For years now we have let the left frame the narrative that the rich in this country don’t pay their fair share. Even our President has joined in this effort to demonize the very folks who are the engine of our economy, the small business owners.
“The revenue we’re talking about isn’t coming out of the pockets of middle-class families that are struggling — it’s coming out of folks who are doing extraordinarily well and who are enjoying the lowest tax rates since before I was born. If you’re a — if you are a wealthy CEO or a … hedge fund manager in America right now, your taxes are lower than they have ever been. They’re lower than they’ve been since the 1950s.” – President Obama, June 29, 2011.
So a wealthy CEO or a hedge fund manager are making too much money and not paying enough.
Really?
For the honest answer to that question, let us turn to an organization that isn’t always very friendly to the United States, even though it was formed, in part by the US.
The Organization for Economic Cooperation and Development (OECD) is an intergovernmental economic organization in which the 30 member countries discuss, develop and analyze economic and social policy. While all of the member countries are considered to be economically advanced and collectively produce two-thirds of the world’s goods and services, membership is limited only by a country’s commitment to a market economy and a pluralistic democracy.
The OECD was actually born to replace the OEEC, or the Organization for European Economic Cooperation which itself was created to administer the Marshall Plan. In 1961 the OECD was formed to takeover from the OEEC, with the emphasis being to develop strong economies in its member countries.
In a 2008 study released by the OECD, it found that America had the most progressive income tax system in the industrialized world. By looking at the richest 10% in each country, they found that America has the greatest share of personal and payroll taxes combined than in any other country in the world, for the richest 10%. In the US, the richest 10% pay a whopping 45.1% of their income in taxes; more than every other industrialized country in the world.
The next step is to see how much of the market income is earned by that top 10%. In America, they earn 33.5% of the market share of income. When you take those two figures and find the ratio of taxes to income, a surprising statistic pops out. Those evil rich people in America pay more in taxes in relation to their income than any other country, also.
No other country places that much of a burden on their top income earners, yet to hear the left – and our President – tell it, those evil rich people just need to turn over more of their income because it is only fair.
How dare we let the left frame the debate like this. We are not suffering from an income problem in this country; we are suffering from a SPENDING problem. But Obama still wants to increase taxes on small business owners, who are in many cases among the top 10% of income earners in America. This of course will only worsen the situation economically here in the US, for if the small business owners are afraid that more of their private property will be confiscated, then our economy will continue to drag along on the bottom.
Thomas Jefferson said it best –
“When the people fear their government, there is tyranny; when the government fears the people, there is liberty.”
In 1848, Karl Marx wrote the Communist Manifesto which advocated for a progressive taxation, placing higher, and oppressive, taxation on the wealthier of the state. By 1913, Wilson had put that philosophy in place. But Wilson was also a class warrior, who believed that academia was by far the most intelligent of the nation and therefore in a better position to determine was was best for those who were not.
Along comes FDR who took the class warfare philosophy to new heights. And while he instituted extremely high tax rates for the wealthy, he also stood by, quietly, while his Democrat controlled Congress created tax breaks that virtually nullified those high tax rates. That is the part of history the left will never mention. FDR also placed devout Stalinists in positions of power. Those who supported the Fascists and their way of governance.
In the process of all of this, the Democrats actually changed the defination of “poverty” and used the term “poor” to reflect those who, for whatever reason, did not achieve a level of financial security that would allow them to live well. Poor, and poverty, are not one and the same. You can be poor without living in poverty. But if you lump all the poor in with those who suffer from real poverty, you have changed the dialog.
We have no real poverty in this nation. There are no starving children, no seniors living on dog food. And yes, the dialog must be changed, but we can only do it by pointing out how the left has controlled the dialog and resorted to wordsmithing in order to foist their socialist ideals on us.
Good post, antics.
One point that is either forgotten, or never known, by liberals is that many of those high income earners who are business owners don’t even really feel the effects of higher taxes upon themselves. Tax hikes are passed off onto consumers, at least in part, to lessen the impact upon the business owner. The consumers feel those tax hikes either in higher prices, or reduced quantity and sometimes quality, as the business owner makes the adjustments necessary to reduce that “pain” of higher taxation upon themselves.
This works the same way in higher corporate taxes, as well. In the end, the consumer, of which the middle class is typically their largest group, feels the pinch of those higher taxes, and they make their own adjustments, based on their own budgets, mostly in reduced purchasing of a company’s or business’ product.
The numbers given by liberals and progressives of the “cost” to the government by the Bush tax cuts differs. One such set of numbers claims that the cuts for the highest 5% is $600 Billion over a decade, with the bottom 95% receiving $2.7 Trillion in cuts over a decade. Other places have cited a $700 Billion “cost” to the government by cuts on the top 5% of wage earners, and around $3 Trillion on the bottom 95%. If one was to use the higher figures, and include the total “cost” of the Bush tax cuts, it comes to $3.7 Trillion over ten years, or $370 Billion a year. This doesn’t even come close to the deficits piled up during Obama’s reign. And, what’s more, Obama doesn’t discuss increasing taxes on everyone, just the top 5% or so. That means that his revenues, assuming no ill effects to the economy from the tax hikes, would only bring $70 Billion or so, per year, back to the government. $70 Billion when we are talking deficits of over $1 Trillion a year over the next decade(assuming no spending cuts are made).
And the thing is, the negative effects of those tax hikes upon the economy, if enacted, are unknown, while the effect of the best case scenario, where $70 Billion more a year is brought in to the Treasury, is a pittance compared to the actual deficit.
And what actual spending cuts are the liberal/progressive Democrats talking about? You got me. I haven’t heard one specific item, with the associated dollar figure, given by them concerning any spending cuts. All I’ve heard, or read, is platitudes about “entitlement” cuts, with no clear idea what they mean by it.
@retire05:
Anyone who has spent time in the services knows this very well. For my own part, when I was in the Navy, I lived with what was considered, at the time, a wage that relegated me to the roles of the “poor”, but I was in no way, shape, or form, living in poverty.
My own son, who lives away from home now, lives on a varying wage(depending on whether he’s doing supervisor duties or not) of $8-9/hour. Yes, he is poor, but he does not live in poverty either. And, what’s more, he doesn’t think of himself as “poor”, but merely starting out in life on his own, knowing that someday, if he’s worked hard, and smart enough, that he will be able to live comfortably.
Poor and poverty are not the same thing, as you so rightly point out, but the liberal/progressives have taken over the narrative and have made these terms virtually interchangeable in the eyes of many.
I’m thinking here that somehow these self appointed elite exempt themselves from this lunacy rhetoric. Could I expect them to renounce for life their wealth and income into the redistribution pipeline without holding my breath for an overlong period of time? Lead by example? Not likely.
Obama was on TV recently saying the rich ought to be ASKED to pay more.
ASKED???
The government’s ability to separate you from your money is backed by coercion.
IF Obama wants to go it through voluntary extra contributions to our debt he can take the lead.
Didn’t he recently mention how much “Extra” money he has?
Part with it and ask your rich buddies to do the same!
On July 15th Obama said:
I am willing to take down domestic spending to the lowest percentage of our overall economy since Dwight Eisenhower.
REALLY????
That is a drop from our current 25% of GDP to only 17%.
Yet Obama has not to this date named even ONE program he is willing to cut!
All he does is threaten the seniors and the poor.
In fact Obama’s own budget (the one that couldn’t get even one vote in the Senate) held domestic spending to 24% through 2018!
@Nan G:
That is the point that conservatives ought to be hammering home on a daily basis. And to think that the MSM is spreading the idea that Obama is the only “adult in the room” during these debt ceiling discussions.
Obama only proves that socialism is never for the socialist, it is only for those the socialist deems to be less than him.
If Obama, and the rest of the wealthy left, really believed they should be paying higher taxes, there are a number of things they could do to acheive that goal; they could file simple tax returns, not taking advantage of the tax breaks and exemptions they do, they could write a check to the U.S. Treasury and say “Here is a couple of million bucks to pay down the debt.” The Treasure would gladly accept it. They could give their money away, living on only that amount that allows them to be “middle class” but you noticed, when Obama raked in millions on his book, he didn’t parcel out that money to the editors, the printers, the truck drivers who delivered his books to the stores, or the sales clerks that sold his book. He took the money and ran like a bandit in the night. While Obama touts wanting to “share the wealth” when he could, he did not share his.
Where is this OECD study?
The IRS website is pretty clear that with respect to the individual income tax, the highest earning 10% (everyone making $114,000 per year and up in Adjusted Gross Income – i.e. after 401K and health insurance premium copay deductions) make 46% of the money and pay at an average rate of 19%. See Column F, Lines 150 and 174 of the first excel table at this link.
http://www.irs.gov/taxstats/indtaxstats/article/0,,id=96679,00.html
Its tough to see where another 26% points of tax burden on income would come from with FICA taxes or other personal taxes. I’m in that top 10% group – I made $150,000 and paid $14,000 in federal taxes (Income, FICA, Medicare combined), so my total federal tax burden is under 10%.
Since we’re back to the sleight of hand distraction that envious liberals hate rich people yet again, maybe won’t hurt to post this paragraph from a recent Center for Labor Market Studies report one more time. Who knows? What it’s telling us about the increasingly rigged game that the American middle and working classes are expected to uncomplainingly participate in might eventually sink in.
Is the average American envious that he or she cannot possess this? I imagine not. Nor would the average person likely think anyone who can afford it is evil. Though the price tag might make a lot of people wonder if the richest among us might not have a few screws loose. (It is quite a nice item, as plastic fountain pens go. If that one doesn’t suit your tastes, there are plenty of high-end alternatives available.)
I would hazard a guess that an increasing level of consumption of such items at the top probably isn’t going to create many jobs or do much to stimulate economic growth. As an ever larger share of the wealth continues to concentrate at the top, working and middle class consumers have an ever smaller share with which to consume, and it’s their consumption of the goods and services produced by the U.S. economy that turns the economy’s wheels. That’s one of the serious unmentioned dangers in the trend that the Center for Labor Market Studies report reveals.
I was a Dem when O ran….I changed to Rep when I saw a man running that had no experience, $$$ backing w press support and my red flags immediately went on alert. The deluge of bs crap was indeed overwhelming and my choice was confirmed during his campaign time after time. The first time I saw him pre-election with others on a stage while our anthem played and he dressed way too casually and didnt place his hand over his heart (the others did) as he stood there in disrespect, I knew this man was a liar/fraud/cheat/pig! He knows full well that even if the rich were taxed 100% it wouldnt solve the problems he has added too financially…They all know…and yet…he/they continue on a path that will surely bring the US into quite a dilemma. He has before him now a bill that can stave off many financial woes…and yet…he ONCE AGAIN threatens! This is not the mark of a US Pres…it is the mark of a failed one. God bless the USA….whaps O with my flipflop and pulls his ears back to whence he came!
also, the fact that the poors, if he has a job that give him lower salary, no union’s fee,
but an signature to have his job secure for a renewable 10 years certainty, providing he stand to his own promises to deliver a nd give the best of his knowledge along with the acquired knowledge along the time , providing he is dedicated to his companie only and never divulge the secrets of it policy.
THEN THE REAL VALUE OF HIS SECURE JOB HAS ASECURITY FOR HIM OR HER TO IMPROVE HIS PERSONAL LIVING STANDARD BY TAKING THE WORRY OUT OF THE WHAT IF, AND THEN HE COULD HAVE AN ADDED POWER OF CREDIT OPEN TO SETTLE HIS FAMILY PRESENT NEED WITH HIS
FEELING OF SECURITY,
SO JUST TO SAY THAT BUSYNESSES ARE AN TOP FACTOR TO GET UNEMPLOYEMENT DECREASE
IN A SOCIETY, AND MORE OF, TO HELP THEIR CHOSEN EMPLOYEE TO ENJOY A BETTER LIFE FOR THEIR FAMILY AND ALSO TO BE ABLE TO PROVIDE EMPLOYEMENT TO OTHER FOR THE SUPPLYE OF THEIR OWN ACQUIRED NEEDS WHICH THOSE WHO PROVIDE THEIR NEEDS WILL ALSO PROVIDE EMPLOYEMENT TO OTHER, AND SO ON AND THE CHAIN CONTINUE DOWN TO HELP THE POORS, AND TO THE POOREST AND TO THE POOREST OF THE POOREST, AND THE SAME ON THE UPPER TOP LEVEL WITHOUT LIMITS. SO IF THE GOVERNMENT OSTRACISE THE CREATOR OF THE TOP LADDER,
THE RESULT IS NEGATIVE TO THE POINT OF WHERE THIS DEBT CEILING IS NOW.
