Why doesn’t Obama know?

When the WH economists know that Bush Tax cuts are not responsible for deficits? Here is the pertinent section:

Turn to Pages 411-413 of his 2012 Economic Report of the President, published by the Council of Economic Advisers. They show that “the math,” as Obama is wont to say, in fact does add up for tax cuts.

After President Bush in late May 2003 signed the largest tax cut since President Reagan — including dropping the top marginal rate to 35% from 39.6% — government receipts from individual income taxes rose from $793.7 billion to a peak of $1.16 trillion in 2007, when the mortgage crisis began, a 47% jump.

Stronger economic growth expanded the tax base and brought in so much revenue that Bush more than halved the deficit over that period. The budget gap plunged to $160.7 billion from $377.6 billion, according to the president’s report.

Below is the graph from this report. It leaves no room for doubt that the Bush Tax cuts not only increased government revenue, but that the annual deficits where going down because of that.

BushTaxCutsNarrowedDeficits

Bush Tax Cuts Narrowed Deficits

The question begs to be asked why the class warriors, like the commenters here that have been arguing otherwise on another post, despite many people providing this evidence, pretend otherwise? Note that the deficits do not jump again until the mortgage crisis starts, and then it is also important to point out that spending, which originates from the US House of Representatives, was controlled by the democrats whom owned the house.

Anyone that argues that tax cuts reduce government revenue is not arguing out of good faith. In every instance where the feds cut taxes, Kennedy, Reagan, and GWB, government ended up collecting more money. That happened because the greedy capitalists, from the stinking rich to the guy with a cool small business idea, put their money to work – they wanted to make more – and the economy took off like a bat out of hell.

So ask yourself this: why would these class warriors be so hell bent on forcing the issue of hiking taxes, during an anemic economy that despite all their efforts remains so and promises to only get worse of all cases, knowing these details? What’s the logic behind this? When every economist worth their salt says tax cuts produce more revenue and grow the economy, wouldn’t you expect the people in charge, especially if they really want to fix the economy, want to do more of that? And when stimulus after stimulus fails, wouldn’t the Keynesians be forced to rethink their nonsense? More importantly, why do democrats want to keep things as chaotic as they have made them when they know what we need right now the most is stability?

The current policy the left wants clearly will bring more pain, and yet, that’s what they are hell bent on giving us more off. Ask yourself why. Is it just ideological? Or is there more?

  1. Alex, to make this argument work, you would have to show that the increase in tax revenues was the direct result of the tax cuts and not of other factors. Just for example, the Bush administration increased deficit spending rapidly over the period when tax receipts increased, which would also have had a substantial effect on tax receipts. Have these figures taken this into account? Would the economy have grown anyway had there not been tax cuts, giving a better chance of reducing deficit spending (benefit of hindsight notwithstanding)?

    You’d also have to steer clear of the possibility that the tax cuts contributed in some way to the housing bubble by driving up property prices.

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  2. I’ve never forgotten Pesident Kennedy’s speech at the Economic Club of New York on December 14, 1962 (it got me an A in Econ that year.) He was right then, it has been true ever since then and it will ALWAYS be true. Sadly, half the people who know this will continue to fight it in order to get the loot.

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  3. Alex, to make this argument work, you would have to show that the increase in tax revenues was the direct result of the tax cuts and not of other factors.

    I have to do no such thing, Stogy. Besides, economists, like Thomas Sowell and Walter Williams, just to name a couple, have done this repeatedly, and with far more convincing logic than I could ever muster, only to have people like you, whom for political reasons refuse to accept this economic reality because of ideology and envy, pretend that the proof isn’t there.

    The short answer is that people like you will accept nothing as proof that your combination of Marxist and Keynesian fantasy economics don’t work. That’s why people like you still pretend, after multiple examples, not just here in the US, but globally, that lowered tax rates, in a well defined frame that allows businesses to clearly understand the long term implications and then maneuver to take advantage of these rules, spur investments, cause economic expansion and growth, yield higher wealth creation, and then directly produce higher tax revenues for government.

    Conversely, it is well known that doing the opposite results in people taking action to protect their assets and reduced government revenue. And Team Obama knows this is a fact. Just look at the post I made about how they want more “stimulus” to offset what they know will hammer the economy. Of course, as is always the case with the class warriors, the ‘stimulus” really is stolen wealth used to help protect their constituencies. Don’t take my word for it, look at how effective that trillion dollar patronage project was and who benefited from that government largess, at the tax payer’s expense.

    The problem here isn’t that the economic model that shows lower taxes produce economic growth and more revenues isn’t proven: it is that you, and people like you, refuse to accept the proof it works that way. And that’s because doing so would demolish your ideological class warrior beliefs and agenda. Just like you refuse to see that after 60 years of the idiotic “War on poverty” wealth redistribution scheme, countless failed Keynesian “stimulus” projects, and the economic uncertainty, and especially punitive anti-business policies of the past 4 years, your sides’ thinking and policies have produced nothing but more poverty, ever growing, out of control debt, wealth destruction on an unimaginable scale, but most important of all, a massive growth in an ineffective and inefficient government that then drastically reduced freedom (the real kind, not the liberal version which means you are free of consequences of stupid actions and decisions, because the nanny state is there to be your mommy and daddy) for the productive.

    The definition of insanity is doing the same thing over and over, knowing what the outcome will be, and still expecting otherwise. That’s where the left is now. They basically want to ignore the fundamental and basic laws of economics and human nature, because they believe they should be able to force their stupid beliefs onto reality. Social engineering sucks, and sooner than later, has failed or will fail every damned time it is tried. The proof is mountainous, and yet people like you demand we keep letting you do more of it because you want to keep the vote buying schemes and the gravy train at other people’s expense going.

    You’d also have to steer clear of the possibility that the tax cuts contributed in some way to the housing bubble by driving up property prices.

    What nonsense. You are now desperately looking for excuses to make the argument that even if tax cuts produce economic growth and more revenue, we should stick to the bullshit policy of the class warriors, no matter how destructive they are. Weak!

    The housing bubble was caused by the idiotic belief that you could social engineer irresponsibility and lack of economic discipline into people prone to bad choices. Government forced lenders to give out loans to people that should never have even been even considered, under penalty of losing their business, because it thought that somehow owning a home would magically transform economic illiterates and people prone to bad decisions, into responsible ones. Then, when it became obvious even this level of coercion wasn’t enough, the agents of social engineering in government got in bed with the lenders, promising them tax payer funded bailouts if things went south, while passing a slew of laws that encouraged the industry to treat junk mortgages as golden eggs. When others pointed out we were headed for a disaster they were silenced with accusations of racism.

    Then when the shit hit the fan, the people behind the problem pretended it was not their fault. First they blamed lack of regulations, instead of the fact that we had the ones they put in place that were directly responsible for the problematic behavior, and demanded the “right” to fix it. That’s those two clowns Dodd and Frank, whom straddled us with a 2000 page economy crushing tome, which as expected not only didn’t address the underlying problem, but guaranteed the tax payer would yet again be on the hook to bail the whole thing out somewhere down the line when the house of cards collapsed yet again.

    Now we have people like you trying to make an idiotic and ludicrous connection to tax cuts because you desperately need to pretend tax hikes are not going to cause economic problems. How pathetic.

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  4. That analysis is pure garbage. First of all, what about the 2001 tax cuts? That was the first wave of tax cuts, not the 2003 tax cuts. So they already full of shit. Second, you can’t ignore that the revenues were bloated by a gigantic housing bubble. Are we going to sit around and pretend that giving huge tax breaks to home sellers had nothing to do with this? Oh yeah, I forget. It was ACORN and Jimmy Carter who created credit default swaps.

    Look at revenues as a percentage of GDP. Before Bush, they peaked at 21%. After the tax cuts, they fell to 16%, rose back to 18%, then plunged to 15% during the financial crisis. A huge part of that is because he removed millions of middle-income people from the tax rolls, making revenues far more dependent on the economy. We have not seen such wild swings of revenue since before WW2.

    Bush’s tax cuts MIGHT have been justified had they been supply-side cuts. But they were not. They were not targeted. They were not focused. They were almost random and mainly designed politically. Their role in creating the budget mess we are in is clear. And it is the architects of supply side economics — some of the economists you site — who said so at the time.

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  5. Also, as a counterpoint, from 1982 to 1994, taxes were raised six times — four by Reagan, one by Bush, one by Clinton. And, yet, somehow, we had a sustained economic boom for almost twenty years. And, unlike the Bush II “economy”, this one DID lift all boats.

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  6. Marxist and Keynesian fantasy economics don’t work

    I am neither a Marxist, nor a strict Keynesian. I am not sure how you reached that conclusion. I am completely willing to hear you out provided you make well sourced, logically consistent arguments, and you do on occasion manage to deliver. I didn’t make any arguments in the above comments – I only asked you to justify your conclusions, which you have actually done.

    Hal has made some other comments about the budget deficit and spending. I wanted to focus on the broader political issues behind taxation, as you otherwise seem to have to make up my positions for yourself.

    I generally am skeptical of Keynesian economics, because it doesn’t work unless you pay down the debt when times are good, something that few governments have the fiscal discipline to do. European governments, had they followed this rule, wouldn’t be in the crapper like they are now if they had only reduced spending and paid down debt in the early 2000s, and then there would have been stimulous money available at low credit risk for ensuring that the economies didn’t contract too far. The US government didn’t do much better under the Bush administration, and the Obama spending spree was not particularly well-targeted. The Australian governments of the past 20 or more years (both from the left and right) are the major exception to the rule – stimulus when the economy needs it; surpluses when it doesn’t. They were helped along by mining booms and growth in China though.

    Thanks for citing Sowell and Williams. Any pointers on where I should start reading them? Some references would have been nice. Amazon won’t deliver to my current location, so online sources would be better. I am wondering how they deal with social and economic inequalities that inevitably arise from trickle-down, low-taxation only approaches. When times are good and economies are growing, this generally isn’t a big problem, but when things get screwed as they inevitably do, then

    Rather than seeing taxation as stealing from the rich, my ideal taxation policy would be one that promotes social goods. The biggest problem with a purely Marxist approach is that everyone gets an equal share and that it provides no incentive – something I am sure you would agree with. This would be represented as a perfect 0 on a GINI co-efficient, were that ever possible. The result is almost complete economic stagnation. However the other extreme is also true: A GINI co-efficient of 1 also produces no incentive. No-one works hard if they think that someone has all the money and isn’t going to share it with them. The result is starvation wages and stagnation. Worse though, is that when people see no way of getting ahead, they’ll resort to crime, violence and revolution (see France in 1889 and Russia in 1917, and more recently, Brazil and Venezuela in the 90s). The few rich need a powerful security force to stop the poor from taking their wealth from them, and then when they do, you end up with Castros and Chavezs. This is the curse of the right, and the reason why purely capitalist systems will always fail.

    So I would argue for a balance. Taxation systems should promote a balance between social equity and incentive (this is probably the sentence you are going to attack, but so be it). Healthy economies have lots of money at the top and enough at the bottom for people to spend at a level a little beyond their basic needs – enough to provide incentive.

    Social engineering sucks, and sooner than later, has failed or will fail every damned time it is tried.

    This is why we need (and mostly have) a left-right political system. I certainly wouldn’t trust any one party to be able to find that balance. Both socially engineer. Everything you have said above is also a form of social engineering. Your ‘hands off’, laissez faire economics is still a form of social engineering in that corporate capitalism is the primary driver of social wellbeing. It’s no more natural than any other form of economic system all the way back to bartering.

    You are now desperately looking for excuses to make the argument that even if tax cuts produce economic growth and more revenue, we should stick to the bullshit policy of the class warriors, no matter how destructive they are. Weak!

