Hello:

They SAY that if the Bush tax cuts are extended to the richest people amongst us, they'll create jobs. They certainly might. I don't know. But, we don't have to guess. Instead of just giving them a tax break and HOPE they'll do the right thing, why don't we give them a tax break WHEN they create the jobs?

I'd go for that. You? Remember when we gave the banks money and HOPED they start lending? We got snookered on that one.. Let's not do it again.

excon

Yes we foolishly "gave them money" . But in this case it's not giving the rich money.. . it's not picking their pockets for more .

Not only am I in favor of extending the current tax rates for all taxpayers ;I also am in favor of a massive reduction in the Cap Gains Taxes. Do that and you would really see the economy heat up and unemployment drop.

As JFK once said ,there comes a time when these Keynesian incentives that have been tried prove ineffective . That time came and went early in this downturn. It is debatable if TARP effectively prevented collapse. It is not debatable that the bucket list spending was a complete waste of taxpayer's money.

Yes JFK clearly told the country that

In the past, this could be done in part by the increased use of credit and monetary tools, but our balance of payments situation today places limits on our use of those tools for expansion. It could also be done by increasing federal expenditures more rapidly than necessary, but such a course would soon demoralize both the government and our economy. If government is to retain the confidence of the people, it must not spend more than can be justified on grounds of national need or spent with maximum efficiency.
American Rhetoric: John F. Kennedy - Address to the Economic Club of New York (http://www.americanrhetoric.com/speeches/jfkeconomicclubaddress.html)

Read the rest... he makes a compelling case for across the board 'supply side ' cuts in taxes.

Not only am I in favor of extending the current tax rates for all taxpayers ;I also am in favor of a massive reduction in the Cap Gains Taxes. Do that and you would really see the economy heat up and unemployment drop.
These people (companies?) who make $250K+ a year possess 86% of the American wealth and are not middle class. What have they done during the past five years to create jobs? Corporate profits and productivity have climbed, as has the unemployment rate.

These people making $250,000 are your restaurant owners ,grocery store ,hardware store... Main Street businesses . Great idea penalize them right at the time the economy could be crawling into recovery .
Please show me one credible economists who says you can "tax your way out of recession" . The President himself says that tax increases in a recession are counterintuitive. That is why he is changing his language on this issue . He now talks in terms of not allowing the "tax cuts on the rich " to become permanent . He KNOWS it's a bad idea to increase taxes now.

Business owners around the country are looking a huge hits at the bottom line as it is because of their obligations under the foolishness called Obamacare...

Do you know that these places of business with a handful of employees will have to complete and submit to the IRS a 1099 form for every petty cash purchase over $600 (Section 9006 of the health care bill )? Businesses will now have to issue millions of new tax documents every year.
Brilliant!! Your laundrymat owner will have to retain an office clerk for the purpose of purchasing soap for the business!

It was the rich that paid by far the largest share of the tax bill in the last decade . I know that is an inconvenient truth but it is the truth . Under the "Bush Tax Cuts " .The richest 1.3 million tax-filers -- those Americans with adjusted gross incomes of more than $365,000 in 2005 -- paid more income tax than all of the 66 million American tax filers below the median in income. Ten times more.
Taxes and Income - WSJ.com (http://online.wsj.com/article/SB119786208643933077.html)

In 1980, when the top income tax rate was 70%, the richest 1% paid only 19% of all income taxes; now, with a top rate of 35%, they pay more than double that share.

You want a recovery ? Then don't penalize the businesses that will make it happen.

You want a recovery ? Then don't penalize the businesses that will make it happen.Hello again, tom:

Cool. Let them make it happen FIRST, then they don't get penalized.

excon

Hmm... lets not extend the tax cuts to the middle class or poor unless they spend the money first.
Yeah that's the ticket .

We know tax increases (which is what letting the current tax code expire amt's to) is bad for an economy in a recession. I am in favor of negotiating a new tax structure and I think it could be done in a bipartisan fashion .

So ;extend the current tax code until a new one can be agreed upon.

Businesses are already planning next years activities without knowing what their tax liabilites will be . I submit that is bad for business and bad for the American economy. A lame duck session is too late to make fundamental changes.

Hmm ...lets not extend the tax cuts to the middle class or poor unless they spend the money first. yeah that's the ticket . Hello again, tom:

Nobody - that would be absolutely NOBODY thinks the middle class are the job creators. That, so they say, is the job of the wealthy. Plus, nobody thinks the tax breaks for the wealthy will pay for themselves either.. You DO know that the HOLE Bush blew into the Clinton surplus happened BECAUSE of the Bush tax cuts... And, the jobs STILL traveled overseas... How do you reconcile that?

Out of one side of your mouth you talk about spending money we DON'T have and burdening our grandchildren with the debt, and out of the other you want to add $700 BILLION to it, in the HOPES it creates jobs... How do you reconcile that?

Me? I'm not so sure... My solution... Create jobs FIRST, and then get rewarded... Wassa matter with that? You DO notice that I'm not AGAINST these tax cuts... I'm just for earning 'em.

excon

Businesses are already planning next years activities without knowing what their tax liabilites will be . I submit that is bad for business and bad for the American economy. Hello again, tom:

While we're at it, it's time to debunk that crap too... The new key word the right has glommed onto is "uncertainty" - and then they hammer us to death with it.. Kind of like death panel... It ain't true, but it works..

If you think businessmen wait till they have CERTAINTY in the marketplace BEFORE they invest, you're dreaming... As you should know, there hasn't been certainty in the marketplace for 75 or more years - yet business found a way to invest... As I've said before to you, businessmen don't look to see what politicians are doing before they invest. They look at the market. They look at DEMAND for their product.. Nobody hires people because they think the tax rate is better. They hire people because DEMAND for their product is up. It's the ONLY reason they hire.

Clearly, if businessmen WAITED till politicians ACT, we'd have been in the toilet a long time ago. As a right wing type person, I'da figured you'd know that.

excon

Hello again, tom:

Nobody - that would be absolutely NOBODY thinks the middle class are the job creators. That, so they say, is the job of the wealthy. Plus, nobody thinks the tax breaks for the wealthy will pay for themselves either.. You DO know that the HOLE Bush blew into the Clinton surplus happened BECAUSE of the Bush tax cuts... And, the jobs STILL traveled overseas... How do you reconcile that?

Out of one side of your mouth you talk about spending money we DON'T have and burdening our grandchildren with the debt, and out of the other you want to add $700 BILLION to it, in the HOPES it creates jobs... How do you reconcile that?

