Tea party tax cuts are ravaging the Kansas economy (Clinton, Kennedy, Obama)

[It'sAutomatic]

Originally Posted by pnwmdk

Explain to me how government taxation improves the economy.

Provide 5 concrete examples. And then back up your argument when I refute you.

How about all of the public services available, paid for by taxes? Having firefighters and police officers is good for the economy.

Originally Posted by It'sAutomatic

How about all of the public services available, paid for by taxes? Having firefighters and police officers is good for the economy.

No no, you just don't get it. The way to have roaring economy is to have no police, no firefighters, no schools, and no roads. Because you know, that's worked anywhere, ever.

[ChrisC]

Economics is not a government function. Government is a cancerous tumor upon economics. Economics is about the exchange of labor, goods, and currency between peoples. It's not about how many freebies you get from Santa Claus.

[ChrisC]

Originally Posted by JasonF

No no, you just don't get it. The way to have roaring economy is to have no police, no firefighters, no schools, and no roads. Because you know, that's worked anywhere, ever.

Even the most libertarian of libertarians often would not argue these. I think most of them would be ecstatic if that were the government's sole function. I believe that it's the other 99.9% of government function that is disputed by libertarians. So you can drop that argument. It's hyperbole. Just the same as if you were to bring up Somalia.

Originally Posted by ChrisC

Even the most libertarian of libertarians often would not argue these. I think most of them would be ecstatic if that were the government's sole function. I believe that it's the other 99.9% of government function that is disputed by libertarians. So you can drop that argument. It's hyperbole. Just the same as if you were to bring up Somalia.

And yet we have people in this very thread insisting that there aren't five things that government does that lead to increased economic output.

[Patricius Maximus]

If tax hikes work so well to stimulate the economy, how come California, Illinois, and Maryland are experiencing similar or worse problems than Kansas is now? The only two states that could be considered economically successful during the past 5 years are Texas and North Dakota, and both of those are part of that maligned group that have low taxes and "no basic government services". You can say what you want about whether they'd be better off if they followed different ideas, but lower taxes and fewer services has certainly not hurt their state to any significant degree. Also, I don't get this furor over the tax cut decreasing revenue - isn't it the whole point of cutting taxes for the government to take less money from people, so that those people can use that money to improve their own lives and make their own decisions about their future, thereby benefiting society as a whole? A decrease in revenue should be expected and planned for with spending cuts, and it appears that Kansas has fallen short in the planning department. Failing to cut spending enough is their problem, not cutting taxes - plenty of other places have cut taxes and not experienced these problems.

This whining about roads and firefighters is a red herring - if you add up spending on roads, police, and firefighters it comes to far less than the tax revenue that is coming in, so they could be fully funded with plenty left over. Most states' budgets are sucked up by welfare, schools, and medical care, and that triad of red ink is what is under strain, not police and firefighters. Government services in general do not add a cent to the economy - forcibly taking money from people in the form of taxes and sending it to some other purpose such as "government services" only redistributes funds in the economy; the act of taxing and spending does not create value or wealth of any kind, whereas the original owner of that money would have used it to create or purchase some value for himself and the other party to the transaction. Many here have fallen victim to the broken window fallacy, only considering what is seen without taking into account what is unseen. As Frederic Bastiat said in his essay:

Originally Posted by Frederic Bastiat (excerpt from That Which is Seen, and That Which is Not Seen (1850))

Suppose it cost six francs to repair the damage, and you say that the accident brings six francs to the glazier's trade - that it encourages that trade to the amount of six francs - I grant it; I have not a word to say against it; you reason justly. The glazier comes, performs his task, receives his six francs, rubs his hands, and, in his heart, blesses the careless child. All this is that which is seen

But if, on the other hand, you come to the conclusion, as is too often the case, that it is a good thing to break windows, that it causes money to circulate, and that the encouragement of industry in general will be the result of it, you will oblige me to call out, "Stop there! your theory is confined to that which is seen; it takes no account of that which is not seen.

It is not seen that as our shopkeeper has spent six francs upon one thing, he cannot spend them upon another. It is not seen that if he had not had a window to replace, he would, perhaps, have replaced his old shoes, or added another book to his library. In short, he would have employed his six francs in some way, which this accident has prevented.

