# Taxes, Spending, the Fiscal Cliff, and Austerity



## Wiseacre

In this thread I want to talk about these things;  what has Europe done and how did it work, and what we should do with our own fiscal problems.   Someone wanted to know how I got the idea that various European countries have raised taxes more than they cut spending, so let's start with that.   

Below is a chart done by Veronique De Rugy from the Mercatus Center, but I found it at the Cato.org website.   Note that taxes outpaced spending cuts by a factor of 9 euros to 1.   And many of those spending cuts were really reductions in spending increases.   The tax hikes were not just to the upper crust;  middle incomes got hit too in some places, as well as higher VAT taxes that everyone pays and taxes on cigarettes, alcohol, fuel, and property taxes, and other things too.

European Politicians Share Obama

Here's the problem:   this approach has not worked.   The snippet below is looking at the question of which hurts an economy more, a tax increase or spending cuts.

Over at EconLog, George Mason University&#8217;s Garett Jones provides the answer: Tax increases. He looks at an IMF paper, often used by anti-spending cuts advocates to say that spending cuts hurt the economy, to show that actually fiscal adjustment based mostly on tax increases will hurt the economy the most. Here is Jones:

Quick summary of the method: The economists looked at 173 &#8220;fiscal consolidations&#8221; in rich countries, times when governments decided to reduce the long-run deficit. They then checked to see whether consolidations based mostly on tax hikes turned out better or worse than ones based on spending cuts (Inside baseball: They followed a version of the Romer and Romer event study methodology, but applied it to exogenous-looking fiscal tightening instead of exogenous-looking monetary tightening). . . .
Both GDP and consumer spending tell the same story: Spending cuts are the less painful path to fiscal rectitude. When countries tried to get right with the bond markets, this IMF study found that nations that mostly raised taxes suffered about twice as much as nations that mostly cut spending. 

This is consistent with a new paper called &#8220;The Design of Fiscal Adjustments,&#8221; by Harvard economists Alberto Alesina and Silvia Ardagna. Building up on their previous work, they provide even more evidence that fiscal consolidations based mostly on the spending side result in smaller recessions, or none at all, when compared to tax-based adjustments. Additionally, they find that private investment tends to react more positively to spending-based adjustments. Thus, they argue that spending cuts are more sustainable and effective in reducing debt and raising economic growth; expansionary fiscal consolidation is possible. 


Which Hurts More, Tax Increases or Spending Cuts? - By Veronique de Rugy - The Corner - National Review Online


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## Wiseacre

So you ask, what does this have to do with our fiscal cliff?   Well, the president is asking for tax hikes and the republicans are asking for spending cuts.   Hard to say what we'll end up with, but I'm pretty sure it'll be weighted more to the tax hike side than the spending cut side.   In a recent article appearing the USAToday by Matthew Melchiorre of the Competitive Enterprise Institute, the current fiscal cliff as it is now calls for 4 times the amount of tax increases than spending cuts.

snippet:

Beginning next year, $136 billion of spending cuts are scheduled to take place according to the Congressional Budget Office (CBO). These include the mandatory sequestration of defense and discretionary spending resulting from the failure of last year's bipartisan "supercomittee" to agree on a 10-year plan to cut the federal budget by $1.5 trillion. They also include the end of unemployment benefit extensions and reductions in Medicare reimbursement rates. Keep in mind these aren't real cuts in overall government spending, but merely reductions in its rate of growth.

They are also trivial compared to the $532 billion of scheduled tax increases that CBO also reports. Most of this comes from income tax rates reverting back to pre-2001 levels and the alternative minimum tax expanding deeply into middle-class households. That's roughly four dollars of tax increases for every one dollar of so-called spending cuts.

Column: America must avoid Europe's toxic tax remedy

It is true that significant spending cuts will hurt short term.   But it needs to be done, the big deficit drivers are defense, medicare and medicaid, and social security.   These programs must be reined in to be sustainable not just for the seniors who need them now but also for younger generations who will need them later.   Combine that with tax reform that increases revenue and a cap on gov't spending and we're in business.   I think this is Obama's big chance to make his mark in American history;  if he can lead us to reasonable and workable solutions that will succeed long term, he could go down as one of our best presidents.   If he doesn't, he'll take his place next to Jimmy Carter.


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## jwoodie

This debate is like arguing about what procedures would have saved the Titanic (hint: none).  Demographics are overwhelming every quasi-socialist country, and we are joining that list.  Private sector job growth (and inflation) is the only available solution.  The rest is pure sophistry.


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## Old Rocks

Clinton raised taxes on the rich in '92. And the economy cratered, right? Not quite. Longest sustained economic boom in our naton's history. 

Then Bushie Baby cut taxes, while engaged in two wars. And the economy did great, right? LOL. 16 trillion in homeowners value and 401Ks lost in two years, from 2007 to 2009.

So, what are we to believe? Recent history or rightwing ideology?


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## WillowTree

jwoodie said:


> This debate is like arguing about what procedures would have saved the Titanic (hint: none).  Demographics are overwhelming every quasi-socialist country, and we are joining that list.  Private sector job growth (and inflation) is the only available solution.  The rest is pure sophistry.



The dishonesty of the left is the major tombstone in the cemetary too.


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## WillowTree

Old Rocks said:


> Clinton raised taxes on the rich in '92. And the economy cratered, right? Not quite. Longest sustained economic boom in our naton's history.
> 
> Then Bushie Baby cut taxes, while engaged in two wars. And the economy did great, right? LOL. 16 trillion in homeowners value and 401Ks lost in two years, from 2007 to 2009.
> 
> So, what are we to believe? Recent history or rightwing ideology?



So if you want to go to the Clinton era tax levels are you willing to go with the Clinton spending cuts too? Yes? or NO?


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## oldfart

Wiseacre said:


> In this thread I want to talk about these things;  what has Europe done and how did it work, and what we should do with our own fiscal problems.   Someone wanted to know how I got the idea that various European countries have raised taxes more than they cut spending, so let's start with that.


You cover a lot of ground in this post, and I think by the time I think it all through and do the neded research, it might be Janaury.  So I'll take points one at a time.  



Wiseacre said:


> Below is a chart done by Veronique De Rugy from the Mercatus Center, but I found it at the Cato.org website.   Note that taxes outpaced spending cuts by a factor of 9 euros to 1.   And many of those spending cuts were really reductions in spending increases.   The tax hikes were not just to the upper crust;  middle incomes got hit too in some places, as well as higher VAT taxes that everyone pays and taxes on cigarettes, alcohol, fuel, and property taxes, and other things too.


I went to the Cato Institute website and this is apparently a paper delivered in a symposium but not made available on the website.    The graphic you used from her presentation is indeed startling.  My problem is that I cannot find anything that shows how the numbers were derived, nor could I find a database that clearly would either confirm or debunk it.  The Cato Institute has an agenda, which does not mean than any research they use is wrong, but it does mean it's good to check out their numbers.  

I spent about three hours looking at databases and apparently if anybody is breaking down austerity plans into revenue and spending components, I haven't found it.  The 9:1 ratio, however strains credulity.  All the descriptons of austerity programs in Greece, Italy, Spain, and Britain mention both broadly based tax increases (especially the VAT, taxes on "luxuries" and import taxes) and spending cuts (most frequently in government pensions, wages of government workers, and  reduced subsidies to state enterprises).  

So for now I believe that the role of tax measures is probably less than stated, that you are correct tha many of these taxes fall very broadly and some are regressive, and that austerity in atleast southern Europe has definitely involved direct cuts in many workers income.


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## Wiseacre

oldfart said:


> Wiseacre said:
> 
> 
> 
> In this thread I want to talk about these things;  what has Europe done and how did it work, and what we should do with our own fiscal problems.   Someone wanted to know how I got the idea that various European countries have raised taxes more than they cut spending, so let's start with that.
> 
> 
> 
> You cover a lot of ground in this post, and I think by the time I think it all through and do the neded research, it might be Janaury.  So I'll take points one at a time.
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> Below is a chart done by Veronique De Rugy from the Mercatus Center, but I found it at the Cato.org website.   Note that taxes outpaced spending cuts by a factor of 9 euros to 1.   And many of those spending cuts were really reductions in spending increases.   The tax hikes were not just to the upper crust;  middle incomes got hit too in some places, as well as higher VAT taxes that everyone pays and taxes on cigarettes, alcohol, fuel, and property taxes, and other things too.
> 
> Click to expand...
> 
> I went to the Cato Institute website and this is apparently a paper delivered in a symposium but not made available on the website.    The graphic you used from her presentation is indeed startling.  My problem is that I cannot find anything that shows how the numbers were derived, nor could I find a database that clearly would either confirm or debunk it.  The Cato Institute has an agenda, which does not mean than any research they use is wrong, but it does mean it's good to check out their numbers.
> 
> I spent about three hours looking at databases and apparently if anybody is breaking down austerity plans into revenue and spending components, I haven't found it.  The 9:1 ratio, however strains credulity.  All the descriptons of austerity programs in Greece, Italy, Spain, and Britain mention both broadly based tax increases (especially the VAT, taxes on "luxuries" and import taxes) and spending cuts (most frequently in government pensions, wages of government workers, and  reduced subsidies to state enterprises).
> 
> So for now I believe that the role of tax measures is probably less than stated, that you are correct tha many of these taxes fall very broadly and some are regressive, and that austerity in atleast southern Europe has definitely involved direct cuts in many workers income.
Click to expand...


I could not find anything to substantiate the 9:1 ratio, nor could I find any competing numbers from anywhere else.   I do know that there are/were many proposed spending cuts over there that never actually went into effect or got reduced or removed when the ruckus got too severe.   Pretty sure most of the tax cuts survived though.   Most liberal sources decry austerity but don't give you any details, so it's difficult to know what the real numbers are.   

Whatever the true ratio is, I think it's safe to say that tax hikes have been the major part of the various european austerity measures.   There are studies that show that approach is generally unsuccessful, primarily because when you raise taxes you stunt economic growth.   Consider the following snippet from an article written again by de Rugy:

" The balanced approach has proven a recipe for disaster. In a 2009 paper, Harvard University's Alberto Alesina and Silvia Ardagna looked at 107 attempts to reduce the ratio of debt to gross domestic product over 30 years in countries in the OECD. They found fiscal adjustments consisting of both tax increases and spending cuts generally failed to stabilize the debt and were also more likely to cause economic contractions. On the other hand, successful austerity packages resulted from making spending cuts without tax increases. They also found this form of austerity is more likely associated with economic expansion rather than with recession.

While the balanced approach may give the appearance of pursuing fiscal solvency, in practice it stagnates the possibility of growth. Real fiscal reform comes from a commitment to cut spending and from structural changes to taxation and the regulatory environment. "

Austerity By the Numbers | Mercatus

One can dispute whatever de Rugy writes, but she didn't have anything to do with the paper by the two Harvard professors.


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## JQPublic1

Wiseacre said:


> Column: America must avoid Europe's toxic tax remedy
> 
> It is true that significant spending cuts will hurt short term.   But it needs to be done, the big deficit drivers are defense, medicare and medicaid, and social security.   These programs must be reined in to be sustainable not just for the seniors who need them now but also for younger generations who will need them later.   Combine that with tax reform that increases revenue and a cap on gov't spending and we're in business.




Don't include social security on your list of deficit drivers. That programs is funded separately through payroll taxes and has  nothing to do with the Federal deficit! Don't take my word for it, listen to this live interview from the right wing guru himself, Ronald Reagan!

Ronald Reagan: Social Security has nothing to do with the deficit. | MoveOn.Org



Wiseacre said:


> I think this is Obama's big chance to make his mark in American history;  if he can lead us to reasonable and workable solutions that will succeed long term, he could go down as one of our best presidents.   If he doesn't, he'll take his place next to Jimmy Carter.



If he messes with social security  the consequences might be far more serious than anything that happened to Jimmy Carter. I am not a Reagan fan but in this instance I hope Obama is as informed as Reagan on  social security and leaves it off the deficit  reduction negotiation table. Medicare  is also funded by payroll taxes but so-called Obamacare could offer better coverage with lower premiums. 

BTW, Obama has already surpassed anything Carter did or, for that matter, most of the other presidents! As a two term president he should never be compared to Jimmy Carter again!


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## Wiseacre

JQPublic1 said:


> Wiseacre said:
> 
> 
> 
> Column: America must avoid Europe's toxic tax remedy
> 
> It is true that significant spending cuts will hurt short term.   But it needs to be done, the big deficit drivers are defense, medicare and medicaid, and social security.   These programs must be reined in to be sustainable not just for the seniors who need them now but also for younger generations who will need them later.   Combine that with tax reform that increases revenue and a cap on gov't spending and we're in business.
> 
> 
> 
> 
> 
> Don't include social security on your list of deficit drivers. That programs is funded separately through payroll taxes and has  nothing to do with the Federal deficit! Don't take my word for it, listen to this live interview from the right wing guru himself, Ronald Reagan!
> 
> Ronald Reagan: Social Security has nothing to do with the deficit. | MoveOn.Org
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> I think this is Obama's big chance to make his mark in American history;  if he can lead us to reasonable and workable solutions that will succeed long term, he could go down as one of our best presidents.   If he doesn't, he'll take his place next to Jimmy Carter.
> 
> Click to expand...
> 
> 
> If he messes with social security  the consequences might be far more serious than anything that happened to Jimmy Carter. I am not a Reagan fan but in this instance I hope Obama is as informed as Reagan on  social security and leaves it off the deficit  reduction negotiation table. Medicare  is also funded by payroll taxes but so-called Obamacare could offer better coverage with lower premiums.
> 
> BTW, Obama has already surpassed anything Carter did or, for that matter, most of the other presidents! As a two term president he should never be compared to Jimmy Carter again!
Click to expand...


Re Social Security, you do know that things have changed in the last 30 years, right?   The trustees who are responsible for managing and overseeing the SSA fund have said the program will not be solvent in another 20 years or so, I forget the most recent estimate.   Talk to people in the 20s and 30s, many of them don't believe the system will be there for them when they retire.   And for good reason, these days the SSA is paying out more than they are taking in, as we've got more old guys retiring than new guys coming into the workforce.   We've got like 3 workers paying for one retiree's benefits, and it could drop to 2 for 1.   I see no reason why we can't raise the minimum age for collecting benefits for those who are at least 10 years away from retirement.   Or whatever solution the pols come up with, but something must be done to make the SSA sustainable and restore confidence in it.


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## JQPublic1

Wiseacre said:


> Re Social Security, you do know that things have changed in the last 30 years, right?



Well... umm, NO! Social Security STILL has nothing to do with the federal deficit. That fact has NOT changed, nor has the funding for it through payroll taxes!



Wiseacre said:


> The trustees who are responsible for managing and overseeing the SSA fund have said the program will not be solvent in another 20 years or so, I forget the most recent estimate.   Talk to people in the 20s and 30s, many of them don't believe the system will be there for them when they retire.   And for good reason, these days the SSA is paying out more than they are taking in, as we've got more old guys retiring than new guys coming into the workforce.   We've got like 3 workers paying for one retiree's benefits, and it could drop to 2 for 1.   I see no reason why we can't raise the minimum age for collecting benefits for those who are at least 10 years away from retirement.   Or whatever solution the pols come up with, but something must be done to make the SSA sustainable and restore confidence in it.



Great dodge but no cigar! We were talking about deficit reduction and you included social security as one of the programs that should be put on the table in reducing it. That was just plain wrong. BTW thanks for serving!


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## auditor0007

Old Rocks said:


> Clinton raised taxes on the rich in '92. And the economy cratered, right? Not quite. Longest sustained economic boom in our naton's history.
> 
> Then Bushie Baby cut taxes, while engaged in two wars. And the economy did great, right? LOL. 16 trillion in homeowners value and 401Ks lost in two years, from 2007 to 2009.
> 
> So, what are we to believe? Recent history or rightwing ideology?



There are so many problems when looking at this from any perspective.  First off, there is some merit to the idea that raising taxes will hurt more than help, at least in the short term.  The problem is that we have gotten ourselves into a severe pickle because we have used tax cuts over the past decade plus as a way to stimulate the economy.  Problem is, the tax cuts only helped in short stints, but in the long run, it did nothing.  We can't cut taxes any further to stimulate the economy because revenue has hit rock bottom due to the already low tax rates.  

So what about spending?  Well, we could cut some here and there, but nobody can agree where to cut.  In the end, there is not going to be a simple solution, and this storm is going to be with us for some time; we're going to just have to ride it out.  My thoughts are that we end the payroll tax cut, and raise the tax rate on anyone making over $100,000 per year.  The rate increase does not need to be massive.  Secondly, raise the tax rate on capital gains to 20% with the idea of raising it higher once the economy gets rolling again, if necessary.  As for cuts, the easiest way to cut spending is to freeze it across the board, other than for SS and Medicare.  As for the long term, SS and Medicare spending must be reduced in comparison to what we are expecting to pay out.  We can't cut spending on those programs because we have more and more people retiring.  What we can do is raise the retirement age gradually for everyone until we hit a point where revenue and payouts are close to being balanced for the long term.

One thing nobody thinks about is that if we do what needs to be done to get spending under control, even if it is done slowly, the economy is going to pick up eventually.  There are two factors to look at that have nothing to do with politicians, taxation, or government spending.  The baby boomers are all retiring.  Even if they haven't retired yet, they are downsizing and not spending as much money anymore.  This wouldn't be such a problem but for the fact that their kids have delayed starting their own families.  While there are reasons for this, mostly economic, they are starting to hit the age where they have to begin getting married and having kids.  My thought is that within the next ten years, we are going to see a boom in child births which will lead to a lot of younger people needing to buy homes and bigger cars.  The spending cycle will kick into high gear once again, and then we will see things improve dramatically.


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## Wiseacre

JQPublic1 said:


> Wiseacre said:
> 
> 
> 
> Re Social Security, you do know that things have changed in the last 30 years, right?
> 
> 
> 
> 
> Well... umm, NO! Social Security STILL has nothing to do with the federal deficit. That fact has NOT changed, nor has the funding for it through payroll taxes!
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> The trustees who are responsible for managing and overseeing the SSA fund have said the program will not be solvent in another 20 years or so, I forget the most recent estimate.   Talk to people in the 20s and 30s, many of them don't believe the system will be there for them when they retire.   And for good reason, these days the SSA is paying out more than they are taking in, as we've got more old guys retiring than new guys coming into the workforce.   We've got like 3 workers paying for one retiree's benefits, and it could drop to 2 for 1.   I see no reason why we can't raise the minimum age for collecting benefits for those who are at least 10 years away from retirement.   Or whatever solution the pols come up with, but something must be done to make the SSA sustainable and restore confidence in it.
> 
> Click to expand...
> 
> 
> Great dodge but no cigar! We were talking about deficit reduction and you included social security as one of the programs that should be put on the table in reducing it. That was just plain wrong. BTW thanks for serving!
Click to expand...


You're welcome.   SS spends more in benefits than it takes in as income.   The problem will worsen over time.   Sounds like a deficit to me.


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## catatomic

Hello Everybody.

This problem being discussed here has been in my heart lately.

I suggest the best source of information is the Congressional Budget Office itself.  It is nonpartisan and made to help the government know the consequences of actions.

Let me just state facts, from the panel on the website about the fiscal cliff.  If we extend tax cuts, GDP might go up by about 2%, but we'd end up being poorer later on as the debt catches up to us.

If we go off the so-called cliff, unemployment rate would rise by 1%, we'd pay down the debt too, but it would also go down to an unemployment rate of about 5% later.

Spending cuts are twice as effective as Tax increases.

Well, be happy.  We have some good choices that everyone can make.


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## JQPublic1

Wiseacre said:


> JQPublic1 said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> Re Social Security, you do know that things have changed in the last 30 years, right?
> 
> 
> 
> 
> Well... umm, NO! Social Security STILL has nothing to do with the federal deficit. That fact has NOT changed, nor has the funding for it through payroll taxes!
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> The trustees who are responsible for managing and overseeing the SSA fund have said the program will not be solvent in another 20 years or so, I forget the most recent estimate.   Talk to people in the 20s and 30s, many of them don't believe the system will be there for them when they retire.   And for good reason, these days the SSA is paying out more than they are taking in, as we've got more old guys retiring than new guys coming into the workforce.   We've got like 3 workers paying for one retiree's benefits, and it could drop to 2 for 1.   I see no reason why we can't raise the minimum age for collecting benefits for those who are at least 10 years away from retirement.   Or whatever solution the pols come up with, but something must be done to make the SSA sustainable and restore confidence in it.
> 
> Click to expand...
> 
> 
> Great dodge but no cigar! We were talking about deficit reduction and you included social security as one of the programs that should be put on the table in reducing it. That was just plain wrong. BTW thanks for serving!
> 
> Click to expand...
> 
> 
> You're welcome.   SS spends more in benefits than it takes in as income.   The problem will worsen over time.   Sounds like a deficit to me.
Click to expand...


Well Sarge, If you can't agree with your former Commander in Chief,  president Reagan, there is nothing  I can do  to convince you that SS has nothing to do with the national deficit. The future of SS may need to be addressed but that debate ought not to be mixed up with debates about the national deficit. Keep em separate.


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## oldfart

catatomic said:


> I suggest the best source of information is the Congressional Budget Office itself.  .



For full wonk status you need to round out your reading list with:

U.S. Bureau of Labor Statistics for employment data and price indicies

CIA World Factbook for international economic data

U.S. Bureau of Economic Analysis (BEA) Dept of Commerce statistics

Federal Reserve Economic Data - FRED - St. Louis Fed  Just about everything

Anybody got any other can't miss websites?


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## JQPublic1

JQPublic1 said:


> Well Sarge, If you can't agree with your former Commander in Chief,  president Reagan, there is nothing  I can do  to convince you that SS has nothing to do with the national deficit. The future of SS may need to be addressed but that debate ought not to be mixed up with debates about the national deficit. Keep em separate.



As an after thought, I see why  you might see a nexus between SS and the national deficit.
It has been widely reported that Congress has borrowed extensively from the SS trust fund to finance other programs. If so, that money has to be paid back as it belongs to the SS trust fund. Perhaps that IOU, if indeed it exists at all, would represent a connection to the national deficit. However, that paradigm puts the onus  on the recipients who paid into it to have their benefits lowered because of looming insolvency caused by congress's borrowing from it, NOT  an increase in recipients! That is out right thievery.  If the foregoing is true, that part of the national deficit should be the first to be paid. Anything less is unacceptable.


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## Wiseacre

JQPublic1 said:


> Wiseacre said:
> 
> 
> 
> 
> 
> JQPublic1 said:
> 
> 
> 
> Well... umm, NO! Social Security STILL has nothing to do with the federal deficit. That fact has NOT changed, nor has the funding for it through payroll taxes!
> 
> 
> 
> Great dodge but no cigar! We were talking about deficit reduction and you included social security as one of the programs that should be put on the table in reducing it. That was just plain wrong. BTW thanks for serving!
> 
> 
> 
> 
> You're welcome.   SS spends more in benefits than it takes in as income.   The problem will worsen over time.   Sounds like a deficit to me.
> 
> Click to expand...
> 
> 
> Well Sarge, If you can't agree with your former Commander in Chief,  president Reagan, there is nothing  I can do  to convince you that SS has nothing to do with the national deficit. The future of SS may need to be addressed but that debate ought not to be mixed up with debates about the national deficit. Keep em separate.
Click to expand...



I'll take another stab at it, just for the heck of it.  Up until the last few few years the SS Trust fund has always taken in more than it pays out.   By law, that surplus goes into the US Treasury's general account for virtually everything else we spend money on.   The SS Trust Fund gets an IOU, which essentilly means the Treasury will cover any deficits up to the total amount of IOUs.   After that, the SS Trust Fund becomes insolvent.   

Here's the deal:  When the Treasury has to make good on those IOUs, we have to borrow money from somebody for the transfer.   I don't care how you spin it, that is a deficit.   It isn't on par with the other big ticket spending programs, but I think it's unwise to wait until all the IOUs are gone before we address the problem.


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## catatomic

oldfart said:


> catatomic said:
> 
> 
> 
> I suggest the best source of information is the Congressional Budget Office itself.  .
> 
> 
> 
> 
> For full wonk status you need to round out your reading list with:
> 
> Anybody got any other can't miss websites?
Click to expand...


Thank you.  I love bea.gov, and I really like the last one.  Currently GDP is at 2.7% for the third quarter of 2012.


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## oldfart

Wiseacre said:


> [I'll take another stab at it, just for the heck of it.  Up until the last few few years the SS Trust fund has always taken in more than it pays out.   By law, that surplus goes into the US Treasury's general account for virtually everything else we spend money on.   The SS Trust Fund gets an IOU, which essentilly means the Treasury will cover any deficits up to the total amount of IOUs.   After that, the SS Trust Fund becomes insolvent.
> 
> Here's the deal:  When the Treasury has to make good on those IOUs, we have to borrow money from somebody for the transfer.   I don't care how you spin it, that is a deficit.   It isn't on par with the other big ticket spending programs, but I think it's unwise to wait until all the IOUs are gone before we address the problem.



I have a bit different take on it.  No society in the long run can consume much more than it produces.  When it tries to provide for the future in financial markets (people save and buy bonds) what the result will be really depends on what the bond issuers do with the money.  Suppose the government of Beckystan is worried about providing for an aging population.  It raises money by marketing retirement bonds to its citizens.  It uses the money to build medical schools, train medical personnel, encourage housing adaptable for conversion to wheel-chair accessibility, zoning and public transportation with an aging population in mind and so forth.  When in fifteen years the public begins to redeem the bonds, the government can raise taxes or borrow the money.  But the curcial point is that the supply of physical and human capital needed to support the aging population IS ALREADY IN  PLACE.  If the Beckystan government had invested in an unsuccessful war with its neighbors over water rights, there would be nothing to show for it, the government would still be confronted with the problem of bond redemptions, but when it redeemed the bonds the main effect would be inflation in the price of all those goods and services needed by the aging population.  This is what I am afraid we are doing.  

You are correct that when the current accounts surplus of Social Security was invested in Treasury bonds, that excess de facto became available to support spending.  If we got into a bunch of expensive wars and let our infrastructure and research capability deteriorate, (which we did) we are up shit creek without a diaper.  Had we made public investments rather than "give back" revenue in the form of tax cuts, we would be better off.  There ain't no such thing as a free lunch.  That applies to government functions as well.  If the idea is that the private sector does a marvelous job, much better than the public sector, and that by restraining government spending the private sector would magically do the proper infrastructure and long-term growth investing for us, you can blame all of Interstate bridges that fall into the Mississippi River on Goldman Sachs.  A sane society would blame it on magical thinking.  Markets are not designed to handle social investment (defined as investment with large portions of positive externalities) and they suck at it.


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## JQPublic1

Wiseacre said:


> I'll take another stab at it, just for the heck of it.  Up until the last few few years the SS Trust fund has always taken in more than it pays out.



I don't think that is true! That yarn has been around for more than a few years. What you are echoing is the spin posited by extreme right wingers who have been trying to destroy Social Security since its inception. Fortunately, not all Republicans are extreme right wingers bent on gutting social safety nets. Ronald Reagan exemplified the latter with the speech to which I linked  in a previous post. And why do you suppose that speech was necessary? Obviously, Reagan was reacting to the same kind of thinking  represented in your quote above.




Wiseacre said:


> By law, that surplus goes into the US Treasury's general account for virtually everything else we spend money on.



No,   there is no law that provides for an interchange of money between the general fund and the SS trust funds. Any  SS surplus would properly be credited to the SS funds. If  inter fund transactions occurred, the pubic was never informed about them. Frankly, though, I am not sure if any money was borrowed from the SS funds at all. I have seen some congressmen subscribe to the borrowing thesis while others say it ain't so. Perhaps the CBO is the best authority to address that particular question but  evan a visit to their website doesn't clear up the controversy.

Technically,  considering  the  statistical projections showing an enormous increase in  future recipients, there never could have been a surplus.




Wiseacre said:


> The SS Trust Fund gets an IOU, which essentilly means the Treasury will cover any deficits up to the total amount of IOUs.   After that, the SS Trust Fund becomes insolvent.



Again, you are speaking from the heart and not from hard verifiable facts. Your statement here is a non sequitur that really makes little sense. Congress allegedly raided the SS Trust Funds for reasons we can only guess at
In doing so, they incurred another debt that has to be repaid. Any looming insolvency is likely tied to that congressional pilferage rather than the increasing number of recipients who paid into the program all their working lives. 



Wiseacre said:


> I don't care how you spin it, that is a deficit.   It isn't on par with the other big ticket spending programs, but I think it's unwise to wait until all the IOUs are gone before we address the problem.



Sorry, but addressing the problem doesn't mean we should put Social Security on the table. None of the other debtors holding IOUs, including China and other foreign entities, are going to be denied repayment at nominal interest rates so why do you want to deny or reduce the SS benefits of Americans who worked for them by screwing  with their safety nets?

Now that you and I suspect that Congress borrowed from the SS fund to finance other government programs, do you really think it is right to put Social Security on the table as a bargaining chip to lower the national deficit?  I don't. In fact, the obligation to pay off the national deficit has never been questioned.
Our top priority should be to pay that money back so that all the people who paid into the ss fund for many years can get their due.




> Here's the deal:  When the Treasury has to make good on those IOUs, we have to borrow money from somebody for the transfer.



The entire National Deficit is an IOU! I don't hear anyone saying we should renege on any of that debt except in the case of the debt owed to the SS Funds. A better strategy would be to decrease spending associated with the general fund, to include defense allocations. Revenue generated by closing  tax loophole for the rich and letting the Bush tax cuts expire on the top 2% is another popular solution


 Revenue from any source  would do if the law allows it. But here is the "deal" as I see it: Social Security recipients should not have to worry about having their benefits cut or messed with because congress raided the SS fund. The money would be there otherwise and there should be no talk of putting SS on the table as a bargaining chip ! We already paid for it once and shouldn't have to pay for it again through reductions or cutting of any SS benefits!


----------



## PaulS1950

Even with the reduction in Social Security payment from employees this is the data from 2011:

$819 billion collected
$725 billion paid out
-------------------------
$ 94 billion reserve for the year of 2011

At no time has less been collected than has been paid out - where is the reserve going?
Every year the reserve that is supposed to be held in trust is spent to cover other costs of big government. 
The Feds will make sure that we go broke before they do - but it won't be long after.


----------



## Wiseacre

PaulS1950 said:


> Even with the reduction in Social Security payment from employees this is the data from 2011:
> 
> $819 billion collected
> $725 billion paid out
> -------------------------
> $ 94 billion reserve for the year of 2011
> 
> At no time has less been collected than has been paid out - where is the reserve going?
> Every year the reserve that is supposed to be held in trust is spent to cover other costs of big government.
> The Feds will make sure that we go broke before they do - but it won't be long after.




Where'd you get your numbers?

The following is from the Social Security Fund Trustees, I think I'll take their word over yours:

Social Securitys expenditures exceeded non-interest income in 2010 and 2011, the first such occurrences since 1983, and the Trustees estimate that these expenditures will remain greater than non-interest income throughout the 75-year projection period. The deficit of non-interest income relative to expenditures was about $49 billion in 2010 and $45 billion in 2011, and the Trustees project that it will average about $66 billion between 2012 and 2018 before rising steeply as the economy slows after the recovery is complete and the number of beneficiaries continues to grow at a substantially faster rate than the number of covered workers. Redemption of trust fund assets from the General Fund of the Treasury will provide the resources needed to offset the annual cash-flow deficits. Since these redemptions will be less than interest earnings through 2020, nominal trust fund balances will continue to grow. The trust fund ratio, which indicates the number of years of program cost that could be financed solely with current trust fund reserves, peaked in 2008, declined through 2011, and is expected to decline further in future years. After 2020, Treasury will redeem trust fund assets in amounts that exceed interest earnings until exhaustion of trust fund reserves in 2033, three years earlier than projected last year. Thereafter, tax income would be sufficient to pay only about three-quarters of scheduled benefits through 2086.

Trustees Report Summary


----------



## JQPublic1

Wiseacre said:


> PaulS1950 said:
> 
> 
> 
> Even with the reduction in Social Security payment from employees this is the data from 2011:
> 
> $819 billion collected
> $725 billion paid out
> -------------------------
> $ 94 billion reserve for the year of 2011
> 
> At no time has less been collected than has been paid out - where is the reserve going?
> Every year the reserve that is supposed to be held in trust is spent to cover other costs of big government.
> The Feds will make sure that we go broke before they do - but it won't be long after.
> 
> 
> 
> 
> 
> Where'd you get your numbers?
> 
> The following is from the Social Security Fund Trustees, I think I'll take their word over yours:
> 
> Social Securitys expenditures exceeded non-interest income in 2010 and 2011, the first such occurrences since 1983, and the Trustees estimate that these expenditures will remain greater than non-interest income throughout the 75-year projection period. The deficit of non-interest income relative to expenditures was about $49 billion in 2010 and $45 billion in 2011, and the Trustees project that it will average about $66 billion between 2012 and 2018 before rising steeply as the economy slows after the recovery is complete and the number of beneficiaries continues to grow at a substantially faster rate than the number of covered workers.Redemption of trust fund assets from the General Fund of the Treasury will provide the resources needed to offset the annual cash-flow deficits. Since these redemptions will be less than interest earnings through 2020, nominal trust fund balances will continue to grow . The trust fund ratio, which indicates the number of years of program cost that could be financed solely with current trust fund reserves, peaked in 2008, declined through 2011, and is expected to decline further in future years. After 2020, Treasury will redeem trust fund assets in amounts that exceed interest earnings until exhaustion of trust fund reserves in 2033, three years earlier than projected last year. Thereafter, tax income would be sufficient to pay only about three-quarters of scheduled benefits through 2086.
> 
> Trustees Report Summary
Click to expand...


After reading both posts it seems to me that both assessments could be correct. The legalese in the Trustees report is intended to mislead but doesn't really contradict Paul's source data. Here is why:

Use of terms like "non-interest income" shows an intentional effort to obfuscate the narrative for the casual reader. Then, to say that Social Security expenditures  exceeded "non-interest income" in 2010 and 2011, is particularly deceptive. Obviously, the combination of non-interest and interest income would have resulted in a different assessment, more in line with Paul's data.

Further, the red highlighted text above shows  in a round about way that Congress borrowed money from the SS funds and those loans are generating interest! Some SS fund asset are held in the General Fund as a result and that those funds will be redeemed as needed to offset the decline in current SS Fund assets on hand!
All in all, Paul's matrix is a simplification of one aspect of the SS Trustees report and is written plainly so that laymen can understand it!


----------



## Rozman

Can't we just spend more???
Like maybe a Stimulus plan or something?


----------



## Old Rocks

Rozman said:


> Can't we just spend more???
> Like maybe a Stimulus plan or something?



You know, the people presenting their information and viewpoints have been really educational. So why change the tenor of the conversation? How about posting something on the level the the rest of the posters have been doing?


----------



## Rozman

Old Rocks said:


> Rozman said:
> 
> 
> 
> Can't we just spend more???
> Like maybe a Stimulus plan or something?
> 
> 
> 
> 
> You know, the people presenting their information and viewpoints have been really educational. So why change the tenor of the conversation? How about posting something on the level the the rest of the posters have been doing?
Click to expand...


You are right and I apologize...
So in the spirit of the Obama administration I suggest....

We tax the living shit out of anything that moves and then spend like there's no tomorrow.

Because with this administration who knows how many we have left before we just post a sign....

*America...Going out of business sale...*


----------



## Wiseacre

JQPublic1 said:


> Wiseacre said:
> 
> 
> 
> 
> 
> PaulS1950 said:
> 
> 
> 
> Even with the reduction in Social Security payment from employees this is the data from 2011:
> 
> $819 billion collected
> $725 billion paid out
> -------------------------
> $ 94 billion reserve for the year of 2011
> 
> At no time has less been collected than has been paid out - where is the reserve going?
> Every year the reserve that is supposed to be held in trust is spent to cover other costs of big government.
> The Feds will make sure that we go broke before they do - but it won't be long after.
> 
> 
> 
> 
> 
> Where'd you get your numbers?
> 
> The following is from the Social Security Fund Trustees, I think I'll take their word over yours:
> 
> Social Securitys expenditures exceeded non-interest income in 2010 and 2011, the first such occurrences since 1983, and the Trustees estimate that these expenditures will remain greater than non-interest income throughout the 75-year projection period. The deficit of non-interest income relative to expenditures was about $49 billion in 2010 and $45 billion in 2011, and the Trustees project that it will average about $66 billion between 2012 and 2018 before rising steeply as the economy slows after the recovery is complete and the number of beneficiaries continues to grow at a substantially faster rate than the number of covered workers.Redemption of trust fund assets from the General Fund of the Treasury will provide the resources needed to offset the annual cash-flow deficits. Since these redemptions will be less than interest earnings through 2020, nominal trust fund balances will continue to grow . The trust fund ratio, which indicates the number of years of program cost that could be financed solely with current trust fund reserves, peaked in 2008, declined through 2011, and is expected to decline further in future years. After 2020, Treasury will redeem trust fund assets in amounts that exceed interest earnings until exhaustion of trust fund reserves in 2033, three years earlier than projected last year. Thereafter, tax income would be sufficient to pay only about three-quarters of scheduled benefits through 2086.
> 
> Trustees Report Summary
> 
> Click to expand...
> 
> 
> After reading both posts it seems to me that both assessments could be correct. The legalese in the Trustees report is intended to mislead but doesn't really contradict Paul's source data. Here is why:
> 
> Use of terms like "non-interest income" shows an intentional effort to obfuscate the narrative for the casual reader. Then, to say that Social Security expenditures  exceeded "non-interest income" in 2010 and 2011, is particularly deceptive. Obviously, the combination of non-interest and interest income would have resulted in a different assessment, more in line with Paul's data.
> 
> Further, the red highlighted text above shows  in a round about way that Congress borrowed money from the SS funds and those loans are generating interest! Some SS fund asset are held in the General Fund as a result and that those funds will be redeemed as needed to offset the decline in current SS Fund assets on hand!
> All in all, Paul's matrix is a simplification of one aspect of the SS Trustees report and is written plainly so that laymen can understand it!
Click to expand...


You (and Paul) are mistaken.  The SS Fund is taking in less than it is paying out, which is contrary to what Paul wrote.   Which was a shortfall on $45 billion in 2011, and it will continue to rise.   Steeply.   That money comes out of the US Treasury, we have to borrow from somebody (Chinese?) to pay that $45 billion.   Interest and non-interest don't mean squat, when the SSTF has a shortfall the federal gov't has to make good on it.


----------



## WillowTree

Rozman said:


> Can't we just spend more???
> Like maybe a Stimulus plan or something?



Certainly we can, because they will tell you in a hearbeat that THEY WON!


----------



## JQPublic1

Wiseacre said:


> You (and Paul) are mistaken.  The SS Fund is taking in less than it is paying out, which is contrary to what Paul wrote.   Which was a shortfall on $45 billion in 2011, and it will continue to rise.   Steeply.   That money comes out of the US Treasury, we have to borrow from somebody (Chinese?) to pay that $45 billion.   Interest and non-interest don't mean squat, when the SSTF has a shortfall the federal gov't has to make good on it.



I see the obfuscation found in the Trustees Report and I see the intended effect  it has on you, Sarge; and, that is unfortunate. *Interest and non interest income does mean "squat."* In fact, both types of income have to be included in determining the actual value of assets in the SS Trust Funds. To me, it is plain that the $45 Billion "shortfall" of which you speak is the difference between the money taken in through  payroll taxes and expenditures. That 45 Billion "shortfall" does not take into account the interest paid and principal owed to the SSTFs from the loans appropriated by Congress. Understanding that dynamic is crucial to understanding the Trustee Report.

I'm not sure that you read your own post when  you seem to ignore words  like "redemption" or "non interest" income. Those words are huge keys to navigating through the calculated morass seen in the Trustees Report.
I respectfully solicit your response to the following  snippets from your Trustee Report:




> Redemption of trust fund assets from the General Fund of the Treasury will provide the resources needed to offset the annual cash-flow deficits


.

What do you think the phrase "redemption of Trust Fund assets from the General Fund" means here? It is a reference to the principal loan amount owed to the SSTF. You can only redeem something that has been taken away or borrowed. The annual cash flow deficits mentioned  in the report( represented by the 45 Billion figure in 2011) is the difference between non interest income and expenditures;i.e. payroll taxes vs money paid to recipients.  The word "deficit" here does not take into account interest payments or the principal on loans owed to the SSTFs by the General Fund.




> Since these redemptions will be less than interest earnings through 2020, nominal trust fund balances will continue to grow


. 

Can you explain why the SSTF balances will continue to grow through 2020? In plain language, the principal of the loan is what interest is based on.  According to the above statement ,redemptions ( money paid on the principal of loans appropriated from the SSTF) will be less than interest earnings ( interest paid on the loans appropriated from the SSTF).  

 I rest my case. The evidence is right there in your own posts but you still don't see it.  My fear is that  other well meaning citizens will be as taken is as you were by the Trustees report which could only be the work of Republican operatives working from within. They had to print the truth, but  nothing prevented them from trying their best to hide it behind useless rhetoric designed to confuse the voting public and make it seem that the SSTFs are receiving welfare from the General fund. Nothing could be farther from the truth. If you have reached that conclusion, read the trustees Report again. This time open your mind and try to absorb what you  are reading.


----------



## The Rabbi

PaulS1950 said:


> Even with the reduction in Social Security payment from employees this is the data from 2011:
> 
> $819 billion collected
> $725 billion paid out
> -------------------------
> $ 94 billion reserve for the year of 2011
> 
> At no time has less been collected than has been paid out - where is the reserve going?
> Every year the reserve that is supposed to be held in trust is spent to cover other costs of big government.
> The Feds will make sure that we go broke before they do - but it won't be long after.



There is no "reserve."  The excess money purchases Treasury notes, which the Feds spend, leaving a pile of IOUs.

But that is ancillary to the issue.  Europe is not a great example because their legal structure is fairly different from ours.  The difficulty in starting and growing businesses there is far harder than here, even in places like CA.  So the regulatory environment itself limits economic growth, even without burdensome taxation.
Returning to the US: we have two issues.  The first is the growing regulatory millstone around companies' necks.  Obamacare is a big part of it, but only a part.  Most businesses over 50 employees are spending from now to the end of the year trying to figure out how to game the system so they can survive.  That isn't a productive use of time or money.  The EPA and other agencies like the new Consumer Protection agency are spinning out regs like no tomorrow, adding to regulations and compliance costs.  These are effectively taxes as real money has to be spent to comply with them.
The second is the relatively high level of corporate taxation and the gov'ts claim on overseas earnings.  We now have about the least competitive tax rates for companies and every incentive to keep money overseas.
Added to this is a level of uncertainty as to what will come next.  Companies must be able to plan so they can make educated guesses about costs.  The Obama Administration has made this impossible with their constant streams of regs, tax proposals, and mandates.
The best approach is simply starve the beast.  With less money to spend agencies will have to cut back on their activities, benefiiting private enterprise.