Me? I'm not so sure... My solution... Create jobs FIRST, and then get rewarded... Wassa matter with that? You DO notice that I'm not AGAINST these tax cuts... I'm just for earning 'em.

excon

The middle class are the consumers. They are the driving force in the economy. Right now they are afraid of what's to come. They are holding dollars and spending more wisely. Also paying off high interest credit cards and consumer loans. They aren't really buying anything until they know what's ahead.

As far as tax credits for jobs created. I would be against it. Once you create that scheme then the government will tell you who you should hire and we are back at square one. If you want a tax credit for hiring then Id meet you half way. Give a tax break dollar for dollar on education for the purpose of job training. Nobody seems to be doing that any more and skilled labor is waning fast. We need skilled labor force and its those jobs that can affect the economy. Before when unions were strong they built the skilled labor force. Now since unions had gotten greedy their influence have gone to the wayside. And no one has picked up the ball and ran with the education platform. Many jobs out there today expect experience. The problem comes when there are no experienced labor out there. Jobs are changing constantly and an educated labor force is needed with the skills of the latest technology. Its up to business to provide that.

The Obots wasted more than that in a year spreading asphalt on paved roads .

But I am not Adding $700 Billion to the debt by seeking status quo. To let the tax bill expires amts to a massive increase in taxes at exactly the wrong time.

Every time supply side taxe cuts have been tried they increase the revenues into the Federal coffers and stimulate growth . So I have a proven solution that works as opposed to tax increases that historically slow down the economy .

How would your system work ? Would a boss have to get an employee , set that employee ,start paying all the various obligations that a part and partial with the payroll system first... then perhaps take the time and expense to train the employee... would there be a minimum time of employment before the employer is entitled to the tax break ? Then what ? Will the employer now have to petition the government for reimbursement from taxes already paid or will this employer be subject to the increased taxes until the next quarter ? Year ? Lets say this employer hires in good faith and then because of demand or other business realities has to let a percent of their employees go ? Will the employer then have to return the tax break to the government ?
How many new IRS employees would be needed to handle these constant adjustments ? As it is the IRS is going to be underemployed because they will need to process all those additional 1099's their offices will be flooded with.

My own view is the tax system is already way to incenticed with exceptions and breaks ,and conditions . The best tax system for both business and individual would be a system that elimated the complexity in the current code that is nothing more than a create work for accountants charade.
Corporate tax rates are too high bottom line... Business in this country pay higher rates than any of our world competitors save Japan.
And taxing a business person making $250,000 ,and calling that person rich is one of the biggest jokes that has come out of this administration. At least a millionaires tax should not kick in until that person actually is a millionaire.

My own view is the the tax system is already way to incenticed with exceptions and breaks ,and conditions Hello again, tom:

I don't know HOW the details would work out. I just know it COULD work, and I see in your answer, a basis to make it work.

I agree with the above... But, without hiring people directly, that's the ONLY way government has to "create jobs".

excon

Hello again, tom:

While we're at it, it's time to debunk that crap too... The new key word the right has glommed onto is "uncertainty" - and then they hammer us to death with it.. Kinda like death panel... It ain't true, but it works..

If you think businessmen wait till they have CERTAINTY in the marketplace BEFORE they invest, you're dreaming... As you should know, there hasn't been certainty in the marketplace for 75 or more years - yet business found a way to invest... As I've said before to you, businessmen don't look to see what politicians are doing before they invest. They look at the market. They look at DEMAND for their product.. Nobody hires people because they think the tax rate is better. They hire people because DEMAND for their product is up. It's the ONLY reason they hire.

Clearly, if businessmen WAITED till politicians ACT, we'd have been in the toilet a long time ago. As a right wing type person, I'da figured you'd know that.

excon

I've addressed that before too. My comments stand . Leading business people in the country have all said the same thing ;that regime uncertainty is one of the biggest reasons they aren't moving on the investment front. It is also a major reason why consumers will be sitting on the sidelines and curtailing their spending this season.
Are you saying business aren't concerned at all with potentially huge increases in costs? (taxes ,new spending related to Obamacare and FinReg) .Even Obama buttboy Jeffery Immelt has said he just wished he knew what the rules were.

I listen to what business owners are saying... you not so much

I listen to what business owners are saying ...you not so muchHello again, tom:

I AM a business owner. Nuff said.

excon

I have watched your debate with interest and you have the psychology of the tax cuts all wrong. If you reduce tax on the lower income earners you create demand because these people don't keep the money, they spend it. So how come your politicians don't know this and do what they need to do, reduce tax on lower incomes. It has already been said here that these people pay less tax anyway than the high income earners, so you are not giving away much but the psychological effect is to boost both spending and expectation.

I am cynical enough to think that in your system reducing tax on low income earners isn't popular because there are no votes in it.

Wrong most low earners already pay no Federal taxes.
Nearly half of US households escape fed income tax - Yahoo! Finance (http://finance.yahoo.com/news/Nearly-half-of-US-households-apf-1105567323.html?x=0)

The truth is that apx.only half the population contribute to the Federal coffers.

wrong most low earners already pay no Federal taxes.
Nearly half of US households escape fed income tax - Yahoo! Finance (http://finance.yahoo.com/news/Nearly-half-of-US-households-apf-1105567323.html?x=0)

The truth is that apx.only half the population contribute to the Federal coffers.

I think you have the idea of low earners wrong, I'm speaking of those below the threshold of the tax cuts who may not actually be on the bread line. If your system doesn't actually tax half of the income earners, and I doubt that is the correct intrepretation of the statistics, then perhaps it needs a serious overhaul.

What is the point of having a system which doesn't achieve what it sets out to do and that is to have income earners contribute to the maintenance of the nation. You object to the nanny state but you have a worse nanny state than any of us, refunding tax credits.

Yes our system is in serious need of overhaul... I mentioned just one of them related to deductions . It's the correct interpretation all right. The vast majority of the tax revenues collected by the Federal Government is collected from the people everyone claims is screwing them .

But as you know ,the income tax is not the only form of pocket picking our various authorities have devised. The Federal Government still gets their share from the poor in the separate contributions the lower income earners are forced to contribute to the 'entitlement ' system. I'm not naiive enough to believe that these contributions are going towards retirements since the Feds steal this money and add it to the general revenue.

They also pay a larger percentage of their incomes to local taxing authorities for sales tax than the higher income earners.
They are subject to local income and property taxes.

And of course these corporate taxes everyone loves so much get passed onto them in the transfer to the costs of products.

Yes our system is in serious need of overhaul ...I mentioned just one of them related to deductions . It's the correct interpretation alright. The vast majority of the tax revenues collected by the Federal Government is collected from the people everyone claims is screwing them .

But as you know ,the income tax is not the only form of pocket picking our various authorities have devised. The Federal Goverment still gets their share from the poor in the separate contributions the lower income earners are forced to contribute to the 'entitlement ' system. I'm not naiive enough to believe that these contributions are going towards retirements since the Feds steal this money and add it to the general revenue.