Let us take a view of industry in general, as affected by this circumstance. The window being broken, the glazier's trade is encouraged to the amount of six francs; this is that which is seen. If the window had not been broken, the shoemaker's trade (or some other) would have been encouraged to the amount of six francs; this is that which is not seen

And if that which is not seen is taken into consideration, because it is a negative fact, as well as that which is seen, because it is a positive fact, it will be understood that neither industry in general, nor the sum total of national labour, is affected, whether windows are broken or not.

Now let us consider James B. himself. In the former supposition, that of the window being broken, he spends six francs, and has neither more nor less than he had before, the enjoyment of a window.
In the second, where we suppose the window not to have been broken, he would have spent six francs on shoes, and would have had at the same time the enjoyment of a pair of shoes and of a window.
Now, as James B. forms a part of society, we must come to the conclusion, that, taking it altogether, and making an estimate of its enjoyments and its labours, it has lost the value of the broken window.
When we arrive at this unexpected conclusion: "Society loses the value of things which are uselessly destroyed;" and we must assent to a maxim which will make the hair of protectionists stand on end - To break, to spoil, to waste, is not to encourage national labour; or, more briefly, "destruction is not profit."

Aside from the odd piece of infrastructure here and there, government taxation and spending follows this process - at best it only redistributes, neither creating nor destroying wealth or value, but at worst it sucks away money into a black hole that would have been used for far greater purposes by its owners.

One of the greatest black holes is medical care. Medicaid programs, which comprise the bulk of Kansas's health care spending, offer extremely dubious value for what is being spent on them; the most comprehensive study to date on the subject finds that Medicaid had no significant effect on health outcomes versus being uninsured, and Medicaid expansion actually increases ER visits, both of these contrary to the gospel of official Washington where "Medicaid helps people, ergo more Medicaid=more help" . Medicaid does not make people healthier, and nationwide $400 billion is being taken from the public every year to fund this monstrosity that entails no benefits, representing a loss to the economy of $400 billion per annum - with that in mind, why shouldn't we abolish the program and let people use that $400 billion for other more enjoyable and productive purposes?

Education is another black hole. Per pupil spending has more than doubled since 1970 with no change in NAEP scores (source) and no change in the perceived quality of the schools. The total K-12 cost has tripled in the same time period. Surely education spending could be reverted to 1970 levels with no ill effects, which would represent a 50-70% cut. The average public school costs $11000 per pupil per year; the vast majority of private schools you'll find of comparable quality to the average public school cost much less than that, most studies concluding roughly half. If public schools charged $11000 for what they were offering they would quickly go out of business in favor of private schools that charged less and offered better quality. Government by its nature offers a one-size-fits-all system, which may fit some areas, but is particularly unsuited to the market of educating millions of individual children with individual minds, experiences, and learning styles.

The free market system, if unleashed in education, will provide education that is far cheaper, of better quality, and that is born by customers and/or voluntary donors. No doubt if a community abolished public schools and compulsory enrollment (so as to not distort the market), the existing private schools would be filled to capacity with middle income students - seeing as people consider education an essential service, demand would be extremely high for new schools, particularly among the lower income students, and entrepreneurs and charitable individuals will see an opportunity and open up new schools. These new schools will follow a multitude of different models, varying more widely than public schools could ever hope to. There will doubtlessly be dozens of models available in the price range of the vast majority, offering better fits for greater numbers of students who were previously subject to the one-size-fits-all model of government schools. There will be a demand from lower income students as well; lower income people will be left with nothing at first, but then they will take a page out of homeschoolers' playbook and pool their resources into educational cooperatives. Charitable, scholarly, and entrepreneurial types will dream up ideas for opening schools for the poor, and then raise funds to help bring down tuitions for their clientele; these will vary almost as widely as the schools at higher ends of the income scale. Financial aid for other types of schools will be factor, opening up even more opportunities for students. Fundraisers would be widely successful and many people would enter the field because we as a society consider education to be essential - the same mentality that works against us changing the government system will work for us in making the free-market system work for everyone. Think this is impossible? A pie-in-the-sky libertarian fantasy filled with unrealistically perfect people? That in reality no one would do it if the state doesn't?

Well, without government who would plow the roads in Yellowstone? If government cut them off an essential service would be gone and the economy would collapse, wouldn't it? Not so. When the Sequester of 2013 cut them off, the residents launched a fundraising drive to enable the roads to be plowed in the Spring like usual, and the frequent visitors and other individuals chipped in for what they considered an essential service - the residents then proceeded to plow the roads themselves without government funding and visitors could enjoy the road.