@Greg:
It’s hardly the “sleight of hand distraction” that claim it is. Liberal/progressives, who love to label everything, have demonized so-called “rich” people, when many of those same people are private business owners who employ the majority of American workers. Meanwhile, you bring up this;
Greg, the point of that article has nothing to do with “rich” people, but instead, corporations. And yes, many high income earners work at corporations, however, the liberal/progressives lump all of them together, making it easier to demonize them.
The American middle class is not being threatened by the corporations, Greg. They are being threatened with the uncertainty in the economy, stemming from the outrageous government spending which many feel WILL lead to higher tax rates. Just why do you think it is that corporations are not hiring? There are many factors causing this, not the least of which is that companies laid off workers during the recession and haven’t hired them back, even as demand for their products may be increasing. Many companies have been forced by that recession to become more efficient, more productivity with fewer workers, and even as the demand for their products increases, they don’t see the need to hire more workers. Is that evil? Not hardly. That is good management and business practice, particularly when the managers of those companies answer to their shareholders, who demand performance and profits.
Give those companies a reason to hire more workers, one that affects their profits positively, and they will start hiring again. The government can start with unburdening the country of Obamacare, and continue with common sense tax reform(eliminating all deductions and all tax credits and lowering the marginal tax rates to the average effective tax rates, for both individuals and corporations). Then they can start honest government program cutting, even including defense, to ease the hesitation by many businesses and corporations to spend capital on improvements and expansion. And then, on top of that, close down the border to Mexico and start eliminating that draw on our society and our “piggy bank”.
Short of that, nothing in the foreseeable future put forth by the Democrats will make those companies start hiring again.
@johngalt, #12:
The rich becoming still richer is not going to increase the consumption of goods and services by a working and middle class majority that have been increasingly feeling the economic squeeze.
Increased high-end taxes is one way of moving wealth back down into the system. It’s basically the government’s only response.
An alternative would be for the working and middle classes to be paid more for their part in the production of the nation’s goods and services. That would allow them to consume more of those things–the economic equivalent of a positive feedback loop–and would also allow them to save and invest more toward their own future needs. Unfortunately, the push from those who want low high-end taxes has also been for cheaper labor–for generally reduced wages and benefits, and for fewer workers doing the same or an increased volume of work. If that can be done even more cheaply by foreign workers in an unregulated environment, you move production overseas. Overseas workers don’t spend their wages in the U.S. economy, compounding the negative effect.
If it’s the wealthiest who produce all of the jobs and economic activity, I’m not entirely sure that the results we’ve been seeing lately warrant the ever-increasing shares they’ve been receiving.
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@Greg:
What you are proposing is trickle down poverty. And completely against any ecomonic philosophy, including Keynes.
How does increasing taxation on the high end create jobs? Money is not static, it only produces more when it is in play. You are like so many on the left who have this concept of Scrooge McDuck who sits around playing in his money all day. It doesn’t work that way. Businesses only grow when they put revenues back into the business FOR growth; perhaps a larger building that will hold more employees, a decrease in product cost to be more competitive. Any company that simply takes the profit and doesn’t use it for growth, will eventually go out of business as they are no longer competitive.
Now, let’s look at your view that employees should be paid more in order to spend more. Here is an example that shows you how wrong that mindset is: a hotel has 50 service workers that clean rooms, work in the kitchen, at the desk and in maintainence. Let’s say these workers are paid $10/hr and the room is $50/night. But give those workers just a one dollar increase in pay and the room rate must increase making it unafforable to those who could pay $50.00. When you increase the cost of production, you also increase the cost of the product, and make it less affordable to certain people.
Have you ever worked for someone who had less money than you? Have you, in fact, ever worked for a poor man? And what is your mind worth? If you design a widget, that makes the lives of millions easier and happier, and take the risk of investing your own money, or money you borrowed and will be required to pay back to put that widget into production, do you not deserve to get wealthy from that idea? And don’t you have the same opportunity to come up with an idea that will make you wealthy?
Marx had the same attitude you do. He felt that if the prolitariate owned the means of production, their lives would be better and they would be wealthier. How did that work out?
#14:
I suppose I could respond by asking how 3 decades of experiments with the repeated lowering of high-end tax rates have worked out for the average American working person. And for the nation. Is the country, as a whole, in better shape than it was before we started all of this?
It puzzles me that people don’t seem to grasp the simple fact that as blue collar and middle class Americans get poorer their consumption falls, and as their consumption falls the economy that employs them slows even further. This is a negative feedback loop. Further lowering of high-end tax rates to make the rich still richer doesn’t break such a cycle, because the rich don’t consume enough of the general assortment of goods and services to keep the wheels of the economy turning. They simply aren’t numerous enough to do so.
This isn’t a Marxist observation.
@Greg:
If higher taxes on the higher income earners and businesses was the answer, then explain why Obama, when his party controlled both Houses of Congress, did not encourage those higher taxes. After all, the Congress controls the tax rates, and the Democrats were totally in control for two years. Instead, Obama supported continuing the Bush administration tax rates.
Now, we are looking at the Democrats, who never bothered to pass a budget in 2010 due to fearing what that would do to them in the elections, are participating in class warfare to raise taxes on job producers. Even a simpleton understands that when you increase the cost of production, which is passed on to the consumer, it makes products less affordable to millions of people. Those taxes that you want raised would be part of production costs. And what is happening to the cost of goods that the middle class with the threat of increased taxes on corporations and job creators? Where is gas? Groceries? Companies are not expanding, hiring more people, because they really don’t know what the bottom line on Obamacare is going to cost them that will eat into their expansion funds and profit paid to shareholders.
I suggest you read more Hayak, Hazlitt, Sowell and Williams and less Krugman.
Because liberals and members of the msm in particular are so lacking in character themselves, they are terrible judges of character in other people, an example of which is as follows.
While disingenuously portraying G.W. Bush as an obtuse, aloof and snobby, spoiled, rich kid, liberals and especially the ones in the msm deceitfully portrayed B.H.Obama as a man of the people, when, in fact, the truth of the matter was that G.W.Bush was a humble, down-to-earth man of the people with character and with both executive and leadership experience and a genuine concern for what was in the best interests of America, and Obama was and still is just an empty suit, a street hustler and a decadent dilletante without any qualification whatsoever to be president, but who imagines himself to be royalty, which was predictable. G.W.Bush was the opposite of B.H.Obama alright, but not in the way that the liars in the msm claimed. In fact, Democrats just elected one of their own, a fool and a slimy low-life who is no better than they are, which, I suppose, makes him a man of the people alright, but only the dumbest, sleaziest and most neurotic people in our country. BTW, have you noticed that Democrats love, respect and admire liars and con artists? The slimier the better. Muslims aren’t my enemies. Democrats are my enemies. I’ll never be able to adequately express my contempt for those degenerates. They are an embodiment of all of that which is evil.
@Brian, #17:
It must be very hard work, carrying around all of that hate.
@Brian:
When he was in front of a camera, G.W. was nervous. Not because he didn’t know what he was talking about, but because he suffered from what some call “stage fright.” Many people have trouble speaking in front of large crowds, or the press when they know the press is unfriendly to begin with.
But if you were even to meet G.W. you would find him articulate and knowledgable about the subjects being discussed. And you have never heard anything about how he treated those who worked for him badly, even as governor. Because he is polite and considerate of those who work for him. I know people who cried when he left the Governor’s office because he was so great to work for.
To paraphrase Dan Aykroyd, Greg you ignorant slut
You said
“Increased high-end taxes is one way of moving wealth back down into the system. It’s basically the government’s only response.”
And how will the rich react Greg….Explain what you think they will do in reaction to say a 10% increase in personal income tax….or a 30% increase…Whatever it is that You will balance the budget?
@ Greg #18: Not a valid argument. It was pretty lame, actually.
@retireo5 #19: I have always been a [huge] G.W. fan. In fact, I have met and talked with George and Laura Bush, and Dick and Lynn Cheney, too. I campaigned for them in two elections. They are fine people. I would like to think that they won in Florida in 2000, because I initiated a telephone campaign to call only Democrats and Independents and to persuade them to vote for G.W. and for Mrs. Cheney’s little boy, Dicky.
(Which was what we did for Marco Rubio in 2008, too, the effect of which was that Rubio garnered an unprecedented 52% of the vote in a 3-way race, getting votes from Democrats, Independents and Republicans, alike.)
@Ron, #29:
I suppose it might depress the hell out of the market for $197,000 Sailor Maki-e fountain pens.
The high-end tax rates during the Clinton era didn’t seem to put the wealthy into terrible distress. They continued to get richer and to grow more numerous–although not so fast as during the GWB capitalism-on-methamphetamine era. The economy was doing well with the Clinton era tax rates. Federal deficits were steadily shrinking.
After Clinton, that situation was reversed in fairly short order. Compare what was turned over to GWB as Clinton left office with what Obama found waiting when he walked in the door.
Well, Greggie, there is where you make your mistake. You credit Clinton with the balanced budget that was passed by a Republican held Congress, and the Republicans held that Congress until January, 2007 when things started rapidly going to hell. You see, when a Democrat president has a Republican Congress that balances the budget, and passes laws that are friendly to business, you want the Democrat to take credit for it, but when a Democrat Congress spends out of control, like they did under San Fran Nan, you blame the president.
The economy was rocking along, doing quite well, until the Democrats took control of the House and Senate in January, 2007. Of course, that was due to Nancy Pelosi screaming about how bad the administration was because gas was $2.39/gallon. My, how times have changed.
Now, I understand you would like to ignore the fact that we suffered 9-11, went to war on two fronts (with a military that Clinton all but dismantled) and had two major hurricanes, as part of the reason our debt climbed under Bush. But how do you explain that under Obama, that debt has increased more in 30 months than it did all through the Bush years, and Obama has not had a major hurricane to deal with? How to you explain that unemployment under Bush averaged slightly over 5%, but under Obama it has been over 8% since he was in office just a few short months?
Raise taxes on the wealthy and I promise you, you will see a major wealth shift from the U.S. I hear Costa Rica is nice this time of year.
@retire05:
You do know that, in reality, the budget was not truly balanced under Clinton don’t you?
That was just a parlor trick that was played on the American people.
@retire05, #24:
I’ll restrict my claim to the positive effect of 8 years of more rational Clinton-era tax rates, and dispense with any argument about who gets to take credit for them. Federal deficits began their relentless climb again soon after the top-end rates were lowered–a reversal that set in long before 2007 rolled around. The rates are what made the difference in both cases–not which party raised or lowered them.
@Aye, #25:
The increase in the total national debt was certainly a whole lot less under Clinton than during the 8 years that immediately followed–6 of which were years with both a republican president and republican majorities controlling both houses of Congress. But like I said, I’ll stick to the issue of the tax rates.
@Greg: You said:
So the rich don’t spend money? They don’t go to restaurants that employ people? They don’t purchase automobiles that involve the employment of many, many folks? They don’t purchase homes? Furniture?
Once again, Greggie you are wrong.
At least you are consistent.
@Greggie: OMG, don’t ever get tired of blaming Bush??
Clinton had a GOP Congress that forced him to the middle. He LOWERED capital gains taxes and that spurred the economy.
Under Bush the economy grew, DESPITE the tragedy of 9/11.
As I continue to say, you are wrong yet again Greggie. But at least you are steadfastly consistent.
@Greg: In a free economy, people get paid for their contribution to the product or the economy. That is why quarterbacks get paid more than special team members. If other people want to get paid more, then they need to develop the skilles needed to make more money by contributing more. Fair is getting paid what one is worth. A janitor is not worth as much as the executive who guides the company to higher profits. In previous cultures, those who were not productive were left to die in the snow. Now, beggers like you want to choose your salary regardless of your contributions.
You Greg want to be a socialist or you already are. You want a free lunch for just showing up. Continuing down that path is a formula for failure. No country in history has been successful by spreading the wealth around.
@anticsrocks, #27:
Yeah, I know. Their endless quest for better fountain pens is probably keeping the entire Japanese economy afloat.
My guess is that mainstream U.S. consumers are responsible for the greater part of the demand for goods and services that provide mainstream America with jobs. As you diminish their buying power their demand for goods and services decreases, followed by the jobs related to filling that portion of the demand. That diminishes buying power even further. And so on. It’s a vicious cycle. A downward spiral. An observable fact.
@Greg:
Your ignorance of basic economics is astounding, Greg.
@Randy, #29:
Some people have skills for manipulating the economic system they find themselves in to their own advantage. What they’re best at producing is personal advantage.
Such people are going to hate Obama’s Consumer Protection Board with a passion.
@johngalt, #31:
No doubt. Apparently nothing leads one astray more quickly about the workings of the world than a combination of close observation and common sense.