    Did I make that argument? Actually, the point I would have made (but didn’t) is that tax cuts for the rich very often push market rates up at the top end of the property market, as everyone simply tried to move to a better address. It doesn’t actually add wealth to the economy. This happens absolutely everywhere, not just the US with the housing mortgage system, and is a really good argument for bigger tax breaks for reinvestment in businesses. And yes, that’s a form of social engineering too.

    Government forced lenders to give out loans to people that should never have even been even considered, under penalty of losing their business, because it thought that somehow owning a home would magically transform economic illiterates and people prone to bad decisions, into responsible ones.

    I wasn’t actually talking about this at all.

    Now we have people like you trying to make an idiotic and ludicrous connection to tax cuts because you desperately need to pretend tax hikes are not going to cause economic problems. How pathetic.

    No. You have misunderstood my argument. It would really help us both if you wouldn’t make up my positions for me. Now you have my positions, so fire away! I’ll read your cited authors.

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  7. That analysis is pure garbage. First of all, what about the 2001 tax cuts? That was the first wave of tax cuts, not the 2003 tax cuts. So they already full of shit.

    I guess 9-11 never happened huh? Of course, I am not surprised you miss that, on purpose. And thanks for yet again showing your bonnafides, Hal. I know where you stand on this tax issue.

    Second, you can’t ignore that the revenues were bloated by a gigantic housing bubble.

    Are you seriously going to make this ludicrous argument? Do you apply the same logic to the Clinton economies and the Tech bubble? WTF? What about the fact that we still have a housing bubble, a student load bubble, and a credit card bubble at this time under Obama? Does that mean that revenue is artificially high and Obama should actually be baselinging his spending on all three going south? Talk about stupid.

    Are we going to sit around and pretend that giving huge tax breaks to home sellers had nothing to do with this?

    WTF are you talking about? What is the “this” you refer to? Can you correlate how income tax reductions affected buyers & sellers? Or is your point that it was capital gains taxes that went down? I may have it wrong, but I distinctly remember that the ONLY people that qualified for any kind of big tax deduction were the FIRST TIME buyers & sellers, and then on primary residences. Pretending that the economy was totally boosted by tax breaks that allowed wheeler and dealers, and then solely in the housing market, to make a killing is the height of hypocritical stupidity. So maybe you want to get a clue and some perspective, and not try to defend such a ludicrous and blatant talking point.

    Let me stress that even if there had been no regulation whatsoever dealing with repeat buying/selling of property, that you only would have a point if the only people that got tax breaks where in real estate and our economy completely revolved around that. But the fact is that while real estate accounted for a lot of the wealth, most of it was elsewhere. Try again.

    Oh yeah, I forget. It was ACORN and Jimmy Carter who created credit default swaps.

    No it was Dodd and Frank that did that. Jimmy Carter signed into law the stupid attempt at socio engineering financially responsible people through homeownership a long time ago and had nothing to do with the swaps. ACORN is into voter fraud, explaining how to hide income from illicit and illegal activities, and other such criminal activities, and has nothing to do with that either. You fail.

    Look at revenues as a percentage of GDP. Before Bush, they peaked at 21%. After the tax cuts, they fell to 16%, rose back to 18%, then plunged to 15% during the financial crisis. A huge part of that is because he removed millions of middle-income people from the tax rolls, making revenues far more dependent on the economy. We have not seen such wild swings of revenue since before WW2.

    I will grant you that removing people from the tax rolls was a huge mistake. But I absolutely LOVE the idea that government revenue is tied to the economy. It should incentivise government to make choices that help grow the economy. On second thought, after the last 4 years maybe this is a terrible idea when democrats are in power, since they care more about spreading the wealth than the economy.

    Bush’s tax cuts MIGHT have been justified had they been supply-side cuts. But they were not.

    Got it. You believe the money was the government’s in the first place and that it is a crazy idea to let people keep more of what they earn if it jeopardizes government’s ability to spend big money.

    They were not targeted. They were not focused. They were almost random and mainly designed politically.

    So, to use your words – which in no way means I agree with what you are saying – random cuts that affect everyone are political, but hikes on the rich, that’s good economics. You are laughable.

    Their role in creating the budget mess we are in is clear.

    Absolutely: we are spending far more than we can or should collect, and they did the same, albeit not to the tune of $1 trillion plus per year, like the current crop of crooks is doing though. People like you, who make a living off government cheese will differ in opinion, I bet.

    And it is the architects of supply side economics — some of the economists you site — who said so at the time.

    Are you seriously going to tell me that I have not been pointing out that things can not keep going on as they are right now? My point is that the issue is and ALWAYS will be the spending., and we are SPENING too damned much. And you can bet your ass the spending is happening for political purposes: it buys them votes.

    The class warriors can raise taxes on everyone by 50% – adding new taxes to people paying none now – and it would do nothing, because they would then turn around and jack up spending. I have already pointed out that if we want to be a two-bit Euro-socialist nanny state, we will have to tax everyone like the Europeans do. And that still will not be enough to cover what they want to spend.

    The point is that these tax hikes that Team Blue wants are political, and in the end they won’t address the problem at all, because Team Blue only wants more spending, and no cuts unless it is from defense. I for one would prefer not to let them take more of what I earn while not solving the spending problem, but that’s just me being stupid and expecting sound economic polict, I guess.

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  8. I am neither a Marxist, nor a strict Keynesian.

    Oh bullshit. And you are a few cards short of a full deck too.

    I am not sure how you reached that conclusion.

    The nonsense you believe in?

    I am completely willing to hear you out provided you make well sourced, logically consistent arguments, and you do on occasion manage to deliver. I didn’t make any arguments in the above comments – I only asked you to justify your conclusions, which you have actually done.

    I guess you are a liar too.

    Hal has made some other comments about the budget deficit and spending. I wanted to focus on the broader political issues behind taxation, as you otherwise seem to have to make up my positions for yourself.

    No, Hal just showed us a healthy dose of his BDS and his lefty bonnafides.

    I generally am skeptical of Keynesian economics, because it doesn’t work unless you pay down the debt when times are good, something that few governments have the fiscal discipline to do.

    Make that none have the discipline, and you would have the facts right.

    European governments, had they followed this rule, wouldn’t be in the crapper like they are now if they had only reduced spending and paid down debt in the early 2000s, and then there would have been stimulous money available at low credit risk for ensuring that the economies didn’t contract too far. The US government didn’t do much better under the Bush administration, and the Obama spending spree was not particularly well-targeted.

    That is some parsing there dude. Heh, Obama’s spending wasn’t well targeted. I beg to differ. The money went to exactly the people Obama wanted it to go to.

    The Australian governments of the past 20 or more years (both from the left and right) are the major exception to the rule – stimulus when the economy needs it; surpluses when it doesn’t. They were helped along by mining booms and growth in China though.

    At least you acknowledge they had a lot of help, and are in a unique situation.

    Thanks for citing Sowell and Williams. Any pointers on where I should start reading them? Some references would have been nice. Amazon won’t deliver to my current location, so online sources would be better.

    Google the names. These guys are well published. Eh, what the hell. Here is Sowell, and Here is Williams.

    I am wondering how they deal with social and economic inequalities that inevitably arise from trickle-down, low-taxation only approaches. When times are good and economies are growing, this generally isn’t a big problem, but when things get screwed as they inevitably do, then

    They deal with it in the right way, by showing that it is a false and impossible construct bound to fail, sooner than later, as it has everywhere. I am sure you are not going to like it, but they both nail it.

    Rather than seeing taxation as stealing from the rich, my ideal taxation policy would be one that promotes social goods.

    Boy is this one statement replete with nonsense. How seriously would you take the guy that tells you he would rather the women he forces myself on for sex not accuse him of rape, but see it as him spreading love? That’s the basic logic you have here. And who decides what is socially good? Or how much money is OK to for anyone to make, and conversely for government to take from whomever? Not to mention the fallacy that government can do good considering the ample proof of how inefficient and bad what government does is. We have had 6 decades of “War on poverty” and have more poverty than ever despite insane government spending to combat it. No program to help people should make them dependant on said program forever like practically every one of these do good programs do. We have generations of people living on the dole and we encourage more of it by giving them more every time some politician needs to buy votes.

    People like you want to pretend they are Robin Hood, but then they fail to remember that in that story, Robin Hood fought an oppressive government and over bearing taxation.

    The biggest problem with a purely Marxist approach is that everyone gets an equal share and that it provides no incentive – something I am sure you would agree with. This would be represented as a perfect 0 on a GINI co-efficient, were that ever possible.

    You mean on paper right? In practice some Marxist, like in Orwell’s book, were more than others. The bastard children of Marxist ideology that pretend other forms of “sharing” are better and then claim not to be offshoots of Marxism are not much better. All run into the same problem: human nature.

    The result is almost complete economic stagnation.

    I see where this is going. Marxism-light, no matter what the name is, is more of the same.

    However the other extreme is also true: A GINI co-efficient of 1 also produces no incentive. No-one works hard if they think that someone has all the money and isn’t going to share it with them. result is starvation wages and stagnation. Worse though, is that when people see no way of getting ahead, they’ll resort to crime, violence and revolution (see France in 1889 and Russia in 1917, and more recently, Brazil and Venezuela in the 90s).

    This is where Marxists fail: they think the wealth pool is finite and someone has to lose for others to win. Sowell and Williams both are masters at illustrating how big of a fallacy thinking like this is, and why it produces the failures it does every damned time people try to “do the just thing”.

    The The few rich need a powerful security force to stop the poor from taking their wealth from them, and then when they do, you end up with Castros and Chavezs. This is the curse of the right, and the reason why purely capitalist systems will always fail.

    This nonsense is Marxism 101 dude.

    So I would argue for a balance. Taxation systems should promote a balance between social equity and incentive (this is probably the sentence you are going to attack, but so be it). Healthy economies have lots of money at the top and enough at the bottom for people to spend at a level a little beyond their basic needs – enough to provide incentive.

    Wait a fucking second here? Do you think that what I am arguing for is no government? No Stogy, what I am saying is that I want our federal government to remain limited to what the constitution says it is, and to take only what it needs to legally fulfill those obligations. Leave the other things to the states as it was intended. Especially the social engineering. Considering how well it has worked out for California, Illinois, NY, and other such hard core blue states that share your outlook, I think everyone would quickly see this “social equity and incentive” bullshit for what it is: bullshit. Government should NOT be in the business of picking winners and losers, EVER, unless it is because it is at war. Look how well that has worked for the tax payers in the US the last 4 years.

    This is why we need (and mostly have) a left-right political system.

    What we have is nanny staters both on the left and right, and a country barreling over the cliff because the political class uses the serfs depending on government for their daily subsistence to keep power. And yet, people like you are more perturbed and pissed at the rich than these monsters.

    I certainly wouldn’t trust any one party to be able to find that balance.

    You think I do? What I do know is that democrats are bad for everyone but democrat politicians and their buddies, while pretending the problem is the other side. They are marxists and fascists in sheep’s clothing. It’s the whole lesser of two evils thing. And I certainly find nothing fair in a government that thinks it has the right to take more from me, under the ridiculous pretense that it is doing so to help others, because it insists on living beyond its means so it can keep buying votes for one political party.

    Both socially engineer.

    I would prefer neither do it.

    Everything you have said above is also a form of social engineering.

    Huh? Now letting people keep their own income and demanding government live within its means is social engineering? Damned you marxists are confusing me.

    Your ‘hands off’, laissez faire economics is still a form of social engineering in that corporate capitalism is the primary driver of social wellbeing. It’s no more natural than any other form of economic system all the way back to bartering.

    Actually I would like the laws of economics and human nature to do their thing. This nation became exceptional and wealthy because of that. The social justice crowd is actively trying to destroy that exceptionalism and wealth. Bartering works because the parties involved know what’s in their best interest. Read Sowell and Williams, I tell you.

