At Ask Me Help Desk you can ask questions in any topic and have them
answered for free by our experts. To ask questions or participate in
answering them you must register for a free account. By registering you
will be able to:
Get free answers from experts in any of our 300+
topics.
Why worry about spending; all the Republicans need do is cut taxes again to pay for it. The supply-side argument that Republicans make that tax-rate cuts pay for themselves; that, after cutting taxes, the government actually ends up with more revenue—Right?
I suppose that is how Mr. Bush has justified the biggest expansion in government spending since his fellow Texan, Lyndon Johnson.
I suppose that is why giving “the movement” what it wants: the invasion of Iraq for the neoconservatives who wanted it long before 9/11 and tax cuts for business while spending went through the ceiling…betraying conservatism's core principle: that government is the problem rather than the solution.
Deficits are not the boogy man they are made out to be. We can easily live with them and prosper ;but it is better to shrink the size of the Federal Budget wherever possible.
Well not for you 'cause you'll be long dead before the prosperity begins to decline.
WASHINGTON (Reuters) - The U.S. wars in Iraq and Afghanistan could cost taxpayers a total of $2.4 trillion by 2017 when counting the huge interest costs because combat is being financed with borrowed money, according to a study released on Wednesday.
With President George W. Bush indicating a large contingent of U.S. troops likely will be engaged in Iraq and Afghanistan for many years to come, the nonpartisan Congressional Budget Office estimated the total tab for the wars from 2001 through 2017.
CBO estimated that interest costs alone from 2001-2017 could total more than $700 billion.
So far, Congress has given Bush $604 billion for the two wars, with about $412 billion spent in Iraq, according to CBO, which is Congress' in-house budget analyst. In Iraq alone, the United States is spending about $11 billion a month, with costs escalating.
"To put it all on our credit cards with no accountability, with no plan to pay for it, I think is the height of irresponsibility," said Rep. James McGovern, a Massachusetts Democrat who serves on the budget panel and is an outspoken war critic. "It will be just one more toxic legacy of this disastrous war we will have to leave our kids to clean up."
I wonder how big that number would be when you to war with Iran...
I wonder who owns all that debt....
That is spit in the ocean compared to the fixed entitlement obligation coming at us which for some strange reason both parties think are untouchable and both parties work to expand.
The truth is that only 45% of the increase in spending has been defense and 9-11 related .Non-defense spending has increased 55% in that same time. During WWII non defense spending decreased by 11% . Truman signed budgets during the Korean War that reduced non-defense spending by 6 percent .
The truth is that currently only 4% of U.S. gross domestic product is spent for all military related issues . Historically, that level is far more in line with peacetime military spending. By comparison the defense budget under Clinton was 3% share of GDP from 1999-2001 and that was a postwar World War II low.
You got it. In actuality, trickle down economics has been totally discredited. When the government cuts taxes, what happens is what you think happens. Yup, the government takes in LESS money. Whoda thunk that?? Republicans do, with their voodoo economics. Bwa ha ha ha.
excon
“Voodoo” is right…any simple housewife who handles the budget can see there is no “Free Lunch”.
The Economist magazine recently wrote, in response to the comment by Mr. Bush that, “tax cuts pay for themselves”: “Even by the standards of political boosterism, this is extraordinary. No serious economist believes Mr. Bush’s tax cuts will pay for themselves”.
“The President’s own Council of Economic Advisors concluded in its Economic Report of the President, 2003, that, “although the economy grows in response to tax reductions (because of the higher consumption in the short run and improved incentives in the long run) it is unlikely to grow so much that lost revenue is completely recovered by the higher level of economic activity.” The CEA chair at the time was conservative economist Glenn Hubbard.”
Council of Economic Advisors, Economic Report of the President, February 2003, pp. 57-58.
Here's a dirty little secret however . Deficits are not the boogy man they are made out to be. We can easily live with them and prosper ;but it is better to shrink the size of the Federal Budget wherever possible.
"...The idea that tax cuts can spur sufficient economic growth to pay for themselves sounds too good to be true because it is too good to be true. In tax policy, as in other aspects of policymaking, there is no “free lunch.”
