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Tax Cuts and Deficits

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  • #16
    Originally posted by carpedm9587 View Post
    Block grants with appropriate safeguards would level funding across states by population (rather than having disproportionately resources based on the wealth of the state), while ensuring local control of programs so they can be tailored to meet local needs. I have long advocated for such a system - but the current model is seriously flawed.
    We may disagree on the solution, but I will not dispute that it's seriously flawed.
    Some may call me foolish, and some may call me odd
    But I'd rather be a fool in the eyes of man
    Than a fool in the eyes of God


    From "Fools Gold" by Petra

    Comment


    • #17
      Originally posted by carpedm9587 View Post
      Agreed. Indeed - it would seem to me fairly obvious that the people who create situations like the shutdown should also be impacted by the results. Congress and the Executive branch should see salaries stop until the impasse is resolved.

      Unfortunately, that would be an unbalanced result with this president. As best we can tell, he and his family receive FAR more income from the various ways that they are benefiting from this role as president than he is receiving as salary. Indeed, I believe he made the show of reducing his salary to $1 per year. What a grand gesture. Give up $400K and then reap potentially millions in business gains. So much for the "pay to play" fuss made during the election. I sincerely hope the Democrats take that mantra up for 2020. Trump has taken "pay to play" to all new levels.

      As a consequence - shutting down salary for Congress would incent one side to compromise - while doing nothing to incent the other side of the dispute.
      I don't think you should just pick on the President - many members of Congress are FAR richer than their 'government salaries' would provide, and if their government pay were cut, they would hardly feel a thing.

      I think this goes back to term limits - when you hear such expressions as "powerful member of the ways and means committee", the power comes from their entrenchment in the system.
      The first to state his case seems right until another comes and cross-examines him.

      Comment


      • #18
        Originally posted by Cow Poke View Post
        I don't think you should just pick on the President - many members of Congress are FAR richer than their 'government salaries' would provide, and if their government pay were cut, they would hardly feel a thing.
        Agreed - but the degree to which Trump is doing this dwarfs anything a Senator or Representative could do - and few Senators/Representatives have businesses that are directly being enriched because of their political position. That is not to say that I am blind to the existence of money and corruption in government - but Trump's engagement in it is off the charts.

        Originally posted by Cow Poke View Post
        I think this goes back to term limits - when you hear such expressions as "powerful member of the ways and means committee", the power comes from their entrenchment in the system.
        On this we agree. If I had my way, Senators would be limited to 2 terms, and representatives to 6. Those numbers would ensure that congress always has a combination of "corporate memory" and "new blood." But that ALSO requires the people in those seats to vote for such legislation, so (again) - Catch-22. The only way this will change is if "we the people" collectively vote people into office that will prioritize these issues.

        I have to admit I have come to believe that, although it is possible, I doubt I will see it in my lifetime. Perhaps the next generation will be smarter.
        The ultimate weakness of violence is that it is a descending spiral begetting the very thing it seeks to destroy...returning violence for violence multiplies violence, adding deeper darkness to a night already devoid of stars. Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that. Martin Luther King

        I would unite with anybody to do right and with nobody to do wrong. Frederick Douglas

        Comment


        • #19
          Originally posted by Mountain Man View Post
          We may disagree on the solution, but I will not dispute that it's seriously flawed.
          I find that most political differences are about the how - not the what...
          The ultimate weakness of violence is that it is a descending spiral begetting the very thing it seeks to destroy...returning violence for violence multiplies violence, adding deeper darkness to a night already devoid of stars. Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that. Martin Luther King

          I would unite with anybody to do right and with nobody to do wrong. Frederick Douglas

          Comment


          • #20
            Originally posted by Cow Poke View Post
            I don't think you should just pick on the President - many members of Congress are FAR richer than their 'government salaries' would provide, and if their government pay were cut, they would hardly feel a thing.

            I think this goes back to term limits - when you hear such expressions as "powerful member of the ways and means committee", the power comes from their entrenchment in the system.
            It's the politicians that start out in office in the upper middle class but leave multi-millionaires that have always concerned me.