@Greg: You said:
Finally you said something that has a hint of truth in in it. I have a question for you, since you are so worried about the buying power of the so-called middle class. How do higher taxes on the job creators help their situation, exactly?
@Greg:
What I mean, Greg, is that you take facts and figures about the economy, and draw conclusions from those based not on basic economic theory, or even previous business experience, but rather, on some pseudo-socialistic idea of how it should work. And none of it is correct. Not to mention your leaving out significant facts in your diatribes that run counter to the conclusions you present.
@anticsrocks, #33:
Although redistributing some portion of the wealth created by the economy back downward no doubt increases consumption, I won’t argue that they do. I’ll assume that the Clinton era tax rates might well be job-creation neutral. What they would do is increase revenue–one part of the solution to rising debt. The other part of the solution is spending cuts, which impact negatively primarily on people who are not wealthy. You can’t really sell one part to the voters without the other.
@Greg:
And just how much revenue would be raised, Greg?
Greg, if you owe $10,000.00 on a credit card and have maxed out your limit, is your debt reduced if the credit card ups your limit?
Man, you don’t even know simple Econ 101.
@johngalt, #36:
That would depend on the rate, I would think, and on where your Laffer curve turns downward. What percentage do conservatives believe that point is at? I don’t remember ever hearing. They do seem to believe there is such a point.
@retire05, #37:
The debt ceiling is a separate topic, I think. I would suggest that if the current game of chicken crashes the markets and sets interest rates climbing like a skyrocket, it might be that no one will be able to bring things back under control. We might see how the 2008 meltdown could have turned out differently. I would rather that worst case scenarios remain matters of speculation.
Greg, we take in enough revenue every month to pay the our debt, military, Social Security, Medicare/Medicaid and have $39 billion left over. So cry me a river if a few of those bureaucrats at the EPA or DoE lose a paycheck or two.
Why are people losing their jobs and Obama is giving raises to government workers?
@Greg:
Nice deflection, Greg. I asked how much revenue would be raised by increasing taxes, and I did so in relation to your discussion of Clinton-era tax rates. So, answer the question. Or, at the very least, give us your best guess.
@johngalt…#14 – You Nailed it!!… Now, could you just bottle that and serve it to the Liberals/Progressives and their not very humble “Leader” so maybe it will effervesce into their brain cells and psyche and they might finally “get it”… ??
@johngalt, #40:
Evasion seems to be the acceptable response to all such questions: What’s the Ideal Point on the Laffer Curve?
I’ll respond to your question by saying that I honestly don’t know, but I that I believe we’re presently below the point where raising taxes diminishes revenue. I would raise high-end taxes incrementally toward the Clinton era rate and adjust in accordance with the results.
GREG, geez, you activate your work here to influence here that, you also would like to get the richs
into a higher tax expanse,
dont you know by now that the richs as you call them, are people, who have already figured out the game of the GOVERNMENT, AND ARE KEEPING LOW PROFILE BUT ARE STILL WORKING TO MAKE THEIR BUSYNESS PROFITABLE, AND ARE STILL TRYING TO SAVE THEIR EMPLOYEES THE JOB THEY HIRED THEM TO DO, yes in fact they are regular AMERICANS WHO ARE MAKING THINS GO IN A SITUATION OF MANY NEGATIVES BEING DIRECTED TO THEM. I realy don’t blame them to want to decide for themself who they will help, and the GOVERNMENT ARE GOING NUT ABOUT THAT,
they would want to control the richs’s money themself, as they control the poors ,
making them believe that the government is helping them, when it is the people working and the busynesses who pay the poors, not the government
@johngalt:
$70 billion a year, per the NYT article in late 2010 re. the extension of the Bush tax cuts – wow, so only like $1.13 trillion to go!
Not to worry, Robert Reich wants to bring back the 1970s era 70% tax bracket. High-income New Yorkers and Californians will cheerfully fork over 80% of their income to government without getting discouraged, I’m sure.
Greg’s discouraged that working-class wages aren’t growing as fast as the rest of the GDP, and hence we can’t afford high levels of consumption. So corporations are shipping those jobs overseas, and the answer from the left is…what exactly? Can we devalue the dollar enough to be competitive with dollar-a-day wages in Asia? Sure, but gas will be $100/gallon, so does it really accomplish anything? I’ve heard some on the left wax poetic about the 90% tax rates in the 1950s, as if somehow those rates will bring back the good old days. The fact that the rest of the world’s industrial base was destroyed by WW2 probably wasn’t a factor, was it?
So in the end, it always comes back to simple redistribution. It’s not that those working-class wages are actually falling in real terms, they’re just falling behind the upper-middle-class. So, because everyone wants granite counter tops, flat-screen TVs, and the latest iGadget, we need high taxes to keep up consumption?
Greg, what about the fact that we consume more than we produce? Shouldn’t we have less consumption and more investment? Or do we need government to do all our “investing” for us? Investing as in padding government payrolls with good union jobs that will reliably re-elect Democrats?
Of course the examples are always corporate CEOs and hedge fund managers. Millionaires and Billionaires. Well Greg not everyone with a $200k income is a Wall Street gambler – most of them are hard-working professionals who spent a lot of years in school and actually paid attention instead of getting stoned, hard-working businessmen who took significant risks, you know, people you might actually like. So Greg if the super-rich are the target why the big hit to the upper-middle-class? Where’s your 40% or higher tax rate on $5 million incomes, you know, the ball players, rock stars, CEOs, etc.? Where’s your 1% wealth tax on fortunes greater than $100 million? I’ll know you’re serious when the wealthy liberal opinion leaders are paying up their fair share. I’m not holding my breath, Greg, because we both know that not only will they not stand for it, but there just aren’t enough of them to pay the bills even if we could somehow confiscate more of their earnings or accumulated wealth. Let’s admit the truth, these wealthy elitists really want to redistribute the earnings of the upper-middle-class to make things “more even” while retaining their own lavish lifestyles. Sorry Greg but people are beginning to see through the smoke they’re blowing.
@retire05, #39:
Money the federal government spends domestically goes back into the economy, right? It gets spent in the private sector. It’s possible that reducing that flow of cash by 40 percent overnight when the economy is in the condition it’s currently in might have some immediate and very negative consequences. They won’t necessarily be just on the government, as people like to think.
@Greg:
Yeah, yeah, yeah. But how much revenue will that generate? Forget about the damn Laffer curve already!
Here’s a hint: It’s nowhere even remotely close to the $1.3-1.6 Trillion deficit we will accumulate this year. And by “nowhere even remotely close”, I mean that it wouldn’t even make a noticeable dent in the deficit. Here’s a link that might help you find the answer;
http://money.cnn.com/2010/09/15/news/economy/bush_tax_cuts_faqs/index.htm
I’ll be back to check your math.
As an addition, even if all the Bush tax cuts were reversed back to prior tax rates, it still wouldn’t come close to the deficits for the past three years, nor would it come close to paying for the difference in revenue and spending estimated for the month of August.
@Greg:
Greg, this socialist economic claptrap you are spouting only works in fairytales and the disturbed, jealous minds of academics without economic training who are still angry they were always the last kids picked for teams in grade school.
The market will pay for the fair value of a service or good. Artificially inflating the fair value of a service or good via thuggish unionization or biased government regulations are the reasons jobs go overseas, and why we are no longer the manufacturing powerhouse we used to be. This childish envy of people who are wealthy makes as much sense as me (a middle-aged, average shape physician) being jealous of Michael Jordan for making more money for a single NBA game than I normally make in a year of providing medical care. The simple fact of the matter is that I could NEVER do what Jordan did on the court, and there are a lot more people in the world who can do what I do as a physician than people with the athletic ability of Mr. Jordan. The market values his “product” more than mine, because it is rarer. Furthermore, Mr. Jordan’s abilities provided ancillary employment to thousands of people working as cameramen, sportscasters and photographers, vendors, security personnel at the NBA stadiums, maintenance people, shoe manufacturers, accountants, electricians, and God only knows what else is involved in putting an NBA game on TV for the enjoyment of millions of people. Your socialist mentality, when taken to its logical conclusion, is that Mr. Jordan shouldn’t be paid the fair value for what he contributes…and that people like me should be jealous of his success. That’s the petty, selfish, childish hateful underpinning of socialism.
It’s simple, Greg. The federal government has absolutely no business under the framework of our Constitution for being the great big sugar daddy for the masses. When the government coerces people to pay ever increasing amounts of their hard earned money in the form of taxes, then the crony politicians use the majority of that money for no purpose other than to buy the votes of the uneducated, the lazy, the selfish, and the jealous-ridden mobs – then our great republic has transformed into nothing more than the ugly mobocracy that the class warfare pseudo-intellectuals want.
It ain’t charity if they stick a gun in your face to get your money, Greg.
I think what is lost here is the reality that Obama and his Democrat allies in Congress jacked up spending by $1 trillion annually since Obama took office, none of which was paid for by collected tax revenue. All of Obama’s extra spending over the FY2007 budget is borrowed money, every penny of it. Now many people get the point that you can’t spend more than you have and call it sustainable, even liberals understand that concept, Obama at this point has been called on it by the American people and creditors around the world. Hence the call for increased taxes by liberals. The problem for Obama is that his expectation that ALL of his deficit spending can be covered by tax increases, it can’t. Bill Whittle did a nice video which I believe many of you have seen, the truth pointed out by the video is that there ISN’T ANOTHER TRILLION left to take out of the private economy. Even if you should drive tax rates to 100% with zero deductions, there isn’t enough money to cover the ANNUAL INCREASED SPENDING.
Just because the annual GDP of the country is $15 trillion, doesn’t mean that ALL of it is profit available to be taxed. This is where liberals have a problem with economics, I have encountered some liberals who actually believe 100% of the sale price (the gross) of any good or service is profit and should be taxed as such. This is where Obama gets this faulty idea he can raise taxes indefinitely and the rich are stingy. Obama is an idiot. Profit margins for most companies is in the range of less than 10% of the gross, meaning there isn’t $15 trillion to take from the economy by the government. What’s worse, now we have people talking in terms of government spending 18 or 20% of the GDP as normal (2008), where Obama is taking over 24% of it right now. What has actually happened is that government has starved the private economy of working capital with the result we now experience. Let me put this in perspective, actual annual tax revenues are running about $4.1 trillion. That represents 27.3% of the GDP being taken by the government. Spending is running around $5.4 trillion, representing 36% of the GDP.
So where’s the $1.3 trillion borrowed coming from? Most of it is printed money from the Federal Reserve via a money laundering scheme using the banks as middle men to buy Treasury bonds with borrowed money from the Fed on the secondary market. Before this crisis most of that money was from private investors and governments with excess cash from trade deficits with the US, not anymore. In short, there is no more money to be squeezed out of the economy otherwise the Fed wouldn’t be printing money to buy US Bonds to finance the deficit spending, this is what QE1 and QE2 were really about, any other understanding or explanation is simply false. And as the Chinese have correctly publicly stated, printing money causes inflation which is a technical default of bonds because it devalues the investment. More preciously, EVERY DOLLAR printed by the Fed represents a stealth tax upon everyone because it devalues the currency. Barack Obama already got his tax increase, now he just wants to formalize it by increasing the rates you can see.
BEA GDP: http://bea.gov/national/xls/gdplev.xls
BEA government budget: http://bea.gov/national/nipaweb/TableView.asp?SelectedTable=86&FirstYear=1999&LastYear=2017&Freq=Qtr&Java=Y#mid
Making a tangential point, the $14.3 trillion national debt represents $14.3 trillion dollars of locked up capital that was diverted from job creation in the private economies of the entire world. A significant portion of the national debt is owned by foreigners. How many jobs could have been created worldwide if this money were properly invested in plant and equipment creating jobs lifting people out of poverty???? That is the real issue here, the improverishing of the world’s peoples by a spendthrift greedy self serving political elite. The effect of deficit spending by governments is to impoverish the poor and keep them down by denying them jobs. And no Greg, the rich don’t use all their money idly spending on it themselves, they invest (banks, stocks and bonds) the difference creating jobs for the rest of us, they don’t stuff their mattresses with $100 bills. The rich are thee most generous people there are, it is government that is thee most stingy and thoughtless of entities when it comes to handling money.
@Greg:
No Greg, the solution to rising federal debt is to DECREASE FEDERAL SPENDING!
