Billionaire and close Obama ally Warren Buffet has been waking waves for some time advocating for higher taxes on the rich. And the notion of a very rich man calling for much higher taxes on himself makes for good politics, to be sure, especially for those who want to raise taxes.
But as policy, it wouldn’t solve anything.
(CNSNews.com) – Taxing millionaires and billionaires more – a position advocated by billionaire Warren Buffett and President Barack Obama – won’t make much of a dent in the national debt or the record federal budget deficits, a new study finds.
“Even taking every last penny from every individual making more than $10 million per year would only reduce the nation’s deficit by 12 percent and the debt by 2 percent,” the non-partisan Tax Foundation’s David Logan writes.
“There’s simply not enough wealth in the community of the rich to erase this country’s problems by waving some magic tax wand,” said Logan.
As I’ve said many times, increasing the taxes on those making $200k(individual)/$250k(joint) will not make a real dent in the deficit. And, on top of that, the consequences involved in doing such a thing are uncertain, but likely to be negative towards the economy, at a time when the push should be to help it as much as possible.
The fact that the insistence is to increase taxes on a part of the population belies the real intention of “redistributing wealth”, and not the stated goal of helping bridge the spending/revenue gap. Larry W, at least, is much more honest in this regard with his support for increasing EVERYONE’s taxes. Anyone who supports increased taxes on certain economic classes is engaged in class-warfare tactics only and more concerned with ” punishing” the “rich” than in any real address of the deficit itself.
If you were to be “fair”, increasing the taxes on the rich should have a matched reduction in benefits for the poor. No one should be immune from doing their share and the other side would be, then you would have both end of the spectrum advocating for less spending 🙂 And that my friends is called, “Sharing the pain.”
I’ve been saying the same thing since Obama’s “Class Warfare” started. Even if we take ALL of their money….it would not even put a ‘dent’ in our deficit. And I’m no rocket scientist….
Rob: Few among us would oppose fairness, but how does one define it? How does one compare a family making $500,000 with one making $50,000? Would it be “fair” to tax them both at 10%. Are the effects commensurate? Hardly! Institute a progressive tax – in effect, “sharing the pain: more equitably? What about a single man making $50K and a family of four making the same? Should they “share the pain” equally? And, if so, how do you determine that? And what happens, when the man who makes $500K (or $50 million) begins using his money to influence the tax code in his own favor?
I’m not disputing what you say, just pointing out that “fair” is a loaded word and that the best intentions can produce results we might not anticipate or even like.
Johngalt: There’s no doubt the economy’s woes involve much more than tax policy. Stopping and reversing job loss and restoring America’s manufacturing base remain the best, perhaps the only real remedies. It would have been far better to have prevented these problems before they started (for one thing by following Ross Perot’s advice during the ’92 presidential campaign) for the multinational corporations which shipped our jobs and factories overseas are unlikely to cooperate with plans that would force them to reverse the process, especially when these will adversely affect their bottom lines.
This isn’t to say that tax policy shouldn’t be changed. The Republican mantra that “we have a spending problem, not a revenue problem” is patent nonsense. As the public discovers the ultimate aim of this campaign and the right’s wrecking crew approach to social policy, odds are they’ll reject both (witness current events in Wisconsin and Ohio).
Two other Republican talking points involve “class warfare” and “redistributing wealth”. It’s astonishing that the right has been able (so far!) to use these terms with impunity, because as campaign weapons they’re definitely two-edged swords. When the public recognizes that Warren Buffet was right about class warfare and that it and wealth redistribution (upward) have been going on for a long time, their reaction is likely to be just as forceful.
Why do conservatives find the data about wealth and income inequality so threatening? In general Americans are a fair minded people. The mere fact of inequality is unlikely to arouse their resentment, but the way in which that inequality has come about is a different matter. This is why conservatives have reacted so vehemently against Warren Buffet’s remark about “class warfare”.
@AJ Hill:
We have responded due to the outright dishonesty and rank hypocrisy he has displayed in his comments and actions.
It would also be nice if instead of holding him up as some kind of hero, the left would look behind his real motives and see he is actually the type of rich predator they ALLEGEDLY despise. As I said before, all one of the “rich” has to do is make liberal noises and the left will excuse his actions no matter how disgusting.
Why do leftists feel the need to lie and distort “income inequality” data? One would think when the facts don’t support their beliefs they would realize their beliefs are wrong. Instead they just pretend it doesn’t prove them wrong and attack those who point out the otherwise.
AJ, it’s pretty clear you’re just a marxist troll. I say that because no one could be as dense AND as dishonest as you have been unless your goal is to antagonize and disrupt. Really, you just aren’t smart enough to play on the same field as the people here. Go back to KOS, huff, or DUNG where they must worship you as head idiot.
@Hard Right: Despite what your nasty, interminable trash-talk reveals about you as a person, the truth or falsity of Warren Buffet’s statements have nothing to do with his character. In fact, to any objective observer your reliance on ad hominems suggests that you lack confidence in your own arguments – and with good reason. Wealth and income disparity in the United States have been documented convincingly by numerous academic studies as well as by official surveys from the Bureau of Economic Analysis and the U.,S. Census Bureau, so it’s fair to ask on what basis you make your claim. The idea that all of these various independent sources have been co-opted by some vast liberal conspiracy is nearly as ludicrous as the similar claim that conservatives make about global warming.
Since you ask, my motives for continuing to post on this site are complex. It’s an effective way to learn the latest right wing talking points, since you all memorize the same ones and don’t confuse the issue with original thought.
In addition, I confess, there’s a certain shameful satisfaction to be had in poking a cage full of vicious animals with a stick and watching them snap and snarl. I’m not proud of this, but there you are. To be blunt, you’re funny.
Finally there’s the hope, somewhat faded by now, that I’ll encounter someone with enough wit and acumen to make debate worthwhile. So far, in spite of a near miss, I’ve been disappointed; but, as John Stuart Mill noted, “Conservatives are not necessarily stupid … .” In other words, there’s room for hope.
Thanks for yet another grin and demonstration of your personal flaws in social civility, Hill’o’beans. I suppose the fact we actually think you’re quite the toy yourself zips thru your cranium, nonstop. You know, that poking the cage with a psycho critter inside bit?
There’s always been wage gaps… as well there should be. Rewards for achievements and all that jazz. But then, leveling out the wealth via redistribution is a relentless quest for you socialist types. Nor has the amount of wealth controlled fluctuated much over the past decade… save in the years which you plaintly advocate we revisit… aka the Carter recession. But then that’s what happens with inflation and devaluing of assets when the economy is stifled by idiotic fiscal policy. Thanks… but you can traipse that down Carter memory lane without me, thank you.
It’s interesting to note that far more have joined the various “middle class” status of income over time – that loosely defined category that you lib/progs insist upon using to pigeon hole people, so that you may more effectively wage your class warfare. Much of that can be attributed to access to investments available to so many more with technology, ESOPs and 401Ks. Oh yes… but then you also whine that the poor don’t have the advantage of the more expensive, faster computer technology. Guess next you’ll be wanting to spread those tools around on the taxpayers dime as well.
The Internet’s a big world, Hill’o’beans. While we enjoy prodding you as much as you think you are entertained in the reverse, I have to say you may find it more conducive to your blood pressure to hang elsewhere. You hit the meltdown stage pretty rapidly, and start parroting the same ‘ol same ol’ at a rapid rate of speed. It must take quite a bit of negative energy to figure out new ways to demean those around you. Trust me, we’ll barely notice you’ve gone.
@AJ Hill:
Those “talking points” that you suggest that I use are nothing of the kind, in fact. They are, instead, merely catchphrases that have become popular in describing the ideology of the liberal/progressives.
