News Should the Bush tax cuts be extended?

[CAC1001]

Reagan not only got a pass, he got a folk-following for "out-spending" Russia into bankruptcy. Not true. The Soviets were already on the decline and he just happened to be on-watch when the inevitable crash occurred.

Reagan did actually out-spend the Soviet Union into bankruptcy. Gorbachev, in his memoir, mentions this.

From what I have seen, the end of the Cold War is a little more complex than most try to make out. Folks on the Right love to say, "Reagan ended the Cold War," while folks on the Left love to say, "It just happened on his watch." The reality I think is a little of both. Reagan most definitely played a role in breaking the Soviet Union, but he wasn't the sole guy who brought it down (folks like Charlie Wilson for example had roles too).

One claim often made is that the Soviet Union was "in-decline, and was destined to collapse anyhow. But that implies that the Soviet economy had worked for awhile, but then eventually went into decline and collapsed. The reality is really the Soviet economy never worked from the start. It always was in a state of crisis. What Reagan understood, that many others did not, and what many even considered lunacy at the time, was that the Soviet Union was weak and sick, and if you pressured it, you could break it.

In 1984, the Harvard economist John Kenneth Galbraith said that, "for the first time in its history, the Soviet Union is able to pursue successfully a policy of guns and butter as well as growth...the Soviet citizen-worker, peasant, and professional---has become accustomed in the Brezhnev period to an uninterrupted upward trend in his well-being."

He then later that year claimed, "the Soviet system has made great material progress in recent years" and that "the Russian system succeeds because, in contrast with the Western idnustrial economies, it makes full use of its manpower."

Paul Samuelson, a Nobel Prize-winning economist who authored what was one of the most widely read economics textbooks, wrote: "What counts is results, and there can be no doubt that the Soviet planning system has been a powerful engine for economic growth...The Soviet model has surely demonstrated that a command economy is capable of mobilizing resources for rapid growth."

(the quotes are from Natan Sharansky's book The Case for Democracy: The Power of Freedom to Overcome Tyranny and Terror)

When the Soviet Union finally collapsed, the entire Western world was STUNNED at the level of economic decay within it. But at the time, Reagan's quest had seemed rather loony.

Reagan, knowing that the Soviet Union was not economically strong, knew to push it. His pushing it through defense was one area, also through the Strategic Defense Initiative, which ironically while derided and laughed at domestically, the Soviets took very seriously. He pointed missiles back at them when they put missiles into Eastern Europe, and his breaking the Air Traffic Controller's union also got the Soviet's attention. He also called them the "Evil Empire."

It was because of Reagan that the Soviets chose Gorbachev, who was not one of the historical hardliner types the Soviets had always had in the past, as the soviets realized the hardliner method wasn't going to work with Reagan. Gorbachev tried very hard to get Reagan to give up SDI, which Reagan wouldn't (not that SDI was even really an actual thing at the time), and Reagan also denied the Soviets access to crucial technologies they needed, and damaged their efforts for building an oil pipeline which would provide much-needed revenue.

Then there was also Afghanistan, which the Soviets wanted to pull out of, but they wanted to do so in a way that would make it look like they were victorious, but this required Reagan's aid, which he wouldn't give (this is part of the reason why the Soviets remained in Afghanistan, out of fear that pulling out and showing they lost would had been a major blow to the image of Soviet power throughout the world).

Also remember Reagan's support for the Solidarity movement in Eastern Europe, and his focus on sending radio from the free world into Eastern Europe so it could be heard.

We need to gain some perspective, and exercise a bit of honesty with respect to history. I don't see a lot of that in our media, and there's not that much of that perspective on this forum, either.

While Reagan certainly was not the only factor in ending the Soviet Union, he did play a major role.

Right-wing members calling other members Marxists with no repercussions raise some concerns. There is hardly a worse insult, apart from calling people Fascists. How far can we go?

Not calling you a Marxist anywhere here.

 

[CAC1001]

While I think he spent too much, Reagan dealt with a great many complex problems and should be given credit accordingly. He tackled oil prices and inflation, yet cut personal income taxes.

Yes, Reagan also (to some large criticism) ended the price controls on gasoline.

Reagan also gave support to the Federal Reserve as well, for which he took a hit politically. If the Fed raises interest rates, Congress usually cracks down on them pretty hard because it tanks the economy. Reagan's political support to the Fed is part of what allowed it to keep interest rates as high and as long as it did to kill the inflation.

Also, does anyone remember that Reagan attempted to fix Social Security? If I recall, he suggested an increase in FICA withholdings coupled with benefit cuts. If he'd been successful 25 (?) years ago - the system would probably be in a lot better shape today.

Didn't he raise the retirement age and also increase FICA taxes? I think this had bipartisan support, and was because SS was otherwise going to go into deficit.

 

[CAC1001]

The numbers show quite clearly, that it wasn't only the deficit that hit record values, but also spending.

