posted
As I see it, our economy is not successful because it depends on eternal growth, which is impossible. Growth is both the goal and the measurement of success, but it is unhealthy in the long term. The growth imperative is created by the central banks creating money as debt that must be repaid with interest. Neither Obama's administration nor this commentator offer an alternative though, so this kind of debate is a little boring to me.
Posts: 1592 | Registered: Jan 2001
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posted
I agree that perpetual growth isn't the answer in a world of limited resources.
I only have one question.....do you work for a guy that makes less than 200k per year?
If the owner of your company makes more than that, his profit has been cut. Can he afford to hire another $40k worker when his taxes went up by $40k? When he decides not to hire that individual, how much productivity did he lose?
Eliminate income tax and institute a national sales tax. Rich people like to spend money too....they'll still pay more taxes. Lifestyle isn't money in the bank...it's money spent. Of course, it's unfair that ALL American's pay the same percentage in taxes. Welfare recipients that make no money like their 6k tax returns and somehow, not renewing the Bush tax breaks is considered a "cost to the government".
Common sense doesn't apply. The wealthy don't "cost" the government anything.
Idiots line up to rally against the evil oil companies...the same idiots get what they deserve when they go to the pump to fill up their tanks. Cigarette taxes are easier to comprehend than gas taxes...not everyone smokes. Smokers understand a tax on tabacco is a tax on the consumer...the majority of which are lower income.
Posts: 1495 | Registered: Mar 2009
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I work for a corporation so, income tax doesn't really affect our ability to hire. If anything, we'd be much better off cutting taxes to the poor than the wealthy. I work in a restaurant. Cutting taxes for the extreme minority, at an extremely high cost, means they only put so much of that back into the economy as consumers. They're only going to eat out so many times, buy so many iPods, etc. Spread that money out among hundreds of thousands and it circulates a lot faster.
A national sales tax is inherently regressive unless you include rebate checks to lower income people. I'm okay with some form of a national sales tax, but not a flat tax without modifications.
I think you got something backwards there. Renewing the tax cuts DOES cost money. It removes income from the government. That either has to be made up by raising taxes elsewhere or by cutting spending. I'm perfectly fine with cutting spending, but without it, then it's an added cost, mostly because it isn't accounted for in long term budget plans.
What is your problem with gas taxes? Theoretically, gas taxes go towards paying for road repairs, and the only people who pay them are people who drive. It's PERFECTLY targeted. I think we should have raised the gas tax by a dollar or a dollar fifty over the last 15 years. Dumbest thing we could have done was to leave it so low.
Posts: 21898 | Registered: Nov 2004
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I'm confused. Are you going to let people's comments lead the discussion or not?
It seems like you said you would and then almost immediately violated that. This just seems bizarre to me.
Posts: 10177 | Registered: Apr 2001
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quote:Originally posted by Lyrhawn: I work for a corporation so, income tax doesn't really affect our ability to hire. If anything, we'd be much better off cutting taxes to the poor than the wealthy. I work in a restaurant. Cutting taxes for the extreme minority, at an extremely high cost, means they only put so much of that back into the economy as consumers. They're only going to eat out so many times, buy so many iPods, etc. Spread that money out among hundreds of thousands and it circulates a lot faster.
A national sales tax is inherently regressive unless you include rebate checks to lower income people. I'm okay with some form of a national sales tax, but not a flat tax without modifications.
I think you got something backwards there. Renewing the tax cuts DOES cost money. It removes income from the government. That either has to be made up by raising taxes elsewhere or by cutting spending. I'm perfectly fine with cutting spending, but without it, then it's an added cost, mostly because it isn't accounted for in long term budget plans.
What is your problem with gas taxes? Theoretically, gas taxes go towards paying for road repairs, and the only people who pay them are people who drive. It's PERFECTLY targeted. I think we should have raised the gas tax by a dollar or a dollar fifty over the last 15 years. Dumbest thing we could have done was to leave it so low.
Do you work for an American Corporation? If you do, we have the 2nd highest corporate income tax rate in the world.....and wonder why our jobs are outsourced.
Initially we were called "These United States of America". We were founded as a coalition of sovereign states. Now we are "THE United states"......subtle difference, I know. Soon it'll be illegal for Alabama to "outsource" Michigan auto worker jobs....out of fairness.