You also commit an error by using “conservative” and “Republican” interchangeably like you do. The establishment GOP(Republicans) are hardly conservative in nature, and many of us true conservatives here at FA readily find fault with much of their actions, just as we do the liberal/progressive left. In essence, the establishment GOP act more like a “lite” version of those liberal/progressives than in anything resembling a conservative.
There are many reasons companies shipped, and continue to ship, jobs overseas, AJ, and chief amongst these is regulatory and taxation policies that inhibit growth, at the least, and profitability, at the worst. As the regulations and tax burdens become continue to add cost to companies’ products and services, the demand for the same from them by consumers decreases. Eventually, those companies are left with an option of moving various parts of their operations overseas, where the tax burdens and regulations are less onerous, allowing them to regain a measure of profitability. Profit is not a bad thing, AJ. It’s the main compulsion for companies to do what they do.
Reduce the barriers to companies that add cost to their products and services and my guess is that you will find jobs returning, or at the very least, stop others from moving operations overseas.
This was refuted during our discussion on raising the debt ceiling, AJ. I am reluctant to go into every point presented during that discussion, mainly due to the length this post would take on then. Here are the main points, though;
-One, to understand why conservatives suggest the deficits are due to spending problems, one must understand what is meant by ‘baseline budgeting’ that the government uses, both on an annual basis for increasing spending, and for projections for government spending for the future(typically in ten-year blocks). ‘Baseline budgeting’ is, essentially, an assumed increase in budgeting for every dept., agency, and their associated programs (all non-discretionary spending) of around 4-7% from the previous year. For the ten year period following this year, $9.5 Trillion in additional spending will be added to the federal government’s budget. The “deal” that was agreed to cuts, at most, $2.5 Trillion of that spending, leaving $7 Trillion in new spending over and above the current federal spending amount of $3.8 Trillion(projected) for 2011.
-Two, keeping in mind that $7 Trillion in new spending, even a FULL return to the Clinton-era tax rates would only net $3.4 Trillion in additional revenues over that ten years, with the bulk of it, $2.4 Trillion, coming from those making less than $200k/$250k. Those above would only net $700 Billion. These figures are from the CBO’s scoring of the extension of the Bush tax cuts, and their “cost” to the government over the ten year period starting from last december. It is important to keep in mind that they calculated these figures based on extremely rosy GDP growth rates that we haven’t seen this year, and are unlikely to see in the near future. So, the real “cost” of those tax cut extensions is likely to be considerably less, but I’ll use those figures for lack of knowing that real “cost”.
-Three, taking $3.4 Trillion away from that $7 Trillion in new spending amounts, leaves us with $3.6 Trillion in new spending amounts. We are still talking about, on average, $360 Billion per year in deficits per year over that ten years. That doesn’t sound so bad, right? Well, it doesn’t, but only because the entire picture isn’t being looked at. Remember, we are starting from a point of a $1.5 Trillion deficit. How does that play into it? Well, let’s assume no “deal” on spending “cuts” were reached and the debt ceiling isn’t an issue. In order to keep those deficits at $1.5 Trillion, revenue growth rate must exceed that of the assumed spending growth rate, because revenue is starting at a lower point than spending is. For example, federal spending, using baseline budgeting(and an average 4% increase), will be $3.952 Trillion(projected). Subtracting $1.5 Trillion from that, we get $2.452 Trillion. Now, in order to just maintain that $1.5 Trillion gap, revenues would have to grow by 6.6% from a starting point of $2.3 Trillion or so. And this would continue for the next ten years, with the percent growth required by revenues dropping slowly, but requiring an average annual growth, over a ten year period, of 5.5-6% per year. Not very likely.
-Four, if the spending cuts, and tax increase, numbers are added in to their respective categories, from starting points of $2.3 Trillion for revenue and $3.8 Trillion for spending, the picture becomes a little clearer. Extrapolating out the $3.8 Trillion spending figure, along with baseline budgeting increases for ten years, and then subtracting the “cuts” reached in the “deal”, we arrive at a figure of $45 Trillion in total spending for that ten year period. Now, to just maintain that $1.5 Trillion annual average deficit number, revenues must, then, be at least $30 Trillion over that ten years. Subtracting the baseline $2.3 Trillion times ten years, of $23 Trillion, $7 Trillion is left over(the same as the spending increase). Without the tax increase(expiration of ALL Bush tax cuts), the growth in revenue require to attain that $7 Trillion in revenue is 6% annually. Now, if ALL tax rates reverted back to Clinton-era tax rates, which the CBO scored at $3.4 Trillion, the remaining $3.6 Trillion would be the required total revenue gain for that ten year period. It would require an annual growth rate of 3% just for revenues to reach that $30 Trillion figure of revenues over ten years, in order to maintain the current deficits at $1.5 Trillion. Again, unlikely considering the current economy, not to mention the negative effects on the economy from an increase in taxes.
-Five, in order to reduce the deficits, say, to something seen in the Bush years, which averaged around $400 Billion, revenues, total for a ten year period, would need to equal roughly $41 Trillion. Subtracting the $23 Trillion, plus the tax increase amount of $3.4 Trillion, we end with roughly $14.6 Trillion in additional revenue. How high a percent of growth in revenue is needed to attain that new revenue amount?
So, the only conclusion that can be drawn, referencing the above numbers, is that federal spending is THE ISSUE, in regards to the deficit/debt problem. It is not a revenue problem, nor is it a revenue problem based on increasing taxation on the “rich”.
You are right about one thing, though. When the public discovers that in order to have a hope of salvaging this country, economically, that serious, actual cuts need to be made to federal spending, and that both SS and Medicare will be in the crosshairs as well, that they will be up in arms over it. Both in realizing the reasons why, and the actual fact of seeing their ‘bennies’ drop. There is, after all, only so much money you can squeeze from people, and the amount needed to really address the debt/deficit issue is more pain than people will take.
I’ll leave your other comments and points to be addressed later.
@AJ Hill:
Interesting, but not surprising, that you choose someone like Mill to quote. His own economic theory of an ideal economy included “worker-owned cooperatives”, and he opined that socialism was a workable option to capitalism. So, excuse me if I accept whatever Mill has said with a large dose of salt.
You forgot the shot of tequila….. LOL
@MataHarley:
Maybe in my younger days, Mata. I’m done drinking anything other than the occasional beer, and by that I mean maybe, possibly, 1 a month.
@AJ Hill:
Let’s first address the term ‘talking point’. That term has several different connotations associated with it, including the following;
-An extremely persuasive point that helps support an argument.
-An interesting topic, or subject, for discussion.
-An oft-repeated phrase within several unassociated discussions.
Of course, when discussing the term politically, it is often referred to as a point of discussion to be repeated often in order to persuade discussions in one’s favor. Additionally, it is often described as a point that is disseminated amongst various supporters in order to spread the word(idea) to a larger audience.
So, the term itself is not negative, however, I believe that you intended it’s use as a negative, and that you essentially accused the “Republicans” of doing that which the liberal/progressives in the Democratic party are very adept at. One needed only witness the plethora of comments from the various liberal/progressives, following the debt ceiling debate, of the TEA Party “holding the country hostage”, or some similar form of phrase. What is most interesting is that you see a catchphrase as somehow being of this negative quality in regards to the term “talking point”.
But, let’s get on with the rest of that paragraph;
The term ‘class warfare’ applies to any conflict within a political system between two or more groups of people within social or economic categories. Liberal/progressives are deliberately instigating conflict between the various economic classes, just as they have done with race, age, gender, sexuality, etc.