As shown in my previous post. Defense spending wasn't particularly high - it was significantly lower than it had been during the 50s and 60s.

As a percentage of the economy yes, but it still was increased.

When he left office, the deficit was still about as high as it had ever been since the War. And it stayed at those levels all the way through the Bush Sr term.

It began shrinking around 1983, but then began increasing again around 1989; I would imagine maybe the 1987 Stock Market crash might have affected it.

http://www.usgovernmentspending.com...tack=1&size=m&title=&state=US&color=c&local=s

I repeat: defense spending does not even remotely account for the big spending numbers.

Is there a way to see how much of the budget was allocated for defense under Reagan? Also by being scaled back, I was referring to the massive draw-down in defense spending that occurred under George H.W. Bush.

From what I can tell, the primary (in the sense that they were historically high) recipients of the Reagan dollars were Pensions and Welfare.

If I am remembering right, the Congress also refused certain cuts Reagan wanted; they'd go along with his increases in defense, but would not make the welfare state cuts he wanted.

But you're right that he drastically cut spending on Education - he cut it in half.

That's probably where he was also going to cut the lunch program but ultimately decided not to (I am guessing it was part of education spending).

 

[Al68]

No, it's not. You do not know for instance, if for every false claim there are 99 that are deleted by mods. You do not know when those making false claims get infracted for them.

Well, you're right, of course. "Free pass" was just hyperbole, anyway.

 

[Al68]

Right-wing members calling other members Marxists with no repercussions raise some concerns. There is hardly a worse insult, apart from calling people Fascists. How far can we go?

What are you talking about? First, how is the word "Marxist" an insult, even if it was used to refer to a member personally instead of the contents of their post? Many who share the worldview of Democrats are honest and knowledgeable about it and use the word "Marxist" to describe themselves, especially worldwide. I doubt they would appreciate you referring to the word "Marxist" as an insult.

And why would you object, anyway? You have advocated Social Security, and called it socialist, and Marx is generally recognized as the father of socialism. Then you object to the label of "Marxist"? Why would you even object at all, much less call it an insult?

And referring to economic libertarianism as "servitude to the wealthy" isn't a hateful personal insult?

Labeling an ideology I disagree with is an "insult" while hateful attacks on someone's motives isn't? Seriously?

And I'll ask again for the millionth time on this forum: What word or words would accurately describe the economic worldview/ideology of Democrats but won't be objected to? If you have a semantical objection to the word "Marxist" itself, simply provide an appropriate alternative that you don't find objectionable and I'll use it instead.

 

[WhoWee]

And I'll ask again for the millionth time on this forum: What word or words would accurately describe the economic worldview/ideology of Democrats but won't be objected to? If you have a semantical objection to the word "Marxist" itself, simply provide an appropriate alternative that you don't find objectionable and I'll use it instead.

How about "Taxenspendems"

 

[Al68]

What Reagan understood, that many others did not, and what many even considered lunacy at the time, was that the Soviet Union was weak and sick, and if you pressured it, you could break it.

The most interesting thing about Reagan's "lunacy" is that after its collapse, the entire world found out that the Soviet Union was far weaker and sicker the whole time than even Reagan suspected.

 

[Al68]

How about "Taxenspendems"

That's a good description of their specific agenda maybe, but not their underlying worldview/ideology.

 

[mheslep]

Some perspective on the subject.

http://nymag.com/news/intelligencer/topic/69931/
ONE MILLIONAIRE’S TAX BILL
Year: 2000
Income: $406,000
Taxes paid: $40,376 (<10%)

Year: 2009
Income: $398,000
Taxes paid: $18,818 (<5%)
(Money earned through investments is often taxed at a lower rate than wages.)

Amusing. The guy listed there (Nusbaum) is one of those who signed the letter pleading to let the tax rates expire, or increase.

I pay about the same as the 2009 taxes, but I earn quite a bit less than $400K. I don't imagine he works harder than me.

Maybe so, maybe he slacked his way into that income. Perhaps you work seven days a week at a grueling job, starved though school to obtain advanced degrees, and have diligently learned four foreign languages; I would not know. Perhaps you've taken great economic risks, failing multiple times before succeeding to get where you are now, I would not know. How do you imagine you know about the life situation of the guy above?

 

[WhoWee]

The most interesting thing about Reagan's "lunacy" is that after its collapse, the entire world found out that the Soviet Union was far weaker and sicker the whole time than even Reagan suspected.

I believe it was fortunate that Gorby rather than a hard liner was installed AND that collapse happened quickly - a long and drawn out collapse - basically a desperate situation with a hardliner at the controls could have lead to a chilling scenario.

 

[mheslep]

But you're right that he drastically cut spending on Education - he cut it in half.

That's of course Federal education spending, which in my view should be near small, allowing some standard setting and that's about it, leaving the rest to the states.

