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indeed you shouldn't, because the laffer curve is a weak argument which only applies at extreme levels of taxation.
Uh, wut? Are you suggesting that 35% of $0 is >$0?
Quote:
Originally Posted by danielpalos
Business ventures do that all the time. How many large business ventures do you believe use cash to start that venture? Many businesses are started using the debt of venture capital.
Yeah? So freaking what?
Are you suggesting the government should transform into a dictatorship? Because, um, that's what businesses are...dictatorships, not representative democracies or parliaments.
Company management, staff and employees do not sit around and vote on how the company should spend its money or what course of action the company should take. The CEO, President, Senior Partner, or Owner does that unilaterally.
Quote:
Originally Posted by MTAtech
That's precisely the fallacy position Keynes attributed to classical economists -- the notion that if people do not spend their money in one way they will spend it in another.
And that is exactly what we are seeing right this very second.
You didn't spend the money on the XBox 360 game, but that's only because you already spent it on gasoline or food.
So, yes, people will spend money one way or another.
I'm sure you'll provide reams of evidence showing that Americans save money, right?
Wrong.
Quote:
Originally Posted by MTAtech
And as Keynes said, this misguided notion derives its plausibility from its superficial resemblance to the accounting identity which says that total spending must equal total income.
And, again, that is exactly what we've been seeing for decades. Americans spend every single penny they earn, and then spend money they don't have using their HELOCs and credit cards.
Quote:
Originally Posted by MTAtech
The argument that deficit spending by the government cannot raise income also implies that spending by a private business cannot raise income either.
Total Fail:
I spend money on machinery and expanded facilities. That allows me to do two things: operate at the optimum Economy of Scale and lower my production costs. That increases my profit margin, ie income, and I can then boost income further by lowering the price slightly to increase sales matching my Economy of Scale.
Total Fail Part Deux:
I spend money to purchase a raw materials facility, and now I obtain my raw materials at Cost, instead of Cost + Margin. That increases my income, because my production costs are lowered and my profit margin rises.
The reason that deficit spending by government does not raise income is because it does nothing to improve Economy of Scale or lower production costs or other input costs.
A family can spend money and increase their disposable income. They can purchase a more efficient furnace to heat their home, and save money that ultimately pays for the cost of the furnace and increases their disposable income.
A person can spend money to increase their education or skills to earn more money.
Your knowledge of Economics is so poor you shouldn't be allowed within 1,000 meters of an ATM.
Quote:
Originally Posted by MTAtech
So, when the federal government makes expenditures, it fills the hole in demand that's causing unemployment -- creating a need for those unemployed workers...
If and only if government spending targets those sectors of the economy where unemployment is highest, and that's not happening, and in a consumer-based economy, it isn't going to happen.
Just the THREAT of increased taxes is enough to keep modern American business in a permanent "hold" pattern. And it's not like American business taxes are low today in general (although our political system allows special deals for political contributions): "America's top corporate tax rate — 35 percent — is the second highest in the world...a study released by the Business Roundtable last week showed that even when those tax breaks are factored in, corporate taxes here are the sixth-highest in the world" (same source as above).
With all due respect, that's a preposterous assertion because it doesn't pass the logic test. First, you compare tax-rates, not the real taxes corporations pay.
Second, there is no evidence that businesses are in a "hold" pattern because they have high taxes to pay? Effective taxes are among the lowest in history. They were vastly higher under Eisenhower and somehow businesses where able to stay in business and pay their taxes.
A couple of weeks ago, I discussed the low level of federal taxes as a share of the gross domestic product in the United States, both historically and in comparison with other developed economies. I noted that total federal revenue — income, corporate and payroll taxes combined –– has been below 15 percent of gross domestic product for three years in a row, its lowest level since 1950 and well below the postwar average of about 18.5 percent of G.D.P.
...
Nevertheless, it is clear that federal taxes have not been rising and are, at least in historical terms, lower for most taxpayers than they have been since the 1960s. Those who assert that taxes are rising or are at confiscatory levels simply do not know what they are talking about.
Then, let's look at the FACTS. Businesses are experiencing record profit and the stock market is twice as high as when Bush left office.