Here, though, we are discussing economic ‘class warfare’. I could reprint the various statements made by the liberal/progressive elites demonizing the “rich” and pandering to the lower economic classes, but what’s the point. I know they do it. You, apparently, are either so blind, or extremely ignorant, as to their rhetoric and the reasons behind it.
The term “redistributing wealth” is not just a ‘talking point’ by conservatives. Obama himself used the term to describe his intentions during his campaign in 2008. Or, did you forget his interaction with Joe the Plumber? It is generally accepted that any transfer of wealth from one person, or group of persons, to another person, or group of persons, by social mechanisms such as taxation, monetary policies, welfare, and others, is, in fact, ‘redistributing wealth’. It happens. Or did you think that those lower income workers are receiving more back than they paid in taxes because the government is generous? There is also, of course, the example of retirees receiving much more than they paid in to Social Security(and even if you include a modest interest accumulation) that is paid for solely by younger workers. Do I need to give more examples?
So, what we have, then, is two catchphrases used by conservatives to describe the actions, intentions, and ideology, of liberal/progressives. Actually, regarding your words from above, if the public, in general, had a clue as to the reality of the economic situation, it would be both Republicans and Democrats that would be tarred and feathered. Democrats for instigating such disastrous actions and policies, and Republicans for both joining in the instigation, and/or, letting them get away with it. You can hero-worship Buffet all you want, but just know that you are then being guilty of willful ignorance in supporting his claims. Buffet is misleading at best, or guilty of saying falsehoods at worst. We could go into a big discussion as to why I say such things about him, but that was all beat to death in that other topic.
Conservatives do not find the data about wealth and income inequality threatening. It is what it is, and in general, is one of the primary mechanisms that fuels a capitalist society, from those wishing to rise up, to those providing the means for others to increase their own economic status, and those providing the energy(wealth) that drives a growing economy.
Yes, Americans are, generally, a ‘fair minded people’, and inequality is generally only addressed when it is present in keeping a group, or groups, down in some form or another. But you aren’t talking about inequality in opportunities, which is one of the principles our country was founded upon. No, you are interested in the inequality of the outcomes of people’s lives, seeking to address the shortcomings of one group of people by taking from another group of people. Never mind why those in the lower income brackets are where they are. It doesn’t matter WHY those people haven’t made as much of their opportunity as those in the higher income groups.
For all of your beating around the bush about it, the one, simple idea that your comments have alluded to hasn’t been mentioned by you. That is, you want this;
And to do so you have even brought in the idea that the founding fathers somehow agreed with that maxim. Funny, and sad, that your ignorance of the founders and their works would lead you to that conclusion. I could ask you how well that maxim has worked for every country that tried it, but why bother. I know the answer, and you, likely, will dismiss it out of hand, or completely ignore it. I’ll leave you with this;
Who is Hill’o’beans to be lecturing… er, demeaning… anyone about “talking points”? He’s a walking socialist manifesto of talking points… LOL
Well, jg… if you and the evil distilled liquids have come to a parting of the ways, then I’m pleased you’ve tamed some potential demons. But sure is a waste of perfectly good salt, ya know…. hopefully coarse, Kosher or sea salt.
@AJ Hill:
Like I said, a marxist troll.
Again you duck facts because you know I’m right. Buffett wants to bring back the “death tax” . His reason for doing so is to grab the property that “middle class” people cannot afford due to those taxes. Again, you utter not a word about it. Why? Because he spews the same class hatred you do. That just goes to show you are a dishonest phony and (your favorite word) a hypocrite.
You stand for no one other than yourself and your narcissism. Really, debating you is like clubbing a baby seal-no challenge at all.
I also wanted to point out that you have helped our cause. By throwing out such easily debunked talking points anyone passing through this site will again see that all leftists have to offer is unthinking hatred, envy, and authoritarianism. Actual ideas, rational thought, or superior reasoning abilities? That belongs to Conservatives. If you had half the intellect you think you do, you’d understand this and that the only one being played with, is you.
@johngalt: As I write this I’m listening to an address by Arthur Brooks, the founder of the American Enterprise Institute. A brilliant and accomplished man, Brooks speaks with the conviction and passion of the true ideologue: conservatives aren’t just correct about some issues, they’re right on every conceivable point. AEI has studies that prove these things. The moment I hear anyone, left or right, speak in these terms, I know that I’m listening to a captive mind, a mind so dominated by a single idea or viewpoint that it’s incapable of rational judgment. No one, no ideology possesses an exclusive claim to the truth and any “scientific” study that purports to show this is just manipulating data.
In fact, the longer I listen, the more I realize that Brooks’ keynote address consists of little more than the same tired “catch phrases” (as you would term them) that are invoked by every right wing oracle from Rush Limbaugh to the pages of the Wall Street Journall. The problem with these tropes is that they truncate the thought process. By invoking the associations of armed conflict and state allegiance, for example, “class warfare” evokes inappropriate images and emotional responses that short circuit the kind of reasoned analysis our problems ought to receive. That’s why I refer to them derisively and try, as much as possible, to avoid using them.
As for misusing the terms “conservative” and “Republican”, I can only cry mea culpa. I do recognize these as distinct groups with different – sometimes very different – ideas and approaches to things; but in practice I often ignore those for the sake of convenience or merely out of carelessness. If you catch me doing so in a context where it matters, feel free to call me on it.
The Brooks speech is over and it’s past my bedtime. I’ll have to address the rest of your remarks later. I’d like to take this opportunity, however, to thank you for your informative and well reasoned responses. I may not – in fact, probably won’t – agree with your conclusions in every instance, but I appreciate your civil approach to the discussion.
@AJ Hill:
I used to be, in my younger days, completely ambivalent about politics, mainly due to me not giving a damn one way or the other. And the reason I didn’t give a damn was due to my ignorance about politics and that I thought nothing either party did really affected me.
And then a funny thing happened. After going to college for a year and then not being able to continue, I joined the Navy. As part of my enlistment, I was required to offer this oath;
I had uttered an oath for something that I understood very little of. It was quite disconcerting, solely because I had just sworn to defend something I had little understanding, including giving my life for it if needed. I had a real choice to make at that point. One, I could ignore it and go on blissfully ignorant of the gravity that oath held me under, or, two, I could take the time and learn about what I had just sworn to support and defend.
So, I decided to spend the time necessary to learn about the Constitution. That led me to further material, including the Federalist Papers and Anti-Federalist Papers, which led to even further material, including Thomas Paine’s Common Sense, which, as I told you, included his Agrarian Justice bit. Partway through this the internet was born, which eventually spawned the ability to instantly receive info at your fingertips. Suffice it to say that I had, literally, all the information I’d ever want, available to me when I wanted it without having to peruse the stacks in libraries. I had always been an avid reader, but mostly of fiction and novels with smatterings of magazine tech articles. Now, however, I was also into reading political pieces, not only in magazines, but also essays and books from various sources, including Limbaugh’s The Way Things Ought To Be.
It was also during this time that I voted in my first Presidential election. As with the oath I took, I thought it prudent to find out more about these characters before I pulled the lever for any of them. It is a regret that I chose Perot, though, for even though I, at the time, agreed with much of his points, I was a part of a larger group that handed the Presidency to Clinton. And being still in the Navy at the time, let me tell you that the change was many times more pronounced than the civilian world, concerning how things were done. It seemed that the dirty side of politics was flooding into the military. Honor and commitment were pushed aside and the “blame first” and finger-pointing crowd were becoming prominent. And it came from the top on down through the ranks. In short, it was a very different atmosphere in the military under Clinton than it had been under Bush.