            I'm always still in trouble again

            "You're by far the worst poster on TWeb" and "TWeb's biggest liar" --starlight (the guy who says Stalin was a right-winger)
            "Overall I would rate the withdrawal from Afghanistan as by far the best thing Biden's done" --Starlight
            "Of course, human life begins at fertilization that’s not the argument." --Tassman

            Comment


            • #21
              Originally posted by Cow Poke View Post
              I work with our city and county officials quite a bit, and I think they try to be much more responsible than our federal leaders --- I think the more 'local' the control is, the better the results can be.
              As a general rule federal solutions tend to be cookie cutter or one size fits all in nature whereas when it is more at the local level they have a far better understand just what their problems are and likely know better how to handle them.

              I'm always still in trouble again

              "You're by far the worst poster on TWeb" and "TWeb's biggest liar" --starlight (the guy who says Stalin was a right-winger)
              "Overall I would rate the withdrawal from Afghanistan as by far the best thing Biden's done" --Starlight
              "Of course, human life begins at fertilization that’s not the argument." --Tassman

              Comment


              • #22
                Originally posted by carpedm9587 View Post
                Yes it does. When Democrats are in power - expenditures tend to climb, and taxes with them. When Republicans are in power, taxes tend to drop, but expenditures tend to continue to climb. It appears that the only party that actually cares about the deficit is whichever party is not currently in power.
                Often tax cuts have still led to revenue growth since the money is frequently used to expand businesses and the like causing the economy to grow. For instance after the 1981 tax cuts tax revenue was higher than in previous years. And after the Trump tax cut this year for the first half of 2018 tax revenue had increased by something like 1% over 2017. The problem as always is that government keeps spending more than they ever take in.

                I'm always still in trouble again

                "You're by far the worst poster on TWeb" and "TWeb's biggest liar" --starlight (the guy who says Stalin was a right-winger)
                "Overall I would rate the withdrawal from Afghanistan as by far the best thing Biden's done" --Starlight
                "Of course, human life begins at fertilization that’s not the argument." --Tassman

                Comment


                • #23
                  Originally posted by rogue06 View Post
                  It's the politicians that start out in office in the upper middle class but leave multi-millionaires that have always concerned me.
                  Obama and the Clintons are two perfect examples.
                  Some may call me foolish, and some may call me odd
                  But I'd rather be a fool in the eyes of man
                  Than a fool in the eyes of God


                  From "Fools Gold" by Petra

                  Comment


                  • #24
                    Originally posted by rogue06 View Post
                    It's the politicians that start out in office in the upper middle class but leave multi-millionaires that have always concerned me.
                    These days, about the only you can get into office is to be a multi-millionaire, or be owned by one or two.
                    The first to state his case seems right until another comes and cross-examines him.

                    Comment


                    • #25
                      Originally posted by rogue06 View Post
                      As a general rule federal solutions tend to be cookie cutter or one size fits all in nature whereas when it is more at the local level they have a far better understand just what their problems are and likely know better how to handle them.
                      I think one of the best (worst) examples of this is public education.
                      The first to state his case seems right until another comes and cross-examines him.

                      Comment


                      • #26
                        Originally posted by rogue06 View Post
                        Often tax cuts have still led to revenue growth since the money is frequently used to expand businesses and the like causing the economy to grow. For instance after the 1981 tax cuts tax revenue was higher than in previous years. And after the Trump tax cut this year for the first half of 2018 tax revenue had increased by something like 1% over 2017. The problem as always is that government keeps spending more than they ever take in.
                        This is an often bandied about trope, but it simply is not supported by the facts. When such numbers are cited (usually including the cuts of Coolidge and Kennedy), they tend to play fast and lose with cause and effect. For example, Reagan raised taxes 11 times in his presidency, including a major one the following year (1982).

                        What has happened with the Trump tax cuts is pretty much what most economists predicted: big companies used the money to buy back stock and pay down debt, rewarding their owners and investors. The idea that a company would use these tax savings to expand jobs ignores a basic fundamental of business: the last thing a business wants to do is hire. Hiring takes on cost, and payroll represents the largest outlay of most businesses. A well-managed business will do everything it can to avoid adding positions, until the growth in that business leaves it with no choice but to add positions. That is why productivity is such a major part of the equation, and it is why so many businesses are putting so much effort into automation.