 

[mheslep]

The reality is really the Soviet economy never worked from the start. It always was in a state of crisis. What Reagan understood, that many others did not, and what many even considered lunacy at the time, was that the Soviet Union was weak and sick, and if you pressured it, you could break it.

That's exactly right.

Commentary editor Norman Podoretz wrote an article in 1984 expressing concerns that Reagan would also fail to have what it took to actually stand up and roll back communism. After all there was an entire chorus of voices (many of whom CAC quoted) saying the Soviets were not so bad, that Reagan was crazy do anything else but live with Soviet domination. http://query.nytimes.com/gst/fullpage.html?res=9A07E7D71330F930A25755C0A9629C8B63" :

After I wrote that article, he called me and spent half an hour on the phone assuring me he was serious about the Soviets. What he basically said was: Trust me, they're in more economic trouble than people realize, and I'm going to put the squeeze on them. Which he did, and he turned out to be right.

Ronald Reagan, with the help the UK's Margaret Thatcher won the cold war. Not happened to be there when the SU fell apart, they won it. All US Presidents before Reagan and including '92 Bush afterwards were fine with merely containing the Soviets. Gerald Ford, for example, another détente devotee, pathetically remained convinced a decade after the fall of the Berlin wall that he deserved much credit for the proper course of action with the Soviets. During more detente under Carter, then http://www.hoover.org/publications/hoover-digest/article/7398"

In January 1977, I visited Ronald Reagan in Los Angeles. During our four-hour conversation, he said many memorable things, but none more significant than this. "My idea of American policy toward the Soviet Union is simple, and some would say simplistic," he said. "It is this: We win and they lose. What do you think of that?" One had never heard such words from the lips of a major political figure; until then, we had thought only in terms of managing the relationship with the Soviet Union

.

 

[Al68]

ONE MILLIONAIRE’S TAX BILL
Year: 2000
Income: $406,000
Taxes paid: $40,376 (<10%)

Year: 2009
Income: $398,000
Taxes paid: $18,818 (<5%)
(Money earned through investments is often taxed at a lower rate than wages.)

I pay about the same as the 2009 taxes, but I earn quite a bit less than $400K.

Am I missing something here? It seems obvious that the reason for that millionaire's low tax bill is tax deductions/loopholes and has very little to nothing to do with the top marginal rate. Clearly his effective tax rate is low because he was able to use deductions/loopholes so that at least most of his income was not subject to the top marginal rate, so raising the top marginal rate would make little or no difference to his taxes.

And it seems obvious why that same millionaire might favor raising the marginal rate instead of closing loopholes: so that the millionaires that actually pay their "fair share" would have their taxes raised instead of his.

 

[Gokul43201]

I think constant dollars, not % GDP, was the way to go on this topic.

I don't think that's particularly useful as a historical comparison, since the total spending in chained dollars is essentially a monotonically increasing function since the beginning of time. But if that's what you want to go with, Reagan's total spending exceeds even that during WWII. Not quite the signature of a model fiscal conservative.

 

[Gokul43201]

What word or words would accurately describe the economic worldview/ideology of Democrats but won't be objected to?

Here's a suggestion - I don't know if its non-objectionable, or even terrible descriptive, but I think it's appropriate - neo-liberalism (to contrast it with classical liberalism).

 

[WhoWee]

Here's a suggestion - I don't know if its non-objectionable, or even terrible descriptive, but I think it's appropriate - neo-liberalism (to contrast it with classical liberalism).

How about Globotaxnsperndemlibs - or "Glotslibs"?

 

[skeptic2]

Is this one of the reasons we got into this mess?

http://www.ontheissues.org/2004/Dick_Cheney_Budget_+_Economy.htm

Former Treasury Secretary Paul O'Neill was told "deficits don't matter" when he warned of a looming fiscal crisis.

O'Neill, fired in a shakeup of Bush's economic team in December 2002, raised objections to a new round of tax cuts and said the president balked at his more aggressive plan to combat corporate crime after a string of accounting scandals because of opposition from "the corporate crowd," a key constituency.

O'Neill said he tried to warn Vice President Dick Cheney that growing budget deficits-expected to top $500 billion this fiscal year alone-posed a threat to the economy. Cheney cut him off. "You know, Paul, Reagan proved deficits don't matter," he said, according to excerpts. Cheney continued: "We won the midterms (congressional elections). This is our due." A month later, Cheney told the Treasury secretary he was fired.

The vice president's office had no immediate comment, but John Snow, who replaced O'Neill, insisted that deficits "do matter" to the administration.

 

[OmCheeto]

How about Globotaxnsperndemlibs - or "Glotslibs"?

Given the myriad of graphs I generated to contradict your statement, I'd think "Notabunchofliars" would be more appropriate to describe the Dems.

 

[WhoWee]

Given the myriad of graphs I generated to contradict your statement, I'd think "Notabunchofliars" would be more appropriate to describe the Dems.

Are you saying that Dems don't like to tax and spend?