I fail to understand how you can consider a national sales tax to be "regressive". If I buy a million dollar home I pay more than someone who purchases a 50k home. Money in the bank only helps the economy. Wealthy people who leave their money in the bank increase the lending pool. Even Obama admits, lending is a problem...liquidity is limited. Of course, that has nothing to do with government spending. Every dollar spent by the government is a dollar lost in the productive private sector.
My only complaint with gas taxes is this...the 1c tax was suppose to pay for the roads just as your social security taxes paid for social security. Unfortunately, they didn't spend the gas tax on the roads or the social security tax on social security. During time's of plenty, they spent the excess on other promises....vote for me and I'll buy you ice cream.
It's coming to a head....the pyramid scheme is about to collapse.
Most states asked people to approve the lottery.....lottery profits were going to pay for schools. What do you hear now? If we don't raise taxes, teachers will be laid off. The lotto alone, was sold to voters as school funds. Social security.... The toll on that bridge that was built 50 years ago......that bridge has been paid for a hundred times over. The toll is law, despite the reason for the tax. They spend it on what they want to. Mostly,...they spend it to get votes. Getting it passed in the first place is the problem. Until the government eliminates a general fund...this will continue. Taxes will be increased for sewage, teachers and police....despite the fact the initial taxes passed for sewage, teachers and police more than covers the cost of sewage, teachers and police.
quote:I fail to understand how you can consider a national sales tax to be "regressive".
Do you know what a "regressive" tax is? If not, Google it. Instantly, your question is answered.
But, yes, it annoys me when a fee or "temporary" tax increase is justified by new construction and/or a capital investment, and then not phased out when that investment is paid for.
Posts: 37449 | Registered: May 1999
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I googled it.. "A regressive tax is a tax imposed in such a manner that the tax rate decreases as the amount subject to taxation increases"
That's not what I prefer. I prefer a flat tax. Spend money, pay a tax. Of course, if a "regressive" tax is defined by above...our current "progressive" administration must love the dutiful, government dependent voters, getting $6k tax returns while making $0.....that is certainly "progressive".
Money in the bank is good for the economy....lending liquidity. Money spent, elevates a person's lifestyle. I don't mind paying 10k in taxes to buy a 100k house. The "evil rich guy" wont live in my house, his 10% tax for his million dollar house could buy mine. Rich or poor, equal stake...equal percent.
There is no "regressive tax" only "progressive tax". The progressive tax ends up costing a poor person his job. True, there are billionaires that hire 20k a year welfare recipients...who's the first to get laid off when the company gets slammed with a tax increase.
To spite your face..... Maybe smokers have more experience. Poor smokers hate tobacco taxes....it only gets passed on.
All taxes are "regressive". The people at the bottom pay for all of them. Of course, socialist governments have taken the next logical step and taken over the companies producing the goods and hiring the people.
Corporations faced with higher taxes have two choices: lay off employees or raise prices. It's compounded since corporation A buys products from corporation B, who raised their prices due to the same taxes or can't deliver needed components for the same reason.
Posts: 1495 | Registered: Mar 2009
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Blayne Bradley
unregistered
posted
Rich individuals, when their rich, sit on their wealth or let it accumulate through interest, none will actually invest it regardless of tax cuts.
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Even when they "sit on it"...the bank it is in, is lending it. Ever hear about a "run on a bank"? Banks that were lending yesterday fail the day all the rich people decide to withdraw their money.
This is the origin of the FDIC. People didn't trust banks...they don't have the liquid assets to cover the accounts of all their customers. They lend out and invest the savings of the evil rich people.
Poor people get loans due to rich people "holding on to their money". When all the rich people show up and want their money, banks collapse.
Posts: 1495 | Registered: Mar 2009
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quote:Originally posted by Blayne Bradley: Rich individuals, when their rich, sit on their wealth or let it accumulate through interest, none will actually invest it regardless of tax cuts.
Huh? Are you seriously suggesting that rich people get to a certain point and then just start stuffing their mattresses with cash? How exactly do you get interest on something without investing it in one form or another?
Posts: 135 | Registered: Apr 2006
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posted
Intriguingly, it looks like the consensus in the states is reversed from that in Canada. Here, Liberals raise sales taxes to lower income tax while conservatives raise income tax to cut sales tax.
On this issue, Mal sounds a lot like a Liberal! Congrats!
Posts: 7593 | Registered: Sep 2006
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posted
I get confused when semantics cross national lines. If a liberal in Canada is for sales tax and you're Canadian....call me liberal.
All people should have an equal share. Even the welfare recipient with 6k in child tax credit "refunds", spends his money.