Anyway, I left the military in 1999 to pursue some career in the civilian world, and a large part of the reason was Clinton, and the idea that Gore was virtually a lock at that time to become the next President. I refused to serve under such people, as I personally came to despise them and what they stood for. During the early 2000’s I had become aware of a work of fiction by an author I hadn’t heard of before. Atlas Shrugged was, perhaps, the best book that I had ever read, and I’ve read literally thousands of them so far in my life, from classics like Dickens and Melville to the action-thriller pulp rags like The Destroyer series. But, back to the book. It wasn’t the story so much that caught me as it was the underlying ideas and principles of the main characters. I identified with them in a way I had never done in any previous story. Their principles were my principles.
Now, one can talk all they want of Rand herself, however, the principles she wrote into her characters happened to be the same principles I had read regarding many of the founders and other American icons, albeit, without the religious aspect.
I devour information, AJ. I read a lot. No, I don’t believe everything I read, just as I question everything on the TV news. I have a healthy amount of skepticism at what is presented, how it is presented, and why it is presented. I hold no illusions about those talking heads, whether I identify them with the “right” or the “left”, liberal or conservative, Republican or democrat. They are all there to push their points across, or to present the world in their view. It is simply that I do not identify with the principles of the liberal/progressive crowd, and, in fact, see their principles as in direct opposition to mine for the most part, that I avoid as much as possible listening to, watching, or reading, anything by them.
Now, why the “life story”? Because it is intended to display that I came to my views, not based on purely listening to, or reading, one side and becoming so ingrained in their way of thinking that I was, essentially, a mindless bot of theirs who simply parroted their “talking points”, but instead, chose my own path, based on my experiences, both growing up and living as an adult. I am, truly, an “independent”. Not from the typical view of that group, but from the standpoint that I do not follow any particular political party out of association. While I vote mostly Republican, and indeed, nearly completely now in the past decade, I have voted for both Democrats and third-party types. It is not political party which drives my votes, but with who I identify with concerning liberal/progressive, or conservative.
The liberal/progressives of today are not the classical liberals of the past, just as the conservatives today are not the conservatives of the past(and by past I’m speaking of the time of the founding of our country). Both have evolved over the two centuries, with the liberal/progressives becoming more like socialists, or, as Mark Levin puts it, Statists, and the conservatives being more like the classical liberals of our founding. You may disagree, but the facts speak for themselves. This is why I repeat the words, points and views of many of our founding fathers quite often on this site, and have based my arguments to actions by politicians mainly on the point of, “Does the Constitution allow them to do this?” That should be the first question asked about any legislation proposed to become law, or about any government edicts from the various dept’s and agencies. Does the Constitution allow them to do this? Without an answer in the positive to that question, all other arguments about such legislation or government edicts becomes a moot point.
So, and I would hope that you could see, that I am not some mindless robot of the “right”, or the Republican party. I do not parrot their talking points out of association, but rather, repeat them because I believe them to be correct. I am open to listening to anyone, or reading their comments, for the most part, but just because I don’t agree with them doesn’t mean that I’m “close minded”. Rather, I compare what they say or write to my experience, principles, and knowledge, and if they don’t coincide, then I reject them. Now, does that sound like someone who is unreasonable? Or, who doesn’t think with reasoned analysis?
This is a long and lengthy post, and I apologize for the length, however, I felt it necessary in order for you to better understand what I am. And, for your information, I’ve found most of the posters and commenters here at FA to be like I am, even some of the self-defined liberals here like Larry W. We are independent thinkers and voters, regardless of our leanings toward one political party or the other.
@johngalt: “There are many reasons companies shipped, and continue to ship, jobs overseas, AJ, and chief amongst these is regulatory and taxation policies that inhibit growth, at the least, and profitability, at the worst.”
There are indeed many reasons, including the regulatory and tax policies that you mention, and one that you omit.
(1) The regulatory “burden” of doing business is one of conservatives’ chief targets. Regulations increase the cost of doing business and are also antithetical to their laissez faire ideology. There’s no question that regulations increase costs, but are their benefits worth it? These judgments often reduce to personal opinion – for example, if your son (husband, boyfriend, …) worked in a specific industry, would you favor safety regulations that might save his life? Considered on a case by case basis, the public often favors regulation, even at the expense of higher prices.
(2) Conservatives claim that the U.S. has the highest corporate tax rate in the world. This is true, as long as one considers only nominal or statutory rates. In application, due to tax loopholes, tax refuges, rebates and other exceptions, the U.S. has one of the lowest corporate tax rate. Many giant firms (like Exxon Mobil, Boeing, Citigroup, and General Electric) make record profits, yet pay no U.S. federal income tax. Some even get rebates ($156 for Exxon Mobil). Smaller corporations often don’t make out as well as the large multinationals, but these are also less likely to move or capable of moving their operations overseas. As basic policy should we allow corporations to expatriate their operations in order to increase profit? I think not! Many economically successful countries use import tariffs to protect domestic industries and discourage job los, even though studies have shown that overall growth may suffer.
(3) In most businesses wages and benefits account for 50% to more than 75% of operational costs, far outweighing other factors. By moving overseas corporations can often tap a large nonunionized labor forcer willing to work for a small fraction of what American workers require, without benefits Businessmen are often reluctant to discuss this aspect of their decision to move offshore, although it’s often the deciding factor, because it’s unlikely to win public support! Profit may not be a bad thing, jg; but, when it’s a direct result of firing Americans and hiring third world peons in their places, it doesn’t look good! Another reason for downplaying this motive is the implied threat that the only way to get those lost jobs back is to requireAmerican workers to accept third world wages and working conditions: just another part of the ongoing war on the middle class.
Your long, detailed elaboration of what I assume are CBO projections was impressive, but somewhat unconvincing. As you noted, many of the numbers are based on CBO projections of GDP growth rates, costs, and other factors. Even if I had access to the details of the CBO’s calculations, I’m not sure I could follow them. I was struck, however, by one thing. After noting that new spending may amount to as much as $7 trillion, you remark that “even a FULL return to the Clinton-era tax rates would only net $3.4 trillion in additional revenues” over ten years. Since when is cutting the deficit in half inconsequential?
In assessing the Republican claim about spending vs. revenue, I prefer another argument. It has the advantage of expressing spending and revenue in terms of GDP rather than specific (therefore changeable) dollar amounts. It goes like this: In 2001, at the end of the Clinton administration, federal revenue was about 19.5% of GDP, while spending was 18.6%. The difference represents the Clinton budget surplus. Spending had evidently not begun to increase, since it had remained around 18% of GDP for nearly four decades. By 2010 spending had increased to 23.9% of GDP, while revenue had fallen by a nearly equal amount to 14.9%, the lowest value in nearly half a century. There’s no denying the existence of a significant deficit between the two; but what justification is there to claim that the rise in spending is more important than the comparable decrease in revenue or more deserving of being corrected. In addition the drastic reductions needed to match spending with the (abnormally) low revenue would almost certainly entail cuts to vital (and popular) programs like Social Security, Medicare, Pell Grants, and so forth. In fact, proposals like the Ryan budget, with its drastic cuts to these very programs, make it impossible not to suspect that this was the Republicans’ aim all along. When they first began chanting “We have a spending problem, etc.” nearly a year ago, that was the first thing that occurred to me. The Democrats, as usual, seemed oblivious.
@johngalt: @johngalt: I somehow skipped over this post before reading your long self-revelatory essay, which is probably just as well. I liked the latter, but this one is sadly disappointing. Maybe it’s just that you’re young and haven’t developed a very even handed way of looking at the world. Instead you’ve absorbed the tendency, more pronounced among conservatives than liberals, I’m afraid, of inventing straw dogs to belabor rather than debating things on their merits.