    No. You have misunderstood my argument. It would really help us both if you wouldn’t make up my positions for me. Now you have my positions, so fire away! I’ll read your cited authors.

    It would help our discussion even more if you didn’t believe in fairy tales and actually understood economics and human nature.

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  9. Thanks for the reply, Alex. Although I could have done without the personal attacks. There were a number of points where we actually agreed, which I think is a first.

    It’s going to take me a while for me to get to Sowell and his pal, so perhaps you could give me a brief idea of how they address the core problem, because you didn’t really deal with this.

    This is where Marxists fail: they think the wealth pool is finite and someone has to lose for others to win. Sowell and Williams both are masters at illustrating how big of a fallacy thinking like this is, and why it produces the failures it does every damned time people try to “do the just thing”.

    At no point did I argue that the economy is a zero-sum, winner-loser game. Wealth is obviously not an absolute finite, but the product of demand and supply. An oversupply of labor leads to lower salaries just as an oversupply of corn leads to lower prices.

    The country I live in now has an enormous gap between the wealthy and the poor. Productivity is low largely because those at the bottom see that however hard they work, there is very little they can do to change their social and economic position. The best way for those at the bottom to move out of poverty is to jump a ship heading elsewhere, but mostly they are caught and sent back. The GINI coefficient is high (though nowhere near Brazil’s), and getting higher every year, meaning that the situation for the poorest of the poor is getting relatively worse each year. Wages are brutally low, for many people just above starvation levels. All around them, they see wealth and privilege, and the wealthy use the power that it brings to vote themselves fancy tax breaks and more privileges. This has lead to repeated attempts to overthrow the government, a high murder rate and stagnation. Perhaps 100,000 people have died over the past half century due to economic and social violence caused by inequality. There is no mechanism here for betterment for those at the bottom.

    So how do you creative incentive when a high GINI co-efficient indicates that wealth is massively centralized in the hands of a very few. And if you are going to argue instead (as I think you are) for a kind of social/economic Darwinism (government has no business picking winners and losers), then are you prepared to deal with the eventual election of more socialist governments, who people may perceive will give them a better chance to change their position. And where that doesn’t happen, the consequent violence and social upheaval?

    Saying this is a Marxist 101 analysis doesn’t really constitute an answer. I am thinking more in terms of structural strain theory (in which people see no other alternative than crime or violent overthrow to achieve the desired social value of wealth and status).

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  10. There is not conclusive evidence, however, to substantiate a clear relationship between the 65-year steady reduction in the top tax rates and economic growth. Analysis of such data suggests the reduction in the top tax rates have had little association with saving, investment, or productivity growth. However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution. The share of income accruing to the top 0.1% of U.S. families increased from 4.2% in 1945 to 12.3% by 2007 before falling to 9.2% due to the 2007-2009 recession. The evidence does not suggest necessarily a relationship between tax policy with regard to the top tax rates and the size of the economic pie, but there may be a relationship to how the economic pie is sliced.

    http://www.dpcc.senate.gov/files/documents/CRSTaxesandtheEconomy%20Top%20Rates.pdf

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  11. Boy is this one statement replete with nonsense. How seriously would you take the guy that tells you he would rather the women he forces myself on for sex not accuse him of rape, but see it as him spreading love? That’s the basic logic you have here. And who decides what is socially good? Or how much money is OK to for anyone to make, and conversely for government to take from whomever?

    Sorry, one other point, The rape analogy is false. It’s not theft because it’s part of a social contract. We give up freedoms (including a percentage of income as tax) in order to live in a society which protects us, educates us and provides us with rights. You don’t agree with something, then you have opportunities to change it – but everyone else has exactly the same rights as you. As to who decides what is socially good, and how much we should pay in tax? We do. Through democratically elected representatives. Prior to that, we had kings, dictators and feudal lords who took whatever they wanted regardless of the cost to the community.

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  12. Sorry, one other point, The rape analogy is false. It’s not theft because it’s part of a social contract.

    Really Stogy? Even if I had no say in said contract or my being bound to it? Last I recall forced contracts kind of aren’t that much higher on the scale of bad than slavery. When you tell me I have no say in how much you want to confiscate from me, no matter what or how noble the reason, it is wrong. What if someone tell you they need both your kidneys and your heart, for the greater good, you know? or maybe that you are too old and too costly to keep alive, so they are going to make baby food out of you. After all, there are others that are more deserving of the limited resources. How would you feel about that kind of social contract? And yes, what we have ow is just as bad as either of these scenarios. You don’t feel it is because you aren’t one of the people that is going to get fleeced.

    I do not accept the concept, let alone the social contract, as it exists today, because I do not believe the people that pretend they are doing it for the good of us all really even believe their lie about it. The fact that a government that already takes trillions away from people says it needs trillions more, and all we get is more crap should make anyone question the contract. Well, anyone but the takers: they are making out like bandits.

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  13. Exactly.
    Rape comparisons are just another ‘Godwin’. Just like personal abuse is a sure sign of fragility.

    ….while passing a slew of laws that encouraged the industry to treat junk mortgages as golden eggs….

    You should read this Alex.

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  14. After all, there are others that are more deserving of the limited resources.

    Alex, this has actually happened. And then we had a civil rights movement. The contract got stronger.

    You’re absolutely right to question it, but ultimately, it’s the curse of Socrates. It’s something that you can only change from the inside of a system which has already delivered you substantial benefits, whether you recognize them or not. You are who you are as a result of the system. You succeed in changing it, or you accept your fate.

    Hemlock doesn’t taste that bad, I am told.

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  15. Rape comparisons are just another ‘Godwin’.

    Yeah, I kind of gave him a free pass on that, didn’t I?

    Thanks for the Sowell links. I found some interesting stuff, although nothing really to answer my question (as yet).

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  16. I do not accept the concept, let alone the social contract….

    If you’ve voted, that’s evidence that you do accept the contract (you have supported the mix of policies put forward by the party you voted for).

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  17. Thanks for the Sowell links. I found some interesting stuff, although nothing really to answer my question (as yet).

    No worries. I’ve not found anything useful yet. His columns seem to be just more paint-by-numbers ideological pieces.

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  18. Alex, I’d really like you to have a crack at my question from 3.02pm if you’ve got time. You may have missed it. I’ll try to leave you alone after that.

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  19. No worries. I’ve not found anything useful yet. His columns seem to be just more paint-by-numbers ideological pieces.

    Coming form you this is just setting the bar at its possible highest for irony, CM. Thanks for the laugh dude.

    Like I said: those that refuse to accept how the real world works will always have to make excuses for why their brilliant and noble plan didn’t work this time around, yet again.

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  20. No worries. I’ve not found anything useful yet. His columns seem to be just more paint-by-numbers ideological pieces.

    he is a lot less extreme in his views than Alex. But it’s useful to be able to quote from more conservative sources, particularly those whose arguments are considered worthy. I thought this illustrated one of my points very well:

    Focusing attention and attacks on people who have greater wealth-generating capacity — whether races, classes or whatever — has had counterproductive consequences, including tragedies written in the blood of millions. Whole totalitarian governments have risen to dictatorial power on the wings of envy and resentment ideologies.

    However, he blames academics for pointing out the problem. Perhaps it’s better to keep people ignorant of their poverty in order to stop them rocking the boat for the rest of us – and, as he says, expecting all classes and races to achieve the same things was obviously unrealistic. He’s right to say that there are many people who use anger at inequality for their own ends. But you’re right – it’s hardly earth-shattering stuff. I hope his books are a little better.

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  21. Coming form you this is just setting the bar at its possible highest for irony, CM. Thanks for the laugh dude.

    You seem like you need a laugh, so if I’m helping out on that score, that’s cool.

    Like I said: those that refuse to accept how the real world works will always have to make excuses for why their brilliant and noble plan didn’t work this time around, yet again.

    Which is why ideology is silly.

    I hope his books are a little better.

    We’d have to assume so. Likewise, I wouldn’t expect anyone to judge the validity of Krugman’s Nobel Prize on the basis of his NYT column.

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  22. Here you go Stogy.

    The country I live in now has an enormous gap between the wealthy and the poor. Productivity is low largely because those at the bottom see that however hard they work, there is very little they can do to change their social and economic position.

    Is this what you think I am advocating for Stogy? And why is the choice between socialist utopia or a dog-eat-dog world? Do you think I want a system where the rich get richer and the poor are serfs? To be honest, that is my main objection to what the left does: they pretend to want to do good, but all I see is a slew of people living off the dole and the really rich, not the ones trying to get rich, the really obscenely rich, get richer. In case you missed it the real power brokers in this country have made out like bandits, while the middle class was devastated. Obama wasn’t accused of being the food stamp president for nothing. I want a system that is fair for everyone and that lets me enjoy the fruits of my labor without punishing me because I was blessed with bettter brains, a good work ethic, or even luck. We can not all cross the finish line at the same time, and any attempt to force that will fail. That’s a fact.

    The best way for those at the bottom to move out of poverty is to jump a ship heading elsewhere, but mostly they are caught and sent back. The GINI coefficient is high (though nowhere near Brazil’s), and getting higher every year, meaning that the situation for the poorest of the poor is getting relatively worse each year. Wages are brutally low, for many people just above starvation levels. All around them, they see wealth and privilege, and the wealthy use the power that it brings to vote themselves fancy tax breaks and more privileges. This has lead to repeated attempts to overthrow the government, a high murder rate and stagnation. Perhaps 100,000 people have died over the past half century due to economic and social violence caused by inequality. There is no mechanism here for betterment for those at the bottom.

    So your answer to this dilemma isn’t to reform the government and set up a system of laws that protects individual, property, and human rights, but to resort to wealth redistribution? What gives you the impression this will solve any problems? Historically wealth redistribution has served no good to address inequalities, and practically always made things worse. Ask the Soviets.

    Here is a simple hypothetical for you. If we could magically and fairly redistribute all wealth tomorrow so that everyone had the same, would you be surprised that by the end of the month we would have the great majority of the people whining about wanting a do-over because they are back to where they were when this started?

    The problem with wealth redistribution, which is fundamentally the same underlying one that caused our housing bubble break, is that it seeks to fight human nature. People prone to bad decisions are going to make them regardless of what you do for them. Give a person that makes decisions based on immediate gratification a ton of cash, and you will sooner than later have him come back for more, often with absolutely nothing to show for the cash you gave them. Look at what happened during Katrina with the government handouts of every kind. Ignoring this reality is a recipe for the disaster we find ourselves in today.

    So how do you creative incentive when a high GINI co-efficient indicates that wealth is massively centralized in the hands of a very few.

    The first thing you need is a system of law that guarantees individual and property rights. Upon that system you build one that protects the workers from abuse by granting those that do good work the ability to get decent pay. You reward hard work, saving, and common sense, provide education opportunities, and finally limit regulation to what is needed to make sure those that want to create wealth can do so. It won’t be fool proof. Some people will still fall through the cracks, be it due to their own mistakes or plain bad luck, but the majority should prosper. BTW, if this story sounds familiar, it is because it is what happened in the US.

    And if you are going to argue instead (as I think you are) for a kind of social/economic Darwinism (government has no business picking winners and losers), then are you prepared to deal with the eventual election of more socialist governments, who people may perceive will give them a better chance to change their position. And where that doesn’t happen, the consequent violence and social upheaval?

    I do not believe in or advocate for social Darwinism. Why is it that you assume I do so? Because I point out that I have a sever phobia of giving government the power to choose winners and losers? I mean it is not like government could actually just be an arbiter and enforcer of just laws instead of what we have today where government passes laws to force outcomes they perceive as being right. The fact that it is wrong for government to try and pick who wins and who loses is why we have billions of wasted tax payer dollars bailing out banks, propping up green energy, or going to other such pet projects of the left. We as the citizens should have never let them get that power.