Wealthier people have a higher quality of life. For that higher quality of life they pay "more" to society....at the same rate. With a national sales tax, that would be the case...the more you spend, the more you pay. Wealthy people that only earn and save,...the money they reinvest and save is also good for the economy. Banks lend rich people's money to the poor. Banks don't collapse when poor people show up demanding withdrawals.
If I'm a liberal in Canada, Canadians should consider me a liberal. Quality of character and position is more important than labels.
American liberal "progressives" don't believe in equal share, they believe in redistribution.
Posts: 1495 | Registered: Mar 2009
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ScottF: the rich, according to every study I've seen, utilize and circulate a far lower percentage of their income. While the bulk of their disposable income is invested, enough of it is not that they're a drain on the economy overall.
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quote:Wealthier people have a higher quality of life. For that higher quality of life they pay "more" to society....at the same rate.
This ignores basic principles of economic reality, mal. Do I really need to explain to you why taxing someone 15 cents on his last dollar is categorically worse than taxing someone $150,000 on his million?
Posts: 37449 | Registered: May 1999
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quote:Theoretically, gas taxes go towards paying for road repairs, and the only people who pay them are people who drive.
I disagree. The taxes on gas are factored into the price of any good or service you purchase that has to be transported. That's pretty much everything. When gas prices go up everyone pays for it whether you drive or not.
Posts: 14428 | Registered: Aug 2001
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posted
Sales taxes are regressive meaning that the poor end up paying a higher percentage of their income than the wealthy. Imagine two people buying groceries. They both buy $300 worth of groceries with a 10% flat tax. They both pay $30 in tax. now one of them makes 25k a year and one makes 100k a year. The poor man spent .0012% of his income in taxes. The wealthier man spent .0003. The poor man was taxed 4 times as much as a percentage of income as the rich man.
It gets even worse for the poor man because he spends 75% of his income on goods and the other 25% of his income on housing which has an interst rate attached to it. The wealthy man spends 50% of his income on goods 25% on housing and puts the other 25% in investments. The investment money never gets taxed and he earns an interest on it that can be used to offset his housing interest. So the poor man pays tax or interest on 100% of his money while the wealthy man pays on only 50%. Furthermore, the poor man is much more likely to need his money to buy necessities while the rich man is likely to use a much larger portion of his money on luxuries. So that when the tax requires cutbacks, the poor man cuts out things like insurance, proper nutrition, and reliable vehicles while the wealthier man cuts back on vacations and savings. On what level then would a sales tax not be regressive in both impact and on percentage paid?
As the sales tax got more harsh, it would also be more likely to be avoided by the wealthy. For example the wealthy man could go buy his large ticket items overseas or on the internet. This method doesn't work at all for the person spending all of their income on small items and necessities. For the uberwealthy this is especially true. Imagine what a small percentage of income someone like Bill Gates spends on goods within the US in a given year compared to a family of four with 80k in income. As a percentage it would be a laughable comparison.
quote:Originally posted by malanthrop: I get confused when semantics cross national lines. If a liberal in Canada is for sales tax and you're Canadian....call me liberal.
Big "L" Liberal even.
Posts: 7593 | Registered: Sep 2006
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quote:Originally posted by theresa51282: Imagine two people buying groceries. They both buy $300 worth of groceries with a 10% flat tax. They both pay $30 in tax. now one of them makes 25k a year and one makes 100k a year. The poor man spent .0012% of his income in taxes. The wealthier man spent .0003. The poor man was taxed 4 times as much as a percentage of income as the rich man.
The poor man at an income of $20,000 would pretty much receive the maximum sales tax credit which would offset most of the taxes on the vehicle. Besides, the poor man should be encouraged to use mass transit in the first place, transit passes are not sales-taxed.
Edit to add: This is a bit confusing, I think the previous post was initially about tax on car purchases. But the groceries are roughly equivalent since there is no sales tax on groceries.
quote: It gets even worse for the poor man because he spends 75% of his income on goods and the other 25% of his income on housing which has an interst rate attached to it.
The poor man spends the bulk of his income on things like rent or basic groceries, which are also not sales-taxed.
Don't get me wrong, the sales tax is regressive when you start comparing people with incomes above roughly $80,000 or so. But it isn't much of an issue with incomes around $20,000 because they benefit much more from social programs and redistribution which are funded from taxes in the first place.
quote: The Liberals brought in their own income-tax cuts in the dying days of the Paul Martin government but those were reduced when the Conservatives came to office.
