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Old 01-07-2017, 10:58 PM
 
Location: Gilbert, Arizona
2,940 posts, read 1,806,666 times
Reputation: 1940

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Quote:
Originally Posted by Marc Paolella View Post
Yeah, I know, it's always wonderful and peachy "over there in Europe", based on some silly leftist United Nations criteria. With half-baked millennial-pleasing "data" and "statistics".


Guess what? I don't care about Scandinavia. If they want to live under a philosophy of redistributive theft, with "need" making it OK to plunder good people, then that's their funeral. That is not the American way, where we value individual rights OVER collective tyranny. Where freedom is more important than the ability to steal one's way to free food and free adult diapers and dental care.


We don't do that here, we shouldn't do it here. We're better than Scandinavia and Europe and all the leftist paradises "over there in Europe".


Which by the way, the whole Leftist Scandinavian meme is nonsense:


Swedish Economist Schools Sanders On The Ravages Of Socialism | Stock News & Stock Market Analysis - IBD


Debunking the Myth of Socialist
Most people on the right like yourselves would consider progressive taxation distributive theft.
Fair point, sure. The question is, is your entire sum of wealth purely gained by earned income? Or was it a combination of capital gains and timing markets, etc..?

If most of your income is from capital gains, playing with stocks, investments, and the likes, I'd argue, you didn't work for it. You only worked for the principal of which you used to invest it and took advantage of how our financial system works to gain more (and this behavior is promoted by capitalistic societies, called greed).
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Old 01-07-2017, 11:47 PM
 
Location: Gilbert, Arizona
2,940 posts, read 1,806,666 times
Reputation: 1940
Quote:
Originally Posted by InformedConsent View Post
Yet the chart YOU chose to post shows a direct correlation between higher VAT taxes and higher rates of transfers.

Like I said, and like the research shows... the more regressive the tax system, the more progressive the transfers.
Let's go to academia (*ahem* a scientific field of study called macroeconomics) for this to see if you're right: Chapter 13: Fiscal Policy


Chapter 13: Fiscal Policy
This chapter describes the government mandates (discretionary fiscal policy) to stabilize national output, employment, economic growth and inflation. It examines the use of fiscal policy during contractionary and expansionary gaps through aggregate demand and aggregate supply model.

The chapter also examines Non-discretionary fiscal policy ( built-in or automatic stabilizer) that measures government expenditures and tax revenues to adjust the economy in there is business cycle.

In the early 1980s, U.S. government introduced a 25% reduction in personal income tax without changing government spending. This policy led to the expansion of aggregate demand to get the economy out of the recession of the early 1980s, and to increase output and employment.
U.S. government raised taxes on both corporate and personal income taxes during Vietnam war.
The purpose of the government intervention through government spending or taxing is to make the economy more stable. For example, Employment Act of 1946 was a Congressional mandate to promote economic stability. This legislative mandates was government's role to achieve full employment and output level.

The council of economic advisors (CEA) to advise the president for economic issues.
The Joint Economic Committee of Congress to investigate economic problems of national interest.
Discretionary fiscal policy: the deliberate changes of taxes and government spending by Congress to stabilize the economy through aggregate demand by achieving full employment, control inflation, and economic growth.

A- Expansionary fiscal policy:

By increasing government spending, the aggregate demand will shift to the right (spending on highways, satellite communications). For example if the MPC =0.75, then the multiplier will be 4 and the aggregate demand will shift back to the right by 4 times the amount of government spending (say 5 billion dollars).

By reducing taxes the aggregate demand curve will shift to the right. For example, government cuts personal income taxes by $6.67 billion which will increase disposable income by the same amount. MPC(.75) times $6.67 billion dollars equals $5 billion and saving will increase by 1.67 billion( MPS times 6.67 billion ). The initial increase in consumption spending is $5 billion because of the multiplier effect, the real GDP will increase by $20 billion. If the MPC is smaller then it is needed a higher tax cut.

The combination of both policies( decreasing taxes and increasing government spending)


Contractionary fiscal policy: by fighting against demand-pull inflation.
There are 3 cases involved here.

By reducing government spending, the aggregate demand will shift to the left and prices will fall down assuming that there is downward price flexibility( see figure. But real GDP will be the same because of that aggregate supply is vertical.
By raising taxes, aggregate demand will shift to the left If marginal propensity (MPP) is 0.75, government has to increase taxes by $6.67 billion to reduce consumption by $ 5 billion(.75 * 6.67= 5 billion) and 0.25 * 6.67 billion = $1.67 billion reduction in saving (see figure 12.2).
Combined government spending cuts and tax increases. For example, a $2 billion decrease in government accompanied with a $4 billion increase in taxes, aggregate demand would shift by how much? Government spending will increase by $2*4 = $8 billion after multiplier effect.; tax cut will be .75*4 billion = $3 billion, and $1 billion of saving(.25*4 billion. After multiplier effect, the effect will be $3 billion times the multiplier (4) = $12 billion. Therefore the combined effect, which is $8 billion + $12 billion = $20 billion, that aggregate demand will decline.