    Saying this is a Marxist 101 analysis doesn’t really constitute an answer. I am thinking more in terms of structural strain theory (in which people see no other alternative than crime or violent overthrow to achieve the desired social value of wealth and status).

    Anyone that wants to use government to redistribute wealth or force certain social outcomes that are adverse to the basic laws of economics and human nature is basically doing what the marxists want/believe in, and doomed to fail.

    The system that produces wealth, for all, isn’t a mystery. The problem is that such as system doesn’t give the political class the ability to drastically enrich itself while garnering incredible power, even over life and death (healthcare), and thus sold as a failure by the people that prey on the greed and envy of the masses.

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  23. Like I said: those that refuse to accept how the real world works will always have to make excuses for why their brilliant and noble plan didn’t work this time around, yet again.

    So where does this leave your plan to collapse the global system and repudiate all international treaties because it doesn’t fit with your rejection of the whole concept of ‘global governance’?

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  24. Historically wealth redistribution has served no good to address inequalities

    Well no, for the entire middle of last century, when tax rates where high and ‘wealth distribution’ was at it’s highest (involuntarily via higher taxes and voluntarily via companies paying a higher proportion of their reveunes in staff wages) inequalities were at their lowest. Only when tax rates were reduced did inequality start rising.

    Of course what you mean is extreme wealth distrubution, because you’re always forced to put forward an extreme position to try and support what you say.

    Anyone that wants to use government to redistribute wealth or force certain social outcomes that are adverse to the basic laws of economics and human nature is basically doing what the marxists want/believe in, and doomed to fail.

    You’re advocating for something close to an ideological system. I agree with Stogy when he noted that human nature doesn’t allow ideologies to work in practice. There needs to be some balance to account for human nature. Western societies are all variations of this balance because people aren’t prepared to go too far one way or the other.

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  25. The system that produces wealth, for all, isn’t a mystery. The problem is that such as system doesn’t give the political class the ability to drastically enrich itself while garnering incredible power, even over life and death (healthcare), and thus sold as a failure by the people that prey on the greed and envy of the masses.

    There is no ideological system that produces wealth for all.

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  26. Is this what you think I am advocating for Stogy? And why is the choice between socialist utopia or a dog-eat-dog world?

    You’re right, it’s not. Exactly as I have been saying.

    that is my main objection to what the left does: they pretend to want to do good, but all I see is a slew of people living off the dole and the really rich, not the ones trying to get rich, the really obscenely rich, get richer.

    I completely agree. It’s disgraceful how the left behave – particularly when they are the ones talking up “social justice”. And welfare/help is often poorly planned and delivered, removing incentive to improve and develop. So far, I’m with you.

    I want a system that is fair for everyone and that lets me enjoy the fruits of my labor without punishing me because I was blessed with bettter brains, a good work ethic, or even luck. We can not all cross the finish line at the same time, and any attempt to force that will fail.

    Agreed. But your advance and work ethic was also due not just to your own efforts, but also to your social environment – your community, your ethnicity and your educational environment. Too often the “see, I did it all myself” means “you failed because you didn’t try hard enough” too a kid struggling to grow up on a poor diet and crack cocaine dealers shooting each other up on the front porch. You had advantages that helped you get where you are. This isn’t to say that people don’t escape from this background, but the process is much much harder.

    So your answer to this dilemma isn’t to reform the government and set up a system of laws that protects individual, property, and human rights, but to resort to wealth redistribution? What gives you the impression this will solve any problems? Historically wealth redistribution has served no good to address inequalities, and practically always made things worse.

    Just handing out cash piles doesn’t work. I agree. But the union movement on which the middle class is based in most Western countries was a redistribution that worked (although you might argue that it is less significant now).

    Part of the work I do here [in unnamed country] is in evaluating development projects, and a lot of the people I work with are very aware of the destructive nature of dependency. Unfortunately, not everyone is, and damage is done – usually by government agencies with too much money lead by unqualified morons. However, this doesn’t make all of the projects bad. Really good ones promote community decision-making, skill transference, local capacity for resource management and disaster preparedness. Now this is a kind of redistribution – taking from wealthy communities in the West and spending the money on poor communities who have nothing. But it’s useful and really improves lives – particularly for children. So the argument shouldn’t be that all redistribution is bad, but that bad redistribution is bad. In this way, taxation can actually promote social goods – anywhere, not just here.

    The problem with wealth redistribution, which is fundamentally the same underlying one that caused our housing bubble break, is that it seeks to fight human nature.

    I would argue that there are two human natures – that of collaboration and that of competition (perhaps there are more, but this will do for now). Both are essential in community development. Good programs will promote both together.

    The first thing you need is a system of law that guarantees individual and property rights. Upon that system you build one that protects the workers from abuse by granting those that do good work the ability to get decent pay. You reward hard work, saving, and common sense, provide education opportunities, and finally limit regulation to what is needed to make sure those that want to create wealth can do so.

    We would probably disagree on what was appropriate regulation, but apart from that, I agreed with you on those points. However, you didn’t really answer my question. Those with massive wealth will constantly use their position to manipulate and control the financial system – at some point, some kind or redistribution may be the only way to avoid a social catastrophe. Cuba before and after the revolution is a great example of what happens when the great mass of the people own nothing and are kept on starvation wages.

    I do not believe in or advocate for social Darwinism. Why is it that you assume I do so? Because I point out that I have a sever phobia of giving government the power to choose winners and losers?

    No. It was because I think you will not help the people who fall through the cracks – are they completely to blame for their circumstances (e.g. crack babies?)

    The problem is that such as system doesn’t give the political class the ability to drastically enrich itself while garnering incredible power, even over life and death (healthcare), and thus sold as a failure by the people that prey on the greed and envy of the masses.

    They’ll find a way – they always do.

    This was the best thing you have ever written on this blog, btw. By a long margin.

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  27. Those with massive wealth will constantly use their position to manipulate and control the financial system

    This is one thing I don’t understand. There seems to be some inherent belief that if those with massive wealth get weathier (and therefore more powerful) they’ll only use that wealth and power to benefit society. However when those on the left get power and wealth, they’ll apparently do the opposite. Human nature apparently differs depending on the ideological beliefs of the human.
    So, really, those that believe in this don’t actually believe in ‘human nature’ at all (i.e. some sort of shared set of general and predictable traits).

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  28. So where does this leave your plan to collapse the global system and repudiate all international treaties because it doesn’t fit with your rejection of the whole concept of ‘global governance’?

    I don’t believe in global governance. Especially not by entities like the UN or the ICC. They are part of the problem.

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  29. There is no ideological system that produces wealth for all.

    No, but there is an economical one, and that’s the one the left despises the most because it takes away their ability to make themselves powerful and rich picking who wins and who loses, all with other people’s money.

    Besides, you start from the idiotic assumtion everyone deserves to have wealth. Me, I think the people that work for it, deserve it. Those that do stupid things when they have it, don’t deserve it either. And those that do not work better have rich relatives or disabilities that qualify them for empathy, and thus help.

    Like I said, the belief that everyone needs to cross the finish line at the same time, and with the same things, is not just stupid, it is evil. Such a system basically rewards people that wouldn’t make it at the expense of others, by off all things taking from others without giving them a say in it or the recipient actually being deserving, while punishing those that would through hard work do it on their own, all so some crooks can make themselves powerful and rich based on people’s envy and jelousy. Fuck that.

    The fact is that life is neither fair nor just, and that we should be scared to death, far more than we should be about life not being fair and just, of anyone that tells you they will make it so.

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  30. Agreed. But your advance and work ethic was also due not just to your own efforts, but also to your social environment – your community, your ethnicity and your educational environment. Too often the “see, I did it all myself” means “you failed because you didn’t try hard enough” too a kid struggling to grow up on a poor diet and crack cocaine dealers shooting each other up on the front porch. You had advantages that helped you get where you are.

    I used to believe this nonsense too until I met a couple of young fellas that would knock the teeth out of your mouth for implying that they only made it out of that exact environment you describe, because of good luck, and not the fact that despite the temptations and the horrible environment, they chose to do what was right and forgo instant gratification. They made it a point to make sure you knew that by making the claim that we couldn’t or shouldn’t hold the fact others made the wrong choices against those that couldn’t get out, you minimized what they did, and they were right. There are hundreds like them that do the right things to get out. How do you think they feel when they see others rewarded, constantly, for doing the wrong things, under the despicable notion that they are too stupid or amoral to do the right thing on their own?

    This isn’t to say that people don’t escape from this background, but the process is much much harder.

    And how many people do you think will feel less encouraged to try to get out when they figure it is easier to just stay, make the wrong choices, and then have others pay for them out of some misguided sense that they are doing something good? Like I said, my friends would be offended that you so deminished their efforts.

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  31. No, but there is an economical one, and that’s the one the left despises the most because it takes away their ability to make themselves powerful and rich picking who wins and who loses, all with other people’s money.

    No, there really isn’t.
    Concentrating wealth and power in one small sector of society (which is what pure captialism and pure communism does) results in the opposite of “producing wealth for all”.
    The best we can do it produce wealth for the most, and the way we do this is to find some sort of balance between providing incentive and providing opportunity. And when it tips too far one way, we take action to tip it back the other.

    I have no desire to make myself powerful or rich. Perhaps you need to start considering the possibility that your premise is flawed.

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  32. We would probably disagree on what was appropriate regulation, but apart from that, I agreed with you on those points. However, you didn’t really answer my question. Those with massive wealth will constantly use their position to manipulate and control the financial system – at some point, some kind or redistribution may be the only way to avoid a social catastrophe. Cuba before and after the revolution is a great example of what happens when the great mass of the people own nothing and are kept on starvation wages.

    A system that respects individual and property rights would never tolerate the situation you describe. And the rich can ONLY manipulate the system when it becomes so big and pervasive that it has its players, the politicians have their hands in all pots, and can manipulate the system to favor the rich. Kind of like what we have become today.

    And as for those Cubans, I wonder how many of them would tell you they were duped and that the current system that keeps them on wages that aren’t much better than what they had before and a third world country, was not really worth it. That is if they didn’t have to fear prison time for telling you the truth.

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  33. No, there really isn’t.
    Concentrating wealth and power in one small sector of society (which is what pure captialism and pure communism does) results in the opposite of “producing wealth for all”.

    Where did you see me advocate for “pure capitalism”, which by definition is what you believe to be Darwinian economics? Did you miss the part about the system protecting individual and property rights? You can’t have that in a Darwinian system. The fact is that capitalism sucks, but compared to everything else, it is by far the best of all systems. Especially those that tell you that you HAVE to give up your wealth in the name of a social contract you have no say in.

    And yes, when the system expects to be able to coerce whatever money it wants at any time from you, without you being able to have a say in it, under threat and through derision, it isn’t much of a good or legal contract. It is theft. And that’s what we have today: theft masqueradin as do good intention by the biggest crooks ever.

    I have no desire to make myself powerful or rich. Perhaps you need to start considering the possibility that your premise is flawed.

    That may very well be true, but the politicians that represent you and your beliefs sure as hell do. And that you pretend otherwise or not to understand that’s what I mean, is galling and more of your usual.

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  34. Besides, you start from the idiotic assumtion everyone deserves to have wealth.

    Not even remotely true. Why you continue to make shit up is beyond me. I was responding to YOUR claim that there was a system which results in wealth for all.

    Me, I think the people that work for it, deserve it.

    And I, like a significant number of others, don’t believe it’s that simplistic. But we do believe that having a system that rewards working hard is the way to go, because it’s the closest we can get.

    Those that do stupid things when they have it, don’t deserve it either.

    And again, that’s incredibly simplistic. One ‘stupid thing’ isn’t the same as another. People make bad decisions all the time, especially in their youth.

