President Obama gave another speech this morning, this time announcing his deficit reduction class warfare plan:
President Obama called on Monday for Congress to adopt his “balanced” plan combining entitlement cuts, tax increases and war savings to reduce the federal deficit by more than $3 trillion over the next 10 years, and said he would veto any approach that relied solely on spending reductions to address the fiscal shortfall.
“I will not support any plan that puts all the burden for closing our deficit on ordinary Americans,” he said. “And I will veto any bill that changes benefits for those who rely on Medicare but does not raise serious revenues by asking the wealthiest Americans and biggest corporations to pay their fair share.
“We are not going to have a one-sided deal that hurts the folks who are most vulnerable,” he continued.
…Mr. Obama is seeking $1.5 trillion in tax increases, primarily on the wealthy and corporations, through a combination of letting Bush-era income tax cuts expire on wealthier taxpayers, limiting the value of deductions taken by high earners and closing corporate loopholes. The proposal also includes $580 billion in adjustments to health and entitlement programs, including $248 billion to Medicare and $72 billion to Medicaid. In a briefing previewing the plan, administration officials said on Sunday that the Medicare savings would not come from an increase in the Medicare eligibility age.
The plan also counts a savings of $1.1 trillion from ending the American combat mission in Iraq and the withdrawal of American troops from Afghanistan.
…But Mr. Obama spent much of his talk in the Rose Garden making an impassioned plea for what he called fairness in taxation, on the premise that “middle-class families shouldn’t pay higher taxes than millionaires and billionaires.”
“This is not class warfare,” he said. “It’s math.”
“It’s math”
….I can see it now; this will be the new campaign slogan.
And that’s all this is. It’s a speech, and a plan, laying the groundwork for 2012. There is nothing serious in this plan. Nothing that will get passed by Congress and no indication that Obama will seek to compromise. Instead we get more class warfare in the hopes that somehow, someway, this will get him re-elected.
From The Tax Foundation:
Some specific effects which will arise from these proposals include:
- Creating perverse incentives for healthcare providers
- Decreasing the long-term solvency of Social Security by claiming to veto any bill affecting Social Security without nebulously defined revenue increases
- Handicapping lawmakers with the 2:1 spending-cut-to-revenue-increase ratio
- Relying on static economic conditions rather than the more realistic dynamic conditions which affect the source of capital gains taxes (one of the most volatile sources of revenue), as large part of the “Buffett Rule.”
The dire nature of the country’s fiscal situation, which Obama’s proposal is meant to address, will be exacerbated, not helped, by most of the proposals he put forth.
“Veto threats, a massive tax hike, phantom savings and punting on entitlement reform is not a recipe for economic or job growth — or even meaningful deficit reduction,” said Senator Mitch McConnell of Kentucky, the minority leader. “The good news is that the joint committee is taking this issue far more seriously than the White House.”
Mr. Boehner said, “This administration’s insistence on raising taxes on job creators and its reluctance to take the steps necessary to strengthen our entitlement programs are the reasons the president and I were not able to reach an agreement previously, and it is evident today that these barriers remain.”
Obama’s speech was nothing more than empty rhetoric to play to the base. It was a speech reminiscent of his speeches in 2008 but what this man can’t seem to grasp is that times have changed. The hopey-changey crapola isn’t playing anymore because people now see what his policies have wrought. Furthermore, if he thinks he has some kind of leverage because of the automatic cuts due to come in December, if no deal is reached, then he is sorely mistaken…again. Republicans would rather have budget cuts without tax increases, which is what we will get with those 1.2 trillion dollar automatic cuts. There are some defense cuts built into those automatic cuts which we would rather not see but if this man really believes the GOP will make a deal to increase taxes, in this economy, he is high as a kite.
I’ll close this out with this great observation from Ed Morrissey:
With even his own party insisting that they’re not going to bite on more spending and higher taxes, Obama’s already starting to isolate himself on economic policy. He issued this warning in a sad attempt to impress a few people on the Left with his “leadership,” but issuing empty threats isn’t real leadership. It’s an expression of political impotence.
See author page
How often has Obama spent billions and claimed that some of it was ”paid for” by ending the Iraq/Afghanistan wars?
ObamaCare.
TARP.
Stimulus I
Now Stimulus II.
In March 2011 we even had an admission of double-counting the ”savings.”
Medicare’s chief actuary explains Obamacare’s double counting. By: Philip Klein
and
Health and Human Services Secretary Kathleen Sebelius admits ObamaCare books Were COOKED. by Jeff Dunetz
Now it looks as though Obama has graduated from plain lies with numbers to complex deceptions in some vain hope we all forget everything older than last week.
We need tax increases. Period. Absolutely everyone agrees with this — even a lot of Republicans who are too chicken to admit it in public.
I think that Obama has decided that he’s probably going to lose the election anyway; so he’s giving up on his efforts to forge compromise agreements. He’s just going to do what he and his administrative team thinks is the right thing to do and let the chips fall where they may.
Thank goodness. It’s about time.