----------



## Wiseacre

JQPublic1 said:


> Wiseacre said:
> 
> 
> 
> You (and Paul) are mistaken.  The SS Fund is taking in less than it is paying out, which is contrary to what Paul wrote.   Which was a shortfall on $45 billion in 2011, and it will continue to rise.   Steeply.   That money comes out of the US Treasury, we have to borrow from somebody (Chinese?) to pay that $45 billion.   Interest and non-interest don't mean squat, when the SSTF has a shortfall the federal gov't has to make good on it.
> 
> 
> 
> 
> I see the obfuscation found in the Trustees Report and I see the intended effect  it has on you, Sarge; and, that is unfortunate. *Interest and non interest income does mean "squat."* In fact, both types of income have to be included in determining the actual value of assets in the SS Trust Funds. To me, it is plain that the $45 Billion "shortfall" of which you speak is the difference between the money taken in through  payroll taxes and expenditures. That 45 Billion "shortfall" does not take into account the interest paid and principal owed to the SSTFs from the loans appropriated by Congress. Understanding that dynamic is crucial to understanding the Trustee Report.
> 
> I'm not sure that you read your own post when  you seem to ignore words  like "redemption" or "non interest" income. Those words are huge keys to navigating through the calculated morass seen in the Trustees Report.
> I respectfully solicit your response to the following  snippets from your Trustee Report:
> 
> 
> 
> 
> 
> Redemption of trust fund assets from the General Fund of the Treasury will provide the resources needed to offset the annual cash-flow deficits
> 
> Click to expand...
> 
> .
> 
> What do you think the phrase "redemption of Trust Fund assets from the General Fund" means here? It is a reference to the principal loan amount owed to the SSTF. You can only redeem something that has been taken away or borrowed. The annual cash flow deficits mentioned  in the report( represented by the 45 Billion figure in 2011) is the difference between non interest income and expenditures;i.e. payroll taxes vs money paid to recipients.  The word "deficit" here does not take into account interest payments or the principal on loans owed to the SSTFs by the General Fund.
> 
> 
> 
> 
> 
> Since these redemptions will be less than interest earnings through 2020, nominal trust fund balances will continue to grow
> 
> Click to expand...
> 
> .
> 
> Can you explain why the SSTF balances will continue to grow through 2020? In plain language, the principal of the loan is what interest is based on.  According to the above statement ,redemptions ( money paid on the principal of loans appropriated from the SSTF) will be less than interest earnings ( interest paid on the loans appropriated from the SSTF).
> 
> I rest my case. The evidence is right there in your own posts but you still don't see it.  My fear is that  other well meaning citizens will be as taken is as you were by the Trustees report which could only be the work of Republican operatives working from within. They had to print the truth, but  nothing prevented them from trying their best to hide it behind useless rhetoric designed to confuse the voting public and make it seem that the SSTFs are receiving welfare from the General fund. Nothing could be farther from the truth. If you have reached that conclusion, read the trustees Report again. This time open your mind and try to absorb what you  are reading.
Click to expand...



Alright, one more try at this, then I'm giving up.   If the SSTF takes in less money than it pays out, that is a deficit that must be met by the US Treasury General Fund.   Period.   Let's try an example:  say the SSA takes in $800 billion in 2011 from people paying in, but they paid out $845 billion to beneficiaries.   So the SSTF has a $45 billion deficit for 2011, as it says in the summary.

Let's say further that the SSTF has 2 trillion dollars in treasury bonds, for which it is paid 3% interest.   So, the SSTF now has 2 trillion plus 60 billion in interest in treasury bonds earned in 2011, okay?   But they have a deficit of $45 billion in 2011, which means they have to cash in $45 billion in TBills.   Where does the Treasury get that $45 billion?   Only one way - they borrow it, and our debt just went up $45 billion dollars.   Whether the interest from the TBills exceeds the SSTF shortfall or not does not really matter;  in the end we the taxpayers will have to cover the SSTF shortfall.

And at some point the SSTF will use up the last of it's TBills and will be broke;  in about 20-25 years I think.   You think we should wait for that to happen or do somerthing about it now?   From the summary:

"  The trust fund ratio, which indicates the number of years of program cost that could be financed solely with current trust fund reserves, peaked in 2008, declined through 2011, and is expected to decline further in future years. After 2020, Treasury will redeem trust fund assets in amounts that exceed interest earnings until exhaustion of trust fund reserves in 2033, three years earlier than projected last year. Thereafter, tax income would be sufficient to pay only about three-quarters of scheduled benefits through 2086.  "

The trust fund reserves talked about here are TBills that US taxpayers have to redeem.   It's important we all understand this:   when the SSTF has a shortfall, the money that is used to make up the difference comes from INCREASING THE DEBT.


----------



## Sallow

Old Rocks said:


> Clinton raised taxes on the rich in '92. And the economy cratered, right? Not quite. Longest sustained economic boom in our naton's history.
> 
> Then Bushie Baby cut taxes, while engaged in two wars. And the economy did great, right? LOL. 16 trillion in homeowners value and 401Ks lost in two years, from 2007 to 2009.
> 
> So, what are we to believe? Recent history or rightwing ideology?



It is not just recent history.

Early America used to military to clear cut forests and build stuff.

FDR put into place massive spending programs. As did Eisenhower.

Seems that during those times, the American economy grew..and America expanded.


----------



## saveliberty

The economy goes through cycles regardless of who's in office.  Congress and the President can make that cycle go faster or slower and fall more easily or harder.


----------



## The Rabbi

Sallow said:


> Old Rocks said:
> 
> 
> 
> Clinton raised taxes on the rich in '92. And the economy cratered, right? Not quite. Longest sustained economic boom in our naton's history.
> 
> Then Bushie Baby cut taxes, while engaged in two wars. And the economy did great, right? LOL. 16 trillion in homeowners value and 401Ks lost in two years, from 2007 to 2009.
> 
> So, what are we to believe? Recent history or rightwing ideology?
> 
> 
> 
> 
> It is not just recent history.
> 
> Early America used to military to clear cut forests and build stuff.
> 
> FDR put into place massive spending programs. As did Eisenhower.
> 
> Seems that during those times, the American economy grew..and America expanded.
Click to expand...


So what happened this time?  Obama has spent more than every other president combined.  Where is the expansion??


----------



## JQPublic1

Wiseacre said:


> Alright, one more try at this, then I'm giving up.



I am with you here! We have both presented our arguments with zeal and civility. I say let those with the inclination sift through the bewildering array of posts and arrive at their own conclusions. Great debate! Thanks!


----------



## jaymiewilson

> Wiseacre said:
> 
> 
> 
> So you ask, what does this have to do with our fiscal cliff?   Well, the president is asking for tax hikes and the republicans are asking for spending cuts.   Hard to say what we'll end up with, but I'm pretty sure it'll be weighted more to the tax hike side than the spending cut side.   In a recent article appearing the USAToday by Matthew Melchiorre of the Competitive Enterprise Institute, the current fiscal cliff as it is now calls for 4 times the amount of tax increases than spending cuts.
> 
> snippet:
> 
> Beginning next year, $136 billion of spending cuts are scheduled to take place according to the Congressional Budget Office (CBO). These include the mandatory sequestration of defense and discretionary spending resulting from the failure of last year's bipartisan "supercomittee" to agree on a 10-year plan to cut the federal budget by $1.5 trillion. They also include the end of unemployment benefit extensions and reductions in Medicare reimbursement rates. Keep in mind these aren't real cuts in overall government spending, but merely reductions in its rate of growth.
> 
> They are also trivial compared to the $532 billion of scheduled tax increases that CBO also reports. Most of this comes from income tax rates reverting back to pre-2001 levels and the alternative minimum tax expanding deeply into middle-class households. That's roughly four dollars of tax increases for every one dollar of so-called spending cuts.
> 
> 
> It is true that significant spending cuts will hurt short term.   But it needs to be done, the big deficit drivers are defense, medicare and medicaid, and social security.   These programs must be reined in to be sustainable not just for the seniors who need them now but also for younger generations who will need them later.   Combine that with tax reform that increases revenue and a cap on gov't spending and we're in business.   I think this is Obama's big chance to make his mark in American history;  if he can lead us to reasonable and workable solutions that will succeed long term, he could go down as one of our best presidents.   If he doesn't, he'll take his place next to Jimmy Carter.
Click to expand...



Somehow, it's true.


----------



## PaulS1950

look here for the graph on spending:
Image Detail for - 2011 Federal Spending

and here for the graph on income:
Image Detail for - 2011 Federal Income

Now you look at the graph and tell me that the SS income was less than was spent!


----------



## Wiseacre

PaulS1950 said:


> look here for the graph on spending:
> Image Detail for - 2011 Federal Spending
> 
> and here for the graph on income:
> Image Detail for - 2011 Federal Income
> 
> Now you look at the graph and tell me that the SS income was less than was spent!




Your graphs weren't very clear on SSTF income and expenditures.   I'd rather go with what the SSTF trustees said in their report:

"  Social Securitys expenditures exceeded non-interest income in 2010 and 2011, the first such occurrences since 1983, and the Trustees estimate that these expenditures will remain greater than non-interest income throughout the 75-year projection period. The deficit of non-interest income relative to expenditures was about $49 billion in 2010 and $45 billion in 2011, and the Trustees project that it will average about $66 billion between 2012 and 2018 before rising steeply as the economy slows after the recovery is complete and the number of beneficiaries continues to grow at a substantially faster rate than the number of covered workers.  "


----------



## PaulS1950

The graph shows that 819 billion dollars were collected in SS taxes - with the employee cut in effect and that the amount paid out was 725 billion. I don't know how much clearer you can get than that.
Believe what you want to, I try to keep from arguing matters of faith with logic as belief trumps the facts every time.


----------



## boedicca

PaulS1950 said:


> The graph shows that 819 billion dollars were collected in SS taxes - with the employee cut in effect and that the amount paid out was 725 billion. I don't know how much clearer you can get than that.
> Believe what you want to, I try to keep from arguing matters of faith with logic as belief trumps the facts every time.




Here's what the Trustees are saying now:

_*The long-run actuarial deficits of the Social Security and Medicare programs worsened in 2012*, though in each case for different reasons. The actuarial deficit in the Medicare Hospital Insurance program increased primarily because the Trustees incorporated recommendations of the 2010-11 Medicare Technical Panel that long-run health cost growth rate assumptions be somewhat increased. The actuarial deficit in Social Security increased largely because of the incorporation of updated economic data and assumptions. Both Medicare and Social Security cannot sustain projected long-run program costs under currently scheduled financing, and legislative modifications are necessary to avoid disruptive consequences for beneficiaries and taxpayers. ..._

Trustees Report Summary


But I suppose it will take the system collapsing before you are willing to acknowledge it needs serious reform.


----------



## saveliberty

PaulS1950 said:


> The graph shows that 819 billion dollars were collected in SS taxes - with the employee cut in effect and that the amount paid out was 725 billion. I don't know how much clearer you can get than that.
> Believe what you want to, I try to keep from arguing matters of faith with logic as belief trumps the facts every time.



Its like a balloon payment loan idiot.


----------



## Wiseacre

PaulS1950 said:


> The graph shows that 819 billion dollars were collected in SS taxes - with the employee cut in effect and that the amount paid out was 725 billion. I don't know how much clearer you can get than that.
> Believe what you want to, I try to keep from arguing matters of faith with logic as belief trumps the facts every time.



Well I believe I'll take the SSTF trustees' words over your pictures anytime.


----------



## JQPublic1

http://www.cbo.gov/sites/default/files/cbofiles/attachments/06-05-Long-Term_Budget_Outlook_2.pdf


I couldn't give up on researching this hot topic. Looking to the Congressional Budget Office, I found this excerpt at their website. The CBO website makes good use of pdf files and renders a much clearer picture of the long term budget outlook  for social security than the Trustees Report does and more. See chapter 4!

*From the CBO:*

Interest on the trust funds balances is credited
to those funds, but because the interest transactions
represent payments from one part of the government
(the general fund of the U.S. Treasury) to another (the
Social Security trust funds), they *do not affect federal
budget deficits or surpluses.*

Considering the above, It is puzzling that the Republicans want to put Social Security on the bargaining table in talks about the federal deficit.  Social Security may need reforming but that reform ought not to be tied to talks about the federal deficit! That was the point Reagan was making in the link I provided earlier and it is the point that I am making now! I think the CBO backs Reagan and me!


----------



## Wiseacre

JQPublic1 said:


> http://www.cbo.gov/sites/default/files/cbofiles/attachments/06-05-Long-Term_Budget_Outlook_2.pdf
> 
> 
> I couldn't give up on researching this hot topic. Looking to the Congressional Budget Office, I found this excerpt at their website. The CBO website makes good use of pdf files and renders a much clearer picture of the long term budget outlook  for social security than the Trustees Report does and more. See chapter 4!
> 
> *From the CBO:*
> 
> Interest on the trust funds&#8217; balances is credited
> to those funds, but because the interest transactions
> represent payments from one part of the government
> (the general fund of the U.S. Treasury) to another (the
> Social Security trust funds), they *do not affect federal
> budget deficits or surpluses.*
> 
> Considering the above, It is puzzling that the Republicans want to put Social Security on the bargaining table in talks about the federal deficit.  Social Security may need reforming but that reform ought not to be tied to talks about the federal deficit! That was the point Reagan was making in the link I provided earlier and it is the point that I am making now! I think the CBO backs Reagan and me!



What you've written is exactly true!   Interest transaction payments from one part of gov't to another does not affect the budget deficit.   I said that myself a few times in this thread I think.   What DOES affect the budget deficit is when the SSTF has a deficit where less money comes in from employees paying in than benefits going out to retirees.   Which as the trustees said in their report has occurred in 2010 and 2011 and is expected to worsen in the coming years.   Which is why making structural changes to that program should be done.


----------



## JQPublic1

Wiseacre said:


> JQPublic1 said:
> 
> 
> 
> http://www.cbo.gov/sites/default/files/cbofiles/attachments/06-05-Long-Term_Budget_Outlook_2.pdf
> 
> 
> I couldn't give up on researching this hot topic. Looking to the Congressional Budget Office, I found this excerpt at their website. The CBO website makes good use of pdf files and renders a much clearer picture of the long term budget outlook  for social security than the Trustees Report does and more. See chapter 4!
> 
> *From the CBO:*
> 
> Interest on the trust funds balances is credited
> to those funds, but because the interest transactions
> represent payments from one part of the government
> (the general fund of the U.S. Treasury) to another (the
> Social Security trust funds), they *do not affect federal
> budget deficits or surpluses.*
> 
> Considering the above, It is puzzling that the Republicans want to put Social Security on the bargaining table in talks about the federal deficit.  Social Security may need reforming but that reform ought not to be tied to talks about the federal deficit! That was the point Reagan was making in the link I provided earlier and it is the point that I am making now! I think the CBO backs Reagan and me!
> 
> 
> 
> 
> What you've written is exactly true!   Interest transaction payments from one part of gov't to another does not affect the budget deficit.   I said that myself a few times in this thread I think.   What DOES affect the budget deficit is when the SSTF has a deficit where less money comes in from employees paying in than benefits going out to retirees.   Which as the trustees said in their report has occurred in 2010 and 2011 and is expected to worsen in the coming years.   Which is why making structural changes to that program should be done.
Click to expand...


I read all of your posts  in this thread and I don't remember you saying anything like the CBO excerpt I just posted. On the contrary, your response to the link  showing Reagan   saying  social Security had nothing to do with the federal deficit was:" You do know that things have changed in 30 years, don't you?"

Even more enigmatic  is this statement:



Wiseacre said:


> What DOES affect the budget deficit is when the SSTF has a deficit where less money comes in from employees paying in than benefits going out to retirees.   Which as the trustees said in their report has occurred in 2010 and 2011 and is expected to worsen in the coming years.



The CBO has that same information on their site but they didn't add your wishful thinking
to their synopsis. The difference between payroll taxes collected and expenditures is to what you are referring; and, yes, it was listed as a deficit on that poorly written Trustee's report. But even the Trustees Report stopped short of proclaiming that "shortfall" as contributing to the national or federal deficit.  You are caught up in the belief that tax payers are bailing out the SSTF because of that "shortfall." That is NOT the case. The interest payments that helped the SSTF meet its obligations in 2011 when the shortfall occured did not affect the federal deficit at all. That CBO excerpt explains that perfectly!


Nice try, but I gotcha!


----------



## Wiseacre

JQPublic1 said:


> Wiseacre said:
> 
> 
> 
> 
> 
> JQPublic1 said:
> 
> 
> 
> http://www.cbo.gov/sites/default/files/cbofiles/attachments/06-05-Long-Term_Budget_Outlook_2.pdf
> 
> 
> I couldn't give up on researching this hot topic. Looking to the Congressional Budget Office, I found this excerpt at their website. The CBO website makes good use of pdf files and renders a much clearer picture of the long term budget outlook  for social security than the Trustees Report does and more. See chapter 4!
> 
> *From the CBO:*
> 
> Interest on the trust funds balances is credited
> to those funds, but because the interest transactions
> represent payments from one part of the government
> (the general fund of the U.S. Treasury) to another (the
> Social Security trust funds), they *do not affect federal
> budget deficits or surpluses.*
> 
> Considering the above, It is puzzling that the Republicans want to put Social Security on the bargaining table in talks about the federal deficit.  Social Security may need reforming but that reform ought not to be tied to talks about the federal deficit! That was the point Reagan was making in the link I provided earlier and it is the point that I am making now! I think the CBO backs Reagan and me!
> 
> 
> 
> 
> What you've written is exactly true!   Interest transaction payments from one part of gov't to another does not affect the budget deficit.   I said that myself a few times in this thread I think.   What DOES affect the budget deficit is when the SSTF has a deficit where less money comes in from employees paying in than benefits going out to retirees.   Which as the trustees said in their report has occurred in 2010 and 2011 and is expected to worsen in the coming years.   Which is why making structural changes to that program should be done.
> 
> Click to expand...
> 
> 
> I read all of your posts  in this thread and I don't remember you saying anything like the CBO excerpt I just posted. On the contrary, your response to the link  showing Reagan   saying  social Security had nothing to do with the federal deficit was:" You do know that things have changed in 30 years, don't you?"
> 
> Post #32
> 
> Even more enigmatic  is this statement:
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> What DOES affect the budget deficit is when the SSTF has a deficit where less money comes in from employees paying in than benefits going out to retirees.   Which as the trustees said in their report has occurred in 2010 and 2011 and is expected to worsen in the coming years.
> 
> Click to expand...
> 
> 
> The CBO has that same information on their site but they didn't add your wishful thinking
> to their synopsis. The difference between payroll taxes collected and expenditures is to what you are referring; and, yes, it was listed as a deficit on that poorly written Trustee's report. But even the Trustees Report stopped short of proclaiming that "shortfall" as contributing to the national or federal deficit.  You are caught up in the belief that tax payers are bailing out the SSTF because of that "shortfall." That is NOT the case. The interest payments that helped the SSTF meet its obligations in 2011 when the shortfall occured did not affect the federal deficit at all. That CBO excerpt explains that perfectly!
> 
> You are mistaken sir, when the SSTF ha a shortfall, the taxpayers have to pay for the redeemed payments from the General Fund.
> 
> Nice try, but I gotcha!
Click to expand...


I realize you guys on the left believe that money magically appears out of nowhere, but the truth is that when the SSTF runs a deficit in a given year that money has to come from the taxpayers because that deficit is covered by the US Treasury General Fund.   There is no lockbox somewhere with trillions of dollars in it.


----------



## catatomic

According to the Silicon Valley Biz Blog,

Barack has offered 1.6 trillion in new yax revenue - including an immediate tax hike on high income earners, and $400 billion in spending cuts (I can't post a link yet).

The GOP today or yesterday (John Boehner) proposed $800 billion (also according to the WSJ). in new tax revenue [closing tax loopholes (I never knew that would bring in so much)], and $1.4 trillion in spending cuts and savings (medicare, social security and farm subsidies).

Also, cnn has said that with energy, investment from making a decision, manufacturing jobs, and a growing real estate market, we could see a renaissance if we only get this deal right.  I do not know if this is already included in the math.

I also do not know if even $2.2 trillion over 10 years is better than going off the cliff.


----------



## saveliberty

Despite your efforts to muddy the waters JGPublic1, both parties admit Social Security needs reforming in order to keep it afloat.  The Democrats just want to make the Republicans responsible for it.  Some leadership there.


----------



## PaulS1950

Since the national debt is growing at over 1 trillion dollars a year I doubt that 2 trillion dollars in cuts and taxes over ten years is going to make much difference. In the last year of his first term the Obama administation added 3 trillion dollars to the debt. 

Its already over folks - we are hemaraging our life away and darn few are paying attention. In less than twenty years we will go bankrupt. A nation cannot go on spending trillions more than they bring in in taxes - borrowing what they don't bring in and paying only the interest on the loans. Eventually you have to borrow to pay the interest - Bankrupt!


----------



## catatomic

The sooner we help it the better!

Say we have 300million people and a 16trillion dollar deficit.  Say it goes up 1trillion.  Then we owe, on average, 6.25% more  The amount we owe goes from $53,000 to $57,000.!


----------



## Trajan

Old Rocks said:


> Clinton raised taxes on the rich in '92. And the economy cratered, right? Not quite. Longest sustained economic boom in our naton's history.
> 
> Then Bushie Baby cut taxes, while engaged in two wars. And the economy did great, right? LOL. 16 trillion in homeowners value and 401Ks lost in two years, from 2007 to 2009.
> 
> So, what are we to believe? Recent history or rightwing ideology?



you answered your own post. and don't even know it- this is not 1992. or 1996 or 99....Bush did run 2 wars off budget, not that that matters in the long run, debt is debt.. 
The economy until the housing market crashed actually did do well, federal receipts were up, but, again, it went out the door and he borrowed too.  


Income tax revenue is up 26% over the last 2 years, meanwhile, obama is attempting to enshrine a stimulus and a 1/4 like spending wedge in every budget as he has done the last 3 years and wants someone to pay for it, well,  83Bn dollars will not run the gov. for  more than a week and a half, thats what the rate increases gets us....thats an answer to the issue??

And lets be clear what you don't hear discussed is that a) 250k is now classified as 'rich', and b) there already is a 3.8% tax increase on all investment income baked into Obamacare anyway, now we want to add another 4.8% on their income and raise cap gains rates too aside from the obamacare increase?  

Obama said in 2010, at the same point in time then that he signed the bush cuts to an extension becasue the economy was to weak, well, its just as fragile now and despite and we got that 26% without it. 


go look at what the UK yielded on their taxes on the rich...they dropped 60% of their 'millionaires ' in a year and a half. You tax- money flees. That 83 Bn will be for the first year only, then it will drop and investment which is weak now will drop further, its not the answer. Tax reform is.


----------



## oldfart

The CBO has a very readable report out dated November 22 covering the messy mechancs of infows and outflows of government funds and the trust funds at
CBO | Federal Debt and the Statutory Limit, November 2012



			
				CBO said:
			
		

> Of the $16.3 trillion in outstanding debt subject to limit, $11.5 trillion is held by the public and $4.8 trillion is held by government accounts...
> Debt held by government accounts&#8212;Government Account Series (GAS) securities&#8212;is dominated by the transactions of a few large trust funds. When a trust fund receives cash that is *not immediately needed to pay benefits or to cover the relevant program&#8217;s expenses*, the Treasury credits the trust fund with that income by issuing GAS securities to the fund. The Treasury then uses the cash to finance the government&#8217;s ongoing activities. When revenues for a trust fund program fall short of expenses, the reverse happens: The Treasury redeems some of the GAS securities. The crediting and redemption of securities between the Treasury and trust funds are intragovernmental in nature *but directly affect the amount of debt subject to limit*.


Emphasis is mine.  

The timing of major monthly outlays is 


			
				CBO said:
			
		

> Payments to Medicare Advantage and Medicare Part D plans: on the first day of the month (about $17 billion);
> Social Security benefits: on the third day of the month (about $25 billion), with subsequent smaller payments on three Wednesdays per month (about $11 billion each);
> Pay for active-duty members of the military and benefit payments for civil service and military retirees, veterans, and recipients of Supplemental Security Income: on the first day of the month (about $25 billion); and
> Interest payments: around the 15th and the last day of the month (with some variation).


On the revenue side 


			
				CBO said:
			
		

> Deposits (mostly tax revenues) are relatively smooth throughout each month except for large payments of nonwithheld taxes occurring near specified dates. The largest payments occur in April, when individual tax returns are due. Estimated taxes from corporations and individuals are due at four different points in the year, including mid-December (for most corporations) and mid-January (for individuals). In addition, corporate income tax receipts rise in March, when most corporations&#8217; tax returns are due.


A lot of these transactions tend to cancel each other out.


			
				CBO said:
			
		

> On net, the amount of outstanding GAS securities tends to fluctuate very little during a month, except when redemptions occur to reflect the payment of benefits for programs like Social Security and Medicare. (Those trust funds account for about two-thirds of the government&#8217;s trust fund balances.) However, those redemptions of GAS securities, which reduce the amount of debt subject to limit, are normally offset by additional borrowing from the public to obtain the cash to make actual payments. Most GAS securities pay interest in the form of additional securities on June 30 and December 31. (Recent payments have amounted to about $80 billion on each day.)


If you have an office pool on when the "cliff" arrives, you should be aware of the following dates:


			
				CBO said:
			
		

> Cash Inflows to the Treasury
> Mid-January: receipt of nonwithheld individual income tax payments (which have averaged about $45 billion over the past few years) and
> Mid-March: receipt of corporate tax payments (which have averaged about $23 billion over the past few years).
> Cash Outflows from the Treasury
> February 1: payments for Social Security benefits (ordinarily made on the 3rd of the month, which is a Sunday), Medicare Advantage, Medicare Part D, certain other benefits, and pay for active-duty members of the military (recently about $67 billion);
> February 6, 13, and 20: additional Social Security benefit payments (recently about $11 billion each time);
> February 15: a large interest payment on publicly issued securities (previously over $30 billion);
> March 1: payments for Social Security benefits (ordinarily made on the 3rd of the month, which again is a Sunday), Medicare Advantage, Medicare Part D, certain other benefits, and pay for active-duty members of the military (recently about $67 billion);
> March 6, 13, and 20: additional Social Security benefit payments (recently about $11 billion each); and
> February and March: ordinarily, substantial payments of tax refunds (amounts vary).



The wild card is tax refunds; so if you have money on the bet, check the IRS website to track the refunds issued week by week.   If we are close to the debt ceiling, the IRS will probably delay income tax refunds to stay under the limit.  I'm betting (literally, we have an office pool) that this can float things until the April 15 tax payments on balance due returns comes in.  So I'm picking May 14 as the actual "drop-dead" or default date.  
What's your pick?


----------



## Sactowndog

Wiseacre said:


> So you ask, what does this have to do with our fiscal cliff?   Well, the president is asking for tax hikes and the republicans are asking for spending cuts.   Hard to say what we'll end up with, but I'm pretty sure it'll be weighted more to the tax hike side than the spending cut side.   In a recent article appearing the USAToday by Matthew Melchiorre of the Competitive Enterprise Institute, the current fiscal cliff as it is now calls for 4 times the amount of tax increases than spending cuts.
> 
> snippet:
> 
> Beginning next year, $136 billion of spending cuts are scheduled to take place according to the Congressional Budget Office (CBO). These include the mandatory sequestration of defense and discretionary spending resulting from the failure of last year's bipartisan "supercomittee" to agree on a 10-year plan to cut the federal budget by $1.5 trillion. They also include the end of unemployment benefit extensions and reductions in Medicare reimbursement rates. Keep in mind these aren't real cuts in overall government spending, but merely reductions in its rate of growth.
> 
> They are also trivial compared to the $532 billion of scheduled tax increases that CBO also reports. Most of this comes from income tax rates reverting back to pre-2001 levels and the alternative minimum tax expanding deeply into middle-class households. That's roughly four dollars of tax increases for every one dollar of so-called spending cuts.
> 
> Column: America must avoid Europe's toxic tax remedy
> 
> It is true that significant spending cuts will hurt short term.   But it needs to be done, the big deficit drivers are defense, medicare and medicaid, and social security.   These programs must be reined in to be sustainable not just for the seniors who need them now but also for younger generations who will need them later.   Combine that with tax reform that increases revenue and a cap on gov't spending and we're in business.   I think this is Obama's big chance to make his mark in American history;  if he can lead us to reasonable and workable solutions that will succeed long term, he could go down as one of our best presidents.   If he doesn't, he'll take his place next to Jimmy Carter.



The numbers are indisputable.  Spending must be cut and the areas such as Medicare, Medicaide, social security and defense are the major drivers.  This can't be disputed by anyone who had seen the numbers.

But you can't blame Obama alone.  The Republican Party only cares about tax cuts and doesn't really care about the deficit.  This is not the Republican Party of Bill Clinton era it is another breed of cat.  They are bound by the no tax pledge and will happy trade off lower taxes for increasing the budget deficit.  

Don't believe me, then why are they willing to pass tax cuts for the rest of us with no spending reductions?  If they really cared about the deficit they would say you want those tax cuts you have to reduce spending and here are the areas.  

Both parties use the deficit as a tool to beat the other but that is where it stops.  Neither is willing to give up their sacred cows to address the deficit.  Of Obama vetoes the middle class tax cuts without spending cuts because they will drive up the deficit he will have earned my respect.


----------



## Staidhup

Yep, Social Security is forecasted to exceed 5.2% of GDP as measured in annual liabilities within the next 8 years, currently 4.+% of GD,P it has nothing to do with the deficit or budget, so with an increase from 41 million recipients to over 84 million during the next 8 years is nothing to worry about. So when expenses exceed contributions who pays? Ah, but who cares Kiplinger news letter is some sort of right wing rag right? Then what do you call the Congressional budget office. Oh well some people live in fantasy land and some don't.


----------



## Sactowndog

PaulS1950 said:


> Since the national debt is growing at over 1 trillion dollars a year I doubt that 2 trillion dollars in cuts and taxes over ten years is going to make much difference. In the last year of his first term the Obama administation added 3 trillion dollars to the debt.
> 
> Its already over folks - we are hemaraging our life away and darn few are paying attention. In less than twenty years we will go bankrupt. A nation cannot go on spending trillions more than they bring in in taxes - borrowing what they don't bring in and paying only the interest on the loans. Eventually you have to borrow to pay the interest - Bankrupt!



Paul you are right but the problem rest squarely with the GOP.  The are prioritizing tax cuts for the wealthy over spending cuts and reforming entitlements.  If the GOP reversed those priorities we would have a deal done quickly and between the tax increase and spending cuts we would have made real progress on the deficit.

This model was followed by Clinton and the Republican congress to make real progress and the deficit and the economy did well as a result as people believed we would not be spending ourselves into bankrauptcy.


----------



## Wiseacre

Sactowndog said:


> PaulS1950 said:
> 
> 
> 
> Since the national debt is growing at over 1 trillion dollars a year I doubt that 2 trillion dollars in cuts and taxes over ten years is going to make much difference. In the last year of his first term the Obama administation added 3 trillion dollars to the debt.
> 
> Its already over folks - we are hemaraging our life away and darn few are paying attention. In less than twenty years we will go bankrupt. A nation cannot go on spending trillions more than they bring in in taxes - borrowing what they don't bring in and paying only the interest on the loans. Eventually you have to borrow to pay the interest - Bankrupt!
> 
> 
> 
> 
> Paul you are right but the problem rest squarely with the GOP.  The are prioritizing tax cuts for the wealthy over spending cuts and reforming entitlements.  If the GOP reversed those priorities we would have a deal done quickly and between the tax increase and spending cuts we would have made real progress on the deficit.
> 
> This model was followed by Clinton and the Republican congress to make real progress and the deficit and the economy did well as a result as people believed we would not be spending ourselves into bankrauptcy.
Click to expand...


The Clinton era surplus was due to TAX CUTS and SPENDING CUTS that Clinton had to swallow.    Guys like you always blame the GOP, but I don't see the democrats offering any reforms to the entitlement programs.   Every deomcrat I see on TV is saying hell no, we can't have that!   

The truth is that you guys want complete capitulation, total surrender.   You don't want cooperation or compromise, you want it all your way.   Sorry dude, Obama may have been re-elected but so did the House republicans.


----------



## Katzndogz

Clinton raised the income tax rate but lowered the capital gains rate.  No one wants to think about that part.


----------



## saveliberty

Democrats say they will compromise, but don't

Democrats say give us a list of cuts to make, they get them and reject it.

Democrats say its the Republican's fault, they say a lot don't they?


----------



## Foxfyre

I blame both Democrats and Republicans for growing government and shrinking incentives in the private sector.  I blame both Democrats and Republicans for policy and spending that have done far more damage than good.  Both have govverned left of center since 2001 if you look closely at the data,  The only real difference between the two parties is that the Republicans don't pretend that we can spend ourselves into prosperity even as they stuff the bills with pork that they hope will get them re-elected.

The Republicans at least attempt to talk the fiscal reponsibility game and are more interested in economic prosperity than the Democrats seem to be,

Romney's approach was to get people back to work and the economy moving again.  If he had focused on that one single thing instead of diluting his message with concepts that don't resonate as well or that are easier to demonize, he might have fared better.  I don't know when you are bucking a system that now is providing some kind of direct government benefit to more than 50% of the population.

But I do know when you look at their plan to spread huge spending cuts over long periods up to ten years, it not only is fantasy land, it not only is a drop in the bucket, but you know it is never going to happen.  As they have always done, they'll just keep adding stuff on the bottom of the pile so that the actual burden is never actually reduced.


----------



## oldfart

saveliberty said:


> Democrats say they will compromise, but don't
> 
> Democrats say give us a list of cuts to make, they get them and reject it.
> 
> Democrats say its the Republican's fault, they say a lot don't they?



OK, lets talk about efforts to reduce the deficit.  Start by taking SimpsonBowles as a baseline.  It proposed  $2.9 trillion in spending cuts and $2.6 trillion in tax increases.
This is almost an even split, so the idea that most of the deficit reduction should be on the spending side and that we can do deficit reduction without tax increases is a novel idea, but it is certainly contrary to the actual SimpsonBowles plan.  

So what has happened on the spending side?  Congress has already passed and the President has already signed 70 percent of the discretionary cuts. Under the Budget Control Act, discretionary spending will be $1.5 trillion lower from 2013 to 2022 than was projected in the Congressional Budget Offices 2010 baseliner. That means that 70 percent of S-Bs cuts to discretionary spending are already done.  But the $1.4 trillion of security spending cuts have not even been spelled out.  

So which of the SB tax increases have been implemented?  Lets look:
1)	End the Bush tax cuts for those making over $250,000 before tax reform talks.NOT DONE
2)	15 cents per gallon increase in federal gasoline taxNOT DONE
3)	Tax dividends and capital gains as ordinary incomeNOT DONE
4)	Converting itemized deductions for charitable contributions and mortgage interest into a 12% non-refundable creditNOT DONE
5)	Phase out the exclusion of health care insurance from employees income by 2038NOT DONE
6)	Eliminate income exemption for interest on state and local bondsNOT DONE
7)	The change in taxation of Social Security benefits which would raise $238 billion over ten yearsNOT DONE

In all, of the $2.6 trillion of tax increases in SimpsonBowles, precisely zero has been enacted into law.  I wonder why?  

So the fact is that since 2010, most of the non-security spending cuts have been enacted while none of the tax increases have been enacted.  Democrats have been serious about spending cuts and have delivered; Republicans have been vague about revenues and have neither proposed any revenue increases nor agreed to any.


----------



## saveliberty

No oldfart, the act you speak of projects the spending cuts through 2022, with most actual cuts occurring after Obama's reign.  See, its easy to shove supposed cuts off on the next person.  That is exactly what the Democrats did.


----------



## Trajan

Wiseacre said:


> Sactowndog said:
> 
> 
> 
> 
> 
> PaulS1950 said:
> 
> 
> 
> Since the national debt is growing at over 1 trillion dollars a year I doubt that 2 trillion dollars in cuts and taxes over ten years is going to make much difference. In the last year of his first term the Obama administation added 3 trillion dollars to the debt.
> 
> Its already over folks - we are hemaraging our life away and darn few are paying attention. In less than twenty years we will go bankrupt. A nation cannot go on spending trillions more than they bring in in taxes - borrowing what they don't bring in and paying only the interest on the loans. Eventually you have to borrow to pay the interest - Bankrupt!
> 
> 
> 
> 
> Paul you are right but the problem rest squarely with the GOP.  The are prioritizing tax cuts for the wealthy over spending cuts and reforming entitlements.  If the GOP reversed those priorities we would have a deal done quickly and between the tax increase and spending cuts we would have made real progress on the deficit.
> 
> This model was followed by Clinton and the Republican congress to make real progress and the deficit and the economy did well as a result as people believed we would not be spending ourselves into bankrauptcy.
> 
> Click to expand...
> 
> 
> The Clinton era surplus was due to TAX CUTS and SPENDING CUTS that Clinton had to swallow.    Guys like you always blame the GOP, but I don't see the democrats offering any reforms to the entitlement programs.   Every deomcrat I see on TV is saying hell no, we can't have that!
> 
> The truth is that you guys want complete capitulation, total surrender.   You don't want cooperation or compromise, you want it all your way.   Sorry dude, Obama may have been re-elected but so did the House republicans.
Click to expand...


Any Clintonesque centrism etc. has gone by the wayside bro- like the Old Guard marching up that slope to oblivion at Waterloo, Pelosi marched every blue dog into the cannon of obamacare, yet its the extremist gop that wants to cut back the $830Bn and then some from every obama spending year there after 2009, as he attmpts to enshrine it in a new baseline for the future, thats why they won't do a budget, they can't, so we roll on Continuing Resolutions.


----------



## Foxfyre

Trajan said:


> Wiseacre said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> Paul you are right but the problem rest squarely with the GOP.  The are prioritizing tax cuts for the wealthy over spending cuts and reforming entitlements.  If the GOP reversed those priorities we would have a deal done quickly and between the tax increase and spending cuts we would have made real progress on the deficit.
> 
> This model was followed by Clinton and the Republican congress to make real progress and the deficit and the economy did well as a result as people believed we would not be spending ourselves into bankrauptcy.
> 
> 
> 
> 
> The Clinton era surplus was due to TAX CUTS and SPENDING CUTS that Clinton had to swallow.    Guys like you always blame the GOP, but I don't see the democrats offering any reforms to the entitlement programs.   Every deomcrat I see on TV is saying hell no, we can't have that!
> 
> The truth is that you guys want complete capitulation, total surrender.   You don't want cooperation or compromise, you want it all your way.   Sorry dude, Obama may have been re-elected but so did the House republicans.
> 
> Click to expand...
> 
> 
> Any Clintonesque centrism etc. has gone by the wayside bro- like the Old Guard marching up that slope to oblivion at Waterloo, Pelosi marched every blue dog into the cannon of obamacare, yet its the extremist gop that wants to cut back the $830Bn and then some from every obama spending year there after 2009, as he attmpts to enshrine it in a new baseline for the future, thats why they won't do a budget, they can't, so we roll on Continuing Resolutions.
Click to expand...


And that is the problem.  The Democrats have veered so far left, there is little common ground anywhere with the Republicans who have also shifted left but not far enough to find any middle ground.  Plus many Republicans have the additional problem of making a solemn promise of fiscal responsibility in order to get elected in the first place, and if they capitulate on raising income taxes and some other measures, they break that pledge.


----------



## PaulS1950

The feds are already talking about raising the debt ceiling again in October. Last October it was raised from 13 trillion dollars to 16 trillion dollars and the debt immediately jumped to 16.3 trillion dollars. Will it be raised another three trillion this october?

Lets do some easy math: If the interest was forgiven and the country paid 1 million dollars a day on the principal alone it would take over 44.6 thousand years to pay the loan off. Now if you add to that the several billion we pay in interest each year it would continue to grow and never get smaller.
We don't need to do anything but wait another ten to twenty years and the problem will destroy the USA. When the feds have no money most states will go bust too. The large cities that rely on federal and state funds will also go broke.
No electricity, military, police or firefighters. No trains to haul groceries and so no groceries at your local supermarkets. No jobs, no income, nothing but your survival skills which will leave most of the population dead in the first six months - and they will be the lucky ones.
Those who live in small farming commuities will fair slightly better for a while but they are likely to be taken over by armed groups and anarchy will rule.
We need to stop spending. We need to keep US funds at home. We need to stop being the world's police force and concentrate on getting our expenses in line so the debt can be paid off.
In the near future we will see milk prices double, bread prices will jump and meat prices will jump too.
Our power production is going to cost more and even natural gas will climb sharply if we don't reign in the spending to about 1/2 of what it is now. That is what it will take to pay the loan down and even at that it will take many lifetimes to pay it off and get the country back to where it should be.


----------



## The Rabbi

Paul that isnt entirely true. First off, much of the debt is internal, not foreign owned.  Second, if we simply maintain the current deficit but allow the economy to grow we will grow our way out of it.  Typically that doesnt happen.  Rising tax revenues (and revenues are higher now than 4 years ago) simply mean more spending.  That's what has to stop.  Along with economy-killing policies like over-regulation and union rules.


----------



## Foxfyre

The Rabbi said:


> Paul that isnt entirely true. First off, much of the debt is internal, not foreign owned.  Second, if we simply maintain the current deficit but allow the economy to grow we will grow our way out of it.  Typically that doesnt happen.  Rising tax revenues (and revenues are higher now than 4 years ago) simply mean more spending.  That's what has to stop.  Along with economy-killing policies like over-regulation and union rules.



That indeed has been the history of the U.S. Congress for some time now no matter which party is in power.  The more money you give Congress, the more they spend.  They just don't seem to have it in them to pay down the debt with it.  If it goes into the treasury, they spend it plus borrow more against it.   On what planet does anybody believe Obama and the current Congress will be any different if the tax increases go into effect?

The only time that the deficit is reduced or the budget balanced has been due to economic growth that funnels trillions into the treasury.  We don't seem to have a President or Senate who understand that or have a clue how to make that happen even if they wanted to.  And it seems that lovers of big, authoritarian, 'benevolent' government don't even want to.


----------



## oldfart

saveliberty said:


> No oldfart, the act you speak of projects the spending cuts through 2022, with most actual cuts occurring after Obama's reign.  See, its easy to shove supposed cuts off on the next person.  That is exactly what the Democrats did.



The scoring projections including the ten year benchmark are established by Congress.  If you want to use some other figure, all CBO scoring breaks out effect on the deficit for each year, for the first five years and for ten years.  Simpson--Bowles does contain illustrative benchmarks, if you want to go there.  

The report gave benchmarks assuming passage in 2011 and implementation by 2012.  Here are their figures:

CUTS IN DISCRETIONARY SPENDING:  $102 b in 2013, $172 b in 2015, $291 b in 2020

CUTS IN MANDATORY SPENDING:  $32 b in 2013, $54 b in 2015, $104 b in 2020

REDUCTIONS IN TAX EXPENDITURES:  $20 b in 2013, $80 b in 2015, $180 b in 2020

OTHER REVENUE MEASURES & INTEREST SAVINGS: $10 IN 2013, $51 b IN 2015, $242 b in 2020

TOTAL DE3FICIT REDUCTION:  $164 b in 2013, $357 b in 2015, $817 b in 2020

CUMULATIVE DEFICIT REDUCTION BY 2020:  $ 3,885 billion

So like virtually every budget proposal, S--B is loaded in the outyears.  Have you seen any plan that DOESN'T load savings in the outyears?  So this is clearly a specious argument on your part and you should be ashamed to have brought it up.  Think about talking points before you parrot them.  

So are we meeting the S--B targets?  I'll have to crunch CBO numbers (the baseline changed in Dec 2011) and post later, but I think it's safe to say that spending cuts for 2012 and 2013 will be small in absolute size but significant compared to goals, while the progress on revenue measures right now is absolutely ZIP.  

So sharpen your pencils, fire up your spreadsheet, and read the footnotes in the published reports.  And remember that political bloggers of any stripe are not going to help you any in this; you have to understand and be able to explain the conclusions they arrive at.


----------



## Trajan

I saw this at Cato, says a lot for a pretty simple chart, David Gregory on Meet the Depressed was doing his level best to misrepresent what really happened and the other mouthpiece at Fake the Nation did same....



Its spending folks, and always has been and defense is not the villain and never has been. I am NOT saying Defense cannot take some cuts,  lord yes they can, but it is NOT and never has been a panacea. 









Meet the Press, Check the Facts | Cato @ Liberty


----------



## saveliberty

It would be helpful to see how GDP grew during those same time periods was well.


----------



## Trajan

saveliberty said:


> It would be helpful to see how GDP grew during those same time periods was well.



dude, gee whiz thats a lot of work....google

I have this;


you can go to the site and zero in further by changing the data sets, I ran the federal fiscal years- oct 47 to nov. 2012-






http://www.tradingeconomics.com/united-states/gdp-growth


----------



## saveliberty

I see Clinton experienced pretty high GDP growth during his term.  It magnifies his negative growth.


----------



## Wiseacre

saveliberty said:


> I see Clinton experienced pretty high GDP growth during his term.  It magnifies his negative growth.




Clinton was one lucky SOB, first he gets Ross Perot to divide the conservative vote and get elected, at a time when the US economy was just starting to boom.   At least he was smart enough to work with the Gingrich House to get something done in his 2nd term.   I remember they had something of a standoff for awhile, before they found a way to compromise.   Wonder if Obama will do the same;  kinda doubt it but we'll see.


----------



## Trajan

saveliberty said:


> I see Clinton experienced pretty high GDP growth during his term.  It magnifies his negative growth.




Negative Growth?