They also pay a larger percentage of their incomes to local taxing authorities for sales tax than the higher income earners.
They are subject to local income and property taxes.

And of course these corporate taxes everyone loves so much get passed onto them in the transfer to the costs of products.

Hi Tom

It's a shame that you haven't separated the concept of contribution from the concept of entitlements. We all know taxation is theft and no more so that the flat rate tax implicit in such taxes as fuel excise and sales tax. We have long minimised but not totally eliminated local taxing authorities because we so often see their efforts as regressive. It is not difficult to eliminate collection of tax from low income earners so that the burden of lodging returns is eliminated, you just set the threshold higher in recognition of the outcomes. Please don't invent any new taxes as we have idiots here who think such things have to be tried.

It's a shame that you haven't separated the concept of contribution from the concept of entitlements
It was sold to the country as that ,but when Social Security was challenged in court ,the Roosevelt cabal quickly changed their story and said the collection was a tax. This is the same bait and switch the Obots are using on ObamaCare.

The politicians here still talk about there being a Social Security "Trust Fund" ,and perhaps on paper there is...
However ,their borrowing against it to support their spending makes it for all practical purposes non existent .


Please don't invent any new taxes as we have idiots here who think such things have to be tried.

Same here... there is serious talk of VAT being implemented . They also have their eyes on peoples personal retirement funds ,as 401K accounts represent one of the few untapped sources for their theft.

There is one way to make an instant solution to the economy that no one seems to be talking about. Sure some will have to sacrifice but in the long run it will set the compass of the economy on fire again. Since they moved gasoline to the comodities market it is being held hostage ever since. If they let it go back to private hands as it was before gas would be around .80 cents per gallon. And since this economy runs on fuel it would represent a major windfall for the consumer. If you touch it its more then likely been delivered by a big rig somewhere along the line. For that matter you could even drop it back to where the market would hold it at and set a $1.00 per gallon tax and start paying off the national debt and we would all still be ahead of the game.

On a personal note I also suppot abolishing the tax codes and the IRS and would like to see the fair tax happen. That too would free up a lot of dollars being wasted on hiding the money and shell games.

and set a $1.00 per gallon tax and start paying off the national debt and we would all still be ahead of the game.Hello again, dad:

That looks to me like a tax on the middle class. I'd rather soak, I mean tax the rich... That's not a mistake... The superrich have gotten spectacularly richer over the last four decades while their fellow citizens either treaded water or lost ground. The top 1 percent of American earners took in 23.5% of the nation's pretax income in 2007 — up from less than 9% in 1976. It's time they paid their fair share.

Plus, if these lower rates are supposed to encourage the superrich to create jobs, they've HAD these rates for the last 10 years, and we LOST jobs. What's up with that?

excon

It was sold to the country as that ,but when Social Security was challenged in court ,the Roosevelt cabal quickly changed their story and said the collection was a tax. This is the same bait and switch the Obots are using on ObamaCare.

The politicians here still talk about there being a Social Security "Trust Fund" ,and perhaps on paper there is...
However ,their borrowing against it to support their spending makes it for all practical purposes non existent .

Yes the term Social Security must have entered our language about the same time it did yours along with income tax. When it was implemented we were told that when our population reached 20 million there would be no need for income tax, now it's true tax has been greatly reduced from the heady days of 95% but the Social Security contribution has long since being merged and now we have entitlements, but rather than giving discounts against a rate what we do is manipulate the thresholds so that our top rate has remained much the same for a long time but you have to have an above average income to pay it.



Same here... there is serious talk of VAT being implemented . They also have their eyes on peoples personal retirement funds ,as 401K accounts represent one of the few untapped sources for their theft.

VAT or GST has proven to be one of the better ideas where it is traded off for a lot of inefficient taxes like sales taxes and stamp duties, it certainly traps those who are able to manipulate their declared income or the cash economy. The trap lies in the level of documentation, as you are finding out with the Obama health care legislation but if you keep small business out of it, and work with gross figures not transactions it can work well. As to retirement we have taken a liberal view and reduced taxes associated with such contributions to promote the idea of people not being dependent on government in the long term. What this means is the individual retains control so long as the funds are quarantened and has a favourable tax regime but withdrawal has a penelty component

Hello again, dad:

That looks to me like a tax on the middle class. I'd rather soak, I mean tax the rich... That's not a mistake.... The superrich have gotten spectacularly richer over the last four decades while their fellow citizens either treaded water or lost ground. The top 1 percent of American earners took in 23.5% of the nation’s pretax income in 2007 — up from less than 9% in 1976. It's time they paid their fair share.

Plus, if these lower rates are supposed to encourage the superrich to create jobs, they've HAD these rates for the last 10 years, and we LOST jobs. What's up with that?

excon

Its because they found something better then tax breaks. Its called outsourcing. The cheap labor overseas is what is driving the jobs from here. We can't compete with 10 cents an hour.

Its because they found something better then tax breaks. Its called outsourcing. Hello again, dad:

Then extending the Bush tax cuts for the wealthy is nothing more than a gift for the people who need it the LEAST, that you and I, and our children will be paying for, for a long time to come. I don't like it one bit.

The tax cuts for the wealthy were passed, if you recall, because there was a period of prosperity, and a huge surplus.. It made sense to give some back... Now, the surplus has been replaced with a deficit, and we're in a slump. It makes sense for the rich to give some back.

excon

It makes sense for the rich to give some back.

excon

Come on, ex, none of it makes any sense, when those cuts were made it was made obvious that it was temporary, just like prosperity, now they want tax cuts without prosperity. All this has proved is that you should never cut taxes. Where I come from we understand the process better, the idea is to cut the maximum fleece with a minimum of bleeting

The tax cuts came in the wake of the Clinton recession . It led to a quick recovery and a period of strong growth. There is no such thing as a permanent tax rate as you know so calling them 'temporary' is a political game. What is being proposed here is a tax increase. And as I've pointed out already... I can't think of any economist who thinks tax increases is a good idea in a recession.

The tax cuts came in the wake of the Clinton recession . It led to a quick recovery and a period of strong growth. There is no such thing as a permanent tax rate as you know so calling them 'temporary' is a political game. What is being proposed here is a tax increase. And as I've pointed out already .....I can't think of any economist who thinks tax increases is a good idea in a recession.

You see Tom there's the rub, if they had been permanent look at all the debate that would have been avoided and you could have had a different debate, something about paying the piper, so let's see now; you had a recession under Clinton and a depression under Obama and a war fueled period of growth in between and you do think some sort of fiscal measure isn't needed because your economy is over stimulated to the point of inflation.