– Larry Weisenthal/Huntington Beach, CA
For all the “progressive logic”, upping taxes on the entrepreneurial and capitalist portion of the population when you’re trying to overcome a recession with persistent unemployment is nothing less than insane…eating your seed corn to get you through the winter is the analogy that comes to mind. Obama and his merry band keep criticizing corporations for sitting on their cash, threaten or propose to find new ways to tax it into the Treasury, and then wonder why it’s not being invested in new jobs…or why their minuscule tax incentives for hiring are ignored…Taking actions that intentionally drive up business costs (Cap and Trade, Libyan assault, Obamacare, EPA threats to put coal burning power plants out of business, blocking pipelines from Canada or drilling in the Gulf) and wondering why nobody’s hiring is the perfect fusion of gross stupidity, faulty ideology, and utter incompetence.
Business people are in it for the long run, not to hire now and fire a few months later when the cash flow to pay for the new employee or the new physical plant doesn’t materialize…
It’s a two step process; the deficit/debt is a long term problem; not a short term problem. The tax increases are phased in, down the road. They need to happen and they are going to happen — no matter who gets elected, come 2012. I give Obama a modicum of credit for finally taking the lead and being the one to tell it like it is going to be.
Supply side economic theory is the Emperor’s New Clothes. Someone has to take the bull by the horns and tell the truth — that it’s all an illusion.
A great starting point is the writings of David Stockman. Pretty much everyone now agrees with Stockman, only Republicans are focused — first and foremost — on what Mitch McConnell said is Job #1. Ensuring that Obama will be a one term President.
Obama has seen the handwriting on the wall and is now focused on putting his Presidency on the correct side of history, as opposed to tilting at the illusory windmill of political compromise.
– Larry Weisenthal/Huntington Beach CA
WHY does OBAMA trying to make trouble for the next 10 years, when he will not be there,
he is relaying the debt to other generation, and other leader of the UNITED STATES OF AMERICA:
CAN HE JUST TAKE CARE OF HIS OWN TIME AS PRESIDENT, AND MAKE THE BEST HE CAN NOW,
INSTEAD OF TRYING TO WEAR THE BOOTS OF THE NEXT PRESIDENT,
WHICH WILL IN FACT NEED HIGH BOOTS TO WALK IN THE LAYERS OF MUD ON THE FLOOR OF THE WHITE HOUSE,
BUT WILL BE MORE ABLE TO DEAL WITH THE PROBLEMS LEFT BY OBAMA, WHO WHERE BLAMING BUSH WHEN HE ARRIVED HIMSELF, BUT WILL HAVE A LOT MORE TO BE BLAME FOR AFTER HE LEAVE.,
SO HE JUST LEAVE THE NEXT YEAR TO OTHER AND DEAL WITH WHAT IS LEFT FOR HIM TO CORRECT, THERE IS MORE THAN ENOUGH THERE FOR HIM TO WORK AT.
P.S. … one other issue:
None of these has a hill of beans to do with the current economic climate or as a barrier to recovery. We have a consumer economy. Businesses will hire when consumer demand increases, not on account of any of the above minor distractions/squabbles. Consumer demand grew in the Bush years as a consequence of the housing bubble — the great majority of the subprimes went for re-financings for middle and high income people, and not for poor people getting into the housing market.
The problem is that people no longer have their houses to use as piggy banks. Housing prices won’t recover for a long time (as Mata has previously explained). Banks are still being hit by the backlog of foreclosures and aren’t making consumer loans.
Nothing is going to improve the economy — for a very long time to come — other than government spending on infrastructure.
The GOP will probably sweep in 2012. Their fortunes will rest on the recovery in the housing sector, not on drilling in the Gulf of Mexico, etc. etc. etc.
– Larry Weisenthal/Huntington Beach CA
Who is this runswim troll?
Nothing is going to improve this economy other than government spending on infrastructure?
???
Hello?
Anybody home?
The government will either spend money it borrows or money it collects. Collecting money means that persons otherwise able to invest and build and grow businesses on their own will have none. Borrowing money means passing the buck to our children and grandchildren.
Give me the name of ONE country in all of recorded history which has improved its economy by government spending on infrastructure. Just one. No obfuscations, no tergiversations, just time and location (please).
We need tax increases? And we need more banks to collapse. And we need more businesses to fail. And we need rampant inflation (say 1000%) to take away the property of millions. And then we need to nationalize the entire economy. Then we will be Hindenberg’s Germany. And all but the party favorites will live in tar paper shacks, with no electricity, no running water, and no employment. What a thrilling prospect.
Oh, well.
Hi Math, I’m not a troll. I’m a real person. With a real name. Larry Weisenthal. You can Google me. Pleased to make you acquaintance.
You raise a whole lot of issues. I’ll address just one. You ask for an example of government infrastructure spending solving fiscal crises. It’s a question which can’t be answered, because it’s not that simple. The favored conservative example is Japan. But the Japanese had a toxic asset/banking failure problem which they failed to address in the timely manner in which Paulson and Bush and Geithner addressed our own banking crisis. It’s the classic problem of proving a negative — how much worse would it have been for the Japanese, absent their infrastructure spending?
With regard to debt — our debt to GDP ratio was 50% higher following WWII than it is now. We paid this down by almost 75% not by having low tax policies to “grow the economy” but by having robust tax policies to pay down the debt.
Infrastructure spending isn’t throwing money away, It’s borrowing money to build something of lasting value — no different from borrowing money to build a home or a factory.
Our national infrastructure has been shamefully neglected. Now is the perfect time to end this neglect.