In fact, I use the term “talking point” exclusively in the third sense that you cite, nor do I believe that Republicans are the sole ones to use talking points. They’re a common, often useful device in political movements. You may “believe” that I intended the phrase in a perjorative sense, but you’d be wrong. You may also think that calling these memes “catchphrases” creates a useful distinction. It does not. The right has plenty of glaring vulnerabilities, as does the left; and your attempt to make something out of this triviality is simply foolish. I expect better of you.
From trivial and foolish you descend to what can only be described as blind ignorance fueled by partisanship and for this you should really be ashamed, for it puts you in the intellectual camp of the others who post here. It’s hard to believe that anyone of even average intelligence could believe that liberals (apparently alone) have instigated every form of social conflict known to man, but that’s what you seem to say.
To take just one example, you are aware, I assume, of the Republicans’ notorious “Southern Strategy” that was devised and employed to gain political advantage by inflaming racial prejudice and tension in the South. What precisely did Liberals have to do with this ignoble campaign? How does this support your accusation?
As to the rest, there’s a crucial difference between taking up the cause of an oppressed minority (women, African Americans, gays) and “instigating” conflict. The conflict in each of these cases was already there, often on a very unequal basis, and liberals simply chose sides. The fact that Republicans had reliably chosen the side of the oppressors in these cases hardly speaks in their favor.
It’s good of you to lecture me on the details of income redistribution, but unnecessary. I’m well aware of what’s involved and moreso than you, since I manage to see both sides of the issue. I have no illusions about the purpose of many liberal policies. The reason that income redistribution from rich to poor is a desirable goal is the extraordinary degree to which it has occurred (and is still occurring) in the other direction. Your unwillingness to acknowledge this (or even to see it) was reflected in your rejection of the data contained in Dr. Domhoff’s paper. As I pointed out at the time, you didn’t criticize his paper or his analysis based on their own merits. You rejected it out of hand, purely on ideological grounds. What gave the episode an element of farce was your belief that the data would somehow magically change into something acceptable to you, merely because of the way it was displayed on a graph. Comical and shameful at the same time.
Next topic is your supremely ignorant attempt to blame lower income people for their relative misfortune. Do you seriously contend that Mitt Romney or Donald Trump, to name just two, owe their wealth to their innate abilities or that they in any sense started life on the same footing as, say, a center city teenager from a broken family? When Romney was stripping the companies he’d bought with leveraged capital, misappropriating their pension funds, and turning the workers out on the street, was he not conducting class warfare of the most viscious and contemptible sort, using his inherited wealth and the privileged position that his father bequeathed to him ? Please explain, if you can, how the average inner city black, hispanic, or even impoverished, single parent white youth is neglecting his “opportunities” compared to Mitt. I’ll be very interested to hear your theory.
Lastly I shouldn’t have to remind you that I’m no Marxist, nor even a socialist. If you don’t know the different characteristics of these economic theories, you can look them up. I support free enterprise, just not the rigid laissez faire variety that you espouse. And, of course, I didn’t claim that any of the Founders were Marxists or anything like it. They did distrust extremes of wealth accumulation and contemplated ways of preventing or reversing these. The fact that their political and economic horizons included only inheritance taxes is merely a product of their times, another reason why a slavish reliance on their worldview is foolhardy two centuries later.
It seems that every time I get my hopes up for you, jg, you shatter them with a litany of thoughtless ideology and the kind of psychological displacement reaction that seems to be endemic around here. You also seem to share the conviction of MattersHardly and others that you can insult me or anger me by calling me a Marxist or some other stupid epithet. You merely demostrate you ignorance or perhaps your desperation. In most instances this is funny (as in clownish). In your case it’s just sad. As I said, I had hoped for better from you.
AJ, here is fair, probably a little too simple, but there goes, you don’t ask 1/3 of the nation to do something you are not asking of the other 2/3s. You don’t ask me to pay more taxes without asking those receiving those taxes to do with less. I will give you another hint, taking 50% of anything anyone earns is not fair! Taxing someone again when they die on money that has already been taxed is not fair. See, “fair” doesn’t have to be complicated…just some people want to do so, for their own gains.
@Rob in Katy:
Aj is a statist. He doesn’t care about fair, just puffing up his ego/feeding his narcissism.
@AJ Hill:
In response to your #17;
-One, considering regulations, I take it that you don’t work in an industrialized setting. I do. And it isn’t the “safety” regulations that I am talking about, even though some of them are completely useless. No, I am talking about environmental regulations that increase the cost of doing business, that have no benefit to anyone.
-Two, concerning corporate tax rates, the US has the 6th highest effective corporate tax rate of any industrialized nation. Now, while you list some examples of companies that pay very little to no corporate taxes, the vast majority of companies in the US do pay, and pay high amounts. What you list is companies that get special tax breaks or incentives, and use them to suggest that US corporations overall pay very little. Very misleading. And something I don’t agree with, particularly as those companies enjoy those special tax breaks at the expense of other companies. In a phrase, the government, by legislation, is picking and choosing the winners and losers. Not something that I agree with, but it is something that happens as governments, federal, state and local, do for companies to entice them to stay here in the US, or in a particular state, or locale. I’d much rather see a complete abolishment of tax breaks and incentives for companies while at the same time lowering the statuatory tax rates for corporations, putting each company within an industry on equal footing and letting the market place choose the winners. This would have the added bonus of lowering the corporate tax rates in the US, as compared to other countries, allowing our corporations to better compete globally and the US.
-Three, it depends on the particular job as to where the percent of total cost of doing business that wages and benefits fall within. In the industry I am part of, for example, wages and benefits account for as little as 10-15%, depending on the particular year. I do understand that other industry and professions have higher, and sometimes, much, much higher portions of their total cost as wages and benefits. This, however, is as influencing a factor as you make it seem. Other factors, combined with wages/benefits, will lead to forcing companies to locate jobs overseas. You can talk about wages/benefits being a main factor in shipping jobs overseas, but you are mistaken.
Do you not comprehend what I was saying? Do you know anything at all of “baseline budgeting”? I can admit to number crunching being somewhat boring for most people. They are so for me as well. However, to understand fully the impact of the excessive spending of the government, one has to understand the numbers involved, which, from these sentences of yours, you do not;
The thing is, it’s not cutting the deficits in half, AJ. It is only cutting the amount of new spending in half. Remember, the starting point was deficits of $1.5 Trillion. So, in effect, the only thing that the $3.4 Trillion in tax hike number does is reduce the percentage of growth needed to simply maintain deficits of $1.5 Trillion per year. Is that sustainable? No, as Greece, Italy, and Ireland are finding out with their debt/GDP ratios exceeding well above 100%. And that is where we in the US are heading to.
The whole point of that numbers crunching exercise, AJ, if you had been able to follow it and comprehend it, is that it IS SPENDING that is the problem. It always has been. For a contrast, AJ, the amount of tax increases that Obama is talking about, on those making greater than $200k/250k, would only net around $70 Billion a year extra in revenue. Think about that. $70 Billion more when the deficits are well over $1 Trillion. Can you see why we call this “class warfare” instead of what the liberal/progressives describe it as, which is tax increases to cover the cost of spending.
Because spending is something that congress has direct control over, along with the President, AJ. Revenues are dependent upon the economy, and GDP growth, along with a host of other factors that change depending on how, exactly, the full GDP is made up.
You talk about spending and revenue as a percent of GDP. Fine. But you submit numbers that are misleading, AJ. For example, that 14.9% revenue number you use happened due to the economic crash of 2008, and not due to any particular tax policy. Following the Bush tax cuts of 2003, for example, federal revenues climbed again up to 18.5%, and likely would have continued to climb were it not for the housing bubble bursting like it did.