----------



## Sactowndog

Wiseacre said:


> Sactowndog said:
> 
> 
> 
> 
> 
> PaulS1950 said:
> 
> 
> 
> Since the national debt is growing at over 1 trillion dollars a year I doubt that 2 trillion dollars in cuts and taxes over ten years is going to make much difference. In the last year of his first term the Obama administation added 3 trillion dollars to the debt.
> 
> Its already over folks - we are hemaraging our life away and darn few are paying attention. In less than twenty years we will go bankrupt. A nation cannot go on spending trillions more than they bring in in taxes - borrowing what they don't bring in and paying only the interest on the loans. Eventually you have to borrow to pay the interest - Bankrupt!
> 
> 
> 
> 
> Paul you are right but the problem rest squarely with the GOP.  The are prioritizing tax cuts for the wealthy over spending cuts and reforming entitlements.  If the GOP reversed those priorities we would have a deal done quickly and between the tax increase and spending cuts we would have made real progress on the deficit.
> 
> This model was followed by Clinton and the Republican congress to make real progress and the deficit and the economy did well as a result as people believed we would not be spending ourselves into bankrauptcy.
> 
> Click to expand...
> 
> 
> The Clinton era surplus was due to TAX CUTS and SPENDING CUTS that Clinton had to swallow.    Guys like you always blame the GOP, but I don't see the democrats offering any reforms to the entitlement programs.   Every deomcrat I see on TV is saying hell no, we can't have that!
> 
> The truth is that you guys want complete capitulation, total surrender.   You don't want cooperation or compromise, you want it all your way.   Sorry dude, Obama may have been re-elected but so did the House republicans.
Click to expand...


This is incorrect on many levels.  Clinton raised them to 39%.  You also state "you guys want complete capitulation".  Well I would agree that liberal democrats like Nancy Pelosi want complete capitulation but that certainly isn't what I want.  I want to see the budget deficit addressed.  

To me that means Republicans should prioritize spending cuts and entitlement reform first.  If they really cared about the deficit this would be their focus instead of preventing us from returning to the tax rates of the Clinton era.  

When I see the Republicans really prioritizing spending cuts and entitlement reform by making those the key trade-offs instead of taxes for the wealthy.


----------



## Wiseacre

Sactowndog said:


> Wiseacre said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> Paul you are right but the problem rest squarely with the GOP.  The are prioritizing tax cuts for the wealthy over spending cuts and reforming entitlements.  If the GOP reversed those priorities we would have a deal done quickly and between the tax increase and spending cuts we would have made real progress on the deficit.
> 
> This model was followed by Clinton and the Republican congress to make real progress and the deficit and the economy did well as a result as people believed we would not be spending ourselves into bankrauptcy.
> 
> 
> 
> 
> The Clinton era surplus was due to TAX CUTS and SPENDING CUTS that Clinton had to swallow.    Guys like you always blame the GOP, but I don't see the democrats offering any reforms to the entitlement programs.   Every deomcrat I see on TV is saying hell no, we can't have that!
> 
> The truth is that you guys want complete capitulation, total surrender.   You don't want cooperation or compromise, you want it all your way.   Sorry dude, Obama may have been re-elected but so did the House republicans.
> 
> Click to expand...
> 
> 
> This is incorrect on many levels.  Clinton raised them to 39%.  You also state "you guys want complete capitulation".  Well I would agree that liberal democrats like Nancy Pelosi want complete capitulation but that certainly isn't what I want.  I want to see the budget deficit addressed.
> 
> You do know the repubs got some tax cuts passed under Clinton, right?   Not on the top rate, actually it wasn't that much EXCEPT they lowered the cap gains tax, and that makes a difference to investors.   From 28% down to 20%, and after that was when Clinton got his surplus.   Of sorts.
> 
> To me that means Republicans should prioritize spending cuts and entitlement reform first.  If they really cared about the deficit this would be their focus instead of preventing us from returning to the tax rates of the Clinton era.
> 
> When I see the Republicans really prioritizing spending cuts and entitlement reform by making those the key trade-offs instead of taxes for the wealthy.
Click to expand...



Will it make much difference what the repubs do about spending cuts and entitlement reform if the democrats will not negotiate over it?   I  mean real cuts now instead of in the future.   I'd like to think people from both sides are dickering over what to cut, and also how to reform the entitlements AND the tax code.   Why do you put the onus just on the repubs, don't the dems have an equal duty to bargain in good faith?


----------



## The Rabbi

Sactowndog said:


> Wiseacre said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> Paul you are right but the problem rest squarely with the GOP.  The are prioritizing tax cuts for the wealthy over spending cuts and reforming entitlements.  If the GOP reversed those priorities we would have a deal done quickly and between the tax increase and spending cuts we would have made real progress on the deficit.
> 
> This model was followed by Clinton and the Republican congress to make real progress and the deficit and the economy did well as a result as people believed we would not be spending ourselves into bankrauptcy.
> 
> 
> 
> 
> The Clinton era surplus was due to TAX CUTS and SPENDING CUTS that Clinton had to swallow.    Guys like you always blame the GOP, but I don't see the democrats offering any reforms to the entitlement programs.   Every deomcrat I see on TV is saying hell no, we can't have that!
> 
> The truth is that you guys want complete capitulation, total surrender.   You don't want cooperation or compromise, you want it all your way.   Sorry dude, Obama may have been re-elected but so did the House republicans.
> 
> Click to expand...
> 
> 
> This is incorrect on many levels.  Clinton raised them to 39%.  You also state "you guys want complete capitulation".  Well I would agree that liberal democrats like Nancy Pelosi want complete capitulation but that certainly isn't what I want.  I want to see the budget deficit addressed.
> 
> To me that means Republicans should prioritize spending cuts and entitlement reform first.  If they really cared about the deficit this would be their focus instead of preventing us from returning to the tax rates of the Clinton era.
> 
> When I see the Republicans really prioritizing spending cuts and entitlement reform by making those the key trade-offs instead of taxes for the wealthy.
Click to expand...


The GOP has proposed reforms that will bring in more money than simply raising rates. It is the Dems who are fixated on raising rates, esp on cap gains, even though even they acknowledge it will bring in less money.  They want to ride to victory in elections telling middle and low income voters how they punished the wealthy.  That's all it is.


----------



## saveliberty

...or they could just push this off til midterm elections...


----------



## Trajan

Sactowndog said:


> Wiseacre said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> Paul you are right but the problem rest squarely with the GOP.  The are prioritizing tax cuts for the wealthy over spending cuts and reforming entitlements.  If the GOP reversed those priorities we would have a deal done quickly and between the tax increase and spending cuts we would have made real progress on the deficit.
> 
> This model was followed by Clinton and the Republican congress to make real progress and the deficit and the economy did well as a result as people believed we would not be spending ourselves into bankrauptcy.
> 
> 
> 
> 
> The Clinton era surplus was due to TAX CUTS and SPENDING CUTS that Clinton had to swallow.    Guys like you always blame the GOP, but I don't see the democrats offering any reforms to the entitlement programs.   Every deomcrat I see on TV is saying hell no, we can't have that!
> 
> The truth is that you guys want complete capitulation, total surrender.   You don't want cooperation or compromise, you want it all your way.   Sorry dude, Obama may have been re-elected but so did the House republicans.
> 
> Click to expand...
> 
> 
> This is incorrect on many levels.  Clinton raised them to 39%.  You also state "you guys want complete capitulation".  Well I would agree that liberal democrats like Nancy Pelosi want complete capitulation but that certainly isn't what I want.  I want to see the budget deficit addressed.
> 
> To me that means Republicans should prioritize spending cuts and entitlement reform first.  If they really cared about the deficit this would be their focus instead of preventing us from returning to the tax rates of the Clinton era.
> 
> When I see the Republicans really prioritizing spending cuts and entitlement reform by making those the key trade-offs instead of taxes for the wealthy.
Click to expand...


they are fighting the battle before them, they want entitlement reform and have said so, and they have said they want to change the appropriation structure process to curtail Baseline spending, which is the REAL issue. the rate change is the smoke screen , and thats what obama is still campaigning on, if you want to blame someone blame the media how just want the red meat. .


----------



## Trajan

Wiseacre said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> The Clinton era surplus was due to TAX CUTS and SPENDING CUTS that Clinton had to swallow.    Guys like you always blame the GOP, but I don't see the democrats offering any reforms to the entitlement programs.   Every deomcrat I see on TV is saying hell no, we can't have that!
> 
> The truth is that you guys want complete capitulation, total surrender.   You don't want cooperation or compromise, you want it all your way.   Sorry dude, Obama may have been re-elected but so did the House republicans.
> 
> 
> 
> 
> This is incorrect on many levels.  Clinton raised them to 39%.  You also state "you guys want complete capitulation".  Well I would agree that liberal democrats like Nancy Pelosi want complete capitulation but that certainly isn't what I want.  I want to see the budget deficit addressed.
> 
> You do know the repubs got some tax cuts passed under Clinton, right?   Not on the top rate, actually it wasn't that much EXCEPT they lowered the cap gains tax, and that makes a difference to investors.   From 28% down to 20%, and after that was when Clinton got his surplus.   Of sorts.
> 
> To me that means Republicans should prioritize spending cuts and entitlement reform first.  If they really cared about the deficit this would be their focus instead of preventing us from returning to the tax rates of the Clinton era.
> 
> When I see the Republicans really prioritizing spending cuts and entitlement reform by making those the key trade-offs instead of taxes for the wealthy.
> 
> Click to expand...
> 
> 
> 
> Will it make much difference what the repubs do about spending cuts and entitlement reform if the democrats will not negotiate over it?   I  mean real cuts now instead of in the future.   I'd like to think people from both sides are dickering over what to cut, and also how to reform the entitlements AND the tax code.   Why do you put the onus just on the repubs, don't the dems have an equal duty to bargain in good faith?
Click to expand...


if the media were playing this fairly, they would have burped up that debate where in obama even after being told by Gibson that cap gains being jacked lowers receipts in the long run and obama said it was a a matter of fairness........not economics mind you,  but 'fairness'. 

_
GIBSON: All right. You have, however, said you would favor an increase in the capital gains tax. As a matter of fact, you said on CNBC, and I quote, "I certainly would not go above what existed under Bill Clinton," which was 28 percent. It's now 15 percent. That's almost a doubling, if you went to 28 percent.

But actually, Bill Clinton, in 1997, signed legislation that dropped the capital gains tax to 20 percent.

OBAMA: Right.

GIBSON: And George Bush has taken it down to 15 percent.

OBAMA: Right.

GIBSON: And in each instance, when the rate dropped, revenues from the tax increased; the government took in more money. And in the 1980s, when the tax was increased to 28 percent, the revenues went down.

So why raise it at all, especially given the fact that 100 million people in this country own stock and would be affected?

OBAMA: Well, Charlie, what I've said is that I would look at raising the capital gains tax for purposes of fairness._

that last comment  is outrageous,  seriously....


but they focus on Grover Norquist who has been repudiated to the point here its just a smokescreen now.....


----------



## kiwiman127

Wiseacre said:


> saveliberty said:
> 
> 
> 
> I see Clinton experienced pretty high GDP growth during his term.  It magnifies his negative growth.
> 
> 
> 
> 
> 
> Clinton was one lucky SOB, first he gets Ross Perot to divide the conservative vote and get elected, at a time when the US economy was just starting to boom.   At least he was smart enough to work with the Gingrich House to get something done in his 2nd term.   I remember they had something of a standoff for awhile, before they found a way to compromise.   Wonder if Obama will do the same;  kinda doubt it but we'll see.
Click to expand...


Compromise! It's the magic word.  It would be great if both sides could be work more like a team and get things done, rather as enemies and accomplish nothing.


----------



## Wiseacre

kiwiman127 said:


> Wiseacre said:
> 
> 
> 
> 
> 
> saveliberty said:
> 
> 
> 
> I see Clinton experienced pretty high GDP growth during his term.  It magnifies his negative growth.
> 
> 
> 
> 
> 
> Clinton was one lucky SOB, first he gets Ross Perot to divide the conservative vote and get elected, at a time when the US economy was just starting to boom.   At least he was smart enough to work with the Gingrich House to get something done in his 2nd term.   I remember they had something of a standoff for awhile, before they found a way to compromise.   Wonder if Obama will do the same;  kinda doubt it but we'll see.
> 
> Click to expand...
> 
> 
> Compromise! It's the magic word.  It would be great if both sides could be work more like a team and get things done, rather as enemies and accomplish nothing.
Click to expand...



Clinton did it.   Every other president managed to work with the opposition, why can't Obama?   Answer:  cuz he doesn't want to.


----------



## Trajan

Wiseacre said:


> kiwiman127 said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> Clinton was one lucky SOB, first he gets Ross Perot to divide the conservative vote and get elected, at a time when the US economy was just starting to boom.   At least he was smart enough to work with the Gingrich House to get something done in his 2nd term.   I remember they had something of a standoff for awhile, before they found a way to compromise.   Wonder if Obama will do the same;  kinda doubt it but we'll see.
> 
> 
> 
> 
> Compromise! It's the magic word.  It would be great if both sides could be work more like a team and get things done, rather as enemies and accomplish nothing.
> 
> Click to expand...
> 
> 
> 
> Clinton did it.   Every other president managed to work with the opposition, why can't Obama?   Answer:  cuz he doesn't want to.
Click to expand...


thats the way it seems, he hasn't said a word since boehner gave him a counter offer and he is going to disappear on vacation now.

Personally NONE of them should go anywhere until this is done. BUT- I have a feeling that Obama wants it to go to the last minute. 


I have made this point before and will again- in 194 and half of 65, when Medicare/Medicaid was passed in July 65, LBJ had 65 dem. senators and 255 dems in the house, he didn't need 1 gop vote. BUT he got 45% of the gop senators to vote yea and over half the house reps too ( the bill was just 296 pages btw). He did that not by shutting shouting them out but by cajolery and compromise. 


and, here is the cloture vote on the SS act of 1965-

House of Representatives

Democrats
237 &#8211; Yea
48 &#8211; Nay
8 &#8211; Not Voting

Republicans
70 &#8211; Yea
68 &#8211; Nay
2 &#8211; Not Voting

Senate

Democrats
57 &#8211; Yea
7 &#8211; Nay
4- Not Voting

Republicans
13 &#8211; Yea
17 &#8211; Nay
2 &#8211; Not Voting

Why? Because he knew that in order for it to work down the road, he had to have everyone on board, even if to share the blame ( and there is plenty to share but thats another story).  And there was plenty of opposition to Medicare, it was no slamdunk, they passed Kerr-Mills in 1960, first which was just a prgm for the  indigent etc. and took up the battle there after.... .


----------



## Sactowndog

Wiseacre said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> The Clinton era surplus was due to TAX CUTS and SPENDING CUTS that Clinton had to swallow.    Guys like you always blame the GOP, but I don't see the democrats offering any reforms to the entitlement programs.   Every deomcrat I see on TV is saying hell no, we can't have that!
> 
> The truth is that you guys want complete capitulation, total surrender.   You don't want cooperation or compromise, you want it all your way.   Sorry dude, Obama may have been re-elected but so did the House republicans.
> 
> 
> 
> 
> This is incorrect on many levels.  Clinton raised them to 39%.  You also state "you guys want complete capitulation".  Well I would agree that liberal democrats like Nancy Pelosi want complete capitulation but that certainly isn't what I want.  I want to see the budget deficit addressed.
> 
> You do know the repubs got some tax cuts passed under Clinton, right?   Not on the top rate, actually it wasn't that much EXCEPT they lowered the cap gains tax, and that makes a difference to investors.   From 28% down to 20%, and after that was when Clinton got his surplus.   Of sorts.
> 
> To me that means Republicans should prioritize spending cuts and entitlement reform first.  If they really cared about the deficit this would be their focus instead of preventing us from returning to the tax rates of the Clinton era.
> 
> When I see the Republicans really prioritizing spending cuts and entitlement reform by making those the key trade-offs instead of taxes for the wealthy.
> 
> Click to expand...
> 
> 
> 
> Will it make much difference what the repubs do about spending cuts and entitlement reform if the democrats will not negotiate over it?   I  mean real cuts now instead of in the future.   I'd like to think people from both sides are dickering over what to cut, and also how to reform the entitlements AND the tax code.   Why do you put the onus just on the repubs, don't the dems have an equal duty to bargain in good faith?
Click to expand...


Because currently I see the Republican leadership prioritizing protecting the tax cuts for the wealthy above all else.  I have heard and believe Obama would push Medicare cuts to the Democratic Party leftists if the Republicans would bend on taxes.  I am willing to be proven wrong but only when the Republicans set aside their opposition to the tax hike and focus on entitlement reform.  At that point if Obama doesn't move my perspective will shift.  

Luckily some pragmatic Republicans who really care about the deficit are coming to this conclusion.  Unfortunately none of them are in the leadership.  I truely think this is what the voters want by returning both Obama and the Republican congress.


----------



## Sactowndog

Trajan said:


> Wiseacre said:
> 
> 
> 
> 
> 
> kiwiman127 said:
> 
> 
> 
> Compromise! It's the magic word.  It would be great if both sides could be work more like a team and get things done, rather as enemies and accomplish nothing.
> 
> 
> 
> 
> 
> Clinton did it.   Every other president managed to work with the opposition, why can't Obama?   Answer:  cuz he doesn't want to.
> 
> Click to expand...
> 
> 
> thats the way it seems, he hasn't said a word since boehner gave him a counter offer and he is going to disappear on vacation now.
> 
> Personally NONE of them should go anywhere until this is done. BUT- I have a feeling that Obama wants it to go to the last minute.
> 
> 
> I have made this point before and will again- in 194 and half of 65, when Medicare/Medicaid was passed in July 65, LBJ had 65 dem. senators and 255 dems in the house, he didn't need 1 gop vote. BUT he got 45% of the gop senators to vote yea and over half the house reps too ( the bill was just 296 pages btw). He did that not by shutting shouting them out but by cajolery and compromise.
> 
> 
> and, here is the cloture vote on the SS act of 1965-
> 
> House of Representatives
> 
> Democrats
> 237  Yea
> 48  Nay
> 8  Not Voting
> 
> Republicans
> 70  Yea
> 68  Nay
> 2  Not Voting
> 
> Senate
> 
> Democrats
> 57  Yea
> 7  Nay
> 4- Not Voting
> 
> Republicans
> 13  Yea
> 17  Nay
> 2  Not Voting
> 
> Why? Because he knew that in order for it to work down the road, he had to have everyone on board, even if to share the blame ( and there is plenty to share but thats another story).  And there was plenty of opposition to Medicare, it was no slamdunk, they passed Kerr-Mills in 1960, first which was just a prgm for the  indigent etc. and took up the battle there after.... .
Click to expand...



That was a very different generation that worked together to win WW2 and had a history of setting aside differences to focus on the common good.  This Congress is led by boomers who have a history of taking ideologically extreme positions and has been labeled as the me generation.  

I think this is as much generational and a failure of the boomer generation as many other factors.


----------



## Sactowndog

Trajan said:


> Wiseacre said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> This is incorrect on many levels.  Clinton raised them to 39%.  You also state "you guys want complete capitulation".  Well I would agree that liberal democrats like Nancy Pelosi want complete capitulation but that certainly isn't what I want.  I want to see the budget deficit addressed.
> 
> You do know the repubs got some tax cuts passed under Clinton, right?   Not on the top rate, actually it wasn't that much EXCEPT they lowered the cap gains tax, and that makes a difference to investors.   From 28% down to 20%, and after that was when Clinton got his surplus.   Of sorts.
> 
> To me that means Republicans should prioritize spending cuts and entitlement reform first.  If they really cared about the deficit this would be their focus instead of preventing us from returning to the tax rates of the Clinton era.
> 
> When I see the Republicans really prioritizing spending cuts and entitlement reform by making those the key trade-offs instead of taxes for the wealthy.
> 
> 
> 
> 
> 
> Will it make much difference what the repubs do about spending cuts and entitlement reform if the democrats will not negotiate over it?   I  mean real cuts now instead of in the future.   I'd like to think people from both sides are dickering over what to cut, and also how to reform the entitlements AND the tax code.   Why do you put the onus just on the repubs, don't the dems have an equal duty to bargain in good faith?
> 
> Click to expand...
> 
> 
> if the media were playing this fairly, they would have burped up that debate where in obama even after being told by Gibson that cap gains being jacked lowers receipts in the long run and obama said it was a a matter of fairness........not economics mind you,  but 'fairness'.
> 
> _
> GIBSON: All right. You have, however, said you would favor an increase in the capital gains tax. As a matter of fact, you said on CNBC, and I quote, "I certainly would not go above what existed under Bill Clinton," which was 28 percent. It's now 15 percent. That's almost a doubling, if you went to 28 percent.
> 
> But actually, Bill Clinton, in 1997, signed legislation that dropped the capital gains tax to 20 percent.
> 
> OBAMA: Right.
> 
> GIBSON: And George Bush has taken it down to 15 percent.
> 
> OBAMA: Right.
> 
> GIBSON: And in each instance, when the rate dropped, revenues from the tax increased; the government took in more money. And in the 1980s, when the tax was increased to 28 percent, the revenues went down.
> 
> So why raise it at all, especially given the fact that 100 million people in this country own stock and would be affected?
> 
> OBAMA: Well, Charlie, what I've said is that I would look at raising the capital gains tax for purposes of fairness._
> 
> that last comment  is outrageous,  seriously....
> 
> 
> but they focus on Grover Norquist who has been repudiated to the point here its just a smokescreen now.....
Click to expand...


Again this is completely wrong and misleading.  Yes the vast majority of people own stock but for a high percentage of those people the stock is held in 401K's and will never be subject to the capital gains tax.  All disbursements from a 401K are subject to Income Tax.  

The Capital Gains tax rates are one of the poorest choices we make in the tax code, given that today most wealthy who would hold stock outside of 401K's diversify their portfolios globally.  Why should we provide an incentive rate to invest in China?  Those who are creating jobs in China should not be getting a break for funding the government in the United States.  

If you care about jobs reduce the Corporate Income tax because that benefits investors who put money in the US from all countries.


----------



## Trajan

Sactowndog said:


> Trajan said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> Clinton did it.   Every other president managed to work with the opposition, why can't Obama?   Answer:  cuz he doesn't want to.
> 
> 
> 
> 
> thats the way it seems, he hasn't said a word since boehner gave him a counter offer and he is going to disappear on vacation now.
> 
> Personally NONE of them should go anywhere until this is done. BUT- I have a feeling that Obama wants it to go to the last minute.
> 
> 
> I have made this point before and will again- in 194 and half of 65, when Medicare/Medicaid was passed in July 65, LBJ had 65 dem. senators and 255 dems in the house, he didn't need 1 gop vote. BUT he got 45% of the gop senators to vote yea and over half the house reps too ( the bill was just 296 pages btw). He did that not by shutting shouting them out but by cajolery and compromise.
> 
> 
> and, here is the cloture vote on the SS act of 1965-
> 
> House of Representatives
> 
> Democrats
> 237  Yea
> 48  Nay
> 8  Not Voting
> 
> Republicans
> 70  Yea
> 68  Nay
> 2  Not Voting
> 
> Senate
> 
> Democrats
> 57  Yea
> 7  Nay
> 4- Not Voting
> 
> Republicans
> 13  Yea
> 17  Nay
> 2  Not Voting
> 
> Why? Because he knew that in order for it to work down the road, he had to have everyone on board, even if to share the blame ( and there is plenty to share but thats another story).  And there was plenty of opposition to Medicare, it was no slamdunk, they passed Kerr-Mills in 1960, first which was just a prgm for the  indigent etc. and took up the battle there after.... .
> 
> Click to expand...
> 
> 
> 
> That was a very different generation that worked together to win WW2 and had a history of setting aside differences to focus on the common good.  This Congress is led by boomers who have a history of taking ideologically extreme positions and has been labeled as the me generation.
> 
> I think this is as much generational and a failure of the boomer generation as many other factors.
Click to expand...


you are making an argument in/of mitigation. 


 and so what? Clinton was of what generation?


----------



## Trajan

Sactowndog said:


> Trajan said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> Will it make much difference what the repubs do about spending cuts and entitlement reform if the democrats will not negotiate over it?   I  mean real cuts now instead of in the future.   I'd like to think people from both sides are dickering over what to cut, and also how to reform the entitlements AND the tax code.   Why do you put the onus just on the repubs, don't the dems have an equal duty to bargain in good faith?
> 
> 
> 
> 
> if the media were playing this fairly, they would have burped up that debate where in obama even after being told by Gibson that cap gains being jacked lowers receipts in the long run and obama said it was a a matter of fairness........not economics mind you,  but 'fairness'.
> 
> _
> GIBSON: All right. You have, however, said you would favor an increase in the capital gains tax. As a matter of fact, you said on CNBC, and I quote, "I certainly would not go above what existed under Bill Clinton," which was 28 percent. It's now 15 percent. That's almost a doubling, if you went to 28 percent.
> 
> But actually, Bill Clinton, in 1997, signed legislation that dropped the capital gains tax to 20 percent.
> 
> OBAMA: Right.
> 
> GIBSON: And George Bush has taken it down to 15 percent.
> 
> OBAMA: Right.
> 
> GIBSON: And in each instance, when the rate dropped, revenues from the tax increased; the government took in more money. And in the 1980s, when the tax was increased to 28 percent, the revenues went down.
> 
> So why raise it at all, especially given the fact that 100 million people in this country own stock and would be affected?
> 
> OBAMA: Well, Charlie, what I've said is that I would look at raising the capital gains tax for purposes of fairness._
> 
> that last comment  is outrageous,  seriously....
> 
> 
> but they focus on Grover Norquist who has been repudiated to the point here its just a smokescreen now.....
> 
> Click to expand...
> 
> 
> Again this is completely wrong and misleading.  Yes the vast majority of people own stock but for a high percentage of those people the stock is held in 401K's and will never be subject to the capital gains tax.  All disbursements from a 401K are subject to Income Tax.
> 
> The Capital Gains tax rates are one of the poorest choices we make in the tax code, given that today most wealthy who would hold stock outside of 401K's diversify their portfolios globally.  Why should we provide an incentive rate to invest in China?  Those who are creating jobs in China should not be getting a break for funding the government in the United States.
> 
> 
> 
> 
> 
> 
> If you care about jobs reduce the Corporate Income tax because that benefits investors who put money in the US from all countries.
> 
> Click to expand...
> 
> 
> I agree with that but what you said about 401k's being stock portfolios is "misleading'" you get co. stock by grant and discount purchase price in THAT co., it doesn't go into your 401K.
> 
> and that has what to do with revenue?
> 
> as far as poor choice, risk taken should be rewarded. they get  rate not based on income level,  becasue it is NOT income tax as we know it, taking a check form a job incurs zero risk, so thats probably as fair as it can get, most especially since you can only write off 3K in losses a year. And if they invest in China well so what? If you are against providing cap. gains rates to an investment made in china, which is taxed when it comes home, then you must be against free trade....are you?
Click to expand...


----------



## oldfart

Wiseacre said:


> This is consistent with a new paper called The Design of Fiscal Adjustments, by Harvard economists Alberto Alesina and Silvia Ardagna. Building up on their previous work, they provide even more evidence that fiscal consolidations based mostly on the spending side result in smaller recessions, or none at all, when compared to tax-based adjustments. Additionally, they find that private investment tends to react more positively to spending-based adjustments. Thus, they argue that spending cuts are more sustainable and effective in reducing debt and raising economic growth; expansionary fiscal consolidation is possible.



These are the folks who invented the idea of "expansionary austerity" the most thoroughly discredited intellectual disaster in economic thought in a half-century.   They point to Ireland as an outstanding success. They convinced the Cameron government o try austerity.  Notice the resulting train wreck.  The IMF has reversed policy 180 degrees, first joining the bandwagon and now seeing the devestation, deciding to completely reverse policy.  In dozens of countries those who chose austerity have decimated their economies to the point of financial and social collapse.  Recovery is only occuring where people did not drink the koolaid.  I have not seen an economic theory so discredited in practice since Andrew Mellon was Secretary of the Treasury, and look how that turned out.  

PLEASE, PLEASE, do not try to use anything by A & A to justify anything.  This was a bad idea from the git-go with no foundation in economic theory at all, no support in the historical record, and now a horrible track record in application.  In a just world they would be tried for crimes against humanity.  

And if you did not realize that this paper was proposing expansionary austerity, then I would say that you have had a lot of company and that there are much worse things than being bamboozled.


----------



## Wiseacre

oldfart said:


> Wiseacre said:
> 
> 
> 
> This is consistent with a new paper called &#8220;The Design of Fiscal Adjustments,&#8221; by Harvard economists Alberto Alesina and Silvia Ardagna. Building up on their previous work, they provide even more evidence that fiscal consolidations based mostly on the spending side result in smaller recessions, or none at all, when compared to tax-based adjustments. Additionally, they find that private investment tends to react more positively to spending-based adjustments. Thus, they argue that spending cuts are more sustainable and effective in reducing debt and raising economic growth; expansionary fiscal consolidation is possible.
> 
> 
> 
> 
> These are the folks who invented the idea of "expansionary austerity" the most thoroughly discredited intellectual disaster in economic thought in a half-century.   They point to Ireland as an outstanding success. They convinced the Cameron government o try austerity.  Notice the resulting train wreck.  The IMF has reversed policy 180 degrees, first joining the bandwagon and now seeing the devestation, deciding to completely reverse policy.  In dozens of countries those who chose austerity have decimated their economies to the point of financial and social collapse.  Recovery is only occuring where people did not drink the koolaid.  I have not seen an economic theory so discredited in practice since Andrew Mellon was Secretary of the Treasury, and look how that turned out.
> 
> PLEASE, PLEASE, do not try to use anything by A & A to justify anything.  This was a bad idea from the git-go with no foundation in economic theory at all, no support in the historical record, and now a horrible track record in application.  In a just world they would be tried for crimes against humanity.
> 
> And if you did not realize that this paper was proposing expansionary austerity, then I would say that you have had a lot of company and that there are much worse things than being bamboozled.
Click to expand...



You're bashing Harvard economists?   HAHVAHD?   What's the world coming to.

What about Estonia and the other Baltic States?   Did they not severely cut spending instead of significantly raising taxes?    Worked out well for them, Estonia is the only EU nation that is in surplus according to this:

Let&#8217;s Copy the Baltic Nations and Really Cut Spending « International Liberty

and this:

http://danieljmitchell.wordpress.co...ity-another-exploding-cigar-for-paul-krugman/

A lot of the EU countries that are in dire economic straights didn't really cut spending, they raised taxes instead.   And their economies suffered.   Spending cuts are no picnic either, those Baltic countries went through a lot of pain for a few years.   I'm not saying you gotta go big all at once and balance the budget;  I'd be good with a gradual reduction to the point where spending increases do not exceed GDP growth.   And I'd be good with higher taxes if and when the economic experiences sustained growth and UE drops because we're creating a lot more jobs rather than because 350,000 people left the workforce.

But I also think we and those European countries have to restructure their social contract;  deals and promises were made that cannot be kept.   And nobody is willing to do that, so the can gets kicked and the problems get bigger and worser.   And the really bad part is, future generations will have to deal with the consequences of our prolificacy.


----------



## saveliberty

oldfart said:


> Wiseacre said:
> 
> 
> 
> This is consistent with a new paper called The Design of Fiscal Adjustments, by Harvard economists Alberto Alesina and Silvia Ardagna. Building up on their previous work, they provide even more evidence that fiscal consolidations based mostly on the spending side result in smaller recessions, or none at all, when compared to tax-based adjustments. Additionally, they find that private investment tends to react more positively to spending-based adjustments. Thus, they argue that spending cuts are more sustainable and effective in reducing debt and raising economic growth; expansionary fiscal consolidation is possible.
> 
> 
> 
> 
> These are the folks who invented the idea of "expansionary austerity" the most thoroughly discredited intellectual disaster in economic thought in a half-century.   They point to Ireland as an outstanding success. They convinced the Cameron government o try austerity.  Notice the resulting train wreck.  The IMF has reversed policy 180 degrees, first joining the bandwagon and now seeing the devestation, deciding to completely reverse policy.  In dozens of countries those who chose austerity have decimated their economies to the point of financial and social collapse.  Recovery is only occuring where people did not drink the koolaid.  I have not seen an economic theory so discredited in practice since Andrew Mellon was Secretary of the Treasury, and look how that turned out.
> 
> PLEASE, PLEASE, do not try to use anything by A & A to justify anything.  This was a bad idea from the git-go with no foundation in economic theory at all, no support in the historical record, and now a horrible track record in application.  In a just world they would be tried for crimes against humanity.
> 
> And if you did not realize that this paper was proposing expansionary austerity, then I would say that you have had a lot of company and that there are much worse things than being bamboozled.
Click to expand...


The austerity program was never implemented as suggested.  It never reached the level it should have in a short period of time.  Since it was watered down, it never achieved its intended effect.  Cutting spending is common sense.  Spending your way out of debt is the lunatic approach.


----------



## Sactowndog

Foxfyre said:


> Trajan said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> The Clinton era surplus was due to TAX CUTS and SPENDING CUTS that Clinton had to swallow.    Guys like you always blame the GOP, but I don't see the democrats offering any reforms to the entitlement programs.   Every deomcrat I see on TV is saying hell no, we can't have that!
> 
> The truth is that you guys want complete capitulation, total surrender.   You don't want cooperation or compromise, you want it all your way.   Sorry dude, Obama may have been re-elected but so did the House republicans.
> 
> 
> 
> 
> Any Clintonesque centrism etc. has gone by the wayside bro- like the Old Guard marching up that slope to oblivion at Waterloo, Pelosi marched every blue dog into the cannon of obamacare, yet its the extremist gop that wants to cut back the $830Bn and then some from every obama spending year there after 2009, as he attmpts to enshrine it in a new baseline for the future, thats why they won't do a budget, they can't, so we roll on Continuing Resolutions.
> 
> Click to expand...
> 
> 
> And that is the problem.  The Democrats have veered so far left, there is little common ground anywhere with the Republicans who have also shifted left but not far enough to find any middle ground.  Plus many Republicans have the additional problem of making a solemn promise of fiscal responsibility in order to get elected in the first place, and if they capitulate on raising income taxes and some other measures, they break that pledge.
Click to expand...


You do know that most of the world views both parties as center right parties?


----------



## Trajan

Sactowndog said:


> Foxfyre said:
> 
> 
> 
> 
> 
> Trajan said:
> 
> 
> 
> Any Clintonesque centrism etc. has gone by the wayside bro- like the Old Guard marching up that slope to oblivion at Waterloo, Pelosi marched every blue dog into the cannon of obamacare, yet its the extremist gop that wants to cut back the $830Bn and then some from every obama spending year there after 2009, as he attmpts to enshrine it in a new baseline for the future, thats why they won't do a budget, they can't, so we roll on Continuing Resolutions.
> 
> 
> 
> 
> And that is the problem.  The Democrats have veered so far left, there is little common ground anywhere with the Republicans who have also shifted left but not far enough to find any middle ground.  Plus many Republicans have the additional problem of making a solemn promise of fiscal responsibility in order to get elected in the first place, and if they capitulate on raising income taxes and some other measures, they break that pledge.
> 
> Click to expand...
> 
> 
> You do know that most of the world views both parties as center right parties?
Click to expand...


and that is germane how? who cares?


----------



## Sactowndog

Trajan said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Trajan said:
> 
> 
> 
> thats the way it seems, he hasn't said a word since boehner gave him a counter offer and he is going to disappear on vacation now.
> 
> Personally NONE of them should go anywhere until this is done. BUT- I have a feeling that Obama wants it to go to the last minute.
> 
> 
> I have made this point before and will again- in 194 and half of 65, when Medicare/Medicaid was passed in July 65, LBJ had 65 dem. senators and 255 dems in the house, he didn't need 1 gop vote. BUT he got 45% of the gop senators to vote yea and over half the house reps too ( the bill was just 296 pages btw). He did that not by shutting shouting them out but by cajolery and compromise.
> 
> 
> and, here is the cloture vote on the SS act of 1965-
> 
> House of Representatives
> 
> Democrats
> 237  Yea
> 48  Nay
> 8  Not Voting
> 
> Republicans
> 70  Yea
> 68  Nay
> 2  Not Voting
> 
> Senate
> 
> Democrats
> 57  Yea
> 7  Nay
> 4- Not Voting
> 
> Republicans
> 13  Yea
> 17  Nay
> 2  Not Voting
> 
> Why? Because he knew that in order for it to work down the road, he had to have everyone on board, even if to share the blame ( and there is plenty to share but thats another story).  And there was plenty of opposition to Medicare, it was no slamdunk, they passed Kerr-Mills in 1960, first which was just a prgm for the  indigent etc. and took up the battle there after.... .
> 
> 
> 
> 
> 
> That was a very different generation that worked together to win WW2 and had a history of setting aside differences to focus on the common good.  This Congress is led by boomers who have a history of taking ideologically extreme positions and has been labeled as the me generation.
> 
> I think this is as much generational and a failure of the boomer generation as many other factors.
> 
> Click to expand...
> 
> 
> you are making an argument in/of mitigation.
> 
> 
> and so what? Clinton was of what generation?
Click to expand...


Clinton was the first and the Congressional leaders of that era were not boomers.  My point is the problem in not Obama specifically but then generation as a whole that has never learned to set aside their ideological extreme positions for the good of the country as a whole.


----------



## Sactowndog

Wiseacre said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> The Clinton era surplus was due to TAX CUTS and SPENDING CUTS that Clinton had to swallow.    Guys like you always blame the GOP, but I don't see the democrats offering any reforms to the entitlement programs.   Every deomcrat I see on TV is saying hell no, we can't have that!
> 
> The truth is that you guys want complete capitulation, total surrender.   You don't want cooperation or compromise, you want it all your way.   Sorry dude, Obama may have been re-elected but so did the House republicans.
> 
> 
> 
> 
> This is incorrect on many levels.  Clinton raised them to 39%.  You also state "you guys want complete capitulation".  Well I would agree that liberal democrats like Nancy Pelosi want complete capitulation but that certainly isn't what I want.  I want to see the budget deficit addressed.
> 
> You do know the repubs got some tax cuts passed under Clinton, right?   Not on the top rate, actually it wasn't that much EXCEPT they lowered the cap gains tax, and that makes a difference to investors.   From 28% down to 20%, and after that was when Clinton got his surplus.   Of sorts.
> 
> To me that means Republicans should prioritize spending cuts and entitlement reform first.  If they really cared about the deficit this would be their focus instead of preventing us from returning to the tax rates of the Clinton era.
> 
> When I see the Republicans really prioritizing spending cuts and entitlement reform by making those the key trade-offs instead of taxes for the wealthy.
> 
> Click to expand...
> 
> 
> 
> Will it make much difference what the repubs do about spending cuts and entitlement reform if the democrats will not negotiate over it?   I  mean real cuts now instead of in the future.   I'd like to think people from both sides are dickering over what to cut, and also how to reform the entitlements AND the tax code.   Why do you put the onus just on the repubs, don't the dems have an equal duty to bargain in good faith?
Click to expand...


I don't accept that Obama and some Democrats won't negotiate over it.  Everything I have seen and heard indicates they will if the Republicans give on tax increases for the wealthy.  

The Tax increase for the wealthy is the single largest impediment to reaching a deficit reduction deal and it is the Republicans blocking it.  We had an election and they lost on that question.  Time to move on a focus on entitlement reform.


----------



## oldfart

Inadvertent post.  Complete post follows.


----------



## Sactowndog

Sactowndog said:


> Trajan said:
> 
> 
> 
> Again this is completely wrong and misleading.  Yes the vast majority of people own stock but for a high percentage of those people the stock is held in 401K's and will never be subject to the capital gains tax.  All disbursements from a 401K are subject to Income Tax.
> 
> The Capital Gains tax rates are one of the poorest choices we make in the tax code, given that today most wealthy who would hold stock outside of 401K's diversify their portfolios globally.  Why should we provide an incentive rate to invest in China?  Those who are creating jobs in China should not be getting a break for funding the government in the United States.
> 
> 
> 
> 
> 
> 
> If you care about jobs reduce the Corporate Income tax because that benefits investors who put money in the US from all countries.
> 
> 
> 
> 
> I agree with that but what you said about 401k's being stock portfolios is "misleading'" you get co. stock by grant and discount purchase price in THAT co., it doesn't go into your 401K.
> 
> and that has what to do with revenue?
> 
> as far as poor choice, risk taken should be rewarded. they get  rate not based on income level,  becasue it is NOT income tax as we know it, taking a check form a job incurs zero risk, so thats probably as fair as it can get, most especially since you can only write off 3K in losses a year. And if they invest in China well so what? If you are against providing cap. gains rates to an investment made in china, which is taxed when it comes home, then you must be against free trade....are you?
> 
> Click to expand...
> 
> 
> A stock grant or option is different than a company match in a 401K.  The claim was that virtually everyone holds stock of some sort and a capital gains tax cut benefits everyone.  This statement is simply not true as the general public holds stock within their 401K and disbursements from a 401k are treated as income not capital gains.  Therefore a capital gain tax cut does not help much of the middle class.
> 
> Second capital gains apply to much more than risky venture capital start ups.  Items like dividends are not particularly risky and still qualify for a capital gains treatment.  Second, the only reason to provide a beneficial tax treatment for return on capital is historically the investment has produced local jobs which ultimately increases the total tax base.  Also historically people had not shifted their income to be predominately capital gains based.  Both these factors have resulted in providing tax benefits with very little value back to the government in terms of increased jobs.
> 
> Eliminating the break on capital gains and replacing it with a dramatically lower corporate income tax should be job 1.
Click to expand...


----------



## Trajan

Sactowndog said:


> Trajan said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> That was a very different generation that worked together to win WW2 and had a history of setting aside differences to focus on the common good.  This Congress is led by boomers who have a history of taking ideologically extreme positions and has been labeled as the me generation.
> 
> I think this is as much generational and a failure of the boomer generation as many other factors.
> 
> 
> 
> 
> you are making an argument in/of mitigation.
> 
> 
> and so what? Clinton was of what generation?
> 
> Click to expand...
> 
> 
> *Clinton was the first and the Congressional leaders of that era were not boomers. * My point is the problem in not Obama specifically but then generation as a whole that has never learned to set aside their ideological extreme positions for the good of the country as a whole.
Click to expand...


exactly- if I recall Clinton and the rep. congresses got things done, they fought, they cajoled, they compromised, of course it may not have seemed that way then, but  they managed things pretty well.


----------



## Sactowndog

Trajan said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Trajan said:
> 
> 
> 
> you are making an argument in/of mitigation.
> 
> 
> and so what? Clinton was of what generation?
> 
> 
> 
> 
> *Clinton was the first and the Congressional leaders of that era were not boomers. * My point is the problem in not Obama specifically but then generation as a whole that has never learned to set aside their ideological extreme positions for the good of the country as a whole.
> 
> Click to expand...
> 
> 
> exactly- if I recall Clinton and the rep. congresses got things done, they fought, they cajoled, they compromised, of course it may not have seemed that way then, but  they managed things pretty well.
Click to expand...



I don't disagree but this debate mirrors what is occurring on capital hill.  No one here as argued that entitlement reform doesn't have to be part of the solution and that spending especially in Medicare and Medicaid has to be reduced.  

Just like in Congress the sole impediment to us reaching agreement on a meaningful deficit reduction approach is your unwillingness to move on increasing the top income tax rate and worse the rate on capital gains.  

Just like on the Hill Republican insistence on maintaining these historically low tax rates in the face of crushing deficits is the main problem.  This is a center- far right debate not a center - left debate like Fox News likes to paint it.