Taxation is the only tool you have left, all the others have been stripped away, the alternative might be cutting jobs in the public sector

I think the Bush tax cuts for the wealthy should be allowed to expire, they will just make the debt worse without benefiting the economy. I would cut taxes for the middle-class and introduce a national sales tax similar to the goods and services tax in Canada. It was very unpopular but it got Canada out of debt. Americans need to get over their sense of entitlement about not paying their fair share of taxes. If Canadians and Europeans can pay, so can Americans. Unfortunately, American politicians don't seem to have the will to do things that are necessary but unpopular.

I think the Bush tax cuts for the wealthy should be allowed to expire, they will just make the debt worse without benefiting the economy. I would cut taxes for the middle-class and introduce a national sales tax similar to the goods and services tax in Canada. It was very unpopular but it got Canada out of debt. Americans need to get over their sense of entitlement about not paying their fair share of taxes. If Canadians and Europeans can pay, so can Americans. Unfortunately, American politicians don't seem to have the will to do things that are necessary but unpopular.

Yes the GST is a good idea and it is a growth tax so the better the economy the greater the revenue, we found when we implemented it here that the potential revenue was vastly underestimated, pointing to a cash economy that was much bigger than estimated. The negative impacts were also vastly overestimated as it allowed general tax cuts to be made and a fairer tax regime to be implemented. Look at our economy today, we don't talk about recession, but how to control inflation. The truly wealthy have an ability to use loop holes to reduce tax anyway so the lower the tax rate the less incentive to do so. People need to realise the debate is wrongly oriented, tax is not 100% and you need income to pay tax, so concentrate on generating income, tax doesn't drive the business

and you do think some sort of fiscal measure isn't needed because your economy is over stimulated to the point of inflation.


Huh ? You know why there is a risk of inflation. Our Fed and Treasury have been lousy managers of our monitary policy;letting the dollar steadily decline ;and now with QE2 ,potentially pushing the dollar over the cliff. I took some satisfaction watching the President getting lectured by the likes of Hu Jintao (the phony hypocrite) and Angela Merkel at the G20 meeting last week.
It was comical having our
President being the only world leader thinking that pumping money into the economy would fuel a recovery .He and Bernanke got the wrong ideas about the way FDR handled the 1930s depression.
The truth is that his policies turned it into a decade long event . Obama and Bernanke are hell bent on repeating the mistakes .

Now that I think of it... what Roosevelt did is what is being proposed by various posters on this thred.


Roosevelt, too, pursued the dual purposes of revenue and social good. In 1935 he signed legislation known as the "soak the rich" law. FDR, more radical than Obama in his class hostility, spoke explicitly of the need for "very high taxes." Roosevelt's tax trap was the undistributed-profits tax, which hit businesses that chose not to disgorge their cash as dividends or wages. The idea was to goad companies into action.

The outcome was not what the New Dealers envisioned. Horrified by what they perceived as an existential threat, businesses stopped buying equipment and postponed expansion. They hired lawyers to find ways around the undistributed-profits tax. In May 1938, after months of unemployment rates in the high teens, the Democratic Congress cut back the detested tax. That bill became law without the president's signature

Amity Shlaes - Obama threatens to follow in FDR's economic missteps (http://www.washingtonpost.com/wp-dyn/content/article/2010/07/08/AR2010070804272.html)

Read the rest... there are interesting quotes by prominent business people of today and the 1930s about regime uncertainty also .

History shows that tax increases never stimulate an economy... nor does excessive pump priming with borrowed or printed currency.

Yeah yeah I get it... it feels good to "soak the rich" because people think they are responsible for the economic situation today. Me ,I blame it part on the natural business cycle and a large part on government policies that were enacted to "command" the housing market towards a specific goal.

Yeah yeah I get it ...it feels good to "soak the rich" because people think they are responsible for the economic situation today. Me ,I blame it part on the natural business cycle and a large part on government policies that were enacted to "command" the housing market towards a specific goal.

Tom you don't get it, for the rich tax rates aren't what it is about because they have discovered tax havens so raising a tax rate just collects the unprepared.

The housing market is just one aspect of economic activity. You can't expect to have a housing market led recovery when the market is oversupplied with cheap houses. What you need is a method of preventing foreclosures so that the pool of cheap housing doesn't grow. That might be a legislated moritorium on foreclosures or the government acquiring all those mortgages before forced foreclosure. There is a basic problem, with housing prices low the mortgages are more than the property value. If you had a system where the borrower could not walk away, you might be able to get more emphasis on restructuring. Here's a thought for you, why doesn't your government invite migrants to buy up the cheap housing with government loans. I'm sure you know migration feeds economic growth and with a fresh pool of cheap labour you could bring some of your industries back from overseas.

Yes, you had some foolish policies which came from social engineering, but politicians will always back a dream. When a government implements social policy it should come with guarantees, an insurer of the last resort.

Here is what they should've done with the stimulus funds...

Buy up toxic assets like foreclosed homes ;hire construction crews to bull doze them to get the excess inventory off the market .

I think in most cases bubbles are caused by government command manipulations .

I think in most cases bubbles are caused by government command manipulations .Nope, they are caused by personal greed, the impression that someone can make a quick buck or have the opportunity to get an asset that makes them appear wealthy - case in point the dot-com boom (see irrational exuberance)

I would argue that the Clintoon's and Greenspan's attempt to keep interest rates artificially low caused the dot come bubble. It burst when the Fed made a series of adjustments and raised rates.

Then you don't understand technology and business. Interest rates had nothing to do with the dot com boom.

Then you don't understand technology and business. Interest rates had nothing to do with the dot com boom.
Like you said, unadulterated greed. Someone on another site (grammarmudge.cityslide.com) said: "The guys who wrote the sub-prime mortgages were sleazy, but not illegal (in most cases - some exceptions). The real bad actors were the investment bankers who securitized the bad paper, and then paid the ratings agencies to give them the highest AAA ratings, knowing full well they were garbage, and then selling the worthless stuff to pension funds, municipalities and others.

Putting the blame on Congress is a right wing talking point to divert from the truth.

Were the regulators sloppy? Yes. Did Congress push too hard to promote home ownership? Yes. Did Congress issue fraudulent ratings for toxic bonds? NO. Did Congress pay millions for these ratings? NO. Did Congress gain BILLIONS OF DOLLARS by selling this known garbage to unsuspecting victims? NO!

The core problem is NOT Congress - it is the FRAUD perpetrated by Wall Street investment banks and Wall Street ratings agencies. It's really as simple as that."

Over 1999 and early 2000, the Fed increased interest rates six times. That was seen as a correction for the fact that there was too much money looking for a home. The Dot com collapse happened in March 2000 . It is not greed... capital is always looking for the best investment... What ? You mean you wouldn't change banks for a point or two difference in a CD ?
After the collapse the Fed went right back to an easy money policy ,and again the die was cast... Money looking for investment ,and Government policies encouraging that the money go into the real estate market because administrations for the last 20 years bragged about the increase in home ownership in the country .