What you are advocating is analogous to a family that has maxed out all their credit cards and having a debt load on those cards that exceeds their monthly income going out and getting more freaking credit cards! Why can’t you understand that? When Dad is already working 2 full-time jobs, and mom can’t afford to go to work because she either 1) can’t find a job or 2) can’t find a job that pays enough money to cover the increased expenses for child care while she works, travel expenses to get back and forth from work, and the higher tax burden for making additional pre-tax income that pushes the family into a higher tax bracket – there is no ability to make the money necessary to cover the growing debt. The only solution is to tighten the belt and learn to LIVE WITHIN ONE’S MEANS. In my little analogy, Dad can’t just go over to the well-to-do neighbor across the street and demand the neighbor give him some of his “excess” money using the excuse that the neighbor “doesn’t really need it.” That is called THEFT, Greg, and it’s a crime. It doesn’t make it any less of a crime if Dad calls his brother the cop and tells him to go take money from the neighbor.
That is EXACTLY what the socialists have been doing to us since Wilson enacted the Karl Marx-originated “progressive” income tax. Take some time to study history, Greg. How on earth is it ‘fair’ for someone to have his belongings taken from him to be used to buy the votes of those too lazy to go out and earn their own belongings? If you feel so guilty about whatever wealth you have in life, then by all means, give of your own free will to whichever charity you wish, or better yet, start your own charity! But stop trying to make me drink your class warfare kool-aid as a surrogate penance for your misplaced guilt. I’ve worked very hard to get where I am, and I know better how to prepare for my own retirement than a bunch of nincompoop socialist bureaucrats!
Ever increasing amounts? A frequently made assertion on the conservative side. Perhaps we should have a look at the historical high-end federal tax rates from about 1917 through present.
In addition to that, it’s common knowledge that on the high end the effective tax rates are in actuality even lower than the statutory rates on the tax tables. The same is true in the case of large corporations. There are all manner of deductions, shelters, loopholes, and dodges, and armies of highly-paid tax lawyers working to find every possible means of legal evasion. Closing any loopholes in connection with debt ceiling negotiations is strictly off the table, of course. That, republicans insist, would be a roundabout form of tax increase.
Middle and working class taxpayers for the most part have no such relief from statutory rates. In addition. they’re subject to a plethora of inescapable taxes and deductions that constitute a far more significant portion of their total income.
Nor are democrats the only ones who have been guilty of piling on the spending. Even in the midst of all of their current clamor about irresponsible spending, the republican House managed to quietly dodge any cuts in their own lucrative farm subsidies. The House Defense Bill had no earmarks, true to the republican pledge, right? What it had was something called the Mission Force Enhancement Transfer Fund, totaling around $1 billion. Very slick. Both republicans and democrats will benefit, although democrats took no blood oath regarding earmarks.
@Greg:
Greg, you are making my point while missing yours entirely. I am well aware of the fact that tax rates have been higher in the past, and the wealthy elitists from both parties finagled loopholes for themselves to shield as much of their income as possible from the taxman -and that the middle income folks didn’t make enough to benefit from said loopholes. That’s not a justification for raising tax rates – it’s an indictment of the inherent criminality of basing taxation on the ideology of Marx’s class warfare. We could make our economy go beyond anything we’ve ever seen by doing away with the progressive income tax and converting to either a simple federal sales tax or a straight single rate for everyone flat tax with no exemptions. The only reason these two far more equitable methods won’t be implemented is because it takes power away from our political overlords, and would require a reduction in ridiculous federal spending, which is the smokescreen used to buy the votes of the lazy and uneducated. Keynesian economics have NEVER worked. Socialism is failing all over Europe (Greece, Portugal, Ireland and now apparently Italy) because as Lady Thatcher said, “The problem with socialism is that eventually you run out of other people’s money.”
Don’t confuse me with being a republican partisan, please. I am well aware that the shenanigans happen on both sides….I puked a bit in my mouth when Gingrich did that asinine commercial on the couch with that troll Pelosi. It is conservative, constitutional republicanism in which I believe, but since there is no political party that completely professes what I believe, I have to hold my nose and vote for the least marxist SOB on the ticket.
Bottom line – you can try to play strawman arguments all you want, Greg, but you refuse to recognize the utter morale bankruptcy of using the government to steal wealth from someone who earned it to give it to someone who didn’t all for the purpose of gaining/keeping political power. Yes, we have to pay some taxes for the federal government to have the funds to do what it is constitutionally designed to do. But the federal government has no business whatsoever using tax dollars to pay for abortions or viagra, or to fund any kind of art, or to give $20 billion dollars to the Muslim Brotherhood cabal about to take control of the government of Egypt. The brilliant design of our constitutional republic is clearly laid out in “The Federalist Papers”. You might want to consider taking a good read of that book to understand why people like me have had enough of being taxed to death, and are not at all interested in giving any more money to a spoiled brat who tripled the federal deficit his first year in office, and has almost double the unemployment rate of the previous 2 presidents, and continually spouts marxist drivel when he’s reading his teleprompter.
@Babydoc:
Great answer, Babydoc.
Deficits for the last ten years:
2011 $1,500 Billion – Obama
2010 $1,300 Billion – Obama
2009 $1,400 Billion – Obama
_______________________________
Total $4,200 Billion – Obama
But….let’s blame Bush!
2008 $240 Billion- Bush
2007 $161 Billion – Bush
2006 $248 Billion – Bush
2005 $319 Billion – Bush
2004 $412 Billion – Bush
2003 $374 Billion – Bush
2002 $159 Billion – Bush
___________________________
Total $1,913 Billion – Bush
babydoc, I am all for a simpe flat tax, no exemptions, none; not for your children, your mortgage interest, not for future expenditures. None of it. A simple formula for business is that businesses make X and it cost Y to produce the product; X minus Y equals profit and that is what taxes are paid on.
Greg seems to be of the opinion that if you pay $1.00 into the federal government, a $1.00 is dumped back into the economy. But that is not true. 40 cents of that dollar lands with a big thud in D.C., never to be seen again. It’s called “administrative” costs, so perhaps it is time to get rid of some of the administrators.
People like Greg will also complain about our military costs but will never take on the costs of welfare benefits to non-productive citizens. There is a good book out that explains how the government robs us of what should legally be ours, the result of our labor and ideas: Stealing From Each Other The book is pretty heaving on economic data and kinda hard to read, but well worth your time.
Well, I guess Doug answered my question for Greg. Yes, an increase in taxes on the top 5% of wage earners, back to the Clinton-era tax rates, would only bring in around $70 Billion more a year. Compared to what the deficit is, that is a minimal, and completely useless amount. And, what’s more, the negative effect of taking that money out of the economy is unknown. It may do nothing, but then again, it may initiate a further contraction of private investment, driving unemployment higher, and resulting in no change, or lower federal revenue than before. This is why it is stupid to talk about such tax increases in relation to the federal deficit. What does that leave? Simply put, the desire to enact such a tax increase as some sort of equalization of outcome, based on envy.
And what about all of the tax credits available to the lower income earners, including those that end up giving more back to those people than they paid in taxes to begin with?
Why don’t we just remove ALL deductions, and ALL credits, from the tax code, lower rates within each bracket to the average effective tax rate, and then see what happens.
@ Greg
Nice. So the hardworking, blue-collar people you claim to champion that make those pens would face some layoffs. Now that’s the way to stick it to the rich Greg. You’re a genius!
@retire05:
It’s somewhat worse than that now, retire05. A percentage of each dollar goes towards servicing the debt, or, paying the interest on the debt, like to other countries such as China. Much of that money does not find it’s way back into our economy here, but rather, helps out those countries with their own economies, and ends up working in direct opposition to our economy.
And considering that the tax increases on the “rich” (top 5% of wage earners) would only gather $70 Billion or so a year, all of that money would go towards servicing the debt, and only a small portion would be returned back to our own economy. Not exactly the kind of wealth redistribution Greg had in mind, is it?
@johngalt:
Good point about the rich only yielding Obama about $70 billion/year in more revenues.
Most Obama supporters don’t realize Obama doesn’t mean the top 5% of earners when he says ”the rich,” he means everyone who pays taxes.
Closing the loopholes he lists (when one of his Admin actually does list a few) will hurt home owners, small businesses, two earner families and so on.
The ”rich” can always quit working or move their earnings offshore or into tax-exempt accounts.
The real meat of the money in all of Obama’s plans comes from guys like ”Joe the plumber.”
@Nan G:
Yep. And people like Greg don’t get that. They hear “rich” and think of corporate CEO’s raking in millions. What he is thinking of is the head of C-Corporations, and only the large ones, at that. As of 2003, over 5 million corporations filed tax returns, however, the overwhelming majority of those are small, such as authors and music artists, and the smaller parts of major corporations. Of the major corporations, we are only talking about a number in the 10,000′s or so, and many of those do not have CEO’s who bring in multi-million dollar salaries.
The majority of the taxes on the “rich” will, as you pointed out, affect guys like “Joe the Plumber”, an individual small business owner and most likely a Sole Proprietor, S-Corporation majority shareholders, LLC’s and others who bring in just north of $250k in taxable income. In essence, the job creators will be the ones feeling the pinch of any such tax increase.
@Nan G
How did Bush manage to only stay in office for 7 budget cycles? Didn’t Fiscal Year 2009 start in October, 2008 when he was still in office? That is his budget too.
The 12 month running deficit in March 2009 back to April 2008 was already $950 billion, and the spending level was already $3.3 trillion in 12 months. That is all pre-stimulus Bush policies. Most of the increase in the deficit since then is because of tax cuts to the payroll tax that were part of the stimulus bill.
You also do not have the right number for Fiscaly Year 2011. The current deficit through June, with three more months to go is $970 billion. Its likely another $200 billion will be added to that.
Lets make this real simple:
1993 – $1.153 trillion taxes, $1.409 trillion spending (Bush 1.0′s last budget)
2001 – $1.991 trillion taxes, $1.864 trillion spending (Clinton’s last budget)
2009 – $2.104 trillion taxes, $3.520 trillion spending (Bush 2.0′s last budget)
2011 – $2.298 trillion taxes, $5.559 trillion spending (current budget, 12 months ending June 2011)
You can’t double spending, hold taxes constant, and hope for a balanced budget to stay. Also note, where is all of Obama’s “big spending? The rate of spending by the government has been flat since June of 2009 in the range of $3.43 to $3.64 trillion. This suggests that there hasn’t been any extra spending at all.
The Republicans have no credibility on the deficit issue. Every Republican president from Nixon on has increased spending at an annual rate of 7-10% per year for their entire term in office while furiously cutting taxes. They’ve had 28 years in the White House to show us their fiscal policy and this is the results. They haven’t vetoed any spending bills of any significance. At every turn they furiously spend more money on military programs, agriculture subsidies, foreign aid, “disaster” relief, corporate subsidies, and veterans welfare programs – call it Republican Welfare, its what it really is. The simplest explanation of this is that the Republican’s who’ve won election to office wish spend our country into bankruptcy.
Andrew,
think again, these CONSERVATIVES TELL IT AS IT IS,
and no bulshit, no lies, as you will soon read for yourself, and should have read again
and what you know come from a unknown source, that you’re taking as correct,
but just do your homework, before coming and try to demolish our CONSERVATIVES.
@Andrew:
You’re right, I should not have added the 7 numbers up as if they were Bush’s entire 8 years of budgets.
I pulled stats from a ten-year tab instead of one by president.
In all fairness, however, neither the 2000-1 nor the 2001-2 budgets carried any deficits.
They were in surplus.
Here is a graph.
Should I subtract from Bush’s total deficit the amount of his surplus from the 2001-2 year?
$1,913 billion
-$128 billion
________________
$1,785 billion
retire05:
We don’t take in enough every month to pay those things. In February, March, May, July, August, October, and November, the US takes in around $150 billion per month. In January, April, June, September, and December takes in $250 billion per month thanks to quarterly and annual tax payments. Even when the budget was balanced, we ran monthly deficits in the first 7 months listed.
Come August 3, the US will have about $10 billion in the bank and will need to mail out $30 billion in Social Security checks. The borrowing limit will have been met, so $20 billion in checks will have to sit until tax money shows up to pay for them. In the meanwhile, other bills will come due, and will have to sit in the queue to await payment until tax money shows up. When the interest bills come due, it will be waiting in line along with the rest of the contractual obligations of the US Government and we will default by not making a scheduled payment on time. The alternative you suggest is that we violate other contracts or obligations with the $5 billion per day in cash available in August. I guess we can see how that holds up in court if it is even tried. Why you you think bondholders are more entitled to their interest than government employees are to their pay, or government contractors to their invoices?