----------



## Trajan

Sactowndog said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Trajan said:
> 
> 
> 
> Again this is completely wrong and misleading.  Yes the vast majority of people own stock but for a high percentage of those people the stock is held in 401K's and will never be subject to the capital gains tax.  All disbursements from a 401K are subject to Income Tax.
> 
> The Capital Gains tax rates are one of the poorest choices we make in the tax code, given that today most wealthy who would hold stock outside of 401K's diversify their portfolios globally.  Why should we provide an incentive rate to invest in China?  Those who are creating jobs in China should not be getting a break for funding the government in the United States.
> 
> 
> 
> 
> 
> I agree with that but what you said about 401k's being stock portfolios is "misleading'" you get co. stock by grant and discount purchase price in THAT co., it doesn't go into your 401K.
> 
> and that has what to do with revenue?
> 
> as far as poor choice, risk taken should be rewarded. they get  rate not based on income level,  becasue it is NOT income tax as we know it, taking a check form a job incurs zero risk, so thats probably as fair as it can get, most especially since you can only write off 3K in losses a year. And if they invest in China well so what? If you are against providing cap. gains rates to an investment made in china, which is taxed when it comes home, then you must be against free trade....are you?
> 
> 
> 
> 
> A stock grant or option is different than a company match in a 401K.  The claim was that virtually everyone holds stock of some sort and a capital gains tax cut benefits everyone.  This statement is simply not true as the general public holds stock within their 401K and disbursements from a 401k are treated as income not capital gains.  Therefore a capital gain tax cut does not help much of the middle class.
> 
> Second capital gains apply to much more than risky venture capital start ups.  Items like dividends are not particularly risky and still qualify for a capital gains treatment.  Second, the only reason to provide a beneficial tax treatment for return on capital is historically the investment has produced local jobs which ultimately increases the total tax base.  Also historically people had not shifted their income to be predominately capital gains based.  Both these factors have resulted in providing tax benefits with very little value back to the government in terms of increased jobs.
> 
> Eliminating the break on capital gains and replacing it with a dramatically lower corporate income tax should be job 1.
> 
> Click to expand...
> 
> 
> it appears you are stuck on  401K as a repository of stock for the 'middle class', the professional middle class gets grants and discounted purchases, these do NOT go INTO your 401K, you may select as an option IN your 401K to invest in the co. stock or other stocks for the % of your pay up to the limit that you have allocated for that purpose.
> 
> Further my finance guy advised me not to,  since I was getting grants and discounted  purchases in co.  it would behoove me NOT put all my eggs into one basket, I should diversify,  by NOT selecting co. stock as a basket 401K allocation, but a low, mid or high cap fund(s),  depending on where you are vis a vis your age vs. retirement plans etc.
> 
> 
> and-
> _
> For some time, 401(k) plans were also heavily used to acquire employer stock, mostly in public companies. About 19% of 401(k) assets were held in employer stock in 2001, but that number fell to about 10% by 2009 in the wake of the accounting scandals at Enron et. al. and, later, the stock market crash. Employees decided (wisely, we think) to be more careful about diversification in plans primarily designed for retirement. ESOPs and individual equity plans, meanwhile, remain good vehicles for asset building. _
> 
> A Comprehensive Overview of Employee Ownership
> 
> 
> 19%  doesn't sound huge to me. My wife and I both work/worked for fortune 500 co's that provide grants at focal time and purchase prgms. That stock given or purchased is put in your stock account portfolio- NOT a 401K, now if you had profit sharing to as I did you had a selection choice if you wanted to, to have it all held as co. stock, but that was profit sharing and 'free money', that was and deserves to be taxed at a non cap gains rate, but at a Roth style withdrawal rate to encourage thrift.
Click to expand...


----------



## oldfart

Wiseacre said:


> You're bashing Harvard economists?   HAHVAHD?   What's the world coming to.


I've read, attended seminars with, and worked with a number of Harvard economists.  Many of them are very good and some of them are pretty bad.  Harvard has some quirks that encourage that result in all fields.  They tend to pad the faculty by hiring big names after they have done their best work.  And they are notorious for high graduation rates regardless of achievement.  Harvard is great if you need a sheepskin effect, and you can get a world class graduate education there, but they are "too good" to be held to standards that we might apply to Princeton,  Chicago, Michigan, or Wisconsin.   



Wiseacre said:


> What about Estonia and the other Baltic States?   Did they not severely cut spending instead of significantly raising taxes?    Worked out well for them, Estonia is the only EU nation that is in surplus according to this:



If the best austerians can come up with is Estonia, it reveals just how bad the argument is.   
Estonia is not doing so well, and their "success" is mostly hype and wishful thinking.  But if you want to debate Estonia, make your case.  



Wiseacre said:


> A lot of the EU countries that are in dire economic straights [straits] didn't really cut spending, they raised taxes instead.   And their economies suffered.   Spending cuts are no picnic either, those Baltic countries went through a lot of pain for a few years.



Where's the evidence for this assertion?



Wiseacre said:


> I'm not saying you gotta go big all at once and balance the budget;  I'd be good with a gradual reduction to the point where spending increases do not exceed GDP growth.   And I'd be good with higher taxes if and when the economic experiences sustained growth and UE drops because we're creating a lot more jobs rather than because 350,000 people left the workforce.



I think you just contradicted yourself.  If the crucial point is that the only way to go is severe spending austerity, and that the failure of austerity to work is because there were tax increases and not enough drastic spending cuts, why would you embrace gradualism?

On a personal note, I think that the timing of tax increases is problematic.  Generally it's not a good idea to increase taxes in a depressed economy.  On the other side, if it's not done now, political considerations     make it impossible to do so later.  Reality can impinge on economic theory. 



Wiseacre said:


> But I also think we and those European countries have to restructure their social contract;  deals and promises were made that cannot be kept.   And nobody is willing to do that, so the can gets kicked and the problems get bigger and worser.   And the really bad part is, future generations will have to deal with the consequences of our prolificacy.



First, the "social contract" is quite different in Europe and the United States.  So are the causes of the economic distrubances.  Europe's problem is primarily one of trade balances created by the Euro experiment.  Changing the "social contract" there is a policy of "internal devaluaton" which has turned out to be largely ineffective and profoundly destabilizing.  If you want to debate Europe, the starting point is trade imbalances and capital flows, not national budgets.  

In the United States, the problem has been a lack of financial regulation and a financial sector on steroids and out of control.  The underlying debt problem is the result of an ideology which insists on tax cuts instead of reducing the debt or paying for things.  The "starve the beast" theory is great except for the fact that the "beast" is the American people.  I note in passing that having trashed America these "patriots" now are fomenting a succession movement.  

So let's have at it.  Just don't pretend that A & A is well regarded in the econmics literature.


----------



## Trajan

Sactowndog said:


> Trajan said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> *Clinton was the first and the Congressional leaders of that era were not boomers. * My point is the problem in not Obama specifically but then generation as a whole that has never learned to set aside their ideological extreme positions for the good of the country as a whole.
> 
> 
> 
> 
> exactly- if I recall Clinton and the rep. congresses got things done, they fought, they cajoled, they compromised, of course it may not have seemed that way then, but  they managed things pretty well.
> 
> Click to expand...
> 
> 
> 
> 
> 
> 
> I don't disagree but this debate mirrors what is occurring on capital hill.  No one here as argued that entitlement reform doesn't have to be part of the solution and that spending especially in Medicare and Medicaid has to be reduced.
> 
> Click to expand...
> 
> 
> -fine,  I await the Presidents proposal for/on such- medicare, ss, medicaid.
> 
> - why did he ask for a free hand on raising the debt. ceiling?
> 
> - he has also made noise as to raising the UE extensions again, so, what we are going to pay folks 5 years of UE benefits/ is that really what it was designed for? No, it wasn't. Its called Mission creep.
> 
> - we are now spending 1 TRILLION dollars on "poverty' prgms.....how long can that last?
> 
> 
> 
> 
> 
> Just like in Congress the sole impediment to us reaching agreement on a meaningful deficit reduction approach is your unwillingness to move on increasing the top income tax rate and worse the rate on capital gains.
> 
> Just like on the Hill Republican insistence on maintaining these historically low tax rates in the face of crushing deficits is the main problem.  This is a center- far right debate not a center - left debate like Fox News likes to paint it.
> 
> Click to expand...
> 
> 
> back to square 1....increasing the rates is fools gold, and I have explained why in this thread and in other threads here.
> 
> $ 83 Bn dollars will run us for a week and a half, its a smokescreen. tax reform is the key and getting a handle on the biggest drivers of debt now and future debt.
Click to expand...


----------



## Sactowndog

oldfart said:


> Wiseacre said:
> 
> 
> 
> You're bashing Harvard economists?   HAHVAHD?   What's the world coming to.
> 
> 
> 
> I've read, attended seminars with, and worked with a number of Harvard economist.  Many of them are very goodand some of them are pretty bad.  Harvard hs some quirks that encourage that result in all fields.  They tend to pad the faculty by hiring big names after they have done their best work.  And they are notorious for high graduation rates regardless of achievement.  Harvard is great if you need a sheepskin effect, and you can get a world class graduate education there, but they are "too good" to be held to standards that we ight apply to Princeton,  Chicago, Michigan, or Wisconsin.
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> What about Estonia and the other Baltic States?   Did they not severely cut spending instead of significantly raising taxes?    Worked out well for them, Estonia is the only EU nation that is in surplus according to this:
> 
> A lot of the EU countries that are in dire economic straights didn't really cut spending, they raised taxes instead.   And their economies suffered.   Spending cuts are no picnic either, those Baltic countries went through a lot of pain for a few years.   I'm not saying you gotta go big all at once and balance the budget;  I'd be good with a gradual reduction to the point where spending increases do not exceed GDP growth.   And I'd be good with higher taxes if and when the economic experiences sustained growth and UE drops because we're creating a lot more jobs rather than because 350,000 people left the workforce.
> 
> But I also think we and those European countries have to restructure their social contract;  deals and promises were made that cannot be kept.   And nobody is willing to do that, so the can gets kicked and the problems get bigger and worser.   And the really bad part is, future generations will have to deal with the consequences of our prolificacy.
> 
> Click to expand...
Click to expand...


Oldfart you appear to be an economist.  Please explain to me why no one hasn't adjusted the Economic models to account for the massive growth in global stock exchanges and the significant shift in portfolio theory.   

In 1980, when Capital gains rates were cut the Harvard endowment fund was 100% invested in US stocks and bonds.  Today that same fund has about 30% of it portfolio invested in US Stocks and Bonds.  So any reduction in capital gains will have much less local impact on jobs.

In addition the company I work for used the strategy of buying companies and off-shoring the employees to increase the cash flow.  A lower capital gains rate only lowers the hurdle rate on deals like these.  

In short, I think some true academic research could likely show reducing the capital gains rate today would have a significantly negative impact on the deficit and in fact might actually have a negative impact on jobs.


----------



## Sactowndog

Trajan said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Trajan said:
> 
> 
> 
> exactly- if I recall Clinton and the rep. congresses got things done, they fought, they cajoled, they compromised, of course it may not have seemed that way then, but  they managed things pretty well.
> 
> 
> 
> 
> 
> 
> 
> -fine,  I await the Presidents proposal for/on such- medicare, ss, medicaid.
> 
> - why did he ask for a free hand on raising the debt. ceiling?
> 
> - he has also made noise as to raising the UE extensions again, so, what we are going to pay folks 5 years of UE benefits/ is that really what it was designed for? No, it wasn't. Its called Mission creep.
> 
> - we are now spending 1 TRILLION dollars on "poverty' prgms.....how long can that last?
> 
> 
> 
> 
> 
> Just like in Congress the sole impediment to us reaching agreement on a meaningful deficit reduction approach is your unwillingness to move on increasing the top income tax rate and worse the rate on capital gains.
> 
> Just like on the Hill Republican insistence on maintaining these historically low tax rates in the face of crushing deficits is the main problem.  This is a center- far right debate not a center - left debate like Fox News likes to paint it.
> 
> Click to expand...
> 
> 
> back to square 1....increasing the rates is fools gold, and I have explained why in this thread and in other threads here.
> 
> $ 83 Bn dollars will run us for a week and a half, its a smokescreen. tax reform is the key and getting a handle on the biggest drivers of debt now and future debt.
> 
> Click to expand...
> 
> 
> No increasing the rates is important to show that everyone is pitching in and as th carrot for the democrats to agree to significant entitlement reform.  And I have yet to hear you say you would support these increases if you can get significant entitlement reform.
Click to expand...


----------



## Trajan

Sactowndog said:


> Trajan said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> -fine,  I await the Presidents proposal for/on such- medicare, ss, medicaid.
> 
> - why did he ask for a free hand on raising the debt. ceiling?
> 
> - he has also made noise as to raising the UE extensions again, so, what we are going to pay folks 5 years of UE benefits/ is that really what it was designed for? No, it wasn't. Its called Mission creep.
> 
> - we are now spending 1 TRILLION dollars on "poverty' prgms.....how long can that last?
> 
> 
> 
> 
> back to square 1....increasing the rates is fools gold, and I have explained why in this thread and in other threads here.
> 
> $ 83 Bn dollars will run us for a week and a half, its a smokescreen. tax reform is the key and getting a handle on the biggest drivers of debt now and future debt.
> 
> 
> 
> 
> No increasing the rates is important to show that everyone is pitching in and as th carrot for the democrats to agree to significant entitlement reform.  And I have yet to hear you say you would support these increases if you can get significant entitlement reform.
> 
> Click to expand...
> 
> 
> 
> 
> 
> No increasing the rates is important to show that everyone is pitching in and as th carrot for the democrats to agree to significant entitlement reform.
> 
> Click to expand...
> 
> 
> 
> Ah, I see, its a matter of 'fairness' despite the fact that the rates will yield approx. 83Bn dollars (in year one and almost certainly go down there after) means little, until the gop agrees to tax people because it presents the appearance of 'pitching in', the dems will not compromise?
> 
> So, the carrot isn't effective tax policy to collect more revenue, but, what will be almost a useless exercise in axe grinding.
> 
> I have to say I find that ridiculous.
> 
> 
> 
> you are representing a false premise, in any case- I do NOT sppt. rate hikes, I support tax_ reform_, with or without entitlement reform, one has little do with another.
Click to expand...


----------



## PaulS1950

Some of you are so busy blaming that you can't see the real problem. 
It has nothing to do with either party it has everything to do with both parties.
The federal government is giving money away and spending money they don't have!

If you had a debt that was 8 times your annual income and you paid only the interest on that loan would you continue spending more than you bring home?


----------



## oldfart

Sactowndog said:


> Oldfart you appear to be an economist.  Please explain to me why no one hasn't adjusted the Economic models to account for the massive growth in global stock exchanges and the significant shift in portfolio theory.



I think the double negative did not serve you well.  Stock exchanges are 99+%  secondary markets, so most macro models only incorporate them through wealth effects in the consumption function.  There's a lot of papers on rational market theory and asymmetrical market informaton, but I haven't seen much lately on portfolio theory per se.  But then I don't spend much tie keeping up on finance. 
QUOTE=Sactowndog;6463564]  In 1980, when Capital gains rates were cut the Harvard endowment fund was 100% invested in US stocks and bonds.  Today that same fund has about 30% of it portfolio invested in US Stocks and Bonds.  So any reduction in capital gains will have much less local impact on jobs.

In addition the company I work for used the strategy of buying companies and off-shoring the employees to increase the cash flow.  A lower capital gains rate only lowers the hurdle rate on deals like these.  

In short, I think some true academic research could likely show reducing the capital gains rate today would have a significantly negative impact on the deficit and in fact might actually have a negative impact on jobs.[/QUOTE]  
You raise some interesting issues.  My first thought would be that with corporations keeping trillions of ordinary earning offshore in tax havens and pushing the "territorial" tax system, capital gains rates would not be a big issue to them.


----------



## Sactowndog

oldfart said:


> Sactowndog said:
> 
> 
> 
> Oldfart you appear to be an economist.  Please explain to me why no one hasn't adjusted the Economic models to account for the massive growth in global stock exchanges and the significant shift in portfolio theory.
> 
> 
> 
> 
> I think the double negative did not serve you well.  Stock exchanges are 99+%  secondary markets, so most macro models only incorporate them through wealth effects in the consumption function.  There's a lot of papers on rational market theory and asymmetrical market informaton, but I haven't seen much lately on portfolio theory per se.  But then I don't spend much tie keeping up on finance.
> QUOTE=Sactowndog;6463564]  In 1980, when Capital gains rates were cut the Harvard endowment fund was 100% invested in US stocks and bonds.  Today that same fund has about 30% of it portfolio invested in US Stocks and Bonds.  So any reduction in capital gains will have much less local impact on jobs.
> 
> In addition the company I work for used the strategy of buying companies and off-shoring the employees to increase the cash flow.  A lower capital gains rate only lowers the hurdle rate on deals like these.
> 
> In short, I think some true academic research could likely show reducing the capital gains rate today would have a significantly negative impact on the deficit and in fact might actually have a negative impact on jobs.
Click to expand...

You raise some interesting issues.  My first thought would be that with corporations keeping trillions of ordinary earning offshore in tax havens and pushing the "territorial" tax system, capital gains rates would not be a big issue to them.[/QUOTE]

Sorry I am in bed sick typing this on my phone so Grammer checks are difficult.  From 1980 to 2005, 58 countries created stock exchanges and portfolio theory has changed radically so that investors invest globally versus locally.  These changes should have a dramatic impact on how effectively capital gains tax cuts spur economic growth.  I have half debated quiting my job and getting a doctoral degree to study this change.  

In terms of businesses the lower hurdle rate arises in terms of the seller not the buyer.  Most sellers have an after tax number in their head they want to receive for their business.  With a lower capital gains tax rate the sellers can reach that number more easily making them more likely to sell and the employees more likely to be off-shored.


----------



## Wiseacre

"  In terms of businesses the lower hurdle rate arises in terms of the seller not the buyer. Most sellers have an after tax number in their head they want to receive for their business. With a lower capital gains tax rate the sellers can reach that number more easily making them more likely to sell and the employees more likely to be off-shored.  "


This makes no sense, if the taxes are low enough for the seller to make the desired after tax profit, why would the buyer move the company offshore?   All other things being equal, the buyer isn't going to incur the considerable moving expenses without a damn good reason.


----------



## Wiseacre

"  In short, I think some true academic research could likely show reducing the capital gains rate today would have a significantly negative impact on the deficit and in fact might actually have a negative impact on jobs.  "


I highly doubt that;  I think that true academic research would show the exact opposite.   Because a lower CG rate incentivizes capital investment and enriches not only the rich but also encourages the less rich to put more money to work.   AND it also encourages offshore money and investments to come here instead of somewhere else.


----------



## The Rabbi

Wiseacre said:


> "  In short, I think some true academic research could likely show reducing the capital gains rate today would have a significantly negative impact on the deficit and in fact might actually have a negative impact on jobs.  "
> 
> 
> I highly doubt that;  I think that true academic research would show the exact opposite.   Because a lower CG rate incentivizes capital investment and enriches not only the rich but also encourages the less rich to put more money to work.   AND it also encourages offshore money and investments to come here instead of somewhere else.



It is historically the case that lowering hte CG rate produces more income to the govt, not less.  Even Obama understands this.


----------



## Foxfyre

Wiseacre said:


> "  In short, I think some true academic research could likely show reducing the capital gains rate today would have a significantly negative impact on the deficit and in fact might actually have a negative impact on jobs.  "
> 
> 
> I highly doubt that;  I think that true academic research would show the exact opposite.   Because a lower CG rate incentivizes capital investment and enriches not only the rich but also encourages the less rich to put more money to work.   AND it also encourages offshore money and investments to come here instead of somewhere else.



It isn't even a matter of doubt.  A lower CG makes investing a more attractive risk and the resulting increased economic activity has a positive ripple effect through the whole.


----------



## Arthur

Take the middle class and lower class tax hikes off the table and let the rich pay taxes at Clinton era rates.

Reduce expenditures starting with military waste, and proceeding to waste in all departments.


----------



## The Rabbi

Arthur said:


> Take the middle class and lower class tax hikes off the table and let the rich pay taxes at Clinton era rates.
> 
> Reduce expenditures starting with military waste, and proceeding to waste in all departments.



Why should high income earners be punished?  You realize that will not bring in more money, right?  It will result in reduced economic activity as high income earners figure out ways to shelter their income rather than pay tax on it.
Given whole departments in the gov't are basically waste, which ones would you like to see cut?


----------



## The Rabbi

Arthur said:


> Are you rich?



Quit deflecting and answer the question.


----------



## Arthur

I'll answer the questions I choose to answer.

"Senate Republicans would probably agree to higher tax rates on the wealthiest Americans if it meant getting a chance to overhaul costly government entitlement programs like Medicare and Social Security, a GOP senator predicted Sunday.

The comments by Bob Corker of Tennessee - a fiscal conservative who has been gaining stature in the Senate as a pragmatic deal broker - puts new pressure on House Speaker John Boehner and other Republican leaders to rethink their long-held assertion that even the very rich shouldn't see their rates go up next year. GOP leaders have argued that the revenue gained by hiking the top two tax rates would be trivial to the deficit, and that any tax hike hurts job creation."

Obama's plan would raise $1.6 trillion in revenue over 10 years, partly by letting decade-old tax cuts on the country's highest earners expire at the end of the year. He would continue those Bush-era tax cuts for everyone except individuals earning more than $200,000 and couples making above $250,000. The highest rates on top-paid Americans would rise from 33 percent and 35 percent to 36 percent and 39.6 percent.


Senator: GOP could accept tax hikes on very rich | National & World News | Seattle News, Weather, Sports, Breaking News | KOMO News


----------



## Arthur

In his "Wastebook 2012" report, Sen. Tom Coburn of Oklahoma pointed to 100 items including tax breaks to highly profitable sports leagues like the NFL, NASA funding to develop meals for a Mars mission that may not take place for decades and thousands of dollars for scientists to build a "robosquirrel" to see if rattlesnakes would try to eat it.

Coburn, a longtime crusader against waste, said better prioritizing and oversight could have saved taxpayers $18.9 billion on the programs included in the report, which was based largely on existing government studies, inspector generals' findings and media reports.

Coburn put much of the blame for the wasteful spending on Congress, which he described as deeply ineffectual and disliked by the America people.
Report on government waste cites 'robosquirrels,' tax breaks for NFL - CNN.com

Cutting out the robosquirrel is an example.


----------



## Arthur

Check this out:
2012 Pig Book Summary


----------



## Arthur

In his latest report on government waste, &#8220;Safety at Any Price,&#8221;  Sen. Tom Coburn, R-Okla., argued that Homeland Security funds allocated after 9/11 to shore up the U.S. anti-terrorism defense  are being misused.  He pointed to a five-day counter-terrorism summit that included a &#8220;zombie apocalypse&#8221; demonstration.

The sleepy town of Keene, N.H., for example, obtained a military grade BearCat armored vehicle early this year with DHS grant funds, citing the need to secure its annual pumpkin festival.  Price tag:  $285,933. The town has had only two murders in the past 15 years.
New Report: Zombies Partly to Blame for Government Waste - ABC News

We need to eliminate waste.  Period.  We must reduce funding and raise revenue.


----------



## Wiseacre

Plain and simple, our govt is wasting a lot of our money, and a lot of it is being lost to fraud.   I don't want to give the bastards one fucking dime more than they're getting now until they do a better job spending what they get now in effective and efficient programs.   AND I demand better legislation that makes it harder to cheat and swindle us and easier to prosecute those who do that.   

Neither party can deny culpability for the fiscal mess we've got now, finger pointing and demagoguery solves nothing.   Both sides are constantly maneuvering for political power rather than sewrving the best interests of the rest of us.   Damned if I know why we let them get away with it.


----------



## Arthur

Start by cutting the bloated defense budget:

"We continue to spend billions upon billions of dollars on a nuclear arsenal and Cold War-era weapons system designed to fight a phantom Soviet army. The Cold War is over and the Soviet Union long gone -- nonetheless, today we are spending above Cold War levels in real, inflation-corrected terms. It is time to say enough is enough; we need to rein in Pentagon spending after the last decade of unchecked increases, and spend our security dollars wisely on proven programs that can meet our national security goals. 

The Pentagon currently spends as much on the military as the next 12 to 15 countries combined, most of whom are allies. It dwarfs all other federal agencies in money lost to waste, fraud and abuse and is the only agency not subject to an annual audit. 

Two decades after the fall of the Soviet Union, the U.S. spends more in inflation-adjusted dollars than at the height of the Cold War. We need to adjust our approach to fit current threats by realigning our force structure. 

 The Project for Defense Alternatives, CATO Institute, Taxpayers for Common Sense, Center for American Progress, and Bowles-Simpson Commission have all called for deep cuts in defense spending ranging from $350 to $590 billion beyond the cuts already in place." 

Rep. Barbara Lee: Toss Wasteful Defense Weapons Programs Off the Cliff


----------



## Arthur

In fiscal year 2000, the Pentagon budget was $295 billion, the national debt was $5.62 trillion, and unemployment was 4 percent. In FY 2012, the Pentagon budget was $645 billion, and a deficit of $1.1 trillion contributed to a year-ending national debt of $16 trillion. Unemployment was 7.8 percent.

Just as important, the money has been spent wastefully, with $102 billion in waste identified in just FY 2011. And, according to the Pentagon itself, in the last decade, the Pentagon awarded $1.1 trillion in contracts to contractors who have engaged in fraud.

Ed Flaherty, 

Veterans for Peace Chapter 161

Military spending should be audited | TheGazette


----------



## Wiseacre

Arthur said:


> Start by cutting the bloated defense budget:
> 
> "We continue to spend billions upon billions of dollars on a nuclear arsenal and Cold War-era weapons system designed to fight a phantom Soviet army. The Cold War is over and the Soviet Union long gone -- nonetheless, today we are spending above Cold War levels in real, inflation-corrected terms. It is time to say enough is enough; we need to rein in Pentagon spending after the last decade of unchecked increases, and spend our security dollars wisely on proven programs that can meet our national security goals.
> 
> The Pentagon currently spends as much on the military as the next 12 to 15 countries combined, most of whom are allies. It dwarfs all other federal agencies in money lost to waste, fraud and abuse and is the only agency not subject to an annual audit.
> 
> Two decades after the fall of the Soviet Union, the U.S. spends more in inflation-adjusted dollars than at the height of the Cold War. We need to adjust our approach to fit current threats by realigning our force structure.
> 
> The Project for Defense Alternatives, CATO Institute, Taxpayers for Common Sense, Center for American Progress, and Bowles-Simpson Commission have all called for deep cuts in defense spending ranging from $350 to $590 billion beyond the cuts already in place."
> 
> Rep. Barbara Lee: Toss Wasteful Defense Weapons Programs Off the Cliff




Are you good with making identical cuts in Medicare/Medicaid/Obamacare?   And reforming Social Security to make it solvent?   And stop wasting money on Solyndras and high speed rail.   Not many on the left are okay with any of that.   When do we get to the part where the left gives up as much as they want from the right?


----------



## The Rabbi

Virtually every president has promised to "cut the fraud and waste."  Yet it doesnt happen.


----------



## KissMy

When did Republicans REDUCE THE SIZE OF GOVERNMENT????? Campaign Rhetoric is not reality!!! Nationalizing Banks for the rich does not reduce government. Neither does subsidizing Flood Insurance for the Rich. Alan Greenspan Called Out Republicans For Exploding Entitlement Spending. So has Comptroller General David Walker. Mitt Romney & Paul Ryan promised to add $716 billion more Medicare spending. They buy the votes of seniors who vote regularly with my tax money. They spent trillions on prescription drugs to seniors. Mitt Romney & Paul Ryan promised to increase military spending. They subsidize the top 1% who fund their campaign with my tax dollars. That shit must stop.


----------



## Trajan

Arthur said:


> Start by cutting the bloated defense budget:
> 
> "We continue to spend billions upon billions of dollars on a nuclear arsenal and Cold War-era weapons system designed to fight a phantom Soviet army. The Cold War is over and the Soviet Union long gone -- nonetheless, today we are spending above Cold War levels in real, inflation-corrected terms. It is time to say enough is enough; we need to rein in Pentagon spending after the last decade of unchecked increases, and spend our security dollars wisely on proven programs that can meet our national security goals.
> 
> The Pentagon currently spends as much on the military as the next 12 to 15 countries combined, most of whom are allies. It dwarfs all other federal agencies in money lost to waste, fraud and abuse and is the only agency not subject to an annual audit.
> 
> Two decades after the fall of the Soviet Union, the U.S. spends more in inflation-adjusted dollars than at the height of the Cold War. We need to adjust our approach to fit current threats by realigning our force structure.
> 
> The Project for Defense Alternatives, CATO Institute, Taxpayers for Common Sense, Center for American Progress, and Bowles-Simpson Commission have all called for deep cuts in defense spending ranging from $350 to $590 billion beyond the cuts already in place."
> 
> Rep. Barbara Lee: Toss Wasteful Defense Weapons Programs Off the Cliff



we have discussed this at length here-

http://www.usmessageboard.com/6427023-post25.html

plus ...

like it or not deterrence has always been a benchmark, MAD, etc.


Our deterrence in the wake of the ussr falling is now focused on the Chinese in that the age old concept of strategic freedom for commerce is still and always will be paramount.

The geography of the world being what it is, chokes points exit that help maintain that commercial freedom. There fore we need to maintain some semblance of advance bases securing these choke points.

I personally think we should scale back the manpower aspect as in amour and infantry as these are less technically challenging and intensive  to rehabilitate if we need them where in you cannot create aircraft carriers, superior aircraft in a year, as you could with infantry and  armored divisions.


as for spending cuts , we have and there are more cooked into the books-, the marines and army combined are being reduced by 47,000 troops. platforms as in heavy artillery and tanks are being pared back HOWEVER we have also canceled  the F-22 at 187 aircraft and have only 10 carrier air grps on hand and have canceled 3 of 5 of the next generation Carrier the Gerald Ford class, and we are only taking the 2, because there ( and always is for these alike platforms) were huge front loaded costs paid for in 03 and 06.


----------



## Foxfyre

Ya'll may be forgetting that the Democrats have not passed a national budget since 2009.  Romney did not want to increase medicare by 700+ billion.  He wanted to replace the raiding of the Medicare fund to pay for Obamacare.  The plan as you will recall, if Romney had won, was to repeal Obamacare.  

Having said that, while he did a good job with national security, President Bush did a terrible job with national defense and managed both wars poorly.  And it will forever be a footnote of controversy whether the invasion of Iraq was warranted and also whether nation building in Afghanistan was part of the original plan to go after the Taliban in retaliation for 9/11.  But both things happened and cannot now be undone.  So let's focus on how to move forward from this point.

But President Bush's last defense budget in 2008 was roughly $670 billion.

As of early December this year:



> WASHINGTON &#8212;  The Senate overwhelmingly approved a sweeping, $631 billion defense bill Tuesday that sends a clear signal to President Barack Obama to move quickly to get U.S. combat troops out of Afghanistan, tightens sanctions on Iran and limits the president's authority in handling terror suspects.
> Military budget flies through Senate - Worcester Telegram & Gazette - telegram.com



The vote was 98 to 0.


----------



## Sactowndog

Trajan said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Trajan said:
> 
> 
> 
> No increasing the rates is important to show that everyone is pitching in and as th carrot for the democrats to agree to significant entitlement reform.  And I have yet to hear you say you would support these increases if you can get significant entitlement reform.
> 
> 
> 
> 
> 
> 
> 
> No increasing the rates is important to show that everyone is pitching in and as th carrot for the democrats to agree to significant entitlement reform.
> 
> Click to expand...
> 
> 
> 
> Ah, I see, its a matter of 'fairness' despite the fact that the rates will yield approx. 83Bn dollars (in year one and almost certainly go down there after) means little, until the gop agrees to tax people because it presents the appearance of 'pitching in', the dems will not compromise?
> 
> So, the carrot isn't effective tax policy to collect more revenue, but, what will be almost a useless exercise in axe grinding.
> 
> I have to say I find that ridiculous.
> 
> 
> 
> you are representing a false premise, in any case- I do NOT sppt. rate hikes, I support tax_ reform_, with or without entitlement reform, one has little do with another.
> 
> Click to expand...
> 
> 
> It really doesn't matter a damn what you think.  The point is if you want to reform entitlements and get agreement that is the price you need to pay.  And if you right and it is a small amount your more obstinate than I believed and you define the problem with the Republican Party.  They put the interests of the one percent over the country.
Click to expand...


----------



## The Rabbi

Sactowndog said:


> Trajan said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> Ah, I see, its a matter of 'fairness' despite the fact that the rates will yield approx. 83Bn dollars (in year one and almost certainly go down there after) means little, until the gop agrees to tax people because it presents the appearance of 'pitching in', the dems will not compromise?
> 
> So, the carrot isn't effective tax policy to collect more revenue, but, what will be almost a useless exercise in axe grinding.
> 
> I have to say I find that ridiculous.
> 
> 
> 
> you are representing a false premise, in any case- I do NOT sppt. rate hikes, I support tax_ reform_, with or without entitlement reform, one has little do with another.
> 
> 
> 
> 
> It really doesn't matter a damn what you think.  The point is if you want to reform entitlements and get agreement that is the price you need to pay.  And if you right and it is a small amount your more obstinate than I believed and you define the problem with the Republican Party.  They put the interests of the one percent over the country.
> 
> Click to expand...
> 
> 
> That is wrong.  The problem with this country is not that the wealthy are payng too little.  They pay way too much, is one problem.  But the bigger problem is the spending.  Democrats have welched any number of times to address this but now we're being told "this time it's different."  It is not different.  It is the same shit, different day.  They will gladly vote for a tax increase but point fingers and swear solemnly that if the GOP cuts one dollar from the budget widows and orphans will be starving in the street.
> The Dems have no credibility when it comes to cutting spending.  They simply cannot.  So if they propose serious spending cuts--not 10 years down the road maybe--maybe the GOP should consider a tax increase.  But they won't.  The Dems will propose it to get the tax increase and then strip the cuts out of the bill at the last minute in their usual quasi-legal parliamentary maneuver.
Click to expand...


----------



## Sactowndog

Wiseacre said:


> "  In terms of businesses the lower hurdle rate arises in terms of the seller not the buyer. Most sellers have an after tax number in their head they want to receive for their business. With a lower capital gains tax rate the sellers can reach that number more easily making them more likely to sell and the employees more likely to be off-shored.  "
> 
> 
> This makes no sense, if the taxes are low enough for the seller to make the desired after tax profit, why would the buyer move the company offshore?   All other things being equal, the buyer isn't going to incur the considerable moving expenses without a damn good reason.



Because by moving the business off shore the company substantially improves their cash via labor arbitrage.  So "all other things aren't equal".  Generally the seller may not want to take this step so they sell to the buyer who then comes in and off shores the labor.


----------



## The Rabbi

Sactowndog said:


> Wiseacre said:
> 
> 
> 
> "  In terms of businesses the lower hurdle rate arises in terms of the seller not the buyer. Most sellers have an after tax number in their head they want to receive for their business. With a lower capital gains tax rate the sellers can reach that number more easily making them more likely to sell and the employees more likely to be off-shored.  "
> 
> 
> This makes no sense, if the taxes are low enough for the seller to make the desired after tax profit, why would the buyer move the company offshore?   All other things being equal, the buyer isn't going to incur the considerable moving expenses without a damn good reason.
> 
> 
> 
> 
> Because by moving the business off shore the company substantially improves their cash via labor arbitrage.  So "all other things aren't equal".  Generally the seller may not want to take this step so they sell to the buyer who then comes in and off shores the labor.
Click to expand...


If it made sense to off shore the labor, previous management would have done it already.  It isn't like off shoring is some new concept.  Of course changes in gov't policy, e.g. Obamacare, could change the equation to make it more profitable.


----------



## Sactowndog

Wiseacre said:


> "  In short, I think some true academic research could likely show reducing the capital gains rate today would have a significantly negative impact on the deficit and in fact might actually have a negative impact on jobs.  "
> 
> 
> I highly doubt that;  I think that true academic research would show the exact opposite.   Because a lower CG rate incentivizes capital investment and enriches not only the rich but also encourages the less rich to put more money to work.   AND it also encourages offshore money and investments to come here instead of somewhere else.



No what would incur off-shore money to come here would be lower corporate income taxes.  The investor will pay the capital gains rate where he lives not where he invests.  Capital extraction laws aside the investor maximizes his return by living where capital gains taxes are lowest and investing where corporate income taxes are lowest.  

Your thinking ignores dramatic changes in WW finance.


----------



## Sactowndog

The Rabbi said:


> Wiseacre said:
> 
> 
> 
> "  In short, I think some true academic research could likely show reducing the capital gains rate today would have a significantly negative impact on the deficit and in fact might actually have a negative impact on jobs.  "
> 
> 
> I highly doubt that;  I think that true academic research would show the exact opposite.   Because a lower CG rate incentivizes capital investment and enriches not only the rich but also encourages the less rich to put more money to work.   AND it also encourages offshore money and investments to come here instead of somewhere else.
> 
> 
> 
> 
> It is historically the case that lowering hte CG rate produces more income to the govt, not less.  Even Obama understands this.[/QUOTE
> 
> It was also historically the case that investors invested where they live.  Since that fundamental premise has changed so likely has the conclusion you state.
Click to expand...


----------



## Sactowndog

Foxfyre said:


> Wiseacre said:
> 
> 
> 
> "  In short, I think some true academic research could likely show reducing the capital gains rate today would have a significantly negative impact on the deficit and in fact might actually have a negative impact on jobs.  "
> 
> 
> I highly doubt that;  I think that true academic research would show the exact opposite.   Because a lower CG rate incentivizes capital investment and enriches not only the rich but also encourages the less rich to put more money to work.   AND it also encourages offshore money and investments to come here instead of somewhere else.
> 
> 
> 
> 
> It isn't even a matter of doubt.  A lower CG makes investing a more attractive risk and the resulting increased economic activity has a positive ripple effect through the whole.
Click to expand...


It is amazing to me how people take things on assumption even if the underlying factors have changed dramatically.  Again the past examples you point to we're all in a time when most portfolios were 100% invested in US stocks and bonds.  Since for the wealthy that has shrunk to 1/3 it stands to reason 2/3 of the effectiveness no longer exists.  It is quite possible that this 2/3 reduction makes reducing the capital gains taxes highly negative to the deficit.


----------



## The Rabbi

Sactowndog said:


> The Rabbi said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> "  In short, I think some true academic research could likely show reducing the capital gains rate today would have a significantly negative impact on the deficit and in fact might actually have a negative impact on jobs.  "
> 
> 
> I highly doubt that;  I think that true academic research would show the exact opposite.   Because a lower CG rate incentivizes capital investment and enriches not only the rich but also encourages the less rich to put more money to work.   AND it also encourages offshore money and investments to come here instead of somewhere else.
> 
> 
> 
> 
> It is historically the case that lowering hte CG rate produces more income to the govt, not less.  Even Obama understands this.[/QUOTE
> 
> It was also historically the case that investors invested where they live.  Since that fundamental premise has changed so likely has the conclusion you state.
> 
> Click to expand...
> 
> 
> Please show me that it has changed.  Please give a logical explanation why it would.
Click to expand...


----------



## The Rabbi

Sactowndog said:


> Foxfyre said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> "  In short, I think some true academic research could likely show reducing the capital gains rate today would have a significantly negative impact on the deficit and in fact might actually have a negative impact on jobs.  "
> 
> 
> I highly doubt that;  I think that true academic research would show the exact opposite.   Because a lower CG rate incentivizes capital investment and enriches not only the rich but also encourages the less rich to put more money to work.   AND it also encourages offshore money and investments to come here instead of somewhere else.
> 
> 
> 
> 
> It isn't even a matter of doubt.  A lower CG makes investing a more attractive risk and the resulting increased economic activity has a positive ripple effect through the whole.
> 
> Click to expand...
> 
> 
> It is amazing to me how people take things on assumption even if the underlying factors have changed dramatically.  Again the past examples you point to we're all in a time when most portfolios were 100% invested in US stocks and bonds.  Since for the wealthy that has shrunk to 1/3 it stands to reason 2/3 of the effectiveness no longer exists.  It is quite possible that this 2/3 reduction makes reducing the capital gains taxes highly negative to the deficit.
Click to expand...


And it is quite possible it is not.  In fact the burden of proof would be on you to show that this has changed.


----------



## Sactowndog

The Rabbi said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Trajan said:
> 
> 
> 
> It really doesn't matter a damn what you think.  The point is if you want to reform entitlements and get agreement that is the price you need to pay.  And if you right and it is a small amount your more obstinate than I believed and you define the problem with the Republican Party.  They put the interests of the one percent over the country.
> 
> 
> 
> 
> That is wrong.  The problem with this country is not that the wealthy are payng too little.  They pay way too much, is one problem.  But the bigger problem is the spending.  Democrats have welched any number of times to address this but now we're being told "this time it's different."  It is not different.  It is the same shit, different day.  They will gladly vote for a tax increase but point fingers and swear solemnly that if the GOP cuts one dollar from the budget widows and orphans will be starving in the street.
> The Dems have no credibility when it comes to cutting spending.  They simply cannot.  So if they propose serious spending cuts--not 10 years down the road maybe--maybe the GOP should consider a tax increase.  But they won't.  The Dems will propose it to get the tax increase and then strip the cuts out of the bill at the last minute in their usual quasi-legal parliamentary maneuver.
> 
> Click to expand...
> 
> 
> The Republicans control the house last I checked.  If the House leaders and President Obama agreed on a deal that raised taxes for the wealthy and reformed entitlements the Senate would pass it.  The problem with the deficit is clearly the Republican Party has so many of you have aptly proven.  I have not seen a single person argue against spending cuts and entitlement reforms.  All I see is you and those like you digging in your heels on tax rates for the wealthy.
> 
> You all illustrate the problem completely and that is why the country is blaming Republicans for not getting to a deal.
Click to expand...


----------



## The Rabbi

Sactowndog said:


> The Rabbi said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> That is wrong.  The problem with this country is not that the wealthy are payng too little.  They pay way too much, is one problem.  But the bigger problem is the spending.  Democrats have welched any number of times to address this but now we're being told "this time it's different."  It is not different.  It is the same shit, different day.  They will gladly vote for a tax increase but point fingers and swear solemnly that if the GOP cuts one dollar from the budget widows and orphans will be starving in the street.
> The Dems have no credibility when it comes to cutting spending.  They simply cannot.  So if they propose serious spending cuts--not 10 years down the road maybe--maybe the GOP should consider a tax increase.  But they won't.  The Dems will propose it to get the tax increase and then strip the cuts out of the bill at the last minute in their usual quasi-legal parliamentary maneuver.
> 
> 
> 
> 
> The Republicans control the house last I checked.  If the House leaders and President Obama agreed on a deal that raised taxes for the wealthy and reformed entitlements the Senate would pass it.  The problem with the deficit is clearly the Republican Party has so many of you have aptly proven.  I have not seen a single person argue against spending cuts and entitlement reforms.  All I see is you and those like you digging in your heels on tax rates for the wealthy.
> 
> You all illustrate the problem completely and that is why the country is blaming Republicans for not getting to a deal.
> 
> Click to expand...
> 
> 
> The country (whoever that is) is not blamng the GOP.  The liberal media and their lap dogs are blaming the GOP.
> The Dems have shown themselves to be totally untrustworthy.  They have not passed a budget in years.  They have not proposed any credible spending cuts.  Ten years down the road maybe is not credible.  All they want is higher tax rates on the rich, even though it would not solve the budget crisis one iota.  It is purely political.  That is all the Democratic Party is today: a political machine for getting and retaining power.  The GOP is serious about reining in the deficit.  It awaits honest Democrats to help.
Click to expand...


----------



## Sactowndog

The Rabbi said:


> Sactowndog said:
> 
> 
> 
> 
> 
> The Rabbi said:
> 
> 
> 
> It is historically the case that lowering hte CG rate produces more income to the govt, not less.  Even Obama understands this.[/QUOTE
> 
> It was also historically the case that investors invested where they live.  Since that fundamental premise has changed so likely has the conclusion you state.
> 
> 
> 
> 
> Please show me that it has changed.  Please give a logical explanation why it would.
> 
> Click to expand...
> 
> 
> I am not going to get the links for you but you can find them yourselves.  Look at the structure of the Harvard Endowment Fund which is the bellwether portfolio for sophisticated investors.  In 1980, 100% of the fund was invested in US stocks and bonds.  Today, that same portfolio has about 1/3 of its portfolio invested in US stocks and bonds.
Click to expand...