Over 1999 and early 2000, the Fed increased interest rates six times. The Dot com collapse happened in March 2000 .Not the cause. Read more here: Dot-com bubble - Wikipedia, the free encyclopedia (http://en.wikipedia.org/wiki/Dot-com_bubble#The_bubble_bursts)


I know you believe that the government has to control everything but I believe in personal responsibility. People excited by this new emerging technology bought in without doing their due diligence i.e. checking the business plan of the companies they invested in. Yes some people made money (I made a little) because they got out knowing that it was unsustainable.

I know you believe that the government has to control everything

Quite the opposite... command economy is a socialist dogma.


People excited by this new emerging technology bought in without doing their due diligence i.e. checking the business plan of the companies they invested in. Yes some people made money (I made a little) because they got out knowing that it was unsustainable

By extension the people who bought homes were irresponsible investors too. I thought the mimi was that they were duped suckers.

Quite the opposite.... command economy is a socialist dogma. Everything you've written as causes relate to the government, never once did you mention a person's choices in the market.

By extention the people who bought homes were irresponsible investors too. Yes, they bought too much house for their current worth and household income.

... and were encouraged to do so by government policy.

Perhaps the only domestic issue George Bush and Bill Clinton were in complete agreement about was maximizing home ownership, each trying to lay claim to a record percentage of homeowners, and both describing their efforts as a boon to blacks and Hispanics. HUD, Fannie, and Freddie were their instruments, and, as is now apparent, the more unsavory the means, the greater the growth.
Andrew Cuomo and Fannie and Freddie - Page 1 - News - New York - Village Voice (http://www.villagevoice.com/2008-08-05/news/how-andrew-cuomo-gave-birth-to-the-crisis-at-fannie-mae-and-freddie-mac/)

I guess you think your fellow americans are stupid. I guess that explains why advertising is so effective in your country.

right back at you


But perhaps the greatest issue looming over Canada's fortunes is its housing market, which has, despite a brief blip, continued to drive higher through the world's economic snow bank due to easy credit, low interest rates and encouraging government tax breaks.

Believers in the Canadian miracle say the country's housing market is not likely to have much of a correction at all, and certainly not the sort of housing swoon seen in the United States or Europe. One reason is that most mortgages were written by one of Canada's six major banks, all of which have existed under tighter regulations than their brethren in the U.S. Another is that sub-prime mortgages were never in vogue. At the height of the American property bubble in 2006, sub-prime mortgages accounted for only 5% of the mortgages taken out in Canada, compared with 25% of those obtained in the United States. Roubini Global Economics says the chance of a "U.S.-style housing bust is unlikely given sound fundamentals of the Canadian financial system and mortgage lending."

But the Canadian housing market is showing signs of strain. Driven by an overhang of supply and by recent government efforts to tighten lending standards, housing starts in October were down 9.2% compared with September, and down more than 12% in urban areas. Also, housing prices have begun to level off after a decade of scaling ever-greater heights. Over the last ten years, housing prices have increased more than 95% nationwide.

Lower housing prices could hit Canadians fairly hard. Housing accounts for more than 20% of Canada's GDP, and its employment gains have been fueled by continued spending in the construction industry, which is one of Canada's largest and fastest growing employment sectors. In October, while the number of workers in Canada's massive service sector declined by 33,000, construction added 21,000 jobs.

There may also be less wiggle-room for Canadian homeowners than many perceive. Canadian banks didn't slice and dice millions of sub-prime mortgages, but they still offered - and continue to offer -- pretty generous terms. Edward Jones wrote in a recent note to clients that the mortgage credit in Canada increased more than 10% a year from 2006 to 2008, more than double the rate of growth from 1997 to 2001. Edward Jones added that "credit is currently more easily available than it was prior to the recent recession."

Canadians easily obtained mortgages with only 5% down and payments running out 35 years. More than 65% of Canadian mortgages are fixed for five years (and now face more stringent renewal terms and likely higher interest payments). But variable rate mortgages offered in Canada were at least as creative as those doled out in the US, with banks allowing terms as short as six months. Unlike in the US, people who default on mortgages in Canada don't just lose their houses, they risk other assets as well.

A fast or unexpected rise in interest rates (Canada was the first G7 country to begin moving them higher following the recession) could leave Canadians with little cushion. Last year the IMF noted that, by some measures, Canadians were paying a larger percentage of their income for housing than Americans did prior to the housing bust.

That level hasn't improved. Recent government data shows that the average Canadian with a two-story home spends almost 50% of his household income on mortgage servicing, with the average is closer to 70% in red-hot markets like Vancouver. "By and large the affordability situation remains within a safe range in Canada; however there are local markets where the share of household income taken up by homeownership costs is at worrisome levels," the Royal Bank of Canada wrote in September, adding that the situation in Vancouver raises "a red flag."

One red flag doesn't make a trend. But it should prick up the ears of investors still hoping for fortune in Klondike country. As the long-time Canada bull James Grant noted in July, "the track of Vancouver housing prices matters far beyond the province of British Columbia," adding that, perhaps, the best place for investors to park their money was in "a country in which a housing bubble has already popped, rather than one -- Canada, for instance -- in which it is just beginning to deflate."

Canada's coming housing bust - Nov. 12, 2010 (http://money.cnn.com/2010/11/12/real_estate/canada_housing_bust.fortune/index.htm)

Hello again,

Right winger Michelle Bachman either doesn't know how taxes are levied in this great country of ours, or she's a liar.. I'm going to opt for being a ditz.

When asked on Good Morning America why she supported tax cuts for the wealthy but not extending unemployment benefits, Bachmann said that Americans don't understand who the "wealthiest" are. (http://blogs.abcnews.com/george/2010/11/michele-bachmann-supports-tax-cut-compromise-but-not-if-tied-to-unemployment-benefits-.html)

“These are people who are carpet layers who maybe employ two or three other guys. Or a plumber maybe himself and his brother and it's $250,000 in gross sales for the business. They're the ones that are looking at massive tax increases,” she said.

She's WRONG, WRONG, WRONG, and even WRONGER than that. Let me explain...

Small businessmen are taxed on the PROFITS of their small business - NOT on the gross sales... Once this mythical plumber deducts the cost of doing business, as ALL small businessmen do on their schedule C, he'll be lucky to have PROFITS of $50,000. So, he's just an ordinary schmoe. His taxes won't be raised if we let the tax cuts for the wealthy expire...

How come a sitting US Congresswoman is SOOOOO ignorant of tax law??

excon

How come a sitting US Congresswoman is SOOOOO ignorant of tax law????
And ignorant of what small businesses make, pay out, and how they balance their books.