@Nan G:
Bush was sworn in to office in January of 2001. Bush’s first budget was Fiscal Year 2002, starting in October 2001. The FY2002 budget ended with a $158 billion deficit. Bush’s main effect on the FY 2001 budget was his tax cut in May 2001 lowering tax receipts and thus lowering the surplus that otherwise would have occurred. You can see this in that the surplus peaked at $277 billion in April 2001, just before the tax cut started. One year later, tax receipts fell 12% and spending had risen 7%. Bush’s record is of massive spending increases and tax cuts that have held tax recipts flat since 2001. We collected the same amount of taxes in Fiscal Years 2001, 2005, and 2009. Tax receipts started, have averaged, and ended around $2.15 trillion each year for the 9 years his tax cuts have been in effect while spending was doubled. That’s why we have trillion dollar deficits.
@Ilovebeeswarzone
Are you joking? The numbers I quoted come straight off the US Treasury monthly statement of outlays and receipts. On the other hand most of what is spun out of conservative sites is straight out horsecrap.
@Andrew:
Nope. The fiscal 2009 budget was never presented to Bush for his signature.
So, you see what really happened with Obie’s supposed Immaculation present?
The 2009 budget was written almost exclusively by Dims.
The 2009 budget contained more spending than GW Bush requested.
The 2009 budget was passed by both the Senate and the House…with a “Yea” vote from then Senator Obama…but was NOT signed into law by GW Bush.
The 2009 budget was then augmented with 8% MORE spending signed into law March 11, 2009 by…wait for it…President OBAMA…via the 2009 Omnibus Appropriations Act .
All of this happened while Obie, the Dim Congress, and an eager lap-dog media machine heaps the blame on Bush.
So, nice try on trying to push 2009 off on Bush, but, your arguments are crushed under factual reality.
Aye:
The government keeps right on spending money whether there is a budget resolution or not. In the 12 months from March 2009 back to April 2008 before the 2009 Omnibus bill, the US Government spent $3.3 trillion. You do understand how this works right? There doesn’t need to be a budget for the government to spend money, and the president does not sign budget resolutions.
President Bush proposed spending $3.1 trillion in Fiscal Year 2009. Its available to see here:
http://www.gpoaccess.gov/usbudget/fy09/browse.html
Actual spending was higher than this total because of the recession that had already started increased spending on unemployment insurance and food stamps by $100 billion and of course the spending allowed by the Wall Street TARP bailout increased spending by $300 billion to bail out banks, finally more people retired and claimed Social Security and Medicare and Medicaid than budgeted, raising spending another $100 billion.
And of course, tax receipts were no where near the fantasy of $2.7 trillion Bush projected. Actual taxes collected were $2.1 trillion.
As far as stimulus goes, when you compare actual 2009 spending to what Bush proposed, you see $15 billion in extra education spending, no extra transportation spending, and $5 billion of extra disaster relief. I suppose some of the $30 billion in extra Medicaid spending is stimulus too. There isn’t any other stimulus spending to be found comparing the Bush proposal to actual spending. The numbers are all readily available on the omb.gov website – just look at the FY 2009 budget and the actual spending for FY 2009 shown in the FY 2011 budget.
So please, peruse the numbers, and see the facts for yourself. Bush doubled spending and held tax revenues constant during his 8 years in office. Thus, enormous deficits.
@Andrew:
Nope. There has to be either a budget, a continuing resolution, or some other form of spending legislation approved by Congress and signed into law by the president in order for the government to spend money. Congress doesn’t get to just spend whatever they want whenever they want.
Ummm…it’s apparent that someone doesn’t know how this whole thing works.
The House controls the purse strings ie all spending bills must originate in that chamber. Those bills are then sent to the Senate for consideration. The final reconciled version of the spending legislation is then sent to the WH for the signature of the president.
You should catch up on basic Civics 101 before you trot in here and make a fool of yourself.
Uh oh…too late.
@Aye, #67:
Yeah, right. In 2006 the debt ceiling was raised by a nearly unanimous vote of a republican Senate majority. (Only 3 republicans objected.) Senate minority democrats unanimously–and entirely symbolically–voted against it. The republican majority House didn’t even vote on raising the debt ceiling. The House majority dodged the need to take a vote that might appear inconveniently inconsistent with their fiscal responsibility pose by cleverly attaching the debt ceiling issue to the previous year’s budget. This allowed the republican Senate to handle the entire matter.
@ Aye:
Budget resolutions are non-binding joint resolutions of Congress passed to provide guidance to the Appropriation Committees in setting the actual spending levels mandated into law by Appropriation Bills. The President does not sign the Budget Resolution. The Appropriations Committees then pass bills to the chambers that set actual spending levels for various parts of the government. These bills do not have to have any relation at all to the Budget Resolution should Congress so choose. The President signs or vetoes the Appropriation Bills, not Budget Resolutions.
A Continuing Resolution is a short term Appropriation gimmick to continue government spending at current levels approved in the last Appropriation bill until new bills can be passed by both chambers.
Congress can also appropriate money outside the regular budget process as it frequently has done with funding for the Iraq and Afghan wars and for disaster relief spending.
Spending on Social Security, Medicare, Medicaid, and Debt Interest occurs under a permanent appropriation outside of the regular budget process as the levels of spending for these items are set by the choices of US Citizens under the law with respect to their retirement and the interest rates prevailing in the market place.
A budget resolution is not necessary for the US Government to spend money – only appropriation bills.
Andrew, the OECD study in 2008 is named “Growing Unequal? Income Distribution and Poverty in OECD Countries”, and was also reported on by Scott Hodge at the Tax Foundation back inOct 2008. Of course, a Dem hefty majority Congress would want to hear little of this since it is au contraire to their favored dialogue.
Since the full report is only available by subscription or purchase, perhaps showing you the table to which anticsrocks refers in the original post may give you some comparison insight.
Here’s the link to the full size table”
Now here’s the hoot… the OECD Sec’y Genera, Angel Gurría , gave a speech noting how growing inequality stifles upward mobility growth after this 2nd study on the subject.
Interesting tidbit from the “did you know?” quick excerpts from the study on the OECD source page….
Needless to say, the riots in both Greece and France in the recent past about austerity measures to reign in their fiscal woes… France also being one of the five “most equal” income nations… seems to make a laughingstock of the OECD’s generalizations. It would also be remiss *not* to point out that Greece, Mexico and the UK – where incomes became “more equal” – are also in far more serious fiscal jeopardy than Canada, Germany, Norway and the US.
True to all forms of failed socialist systems in the past, “equalizing” a society economically is a short cut to national prosperity suicide. It is only a matter of time before the system collapses upon itself, as history proves over and over. Therefore, tho the OECD Sec’y Gen spoke lofty words, even recent historic fiscal events make a mockery of his feel good assumptions just a few years ago.
The OECD agenda is quite clear with these remarks in the speech…
Nothing can be more overt than that stated agenda… a redistribute of wealth, seized by the central government, then doled out via a plethora of social welfare programs. Yeah… worked real well in Greece. And all that “equalizing” has done more for unrest and distruption of civil society than allowing those that excel to reap their rewards for doing so.
Perhaps that question is one you should be asking while standing in front of a mirror. You *do* know that the POTUS cannot appropriate/spend, and that is a Constitutional authority given only to the Congress, yes?
So what’s all this BDS nonsense? I say it’s a political red herring, and an expression that you are far more partisan than you are analytical. It’s a common affliction amongst the O’faithful.
News flash. President’s propose budgets. Those budgets can be approved, altered, or refused by an Congress in session. And the largest increase in our spending coincidently happened after Pelosi and Reid seized dangerously high power in both chambers after the 2006 midterms. Suggest you start looking at the figures you rely upon to blame this on Bush, and start putting the blame for all our fiscal woes where they actually belong… on decades and decades of Congress… the majority of which since the New Deal Era were under the control of the liberal arm of the Democrats.
Can one also assume that you are also distraught over the bogus projected GDP growth that this admin and Congress provided to the CBO in order to pass what will end up yet another entitlement program downline.. as was the stated goal by this POTUS… O’healthcare? This is your opportunity to redeem yourself with a modicum of consistency.
@Andrew:
You seem to be saying that Congress can appropriate and then spend money however they want…with or without the signature of the president.
If that’s what you’re arguing, then you’re even more lost than you first appeared to be because nothing gets spent without the signature of the president.
@Greg:
It’s really sad when you beclown yourself like this over and over again.
The House most certainly did take a vote on the debt ceiling issue…when they voted on their budget.
@MataHarley, #70:
If I’m reading the chart correctly, it shows that in the United States the top 10% have the greatest total share of market income of all nations listed, except for Italy. Of the top 10 nations listed, in Germany–arguably a nation on relatively solid fiscal footing–the top 10% have the lowest total share of national market income.
@Aye:
Yeah. The year before.
Senate Clears $781 Billion Debt Limit Increase
From the same article:
A republican president, with controlling republican majorities in both the House and Senate, as I recall…
Aye:
I said the President does not sign Budget Resolutions. He does sign Appropriation Bills. Do you even understand the difference? You are very tiresome.
@Greg:
In mid November…
It doesn’t really matter when though because by your own words, you’ve disproven your original claim that the House dodged a vote on the issue.
@ Mata Harley:
Aha! Thank you.
Above, FloppingAces writes: “In the US, the richest 10% pay a whopping 45.1% of their income in taxes”
The OECD study, which is based on IRS figures available at IRS.gov notes: “Share of taxes of the richest decile … US – 45.1%”
I.e., The percentage of total taxes paid to the government paid by the top 10% of wage earners, not the percentage of their income paid in taxes. This is such an elementary error, but it is hardly surprising that doctrinaire types would fall for the idea that the rich pay 45% of their income in taxes. As I mentioned, I am one of the rich 10%, and I pay about 9% of my income.
The reason for the percentages shown in the OECD study and the IRS studies is because total US taxation is very light compared to other countries, and it is especially light on much of the middle class and vritually nonexistant for the poor. So the rich pay a lot of what little taxes are collected in the US. Their percentage of the tax burden has increased rapidly since the mid-1990′s because of Republican tax policies which have favored the types of income earned by the wealthy (very high salaries, S-corporation income, royalties, capital gains and dividends), and exempted the middle class from much of the tax burden through the $1000 child tax credit and marginally lower bottom rates. So income for the very well off has increased rapidly, as has the number of wealthy people. Thus, lots more tax receipts from them. This is a sign of their very rapid income growth, not their oppression by high taxes.
“So what’s all this BDS nonsense? I say it’s a political red herring, and an expression that you are far more partisan than you are analytical. It’s a common affliction amongst the O’faithful.”
Hilarious. I’ve never voted Democrat in my life.
GREG, they voted on the DEBT ceiling for BUSH, is that what you mentioned?
now how much was the debt ceiling at the time?
Andrew, I say, a BUDGET RESOLUTION should be necessary to limit a PRESIDENT who is
declare to go in unreasonable spending sprees !!!
in order to protect this NATION ON THE BRINK OF DISASTER, UNTIL THE NEXT ELECTION.
@Andrew:
Interesting….
Since I was curious about how you might be able to pull off such a coup, I did some calculations to see how the numbers would come out.
For FICA and Medicare, based on an income of $150,000 your taxes would be $8796.00 More ($17K) if you’re self-employed.
I then ran some federal income tax numbers. I keyed in the $150K income number that you tossed out. I keyed in really high IRA contributions, high deductions, and a wildly high number of child dependents (5):
Strangely, even with those wildly high numbers the calculations are still much, much higher than what you’re trying to convince us that you paid:
So, why don’t you tell us all the secret to paying in approx 9% (federal income, FICA, and Medicare) on an income of $150K?
Aye:
You got the right number of kids, you got deductions and 401K stuff roughly right in total but you seem to be forgetting about pre-tax health care premiums not being taxed. Oh, and you aren’t taking advantage of capital loss harvesting in the stock acount (sell some of your losers to offset income, hold your winners), and you forgot the residential energy credit available for certain home improvements and the making Work Pay tax credit (for two). And don’t forgot about the tax free nature of certain qualified dividends now if you have the right income.
Its all about managing the bottom line and working the numbers to your advantage under the law. That is what Bush wanted us to do when he gave us this tax code.
AYE,
I think that Andrew, with the bracket he’s in, might be a LAWYER for the DEMOCRATS.
JUST by the way he is covering for them
AND by the way he brought the PRESIDENT BUSH, in his excuses for the present leadership
over spending, with nothing to show for , MAYBE IN FOREIGN COUNTRIES , BUT NOT IN THIS AMERICA
oh btw thank you,
Aye:
A Democrat lawyer? Ugh! Are you kidding me? I think you are semi-illiterate and of a wholly excessive conspiratorial bent. I am an engineer for a major engineering/construction firm.
Why are you so afraid of facts?
@Andrew:
Wow. Really?
You know, it’s kind of comical for you to accuse me of being semi-illiterate.