----------



## Sactowndog

The Rabbi said:


> Sactowndog said:
> 
> 
> 
> 
> 
> The Rabbi said:
> 
> 
> 
> The Republicans control the house last I checked.  If the House leaders and President Obama agreed on a deal that raised taxes for the wealthy and reformed entitlements the Senate would pass it.  The problem with the deficit is clearly the Republican Party has so many of you have aptly proven.  I have not seen a single person argue against spending cuts and entitlement reforms.  All I see is you and those like you digging in your heels on tax rates for the wealthy.
> 
> You all illustrate the problem completely and that is why the country is blaming Republicans for not getting to a deal.
> 
> 
> 
> 
> The country (whoever that is) is not blamng the GOP.  The liberal media and their lap dogs are blaming the GOP.
> The Dems have shown themselves to be totally untrustworthy.  They have not passed a budget in years.  They have not proposed any credible spending cuts.  Ten years down the road maybe is not credible.  All they want is higher tax rates on the rich, even though it would not solve the budget crisis one iota.  It is purely political.  That is all the Democratic Party is today: a political machine for getting and retaining power.  The GOP is serious about reining in the deficit.  It awaits honest Democrats to help.
> 
> Click to expand...
> 
> 
> Look at the polls, the majority of the population believes the Republicans are to blame.  As an independent voter just from the tone of this board I would draw the same conclusion.
> 
> Everyone here is ready to move to a solution which would impact the deficit but you and people ideologically aligned with you.  Despite what you claim it screams I don't care what the deficit is I just want to lower taxes on the wealthy.  This message is the same message being sent by the Republican Party.
Click to expand...


----------



## Wiseacre

Sactowndog said:


> Trajan said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> Ah, I see, its a matter of 'fairness' despite the fact that the rates will yield approx. 83Bn dollars (in year one and almost certainly go down there after) means little, until the gop agrees to tax people because it presents the appearance of 'pitching in', the dems will not compromise?
> 
> So, the carrot isn't effective tax policy to collect more revenue, but, what will be almost a useless exercise in axe grinding.
> 
> I have to say I find that ridiculous.
> 
> 
> 
> you are representing a false premise, in any case- I do NOT sppt. rate hikes, I support tax_ reform_, with or without entitlement reform, one has little do with another.
> 
> 
> 
> 
> It really doesn't matter a damn what you think.  The point is if you want to reform entitlements and get agreement that is the price you need to pay.  And if you right and it is a small amount your more obstinate than I believed and you define the problem with the Republican Party. * They put the interests of the one percent over the country*.
> 
> Click to expand...
> 
> 
> 
> This is just not true at all.   Although I am not and have never been a republican, I am a fiscal conservative that does not support a tax hike on the top 2% AT THIS TIME.   I don't give a flyin' fuck about the rich guys, but I don't see a way to grow the economy without letting these guys get richer.   Why?   Cuz these are the guys that put up the money for startups and business expansions.   And is you sock it to the rich, they will not put their money to the most productive uses for our economy.   There are too many other places or too many non taxable ways to invest where they can get a better ROI after taxes.
Click to expand...


----------



## Wiseacre

Sactowndog said:


> Wiseacre said:
> 
> 
> 
> "  In terms of businesses the lower hurdle rate arises in terms of the seller not the buyer. Most sellers have an after tax number in their head they want to receive for their business. With a lower capital gains tax rate the sellers can reach that number more easily making them more likely to sell and the employees more likely to be off-shored.  "
> 
> 
> This makes no sense, if the taxes are low enough for the seller to make the desired after tax profit, why would the buyer move the company offshore?   All other things being equal, the buyer isn't going to incur the considerable moving expenses without a damn good reason.
> 
> 
> 
> 
> Because by moving the business off shore the company substantially improves their cash via labor arbitrage.  So "all other things aren't equal".  Generally the seller may not want to take this step so they sell to the buyer who then comes in and off shores the labor.
Click to expand...


This makes absolutely no sense at all.   Arbitrage?   Are you talking labor disputes with a union?   Who's gonna buy a company in the middle of a labor dispute?   Who's gonna sell out if there's more profit to be made elsewhere?   I do not understand your position at all.


----------



## Wiseacre

Sactowndog said:


> Wiseacre said:
> 
> 
> 
> "  In short, I think some true academic research could likely show reducing the capital gains rate today would have a significantly negative impact on the deficit and in fact might actually have a negative impact on jobs.  "
> 
> 
> I highly doubt that;  I think that true academic research would show the exact opposite.   Because a lower CG rate incentivizes capital investment and enriches not only the rich but also encourages the less rich to put more money to work.   AND it also encourages offshore money and investments to come here instead of somewhere else.
> 
> 
> 
> 
> No what would incur off-shore money to come here would be lower corporate income taxes.  The investor will pay the capital gains rate where he lives not where he invests.  Capital extraction laws aside the investor maximizes his return by living where capital gains taxes are lowest and investing where corporate income taxes are lowest.
> 
> Your thinking ignores dramatic changes in WW finance.
Click to expand...



I think you are mistaken, most countries do not tax income earned outside of their borders.   In any case, US corporate taxes are THE highest in the world, and so will the cap gains tax rate be if all of Obama's taxes go into effect.   There is no way on God's green earth that a higher CG tax rate will in any way encourage anybody to invest here, and conversely a lower CG rate can NEVER have a negative economic effect.


----------



## Wiseacre

Sactowndog said:


> Foxfyre said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> "  In short, I think some true academic research could likely show reducing the capital gains rate today would have a significantly negative impact on the deficit and in fact might actually have a negative impact on jobs.  "
> 
> 
> I highly doubt that;  I think that true academic research would show the exact opposite.   Because a lower CG rate incentivizes capital investment and enriches not only the rich but also encourages the less rich to put more money to work.   AND it also encourages offshore money and investments to come here instead of somewhere else.
> 
> 
> 
> 
> It isn't even a matter of doubt.  A lower CG makes investing a more attractive risk and the resulting increased economic activity has a positive ripple effect through the whole.
> 
> Click to expand...
> 
> 
> It is amazing to me how people take things on assumption even if the underlying factors have changed dramatically.  Again the past examples you point to we're all in a time when most portfolios were 100% invested in US stocks and bonds.  Since for the wealthy that has shrunk to 1/3 it stands to reason 2/3 of the effectiveness no longer exists.  It is quite possible that this 2/3 reduction makes reducing the capital gains taxes highly negative to the deficit.
Click to expand...



First of all, how about you show me a link that talks about investor portfolios and the ratio of taxable cap gains to other asset classes.   Buit whatever the ratio is, I cannot fathom how anyone can claim that a lower CG tax rate could possibly be negative to the deficit, because a lower rate would result in a shift to investments in more US stocks and bonds.   It wouldn't just be the increase in taxable income for the investor but also the increase in economic growth and more jobs for the economy.


----------



## Wiseacre

Sactowndog said:


> The Rabbi said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> The country (whoever that is) is not blamng the GOP.  The liberal media and their lap dogs are blaming the GOP.
> The Dems have shown themselves to be totally untrustworthy.  They have not passed a budget in years.  They have not proposed any credible spending cuts.  Ten years down the road maybe is not credible.  All they want is higher tax rates on the rich, even though it would not solve the budget crisis one iota.  It is purely political.  That is all the Democratic Party is today: a political machine for getting and retaining power.  The GOP is serious about reining in the deficit.  It awaits honest Democrats to help.
> 
> 
> 
> 
> Look at the polls, the majority of the population believes the Republicans are to blame.  As an independent voter just from the tone of this board I would draw the same conclusion.
> 
> Everyone here is ready to move to a solution which would impact the deficit but you and people ideologically aligned with you.  Despite what you claim it screams I don't care what the deficit is I just want to lower taxes on the wealthy.  This message is the same message being sent by the Republican Party.
> 
> Click to expand...
> 
> 
> I don't think many people are calling for a tax cut for the wealthy or anybody else.   We just don't want to raise taxes at a time when the economy is weak.   We have a spending problem, not a revenue problem;   I haven't seen anything from the democrats on their proposed cuts;  show me the CBO report where their proposal was scored.
> 
> And BTW, the majority of the population believes the republicans are to blame cuz that's what they constantly hear from Obama and the MSM.   There's no effort from him or the democrats to come together;   there's no willingness from them to compromise.   What we've got here is political warfare, with nothing less than the future of the GOP at stake.
Click to expand...


----------



## The Rabbi

Sactowndog said:


> The Rabbi said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> Please show me that it has changed.  Please give a logical explanation why it would.
> 
> 
> 
> 
> I am not going to get the links for you but you can find them yourselves.  Look at the structure of the Harvard Endowment Fund which is the bellwether portfolio for sophisticated investors.  In 1980, 100% of the fund was invested in US stocks and bonds.  Today, that same portfolio has about 1/3 of its portfolio invested in US stocks and bonds.
> 
> Click to expand...
> 
> 
> Might be true but irrelevant.
Click to expand...


----------



## Sactowndog

Wiseacre said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> "  In short, I think some true academic research could likely show reducing the capital gains rate today would have a significantly negative impact on the deficit and in fact might actually have a negative impact on jobs.  "
> 
> 
> I highly doubt that;  I think that true academic research would show the exact opposite.   Because a lower CG rate incentivizes capital investment and enriches not only the rich but also encourages the less rich to put more money to work.   AND it also encourages offshore money and investments to come here instead of somewhere else.
> 
> 
> 
> 
> No what would incur off-shore money to come here would be lower corporate income taxes.  The investor will pay the capital gains rate where he lives not where he invests.  Capital extraction laws aside the investor maximizes his return by living where capital gains taxes are lowest and investing where corporate income taxes are lowest.
> 
> Your thinking ignores dramatic changes in WW finance.
> 
> Click to expand...
> 
> 
> 
> I think you are mistaken, most countries do not tax income earned outside of their borders.   In any case, US corporate taxes are THE highest in the world, and so will the cap gains tax rate be if all of Obama's taxes go into effect.   There is no way on God's green earth that a higher CG tax rate will in any way encourage anybody to invest here, and conversely a lower CG rate can NEVER have a negative economic effect.
Click to expand...


Who said anything about a higher CG tax encouraging a person to invest here???    Did you read the post??   

Most people pay capital gains where they live.  A company into which they invest pays income taxes in the country in which they are doing business.  To keep it simple if I live in a country with no capital gains tax and invest in a company who does business in a country with no corporate income tax; I will have effectively paid no taxes on my investment.  

So to minimize my taxes I want to live where capital gains taxes are low and invest where corporate income taxes are low.


----------



## Sactowndog

Wiseacre said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Foxfyre said:
> 
> 
> 
> It isn't even a matter of doubt.  A lower CG makes investing a more attractive risk and the resulting increased economic activity has a positive ripple effect through the whole.
> 
> 
> 
> 
> It is amazing to me how people take things on assumption even if the underlying factors have changed dramatically.  Again the past examples you point to we're all in a time when most portfolios were 100% invested in US stocks and bonds.  Since for the wealthy that has shrunk to 1/3 it stands to reason 2/3 of the effectiveness no longer exists.  It is quite possible that this 2/3 reduction makes reducing the capital gains taxes highly negative to the deficit.
> 
> Click to expand...
> 
> 
> 
> First of all, how about you show me a link that talks about investor portfolios and the ratio of taxable cap gains to other asset classes.   Buit whatever the ratio is, I cannot fathom how anyone can claim that a lower CG tax rate could possibly be negative to the deficit, because a lower rate would result in a shift to investments in more US stocks and bonds.   It wouldn't just be the increase in taxable income for the investor but also the increase in economic growth and more jobs for the economy.
Click to expand...


No it would not the capital gains tax is irrelevant to where you invest.  It will drive where I live but not where I invest.  Corporate income tax rates have a larger impact where I invest.  

You clearly have not internalized or thought through the impacts of a global economy.  All your statements assume people invest where they live and that assumption is just no longer true.


----------



## Sactowndog

The Rabbi said:


> Sactowndog said:
> 
> 
> 
> 
> 
> The Rabbi said:
> 
> 
> 
> I am not going to get the links for you but you can find them yourselves.  Look at the structure of the Harvard Endowment Fund which is the bellwether portfolio for sophisticated investors.  In 1980, 100% of the fund was invested in US stocks and bonds.  Today, that same portfolio has about 1/3 of its portfolio invested in US stocks and bonds.
> 
> 
> 
> 
> Might be true but irrelevant.
> 
> Click to expand...
> 
> 
> Not irrelevant when it is the model for how people should invest.  Let me ask you how much of your money is invested overseas?
Click to expand...


----------



## Sactowndog

Wiseacre said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> "  In terms of businesses the lower hurdle rate arises in terms of the seller not the buyer. Most sellers have an after tax number in their head they want to receive for their business. With a lower capital gains tax rate the sellers can reach that number more easily making them more likely to sell and the employees more likely to be off-shored.  "
> 
> 
> This makes no sense, if the taxes are low enough for the seller to make the desired after tax profit, why would the buyer move the company offshore?   All other things being equal, the buyer isn't going to incur the considerable moving expenses without a damn good reason.
> 
> 
> 
> 
> Because by moving the business off shore the company substantially improves their cash via labor arbitrage.  So "all other things aren't equal".  Generally the seller may not want to take this step so they sell to the buyer who then comes in and off shores the labor.
> 
> Click to expand...
> 
> 
> This makes absolutely no sense at all.   Arbitrage?   Are you talking labor disputes with a union?   Who's gonna buy a company in the middle of a labor dispute?   Who's gonna sell out if there's more profit to be made elsewhere?   I do not understand your position at all.
Click to expand...


Yes labor arbitrage and given your background in the military I would guess you have never had to lay-off your best loyal workers because their job is moving overseas.  I have and would rather never do that again.  

Most people are not Kevin O Leary and they can't emotionally lay-off long time employees just to lower costs and increase cash flow.  But a percentage of them are willing to sell their business to someone else who can and knows how to do it for a price.  That price like all things is a market and lowering the capital gains tax shifts the supply curve down and makes more deals likely to be done.


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## The Rabbi

Sactowndog said:


> The Rabbi said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> Might be true but irrelevant.
> 
> 
> 
> 
> Not irrelevant when it is the model for how people should invest.  Let me ask you how much of your money is invested overseas?
> 
> Click to expand...
> 
> 
> Doesn't matter.  If I have a capital gain on it, I will pay capital gains taxes.  If the taxes are high, I will leave the profit locked in rather than pay the tax and reduce my return.  That's the whole point.
Click to expand...


----------



## Foxfyre

The Rabbi said:


> Sactowndog said:
> 
> 
> 
> 
> 
> The Rabbi said:
> 
> 
> 
> Not irrelevant when it is the model for how people should invest.  Let me ask you how much of your money is invested overseas?
> 
> 
> 
> 
> Doesn't matter.  If I have a capital gain on it, I will pay capital gains taxes.  If the taxes are high, I will leave the profit locked in rather than pay the tax and reduce my return.  That's the whole point.
> 
> Click to expand...
> 
> 
> Exactly.  It doesn't matter where the investments are.  If you go through a U.S. broker, you will pay the tax on any applicable gains.  I don't have enough in investments to go to the expense of setting up overseas accounts.  But make the capital gains tax unattractive enough, and those who do have such wherewithal will simply not keep their money working at home but will find ways to shelter it.
> 
> There is a point that investment, whether in stocks and bonds or real estate or whatever, becomes too risky or unattractive.  The USA has one of the highest capital gains taxes in the world as it is now and is second, by a hair, only to Japan in Corporate taxes, plus has a brutal regulatory policy that becomes more oppressive and complicated all the time.
> 
> That is not the way to keep jobs at home and/or encourage economic growth.
Click to expand...


----------



## Foxfyre

I can't imagine what they are teaching re economics in public schools and in the universities these days.  It seems that far too many Americans seem to believe that government really can fix our problems and make everything right if it just has a bit more money and is give more power to do so.

Certainly in my lifetime, the education system was emphasizing that all true wealth is generated in the private sector and through the initiative of all those who work together by virtue of each person trying to get ahead.  And when the people are prospering through their own efforts, the whole country prospers.  And the government treasury is then filled.

Isn't that being taught anywhere any more?


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## The Rabbi

Foxfyre said:


> I can't imagine what they are teaching re economics in public schools and in the universities these days.  It seems that far too many Americans seem to believe that government really can fix our problems and make everything right if it just has a bit more money and is give more power to do so.
> 
> Certainly in my lifetime, the education system was emphasizing that all true wealth is generated in the private sector and through the initiative of all those who work together by virtue of each person trying to get ahead.  And when the people are prospering through their own efforts, the whole country prospers.  And the government treasury is then filled.
> 
> Isn't that being taught anywhere any more?



It clearly is not.  Thus people fall for the same crap over and over.  Gov't spending stimulates the economy and makes it grow through the Multiplier Effect.  Higher tax rates result in more revenue to the gov't with no loss of economic activity.  Special targeted tax breaks are effective incentives.  Setting minimum and maximum prices results in lower costs or higher wages.  On and on.
About 4 lectures in basic econ would be enough to dispel these myths.  Of course the education establishemnt would never allow that because knowledge equals freedom.  And the Left hates freedom.


----------



## Foxfyre

The Rabbi said:


> Foxfyre said:
> 
> 
> 
> I can't imagine what they are teaching re economics in public schools and in the universities these days.  It seems that far too many Americans seem to believe that government really can fix our problems and make everything right if it just has a bit more money and is give more power to do so.
> 
> Certainly in my lifetime, the education system was emphasizing that all true wealth is generated in the private sector and through the initiative of all those who work together by virtue of each person trying to get ahead.  And when the people are prospering through their own efforts, the whole country prospers.  And the government treasury is then filled.
> 
> Isn't that being taught anywhere any more?
> 
> 
> 
> 
> It clearly is not.  Thus people fall for the same crap over and over.  Gov't spending stimulates the economy and makes it grow through the Multiplier Effect.  Higher tax rates result in more revenue to the gov't with no loss of economic activity.  Special targeted tax breaks are effective incentives.  Setting minimum and maximum prices results in lower costs or higher wages.  On and on.
> About 4 lectures in basic econ would be enough to dispel these myths.  Of course the education establishemnt would never allow that because knowledge equals freedom.  And the Left hates freedom.
Click to expand...


And that is the scary part.  That our young are now intentionally being indoctrinated with a lie to enhance government power.  At least a few of the smarter and less gullible ones are able to see that government cannot spend a dime without first taking that dime out of the economy either now or later.  And that the sheer weight of cost of maintaining an ever growing and massive bureaucracy and the entitlements it gives to ensure that it is kept in place is slowly but surely bleeding the private sector dry.

If this trend is not reversed, we will become another socialist totalitarian nation without anybody ever having to fire a shot.   The danger is that they already have more than 50% of the people dependent on at least some government subsidy.  Even when people know the danger, it is really hard for them to risk losing some gpvernment benefit they are getting.


----------



## oldfart

Foxfyre said:


> I can't imagine what they are teaching re economics in public schools and in the universities these days.  It seems that far too many Americans seem to believe that government really can fix our problems and make everything right if it just has a bit more money and is give more power to do so.
> 
> Certainly in my lifetime, the education system was emphasizing that all true wealth is generated in the private sector and through the initiative of all those who work together by virtue of each person trying to get ahead.  And when the people are prospering through their own efforts, the whole country prospers.  And the government treasury is then filled.
> 
> Isn't that being taught anywhere any more?



Well, I taught economics in a couple of colleges many years ago when I still had hair, so I'll venture an answer.  The level of economic education at the high school and introductory college levels has always been horrendously bad, consisting of one part civics and nine parts cant which never passed the smell test.  Long-term unemployment is impossible in a capitalist society.  Really?  This sort of drivel doesn't stand up to anyone who can read a newspaper.  What good is economic theory that can't explain unemployment?  

Now "all true wealth  is generated in the private sector" is another piece of bullpucky which cannot pass the smell test.  Really?  I suppose the University of Michigan never educated anyone.  You drive an automobile over an illusionary Interstate  highway.  The Hoover dam does not exist.  Private enterprise pays for constructing aircraft carriers.  Come on, my eight year old grandson can see the error in that (the six year old still believes in the tooth fairy, however).  

Just because the United States is virtually the only nation on the face of the earth that does not publish a capital budget does not mean that one does not exist.  The next time you get all lathered up about the national debt consider this:  The per capita share of the public debt is estimated to be less than a third of the per capita share of the public capital stock. I'll gladly take my share of both.  

Of course I expect that all of the free enterprise types will want to take any public goods and sell them to Chinese investors so we can pay off the national debt and everyone can pay tolls every time they drive a car.  The Navy can also rent its airplanes; miss a payment and no more interventions!

If the federal government kept books according to the same rules used for SEC registrations, it would have a helluva retained earnings account.  But that doesn't fit the bash government narrative, so I guess it will never be taught in schools.  Instead we'll get more of the "monopolies act just like perfectly competitive firms" manure the Chamber of Commerce puts out.


----------



## Wiseacre

Question:  Could a rich American setup a business overseas in Hong Kong (no cap gains tax there) and put money into that foreign company.   That business invests in businesses around the world, but since it's not here does the rich American pay taxes on those earnings?   I'm having a hard time believing rich guys can't find ways to park their money in foreign places and avoid paying taxes on earnings from that.


----------



## Foxfyre

Wiseacre said:


> Question:  Could a rich American setup a business overseas in Hong Kong (no cap gains tax there) and put money into that foreign company.   That business invests in businesses around the world, but since it's not here does the rich American pay taxes on those earnings?   I'm having a hard time believing rich guys can't find ways to park their money in foreign places and avoid paying taxes on earnings from that.



I haven't looked at that part of the tax code for awhile, but I believe any U.S. citizen earning what would normally be taxable foreign income from any source is subject to U.S. taxes on that income.  But there is a substantial foreign tax credit involved that softens the blow.  For small business owners operating overseas, I believe they can exclude up to $70k of the earning for tax purposes.  And of course many can show exclusions, expenses, and credits sufficient to wipe out their tax liability.   Where they make out like bandits is being free from the expense of the more onerous U.S. regulations, much lower minimum wage, much less in payroll taxes etc.

G.M. continues to lose money here in the U.S. and makes most of its profit overseas which greatly reduces its U.S. tax liability or wipes it out entirely.  Mammoth General Electric--yes the same one whose CEO is Obama's jobs czar--hasn't paid U.S. taxes in two years.  They write off U.S. operations as a loss, make all their profits overseas where they get the tax breaks, and their green energy credits courtesy of the U.S. government eliminates their tax liability entirely.   And yes, they continue to ship far more jobs overseas while they are reducing work forces here in the states.

The last time I read up on it, we had something like $3 trillion in U.S. private industry assets parked overseas that could be brought home if they wouldn't be hit immediately with massive taxes.  And we have many more trillion in assets sidelined here at home because the business owners simply won't put it back into production in the uncertain economic climate of the last four years.   And the President's current desire to raise taxes on those earning $250k or more isn't helping with that at all.


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## saveliberty

GM is losing money in Europe and not Asia or the US.


----------



## Foxfyre

oldfart said:


> Foxfyre said:
> 
> 
> 
> I can't imagine what they are teaching re economics in public schools and in the universities these days.  It seems that far too many Americans seem to believe that government really can fix our problems and make everything right if it just has a bit more money and is give more power to do so.
> 
> Certainly in my lifetime, the education system was emphasizing that all true wealth is generated in the private sector and through the initiative of all those who work together by virtue of each person trying to get ahead.  And when the people are prospering through their own efforts, the whole country prospers.  And the government treasury is then filled.
> 
> Isn't that being taught anywhere any more?
> 
> 
> 
> 
> Well, I taught economics in a couple of colleges many years ago when I still had hair, so I'll venture an answer.  The level of economic education at the high school and introductory college levels has always been horrendously bad, consisting of one part civics and nine parts cant which never passed the smell test.  Long-term unemployment is impossible in a capitalist society.  Really?  This sort of drivel doesn't stand up to anyone who can read a newspaper.  What good is economic theory that can't explain unemployment?
> 
> Now "all true wealth  is generated in the private sector" is another piece of bullpucky which cannot pass the smell test.  Really?  I suppose the University of Michigan never educated anyone.  You drive an automobile over an illusionary Interstate  highway.  The Hoover dam does not exist.  Private enterprise pays for constructing aircraft carriers.  Come on, my eight year old grandson can see the error in that (the six year old still believes in the tooth fairy, however).
> 
> Just because the United States is virtually the only nation on the face of the earth that does not publish a capital budget does not mean that one does not exist.  The next time you get all lathered up about the national debt consider this:  The per capita share of the public debt is estimated to be less than a third of the per capita share of the public capital stock. I'll gladly take my share of both.
> 
> Of course I expect that all of the free enterprise types will want to take any public goods and sell them to Chinese investors so we can pay off the national debt and everyone can pay tolls every time they drive a car.  The Navy can also rent its airplanes; miss a payment and no more interventions!
> 
> If the federal government kept books according to the same rules used for SEC registrations, it would have a helluva retained earnings account.  But that doesn't fit the bash government narrative, so I guess it will never be taught in schools.  Instead we'll get more of the "monopolies act just like perfectly competitive firms" manure the Chamber of Commerce puts out.
Click to expand...


Again, the fact that you demonstrate that you don't know the difference between national defense, social contract, and 'creation of wealth by government', as well as the history of these, makes me hope that your students slept through those classes.


----------



## Foxfyre

saveliberty said:


> GM is losing money in Europe and not Asia or the US.



If you believe that, I have a nice assortment of bridges to show you.



> President Obama is proud of his bailout of General Motors.  Thats good, because, if he wins a second term, he is probably going to have to bail GM out again.  The company is once again losing market share, and it seems unable to develop products that are truly competitive in the U.S. market.
> 
> Right now, the federal government owns 500,000,000 shares of GM, or about 26% of the company.  It would need to get about $53.00/share for these to break even on the bailout, but the stock closed at only $20.21/share on Tuesday.  This left the government holding $10.1 billion worth of stock, and sitting on an unrealized loss of $16.4 billion.
> 
> Right now, the governments GM stock is worth about 39% less than it was on November 17, 2010, when the company went public at $33.00/share.  However, during the intervening time, the Dow Jones Industrial Average has risen by almost 20%, so GM shares have lost 49% of their value relative to the Dow.
> General Motors Is Headed For Bankruptcy -- Again - Forbes



It is true that GM has not been doing well in Europe this last year.
GM posts profit in spite of Europe woes - Aug. 2, 2012'

And it is true that most of GM's profits, such as they are, come from its Asian markets.


----------



## Foxfyre

Apologies to Wiseacre for veering off course with this thread, but the effects of government economic policy as reflected in the budget or lack thereof is pertinent to the discussion I hope.

It also speaks to whether we do want the Republicans to throw up their hands and give up and allow the Democrats and Obama to do whatever they want in hopes this will educate the people out there.  I just remind us that we've had four years of history of Obamanomics now and the results didn't much affect the election.  Why would more misery with a media blaming the Republicans for anything that goes wrong make any difference.  And how far do we fall over the cliff before the damage cannot be reversed?


----------



## The Rabbi

oldfart said:


> Foxfyre said:
> 
> 
> 
> I can't imagine what they are teaching re economics in public schools and in the universities these days.  It seems that far too many Americans seem to believe that government really can fix our problems and make everything right if it just has a bit more money and is give more power to do so.
> 
> Certainly in my lifetime, the education system was emphasizing that all true wealth is generated in the private sector and through the initiative of all those who work together by virtue of each person trying to get ahead.  And when the people are prospering through their own efforts, the whole country prospers.  And the government treasury is then filled.
> 
> Isn't that being taught anywhere any more?
> 
> 
> 
> 
> Well, I taught economics in a couple of colleges many years ago when I still had hair, so I'll venture an answer.  The level of economic education at the high school and introductory college levels has always been horrendously bad, consisting of one part civics and nine parts cant which never passed the smell test.  Long-term unemployment is impossible in a capitalist society.  Really?  This sort of drivel doesn't stand up to anyone who can read a newspaper.  What good is economic theory that can't explain unemployment?
> 
> Now "all true wealth  is generated in the private sector" is another piece of bullpucky which cannot pass the smell test.  Really?  I suppose the University of Michigan never educated anyone.  You drive an automobile over an illusionary Interstate  highway.  The Hoover dam does not exist.  Private enterprise pays for constructing aircraft carriers.  Come on, my eight year old grandson can see the error in that (the six year old still believes in the tooth fairy, however).
> 
> Just because the United States is virtually the only nation on the face of the earth that does not publish a capital budget does not mean that one does not exist.  The next time you get all lathered up about the national debt consider this:  The per capita share of the public debt is estimated to be less than a third of the per capita share of the public capital stock. I'll gladly take my share of both.
> 
> Of course I expect that all of the free enterprise types will want to take any public goods and sell them to Chinese investors so we can pay off the national debt and everyone can pay tolls every time they drive a car.  The Navy can also rent its airplanes; miss a payment and no more interventions!
> 
> If the federal government kept books according to the same rules used for SEC registrations, it would have a helluva retained earnings account.  But that doesn't fit the bash government narrative, so I guess it will never be taught in schools.  Instead we'll get more of the "monopolies act just like perfectly competitive firms" manure the Chamber of Commerce puts out.
Click to expand...


Is a university true wealth?  Is a road?  Was the bridge to nowhere an asset to the country or a liability?  I agree human capital is important and represents a resource.  But the mere presence of the university (which was built by tax dollars taken from the private economy of course) is not in itself "wealth."  It might be necessary to creating wealth.  But it is not wealth itself.


----------



## Foxfyre

The Rabbi said:


> oldfart said:
> 
> 
> 
> 
> 
> Foxfyre said:
> 
> 
> 
> I can't imagine what they are teaching re economics in public schools and in the universities these days.  It seems that far too many Americans seem to believe that government really can fix our problems and make everything right if it just has a bit more money and is give more power to do so.
> 
> Certainly in my lifetime, the education system was emphasizing that all true wealth is generated in the private sector and through the initiative of all those who work together by virtue of each person trying to get ahead.  And when the people are prospering through their own efforts, the whole country prospers.  And the government treasury is then filled.
> 
> Isn't that being taught anywhere any more?
> 
> 
> 
> 
> Well, I taught economics in a couple of colleges many years ago when I still had hair, so I'll venture an answer.  The level of economic education at the high school and introductory college levels has always been horrendously bad, consisting of one part civics and nine parts cant which never passed the smell test.  Long-term unemployment is impossible in a capitalist society.  Really?  This sort of drivel doesn't stand up to anyone who can read a newspaper.  What good is economic theory that can't explain unemployment?
> 
> Now "all true wealth  is generated in the private sector" is another piece of bullpucky which cannot pass the smell test.  Really?  I suppose the University of Michigan never educated anyone.  You drive an automobile over an illusionary Interstate  highway.  The Hoover dam does not exist.  Private enterprise pays for constructing aircraft carriers.  Come on, my eight year old grandson can see the error in that (the six year old still believes in the tooth fairy, however).
> 
> Just because the United States is virtually the only nation on the face of the earth that does not publish a capital budget does not mean that one does not exist.  The next time you get all lathered up about the national debt consider this:  The per capita share of the public debt is estimated to be less than a third of the per capita share of the public capital stock. I'll gladly take my share of both.
> 
> Of course I expect that all of the free enterprise types will want to take any public goods and sell them to Chinese investors so we can pay off the national debt and everyone can pay tolls every time they drive a car.  The Navy can also rent its airplanes; miss a payment and no more interventions!
> 
> If the federal government kept books according to the same rules used for SEC registrations, it would have a helluva retained earnings account.  But that doesn't fit the bash government narrative, so I guess it will never be taught in schools.  Instead we'll get more of the "monopolies act just like perfectly competitive firms" manure the Chamber of Commerce puts out.
> 
> Click to expand...
> 
> 
> Is a university true wealth?  Is a road?  Was the bridge to nowhere an asset to the country or a liability?  I agree human capital is important and represents a resource.  But the mere presence of the university (which was built by tax dollars taken from the private economy of course) is not in itself "wealth."  It might be necessary to creating wealth.  But it is not wealth itself.
Click to expand...


Correct.  Good government follows economic activity with infrastructure to support it.  You don't just decide to build a city.  Almost always, a new economic center always starts out with one homestead that usually is self sustaining  and benefits from no government services.  And as others establish homesteads, eventually there is sufficient market base to support sall businesses.  In time, as there are more and more of these, some kind of shared infrastructure makes sense and is profitable to all.  And then as there is more and more shared infrastructure, some kind of government is warranted to coordinate and manage all of that.   And thus an unincorporated community, then a village, then a town, then a city is born.   Eventually shared commerce between cities generates a practical motive  in connecting infrastructure between cities.

For many generations we had good government that was created by the people to support the economic activity they were generating.   Economic activity generated by government is a fairly new invention, and it is definitely showing far more downside than benefit.


----------



## Trajan

Sactowndog said:


> Trajan said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> Ah, I see, its a matter of 'fairness' despite the fact that the rates will yield approx. 83Bn dollars (in year one and almost certainly go down there after) means little, until the gop agrees to tax people because it presents the appearance of 'pitching in', the dems will not compromise?
> 
> So, the carrot isn't effective tax policy to collect more revenue, but, what will be almost a useless exercise in axe grinding.
> 
> I have to say I find that ridiculous.
> 
> 
> 
> you are representing a false premise, in any case- I do NOT sppt. rate hikes, I support tax_ reform_, with or without entitlement reform, one has little do with another.
> 
> 
> 
> 
> 
> 
> 
> It really doesn't matter a damn what you think.
> 
> Click to expand...
> 
> 
> it matters when you ask or infer I have not said anything on that topic. So I clarified, You asked, I answered.
> 
> 
> 
> 
> 
> The point is if you want to reform entitlements and get agreement that is the price you need to pay.
> 
> And if you right and it is a small amount your more obstinate than I believed and you define the problem with the Republican Party.  They put the interests of the one percent over the country.
> 
> Click to expand...
> 
> 
> 
> 
> 
> I will say it again-  if this price ( of what? that has yet to be offered or determined btw)  is a useless exercise is raising rates to raise an amount of $ ( 83 Bn in year 1)  that runs the gov. for a week and half, accusing me of being obstinate for not partaking in that useless change does not help you ro anyone, you _Appear_ to see this as an emotional issue, I see it as an economic one, just becasue its a 'small amount' doesn't changes anything, except put a point on the fact that is it next to usless.
> 
> You want that rate increase yet cannot seem to understand that that is not going to fix anything,  why raise rates when we can garner just as much if not more $$$ by Tax reform?
> 
> Click to expand...
Click to expand...


----------



## Trajan

Sactowndog said:


> The Rabbi said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> That is wrong.  The problem with this country is not that the wealthy are payng too little.  They pay way too much, is one problem.  But the bigger problem is the spending.  Democrats have welched any number of times to address this but now we're being told "this time it's different."  It is not different.  It is the same shit, different day.  They will gladly vote for a tax increase but point fingers and swear solemnly that if the GOP cuts one dollar from the budget widows and orphans will be starving in the street.
> The Dems have no credibility when it comes to cutting spending.  They simply cannot.  So if they propose serious spending cuts--not 10 years down the road maybe--maybe the GOP should consider a tax increase.  But they won't.  The Dems will propose it to get the tax increase and then strip the cuts out of the bill at the last minute in their usual quasi-legal parliamentary maneuver.
> 
> 
> 
> 
> The Republicans control the house last I checked.  If the House leaders and President Obama agreed on a deal that raised taxes for the wealthy and reformed entitlements the Senate would pass it.  The problem with the deficit is clearly the Republican Party has so many of you have aptly proven.  I have not seen a single person argue against spending cuts and entitlement reforms.  All I see is you and those like you digging in your heels on tax rates for the wealthy.
> 
> You all illustrate the problem completely and that is why the country is blaming Republicans for not getting to a deal.
> 
> Click to expand...
> 
> 
> The gop has agreed to raise revenue.
> 
> please show me the demcorats , say durbin, pelosi et al Obama too, that has put a solid offer on the table OR responded to an offer on the table that will for instance tie/index SS cost of living increases to inflation,  not the CPI-W as in wages, or raise the retirement age(s)?
> 
> and the debt ceiling?aside from double what he asked last year, 1.6 trillion,  the Obama 'offer' is for total control of the purse to raise the ceiling at his will, do you think that is an equitable offer?
Click to expand...


----------



## Sactowndog

Wiseacre said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> "  In terms of businesses the lower hurdle rate arises in terms of the seller not the buyer. Most sellers have an after tax number in their head they want to receive for their business. With a lower capital gains tax rate the sellers can reach that number more easily making them more likely to sell and the employees more likely to be off-shored.  "
> 
> 
> This makes no sense, if the taxes are low enough for the seller to make the desired after tax profit, why would the buyer move the company offshore?   All other things being equal, the buyer isn't going to incur the considerable moving expenses without a damn good reason.
> 
> 
> 
> 
> Because by moving the business off shore the company substantially improves their cash via labor arbitrage.  So "all other things aren't equal".  Generally the seller may not want to take this step so they sell to the buyer who then comes in and off shores the labor.
> 
> Click to expand...
> 
> 
> This makes absolutely no sense at all.   Arbitrage?   Are you talking labor disputes with a union?   Who's gonna buy a company in the middle of a labor dispute?   Who's gonna sell out if there's more profit to be made elsewhere?   I do not understand your position at all.
Click to expand...




Foxfyre said:


> The Rabbi said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> Doesn't matter.  If I have a capital gain on it, I will pay capital gains taxes.  If the taxes are high, I will leave the profit locked in rather than pay the tax and reduce my return.  That's the whole point.
> 
> 
> 
> 
> Exactly.  It doesn't matter where the investments are.  If you go through a U.S. broker, you will pay the tax on any applicable gains.  I don't have enough in investments to go to the expense of setting up overseas accounts.  But make the capital gains tax unattractive enough, and those who do have such wherewithal will simply not keep their money working at home but will find ways to shelter it.
> 
> There is a point that investment, whether in stocks and bonds or real estate or whatever, becomes too risky or unattractive.  The USA has one of the highest capital gains taxes in the world as it is now and is second, by a hair, only to Japan in Corporate taxes, plus has a brutal regulatory policy that becomes more oppressive and complicated all the time.
> 
> That is not the way to keep jobs at home and/or encourage economic growth.
> 
> Click to expand...
> 
> 
> Can any of you read?   I have said the taxes are paid where you live.  But that doesn't have anything to do where I am going to invest.  Yes at some point a higher capital gains tax limits taking more risk but the capital gains tax here has no affect on if I invest in the US or China.  In either case, I pay he same tax.   What would impact investing here or in China is the Corporate Income tax here versus the corporate income tax in China.
> 
> We can reduce the capital gains rate all day and investors will still send more money to China if their income tax rate is lower (assuming Taxes are a key decision factor which is debatable)
Click to expand...


----------



## Foxfyre

And still we have a President with no fears whatsoever other than what his legacy will be.  And he's feeling pretty darn cocky after pulling off his re-election and maintaining control of the Senate.  But his largest asset is the media.  You can find out the real deal if you dig deep enough, but they word it and present it in such a way that those who don't dig--and that would be most folks--believe what they hope they will believe.  Namely, that this whole debate is about the rich, protecting the rich, and helping the rich on the back of the poor.  There is absolutely nothing further from the truth than that, but that is what most people believe the debate is about.

Because spending cuts are not in the headlines or leading paragraphs, most people don't even think about that.  Or the national debt.  Or the deficit.  All they are concerned about is that the Republicans are to blame for everything and they are for the rich and nobody else.   And frankly, except for Fox News and conservative talk radio, we have little or nothing to context that perception.  And how many Obama supporters watch Fox News or listen to conservative talk radio?  Slim to none?

So the President doesn't care if we go over the fiscal cliff.  The Republicans will be blamed and the public will be so outraged they'll retaliate any way they can.  And he doesn't care of the Republicans cave.  Same scenario.  Whatever the results, it will be the Republicans fault.

Maybe Ann Coulter is right.  We are screwed and we might as well not fight it.


----------



## oldfart

Wiseacre said:


> Question:  Could a rich American setup a business overseas in Hong Kong (no cap gains tax there) and put money into that foreign company.   That business invests in businesses around the world, but since it's not here does the rich American pay taxes on those earnings?   I'm having a hard time believing rich guys can't find ways to park their money in foreign places and avoid paying taxes on earnings from that.



As a matter of tax law, an American can invest in offshore companies almost anywhere in the world except Cuba.  An American citizen is required to report all income worldwide on the United States income tax return.  In addition, there are two different reporting requirements for United States citizens with forein assets and bank accounts.  If the total of all such accounts exceeds $10,000 on any day of the year, a report must be filed with the Treasury.  The form filed wit the tax return has a higher threshold ($50,000) and some broader exceptions.  

Of curse there are legal ways around these requirements that taxpayers can avail themselves of.  And a lot of people decide to simply not report the assets and income they are required to.   So yes, there is a way to do it, lots of affluent people do it legally, and a lot of people, affluent or not, try to do it illegally.


----------



## Sactowndog

Trajan said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Trajan said:
> 
> 
> 
> it matters when you ask or infer I have not said anything on that topic. So I clarified, You asked, I answered.
> 
> 
> 
> 
> 
> 
> 
> I will say it again-  if this price ( of what? that has yet to be offered or determined btw)  is a useless exercise is raising rates to raise an amount of $ ( 83 Bn in year 1)  that runs the gov. for a week and half, accusing me of being obstinate for not partaking in that useless change does not help you ro anyone, you _Appear_ to see this as an emotional issue, I see it as an economic one, just becasue its a 'small amount' doesn't changes anything, except put a point on the fact that is it next to usless.
> 
> You want that rate increase yet cannot seem to understand that that is not going to fix anything,  why raise rates when we can garner just as much if not more $$$ by Tax reform?
> 
> 
> 
> 
> You are pretty much in the minority in believing raising revenue isn't part of the requirement to balance the budget.  Even rational Republicans acknowledge this point.  But why bother discussing it.  We can just agree if we all were in congress the country would go over the fiscal cliff.  You would blame me and I would blame you.  That is pretty much what will happen and we will see who the voters punish in the elections.  We have been down this road before in CA and the Republican Party is below the ability to be relevant.  The national party is on the same track but we shall see.
> 
> Click to expand...
Click to expand...


----------



## Sactowndog

Trajan said:


> Sactowndog said:
> 
> 
> 
> 
> 
> The Rabbi said:
> 
> 
> 
> The Republicans control the house last I checked.  If the House leaders and President Obama agreed on a deal that raised taxes for the wealthy and reformed entitlements the Senate would pass it.  The problem with the deficit is clearly the Republican Party has so many of you have aptly proven.  I have not seen a single person argue against spending cuts and entitlement reforms.  All I see is you and those like you digging in your heels on tax rates for the wealthy.
> 
> You all illustrate the problem completely and that is why the country is blaming Republicans for not getting to a deal.
> 
> 
> 
> 
> The gop has agreed to raise revenue.
> 
> please show me the demcorats , say durbin, pelosi et al Obama too, that has put a solid offer on the table OR responded to an offer on the table that will for instance tie/index SS cost of living increases to inflation,  not the CPI-W as in wages, or raise the retirement age(s)?
> 
> and the debt ceiling?aside from double what he asked last year, 1.6 trillion,  the Obama 'offer' is for total control of the purse to raise the ceiling at his will, do you think that is an equitable offer?
> 
> Click to expand...
> 
> 
> While I would agree some GOP politicians have agreed to raise revenue, I would not agree the House leadership has agreed and quite frankly they are all that matters.
> 
> Should Boehner agree and pass a bill that raises revenue and reforms entitlements I will be on this board singing his praises.  I don't see it happening but I can be hopeful.
Click to expand...


----------



## Foxfyre

Sactowndog said:


> Wiseacre said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> Because by moving the business off shore the company substantially improves their cash via labor arbitrage.  So "all other things aren't equal".  Generally the seller may not want to take this step so they sell to the buyer who then comes in and off shores the labor.
> 
> 
> 
> 
> This makes absolutely no sense at all.   Arbitrage?   Are you talking labor disputes with a union?   Who's gonna buy a company in the middle of a labor dispute?   Who's gonna sell out if there's more profit to be made elsewhere?   I do not understand your position at all.
> 
> Click to expand...
> 
> 
> 
> 
> Foxfyre said:
> 
> 
> 
> 
> 
> The Rabbi said:
> 
> 
> 
> Exactly.  It doesn't matter where the investments are.  If you go through a U.S. broker, you will pay the tax on any applicable gains.  I don't have enough in investments to go to the expense of setting up overseas accounts.  But make the capital gains tax unattractive enough, and those who do have such wherewithal will simply not keep their money working at home but will find ways to shelter it.
> 
> There is a point that investment, whether in stocks and bonds or real estate or whatever, becomes too risky or unattractive.  The USA has one of the highest capital gains taxes in the world as it is now and is second, by a hair, only to Japan in Corporate taxes, plus has a brutal regulatory policy that becomes more oppressive and complicated all the time.
> 
> That is not the way to keep jobs at home and/or encourage economic growth.
> 
> Click to expand...
> 
> 
> Can any of you read?   I have said the taxes are paid where you live.  But that doesn't have anything to do where I am going to invest.  Yes at some point a higher capital gains tax limits taking more risk but the capital gains tax here has no affect on if I invest in the US or China.  In either case, I pay he same tax.   What would impact investing here or in China is the Corporate Income tax here versus the corporate income tax in China.
> 
> We can reduce the capital gains rate all day and investors will still send more money to China if their income tax rate is lower (assuming Taxes are a key decision factor which is debatable)
> 
> Click to expand...
> 
> 
> It doesn't matter where you live.  If you are a U.S. citizen, your income must still be reported to the U.S. IRS.  In most cases, if the country where you are living requires taxes at least some of taxes paid there can be a credit to your U.S. taxes owed.  And, as I previously posted, those doing business in other countries can tack advantage of a foreign tax credit.
Click to expand...


