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I haven't made a political post in a long, long time.

I'd make one now, except just thinking about it depresses me. I was not happy about the results of the midterm, needless to say... and I am even less happy, if possible, about this "compromise" that Obama has made with the GOP on taxes. From where I sit, it smells more like capitulation than compromise. Give a lot, get almost nothing.

Obama is the most intelligent president we've had since Jimmy Carter... and, sad to say, he is looking more and more like Jimmy every day. A good man, but not a good leader. At least not so far. He doesn't seem to have the stomach for a fight. We need another FDR, another JFK, another LBJ. NOT Jimmy II. (And, yes, I know, Obama has accomplished some important stuff. But so did Jimmy. Camp David accords, remember?)

Yeats was writing about his own time in "The Second Coming," I know, but sometimes I think he was prescient:

Turning and turning in the widening gyre
The falcon cannot hear the falconer;
Things fall apart; the centre cannot hold;
Mere anarchy is loosed upon the world,
The blood-dimmed tide is loosed, and everywhere
The ceremony of innocence is drowned;
The best lack all conviction, while the worst
Are full of passionate intensity.

And could that rough beast whose hour has come round at least be... Sarah Palin?

No, please. Tell me that's just a bad dream. Somebody wake me up.



Dec. 16th, 2010 12:28 am (UTC)
Re: Actually
"Furthermore, when these tax cuts were first enacted the federal government actually had an INCREASE in tax receipts, they made more money, despite lower rates, because the lower tax rates spurred economic growth."

In what bizarre reality are you living? The cuts may have spurred a small amount of growth, but they were still a massive net negative on the budget--they're the main reason the Clinton-era surplus turned into the huge deficits of the Bush years, even before the economy imploded.
Dec. 16th, 2010 01:40 am (UTC)
Re: Actually
I live in reality.

Clinton surpluses (and really? Why are they called "Clinton" surpluses? Why not "Secular Growth in Computers and Technology Driven Production surpluses") turned into deficits because of:

A. Dotcom recession (yes, Bush took over with a recession too)

B. 9/11 recession (not anyone's fault, unless you are a truther)

C. Bush spending on Medicare Part D and 2 Wars.

If you don't believe me, ask the government.

2003, the year in which the tax cuts were created, had federal revenues of 1.782 trillion. 2004 had revenues of 1.880 trillion, and they kept going up.

Surely if you're right and I'm wrong the government would have made LESS money after cutting taxes?

Let us also not forget that we were in a recession at the time, and the cuts spurred us out of it.

Even Obama admits that this is good for economic growth.
Dec. 16th, 2010 10:06 am (UTC)
Re: Actually
So, everything good is due to the tax cuts and everything bad is due to (something else), huh? Funny how that works.

I agree that the state of the economy has a big effect on government tax revenue. But you can't have it both ways. If the tax cuts were the only important factor, then the drop in revenue from 2001 to 2002 (look at your own data) shows that they cost more money than they generated via stimulus. On the other hand, if you admit that other factors than just the tax cuts have an impact on the state of the economy and the revenue picture, then you can't claim to know everything just by looking at the revenue chart.

Research done by the Congressional Budget Office makes it quite clear that the Bush tax cuts cost the government money:

Tax cuts do provide economic stimulus, but every economist who doesn't work for a right-wing think tank agrees that it's a weak stimulus compared to direct spending--you get a lot less economic bang for your government buck. More importantly, STIMULUS IS FOR FIGHTING RECESSIONS. When the recession ends, so should the stimulus. I'd be a lot more sanguine about the present round of cuts if I didn't know damn well that Republicans will try to make them permanent again two years from now.
Dec. 16th, 2010 08:41 pm (UTC)
Re: Actually
Why do you bring up 2001? Bush cut taxes in 2003.

If you really think government spends money more efficiently than private individuals and businesses, what about $10,000 for a toilet seat? What about spending 6 figures PER job for Obama's failed stimulus? (by Obama's math, independent people put the cost at almost 7 figures).

Do you understand what moral hazard is?

When a government paper pusher is spending our money, not his, he is not that frugal with it. The government overpays for practically everything.

Whereas you or I care when we get ripped off, the bureaucrat does not, it isn't his money.

Government spending very rarely gets dollar value like private spending does.

Dec. 16th, 2010 09:15 pm (UTC)
Re: Actually
"Why do you bring up 2001? Bush cut taxes in 2003."

"If you really think government spends money more efficiently than private individuals and businesses, what about $10,000 for a toilet seat? What about spending 6 figures PER job for Obama's failed stimulus?"

If the goal is to maximize utility for those spending the money, then yes, private individuals do typically spend more efficiently than government. If your goal is to improve the personal well-being of people making $250K+ a year, then cutting their taxes is an excellent way to go about it.

If, however, your goal is to create jobs, then no, cutting taxes on the wealthy (and $250K a year is wealthy by any sane standard) is not as efficient as direct government spending, because the wealthy are likely to save that money rather than spend it to hire people. This is no criticism of them--it's the rational thing to do from their perspective. But it doesn't help the economy.

Right now, consumers are feeling the pinch and so have cut back on spending. Hence, businesses cannot sell as many goods. In such an environment, any company would be foolish to expand operations, so they sit on their cash, waiting for prospects to improve. This prolongs the pinch for consumers, perpetuating the situation.

Direct spending by the government can raise demand and break the cycle; and as long as the economy has a lot of slack capacity, government spending will take up that capacity rather than crowding out private spending. Only once the economy is back up to full employment does crowding-out become a concern.
Dec. 16th, 2010 03:08 am (UTC)
Re: Actually
the Clinton-era surplus may have had just a *bit* to do with the Internet bubble...

But agree that the Bush tax rates did not self-fund through created growth - but hard to tell against the train wreck the economy was becoming in 2001 and then recently. Perhaps it would have been worse without them. No idea. Haven't seen many economists claiming they could tell either.


George R.R. Martin
George R. R. Martin

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