Can't defend that statement . I do know of business people who puff up their gross sales as if they were some great achievement . The problem is that their margins are garbage... so I ask them if they like working for nothing .

SmartCo Foods announced today they were closing their five Colorado stores today .That means that 500 more people will be joining the ranks of the unemployed .

Imagine how many more businesses like this ,teetering on the brink ,will make the call to shut down if there is a Reid /Pelosi /Obama tax increase at the end of the year .

Imagine how many more businesses like this ,teetering on the brink ,will make the call to shut down if there is a Reid /Pelosi /Obama tax increase at the end of the year .Hello again, tom:

It's a painful time for all... Imagine how hard your children and grandchildren will have to work to pay BACK the $700 BILLION we'll have to borrow to plug the hole in the budget, that extending the tax cuts for the wealthiest amongst us will surly do...

On balance, it's better for the country NOT to increase its debt right now. Or it IS. I can't tell WHERE your righty's come down on THAT issue.

excon

Oh it's going to take a lot of pain all right if we continue down this path. All you need to do is look to Europe to see our future if we continue this endless entitlement mentality. What ? The Europeans aren't taxing their people enough ?
I'm saying you cannot tax your way out of this mess. You tax ,you hit the bottom line and your tax revenues stall . I'm still waiting for someone to show me the time when taxing in an economic slowdown fixed the economy .

I'm still waiting for someone to show me the time when taxing in an economic slowdown fixed the economy .Hello again, tom:

It's a Mexican standoff.. You still haven't told me WHY it's GOOD to add $700 BILLION to the deficit during an economic slow down.

excon

You still haven't told me WHY it's GOOD to add $700 BILLION to the deficit during an economic slow down.


Wasn't my idea. It was Bush's TARP and the President's various Keynesian attempts that added the additional debt. I know that solution has never succeeded either.

But you aren't saying if we don't increase taxes that we'll be adding to the deficit . That is silly . The tax rates have been in place for 8 years... now couching a tax increase in the language of "letting tax cuts expire "doesn't let those off the hook that say they aren't raising taxes. It's silly ;it's like saying... there was no tax cut... it was letting the Clintoon tax increases expire.

Here's a reality check... you cannot possible tax the top 2% enough to do what you want to do even if you confiscated all their money.

Hello again, tom:

So, while we're standing off, I thought I would show how WRONG Michelle Bachman is from another angle...

Let's talk about her mythical plumber who's taxes are going to be affected by the proposed increase... IF, on his schedule C, he winds up with $250,000 of net profit, his business most likely had gross sales of over $2.5 MILLION. This ISN'T a couple of guys sweating it out every day installing carpet... No it's not. It's not even close... He's got LOTS of plumbers on the payroll. He owns LOTS of trucks. He probably owns a BIG building or two. He employs LOTS of people. He's a small business, and a DAMN successful one if he can take home a quarter of a mil every year. His personal car is owned by his business. His wife's car is owned by the business. He could afford an airplane, owned by the business, of course... If he has a boat, that too, could be owned by the business... All of the above stuff is perfectly LEGAL, of course..

And, after ALL those expenses were paid for by his business, he STILL has $250,000 of pocket money every year... That's over $20,000 EVERY MONTH. This is a guy who is a FAR CRY from the poor working schlub that Michelle Bachman is lying about. THIS is a guy, who can afford to have his taxes raised BACK to where they were before George W. Bush. THIS is a wealthy guy.

excon

Or he could be someone who was laid off and is now working as an independent contractor . Yes he does double time and perhaps barely eeks out that $250,000 . But he lives in liberal North East and he pays a fortune in local taxes along with this now bumped up Federal rate that is just short of 40% ;along with his FICA... oh yeah ,and he pays for his families insurance.
He has 2 maybe 3 kids or more . In the North East he may have a mortgage that he is managing to pay on a mothly basis ;but he bought it when the market peaked and he was working for another employer who went belly up. He cannot sell the home because it is underwater for about half the price he purchased it for . But he continues to slog along working those 80 hr weeks .

I submit to you he is not rich and is being unfairly targeted .

Geeze... if your going to have a millionaire's penalty at least target millionaires.

But you aren't saying if we don't increase taxes that we'll be adding to the deficit . That is silly .Hello again, tom:

That's EXACTLY what I'm saying... Only I'm not spinning it... Here's how it is. The tax cuts were temporary. They're going to expire, by law this year. Budgets were made based upon that law - budgets that anticipated $700 BILLION of revenue WHEN the tax cuts expired...

If they DON'T expire, we're going to have $700 billion LESS than we budgeted for. That means we're going to have to BORROW $700 BILLION to cover the expenses that are already in place... If we let them expire, then we don't have to ADD to the deficit.

I'm not going to split hairs about it being a tax increase, or not.

excon

. Budgets were made based upon that law - budgets that anticipated $700 BILLION of revenue WHEN the tax cuts expired...


Yea I agree the Dems made a budget based on the fact that they would soak the rich and many other faulty assumptions like $700 billion in asphalt would fix the economy ;or taking ownership of GM would be a money maker. Or that Obamacare would be a bargain .

I guarantee the government revenues will be well short of the forecast if they do this because the rich will not be making as much money ,and the unemployed will not be paying any taxes but instead will continue to tap into the unemployment stimulus (Pelosi's words ) .

I guarantee the government revenues will be well short of the forecast if they do this Hello again, tom:

You don't have to worry. They'll cave. They won't even argue the great argument I just argued. They'll lay down instead... That's WHY they lost. They ain't got no balls. They suck. In the final analysis, like the Republicans, they're slaves to corporate money too..

excon

PS> I think I mentioned Russ Fiengold making a presidential run under a 3rd party banner. You told me I was all wet... I heard a rumor today that he was going to do exactly THAT.

I didn't say you was all wet. I said I hope you are right. The more primary challenges to the President the better ( I don't think he'd do an independent run but it is possible he could represent a fringe left that amazingly thinks the President isn't "progressive " enough)

I think it's more likely he makes a run for Herb Kohl's Senate seat.

Interesting that the $700 billion number you keep bringing up is almost identical to the amt of currency the Fed is planning on adding to the market with it's crazy QE2 .
Back in 2008 the Fed lent zombies a Trillion and they purchased Treasuries at 3% and then sold them back to the Fed...
Now the die is cast for a repeat performance. Zombies kept alive by Voodoo monetary policy.

Building the house of cards into a highrise... and the taxpayer is told that if they don't open their wallet to Robin Hood some more the house of cards will collapse .