----------



## Bern80

auditor0007 said:


> Old Rocks said:
> 
> 
> 
> Clinton raised taxes on the rich in '92. And the economy cratered, right? Not quite. Longest sustained economic boom in our naton's history.
> 
> Then Bushie Baby cut taxes, while engaged in two wars. And the economy did great, right? LOL. 16 trillion in homeowners value and 401Ks lost in two years, from 2007 to 2009.
> 
> So, what are we to believe? Recent history or rightwing ideology?
> 
> 
> 
> 
> There are so many problems when looking at this from any perspective.  First off, there is some merit to the idea that raising taxes will hurt more than help, at least in the short term.  The problem is that we have gotten ourselves into a severe pickle because we have used tax cuts over the past decade plus as a way to stimulate the economy.  Problem is, the tax cuts only helped in short stints, but in the long run, it did nothing.  We can't cut taxes any further to stimulate the economy because revenue has hit rock bottom due to the already low tax rates.
> 
> So what about spending?  Well, we could cut some here and there, but nobody can agree where to cut.  In the end, there is not going to be a simple solution, and this storm is going to be with us for some time; we're going to just have to ride it out.  My thoughts are that we end the payroll tax cut, and raise the tax rate on anyone making over $100,000 per year.  The rate increase does not need to be massive.  Secondly, raise the tax rate on capital gains to 20% with the idea of raising it higher once the economy gets rolling again, if necessary.  As for cuts, the easiest way to cut spending is to freeze it across the board, other than for SS and Medicare.  As for the long term, SS and Medicare spending must be reduced in comparison to what we are expecting to pay out.  We can't cut spending on those programs because we have more and more people retiring.  What we can do is raise the retirement age gradually for everyone until we hit a point where revenue and payouts are close to being balanced for the long term.
> 
> One thing nobody thinks about is that if we do what needs to be done to get spending under control, even if it is done slowly, the economy is going to pick up eventually.  There are two factors to look at that have nothing to do with politicians, taxation, or government spending.  The baby boomers are all retiring.  Even if they haven't retired yet, they are downsizing and not spending as much money anymore.  This wouldn't be such a problem but for the fact that their kids have delayed starting their own families.  While there are reasons for this, mostly economic, they are starting to hit the age where they have to begin getting married and having kids.  My thought is that within the next ten years, we are going to see a boom in child births which will lead to a lot of younger people needing to buy homes and bigger cars.  The spending cycle will kick into high gear once again, and then we will see things improve dramatically.
Click to expand...


Arguments like this unfortunately miss the big picture. When you argue for increasing government revenue one has to do so under the assumption that the government actually needs more money. That is the assumption that needs to be tackled first if we're ever going to get out of this. Instead of trying to figure out how to get the government more money, we should first be trying to figure out what does government actually need. Once we figure that out we can then devise a tax policy that ensures they get it.


----------



## Sallow

Bern80 said:


> auditor0007 said:
> 
> 
> 
> 
> 
> Old Rocks said:
> 
> 
> 
> Clinton raised taxes on the rich in '92. And the economy cratered, right? Not quite. Longest sustained economic boom in our naton's history.
> 
> Then Bushie Baby cut taxes, while engaged in two wars. And the economy did great, right? LOL. 16 trillion in homeowners value and 401Ks lost in two years, from 2007 to 2009.
> 
> So, what are we to believe? Recent history or rightwing ideology?
> 
> 
> 
> 
> There are so many problems when looking at this from any perspective.  First off, there is some merit to the idea that raising taxes will hurt more than help, at least in the short term.  The problem is that we have gotten ourselves into a severe pickle because we have used tax cuts over the past decade plus as a way to stimulate the economy.  Problem is, the tax cuts only helped in short stints, but in the long run, it did nothing.  We can't cut taxes any further to stimulate the economy because revenue has hit rock bottom due to the already low tax rates.
> 
> So what about spending?  Well, we could cut some here and there, but nobody can agree where to cut.  In the end, there is not going to be a simple solution, and this storm is going to be with us for some time; we're going to just have to ride it out.  My thoughts are that we end the payroll tax cut, and raise the tax rate on anyone making over $100,000 per year.  The rate increase does not need to be massive.  Secondly, raise the tax rate on capital gains to 20% with the idea of raising it higher once the economy gets rolling again, if necessary.  As for cuts, the easiest way to cut spending is to freeze it across the board, other than for SS and Medicare.  As for the long term, SS and Medicare spending must be reduced in comparison to what we are expecting to pay out.  We can't cut spending on those programs because we have more and more people retiring.  What we can do is raise the retirement age gradually for everyone until we hit a point where revenue and payouts are close to being balanced for the long term.
> 
> One thing nobody thinks about is that if we do what needs to be done to get spending under control, even if it is done slowly, the economy is going to pick up eventually.  There are two factors to look at that have nothing to do with politicians, taxation, or government spending.  The baby boomers are all retiring.  Even if they haven't retired yet, they are downsizing and not spending as much money anymore.  This wouldn't be such a problem but for the fact that their kids have delayed starting their own families.  While there are reasons for this, mostly economic, they are starting to hit the age where they have to begin getting married and having kids.  My thought is that within the next ten years, we are going to see a boom in child births which will lead to a lot of younger people needing to buy homes and bigger cars.  The spending cycle will kick into high gear once again, and then we will see things improve dramatically.
> 
> Click to expand...
> 
> 
> Arguments like this unfortunately miss the big picture. When you argue for increasing government revenue one has to do so under the assumption that the government actually needs more money. *That is the assumption that needs to be tackled first if we're ever going to get out of this. *Instead of trying to figure out how to get the government more money, we should first be trying to figure out what does government actually need. Once we figure that out we can then devise a tax policy that ensures they get it.
Click to expand...


The reality is, the government DOES need more money.

We have a rising population. It's pretty simple, more people equals the need for more services provided for by the government.

It's an astoundingly simple reality.

I find it interesting that the same folks that advocate against population control also advocate for starving the government of revenue.


----------



## Bern80

Sallow said:


> The reality is, the government DOES need more money.
> 
> We have a rising population. It's pretty simple, more people equals the need for more services provided for by the government.
> 
> It's an astoundingly simple reality.
> 
> I find it interesting that the same folks that advocate against population control also advocate for starving the government of revenue.



From a certain perspective that's true. The extremely obtuse and narrow minded perspective that is. Certainly you can argue that the government needs more money now that it has put itself hopelessly in debt. But that came about from the mentality of people like you. Listen to yourself for two seconds. You say it's so simple. More people means more government. A statement that rests on another assumption; that people simply can't survive without some level of government hand out. That's not simple. That's sad that you think that way. And it's that thinking that got us to this point and it's that thinking that is going to keep us there. Along with determining what governments obligations truly are and determining what that costs also needs to come a realization by many that the purpose of our government never was meant to be nor should to ensure some basic outcome for people. In that sense I am very much for population control.


----------



## The Rabbi

Sactowndog said:


> Trajan said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> The gop has agreed to raise revenue.
> 
> please show me the demcorats , say durbin, pelosi et al Obama too, that has put a solid offer on the table OR responded to an offer on the table that will for instance tie/index SS cost of living increases to inflation,  not the CPI-W as in wages, or raise the retirement age(s)?
> 
> and the debt ceiling?aside from double what he asked last year, 1.6 trillion,  the Obama 'offer' is for total control of the purse to raise the ceiling at his will, do you think that is an equitable offer?
> 
> 
> 
> 
> While I would agree some GOP politicians have agreed to raise revenue, I would not agree the House leadership has agreed and quite frankly they are all that matters.
> 
> Should Boehner agree and pass a bill that raises revenue and reforms entitlements I will be on this board singing his praises.  I don't see it happening but I can be hopeful.
> 
> Click to expand...
> 
> 
> Boehner has already agreed to this.  Obama has already rejected it since it does not raise rates, which is all he wants. He doesnt care about revenue.
Click to expand...


----------



## The Rabbi

Sactowndog said:


> Wiseacre said:
> 
> 
> 
> 
> 
> Sactowndog said:
> 
> 
> 
> Because by moving the business off shore the company substantially improves their cash via labor arbitrage.  So "all other things aren't equal".  Generally the seller may not want to take this step so they sell to the buyer who then comes in and off shores the labor.
> 
> 
> 
> 
> This makes absolutely no sense at all.   Arbitrage?   Are you talking labor disputes with a union?   Who's gonna buy a company in the middle of a labor dispute?   Who's gonna sell out if there's more profit to be made elsewhere?   I do not understand your position at all.
> 
> Click to expand...
> 
> 
> 
> 
> Foxfyre said:
> 
> 
> 
> 
> 
> The Rabbi said:
> 
> 
> 
> Exactly.  It doesn't matter where the investments are.  If you go through a U.S. broker, you will pay the tax on any applicable gains.  I don't have enough in investments to go to the expense of setting up overseas accounts.  But make the capital gains tax unattractive enough, and those who do have such wherewithal will simply not keep their money working at home but will find ways to shelter it.
> 
> There is a point that investment, whether in stocks and bonds or real estate or whatever, becomes too risky or unattractive.  The USA has one of the highest capital gains taxes in the world as it is now and is second, by a hair, only to Japan in Corporate taxes, plus has a brutal regulatory policy that becomes more oppressive and complicated all the time.
> 
> That is not the way to keep jobs at home and/or encourage economic growth.
> 
> Click to expand...
> 
> 
> Can any of you read?   I have said the taxes are paid where you live.  But that doesn't have anything to do where I am going to invest.  Yes at some point a higher capital gains tax limits taking more risk but the capital gains tax here has no affect on if I invest in the US or China.  In either case, I pay he same tax.   What would impact investing here or in China is the Corporate Income tax here versus the corporate income tax in China.
> 
> We can reduce the capital gains rate all day and investors will still send more money to China if their income tax rate is lower (assuming Taxes are a key decision factor which is debatable)
> 
> Click to expand...
> 
> 
> Geezus what nonsense.  Loweing cap gains taxes increases the amount of capital available to invest.  Many things will determine where that gets invested, chiefly after tax return.
Click to expand...


----------



## saveliberty

Sallow said:


> The reality is, the government DOES need more money.
> 
> We have a rising population. It's pretty simple, more people equals the need for more services provided for by the government.
> 
> It's an astoundingly simple reality.
> 
> I find it interesting that the same folks that advocate against population control also advocate for starving the government of revenue.



You'd have a point if all these people didn't pay taxes.  Its Tuesday, maybe Wednesday is a thinking day for you?


----------



## catatomic

Hello again,

    I looked up capital gains tax in the congressional budget office cbo.gov.  I looked up capital gains tax, then I went to Information on Changes in Federal Revenues and Tax Rates on Capital Gains.

    In the article I found the following sentence about capital gains tax hikes.

(Page 3)

"On net, we project that
federal revenues will increase in response to the higher tax rates, but that
reduced realizations will temper that increase."

So there you have it, once again as expected, raising taxes is potentially able to cut the deficit.


----------



## The Rabbi

catatomic said:


> Hello again,
> 
> I looked up capital gains tax in the congressional budget office cbo.gov.  I looked up capital gains tax, then I went to Information on Changes in Federal Revenues and Tax Rates on Capital Gains.
> 
> In the article I found the following sentence about capital gains tax hikes.
> 
> (Page 3)
> 
> "On net, we project that
> federal revenues will increase in response to the higher tax rates, but that
> reduced realizations will temper that increase."
> 
> So there you have it, once again as expected, raising taxes is potentially able to cut the deficit.



The CBO uses static scoring, assuming people do not change their behavior in response to changes in tax law.  IN the real world that doesnt happen.  Obama himself acknowledges that higher cap gains rates produce less revenue, not more.  Is Obama lying?


----------



## catatomic

I guess not.


----------



## oldfart

The Rabbi said:


> The CBO uses static scoring, assuming people do not change their behavior in response to changes in tax law.  IN the real world that doesnt happen.  Obama himself acknowledges that higher cap gains rates produce less revenue, not more.  Is Obama lying?



Where do you get the idea that the CBO uses static scoring?    http://cbo.gov/sites/default/files/cbofiles/ftpdocs/33xx/doc3373/1995doc18.pdf


CBO said:


> The budget estimates are also based on numerous assumptions about the
> microeconomic effects of the proposed policies-that is, how those policies might
> change individual behavior in response to new economic incentives. These
> behavioral and other technical estimating assumptions cover a wide variety of effects
> and reflect recent research and the best available estimating practices. For example,
> the estimate of a proposal to subsidize health insurance for early retirees would
> include the cost associated with the increase in the number of Social Security
> beneficiaries that would occur. Similarly, the estimate of a proposal to increase the
> excise tax on tobacco products would take into account the resulting decrease in
> consumption of cigarettes.


----------



## nodoginnafight

> Arguments like this unfortunately miss the big picture. When you argue for increasing government revenue one has to do so under the assumption that the government actually needs more money. That is the assumption that needs to be tackled first if we're ever going to get out of this. Instead of trying to figure out how to get the government more money, we should first be trying to figure out what does government actually need. Once we figure that out we can then devise a tax policy that ensures they get it.



This argument is simply an effort to re-write 50 to 60 years of legislation and redefine the contract between government and the governed in three weeks. It's an effort to re-vote on every issue that you already lost the argument on a long time ago.


----------



## The Rabbi

oldfart said:


> The Rabbi said:
> 
> 
> 
> The CBO uses static scoring, assuming people do not change their behavior in response to changes in tax law.  IN the real world that doesnt happen.  Obama himself acknowledges that higher cap gains rates produce less revenue, not more.  Is Obama lying?
> 
> 
> 
> 
> Where do you get the idea that the CBO uses static scoring?    http://cbo.gov/sites/default/files/cbofiles/ftpdocs/33xx/doc3373/1995doc18.pdf
> 
> 
> CBO said:
> 
> 
> 
> The budget estimates are also based on numerous assumptions about the
> microeconomic effects of the proposed policies-that is, how those policies might
> change individual behavior in response to new economic incentives. These
> behavioral and other technical estimating assumptions cover a wide variety of effects
> and reflect recent research and the best available estimating practices. For example,
> the estimate of a proposal to subsidize health insurance for early retirees would
> include the cost associated with the increase in the number of Social Security
> beneficiaries that would occur. Similarly, the estimate of a proposal to increase the
> excise tax on tobacco products would take into account the resulting decrease in
> consumption of cigarettes.
> 
> Click to expand...
Click to expand...


taxanalysts.com: Press Releases -- Martin A. Sullivan: Congressional Budget Office Offers Nod to

Dynamic Scoring: Not so Fast!

Bruce Bartlett on CBO Static/Dynamic Scoring on NRO Financial

etc.


----------



## oldfart

The Rabbi said:


> taxanalysts.com: Press Releases -- Martin A. Sullivan: Congressional Budget Office Offers Nod to
> 
> Dynamic Scoring: Not so Fast!
> 
> Bruce Bartlett on CBO Static/Dynamic Scoring on NRO Financial



OK, let me summarize the cited links.  First the CBO in a methodological paper from 1995 indicates it has been using dynamic analysis for several years prior to that date.  The first link you cited is from a non-profit which provides tax analysis.  Mr. Sullivan discusses CBO's efforts to incorporate dynamic analysis in its scoring with approval and then bemoans the fact that the Joint Committee on Taxation is not doing likewise.  

The second link is the famous Tax Policy Center which Republicans seem to alternately love and hate.  This 2006 article refers to the CBO and JCT use of dynamic scoring and notes that time considerations sometimes make it impractical to do dynamic scoring, but that static scoring in many cases is an acceptable approximation, with a 14% variance fo a ten year projection in the case studied.

Finally Mr. Bartlett in the third article published in 2002 refers to increasing efforts of CBO to increase the use of dynamic analysis.  

Note that all four sources refer to CBO as using dynamic analysis in budget scoring, and nowhere is there a claim that CBO uses static analysis when dynamic analysis is feasible.  

So again,  where is the evidence that CBO scoring is not usng dynamic analysis?


----------



## Sactowndog

Foxfyre said:


> Sactowndog said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> This makes absolutely no sense at all.   Arbitrage?   Are you talking labor disputes with a union?   Who's gonna buy a company in the middle of a labor dispute?   Who's gonna sell out if there's more profit to be made elsewhere?   I do not understand your position at all.
> 
> 
> 
> 
> 
> 
> Foxfyre said:
> 
> 
> 
> Can any of you read?   I have said the taxes are paid where you live.  But that doesn't have anything to do where I am going to invest.  Yes at some point a higher capital gains tax limits taking more risk but the capital gains tax here has no affect on if I invest in the US or China.  In either case, I pay he same tax.   What would impact investing here or in China is the Corporate Income tax here versus the corporate income tax in China.
> 
> We can reduce the capital gains rate all day and investors will still send more money to China if their income tax rate is lower (assuming Taxes are a key decision factor which is debatable)
> 
> Click to expand...
> 
> 
> It doesn't matter where you live.  If you are a U.S. citizen, your income must still be reported to the U.S. IRS.  In most cases, if the country where you are living requires taxes at least some of taxes paid there can be a credit to your U.S. taxes owed.  And, as I previously posted, those doing business in other countries can tack advantage of a foreign tax credit.
> 
> Click to expand...
> 
> 
> Yes this is true assuming you aren't willing to renounce your US citizenship and relocate to another country which some wealthy have done.  Again what would drive this behaviour would be capital gains tax and where they invest would be Corporate Income Tax.
> 
> So for an extreme example should the use raise capital gains taxes to France like numbers of 80-90% and simultaneously reduce Corporate income taxes to 0% the likely behaviour by the rich would be to move to an country with a lower capital gains tax (as many french are today) but increase investment in the US because earnings on those dollars could now be reinvested tax free.
Click to expand...


----------



## The Rabbi

oldfart said:


> The Rabbi said:
> 
> 
> 
> taxanalysts.com: Press Releases -- Martin A. Sullivan: Congressional Budget Office Offers Nod to
> 
> Dynamic Scoring: Not so Fast!
> 
> Bruce Bartlett on CBO Static/Dynamic Scoring on NRO Financial
> 
> 
> 
> 
> OK, let me summarize the cited links.  First the CBO in a methodological paper from 1995 indicates it has been using dynamic analysis for several years prior to that date.  The first link you cited is from a non-profit which provides tax analysis.  Mr. Sullivan discusses CBO's efforts to incorporate dynamic analysis in its scoring with approval and then bemoans the fact that the Joint Committee on Taxation is not doing likewise.
> 
> The second link is the famous Tax Policy Center which Republicans seem to alternately love and hate.  This 2006 article refers to the CBO and JCT use of dynamic scoring and notes that time considerations sometimes make it impractical to do dynamic scoring, but that static scoring in many cases is an acceptable approximation, with a 14% variance fo a ten year projection in the case studied.
> 
> Finally Mr. Bartlett in the third article published in 2002 refers to increasing efforts of CBO to increase the use of dynamic analysis.
> 
> Note that all four sources refer to CBO as using dynamic analysis in budget scoring, and nowhere is there a claim that CBO uses static analysis when dynamic analysis is feasible.
> 
> So again,  where is the evidence that CBO scoring is not usng dynamic analysis?
Click to expand...


Every article basically says CBO is moving to dynamic analysis but none of them says this is what they do.


----------



## Wiseacre

"  So for an extreme example should the use raise capital gains taxes to France like numbers of 80-90% and simultaneously reduce Corporate income taxes to 0% the likely behaviour by the rich would be to move to an country with a lower capital gains tax (as many french are today) *but increase investment in the US because earnings on those dollars could now be reinvested tax free.*   "


Not understanding, the earnings from investments in the US are subject to taxes here no matter who the investor is or where he/she lives.


----------



## Sactowndog

Bern80 said:


> auditor0007 said:
> 
> 
> 
> 
> 
> Old Rocks said:
> 
> 
> 
> Clinton raised taxes on the rich in '92. And the economy cratered, right? Not quite. Longest sustained economic boom in our naton's history.
> 
> Then Bushie Baby cut taxes, while engaged in two wars. And the economy did great, right? LOL. 16 trillion in homeowners value and 401Ks lost in two years, from 2007 to 2009.
> 
> So, what are we to believe? Recent history or rightwing ideology?
> 
> 
> 
> 
> There are so many problems when looking at this from any perspective.  First off, there is some merit to the idea that raising taxes will hurt more than help, at least in the short term.  The problem is that we have gotten ourselves into a severe pickle because we have used tax cuts over the past decade plus as a way to stimulate the economy.  Problem is, the tax cuts only helped in short stints, but in the long run, it did nothing.  We can't cut taxes any further to stimulate the economy because revenue has hit rock bottom due to the already low tax rates.
> 
> So what about spending?  Well, we could cut some here and there, but nobody can agree where to cut.  In the end, there is not going to be a simple solution, and this storm is going to be with us for some time; we're going to just have to ride it out.  My thoughts are that we end the payroll tax cut, and raise the tax rate on anyone making over $100,000 per year.  The rate increase does not need to be massive.  Secondly, raise the tax rate on capital gains to 20% with the idea of raising it higher once the economy gets rolling again, if necessary.  As for cuts, the easiest way to cut spending is to freeze it across the board, other than for SS and Medicare.  As for the long term, SS and Medicare spending must be reduced in comparison to what we are expecting to pay out.  We can't cut spending on those programs because we have more and more people retiring.  What we can do is raise the retirement age gradually for everyone until we hit a point where revenue and payouts are close to being balanced for the long term.
> 
> One thing nobody thinks about is that if we do what needs to be done to get spending under control, even if it is done slowly, the economy is going to pick up eventually.  There are two factors to look at that have nothing to do with politicians, taxation, or government spending.  The baby boomers are all retiring.  Even if they haven't retired yet, they are downsizing and not spending as much money anymore.  This wouldn't be such a problem but for the fact that their kids have delayed starting their own families.  While there are reasons for this, mostly economic, they are starting to hit the age where they have to begin getting married and having kids.  My thought is that within the next ten years, we are going to see a boom in child births which will lead to a lot of younger people needing to buy homes and bigger cars.  The spending cycle will kick into high gear once again, and then we will see things improve dramatically.
> 
> Click to expand...
> 
> 
> Arguments like this unfortunately miss the big picture. When you argue for increasing government revenue one has to do so under the assumption that the government actually needs more money. That is the assumption that needs to be tackled first if we're ever going to get out of this. Instead of trying to figure out how to get the government more money, we should first be trying to figure out what does government actually need. Once we figure that out we can then devise a tax policy that ensures they get it.
Click to expand...


Actually this is pretty much known.  Most people look at ~19-20% of GDP as the amount of spending needed.  A little less in good times and a little more in a recession.  Revenues are currently in the 16-17% of GDP and have to come up for us to get to a balanced budget and maintain the things we currently say we want to have.  

Now if we want to go back to an isolationist defense policy or eliminate Medicare or Social Security then we could drop the percentage but with those priorities you are in the 19-20% range.


----------



## Wiseacre

"   Revenues are currently in the 16-17% of GDP and have to come up for us to get to a balanced budget and maintain the things we currently say we want to have.   "


This is the crux of the issue over raising taxes.   Democrats want to raise the rate, and republicans believe doing that could adversely affect economic growth and the creation of new jobs.   Especially if the cap gains and dividend taxes are increased.  The GOP would rather would rather reform the tax code to disallow certain big income earners from reducing or eliminating their tax burden, but in so doing could also broaden the tax base.   Maybe you don't get as much new revenue that way, but revenue isn't the major driven of debt/deficits anyway.   

Far more central to the issue of deficit reduction is spending cuts,  which neither side wants to talk about.   I'm not talking about spending cuts in defense due to the end of the Iraq and Afdghan wars, those are gonna happen anyway.   T want to see real entitlement reform that will make those programs sustainable well into the future;  I know a lot of people in their 30s who don't believe the system as it is today will exist when their turn comes up.   I'm okay with defense taking their fair share of the hit, I think they're already doing that to some extent.


----------



## Sactowndog

Wiseacre said:


> "  So for an extreme example should the use raise capital gains taxes to France like numbers of 80-90% and simultaneously reduce Corporate income taxes to 0% the likely behaviour by the rich would be to move to an country with a lower capital gains tax (as many french are today) *but increase investment in the US because earnings on those dollars could now be reinvested tax free.*   "
> 
> 
> Not understanding, the earnings from investments in the US are subject to taxes here no matter who the investor is or where he/she lives.



So I am assuming the inverse of US laws and perhaps an accountant can chime in here....

If I move to say the Cayman Islands and give up my US citizenship for Cayman Citizenship..... the Cayman Island capital gains taxes would apply (assume they are 15%).  So I would save on my capital gains taxes.  I am assuming, perhaps incorrectly that any capital gains on the stock will pay local country capital gains taxes and not US capital gains taxes.

Meanwhile the US has lowered Corporate Income taxes to zero..   Any earnings by the company which are reinvested into the company grow tax free.  So if I invest a dollar into the company and it generates .06 in income those retained earning can be reinvested into the business with no tax.  That increases earnings after taxes and interest and therefore the value of my stock.  In essence company's act like giant 401K's.

Now assume I raise capital gains taxes and lower corporate income taxes by the same amount.  What are the effects......

US investors investing in US investments are a wash.  The increase in capital gains taxes are balanced with the decrease in corporate income taxes.  The double taxation as Republicans like to point out essentially cancels each other out.

US investors investing in China are punished.  They pay more in capital gains taxes but corporate income taxes in China remain the same so their net tax load increases.  If the net tax load increases per Republican dogma the incentive to invest in China is decreased.

Japanese investors investing in the US are rewarded.  The local capital gains tax in Japan stays the same while the corporate income tax is reduced so the net tax load is decreased.  If the net tax load decreases per Republican dogma the incentive to invest in he US is increased.  

So by raising capital gains and lowering the Corporate income tax I in effect create more investment in the US which equates to more jobs.  Get it now??


----------



## Sactowndog

Wiseacre said:


> "   Revenues are currently in the 16-17% of GDP and have to come up for us to get to a balanced budget and maintain the things we currently say we want to have.   "
> 
> 
> This is the crux of the issue over raising taxes.   Democrats want to raise the rate, and republicans believe doing that could adversely affect economic growth and the creation of new jobs.   Especially if the cap gains and dividend taxes are increased.  The GOP would rather would rather reform the tax code to disallow certain big income earners from reducing or eliminating their tax burden, but in so doing could also broaden the tax base.   Maybe you don't get as much new revenue that way, but revenue isn't the major driven of debt/deficits anyway.
> 
> Far more central to the issue of deficit reduction is spending cuts,  which neither side wants to talk about.   I'm not talking about spending cuts in defense due to the end of the Iraq and Afdghan wars, those are gonna happen anyway.   T want to see real entitlement reform that will make those programs sustainable well into the future;  I know a lot of people in their 30s who don't believe the system as it is today will exist when their turn comes up.   I'm okay with defense taking their fair share of the hit, I think they're already doing that to some extent.



I don't disagree.  If I were king, I would change the tax structure and make capital gains taxes higher and replace the corporate income tax with a capital exportation tax.  

But the fact is I am not and we need to raise revenue.  Obama won the election over Bush and this questions was central to the election.  Get over it.....

Raise taxes on the wealthy and reform entitltements as you ask.  This isn't really that hard.


----------



## oldfart

The Rabbi said:


> Every article basically says CBO is moving to dynamic analysis but none of them says this is what they do.
> I am sorry your reading skills are poor.



You may want to re-read your own links.  Every one gives examples of CBO using dynamic analysis.  Did you post them without reading them?  Anyway enough of this.  Everyone can follow the four links and draw their own conclusions.


----------



## Wiseacre

Sactowndog said:


> Wiseacre said:
> 
> 
> 
> "  So for an extreme example should the use raise capital gains taxes to France like numbers of 80-90% and simultaneously reduce Corporate income taxes to 0% the likely behaviour by the rich would be to move to an country with a lower capital gains tax (as many french are today) *but increase investment in the US because earnings on those dollars could now be reinvested tax free.*   "
> 
> 
> Not understanding, the earnings from investments in the US are subject to taxes here no matter who the investor is or where he/she lives.
> 
> 
> 
> 
> So I am assuming the inverse of US laws and perhaps an accountant can chime in here....
> 
> If I move to say the Cayman Islands and give up my US citizenship for Cayman Citizenship..... the Cayman Island capital gains taxes would apply (assume they are 15%).  So I would save on my capital gains taxes.  I am assuming, perhaps incorrectly that any capital gains on the stock will pay local country capital gains taxes and not US capital gains taxes.
> 
> Meanwhile the US has lowered Corporate Income taxes to zero..   Any earnings by the company which are reinvested into the company grow tax free.  So if I invest a dollar into the company and it generates .06 in income those retained earning can be reinvested into the business with no tax.  That increases earnings after taxes and interest and therefore the value of my stock.  In essence company's act like giant 401K's.
> 
> Now assume I raise capital gains taxes and lower corporate income taxes by the same amount.  What are the effects......
> 
> US investors investing in US investments are a wash.  The increase in capital gains taxes are balanced with the decrease in corporate income taxes.  The double taxation as Republicans like to point out essentially cancels each other out.
> 
> US investors investing in China are punished.  They pay more in capital gains taxes but corporate income taxes in China remain the same so their net tax load increases.  If the net tax load increases per Republican dogma the incentive to invest in China is decreased.
> 
> Japanese investors investing in the US are rewarded.  The local capital gains tax in Japan stays the same while the corporate income tax is reduced so the net tax load is decreased.  If the net tax load decreases per Republican dogma the incentive to invest in he US is increased.
> 
> So by raising capital gains and lowering the Corporate income tax I in effect create more investment in the US which equates to more jobs.  Get it now??
Click to expand...



Well, sorta, I got lost in your scenario fairly quickly.   I ain't the sharpest knife in the drawer, and this stuff rapidly gets complicated.   I'm not an accountant or a tax expert, or even an economist, just trying to understand this whole deal.   That said, my understanding is that if you are a non-resident alien then you don't pay taxes here on capital gains, you do that in your own country whatever the CG rate is there.   That means you had to renounce your US citizenship, which is happening these days, over a thousand a year.   I think you gotta be out of the country for at least 3 years though.   Anyway, if rich folks are renouncing their US citizneship for tax purposes because the income taxes or CG taxes are too high, that's a negative for the economy and jobs.   Cuz those people ain't here spending money and investing as US citizens any more. 

If you are an American, you pay our taxes no matter where you live or where you earn your income.   Same deal if you are a resident alien living here, you are subject to the same tax rates as the rest of us.   Sorry 'bout that.   Which is one reason why higher CG and income rates discourage resident aliens from investing and staying here.   I do not believe this is trivial either, over the past 30 years or so foreign investors have provided a significant chunk of capital into our economy.

Same deal with American investors, wherever they live.   A higher cap gains rate disincentivizes them to put their money to good use on our economy.   Maybe they don't invest it overseas, but we lose if that money if it's not invested here.   Maybe they put it in tax free investments, or find creative ways to lower their tax burden.   Long story short, there's no way a higher CG tax rate can be beneficial to an economy unless you're fighting inflation or the economy is overheating.

The corp tax rate thing kinda muddied the waters a little for me.   Don't quite see the link with cap gains, one is for investors and the other is for employees.   A lower corp tax rate definitely makes a country more attractive for entrepeneurs to startup a business or expand one ormaybe even relocate one.   There's a lotta other factors to that though, but the fact is that many countries and US states are trying to do exactly that, attractmore business and hence more jobs and hence more revenue.


----------



## Wiseacre

Sactowndog said:


> Wiseacre said:
> 
> 
> 
> "   Revenues are currently in the 16-17% of GDP and have to come up for us to get to a balanced budget and maintain the things we currently say we want to have.   "
> 
> 
> This is the crux of the issue over raising taxes.   Democrats want to raise the rate, and republicans believe doing that could adversely affect economic growth and the creation of new jobs.   Especially if the cap gains and dividend taxes are increased.  The GOP would rather would rather reform the tax code to disallow certain big income earners from reducing or eliminating their tax burden, but in so doing could also broaden the tax base.   Maybe you don't get as much new revenue that way, but revenue isn't the major driven of debt/deficits anyway.
> 
> Far more central to the issue of deficit reduction is spending cuts,  which neither side wants to talk about.   I'm not talking about spending cuts in defense due to the end of the Iraq and Afdghan wars, those are gonna happen anyway.   T want to see real entitlement reform that will make those programs sustainable well into the future;  I know a lot of people in their 30s who don't believe the system as it is today will exist when their turn comes up.   I'm okay with defense taking their fair share of the hit, I think they're already doing that to some extent.
> 
> 
> 
> 
> I don't disagree.  If I were king, I would change the tax structure and make capital gains taxes higher and replace the corporate income tax with a capital exportation tax.
> 
> But the fact is I am not and we need to raise revenue.  Obama won the election over Bush and this questions was central to the election.  Get over it.....
> 
> Raise taxes on the wealthy and reform entitltements as you ask.  This isn't really that hard.
Click to expand...



LOL, did I advocate raising taxes on the wealthy?   Must've mistyped something somewhere.   Look, I'd do it if it meant getting entitlement reforms done.   I'd rather leave the rates the way they are and reform the tax code first so some rich guys don't get out of paying what everyone else pays in their income bracket.   Frankly, I'd rather see a flat tax with a slight progressive slant to it with no deductions at all.   Our tax code is too damn difficult to follow IMHO.


----------



## catatomic

I don't know Rabbi...

After I looked at the fourth paragraph of "Dynamic Scoring: Not so fast" it says,

The JCT has done similar studies of other tax options, as well. The Congressional Budget Office (CBO) also routinely conducts dynamic analyses.

Also in the first link it says congress has made increasing something or other for dynamic scoring, which to me clearly reads as "They have been getting better and better at it" and not, "They aren't getting any and put more and more pressure from it."

And I looked up Bruce Barlett's history.  That  article was from Aug 19, 2002.  Bruce Bartlett has completely changed around by then.

I am sure that they have a good level of dynamic scoring and not just static scoring.


----------



## Foxfyre

catatomic said:


> I don't know Rabbi...
> 
> After I looked at the fourth paragraph of "Dynamic Scoring: Not so fast" it says,
> 
> The JCT has done similar studies of other tax options, as well. The Congressional Budget Office (CBO) also routinely conducts dynamic analyses.
> 
> Also in the first link it says congress has made increasing something or other for dynamic scoring, which to me clearly reads as "They have been getting better and better at it" and not, "They aren't getting any and put more and more pressure from it."
> 
> I am sure that they have a good level of dynamic scoring and not just static scoring.



CBO is required to score using the numbers furnished to it by the President or Congress or sub group requesting an analysis.  And usually that is using the static system, though conservaties will always push for the dynamic approach on the theory that tax policy does change the way people behave with their finances and does change the way they do business.  Ditto regulatory policy and various mandates.

As long as Congress and the President, whether Democrat or Republican, continues to use the smoke and mirrors approach of baseline budgeting, they will continue to be dishonest re spending increases, spending cuts, and other money management issues.  It also ensures that economy will never be utilized by any bureaucracy or spending group and that maximum spending possible will be the rule. 

So it really doesn't matter how anything is scored, does it.


----------



## catatomic

Foxfyre said:


> catatomic said:
> 
> 
> 
> I don't know Rabbi...
> 
> After I looked at the fourth paragraph of "Dynamic Scoring: Not so fast" it says,
> 
> The JCT has done similar studies of other tax options, as well. The Congressional Budget Office (CBO) also routinely conducts dynamic analyses.
> 
> Also in the first link it says congress has made increasing something or other for dynamic scoring, which to me clearly reads as "They have been getting better and better at it" and not, "They aren't getting any and put more and more pressure from it."
> 
> I am sure that they have a good level of dynamic scoring and not just static scoring.
> 
> 
> 
> 
> 
> 
> 
> FoxFire said:
> 
> 
> 
> 
> CBO is required to score using the numbers furnished to it by the President or Congress or sub group requesting an analysis.
> 
> Click to expand...
> 
> 
> Yes that is called raw data.  Of course they have it correctly to them.
> 
> 
> 
> 
> And usually that is using the static system, though conservaties will always push for the dynamic approach on the theory that tax policy does change the way people behave with their finances and does change the way they do business.
> 
> Click to expand...
> 
> 
> No the data is just data.  The analysis is what we are talking about being the static or dynamic system.
> 
> 
> 
> 
> Ditto regulatory policy and various mandates.
> 
> As long as Congress and the President, whether Democrat or Republican, continues to use the smoke and mirrors approach of baseline budgeting, they will continue to be dishonest re spending increases, spending cuts, and other money management issues.
> 
> Click to expand...
> 
> 
> Dishonest together?
> 
> 
> 
> 
> It also ensures that economy will never be utilized by any bureaucracy or spending group and that maximum spending possible will be the rule.
> 
> Click to expand...
> 
> 
> Actually it says that tax hikes and spending cuts relieve the debt to a certain extent and that spending cuts are twice as important as tax increases, hardly what Barack Obama or Republicans probably wants to say.  I said this in my first post.
> 
> 
> 
> 
> So it really doesn't matter how anything is scored, does it.
> 
> Click to expand...
> 
> 
> Yes it does.
Click to expand...


----------



## Foxfyre

catatomic said:


> Foxfyre said:
> 
> 
> 
> 
> 
> catatomic said:
> 
> 
> 
> I don't know Rabbi...
> 
> After I looked at the fourth paragraph of "Dynamic Scoring: Not so fast" it says,
> 
> The JCT has done similar studies of other tax options, as well. The Congressional Budget Office (CBO) also routinely conducts dynamic analyses.
> 
> Also in the first link it says congress has made increasing something or other for dynamic scoring, which to me clearly reads as "They have been getting better and better at it" and not, "They aren't getting any and put more and more pressure from it."
> 
> I am sure that they have a good level of dynamic scoring and not just static scoring.
> 
> 
> 
> 
> 
> 
> Yes that is called raw data.  Of course they have it correctly to them.
> 
> 
> 
> No the data is just data.  The analysis is what we are talking about being the static or dynamic system.
> 
> 
> 
> Dishonest together?
> 
> 
> 
> Actually it says that tax hikes and spending cuts relieve the debt to a certain extent and that spending cuts are twice as important as tax increases, hardly what Barack Obama or Republicans probably wants to say.  I said this in my first post.
> 
> 
> 
> 
> So it really doesn't matter how anything is scored, does it.
> 
> Click to expand...
> 
> 
> Yes it does.
> 
> Click to expand...
> 
> 
> Yes dishonest together, and no, the Republicans are not exempt from that either.  The point is, that as long as they use static methods for scoring, and baseline budgeting methods to determine spending, it doesn't matter how anything is scored.  Can you name any significant spending program that has EVER even remotely resembled the CBO scoring after it was all said and done?  Or any program that they ever looked back at the original scoring and said, wow, we sure got that wrong.
> 
> Nope they just use the new amount to budget for the next round of spending.  And that is true even if something was budgeted to be a one time expenditure.  Don't need as much money in Iraq?  It is never, well we don't have to spend that now.  It is, well, we have all that savings now to spend on something else.
> 
> Cut spending a trillion dollars over the next 10 years?  That is $100 billion per year against $1 trillion deficits as far as the eye can see.   Cut spending $5 trillion over 10 years?  That would cut the deficitt in half assuming that new spending was not added at the other end.  Which it always is.
> 
> And even if future Congresses honor the intent, budget cuts are illusionary because it is cuts from a budget developed from the baseline; i.e. the current year's expenditures.  It is a presumed reduction in the projected increase and not a real cut at all.
Click to expand...


----------



## catatomic

I understand your disillusionment but I'm not convinced it's so static.


----------



## Foxfyre

I may be disallusioned, but I damn sure know enough about baseline budgeting and economics to be pretty darn confident that I am right. And I know that a cut in the projected budget is not necessarily a cut in spending.


----------



## The Rabbi

Foxfyre said:


> I may be disallusioned, but I damn sure know enough about baseline budgeting and economics to be pretty darn confident that I am right. And I know that a cut in the projected budget is not necessarily a cut in spending.



No.  It's like this:
Let's say you decide you want a new Harley.  You budget $25,000 for it.  You've put away say $2,000 already.  Then your wife decides she wants a trip to Spain instead and it's going to cost $15,000.  So you scrap the Harley and now you have an extra $23,000 to spend and charge it all on the credit card.


----------



## Foxfyre

The Rabbi said:


> Foxfyre said:
> 
> 
> 
> I may be disallusioned, but I damn sure know enough about baseline budgeting and economics to be pretty darn confident that I am right. And I know that a cut in the projected budget is not necessarily a cut in spending.
> 
> 
> 
> 
> No.  It's like this:
> Let's say you decide you want a new Harley.  You budget $25,000 for it.  You've put away say $2,000 already.  Then your wife decides she wants a trip to Spain instead and it's going to cost $15,000.  So you scrap the Harley and now you have an extra $23,000 to spend and charge it all on the credit card.
Click to expand...


Yep.  That's pretty much how it works.

And then you take the trip to Spain and run up $13k on your credit card.  Next year you aren't going to Spain.  Hey, I don't have to pay for a trip to Spain next year.  We have $15k to spend on a cruise to Australia!  Or, if you are doing baseline budgeting, you have $20k for a cruise to Australia.    But we'll cut 10% of the spending and only plan to spend $18k for next year's cruise.  And everybody will be so proud of us.  We cut spending!


----------



## Sactowndog

Wiseacre said:


> Well, sorta, I got lost in your scenario fairly quickly.   I ain't the sharpest knife in the drawer, and this stuff rapidly gets complicated.   I'm not an accountant or a tax expert, or even an economist, just trying to understand this whole deal.   That said, my understanding is that if you are a non-resident alien then you don't pay taxes here on capital gains, you do that in your own country whatever the CG rate is there.   That means you had to renounce your US citizenship, which is happening these days, over a thousand a year.   I think you gotta be out of the country for at least 3 years though.   Anyway, if rich folks are renouncing their US citizneship for tax purposes because the income taxes or CG taxes are too high, that's a negative for the economy and jobs.   Cuz those people ain't here spending money and investing as US citizens any more.



I am sorry, I can't communicate this more clearly.  I can't think of another way to communicate it but you are still missing the main point.  Where you live no longer matters where you invest.  So yes we would lose what they spend which is small in the overall context but would not likely lose what they invest.



Wiseacre said:


> If you are an American, you pay our taxes no matter where you live or where you earn your income.   Same deal if you are a resident alien living here, you are subject to the same tax rates as the rest of us.   Sorry 'bout that.   Which is one reason why higher CG and income rates discourage resident aliens from investing and staying here.   I do not believe this is trivial either, over the past 30 years or so foreign investors have provided a significant chunk of capital into our economy.



Again where you live and where you invest is no longer correlated.  This fact is especially true for the very wealthy.  It was true in the 1980's but it is not true any longer.  A low coporate income tax will attract foreign investment and a low capital gains tax will do nothing to do so.



Wiseacre said:


> Same deal with American investors, wherever they live.   A higher cap gains rate disincentivizes them to put their money to good use on our economy.   Maybe they don't invest it overseas, but we lose if that money if it's not invested here.   Maybe they put it in tax free investments, or find creative ways to lower their tax burden.   Long story short, there's no way a higher CG tax rate can be beneficial to an economy unless you're fighting inflation or the economy is overheating.



You can make the case that a higher capital gains tax would cause them to seek less risky investments WW.  But remember the case I made was to increase the capital gains rate so that you can reduce the corporate income tax by the same amount.  You missing and not accounting for those afffects.