Here’s a high end economic blog devoted to the discussion of these issues. Many of the discussants hold views different than yours, but they are not “trolls;” they are simply people with honest differences of opinion with you.
http://economistsview.typepad.com/economistsview/fiscal_policy/
– Larry Weisenthal/Huntington Beach CA
From the transcript of the whole speech:
Who here is chronically ill?
I know I am.
Arthritis.
It only gets worse when it doesn’t stay the same.
What did Obama just do to patients like me?
Throw us under the bus?
(OK, I’m not on Medicaid. But people LIKE me.)
If doctors and clinics can’t get the same payment when too many of their patients aren’t improving, they will quit accepting patients who cannot get better.
Simple as that.
But Obama also wants everybody covered.
So, who is going to take care of sickly people like that for cheap?
Quacks and con artists, students and the underground.
Those are my guesses.
@openid.aol.com/runnswim:
We need revenue increases, Larry. But that doesn’t mean we need tax rate increases. That’s all your side ever comes up with. Even when the amount of money raised isn’t anywhere near enough to plug the gaping holes in the budget. What’s the point, just to punish success, or to give the appearance of action? The problem with your message is that you are telling folks that they need more government, that they should want more government, but that they won’t have to pay for it because you can force someone else to pay for it. How about telling people the truth, that if they want more government they’ll have to be prepared to pay for it? You know, like with pretty much everything else in life in a free country.
Hi Doug. You are speaking in 2012 political slogans. That’s fine. As I wrote initially, taxes are going to have to be raised to dig ourselves out of the hole we dug for ourselves by putting too many things on the credit card over the past three decades and not paying for it ourselves, in real time. Virtually everyone now acknowledges this — publicly in some cases; privately in others. It’s going to happen. Take it to the bank (if you can find one still solvent, at the time).
What’s with this “punishing success?” Allowing the Bush tax cuts to sunset, which was supposed to be the deal at the time they were passed (to deal with a “problem” which never existed — the projected revenue surplus into perpetuity), is “punishing success?” Raising an equivalent amount of revenue through tax code adjustment is “punishing success?”
It’s a useful political slogan. Just like “class warfare.” It may well be a successful political strategy.
Again, we didn’t just grow our way out of debt, following WWII. We taxed our way out of debt. We were on a track to sustain this debt reduction, clear up to the time when Reagan jump started the Supply Side era. It was a viable theory, at the time, just as communism was once a viable theory. But Supply Side economics is, by now, the second most discredited once-viable economic theory in post-19th century history.
– Larry Weisenthal/Huntington Beach CA
Hi Nan, Your description of “paying for outcomes, rather than for procedures” brings back none-too-fond memories of the “death panel” debate. You don’t understand how this works; it was the centerpiece of Tim Pawlenty’s health care plan, as well.
http://www.kaiserhealthnews.org/Stories/2011/May/26/California-Health-Line-Pawlenty-Health-Reformer.aspx
http://www.kevinmd.com/blog/2011/06/paying-outcomes-improve-healthcare-quality-efficiency.html
There is $11 billion in ObamaCare to research/test/pilot the “paying for outcomes” concept. The idea is to collect data on how it works in the real world before implementing it, system-wide. This is a very responsible approach to this most promising of all potential solutions to the problem of out of control health care costs.
Remember, the fatal flaw in the concept that private sector medicine works the same way as other sectors of the economy is that, in health care, the sellers make the purchase decisions on behalf of the buyers. The incentive is to provide as many services as possible, as opposed to actually solving the problem.
– Larry Weisenthal/Huntington Beach, CA
Well, Larry, Obama and the Democrats appropriated and spent about 800 billion dollars for stimulus spending, and said it was going to go for infrastructure. But very little of it was spent on infrastructure. Instead, it was largely used to prop up state pension funds and hire state workers. Obama himself announced recently that he had discovered that in contrast to his confident lectures in 2009, there is actually no such thing as a “shovel ready” project – which is what his critics were saying in 2009. So why would anybody trust that this crew is going to spend any new appropriations on infrastructure? They said they were going to and then they didn’t.
Remember Obama a couple of years ago, smirking condescendingly and lecturing us on how it did not matter what the money was spent on, it’s all stimulus? Do you agree with that Larry: that it doesn’t matter what it’s spent on, it will stimulate the economy just so long as it gets spent on something?
I say this fractured Keynsian faith of theirs is utterly discredited by events. $800 billion spent and nothing to show for it. This recession is very atypical in that there really has been no recovery at all. Maybe what they’re doing is prolonging it. Maybe giant reallocations of funds by the government are an intrinsically distorting and damaging thing for the economy.
Businesses borrow money and buy new equipment and hire new employees when they have confidence in the economic conditions of the next several years. Regulating and taxing them to death, calling them names, and cutting special deals for large campaign contributors does not inspire confidence, Larry. Just the opposite. Obama started tanking the economy before he was sworn in, before he had spent a dime of Federal money. Businesses saw what was coming and decided to sit on their cash and cut back. They can see just fine, Larry.
You want some stimulus spending that will actually benefit the economy? Quit hounding and harassing businesses and they will start to spend the 2 trillion in cash they are currently hoarding as they wait for better times. And that type of ‘stimulus’ won’t be taxpayer money either – it won’t cost the government.