Without government who would maintain the parks in Detroit? If government cut them off an essential service would be gone and children's quality of life would suffer, wouldn't it? Even if they could be privatized greedy millionaires would lock out the poor keeping it for themselves, wouldn't they? Not so. 2014 marks four years since one man with a mower, a mind, and some free time created the Detroit Mower Gang to have a good time and do good for children in the midst of park funding being cut off by the government. This is another instance of the do-it-yourself approach to essential government services that is not only effective, but is immune to the vagaries of politics. If you still doubt whether this is possible, waltz over to any of your local grocery stores or food banks where you can see people buying, selling, or giving food, a human need even more basic than education, most of whom are using no government funds in doing so.

There is a lot of haggling over welfare and how much of a role government should play in that, but education and health care combined are more costly and more impactful than welfare yet that issue gets much less press. According to Ballotpedia, in Kansas if Medicaid and K-12 schools were eliminated, which I've already argued would be a great benefit to the state, you've eliminated 44% of the state budget! Spending is reduced from $14.4 billion to $8.1 billion - that more than takes care of the budget shortfall, and instead gives a windfall surplus which can be invested in a sovereign wealth fund, returned to the taxpayers, used to pay debt, or spent elsewhere. If you throw in higher education spending (a different kettle of fish so not covered previously), you've eliminated 61% of the state budget, without touching non-Medicaid welfare, police, firefighters, or transportation.

Originally Posted by JasonF

When done in a way that means you can't properly fund police, roads, and schools, it's obviously going to negatively impact the state.

Police and roads amount to 11% of the Kansas state budget, and adding in K-12 schools it comes to 37%. Since over 90 percent of the budget is covered by revenues, there is no excuse except laziness to properly funding police, roads, and schools, considering that the state has sufficient funds coming in to do so.

This much should be obvious to anyone with a few functioning synapses (something the all taxes are bad right clearly lacks). All we have to do is either think for a couple seconds or look at country's where they can't fund such things to see what happens.

It's amazing to me that people in the US actually think turning us into sub-Saharan Africa would somehow be a good thing.

The reason sub-Saharan Africa cannot fund such things is because they don't have any money available in the first place - most of Africa has a GDP (PPP) per capita roughly a tenth of the developed world, so they couldn't fund first world essentials no matter what means they used even if they wanted to. Their economies have to grow before that can happen; they suffer from "100% of nothing is nothing" syndrome. It should also be noted that these poor countries score very low in economic freedom, so they're not suffering from any lack of forcible intervention. The reason a developed country can fund such things is not because of high taxes, but because the money is available to tax and redistribute in the first place; without taxation, the money would still be there available for people to spend on these essentials, which is quite a different situation from what most of Africa faces. Whether this would be a drawback or a benefit is another matter, but my point here is that it is ridiculous to suggest that lack of taxation will put a country into the Third World.

[Volobjectitarian]

Good stuff Patricius. Good freaking stuff.

[pnwmdk]

Originally Posted by It'sAutomatic

How about all of the public services available, paid for by taxes? Having firefighters and police officers is good for the economy.

Ok, a fraction of a percent of our taxes are going to something worth while. (there's no reason that fire departments can't be private. Many are, and are usually better than the public ones)

You still haven't answered the question.

Again, how do taxes improve the economy.

[NCN]

I was listening to a TV program one day on welfare in America and it said Kansas was the first state to pay welfare with tax money. Anyone know the history on this?

I was also listening to a person who had written a book about what the Bible says about many things and learned the church is supposed to feed the sick and widows and orphans and the government is responsible for protection. If you want to straighten out things in any situation it is good to go back to basics.

[GnomadAK]

Originally Posted by TreeBeard

Voodoo economics did not work Reagan; did not work for W; does not work for Brownback.

But you guys continue to keep the faith.

Were you actually an adult, or even alive, during the Reagan years?

At the time, I remember the "tax cuts for the wealthy" and how they would crush the middle and lower class. And yet, I went from owing taxes under Carter to getting a refund under Reagan, and I was a helluva long way short of being a millionaire. The way the economy roared and the feeling the energy of the time, the certainty that tomorrow was better than today and the day after that, even better. We shucked of fthat typical Democrat funk of things aren't ever going to get better and all we can do it manage the decline for a soft landing.

And if tax cuts are so bad, why did the Bamster go with "making work pay"? Tell you what, find me society that has taxed itself to propsperity and if it exists, why aren't you all living there?