Wiseacre said:


> The corp tax rate thing kinda muddied the waters a little for me.   Don't quite see the link with cap gains, one is for investors and the other is for employees.   A lower corp tax rate definitely makes a country more attractive for entrepeneurs to startup a business or expand one ormaybe even relocate one.   There's a lotta other factors to that though, but the fact is that many countries and US states are trying to do exactly that, attractmore business and hence more jobs and hence more revenue.



Replace entrepenuers with investors and you will start to be there once you realize that investors can as likely be from Japan as the US.  The lower corporate tax rate will make investing in the US more attractive both for those living in the US and those residing overseas.


----------



## Wiseacre

Sactowndog said:


> Wiseacre said:
> 
> 
> 
> Well, sorta, I got lost in your scenario fairly quickly.   I ain't the sharpest knife in the drawer, and this stuff rapidly gets complicated.   I'm not an accountant or a tax expert, or even an economist, just trying to understand this whole deal.   That said, my understanding is that if you are a non-resident alien then you don't pay taxes here on capital gains, you do that in your own country whatever the CG rate is there.   That means you had to renounce your US citizenship, which is happening these days, over a thousand a year.   I think you gotta be out of the country for at least 3 years though.   Anyway, if rich folks are renouncing their US citizneship for tax purposes because the income taxes or CG taxes are too high, that's a negative for the economy and jobs.   Cuz those people ain't here spending money and investing as US citizens any more.
> 
> 
> 
> 
> I am sorry, I can't communicate this more clearly.  I can't think of another way to communicate it but you are still missing the main point.  Where you live no longer matters where you invest.  So yes we would lose what they spend which is small in the overall context but would not likely lose what they invest.
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> If you are an American, you pay our taxes no matter where you live or where you earn your income.   Same deal if you are a resident alien living here, you are subject to the same tax rates as the rest of us.   Sorry 'bout that.   Which is one reason why higher CG and income rates discourage resident aliens from investing and staying here.   I do not believe this is trivial either, over the past 30 years or so foreign investors have provided a significant chunk of capital into our economy.
> 
> Click to expand...
> 
> 
> Again where you live and where you invest is no longer correlated.  This fact is especially true for the very wealthy.  It was true in the 1980's but it is not true any longer.  A low coporate income tax will attract foreign investment and a low capital gains tax will do nothing to do so.
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> Same deal with American investors, wherever they live.   A higher cap gains rate disincentivizes them to put their money to good use on our economy.   Maybe they don't invest it overseas, but we lose if that money if it's not invested here.   Maybe they put it in tax free investments, or find creative ways to lower their tax burden.   Long story short, there's no way a higher CG tax rate can be beneficial to an economy unless you're fighting inflation or the economy is overheating.
> 
> Click to expand...
> 
> 
> You can make the case that a higher capital gains tax would cause them to seek less risky investments WW.  But remember the case I made was to increase the capital gains rate so that you can reduce the corporate income tax by the same amount.  You missing and not accounting for those afffects.
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> The corp tax rate thing kinda muddied the waters a little for me.   Don't quite see the link with cap gains, one is for investors and the other is for employees.   A lower corp tax rate definitely makes a country more attractive for entrepeneurs to startup a business or expand one ormaybe even relocate one.   There's a lotta other factors to that though, but the fact is that many countries and US states are trying to do exactly that, attractmore business and hence more jobs and hence more revenue.
> 
> Click to expand...
> 
> 
> Replace entrepenuers with investors and you will start to be there once you realize that investors can as likely be from Japan as the US.  The lower corporate tax rate will make investing in the US more attractive both for those living in the US and those residing overseas.
Click to expand...


We are talking past each other or perhaps one of us is somewhat mistaken.   The notion that a higher CG rate can possibly be a positive for economic growth is nonsense.   Those with the funds to invest the most will be less inclined to do so, no matter where they live or where they invest.   Obviously if they are instead investing in non-taxable avenues, that does our economy no good;  you see that, right?   

A lower corp tax rate would also be more attractive to investors, but why raise one and lower the other?   Why not lower BOTH?   Or leave the CG rate where it is and lower the corp tax rate?


----------



## saveliberty

T minus 20 days and counting on the cliff.  Obama is still waiting for the mountain to come to him.


----------



## oldfart

Foxfyre said:


> I may be disallusioned, but I damn sure know enough about baseline budgeting and economics to be pretty darn confident that I am right. And I know that a cut in the projected budget is not necessarily a cut in spending.



I think your nihilism is getting the best of you.  If scoring systems don't matter and all budget projections are worthless, what do you base your opinions on policy on?  Entrails of a chicken?
Your attitude may be very emotionally satisfying, but it makes it impossible for anyone to have a discussion with you when you use this kind of argument to shut down all who disagree with you. You come over as something like a conspiracy nutcase, which I believe you are not.  

If you really have a background in economics, use it and discuss issues, don't just bail because you don't like the process.


----------



## oldfart

The Rabbi said:


> No.  It's like this:
> Let's say you decide you want a new Harley.  You budget $25,000 for it.  You've put away say $2,000 already.  Then your wife decides she wants a trip to Spain instead and it's going to cost $15,000.  So you scrap the Harley and now you have an extra $23,000 to spend and charge it all on the credit card.



I was wondering where my wife got that argument from.  I want my Harley back!


----------



## saveliberty

Bad information in yields poor results and recommendations out.  Foxfyre makes a perfectly valid and true statement in saying a budget cut don't necessarily result in spending cuts.  If you want to accept a bad model, clearly you have motives which run counter to good fiscal management oldfart.


----------



## Foxfyre

oldfart said:


> Foxfyre said:
> 
> 
> 
> I may be disallusioned, but I damn sure know enough about baseline budgeting and economics to be pretty darn confident that I am right. And I know that a cut in the projected budget is not necessarily a cut in spending.
> 
> 
> 
> 
> I think your nihilism is getting the best of you.  If scoring systems don't matter and all budget projections are worthless, what do you base your opinions on policy on?  Entrails of a chicken?
> Your attitude may be very emotionally satisfying, but it makes it impossible for anyone to have a discussion with you when you use this kind of argument to shut down all who disagree with you. You come over as something like a conspiracy nutcase, which I believe you are not.
> 
> If you really have a background in economics, use it and discuss issues, don't just bail because you don't like the process.
Click to expand...


Scoring is meaningless if they feed the CBO numbers that will produce the desired projections; most especially when subsequent Congresses pay no attention to the scoring and feel no responsibility to respecvt it.  When they send a proposed project to the CBO to be scored, they aren't interested in what the actual costs will be.  They just want to be able to sell it now as economically sound.  They know full well they won't take the heat when those numbers don't hold up when static scoring doesn't hold up on down the road.

In 1965, Medicare was scored to cost $9 billion by 1990.  The actual cost in 1990 was $67 billion and last year the costs had swelled to $690 billion.  .

In 1967, the House Ways and Means Committee said the entire Medicare program would cost $12 billion in 1990. The actual cost in 1990 was $98 billion.  In 1987 Medicaid was scored at less than one billion in 1992.  Actual cost $17 billion.  Last year around $275 billion.

The list goes on. The 1993 cost of Medicare's home care benefit was projected in 1988 to be $4 billion, but ended up at $10 billion. The State Children's Health Insurance Program (SCHIP), which was created in 1997 and projected to cost $5 billion per year, has had to be supplemented with hundreds of millions of dollars annually by Congress and almost immediately after his first swearing in, Obama signed a $33 billion bill that would add 4 million mostly low income kids to the SCHIP program over the next 4-1/2 years..

I will guess that you cannot name a single large government program in which the costs even remotely resemble the initial CBO scoring.


----------



## catatomic

Laffer  Curve

I looked up supply side economics to find the Laffer Curve.

It plots tax revenue (y-axis) vs. tax rate (x-axis).  If taxes are 0 or 100 %, obviously no money comes in.  Between that, you get a concave graph with maximum revenue, say, somewhere around 70 %.  It is implicit in the way this graph works that you wouldn&#8217;t do it unless you knew how many people would be employed in each bracket.  That&#8217;s dynamic.

I can also think of the idea of a spending curve, with a mark at current level, and the ability to see 0 revenue coming in nor out from 0 spending (it doesn&#8217;t cost anything), to the point where the nation goes bankrupt.  It is a negative, sloped downward graph.

Put them together and you can make ordinary differential equations to measure your success with a given set of data.  The last of all data necessary to make a full dynamic analysis is just 3 months back, at a quarterly report.  Then you can run the model in the computer, assuming someone hooked up with congress knows how to do all this.

But because of the time lag, you can look at all the things you want that might cause aberrations, like energy increase, investment decrease, manufacturing increase, and real estate increase.  As much as things stay the same or trend the thing, one can probably still have a good model from 3 months ago.

That is all I can help you with to make your own decision.  I trust it would be easy for them to do this and that they could anticipate aberrations and plug in data they foresee earlier than 3 months later.  I also trust that the general conclusions will usually stay put for 3 months, because we can look back over years of data and usually the results have stayed the same.


----------



## The Rabbi

Foxfyre said:


> oldfart said:
> 
> 
> 
> 
> 
> Foxfyre said:
> 
> 
> 
> I may be disallusioned, but I damn sure know enough about baseline budgeting and economics to be pretty darn confident that I am right. And I know that a cut in the projected budget is not necessarily a cut in spending.
> 
> 
> 
> 
> I think your nihilism is getting the best of you.  If scoring systems don't matter and all budget projections are worthless, what do you base your opinions on policy on?  Entrails of a chicken?
> Your attitude may be very emotionally satisfying, but it makes it impossible for anyone to have a discussion with you when you use this kind of argument to shut down all who disagree with you. You come over as something like a conspiracy nutcase, which I believe you are not.
> 
> If you really have a background in economics, use it and discuss issues, don't just bail because you don't like the process.
> 
> Click to expand...
> 
> 
> Scoring is meaningless if they feed the CBO numbers that will produce the desired projections; most especially when subsequent Congresses pay no attention to the scoring and feel no responsibility to respecvt it.  When they send a proposed project to the CBO to be scored, they aren't interested in what the actual costs will be.  They just want to be able to sell it now as economically sound.  They know full well they won't take the heat when those numbers don't hold up when static scoring doesn't hold up on down the road.
> 
> In 1965, Medicare was scored to cost $9 billion by 1990.  The actual cost in 1990 was $67 billion and last year the costs had swelled to $690 billion.  .
> 
> In 1967, the House Ways and Means Committee said the entire Medicare program would cost $12 billion in 1990. The actual cost in 1990 was $98 billion.  In 1987 Medicaid was scored at less than one billion in 1992.  Actual cost $17 billion.  Last year around $275 billion.
> 
> The list goes on. The 1993 cost of Medicare's home care benefit was projected in 1988 to be $4 billion, but ended up at $10 billion. The State Children's Health Insurance Program (SCHIP), which was created in 1997 and projected to cost $5 billion per year, has had to be supplemented with hundreds of millions of dollars annually by Congress and almost immediately after his first swearing in, Obama signed a $33 billion bill that would add 4 million mostly low income kids to the SCHIP program over the next 4-1/2 years..
> 
> I will guess that you cannot name a single large government program in which the costs even remotely resemble the initial CBO scoring.
Click to expand...


You nailed it.  The Dems (GOP too probably) have figured out how to game the CBO to get the numbers they want.  That is how the CBO reported that Obamacare would not cost more than $999B for the next 10years.  No one believed that number.  Not even the CBO.


----------



## catatomic

When you have dual differential equations like I said, there can be huge aberrations over long periods of time because of unforeseen long-term effects.  But when you have short-time ago data, it can be used wisely to understand consequences of taxing and spending.


----------



## Foxfyre

catatomic said:


> When you have dual differential equations like I said, there can be huge aberrations over long periods of time because of unforeseen long-term effects.  But when you have short-time ago data, it can be used wisely to understand consequences of taxing and spending.



It would be so if they used the dynamic means of scoring and were informed by the real time history of various tax policy and wrote the legislation based on that information.  They don't.  The CBO is fed numbers and a scenario to produce the desired projection.  If the projection isn't what the promoters of the legislation were looking for, they throw in some kind of mythical cut, like cutting $1 trillion in waste and/or saving X dollars by eliminating fraud.  Never in the history of the U.S. Congress in our lifetime have such cuts or elimination of fraud produced a single dime for the U.S. treasury.  It is all smoke and mirrors.  And it is high time the American public realized it and did something about it.


----------



## catatomic

I don't need to read this.


----------



## Foxfyre

The only real numbers are the actual government outlays and the actual deficit which is total expenditures less the total revenues.  Currently we are spending $1 trillion or more than revenues every single year and that is projected to continue as far as the eye can see.  And if it continues, the fiscal cliff will be the least of our worries.  National bankruptcy is a certainty.

The ONLY thing that will divert that disaster is a policy that downsizes government and reins in all unnecessary spending and leaves the money with the private sector with assurance that the private sector will not be punished for producing profits and/or growing their businesses.  Right now that is the exact opposite of what the Administration is asking for.   A fully employed and productive working America and a steadily reducing entitlement will generate massive funds into the U.S. treasury and bring down the deficit.  With the right policies, it will wipe out the deficit which such policies did for a brief period at the end of the Clinton administration.

Government spending and reducing unemployment by hiring more government employees won't fix the problem and will absolutely make it worse.


----------



## Foxfyre

catatomic said:


> I don't need to listen to this.



Yes, you really do need to be educated on this.  I accept that you choose not to be.


----------



## Trajan

Sactowndog said:


> Bern80 said:
> 
> 
> 
> 
> 
> auditor0007 said:
> 
> 
> 
> There are so many problems when looking at this from any perspective.  First off, there is some merit to the idea that raising taxes will hurt more than help, at least in the short term.  The problem is that we have gotten ourselves into a severe pickle because we have used tax cuts over the past decade plus as a way to stimulate the economy.  Problem is, the tax cuts only helped in short stints, but in the long run, it did nothing.  We can't cut taxes any further to stimulate the economy because revenue has hit rock bottom due to the already low tax rates.
> 
> So what about spending?  Well, we could cut some here and there, but nobody can agree where to cut.  In the end, there is not going to be a simple solution, and this storm is going to be with us for some time; we're going to just have to ride it out.  My thoughts are that we end the payroll tax cut, and raise the tax rate on anyone making over $100,000 per year.  The rate increase does not need to be massive.  Secondly, raise the tax rate on capital gains to 20% with the idea of raising it higher once the economy gets rolling again, if necessary.  As for cuts, the easiest way to cut spending is to freeze it across the board, other than for SS and Medicare.  As for the long term, SS and Medicare spending must be reduced in comparison to what we are expecting to pay out.  We can't cut spending on those programs because we have more and more people retiring.  What we can do is raise the retirement age gradually for everyone until we hit a point where revenue and payouts are close to being balanced for the long term.
> 
> One thing nobody thinks about is that if we do what needs to be done to get spending under control, even if it is done slowly, the economy is going to pick up eventually.  There are two factors to look at that have nothing to do with politicians, taxation, or government spending.  The baby boomers are all retiring.  Even if they haven't retired yet, they are downsizing and not spending as much money anymore.  This wouldn't be such a problem but for the fact that their kids have delayed starting their own families.  While there are reasons for this, mostly economic, they are starting to hit the age where they have to begin getting married and having kids.  My thought is that within the next ten years, we are going to see a boom in child births which will lead to a lot of younger people needing to buy homes and bigger cars.  The spending cycle will kick into high gear once again, and then we will see things improve dramatically.
> 
> 
> 
> 
> Arguments like this unfortunately miss the big picture. When you argue for increasing government revenue one has to do so under the assumption that the government actually needs more money. That is the assumption that needs to be tackled first if we're ever going to get out of this. Instead of trying to figure out how to get the government more money, we should first be trying to figure out what does government actually need. Once we figure that out we can then devise a tax policy that ensures they get it.
> 
> Click to expand...
> 
> 
> Actually this is pretty much known.  Most people look at ~19-20% of GDP as the amount of spending needed.  A little less in good times and a little more in a recession.  Revenues are currently in the 16-17% of GDP and have to come up for us to get to a balanced budget and maintain the things we currently say we want to have.
> 
> Now if we want to go back to an isolationist defense policy or eliminate Medicare or Social Security then we could drop the percentage but with those priorities you are in the 19-20% range.
Click to expand...


huh? 


actually what you need is a BIGGER PIE of gdp so the slice either 17 or 19% yields more $$$.

 Its not a coincidence that everyone has figured out and now agree that no matter the tax policy ala rates etc, the gov won't get more than a 20% slice on a consistent basis. 

But then theres the old ideological/pathological angle, the need to grab/employ higher rates as a politically  gratuitous toolforf axe grinding. 

Its far better to get a 18% slice of 120, than an 19% slice at 100...see?

 Its all a matter of incentivizing  correctly to create more and sustained taxable activity.


----------



## saveliberty

Expecting math skill Trajan?

<shakes head>


----------



## oldfart

My two cents worth.  



Wiseacre said:


> The notion that a higher CG rate can possibly be a positive for economic growth is nonsense.


It all depends on what behavior model you have for investors and their expectations.  Right now a lot of commercial real estate deals are trying to close by the end of December under the assumption that capital gains rates will rise in 2013.  To the extent that some of this real estate is underutilized now and will be more aggressively utilized by the buyers, the anticipation of future higher capital gains rates may be marginally promoting economic growth.  But this is a temporary effect and in general it is hard to see how with very low rates of anticipated inflation and low real interest rates that raising capital gains rates is helpful to the economy.  



Wiseacre said:


> Obviously if they are instead investing in non-taxable avenues, that does our economy no good


I'm not sure I understand the reasoning here.  
1.  The only significant non-taxable investments are state and municipal obligations.  Changes in income tax rates (but not necessarily capital gains rates) would increase the value of such bonds relative to securities generating taxable interest.  I'll pass on the arguments over whether money raised by corporate bonds is better spent than money raised by state and municipal bonds.  
2.  Higher tax rates, including capital gains rates, increases the value of tax deferral, such as in annuities and unrealized capital gains.  If such rates are expected to decrease in the future, investors will be even more likely to attempt to defer taking gains in the short term.  Likewise at very low real interest rates the cost of deferring taxes is cheaper.  To the extent people sit on underutilized investments, economic growth suffers.   



Wiseacre said:


> A lower corp tax rate would also be more attractive to investors, but why raise one and lower the other?   Why not lower BOTH?   Or leave the CG rate where it is and lower the corp tax rate?


A good point.  Personally I would prefer to lower the corporate income tax rate to the current average rate and eliminate most corporate tax preferences.  At first glance this is revenue neutral, but because of the distorting effects on the economy of the many credits  and deductions intended to help specific industries and groups,  I think efficiency and growth would be improved.  Such a rate would settle down to around 16%.


----------



## The Rabbi

oldfart said:


> My two cents worth.
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> The notion that a higher CG rate can possibly be a positive for economic growth is nonsense.
> 
> 
> 
> It all depends on what behavior model you have for investors and their expectations.  Right now a lot of commercial real estate deals are trying to close by the end of December under the assumption that capital gains rates will rise in 2013.  To the extent that some of this real estate is underutilized now and will be more aggressively utilized by the buyers, the anticipation of future higher capital gains rates may be marginally promoting economic growth.  But this is a temporary effect and in general it is hard to see how with very low rates of anticipated inflation and low real interest rates that raising capital gains rates is helpful to the economy.
> 
> .
Click to expand...


That's the Obama model of economics.  Cram future demand into the present and hope for the best.  The umbers this year look better probably because a lot of people are taking gains and making use of Bush-era tax rates in anticipation of next year being worse.  But that only robs from the future for today.  It isn't sustainable at all.


----------



## Foxfyre

The Rabbi said:


> oldfart said:
> 
> 
> 
> My two cents worth.
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> The notion that a higher CG rate can possibly be a positive for economic growth is nonsense.
> 
> 
> 
> It all depends on what behavior model you have for investors and their expectations.  Right now a lot of commercial real estate deals are trying to close by the end of December under the assumption that capital gains rates will rise in 2013.  To the extent that some of this real estate is underutilized now and will be more aggressively utilized by the buyers, the anticipation of future higher capital gains rates may be marginally promoting economic growth.  But this is a temporary effect and in general it is hard to see how with very low rates of anticipated inflation and low real interest rates that raising capital gains rates is helpful to the economy.
> 
> .
> 
> Click to expand...
> 
> 
> That's the Obama model of economics.  Cram future demand into the present and hope for the best.  The umbers this year look better probably because a lot of people are taking gains and making use of Bush-era tax rates in anticipation of next year being worse.  But that only robs from the future for today.  It isn't sustainable at all.
Click to expand...


More to the point, the Obama model is to apply the tax liability immediately, and agree to spending cuts that will kick in later and be spread over a decade or so.  Which as we have already discussed, means they won't ever happen.


----------



## Trajan

The Rabbi said:


> oldfart said:
> 
> 
> 
> My two cents worth.
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> The notion that a higher CG rate can possibly be a positive for economic growth is nonsense.
> 
> 
> 
> It all depends on what behavior model you have for investors and their expectations.  Right now a lot of commercial real estate deals are trying to close by the end of December under the assumption that capital gains rates will rise in 2013.  To the extent that some of this real estate is underutilized now and will be more aggressively utilized by the buyers, the anticipation of future higher capital gains rates may be marginally promoting economic growth.  But this is a temporary effect and in general it is hard to see how with very low rates of anticipated inflation and low real interest rates that raising capital gains rates is helpful to the economy.
> 
> .
> 
> Click to expand...
> 
> 
> That's the Obama model of economics.  Cram future demand into the present and hope for the best.  The umbers this year look better probably because a lot of people are taking gains and making use of Bush-era tax rates in anticipation of next year being worse.  But that only robs from the future for today.  It isn't sustainable at all.
Click to expand...


Costco is borrowing to provide a $7 dividend this calender year........yes you heard that right, whats that tell us?

 And the CEO of Costco is an Obama fan, big time too.


----------



## saveliberty

American society is closer to breaking down than ever before. 

Obama helps finish the job of addicting half of the US to government handouts. Then when the other half finally has enough, the handout crowd feels entitled to take from all the others.  Stealing direcctly forces the working folks to stay at home and defend theor property.  No one works and we have to start all over.  THAT is the true cliff.


----------



## Wiseacre

oldfart said:


> My two cents worth.
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> The notion that a higher CG rate can possibly be a positive for economic growth is nonsense.
> 
> 
> 
> It all depends on what behavior model you have for investors and their expectations.  Right now a lot of commercial real estate deals are trying to close by the end of December under the assumption that capital gains rates will rise in 2013.  To the extent that some of this real estate is underutilized now and will be more aggressively utilized by the buyers, the anticipation of future higher capital gains rates may be marginally promoting economic growth.  But this is a temporary effect and in general it is hard to see how with very low rates of anticipated inflation and low real interest rates that raising capital gains rates is helpful to the economy.
> 
> One wonders how aggressive buyers will be, especially in the short term.   I wouldn't expect much investment to go forward with those commercial real estate properties until there is a perceived sustained uptick in demand.   I might add that for every buyer getting in there is also a seller getting out;  seems like a wash to me.
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> Obviously if they are instead investing in non-taxable avenues, that does our economy no good
> 
> Click to expand...
> 
> 
> I'm not sure I understand the reasoning here.
> 1.  The only significant non-taxable investments are state and municipal obligations.  Changes in income tax rates (but not necessarily capital gains rates) would increase the value of such bonds relative to securities generating taxable interest.  I'll pass on the arguments over whether money raised by corporate bonds is better spent than money raised by state and municipal bonds.
> 2.  Higher tax rates, including capital gains rates, increases the value of tax deferral, such as in annuities and unrealized capital gains.  If such rates are expected to decrease in the future, investors will be even more likely to attempt to defer taking gains in the short term.  Likewise at very low real interest rates the cost of deferring taxes is cheaper.  To the extent people sit on underutilized investments, economic growth suffers.
> 
> What about gold?   Or real estate or tax shelters of some kind?   Instead of puting it to work in ways that would be better for economic growth, the rich guys pull back and resort to other avenues, whatever they may be.   My basic point though, is that when you raise taxes on something you discourage it;  whether or not there is a little reverse thing going on in a few cases is debateable, but for the most part a higher CG rate is going to reduce economic growth from what it might have been.
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> A lower corp tax rate would also be more attractive to investors, but why raise one and lower the other?   Why not lower BOTH?   Or leave the CG rate where it is and lower the corp tax rate?
> 
> Click to expand...
> 
> A good point.  Personally I would prefer to lower the corporate income tax rate to the current average rate and eliminate most corporate tax preferences.  At first glance this is revenue neutral, but because of the distorting effects on the economy of the many credits  and deductions intended to help specific industries and groups,  I think efficiency and growth would be improved.  Such a rate would settle down to around 16%.
Click to expand...


100% agree, along with reducing or eliminating the subsidies that some industries get that others don't.   Most of it goes to the biggest ones, which is probably not the original intention.   And I do think it stinks that some big corps pay nothing at all in corp taxes, and even have credit built up for future taxes.


----------



## Foxfyre

Wiseacre said:


> oldfart said:
> 
> 
> 
> My two cents worth.
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> The notion that a higher CG rate can possibly be a positive for economic growth is nonsense.
> 
> 
> 
> It all depends on what behavior model you have for investors and their expectations.  Right now a lot of commercial real estate deals are trying to close by the end of December under the assumption that capital gains rates will rise in 2013.  To the extent that some of this real estate is underutilized now and will be more aggressively utilized by the buyers, the anticipation of future higher capital gains rates may be marginally promoting economic growth.  But this is a temporary effect and in general it is hard to see how with very low rates of anticipated inflation and low real interest rates that raising capital gains rates is helpful to the economy.
> 
> One wonders how aggressive buyers will be, especially in the short term.   I wouldn't expect much investment to go forward with those commercial real estate properties until there is a perceived sustained uptick in demand.   I might add that for every buyer getting in there is also a seller getting out;  seems like a wash to me.
> 
> 
> 
> I'm not sure I understand the reasoning here.
> 1.  The only significant non-taxable investments are state and municipal obligations.  Changes in income tax rates (but not necessarily capital gains rates) would increase the value of such bonds relative to securities generating taxable interest.  I'll pass on the arguments over whether money raised by corporate bonds is better spent than money raised by state and municipal bonds.
> 2.  Higher tax rates, including capital gains rates, increases the value of tax deferral, such as in annuities and unrealized capital gains.  If such rates are expected to decrease in the future, investors will be even more likely to attempt to defer taking gains in the short term.  Likewise at very low real interest rates the cost of deferring taxes is cheaper.  To the extent people sit on underutilized investments, economic growth suffers.
> 
> What about gold?   Or real estate or tax shelters of some kind?   Instead of puting it to work in ways that would be better for economic growth, the rich guys pull back and resort to other avenues, whatever they may be.   My basic point though, is that when you raise taxes on something you discourage it;  whether or not there is a little reverse thing going on in a few cases is debateable, but for the most part a higher CG rate is going to reduce economic growth from what it might have been.
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> A lower corp tax rate would also be more attractive to investors, but why raise one and lower the other?   Why not lower BOTH?   Or leave the CG rate where it is and lower the corp tax rate?
> 
> Click to expand...
> 
> A good point.  Personally I would prefer to lower the corporate income tax rate to the current average rate and eliminate most corporate tax preferences.  At first glance this is revenue neutral, but because of the distorting effects on the economy of the many credits  and deductions intended to help specific industries and groups,  I think efficiency and growth would be improved.  Such a rate would settle down to around 16%.
> 
> Click to expand...
> 
> 
> 100% agree, along with reducing or eliminating the subsidies that some industries get that others don't.   Most of it goes to the biggest ones, which is probably not the original intention.   And I do think it stinks that some big corps pay nothing at all in corp taxes, and even have credit built up for future taxes.
Click to expand...


Ah yes, those subsidies to big corporations.  Like oil companies?  But the dirty little secret is, no liberal is likely to vote to kill them.  

Take big oil for instance that currently is receiving about $4.5 billion in subsidies.

$1+ billion of that is for the strategic petroleum reserve.
$1 or so billion is farm fuel credits tor highway taxes on the theory that most farm equipment doesn't use those highways.
A another big chunk goes for the low-income households fuel credits and most of the rest for green energy programs.
The Surprising Reason That Oil Subsidies Persist: Even Liberals Love Them - Forbes

Do you really think those with high powered environmental constituencies will vote to stop subsidizing the Chevy Volt?

Oil companies and every other large corporation enjoys handsome subsidies for keeping operations in the USA and not shipping jobs overseas.

All this is to say that almost every budget item is tied up inside some program or project with a noble sounding title, whether or not it actually accomplishes anything, and any attempt to kill it evokes howls from whoever's ox is being gored.

All of which gave us the wonderful invention of baseline budgeting to ensure that nobody has to ever sacrifice a sacred cow.


----------



## Wiseacre

Foxfyre said:


> Wiseacre said:
> 
> 
> 
> 
> 
> oldfart said:
> 
> 
> 
> My two cents worth.
> 
> 
> It all depends on what behavior model you have for investors and their expectations.  Right now a lot of commercial real estate deals are trying to close by the end of December under the assumption that capital gains rates will rise in 2013.  To the extent that some of this real estate is underutilized now and will be more aggressively utilized by the buyers, the anticipation of future higher capital gains rates may be marginally promoting economic growth.  But this is a temporary effect and in general it is hard to see how with very low rates of anticipated inflation and low real interest rates that raising capital gains rates is helpful to the economy.
> 
> One wonders how aggressive buyers will be, especially in the short term.   I wouldn't expect much investment to go forward with those commercial real estate properties until there is a perceived sustained uptick in demand.   I might add that for every buyer getting in there is also a seller getting out;  seems like a wash to me.
> 
> 
> 
> I'm not sure I understand the reasoning here.
> 1.  The only significant non-taxable investments are state and municipal obligations.  Changes in income tax rates (but not necessarily capital gains rates) would increase the value of such bonds relative to securities generating taxable interest.  I'll pass on the arguments over whether money raised by corporate bonds is better spent than money raised by state and municipal bonds.
> 2.  Higher tax rates, including capital gains rates, increases the value of tax deferral, such as in annuities and unrealized capital gains.  If such rates are expected to decrease in the future, investors will be even more likely to attempt to defer taking gains in the short term.  Likewise at very low real interest rates the cost of deferring taxes is cheaper.  To the extent people sit on underutilized investments, economic growth suffers.
> 
> What about gold?   Or real estate or tax shelters of some kind?   Instead of puting it to work in ways that would be better for economic growth, the rich guys pull back and resort to other avenues, whatever they may be.   My basic point though, is that when you raise taxes on something you discourage it;  whether or not there is a little reverse thing going on in a few cases is debateable, but for the most part a higher CG rate is going to reduce economic growth from what it might have been.
> 
> 
> A good point.  Personally I would prefer to lower the corporate income tax rate to the current average rate and eliminate most corporate tax preferences.  At first glance this is revenue neutral, but because of the distorting effects on the economy of the many credits  and deductions intended to help specific industries and groups,  I think efficiency and growth would be improved.  Such a rate would settle down to around 16%.
> 
> 
> 
> 
> 100% agree, along with reducing or eliminating the subsidies that some industries get that others don't.   Most of it goes to the biggest ones, which is probably not the original intention.   And I do think it stinks that some big corps pay nothing at all in corp taxes, and even have credit built up for future taxes.
> 
> Click to expand...
> 
> 
> Ah yes, those subsidies to big corporations.  Like oil companies?  But the dirty little secret is, no liberal is likely to vote to kill them.
> 
> Take big oil for instance that currently is receiving about $4.5 billion in subsidies.
> 
> $1+ billion of that is for the strategic petroleum reserve.
> $1 or so billion is farm fuel credits tor highway taxes on the theory that most farm equipment doesn't use those highways.
> A another big chunk goes for the low-income households fuel credits and most of the rest for green energy programs.
> The Surprising Reason That Oil Subsidies Persist: Even Liberals Love Them - Forbes
> 
> Do you really think those with high powered environmental constituencies will vote to stop subsidizing the Chevy Volt?
> 
> Oil companies and every other large corporation enjoys handsome subsidies for keeping operations in the USA and not shipping jobs overseas.
> 
> All this is to say that almost every budget item is tied up inside some program or project with a noble sounding title, whether or not it actually accomplishes anything, and any attempt to kill it evokes howls from whoever's ox is being gored.
> 
> All of which gave us the wonderful invention of baseline budgeting to ensure that nobody has to ever sacrifice a sacred cow.
Click to expand...


I was speaking about what I'd ideally like to see happen, which as you say has a very remote chance of coming true.   There are polls out today or recently that suggest the public wants spending cuts about as much as they want tax hikes on the rich.   Which is to say the majority of respondents.   But it always comes down to cutting someone else's spending rather than your own.   Can't say as I'm optimistic over real and significant cuts happening anytime soon.


----------



## Foxfyre

I appreciate that Wiseacre and I think we both know that trying to find the best solutions are not in the cards.  They will do whatever they have to do that will piss the fewest number of people off.   And while some realize that any budget solutions have to include entitlement reform, an amazing number of people want to continue entitlement funding as it is even if it means going trillions further into debt.

The fact is, America has become so dumbed down they don't know how much money a billion dollars is any more, let alone a trillion.  These are numbers they can't wrap their minds around and they are therefore meaningless.

From a recent analysis of a NBC/WSJ poll, a majority of Republicans now want their congressional leaders to compromise.  That is a major shift.

But. . . .



> Theres danger for both parties in failing to reach a deal. The NBC News/WSJ poll found that 24% of respondents will blame congressional Repubicans if there is no compromise struck, and 19% will blame Obama and congressional Democrats. But a majority56% will blame both sides equally.
> Americans want compromise in 'fiscal cliff' talks - latimes.com



According to a Fox poll released yesterday:


> Overall, 61 percent of voters say major spending cuts are necessary to reduce the deficit, while 33 percent think increasing taxes on high earners would be enough. Half of Democrats think taxing the rich is all that is needed. By contrast, majorities of Republicans (77 percent) and independents (62 percent) think cutting spending is also necessary.
> 
> Read more: Fox News poll: According to voters, spending cuts are a must | Fox News



But overwhelmingly Republicans are losing the PR war and approval ratings on this issue.  Again, most Americans don't watch Fox News or listen to conservative talk radio, and most of the rest of the media is giving the Democrats the more favorable press.  That is having an effect.


----------



## Wiseacre

Hard to believe that anybody can possibly believe that getting an additional $80 billion or so a year from the higher rates on the top 2% can fix a trillion dollar deficit.   Also hard to believe that anybody really thinks Obama and the democrats actually intend to reduce the deficit either, they just want more money to spend.


----------



## The Rabbi

Wiseacre said:


> Hard to believe that anybody can possibly believe that getting an additional $80 billion or so a year from the higher rates on the top 2% can fix a trillion dollar deficit.   Also hard to believe that anybody really thinks Obama and the democrats actually intend to reduce the deficit either, they just want more money to spend.



You are correct.  It is all political theater on the Dem side.  Because they are in permanent campaign mode.  The actual details of governing are beyond them.  Nor are they interested.  Everything is a political issue.  When they accuse the GOP of "politicizing" something, that is political too.
The Democrats are the Hamas of American politics.


----------



## PaulS1950

Can't understand or "wrap your head around" a trillion dollars then how about this:

If your income is $56000 and you borrow $28000 a year in order to spend $84000 each year and you never pay the money you borrow back but just pay interest on it; how long will it be before you can't pay the interest and go bankrupt?

For those who are mathmatically inclined and wish to calculate the answer; assume an interest rate of 2% on the loan and an increase in income of 3% per year with an increase in spending of 6% each year. (borrowing 9% more each year)
spending = S =1.06(X + Y + I)
annual income = X + .03X each year (X = 1.03X) compounded annually
debt = Y + .09Y each year (Y = 1.09Y) compounded annually
interest = I = .02Y (constant disregarding rising interest rates)


----------



## catatomic

Hi!  I just wanted to inform people that 2 million people will be left to fend for themselves in 26 weeks after we would go off the fiscal cliff.


----------



## Foxfyre

I am now convinced that President Obama WANTS us to go off the fiscal cliff.  Does anybody with a clue really think that the President of the United States would have been unable to cut some kind of deal with Congress to avoid that if he didn't want it?  Do you think the Senate would continue to be as intransigent as they have been if the Senate Democrats didn't want it?

I think they want the 'disaster' to happen because they are confident that the Republicans will be blamed.  And the GOP will then be in further disarray and will lose the House and more of the Senate in 2014.


----------



## catatomic

catatomic said:


> Hi!  I just wanted to inform people that 2 million people will be left to fend for themselves in 26 weeks after we would go off the fiscal cliff.


...unless people take care of them  (150 people would have to pay for one person)


----------



## konradv

Wiseacre said:


> Hard to believe that anybody can possibly believe that getting an additional $80 billion or so a year from the higher rates on the top 2% can fix a trillion dollar deficit.   Also hard to believe that anybody really thinks Obama and the democrats actually intend to reduce the deficit either,* they just want more money to spend.*



Isn't the Republican House there to stop that from happening?  How would that be possible, if they don't make a deal, get blamed for the result and get voted out?

The point of the extra taxation isn't to close the deficit by itself, but along with budget cuts, to show we're serious.  If it looks like we're actually trying to do something, people feel better about the direction of the country.  When people feel better, they spend more money.  When people are spending more money, new jobs get created to fill the demand.  When more people have jobs, even more money gets spent, more taxes are collected to further close the deficit and fewer social services are needed to help the unemployed, easing the strain on the budget. Win-win!


----------



## Wiseacre

konradv said:


> Wiseacre said:
> 
> 
> 
> Hard to believe that anybody can possibly believe that getting an additional $80 billion or so a year from the higher rates on the top 2% can fix a trillion dollar deficit.   Also hard to believe that anybody really thinks Obama and the democrats actually intend to reduce the deficit either,* they just want more money to spend.*
> 
> 
> 
> 
> Isn't the Republican House there to stop that from happening?  How would that be possible, if they don't make a deal, get blamed for the result and get voted out?
> 
> The point of the extra taxation isn't to close the deficit by itself, but along with budget cuts, to show we're serious.  If it looks like we're actually trying to do something, people feel better about the direction of the country.  When people feel better, they spend more money.  When people are spending more money, new jobs get created to fill the demand.  When more people have jobs, even more money gets spent, more taxes are collected to further close the deficit and fewer social services are needed to help the unemployed, easing the strain on the budget. Win-win!
Click to expand...


Higher tax rates does not show we're serious, only spending cuts will do that.   It's like all this commotion about higher taxes gets you maybe $80 billion a year in more revenue but the deficit is over a trillion dollars.   So we're making a big deal out of 8 cents on the dollar, and that ain't anywhere close to be serious.   

Nice scenario you paint, let's hope it works out that way.   But we don't need DC to be trying to do something, we need action on several fronts that will be constuctive to economic growth.   Frankly, I ain't seeing it,  I'm seeing a lot of new regulations coming down the road, and real soon.   I'm seeing the president about to use the EPA to choke off fracking for natural gas, and implementing new auto guidelines for gasoline mileage that will make cars a few thousand dollars more expensive than they are now.   I'm seeing new rules for ObamaCare and Dodd-Frank going into effect that raise the cost of compliance and cut into full time job creation.   What I see are policies that impede economic growth rather than fostering it.


----------



## PaulS1950

The leading economists and the Wall Street Journal all seem to agree that the USA is headed for another, deeper, recession than we are in now that will hit in 2013.
I hope you are ready for it. 
Stage 1. distraction
Stage 2. disruption
Stage 3. destruction
Stage 4. domination


----------



## Foxfyre

PaulS1950 said:


> The leading economists and the Wall Street Journal all seem to agree that the USA is headed for another, deeper, recession than we are in now that will hit in 2013.
> I hope you are ready for it.
> Stage 1. distraction
> Stage 2. disruption
> Stage 3. destruction
> Stage 4. domination



I honestly don't see how it can be avoided.  I just posted a new thread (in Politics) re the 10 worst regulations of 2012, and there will be hundreds if not thousands of new ones going on the books for Obamacare alone.   Every single one of them costs us something in some way.

Obama is quite confident that he'll come out of any economic collapse unscathed, despite the fact he has not been willing to negotiate in good faith and he and the Democrats have been unwilling to address any spending cuts of any kind in any serious way.  He has the media in his corner who will be quite accommodating in keeping the impression alive that the only gridlock is the fault of the Republicans.


----------



## midcan5

It's hard to understand how ideas that are so counterintuitive given our history have gained such a following. Well, not really hard if you've read 'Invisible Hands' by Kim Phillips-Fein, few people question where their ideas come from and the mind once it accepts some pattern of thought usually stays there.

The idea that concentrated wealth creates jobs and opportunity makes no sense, demand creates jobs and jobs require work. How many who complain about the economy buy American made? Does anyone really believe that the rich gave lots of money to Romney because they wanted to create jobs and somehow or another Romney would help by concentrating more wealth in the hands of the few? 

America's best years were when taxes were the highest and America was building the infrastructure and educational facilities that made the country the wealthiest on earth. The rich did not create that, FDR and Eisenhower among many others did. Wealth is not created in a vacuum and if you took any wealthy person and placed them on an empty island they'd be lucky if they survived. The worship of the rich and money is a misplaced value in America today.

But the myths continue and big money supported organizations like Cato are a major purveyor of the myths. Consider how many of these so called experts predicted the crash of 2008 as an example of how little they all know. A few educational links: 

Oh and austerity programs are hurting Europe not helping. http://www.nytimes.com/2012/02/19/magazine/the-way-greeks-live-now.html


*"There is no historical evidence that tax cuts spur economic growth. The highest period of growth in U.S. history (1933-1973) also saw its highest tax rates on the rich: 70 to 91 percent. During this period, the general tax rate climbed as well, but it reached a plateau in 1969, and growth slowed down five years later. Almost all rich nations have higher general taxes than the U.S., and they are growing faster as well."* Tax cuts spur economic growth

The Idolatry of Ideology-Why Tax Cuts Hurt the Economy by Russ Beaton

Spending Cuts Vs. Tax Increases at the State Level, 10/30/01

The rich get rich because of their merit.

http://www.usmessageboard.com/education/126617-reagan-and-taxes.html

"The history of the twentieth century can be summarized--excessively briefly--in five propositions: First, that the history of the twentieth century was overwhelmingly economic history. Second, that the twentieth century saw the material wealth of humankind explode beyond all previous imagining. Third, that because of advances in technology, productivity, and organization--and the feelings of social dislocation and disquiet that these advances generated--the twentieth century&#8217;s tyrannies were the most brutal and barbaric in history. Fourth, that the twentieth century saw the relative economic gulf between different economies grow at a rapid pace. *Fifth and last, that economic policy--the management of their economies by governments--in the twentieth century was at best inept. Little was known or learned about how to manage a market or a mixed economy.*"  J. Bradford DeLong http://econ161.berkeley.edu/TCEH/2000/TCEH_1.html


"The top 1 percent of Americans now take in roughly one-fourth of America&#8217;s total income every year. In terms of wealth rather than income,... the top 1 percent now controls 40 percent of the total. This is new. Twenty-five years ago, the corresponding figures were 12 percent and 33 percent."  Joseph Stiglitz


----------



## Wiseacre

The Roaring 20s economy was good because two repub presidents cut the tax rates after Wilson left office.   When the recession hit, Hoover raised taxes from 25% to 63%, and look what happened.   Roosevelt raised taxes during his 2nd term and the depression deepened.   The Clinton surpluses in his 2nd term didn't happen until the Gingrich-led repub Congress cut taxes in 1997.   And the Bush tax cuts in 2003 ushered in a strong period of growth up until the recession came along.   And of course my all-time fav, when Reagan cut taxes in his 1st term and fostered a 25 year period of economic boom.


The Left doesn't get it, or doesn't want to get it.   You don't tax and spend your way to prosperity.   Roosevelt tried that and so is Obama, and it don't work for the long term.   Sustained prosperity requires a strong and vibrant private sector, and high tax rates are counter producive to that.   The Left always points to the high tax rates from WWII to Reagan, as though that caused that period's growth.    The effective tax rate that people paid was quite a bit lower than that, we saw the beginning of the loopholes, tax breaks, and deductions that permeate our tax code today.   We had a huge rush of men coming home from the war, looking for work.   Many started their own businesses, it was a heck of a lot easier to do that back then than it is now.   The US economy was the only game in town, the rest of the developed world was in shambles, the cost of energy was very low and there wasn't an EPA and a ton of regulations to have to deal with.