“We are back where we were in 2005 about the income tax. The government increased your income tax,” said Mr. Dion, adding that he supports the corporate tax cut.
But he was unequivocal about the GST.
“It's a mistake. It will not help the productivity of our country, it will not help our families as it should. It's a big mistake,” Mr. Dion said.
During the 2006 election campaign, Stephen Harper made a two percentage point cut to the-then seven per cent GST the top item of his five-point agenda. The rate was dropped to six per cent during the Conservative's first budget. The second instalment was promised before 2011.
Mr. Dion is not alone in his objection to the GST cut. A group of 20 economists surveyed last week by The Globe and Mail were unanimous in their rejection of the Conservative plan as a tax-cutting priority for Canada.
All 20 economists said other tax cuts would be better for the country.
The underscore the point, Liberals were in favour of cutting the income tax while Conservatives raised the income tax to lower the sales tax, which is actually bad for the economy as well as being bad for low-income earners.
Posts: 7593 | Registered: Sep 2006
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posted
Certainly exempting things like food and medicine and provding sales tax credit will help alleviate the inequity but I don't think that is what was originally being advocated for. If you start exempting too many of the basics, the system fails because the rate needed on other items to fund the federal budget becomes exorbitant. Some state sales taxes don't exempt food. I haven't seen an actual proposal for a federal sales tax replacement of the income tax to see what it would look like but I can't imagine one that would not be regressive and squeeze the middle class much more than the upper class.
Posts: 416 | Registered: May 2005
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quote:The poor man at an income of $20,000 would pretty much receive the maximum sales tax credit...
You're assuming that the sales tax credits will be set at a rate low enough to offset the increase, and thus still effectively ensure income redistribution.
To many conservatives in this country, a sales tax appeals precisely because it would not provide a mechanism for income redistribution.
Posts: 37449 | Registered: May 1999
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quote:Originally posted by TomDavidson: ... a sales tax appeals precisely because it would not provide a mechanism for income redistribution.
Maybe American liberals should do something about that rather than lobby against a sales tax. A sales tax (or rather a VAT to be specific) IS the superior solution. It's European even.
On what other issue are you going to get Mal to agree on a liberal European solution? Posts: 7593 | Registered: Sep 2006
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posted
There's no economic malpractice going on here. The reason that Obama hasn't saved the economy is the same reason Bush didn't, and the same reason Presidents never save the economy: Because the fiscal tools available to the President and Congress are not sufficient to fix a recession in the short run. Increased spending is counteracted by the increased taxes required for it. On the flip side, decreasing spending just puts more money in the hands of private businesses unwilling to risk it in hard times. The effects of either policy change takes plenty of time to come into effect - at which point the economy may be at an entirely different point in the economic cycle. And the forces driving recessions, this one in particular, are much larger, more international, and more long-term than any solutions that U.S. politicians on a 2-year election cycle can offer.
The Fed is the institution with significant power over the economy - if there is economic malpractice going on, the Fed is probably the place to lay the blame. But if we are talking about Obama, or the Democrats in congress, or Bush before them, or any other elected politician, then expecting them to save the economy is asking something of them they simply cannot do. They can take credit for a good turn of the economy, or they can take blame for a bad turn, and they can do things that will shape the economy in the long run, but I don't think its fair to expect them to solve economic recessions in the short run.
So, if anything, there is political malpractice going on - Obama promised he could do something that he can't do. But virtually every national politician makes similar claims when it comes to the economy, so I don't see it as reasonable to get more upset at Obama than at anyone else for failing in that regard.
I suspect that eventually the economy will rebound, and Obama will get credit... and he probably won't really deserve that much of it, for the exact same rason.
Posts: 8120 | Registered: Jul 2000
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posted
Government is often given much more credit/blame for the economy than is valid. That said, there are very specific things a president can do to help the economy and right now it starts with spending.
Bush was very anti-conservative (fiscal) during much of his term and spent like a drunken sailor. Obama spends like the drunken sailor who thinks he just won the lottery. Despite all of the complexities that comprise our economy, common sense *really still does apply. When you have no money, stop spending. Until the public starts valuing this basic household budgeting principle higher than federal "programs", we'll continue to get what we pay for.
Posts: 135 | Registered: Apr 2006
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I wonder what some of you think about Calvin Coolidge's Tax cuts. By the end of his administration only the top 2% of wage earners were paying income tax.