 

[Gokul43201]

Are you saying that Dems don't like to tax and spend?

Care to estimate how much MORE taxes we have been paying compared to 2, 3, or 4 years ago, as a result of legislation passed by the tax-loving Dems? By my count, somewhere over $300 billion worth of NET tax cuts have been passed in the last couple of years, but obviously that must be wrong, since Dems only raise taxes, not cut them.

 

[skeptic2]

Are you saying that Dems don't like to tax and spend?

I can't speak for OmCheeto but taxing and spending is not a matter of liking or not liking. Taxing and spending is what government does by necessity. The priorities for taxing and spending may be argued but both Republicans and Democrats tax and spend.

 

[turbo]

I can't speak for OmCheeto but taxing and spending is not a matter of liking or not liking. Taxing and spending is what government does by necessity. The priorities for taxing and spending may be argued but both Republicans and Democrats tax and spend.

Or borrow and spend. Prosperity for some can be engineered, as long as you are willing to defer the payments to some future reckoning. The trouble is that DC has that credit-card mentality ingrained and both parties know how to play that game to their benefit. We should go to a pay-as-you-go budgetary system except in the case of dire emergencies, like unforeseen wars. Some fiscal restraint would be quite welcome.

 

[skeptic2]

So how do we change from a borrow and spend government to a pay as you go government. We're still talking about cutting taxes while increasing spending.

 

[turbo]

So how do we change from a borrow and spend government to a pay as you go government. We're still talking about cutting taxes while increasing spending.

Cutting wasteful spending would be a start. Farm subsidies overwhelmingly go to millionaires and huge agribusinesses, not to small local farms. Ever wonder why presidential candidates all have to pay homage to Iowa? Next, stop subsidizing "fuels" that cost more to produce than they can be sold for. Ethanol from corn is a huge scam, and it is making our fuel unstable and even damaging to many small engines. Every time I fill my fuel cans at the gas station, I have to add expensive fuel stabilizer to them or risk having to pay the "backdoor tax" of small engine repair. I can do a lot of that repair work myself, but most people are poorly equipped for that.

These are very modest suggestions - we need to explore many more of them. Unfortunately, the Dems and the GOP only gain financial support by funneling our money into spending programs that benefit their sponsors - not by cutting spending.

It may be necessary to force real campaign finance reform onto our elected representatives, before we can expect any change in their behaviors.

 

[WhoWee]

Care to estimate how much MORE taxes we have been paying compared to 2, 3, or 4 years ago, as a result of legislation passed by the tax-loving Dems? By my count, somewhere over $300 billion worth of NET tax cuts have been passed in the last couple of years, but obviously that must be wrong, since Dems only raise taxes, not cut them.

I you want to have an honest analysis of Democrats taxing and spending in our modern era - let's go back to Johnson.

 

[turbo]

I you want to have an honest analysis of Democrats taxing and spending in our modern era - let's go back to Johnson.

If you want to play this game, perhaps we should go back to Grant, Hayes, or T Roosevelt? Or back to Washington? Context is everything, and if you want to demonize a president by making historical comparisons, your argument fails by fiat. Taxation and spending is only relevant in context. Can we at least agree on that?

 

[WhoWee]

If you want to play this game, perhaps we should go back to Grant, Hayes, or T Roosevelt? Or back to Washington? Context is everything, and if you want to demonize a president by making historical comparisons, your argument fails by fiat. Taxation and spending is only relevant in context. Can we at least agree on that?

What game turbo? Do you want to discuss current problems or historical issues? We are dealing with Social Security and welfare programs as a component of the budget and deficits. If you want to go back beyond Johnson please explain why it is appropriate.

Keeping Bush tax cuts or not is the "game" - it's a shell game and class warfare - we need to address the problem in it's entirety.

 

[turbo]

Keeping Bush tax cuts or not is the "game" - it's a shell game and class warfare - we need to address the problem in it's entirety.

The right frames it in this way. Is it "class warfare" to ask the wealthy to support the political system that made it possible for them to earn and accumulate fortunes? The wealthy have a pretty robust entitlement program in the US and they can strip more tax dollars out of us than the apocryphal "welfare queens" could ever manage.

Why is it so hard to understand this? All the outrage over the earned income tax credit, and not a peep over the low rates for capitol gains rates. Why? Normal folks have all their income taxed at a relatively high rate. Wealthy people can often shuttle their income into categories that lower their tax liabilities. Most regular folks cannot. Why rally to protect shelters for millionaires, unless you have a reliable expectation of joining their ranks? I came from a family of modest means, born of parents who grew up in the Depression. My mother was always unconditionally supportive, but my father was absolutely horrified by my support of Goldwater.

 

[WhoWee]

The right frames it in this way. Is it "class warfare" to ask the wealthy to support the political system that made it possible for them to earn and accumulate fortunes? The wealthy have a pretty robust entitlement program in the US and they can strip more tax dollars out of us than the apocryphal "welfare queens" could ever manage.