The disdain and distrust of Obama and the top Democrats is so deep, and their inability to change their approach so evident, that it will take electing a new government to restore the missing trust. If the new leadership is smart they will make it quite obvious that times have changed and that they will be rolling back all this crazy stuff.
That you can defend this group of hacks and naive idealogues is puzzling, Larry. Perhaps you should keep in mind that a promised or projected outcome from a politician is not the same thing as an actual outcome.
I am a Republican who agrees with Larry.
Raise taxes on registered Democrats as high as they wish. Be fair and broad minded, when they ask for say 50 percent, be magnanous and give them another 10 percent.
All for it.
@openid.aol.com/users/110:
As a Californian, my tax rate (including state income tax) will jump from 43% to about 56% just under the current 2013 laws which sunset the Bush tax cuts and then slap on new Medicare taxes. I can tell you that this feels punitive to me. But you tell me how high my tax rate can be before you’d agree it was punitive? I earn a good income living in an expensive area. No one would mistake my small house on a tiny lot for a mansion. I don’t have a yacht or a Bentley or a private jet. A police or fire chief my age can retire with a COLAed pension and health benefits that would take me $millions of savings to replicate. Most people in the private economy don’t have that – some of us, because we’ve lived below our means for decades, do. But I’m to be punished as “rich” by your tax regime while the pensions of unionized public employees are defended to the last penny by you guys?!?
Your higher tax rates devalue decades spent developing my human capital, while doing nothing at all to the vast wealth of liberal elitists like Buffett, who won’t pay a dime of new tax on the $47+ billion of his fortune that he chooses not to take cap gains on each year. But answer me this, even if you don’t give a crap about devaluing my human capital as a matter of principle, as a practical matter, how high do you think you can raise my tax rate before I simply lose the motivation to continue working? What about someone just like me but 30 years younger and making a career decision, looking at my situation – what do you think it’s going to do to his/her motivation? Or don’t you give a crap about motivation? Is the goal to have a maximum income level or maximum wealth level beyond which high achievers should just retire and accept a uniform mediocrity? Seesh, Larry, a Canadian or a Frenchman pays a lower tax rate than I do right now, and all you guys can come up with is to keep jacking it higher and higher for less and less money.
I won’t be directly affected by today’s latest brainwave, the AMT 2.0. I suspect I’ll be indirectly (and negatively) affected, though. But even though this tax won’t affect me, I look at the amount of revenue projected (perhaps $18 billion / year) versus the trillion-dollar budget deficit and I’m thinking, you guys have got to be fraking kidding me. So your brilliant plan is to make the world’s most complex and inefficient tax code even more complex and inefficient in an effort to squeeze the last dregs of revenue out of fewer and fewer people? This is why it looks like it’s just a punitive and political measure and not a serious revenue raiser. And o yeah, good luck collecting that revenue – after Clinton’s tax increase, revenue (from the tax itself) came in at just 1/3 of the CBO’s static scoring, because, o yeah, incentives matter and behaviour changes. Doh, who’da thunk it, huh?
If you think we need to raise revenue for real, go ahead and be brave and put something out there that people will actually feel, and that will actually raise revenue. Tell us you want to repeal the Bush tax regime on everyone (not just a few people). Tell us you want a VAT. I won’t hold my breath, because I think that Democrats know if they put that message out there, and people are confronted with the true cost of all the government programs that Democrats want, they might just balk at the price and ask for more limited government, in keeping with what they think they, and not someone else, can afford.
the Country can not tax its way out of debt or into prosperity. It ain,t going to happen. Never has and never will. Must get serious about spending. If the Pres.. and Congress don,t get serious in say 2 years then i would say we are going to have a depression that will last for a long time.
Obama is setting up the contrast with Republicans for the nation to see. He thinks that shrinking the size of the government is a bad idea, so to him the only acceptable way to balance the deficit is to raise taxes. The Republicans (or at least the Tea Party component of the Republicans), on the other hand, believe that the government is too big, so they want to cut spending rather than raise taxes. These fundamentally different views of where we should make compromise impossible. I hope that the public is able to see that what is at issue in 2012 are these two contradictory views about the size of the government and avoid being distracted by irrelevant sideshows.
nohype,
absolutly, the TEA PARTY ARE MADE OF EVERY DAY PEOPLE AND THEY CAN SHOW ANY OF THE CRUMBLING DEMOCRATS HOW TO ROLL A BUDGET, BECAUSE IN A FAMILY THAT IS THE FIRST RULE TO GET THINGS RIGHT, TO KNOW WHEN TO SPEND AND WHEN TO PAY, IT IS AN HONORABLE WAY TO GET A HIGHER STANDING AND RESPECT FROM THE OTHER MEMBER OF THE FAMILY,
SO MUST THE GOVERNMENT BY IT’S LEADER THE PRESIDENT TO SHOW A HIGHER RESPECT OF THE PEOPLE’S MONEY, WHICH IS NOT HIS OWN TO FREELY SPEND ABROAD OR ON MULTIPLE SERVANTS HIRED BY HIM IN GOVERNMENT JOBS PAID AND UNIONIZE BY THE PEOPLE OF AMERICA,
WHICH IS UNFAIRLY BALANCED BETWEEN CIVILIANS AND GOVERNMENT LABOR.