Lack of Wall Street regulation aside, he did a pretty good job at cutting government spending. When you don't have as much government spending you don't need as much federal revenue, and when you don't need as much federal revenue you don't need a lot of taxes. Funny how that works.
Posts: 1937 | Registered: Nov 2006
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posted
Cutting spending is obviously a great solution in the abstract. The problem comes into play when you have to identify what to cut. Conservatives seem all about spending cuts in the abstract but I rarely hear them advocate the actual cutting of services or benefits. Personally, I was opposed to the war in Iraq and in a more limited manner the war in Afghanistan. If we had that money back, certainly there would be room for tax cuts. But whats done is done. That money is spent. So what do we cut now? How do politicians sell a service or benefit cut to their constituents? Until we can answer some of these questions it seems like curtailing spending will only be minimally feasible.
Posts: 416 | Registered: May 2005
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quote:Theoretically, gas taxes go towards paying for road repairs, and the only people who pay them are people who drive.
I disagree. The taxes on gas are factored into the price of any good or service you purchase that has to be transported. That's pretty much everything. When gas prices go up everyone pays for it whether you drive or not.
Good point. If I edit "whether you drive" to "whether you use the road" then that fixes it. Anyone who consumes something that was transported by road or rail, which is basically everything, should have to pay a tiny tax to keep up the roads, otherwise, when they fall into disrepair, how else are you going to get your produce from across the country, and crap from China that's trucked or tracked inland? The biggest percentage comes by far from actual drivers, but everyone who profits from it should contribute to the upkeep.
I would be willing to consider a rebate program in a raised gas tax scenario that would pay back some rig drivers, since it's impossible for them, to a degree, to drive really fuel efficient rigs or reduce their driving hours. But it would also be a good push towards building more fuel efficient rigs. I read somewhere the other day that regulators in the Obama administration, in the face of Congressional deadlock, are ready to run wild with various things that Congress will be powerless to stop in their current state. One of those things is CAFE rules which might demand something like 60mph fleet standards in the next 10-15 year, almost doubling the current standard.
If we had put a higher gas tax in place years ago, we'd have reaped hundreds of billions from it, had more fuel efficient cars, would have driven down consumption, would have snatched most of those billions from foreign governments who aren't exactly singing our praises on a regular basis, and we the price today wouldn't be a dime higher than it is. Might even be lower. But presidents are all talk and no action on this issue, and have been for decades.
Posts: 21898 | Registered: Nov 2004
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quote:Originally posted by theresa51282: Cutting spending is obviously a great solution in the abstract. The problem comes into play when you have to identify what to cut. Conservatives seem all about spending cuts in the abstract but I rarely hear them advocate the actual cutting of services or benefits. Personally, I was opposed to the war in Iraq and in a more limited manner the war in Afghanistan. If we had that money back, certainly there would be room for tax cuts. But whats done is done. That money is spent. So what do we cut now? How do politicians sell a service or benefit cut to their constituents? Until we can answer some of these questions it seems like curtailing spending will only be minimally feasible.
Yes, cut's are thrown around generically. Also you are correct in that politicians are all about job security and you get that by promising to give things to people, not take them away. Most politicians know that constituents love hearing that they're going to get stuff, that the government is going to provide this or that. And many constituents consciously or unconsciously ignore the fact that the government can't actually give, or in fact produce anything. On the whole, government consumes and we the people produce.
The grand question of course is to what degree do we want the government to consume and distribute what we collectively produce?
As far as specifics, I'd eliminate some fed departments altogether. Dept. of education, gone. Dept. of agriculture, gone. These should be state run entities, not federal.
Posts: 135 | Registered: Apr 2006
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quote:Originally posted by ScottF: Bush was very anti-conservative (fiscal) during much of his term and spent like a drunken sailor.
Other than medicare plan d and the (popular in conservative circles) various wars, what are you thinking of here?
quote: Despite all of the complexities that comprise our economy, common sense *really still does apply. When you have no money, stop spending. Until the public starts valuing this basic household budgeting principle higher than federal "programs", we'll continue to get what we pay for.
What do you see as the problem with the economy? If something is not done about government debt then down the road, no doubt, there will be big problems. Currently, however, the bond markets are favorable i.e. the government is being lent money at extremely low rates. The big problem is currently unemployment, which will not be helped by a reduction in government spending.
Posts: 644 | Registered: Sep 2008
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As far as specifics, I'd eliminate some fed departments altogether. Dept. of education, gone. Dept. of agriculture, gone. These should be state run entities, not federal. [/QB]
Transferring the administrative responsibility from the feds to the states does not necessarily mean that there is any reduction in cost. An estimated % savings from any cut would also be useful.