                        Yes, most people saw some benefit from the Trump tax cuts. But while the lower classes walked away with a few extra dollars in their paycheck, and the middle class congratulated itself on an extra $1-2K per year, the top 5% of the country made out like bandits, hauling in tens and hundreds of thousands (and in some cases - millions) of dollars virtually overnight. Trump and his cronies did what most of us in the middle and on the left expected: enriched himself while dropping a few crumbs to the rest of the population.
                        The ultimate weakness of violence is that it is a descending spiral begetting the very thing it seeks to destroy...returning violence for violence multiplies violence, adding deeper darkness to a night already devoid of stars. Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that. Martin Luther King

                        I would unite with anybody to do right and with nobody to do wrong. Frederick Douglas

                        Comment


                        • #27
                          Originally posted by carpedm9587 View Post
                          This is an often bandied about trope, but it simply is not supported by the facts. When such numbers are cited (usually including the cuts of Coolidge and Kennedy), they tend to play fast and lose with cause and effect. For example, Reagan raised taxes 11 times in his presidency, including a major one the following year (1982).
                          "Reagan raised taxes 11 times" is another popular trope, often delivered without context. As the saying goes, "Not all taxes are created equal."

                          https://dailycaller.com/2012/06/06/r...he-real-story/
                          Some may call me foolish, and some may call me odd
                          But I'd rather be a fool in the eyes of man
                          Than a fool in the eyes of God


                          From "Fools Gold" by Petra

                          Comment


                          • #28
                            Originally posted by carpedm9587 View Post
                            This is an often bandied about trope, but it simply is not supported by the facts. When such numbers are cited (usually including the cuts of Coolidge and Kennedy), they tend to play fast and lose with cause and effect. For example, Reagan raised taxes 11 times in his presidency, including a major one the following year (1982).
                            Indeed sources that despise the idea of people knowing better how to spend their own money than an all-knowing Nanny State does will shade the truth. They will insist that things like marked economic expansion, wage growth and the like that typically follow tax cuts are mere coincidences.

                            Originally posted by carpedm9587 View Post
                            What has happened with the Trump tax cuts is pretty much what most economists predicted: big companies used the money to buy back stock and pay down debt, rewarding their owners and investors. The idea that a company would use these tax savings to expand jobs ignores a basic fundamental of business: the last thing a business wants to do is hire. Hiring takes on cost, and payroll represents the largest outlay of most businesses. A well-managed business will do everything it can to avoid adding positions, until the growth in that business leaves it with no choice but to add positions. That is why productivity is such a major part of the equation, and it is why so many businesses are putting so much effort into automation.
                            The one thing most businesses want to do is expand -- to grow bigger. That is not an easy thing to do without expanding your employee base. Now that the economy is generally experiencing marked improvement we are presently experiencing shortages in the labor market. There are more positions available than there people to fill them -- and not just in high skilled areas but in unskilled areas as well. This naturally gives rise to competition for employees to fill those positions with employers offering better pay, increased benefits and more company perks to attract them. Those that don't experience a drain of employees to those companies that do.

                            Originally posted by carpedm9587 View Post
                            Yes, most people saw some benefit from the Trump tax cuts. But while the lower classes walked away with a few extra dollars in their paycheck, and the middle class congratulated itself on an extra $1-2K per year, the top 5% of the country made out like bandits, hauling in tens and hundreds of thousands (and in some cases - millions) of dollars virtually overnight. Trump and his cronies did what most of us in the middle and on the left expected: enriched himself while dropping a few crumbs to the rest of the population.
                            Of course those that pay the lion's share of taxes are going to see the biggest benefits[1] and those that pay little or no taxes (or get back more than they paid in) won't get much in a tax refund.