@nohype: You can’t separate the debate about the size of government from the debate about how to fund it, at least, not if you’re on the side of the debate that wants more government. Obama’s own deficit commission produced recommendations that could actually have worked and would have raised revenues, but he round-filed them. Obama has squandered the opportunity to clean up a byzantine tax system and fix entitlement programs that have been ticking fiscal bombs since before he was old enough to vote!
JFK had a seriously different approach to taxation policy than Obama…
http://www.wnd.com/news/article.asp?ARTICLE_ID=39517
I do not see how attempting to spend on Infrastructure (a State Budget issue to start with) is going to get private goods consumption up in mass numbers as the construction business hires mainly seasonal machine pilots and work crews for temp jobs within a limited select pool. This isn’t the, “FDR” era where droves of men can just pick up a shovel and plant tree lines or power lines to rural areas at all, most of the labor force that are unemployed are technology/service economy focused jobs and putting them in “Shovel” ready arenas won’t produce a lick of anything within budget constrants for most workers when construction companies already have work crew pools of trained HVAC members to pick from and to retrain the unemployed for HVAC is a costly time allocation that takes months to cert and a hefty chunk of cash to enter most Tech Insitutions these days (My A+/Microsoft cert classes would have costed me 28,000 dollars out right and would have needed a loan, HVAC certs are costlier at about 32,000 or more pending school/state.)
@ Larry
No, taxes don’t have to be raised; and no, not virtually everyone acknowledges this. Revenue has to increase. You know, Obama being elected may be the best thing that ever happened to this country. It seems to me that almost every day another liberal fallacy is being disproved. Our current progressive tax system does not work. You can’t get the money needed to bring about any type of recovery by increasing taxes on the rich. There needs to be serious tax reform. And there needs to be some sort of consumption tax. I would recommend something like The Fair Tax, but congress, at least the liberals in congress, will not want to give up their power to tax their enemies and favor their friends.
Larry sure likes to claim everyone who is honest, or a true expert agrees with him. He loves to play the “appeal to authority” game.
Despite overwhelming evidence that tax increases won’t increase revenue to the extent claimed and will further hurt the economy, those followers of the progressive religion like larry insist it is the way to go.
Folks, please remember who you are dealing with. Mata, Word, Aye, and others have proven him wrong on this issue repeatedly and yet he comes back with the exact same talking points over and over as if they’d never been refuted.
As for obama, if he wants nothing, then one order of hot nothing coming up! His ploy to portray the GOP as obstructionist will blow up in his face.
Hard Right
This is one of my favorite businessman/financial commentator/guru. If Larry or any other liberals would like to see the cold hard truth, this is his congressional testimony from the other day. No sugar coating, no everything is going to be peachy, just the facts.
http://nation.foxnews.com/peter-schiff/2011/09/20/ceo-blows-away-congressional-hearing-i-was-fined-hiring-too-many-people
@openid.aol.com/runnswim:
These tax increases are not just for the billionaires which by the employ people, it will hit others. Increased security ‘fee’ at the airport, federal employees and I am not speaking about those on the hill that never get in the fray, an extra 1.4% taken from their paychecks to name a couple also in this bill is millions to help a law firm (name escapes me). Bet they represent Barry or have been bundlers. Barry is doing this only to use as a tool in his re election campaign. Just wait and see
I think you really need to put down the Kool aid before you fall and hurt yourself.
Give them NOTHING!!! They have proved that they can’t be responsible stewards of the money that we have already “given” them.
Cut all benefits to Congress! Reduce their salary in proportion to what they are worth monetarily based on the median income of the US worker. Anything more than that should be returned to the US Treasury… Then let’s see the Schmuers, Boxers, Rangles, Kerrys, Pelosis, Reids, Shakowskis, etc. like it!
NO NEW TAXES! CUT THE SPENDING!
Larry, when Obama first made your point to me he was soundly rebutted.*
No.
Doctors do NOT do unnecessary things just to pad bills.
If a patient is litigious a doctor might be extra careful about caring for them.
I used to know a woman who proudly boasted that she lived off of one lawsuit after another and that, as a result, many doctors refused to even see her.
The following is from Aug. 2009.
*White House’s transcript of Obama in Portsmouth, NH:
No more true than your allegation, Larry.
BTW, as you are STILL TWO YEARS LATER parroting old Obama mistakes, I wonder if Obama ever bothered to correct his own misstatements.
Hi Nan. I’m a doctor. I’ve been a doctor for 36 years. I know of what I speak. There have actually been peer review studies on this. I’ve given a number of clear cut examples before. It’s rampant. It’s pervasive. I don’t have the energy to go through this for the half dozenth time.
It’s not just Obama who thinks that we should pay for outcomes, as opposed to procedures. Pawlenty might not be conservative enough for some people on this blog, but he’s no Marxist. I gave references.
Anecdotes from the woman you cite are just anecdotes. Just for once, why don’t you give me a rich person anecdote. Some rich person who cheated on his income tax and cost the treasury $5,000,000, which pretty much is the same as 100 egregious welfare cheats.
California did malpractice reform decades before Texas. Same reform. Texas modeled theirs after California. It didn’t do one blasted thing to lower the cost of medical care or reduce the use of “defensive medicine” tests.