Especially considering that you’re right in the midst of showing everyone here your semi-illiteracy…and you’re not even smart enough to know it.
Go back and read the comment you responded to. Then, read through it again if you’re still confused.
@Andrew: You said:
You’ve got to be kidding right? I mean Obama increases spending in his first year in office by EIGHTY-FOUR PERCENT and you jump on that claiming that there is no deficit spending since the federal government has kept spending at that level.
Did your momma drop you on your head or something???
Try using REAL numbers, it actually helps and is lower in calories…
Sheesh
@Andrew: You said:
Wanna cite some references?
@Andrew: You said:
What??
So when Obama spent the following…
$787 billion stimulus package
$410 billion omnibus spending bill
$700 billion Wall Street bailout package
$3.6 trillion budget
$1.2 – $3 trillion for Obamacare
…it had NO EFFECT on the deficit?
What are you smoking?
The deficit was rapidly climbing before Obama entered the White House in January 2009. That was already the case by mid-2008. Federal revenues were already rapidly falling by that point. Rising spending plus falling revenue equals increased deficits. You don’t suddenly turn either around on a dime. Particularly when it looks as if the whole thing is coming down around your ears.
The stimulus package kept the economy from collapsing. No one thought it would return the economy to pre-2008 conditions overnight.
Republicans may demonstrate what would have happened if federal spending had been cut in 2009 by producing the same effect next month. They could effectively cut the funds flowing into a weakened economy by 40% almost overnight. If that happens, I predict that very few people will like the results.
Andrew, check on 82, I’m the one who said that you look like a lawyer for DEMOCRAT,
now why do you insult AYE because you did not read the right comment.
very much like A DEMOCRAT. WHO COME HERE TO DEBATE.
@Greggie: You said:
If you would ever pay attention, the majority of folks here at FA are not Republican shills, although there are quite a few Obama shills here, GREG.
We are upset over the way the GOP did things while they were in charge. That is, in part, what the Tea Party is all about.
GREG remember that the DEMOCRATS where a majority also at that time and like MISSY once gave a link, they where in charge of passing the bills and sneaking some of them insides to pass it,
so where did that majority end up, having all their own bills passed,while some of PRESIDENT BUSH
where altered. so don’t blame BUSH on that.
anticsrocks, hi,
you know instead of giving some idea to help solve this president spending’s problems,
they will go and bring BUSH , WHICH HAS NOTHING TO DO WITH THIS DEBT CEILING.
they cannot face it and take the responsibility for it
bye
@Greggie: You said:
Prove it.
Less than 6% of the stimulus package was for infrastructure, or “shovel ready” projects.
Tell me, how did that save the economy??
@anticsrocks:
That is what really gets me about nearly all of Greg’s posts. That he believes that simply because conservatives here criticize Obama, he somehow needs to defend him by bringing up things the GOP has done. And much of the time, it’s things that conservatives aren’t too happy about.
@ilovebeeswarzone: I hear ya, beezy. The lazy thing for them to do is to blame Bush. That is all they have since their golden boy, Obie is a spend-aholic to the Nth degree.
@johngalt: Yep, just like ms beezy pointed out, it is much easier for them to blame Bush. Now they are expanding that to blaming the entire GOP.
They are simply lazy, intellectually.
@Greg:
I think you are missing the point of that chart, Greg. While Germany may have the lowest total share of market income for their top 10% of earners, they also have the lowest tax burden placed upon those top 10%. When those two numbers are compared to one another, you get that last column, or, the ratio of tax burden to market income. Notice that Germany has the lowest, at 1.07, and the US has the highest, at 1.35. No other country is in the 1.3 range. What this means, Greg, is that while in the US, the top 10% have the second highest share of market income, that their share of the tax burden far outstrips all other countries.
So, don’t hold Germany to the standard we should strive for, otherwise you would need to start promoting either lower taxation for the “rich”, or the placing of at least some tax burden on the bottom 50% of wage earners in the US.
@johngalt, #97:
Actually I haven’t missed that, but my theory about why this might be so is probably different: Where income is more evenly distributed across all economic levels of society, there’s reduced need for governmental social programs to address the negative consequences of more grossly uneven distribution. People in general have an increased capacity to meet their own needs. A higher-paid labor force is more able to look out for its own needs. That reduces the need for taxes.
There’s another important element to Germany’s more favorable fiscal situation, I think: Germans are frugal. Their economy isn’t so dependent upon consumerism. They’re not constantly encouraged to buy what they cannot afford.
@Andrew:
Just a little clarification on your post #77.
-One, I’m sure the author of this article, anticsrocks, meant to say that the US’s top 10% pay for 45% of the total tax burden, or something close to it, since he is quoting from that very report, and chart. That you take his misspeak as some kind of conservative, or Republican talking point, is a mistake, on your part.
-Two, your paragraph discussing the low tax burden overall of the US taxpayers, doesn’t lead to a conclusion that the “rich”, only, need to pay higher taxes. Rather, based on your words, and the numbers from the OECD chart in Mata’s post, the only conclusion that one can end up with is that the poor to lower-middle class in this country need to start carrying a higher tax burden upon themselves, particularly considering that the US is tied for 37th out of 100 countries for highest marginal tax rate on individuals. Canada, which is ranked 7th on that list in the OECD chart, has a tax burden/share of income ratio of 1.22, however, they are ranked 61st out of a hundred countries in highest marginal tax rates with a rate of 29%, which is 8% or so less than ours.
-Three, the tax code has long been used by both political parties to pander to certain groups within the different classes. Neither the Republicans nor the Democrats are innocent of that. We have tax credits for school, for having kids, for being “poor”, for disabilities, and numerous other credits. Then, on top of that, there are forms upon forms, and lines upon lines, for people to list all manner of deductions. Both of those, combined or separate, lead to a lower effective tax rate for everyone. And the fact that you admitted pretty much tailoring your finances to take advantage of as many of those as possible, just shows the lengths that some people will go to in order to gain an extra buck or two.
Now don’t get me wrong, I don’t mean to disparage you in doing so. However, when you have politicians only mentioning the tax breaks that certain people get, and the agreement by their supporters that those should stop, at the same time they are gaining tax breaks of their own, is hypocritical, and shows how flawed the tax system is.
I say do away with all of those tax breaks. End ALL deductions and end ALL tax credits. For everything. Then, lower the marginal rates to the average effective tax rates for all tax brackets. No more paying out more money to a person than they paid in taxes throughout the year. Make everyone who works have some sort of skin in the game.
anticsrocks:
“You’ve got to be kidding right? I mean Obama increases spending in his first year in office by EIGHTY-FOUR PERCENT and you jump on that claiming that there is no deficit spending since the federal government has kept spending at that level.”
Bush’s last budget for fiscal year 2009 proposed spending $3.1 trillion. Actual spending that fiscal year was $3.5 trillion and I noted the reasons for the increase (increased unemployment insurance and food stamps – $100 billion, increased social security and medicare claims – $100 billion, and Bush’s TARP bailout for Wall Street Banks – $200 billion). Spending in Fiscal Year 2010 was actually $75 billion lower than in Fiscal Year 2009. So Obama’s very first budget actually cut spending year over year for the first time since the Eisenhower administration in 1955. The Republicans in Congress keep claiming they want to do that, but they had 6 years under Reagan and 12 years under Clinton and Bush and they never proposed anything of the sort.
The facts are all right there for anyone to see on omb.gov – the Office of Management and Budget Website. You can see it for yourself there, or you can wallow in igorance and stupidity. Your choice.
anticsrocks:
So when Obama spent the following… $787 billion stimulus package, $410 billion omnibus spending bill, $700 billion Wall Street bailout package, $3.6 trillion budget, $1.2 – $3 trillion for Obamacare
1) The stimulus package was 1/3 tax cuts. A lot of the spending was simple smoke and mirrors that replaced regular appropriations. 2) the omnibus bill was just the regular annual non-defense discretionary appropriations all bundled up together – not extra spending. 3) The TARP bailout did involve real money, but was passed under Bush and proposed by his administration. 4) We have yet to spend $3.6 trillion in one budget year. 5) We haven’t spent any trillions on Obamacare. It might happen, but it certainly hasn’t happened yet.
@Andrew: You are quite fast to throw personal insults, Andy. Is that all you’ve got?
Hey, when I cite statistics that have not been brought up before, I cite them.
What’s your excuse? You accuse me of wallowing in “ignorance and stupidity,” yet it looks as if you wish to wallow in laziness and dissembling.
Your move, jackwagon.
You’re new here, Andrew. But please allow me to point out the obvious. “Flopping Aces” doesn’t write zipola… This blog, hosted by former Marine and FA Founding Father, Curt, is a compilation of regular authors, whom you can view info and bios above at the “authors” link, as well as “reader posts” that are submitted to Curt for publication. Curt does not, and never has, approved readers posts based on it being in harmony with his own opinion, but whether it will stimulate debate. Nor does he proofread them for accuracy and research.
Therefore, I would request that you cease and desist the class categorization of a reader’s post, or even an author’s post (which won’t say “readers post” behind it…) as the entire blog forum. This is a community, made up of individuals. The majority share some form of conservative leaning. And we also have resident liberal posters as well. I would appreciate if you would appreciate that this is not an echo chamber, but a compilation of many varying voices… therefore avoiding any group labeling.
As for your 5th paragragh, INRE the tax revenues, I wouldn’t dispute much there save your characterization that it is “light”. Indeed, as you say, the majority of the nation’s tax burden falls on those that are more prolific in their endeavors. I wouldn’t say it has an undue burden on the middle class tho. Nor would I say it was light unless you want to weigh it against the determined and preordained entitlement spending that Congress, decades ago, strapped us into. Indeed, when you compare the balance of income tax-employee contribution & employer contribution for social security (Figure 0.1) to to OECD countries’ average, the US is not only not that far out of line, but that the employee vs employer ratio favors the worker over the employer.
Thus it still only confirms what I strongly believe… the problem with the US is not low taxes, or an imbalance of the progressive tax (via a liberal/socialist view…), but the amount of unchecked spending done by an irresponsible Congress for decades.
Greg and JohnGalt:
In Germany, the top 10% pay less of the total tax burden than in America precisely because they earn less money than the top 10% of America. On the other hand, a lot of the bottom 90% of society is a lot better off in Germany than in America, which is why they can pay more of the tax burden – because they make more money relative to the top 10%.
Basically, Germany has a much flatter income distribution that the US which makes it much simpler to have a flatter tax structure.
In the US, the bottom 58% of tax returns (everyone under $40,000 per year) account for 12% of total declared income while the top 15% of tax returns (everyone over $100K per year) account for 52% of the income. Basically, if you are not in the top 25% in the US, you are screwed.
Here’s the US distribution in more detail:
Top 0.1% earns 10% of all income
Top 1% earns 20% of all income
Top 5% earns 35% of all income
Top 10% earns 45% of all income
Here’s another way of thinking about it. From 1995 to 2008, US aggregate income doubled. 72% of the growth went to the top 25% and 11% went to the bottom 50%. Income for the bottom 75% declined in real dollars through the Reagan/Bush years, grew slightly during the Clinton years, and declined again during the Bush years. This shouldn’t be a shock to anyone. All of the marvelous growth in income afforded by the productivity increases of the American worker over the past 30 years has gone 100% to the Capital/Management/Ownership side of the equation, and 0% to Labor. JP Morgan notes for investors paying attention:
“As shown in the first chart, S&P 500 profit margins increased by ~1.3% from 2000 to 2007. There are a lot of moving parts in the margin equation, but as shown in the second chart, reductions in wages and benefits explain the majority of the net improvement in margins. This trend has continued; as we have shown several times over the last two years, US labor compensation is now at a 50-year low relative to both company sales and US GDP.”
http://www.investorvillage.com/uploads/44821/files/07-11-11_-_EOTM_-_Twilight_of_the_Gods__PWM_.pdf
Don’t you understand why the folks at the bottom are so mad? I assure you, its great to be up in the top, but its even better to stay there and not need to worry about pissed off folks down below coming to take away all your hard earned money. In a Democracy, you can’t expect the bottom 75% to keep running endlessly on a treadmill with no reward except to see the top 25% grow rich.
Sorry, Greg… couldn’t help it with that inane statement. Pray tell, how do you think income is “more evenly distributed” save via governmental societal programs?? It’s called forced charity, at the point of a gun.
@MataHarley, #105:
I think higher wages tend to have that effect; that is, workers receiving a larger share of the wealth that results from their mental and physical labors.