Posts: 644 | Registered: Sep 2008
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posted
mystic, Government spending increased massively under President Bush. It was close to double that under President Clinton. Even excluding war spending, there was a enormous increase in government spending.
I thought this is common knowledge. Are you unaware of this?
Posts: 10177 | Registered: Apr 2001
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quote:Originally posted by MrSquicky: mystic, Government spending increased massively under President Bush. It was close to double that under President Clinton. Even excluding war spending, there was a enormous increase in government spending.
I thought this is common knowledge. Are you unaware of this?
I was unaware. On what?
Posts: 644 | Registered: Sep 2008
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quote:Originally posted by ScottF: Bush was very anti-conservative (fiscal) during much of his term and spent like a drunken sailor.
Other than medicare plan d and the (popular in conservative circles) various wars, what are you thinking of here?
quote: Despite all of the complexities that comprise our economy, common sense *really still does apply. When you have no money, stop spending. Until the public starts valuing this basic household budgeting principle higher than federal "programs", we'll continue to get what we pay for.
What do you see as the problem with the economy? If something is not done about government debt then down the road, no doubt, there will be big problems. Currently, however, the bond markets are favorable i.e. the government is being lent money at extremely low rates. The big problem is currently unemployment, which will not be helped by a reduction in government spending.
You answer your own question above. Cheap money is not an indication of economic health. We can't "borrow" our way out of this cycle.
If the feds continue to borrow and spend as they have been (and there's no indication they are slowing anytime soon) then a continued downward spiral is virtually guaranteed.
edit: as far as Bush spending goes, he passed pretty much everything put in front of him. He also signed off on the original TARP which I believe was a mistake.
Posts: 135 | Registered: Apr 2006
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posted
Pretty much everything. Entitlements, anti-terrorism pending, domestic spending, earmarks like the over $300 million "Bridge to Nowhere" in Alaska, etc.
The Republican led Congress were pouring money out like crazy and he did nothing to stop them as well as getting a great deal of spending on many of his projects. One of the things that they did cut was regulation and oversight, which several investigations have shown ended up with many of the programs being very wasteful with the money they got.
Here's a piece by the Washington Post. You'll get other detailed views by googling "government spending during Bush" or something similar.
Posts: 10177 | Registered: Apr 2001
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As far as specifics, I'd eliminate some fed departments altogether. Dept. of education, gone. Dept. of agriculture, gone. These should be state run entities, not federal.
Transferring the administrative responsibility from the feds to the states does not necessarily mean that there is any reduction in cost. An estimated % savings from any cut would also be useful. [/QB]
Having budgets and decisions occur locally would provide dramatic savings, beyond removing the bureaucratic blubber and waste that drips from those (and most other) departments in Washington.
I estimate the savings to be approximately 46.332%. You asked.
Posts: 135 | Registered: Apr 2006
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As far as specifics, I'd eliminate some fed departments altogether. Dept. of education, gone. Dept. of agriculture, gone. These should be state run entities, not federal.
Transferring the administrative responsibility from the feds to the states does not necessarily mean that there is any reduction in cost. An estimated % savings from any cut would also be useful.
Having budgets and decisions occur locally would provide dramatic savings, beyond removing the bureaucratic blubber and waste that drips from those (and most other) departments in Washington. [/QB]
This is all hand waving you realize.
Posts: 644 | Registered: Sep 2008
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quote:Originally posted by MrSquicky: Pretty much everything. Entitlements, anti-terrorism pending, domestic spending, earmarks like the over $300 million "Bridge to Nowhere" in Alaska, etc.
The Republican led Congress were pouring money out like crazy and he did nothing to stop them as well as getting a great deal of spending on many of his projects. One of the things that they did cut was regulation and oversight, which several investigations have shown ended up with many of the programs being very wasteful with the money they got.
You'll get a more detailed view by googling "government spending during Bush" or something similar.
I did a quick look and found that you're correct. However, it was very hard to find out what the money was actually spent on. I had remembered the various egregious examples of pork, but thought that this still only represented a small percent.
Posts: 644 | Registered: Sep 2008
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quote:Originally posted by ScottF: Cheap money is not an indication of economic health. We can't "borrow" our way out of this cycle.