Why is it so hard to understand this? All the outrage over the earned income tax credit, and not a peep over the low rates for capitol gains rates. Why? Normal folks have all their income taxed at a relatively high rate. Wealthy people can often shuttle their income into categories that lower their tax liabilities. Most regular folks cannot. Why rally to protect shelters for millionaires, unless you have a reliable expectation of joining their ranks? I came from a family of modest means, born of parents who grew up in the Depression. My mother was always unconditionally supportive, but my father was absolutely horrified by my support of Goldwater.

Are you in favor of a capital gains increase for everyone - or just the "rich"? BTW - I've noticed there is no mention of the death tax proposals in this thread .

Anytime you want legislation where 2 to 5% of the people are expected to pay for everyone else - and give more to the other 95 to 98% - it's class warfare.

 

[mheslep]

I don't think that's particularly useful as a historical comparison, since the total spending in chained dollars is essentially a monotonically increasing function since the beginning of time. But if that's what you want to go with, Reagan's total spending exceeds even that during WWII. Not quite the signature of a model fiscal conservative.

I think you are conflating two issues. I tried to separate these two issues above: i) absolute defense build up and its pressure on the Soviets, ii) fiscal impact on the US. For i) we want constant/chained dollars, for ii) we want percent GDP. Also a fiscally conservative President should spend primarily on that which the constitution sets aside the federal government for - defense, when it is necessary, and it was necessary in the cold war in my view.

 

[mheslep]

Cutting wasteful spending would be a start. Farm subsidies overwhelmingly go to millionaires and huge agribusinesses, not to small local farms. Ever wonder why presidential candidates all have to pay homage to Iowa? Next, stop subsidizing "fuels" that cost more to produce than they can be sold for. Ethanol from corn is a huge scam, and it is making our fuel unstable and even damaging to many small engines.

Agreed. Unfortunately the ethanol subsidy is part of this tax compromise, of all places, thanks mainly but not solely to Harkin and Nelson. Its outrageous to put ethanol subsidies in the tax package.

WASHINGTON -(Dow Jones)- A tax credit that helps the ethanol industry appears to have survived an effort to cut or eliminate it and is likely to be in a tax package working its way through Congress, Democratic senators said Thursday.
"As far as I know they're in and should not be," Sen. Dianne Feinstein (D., Calif.) told reporters as she headed into a vote. Sen. Tom Harkin (D., Iowa) and Sen. Ben Nelson (D., Neb.) said later that a one-year extension of the 45-cent-a-gallon credit for blending ethanol into gasoline would be added to the Senate tax package.

http://www.foxbusiness.com/markets/2010/12/09/sen-feinstein-ethanol-tax-credit-included-tax-compromise/#ixzz17k5jpfYE

As an aside, from living close by, I've come to know that the best party hosts in Washington, DC, are the Congressional delegations of farm states and their agricultural lobbying associations - Sugar, Cattlemen, etc. Hoards of money.

 

[WhoWee]

Agreed. Unfortunately the ethanol subsidy is part of this tax compromise, of all places, thanks mainly but not solely to Harkin and Nelson. Its outrageous to put ethanol subsidies in the tax package.


http://www.foxbusiness.com/markets/2010/12/09/sen-feinstein-ethanol-tax-credit-included-tax-compromise/#ixzz17k5jpfYE

One more excellent example of the need for smaller Bills - with a laser focus. I'd rather see nothing happen than to cram an extension of these tax rates with wasteful Pork.

 

[mheslep]

Care to estimate how much MORE taxes we have been paying compared to 2, 3, or 4 years ago, as a result of legislation passed by the tax-loving Dems? By my count, somewhere over $300 billion worth of NET tax cuts have been passed in the last couple of years, but obviously that must be wrong, since Dems only raise taxes, not cut them.

I'd care to try.

o Yes there was a little less than $300B of tax credits in the stimulus, total, over 3-4 years, some still into the future. I don't call them cuts, because they were mostly extended for things like buying a car, college tuition, energy savings features on the residence, i.e. things on which the government tells you to spend. Same goes for the business tax credits, yes for renewable energy, yes for government contractors, not so much for everyone else.
http://en.wikipedia.org/wiki/American_Recovery_and_Reinvestment_Act_of_2009#Tax_incentives

o The health care act raised tax revenues, by CBO scoring, some $550B over 2010-2019, starting mostly in 2012. These taxes are on everyone, from tanning salons (already in effect), to a 40% tax on cadilac health plans, $50k tax on some hospital orgs, cosmetic surgery, 2.5% tax on individuals who do not get coverage, etc, etc.
http://www.cbo.gov/ftpdocs/113xx/doc11355/hr4872.pdf. Table 1
http://www.businessinsider.com/heal...als-without-acceptable-health-care-coverage-9

o The Democrats, about 90% of Congressmen and the President, would have raised the top bracket income, estate, and dividend taxes $700B over the next ten years, and they still might.