A false statement, AJ. Spending averaged above 20% for the decades of the 70’s, 80’s, and 90’s(even with the reduction during Clinton’s years). The only decade of the past four that it average around 18% was the 60’s, but even then it had climbed to around 20% by the end of that decade. And as for it lowering during Clinton’s terms, I can tell you from personal experience why that was. He seriously cut the military. The effects were felt by all branches of the military, AJ. And, on top of that, we in the military were asked to do the same job with half of the support. It was an impossibility. That is the biggest reason why spending increased under Bush, AJ. Bush’s intention was to build the military back up to the effectiveness of his father’s, and Reagan’s times. Now, don’t misunderstand me. I’m not saying that I believe we needed a military that large. It comes down to what the military is tasked with, and then providing them the necessary support to be an effective force. That is something that degraded under Clinton, while he tasked the military with having a wide footprint on the world. It does not, and cannot, work that way. Reduce the military footprint, and a reduction in the military itself can be made, while keeping the military as effective as it should be. There is no alternative.
But, back to your numbers. Revenues, as a percent of GDP, had dropped from their high of 20.6% under Clinton, to 16.2% by the end of 2003, with most of that drop coming prior to the tax cuts of 2003. If you remember, there were two big things that happened during that time. The dotcom bust and 9/11, both affecting the economy and causing people to pull back on personal spending and companies to pull back on spending capital. The Bush tax cuts did exactly as promised, AJ. They freed up money to be spent that got the economy moving again, and in the process, started growing revenues again.
The spending percent of GDP grew, yes, but only to around 20% or so. Your 23.9% number is actually a decrease from the previous year in which it was 25%, but those numbers are due to TARP and the Obama Stimulus(a large part of which was shifted to mandatory spending and subject to ‘baseline budgeting’).
So, I will still call it a spending problem, and not a problem of revenue.
@AJ Hill:
This;
And this;
Going back to using condescending comments I see. We should get one thing straight, here and now. I don’t take kindly to being talked down to by someone like you who assumes an air of superiority over others, lords it over them, while being ignorant of a great many things. Your comments show a great tendency to look at issues from a liberal/progressive point of view. Which is fine, as I certainly won’t tell you HOW to think. I will present the case, as I see it, in contrast and opposition to your views. I do that with other liberal/progressives here, and they do the same with me and the other conservatives. And none of the condescending, insulting language is inserted in our discussions. If that’s what your about, then you and I have nothing more to discuss. If that isn’t your goal, then read on, if you desire.
I never called you a ‘Marxist’, AJ. I never called you anything other than ignorant.
Condescending, and wrong. Reasoned, intelligent thinkers can be principled, AJ, and simply holding a different worldview than someone else does not make them ‘close minded’, as you suggest from that above.
You talk about “class warfare” and assume that I discount anything the Republican party has done, ever, regarding that. You could not be more wrong about that. While I did mention the liberal/progressives in particular, I have no misconceptions about any politician, or political party, pandering to certain groups, demonizing others, in order to gain votes. I stated that liberal/progressives are involved in that now, just as they are in other forms of social conflict, and all in an effort to pander amongst people for votes. The thing is, you claim to know all about this, from all political stripes, yet you continue to repeat the phrases and rhetoric from the liberal/progressives in your comments. And here;
Your comments there suggest that you are doing the same thing you accuse me of doing. Republicans reliably choosing the side of the oppressor? Really?!
It wasn’t a “lecture” in the negative sense, AJ, unlike your condescending tone and insults thrown my way. The fact is that liberal/progressives love to bring this up constantly, and the effort belies their intent to “instigate” economic class warfare. But, the truth is that the top 1% has held, on average, a percent share of income in the low 30’s, on average, since the income tax was enacted, varying from a high of 44% to a low of 19.5%. And this share varies, and even increases, independent of the actual tax rates. The real shift in income has been from the poor to the middle-class, and that middle-class has been the target, whether intentionally or not, of both parties in their class warfare policies.
It is funny, though, that you presume to lecture myself, and others here, on using ” a litany of thoughtless ideology” , while you, yourself, do the same, just from the opposite view. The difference being, of course, that we present many facts, figures, and examples to support our view while you continue to pour forth just more of the same rhetoric. This is, of course, a favorite tactic of the left now. That is, accusing the opposition of doing the very thing that they, themselves, are doing, and assuming, like you have here, an air of superiority over everyone as if you have a sole lock on reasonable debate. And all while your “reasonable debate” boils down simply to who can insult who the worst, or talk the loudest, or most often.
My previous post, in #16, was meant to give you an idea of why I have come to the view that I have. You, however, have assumed that I am, somehow, a mindless robot of the “right”, expressing thoughtless ideology that I do not understand. Personally, I don’t give a damn what you think of me. I will, however, defend myself against your insults and condescending comments. Especially as you throw them around while repeating your liberal/progressive ideology, and while not understanding, as you showed in your post #17, the facts of the issues.
This is you in post #12:
… and
This is from my post #15:
You may contend that I’ve been the one to introduce personal disparagement and antagonism into discussions or to use “condescending, insulting language”, but the record proves otherwise. I’ve lost count of the number of times that you’ve accused me of being “ignorant”. You can also maintain that you didn’t call me a Marxist. So, what’s your distinction, that I aspire to Marxist goals, but am no Marxist? Fascinating.
I’d also like to point out your habit of taking personally my criticisms of conservatives and conservative ideology, as though I had attacked you individually. Meanwhile you miss few opportunities to disparage liberals and ascribe the basest motives to them. If you’re really the kind of independent thinker that you describe yourself to be, then you ought to identify less emotionally with a particular ideology.
As long as we’re having this out, I might as well mention your lamentable tendency to act as though you know my innermost thoughts, even though I haven’t expressed the opinions you ascribe to me. For instance:
You “believe” ? On what basis? And where did I contend that Democrats don’t use talking points?
Hero worship? Because I agree with his comment about class warfare? Your other evidence for my “hero worship” is exactly what? Do you assert that you didn’t intend this remark as an insult, pure and simple?
I assume? How do you know that? Where have I said it? It is interesting that you continue to demonize liberals exclusively in this paragraph, which doesn’t do much to support your claim to broad mindedness.
I’m not going to use the word “hypocrit”, which gets thrown around too much on this site. However, I will say that you seem to expect a degree of restraint and decorum from me that you don’t ask of yourself. I’d also challenge you to cite any instance in which you’ve made the same kind of conciliatory gesture that I did in post #15. You could have reached out in response and furthered a spirit of comity. Instead you continued in the same hectoring tone you’ve developed throughout our exchanges. I’m happy to continue this discussion on a polite basis; but, if you think that repeatedly calling someone “ignorant” is polite, it’s unlikely I’ll succeed.
Why johngalt, I do believe that the run off at the cyber mouth, Hill’o’beans, has condescendingly called you a young, stupid whippersnapper in his comment above.. Really made me grin….
But of course, Mr. Hill’o’beans is above reproach, and the model of social civility… if not a bit boring in prose. (yes… that was sarcasm) Efficiency in the use of language for pertinent debate and communication is apparently not Mr. Hill’s forte. But that’s what happens when you spend more than your usual formidable years in campus life, and acquiring sheepskins, in order to find someone that will be impressed. Me? I’m more impressed with the those educated in real life… an experience that most career intelligentsia lack, came to late, or are unable to appreciate to it’s fullest bloom.
I believe “a rose by any other name” is appropriate. For example, Hill’o’beans says:
Did it ever once occur to this newbie that his tone is being matched, in kind, at every avenue? But of course not….