    And those that do not work better have rich relatives or disabilities that qualify them for empathy, and thus help.

    People with rich relatives qualify for empathy? You’ve lost me there.
    But again, you’re drawing arbitrary lines across something that is infinitely more complex.

    Like I said, the belief that everyone needs to cross the finish line at the same time, and with the same things, is not just stupid, it is evil.

    No less stupid than continuing to confuse “the belief that everyone needs to cross the finish line at the same time” with “providing as much reasonable opportunity to as many people as is reasonably possible, so hard work has a greater chance of being rewarded”.
    Which is what you continually do, because you have to for your argument to make any sense. You have a whole army of these straw men you keep destroying for no purpose.
    Why don’t you deal with the actual argument, rather than pretending to?

    Such a system basically rewards people that wouldn’t make it at the expense of others, by off all things taking from others without giving them a say in it or the recipient actually being deserving, while punishing those that would through hard work do it on their own, all so some crooks can make themselves powerful and rich based on people’s envy and jelousy. Fuck that.

    Well, again, I don’t buy any of this narrative.

    The fact is that life is neither fair nor just, and that we should be scared to death, far more than we should be about life not being fair and just, of anyone that tells you they will make it so.

    Life can’t be made “fair” or “just”.
    Again, that’s not the point. The point is to provide a system which facilitiates the greatest number of people being rewarded for what they accomplish.

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  35. Not even remotely true. Why you continue to make shit up is beyond me. I was responding to YOUR claim that there was a system which results in wealth for all.

    Maybe I should have said all that work for it (or inherit it, I guess). You got me there.

    And I, like a significant number of others, don’t believe it’s that simplistic.

    I would love to understand why you think this is such a difficult concept. Do you really feel that those that work hard shouldn’t be rewarded the most, because that is just too simple a formula?

    But we do believe that having a system that rewards working hard is the way to go, because it’s the closest we can get.

    Hmmm.. Sounds like you have several problems with the way the left does things if it really believes this. Or maybe you just forgot to say that you believe they should be rewarded up to a point, and after that, the government should confiscate everything they make, because they already have enough?

    And again, that’s incredibly simplistic. One ‘stupid thing’ isn’t the same as another. People make bad decisions all the time, especially in their youth.

    It is rarely “one stupid thing” that causes the problem, but the fact that these people chain the stupid things they do. These people practically always choose the wrong thing, because they are driven by immediate gratification.

    People with rich relatives qualify for empathy? You’ve lost me there.

    No people with rich relatives have the relatives pay for them, and otherwise, their plight is a real one that results in empathy and hence, help.

    But again, you’re drawing arbitrary lines across something that is infinitely more complex.

    In my experience the complexity is always introduced as a means to allow the people that want to get powerful and rich from the system to do so. Either because they put loopholes in for their buddies that pay for them, or because they make it impossible to do anything without buying their favor.

    No less stupid than continuing to confuse “the belief that everyone needs to cross the finish line at the same time” with “providing as much reasonable opportunity to as many people as is reasonably possible, so hard work has a greater chance of being rewarded”.

    I would really love for you to explain to me how generational welfare dependence, paying for people to do more bad behavior we should discourage but feel causes harm and thus end ups subsidizing, and convincing them they are actually entitled to free shit, qualifies as giving them a greater chance. To me it looks like what drug dealers do to junkies: hook them and abuse them for all it is worth.

    Well, again, I don’t buy any of this narrative.

    Of course you don’t CM, and no amount of proof will convince you of the contrary, because you are fanatically devoted to the collectivist bullshit. It can fail and put us back into a dark age, and people like you would still be defending it. I met a few of those when I took a trip back behind the iron curtain after it fell. Man did they pine for the good old days. Heh.

    Life can’t be made “fair” or “just”.
    Again, that’s not the point. The point is to provide a system which facilitiates the greatest number of people being rewarded for what they accomplish.

    Bullshit! The system your faith is comprised off certainly is doing nothing of the sort. In fact, about the only thing it is guaranteeing us is that the next few generations will all be far worse off than the one currently ripping their children and grandchildren off, under the pretense of helping as many people as possible. What a fucking scam.

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  36. Where did you see me advocate for “pure capitalism”, which by definition is what you believe to be Darwinian economics? Did you miss the part about the system protecting individual and property rights? You can’t have that in a Darwinian system.

    I’m not talking law-of-the-jungle anarchy. Pure capitalism would rely on protecting individual and property rights.

    And yes, when the system expects to be able to coerce whatever money it wants at any time from you, without you being able to have a say in it, under threat and through derision, it isn’t much of a good or legal contract. It is theft. And that’s what we have today: theft masqueradin as do good intention by the biggest crooks ever.

    “Tax is theft” is as old as tax itself. “Today” makes no difference to the philosophy of whether it is or not. And taxes used to be much higher than they are today. But you instead concentrate on the raw value of the total tax take, even though it’s simply the result of there being more people and more wealth going through the system.

    That may very well be true, but the politicians that represent you and your beliefs sure as hell do. And that you pretend otherwise or not to understand that’s what I mean, is galling and more of your usual.

    I’ve never seen you make this distinction before. It’s refreshing to see that you DO have the ability to acknowledge that some people on the left aren’t inherently wanting to pursue your narrative. It’s a shame you don’t do this more often.

    I don’t have a lot of trust in politicans of any persuasion. I reject the idea that my beliefs should be judged on the basis that some politicians want wealth and power for themselves and people like them. If they do that, and act accordingly, they inherently don’t represent me. I recognise that if I advocate for a mixed economy, with the government being part of it, it requires accountability, transparency and ongoing vigilance. A system without those is destined to failure. It appears that Greece couldn’t even collect most of the tax is was owed. If you can’t even do that basic function, you’re fucked from the start.

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  37. I’ve never seen you make this distinction before. It’s refreshing to see that you DO have the ability to acknowledge that some people on the left aren’t inherently wanting to pursue your narrative.

    Those tend to also be the people that believe in Santa Clause and the Easter Bunny, I bet though. After age 30, people should really give up on those childhood fantasies.

    It’s a shame you don’t do this more often.

    I have done it quite often. If you still have trouble with me pointing out that the politicians that push what the left believes in are the nastiest parasites to inhabit this planet so frequently, I think the issue is with you, CM, not me.

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  38. I would love to understand why you think this is such a difficult concept. Do you really feel that those that work hard shouldn’t be rewarded the most, because that is just too simple a formula?

    Dealt with in my subsequent comment. It’s far from perfect, and should still be the general basis for the system. You keep pretending that isn’t the case.

    Hmmm.. Sounds like you have several problems with the way the left does things if it really believes this.

    Don’t really understand what you mean by that.
    I constantly see comments from left being interpreted to mean “we all must cross the finish line together” but I didn’t see it that way at all.

    Or maybe you just forgot to say that you believe they should be rewarded up to a point, and after that, the government should confiscate everything they make, because they already have enough?

    No, I would never agree with a 100% tax rate beyond any level. Not in a million years. That would be absolutely pointless. This is yet another example of a straw man – you keep suggesting these things that nobody would ever advocate. E.g. “even if we taxed all rich people 100% for the next 5 years it still wouldn’t pay off the deficit”. It’s a lazy, nonsensical argument.

    It is rarely “one stupid thing” that causes the problem, but the fact that these people chain the stupid things they do. These people practically always choose the wrong thing, because they are driven by immediate gratification.

    And our system preys on it by spending billions every year working out how to entice people into making bad decisions. Including elevating materialism as being the ultimate example of success. And then we laugh and point our fingers and say “HA!” at the people who got sucked in and made the bad decisions. It’s pretty sad.

    In my experience the complexity is always introduced as a means to allow the people that want to get powerful and rich from the system to do so. Either because they put loopholes in for their buddies that pay for them, or because they make it impossible to do anything without buying their favor.

    So are you saying it’s not complex? You’re saying the myriad of situations that people find themselves in are all the same? Because that’s how it reads. It suggests you don’t want to see it as complex, on the basis that it doesn’t lead somewhere you want to go, because of your “sever phobia”.
    Personally, I can’t see it as anything else but complex. We acknowledge it’s complex, and then decide whether we’ll attempt to factor complexity into the system we set up. I don’t see any benefit of trying to pretend it’s not complex, in order to justify not dealing with complexity in the system we set up.

    I would really love for you to explain to me how generational welfare dependence, paying for people to do more bad behavior we should discourage but feel causes harm and thus end ups subsidizing, and convincing them they are actually entitled to free shit, qualifies as giving them a greater chance

    When I’m convinced that this sort of thing makes up a significant enough chunk of the population, I’ll no doubt revise my thoughts on the issue. I’m not even close to convinced that “generational welfare dependence” is significant enough to allow it to fundamentally affect an entire system. That’s not to say it doesn’t exist.
    If you believe “generational welfare dependence” to be a big problem, then aren’t you suggesting these people are incapable of breaking out of their situations? Weren’t you just suggesting that this is offensive? Which is it?

    To me it looks like what drug dealers do to junkies: hook them and abuse them for all it is worth.

    I don’t buy it. I believe the overwhelming majority of people have sufficient pride that wouldn’t allow them to live like that. The low unemployment figures during boom times is testament to that.
    Remember, most people on the left don’t advocate a system which makes it more attractive to stay and home than work. But there is always going to be a tiny number of people that would rather live in shitty conditions than work. Always. We just shouldn’t allow them to dictate our whole system, and have them ruin potential opportunities for millions and millions more. That seems like cutting off your nose to spite your face.

    Of course you don’t CM, and no amount of proof will convince you of the contrary, because you are fanatically devoted to the collectivist bullshit.

    Ah here we go. Normal transmission resumes. Making shit up again. I can’t possibly disagree with you, and if I do, it’s simply because I’m “fanatically devoted to the collectivist bullshit”.
    Honestly Alex, you’d be so much more credible if you didn’t keep falling back into that silliness.

    It can fail and put us back into a dark age, and people like you would still be defending it. I met a few of those when I took a trip back behind the iron curtain after it fell. Man did they pine for the good old days. Heh.

    As above. It’s a shame you always feel the need to do this.

    Bullshit! The system your faith is comprised off certainly is doing nothing of the sort. In fact, about the only thing it is guaranteeing us is that the next few generations will all be far worse off than the one currently ripping their children and grandchildren off.

    Ok Alex.
    Thanks anyway. We got further than we usually do.

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  39. What about the fact that we still have a housing bubble, a student load bubble, and a credit card bubble at this time under Obama?

    Credit card is down by a couple of trillion dollars. The real estate market is down to 2007 levels. Try facts, Alex.

    Also, there is simply no comparison between the .com bubble and the housing bubble. Many business survived the .com bubble. It was a standard industry bubble where many companies fell and the strong survived. You can see the same thing in history with industries like rail and cars. The real estate bubble was fundamentally different. It created no lasting wealth, it saw income inequality rise and wages decline. It saw welfare rolls steady. It saw the deficit growing. And then it detonated and left nothing, no lasting industry in its wake.

    And, of course,the Party of Personal Responsibility (TM) continues to blame everyone but themselves. Yeah, Barney Frank and Chris Dodd. I’ve slammed them too. I described them as being so close to the banking industry their shit comes out in coin sleeves. But it is a fact that the Republicans had both houses of Congress and the White house and didn’t do shit about housing. Oh, they made gestures toward Fannie and Freddie. But you’re seriously going to tell me that they couldn’t get past those two idiots? I would submit that if your party controls all the wheels of power and you’re being stopped by Barney Fucking Frank and Chris Fucking Dodd, you should just give up politics.

    More to the point, the GOP pushed for the exemption in selling houses for the first $250-500,000 in profit. They pushed for lower capital gains. Bush personally pressured the Fed to keep interest rates low. You simply can’t pretend that didn’t exist.