Yes I think it is fair to say, on net, that Democrats at the federal level are mostly about raising taxes.

 

[WhoWee]

I just watched President Obama introduce former President Clinton at a White House press conference. The Former President then held the press conference (with the current President looking on) and spoke about the tax extension proposal being negotiated. At some point President Obama said his wife was waiting and departed - former President Clinton continued the Press conference and Gibbs stood ready to field questions afterward. What is going on - has anything like this ever happened before?

 

[Gokul43201]

I'd care to try.

o Yes there was a little less than $300B of tax credits in the stimulus, total, over 3-4 years, some still into the future. I don't call them cuts, because they were mostly extended for things like buying a car, college tuition, energy savings features on the residence, i.e. things on which the government tells you to spend. Same goes for the business tax credits, yes for renewable energy, yes for government contractors, not so much for everyone else.
http://en.wikipedia.org/wiki/American_Recovery_and_Reinvestment_Act_of_2009#Tax_incentives

Most of the tax credits were not extended for things that you had to spend money on. That's just not true. Most of it came to you through the payroll credit, the child tax and raising the AMT floor. As far as I'm aware, Cash for Clunkers was not a part of the ARRA. And the homebuyer and energy savings credits make up a lot less than 10% of the total. The vast majority of people that benefit from the tuition credit were likely already in school, but even if you throw that entire group in with those that were being forced to spend money, it still doesn't quite make it much past 10% of the total.

So far that accounts for about $150B to $200B in less taxes paid so far over the last couple of years.

And this only counts the tax provisions that arise from ARRA. There seem to have been plenty of other tax cuts that have since passed, which I have been hearing about on the radio, including the small business tax cuts that were repeatedly blocked by Republicans, but did eventually pass.

o The health care act raised tax revenues, by CBO scoring, some $550B over 2010-2019, starting mostly in 2012. These taxes are on everyone, from tanning salons (already in effect), to a 40% tax on cadilac health plans, $50k tax on some hospital orgs, cosmetic surgery, 2.5% tax on individuals who do not get coverage, etc, etc.
http://www.cbo.gov/ftpdocs/113xx/doc11355/hr4872.pdf. Table 1
http://www.businessinsider.com/heal...als-without-acceptable-health-care-coverage-9

So, until now, there has been very little additional tax paid as a result of the Healthcare Bill (less than $20B perhaps?), but if things do not change in the coming years, there will be a lot more. I'll be happy to count those dollars as tax increases at the time that they do kick in. Who knows what may happen in 2012? Parts of the bill may be amended or repealed. Other tax cuts and credits may be passed. When it's the end of 2012, we can figure out how much taxes were paid in 2012. Right now, we can only speak with knowledge of the taxes we've been paying thus far.

o The Democrats, about 90% of Congressmen and the President, would have raised the top bracket income, estate, and dividend taxes $700B over the next ten years, and they still might.

First it was a "will", then it was a "won't". Now it's a "would have". I think it's prudent to wait and see what actually happens and redo the math when we know the numbers.

Yes I think it is fair to say, on net, that Democrats at the federal level are mostly about raising taxes.

This may yet be borne out, given the time and opportunity, but so far, there is no direct evidence supporting this based on the past two tax years. Clearly, the recession forced the hand of Dems to pass tax cuts that they might not have passed under normal circumstances. But that only disqualifies any argument that the Dems are tax cutters based on their recent history; it doesn't prove that they are tax raisers.

My own personal opinion is that the Dems in office today are happy to cut taxes on low and middle income households and happy to raise them on high income households.

 

[mheslep]

Most of the tax credits were not extended for things that you had to spend money on. That's just not true.

I meant the government "tells you" to spend only in the sense of, "if you, home owner, replace your windows or buy this particular car, I'll pick up a share of the tab for you." People thus spend on thing they would not have otherwise.

 

[Al68]

Here's a suggestion - I don't know if its non-objectionable, or even terrible descriptive, but I think it's appropriate - neo-liberalism (to contrast it with classical liberalism).

Too much of a contrast. The prefix neo doesn't mean "opposite of".

 

[Gokul43201]

I meant the government "tells you" to spend only in the sense of, "if you, home owner, replace your windows or buy this particular car, I'll pick up a share of the tab for you." People thus spend on thing they would not have otherwise.

Unless I'm still missing some subtle point here, that is how I interpreted that. But the numbers don't justify it. About half the tax credits, for instance, were in the form of a payroll credit - no spending necessary whatsoever (etc.).

 

[CAC1001]

Why is it so hard to understand this? All the outrage over the earned income tax credit,

This is actually a Republican invention I believe.

and not a peep over the low rates for capitol gains rates.

If stocks, I think this is (at least in theory) because the corporations themselves pay corporate taxes and taxes on their own dividend income from investments. Income received from capital gains via stocks or dividend income the corporation pays out to the shareholders, when taxed, it thus can be a triple tax, so the capital gains and dividend taxes are kept lower than marginal income taxes.