Glossing over a negative message with flowerly words is only effective on two types of people: those who either don’t comprehend the masked and demeaning message, or those who simply get bored reading them…. thereby passing the entire point by. The rest of us? That thorn on the rose is overt… no matter how valiant the attempt at pretty words. And oh, BTW… no Saul Bellows or Hemingway, Mr. Hill is. Tho I suspect he puts himself in the top tier of writers. So I hold a dual category… those that are not fooled by the attempt at disguised, seemingly “polite” rhetoric, plus bored to tears at the verbosity.
But what I really want to address is this particular comment… which is a common argument for those who simply don’t delve into the fiscal realities of those ugly “big oil” American companies. This is either because they are lazy or uninterested, or that they actually know this and it becomes an “inconvenient truth” for their personal political beliefs.
That’s an interesting observation, and perhaps made by some of the most naive. But to buy that theory, one has to assume that American oil companies greatest profits are refining oil for fuel at the pump. However, an oil company’s greatest profit lies in E&P. And, using Exxon as an example, those like Hill’o’beans are railing about a two cent profit on a refined gallon of gasolene – their primary US operation – sold in the US. This is less than 3 percent of their total company profits for an international enterprise that has various operations/divisions in over 100 companies.
Therefore the question that should be asked of those that think like Mr. Hill’o’beans is… should an international operation be taxed in the US for profits they earn outside of the US? I don’t have a problem answering this… absolutely not.
Since E&P brings speculative reserves to realistic production profit, and since the feds collected at least $9.4 billion in royalties from offshore alone of mostly unused/unproductive leases in 2007, if you’re planning on socking it to the oil industry, wouldn’t it be more prudent to allow them to develop product on US soil, and collect taxes? Not to mention that those evil “corporations”, that are comprised of shareholders that include common investors… including pensioners and 401K type employees… would also benefit with taxable capital gains revenue for the increased earnings.
BTW, over half of that revenue on leases goes straight to the US Treasury. The rest gets distributed between the Land and Conservation Trust Fund, and what’s left over is a nominal amount that is split with the states where the leased land is held. No brainer cash just because of ownership, and poor decision to thwart production or increase the amount of taxable profit… thereby US generated revenue for taxes… all of which could be revenue gained if the MMS, Dept of Interior, EPA, WH and liberal Congress didn’t have a green stick up their posterior about being self sufficient for oil and gas production in the US.
Yes… an inconvenient truth.
The rest? The usual… “mom! he insulted me when I was sooooo nice” crap. Get a grip, AJ Hill. You fool few, if no one, here.
@johngalt: Okay. As Bill Gates used to say (and perhaps still does) let’s “drill down” on a couple of these topics and see if we can reach some kind of concensus. I’ll take them in order per your post #21.
(1) Regulating corporations – No, I haven’t worked in an industrial setting, except for occasional summer jobs; I’ve worked professionally in healthcare, one of the largest and most heavily regulated sections of the U.S. economy. Did I find the regulations there onerous? Occasionally. Did I think they were “useless”? Seldom, if ever. Safety regulations in the healthcare industry protect patients and sometimes the healthcare workers themselves. Things may have been different in your industry. You say unequivocally that “some of [these regulations] are completely useless.” Perhaps you can enlighten me with some examples. What safety regulation would you forego, if you or better still your brother, son, wife, … were at risk? What sorts of injury, what types of fatality would you willlingly invite by eliminating the regulations intended to prevent them?
The same goes for environmental regulations that you say “have no benefit for anyone.” That’s a big category. So specifically what environmental regulations do you characterize as benefiting noone, and why?
(2) Corporate taxes – The report that the U.S. has the 6th highest effective corporate tax rate among industrialized nations comes from a PricewaterhouseCoopers study; but other reports don’t necessarily agree. In a comparison of tax rates for G8 and BRIC countries, the U.S. comes in 8th and among more than 30 OECD countries, the U.S. effective tax rate is well below the average. Taken together these figures hardly provide conclusive evidence that U.S. corporations are forced to move offshore by high tax rates, either nominal or effective.
(3) Wages – In a study of median salaries as a percentage of operating expenses, U.S. industries break down as follows:
Highest categories: Healthcare – 52%
For profit services – 50%
Education – 50%
Lowest categories: Durable goods manufacturing – 22%
Mining & energy production – 22%
Retail/ wholesale – 18%
It appears I overshot the mark in my previous post. Nevertheless, these are far from negligible costs. Even in the lowest category median salaries contribute nearly one fourth of total operating expenses and half in the highest category. Since wages in poorer countries can be several times lower than in the United States, it’s clear that wage reductions offer the greatest potential savings for companies that export job, far greater than any potential sparing due to lower tax rates or the absence of regulations. So I wonder again, why are they so conspicuously absent, when conservatives list the reasons companies are “forced” to move their operations?
I still find it hard to believe that Ross Perot’s warnings on this point have been so thoroughly forgotten. You say you voted for him. I wish I had! That “giant sucking sound” he described has been echoing across our borders ever since.
Actually, I’d never heard of baseline budgeting, but a quick Google search remedied that. It’s not rocket science: budget projections based on current expenditures with adjustments to future values according to whatever assumptions one wants to make about the economy and program changes. Your arithmetic was straightforward, but all you demonstrated was that revenues are unlikely to match future expenditures, if these are extended unchanged over ten years. Who doesn’t know this? You still didn’t prove that spending is the “only” problem. For instance, you corrected me on one point:
Okay. Point well taken. Let’s add the $1.5 trillion baseline to the $7 trillion in new spending. That gives $8.5 trillion. Subtract the $3.4 trillion in tax hike revenue and one has $5.1 trillion, or a 60% reduction in spending that would be necessary. So I’ll rephrase my question: Since when is cutting the deficit by 40% inconsequential?” Basically the only thing your calculations show is that we have solely a spending problem only for those who are dead set against taxes and who want to cut as much as possible from the budget. But we already knew that about conservatives. Calculations weren’t necessary.
Let’s return to the analysis that I liked better (because it demonstrates the same things more clearly). You quibbled with my remark about spending staying around 18% for four decades. Very well. I’ll stand corrected on that, because it doesn’t affect the ultimate conclusion. Here’s a tabulation of federal revenue as a percentage of GDP for the past decade (from a study by the Tax Policy Center of the Urban Institute and Brookings Institute).
Year Revenue
2000 20.6%
2001 19.5
2002 17.6
2003 16.2
2004 16.1
2005 17.3
2006 18.2
2007 18.5
2008 17.5
2009 14.9
2010 14.9 (Note: these are the lowest levels since 1950, when revenues fell to 14.1% of GDP)
These figures agree with the ones that you cited, although you left out the most current years (how come?) We see that federal revenues have been abnormally low for the past couple of years. This would indicate to me that a sensible approach to the deficit problem would be to reduce spending from its unusually high level and to increase revenue from its unusually low value too. It’s the same inference that can be drawn from your more convoluted approach, but that’s okay. It’s a good confirmation, when different methods converge on the same conclusion.
An elegant and detailed treatment of the subject appears in “NO SILVER BULLET: Paths for Reducing the National Debt“, published by the nonpartisan PEW Trusts. You won’t be surprised that it reaches the same conclusion I do, just more convincingly. I have to admire the mileager that Republicans have gotten out of this by saying in effect, “It’s so, because we say so!” but I’m not sold.
@AJ Hill:
Calling you ignorant is polite. You being condescending and insulting in your comments directed at me isn’t. But, as that has been the case in nearly all of your comments, directed both at me and other posters, it certainly doesn’t seem likely that you will change. So continue to spout off about your liberal ideology. Just don’t expect any niceties such as I extended in the other topic, if I even continue to give you the time of day.