    Got it. You believe the money was the government’s in the first place and that it is a crazy idea to let people keep more of what they earn if it jeopardizes government’s ability to spend big money.

    Are you seriously going to tell me that I have not been pointing out that things can not keep going on as they are right now? My point is that the issue is and ALWAYS will be the spending., and we are SPENING too damned much. And you can bet your ass the spending is happening for political purposes: it buys them votes.

    Keep whacking that straw man. There are tax cuts and there are tax cuts. There are tax cuts that stimulate the economy and there are tax cuts that don’t. We have talked about this endlessly, the difference between cutting taxes for hiring workers and cutting taxes for people who don’t pay taxes.

    For heaven’s sake, read what Bruce Bartlett wrote ten years ago about the taxes. This was the man who basically created supply side economics. He predicted that the Bush tax cuts would not help the economy but blow huge holes in the deficit. And he was right.

    Tax cuts can increase revenues when the tax rates are VERY high, like they were when Kennedy cut them (91%) and when Reagan cut them (70%). But the idea that cutting tax rates increases revenues when those rates are in the 30′s runs against everything Laffer, Kemp, Bartlett and Reagan ever said.

    You’re just illustrating the problem once again. Tax cuts are no longer an economic idea; they are a religion. The belief that all taxes are bad and all tax cuts are good and that we can somehow cut taxes and balance the budget is not based on any kind of reality.

    Look at the CRS study that CM cited. I’m a little dubious, but they have shown that there doesn’t appear to be a big correlation between economic health and tax rates. Now there are criticism of this, sure. But the GOP and the conservative Ecosphere did not respond by pointing out its errors. They responded by shooting the messenger and demanded the CRS withdraw the study.

    You say the Keynesians are crazy? Alex, you’re just like them. Immune to fact, clinging to your religion of misunderstanding the entire basis of supply-side economics. And branding anyone who disagrees as a big-government liberal, a Marxist and a Keynesian.

    Once again, i ask: Reagan, Bush I and Clinton raised taxes six times between 1982 and 1994. The marginal rate went from 28 to 39.6%. How on Earth did we have a healthy economy?

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  40. For heaven’s sake, read what Bruce Bartlett wrote ten years ago about the taxes. This was the man who basically created supply side economics. He predicted that the Bush tax cuts would not help the economy but blow huge holes in the deficit. And he was right.

    Worth a read.

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  41. Credit card is down by a couple of trillion dollars. The real estate market is down to 2007 levels. Try facts, Alex.

    So first you try to blame Boosh because there was a housing bubble hidning in there during the economic growth, but when I point Obama has 3 of them hiding in his bad economy, you tell me to get facts? What’s that called? A 180? A flip-flop? A double standard?

    Also, there is simply no comparison between the .com bubble and the housing bubble.

    Next you will tell me it is because one was more “complex” than the other. As if bad investments aren’t bad investments no matter what.

    Many business survived the .com bubble

    .

    So most businesses didn’t survive the housing bubble? BTW, I work in IT, practically every IT start up, with a very few exceptions, went belly up when the bubble burst. One of them bellonged to a buddy that offered me $350K a year to move to San Diego to work with him in early 2001. I turned him down when I realized that due to the cost of living there I would be taking a pay cut. He lost his business and a lot of money, just like practically every other start up. bUT HEY, You are welcome to tell me I don’t know the industry I have worked in for over 2 decades now.

    It was a standard industry bubble where many companies fell and the strong survived. You can see the same thing in history with industries like rail and cars. The real estate bubble was fundamentally different. It created no lasting wealth, it saw income inequality rise and wages decline. It saw welfare rolls steady. It saw the deficit growing. And then it detonated and left nothing, no lasting industry in its wake.

    The difference between the .com bust and the housing bust is that in one case the companies that had overleveraged and produced nothing went belly up, while in the other the tax payers where forced to bail out the banks the libs had promised to pay off when their social engineering experiment went south. Too big too fail. Unfortunately we are now stuck with more of that becaue of the social engineers. The education bubble is the next one to go.

    And, of course,the Party of Personal Responsibility (TM) continues to blame everyone but themselves.

    That’s almost funny coming from someone with Obama’s dick shoved so deep down their throat.

    Yeah, Barney Frank and Chris Dodd. I’ve slammed them too. I described them as being so close to the banking industry their shit comes out in coin sleeves. But it is a fact that the Republicans had both houses of Congress and the White house and didn’t do shit about housing. Oh, they made gestures toward Fannie and Freddie. But you’re seriously going to tell me that they couldn’t get past those two idiots?

    I recall McCain and Boosh both trying, only to be called racists!!1eleventy!! and shut down. Back then the race card had not been so overused people basically ignored it like they do nowadays. It was a death sentence. But you can pretend the republicans would ever have been allowed to do anything to this leftist social engineering experiment. For that matter, did you miss how they got and are getting treated when they brought/bring up that SS and Medicare needed fixing? But you can pretend the problem is them doing nothing, and not that actually trying to do the right thing is suicidal because the social engineers will do their best to destroy you for fucking with their livelyhood.

    Oh, they made gestures toward Fannie and Freddie. But you’re seriously going to tell me that they couldn’t get past those two idiots?

    Shit, they couldn’t get past them AFTER they caused the housing collapse! The LSM and Team blue play for keeps, and republicans don’t. But to blamerepublicans because they can not keep up with people that have rigged the game makes me wonder if you are short a few knifes in that drawer.

    I would submit that if your party controls all the wheels of power and you’re being stopped by Barney Fucking Frank and Chris Fucking Dodd, you should just give up politics.

    I would like to see many of these people that keep bending over for the left or the LSM go the way of the Dodo bird, but the problem is that I keep getting told people that have actual balls are not allowed in DC, and we end up stuck with metrosexual stooges that are worried about how the LSM will portray them.

    More to the point, the GOP pushed for the exemption in selling houses for the first $250-500,000 in profit. They pushed for lower capital gains. Bush personally pressured the Fed to keep interest rates low. You simply can’t pretend that didn’t exist.

    When did I reject any of that? What I did point out is that it wouldn’t amount to a fraction of the revenue you wanted to attribute to it, because, as I already said, you only got the exemptions once, and then on your first purchase or first sale. That group was “definitely” only a small part of the clique of house sellers you wanted to pretend made all kinds of crazy money because of tax cuts they don’t even qualify for. But you can keep digging the hole sir.

    Keep whacking that straw man. There are tax cuts and there are tax cuts. There are tax cuts that stimulate the economy and there are tax cuts that don’t. We have talked about this endlessly, the difference between cutting taxes for hiring workers and cutting taxes for people who don’t pay taxes.

    The one thing that is indisputable is that there are no tax hikes, made during a bad economy, that will help said economy do anything but get worse.

    For heaven’s sake, read what Bruce Bartlett wrote ten years ago about the taxes. This was the man who basically created supply side economics. He predicted that the Bush tax cuts would not help the economy but blow huge holes in the deficit. And he was right.

    Bartlett is a moron. AI am being kind. What caused the Boosh deficits is the same thing that causes deficits every time: the spending. Blaming tax cuts is not just a sign of you not understanding economics, but plain and simple partisan politics. Well in your case with a hefty dose of BDS and self interest as well. Especially since the graph right on this post CLEARLY shows that the revenue went up every year as the economy grew through investments, until the housing bubble burst. Then again, those Boosh deficits look like peanuts compared to the ones we have run the last 4 years, and all I hear you doing is repeat stupid leftist talking points about tax cuts causing deficits, while ignoring the jump in government spending on entitlements: the budget sector to see the biggest hike in the last 4 years.

    Look at the CRS study that CM cited. I’m a little dubious, but they have shown that there doesn’t appear to be a big correlation between economic health and tax rates. Now there are criticism of this, sure. But the GOP and the conservative Ecosphere did not respond by pointing out its errors. They responded by shooting the messenger and demanded the CRS withdraw the study.

    I looked at the study. Besides the fact that it was done by a partisan political hack, the only problem I had was that his conclusions look like they are cherry picked. Probably because his facts feel like they are too. It is not very hard to comprehend the concept that when people think they can make and keep more wealth that they do just that. And it results in a growing economy, which then in turn results in more wealth and more revenue from taxing that wealth, even at a lower rate. Just like it is not too hard to see the contrary. I had a post here the other day how the hike they did in GB resulted in most millionaires bailing and the take, despite a massive hike, dropping. Most people tried to ignore that.

    You say the Keynesians are crazy? Alex, you’re just like them. Immune to fact, clinging to your religion of misunderstanding the entire basis of supply-side economics. And branding anyone who disagrees as a big-government liberal, a Marxist and a Keynesian.

    I am so sorry I don’t get it as well as you do Professor of Economics, Hal. That’s sarcasm, in case it fails to register. And my objection to the tax hikes Team Blue wants have nothing to do with supply side economics. It has to do with the fact that eeryone, including idiots know that giving an alcoholic more booze will only cause problems, giving more money to fucking idiot tax and spenders will just result in more spending. They will not do what they are supposed to with it, and instead will just spend more. So far what Obama wants vindicates my stance.

    I have said before that I would accept tax hikes, to lower our debt, as long as we had cuts that would bring our spending in line with whatever revenue we collect. But what I clearly see is that we will not only get no cuts, we will only get more spending with the tax hikes, and I refuse to go along with that. I would love for us to go back to the tax rates of the Clinton years, but with our spending also equal to that of the Clinton years.

    Once again, i ask: Reagan, Bush I and Clinton raised taxes six times between 1982 and 1994. The marginal rate went from 28 to 39.6%. How on Earth did we have a healthy economy?

    What was different when they raised taxes Hal? Here is a clue: their economy was on fire. Our current economy is on life support. And as if that wasn’t bad enough, they intend to use the tax hikes to spend more, while leaving all the spending we can not afford untouched. But hey, you are still stuck on arguing Boosh tax cuts with me because of your BDS instead of noticing that the American tax payer is about to be fucked without the courtesy of a reach around.

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  42. Tax cuts are no longer an economic idea; they are a religion. The belief that all taxes are bad and all tax cuts are good and that we can somehow cut taxes and balance the budget is not based on any kind of reality.

    I agree with what you are saying here, but the opposite side needs to be looked at as well. Is the tax increase going to be effective? The last few economic posts by Alex have had a lot of discussion about taxation and how it may effect behavior. Isn’t it natural for folks to slow their economic investments when the reward is minimized or penalized? There isn’t much dis-agreement that those type behaviors will happen, only the total effect has been argued.

    Regulation has been mentioned as well. Healthcare, EPA and OSHA are all going to have a greater amount of rules to live by and in many cases more money to pay. Companies are cutting hours to keep full-time employees at a minimum. Small business will keep their numbers below certain thresholds. Energy costs are going up. Industrial compliance costs are going up.

    What factor out there gives anyone any confidence that the private sector will produce more? What Obama policy actually encourages business? Subsidies are not encouragement IMO. Not the right one for the country at least.

    I just think our govt spends too much. I know the idea of govt spending during the hard times, but our govt does not save during the good times. That fact alone means we have to make our govt live within a budget. But we haven’t had one of those in the Obama era, so it’s obvious that our current congresscritters & pres aren’t seated in reality. No proposal so far will get us anywhere near deficit reduction (please don’t try and argue that a 10% reduction in the deficit is any kind of accomplishment).

    I’ve seen Stogy & Hal bash the “tax breaks for increased revenue” idea and I think we are at a point where those possible revenue increases are small and isolated. On the flip side, I have yet to hear a good case for tax increases actually doing anyone any good. Behavioral changes may reduce anticipated increases in revenue (discussed quite a bit here). Nothing positive to business in increased taxes at this point (every current business has to accept this as a cost). The proposed tax increases and their supposed revenues don’t make a dent in our deficit, so why do it? Why hurt business?