Hi Hard: As I have explained to you before, I am one guy and you are many. I NEVER get the last word. So I finally give up (as in the case of the present discussion), and then you declare that I’ve been “proven wrong.” Using this reasoning, my conservative counterparts who like the intellectual stimulation of debating on liberal blogs are “proven wrong,” simply because they are outnumbered.
– Larry Weisenthal/Huntington Beach CA
@Aqua:
That was interesting, Aqua. He explained in much more detail, but in a simpler way, what many of us know anyways. That is, that it’s investment that builds the economy. Consumption might be the backbone, or foundation, if you will, of the economy, but it will never grow the economy at the pace that investment can. This is where the fallacy of the left, that taxation and spending by government is equal to equivalent consumption from the private sector, is blown away.
When the government increases taxation, it takes money out of the private sector. In reality, not all of that money gets spent in an equivalent fashion to what the private sector would do with it, mainly because as that money is removed from the private sector, there is less of it, then, to invest in companies, businesses and ventures that could have a big benefit to the economy overall.
Think of it this way: Let’s say $1 more gets taxed, and then is used for consumption by the government, meaning that that $1 gets spent buying a product or service. Generally, businesses have a 3-4% profit margin built into the price of their goods or services. That means that out of that $1, only $0.03-0.04 per dollar grossed by a business is profit, which then can be re-invested into a company to expand and grow.
Contrast that with that same $1 not being taxed by the government, but instead, being invested by a person, group, or business, either through stock purchases, saving in a bank which allows the bank more to lend to a business, or any other investment scenario. When this happens, that entire $1 can be used by the business to expand and grow, which can create long-lasting jobs that in turn have such benefits as an increased consumption base, more $$$ available for reinvestment, and YES, even increased revenue to the government via taxation.
In order to get the same benefit to the economy from government taxation, $25-33 dollars in total would have to be removed from the private sector via taxation and government consumption, and even then that figure is all fairy-tales and unicorns because of government waste and the service to the debt. And then, you have the problem of that $25-33 and making up for the lost investment that money could have been in the private sector, as compared to what it is when the government takes it.
Consumption can keep a business afloat, and even grow it by a little. Investment in that business can expand it from a local, regional force into a national brand-name.
To Curt or whomever: I don’t know why #27 and #28 are both up. I initially posted #27 and then made a couple of edits. Instead of just making the changes to #27, it appeared as a new #28. This was unintentional. I certainly didn’t mean to double post. – Larry
@openid.aol.com/runnswim:
LOL! Sure you did, Larry. You’re just trying to make up for the disparity in liberal vs. conservative posters here!
J/K
@openid.aol.com/runnswim:
I got rid of #28 for you.
@johngalt:
If Larry says everything twice, does that mean he’s outnumbered half as much?
If so, does that mean he’s wrong twice as much too?
🙂
Hi John. So how ’bout that Notre Dame game? I posted a comment on the annarbor.com website (the Ann Arbor News no longer exists; it’s now just annarbor.com), which got the “most popular” award, of all the post game comments (103 “likes”). Scroll down to the end of the article to “Comments” and I’m at the top of “Most Popular.”
http://annarbor.com/sports/um-football/denard-robinsons-heroics-have-ann-arbor-and-country-buzzing-about-michigan-football/
Commenting on sports sites is often more rewarding than commenting on political sites.
– Larry W/HB
Hi Aye. Thanks (and touche’)
@openid.aol.com/runnswim:
Denard last year put himself solidly into my grouping of favorite UM players ever. After that game, he is now in my top three behind only Woodson and Howard. He isn’t a great QB by any means, but he is a great player. 948 total yds, 8 TD’s and 2 wins in two years. Amazing!
I liked your comment as well. Living in Indiana, I don’t live around too many UM fans, as you can imagine.
Larry
Poor Rich, he’s been missing in action around here for a while. Notre Dame has beaten someone this year though, haven’t they. I think it was a High School JV team. :-0
John/Rich (apologies to Curt for using bandwidth for personal stuff): My all time favorite UM player is Barry Pierson. He almost single handedly won the Upset of the Century and he was a true student athlete, 6 feet/175 pounds. No post-college pro career. Sort of the idealized epitome of the way we like to think college football ought to be.
http://www.stignacenews.com/news/2009-11-19/Sports/Barry_Piersons_Role_Recalled_in_1969_Wolverines_Up.html
http://www.youtube.com/watch?v=Vskt2_Kd9cQ
– Larry Weisenthal/Huntington Beach CA
Given up? You keep posting the same arguments over and over about raising taxes on thread after thread. You sure have a funny idea of what giving up is. Larry, you were proven wrong by facts and not by the number of posters that disagreed.
Hi Hard (#36): Mata has twice provided a link to the most comprehensive analysis of the effects of tax cuts on treasury receipts — looking at every single bill which either raised or cut taxes, since, if memory serves, the late 60s. Every tax hike raised treasury receipts and every tax cut reduced treasury receipts. The largest tax cut in history (Reagan’s initial/signature cut) cost the treasury the most money. All of the post-WW II presidents, until Reagan, reduced the debt:GDP ratio, despite decades of massive federal spending on the GI Bill, Marshall Plan, Interstate Hwy system, Great Society, Medicare, Vietnam War, massive expansion of the NIH/War on Cancer, etc. Debt to GDP ratio got paid down by 75%, but, in the 12 years following the Reagan tax cuts, Debt:GDP ratio doubled.