@AJ Hill:
Again, you miss the mark, mathwise. Those $7 Trillion and $3.4 Trillion numbers are over TEN years. So, in order to calculate correctly, one must multiply that $1.5 Trillion deficit number over ten years as well. To sum, that gives us $22 Trillion in spending above and beyond the estimated revenue intake. And, subtracting that $3.4 Trillion in new taxes, or revenue, we are left with $18.6 Trillion in spending above and beyond the revenues taken in. Your reduction isn’t half. It isn’t 40%. It’s much closer to 15%, leaving 85%. Again, it’s the spending, not the revenues. And, of course, that $3.4 Trillion assumes no adverse effects to the economy itself, which would not only affect the new tax revenue estimates, but also the current tax estimates.
It wasn’t a “quibble”. It was simply looking at factual evidence and noting that not only were you not correct, the figure you gave wasn’t even close to the reality.
For obvious reasons. Mainly, that the economic downturn/recession/depression(whatever one wants to term it) was not in any way shaped by, or caused by, the Bush tax cuts.
Except, genius, that you happen to exclude the point, in 2007, where revenues had climbed to 18.5%, and were likely to climb higher still, if not for the housing bubble bursting like it did. It seems to me, and is likely obvious to others here as well, that you “cherry-pick” data that supports your assertions, and that you do not look at the whole picture.
And most people haven’t, which explains why most people didn’t have a clue that Congress and the WH were screwing the country over with their “deal”. I don’t blindly follow and bow down to the Republican party like you suggest that I do. If you’d been here during the debt ceiling debates and discussions you would have seen this. In fact, what you would have seen is my anger directed almost entirely in the direction of the GOP, as the actions and rhetoric of the Democratic party was expected. Of course, you didn’t know this, but you assume that I’m, somehow, a “shill” for the right wing, and most likely, why you feel it necessary to talk down to me as if I’m some naive, innocent 20-something year old who doesn’t know any better. Marxist? No, but you certainly are one of those “useful idiots” that Stalin laughed about. I could count the numerous examples of you trotting out the favored lines and ideas of the liberal/progressives, throughout your many posts here, but why bother? You’d likely come back with more snarkiness and condescending attitude, even while being proven mistaken or wrong about your latest attempts at “facts”. I’m done with you, as you don’t seem to get it about the discussions here, that we generally have reasoned debate and interactions between liberals and conservatives, and even, to some extent, like one another and respect one another. You haven’t shown any propensity in that regard from post number one, even as I extended a helpful suggestion to you. My mistake. That certainly won’t happen again. I likely won’t respond to any more of your inane babble about wealth redistribution and liberal ideology regarding exactly how liberals propose to run my life.
@MataHarley:
I’m likely done with AJ, Mata. The level of ignorance displayed by him/her/whatever on economics, the founders, government finances, etc., and the insistence on condescension and insulting language is not something I want to deal with. Larry W is not only more intelligent, but infinitely more respectful. And to a large extent, so are Greg and Rich. Besides, I like those guys, even if I do believe them to be wrong. This imbecile? Not so much.
From Net Right Daily via Tax Prof Blog:
h/t – Instapundit
Baseline budgeting may seem like esoteric theory to you, but it’s just simple arithmetic. You made a big deal of throwing out numbers in your rambling, disjointed presentation; but none of that made any difference. No matter what the numerical outcome, you’d have made the same arbitrary claim, that revenues don’t matter and spending does, another reflection of your slavish dedication to right wing orthodoxy.
Regarding the record of yearly revenues, the only figure that matters in judging next year’s budget is the abnormally low value for the current year, which indicates that revenues should be increased. You omitted mentioning the current value for revenue, I suspect, because you sensed it would undercut your conclusion (which it did!) The fact that it supposedly wasn’t caused by the Bush tax cuts means nothing at all. So what? How would that, even if true, affect the argument? Same goes for the isolated increase in 2007 that you brought up. What difference did it make? And if it made a difference, what about 2006? Or 2008? Why not include them? This is typical. You throw out irrelevant facts and then exult that they prove your point, when they do nothing of the kind. It’s absurd, but not as absurd as your “graph gaffes”. Selecting a single data point and comparing it to the overall average, as if that proved anything about the shape of the curve was just another priceless example of ignorance that you refuse to acknowledge. An honest person would have admitted that he didn’t have a clue and maybe even learned something. Not you. You’re like MattersHardly. In fact, you two make a great team. I’ll have to keep an eye out for your future mathematical exploits.
As for the tone of these posts, I made even more of an effort with you than I did with MattersHardly to be conciliatory and to refrain from impolitic remarks. What a waste of time that was. Your idea of courtesy (in others) is meek deference to your jingoism and rigid ideology. You say you dislike patronizing insults, but obviously feel no compunction about employing them yourself. This would be hard to tolerate, even if you had the intellectual chops you presume to, but you’re not even close. If you had to engage in honest debate, you wouldn’t have a chance. For one thing, you wouldn’t be able to duck questions and ignore losing arguments, as you routinely do here.
I’d hoped to find an articulate, open minded, even well informed correspondent with whom to debate issues and gave you every chance to prove yourself. You might have been a worthy opponent. Unfortunately your unwavering fealty to right wing dogma cripples whatever reasoning ability you might have. It’s hard to tell sometimes whether you’re basically stupid or just hobbled by ideology, but in practice the difference is usually moot.
As to your imagined threat not to respond to my posts, if you had anything to offer, if you had made any effort or displayed even a soupcon of intellectual honesty and humility, I might be disappointed; but now I just don’t care. I’ll comment on your posts, when it amuses me to do so. Read my critiques or not, respond or not, as you choose.
Ah yes… for those here reading, relatively new to this newbie commenter here, we may want to revisit his “efforts” to “be conciliatory” to me.
Let’s see… first he takes my comments, thinking I am Hard Right, and leads off with insults prior to addressing my counterpoints… calling them “a sampling of your variousmalaprops and falsifications”. Additionally, because I label the entitlement programs a ponzi scheme, he says I am “threatened” by facts and that I have resorted ” to perjoratives and ad hominems.” Then, of course, there’s a lesson in grammar.. which has little to do with anything, but certainly services his self-serving bit of pomposity.
Hey… a walking testament as to how to win hearts and minds, this one isn’t..
Four comments later, I tell him he’s barking up the wrong tree, and hasn’t a clue as to whom he’s addressing. I also correct his blanket assertion that FICA taxes have a cap… which is false and an ever morphing cap, placed only on the SS portion of FICA taxes.
Apparently, Hill’o’beans doesn’t like being corrected on political and legislative facts. So despite knowing that he was verbally assailing the wrong person, he first comes back with a one liner, blanket insult. That not being enough for Mr. Personality, he then comes back with yet another another personally insulting comment, attempting to justify his FICA statement and mischaracterize my correction of his facts.
The final straw was the “attempt”, if you can call it that, at an “apology”… And I assure you, one would have to be very loose in what one terms an “apology” to see it that way. It was 12 paragraphs of a lecture on grammar, followed by one paragraph of an “apology”, where he also states that “…To be honest, as I read over post #90, other than mistaking you for someone else, I can’t see where I attacked you personally.”
uh… guess he missed those other two comments inbetween, yes? Despite knowing he was addressing the wrong person.
That’s Hill’o’beans idea of being conciliatory. To say that he made more of an effort with johngalt is true. The fact that he made no genuine effort with me speaks volumes about his underlying sexist and calculating personality.
Free free to comment when you like, Hill’o’beans. But don’t attempt to present yourself as anything other than you are…. self-absorbed and pious in your personal retrospect. Whether we have any interest to read your long winded versions of familiar “wealth redistribution” lectures is another story. But you’re always good for a laugh here.