In terms of Democrats being for "tax-and-spend," I think this is because the large social welfare state they desire to create, which of course requires lots of spending, and this inevitably requires taxes. In Europe, they fund this through ordinary income taxes, VAT taxes, I think higher fuel taxes, and also if a country like Germany, people are mandated to purchase health insurance, which is a form of tax as well (don't purchase and pay a fine).

 

[mheslep]

As far as I'm aware, Cash for Clunkers was not a part of the ARRA.

I didn't mean clunkers. I meant the sales tax deduction, which was in the ARRA:

$1.7 billion: for deduction of sales tax from car purchases, not interest payments phased out for incomes above $250,000.

(wiki)

So far that accounts for about $150B to $200B in less taxes paid so far over the last couple of years.

Yes, ok, for the ARRA.

And this only counts the tax provisions that arise from ARRA. There seem to have been plenty of other tax cuts that have since passed, which I have been hearing about on the radio, including the small business tax cuts that were repeatedly blocked by Republicans, but did eventually pass.

What you are hearing about there are numerous only in the amount of specialized, here, there, cutouts, and not any large dollar sum outside the ARRA tax credits.

So, until now, there has been very little additional tax paid as a result of the Healthcare Bill (less than $20B perhaps?), but if things do not change in the coming years, there will be a lot more. I'll be happy to count those dollars as tax increases at the time that they do kick in. Who knows what may happen in 2012? Parts of the bill may be amended or repealed. Other tax cuts and credits may be passed. When it's the end of 2012, we can figure out how much taxes were paid in 2012. Right now, we can only speak with knowledge of the taxes we've been paying thus far.

That's all beside the point, which at the moment is as raised by Who Wee: which party is more inclined to raise taxes.

I think it's prudent to wait and see what actually happens and redo the math when we know the numbers.
...
[This may yet be borne out, given the time and opportunity, but so far, there is no direct evidence supporting this based on the past two tax years. Clearly, the recession forced the hand of Dems to pass tax cuts that they might not have passed under normal circumstances. But that only disqualifies any argument that the Dems are tax cutters based on their recent history; it doesn't prove that they are tax raisers.

Whether or not the taxes have gone into effect yet ( in the case of health care) is not relevant. The Dems drafted the legislation and enacted it, and that is evidence enough. After all, the point of the discussion must be to judge a future course based on the actions of legislators taken now. I for one don't say I need to sit around until 2014 to gauge that course given we have legislation on paper.

My own personal opinion is that the Dems in office today are happy to cut taxes on low and middle income households and happy to raise them on high income households.

I agree on the income taxes, at least for the President. On other taxes like those placed on health care, no, I think that will hit everyone, especially for the case of the failure to insure 'tax'. Still the topic was not on which class the Dems may raise taxes, but whether they do or not.

 

[Gokul43201]

Too much of a contrast. The prefix neo doesn't mean "opposite of".

I don't think it should. I don't think present day Dems (to make a crude average over the positions of people in office today) are the opposite of classical liberals. I think they are fairly similar to old school liberals along the social freedoms axis, but very dissimilar along the economic freedoms axis.

 

[Al68]

The right frames it in this way. Is it "class warfare" to ask the wealthy to support the political system that made it possible for them to earn and accumulate fortunes?

Who's saying that? Nobody is saying that in this thread. The cost of that is but a small fraction of the taxes paid by the rich, and nobody is advocating that they not pay for it.

The wealthy have a pretty robust entitlement program in the US and they can strip more tax dollars out of us than the apocryphal "welfare queens" could ever manage.

Nobody is advocating that in this thread, either.

Why is it so hard to understand this?

Who is having a problem understanding that?

All the outrage over the earned income tax credit, and not a peep over the low rates for capitol gains rates. Why?

The same libertarian/conservative principles that have been explained ad nauseum to no avail.

Normal folks have all their income taxed at a relatively high rate.

Not relative to the rich in general. This has been proven repeatedly in this forum based on the CBO numbers http://www.cbo.gov/ftpdocs/88xx/doc8885/EffectiveTaxRates.shtml".

Wealthy people can often shuttle their income into categories that lower their tax liabilities. Most regular folks cannot. Why rally to protect shelters for millionaires, unless you have a reliable expectation of joining their ranks?

Nobody is advocating that in this thread.

It's pretty easy to argue against things nobody is arguing for, huh?

 

[Gokul43201]

The cost of that is but a small fraction of the taxes paid by the rich, and nobody is advocating that they not pay for it.

Do you have a number? I haven't seen an estimate, and have imagined it would be pretty difficult to make one.

 

[Al68]

I don't think it should. I don't think present day Dems (to make a crude average over the positions of people in office today) are the opposite of classical liberals. I think they are fairly similar to old school liberals along the social freedoms axis, but very dissimilar along the economic freedoms axis.