Financing of deficits, and disposing of surpluses.

Borrowing versus new money.

Government can finance a deficit by two ways.

Borrowing : if the government borrows money this will lead to interest rate increase and crowd out some private investment spending. For example, decreases in private spending reduce the expansionary impact of the deficit spending.
Money creation: If the government finances its deficit spending by creating new money, then there is no crowding out of private spending. That is this spending will increase without reducing consumption or investment. This kind of financing is a more expansionary way but more inflationary.
Debt retirement versus idle surplus

1- debt reduction: The government should use the surplus by paying of f the debt. This means that the government buys back some of its bonds, and this will to interest rate decrease and private borrowing and spending will increase.

Therefore, the increase in private spending offsets the contractionary fiscal policy.

Impounding: if the surplus tax revenue are not spent in the economy (idle surplus ), then this will lead to more ant-inflationary impact of the contractionary policy.
Liberals recommend government spending increase during demand-pull inflation because there are many social needs to be supported.

Conservatives advocate that public sector is too large and inefficient therefore they recommend tax cuts during recessions and reductions in government spending during demand inflation.

Non-discretionary fiscal policy( automatic stabilizers or built-in): Automatic stabilizers are types of automatic fiscal policies which do not require new legislation Act from Congress. They are as a result of net taxes which changes as GDP changes( see figure 13.5). Net taxes are taxes minus subsidies and transfers.

The progressive income tax: Taxes increase automatically as income increase and fall as income declines.
Unemployment compensation: Transfers and subsidies increase as GDP decreases. That means unemployment compensation payments rise as the economy slums into a recession and vice verse as the economy expands.

The magnitude of automatic stability depends on responsiveness of changes in taxes to changes in GDP.
Possible offsets of fiscal policy: Crowding-out effect:

- Indirect crowding out: the tendency of expansionary fiscal policy through deficit spending increases interest rate which in turn reduces investment and consumption. The interest rate declines because government finances budget deficit by government borrowing and this will compete with the private sector in terms of borrowing money. Because of this, aggregate demand increases by less than the amount of the increase in government spending.

Direct Crowding out: that is when expenditures offsets directly. Actions taken by the private sector will offset government spending actions. That is the way private sector will spend their money cancel out government actions.
The open economy effect: when interest rate increases as a result of government deficit spending through borrowing, then foreigners will demand more dollars. As a result dollar appreciates which means that the value of dollar will increase relative to other currencies. Therefore, U.S. exports will decrease and imports will increase and aggregate demand will decrease by the amount of export decrease.

Fiscal policy and time lags:
- recognition time lag: the time lag required to get information about the economy ( recession or inflation)
- Administrative time lag or action time lag: the time required between recognizing the economic problem and applying fiscal policy into effective. It is to short for both monetary and fiscal policy.
- Operational lag or effect time lag: the time that elapses between the onset of the policy and the results of that policy.


By definition:
MPC = https://en.wikipedia.org/wiki/Margin...ity_to_consume
Meaning, for every extra dollar you make, there comes a point where you make enough money to cover your cost of living, therefore you spend some but save the rest of it. Therefore if a tax cut is given to the richest people, the net effect on the total economic spending is much less than if you were to give a tax cut to the middle and lower classes.

This does NOT sound regressive at ALL.
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Old 01-08-2017, 12:52 AM
 
421 posts, read 204,425 times
Reputation: 459
Thanks to Obama, a lot of Americans (traditionally with a worldwide reputation for being fat/obese) are now actually LOSING weight from not even being able to buy enough food/calories. In recent years with Obama arbitrarily "tacking" on another unwanted $200-$1000 monthly bill in the form of Obamacare a lot of Americans were suddenly tight on money.

I see it all the time, this is a very real issue. You have huge swathes of Americans eating crappier food simply because it's all they can afford post-Obama. A lot of Americans, after their health insurance, after student loan payment, after rent, after gas, after essentials, etc are being reduced to bottom-feeder "scavenger" style coping strategies like relying on the McDonald's dollar menu, shopping at Dollar Tree, buying from the "managers special" expired food corner of the grocery store, etc. This is both sad and true at the same time

Logically the recent trend of weight loss makes sense, for example:

1. during pre-Obama years lets say person A is doing fine financially and consumes the normal 2500-3000 calories for an adult, this person maintains their weight and their health

2. during post-Obama years person B is living paycheck-to-paycheck and squeezing every penny, this person is being reduced to cheap fast food and lower quality food, this person maybe gets 1000-1500 calories a day, and thus experiences weight loss
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Old 01-08-2017, 04:19 AM
 
Location: Unperson Everyman Land
38,625 posts, read 26,311,930 times
Reputation: 12635
Quote:
Originally Posted by Casper in Dallas View Post
Fracking has slowed dramatically due to the low prices and will not be ramping up until it becomes more profitable to do.