Interesting that the $700 billion number you keep bringing up is almost identical to the amt of currency the Fed is planning on adding to the market with it's crazy QE2 .
Back in 2008 the Fed lent zombies a Trillion and they purchased Treasuries at 3% and then sold them back to the Fed....
Now the die is cast for a repeat performance. Zombies kept alive by Voodoo monetary policy.

Building the house of cards into a highrise .......and the taxpayer is told that if they don't open their wallet to Robin Hood some more the house of cards will collapse .

This is a very risky policy that threats not only the US but the rest of the world. We have already been through a period of inflation which is unprecedented. We don't need another to satisfy the averice of the US. Pay the price of your foolishness and leave the rest of us alone.

Indeed we are putting the world economy at risk. But then again did the EU give a rat's a$$ about the world economy as they forever expanded their entitlement states ? I thought the world wanted the US to follow their lead.

Indeed we are putting the world economy at risk. But then again did the EU give a rat's a$$ about the world economy as they forever expanded their entitlement states ? I thought the world wanted the US to follow their lead.

That's a little backwards isn't Tom after all they were creating a united states of Europe, following your lead and in any case their currency was appreciating against yours significantly while they were doing this. Everyone pays for idiocy sooner or later and your own experts are predicting a meltdown of 50% in the value of your currency, that should restore your competition in the export markets but you also have to learn to pay yourself less so what price wages at $2.50 an hour, you are so efficient you should be able to compete with china on that. I think you will find tax an easier pill to swallow

Please ; they taxed themselves to the max ,awarded themselves sweetheart nanny state cradle to grave entitlements... did not even put sufficient resources into the common defense so they could spend more on their socialist ideas... and still are watching one nation after the other go down in economic ruin.

All their finance ministers talk about today are rolling back the entitlement system ,and are begging our President to not make the same mistakes.

please ; they taxed themselves to the max ,awarded themselves sweetheart nanny state cradle to grave entitlements ....did not even put sufficient resources into the common defense so they could spend more on their socialist ideas ...and still are watching one nation after the other go down in economic ruin.

All their finance ministers talk about today are rolling back the entitlement system ,and are begging our President to not make the same mistakes.

Yes Tom they taxed and spent, some of it very unwisely because they didn't support long term individual productivity and they will have to maintain high taxes. I don't blame Europe for not wanting to put money into defence when the US wanted to do it for them, after all Europe has had enough of war. As I said sooner or later you pay for idiocy. So a longer working life not a shorter one, but maintain the unit of production. The European entitlements are generous to a fault but if it is paid for by taxation that's not wrong. What's wrong is where people try to get it for nothing

Hello:

They SAY that if the Bush tax cuts are extended to the richest people amongst us, they'll create jobs. They certainly might. I dunno. But, we don't have to guess. Instead of just giving them a tax break and HOPE they'll do the right thing, why don't we give them a tax break WHEN they create the jobs?

I'd go for that. You? Remember when we gave the banks money and HOPED they start lending?? We got snookered on that one.. Let's not do it again.

excon

The idea that tax cuts for the rich is good for the economy is a shibboleth that just won't go away. Repeat something often enough and it begins to acquire, sadly, a patina of truth.

It didn't work for Reagan or Bush 1, in fact it backfired disastrously, yet we are presented with this nonsense constantly by the right-wing.

Extending unemployment is a far better stimulus than tax cuts for the rich.

Extending unemployment is a far better stimulus than tax cuts for the rich.

Now I thought that was what they had been doing, many more now draw unemployment than did before. Stimulus is needed to get industries going not just give existing industries more demand, the unemployed spend money on basic necessities so nothing new is added. What you need are programs to build roads and bridges, do major repair projects, sell more equipment overseas all of the industries that employ large numbers, it is wages that give stimulus not benefits

Reagan tax cuts brought us 20 years of prosperity .

Reagan tax cuts brought us 20 years of prosperity .

Prosperity for whom?

The rich prospered while everybody else lost ground or trod water.

Why do you shill for the rich? They don't give a damn about you.

Because I never got a job from a poor person . Because I hike in land donated to the public by some greedy rich guy. Because I go the museums in NY that have greedy rich guy patrons names on the top list of donors . Because I go to theaters that have rich guy patrons . Because rich people set up foundations that donate the vast majority of their wealth to charity .

Why do you want to penalize success ? Suppose you pulled yourself up and became successful only to be vilified and targeted for your success ? I'd wonder if it was worth the effort . I could make effectively less money and not hire those handful of workers and still lead a comfortable existence skating my way through life. Those workers that I don't hire ? Why would I give a damn about them ?(your words )

Why do you want to penalize success ?Hello again, tom:

From my perspective, I don't want to PUNISH success. I LOVE success. I just want them to pay their fair share. Warren Buffet is fine with paying more. Bill Gates is too. They don't seem to feel punished.

Besides, borrowing $700 billion, that yours and my grandchildren will PAY for, to give the richest amongst us a tax break, strikes me as fanciful.

excon

I'm not overly concerned about Gates and Buffett . They have set themselves up nicely that they never have to pay the taxes they promote. Besides they are in rare air . You could take all their money and never get the country out of the hole it's in ;nor will you unless you drastically reduce expeditures or tax the hell out of the middle class.

My concern is with the people who create the vast majority of the jobs ;not the Gates of the world ,but the business owner I profiled . They are already getting hammered to a point that some of them have made the decision I just described.

I talked to the guy who does my chimney . In his day he made a good living hired a half dozen or so construction crew to clean and install chimneys. He has laid off his entire crew ;reduced his hours ,customers etc. It is not worth it to him to bust his butt for that last buck anymore because the benefits to doing it are not there . He talked about the fact that he now has the leisure time he never had before when he was thinking of expansion ;and his income level has not dropped all that much . He tells me under the threat of increased taxation and paying the costs associated with being an employer he really has not lost much .

This the question, do you want higher tax rates or higher tax revenue? I guarantee when you raise taxes on the rich they're going to change their behavior accordingly, then who will be bearing the burden of supplying tax revenue?

For example, John Kerry and his yacht.

has laid off his entire crew ;reduced his hours ,customers etc. It is not worth it to him to bust his butt for that last buck anymore because the benefits to doing it are not there . He tells me under the threat of increased taxation and paying the costs associated with being an employer he really has not lost much .Hello again, tom:

Yeah, you and Michelle Bachman think these guys taxes are going up.. They AIN'T... They're NOT the wealthy. They're not even close. You're not telling me, are you, that the guy doing your chimney is NETTING at LEAST a quarter MILLION a year?? Nahhh... You're not saying that. He doesn't, and with his full compliment of workers, he never did and never will.. He's just your ordinary schlub feeling the effects of the recession. His taxes will NOT go up.

excon

He is not a shlub . He ran a major company that serviced 2 counties in the NYC suburbs. The only recession effect is that fewer people are getting new chimneys .