    Spending is the issue and if it’s not reduced, we go bankrupt. I’ve read Bernanke and Krugmann and even a few of the links CM loves. Does anyone really believe we are not spending too much?

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  43. Bartlett is a moron.

    How so? Is it simply because he’s a now considered a “traitor”, having joined the “reality-based community”?
    What you say supports everything he talks about in the piece I linked. You realise that don’t you?

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  44. Isn’t it natural for folks to slow their economic investments when the reward is minimized or penalized?

    Depends on how it’s “minimized or penalized”.

    There isn’t much dis-agreement that those type behaviors will happen, only the total effect has been argued

    There is disagreement.
    For example if personal tax rates go up, then more business investment is possible, as owners seek to use what will otherwise be taxable income.

    Does anyone really believe we are not spending too much?

    Looks to me like the US is spending too much. But when the economy is weak, it’s counter-productive to start austerity. Alex himself has linked to how businesses are concerned about how austerity measures will adversely effect demand for their goods and services. At least with tax, people can take measure to avoid it. Like investing in their businesses.

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  45. Isn’t it natural for folks to slow their economic investments when the reward is minimized or penalized?

    Grady, not necessarily. If taxes on profits are higher, many people are more likely to ply pre-tax earnings back into their businesses – leading to increased investment and growth. Reducing payroll taxes and capital gains taxes on particular types of economic activities and offering tax breaks for new tech installations can help promote this, even in an overall higher taxed economy.

    Alex will probably oppose this as it is the government picking winners and losers and he has reverted to his Obama Derangement Syndrome holding pattern since I clocked out about 5 hours ago. Pity, just for a while he was doing really well.

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  46. Alex, I’m not sure if you would stoop so low as to use today’s “Day by Day” strip in your dealings with Worm-Tongue stogy (yeah thanks for that Thrill) or her menstruating little sister CM. Anyway here it is as their debate tactic sooo seem to fit.

    Day by Day – Karma

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  47. Grady, not necessarily. If taxes on profits are higher, many people are more likely to ply pre-tax earnings back into their businesses – leading to increased investment and growth.

    What nonsense. Bigcorporations, the multinationals will send their profits and their jobs off shore. Small business might invest, but they will not invest in any way that will grow the economy. They certainly will not hire anybody.With the uncertainties tied to other things such as Obamacare or the fact that when the tax & spenders find their hike doesn’t produce the bump they wanted and the new spending is causing even bigger deficits, the will probably find ways to hide income more than inviset anyway. But you social engineers can pretend that screwing people in business out of their profits is gonna make them improve the economy in anyway.

    Alex will probably oppose this as it is the government picking winners and losers and he has reverted to his Obama Derangement Syndrome holding pattern since I clocked out about 5 hours ago. Pity, just for a while he was doing really well.

    Pointing out that attempts by government to coerce behavior practically always backfires, now is ODS? Shit, you libs are just insane. For a while I tried to discuss things logically. Then I realized Hal, you, nor CM had any interest in that. What you three, for whatever reason, wanted was to again pretend that tax cuts, and not spending, is our problem. Don’t hold it against me when I later do the “I told you so” dance of vitory, just like I have been doing for the last 4 years.

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  48. What? Argue with them better.

    That’s the whole point “your frikken pal” and my frikken pal don’t argue they obfuscate, talk over and consistently tell us how we “need” to see, look at and act on everything they disagree about. This post is a perfect example. Fifty or more comments by mostly Tampon® and Tampax® telling Alex how he should be changing his views. Oh yeah, with a drive-by hit from our academic
    lefty just so he can seem to remain relevant.

    BTW Did you bother to look at the comic strip I linked to? Or do you understand why the lion-share of commentators only show up on Friday lately?

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  49. Bigcorporations, the multinationals will send their profits and their jobs off shore.

    If they can find a country where people will do the same job for $2.00 an hour, then a marginal increase in tax is not really going to make a difference.

    But you social engineers can pretend that screwing people in business out of their profits is gonna make them improve the economy in anyway.

    It’s all social engineering, Alex. We covered that ground before. You just don’t recognize that you are also advocating for a different kind of social engineering

    Pointing out that attempts by government to coerce behavior practically always backfires, now is ODS?

    Actually, it works quite a lot. How are smoking rates in the US doing at the moment? Literacy? People still driving on the right and stopping at traffic lights? Insider trading still illegal? Restaurants serving food that won’t send people to hospital? Doctors complying with rules on handwashing before surgery? Building heights commensurate with local zoning laws? Companies still held accountable for dumping toxic sludge in rivers? Hunting out of season still banned? Want me to go on…?

    But yes, the return of ODS on the thread.

    For a while I tried to discuss things logically.

    Yeah, you did. And we ended up agreeing on quite a lot once you disappeared the reactionary, economic fundy drivel, namecalling, and repositioning of opponents’ arguments that you usually produce. There were some nice arguments and solid reasoning.

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  50. Oh yeah, with a drive-by hit from our academic lefty just so he can seem to remain relevant.

    That would be me, right? Heh! That’s an improvement. Last time we talked, you called me a “low-rent troll”.

    Actually, I’m an economic centrist and I am inclined to support center-right and center-left candidates. The ‘wobble’ between both is important. I am socially liberal, with libertarian leanings on many (but not all) issues. I love micro-brews and real ales, and the odd glass of wine. What’s not to like?

    How’s Harley, btw? I haven’t seen him since I got back.

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  51. That would be me, right? Heh! That’s an improvement. Last time we talked, you called me a “low-rent troll”.

    Ah no! I was referring to Hal. The resident tax hiking, Obama defending, head in the clouds Ivory Tower liberal trying to pass him self off as “a man for all seasons”.
    But I’m not surprised you thought is was ‘all about you’. And I also can’t remember calling you a “low-rent troll”. Although I can see how that would sting your overinflated ego. Not that I think you’re “high rent” either btw. I thought original Tampon® fit you just fine. Common and mildly irritating.

    As for your self stated creds… good for you.

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  52. Ah. OK Sorry MY. My bad. I thought it was because I threw in a reference to a dead philosopher.

    And actually it was Seattle Outcast who called me a low rent troll. Come to think of it.

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  53. Hal, I see you’re back in your Ezra hat?

    That analysis is pure garbage. First of all, what about the 2001 tax cuts? That was the first wave of tax cuts, not the 2003 tax cuts. So they already full of shit. Second, you can’t ignore that the revenues were bloated by a gigantic housing bubble. Are we going to sit around and pretend that giving huge tax breaks to home sellers had nothing to do with this? Oh yeah, I forget. It was ACORN and Jimmy Carter who created credit default swaps.

    So it’s tax breaks now that created the bubble? Interesting. As for credit default swaps, what had to happen before the seller would have to pay up? A clue is in the middle of the name of the derivative. What created the conditions for such mass defaults that snowballed into the CDS arena any guesses? Were much of the bad loans in private enterprise, yes, but who decided pushing financial institutions to start screwing with standards that had been working fine? Any guesses? And yes banks are going do what they need to do they’re going to try to make a profit off the rules that are put in front of them. And yes, they hold responsibility for their deeds to be sure, but you put a gas and a flame in front of a pyro don’t be surprised at what happens.

    Oh, they made gestures toward Fannie and Freddie. But you’re seriously going to tell me that they couldn’t get past those two idiots? I would submit that if your party controls all the wheels of power and you’re being stopped by Barney Fucking Frank and Chris Fucking Dodd, you should just give up politics.

    Correct, they acknowledged there was a problem as far back as 2003; perhaps they didn’t see how bad the scope was going to be, and while a potential problem (at the time) did not act on it enough. Of course everyone is clairvoyant when they look back at yesterday and should have know it would be worse, (and for you especially the GOP). There was more than simply Dodd. There was heavy lobbying and other factors to stall the bill(s), fact is the other side did not want to do anything about it period until late in the game when shit was already headed downhill. Yeah that’s right, the side that wants to regulate everything else. And yes, there were some on the GOP who were also a problem and had ties with Fannie. There will always be bad seeds, like your two friends in Maine that were stonewalling Social Security reform. A failed attempt at reform where the GOP is to blame for not reforming, but then they’re to blame for bitterness against those who stonewalled. Good way to cover all bases. Anyhow, to suggest that the GOP should have no complaints about the other side is asinine. Like it or not it was mostly the other side’s doing. Perhaps it’s the democrats who should have put the bipartisan bickering away for a bit on this issue. Oh yeah, and the guy you secretly were hoping to win, but you weren’t, but you do, but you didn’t, but whatever didn’t seem too supportive of dealing with this either and he was in the Senate in 2005 when yet another attempt was made to do something, and didn’t offer anything, nothing, zilch, nada. And he’s the one in office now. I see you’ve bought his line of Bush caused the housing crisis all by himself hook line and sinker.

    More to the point, the GOP pushed for the exemption in selling houses for the first $250-500,000 in profit. They pushed for lower capital gains. Bush personally pressured the Fed to keep interest rates low. You simply can’t pretend that didn’t exist..

    As for the break are you referring to this?

    The one the passed by 80 % in both chambers by Democrats, and a higher amount by Republicans, but high with both parties in 1997 before Bush was president? This as opposed to the old tax code which to keep your gain you had to buy a more expensive home forcing upsizing? Fact is many houses went up in price simply due to inflation prior to the bubble so yeah lots of homes especially on the coasts were all in this higher range. I don’t see an issue with adjusting for inflation.

    Low rates and upping the tax free amount weren’t the main problems and you know it. It was shitty loans made to people who couldn’t afford it, packaged up and shipped off. As for CDS, they were triggered due to the defaults by the cause, not the cause itself. All of which at one point encouragement for these shitty loans were either mandated to some degree or encouraged by the government mostly on the Democratic side. Both sides can fuck up, but id doesn’t always have to be in equal amounts and it wasn’t in this case.

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  54. Looks to me like the US is spending too much.

    We do agree on something.

    But when the economy is weak, it’s counter-productive to start austerity. Alex himself has linked to how businesses are concerned about how austerity measures will adversely effect demand for their goods and services.

    What austerity? No real spending cuts have been proposed by anyone. Tax hikes immendiately and small spending cuts down the road. The US will have austerity when our credit is no longer respected by outside lenders. And then what (we get more money printing to really take us down the bankrupcy hole). Alex’s link didn’t mention a single detail on what austerity measure may be a problem. I think we have a much larger problem with our govt’s negative incentives to doing business than we do with businesses being concerned about a lack of govt largess.

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  55. If taxes on profits are higher, many people are more likely to ply pre-tax earnings back into their businesses – leading to increased investment and growth.

    True, but the behavioral changes of the business may be other things that are not in the interest of the US, but good for the business, as Alex has already pointed out.

    Bigcorporations, the multinationals will send their profits and their jobs off shore. Small business might invest, but they will not invest in any way that will grow the economy. They certainly will not hire anybody.

    Call it unintended consequenses if you like. We need tax policy that actually makes business want to be in the US. I don’t think we can do that with the current levels of spending.

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  56. Credit card is down by a couple of trillion dollars. The real estate market is down to 2007 levels. Try facts, Alex.

    Hundreds of thousands of people filing for bankruptcy and CC companies writing off bad debt for tax purposes easily make up the lion share of the CC debt reduction.

    http://www.nerdwallet.com/blog/credit-card-data/average-credit-card-debt-household/

    Check out the table labled Falling indebtedness is largely due to defaults rather than repayment

    http://www.realtor.com/data-portal/Real-Estate-Statistics.aspx?source=web

    Ummm, 2007 was STILL a huge housing bubble. Houses are still overpriced in most suburban areas. The market is slow overall.

    While lower inventories are a positive sign, the recent erosion in the median list price may foreshadow a dampening of recent increases in housing prices.