                            1. For instance the top 1% paid 39.48% of income taxes and the top 5% paid 59.97%

                            I'm always still in trouble again

                            "You're by far the worst poster on TWeb" and "TWeb's biggest liar" --starlight (the guy who says Stalin was a right-winger)
                            "Overall I would rate the withdrawal from Afghanistan as by far the best thing Biden's done" --Starlight
                            "Of course, human life begins at fertilization that’s not the argument." --Tassman

                            Comment


                            • #29
                              Originally posted by rogue06 View Post
                              Indeed sources that despise the idea of people knowing better how to spend their own money than an all-knowing Nanny State does will shade the truth. They will insist that things like marked economic expansion, wage growth and the like that typically follow tax cuts are mere coincidences.
                              Why don't we skip the partisan hyperbole - and just stay with the data, OK?

                              Originally posted by rogue06 View Post
                              The one thing most businesses want to do is expand -- to grow bigger. That is not an easy thing to do without expanding your employee base. Now that the economy is generally experiencing marked improvement we are presently experiencing shortages in the labor market. There are more positions available than there people to fill them -- and not just in high skilled areas but in unskilled areas as well. This naturally gives rise to competition for employees to fill those positions with employers offering better pay, increased benefits and more company perks to attract them. Those that don't experience a drain of employees to those companies that do.
                              Yes - businesses want to grow. Indeed, economically it is "grow or perish." But businesses do not hire employees to grow their business - they hire employees because their business is growing. This is the basic business fact that Trump's claims completely ignored. No business says, "wow - I want to grow - let me hire some more people so I can do that." Instead, a business projects its growth curve based on a variety of data, and then staffs to meet it - hiring only as much as they absolutely have to. Trump and the Republican put out the fiction that, with a glut of new cash, businesses would grow and hire. Business 101 says "that's not how it works." Having more money can help a business capitalize growth without having to incur debt - but it doesn't MAKE a business grow. Growth happens organically, or by M&A. This was the fiction Trump (et al) sold, and so many bought into - and the facts show that what economist predicted is exactly what is and has happened: the tax cuts acted like a shot of nitrous to the economy - giving it a short-term boost. But a small fraction of the freed up money went to increased salaries and raises. The bulk went to stock buy backs and debt reduction. Another small sliver went to bonuses - because businesses know a bonus is a one-time cost but a salary increase is an ongoing expense.

                              Originally posted by rogue06 View Post
                              Of course those that pay the lion's share of taxes are going to see the biggest benefits[1] and those that pay little or no taxes (or get back more than they paid in) won't get much in a tax refund.
                              And in an economy that already has one of the greatest income disparities we have ever known, further enriching the top 5% is simply not warranted. All it has successfully done is further widen the income disparity gap.

                              Originally posted by rogue06 View Post
                              I have never questioned that the top pay more - which is as it should be. I have long advocated for a simple flat tax: a solitary (high) deduction that omits from taxation the basic cost of living for an individual (or family up to four), and a flat tax on everything above that number. That tax rate should be set to provide adequate revenues to have a balanced budget, so it should be adjusted annually to match expenditures.
                              The ultimate weakness of violence is that it is a descending spiral begetting the very thing it seeks to destroy...returning violence for violence multiplies violence, adding deeper darkness to a night already devoid of stars. Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that. Martin Luther King

                              I would unite with anybody to do right and with nobody to do wrong. Frederick Douglas

                              Comment


                              • #30
                                Originally posted by Mountain Man View Post
                                "Reagan raised taxes 11 times" is another popular trope, often delivered without context. As the saying goes, "Not all taxes are created equal."

                                https://dailycaller.com/2012/06/06/r...he-real-story/
                                Of course they aren't. Seven of the 11 were considered fairly minor increases. Four of them, however, were major tax increases - including 1982, 1983, 1984, and 1987.

                                Creating a causal line between the 1981 tax cut and the subsequent shift in the economy and tax revenues is, at the very best, a significant stretch.

                                Note that does not mean I think you stimulate the economy by hiking taxes However, the Fed has more impact on the economy with its adjustment of interest rates than can be attributed to pretty much any tax cut. Tax cuts generally have a short-term positive impact - and a long term negative one. We have example after example of this in operation - at the loca, state, and federal levels.
                                The ultimate weakness of violence is that it is a descending spiral begetting the very thing it seeks to destroy...returning violence for violence multiplies violence, adding deeper darkness to a night already devoid of stars. Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that. Martin Luther King

                                I would unite with anybody to do right and with nobody to do wrong. Frederick Douglas

                                Comment

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