In addition to this, I posted links to the opinions of about 10 conservative economists, all of whom agreed that tax cuts always cost the treasury money and contribute to the debt. I have on many occasions challenged my conservative friends on this blog to provide a reference to a credible conservative economist who defends the proposition that modern-era tax cuts have ever paid for themselves, through generating sufficient economic activity to compensate for the reduction in tax rates. I am still waiting for this.
Despite this, you keep repeating the charge that I am merely regurgitating “talking points” and have been “proven wrong.”
Did you note, in the debate over allowing the Bush tax cuts to sunset, last fall, not a single Republican offered the justification that keeping the tax cuts was necessary to avoid adding to the deficit. Instead, they all offered Keynesian arguments about how terrible it would be to raise taxes in the middle of a recession.
If you want to solve the deficit problem, it will take tax increases, along with spending cuts. A large component of the current debt crisis has been past tax cuts, as proven by the very data which Mata provided, and as supported by the links to the conservative economists which I provided.
We will see tax increases. No matter who wins the next election.
– Larry Weisenthal/Huntington Beach, CA
@Larry:
One thing seems to be missing in all of the left’s calls for raising taxes – actual numbers and specifics. How much do taxes need to be raised to have any meaningful impact, other than to increase unemployment?
Bill Whittle breaks down Iowahawk’s analysis of how much wealth the government can take:
And I did a quick analysis if we want to have every American pitch in and do their share to pay off the debt:
http://brother-bobs-blog.blogspot.com/2011/07/call-for-higher-taxes-part-iii-time-to.html
Both are quick back of the envelope analyses, but sadly Iowahawk and I have both put more effort into and take this issue more seriously than Obama or Geithner do.
What have you got?
Hi Brother Bob, I’m in agreement with you. Obama is trapped by his ill-advised campaign promise not to raise taxes on families making less than $250K. My favored approach would be to sunset ALL of the Bush tax cuts and make up the balance with spending cuts. I’d raise social security retirement age by 1 year ever three years until it was at 70.
Few other things, also.
-Larry Weisenthal/Huntington Beach, CA
@openid.aol.com/runnswim: You said:
Name one.
@openid.aol.com/runnswim: You said:
Really?
So the EPA putting in place regulations that drive businesses out of existence HELPS the economy?
Banning drilling in the Gulf, which if allowed would give us millions of new jobs immediately HELPS the economy?
Obamacare forcing small businesses to provide health coverage to part time employees HELPS said small businesses and thus the economy?
I personally know of four businesses in the town where I live that have gone out of business because of Obamacare and EPA regulations.
Yeah, that helps the economy alright.
@openid.aol.com/runnswim: You said:
This is your opinion, not a fact.
Larry, how much of the deficit will we erase by letting all of the Bush tax cuts expire? How much will the deficit get paid down by all of the new proposed tax increases? What will the impact of these increases be? I know Obama and Geithner prefer to stay away from real numbers, but has anyone shown what these tax increases are actually going to accomplish?
@Brother Bob:
I don’t know about Obama’s plan, but Larry’s idea of letting ALL of the Bush tax cuts expire will only get the government around $350 Billion a year or so. And that is assuming absolutely no negative results to the economy from those rates rising. Larry then says he’d make up the difference with spending cuts. Really? Considering that the current annual deficits are well over $1 Trillion, the spending cuts required would need to be quite hefty to eventually get revenues equal to spending.
And, as I said above, in response to Aqua’s post, taking that $350 Billion out of the private sector, ANNUALLY, would have a very negative effect on the economy due to that much less money used, in part, for consumption, but mostly from the lack of investments in businesses.
No, tax cuts aren’t the answer. There are other things that can be done(or not done) to spur the economy into growth, which lowers unemployment and results in higher revenues for the government. Larry wants to keep kicking the dog (economy) when it’s down.
Hi Antics: With regard to Republicans agreeing (publicly) that tax increases are needed — every bipartisan commission/committee convened/formed in the past several years has recommended a combination of tax hikes and spending cuts. I’m unwilling to dig out all of them, but here are three of the most important (all of the following include a balanced composition of Republicans and Democrats):
National Debt Reduction Commission:
http://www.fiscalcommission.gov/sites/fiscalcommission.gov/files/documents/TheMomentofTruth12_1_2010.pdf
Bipartisan Policy Commission:
http://bipartisanpolicy.org/sites/default/files/FINAL%20DRTF%20EXECUTIVE%20SUMMARY_0.pdf
Peterson-Pew Commission:
http://budgetreform.org/sites/default/files/Getting_Back_in_the_Black.pdf
With respect to your businesses allegedly going out of business because of ObamaCare and EPA regulations: Any business put out of business by those things were not destined to be long for the world. Good grief, ObamaCare is very likely to be killed off by the next President and Congress and ObamaCare provisions won’t even phase in until 2014! And those cowardly businesses just gave up without even seeing what the next election would bring?
Businesses are failing because of lack of customers. That’s the number 1,2,3,4, and 5 reasons.
