Analysts: Letting Bush tax cuts die would kill recovery...

[gbpfan1231]

Exactly right about the ability of charitable donations to target what you want to support and the inability of taxes to do the same. I don't get the "we are already taxed enough" thing though, since our overall tax burden is lower than most European countries. We manage to support via taxes a gigantic military far greater than that of all Euro countries put together too. The argument that we are already taxed enough doesn't hold water when comparisons are made with other advanced economies.

 

Why do you disagree with a surefire way to kickstart consumption when the money will wind up back where it started anyway?

How can you say the money will end up back where it started anyway? To give an example of what Apathy was saying...

 

I am a dude who starts his own business and it flourishes and I become one these rich people. I now have so much money that it really does not matter if the govt takes a big chunk because my business will thrive more as the less fortunate just keeping buying my product. Well my kid has become incredibly sick and the time I spent keeping my business going is better spent taking care of my child and because of this my business is hurting and now I am spending money on doctor bills and not making anywhere near the money I was making before but all is OK because the money that I did make went to some less fortunate people that did not have the guts or take the risks I did to make it rich (while it lasted).

 

Maybe an extreme example but why treat people different just because they are considered rich - there are a lot of rich people that are not rich anymore.

 

Again - if people are so worried about the less fortunate getting more breaks and it will kickstart the economy then throw some more of your own earned money into the pot.

[Jimmy Neutron]

Lowering my taxes will not necessarily make me expand my business, that is true. It is also true that higher taxes will definitely limit how much if any I can expand my business.

 

That's really the crux of the whole argument. It's not one side or the other of this argument, but elemental truths in both.

[gbpfan1231]

That's really the crux of the whole argument. It's not one side or the other of this argument, but elemental truths in both.

True. I see both sides but I guess I just have always thought that the harder I work the more I succeed and if I succeed I should be able to choose where my money goes.

 

When I was in college I would come home and my mom would offer my sister and I each half of whatever was in her change jar. I always declined and said - you worked for that money and I work for my own money and I don't need your help to make it in this world. Just the way it was with me.

 

Now my sister was happy as can be because she grabbed the whole jar!

[Perchoutofwater]

I've currently got two guys making over $100,000 a year sitting at home doing nothing. They have been doing nothing for two months now. By the end of September I'll have five more with similar salaries sitting at home. I will be able to pay them to sit at home, and be able to continue to pay for their health insurance and other benefits because I was able to put some money back. Right now I'm going to try to keep them on for another 8 months. If my taxes were increased that is that much sooner they would be hitting the unemployment line instead of my bottom line. Yes when times are good people like me make a lot of money, but when times are bad, we not only don't make money, we bleed money. I'm going to make money this year though not much. Next year I know I'm going to lose money, a lot of money. Do you think the government is going to give me any of those taxes I've paid in previous years back? How many of you that think I should be taxed at a higher percentage than you would like to get up and go to work every morning, knowing that you're not only going to not make any money, but you are going to get to pay for the privilege to work.

Edited July 31, 2010 by Perchoutofwater

[Perchoutofwater]

True. I see both sides but I guess I just have always thought that the harder I work the more I succeed and if I succeed I should be able to choose where my money goes.

 

When I was in college I would come home and my mom would offer my sister and I each half of whatever was in her change jar. I always declined and said - you worked for that money and I work for my own money and I don't need your help to make it in this world. Just the way it was with me.

 

Now my sister was happy as can be because she grabbed the whole jar!

 

Don't you realize that other people know better than you how to spend your money, even if they themselves have no idea how to make that kind of money?

[detlef]

Lowering my taxes will not necessarily make me expand my business, that is true. It is also true that higher taxes will definitely limit how much if any I can expand my business. Most construction projects require a contractor to bond a project. Both my bonding capacity and my bonding rate are affected by my net worth and particularly my liquidity. If the government is taking more of my money it is decreasing my net worth or reducing it's growth, thus limiting my bonding capacity and increasing my bonding rates. So yes, increases in taxes make it much harder for me to expand my business when there is demand, and decreasing taxes would make it much easier to expand my business. Now, due to the size of my business, I offer my employees more in the way of benefits than smaller companies, so while smaller companies may be able to come in and pick up the demand that I am no longer able to pick up thanks to the additional tax, the people employed will more than likely be making less and receiving fewer benefits.