Correct, US fracking acts as a permanent cap on the price oil exporting nations may charge.


I like to think of it as a shock collar for the Saudis.


The old days of OPEC cutting production to increase the price of crude oil are over.


Thank you President Bush and Vice President Cheney.
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Old 01-08-2017, 04:31 AM
 
Location: the very edge of the continent
88,801 posts, read 44,610,756 times
Reputation: 13625
Quote:
Originally Posted by man4857 View Post
One can argue, if you provide for, you are promoting general welfare.
One can, but those aren't the words in the Constution. Defense must be provided for. Welfare only needs to be promoted.
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Old 01-08-2017, 04:53 AM
 
10,829 posts, read 5,421,103 times
Reputation: 4710
Quote:
Originally Posted by Chriz Brown View Post
People always blame politicians, laws, and illegal aliens for all our economic problems. However, the true cause of our problems are over population and declining natural resources.
If overpopulation is a problem, why are you in favor of illegal immigration?

Quote:
We have already used half of the world's oil
They said that in 1950 -- 67 years ago. They were wrong then. I doubt that you're right now.

Quote:
For these reasons.. oil will continue to become more expensive
"Continue?" It's cheap right now.

Quote:
We import the majority of our oil from the middle east.
No, we don't.

We import the majority of our oil from Canada and Mexico.

Now we have discovered that we have so much oil here in the U.S. that we can actually export it if we choose to drill on federal lands. We also have enough coal to last us for hundreds of years.

Quote:
To anyone who believes this is "fear mongering" or "Liberal propaganda" I just ask that you provide a good argument with strong evidence and facts.
You need to come up with facts first, and you haven't so far.

Falsehoods are not facts.
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Old 01-08-2017, 05:04 AM
 
Location: the very edge of the continent
88,801 posts, read 44,610,756 times
Reputation: 13625
Quote:
Originally Posted by man4857 View Post
Let's go to academia (*ahem* a scientific field of study called macroeconomics) for this to see if you're right
I've already posted the info on the research:
Quote:
Prasad and Deng found that the progressivity of countries' tax codes is negatively correlated with the amount of redistribution they do. In English: The less progressive the [tax] code, the more progressive the [redistribution] system.

https://www.washingtonpost.com/news/...=.9b8102d36318

For reference, that's a scatter plot graph which is used to show a relationship between two sets of data. In this case the sets are Tax Progressivity, and Income Redistribution in the form of social program government benefits and services (health care, social safety nets, etc.) transfers. Note that the highest levels of government benefits and services are provided by countries (Sweden, Denmark, Finland, Belgium) in which taxes are flat (everyone pays the same tax rate) or regressive (shown as the negative values, meaning a greater tax burden placed on those with lower incomes). And note where the USA falls on the graph. The USA has the most progressive tax system and therefore is least able to fund progressives' societal goals.

The research:

https://www.econstor.eu/bitstream/10.../576828521.pdf
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Old 01-08-2017, 05:11 AM
 
Location: the very edge of the continent
88,801 posts, read 44,610,756 times
Reputation: 13625
Quote:
Originally Posted by scend57 View Post
Thanks to Obama, a lot of Americans (traditionally with a worldwide reputation for being fat/obese) are now actually LOSING weight from not even being able to buy enough food/calories. In recent years with Obama arbitrarily "tacking" on another unwanted $200-$1000 monthly bill in the form of Obamacare a lot of Americans were suddenly tight on money.
Life expectancy has also declined and disease fatalities have increased. Obamacare = Making Americans Sick (or even Dead) Again.

US life expectancy falls, as many kinds of death increase | Health News | US News

People can't afford to use their Obamacare. The premiums plus deductibles are way too high.

Obamacare Has Turned Voters Against Sharing the Wealth:
http://www.nytimes.com/2015/04/15/op...alth.html?_r=0
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Old 01-08-2017, 05:53 AM
 
8,598 posts, read 9,095,508 times
Reputation: 5934
Quote:
Originally Posted by InformedConsent View Post
One can, but those aren't the words in the Constution. Defense must be provided for. Welfare only needs to be promoted.
"We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness."

I like this quote from Stewart Roberts, professor of medicine at Emory University, a member of the CES Medical Advisory Committe back in the early 1900s.

"There is not much liberty without some economic safety and not much happiness without some health and not much life without both."
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Old 01-08-2017, 06:19 AM
 
Location: the very edge of the continent
88,801 posts, read 44,610,756 times
Reputation: 13625
Quote:
Originally Posted by jmking View Post
"We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness."
Life? One is born with life.

So... pursue happiness. I see no requirement where others must be forced to fund that pursuit.

And a very valid case can be made that forceful confiscation of anyone's personal property (their money) is a direct violation of that "unalienable Right" to Liberty.
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