Don’t take my word for it; ask the CEO of Google, who knows a little bit about the business climate and what it’s going to take to get it off of square 1:
http://abcnews.go.com/Politics/google-chairman-government-strategy-spending-cuts-ludicrous/story?id=14548966
Now, I’m guessing that you won’t agree with him (or me). I know that you’ve thought this through and you have come to your own conclusions. I think that your conclusions and opinions are perfectly legitimate. You are neither delusional nor looney. You make reasoned arguments, as opposed to spouting off talking points.
I would simply settle for an acknowledgment that one doesn’t have to be a Marxist/socialist/promoter of class warfare to be of the opinions that (1) the long term debt problem will require increased taxation and (2) the short term economic problem could benefit from more short term government spending.
Hi Brother Bob, The figures I recall are that sunsetting all of the Bush tax cuts would raise $2.1 billion over 10 years. One third from those making more than $250K. Two thirds from those making less than $250K.
Getting back to Antics: Supply side economics is the emperor’s new clothes precisely because of the data I cited in #37. Tax cuts never pay for themselves. Supply side economics states that tax cuts generate sufficient economic activity to pay for the money lost to the tax cuts. This was a viable theory in 1980 which has now been proven not to hold water. So I’d say that it rises above the level of opinion to approach fact.
Hi John (just saw your latest): No, I don’t want to kick the economy while it is down and neither does Obama. We’ve got a short term recession problem and a long term debt problem. The best thing we can do to solve the short term recession problem is to do what Eric Schmidt (Google CEO) suggests, which is pretty much the Obama plan. Personally, I’d put virtually all the stimulus money into infrastructure spending, but too many cooks spoil the broth. Down the road (last half of the decade) we’ll need tax increases to pay for the money that we spent on the infrastructure (or whatever) and to get back on a debt reduction track.
P.S. Here’s a comprehensive, recent (as in yesterday) NYT article on the impact of ending the Bush tax cuts:
http://topics.nytimes.com/top/reference/timestopics/subjects/t/taxation/bush_tax_cuts/index.html
By the way, I read in the article that Alan Greenspan calls for ending all of the Bush tax cuts. Add one more conservative to the list of those agreeing that increased taxation is required to deal with the debt problem.
– Larry Weisenthal/Huntington Beach, CA
@Aqua: #23,
Re. Schiff – It’s a pleasure to listen to someone who actually knows what he’s talking about on this subject, speaks from a foundation of experience seeped in the reality of where the rubber meets the road, and who delivers his succinct and substantial presentation without a Teleprompter.
On the other hand, I find Buffett an annoying and hypocritical oaf. His track record on taxes is anything But what he now pretends. Mr. Invest-in-Berkshire-Hathaway-for-the-long-term so that you too can side-step capital gains has a record minimizing his tax burden, but now that he can pull a quid-pro-quo with Obama, suddenly tax increases are a good concept.
Buffett has not made one single intelligent statement about either the economy or job creation, in years. He and Obama deserve one another, but American taxpayers don’t deserve the lies.
@Larry:
Consumption isn’t the problem:
And your tax increases bring in $2.1B over ten years – isn’t that (off of the top of my head) what we borrow every month or two? How is this helpful in any meaningful way?
Hi Brother Bob,
Thanks for correcting my brain burp; I meant $2.1 trillion, not $2.1 billion. The NYT article implies that the real number is North of $4.6 Trillion (effect of either continuing or rescinding the Bush tax cuts).
Consumer spending is weak; back to school sales were disappointing and this is a strong predictor of holiday sales. Consumer confidence is low and it just crashed in August:
http://www.conference-board.org/data/consumerconfidence.cfm
Here’s a much more nuanced/complete consideration of consumer spending trends:
http://blogs.reuters.com/reuters-money/2011/09/20/spending-less-could-make-recession-a-self-fulfilling-prophecy-analysts/
Businesses won’t hire until they are sure that long term demand will be sustained at a much higher level than it is right now.
– Larry Weisenthal/Huntington Beach CA
so in all of this, the GOVERNMENT ‘s own busyness is booming, and along with the UNIONS
they are having a ball, they are hiring employees, and all this time using the TAXPAYERS’S MONEY,
WHILE the PEOPLE are having problem to find a job because the busynesses are being muzle by over loaded GOVERNMENT’S INTRUSION AND REGULATION,
THAT IS COMMUNIST MARXIST IDEALISTIC GOVERNANCE,
which happen by electing LEADERSHIP who’s goal is to change AMERICA FOREVER,
a mentality of leadership going complete on the opposit of AMERICA’S FOUNDERS
THAT THE PEOPLE ARE THE DECIDER OF THE MARKET AND CREATIVITY WHICH BRING THE WEALTH IN THIS COUNTRY, AND AS IT IS NOW THE PEOPLE DECIDED TO WAIT FOR THE NEXT ELECTION TO GET THE BALL ROLLING AT THE RIGHT ANGLE WHICH MEAN AHEAD INSTEAD OF BACKWARD AS THE GOVERNMENT IS DOING, WITH INTENT TO FOLLOW HIS AGENDA OF DESTROYING AMERICA FOREVER,
SO AMERICAN BETTER GET SERIOUS ON NOVEMBER THE YEAR 2012,
THIS WILL BE THE LAST CHANCE, TO LIVE OR TO DIE FOR AMERICA
The government does not create private sector jobs. It can, however, destroy them.
WM T Sherman
yes understood,
bye