be to eliminate many outdated, duplicitous, and contradictory regulations as possible, we can leave tax rates where they are for now. if we cut the red tape that businesses have to go through to start up or expand, it will substantially cut the cost of business, and then the businesses will have more money for adding new employees.
when you tax a thing, you get less of that thing. when you tax people you get less productivity, especially when you tax the very people that create the vast majority of jobs in this country, small business. on top of that when you increase regulations on business, it costs business more to comply with those regulations, and that too will cost jobs.
the CBO uses a static model when they calculate what effect changes in tax rates, and other things have on the economy. the problem with a static model is that it makes assumptions that are generally incorrect. for instance, the CBO may figure that the economy will grow at a rate of say 4% for the year, and base their number on that increase in growth. and then when congress decides that they need more money, they say increase taxes, so they do, and the economy, being dynamic, only grows at a rate of 2.5%. when that happens all the CBO numbers become irrelevant. static models dont take into account what people will do when faced with having to pay out more money. those that can will put their money away, and wait for a time when the environment is better before they spend it.
on this we agree. the problem with a balanced budget amendment is that it prevents the government from spending money when it absolutely has to, such as during war time, and no not now or even the vietnam war, but times like WW l and WW ll. during peace time though we need a balanced budget amendment.
as i said before, tax increases, especially now, are a bad idea. as for spending, i have also said before that we should cut spending across the board by 15-20% off the top. and none of this, we cut the increase that we were going to do in spending by 50% so we cut the budget by 50%, bravo sierra. it needs to be real spending cuts. if a program spends $10 million per year, we cut $2 million per year from the program.
a 3% increase in taxes on $300k per year is not $600, it is more like $9000. as for the people making $250k or more being rich, that depends on where they are. for instance if you make $25k per year, and you live in a small town like stanley virginia, or ajo arizona, you are doing rather well. your costs are fairly low, and you can put money away for retirement. but lets say you make that magic $250k per year, but you live in midtown manhattan new york. your rent in going to be something like $6k per month, or $72k per year, and that is just to put a roof over your head. now your tax rate, including state taxes, is going to be north of 50% total, but lets use 50%. that means that you are taking $125k, and your rent is $72k, so now you have a net of $53k for food, transportation, retirement, etc. while $53k may go quite far where you live, in new york city it will go away a lot faster than you think. if your taxes go up 3%, that $53k now becomes $45,500. and that is just federal taxes. and again that assumes a 50% total tax rate to make the numbers easier.
1. No, its basically $600, actually $608 if you want to get technical. The 3% increase is not on the entire income, its only on the income above $250,000. Also the 28% bracket will be extended upward a bit. Around $282,000 is generally the level when you will start paying higher.
2. I live in a very high Cost of Living Area. Not quite Midtown Manhattan, but Long Island has one of the highest COL in the country. Someone making $250,000 a year here is doing VERY well, and you can find plenty of places in midtown Manhattan to rent under $6,000 a month. I am about to run out for a bit, so can't fiddle with the numbers right now, but you are uite off in your assumptions to say the last. I am quite familiar with NYC, live on LI and use to work down in the Financial District.
Yep. Democrats won't generally agree to it, to carry on with sometimes ridiculous spending. Republicans hate it because then they will have to show that their political basis (no, not evangelicalism, the other kind of their preaching... tax cuts) is not what they advertise to get their sheeple in awe.
The Republican seems to have only one thing in their mind when they want to retain the tax cuts for the wealthiest two percent while letting the tax cuts for those with lowest income expire namely cementing income inequity between the wealtiest and the poorest wich thanks to the Bush tax cuts today is the highest since 1928.
It is also a Republican proposal that will lead to great accumalated debt over the years combinded with reduced economic growth since the regressive Bush tax cuts are a extremly inefficent when it comes to stimulate the economy.
It will lead to reduced consumer spending and increased savings since the wealthiest houshold save the proportion of their income that they get trough tax cuts while the middle class and working class use their income from tax cuts for spending.
Nice deflection, maybe try and deal with the issue rather than turn it around to Obama all the time.
SHORT CIVICS LESSON
The Washington Post babbled again today about Obama inheriting a huge deficit from Bush. Amazingly enough,...... A lot of people swallow this nonsense. So once more, a short civics lesson.
Budgets do not come from the White House. They come from Congress, and the party that controlled Congress since January 2007 is the Democratic Party. They controlled the budget process for FY 2008 and FY 2009, as well as FY 2010 and FY 2011. In that first year, they had to contend with George Bush, which caused them to compromise on spending, when Bush somewhat belatedly got tough on spending increases.
For FY 2009 though, Nancy Pelosi and Harry Reid bypassed George Bush entirely, passing continuing resolutions to keep government running until Barack Obama could take office. At that time, they passed a massive omnibus spending bill to complete the FY 2009 budgets.
And where was Barack Obama during this time? He was a member of that very Congress that passed all of these massive spending bills, and he signed the omnibus bill as President to complete FY 2009. Let's remember what the deficits looked like during that period.
If the Democrats inherited any deficit, it was the FY 2007 deficit, the last of the Republican budgets. That deficit was the lowest in five years, and the fourth straight decline in deficit spending. After that, Democrats in Congress took control of spending, and that includes Barack Obama, who voted for the budgets. If Obama inherited anything, he inherited it from himself.
In a nutshell, what Obama is saying is I inherited a deficit that I voted for and then I voted to expand that deficit four-fold since January 20th.
Ahh so I am guessing you would be against cutting oil subsidies??
And we aren't 'punishing' anybody we are having taxes based on who can most afford them. Those who are at the top who will see an increase are still going to be rich. We aren't taxing them to the poor house, or to the middle clas, they will still be wealthy.
Not sure which oil subsidies you are referring to. Did you mean the two billion loaned to Petrobras?
I would definitely be against that.
The issue isn't who pays the taxes.
The issue is the taxes.
The federal government has assumed vast powers not authorized by the Constitution imposing its will more and more into our private lives. The more money it is fed, the hungrier it becomes. More taxes will never satisfy government and more spending is never enough. The debt levels will rise no matter how much revenue is taken from the productive sector because Congress cannot stop itself from spending.
Notice how the cuts are almost identical up to the half a million in income mark? Then look what the Republicans want to give the multimillionaires. Care to explain how that kind of disparity makes any sense? Why do they deserve that kind of government handout just because they're wealthy beyond anything the average American can ever hope to achieve?
How in the hell does keeping more of the money you earn become a government handout?
Not sure which oil subsidies you are referring to. Did you mean the two billion loaned to Petrobras?
I would definitely be against that.
The issue isn't who pays the taxes.
The issue is the taxes.
The federal government has assumed vast powers not authorized by the Constitution imposing its will more and more into our private lives. The more money it is fed, the hungrier it becomes. More taxes will never satisfy government and more spending is never enough. The debt levels will rise no matter how much revenue is taken from the productive sector because Congress cannot stop itself from spending.
Yep and the government is happy keeping us fighting about who pays taxes while stealing it from right under our noses.
People need to wise up and realize that it's not the rich that are breaking our country, it's our government. And its not just the democrats or the republicans, it's everyone who's in office.
busta
busta
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