If the feds continue to borrow and spend as they have been (and there's no indication they are slowing anytime soon) then a continued downward spiral is virtually guaranteed.
edit: as far as Bush spending goes, he passed pretty much everything put in front of him. He also signed off on the original TARP which I believe was a mistake.
My 30 second take is the following: demand is low. Many companies are sitting on cash rather than hiring new workers or investing in new technologies (fact) because their existing capacity is not being fully utilized so there is no reason to do so (opinion). The government can maintain the status quo and leave unemployment at ~10%; it can cut spending and lay off more workers and depress demand further OR it can increase spending in a way that is unsustainable for the long term, but in the short term reduces misery by employing the unemployed, and hopefully bumps demand sufficiently that companies need to increase their capacity and hiring increases.
Please explain why you disagree, but do so with arguments rather than conclusory statements. I've tried to delineate between my opinion and facts on the ground.
Posts: 644 | Registered: Sep 2008
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quote:Originally posted by MrSquicky: To be fair, President Bush was only a part of this. The Republican Congress was an even bigger part.
And, to be honest, it's really depressing/infuriating that this is apparently not well known.
It wasn't? I thought it was one of the reasons Republicans lost so many seats in 2006 and 2008 was because people were catching on.
Posts: 1937 | Registered: Nov 2006
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natural_mystic: while a true increase in demand would be nice, the government has 'created' demand stimulus several times so far (tax rebates, numerous tax credits for vehicles and homes et cetera). Companies have enjoyed them while they lasted, but have not made major investments, because once the demand shock went away, demand went right back down. And any demand stimulus big enough to possibly avoid that problem would, I think, also be prohibitively large.
I think government should first focus on reducing regulatory uncertainty that exists regarding a number of financial matters (I don't care much how they do it, though it does matter -- but mostly they need to make firm versions of all those rules they just mandated!)
That will make companies more certain that money they spend won't end up harming them.
Also, the government should try to reduce trade barriers to getting US goods into other countries. It'd be good to lower barriers to allow goods to enter the US more cheaply, too, though I think the only way that is happening politically is as a carrot to get other countries to lower their trade restrictions. Given the increasing buying power of parts of Asia and Africa, plus Australia, making it easier to put US goods in their hands is a credible way for the government to persuade companies total demand for their products will increase long term. As companies expand, I anticipate more workers, with more free money, boosting America's own consumption again some.
Further, encouraging consumption with free money is, to some extent, bizarre given the symptoms of the crisis. Additional spending, especially in the areas that are easiest to prompt (housing, cars), is not a good thing unless there is sufficient income to support it (note: this does not mean that people must always save, just that debt needs to be managed judiciously).
Posts: 15770 | Registered: Dec 2001
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quote:Originally posted by MrSquicky: To be fair, President Bush was only a part of this. The Republican Congress was an even bigger part.
And, to be honest, it's really depressing/infuriating that this is apparently not well known.
It wasn't? I thought it was one of the reasons Republicans lost so many seats in 2006 and 2008 was because people were catching on.
Wasn't there a study recently were most people who thought the original stimulus package was a mistake also said it was passed under Obama's administration (when in fact it was passed under Bush)? Somewhat depressing study on the stupidity of ...people Posts: 2223 | Registered: Mar 2008
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@fugu, I would advocate increasing demand by increasing employment. I agree, not the most efficient way to increase demand, but, given current employment figures, if you generate X jobs but demand does not rise, at least X jobs have been created. Any such approach is something of a stop-gap measure until, hopefully, things pick up. These stop-gap measures are valuable however - people out of the work force for too long often never rejoin it, and a temporary job at least cuts the bouts of unemployment saving some from this fate. And, while employed, they are likely to spend a large proportion of this money. As far as what will getting companies with cash to start investing, I suspect, with every quarter of GDP growth, the likelihood of them spending increases, so these stop gap measures are a way of limiting misery until this happens.
I agree that clearing up regulatory uncertainty would be good (although I find this a far less compelling reason for why companies are not spending than the low aggregate demand). An idea that has been thrown around is the Fed committing to a higher inflation target. I hope that is seriously considered.
No one is ever going to argue against increasing exports. I'm not au fait enough with trade law to have an opinion on whether this is doable. The yuan is going to make China a difficult market for a while to come, however.
Addressing your last paragraph, as I said above I'm not in favor of simply giving people tax credits on goods. I would certainly not advocate putting more money into the auto or housing industry (except to avoid a meltdown). The pre-crash "normals" were symptoms of the bubble, so a return to them is somewhat futile. But, after 2-3 years of de-leveraging, the public might be getting ready to start spending again.