 

Why not just have a flat tax, do away with all deductions with the exception of charitable donations, and make it to where nobody pays any taxes on the first $20,000 made. It would make things a whole lot better, you wouldn't have all this class warfare.

 

 

I would actually have little problem with that, provided capital gains were taxed at or near that same rate. Well, provided there weren't a litany of ways the absolute wealthiest couldn't shelter their money from taxation. I'm afraid that would not be the case.

 

I guess my issue is this. The Bush temporary tax cuts were sold to us as a way to prime the pump. Well, the pump didn't prime. We were promised jobs because rich dudes would have extra money to spend and make them. Well, they didn't. They were 6% in 2003 when the second batch kicked in and they were 5.8% 4 years later in 2007. Doesn't seem like much of a fix. So, when people say that allowing the cuts to expire will make us lose jobs, what jobs are they talking about? What jobs were created by hooking up the top with a nice break and assuming they'd just go out and make jobs?

Edited August 1, 2010 by detlef

[bpwallace49]

So only unnamed bloggers are objective?

 

WSJ Blogs

Real Time Economics

Economic insight and analysis from The Wall Street Journal.

.Bush On Jobs: The Worst Track Record On Record

 

You didnt read the whole article where it states the author . . did you? How embarrassing . . .

 

Sudeep Reddy

The Wall Street Journal

Sudeep Reddy is an economics reporter for the Wall Street Journal

.

 

Here is his resume . .

 

Sudeep Reddy is a staff reporter at The Wall Street Journal, where he covers the U.S. economy and the Federal Reserve.

 

He joined The Journal in spring 2007 after six years at The Dallas Morning News. At The News, he was a Washington correspondent covering the intersection of business and politics, the energy writer in Dallas and a reporter covering technology in Richardson, a suburb of Dallas. He also reported for the Democrat and Chronicle in Rochester, N.Y.

 

Sudeep received awards from the Associated Press Managing Editors for best business reporting and best deadline writing in Texas for stories related to Hurricane Katrina. He won the National Press Foundation's Thomas L. Stokes Award for Best Energy Writing for coverage of a kickback scandal inside Texas' electricity grid operator that led to indictments of several top officials. He also received the national print media award from the National Association of Consumer Advocates for stories about credit scoring.

 

Sudeep was born in Michigan and raised in the Dallas-Fort Worth area. He received a degree in biomedical ethics and history from Brown University, where he was an editor of The Brown Daily Herald. He is a member and past board secretary of the South Asian Journalists Association and a member of the Asian American Journalists Association.

 

But way to veer off course . . .

[bpwallace49]

I read the article Mucca linked and when I saw it was a WSJ blogger the first thing I thought was - Will bpwallace be stupid enough to do the whole who can trust an opinion piece from a blogger" - even though he posted one minutes before.

 

Wow - amazed by the intelligence.

 

You obviously dont know the difference between an opinion editorial and an fact-based article that has data measured over time.

[The Mucca]

You didnt read the whole article where it states the author . . did you? How embarrassing . . .

 

So blogger Sukeep should be trusted, but all other bloggers not

 

Way to side step your Dem quotes supporting Obamas farce,

 

"It's not only former Bush staffers such as Messrs. Fratto and Mankiw who have noted the political convenience here. During a March hearing of the Senate Finance Committee, Chairman Max Baucus challenged Treasury Secretary Timothy Geithner on the formula.

 

"You created a situation where you cannot be wrong," said the Montana Democrat. "If the economy loses two million jobs over the next few years, you can say yes, but it would've lost 5.5 million jobs. If we create a million jobs, you can say, well, it would have lost 2.5 million jobs. You've given yourself complete leverage where you cannot be wrong, because you can take any scenario and make yourself look correct."