----------



## Foxfyre

[What are 10 Facts on the Fiscal Cliff, Debt, and Spending? 



> Budget policy in 2012 was characterized by deficit spending, major increases in the national debt, and a heated debate over the &#8220;fiscal cliff.&#8221;
> 
> With just days left for President Obama and lawmakers in Congress to avert a major tax hike, sequestration, and other major policy changes, today we bring you a list of the top 10 facts on federal spending in 2012:
> 
> 1.	Four years of trillion-dollar-plus deficits. Fiscal year 2012 concluded with a $1.1 trillion deficit, marking the fourth year of trillion-dollar-plus deficits. . .at 23 percent of GDP in 2012 and on track to rise further, federal spending is growing at a dangerous pace.
> 
> 2.	National debt hit $16 trillion. On September 4. . . we owe more on the national debt than the entire U.S. economy produced in goods and services in all of 2012. . . .
> 
> 3.	The debt limit was raised by $1.2 trillion. On January 30, the federal government raised its debt limit from a staggering $15.194 trillion to an even bigger $16.394 trillion.   (We will hit that in a matter of weeks)
> 
> 4.	The $650 billion fiscal cliff distracted from the $48 trillion looming fiscal crisis. . . .As large and as major a concern as federal budget deficits are today, they stand in the shadow of $48 trillion in long-term unfunded obligations in Social Security and Medicare ($7.7 trillion more added to the debt in the next 10 years for those programs alone.)
> 
> 5.	Social Security ran a deficit for the second year in a row. According to the 2012 trustees report, Social Security spent $45 billion more in benefits in 2011 than it took in from its payroll tax. . . After adjusting for inflation, annual deficits will reach $95 billion in 2020 and $318.7 billion in 2030 before the trust fund runs out in 2033 and a 25 percent across-the-board benefit cut occurs.
> 
> 6.	Three years of spend-as-you-go policies without a federal budget.  Last budget passed was on April 29, 2009. . . .and has been on a spend whatever they want basis ever since. The House passed budget resolutions each of the past two years . . .(The Senate has refused to vote on them.)
> 
> 7.	The government spent nearly $30,000 per American household in 2012. . . (while collecting $20,293 per household in taxes.)
> 
> 8.	Obamacare will spend $1.7 trillion over 10 years. . . .(based on an updated CBO scoring). . . .Obamacare will spend $1.7 trillion over 10 years on its coverage expansion provisions alone, including a massive expansion of Medicaid and federal subsidies for the new health insurance exchanges. This means that Obamacare will increase federal health spending by 15 percent.
> 
> 9.	Social Security was the biggest federal spending program. In 1993, Social Security surpassed national defense as the largest federal spending category, and it remains first today. The top five biggest spending programs, in order, are 1) Social Security; 2) national defense; 3) Medicare; 4) Medicaid, CHIP, and other government health care; and 5) interest on the debt.
> 
> 10.	More than 40 percent of Americans are on some government program. According to Census Bureau data and Heritage Foundation calculations, 128.8 million people in America depend on a government program for basic (or not so basic) needs, such as rent, prescription drugs, and higher education.
> What are 10 Facts on the Fiscal Cliff, Debt, and Spending? - AskHeritage



Do you really think President Obama's ONLY suggestion to raise $80 billion or so by taxing the rich is going to make a difference?   Most especially if it does cost the predicted job loss and more people will then look to the government for support?


----------



## catatomic

the 20s were good because the 30s were bad


----------



## arKangel

Real solutions:
End the Fed!
End the international bankster's wars!
End all "foreign aid"

Supposedly, if democracy works, these items should be easy to accomplish.

Why not discuss those items?

Then we maybe could move on to the root of economic evil?


----------



## LibertyLemming

How's this for a take. Since we went all print money happy , really before that too, our forced taxation has been managed into debt. 

 See the quote in my signature. Disarm government and reduce the FUCK out of it.


----------



## midcan5

Wiseacre said:


> The Roaring 20s economy was good because two repub presidents cut the tax rates after Wilson left office.   When the recession hit, Hoover raised taxes from 25% to 63%, and look what happened.   Roosevelt raised taxes during his 2nd term and the depression deepened.   The Clinton surpluses in his 2nd term didn't happen until the Gingrich-led repub Congress cut taxes in 1997.   And the Bush tax cuts in 2003 ushered in a strong period of growth up until the recession came along.   And of course my all-time fav, when Reagan cut taxes in his 1st term and fostered a 25 year period of economic boom....



See what I mean: [ http://www.usmessageboard.com/clean...iscal-cliff-and-austerity-16.html#post6563484 ]  

The twenties were the same as George W. Bush's term, wild speculation, little or no regulation, and unleashed corporate power. Bubble economies don't work. It was only FDR's spending on America and the enormous spending on war that broke the depression caused by market speculation. That my friend is history and it has repeated itself. One fantastic change today is that medicare and social security kept most Americans from depths of despair Harding Coolidge and Hoover once gave America. FDR is number one for a reason.

For the historically interested see these links:

Timeline of the Great Depression
Summary 

*Oh, and Reagan raised taxes eleven or thirteen times dependent on who you read. * Newsflash: Ronald Reagan Raised Taxes | Firedoglake


----------



## Foxfyre

It is important to distinguish between different forms of taxation, however, and understand that all taxes are not equal.  It is true that Reagan did increase taxes/fees on various government services and processes, and nobody has much problem with that.  Usage fees and consumption taxes are a fair and equitable way to raise revenues and are also a very conservative way to raise revenue because only those who benefit from the services pay the taxes/fees.  Taxes on fuel, for instance, are a fair and equitable way to raise funds for highway construction and repair.  Those taxes affect only those who are using those highways or benefit from the use of the highways and are more like paying for benefits received.

Taxes applied with no other criteria than a person's success, however, or applied for no better reason than intercepting a transfer of wealth, are the most regressive of all taxes and provide the most drag on the economy in a way that negatively affects many or all.


----------



## boedicca

Foxfyre said:


> It is important to distinguish between different forms of taxation, however, and understand that all taxes are not equal.  It is true that Reagan did increase taxes/fees on various government services and processes, and nobody has much problem with that.  Usage fees and consumption taxes are a fair and equitable way to raise revenues and are also a very conservative way to raise revenue because only those who benefit from the services pay the taxes/fees.  Taxes on fuel, for instance, are a fair and equitable way to raise funds for highway construction and repair.  Those taxes affect only those who are using those highways or benefit from the use of the highways and are more like paying for benefits received.
> 
> Taxes applied with no other criteria than a person's success, however, or applied for no better reason than intercepting a transfer of wealth, are the most regressive of all taxes and provide the most drag on the economy in a way that negatively affects many or all.




The purpose of taxation is to fund the basic functions of government.   Instead, we have a byzantine system whose purpose is now to engage in transfer payments from the middle class to large corporate cronies, the permanent and expanding regulatory bureaucracy, unions, and the dependent class (who provide the votes to keep the rest in play)...with career politicians using the scheme to greatly enrich themselves.

It's a violation of RICO, imo.


----------



## Foxfyre

boedicca said:


> Foxfyre said:
> 
> 
> 
> It is important to distinguish between different forms of taxation, however, and understand that all taxes are not equal.  It is true that Reagan did increase taxes/fees on various government services and processes, and nobody has much problem with that.  Usage fees and consumption taxes are a fair and equitable way to raise revenues and are also a very conservative way to raise revenue because only those who benefit from the services pay the taxes/fees.  Taxes on fuel, for instance, are a fair and equitable way to raise funds for highway construction and repair.  Those taxes affect only those who are using those highways or benefit from the use of the highways and are more like paying for benefits received.
> 
> Taxes applied with no other criteria than a person's success, however, or applied for no better reason than intercepting a transfer of wealth, are the most regressive of all taxes and provide the most drag on the economy in a way that negatively affects many or all.
> 
> 
> 
> 
> 
> The purpose of taxation is to fund the basic functions of government.   Instead, we have a byzantine system whose purpose is now to engage in transfer payments from the middle class to large corporate cronies, the permanent and expanding regulatory bureaucracy, unions, and the dependent class (who provide the votes to keep the rest in play)...with career politicians using the scheme to greatly enrich themselves.
> 
> It's a violation of RICO, imo.
Click to expand...


Or if it isn't, it should be.  It should never be the function or within the power of government to forcibly take property  belonging to one citizen who lawfully earned it and give it to another citizen who didn't.  Once we accept such as the normal function of government, none of us own anything or earn anything.  We have only what the government deems appropriate for us to have for the time being.


----------



## Foxfyre

Well the Senate cut a deal in the wee hours of the morning with Mitch McConnell and Joe Biden being the adults in the room and Harry Reid going along with it probably because he just wanted to go to bed.   So what did we get?  The can was kicked down the road a bit for the most serious tax issues and spending cuts that would have been affected by going over the fiscal cliff.  Taxes will be raised on those earning $400k or more.  And, in the Senate version, we taxpayers will see a (delayed) $1 in spending cuts in return for every $41 in immediate new taxes imposed.  They just ignored the issue of us hitting the debt ceiling again and they didn't deal with that.

So who won?  President Obama.  He says he didn't get everything he wanted, but will agree to the Senate deal.  Democrats, however, are saying that the objective was to crush the GOP resolve to stand firm on taxes, however, and therefore this was a Democrat/Obama victory in a major way.  The GOP now has to face its constituents/supporters/contributors to whom it pledged no income tax increases.  Will there be hell to pay?  Too soon to say.

And how will the House deal with it today?


----------



## Rozman

A fair deal...get it Libs fair would have been for what we did on revenue and if we got some sort of
cuts in spending.

So taxes are raised and the Democrats don't give up anything?.....

It always seems to be raise taxes and sometime we will get spending cuts...

This is a disgrace.


----------



## Foxfyre

Rozman said:


> A fair deal...get it Libs fair would have been for what we did on revenue and if we got some sort of
> cuts in spending.
> 
> So taxes are raised and the Democrats don't give up anything?.....
> 
> It always seems to be raise taxes and sometime we will get spending cuts...
> 
> This is a disgrace.



Of course it is, but they don't care.  They got what they wanted.  They can claim victory that they raised taxes on those eeeeeeevil, greedy, selfish rich people and therefore they did their job.  And as long as folks get their government goodies, why should they worry their little empty heads about national solvency?  They figure we'll survive long enough that they will get all of theirs.  And they've been brainwashed that all those who get hurt deserve that.

It's a win-win-win for the Democrats.  If the House nixes the deal, its the terrible, selfish, all-for-the-rich Republicans who get the blame for any government failure.  If the House agrees to the deal, they are the ones who caved and backstabbed the people who elected them.

Yep.  Win-win-win for the Democrats any way you look at it.


----------



## Wiseacre

One would hope that with the fiscal cliff deal behind us, the democrats will stop whining about more taxes, and instead focus on spending cuts.   Yeah, right.


----------



## Trajan

midcan5 said:


> Wiseacre said:
> 
> 
> 
> The Roaring 20s economy was good because two repub presidents cut the tax rates after Wilson left office.   When the recession hit, Hoover raised taxes from 25% to 63%, and look what happened.   Roosevelt raised taxes during his 2nd term and the depression deepened.   The Clinton surpluses in his 2nd term didn't happen until the Gingrich-led repub Congress cut taxes in 1997.   And the Bush tax cuts in 2003 ushered in a strong period of growth up until the recession came along.   And of course my all-time fav, when Reagan cut taxes in his 1st term and fostered a 25 year period of economic boom....
> 
> 
> 
> 
> See what I mean: [ http://www.usmessageboard.com/clean...iscal-cliff-and-austerity-16.html#post6563484 ]
> 
> The twenties were the same as George W. Bush's term, wild speculation, little or no regulation, and unleashed corporate power. Bubble economies don't work.* It was only FDR's spending on America and the enormous spending on war *that broke the depression caused by market speculation. That my friend is history and it has repeated itself. One fantastic change today is that medicare and social security kept most Americans from depths of despair Harding Coolidge and Hoover once gave America. FDR is number one for a reason.
> 
> For the historically interested see these links:
> 
> Timeline of the Great Depression
> Summary
> 
> *Oh, and Reagan raised taxes eleven or thirteen times dependent on who you read. * Newsflash: Ronald Reagan Raised Taxes | Firedoglake
Click to expand...




> It was only FDR's spending on America and the enormous spending on war ..



For the historically interested see this-


No, gentlemen, we have tried spending money. We are spending more than we have ever spent before and it does not work. .."We have tried spending money. We are spending more than we have ever spent before and it does not work....After eight years of this administration we have just as much unemployment as when we started...and an enormous debt to boot! I say after eight years of this Administration we have just as much unemployment as when we started.  U.S. Treasury Secretary Henry Morgenthau, Jr.


U.S. Treasury Secretary Henry Morgenthau, Jr., in a private meeting at the Treasury Department, May 9, 1939. Morgenthau was lamenting the fact that government deficit spending didn't have the intended effect (reducing unemployment). 

Henry Morgenthau, Jr. - Wikipedia, the free encyclopedia.


----------



## Trajan

Wiseacre said:


> One would hope that with the fiscal cliff deal behind us, the democrats will stop whining about more taxes, and instead focus on spending cuts.   Yeah, right.



that $60 Bn or so they will yield from this deal ala the 450k benchmark, will be vaporized anyway for the year, in the pork laden Sandy bill. In addition they will get less than that $60Bn next year and there after,  as those folks getting hit change their investment behavior etc.  

Maryland tried it, Illinois tried it, Great Britain, its a road to no where. 

I know Boehner was behind the 8-ball, but there is no net spending drop, therefore its a travesty imho.


----------



## Wiseacre

Trajan said:


> Wiseacre said:
> 
> 
> 
> One would hope that with the fiscal cliff deal behind us, the democrats will stop whining about more taxes, and instead focus on spending cuts.   Yeah, right.
> 
> 
> 
> 
> that $60 Bn or so they will yield from this deal ala the 450k benchmark, will be vaporized anyway for the year, in the pork laden Sandy bill. In addition they will get less than that $60Bn next year and there after,  as those folks getting hit change their investment behavior etc.
> 
> Maryland tried it, Illinois tried it, Great Britain, its a road to no where.
> 
> I know Boehner was behind the 8-ball, but there is no net spending drop, therefore its a travesty imho.
Click to expand...



The way I look at it, the Bush Tax Cuts already expired on 31 Dec.   What the House did was restore the tax cuts for as many people as possible;   they just weren't going to get more than what they got on the tax side.   IMHO, it's just as well to get the tax issue off the table and get to the debt ceiling where they can work for real spending cuts.   That's where they have more leverage, polls show more than half the public wants less gov't spending.   I don't think the GOP will fold on this, but we'll see.   And if the country goes into a recession this year or next, the repubs can put the blame on the dems and their tax and spend policies.


----------



## saveliberty

The Democrat's out on this are accounting tricks which will show huge spending cuts post 2016.


----------



## Foxfyre

Wiseacre said:


> Trajan said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> One would hope that with the fiscal cliff deal behind us, the democrats will stop whining about more taxes, and instead focus on spending cuts.   Yeah, right.
> 
> 
> 
> 
> that $60 Bn or so they will yield from this deal ala the 450k benchmark, will be vaporized anyway for the year, in the pork laden Sandy bill. In addition they will get less than that $60Bn next year and there after,  as those folks getting hit change their investment behavior etc.
> 
> Maryland tried it, Illinois tried it, Great Britain, its a road to no where.
> 
> I know Boehner was behind the 8-ball, but there is no net spending drop, therefore its a travesty imho.
> 
> Click to expand...
> 
> 
> 
> The way I look at it, the Bush Tax Cuts already expired on 31 Dec.   What the House did was restore the tax cuts for as many people as possible;   they just weren't going to get more than what they got on the tax side.   IMHO, it's just as well to get the tax issue off the table and get to the debt ceiling where they can work for real spending cuts.   That's where they have more leverage, polls show more than half the public wants less gov't spending.   I don't think the GOP will fold on this, but we'll see.   And if the country goes into a recession this year or next, the repubs can put the blame on the dems and their tax and spend policies.
Click to expand...


You really think the Democrats will get the blame?  So far they haven't gotten the blame for anything in the last six years though they have held most of the cards for that period.   The media is not going to tell it like it is.

Some important things happened this past weekend and little or nothing of that is being prominently reported in the mainstream media.  A lot of important things that should have happened and didn't are also not being prominently reported by the mainstream media.

What is leading the headlines, the photo ops, the lead paragraphs?  It is Boehner saying "F*** you" (twice) to Harry Reid.  You have to really dig to find out that this was in response to Reid calling Boehner a dictator and other uncomplimentary terms.

And such is the intellect of today's media and apparently most of those voting for our elected leadership these days.


----------



## Wiseacre

Foxfyre said:


> Wiseacre said:
> 
> 
> 
> 
> 
> Trajan said:
> 
> 
> 
> that $60 Bn or so they will yield from this deal ala the 450k benchmark, will be vaporized anyway for the year, in the pork laden Sandy bill. In addition they will get less than that $60Bn next year and there after,  as those folks getting hit change their investment behavior etc.
> 
> Maryland tried it, Illinois tried it, Great Britain, its a road to no where.
> 
> I know Boehner was behind the 8-ball, but there is no net spending drop, therefore its a travesty imho.
> 
> 
> 
> 
> 
> The way I look at it, the Bush Tax Cuts already expired on 31 Dec.   What the House did was restore the tax cuts for as many people as possible;   they just weren't going to get more than what they got on the tax side.   IMHO, it's just as well to get the tax issue off the table and get to the debt ceiling where they can work for real spending cuts.   That's where they have more leverage, polls show more than half the public wants less gov't spending.   I don't think the GOP will fold on this, but we'll see.   And if the country goes into a recession this year or next, the repubs can put the blame on the dems and their tax and spend policies.
> 
> Click to expand...
> 
> 
> You really think the Democrats will get the blame?  So far they haven't gotten the blame for anything in the last six years though they have held most of the cards for that period.   The media is not going to tell it like it is.
> 
> Some important things happened this past weekend and little or nothing of that is being prominently reported in the mainstream media.  A lot of important things that should have happened and didn't are also not being prominently reported by the mainstream media.
> 
> What is leading the headlines, the photo ops, the lead paragraphs?  It is Boehner saying "F*** you" (twice) to Harry Reid.  You have to really dig to find out that this was in response to Reid calling Boehner a dictator and other uncomplimentary terms.
> 
> And such is the intellect of today's media and apparently most of those voting for our elected leadership these days.
Click to expand...



I think it will be very easy for the repubs to say we gave them their tax hikes on the rich but they wouldn't cut spending.   That is a winner in the red states, and maybe also in some purple states if the economy isn't any better.


----------



## Foxfyre

Wiseacre said:


> Foxfyre said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> The way I look at it, the Bush Tax Cuts already expired on 31 Dec.   What the House did was restore the tax cuts for as many people as possible;   they just weren't going to get more than what they got on the tax side.   IMHO, it's just as well to get the tax issue off the table and get to the debt ceiling where they can work for real spending cuts.   That's where they have more leverage, polls show more than half the public wants less gov't spending.   I don't think the GOP will fold on this, but we'll see.   And if the country goes into a recession this year or next, the repubs can put the blame on the dems and their tax and spend policies.
> 
> 
> 
> 
> You really think the Democrats will get the blame?  So far they haven't gotten the blame for anything in the last six years though they have held most of the cards for that period.   The media is not going to tell it like it is.
> 
> Some important things happened this past weekend and little or nothing of that is being prominently reported in the mainstream media.  A lot of important things that should have happened and didn't are also not being prominently reported by the mainstream media.
> 
> What is leading the headlines, the photo ops, the lead paragraphs?  It is Boehner saying "F*** you" (twice) to Harry Reid.  You have to really dig to find out that this was in response to Reid calling Boehner a dictator and other uncomplimentary terms.
> 
> And such is the intellect of today's media and apparently most of those voting for our elected leadership these days.
> 
> Click to expand...
> 
> 
> 
> I think it will be very easy for the repubs to say we gave them their tax hikes on the rich but they wouldn't cut spending.   That is a winner in the red states, and maybe also in some purple states if the economy isn't any better.
Click to expand...


Yes, well I hope you're right.  I really do.  But I lost a bet on a good steak dinner that Obama could not be re-elected in the crappy economy we have endured for four years.  But I was wrong.  And I am now convinced the media can convince the gullible and willing of anything in the world it wants to convince them of.

Do you really think that all those people who voted for Obama want a crappy economy?  8+% unemployment into perpetuity?  Want the nation to be financially insolvent?   Want an unimiginable number of mortgages to be underwater?  Want trillion dollar deficits as far as the eye can see?   Want more than 50% of the population on some kind of government dole?

I don't believe that most of them want that.

But the media was able to convince them that it was the Republicans fault that things are as bad as they are and that the Republicans would continue the misery plus take away what government benefits those same people are receiving.

So I'm not holding my breath that reality and honest assessment of the facts will prevail in the next two years either.


----------



## derk

Foxfyre said:


> Wiseacre said:
> 
> 
> 
> 
> 
> Foxfyre said:
> 
> 
> 
> You really think the Democrats will get the blame?  So far they haven't gotten the blame for anything in the last six years though they have held most of the cards for that period.   The media is not going to tell it like it is.
> 
> Some important things happened this past weekend and little or nothing of that is being prominently reported in the mainstream media.  A lot of important things that should have happened and didn't are also not being prominently reported by the mainstream media.
> 
> What is leading the headlines, the photo ops, the lead paragraphs?  It is Boehner saying "F*** you" (twice) to Harry Reid.  You have to really dig to find out that this was in response to Reid calling Boehner a dictator and other uncomplimentary terms.
> 
> And such is the intellect of today's media and apparently most of those voting for our elected leadership these days.
> 
> 
> 
> 
> 
> I think it will be very easy for the repubs to say we gave them their tax hikes on the rich but they wouldn't cut spending.   That is a winner in the red states, and maybe also in some purple states if the economy isn't any better.
> 
> Click to expand...
> 
> 
> Yes, well I hope you're right.  I really do.  But I lost a bet on a good steak dinner that Obama could not be re-elected in the crappy economy we have endured for four years.  But I was wrong.  And I am now convinced the media can convince the gullible and willing of anything in the world it wants to convince them of.
> 
> Do you really think that all those people who voted for Obama want a crappy economy?  8+% unemployment into perpetuity?  Want the nation to be financially insolvent?   Want an unimiginable number of mortgages to be underwater?  Want trillion dollar deficits as far as the eye can see?   Want more than 50% of the population on some kind of government dole?
> 
> I don't believe that most of them want that.
> 
> But the media was able to convince them that it was the Republicans fault that things are as bad as they are and that the Republicans would continue the misery plus take away what government benefits those same people are receiving.
> 
> So I'm not holding my breath that reality and honest assessment of the facts will prevail in the next two years either.
Click to expand...


What has happened is that people keep enabling the two partys. Essentially they are different sides of the same coin. Even when the Republicans win they fail to give us less government. They are exactly like the democrats, growing government and protecting their party. Most people have become disillusioned, because they never seem able to enact reforms and STOP the Behemoth from devouring our liberty's.

The issue most of us see now is that its the political system thats needing changed, not just the two partying politickers


----------



## saveliberty

Austerity is the only option, if Obama insists on avoiding spending cuts and pushing debt ceiling increases.


----------



## Foxfyre

derk said:


> Foxfyre said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> I think it will be very easy for the repubs to say we gave them their tax hikes on the rich but they wouldn't cut spending.   That is a winner in the red states, and maybe also in some purple states if the economy isn't any better.
> 
> 
> 
> 
> Yes, well I hope you're right.  I really do.  But I lost a bet on a good steak dinner that Obama could not be re-elected in the crappy economy we have endured for four years.  But I was wrong.  And I am now convinced the media can convince the gullible and willing of anything in the world it wants to convince them of.
> 
> Do you really think that all those people who voted for Obama want a crappy economy?  8+% unemployment into perpetuity?  Want the nation to be financially insolvent?   Want an unimiginable number of mortgages to be underwater?  Want trillion dollar deficits as far as the eye can see?   Want more than 50% of the population on some kind of government dole?
> 
> I don't believe that most of them want that.
> 
> But the media was able to convince them that it was the Republicans fault that things are as bad as they are and that the Republicans would continue the misery plus take away what government benefits those same people are receiving.
> 
> So I'm not holding my breath that reality and honest assessment of the facts will prevail in the next two years either.
> 
> Click to expand...
> 
> 
> What has happened is that people keep enabling the two partys. Essentially they are different sides of the same coin. Even when the Republicans win they fail to give us less government. They are exactly like the democrats, growing government and protecting their party. Most people have become disillusioned, because they never seem able to enact reforms and STOP the Behemoth from devouring our liberty's.
> 
> The issue most of us see now is that its the political system thats needing changed, not just the two partying politickers
Click to expand...


There is much truth to that.  They all talk a great game, but at the end of the day most are going to vote for whatever will keep them in power and increase their prestige, influence, and personal fortunes.  But because almost all conservatives are aligned with the Republican Party--that is NOT the same thing as saying the Republican Party is conservative--the GOP reps will consider that in their votes and therefore tend to do less long term damage than the Dems.  Or at least they do it more slowly.

Here is what we are up against.  (Not making any claims for the accuracy of the numbers, but do believe the conclusion is spot on):

Source unknown:



> How stupid are we???
> 
> Look at our brilliant representatives and that great clunker buy back program.
> 
> The person who calculated this bit of information is now, and  has been a professor at the University of West Virginia in Morgantown for the last 40 some years. He says that:
> 
> &#8226; A clunker that travels 12,000 miles a year at 15 mpg uses 800 gallons of gas a year.
> 
> &#8226; A new vehicle that travels 12,000 miles a year  at 25 mpg uses 480 gallons  of gas a year.   Or if a super fuel efficient model at 35 mpg uses 343 gallons of gas a year.
> 
> &#8226; So, the average Cash for Clunkers transaction reduced gasoline consumption between 320 and 457 gallons per year.   Let's average that at 390 gallons.
> 
> &#8226; The government claims 700,000 clunkers have been replaced so that is 273 million gallons saved per year.
> 
> &#8226; That equates to a bit over 6 million barrels of oil.
> 
> &#8226; 6 million barrels is about 6 hours worth of US consumption.
> 
> &#8226; More importantly, 6 million barrels of oil at $70 per barrel costs about $420 million dollars.
> 
> &#8226; So, the government paid $3 billion of our tax dollars to save $350 million.
> 
> They spent $7.00 for every $1.00 they saved unless those new car buyers keep those vehicles for well over 7 years to compensate for the interest we will pay on that $3 billion which of course was borrowed to begin with.  And that is also assuming that the folks will drive no more miles in the new cars than they did in their clunkers.
> 
> And we still saw gasoline prices climb into the rafters and we didn't seem to reduce our dependency on foreign oil one bit.



I'm sure they are going to do much better math with Obamacare and getting those spending cuts into place though.


----------



## saveliberty

The analysis fails to note the price of used trucks went up as a result of the program as well.


----------



## Wiseacre

Foxfyre said:


> Wiseacre said:
> 
> 
> 
> 
> 
> Foxfyre said:
> 
> 
> 
> You really think the Democrats will get the blame?  So far they haven't gotten the blame for anything in the last six years though they have held most of the cards for that period.   The media is not going to tell it like it is.
> 
> Some important things happened this past weekend and little or nothing of that is being prominently reported in the mainstream media.  A lot of important things that should have happened and didn't are also not being prominently reported by the mainstream media.
> 
> What is leading the headlines, the photo ops, the lead paragraphs?  It is Boehner saying "F*** you" (twice) to Harry Reid.  You have to really dig to find out that this was in response to Reid calling Boehner a dictator and other uncomplimentary terms.
> 
> And such is the intellect of today's media and apparently most of those voting for our elected leadership these days.
> 
> 
> 
> 
> 
> I think it will be very easy for the repubs to say we gave them their tax hikes on the rich but they wouldn't cut spending.   That is a winner in the red states, and maybe also in some purple states if the economy isn't any better.
> 
> Click to expand...
> 
> 
> Yes, well I hope you're right.  I really do.  But I lost a bet on a good steak dinner that Obama could not be re-elected in the crappy economy we have endured for four years.  But I was wrong.  And I am now convinced the media can convince the gullible and willing of anything in the world it wants to convince them of.
> 
> Do you really think that all those people who voted for Obama want a crappy economy?  8+% unemployment into perpetuity?  Want the nation to be financially insolvent?   Want an unimiginable number of mortgages to be underwater?  Want trillion dollar deficits as far as the eye can see?   Want more than 50% of the population on some kind of government dole?
> 
> I don't believe that most of them want that.
> 
> But the media was able to convince them that it was the Republicans fault that things are as bad as they are and that the Republicans would continue the misery plus take away what government benefits those same people are receiving.
> 
> So I'm not holding my breath that reality and honest assessment of the facts will prevail in the next two years either.
Click to expand...


I think many of those people who votged for Obama did so because the dems did such a good job demonizing Romney, And Romney did himself no favors with several gaffes that made him look like what the dems were saying he was.   And he wasn't the greatest candidate in the world either.   IOW, Obama won more cuz of his negative campaign than he did with his own record.   Obviously.

Other thing is, and don't kid yourself about this, there are a lot of people on the dole who want to keep it that way.   Or they want a bailout/handout;  there was a story out of Detroit about a city councilwoman who said she and Detroit voted for Obama and now she expects to get a bailout from him.   The unions are the same way, as are the greenies.   And Obama will do it too, if he can find a way to get around Congress and don't think he ain't trying to do just that.

Current polls suggest that America wants less gov't spending.   Repubs need to jump all over this at every opportunity, just like the dems did over the tax hikes on the wealthy.   They made the repubs bite the bullet, and it is now time to return the favor.   What goes around comes around.


----------



## Foxfyre

Wiseacre said:


> Foxfyre said:
> 
> 
> 
> 
> 
> Wiseacre said:
> 
> 
> 
> I think it will be very easy for the repubs to say we gave them their tax hikes on the rich but they wouldn't cut spending.   That is a winner in the red states, and maybe also in some purple states if the economy isn't any better.
> 
> 
> 
> 
> Yes, well I hope you're right.  I really do.  But I lost a bet on a good steak dinner that Obama could not be re-elected in the crappy economy we have endured for four years.  But I was wrong.  And I am now convinced the media can convince the gullible and willing of anything in the world it wants to convince them of.
> 
> Do you really think that all those people who voted for Obama want a crappy economy?  8+% unemployment into perpetuity?  Want the nation to be financially insolvent?   Want an unimiginable number of mortgages to be underwater?  Want trillion dollar deficits as far as the eye can see?   Want more than 50% of the population on some kind of government dole?
> 
> I don't believe that most of them want that.
> 
> But the media was able to convince them that it was the Republicans fault that things are as bad as they are and that the Republicans would continue the misery plus take away what government benefits those same people are receiving.
> 
> So I'm not holding my breath that reality and honest assessment of the facts will prevail in the next two years either.
> 
> Click to expand...
> 
> 
> I think many of those people who votged for Obama did so because the dems did such a good job demonizing Romney, And Romney did himself no favors with several gaffes that made him look like what the dems were saying he was.   And he wasn't the greatest candidate in the world either.   IOW, Obama won more cuz of his negative campaign than he did with his own record.   Obviously.
> 
> Other thing is, and don't kid yourself about this, there are a lot of people on the dole who want to keep it that way.   Or they want a bailout/handout;  there was a story out of Detroit about a city councilwoman who said she and Detroit voted for Obama and now she expects to get a bailout from him.   The unions are the same way, as are the greenies.   And Obama will do it too, if he can find a way to get around Congress and don't think he ain't trying to do just that.
> 
> Current polls suggest that America wants less gov't spending.   Repubs need to jump all over this at every opportunity, just like the dems did over the tax hikes on the wealthy.   They made the repubs bite the bullet, and it is now time to return the favor.   What goes around comes around.
Click to expand...


But I think you either didn't hear all I tried to say, or more likely I just said it badly.  

I agree that those the government has made dependent, even just a little bit, are not eager to give up whatever freebies/benefits they are getting.  So yes that is part of it and it is in conflict with their convictions, shared by us, about what is wrong with government.  We no longer have as much of a self-sacrficing, do it for the good of the country population as we had in an earlier time.  And too often it is looking to the other guy, and not ourselves, to tighten his/her belt and take one for the team.

But I'm not buying that Romney is one who blew it.  Okay he missed some great opportunities to deliver punches, but so did Obama.  Okay he made some gaffes, but so did Obama.  The difference is in how the media protrayed Romney's missed opportunities and gaffes.  The last analysis I saw, the media coverage was something like 11 to 1 negative coverage for Romney and the GOP compared to that for Obama and the Democrats.   And THAT is why so many saw Romney as different from what he was.  And THAT is why a majority of Americans believe that all this is mostly the Republican's fault, and if the Republicans had not been the greed, obstructionist, all-for-the-rich creeps as the media has portrayed them, then Obama would have all this fixed by now.


----------



## PaulS1950

All I can say is; "Welcome to the USA (United Socialist America)."
We, as a country, avoided the fiscal "pot hole" and sped up toward the "fiscal black hole" of a bankrupt country. We are situated to increase the national debt to 20 trillion dollars by the end of Obama's second term with higher unemployment, lower GDP, and less tax income than ever before. Prices will continue to climb across the board and over 50% of the population will be on goverment support. They already are if you count unemployment as government support. We have become a socialist country and the republic is already dead.
The banning of all firearms is an absolute necessity to continue down this road and it will happen or we will have the greatest civil war that any country has ever suffered. Illinois is in the process of passing the first ban that will test what a state can get away with. They are banning all semi-auto rifles, pistols and shotguns and pump action shotguns; taxing and inspecting all public shooting ranges out of existence and requiring all gun owners to have and use "gun owner registration cards" just like so many countries have just before complete confiscation. The media and schools have been systematically educating our children that guns are bad - no guns are evil - for years. They have convinced a large population that the NRA (that was established with the help of the government to promote gun safety and civilian marksmanship) is an evil organization that buys political power to promote the evils of gun ownership.
I hope that I am wrong but with all that is going on politically, in our schools and in the media I firmly believe that the USA is going the same route as Germany, The USSR, Cuba and China. 
If I wa in charge of the GOP I would refuse to run a candidate in the next presidential election because we are in a position where we are no longer able to continue the path that more than 50% of the population wants to go without losing every last bit of the freedoms and rights that we have.
So I bid farewell to the home of the free and the land of the brave.


----------



## Foxfyre

PaulS1950 said:


> All I can say is; "Welcome to the USA (United Socialist America)."
> We, as a country, avoided the fiscal "pot hole" and sped up toward the "fiscal black hole" of a bankrupt country. We are situated to increase the national debt to 20 trillion dollars by the end of Obama's second term with higher unemployment, lower GDP, and less tax income than ever before. Prices will continue to climb across the board and over 50% of the population will be on goverment support. They already are if you count unemployment as government support. We have become a socialist country and the republic is already dead.
> The banning of all firearms is an absolute necessity to continue down this road and it will happen or we will have the greatest civil war that any country has ever suffered. Illinois is in the process of passing the first ban that will test what a state can get away with. They are banning all semi-auto rifles, pistols and shotguns and pump action shotguns; taxing and inspecting all public shooting ranges out of existence and requiring all gun owners to have and use "gun owner registration cards" just like so many countries have just before complete confiscation. The media and schools have been systematically educating our children that guns are bad - no guns are evil - for years. They have convinced a large population that the NRA (that was established with the help of the government to promote gun safety and civilian marksmanship) is an evil organization that buys political power to promote the evils of gun ownership.
> I hope that I am wrong but with all that is going on politically, in our schools and in the media I firmly believe that the USA is going the same route as Germany, The USSR, Cuba and China.
> If I wa in charge of the GOP I would refuse to run a candidate in the next presidential election because we are in a position where we are no longer able to continue the path that more than 50% of the population wants to go without losing every last bit of the freedoms and rights that we have.
> So I bid farewell to the home of the free and the land of the brave.



I can't argue that the danger for us all isn't there, Paul.  But as long as we still have our First Amendment Rights of free speech, I do believe there are enough Americans left who want an America of the strong, the brave, and the free that we can still make a difference.  But we are going to have to unify on a message and stand firm in order to do that.  We can't continue to be sidetracked by poorly understoood or defined social and/or socioeconomic issues.  We need to agree on one honest and positive message we can all stand by and support and articulate efficiently and start bringing converts to our side until it is a done deal.


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## LibertyLemming

Foxfyre said:


> PaulS1950 said:
> 
> 
> 
> All I can say is; "Welcome to the USA (United Socialist America)."
> We, as a country, avoided the fiscal "pot hole" and sped up toward the "fiscal black hole" of a bankrupt country. We are situated to increase the national debt to 20 trillion dollars by the end of Obama's second term with higher unemployment, lower GDP, and less tax income than ever before. Prices will continue to climb across the board and over 50% of the population will be on goverment support. They already are if you count unemployment as government support. We have become a socialist country and the republic is already dead.
> The banning of all firearms is an absolute necessity to continue down this road and it will happen or we will have the greatest civil war that any country has ever suffered. Illinois is in the process of passing the first ban that will test what a state can get away with. They are banning all semi-auto rifles, pistols and shotguns and pump action shotguns; taxing and inspecting all public shooting ranges out of existence and requiring all gun owners to have and use "gun owner registration cards" just like so many countries have just before complete confiscation. The media and schools have been systematically educating our children that guns are bad - no guns are evil - for years. They have convinced a large population that the NRA (that was established with the help of the government to promote gun safety and civilian marksmanship) is an evil organization that buys political power to promote the evils of gun ownership.
> I hope that I am wrong but with all that is going on politically, in our schools and in the media I firmly believe that the USA is going the same route as Germany, The USSR, Cuba and China.
> If I wa in charge of the GOP I would refuse to run a candidate in the next presidential election because we are in a position where we are no longer able to continue the path that more than 50% of the population wants to go without losing every last bit of the freedoms and rights that we have.
> So I bid farewell to the home of the free and the land of the brave.
> 
> 
> 
> 
> I can't argue that the danger for us all isn't there, Paul.  But as long as we still have our First Amendment Rights of free speech, I do believe there are enough Americans left who want an America of the strong, the brave, and the free that we can still make a difference.  But we are going to have to unify on a message and stand firm in order to do that.  We can't continue to be sidetracked by poorly understoood or defined social and/or socioeconomic issues.  We need to agree on one honest and positive message we can all stand by and support and articulate efficiently and start bringing converts to our side until it is a done deal.
Click to expand...


Speech alone will accomplish little against action, of which the government retains all control.


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## Foxfyre

We first have to understand the lies that are being used against freedom of the people and being used to promote more, bigger, more powerful government.

Such as the line that is being believed by well educated people that Obama has increased spending less during his term of office than almost any other President.

What is the simple message we can used to counter that?  Something that is easily understandable?

I use the analogy that if I spent $100 in 2008 and $200 in 2009, 2010, 2011, and 2012, I could say that I had not increased spending for three years.    I don't mention that I started with an unsustainable number to begin with and that's how the media is playing it.

http://www.heritage.org/~/media/InfoGraphics/2012/10/SRfedspendingnumbers2012p11table1_600.ashx


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## saveliberty

There is no free lunch for any people.  Americans will pay a price and the time is fast approaching.


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## LibertyLemming

saveliberty said:


> There is no free lunch for any people.  Americans will pay a price and the time is fast approaching.



True that. I'll be surprised if the dollar lasts a decade.


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## Foxfyre

In the link in my previous post you will see that the total expenditures in 2008, the last year of the Bush administration, was $3168 trillion.  And if you deduct TARP from that amount, the total would have been roughly $2,768 trillion, which was less than the year before, and the deficit in 2008 would have been roughly $87 billion.

Had that trend continued, we would have seen the deficit erased in 2009.

But in 2009 the Obama administration spent $3696 triillion
But in 2010 the Obama administration spent $3,590 trillion
But in 2011 the Obama administration spent $3,666 trillion
But in 2012 the Obama administration spent $3,563 trillion

And we have had trillion plus deficits every one of those years, more than double anything seen before including the worst of the Bush years.

Is the media pushing these grim numbers to educate the public?  Nope.  Not a peep.  Not even a whimper.  It's all the obstructionist Republicans fault so far as the media is concerned.  The Republicans did not pass that 2009 budget, however--to a man and woman they voted against it.  And we haven't had a budget in 2010, 2011, or 2012.

I am not excusing the excesses of the Republican representatives in the House and Senate either.  They still mostly vote their own selfish interests rather than the good of the country.  But you simply cannot lay all of this stuff at their feet.

And THAT is the truth.  And THAT is what we have to find a way to communicate to the people out there.


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## PaulS1950

There is only one point that can be rallied behind to prevent the demise of the USA and it is no longer important to more than half of the population:
The bill of rights.
If we were all against any limits or breaches of any of our rights then the government would have less power than they do now.
Free speach is being attacked through the one-sided media, the tapping of all information that travels the communications networks and "politically correct" verbalism.
Our right to defend ourselves is under constant attack from those who have been taught that guns are the root of all evil.
Our right to freedom from search and seizure has been virtually removed through the use of the term "social justice" and reinforced by those who say it makes us safer.
If all the first amendment people, second amendment advocates and fourth amendment folks got together we could do something but they have been driven apart because they do not voice their concern, if any, for the loss of the other rights. 
Most of those who are concerned over the loss of the second amenment show concern for the other losses too but it is rarely reciprocal.

What can be done when the police bust your door down to look for and confiscate your guns? They have the power to search your home for whatever they want and to take any "dangerous" weapons they find. The local news will only report that another cache of weapons have been removed from another criminal's home and the criminal arrested or killed in the action.


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## catatomic

"Any fool can criticize, condemn and complain - and most fools do.  But it takes character and self-control to be understanding and forgiving."

I am not calling you fools, but whether you want to focus on a good decision or good politics to get it, I suggest we stop thinking of what can't happen and start looking for what can happen.


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## Foxfyre

catatomic said:


> "Any fool can criticize, condemn and complain - and most fools do.  But it takes character and self-control to be understanding and forgiving."
> 
> I am not calling you fools, but whether you want to focus on a good decision or good politics to get it, I suggest we stop thinking of what can't happen and start looking for what can happen.



As long as the name of the game is blame and/or oneupmanship and/or making the other guys look bad, and as long as the debate avoids dealing with realities but focuses on insulting or accusing somebody, the chances of us looking for solutions are nil to none.


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## Wiseacre

Foxfyre said:


> catatomic said:
> 
> 
> 
> "Any fool can criticize, condemn and complain - and most fools do.  But it takes character and self-control to be understanding and forgiving."
> 
> I am not calling you fools, but whether you want to focus on a good decision or good politics to get it, I suggest we stop thinking of what can't happen and start looking for what can happen.
> 
> 
> 
> 
> As long as the name of the game is blame and/or oneupmanship and/or making the other guys look bad, and as long as the debate avoids dealing with realities but focuses on insulting or accusing somebody, the chances of us looking for solutions are nil to none.
Click to expand...



And the pols on both sides don't seem to be interested in long term solutions, but instead focus on the next election.


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## Foxfyre

Wiseacre said:


> Foxfyre said:
> 
> 
> 
> 
> 
> catatomic said:
> 
> 
> 
> "Any fool can criticize, condemn and complain - and most fools do.  But it takes character and self-control to be understanding and forgiving."
> 
> I am not calling you fools, but whether you want to focus on a good decision or good politics to get it, I suggest we stop thinking of what can't happen and start looking for what can happen.
> 
> 
> 
> 
> As long as the name of the game is blame and/or oneupmanship and/or making the other guys look bad, and as long as the debate avoids dealing with realities but focuses on insulting or accusing somebody, the chances of us looking for solutions are nil to none.
> 
> Click to expand...
> 
> 
> 
> And the pols on both sides don't seem to be interested in long term solutions, but instead focus on the next election.
Click to expand...


Yep.  They just kicked the can down the road.  Again.  Six weeks ago Republicans were resisting the President's offer of $10 in spending cuts (spread over a short eternity of course) for every $1 in new taxes imposed on the rich.  They opposed it because they had pledged not to raise taxes and the plan put forth gave us the taxes immediately and the spending cuts maybe sometime on down the road.

So now what have they agreed to?  $1 in spending cuts--maybe on down the road--for every $41 in new taxes that are imposed immediately.

We're screwed.


----------