Then there is the pure illogic of your contention. Businesses that lose money don't pay taxes -- so to contend that high taxes are making them unprofitable is backwards reasoning. Taxes are only paid on profits. If the company was profitable, and if it had to pay the highest statutory tax, they'd still keep 65% of their profit. No profitable business needs to close because of taxes and no unprofitable businesses pays taxes. So how, exactly, are taxes driving businesses out-of-business?
People who want to lower taxes - do you care about that America is being crushed by debt? Do you?!!?
I'm really tired of hearing this argument.
The United States is the #2 taxed nation in the world. If you want to raise government capital then close the loopholes that huge corporations hide behind and stop subsidies. GE paid fewer taxes last year than I did. They also received billions in subsidies. All you want to do is punish the wealthy for figuring out how to work within an already brutal system of taxation. Shame on them for being successful, and shame on you for perpetuating such a silly notion.
How about the 42% who didn't pay a dime in taxes and are probably on some form of entitlement?
The only thing raising taxes will do is feed the politicians' addiction to spend beyond our means. Stop frivolous spending and we will be debt free in ten years.
our plan??? it has been YOUR side's plan for the last 30 years. The name of the plan is called, "starve the beast" and was part of reagun's trickle down economics.
Now post a chart showing which party had control of Congress during the last 30 years.
The Reagan trickle down economics led to a very prosperous 1980s decade.
Now post a chart showing which party had control of Congress during the last 30 years.
The Reagan trickle down economics led to a very prosperous 1980s decade.
We don't need a chart, just fingers. Eight years
In the last 60 years conservatives have had control just 14 years. Democrats have spent us into oblivion for decades. The new Reps weren't even in their seats a month before Dems were screaming about how they caused all the problems. They couldn't wait to offload blame, and it wasn't even a surprise. They'll be blaming Bush forever, regardless of how badly they fail. Look around, read the threads, it's happening right now THREE YEARS LATER.
Everyone's drinking their own brand of partisan Koolaid these days, and it's sad and scary.
In the last 60 years conservatives have had control just 14 years. Democrats have spent us into oblivion for decades. The new Reps weren't even in their seats a month before Dems were screaming about how they caused all the problems. They couldn't wait to offload blame, and it wasn't even a surprise. They'll be blaming Bush forever, regardless of how badly they fail. Look around, read the threads, it's happening right now THREE YEARS LATER.
Everyone's drinking their own brand of partisan Koolaid these days, and it's sad and scary.
You can use your fingers all you want but the debts that Republicans complain about were mostly cause under Republican rule. Yes, in 60 years Republicans only had control of the house for 14. When Carter left office, the debt was $1 trillion. 12 years of Reagan and Bush1 the debt was $5 trillion. Bush2 alone increased the debt by $5 trillion with a Republican Pres., House and Senate:
Now, the Republicans complain about the debt which their party was mostly responsible.
You can use your fingers all you want but the debts that Republicans complain about were mostly cause under Republican rule. Yes, in 60 years Republicans only had control of the house for 14. When Carter left office, the debt was $1 trillion. 12 years of Reagan and Bush1 the debt was $5 trillion. Bush2 alone increased the debt by $5 trillion with a Republican Pres., House and Senate:
Now, the Republicans complain about the debt which their party was mostly responsible.
You do realize that Reagan, GH Bush and GW Bush didn't have full control of Congress during the entirety of their tenure... right?
Your chart should read Presidents, who couldn't get anything passed because their bills were held hostage by Democratic houses, and then were held to blame. You just admitted that Republicans had control of the house only 14 years in the last 60 and then displayed 20 years of Republican Presidents in the last 30, as if they controlled the house during their tenure. And they say Dems can't do the math...
Let's not forget that Republicans authored the Contract with America which salvaged Clintons' Presidency, and he took full credit for it. His surplus was also enhanced by the Internet boom (remember Gore? he invented the internet) paired with less spending.
Obama had a super majority for two years. He's out spent Bushs' eight years in just three years. Unemployment is sitting at 17%, not the 9.1% created through the use of accounting tricks that would get anyone else thrown into jail. We tax corporations at the 2nd highest rate in the world, yet corporations who are friends of Obama (picking winners) don't pay a dime. We are being regulated into a third world country as we are forced to export our resources rather than using them here.
It keeps going on for days how back asswards our country has become. However, you go right on ahead and stand up for your guy, even knowing you're wrong.
How's that change doing for ya?
Last edited by steven_h; 06-21-2011 at 10:29 PM..
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