 

Only sources from BP are valid, way to spin

[Ursa Majoris]

I am a dude who starts his own business and it flourishes and I become one these rich people. I now have so much money that it really does not matter if the govt takes a big chunk because my business will thrive more as the less fortunate just keeping buying my product. Well my kid has become incredibly sick and the time I spent keeping my business going is better spent taking care of my child and because of this my business is hurting and now I am spending money on doctor bills and not making anywhere near the money I was making before but all is OK because the money that I did make went to some less fortunate people that did not have the guts or take the risks I did to make it rich (while it lasted).

What difference is the top rate of tax going to make in this scenario?

[Ursa Majoris]

Do you think the government is going to give me any of those taxes I've paid in previous years back?

No, but it IS going to let you write off losses so you pay a lot less for the year you make less money. It's also going to let you do funky things like depreciate new equipment.

 

And those taxes you paid in previous years? You get them back all the time, we all do.

[Ursa Majoris]

allowing the cuts to expire

This is the piece that irritates the crap out of me. The last ten years were a temporary reduction in the normal tax rates. Now the ten year reduction is up, it's time to go back to where they were as planned. Yet there is wailing and gnashing and screaming.

 

Bah. These people are no different to the welfare leeches they excoriate - give them something temporary and they think it's an entitlement.

[bpwallace49]

You didnt read the whole article where it states the author . . did you? How embarrassing . . .

 

So blogger Sukeep should be trusted, but all other bloggers not

 

Way to side step your Dem quotes supporting Obamas farce,

 

"It's not only former Bush staffers such as Messrs. Fratto and Mankiw who have noted the political convenience here. During a March hearing of the Senate Finance Committee, Chairman Max Baucus challenged Treasury Secretary Timothy Geithner on the formula.

 

"You created a situation where you cannot be wrong," said the Montana Democrat. "If the economy loses two million jobs over the next few years, you can say yes, but it would've lost 5.5 million jobs. If we create a million jobs, you can say, well, it would have lost 2.5 million jobs. You've given yourself complete leverage where you cannot be wrong, because you can take any scenario and make yourself look correct."

 

Only sources from BP are valid, way to spin

 

What on earth are you babbling about? Your panties were in a bind about a economic chart, that you said was "unnamed" even though he was clearly cited. Do you have some obsession with blogs in general? Or you cant distinguish from the tab at the top of the WSJ webpage that says OPINION and the ones that do not?

 

And if you DIDNt have reading comprehension issues, you would look back and realize that I agree with you on the topic of saved jobs and stated as such.

[bpwallace49]

This is the piece that irritates the crap out of me. The last ten years were a temporary reduction in the normal tax rates. Now the ten year reduction is up, it's time to go back to where they were as planned. Yet there is wailing and gnashing and screaming.

 

Bah. These people are no different to the welfare leeches they excoriate - give them something temporary and they think it's an entitlement.

 

Exactly. The only way that the Bush tax cuts could have been passed (and by reconciliation no less . . . ) was to put the sunset provision after ten years in. It was ALWAYS meant to be temporary . .

[Perchoutofwater]

This is the piece that irritates the crap out of me. The last ten years were a temporary reduction in the normal tax rates. Now the ten year reduction is up, it's time to go back to where they were as planned. Yet there is wailing and gnashing and screaming.

 

Bah. These people are no different to the welfare leeches they excoriate - give them something temporary and they think it's an entitlement.

 

What are normal tax rates? Since the inception of The Republic, what is the average highest bracket?

[bpwallace49]

What are normal tax rates?

 

Perch you know this was in reference to what the tax rate was under Reagan/Clinton . . .

[detlef]

What are normal tax rates? Since the inception of The Republic, what is the average highest bracket?

This is the first site I found that showed old data

 

As recently as 1980, it was 70% on $200K or more. Regan got pretty crazy when he lowered it to 50% a few years later. Then his boy Bush Sr. gutted it and made it less than 30% with the top bracket barely over 30K. That worked out really well, didn't it.