"If deficit-financed tax cuts weaken economic growth, their long-run cost could be greater than conventional revenue estimates suggest, because they will reduce revenues not only directly (by lowering people’s tax bills) but also indirectly (by slowing the economy). A recent CBO study of the economic effects of a hypothetical 10 percent across-the-board cut in income tax rates found that under certain assumptions, the increased deficits resulting from the tax cut would be enough of a drag on the economy that the tax cut actually would lose more revenue than if one assumed it had no effect on the economy. In other words, deficit-financed tax cuts could be even more expensive than officially “scored,” rather than less expensive or costless."
The way out of the problem Bush has caused is to let the dollar weaken. That way everybody pays for it. They did, and we are.
excon
PS> Gold, silver, oil and most of the commodities are at record highs. Dollars are equal to the loon. We're in DEEP doo doo. The inflation of the 70's was only a precursor to the inflation that's just getting underway.
I wonder when wages will get on board. Of course, the wages of CEO’s are inflated soo much that there isn’t room for the average worker.
You got it. In actuality, trickle down economics has been totally discredited. When the government cuts taxes, what happens is what you think happens. Yup, the government takes in LESS money. Whoda thunk that?? Republicans do, with their voodoo economics. Bwa ha ha ha.
excon
Excon,
Let's take an actual look at the numbers, shall we?
From the Historical Tables of the United States Budget for 2008.
In 1981, Reagan passed ERTA, his first tax cut. In 1986, he passed the Joint Tax Reliefe Act, his second tax cut. The result was a 60% increase in government income during the 8 years of the Reagan era.
In 2001 Bush passed his first tax cut, EGTRR. In 2003 he passed his second tax cut, JGTR. The increase in government income since 2003 has been 32%. Prior to that we were suffering from the recession caused by 9/11. 2003 was the year we saw the turnaround from that recession... a turnaround that only happened as quickly as it did because of the tax cuts.
In both cases, Bush and Reagan, the economy was suffering from stagflation and recession. In both cases, the tax cuts resulted in a reversal of the recession, an end to the stagflation, increased GDP and overall sound economic improvement.
Incidentally, the same was true when Calvin Coolidge cut taxes in the 1920s and when JFK did it in the 60s. The result was increased government revenue, an improved economy and and decreased unemployment. This has happened EVERY TIME we have seen tax cuts. Not just once or twice, but every time.
So... can you name a single time that tax cuts have resulted in a decrease in revenue for the government? On what basis do you claim that tax cuts result in a decrease in government income? It simply isn't true, as the numbers above prove.
Hay….the proposition is “that tax-rate cuts pay for themselves” and not all these strawmen. Now logically if this is true and you follow to its end there would be no need at all for taxes.
EDIT: Bush is a simple minded idiot for saying this.
From my point of view, DC, there isn't. The government, by Contitutional authority, only has the right to impose taxes for 3 purposes: maintaining a military/police force, maintaining highways, and maintaining the mail service. (It can be argued that they could tax us to maintain the infrastructure necessary for electricity and for telecommunications, as these are essentially expansions of "roadways" and "mail systems".) No other taxes are Constitutionally authorized. Ergo, taxes shopuld only cover those three items, which would mean that our tax bills should be much lower than it is. Roughly 67% lower than it is, according to the 2007 budget.
So yes, I agree that there should be no real need for any taxes at all... or almost none.
However, the government does need to take in SOME form of income in order to maintain the items I discussed above. But the Laffer Curve clearly shows that after a certain point, raising taxes results in lower income for the government because more taxes means fewer jobs, lower incomes and thus fewer people paying lower levels of taxes despite the tax rate hikes. The Laffer Curve also shows that lowering taxes results in increased employment, increased productivity, increased income and thus increased income taxes for the government.
So yes, the tax cuts essentially pay for themselves... not if taxes are eliminated completely, because the government still needs some form of income. But if an equilibrium between productivity, revenues, and taxation is reached, government income, productivity and personal incomes all reach their highest efficiency. THAT is when the tax cuts pay for themselves. And this fact has been born out through history, as well as in theory. We've seen it at least 6 times in the past century.
Linear Mode