German workers have seen recent growth in real wages. In the United States the GDP has increased, but working people have received virtually none of that increase. Nearly all of that increase was distributed in a different part of the private sector. (As demonstrated by the report linked in post #9)
@Andrew, INRE your JP Morgan quotes/tidbits about the S&P. Oddly enough, it’s the S&P that’s been showing the only surprising stability thru this era. But I suspect you discount just how many Americans are actually now invested in stocks… even if passively thru their 401Ks and mutual funds… these days.
There are, however “investors” that have better-than-the-average-Bear-Stearns perks… and that would be Congressional members themselves (both parties).
But let me go back to my original observation of you, which you tended to shake off as laughable… that you are more partisan in your expression than analytical. First it was your continued attempt to dismiss Congressional involvement in budget/spending, and now it’s tying S&P performance to a POTUS as well. Call me wacky, call me zany, but isn’t this like comparing your apple pie to a red hot chili in the same contest? Each POTUS has had different economic challenges, as well as different entitlement debt with which to deal… not to mention military conflicts.
But if you insist, below is a chart that gives an average of the S&P over the terms of each POTUS.
Reagan stepped in after the Carter fiscal fiasco, and oil woes. With his combination of both tax reform/increases for corporate, and reduction of individual income tax cuts, the economy did rebound… and with a vengence. But then came the 1987 stock market crash at the end of his terms.
Clinton, who so many speak of in hushed revered whispers, enjoyed an era of the dot.com bubble, as well as the onset of the housing bubble. But we again had a stock crash in 2000.
The full weight of the housing bubble crashed with the most recent stock market fall in 2008. But that was more than a decade in the making, with the housing prices taking a beeline up in the mid to late 90s. Pile on to that the economic repercussions of Sept 11th, and two wars. Indeed, even with the easy money and irresponsible lending criteria that was established by the GSE’s by Congressional mandates, we could have survived the housing bubble were it not for the unnatural and astronomical increase annually in real estate assets which are normally a slow growing critter. Foreclosures have been a part of our successful history. But not when the house foreclosed upon is only worth a fraction of the debt owed.
Even today, most economists are boggled by how the stock market is performing. It is surely not on the old traditional standards of prudence. But then again, the stock market is no longer made up of the financial good ol boys and their stock brokers. Everyone and their mother’s brother has access to online trading on the cheap, and gambling is a habit that many find addictive. Some do it at casinos. Others, wiling away their days with day trading. And still others just betting on those that aren’t in the know.
It’s always funny to me when people speak of “speculators” as some foreign, faceless bad guy.. when in fact, so many Americans are speculators daily. They just may not be aware of it. Those making cash in stocks in this recession/depression… altho mostly in, and using, the financial institutions who enjoy risk free, low interest tax payer provided bail out money for trading… are actually Joe Blow citizens with their 401Ks and a nominal amount of investments. It’s not just for the privileged anymore.
ah yes… another government societal program called minimum wage. Yeah.. that’s really successful and oh so voluntary /sarc
I rest my case
The GDP has “increased” using what as a baseline, Greg? Or aren’t you keeping up with the revised reality, and clinging desperately to rosy predictions used to push thru yet another future entitlement program?
@MataHarley, #108:
Refer to Table 3 on page 20 of The “Jobless and Wageless” Recovery from the Great Recession of 2007-2009: The Magnitude and Sources of Economic Growth Through 2011 and Their Impacts on Workers, Profits, and Stock Values.
Are the figures false? The conclusion unsupported? Is it all somehow meaningless, in terms of the real lives of real people?
There ya go again…. being partisan instead of analytical. You are, of course, aware that health care spending – our largest expenditure – was the smallest increase in 50 years because of the economic slow down and high unemployment, yes? Think that saved any cash in that spending? And is that slow down something to be celebrated?
Do you think our debt interest rates were considerably lower in that year as well, also saving some fiscal outlay?
Do you think the massive decline in revenues may have anything to do with it too?
Interesting snapshot in time you decide to use to heap praise on Obama, Andrew. Stalled economy to the point spending declines is deserving of accolades? You’re one strange puppy. Why not pull up the the charts as US Govt Spending and have a more wide view of the spending picture. But you won’t see me giving the Zero in the WH any “atta boys”.
Perhaps you’d better have a better year by year look at the Clinton era, and when the fiscal tides started turning. It was only after a fiscally conservative GOP took over and started holding Clinton’s welfare happy feet to the fire. Oh.. the good old days. They sure lost their touch quickly, I’ll admit. However compared to the entitlement queen party, the Dems, they look positively like Ebenezer Scrooge.
Greg… lawdy, guy. GDP historical figures
GDP down in 2009, barely above the crash year of 2008 in 2010. As I said, what the heck are you using as a baseline? Our GDP, in theory, would always be apt to grow with expanding population and technology over the decades. However, as you’ll see at the US Govt Spending site states, the Bush years GDP growth left the Clinton years in the dust, and the Zero years have been a decidedly lackluster “recovery”. As a matter of fact, it appears to be the first decline in GDP history in six decades under Obama. While you’re there, using the graph and source stats, why don’t you show us where there was a decline in the GDP after previous recessions in the 20th Century, Greg. Hint.. there wasn’t. Because none of those POTUS had idiots as economic advisors.
One more thing, Greg…. since you insist upon moving the goal posts. You said:
First I have shown you that the GDP has *not* increased but, for the first time in 60 years, declined following a recession thanks to idiotic economic policies and unfettered additional spending. But then you tie it to your favored obsession, the wealth gap, by noting that “working people have received virtually none of that increase”.
And to prove your point, you link to the Table in your PDF link. Let me ask you this… have you got a clue what the increasing percentages mean in the column marked “Corporate Profits Share of Growth in National Income”?
Who is the corporation, Greg? Who profits from a corporation’s growth? They’re called shareholders. Shareholders are comprised of everyone from Joe Blow at Walmart to teachers, firemen, pensioners, 401K holders…. employees who often have a piece of the pie of the company they work for, or who’s pension or 401K funds are invested in other companies.
You always suffer from the same problem. You look only at wages when an employees salary is made up of many sources of income… from their salaried take home pay to their pensions, investments, and health benefits provided. It’s almost a business barter system. When something disappears from one column, it most often shows up in another. Providing incentives is how employers attract good talent. However now the incentives are starting to disappear, the fiscal threats are on record, and companies are now learning how to make do with shadow staff and part timers to beat the tax and regulations system.
@MataHarley, #110:
Am I missing something?
The GDP for 2008 from that historical chart up above doesn’t actually look like an off year, does it? In fact, it seems to represent the highest figure of any of the 8 GWB years. The crash is first reflected in the 2009 annual GDP total, not 2008. You’re actually using the highest recent pre-crash year as the baseline, and finding post-crash increases wanting by comparison. You’ve got to start measuring post-crash growth and income increases from a new starting point–which, unfortunately, was in the basement.
The figures cited by the Center for Labor Market Studies report covered a period of consecutive quarters corresponding to the post-crash turn around; specifically, the period “between the second quarter of 2009 and the fourth quarter of 2010″. During that period, they state, real nation income increased by $528 billion; of that increase, working Americans basically got squat. The lion’s share– $464 billion–took the form of corporate profits. This would fall into the period of all those consecutive quarters of record corporate profits, I imagine. I’m actually not sure if that run has been broken yet. I haven’t looked it up.
Duh.. yes, Greg.. you’re missing something. Crash happened in Sept 2008. Hint to the wise… don’t depend on pictures. The source data and numbers provided for the chart are below. Try reading instead of visual pics.
GDP down in 2009… wow, great stimulus and shovel ready, eh? LOL 2010 is up, but far below the Zero’s boasted expectations. In fact, even in the 20th century recessions.. including Reagan following Carter in, we never had a decline in the GDP. That’s an accomplishment distinctively Obama. Don’t be lazy.. go ahead. Pull up the stats from 1900 on. Let me know when, in our history and thru any recession in the 20th century, did our GDP decline?
Only with da zero.
Don’t care about the figures cited by the CLMS. And again, I will remind you… you are clueless to who “the corporations” are, and their increase in the profits. You are simply too tunnel visioned in the real world.
Well, jeez… I look at that number for 2008, and it still seems like the highest number on the list. Yep, the economy hit the skids in September 2008, but there’s a time lag in the numbers. Looking at totals by calendar years can be very misleading, I think.
I agree, having “fiscal years” is difficult. But you have to divide it somewhere, somehow. But 2008 is high because they didn’t start doing the chicken little dance until fall. Sometimes I look back on that and wonder how much was real, and how much was fabricated. It wouldn’t be the first time the US taxpayer has been hosed.
None of that precludes that we’ve had stock crashes and recessions before. Including the Great Depression. And still the GDP did not decline over the end of the year. Especially after Congress and this POTUS pushed a pile of cash into the system, and bought a car manufacturer to give to his union thugs… er…. buds. It’s quite obvious, as even Obama admits, that the stimulus did not work. It just paid the salaries of many a local government employee, delaying the inevitable.
The housing incentives are also damaging and the repercussions still ringing thru the courtroom foyers…. with companies like B of A being sued for their abuse of HAMP/HAFA etc. Housing is in the toilet, and will remain there for quite some time…. and would have been much better off if Obama and Congress had not tried to “help”. Instead, they tried to artificially inflate the bubble and not let the values fall as they must do. The tax credits created a boatload more toxic assets. Once they raise rates, lending will be shaved down to a ghost of itself because no one will be able to refinance their homes with 4-5% rates, and few will be able to sell for what they paid. They have a $200K loan balance at 4-5%. If the rates go back to 7-8%, who can afford that $200K loan?
Yeah, real improvement.
@Andrew: You said:
Oh jeez, here we go again. Looks like Greggie has a buddy in that old Marxist song and dance, “Them evil richies be gettin’ all da dough!”
You are all in favor of less of an income gap as long as it means that no one gets wealthier. So you want to keep the poor, poorer? Wow.
That’s compassion!!
anticsrocks:
“You said”
No, Sir. I quoted a JP Morgan research report for wealthy investors and gave you a link to it and pointed out what it is saying. You know JP Morgan right? Its a large and venerated Wall Street invesment banking house.
I don’t blame you for getting upset about it being publicly aired, but the IRS income stats show the same thing, and, well, there it is.
I think you are setting up a false dichotomy of: “Either the top 25% gets all of the income growth, or there is no income growth at all.” There are more choices than that, and Republicans once upon a time proudly supported trade and tax and immigration policies that were aimed at and succeeded in getting business to invest in America and pay Americans the best salaries in the world, instead of prioritizing the China trade and the delivery of our hard earned money to Arab oil sheiks and the Chinese Communists.
Yet you excuse obama and the dems pushing for insane levels of spending that DID NOTHING but raise the debt.
As for obama not having enough time, that is a hoot coming from a leftist. It was leftists who blamed W for the recession that started under Clinton. It was leftists who blamed him for 9/11 despite having even less time in office than he should due to gore trying to steal the election. NOW you want to whine about not enough time? Tough.
And I predict you will be proven wrong by history…AGAIN! The stimulus did nothing but waste money. Historians have shown that the efforts the dems and obama are making are the same ones that EXTENDED the Great Depression. The left is desperate to re-live what is a lie. They have convinced themselves it was their greatest success. Some of us who have bothered with history don’t care to repeat it for the sake of your ego fix.
@ MataHarley:
I am well aware of the widespread nature of stock ownership. Most of this is buy and hold investment in 401K’s and the like, as you note. Most of the market volume is speculative high velocity trading.
“Indeed, even with the easy money and irresponsible lending criteria that was established by the GSE’s by Congressional mandates, we could have survived the housing bubble were it not for the unnatural and astronomical increase annually in real estate assets which are normally a slow growing critter.”
Just like getting pregnant, it takes two to create irresponsible loans. For every bank handing out money that will never be repaid there was a complete idiot who thought it was a great idea to lie about his income and buy a house with a variable rate ballon loan at a price that was six times his income. Its hard to feel sorry for any of these people or the banks. As a sober and responsible person who lives below his means and considers worst case scenarios, I think the greedy bastards are all getting what was coming to them.
“Even today, most economists are boggled by how the stock market is performing.”
Frankly, most economists are idiots who do not understand the basics of their own profession. That is why they are slaving away as low-paid economists and not sitting pretty on top of millions. If they really understood how the market and economy behaved as they claim they do, they should be able to make a killing in securities.
Most economists do not appear to understand the basics of investor sentiment, timing investments, valuing securities, the relation of profits to cash flow to long term stock prices, the driving forces of population growth, natural resource extraction and agricultural production behind all economies, and other basic concepts. I watch economists making all manner of unrealistic projects, especially endless projections of exponential growth curves, missing important trends until 10 or more years after they started, and obsessing about unprovable projections of the effects of minor changes in fiscal policy or regulation instead of understanding the big picture drivers of the world economy as a whole.