[Perchoutofwater]

This is the first site I found that showed old data

 

As recently as 1980, it was 70% on $200K or more. Regan got pretty crazy when he lowered it to 50% a few years later. Then his boy Bush Sr. gutted it and made it less than 30% with the top bracket barely over 30K. That worked out really well, didn't it.

 

Prior to Reagan there were a ton of deductions that were done away with to simplify the code, when he and congress lowered the rate. Still, what is a normal rate? What was it in 1910 or 1810. What is normal?

[Ursa Majoris]

Prior to Reagan there were a ton of deductions that were done away with to simplify the code, when he and congress lowered the rate. Still, what is a normal rate? What was it in 1910 or 1810. What is normal?

1910 is irrelevant, 1810 more so. Why not ask about 1950? 1975? The point is that the tax reductions were set to expire in 10 years because they would be unsustainable beyond that. It's time to execute the plan.

Edited August 1, 2010 by Ursa Majoris

[Deathpig]

I found a couple of articles from the Cato Institute (reference clearly named so the source can be easily attacked)-- yes, it is a group with a heavy bias to Jeffersonian market-liberal policies:

 

One illustrating tax cuts stimulating economy and increasing tax revenue in the 1920s:

http://www.cato.org/pubs/tbb/tbb-0302-13.pdf

 

And another showing similar analysis of the Bush tax cuts in 2007:

http://www.american.com/archive/2007/novem...-pays-the-taxes

 

 

Figured there wasn't enough factual, data-driven, analytic, well-sourced research available on this side of the argument for people to throw grenades at.

 

Have fun!

[The Mucca]

I found a couple of articles from the Cato Institute (reference clearly named so the source can be easily attacked)-- yes, it is a group with a heavy bias to Jeffersonian market-liberal policies:

 

One illustrating tax cuts stimulating economy and increasing tax revenue in the 1920s:

http://www.cato.org/pubs/tbb/tbb-0302-13.pdf

 

And another showing similar analysis of the Bush tax cuts in 2007:

http://www.american.com/archive/2007/novem...-pays-the-taxes

 

 

Figured there wasn't enough factual, data-driven, analytic, well-sourced research available on this side of the argument for people to throw grenades at.

 

Have fun!

 

Who would of thought?

 

 

I see grenades, and denials, flying already.

[WaterMan]

1910 is irrelevant, 1810 more so. Why not ask about 1950? 1975? The point is that the tax reductions were set to expire in 10 years because they would be unsustainable beyond that. It's time to execute the plan.

 

The tax cuts and two wars have done wonders for the economy.

 

Deathpig's author wrote this in 2001 before the tax cuts were put in place:

others worry that the plan -- scheduled to take place over ten years -- will cause an 80s style deficit.

 

 

I wish someone who didn't have a Liberal bias could provide some facts. Oh wait, Stephen Moore worked for the The Heritage Foundation so that's good to see some numbers skewed the other way in favor of his ex boss the late and great Ronald Reagan.

Edited August 1, 2010 by WaterMan

[gbpfan1231]

1910 is irrelevant, 1810 more so. Why not ask about 1950? 1975? The point is that the tax reductions were set to expire in 10 years because they would be unsustainable beyond that. It's time to execute the plan.

I actually agree that tax breaks that help the rich should be expired - the breaks that help everyone maybe not.

 

Just becuase they were set to expire does not always mean that it should happen.

 

Did they not just extend the unemployment checks? Were they not supposed to expire???

 

But wait I forgot what the beautiful mind of Pelosi says about unemployement - unemployment is a job creator - gotta love that stupid biatch.

[Sox]

Bah. These people are no different to the welfare leeches they excoriate - give them something temporary and they think it's an entitlement.

 

 

There is one very real difference.

 

They work.

[WaterMan]

There is one very real difference.

 

They work.

 

Kinda like this guy?

 

http://bernard-madoff-scam.blogspot.com/