Yes, but I was asking about a word to describe their economic beliefs, not their social issue positions. The social issue positions of many Dems could be called classical liberal, or libertarian, and I agree with them on those issues.

 

[Al68]

Do you have a number? I haven't seen an estimate, and have imagined it would be pretty difficult to make one.

No, you're right, it would be difficult to get an exact number, but the cost of "the political system that made it possible for them to earn and accumulate fortunes" clearly excludes the overwhelming majority of the federal budget, and this is immediately obvious from a mere glance at a budget pie chart. And just as obvious is that it was very possible for the rich to "earn and accumulate fortunes" prior to the existence of the programs that constitute the bulk of the budget.

 

[Gokul43201]

No, you're right, it would be difficult to get an exact number, but the cost of "the political system that made it possible for them to earn and accumulate fortunes" clearly excludes the overwhelming majority of the federal budget, and this is immediately obvious from a mere glance at a budget pie chart.

It's not immediately obvious to me, but then I haven't given it a whole lot of careful thought. Maybe as an exercise at testing this, you could suggest a spending sector from the Federal budget pie chart that you say is irrelevant to the wealth acquiring power of the high income segment, and someone else (turbo or I, perhaps) could attempt to find ways in which it would be relevant.

And just as obvious is that it was very possible for the rich to "earn and accumulate fortunes" prior to the existence of the programs that constitute the bulk of the budget.

But were they able to earn and accumulate fortunes to the extent that they now are? I think most any measure of the wealth of the high-income groups relative to some standard measure (e.g., median income, poverty level, <you propose a suitable standard>) reveals a significantly greater ability to earn and acquire fortunes compared to the times when these programs were not in place. By the converse your argument, this points a finger towards the possibility that these programs may have been playing a role in this enhanced ability.

 

[CRGreathouse]

But were they able to earn and accumulate fortunes to the extent that they now are? I think most any measure of the wealth of the high-income groups relative to some standard measure (e.g., median income, poverty level, <you propose a suitable standard>) reveals a significantly greater ability to earn and acquire fortunes compared to the times when these programs were not in place. By the converse your argument, this points a finger towards the possibility that these programs may have been playing a role in this enhanced ability.

It's possible that I misunderstand you, but that seems 'obviously' wrong. The majority of the budget (51% as of 2008, you can check other years for comparison if you like) goes to social security, Medicare/Medicaid/CHIP/etc. (where "etc." refers to other 'safety net' programs like unemployment payments). How would these help the present rich to have gained their fortunes? (Not exactly sure what you mean by "rich", but something in the upper 50% surely, probably in the top 1%.)

 

[Al68]

It's not immediately obvious to me, but then I haven't given it a whole lot of careful thought. Maybe as an exercise at testing this, you could suggest a spending sector from the Federal budget pie chart that you say is irrelevant to the wealth acquiring power of the high income segment, and someone else (turbo or I, perhaps) could attempt to find ways in which it would be relevant.

But were they able to earn and accumulate fortunes to the extent that they now are? I think most any measure of the wealth of the high-income groups relative to some standard measure (e.g., median income, poverty level, <you propose a suitable standard>) reveals a significantly greater ability to earn and acquire fortunes compared to the times when these programs were not in place. By the converse your argument, this points a finger towards the possibility that these programs may have been playing a role in this enhanced ability.

No, because those programs aren't the only difference, and there just isn't a logical or empirically derived connection between them.

You just can't claim that the social security program, for example, is necessary for the purpose of "making it possible for the rich to earn and accumulate fortunes", and justify it in that way. Ditto for other social programs.

But I really have no interest in trying to counter a claim that the social agenda of the Democratic Party over the last century was to benefit the rich. I don't think anyone is claiming such a thing, in fact Democrats typically claim that their agenda, which represents the bulk of the federal budget, is in opposition to the interests of the rich.

But the rich do benefit from the federal government's primary purpose, protecting our liberty, to a far greater extent than the poor, and they should pick up the tab for that. Nobody is arguing otherwise, which was my point.

 

[turbo]

It's possible that I misunderstand you, but that seems 'obviously' wrong. The majority of the budget (51% as of 2008, you can check other years for comparison if you like) goes to social security, Medicare/Medicaid/CHIP/etc. (where "etc." refers to other 'safety net' programs like unemployment payments). How would these help the present rich to have gained their fortunes? (Not exactly sure what you mean by "rich", but something in the upper 50% surely, probably in the top 1%.)

Once again, SS is self-funded, and is not a drain on our budget. Alan Simpson and his pals would have you think otherwise, but it is NOT true. Small tweaks can keep SS cooking along for the foreseeable future.

 

[CRGreathouse]

But the rich do benefit from the federal government's primary purpose, protecting our liberty, to a far greater extent than the poor, and they should pick up the tab for that. Nobody is arguing otherwise, which was my point.

I've tried a few times to start discussions relating to that point here, but with little or no success.