I doubt if $250,000 is big bucks in the Seattle area either... I know it isn't in the NYC area. It can hardly be classified as "rich " despite the fact that it falls in the upper tier of income.

He is not a shlub . He ran a major company that serviced 2 counties in the NYC suburbs. The only recession effect is that fewer people are getting new chimneys .

I doubt if $250,000 is big bucks in the Seattle area either ....I know it aint in the NYC area. It can hardly be classified as "rich " despite the fact that it falls in the upper tier of income.

Your example of a cleaning/installation chimney company doesn't make sense.

This is not a "major" company by any definition. With six employees (or even just one - himself), he is nowhere near the income level that would be affected, (as posted above). Even more strange is his decision to lay off the crew "in anticipation of the tax increase". The guy is either a very bad businessman or doesn't understand taxes.

I understand you're trying to present arguments against letting the tax cuts expire, but such a weak argument as this one doesn't help your position one iota.

On a previous reply, you indicated that the rich have done many things for you - philanthropy; like museums, theaters, nice places to hike, and charitable foundations. It's hard to respond with a straight face to such nonsense; you have a right to your beliefs.

To the degree the rich provide jobs, I agree that's a good thing but let's not overstate it. Giving the rich more money in tax breaks is not the job stimulus you think. Job creation is the result of many more important factors than simply increasing the wealth of the already wealthy.

The CBO (non-partisan Congressional Budget Office) estimates the cost of not letting the tax cuts expire to be roughly one trillion dollars added to the deficit over the next decade with no corresponding reduction in services. It also suggests that extending unemployment is a far better help to the economy than continuing these tax cuts.

I happen to agree that $250,000 these days is hardly "rich". But it's equally true that a $30-40 tax cost for every incremental net profit increase of $1,000 is hardly enough to, say, close down a business. Who would turn down $960 profit for a cost of doing business of $40?

I happen to agree that $250,000 these days is hardly "rich". But it's equally true that a $30-40 tax cost for every incremental net profit increase of $1,000 is hardly enough to, say, close down a business. Who would turn down $960 profit for a cost of doing business of $40?

It seems some people are stupid enough to let tax drive their business. Yes, it is difficult to swallow a cut in take home pay, but that just demonstrates someone isn't working hard enough at getting the right advice, probably too tuned to poverty and how much they loose in tax, to realise you have to spend a buck to make a buck. This is all emotive nonsense, more of the why should I pay for someoneelse thinking that typifies laisse faire capitalism

I'm hearing the same things from local business and it is being published by the heads of major corporations . Yeah I get it... they are all a bunch of "stupid" people .
You think business don't plan around what their tax liability will be ? Dude !

Tax uncertainty frustrates financial planners | detnews.com | The Detroit News (http://detnews.com/article/20101018/BIZ01/10180309/Tax-uncertainty-frustrates-financial-planners)

The ChamberPost: Chamber to Congress: End Uncertainty, Don?t Raise Taxes (http://www.chamberpost.com/2010/11/chamber-to-congress-end-uncertainty-dont-raise-taxes.html)

"Small business owners do not have it easy, even in good economic times. They've certainly been put to the test during the last two years. Unfortunately, Washington only made matters worse--imposing mandates businesses can't interpret and threatening to raise taxes to make up for years of overspending. Entrepreneurs face an uncertain future--they simply can't afford what government is currently dishing out," said Karen Kerrigan, President & CEO of the SBE Council.

New Video Series Highlights How Government Uncertainty Plagues Business - MarketWatch (http://www.marketwatch.com/story/new-video-series-highlights-how-government-uncertainty-plagues-business-2010-11-19?reflink=MW_news_stmp)
Tim Ryan: Investors Need Tax Certainty (http://www.huffingtonpost.com/tim-ryan/investors-need-tax-certai_b_784928.html)
Permanent tax relief best for all - SalemNews.net | News, Sports, Jobs, Ohio, Community Information - The Salem News (http://www.salemnews.net/page/content.detail/id/535276/Permanent-tax-relief-best-for-all.html?nav=5003)


BTW I am unimpressed with a CBO report that doesn't recognize that the Dems did a Keynes on steroids stimulus and informs us that we aren't collecting enough revenue in a recession to pay for it. I thought the whole rational for Keynesian policies was deficit spending . I can point to examples where supply side tax cuts have stimulated the economy and can't think of one instance where Keynesian pump priming has helped .

and can't think of one instance where Keynesian pump priming has helped .Hello again, tom:

How about WWII? We went waaaaay in the red on that one - but it worked out OK. It ended the depression and set us on a course of prosperity the likes of which has NEVER been seen before or after.

excon

Sure did... all competing economies were bombed out of existence for a decade . Funding an existential war effort can hardly be called Keynesian pump priming ;nor was it's intended to bring us out of the depression.

But FDRs decade long Keyesian efforts did have the effect of prolonging a bad recession. Not only that... but to top it off ;he went on a hissy fit against the rich ,charged them punitive taxes and prolonged it further .

We are right back to were we began... so I'll again link to this Amity Shlaes op-ed in the Washinton Compost :

Taxation is an obvious area the Obama administration ought to reconsider. Income taxes, the dividend tax and capital gains taxes are all set to rise as the Bush tax cuts expire. The Obama administration portrays these increases as necessary for budgetary and social reasons. A society in which the wealthy pay their share, the message goes, has a stronger economy. The administration and congressional Democrats are also striving to ensure that businesses pony up.
Roosevelt, too, pursued the dual purposes of revenue and social good. In 1935 he signed legislation known as the "soak the rich" law. FDR, more radical than Obama in his class hostility, spoke explicitly of the need for "very high taxes." Roosevelt's tax trap was the undistributed-profits tax, which hit businesses that chose not to disgorge their cash as dividends or wages. The idea was to goad companies into action.

The outcome was not what the New Dealers envisioned. Horrified by what they perceived as an existential threat, businesses stopped buying equipment and postponed expansion. They hired lawyers to find ways around the undistributed-profits tax. In May 1938, after months of unemployment rates in the high teens, the Democratic Congress cut back the detested tax.
Amity Shlaes - Obama threatens to follow in FDR's economic missteps (http://www.washingtonpost.com/wp-dyn/content/article/2010/07/08/AR2010070804272.html)

Hello again, tom:

How about WWII? We went waaaaay in the red on that one - but it worked out ok. It ended the depression and set us on a course of prosperity the likes of which has NEVER been seen before or after.

excon

Ex you old national socialist you, war is good for business is it? It certainly solves the unemployment crisis. Next thing you will be doing is promoting Hitler on the basis it is good for business, Bush did it for Saddam, but Obama hasn't clicked yet, Ahamadjihad just doesn't do it for him