Posts: 644 | Registered: Sep 2008
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quote:Originally posted by MrSquicky: To be fair, President Bush was only a part of this. The Republican Congress was an even bigger part.
And, to be honest, it's really depressing/infuriating that this is apparently not well known.
I have read up to page 9 of the article (Washington Times by the way), and the examples have chiefly been about the department of homeland security.
Getting back to the original claim that Bush was anti-conservative: It is not a priori clear to me that the construction of the DHS is an anti-conservative issue. And I don't think that you can directly attribute the waste and inefficiency to anything Bush did. The main anti-conservative thing that Bush did was Medicare-Part D (truly ridiculous legislation), and that was basically to buy the senior vote for '04.
Posts: 644 | Registered: Sep 2008
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quote:Theoretically, gas taxes go towards paying for road repairs, and the only people who pay them are people who drive.
I disagree. The taxes on gas are factored into the price of any good or service you purchase that has to be transported. That's pretty much everything. When gas prices go up everyone pays for it whether you drive or not.
One might say you're indirectly paying a tax on something you're indirectly doing. That is, someone else is paying the user fee for driving and passing the cost of it on to you when you buy the thing they transported.
My only problem with gas taxes is they get looted into the general fund and don't stick with building and maintaining the roads.
...
A big reason the 'pubs lost so many seats in '06 was the endless drumbeat against the war. It demoralized many conservatives. The dems got into power and tanked the economy paving the way for Obama and more Dem seats.
Unfortunately, the Dems keep doing what they're doing because they really are Keynesians. Thus, they take capital from one and give it to another thinking that's a net gain and will grow the economy. Obviously it doesn't.
Bush was this stupid too, for the record, he just used a smaller dump truck of other people's money.
Posts: 7085 | Registered: Apr 2001
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quote:Originally posted by natural_mystic: My 30 second take is the following: demand is low. Many companies are sitting on cash rather than hiring new workers or investing in new technologies (fact) because their existing capacity is not being fully utilized so there is no reason to do so (opinion). The government can maintain the status quo and leave unemployment at ~10%; it can cut spending and lay off more workers and depress demand further OR it can increase spending in a way that is unsustainable for the long term, but in the short term reduces misery by employing the unemployed, and hopefully bumps demand sufficiently that companies need to increase their capacity and hiring increases.
Please explain why you disagree, but do so with arguments rather than conclusory statements. I've tried to delineate between my opinion and facts on the ground.
You're saying the government can either maintain the status quo or borrow even more money. I reject those as the only two options. I know you're stating your opinion, but to put it more bluntly than fugu13 mentions above, it just ain't working. Any time a program's results need to be described in terms like "lives touched" you know you're in trouble.
The two arguments for more federal debt seem to be "we just haven't spent enough!" or "you should see the mess we'd be in if we hadn't done it". I don't subscribe to either of these. And yes, that gets back to my cuts,cuts,cuts mantra.
Here's my argument, hopefully without any ~conclusory statements: I believe that while there are some areas that need federal regulation, the US economy functions best when the government interferes least. I do not trust the federal government to "fix" the economy because I believe that most of the people making these decisions are highly unqualified. I think if corporations saw a clear indication that government was going to stop increasing spending and try and get their own financial house in order, it might just give them some confidence in moving forward themselves.
edit: I didn't see you had "cut spending" as an option there, sorry about that. But then you say "and lay off more workers". But because the federal gov. is expanding greatly, it's one of the few places where employment is consistently up, so I'm not sure where the "more" comes in.
Posts: 135 | Registered: Apr 2006
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quote:Originally posted by MrSquicky: To be fair, President Bush was only a part of this. The Republican Congress was an even bigger part.
And, to be honest, it's really depressing/infuriating that this is apparently not well known.
It wasn't? I thought it was one of the reasons Republicans lost so many seats in 2006 and 2008 was because people were catching on.
Wasn't there a study recently were most people who thought the original stimulus package was a mistake also said it was passed under Obama's administration (when in fact it was passed under Bush)? Somewhat depressing study on the stupidity of ...people
I think you're thinking of TARP. Posts: 2907 | Registered: Nov 2005
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I am very pregnant- I don't have to be right on anything that I am doing from memory. And yes, I have had some very emberassing moments this week as I have called my daughter's friends by the wrong names and forgotten who I talked to about what. Posts: 2223 | Registered: Mar 2008
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