There is nothing boggling about the stock market’s performance. It was way overpriced in 2006 to 2008, signalling a great time to take money out of the market while the suckers were piling in and generally straighten up your finances in preparation for bid problems. It was vastly oversold in winter of 2009 as those same suckers panic sold their holdings for a major loss, so it was a perfect time to take your cash bundle off the sideline and pile in for a ride to multi-hundred percent gains in wealth in any number of hundreds of very sound stocks. This has been one of the most exciting times to be an investor in a very long time – I would say since 1994, maybe even 1987. You just don’t get opportunities like this very often to hit the cyclical wave at the trough and ride it up. Any economists who didn’t understand that and clean-up over the past three years, well, I simply can’t respect their knowledge of their own profession. They were probably too busy obsessing about Bush and Obama and McCain and whatever minor tweaks tweedledum and tweedledee might make in Washington. The worst are the morons who thought that the election of Obama guaranteed a new depression and so panic-sold in the 2008-2009 winter and then sat on the sideline of the market for the past two years as it doubled in value.
Why is the market going up? Because if it had continued down to where some people were predicting it would go, dividend yields would now be something on the order of 7-10% on an average stock versus long term interest rates of 4%, and high yield stocks (say, AT&T or Exelon or Altria) would be yielding 15% or more. How realisitic is that? Obviously not very.
@ Mata Harley:
“Perhaps you’d better have a better year by year look at the Clinton era, and when the fiscal tides started turning. It was only after a fiscally conservative GOP took over and started holding Clinton’s welfare happy feet to the fire.”
The slow-down in spending started in Fiscal Year 1991, 5 budget cycles before the Fiscal Year 1996 budget, which was the first budget of the Republican congress. The FY 1991 budget that implemented the much hated 1990 budget deal that raised taxes and slowed spending growth. There was no difference in spending growth before the Republicans took congress in 1995 and after until Bush came to office. Numbers are here:
FY 1981-1991 – avg. spending growth 7.25% (Reagan’s 8 years + first 2 years of Bush)
FY 1991-1995 – avg. spending growth 3.43% (Bush’s last two years and Clinton first two)
FY 1995-2001 – avg. spending growth 3.51% (Clintons last 6 years/first 6 years of Republican Congress)
FY 2001-2009 – avg. spending growth 8.27% (Bush’s 8 budget years in office)
FY 2010 ——– avg. spending growth -1.81% (First Obama budget)
Year over year growth by Fiscal Year:
1988 – 5.93%
1989 – 7.59%
1990 – 9.42%
1991 – 5.75%
1992 – 4.31%
1993 – 2.01%
1994 – 3.69%
1995 – 3.76%
1996 – 2.96%
1997 – 2.60%
1998 – 3.21%
1999 – 3.10%
2000 – 4.98%
2001 – 4.23%
Remember, the Republican wave election was in 1994, they were seated in 1995 in the midst of fiscal year 1995, and passed their first appropriation bills in the fall of 1995 for fiscal year 1996. Its tough to see how the Republicans elected in 1994 had any affect on the budgets passed before that election.
@ Mata Harley:
The current dollar GDP numbers you cite are an average of the 4 quarters of the calendar year. They are therefore subject to selection bias for showing what year had a drop because you are not using a moving average and comparing any set of 4 consecutive quarters regardless of where they fall relative to the calendar year. The effect of low inflation in any given year will also cause biases. 2009 was a year with deflation because of the collapse in oil prices. So it is not surprising that during a recession with deflation, current dollar GDP would drop. The early 1980′s were a terrible time economically, but current dollar GDP kept right on growing because inflation was over 10%. Back before the 1970′s-1980′s inflation, current dollar GDP dropped during the recessions in 1949, 1953, and 1957. The drop in 2009 was from a peak in the 3rd quarter of 2008 at 14.484 trillion to a trough in the 2nd quarter of 2009 at 14.034 trillion. This corresponds very closely to the time frame of peak to trough oil prices.
I don’t know why you are working with current dollar GDP. Constant dollar is much more interesting to show actual economic growth and decline free of the effects of inflation and deflation. Real GDP in 2005 dollars shows a peak in the 4th quarter of 2007 at 13.364 trillion and a trough in the 2nd quarter of 2009 at 12.810 trillion where it returned to the size it had been in the 4th quarter of 2005. We are currently at 13.444 trillion in the 1st quarter of 2011, so the economy as a whole has increased in size by 5% in 7 quarters and returned to the size it was before the recession began in the winter of 2007.
Not to rain on the parade of either forgetting history or re-writing it, do you think that perhaps some of those low deficits that Clinton gets credit for happened in a large part because of the end of that pesky little 45 year event called the Cold War? Remember something called the “peace dividend”? Do you think those nice small deficits would have happened if we were still fighting the Cold War? We would have spending a lot more on the military. Go back in there and add several hundred billion dollars in military spending that would have been needed to fight the Cold War in the ’90′s and you’d probably see deficits under Clinton totaling over a trillion dollars as well. Add to that an economy that was in overdrive because of the dot.com surge, the Y2K scare, and an overinflated housing market compliments of giving out bad loans all of which came full circle after he left office. And let’s not forget, we weren’t at war because it was decided that it was best to look the other way with regards to OBL. Ignoring that threat worked out real well on 9/11 didn’t it? But hey, not spending the funds needed to take him out in the ’90′s helped keep the deficits lower. I wonder how much that comes out to per life on 9/11.
As for rewriting very recent history by claiming Obama had absolutely nothing to do with the deficits being run up despite his signature being on those budgets, oh well, the messiah can do no wrong. Keep on blaming everyone else. Since the only president to have ever gotten us to be being debt free was Andrew Jackson, it probably won’t be too long before Obama’s disciples start blaming Martin Van Buren for the deficits Obama has piled up.
@Andrew: @Greg:
I believe that you guys are missing a very important point that has, literally, nothing to do with the actual tax rates in place.
After perusing and studying various tables on all manner of income statistics, tax statistics, and GDP statistics, something jumped out at me. During periods of decent to high economic growth, income disparity becomes greater, regardless of the tax rates in place, and during periods of low to no to negative economic growth, the disparity in shares of income contracts. That is, when economic growth is high, the shares of income for the top 50%, and in particular, the top 1%, grows while the share for the bottom 50% shrinks. And when economic growth is low to negative(as seen from 2007-2008), the income share for the top 50% shrinks and the income share for the bottom 50% grows.
And, as one would expect, the share of income tax burden reacts similarly.
And remember, I said that this happens regardless of what the actual tax rates for the various brackets are, at the time. This effect can most clearly be seen in the two periods of 00′-01, where the GDP grew at only just above 1%, and 07′-08′, where the GDP growth was actually negative, and comparing those to the previous years of GDP growth. Both periods had different tax rates, one being the Clinton era tax rate and the other being the Bush tax rates. One can also see the effects following any year to year drop in GDP growth of less than 2%.
What does this mean? Well, what it tells me, is that during periods of low to no to negative economic growth, that the bottom 50% tend to retain more of their income, in dollar figures, than the top 50%( or whatever other percentage within that top 50%). This can be seen clearly in the 07′-08′ period, where the AGI of the top 50% shrunk 4.77%, while the AGI for the bottom 50% shrunk only 0.28%. And if we go back to the 00′-01′ period, we see that the top 1% had their AGI shrink by 18.2% while the bottom 50%’s AGI actually grew by 3.36%. In other words, the bottom 50%, while having no employment growth, or even shedding some jobs, the people working in that group tend to retain their current wages while the top 50% drop wages.
Is this really that “unfair” to the lower income earners? What I see is more volatility at the top, depending on the economic circumstances at the time, and more stability at the bottom. And all of this is regardless of the current marginal income tax rates. And so, while the bottom 50% does not see their income rise by all that much during times good or better economic growth, they also don’t see their incomes lose all that much, if anything at all, during economic downturns.
Here are the links that I looked at;
http://www.taxfoundation.org/news/show/250.html
http://www.data360.org/dsg.aspx?data_set_group_id=353
http://forecast-chart.com/chart-gdp-rate.html
another vet,
hi, he had OBL in the palm of his hand, ready wrap to pick, and yes did not want to bother,
but he save a lot of moneys , at the expanses of 3000 lives,
I always wonder how come those LEADERS, don’t figure the consequence of their actions or decisions
@ilovebeeswarzone:
It’s because many of them do not want to take the responsibility of their actions or decisions, but only want the credit for something “good” happening under them. That’s why many “leaders” don’t make the hard decisions
It is easy to claim your righteousness when you cherry pick, Andy. You look at one variable and claim success in your viewpoint. Debating with you is like debating with a 5 year old, you only see one metric.
I don’t think you can claim to score any points when you try to frame the debate to make it lean your way. Either use all the facts, or none at all.
Nice try, very Alinsky-like.
@ilovebeeswarzone: Sometime after the Cole attack, there was a front page article in the Sunday Chicago Tribune featuring an interview with someone from the Clinton administration, I believe it may have been his press secretary, all I remember is he was someone well known in the administration. They asked him about the OBL problem and he pretty much stated that the only way to get rid of him was with military action and that required ground forces in Afghanistan which would lead to American casualties and they didn’t want to risk political backlash for that. That gets back to the point johngalt made in 125 about leaders and why our current President doesn’t make the grade. Someone who kicks the can down the road and always blames others for his/her shortcomings is not a leader.
@another vet, #127:
Obama didn’t kick the OBL problem down the road. He kicked OBL off the planet.
AnotherVet and Greg Eliminated with extreme prejudice and dropped in the middle of the deep blue sea. No “kicking down the road”
like previous admins.
GREG, he back down at the last few hours, He wanted to sleep on it,
and PANETTA took the initiative away from him and order the mission to get ahead,
and so they did. because the mission was ready to go,
how can you when all is ready decide to think about it?
and go sleep on it, creating a danger of a leak that could have killed everyone doing the mission for you,
@Greg: Actually our military kicked OBL off the planet. I did give Obama kudos for authorizing the mission. I’m referring to the debt and host of other issues. He’s not the only culprit by any means, but blaming others and not taking responsibility for the deficits he has run up doesn’t cut it as a leader.
@rich wheeler: How did he accomplish that in D.C. when OBL was in Pakistan? That’s like saying Bush killed Hussein’s kids. Credit goes to the military. Good to see that his fan club is still giving him credit as opposed to those who put their lives on the line to make it happen though.
@rich wheeler: You said:
So the policies and protocols put in place by Bush that directly led to OBL’s death had nothing to do with it?
Don’t you think that view is just a bit short sighted?
Here is Something about the “Rich” Mr Obumbles wants everyone on the “Left” to Bash to continue the Class Warfare mime in order for Obumbles and the Left to create the Socialist Utopia that never worked anywhere… ever…
“Many of the world’s richest such as Google’s Sergey Brin and Larry Page…NBA’s most valuable player for several years LeBron James and Pop Star Justin Bieber (to name a few) …gained their wealth by making extraordinary contributions to their communities either through the products they invented, or the entertainment they provided. They became ” rich” NOT AT THE EXPENSE OF OTHERS, but through voluntary exchanges that have enriched our society.” As with and so true of many “Rich” people in our Society…we as a society have continually reaped the rewards of the rich who have enriched our lives by their innovation(s) … these are innovations are ‘things’ that make our lives easier not harder…. Would we be having this debate if it were not for uber rich Bill Gates? Who by the way has DONATED millions by way of “giving back” to society?…
(a-hem, where he stands now however, is not the point)
Liberals don’t really care who’s hard earned money they “steal” …. tell me – how can ‘stealing’ make someone “feel good” ?? Oh, right… I forgot who the ‘someone’s’ are….the Liberals/Progressives…
The Liberals are such “Parrots” for the likes of Obumbles…it’s a sad sad Left side of America…
FAITH 7, HI,
WOW, YOU HIT THE NAIL
hope they read that smart comment,
they would learn more here than in the MARXIST BOOKS THEY HAVE STUDIED
WITH SUCH INTEREST, AND TRYING IT TO THIS AMERICA, ON THE
EVER TOLERANT PEOPLE WHICH NOW HAVE MORE THAN ENOUGH OF THEM.
@ Faith 7
Bill Gates did not invent the internet. Or the web browser. Or the computer.
You wouldn’t be having this debate without the US Government having funded the creation of the internet through the funnelling of money to pointy headed intellecutals in the academic ivory tower. Don’t forget that as you busy yourself attacking our government.
@Andrew: The internet, or DARPA was around for decades before Bill Gates and good old fashioned capitalism made it available to John Q. Public.
Much the same as Henry Ford made the automobile available to those of modest means.