    The recovery that began in Florida more than a year ago has since spread to California, Arizona, Nevada and other parts of the West, with many of these markets registering dramatic declines in the number of properties for sale coupled with year-over-year list price increases of 10 percent of more. However, a growing number of Midwestern and “rust belt” markets are registering signs of weakness, with list prices below the levels observed last year.

    Try getting some facts of your own Hal.

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  57. We give up freedoms (including a percentage of income as tax) in order to live in a society which protects us, educates us and provides us with rights.

    The biggest problem I have with this claim is the notion that society “provides rights”. No. If society or government is what “gives us” rights, then society or government can take those rights away…

    The conservative American viewpoint is that of the Founders — it is considered self-evident that rights come from nature and nature’s God, not government. And chief among those rights are life, liberty and the pursuit (not attainment) of happiness, and that we are all equally endowed with those rights. We are not “equally endowed” with the “right” to actually be happy, or free from hardship — that last one is essentially a progressive view.

    No the purpose of government is to secure rights, not “provide” them.

    Also, the notion of taxing income was something to which the Founders were pretty much unanimously opposed, but which progressives apparently favor — it was none other than progressive President Woodrow Wilson who signed income taxation into law. I reckon progressives needed a way to fund all those utopian government programs they had in mind.

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  58. What you three, for whatever reason, wanted was to again pretend that tax cuts, and not spending, is our problem.

    Where did any of us say that spending isn’t a problem?

    CM:

    Looks to me like the US is spending too much.

    There’s not need to completely give up on trying.

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  59. What austerity? No real spending cuts have been proposed by anyone.

    That’s what small business owners are saying apparently.
    From Alex’s link:

    Businesses have shown signs they are holding back on investments because federal austerity plans could trigger a recession next year

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  60. What austerity? No real spending cuts have been proposed by anyone. Tax hikes immendiately and small spending cuts down the road.

    Exactly!

    Anye economy that can’t function without massive government largesse should implode.

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  61. Where did any of us say that spending isn’t a problem?

    Then why do you continue to exclusively focus on and defend the tax hikes collectivists want, when I write posts that point out they are not just a bad idea, but should not be agreed upon until we have concrete, meaningfulll, and timely cuts?

    Shit, anyone right now that continues to drag the conversation towards why tax increases are not bad, instead of screaming that they should never be allowed until we have at least a 4 to 1 ratio of cuts to tax increases, with the cuts kicking in before the taxes, is basically unserious about the cuts. period.

    Queue Team Blue and president Present.

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  62. Then why do you continue to exclusively focus on and defend the tax hikes collectivists want, when I write posts that point out they are not just a bad idea, but should not be agreed upon until we have concrete, meaningfulll, and timely cuts?

    I’m invariably responding to comments. But, again I said “Looks to me like the US is spending too much“. How do you interpret that in any other way than “spending should be cut”?
    I also agree that it should all come as a package. And that additional revenue is absolutely not be seen as the chance to spend more money.
    The problem (an increasing deficit) has two components – spending and taxes. The whole point of Hal’s posting is the rigid ideological inability of some on the right to even consider the raising of any tax. That’s at least as much of a problem as the left failing to agree to cuts.

    End agricultural subsidies (if we can do it and thrive, surely you can too). There we go, I saved you $20 billion a year in spending immediately. And before you start comparing that to the size of the deficit and complaining that it’s not enough, it’s not intended to be.

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  63. First of all, what about the 2001 tax cuts? That was the first wave of tax cuts, not the 2003 tax cuts.

    Not sure if anyone else mentioned this yet, but the 2001 cuts were phased-in cuts, and didn’t go into immediate effect. This could account for the weak economic performance of 2001, not to mention the decidedly dampening effects of the event known as 9/11. Phased-in cuts can have the effect where businesses and individuals hold off on hiring and investing until the cuts actually go into effect.

    In contrast, the 2003 cuts were immediate, and reversed the phased-in approach of the 2001 cuts. That could explain the stronger economic performance of 2003 and beyond.

    That analysis is pure garbage. First of all, what about the 2001 tax cuts? That was the first wave of tax cuts, not the 2003 tax cuts. So they already full of shit.

    Given my explanations above, your emotional outburst seems unwarranted, and your conclusions premature, to put it mildly.

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  64. Dude, you were the one that linked it.

    No CM, you are the one that put a focus on that. I ignored it as stupid, because I am not a fan of either crony capitalism or any form of government funded largesse. I do not want government to do anything other than what the constitution allows it to, and maybe, some basic umbrella type social stuff for those that are truly unfortunate and need it. And anything that is or can become a vote buying scheme needs to be squashed.

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  65. No CM, you are the one that put a focus on that. I ignored it as stupid, because I am not a fan of either crony capitalism or any form of government funded largesse.

    Oh I see, you’re now admitting to having cherry picked what you wanted from your link, but don’t like the fact that I picked up the fact that you replaced the reasoning with your own. Even though the reasoning was the whole point of your piece (so you could keep selling your narrative).
    Sorry, you don’t get to do that. If the STATED rationale provided in your own source doesn’t fit your narrative, at the very least look elswhere. Don’t just replace it with your own. Otherwise you just look lazy and stupid.

    I do not want government to do anything other than what the constitution allows it to, and maybe, some basic umbrella type social stuff for those that are truly unfortunate and need it. And anything that is or can become a vote buying shceme needs to be squashed.

    That’s nice, but you don’t get to just ignore that businesses have “shown signs they are holding back on investments because federal austerity plans could trigger a recession next year” and replace it with your own narrative. Just because others here don’t care enough to let you get away with it.

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  66. Oh I see, you’re now admitting to having cherry picked what you wanted from your link, but don’t like the fact that I picked up the fact that you replaced the reasoning with your own. Even though the reasoning was the whole point of your piece (so you could keep selling your narrative).

    I cherry picked nothing. I wrote about and linked to an article discussing how business people had a negative feeing about the future. I saw the comment about some fearing less government cheese would hurt them, and decided to ignore it. It more likely than not applies to defense jobs anyway, or maybe to green energy money given to places like Solyndra, and not to social welfare money you want to pretend it does. What I should have done was what I wanted too at first which was point out that this sounded like bias in the article, discuss the fact that the cheese being discussed was either defense spending or government spending money again on stupid things nobody wants but that they want to push on us, and not any kind of welfare spending. I could then actually point out that I have very little sympathy for any business that can’t survive without the government cheese, unless it is a defense oriented business.

    Sorry, you don’t get to do that. If the STATED rationale provided in your own source doesn’t fit your narrative, at the very least look elswhere. Don’t just replace it with your own. Otherwise you just look lazy and stupid.

    Now you are making up bullshit. The article I linked to pointed out that SOME business owners where worried about the loss of their government cheese. Considering how familiar I am with liberals and their pieces, this is fucking Gallup after all, I knew better than to think this piece of information was bullshit at best. Here is the REAL REASON that these business owners, all of them, not the just the few that depend on government cheese, feel is the problem:

    Owners’ intent to reduce capital spending in the months ahead is consistent with a slowing economy. Small-business owners appear to be uncertain about their future operating environment, and uncertainty is a legitimate reason for them to hold back on new capital expenditures at this time.

    Do you see that CM? The problem is U-N-C-E-R-T-A-I-N-T-Y. There are three big contributors to this uncertainty, despite you or Gallup’s attempt to dilute the facts. The first is the current fiscal cliff and the impact that will have on the economy as it guts defense and kills some real high paying jobs. The second is the current tax climate. These small business owners know that once Obama gets to fleece the more successful of them, he still will not get enough money to make a dent in our deficit spending. So they logically expect that it will take more hikes, and who knows how drastic the hikes will be, sooner than later. The final issue is Obamacare. This behemoth will not just cripple businesses everywhere, it will completely and utterly drive some businesses to bankruptcy or to adopt behavior to wait out the parasites in charge, and that change will cripple any chance of economic growth. In fact, I expect a contraction next year.

    But you can pretend that the reason business are all worried are the government welfare cheese programs you keep pretending are so important we should be willing to destroy our economy, and in the process everything else, for. Try again fool.

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  67. I cherry picked nothing. I wrote about and linked to an article discussing how business people had a negative feeing about the future. I saw the comment about some fearing less government cheese would hurt them, and decided to ignore it.

    What a surprise. Not.
    Of course you cherry picked. You decided to leave that part out so you could replace it with your own narrative. You took what you needed and left the rest, even though it was contrary to what you claimed.

    It more likely than not applies to defense jobs anyway, or maybe to green energy money given to places like Solyndra, and not to social welfare money you want to pretend it does.

    Social welfare money? Ah no, any sort of cut in government spending means less money flowing into the economy. That’s fairly basic. It’s not even arguable (which is why Seattle Outcast was only able to drop in his “you don’t know what you’re talking about” line, and not support it with how and why).

    What I should have done was what I wanted too at first which was point out that this sounded like bias in the article, discuss the fact that the cheese being discussed was either defense spending or government spending money again on stupid things nobody wants but that they want to push on us, and not any kind of welfare spending. I could then actually point out that I have very little sympathy for any business that can’t survive without the government cheese, unless it is a defense oriented business.

    I don’t see why making different shit up would have been any better. It’s still making shit up.
    You ARE allowed to acknowledge that government spending affects the economy. It won’t get you kicked out of anywhere Alex.

    Now you are making up bullshit. The article I linked to pointed out that SOME business owners where worried about the loss of their government cheese.

    What bullshit did I make up Alex?
    The quote, again:

    Businesses have shown signs they are holding back on investments because federal austerity plans could trigger a recession next year

    Nothing to do with those businesses getting direct government money of any description.

    Considering how familiar I am with liberals and their pieces, this is fucking Gallup after all, I knew better than to think this piece of information was bullshit at best.

    Right, Gallup, that polling company which consistently showed Romney miles in front. Along with Ramussen, that other infamous lefty hack polling firm.
    Anyway, that’s not the relevant piece.

    Here is the REAL REASON that these business owners, all of them, not the just the few that depend on government cheese, feel is the problem:

    The piece doesn’t say why they are “uncertain about their future operating environment”. It doesn’t look like they were asked. I looked for that when you first posted it.

    Do you see that CM? The problem is U-N-C-E-R-T-A-I-N-T-Y. There are three big contributors to this uncertainty, despite you or Gallup’s attempt to dilute the facts. The first is the current fiscal cliff and the impact that will have on the economy as it guts defense and kills some real high paying jobs. The second is the current tax climate. These small business owners know that once Obama gets to fleece the more successful of them, he still will not get enough money to make a dent in our deficit spending. So they logically expect that it will take more hikes, and who knows how drastic the hikes will be, sooner than later. The final issue is Obamacare. This behemoth will not just cripple businesses everywhere, it will completely and utterly drive some businesses to bankruptcy or to adopt behavior to wait out the parasites in charge, and that change will cripple any chance of economic growth. In fact, I expect a contraction next year.

    Possibly, but the question wasn’t asked so you can only assume. You can’t claim it as fact. And you don’t get to leave out rationale from another link if rationale is what you’re going to argue.
    And again, it looks like only about 3% of small business owners would be affected. And even then, they can choose to put that money into their business (so they get taxed at the old rate).

    I bet you’ll place none of the blame of a contraction on less government spending, even though it’s inarguable that it would place a significant part.

    But you can pretend that the reason business are all worried are the government welfare cheese programs you keep pretending are so important we should be willing to destroy our economy, and in the process everything else, for. Try again fool.

    I’m not pretending anything Alex. You’re the one making shit up to suit your narrative. I simply pointed out something relevant in your link which contradicts your narrative. And now you’re scrambling and digging in deeper when there’s really no reason to because it’s inarguable that less government spending means less money flowing through the system.
    Try again indeed.

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